Texas Proposition 7, Creation of State Energy Fund Amendment (2023)

Texas Proposition 7
Election date November 7, 2023
Topic Energy and Utilities
Status a Approved
Type Constitutional amendment	Origin State legislature

Texas Proposition 7, the Creation of State Energy Fund Amendment, was on the ballot in Texas as a legislatively referred constitutional amendment on November 7, 2023.The ballot measure was approved.

A "yes" vote supported creating the Texas Energy Fund to be administered by the Public Utilities Commission and authorizing the state legislature to allocate funds for the modernization of electric generating facilities.

A "no" vote opposed creating the Texas Energy Fund to be administered by the Public Utilities Commission and authorizing the state legislature to allocate funds for the modernization of electric generating facilities.

Election results

Texas Proposition 7
Result		Votes	Percentage
Yes		1,644,279	64.92%
No		888,410	35.08%

Results are officially certified.

Source

Overview

What did the amendment do?

See also: Text of measure

The amendment established the Texas Energy Fund in the Texas Constitution to fund the construction, maintenance, modernization, and operation of electric generating facilities. The fund is administered by the Public Utility Commission (PUC) of Texas, which is authorized to provide loans and grants to advance the purposes of the fund. The amendment requires that the PUC allocates money to eligible projects in each region of Texas that contain an electric power grid in proportion to that region's load share.

Money in the fund consists of money appropriated by the state legislature; investment returns from the fund; and gifts, grants, and donations contributed to the fund. The expenses of managing the fund will be paid by the fund. Money appropriated by the state legislature will be excluded from the state's appropriation limit.

The Texas State Legislature also passed Senate Bill 2627, the implementing legislation, during the 2023 legislative session. It took effect when the amendment passed. SB 2627 established an advisory committee for the fund. It also detailed the types of projects that could be funded by the Texas Energy Fund.

Who supported and opposed this amendment?

See also: Support and Opposition

ConocoPhillips, Koch Companies, BASF Corporation Employees PAC, Texas Association of Manufacturers, Texas Oil and Gas Association, Texas Pipeline Association, and Valero Energy Corporation PAC registered in support of the amendment. State Sen. Charles Schwertner (R-5), who sponsored the amendment, said, "Winter Storm Uri revealed the failures in our electricity market, specifically the lack of reliability. ... S.B. 2627 creates a completion bonus and zero-interest loan for new dispatchable generation resources directly targeted at 'steel in the ground.' It also provides low-interest loans for existing dispatchable generators as a mechanism for generators to access capital needed to maintain and make necessary improvements to existing generation resources."

Oneok, Inc., Environment Texas, Texas Advanced Energy Business Alliance, and Texas Consumer Association registered in opposition to the amendment. Environment Texas Executive Director Luke Metzger said, "We need, and Texans want, more clean energy, not less. There is strong support for more wind and solar energy, more battery storage, more energy efficiency, and more interconnection with the national grid. Unfortunately, the Legislature ignored these solutions to strengthen our electric grid while protecting consumers and the environment."

Text of measure

Ballot title

The ballot title was as follows:

“

The constitutional amendment providing for the creation of the Texas energy fund to support the construction, maintenance, modernization, and operation of electric generating facilities.

”

Constitutional changes

See also: Article 3, Texas Constitution

The measure amended section 49 of Article 3 of the state constitution. The following underlined text was added: Note: Use your mouse to scroll over the below text to see the full text.

