By: Armbrister S.B. No. 373
A BILL TO BE ENTITLED
AN ACT
1-1 relating to the continuation, operations, and functions of the
1-2 Public Utility Commission of Texas and the Office of Public Utility
1-3 Counsel; providing penalties.
1-4 BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
1-5 ARTICLE 1
1-6 SECTION 1.01. Section 1.003, Public Utility Regulatory Act
1-7 of 1995, as enacted by S.B. No. 319, Acts of the 74th Legislature,
1-8 Regular Session, 1995, is amended by amending Subdivision (14) and
1-9 by adding Subdivisions (13A) and (18) to read as follows:
1-10 (13A) The term "ratemaking proceeding" is limited to
1-11 those proceedings in which rates are changed, except the term shall
1-12 include proceedings initiated under Section 2.051 of this Act.
1-13 (14) "Rate" means and includes every compensation,
1-14 tariff, charge, fare, toll, rental, and classification, or any of
1-15 them demanded, observed, charged, or collected whether directly or
1-16 indirectly by any public utility for any service, product, or
1-17 commodity described in the definition of "utility" in Section 2.001
1-18 or 3.001 of this Act and any rules, regulations, practices, or
1-19 contracts affecting any such compensation, tariff, charge, fare,
1-20 toll, rental, or classification, that must be approved by a
1-21 regulatory authority. Prices as defined in Section 2.0011 of this
1-22 Act that are charged to individual customers for electric service
1-23 shall not be considered a "rate."
1-24 (18) "Trade association" means a nonprofit,
2-1 cooperative, and voluntarily joined association of business or
2-2 professional persons who are employed by public utilities or
2-3 utility competitors to assist the public utility industry, a
2-4 utility competitor, or the industry's or competitor's employees in
2-5 dealing with mutual business or professional problems and in
2-6 promoting their common interest.
2-7 SECTION 1.02. Section 1.005, Public Utility Regulatory Act
2-8 of 1995, as enacted by S.B. No. 319, Acts of the 74th Legislature,
2-9 Regular Session, 1995, is amended to read as follows:
2-10 Sec. 1.005. APPLICABILITY OF ADMINISTRATIVE PROCEDURE ACT
2-11 AND OPEN MEETINGS LAW. (a) Chapter 2001, Government Code, applies
2-12 to all proceedings under this Act except to the extent inconsistent
2-13 with this Act. Communications of members and employees of the
2-14 commission with a party, a party's representative, or other persons
2-15 are governed by Section 2001.061, Government Code.
2-16 (b) The commission is subject to Chapter 551, Government
2-17 Code.
2-18 SECTION 1.03. Subtitle A, Title I, Public Utility Regulatory
2-19 Act of 1995, as enacted by S.B. No. 319, Acts of the 74th
2-20 Legislature, Regular Session, 1995, is amended by adding Section
2-21 1.006 to read as follows:
2-22 Sec. 1.006. ENTITY, COMPETITOR, OR SUPPLIER AFFECTED IN
2-23 MANNER OTHER THAN BY SETTING OF RATES. In this Act, an entity,
2-24 utility competitor, or utility supplier is considered to be
2-25 affected in a manner other than by the setting of rates for that
2-26 class of customer if during a relevant calendar year the entity
2-27 provides fuel, utility-related goods, utility-related products, or
3-1 utility-related services to a regulated or unregulated provider of
3-2 telecommunications or electric services or to an affiliated
3-3 interest in an amount equal to the greater of $10,000 or 10 percent
3-4 of the person's business.
3-5 SECTION 1.04. Subsections (c) and (d), Section 1.021, Public
3-6 Utility Regulatory Act of 1995, as enacted by S.B. No. 319, Acts of
3-7 the 74th Legislature, Regular Session, 1995, are amended to read as
3-8 follows:
3-9 (c) The governor shall designate a member of the commission
3-10 as presiding officer of the commission to serve in that capacity at
3-11 the pleasure of the governor. <At its first meeting following the
3-12 biennial appointment and qualification of a commissioner, the
3-13 commission shall elect one of the commissioners chairman.>
3-14 (d) Appointments to the commission shall be made without
3-15 regard to the race, color, disability <creed>, sex, religion, age,
3-16 or national origin of the appointees.
3-17 SECTION 1.05. Section 1.022, Public Utility Regulatory Act
3-18 of 1995, as enacted by S.B. No. 319, Acts of the 74th Legislature,
3-19 Regular Session, 1995, is amended to read as follows:
3-20 Sec. 1.022. SUNSET PROVISION. The Public Utility Commission
3-21 of Texas and the Office of Public Utility Counsel are subject to
3-22 Chapter 325, Government Code (Texas Sunset Act). Unless continued
3-23 in existence as provided by that chapter, the commission and the
3-24 office are abolished and this Act expires September 1, 2001 <1995>.
3-25 SECTION 1.06. Section 1.023, Public Utility Regulatory Act
3-26 of 1995, as enacted by S.B. No. 319, Acts of the 74th Legislature,
3-27 Regular Session, 1995, is amended to read as follows:
4-1 Sec. 1.023. QUALIFICATIONS; OATH <AND BOND>; PROHIBITED
4-2 ACTIVITIES. (a) To be eligible for appointment as a commissioner,
4-3 a person must be a qualified voter, <not less than 30 years of
4-4 age,> a citizen of the United States, <and> a resident of the State
4-5 of Texas, and a representative of the general public.
4-6 (b) Each commissioner shall qualify for office by taking the
4-7 oath prescribed for other state officers <and shall execute a bond
4-8 for $5,000 payable to the state and conditioned on the faithful
4-9 performance of his duties>.
4-10 (c) A person is not eligible for appointment as a
4-11 commissioner if at any time during the two-year period immediately
4-12 preceding his appointment he personally served as an officer,
4-13 director, owner, employee, partner, or legal representative of any
4-14 public utility, <or any> affiliated interest, or direct competitor
4-15 of a public utility or he owned or controlled, directly or
4-16 indirectly, stocks or bonds of any class with a value of $10,000 or
4-17 more in a public utility, <or any> affiliated interest, or direct
4-18 competitor of a public utility.
4-19 (d) A person who is required to register as a lobbyist under
4-20 Chapter 305, Government Code, because of the person's activities
4-21 for compensation on behalf of a profession related to the operation
4-22 of the commission may not serve as a member of the commission or
4-23 public utility counsel or act as the general counsel to the
4-24 commission.
4-25 (e) A person is not eligible for appointment as a public
4-26 member of the commission or for employment as the general counsel
4-27 or executive director of the commission if:
5-1 (1) the person serves on the board of directors of a
5-2 company that supplies fuel, utility-related services, or
5-3 utility-related products to regulated or unregulated electric or
5-4 telecommunications utilities; or
5-5 (2) the person or the person's spouse:
5-6 (A) is employed by or participates in the
5-7 management of a business entity or other organization regulated by
5-8 the commission or receiving funds from the commission;
5-9 (B) owns or controls, directly or indirectly,
5-10 more than a 10 percent interest or a pecuniary interest with a
5-11 value exceeding $10,000 in:
5-12 (i) a business entity or other
5-13 organization regulated by the commission or receiving funds from
5-14 the commission; or
5-15 (ii) any utility competitor, utility
5-16 supplier, or other entity affected by a commission decision in a
5-17 manner other than by the setting of rates for that class of
5-18 customer;
5-19 (C) uses or receives a substantial amount of
5-20 tangible goods, services, or funds from the commission, other than
5-21 compensation or reimbursement authorized by law for commission
5-22 membership, attendance, or expenses; or
5-23 (D) notwithstanding Paragraph (B) of this
5-24 subdivision, has an interest in a mutual fund or retirement fund in
5-25 which more than 10 percent of the fund's holdings at the time of
5-26 appointment is in a single utility, utility competitor, or utility
5-27 supplier in this state and the person does not disclose this
6-1 information to the governor, senate, commission, or other entity,
6-2 as appropriate.
6-3 (f) Notwithstanding any other provision of this Act, a
6-4 person otherwise ineligible because of the application of
6-5 Subsection (e)(2)(B) of this section may be appointed to the
6-6 commission and serve as a commissioner or may be employed as the
6-7 general counsel or executive director if the person:
6-8 (1) notifies the attorney general and commission that
6-9 the person is ineligible because of the application of Subsection
6-10 (e)(2)(B) of this section; and
6-11 (2) divests the person or the person's spouse of the
6-12 ownership or control before beginning service or employment, or
6-13 within a reasonable time if the person is already serving or
6-14 employed at the time Subsection (e)(2)(B) of this section first
6-15 applies to the person.
6-16 (g) An officer, employee, or paid consultant of a trade
6-17 association in the field of public utilities may not be a member or
6-18 employee of the commission who is exempt from the state's position
6-19 classification plan or is compensated at or above the amount
6-20 prescribed by the General Appropriations Act for step 1, salary
6-21 group 17, of the position classification salary schedule.
6-22 (h) A person who is a spouse of an officer, manager, or paid
6-23 consultant of a trade association in the field of public utilities
6-24 may not be a commission member and may not be a commission employee
6-25 who is exempt from the state's position classification plan or is
6-26 compensated at or above the amount prescribed by the General
6-27 Appropriations Act for step 1, salary group 17, of the position
7-1 classification salary schedule.
7-2 SECTION 1.07. Subsections (a), (d), and (e), Section 1.024,
7-3 Public Utility Regulatory Act of 1995, as enacted by S.B. No. 319,
7-4 Acts of the 74th Legislature, Regular Session, 1995, are amended to
7-5 read as follows:
7-6 (a) A commissioner or employee of the commission may not do
7-7 any of the following during his period of service with the
7-8 commission:
7-9 (1) have any pecuniary interest, either as an officer,
7-10 director, partner, owner, employee, attorney, consultant, or
7-11 otherwise, in any public utility or affiliated interest, or in any
7-12 person or corporation or other business entity a significant
7-13 portion of whose business consists of furnishing goods or services
7-14 to public utilities or affiliated interests, but not including a
7-15 nonprofit group or association solely supported by gratuitous
7-16 contributions of money, property or services, other than a trade
7-17 association;
7-18 (2) own or control any securities in a public utility,
7-19 <or> affiliated interest, or direct competitor of a public utility,
7-20 either directly or indirectly; or
7-21 (3) accept any gift, gratuity, or entertainment
7-22 whatsoever from any public utility, <or> affiliated interest, or
7-23 direct competitor of a public utility, or from any person,
7-24 corporation, agent, representative, employee, or other business
7-25 entity a significant portion of whose business consists of
7-26 furnishing goods or services to public utilities, <or> affiliated
7-27 interests, or direct competitors of public utilities, or from any
8-1 agent, representative, attorney, employee, officer, owner,
8-2 director, or partner of any such business entity or of any public
8-3 utility, <or> affiliated interest, or direct competitor of a public
8-4 utility; provided, however, that the receipt and acceptance of any
8-5 gifts, gratuities, or entertainment after termination of service
8-6 with the commission whose cumulative value in any one-year period
8-7 is less than $100 does not constitute a violation of this Act.
8-8 (d) A public utility, <or> affiliated interest, or direct
8-9 competitor of a public utility, or any person, corporation, firm,
8-10 association, or business that furnishes goods or services to any
8-11 public utility, <or> affiliated interest, or direct competitor of a
8-12 public utility, or any agent, representative, attorney, employee,
8-13 officer, owner, director, or partner of any public utility, <or>
8-14 affiliated interest, or direct competitor of a public utility, or
8-15 any person, corporation, firm, association, or business furnishing
8-16 goods or services to any public utility, <or> affiliated interest,
8-17 or direct competitor of a public utility may not give or offer to
8-18 give any gift, gratuity, employment, or entertainment whatsoever to
8-19 any member or employee of the commission except as allowed by
8-20 Subdivision (3) of Subsection (a) of this section, nor may any such
8-21 public utility, <or> affiliated interest, or direct competitor of a
8-22 public utility or any such person, corporation, firm, association,
8-23 or business aid, abet, or participate with any member, employee, or
8-24 former employee of the commission in any activity or conduct that
8-25 would constitute a violation of this subsection or Subdivision (3)
8-26 of Subsection (a) of this section.
