Legislative Session: 87(R)

Senate Bill 3

Senate Author:  Schwertner et al.

Effective:  6-8-21

House Sponsor:  Paddie

            Senate Bill 3, an omnibus bill enacted in response to Winter Storm Uri, amends the Government Code, Natural Resources Code, Utilities Code, and Water Code to set out provisions relating to preparing for, preventing, and responding to weather emergencies and power outages. Among other provisions, the bill does the following:

·        requires the weatherization of certain gas supply chain and gas pipeline facilities and certain entities that sell electric energy or provide transmission service in the ERCOT power region and provides penalties of up to $1 million for violating applicable weatherization requirements;

·        requires ERCOT to establish requirements to meet the reliability needs of the ERCOT power region; procure dispatchable ancillary or reliability services to ensure appropriate reliability during extreme heat and extreme cold weather conditions and during times of low non‑dispatchable power production; and develop appropriate qualification and performance requirements for providing those services, including appropriate penalties for failure to provide the services;

·        provides for the designation of certain natural gas facilities and associated entities as critical for power delivery and load‑shedding purposes during an energy emergency;

·        provides for the development and implementation of an alert to be activated when the power supply in Texas may be inadequate to meet demand;

·        provides for the allocation of load shedding among certain market participants in the ERCOT power region during an involuntary load shedding event initiated by ERCOT during an energy emergency and for the development of voluntary load shedding programs to reduce use when necessary;

·        requires the Public Utility Commission of Texas (PUC) and ERCOT to conduct simulated or tabletop load shedding exercises with providers of electric generation service and transmission and distribution service in the ERCOT power region;

·        requires the PUC to review and evaluate whether additional ancillary services are needed for reliability in the ERCOT power region;

·        requires the PUC to establish a wholesale electric market emergency pricing program that takes effect if the high system‑wide offer cap has been in effect for 12 hours in a 24‑hour period after initially reaching the high system‑wide offer cap;

·        establishes the Texas Energy Reliability Council to ensure that high priority human needs are met and critical infrastructure concerns are addressed and to enhance coordination and communication in the energy and electric industries in Texas;

·        requires an owner or operator of commercial distributed generation to register with ERCOT and provide interconnecting transmission and distribution utility information necessary for the interconnection of the distributed generator;

·        establishes the Texas Electricity Supply Chain Security and Mapping Committee to map and identify critical infrastructure sources in the electricity supply chain in Texas; establish best practices for maintaining service in an extreme weather event; and designate priority service needs to prepare for, respond to, and recover from such an event;

·        requires the Railroad Commission of Texas to analyze emergency operations plans developed by operators of applicable natural gas facilities and prepare and submit a biennial weather emergency preparedness report regarding those facilities to the lieutenant governor, the speaker of the house of representatives, and the members of the legislature;

·        sets the amount of the civil penalty for disconnecting natural gas service to residential customers during an extreme weather emergency at up to $1 million;

·        provides for the development of emergency operations standards and emergency preparedness plans for certain retail public utilities, exempt utilities, and providers or conveyors of potable or raw water service;

·        prohibits the imposition of late fees or the disconnection of retail water or sewer utility service for nonpayment of bills that are due during an extreme weather emergency until after the emergency is over and requires that requesting customers be allowed to set up a payment schedule for the unpaid bills;

·        establishes the State Energy Plan Advisory Committee for purposes of preparing a comprehensive state energy plan to submit to the legislature; and

·        requires the PUC and ERCOT to annually review and submit a report to the legislature on the effect of certain statutes, rules, protocols, and bylaws on the ability of the PUC and ERCOT to fulfill their respective duties.