Sec. 49-q. (a) The Texas energy fund is created as a special fund in the state treasury outside the general revenue fund. (b) As provided by general law, money in the Texas energy fund may be administered and used, without further appropriation, only by the Public Utility Commission of Texas or that commission’s successor in function to provide loans and grants to any entity to finance or incentivize the construction, maintenance, modernization, and operation of electric generating facilities, including associated infrastructure, necessary to ensure the reliability or adequacy of an electric power grid in this state. The commission shall allocate money from the fund for loans and grants to eligible projects: (1) for electric generating facilities that serve as backup power sources; and (2) in each region of the state that is part of an electric power grid in proportion to that region’s load share. (c) The entity administering the Texas energy fund may establish separate accounts in the fund as necessary or convenient for the fund’s administration. (d) The Texas energy fund consists of: (1) money credited, appropriated, or transferred to the fund by or as authorized by the legislature; (2) revenue that the legislature dedicates for deposit to the credit of the fund; (3) the returns received from the investment of the money in the fund; and (4) gifts, grants, and donations contributed to the credit of the fund. (e) The reasonable expenses of managing the Texas energy fund’s assets shall be paid from the fund. (f) The legislature by a provision of a general appropriations act may provide for the transfer to the general revenue fund of money that is subject to this section. (g) The legislature may appropriate general revenue for the purpose of depositing money to the credit of the Texas energy fund to be used for the purposes of that fund. (h) For purposes of Section 22, Article VIII, of this constitution: (1)money in the Texas energy fund is dedicated by this constitution; and (2) an appropriation of state tax revenues for the purpose of depositing money to the credit of the Texas energy fund is treated as if it were an appropriation of revenues dedicated by this constitution.

Readability score

See also: Ballot measure readability scores, 2023

Using the Flesch-Kincaid Grade Level (FKGL) and Flesch Reading Ease (FRE) formulas, Ballotpedia scored the readability of the ballot title for this measure. Readability scores are designed to indicate the reading difficulty of text. The Flesch-Kincaid formulas account for the number of words, syllables, and sentences in a text; they do not account for the difficulty of the ideas in the text. The state legislature wrote the ballot language for this measure.

The FKGL for the ballot title is grade level 21, and the FRE is -15. The word count for the ballot title is 24.

Support

Texas Infrastructure Coalition led the campaign in support of Proposition 7.

Supporters

Corporations

• ConocoPhillips Alaska
• Koch Companies

Organizations

• BASF Corporation Employees Political Action Committee
• North Texas Commission
• Texans for Fiscal Responsibility
• Texas Association of Manufacturers
• Texas Oil and Gas Association
• Texas Pipeline Association
• Texas Realtors
• Valero Energy Corporation Political Action Committee

Arguments

• State Sen. Charles Schwertner (R-5): "Winter Storm Uri revealed the failures in our electricity market, specifically the lack of reliability. ... S.B. 2627 creates a completion bonus and zero-interest loan for new dispatchable generation resources directly targeted at 'steel in the ground.' It also provides low-interest loans for existing dispatchable generators as a mechanism for generators to access capital needed to maintain and make necessary improvements to existing generation resources."
• Tony Bennett, president and chief executive officer of the Texas Association of Manufacturers: "In addition to bolstering reliability, increasing the supply of generation will help keep prices in check for all consumers by reducing the frequency of expensive power shortage events."

Opposition

Opponents

Corporations

• Oneok, Inc.

Organizations

• Environment Texas
• Huffines Liberty Foundation
• Sierra Club
• Texas Advanced Energy Business Alliance
• Texas Consumer Association
• Texas Eagle Forum
• True Texas Project

Arguments

• Environment Texas Executive Director Luke Metzger: "We need, and Texans want, more clean energy, not less. There is strong support for more wind and solar energy, more battery storage, more energy efficiency, and more interconnection with the national grid. Unfortunately, the Legislature ignored these solutions to strengthen our electric grid while protecting consumers and the environment."
• Texas Consumer Association President Sandie Haverlah: "The problems with Proposition 7 have been recognized by a number of groups across the political spectrum. Remarkably, this scheme has resulted in a rare case of Texans from both sides of the aisle coming together in opposition. Texans believe in a hand up, not a handout. Proposition 7 is nothing more than a handout that our children and grandchildren will be paying for and should be voted down."

Campaign finance

See also: Campaign finance requirements for Texas ballot measures

If you are aware of a committee registered to support or oppose this amendment, please email editor@ballotpedia.org.