8-27 (e) It is not a violation of this section if a member of the
9-1 commission or a person employed by the commission, upon becoming
9-2 the owner of any stocks or bonds or other pecuniary interest in a
9-3 public utility, <or> affiliated interest, or direct competitor of a
9-4 public utility <under the jurisdiction of the commission> otherwise
9-5 than voluntarily, informs the commission and the attorney general
9-6 of such ownership and divests himself of the ownership or interest
9-7 within a reasonable time. In this section, a "pecuniary interest"
9-8 includes income, compensation, and payment of any kind, in addition
9-9 to ownership interests. It is not a violation of this section if
9-10 such a pecuniary interest is held indirectly by ownership of an
9-11 interest in a retirement system, institution, or fund which in the
9-12 normal course of business invests in diverse securities
9-13 independently of the control of the commissioner or employee.
9-14 SECTION 1.08. Section 1.025, Public Utility Regulatory Act
9-15 of 1995, as enacted by S.B. No. 319, Acts of the 74th Legislature,
9-16 Regular Session, 1995, is amended to read as follows:
9-17 Sec. 1.025. PROHIBITION OF EMPLOYMENT OR REPRESENTATION.
9-18 (a) A commissioner may not within two years, and an employee of
9-19 the commission or an employee of the State Office of Administrative
9-20 Hearings involved in hearing utility cases may not, within one year
9-21 after his employment with the commission or the State Office of
9-22 Administrative Hearings has ceased, be employed by a public utility
9-23 which was in the scope of the commissioner's or employee's official
9-24 responsibility while the commissioner or employee was associated
9-25 with the commission or the State Office of Administrative Hearings.
9-26 (b) During the time a commissioner or employee of the
9-27 commission or an employee of the State Office of Administrative
10-1 Hearings involved in hearing utility cases is associated with the
10-2 commission or State Office of Administrative Hearings or at any
10-3 time after, the commissioner or employee may not represent a
10-4 person, corporation, or other business entity before the commission
10-5 or State Office of Administrative Hearings or a court in a matter
10-6 in which the commissioner or employee was personally involved while
10-7 associated with the commission or State Office of Administrative
10-8 Hearings or a matter that was within the commissioner's or
10-9 employee's official responsibility while the commissioner or
10-10 employee was associated with the commission or State Office of
10-11 Administrative Hearings.
10-12 (c) The commission shall require its members and employees
10-13 to read this section and Section 1.024 of this Act and as often as
10-14 necessary shall provide information regarding their qualifications
10-15 for office or employment under this Act and their responsibilities
10-16 under applicable laws relating to standards of conduct for state
10-17 officers and employees.
10-18 SECTION 1.09. Section 1.026, Public Utility Regulatory Act
10-19 of 1995, as enacted by S.B. No. 319, Acts of the 74th Legislature,
10-20 Regular Session, 1995, is amended to read as follows:
10-21 Sec. 1.026. GROUNDS FOR REMOVAL; VALIDITY OF ACTIONS.
10-22 (a) It is a ground for removal from the commission if a member:
10-23 (1) does not have at the time of appointment the
10-24 qualifications required by Section 1.023 of this Act <for
10-25 appointment to the commission>; <or>
10-26 (2) does not maintain during <the> service on the
10-27 commission the qualifications required by Section 1.023 of this
11-1 Act;
11-2 (3) violates a prohibition established by Section
11-3 1.023, 1.024, or 1.025 of this Act;
11-4 (4) cannot discharge the member's duties for a
11-5 substantial part of the term for which the member is appointed
11-6 because of illness or disability; or
11-7 (5) is absent from more than half of the regularly
11-8 scheduled commission meetings that the member is eligible to attend
11-9 during a calendar year unless the absence is excused by majority
11-10 vote of <for appointment to> the commission.
11-11 (b) The validity of an action of the commission is not
11-12 affected by the fact that it is <was> taken when a ground for
11-13 removal of a commission member exists <of the commission existed>.
11-14 (c) If the executive director has knowledge that a potential
11-15 ground for removal exists, the executive director shall notify the
11-16 presiding officer of the commission of the potential ground. The
11-17 presiding officer shall then notify the governor and the attorney
11-18 general that a potential ground for removal exists. If the
11-19 potential ground for removal involves the presiding officer of the
11-20 commission, the executive director shall notify the next highest
11-21 officer of the commission, who shall notify the governor and the
11-22 attorney general that a potential ground for removal exists.
11-23 (d) Before a member of the commission may assume the
11-24 member's duties and before the member may be confirmed by the
11-25 senate, the member must complete at least one course of the
11-26 training program established under this section.
11-27 (e) A training program established under this section shall
12-1 provide information to the member regarding:
12-2 (1) the enabling legislation that created the
12-3 commission and its policymaking body to which the member is
12-4 appointed to serve;
12-5 (2) the programs operated by the commission;
12-6 (3) the role and functions of the commission;
12-7 (4) the rules of the commission with an emphasis on
12-8 the rules that relate to disciplinary and investigatory authority;
12-9 (5) the current budget for the commission;
12-10 (6) the results of the most recent formal audit of the
12-11 commission;
12-12 (7) the requirements of Chapters 551, 552, and 2001,
12-13 Government Code;
12-14 (8) the requirements of the conflict of interest laws
12-15 and other laws relating to public officials; and
12-16 (9) any applicable ethics policies adopted by the
12-17 commission or the Texas Ethics Commission.
12-18 SECTION 1.10. Subsections (a), (b), and (e), Section 1.028,
12-19 Public Utility Regulatory Act of 1995, as enacted by S.B. No. 319,
12-20 Acts of the 74th Legislature, Regular Session, 1995, are amended to
12-21 read as follows:
12-22 (a) The commission shall employ an executive director, a
12-23 general counsel, and such officers<, administrative law judges,
12-24 hearing examiners, investigators, lawyers, engineers, economists,
12-25 consultants, statisticians, accountants, administrative assistants,
12-26 inspectors, clerical staff,> and other employees as it deems
12-27 necessary to carry out the provisions of this Act. All employees
13-1 receive such compensation as is fixed by the legislature. The
13-2 commission shall develop and implement policies that clearly define
13-3 the respective responsibilities of the commission and the staff of
13-4 the commission.
13-5 (b) The executive director is responsible for the day-to-day
13-6 operations of the commission and shall coordinate the activities of
13-7 commission employees <commission shall employ the following:>
13-8 <(1) an executive director;>
13-9 <(2) a director of hearings who has wide experience in
13-10 utility regulation and rate determination;>
13-11 <(3) a chief engineer who is a registered engineer and
13-12 an expert in public utility engineering and rate matters;>
13-13 <(4) a chief accountant who is a certified public
13-14 accountant, experienced in public utility accounting;>
13-15 <(5) a director of research who is experienced in the
13-16 conduct of analyses of industry, economics, energy, fuel, and other
13-17 related matters that the commission may want to undertake;>
13-18 <(6) a director of consumer affairs and public
13-19 information;>
13-20 <(7) a director of utility evaluation;>
13-21 <(8) a director of energy conservation; and>
13-22 <(9) a general counsel.>
13-23 <(e) The commission shall employ administrative law judges
13-24 to preside at hearings of major importance before the commission.
13-25 An administrative law judge must be a licensed attorney with not
13-26 less than five years' general experience or three years' experience
13-27 in utility regulatory law. The administrative law judge shall
14-1 perform his duties independently from the commission>.
14-2 SECTION 1.11. Section 1.029, Public Utility Regulatory Act
14-3 of 1995, as enacted by S.B. No. 319, Acts of the 74th Legislature,
14-4 Regular Session, 1995, is amended to read as follows:
14-5 Sec. 1.029. PERSONNEL POLICIES. (a) The executive director
14-6 or the executive director's <his> designee shall develop an
14-7 intra-agency career ladder program that addresses opportunities for
14-8 mobility and advancement for employees of the commission. The
14-9 program shall require intra-agency posting of all positions
14-10 concurrently with<, one part of which shall be the intra-agency
14-11 posting of all nonentry level positions for at least 10 days
14-12 before> any public posting. The executive director or the
14-13 executive director's <his> designee shall develop a system of
14-14 annual performance evaluations that are based on documented
14-15 employee performance <measurable job tasks>. All merit pay for
14-16 commission employees must be based on the system established under
14-17 this section.
14-18 (b) The executive director or the executive director's
14-19 <his/her> designee shall prepare and maintain a written policy
14-20 statement <plan> to assure implementation of a program of equal
14-21 employment opportunity under which <whereby> all personnel
14-22 transactions are made without regard to race, color, disability,
14-23 sex, religion, age, or national origin. The policy statement must
14-24 <plan shall> include:
14-25 (1) personnel policies that comply with Chapter 21,
14-26 Labor Code, including policies relating to recruitment, evaluation,
14-27 selection, appointment, training, and promotion of personnel;
15-1 (2) a comprehensive analysis of the commission
15-2 workforce that meets federal and state guidelines;
15-3 (3) procedures by which a determination can be made
15-4 about the extent of underuse in the commission workforce of all
15-5 persons for whom federal or state guidelines encourage a more
15-6 equitable balance; and
15-7 (4) reasonable methods to appropriately address the
15-8 underuse. <a comprehensive analysis of all the agency's workforce
15-9 by race, sex, ethnic origin, class of position, and salary or wage;>
15-10 <(2) plans for recruitment, evaluation, selection,
15-11 appointment, training, promotion, and other personnel policies;>
15-12 <(3) steps reasonably designed to overcome any
15-13 identified underutilization of minorities and women in the agency's
15-14 workforce; and>
15-15 <(4) objectives and goals, timetables for the
15-16 achievement of the objectives and goals, and assignments of
15-17 responsibility for their achievement.>
15-18 (c) The policy statement <plan> required under Subsection
15-19 (b) of this section must <shall be filed with the governor's office
15-20 within 60 days of the effective date of this Act,> cover an annual
15-21 period, <and> be updated at least annually and reviewed by the
15-22 Commission on Human Rights for compliance with Subsection (b)(1) of
15-23 this section, and<. Progress reports shall> be filed with
15-24 <submitted to> the governor's office <within 30 days of November 1
15-25 and April 1 of each year and shall include the steps the agency has
15-26 taken within the reporting period to comply with these
15-27 requirements>.
16-1 (d) The governor's office shall deliver a biennial report to
16-2 the legislature based on the information received under Subsection
16-3 (c) of this section. The report may be made separately or as a
16-4 part of other biennial reports made to the legislature.
16-5 SECTION 1.12. Section 1.031, Public Utility Regulatory Act
16-6 of 1995, as enacted by S.B. No. 319, Acts of the 74th Legislature,
16-7 Regular Session, 1995, is amended to read as follows:
16-8 Sec. 1.031. OFFICE; MEETINGS. (a) The principal office of
16-9 the commission shall be located in the City of Austin, Texas, and
16-10 shall be open daily during the usual business hours, Saturdays,
16-11 Sundays, and legal holidays excepted. The commission shall hold
16-12 meetings at its office and at such other convenient places in the
16-13 state as shall be expedient and necessary for the proper
16-14 performance of its duties.
16-15 (b) The commission shall develop and implement policies that
16-16 provide the public with a reasonable opportunity to appear before
16-17 the commission and to speak on any issue under the jurisdiction of
16-18 the commission.
