Responding to pressure from business and petroleum industry lobbying groups, as well as Gov. Greg Abbott, the Texas House of Representatives passed a bill last week to replace Chapter 313 — a controversial tax incentive program that expired in 2022. Under the “grid reliability” provisions of House Bill 5, it will be easier for manufacturing projects tied to the oil and gas industry to qualify for tax abatements than under Chapter 313, which critics described as “corporate welfare” and a “colossal giveaway” to industry. But for reasons that likely have little to do with economic realities and everything to do with top-down political pressure, renewable projects will be excluded from the new incentive program entirely.
According to an analysis of the Texas comptroller’s reporting by the Houston Chronicle, the manufacturing sector — chiefly oil, gas and petrochemical companies — reaped nearly three quarters of the $31 billion in tax savings awarded to private companies through local school districts over the 20-year lifespan of Chapter 313, but renewables accounted for two-thirds of agreements. While big-ticket hydrocarbon industry projects were centered in a handful of school districts in heavily industrialized areas along the Gulf Coast, renewable projects were scattered across the state and primarily located in rural areas.
