H.B. No. 405 proposes amendments to the Agriculture Code regarding fees and grants associated with the production of fuel ethanol, renewable methane, biodiesel, and renewable diesel. The bill reenacts Section 16.005(a), which establishes a fee structure for producers, setting the fee at 3.2 cents per gallon for fuel ethanol, renewable diesel, or MMBtu of renewable methane, and 1.6 cents per gallon for biodiesel produced at registered plants. Additionally, Section 16.006(b) is reenacted to specify that producers are entitled to receive grants of 20 cents per gallon for fuel ethanol, renewable diesel, or MMBtu of renewable methane, and 10 cents per gallon for biodiesel, for a period of up to ten years from the start of production at their plants.

The bill aims to support the renewable energy sector by maintaining a consistent fee and grant structure for producers, thereby encouraging the production of alternative fuels. The act will take effect immediately upon receiving a two-thirds majority vote from both houses of the legislature; otherwise, it will become effective on September 1, 2025.