16-19 SECTION 1.13. Subsection (a), Section 1.035, Public Utility
16-20 Regulatory Act of 1995, as enacted by S.B. No. 319, Acts of the
16-21 74th Legislature, Regular Session, 1995, is amended to read as
16-22 follows:
16-23 (a) The commission shall prepare annually a complete and
16-24 detailed written report accounting for all funds received and
16-25 disbursed by the commission during the preceding fiscal year. The
16-26 annual report must meet the reporting requirements applicable to
16-27 financial reporting in the General Appropriations Act <publish an
17-1 annual report to the governor, summarizing its proceedings, listing
17-2 its receipts and the sources of its receipts, listing its
17-3 expenditures and the nature of such expenditures, and setting forth
17-4 such other information concerning the operations of the commission
17-5 and the public utility industry as it considers of general
17-6 interest>.
17-7 SECTION 1.14. Section 1.036, Public Utility Regulatory Act
17-8 of 1995, as enacted by S.B. No. 319, Acts of the 74th Legislature,
17-9 Regular Session, 1995, is amended to read as follows:
17-10 Sec. 1.036. <CONSUMER> INFORMATION; ACCESSIBILITY. (a) The
17-11 commission shall prepare information of public <consumer> interest
17-12 describing the <regulatory> functions of the commission and
17-13 <describing> the commission's procedures by which <consumer>
17-14 complaints are filed with and resolved by the commission. The
17-15 commission shall make the information available to the <general>
17-16 public and appropriate state agencies.
17-17 (b) The commission by rule shall establish methods by which
17-18 consumers and service recipients are notified of the name, mailing
17-19 address, and telephone number of the commission for the purpose of
17-20 directing complaints to the commission.
17-21 (c) The commission shall comply with federal and state laws
17-22 related to program and facility accessibility. The commission
17-23 shall also prepare and maintain a written plan that describes how a
17-24 person who does not speak English can be provided reasonable access
17-25 to the commission's programs and services.
17-26 SECTION 1.15. Section 1.051, Public Utility Regulatory Act
17-27 of 1995, as enacted by S.B. No. 319, Acts of the 74th Legislature,
18-1 Regular Session, 1995, is amended to read as follows:
18-2 Sec. 1.051. OFFICE OF PUBLIC UTILITY COUNSEL. (a) The
18-3 independent Office of Public Utility Counsel represents the
18-4 interests of residential and small commercial consumers.
18-5 (b) The chief executive of the office <Office of Public
18-6 Utility Counsel> is the public utility counsel, hereinafter
18-7 referred to as counsellor. The counsellor is appointed by the
18-8 governor with the advice and consent of the senate to a two-year
18-9 term that expires on February 1 of the final year of the term.
18-10 Appointment of the counsellor shall be made without regard to the
18-11 race, color, disability, sex, religion, age, or national origin of
18-12 the appointee.
18-13 (c) The counsellor shall be a resident of Texas and admitted
18-14 to the practice of law in this state who has demonstrated a strong
18-15 commitment and involvement in efforts to safeguard the rights of
18-16 the public and possesses the knowledge and experience necessary to
18-17 practice effectively in utility proceedings.
18-18 (d) A person is not eligible for appointment as counsellor
18-19 if the person or the person's spouse:
18-20 (1) is employed by or participates in the management
18-21 of a business entity or other organization regulated by the
18-22 commission or receiving funds from the commission;
18-23 (2) owns or controls, directly or indirectly, more
18-24 than a 10 percent interest or a pecuniary interest with a value
18-25 exceeding $10,000 in:
18-26 (A) a business entity or other organization
18-27 regulated by the commission or receiving funds from the commission
19-1 or the office; or
19-2 (B) any utility competitor, utility supplier, or
19-3 other entity affected by a commission decision in a manner other
19-4 than by the setting of rates for that class of customer;
19-5 (3) uses or receives a substantial amount of tangible
19-6 goods, services, or funds from the commission or the office, other
19-7 than compensation or reimbursement authorized by law for counsellor
19-8 or commission membership, attendance, or expenses; or
19-9 (4) notwithstanding Subdivision (2) of this
19-10 subsection, has an interest in a mutual fund or retirement fund in
19-11 which more than 10 percent of the fund's holdings is in a single
19-12 utility, utility competitor, or utility supplier in this state and
19-13 the person does not disclose this information to the governor,
19-14 senate, or other entity, as appropriate.
19-15 (e) A person may not serve as counsellor or act as the
19-16 general counsel for the office if the person is required to
19-17 register as a lobbyist under Chapter 305, Government Code, because
19-18 of the person's activities for compensation related to the
19-19 operation of the commission or the office.
19-20 (f) An officer, employee, or paid consultant of a trade
19-21 association in the field of public utilities may not serve as
19-22 counsellor or be an employee of the office who is exempt from the
19-23 state's position classification plan or is compensated at or above
19-24 the amount prescribed by the General Appropriations Act for step 1,
19-25 salary group 17, of the position classification salary schedule. A
19-26 person who is the spouse of an officer, manager, or paid consultant
19-27 of a trade association in the field of public utilities may not
20-1 serve as counsellor and may not be an office employee who is exempt
20-2 from the state's position classification plan or is compensated at
20-3 or above the amount prescribed by the General Appropriations Act
20-4 for step 1, salary group 17, of the position classification salary
20-5 schedule.
20-6 (g) Notwithstanding any other provision of this Act, a
20-7 person otherwise ineligible because of the application of
20-8 Subsection (d)(2) of this section may be appointed as counsellor
20-9 and may serve as counsellor if the person:
20-10 (1) notifies the attorney general and commission that
20-11 the person is ineligible because of the application of Subsection
20-12 (d)(2) of this section; and
20-13 (2) divests the person or the person's spouse of the
20-14 ownership or control before appointment, or within a reasonable
20-15 time if the person is already serving at the time Subsection (d)(2)
20-16 of this section first applies to the person.
20-17 SECTION 1.16. Subtitle C, Title I, Public Utility Regulatory
20-18 Act of 1995, as enacted by S.B. No. 319, Acts of the 74th
20-19 Legislature, Regular Session, 1995, is amended by adding Section
20-20 1.0511 to read as follows:
20-21 Sec. 1.0511. GROUNDS FOR REMOVAL. (a) It is a ground for
20-22 removal from office if the counsellor:
20-23 (1) does not have at the time of appointment the
20-24 qualifications required by Section 1.051 of this Act;
20-25 (2) does not maintain during service as counsellor the
20-26 qualifications required by Section 1.051 of this Act;
20-27 (3) violates a prohibition established by Section
21-1 1.051 or 1.0512 of this Act; or
21-2 (4) cannot discharge the counsellor's duties for a
21-3 substantial part of the term for which the counsellor is appointed
21-4 because of illness or disability.
21-5 (b) The validity of an action of the office is not affected
21-6 by the fact that it is taken when a ground for removal of the
21-7 counsellor exists.
21-8 SECTION 1.17. Subtitle C, Title I, Public Utility Regulatory
21-9 Act of 1995, as enacted by S.B. No. 319, Acts of the 74th
21-10 Legislature, Regular Session, 1995, is amended by adding Section
21-11 1.0512 to read as follows:
21-12 Sec. 1.0512. PROHIBITION OF EMPLOYMENT OR REPRESENTATION.
21-13 (a) The counsellor may not within two years, and an employee of
21-14 the office may not, within one year after his employment with the
21-15 office has ceased, be employed by a public utility which was in the
21-16 scope of the counsellor's or employee's official responsibility
21-17 while the counsellor or employee was associated with the office.
21-18 (b) During the time the counsellor or an employee of the
21-19 office is associated with the office or at any time after, the
21-20 counsellor or employee may not represent a person, corporation, or
21-21 other business entity before the commission or a court in a matter
21-22 in which the counsellor or employee was personally involved while
21-23 associated with the office or a matter that was within the
21-24 counsellor's or employee's official responsibility while the
21-25 counsellor or employee was associated with the office.
21-26 SECTION 1.18. Subtitle C, Title I, Public Utility Regulatory
21-27 Act of 1995, as enacted by S.B. No. 319, Acts of the 74th
22-1 Legislature, Regular Session, 1995, is amended by adding Section
22-2 1.0513 to read as follows:
22-3 Sec. 1.0513. INFORMATION; ACCESSIBILITY. (a) The office
22-4 shall prepare annually a complete and detailed written report
22-5 accounting for all funds received and disbursed by the office
22-6 during the preceding fiscal year. The annual report must meet the
22-7 reporting requirements applicable to financial reporting provided
22-8 in the General Appropriations Act.
22-9 (b) The office shall prepare information of public interest
22-10 describing the functions of the office. The office shall make the
22-11 information available to the public and appropriate state agencies.
22-12 (c) The office shall comply with federal and state laws
22-13 related to program and facility accessibility. The office shall
22-14 also prepare and maintain a written plan that describes how a
22-15 person who does not speak English can be provided reasonable access
22-16 to the office's programs and services.
22-17 SECTION 1.19. Section 1.052, Public Utility Regulatory Act
22-18 of 1995, as enacted by S.B. No. 319, Acts of the 74th Legislature,
22-19 Regular Session, 1995, is amended to read as follows:
22-20 Sec. 1.052. INTEREST PROHIBITED. During the period of the
22-21 counsellor's employment and for a period of two years following the
22-22 termination of employment, it shall be unlawful for any person
22-23 employed as counsellor to have a direct or indirect interest in any
22-24 utility company regulated under this Act, to provide legal services
22-25 directly or indirectly to or be employed in any capacity by a
22-26 utility company regulated under this Act, its parent, or its
22-27 subsidiary companies, corporations, or cooperatives or a utility
23-1 competitor, utility supplier, or other entity affected in a manner
23-2 other than by the setting of rates for that class of customer; but
23-3 such person may otherwise engage in the private practice of law
23-4 after the termination of employment as counsellor.
23-5 SECTION 1.20. Section 1.053, Public Utility Regulatory Act
23-6 of 1995, as enacted by S.B. No. 319, Acts of the 74th Legislature,
23-7 Regular Session, 1995, is amended to read as follows:
23-8 Sec. 1.053. EMPLOYEES. (a) The counsellor may employ such
23-9 lawyers, economists, engineers, consultants, statisticians,
23-10 accountants, clerical staff, and other employees as he or she deems
23-11 necessary to carry out the provisions of this section. All
23-12 employees shall receive such compensation as is fixed by the
23-13 legislature from the assessment imposed by Section 1.351 of this
23-14 Act.
23-15 (b) The counsellor or the counsellor's designee shall
23-16 develop an intra-agency career ladder program that addresses
23-17 opportunities for mobility and advancement for employees within the
23-18 commission. The program shall require intra-agency postings of all
23-19 positions concurrently with any public posting. The counsellor or
23-20 the counsellor's designee shall develop a system of annual
23-21 performance evaluations that are based on documented employee
23-22 performance. All merit pay for office employees must be based on
23-23 the system established under this subsection. The counsellor or
23-24 the counsellor's designee shall provide to the public utility
23-25 counsel and its employees, as often as necessary, information
23-26 regarding their qualification for office or employment under this
23-27 Act and their responsibilities under applicable laws relating to
24-1 standards of conduct for state officers or employees.
24-2 (c) The counsellor or the counsellor's designee shall
24-3 prepare and maintain a written policy statement to assure
24-4 implementation of a program of equal employment opportunity under
24-5 which all personnel transactions are made without regard to race,
24-6 color, disability, sex, religion, age, or national origin. The
24-7 policy statement must include:
24-8 (1) personnel policies that comply with Chapter 21,
24-9 Labor Code, including policies relating to recruitment, evaluation,
24-10 selection, appointment, training, and promotion of personnel;
24-11 (2) a comprehensive analysis of the office workforce
24-12 that meets federal and state guidelines;
24-13 (3) procedures by which a determination can be made
24-14 about the extent of underuse in the office workforce of all persons
24-15 for whom federal or state guidelines encourage a more equitable
24-16 balance; and
24-17 (4) reasonable methods to appropriately address the
24-18 underuse.