	Cash Contributions	In-Kind Contributions	Total Contributions	Cash Expenditures	Total Expenditures
Support	$0.00	$0.00	$0.00	$0.00	$0.00
Oppose	$0.00	$0.00	$0.00	$0.00	$0.00

Media editorials

See also: 2023 ballot measure media endorsements

Ballotpedia lists the positions of media editorial boards that support or oppose ballot measures. This does not include opinion pieces from individuals or groups that do not represent the official position of a newspaper or media outlet. Ballotpedia includes editorials from newspapers and outlets based on circulation and readership, political coverage within a state, and length of publication. You can share media editorial board endorsements with us at editor@ballotpedia.org.

Support

• Houston Chronicle Editorial Board: "Proposition 7 would create the Texas Energy Fund to subsidize low-interest loans for the 'construction, maintenance, modernization and operation' of new power plants. ... Proposition 7 is hardly perfect, but as a sum of its parts it could be an effective bridge solution for keeping our lights on and ACs running. We urge a 'for' vote on Proposition 7."
• The Dallas Morning News Editorial Board: "RECOMMENDATION: Yes. The deadly power outages caused by the February 2021 winter storm made many Texans aware of the unreliability of the state’s electric grid. A record-setting heat wave which broke demand records 10 times this summer added worry."
• Fort Worth Star-Telegram Editorial Board: "Another ongoing fund, this time $5 billion to finance electricity development, would be created. The state needs more energy capacity fueled by natural gas. Ideally, the market would account for it. But we can’t risk another grid shutdown. Recommendation: For."

Opposition

• San Antonio Express-News Editorial Board: "Proposition 7: This would create a Texas energy fund to support the construction, maintenance, modernization and operation of electric generating facilities. The Legislature would allocate $5 billion to create the fund, which would distribute 3% interest loans and grants to companies to build natural gas-fueled power plants on the state’s main electric grid. Texas' energy needs are clear, but excluding renewable energy sources, so instrumental in keeping the lights on this summer, is frustrating and myopic. Our view: Against."
• The Austin Chronicle Editorial Board: "Incentives for New Gas Plants: No. Though the ballot language is vague enough to seem positive, Prop 7 would actually just give low-interest loans and grants to encourage the construction of new gas plants – benefits that they already get from the private market – and literally stipulates that new battery construction projects need not apply. Yes, we need more energy sources, but this would essentially create a taxpayer-backed subsidy for gas plants alone, creating an unfair disadvantage for renewables and their backups."
• Austin American-Statesman Editorial Board: "With this amendment, the state shows its hand that it is wiling to help one player only — natural gas-powered electric plants, which can harm the environment and be more expensive to operate than cleaner solutions. If natural gas-powered plants are needed, they should be able to get their own financing to build. Vote 'No.'"

Background

Senate Bill 2627 (2023)

The Texas State Legislature passed Senate Bill 2627 (SB 2627) during the 2023 regular legislative session by a vote of 30-1 in the Senate and 114-20 in the House. SB 2627 provided that the Texas Energy Fund is a special state treasury fund administered by the Public Utility Commission (PUC). The PUC was authorized to provide grants to fund transmission and distribution infrastructure and electrical generating facilities in the areas outside of the Electric Reliability Council of Texas (ERCOT) power region, which encompassed about 75% of the state. SB 2627 prohibited grant funds from being used to comply with weatherization standards adopted before December 1, 2023, or debt payments.

The PUC was authorized to provide loans to finance:

• upgrades to existing dispatchable electric generating facilities that provide power to the ERCOT power region that results in a net increase of at least 100 megawatts of capacity per facility and
• construction of new facilities in the ERCOT power region that each have a generation capacity of at least 100 megawatts.

Under the bill, the criteria for evaluating loan applicants included:

• quality of services and management;
• efficiency and history of operations;
• resource operation attributes;
• ability to address regional and reliability needs;
• access to essential resources for operating the facility;
• creditworthiness and ability to repay the loan;
• the cost of the project and impact of the generation facility; and
• any other factors PUC finds appropriate.

The loans have a 20-year term and an interest rate of 3%. Since the amendment was approved,, PUC was required to begin accepting applications by June 1, 2024.

