Texas Enacts Law for Battery Energy Storage System Decommissioning Procedures

Texas Governor Signs Law for Decommissioning Battery Energy Storage Systems

Texas Governor Greg Abbott has enacted a law establishing decommissioning procedures for battery energy storage system (BESS) facilities as they reach the end of their operational lifecycle. House Bill No. 3809 (HB 3809) was signed into law on May 29 and is set to take effect on September 1. This legislation specifically applies to BESS projects that are not owned by electric utilities.

Inspired by similar regulations for decommissioning wind and solar facilities in Texas, HB 3809 contains two main provisions: it mandates the decommissioning of BESS facilities, including the removal of equipment and land restoration, and it requires financial assurance to cover decommissioning costs.

### Decommissioning Requirements for BESS Facilities

The law stipulates that standalone BESS projects and those co-located with solar or wind energy must be decommissioned at the end of their lifecycle unless they are to be repowered. Unlike existing regulations that apply to projects sharing an interconnection point, HB 3809 covers projects without such shared connections.

Project owners are required to remove all battery storage equipment, which includes battery units, transformers, substations, buried cables, and power lines. Foundations need to be excavated to at least three feet below the surface. Furthermore, landowners may request that lessees remove access roads, large rocks, reseed pastureland with native grasses, restore the land to a condition suitable for tilling through appropriate soil treatment methods, and ensure that all recyclable materials are collected and sent for recycling.

### Financial Assurance for Decommissioning Costs

HB 3809 mandates that non-utility BESS lessees provide financial assurance to ensure compliance with the decommissioning obligations. Project owners must guarantee funding for the removal process. This financial assurance must cover the estimated costs of removal, land restoration, and recycling, minus any salvage value. Cost estimates must be generated by a licensed, independent engineer in Texas and should be updated regularly.

The financial assurance must be in place before the termination of the facility lease or by the facility’s 15th anniversary.

### Legislative Context

During Texas’s 89th Legislative Session, various other bills related to energy storage and clean energy have been proposed. However, HB 3809 is the only one that Governor Abbott has signed so far. Other introduced bills include Senate Bill 388 (SB 388), Senate Bill 715 (SB 715), and Senate Bill 819 (SB 819).

If passed, SB 388 would require that 50% of the generating capacity installed in the Electric Reliability Council of Texas (ERCOT) service area be derived from dispatchable generation sources other than battery energy storage after January 1, 2026. SB 388 has been referred to State Affairs and is currently adjourned without a scheduled date for reconvening.

SB 715, along with its companion House Bill 3356, would retroactively impose firming requirements on renewable energy facilities, potentially destabilizing the market and causing the premature retirement of up to 5 GW of wind generation capacity by 2026. An analysis by power market analytics firm Aurora Energy Research indicates that implementing this bill could lead to increased electricity costs for consumers and reduced system reliability.

Lastly, SB 819 would require wind and solar projects to obtain permits from the Public Utility Commission (PUC), a requirement not applicable to coal, gas, or nuclear energy projects. The Solar Energy Industries Association (SEIA) has criticized SB 819 for adding burdensome requirements to new solar projects, warning that it could impede the state’s ability to meet growing energy demands by making it more challenging and expensive to develop new clean energy initiatives. This bill has also been adjourned without a set date for further discussion.

### Upcoming Events

– **UK Solar Summit 2025**: July 1, 2025, London, UK
– **Wind Power Finance & Investment Summit**: July 1, 2025, London, UK
– **Battery Asset Management Summit 2025**: November 11, 2025, San Diego, USA
– **Energy Storage Summit 2026**: February 24, 2026, London, UK

This new legislation represents a significant step in regulating the lifecycle management of battery energy storage systems in Texas, ensuring that decommissioning processes are carried out responsibly and sustainably.