24-19 (d) A policy statement prepared under Subsection (c) of this
24-20 section must cover an annual period, be updated at least annually
24-21 and reviewed by the Commission on Human Rights for compliance with
24-22 Subsection (c)(1) of this section, and be filed with the governor's
24-23 office. The governor's office shall deliver a biennial report to
24-24 the legislature based on the information received under this
24-25 subsection. The report may be made separately or as a part of
24-26 other biennial reports made to the legislature.
24-27 (e) The office shall provide to its employees, as often as
25-1 necessary, information regarding their qualification for office or
25-2 employment under this Act and their responsibilities under
25-3 applicable laws relating to standards of conduct for state officers
25-4 or employees.
25-5 SECTION 1.21. Section 1.101, Public Utility Regulatory Act
25-6 of 1995, as enacted by S.B. No. 319, Acts of the 74th Legislature,
25-7 Regular Session, 1995, is amended to read as follows:
25-8 Sec. 1.101. GENERAL POWER; RULES; HEARINGS; AUDITS.
25-9 (a) The commission has the general power to regulate and supervise
25-10 the business of every public utility within its jurisdiction and to
25-11 do all things, whether specifically designated in this Act or
25-12 implied herein, necessary and convenient to the exercise of this
25-13 power and jurisdiction.
25-14 (b) The commission shall make and enforce rules reasonably
25-15 required in the exercise of its powers and jurisdiction, including
25-16 rules governing practice and procedure before the commission and,
25-17 as applicable, practice and procedure before the utility division
25-18 of the State Office of Administrative Hearings. The commission
25-19 shall adopt rules authorizing an administrative law judge to:
25-20 (1) limit the amount of time that a party may have to
25-21 present its case;
25-22 (2) limit the number of requests for information that
25-23 a party may make in a contested case;
25-24 (3) require a party to a contested case to identify
25-25 contested issues and facts before the hearing begins and to limit
25-26 cross-examination to only those issues and facts and to any new
25-27 issues that may arise as a result of the discovery process; or
26-1 (4) group parties, other than the office, that have
26-2 the same position on an issue to facilitate cross-examination on
26-3 that issue, provided that each party in a group is entitled to
26-4 present that party's witnesses for cross-examination during the
26-5 hearing.
26-6 (c) Rules adopted under Subsection (b) of this section must
26-7 ensure that all parties receive due process.
26-8 (d) The commission may call and hold hearings, administer
26-9 oaths, receive evidence at hearings, issue subpoenas to compel the
26-10 attendance of witnesses and the production of papers and documents,
26-11 and make findings of fact and decisions with respect to
26-12 administering the provisions of this Act or the rules, orders, or
26-13 other actions of the commission.
26-14 (e) Hearings in contested cases not conducted by one or more
26-15 commissioners shall be conducted by the utility division of the
26-16 State Office of Administrative Hearings. The <(d) Notwithstanding
26-17 any other provision of this Act or other law, in proceedings other
26-18 than those involving major rate changes, the> commission may
26-19 delegate to the utility division of the State Office of
26-20 Administrative Hearings <an administrative law judge or hearings
26-21 examiner> the authority to make a final decision and to issue
26-22 findings of fact, conclusions of law, and other necessary orders in
26-23 a proceeding in which there is no contested issue of fact or law.
26-24 The commission by rule shall define the procedures by which it
26-25 delegates final decision-making authority authorized by this
26-26 section. For review purposes the final decision of the
26-27 administrative law judge <or hearings examiner> has the same effect
27-1 as a final decision of the commission unless a commissioner
27-2 requests formal review of the decision.
27-3 SECTION 1.22. Subsection (b), Section 1.102, Public Utility
27-4 Regulatory Act of 1995, as enacted by S.B. No. 319, Acts of the
27-5 74th Legislature, Regular Session, 1995, is amended to read as
27-6 follows:
27-7 (b) The commission may audit each utility under the
27-8 jurisdiction of the commission as frequently as needed<, but shall
27-9 audit each utility at least once every 10 years>. Six months after
27-10 any audit, the utility shall report to the commission on the status
27-11 of the implementation of the recommendations of the audit and shall
27-12 file subsequent reports at such times as the commission deems
27-13 appropriate.
27-14 SECTION 1.23. Subtitle D, Title I, Public Utility Regulatory
27-15 Act of 1995, as enacted by S.B. No. 319, Acts of the 74th
27-16 Legislature, Regular Session, 1995, is amended by adding Section
27-17 1.104 to read as follows:
27-18 Sec. 1.104. SETTLEMENTS. (a) The commission by rule shall
27-19 adopt procedures governing the use of settlements to resolve
27-20 contested cases.
27-21 (b) The rules shall ensure that:
27-22 (1) each party retains the right to:
27-23 (A) have a full hearing before the commission on
27-24 issues that remain in dispute; and
27-25 (B) judicial review of issues that remain in
27-26 dispute;
27-27 (2) an issue of fact raised by a nonsettling party
28-1 cannot be waived by a settlement or stipulation of the other
28-2 parties; and
28-3 (3) the nonsettling party may use the issue of fact
28-4 raised by that party as the basis for judicial review.
28-5 SECTION 1.24. Section 1.202, Public Utility Regulatory Act
28-6 of 1995, as enacted by S.B. No. 319, Acts of the 74th Legislature,
28-7 Regular Session, 1995, is amended to read as follows:
28-8 Sec. 1.202. POWERS OF COMMISSION. (a) The commission shall
28-9 have the power to:
28-10 (1) require that public utilities report to it such
28-11 information relating to transactions between themselves and
28-12 affiliated interests both within and without the State of Texas to
28-13 the extent that those transactions are subject to the jurisdiction
28-14 of the commission <as it may consider useful in the administration
28-15 of this Act>;
28-16 (2) establish forms for all reports;
28-17 (3) determine the time for reports and the frequency
28-18 with which any reports are to be made;
28-19 (4) require that any reports be made under oath;
28-20 (5) require that a copy of any contract or arrangement
28-21 between any public utility and any affiliated interest be filed
28-22 with it. It may require any such contract or arrangement not in
28-23 writing to be reduced to writing and filed with it;
28-24 (6) require that a copy of any report filed with any
28-25 federal agency or any governmental agency or body of any other
28-26 state be filed with it; and
28-27 (7) require that a copy of annual reports showing all
29-1 payments of compensation (other than salary or wages subject to the
29-2 withholding of federal income tax) to residents of Texas, or with
29-3 respect to legal, administrative, or legislative matters in Texas,
29-4 or for representation before the Texas Legislature or any
29-5 governmental agency or body be filed with it.
29-6 (b) <The railroad commission shall have the power to review
29-7 and approve, for purposes of the Outer Continental Shelf Lands Act
29-8 Amendments of 1978 and any other federal authorities, applications
29-9 by gas utilities for the purchase of natural gas from producing
29-10 affiliates.>
29-11 <(c)> On the request of the governing body of any
29-12 municipality, the commission may provide sufficient staff members
29-13 to advise and consult with such municipality on any pending matter.
29-14 SECTION 1.25. Subsection (b), Section 1.251, Public Utility
29-15 Regulatory Act of 1995, as enacted by S.B. No. 319, Acts of the
29-16 74th Legislature, Regular Session, 1995, is amended to read as
29-17 follows:
29-18 (b) All transactions involving the sale of 50 percent or
29-19 more of the stock of a public utility shall also be reported to the
29-20 commission within a reasonable time. On the filing of a report
29-21 with the commission, the commission shall investigate the same with
29-22 or without public hearing to determine whether the action is
29-23 consistent with the public interest. In reaching its
29-24 determination, the commission shall take into consideration the
29-25 reasonable value of the property, facilities, or securities to be
29-26 acquired, disposed of, merged, transferred, or consolidated and
29-27 whether such a transaction will adversely affect the health or
30-1 safety of customers or employees, result in the transfer of jobs of
30-2 Texas citizens to workers domiciled outside the State of Texas, or
30-3 result in the decline of service, that the public utility will
30-4 receive consideration equal to the reasonable value of the assets
30-5 when it sells, leases, or transfers assets, and that the
30-6 transaction is consistent with the public interest.
30-7 SECTION 1.26. Section 1.271, Public Utility Regulatory Act
30-8 of 1995, as enacted by S.B. No. 319, Acts of the 74th Legislature,
30-9 Regular Session, 1995, is amended to read as follows:
30-10 Sec. 1.271. JURISDICTION OVER AFFILIATED INTERESTS. The
30-11 commission shall have jurisdiction over <affiliated interests
30-12 having> transactions between <with> public utilities under the
30-13 jurisdiction of the commission and affiliated interests to the
30-14 extent of access to all accounts and records of such affiliated
30-15 interests relating to such transactions, including but in no way
30-16 limited to accounts and records of joint or general expenses, any
30-17 portion of which may be applicable to such transactions. Any
30-18 accounts or records obtained by the commission related to sales of
30-19 electrical energy at wholesale by an affiliated interest to the
30-20 public utility shall be confidential and not subject to disclosure
30-21 under Chapter 552, Government Code.
30-22 SECTION 1.27. Subtitle I, Title I, Public Utility Regulatory
30-23 Act of 1995, as enacted by S.B. No. 319, Acts of the 74th
30-24 Legislature, Regular Session, 1995, is amended by adding Section
30-25 1.3215 to read as follows:
30-26 Sec. 1.3215. ADMINISTRATIVE PENALTY. (a) The commission
30-27 may impose an administrative penalty against a person regulated
31-1 under this Act who violates this Act or a rule or order adopted
31-2 under this Act.
31-3 (b) The penalty for a violation may be in an amount not to
31-4 exceed $5,000. Each day a violation continues or occurs is a
31-5 separate violation for purposes of imposing a penalty.
31-6 (c) The amount of the penalty shall be based on:
31-7 (1) the seriousness of the violation, including the
31-8 nature, circumstances, extent, and gravity of any prohibited acts,
31-9 and the hazard or potential hazard created to the health, safety,
31-10 or economic welfare of the public;
31-11 (2) the economic harm to property or the environment
31-12 caused by the violation;
31-13 (3) the history of previous violations;
31-14 (4) the amount necessary to deter future violations;
31-15 (5) efforts to correct the violation; and
31-16 (6) any other matter that justice may require.
31-17 (d) If the executive director determines that a violation
31-18 has occurred, the executive director may issue to the commission a
31-19 report that states the facts on which the determination is based
31-20 and the director's recommendation on the imposition of a penalty,
31-21 including a recommendation on the amount of the penalty.
31-22 (e) Within 14 days after the date the report is issued, the
31-23 executive director shall give written notice of the report to the
31-24 person. The notice may be given by certified mail. The notice
31-25 must include a brief summary of the alleged violation and a
31-26 statement of the amount of the recommended penalty and must inform
31-27 the person that the person has a right to a hearing on the
32-1 occurrence of the violation, the amount of the penalty, or both the
32-2 occurrence of the violation and the amount of the penalty. Before
32-3 any penalty may be assessed under this section, the person against
32-4 whom the penalty may be assessed shall be given 30 days after
32-5 receiving from the executive director the notice of the report
32-6 summarizing the alleged violation pursuant to this subsection in
32-7 which to cure the violation and the person must fail to cure the
32-8 alleged violation within the 30-day period. The person against
32-9 whom the penalty may be assessed who claims to have cured the
32-10 alleged violation shall have the burden of proving to the
32-11 commission that the alleged violation was cured and was accidental
32-12 or inadvertent.