Texas Public Utility Commission

See also: Texas Public Utility Commission

The Public Utility Commission of Texas (PUCT) is a state executive agency in the Texas state government. The commission is in charge of regulating electric and telecommunications utilities in Texas. Its stated mission is to "protect customers, foster competition, and promote high-quality infrastructure."

It is composed of five commissioners. The five commissioners are appointed by the governor to six-year, staggered terms. The governor appoints the presiding officer (chair) from the five-member commission to serve at the pleasure of the governor. The budget for the Texas Public Utilities Commission in Fiscal Year 2022 was $19,096,390.

Electric Reliability Council of Texas (ERCOT)

The Electric Reliability Council of Texas (ERCOT) is a nonprofit corporation that manages electric power for most of Texas. As of 2023, it managed electric power for approximately 26 million Texas residents and represented approximately 90% of Texas' electric power. The members of ERCOT include consumers, cooperatives, generators, power marketers, retail electric providers, investor-owned electric utilities, transmission and distribution providers, and municipally owned electric utilities. The Public Utility Commission of Texas and the Texas Legislature have regulatory authority over ERCOT. The map to the left shows the counties in the ERCOT power region.

Winter Storm Uri (2021)

A Category 3 major winter storm, referred to as Winter Storm Uri, formed on February 11, 2021, over Texas. Gov. Greg Abbott (R) issued a state of emergency for all 254 Texas counties due to the storm on February 12. On February 13, some electric generating facilities began experiencing outages, and on February 14, ERCOT issued a public statement asking customers to reduce energy usage because power generation could not be increased to meet demand. ERCOT implemented controlled blackouts, and the grid normalized by February 19. The University of Houston reported that the percentage of Texans without electricity during February 14-20 was 69%.

Referred measures on the Texas ballot

See also: List of Texas ballot measures

In Texas, a total of 281 ballot measures appeared on statewide ballots between 1985 and 2022. Two hundred forty-eight ballot measures were approved, and 33 ballot measures were defeated.

Texas statewide ballot measures, 1985-2022
Total number	Annual average	Annual minimum	Annual maximum	Approved		Defeated
				#	%	#	%
281	6.39	0	22	248	88.26	33	11.74

Texas ballot measures in odd-numbered years

Between 1995 and 2021, Texans decided on 175 statewide ballot measures appearing on odd-numbered year ballots. Voters approved 160 measures and defeated 15.

Path to the ballot

See also: Amending the Texas Constitution

To put a legislatively referred constitutional amendment before voters, a two-thirds (66.67%) vote is required in both the Texas State Senate and the Texas House of Representatives.

This amendment was introduced as Senate Joint Resolution 93 on May 1, 2023. On May 4, 2023, the state Senate passed SJR 93 by a vote of 27-4. The state House passed an amended version of SJR 93 on May 22 by a vote of 103-35 with 11 not voting or absent. The Senate passed the amended version on May 28 by a vote of 27-4.

Vote in the Texas House of Representatives May 22, 2023
Requirement: Two-thirds (66.67 percent) vote of all members in each chamber
Number of yes votes required: 100  a
	Yes	No	Not voting
Total	103	35	11
Total percent	69.1%	23.5%	7.4%
Democrat	27	30	7
Republican	76	5	4

Vote in the Texas State Senate May 28, 2023
Requirement: Two-thirds (66.67 percent) vote of all members in each chamber
Number of yes votes required: 21  a
	Yes	No	Not voting
Total	27	4	0
Total percent	87.1%	12.9%	0.0%
Democrat	9	3	0
Republican	18	1	0

How to cast a vote

See also: Voting in Texas

Click "Show" to learn more about voter registration, identification requirements, and poll times in Texas.

