HB 284 — An exemption from sales

90R2061 CJD-D By: Money H.B. No. 284 relating to an exemption from sales and use taxes for certain distributed energy systems.

SECTION 1. Subchapter H, Chapter 151, Tax Code, is amended by adding Section 151.3183 to read as follows: Sec. 151.3183. DISTRIBUTED ENERGY SYSTEMS. (a) In this section, "distributed energy system" means a device or system that is designed and used primarily to generate electricity that is consumed solely by a structure or facility located near the site at which the device or system is installed. The term includes equipment that is: (1) sold or used in connection with the initial installation of the device or system; and (2) necessary to support the operation of the device or system. (b) Except as provided by Subsection (c), the sale, use, lease, or installation of a distributed energy system is exempted from the taxes imposed by this chapter. (c) The exemption provided by this section does not apply to costs related to: (1) construction that is unrelated to the installation of a distributed energy system; (2) repairs to a distributed energy system; or (3) maintenance of a distributed energy system. (d) A person claiming an exemption under this section must make available on request by the comptroller documents or records sufficient to show eligibility for the exemption. (e) The comptroller shall adopt rules to implement and administer this section, including rules relating to: (1) determining the eligibility of a device, system, or equipment item for the exemption provided by this section; and (2) prescribing reporting requirements for a person claiming an exemption under this section.

SECTION 2. The change in law made by this Act does not affect tax liability accruing before the effective date of this Act. That liability continues in effect as if this Act had not been enacted, and the former law is continued in effect for the collection of taxes due and for civil and criminal enforcement of the liability for those taxes.

SECTION 3. This Act takes effect July 1, 2027, if this Act receives a vote of two-thirds of all the members elected to each house, as provided by Section 39, Article III, Texas Constitution. If this Act does not receive the vote necessary for effect on that date, this Act takes effect October 1, 2027.