32-13 (f) Within 20 days after the date the person receives the
32-14 notice, the person in writing may accept the determination and
32-15 recommended penalty of the executive director or may make a written
32-16 request for a hearing on the occurrence of the violation, the
32-17 amount of the penalty, or both the occurrence of the violation and
32-18 the amount of the penalty.
32-19 (g) If the person accepts the determination and recommended
32-20 penalty of the executive director, the commission by order shall
32-21 approve the determination and impose the recommended penalty.
32-22 (h) If the person requests a hearing or fails to respond
32-23 timely to the notice, the executive director shall set a hearing
32-24 and give notice of the hearing to the person. The hearing shall be
32-25 held by an administrative law judge of the State Office of
32-26 Administrative Hearings. The administrative law judge shall make
32-27 findings of fact and conclusions of law and promptly issue to the
33-1 commission a proposal for a decision about the occurrence of the
33-2 violation and the amount of a proposed penalty. Based on the
33-3 findings of fact, conclusions of law, and proposal for a decision,
33-4 the commission by order may find that a violation has occurred and
33-5 impose a penalty or may find that no violation occurred.
33-6 (i) The notice of the commission's order given to the person
33-7 under Chapter 2001, Government Code, must include a statement of
33-8 the right of the person to judicial review of the order.
33-9 (j) Within 30 days after the date the commission's order is
33-10 final as provided by Section 2001.144, Government Code, the person
33-11 shall:
33-12 (1) pay the amount of the penalty;
33-13 (2) pay the amount of the penalty and file a petition
33-14 for judicial review contesting the occurrence of the violation, the
33-15 amount of the penalty, or both the occurrence of the violation and
33-16 the amount of the penalty; or
33-17 (3) without paying the amount of the penalty, file a
33-18 petition for judicial review contesting the occurrence of the
33-19 violation, the amount of the penalty, or both the occurrence of the
33-20 violation and the amount of the penalty.
33-21 (k) Within the 30-day period, a person who acts under
33-22 Subsection (j)(3) of this section may:
33-23 (1) stay enforcement of the penalty by:
33-24 (A) paying the amount of the penalty to the
33-25 court for placement in an escrow account; or
33-26 (B) giving to the court a supersedeas bond that
33-27 is approved by the court for the amount of the penalty and that is
34-1 effective until all judicial review of the commission's order is
34-2 final; or
34-3 (2) request the court to stay enforcement of the
34-4 penalty by:
34-5 (A) filing with the court a sworn affidavit of
34-6 the person stating that the person is financially unable to pay the
34-7 amount of the penalty and is financially unable to give the
34-8 supersedeas bond; and
34-9 (B) giving a copy of the affidavit to the
34-10 executive director by certified mail.
34-11 (l) The executive director, on receipt of a copy of an
34-12 affidavit under Subsection (k)(2) of this section, may file with
34-13 the court, within five days after the date the copy is received, a
34-14 contest to the affidavit. The court shall hold a hearing on the
34-15 facts alleged in the affidavit as soon as practicable and shall
34-16 stay the enforcement of the penalty on finding that the alleged
34-17 facts are true. The person who files an affidavit has the burden
34-18 of proving that the person is financially unable to pay the amount
34-19 of the penalty and to give a supersedeas bond.
34-20 (m) If the person does not pay the amount of the penalty and
34-21 the enforcement of the penalty is not stayed, the executive
34-22 director may refer the matter to the attorney general for
34-23 collection of the amount of the penalty.
34-24 (n) Judicial review of the order of the commission:
34-25 (1) is instituted by filing a petition as provided by
34-26 Subchapter G, Chapter 2001, Government Code; and
34-27 (2) is under the substantial evidence rule.
35-1 (o) If the court sustains the occurrence of the violation,
35-2 the court may uphold or reduce the amount of the penalty and order
35-3 the person to pay the full or reduced amount of the penalty. If
35-4 the court does not sustain the occurrence of the violation, the
35-5 court shall order that no penalty is owed.
35-6 (p) When the judgment of the court becomes final, the court
35-7 shall proceed under this subsection. If the person paid the amount
35-8 of the penalty and if that amount is reduced or is not upheld by
35-9 the court, the court shall order that the appropriate amount plus
35-10 accrued interest be remitted to the person. The rate of the
35-11 interest is the rate charged on loans to depository institutions by
35-12 the New York Federal Reserve Bank, and the interest shall be paid
35-13 for the period beginning on the date the penalty was paid and
35-14 ending on the date the penalty is remitted. If the person gave a
35-15 supersedeas bond and if the amount of the penalty is not upheld by
35-16 the court, the court shall order the release of the bond. If the
35-17 person gave a supersedeas bond and if the amount of the penalty is
35-18 reduced, the court shall order the release of the bond after the
35-19 person pays the amount.
35-20 (q) A penalty collected under this section shall be remitted
35-21 to the comptroller for deposit in the general revenue fund.
35-22 (r) All proceedings under this section are subject to
35-23 Chapter 2001, Government Code.
35-24 (s) The executive director may delegate to a person that the
35-25 executive director designates any power or duty given the executive
35-26 director by this section.
35-27 SECTION 1.28. Subsection (b), Section 1.351, Public Utility
36-1 Regulatory Act of 1995, as enacted by S.B. No. 319, Acts of the
36-2 74th Legislature, Regular Session, 1995, is amended to read as
36-3 follows:
36-4 (b) The legislature may <commission shall, subject to the
36-5 approval of the legislature,> adjust this assessment to provide a
36-6 level of income sufficient to fund the commission and the office of
36-7 public utility counsel.
36-8 SECTION 1.29. Section 1.354, Public Utility Regulatory Act
36-9 of 1995, as enacted by S.B. No. 319, Acts of the 74th Legislature,
36-10 Regular Session, 1995, is amended to read as follows:
36-11 Sec. 1.354. COLLECTION AND PAYMENT INTO GENERAL REVENUE
36-12 FUND. (a) All fees, penalties, and interest paid under the
36-13 provisions of Sections 1.351, <and> 1.352, and 1.353 of this Act
36-14 shall be collected by the comptroller of public accounts and paid
36-15 into the general revenue fund. <The commission shall notify the
36-16 comptroller of public accounts of any adjustment of the assessment
36-17 imposed in Section 1.351 when made.>
36-18 (b) All money paid to the commission or to the office under
36-19 this Act is subject to Subchapter F, Chapter 404, Government Code.
36-20 SECTION 1.30. Section 1.355, Public Utility Regulatory Act
36-21 of 1995, as enacted by S.B. No. 319, Acts of the 74th Legislature,
36-22 Regular Session, 1995, is amended to read as follows:
36-23 Sec. 1.355. GRANTS OF FEDERAL FUNDS. (a) The commission
36-24 may apply to any appropriate agency or officer of the United States
36-25 to receive and spend federal funds which it may obtain from grants
36-26 or other similar forms of financial assistance. Nothing in this
36-27 section shall inhibit the commission's ability to contract with or
37-1 otherwise receive assistance from any state, local, or other
37-2 authorized source of funds.
37-3 (b) Sections 403.094 and 403.095, Government Code, do not
37-4 apply to the special account established under this section.
37-5 <APPROVAL OF BUDGET. The budget of the commission shall be subject
37-6 to legislative approval as part of the appropriations act.>
37-7 SECTION 1.31. Subtitle J, Title I, Public Utility Regulatory
37-8 Act of 1995, as enacted by S.B. No. 319, Acts of the 74th
37-9 Legislature, Regular Session, 1995, is amended by adding Section
37-10 1.357 to read as follows:
37-11 Sec. 1.357. APPROVAL OF BUDGET. The budget of the
37-12 commission shall be subject to legislative approval as part of the
37-13 General Appropriations Act.
37-14 SECTION 1.32. Subsections (a) and (b), Section 1.401, Public
37-15 Utility Regulatory Act of 1995, as enacted by S.B. No. 319, Acts of
37-16 the 74th Legislature, Regular Session, 1995, are amended to read as
37-17 follows:
37-18 (a) Any affected person may complain to the regulatory
37-19 authority in writing setting forth any act or thing done or omitted
37-20 to be done by any public utility in violation or claimed violation
37-21 of any law which the regulatory authority has jurisdiction to
37-22 administer or of any order, ordinance, rule, or regulation of the
37-23 regulatory authority. The commission shall keep <an> information
37-24 <file> about each complaint filed with the commission <relating to
37-25 a utility>. The commission shall retain the information <file> for
37-26 a reasonable period. The information shall include:
37-27 (1) the date the complaint is received;
38-1 (2) the name of the complainant;
38-2 (3) the subject matter of the complaint;
38-3 (4) a record of all persons contacted in relation to
38-4 the complaint;
38-5 (5) a summary of the results of the review or
38-6 investigation of the complaint; and
38-7 (6) for complaints for which the commission took no
38-8 action, an explanation of the reason the complaint was closed
38-9 without action.
38-10 (b) The commission shall keep a file about each <If a>
38-11 written complaint <is> filed with the commission. The commission
38-12 shall provide to the person filing the complaint and to the persons
38-13 or entities complained about the commission's policies and
38-14 procedures pertaining to complaint investigation and resolution.
38-15 The <relating to a utility, the> commission, at least <as
38-16 frequently as> quarterly and until final disposition of the
38-17 complaint, shall notify the person filing <parties to> the
38-18 complaint and each person or entity complained about of the status
38-19 of the complaint unless the notice would jeopardize an undercover
38-20 investigation.
38-21 SECTION 1.33. Subtitle K, Title I, Public Utility Regulatory
38-22 Act of 1995, as enacted by S.B. No. 319, Acts of the 74th
38-23 Legislature, Regular Session, 1995, is amended by adding Section
38-24 1.408 to read as follows:
38-25 Sec. 1.408. RIGHT TO CONTRIBUTION. In any action or claim
38-26 brought against a public utility for personal injury or property
38-27 damage arising out of or in connection with the utility's
39-1 transmission or distribution system, the utility shall have, in
39-2 addition to any other rights of contribution or indemnity provided
39-3 by law, a right of contribution against any person, other than
39-4 another electric utility having retail customers, using or which
39-5 has used the utility's transmission or distribution system to
39-6 transmit or sell electricity during the period relevant to the
39-7 claim or action which is the basis of the claim or action against
39-8 the utility. This right of contribution shall not extend to an
39-9 action or claim based solely on the utility's failure to comply
39-10 with the National Electrical Safety Code or to properly maintain
39-11 its facilities.
39-12 SECTION 1.34. Subchapter C, Chapter 2003, Government Code,
39-13 is amended by adding Section 2003.047 to read as follows:
39-14 Sec. 2003.047. UTILITY DIVISION. (a) The office shall
39-15 establish a utility division to perform the contested case hearings
39-16 for the Public Utility Commission of Texas as prescribed by the
39-17 Public Utility Regulatory Act of 1995 and other applicable law.
39-18 (b) The utility division shall conduct hearings relating to
39-19 contested cases before the commission, other than a hearing
39-20 conducted by one or more commissioners. The commission by rule may
39-21 delegate the responsibility to hear any other matter before the
39-22 commission if consistent with the duties and responsibilities of
39-23 the division.
39-24 (c) Only an administrative law judge in the utility division
39-25 may conduct a hearing on behalf of the commission. An
39-26 administrative law judge in the utility division may conduct
39-27 hearings for other state agencies as time allows. The office may
40-1 transfer an administrative law judge into the division on a
40-2 temporary or permanent basis and may contract with qualified
40-3 individuals to serve as temporary administrative law judges as
40-4 necessary.
40-5 (d) To be eligible to preside at a hearing, an
40-6 administrative law judge, regardless of temporary or permanent
40-7 status, must be licensed to practice law in this state and have not
40-8 less than five years of general experience or three years of
40-9 experience in utility regulatory law.