How to cast a vote in Texas

Poll times In Texas, all polling places are open from 7 a.m. to 7 p.m. Central Time. An individual who is in line at the time polls close must be allowed to vote. Texas is divided between Central and Mountain time zones. Registration Check your voter registration status here. To register to vote in Texas, an applicant must be a United States citizen, a resident of the county in which he or she is registering, and at least 17 years and 10 months old. The deadline to register to vote is 30 days before the election. Prospective voters can request a postage-paid voter registration form online or complete the form online and return it to the county voter registrar. Applications are also available at a variety of locations including the county voter registrar’s office, the secretary of state’s office, libraries, and high schools. Voter registration certificates are mailed to newly registered voters. Automatic registration Texas does not practice automatic voter registration. Online registration See also: Online voter registration Texas does not permit online voter registration. Same-day registration Texas does not allow same-day voter registration. Residency requirements Prospective voters must reside in the county in which they are registering to vote. Verification of citizenship See also: Laws permitting noncitizens to vote in the United States Texas does not require proof of citizenship for voter registration. Section 18.068 of the Texas Election Code says the following: “ The secretary of state shall quarterly compare the information received under Section 16.001 of this code and Section 62.113, Government Code, to the statewide computerized voter registration list. If the secretary determines that a voter on the registration list is deceased or has been excused or disqualified from jury service because the voter is not a citizen, the secretary shall send notice of the determination to the voter registrar of the counties considered appropriate by the secretary. ” —Section 18.068, Texas Election Code In January 2019, the Texas secretary of state’s office announced that it would be providing local election officials with a list of registered voters who obtained driver’s licenses or IDs with documentation such as work visas or green cards. Counties would then be able to require voters on the list to provide proof of citizenship within 30 days. The review was halted by a federal judge in February 2019, and Secretary of State David Whitley rescinded the advisory in April. A news release from Whitley’s office stated that “... going forward, the Texas Secretary of State's office will send to county voter registrars only the matching records of individuals who registered to vote before identifying themselves as non-U.S. citizens to DPS when applying for a driver's license or personal identification card. This will ensure that naturalized U.S. citizens who lawfully registered to vote are not impacted by this voter registration list maintenance process.” Verifying your registration The Texas Secretary of State’s office allows residents to check their voter registration status online by visiting this website. Voter ID requirements Texas requires voters to present photo identification while voting. The following list of accepted ID was current as of February 2023. Click here for the Texas Secretary of State's page on accepted ID to ensure you have the most current information. Texas driver’s license issued by the Texas Department of Public Safety (DPS) Texas Election Identification Certificate issued by DPS Texas Personal Identification Card issued by DPS Texas handgun license issued by DPS United States Military Identification Card containing the person’s photograph United States Citizenship Certificate containing the person’s photograph United States passport (book or card) Identification provided by voters aged 18-69 may be expired for no more than four years before the election date. Voters aged 70 and older can use an expired ID card regardless of how long ago the ID expired. Voters who are unable to provide one of the ID options listed above can sign a Reasonable Impediment Declaration and provide one of the following supporting documents: Copy or original of a government document that shows the voter’s name and an address, including the voter’s voter registration certificate Copy of or original current utility bill Copy of or original bank statement Copy of or original government check Copy of or original paycheck Copy of or original of (a) a certified domestic (from a U.S. state or territory) birth certificate or (b) a document confirming birth admissible in a court of law which establishes the voter’s identity (which may include a foreign birth document) The following voters are exempt from showing photo ID: Voters with a disability Voters with a disability "may apply with the county voter registrar for a permanent exemption to presenting an acceptable photo identification or following the Reasonable Impediment Declaration procedure in the county." Voters who have a religious objection to being photographed Voters who do not have a photo ID can obtain a Texas Election Identification Certificate (EIC) at any Texas driver’s license office during regular business hours. Voters can also obtain an Election Identification Certificate from a mobile station. Locations are listed here.

See also

2023 measures

• 2023 ballot measures
• Utilities on the ballot
• Energy on the ballot
• 2023 legislative sessions

Texas

• Texas ballot measures
• Texas ballot measure laws

News and analysis

• Ballot measure lawsuits
• Ballot measure readability
• Ballot measure polls

External links

• Texas Senate Joint Resolution 93