40-10 (e) At the time the office receives jurisdiction of a
40-11 proceeding, the commission shall provide to the administrative law
40-12 judge a list of issues or areas that must be addressed. In
40-13 addition, the commission may identify and provide to the
40-14 administrative law judge at any time additional issues or areas
40-15 that must be addressed.
40-16 (f) The office and the commission shall jointly adopt rules
40-17 providing for certification to the commission of an issue that
40-18 involves an ultimate finding of compliance with or satisfaction of
40-19 a statutory standard the determination of which is committed to the
40-20 discretion or judgment of the commission by law. The rules must
40-21 address, at a minimum, the issues that are appropriate for
40-22 certification and the procedure to be used in certifying the issue.
40-23 Each agency shall publish the jointly adopted rules.
40-24 (g) Notwithstanding Section 2001.058, the commission may
40-25 change a finding of fact or conclusion of law made by the
40-26 administrative law judge or vacate or modify an order issued by the
40-27 administrative law judge only if the commission:
41-1 (1) determines that the administrative law judge:
41-2 (A) did not properly apply or interpret
41-3 applicable law, commission rules or policies, or prior
41-4 administrative decisions; or
41-5 (B) issued a finding of fact that is not
41-6 supported by a preponderance of the evidence; or
41-7 (2) determines that a commission policy or a prior
41-8 administrative decision on which the administrative law judge
41-9 relied is incorrect or should be changed.
41-10 (h) The commission shall state in writing the specific
41-11 reason and legal basis for its determination under Subsection (g).
41-12 (i) An administrative law judge, on the judge's own motion
41-13 or on motion of a party and after notice and an opportunity for a
41-14 hearing, may impose appropriate sanctions as provided by Subsection
41-15 (j) against a party or its representative for:
41-16 (1) filing a motion or pleading that is groundless and
41-17 brought:
41-18 (A) in bad faith;
41-19 (B) for the purpose of harassment; or
41-20 (C) for any other improper purpose, such as to
41-21 cause unnecessary delay or needless increase in the cost of the
41-22 proceeding;
41-23 (2) abuse of the discovery process in seeking, making,
41-24 or resisting discovery; or
41-25 (3) failure to obey an order of the administrative law
41-26 judge or the commission.
41-27 (j) A sanction imposed under Subsection (i) may include, as
42-1 appropriate and justified, issuance of an order:
42-2 (1) disallowing further discovery of any kind or of a
42-3 particular kind by the offending party;
42-4 (2) charging all or any part of the expenses of
42-5 discovery against the offending party or its representative;
42-6 (3) holding that designated facts be deemed admitted
42-7 for purposes of the proceeding;
42-8 (4) refusing to allow the offending party to support
42-9 or oppose a designated claim or defense or prohibiting the party
42-10 from introducing designated matters in evidence;
42-11 (5) disallowing in whole or in part requests for
42-12 relief by the offending party and excluding evidence in support of
42-13 such requests;
42-14 (6) punishing the offending party or its
42-15 representative for contempt to the same extent as a district court;
42-16 (7) requiring the offending party or its
42-17 representative to pay, at the time ordered by the administrative
42-18 law judge, the reasonable expenses, including attorney's fees,
42-19 incurred by other parties because of the sanctionable behavior; and
42-20 (8) striking pleadings or testimony, or both, in whole
42-21 or in part, or staying further proceedings until the order is
42-22 obeyed.
42-23 (k) Hearings conducted for the commission by the office
42-24 shall be held in hearing rooms provided by the commission. The
42-25 commission shall also provide the utility division access to its
42-26 computer systems, databases, and library resources.
42-27 (l) The office shall charge the commission a fixed annual
43-1 fee rather than an hourly rate for services rendered by the utility
43-2 division to the commission. The office and the commission shall
43-3 negotiate the amount of the fixed fee biennially, subject to the
43-4 approval of the governor, to coincide with the commission's
43-5 legislative appropriations request.
43-6 SECTION 1.35. (a) A task force is established to administer
43-7 the transfer of the hearings division from the Public Utility
43-8 Commission of Texas to the State Office of Administrative Hearings.
43-9 The task force is composed of:
43-10 (1) the governor or the governor's designee;
43-11 (2) the Legislative Budget Board or the board's
43-12 designee;
43-13 (3) the chairman of the Public Utility Commission of
43-14 Texas;
43-15 (4) the public utility counsel; and
43-16 (5) the chief administrative law judge of the State
43-17 Office of Administrative Hearings.
43-18 (b) The governor or the governor's designee is the presiding
43-19 officer of the task force.
43-20 (c) The task force shall:
43-21 (1) determine the personnel, equipment, data,
43-22 facilities, and other items that will be transferred under this Act
43-23 and the schedule for the transfers; and
43-24 (2) mediate and resolve disputes between the
43-25 respective agencies relating to a transfer.
43-26 (d) After the transfers have been completed, the task force
43-27 shall prepare a written report detailing the specifics of the
44-1 transfers and shall submit the report to the governor and the
44-2 legislature.
44-3 (e) In determining a transfer under this Act, the task force
44-4 shall ensure that the transfer does not adversely affect a
44-5 proceeding before the Public Utility Commission of Texas or the
44-6 rights of the parties to the proceeding.
44-7 (f) This section takes effect immediately.
44-8 SECTION 1.36. (a) On September 1, 1995, all personnel,
44-9 including hearings examiners and administrative law judges,
44-10 equipment, data, facilities, and other items of the hearings
44-11 division of the Public Utility Commission of Texas, other than the
44-12 personnel, equipment, data, facilities, and other items of the
44-13 central records office, are transferred to the utility division of
44-14 the State Office of Administrative Hearings. Until September 1,
44-15 1996, an employee transferred to the utility division may be
44-16 terminated or subject to salary reduction only for cause and only
44-17 in relation to poor performance or unacceptable conduct. A
44-18 hearings examiner transferred to the State Office of Administrative
44-19 Hearings becomes an administrative law judge on the date of
44-20 transfer.
44-21 (b) A hearings examiner or administrative law judge
44-22 transferred from the Public Utility Commission of Texas to the
44-23 State Office of Administrative Hearings shall continue to hear any
44-24 case assigned to the person as if the transfer had not occurred.
44-25 (c) The changes in law made by this Act that relate to the
44-26 procedures governing a hearing before the utility division of the
44-27 State Office of Administrative Hearings apply only to a case that
45-1 is filed on or after September 1, 1995. In addition, the
45-2 procedures prescribed by the provisions amended by this Act shall
45-3 continue to be used in a hearing as those provisions existed on
45-4 August 31, 1995. The former law is continued in effect for those
45-5 purposes.
45-6 (d) The Public Utility Commission of Texas is not required
45-7 by this Act or amendments made by this Act to adopt new rules
45-8 governing practice and procedure before the Public Utility
45-9 Commission of Texas or the utility division of the State Office of
45-10 Administrative Hearings. The rules in effect on the effective date
45-11 of this Act remain in effect until amended or repealed as required
45-12 by law. Any rules adopted after the effective date of this Act
45-13 governing practice and procedure before the utility division of the
45-14 State Office of Administrative Hearings must be adopted jointly by
45-15 that office and the commission.
45-16 SECTION 1.37. Section 1.3215, Public Utility Regulatory Act
45-17 of 1995, as added by this Act, applies only to a violation
45-18 committed on or after the effective date of this Act. A violation
45-19 committed before the effective date of this Act is governed by the
45-20 law in effect when the violation occurred, and that law is
45-21 continued in effect for that purpose.
45-22 SECTION 1.38. Section 1.104, Public Utility Regulatory Act
45-23 of 1995, as added by this Act, applies only to a proceeding for
45-24 which a final order has not been issued before the effective date
45-25 of this Act and does not apply to an electric utility merger
45-26 proceeding filed before January 1, 1995, in which a final order has
45-27 not been issued. Except as otherwise provided by this section, on
46-1 or after the effective date of this Act, the Public Utility
46-2 Commission of Texas may not approve a settlement unless the
46-3 settlement has been reached in accordance with rules adopted under
46-4 Section 1.104, Public Utility Regulatory Act of 1995, as added by
46-5 this Act.
46-6 SECTION 1.39. The changes in law made by this Act relating
46-7 to the requirements for membership on the Public Utility Commission
46-8 of Texas, to the requirements for service as public utility
46-9 counsel, or to employment as executive director or general counsel
46-10 of the commission apply only to a person appointed or hired, as
46-11 appropriate, on or after the effective date of this Act and do not
46-12 affect the entitlement of a member serving on the commission on
46-13 August 31, 1995, to continue to hold office for the remainder of
46-14 the term for which the person was appointed or the ability of a
46-15 person serving as public utility counsel, executive director, or
46-16 general counsel on August 31, 1995, to continue to hold that
46-17 position.
46-18 ARTICLE 2
46-19 SECTION 2.01. Subtitle A, Title II, Public Utility
46-20 Regulatory Act of 1995, as enacted by S.B. No. 319, Acts of the
46-21 74th Legislature, Regular Session, 1995, is amended by amending
46-22 Section 2.001 and adding Sections 2.0011 and 2.0012 to read as
46-23 follows:
46-24 Sec. 2.001. LEGISLATIVE POLICY CONCERNING REGULATION OF THE
46-25 ELECTRIC UTILITY INDUSTRY. (a) This title is enacted to protect
46-26 the public interest inherent in the rates and services of public
46-27 utilities. The legislature finds that public utilities are by
47-1 definition monopolies in many of the services they provide and in
47-2 many of the areas they serve, and that therefore the normal forces
47-3 of competition that operate to regulate prices in a free enterprise
47-4 society do not always operate, and that therefore, except as
47-5 otherwise provided for in this Act, utility rates, operations, and
47-6 services are regulated by public agencies. The purpose of this
47-7 title is to establish a comprehensive regulatory system that is
47-8 adequate to the task of regulating public utilities as defined in
47-9 this title, to assure rates, operations, and services that are just
47-10 and reasonable to consumers and to the utilities. Retail electric
47-11 service maintains the attributes that make regulation of monopolies
47-12 appropriate. The legislature finds that the wholesale electric
47-13 industry through federal legislative, judicial, and administrative
47-14 actions is becoming a more competitive industry which does not lend
47-15 itself to traditional electric utility regulatory rules, policies,
47-16 and principles and that, therefore, the public interest requires
47-17 that new rules, policies, and principles be formulated and applied
47-18 to protect the public interest in a more competitive marketplace.
47-19 The development of a competitive wholesale electric market that
47-20 allows for increased participation by both utilities and certain
47-21 nonutilities is in the public interest.
47-22 (b) Following adoption by the commission of rules
47-23 implementing the consumer and competitive safeguards included in
47-24 Subdivisions (1) through (4) of this subsection and only when the
47-25 utility has excess generation capacity, an electric utility may
47-26 charge individual customers for wholesale electric service at a
47-27 price that is lower than the wholesale rate approved by a
48-1 regulatory authority, but equal to or greater than the greater of
48-2 fifty percent of the demand-related cost included in such rate or
48-3 the utility's marginal costs. Nothing in this subsection, however,
48-4 shall affect the ability of electric utilities to enter into
48-5 emergency energy transactions. Within 180 days from the effective
48-6 date of this section, the commission shall make and enforce rules
48-7 sufficient to ensure that a utility's allocable costs of serving
48-8 customers paying discounted wholesale prices are not borne by the
48-9 utility's other customers. Such rules shall provide for the
48-10 following:
48-11 (1) that all revenues associated with discounted
48-12 wholesale sales shall be separately accounted for and credited to
48-13 the utility's other customers;
48-14 (2) rules of conduct pertaining to information
48-15 transfers, separation of personnel, operating procedures, and other
48-16 matters the commission finds necessary to ensure that third parties
48-17 receiving services from the utility are not disadvantaged relative
48-18 to the utility when it makes discounted wholesale sales;
48-19 (3) accounting standards including maintenance of
48-20 separate books, if necessary, reporting requirements, and other
48-21 provisions necessary to enforce the commission's responsibilities
48-22 under this subsection; and
48-23 (4) that discounted wholesale sales may only be made
48-24 when the firm capacity available to the utility is in excess of its
48-25 applicable reserve requirements for the duration of the sale.
48-26 Sec. 2.0011. DEFINITIONS. In this title:
48-27 (1) "Public<, "public> utility" or "utility" means any
49-1 person, corporation, river authority, cooperative corporation, or
49-2 any combination thereof, other than a municipal corporation, or
49-3 their lessees, trustees, and receivers, now or hereafter owning or
49-4 operating for compensation in this state equipment or facilities
49-5 for producing, generating, transmitting, distributing, selling, or
49-6 furnishing electricity in this state (hereinafter "electric
49-7 utility"); provided, however, that this definition may not be
49-8 construed to apply to or include a qualifying facility <small power
49-9 producer or qualifying cogenerator, as defined in Sections 3(17)(D)
49-10 and 3(18)(C) of the Federal Power Act, as amended (16 U.S.C.
49-11 Sections 796(17)(D) and 796(18)(C))>. The term does not include an
49-12 exempt wholesale generator, a power marketer, or a corporation as
49-13 prescribed by Section 2.0012 of this Act, or any person or
49-14 corporation not otherwise a public utility that:
49-15 (A) <(1)> furnishes the services or commodity
49-16 described in this section only to itself, its employees, or its
49-17 tenants as an incident of such employee service or tenancy, when
49-18 such service or commodity is not resold to or used by others;
49-19 (B) <(2)> owns or operates in this state
49-20 equipment or facilities for producing, generating, transmitting,
49-21 distributing, selling, or furnishing electric energy to an electric
49-22 utility, if the equipment or facilities are used primarily for the
49-23 production and generation of electric energy for consumption by the
49-24 person or corporation; or
49-25 (C) <(3)> owns or operates in this state a
49-26 recreational vehicle park that provides metered electric service in
49-27 accordance with Article 1446d-2, Revised Statutes, provided that a
50-1 recreational vehicle park owner is considered a public utility if
50-2 the owner fails to comply with Article 1446d-2, Revised Statutes,
50-3 with regard to the metered sale of electricity at the recreational
50-4 vehicle park.
50-5 (2) "Exempt wholesale generator" means a person that
50-6 is engaged directly, or indirectly through one or more affiliates,
50-7 exclusively in the business of owning, operating, or both owning
50-8 and operating all or part of one or more facilities for the
50-9 generation of electric energy and selling electric energy at
50-10 wholesale and that:
50-11 (A) does not own facilities for the transmission
50-12 of electricity, other than essential interconnecting transmission
50-13 facilities necessary to effect a sale of electric energy at
50-14 wholesale; and
50-15 (B) has applied to the Federal Energy Regulatory
50-16 Commission for a determination under Section 32, Public Utility
50-17 Holding Company Act (15 U.S.C. Section 79z-5a), or has registered
50-18 as an exempt wholesale generator as required by this Act.
50-19 (3) "Power marketer" means a person that:
50-20 (A) becomes owner of electric energy in this
50-21 state for the purpose of buying and selling the electric energy at
50-22 wholesale;
50-23 (B) does not own generation, transmission, or
50-24 distribution facilities in this state;
50-25 (C) does not have a certificated service area;
50-26 and
50-27 (D) has been granted authority by the Federal
51-1 Energy Regulatory Commission to sell electric energy at
51-2 market-based rates or has registered as a power marketer under this
51-3 Act.
51-4 (4) "Price" means any charge to a customer for retail
51-5 or wholesale electric service that is at or lower than a rate
51-6 approved by a regulatory authority.
51-7 (5) "Qualifying cogenerator" and "qualifying small
51-8 power producer" have the meanings assigned by Sections 3(18)(C) and
51-9 3(17)(D), Federal Power Act (16 U.S.C. Sections 796(18)(C) and
51-10 796(17)(D)).
51-11 (6) "Qualifying facility" means a qualifying
51-12 cogenerator or qualifying small power producer.
51-13 (7) "Rate" means and includes every compensation,
51-14 tariff, charge, fare, toll, rental, and classification, or any of
51-15 them demanded, observed, charged, or collected whether directly or
51-16 indirectly by any public utility for any service, product, or
51-17 commodity described in the definition of "utility" in Section 2.001
51-18 or 3.001 of this Act and any rules, regulations, practices, or
51-19 contracts affecting any such compensation, tariff, charge, fare,
51-20 toll, rental, or classification that must be approved by a
51-21 regulatory authority. Prices as defined in Subdivision (4) of this
51-22 section shall not be considered a rate.
51-23 (8) "Transmission service" includes construction or
51-24 enlargement of facilities, transmission over distribution
51-25 facilities, control area services, scheduling resources, regulation
51-26 service, providing operating reserves, reactive power support,
51-27 voltage control, and any other associated electrical services
52-1 deemed appropriate by the commission.
52-2 Sec. 2.0012. CERTAIN RIVER AUTHORITIES. (a)
52-3 Notwithstanding any other provision of this Act to the contrary,
52-4 the commission shall not have the authority to regulate directly or
52-5 indirectly the revenue requirements, rates, fuel costs, fuel
52-6 charges, or fuel acquisitions that are related to the generation
52-7 and sale of electricity at wholesale and not to ultimate consumers
52-8 by a river authority operating one or more steam generating plants.
52-9 Subject to the provisions of this section, the term "public
52-10 utility," "retail public utility," or "utility" shall not include a
52-11 corporation authorized by Chapter 245, Acts of the 67th
52-12 Legislature, Regular Session, 1981 (Article 717p, Vernon's Texas
52-13 Civil Statutes), and acting on behalf of the river authority to the
52-14 extent that the corporation sells electricity exclusively at
52-15 wholesale and not to ultimate consumers.
52-16 (b) This section shall constitute full authority for any
52-17 river authority operating one or more steam generating plants to
52-18 acquire, finance, construct, rebuild, repower, and use new and
52-19 existing power plants, equipment, transmission lines, and other
52-20 assets, for the sale of electricity exclusively at wholesale and
52-21 not at retail to any purchaser within San Saba, Llano, Burnet,
52-22 Travis, Bastrop, Blanco, Colorado, and Fayette counties and any
52-23 purchaser within the area served by the river authority on
52-24 January 1, 1975.
52-25 (c) This section shall constitute full authority for a
52-26 corporation described in Subsection (a) of this section to acquire,
52-27 finance, construct, rebuild, repower, operate, or sell facilities
53-1 directly related to the generation of electricity and sell the
53-2 output of such facilities, to the extent that such corporation
53-3 sells such electricity to any purchaser at any location in this
53-4 state exclusively at wholesale, and not to ultimate consumers,
53-5 notwithstanding any provisions to the contrary in the river
53-6 authority's enabling legislation or Chapter 245, Acts of the 67th
53-7 Legislature, Regular Session, 1981 (Article 717p, Vernon's Texas
53-8 Civil Statutes), provided that nothing in this section shall
53-9 preclude the corporation from purchasing transmission and related
53-10 services from such river authority. Except as provided in this
53-11 section, the development, financing, ownership, and operation of
53-12 such facilities by such corporation shall be subject to the
53-13 provisions of all applicable laws other than this Act, and the
53-14 property, gross receipts, and income of such corporation acting on
53-15 behalf of a river authority pursuant to this section shall be
53-16 subject to, and such corporation shall pay, taxes and assessments
53-17 of the federal government or of this state or of any municipal
53-18 corporation, county, or other political subdivision or taxing
53-19 district of this state on the same basis as an exempt wholesale
53-20 generator. No proceeds from the sale of bonds or other
53-21 obligations, the interest on which is exempt from taxation, issued
53-22 by the corporation or river authority, other than as may be
53-23 available to investor-owned utilities or exempt wholesale
53-24 generators, shall be used, or shall have been used, to finance the
53-25 construction or acquisition of or rebuilding or repowering of any
53-26 facilities for the generation of electricity by the corporation.
53-27 (d) This section shall not authorize the river authority to
54-1 acquire, install, construct, make additions to, or operate steam
54-2 generating plants whose aggregate capacity is greater than 5,000
54-3 megawatts to serve purchasers within the area served by the river
54-4 authority on January 1, 1975. In addition, any river authority
54-5 subject to this section and any corporation acting on behalf of
54-6 such river authority may provide retail service only to those
54-7 retail customers served by the river authority or corporation
54-8 acting on behalf of the river authority on September 1, 1995.
54-9 (e) Nothing in this section shall otherwise limit the powers
54-10 granted a river authority in its enabling legislation and other
54-11 applicable law.
54-12 SECTION 2.02. Subtitle A, Title II, Public Utility
54-13 Regulatory Act of 1995, as enacted by S.B. No. 319, Acts of the
54-14 74th Legislature, Regular Session, 1995, is amended by adding
54-15 Section 2.003 to read as follows:
54-16 Sec. 2.003. SCOPE OF COMPETITION. Before January 15 of each
54-17 odd-numbered year, the commission shall report to the legislature
54-18 on the scope of competition in electric markets and the impact of
54-19 competition and industry restructuring on customers in both
54-20 competitive and noncompetitive markets. The report shall include
54-21 an assessment of the impact of competition on the rates and
54-22 availability of electric services for residential and small
54-23 commercial customers and a summary of commission actions over the
54-24 preceding two years that reflect changes in the scope of
54-25 competition in regulated electric markets. The report shall also
54-26 include recommendations to the legislature for further legislation
54-27 that the commission finds appropriate to promote the public
55-1 interest in the context of a partially competitive electric market.
55-2 SECTION 2.03. Section 2.051, Public Utility Regulatory Act
55-3 of 1995, as enacted by S.B. No. 319, Acts of the 74th Legislature,
55-4 Regular Session, 1995, is amended to read as follows:
55-5 Sec. 2.051. INTEGRATED RESOURCE PLANNING. (a) The
55-6 commission by rule shall develop an integrated resource planning
55-7 process to provide reliable energy service at the lowest reasonable
55-8 cost. In determining the lowest reasonable cost of an electric
55-9 utility's plan, the commission shall consider in addition to direct
55-10 costs the following:
55-11 (1) the effect on the rates and bills of various types
55-12 of customers;
55-13 (2) minimization of the risks of future fuel costs and
55-14 regulations;
55-15 (3) the appropriateness and reliability of the mix of
55-16 resources; and
55-17 (4) the costs of compliance with the environmental
55-18 protection requirements of all applicable state and federal laws,
55-19 rules, and orders.
55-20 (b) The commission by rule shall adopt and periodically
55-21 update a statewide integrated resource plan that includes the
55-22 commission's long-term resource planning goals. The commission
55-23 shall send a report on the plan to the governor when it adopts or
55-24 revises the plan and notify each public utility of the approval of
55-25 the statewide plan. The commission shall make the report available
55-26 to the public.
55-27 (c) The report on the statewide plan shall include:
56-1 (1) historical data for electric consumption statewide
56-2 and by utility;
56-3 (2) historical data for electric generation by utility
56-4 and by type of capacity, including alternative energy sources;
56-5 (3) an inventory of generation capacity statewide and
56-6 by utility;
56-7 (4) quantitative data on demand-side management
56-8 programs to the extent the commission determines necessary;
56-9 (5) each generating utility's forecast without
56-10 adjustment;
56-11 (6) the commission's long-term resource planning goals
56-12 included in the plan;
56-13 (7) a projection of the need for electric services;
56-14 (8) a description of the approved individual
56-15 integrated resource plans of public utilities; and
56-16 (9) an assessment of transmission planning being
56-17 performed by utilities within this state.
56-18 (d) In prescribing the requirements under this section,
56-19 including reporting requirements, the commission shall consider and
56-20 recognize the differences in capabilities of small and large
56-21 utilities.
56-22 (e) Generating public utilities as well as non-generating
56-23 public utilities planning to construct generating resources shall
56-24 submit to the commission a preliminary integrated resource plan.
56-25 Preliminary integrated resource plans shall be submitted every
56-26 three years and cover a 10-year period. The commission by rule:
56-27 (1) shall:
57-1 (A) prescribe a staggered schedule for the
57-2 submission of plans by utilities;
57-3 (B) prescribe the form and manner in which a
57-4 plan must be submitted;
57-5 (C) adopt filing requirements and schedules; and
57-6 (D) prescribe the methods by which a utility may
57-7 recover supply-side and demand-side costs; and
57-8 (2) may:
57-9 (A) define the scope and nature of public
57-10 participation in the development of the plan; and
57-11 (B) establish the general guidelines to be used
57-12 by utilities in evaluating and selecting or rejecting resources,
57-13 including procedures governing the solicitation process.
57-14 (f) A preliminary plan submitted under this section must
57-15 include:
57-16 (1) the utility's forecast of future demands;
57-17 (2) an estimate of the energy savings and demand
57-18 reduction the utility can achieve during the 10-year period by use
57-19 of demand-side management resources and the range of possible costs
57-20 for those resources;
57-21 (3) if additional supply-side resources are needed to
57-22 meet future demand, an estimate of:
57-23 (A) the amount and operational characteristics
57-24 of the additional capacity needed;
57-25 (B) the types of viable supply-side resources
57-26 for meeting that need; and
57-27 (C) the range of probable costs of those
58-1 resources;
58-2 (4) if necessary, proposed requests for proposals for
58-3 demand-side or supply-side resources, or both;
58-4 (5) the specific criteria the utility will use to
58-5 evaluate and select or reject those resources, which criteria may
58-6 deviate from the general guidelines on a showing of good cause;
58-7 (6) the methods by which the utility intends to
58-8 monitor those resources after selection;
58-9 (7) the method by which the utility intends to
58-10 allocate costs;
58-11 (8) any proposed incentive factors; and
58-12 (9) any other information the commission requires.
58-13 (g) Every three years, a municipally owned utility shall
58-14 submit to the commission a report containing all of the information
58-15 required in a preliminary integrated resource plan under Subsection
58-16 (f) of this section, but shall not otherwise be subject to the
58-17 requirements of this section.
58-18 (h) After a utility files its preliminary plan, the
58-19 commission on its own motion or on the motion of the utility or of
58-20 an affected person shall convene a public hearing on the adequacy
58-21 and merits of the preliminary plan. At the hearing, any interested
58-22 person may intervene, present evidence, and cross-examine witnesses
58-23 regarding the contents and adequacy of the preliminary plan.
58-24 Discovery is limited to an issue relating to the development of the
58-25 preliminary plan, a fact issue included in the preliminary plan,
58-26 and other issues the commission is required to decide relating to
58-27 the preliminary plan. A commission hearing is not required for a
59-1 preliminary plan filed by a river authority or generating electric
59-2 cooperative that does not intend to build a new generating plant or
59-3 for a preliminary plan filed by a municipally owned public utility.
59-4 (i) After the hearing, the commission shall determine
59-5 whether:
59-6 (1) the utility's preliminary plan is based on
59-7 substantially accurate data and an adequate method of forecasting;
59-8 (2) the utility's preliminary plan identifies and
59-9 takes into account any present and projected reductions in the
59-10 demand for energy that may result from cost-effective measures to
59-11 improve conservation and energy efficiency in various customer
59-12 classes of the area being served;
59-13 (3) if additional supply-side resources are needed to
59-14 meet future demand, the utility's preliminary plan adequately
59-15 demonstrates:
59-16 (A) the amount and operational characteristics
59-17 of the additional capacity needed;
59-18 (B) the types of viable supply-side resources
59-19 for meeting that need; and
59-20 (C) the range of probable costs of those
59-21 resources;
59-22 (4) the utility's preliminary plan demonstrates the
59-23 opportunities for appropriate persons to participate in the
59-24 development of the preliminary plan;
59-25 (5) the specific criteria the utility will use to
59-26 evaluate and select or reject resources are reasonable and
59-27 consistent with the guidelines of the integrated resource planning
60-1 process;
60-2 (6) the cost allocation method proposed by the utility
60-3 is reasonable; and
60-4 (7) any incentive factors are appropriate and, if so,
60-5 the levels of such incentive factors.
60-6 (j) Not later than the 180th day after the date the utility
60-7 files the preliminary plan, the commission shall issue an interim
60-8 order on the preliminary plan. The commission shall approve the
60-9 preliminary plan, modify the preliminary plan, or, if necessary,
60-10 remand the preliminary plan for additional proceedings. The
60-11 180-day period may be extended for a period not to exceed 30 days
60-12 for extenuating circumstances encountered in the development and
60-13 processing of an initial plan, if the extenuating circumstances are
60-14 fully explained and agreed on by the commissioners.
60-15 (k) On approval of the preliminary plan, the utility shall
60-16 conduct solicitations for demand-side and supply-side resources, as
60-17 prescribed in the preliminary plan. In addition to soliciting
60-18 resources from unaffiliated third parties, the utility may:
60-19 (1) prepare and submit a bid of a new utility
60-20 demand-side management program as prescribed by Subsection (m) of
60-21 this section;
60-22 (2) receive bids from one or more affiliates; and
60-23 (3) request a certificate of convenience and necessity
60-24 for a new rate-based generating plant.
60-25 (l) Each bidder, including the utility and its affiliates,
60-26 shall submit two copies of its bid to the commission. The
60-27 commission shall ensure that the utility has access to all bids at
61-1 the same time. The commission shall keep a copy of each bid
61-2 submitted by the utility or an affiliate to determine whether the
61-3 utility complied with the criteria established for conduct of the
61-4 solicitation. A bid submitted under this subsection or retained
61-5 under this subsection is confidential and is not subject to
61-6 disclosure under Chapter 552, Government Code.
61-7 (m) If a utility wants to use a proposed demand-side
61-8 management program to meet a need identified in the preliminary
61-9 plan, the utility must prepare a bid reflecting that resource. A
61-10 bid prepared by the utility under this subsection must comply with
61-11 the solicitation, evaluation, selection, and rejection criteria
61-12 specified in the preliminary plan. The utility may not give
61-13 preferential treatment or consideration to a bid prepared under
61-14 this subsection.
61-15 (n) The utility shall evaluate each bid submitted, including
61-16 an affiliate bid, in accordance with the criteria specified in the
61-17 preliminary plan and shall negotiate necessary contracts. The
61-18 utility is not required to accept a bid and may reject any or all
61-19 bids in accordance with the selection and rejection criteria
61-20 specified in the preliminary plan. If the results of the
61-21 solicitations and contract negotiations do not meet the supply-side
61-22 needs identified in the preliminary plan, the utility may apply for
61-23 a certificate of convenience and necessity for a utility-owned
61-24 resource addition notwithstanding the fact a solicitation was
61-25 conducted and the addition was not included in the approved
61-26 preliminary plan.
61-27 (o) After conducting the solicitations and negotiating the
62-1 contracts, the utility shall submit to the commission a proposed
62-2 final integrated resource plan. The proposed final plan must
62-3 include:
62-4 (1) the results of the solicitations;
62-5 (2) the contracts for resources;
62-6 (3) the terms and conditions under which the utility
62-7 will provide resources to meet a need identified in the preliminary
62-8 plan, if the utility accepts a bid submitted under Subsection (m)
62-9 of this section; and
62-10 (4) an application for a certificate of convenience
62-11 and necessity, if necessary.
62-12 (p) The commission shall, on request by any affected person
62-13 and within 90 days after the date a utility files its final
62-14 integrated resource plan under this section, convene a public
62-15 hearing on the reasonableness and cost-effectiveness of the
62-16 proposed final plan. At the hearing, any interested person may
62-17 intervene, present evidence, and cross-examine witnesses regarding
62-18 the reasonableness and cost-effectiveness of the proposed final
62-19 plan. Parties will not be allowed to litigate or conduct discovery
62-20 on issues that were litigated or could have been litigated in
62-21 connection with the filing of the utility's preliminary plan. To
62-22 the extent permitted by federal law, the commission may issue a
62-23 written order for access to the books, accounts, memoranda,
62-24 contracts, or records of any exempt wholesale generator or power
62-25 marketer selling energy at wholesale to a utility, if the
62-26 examination is required for the effective discharge of the
62-27 commission's regulatory responsibilities under this Act, except
63-1 that if the commission issues such an order, the books, accounts,
63-2 memoranda, contracts, and records obtained by the commission are
63-3 confidential and not subject to disclosure under Chapter 552,
63-4 Government Code.
63-5 (q) After the hearing, the commission shall determine
63-6 whether:
63-7 (1) the utility's proposed final plan was developed in
63-8 accordance with the preliminary plan and commission rules;
63-9 (2) the resource solicitations, evaluations,
63-10 selections, and rejections were conducted in accordance with the
63-11 criteria included in the preliminary plan;
63-12 (3) the utility's proposed final plan is
63-13 cost-effective;
63-14 (4) the commission should certify the contracts and
63-15 any utility bid submitted under Subsection (m) of this section that
63-16 resulted from the solicitations; and
63-17 (5) the commission should grant a requested
63-18 certificate of convenience and necessity for a utility-owned
63-19 resource addition.
63-20 (r)(1) In determining whether to certify a supply-side or
63-21 demand-side contract that results from the solicitations, the
63-22 commission shall consider the reliability, financial condition, and
63-23 safety of that resource contract and whether the solicitation,
63-24 evaluation, and selection of that resource contract was conducted
63-25 in accordance with the criteria included in the preliminary plan.
63-26 The commission shall not certify contracts for new purchases of
63-27 power by a utility unless the utility has determined, after giving
64-1 consideration to consistently applied regional or national
64-2 reliability standards, guidelines, or criteria, that the contract
64-3 would not unreasonably impair the continued reliability of electric
64-4 systems affected by the purchase, and the purchase can reasonably
64-5 be expected to produce benefits to customers of the purchasing
64-6 utility. Commission certification of a resource contract does not
64-7 negate the necessity of the resource to comply with all applicable
64-8 environmental and siting regulations. In addition, if the contract
64-9 is with a utility affiliate, the commission shall determine whether
64-10 the utility treated and considered the affiliate's bid in the same
64-11 manner it treated and considered other bids intended to meet the
64-12 same resource needs and shall further determine, in connection with
64-13 such purchase, whether:
64-14 (A) the transaction will benefit consumers;
64-15 (B) the transaction violates any state law,
64-16 including least cost planning;
64-17 (C) the transaction provides the utility
64-18 affiliate any unfair competitive advantage by virtue of its
64-19 affiliation or association with the utility;
64-20 (D) the transaction is in the public interest;
64-21 and
64-22 (E) the commission has sufficient regulatory
64-23 authority, resources, and access to the books and records of the
64-24 utility and its affiliate to make these determinations.
64-25 (2) In setting a public utility's rates for a period
64-26 during which a certified contract is effective, the regulatory
64-27 authority shall consider payments made under the contract to be
65-1 reasonable and necessary operating expenses of the public utility.
65-2 The regulatory authority may provide for monthly recovery of the
65-3 approved costs of the contract as those costs are incurred,
65-4 including the allowed mark-up determined by the commission.
65-5 (s) In determining whether to grant a requested certificate
65-6 of convenience and necessity, the commission shall consider the
65-7 effect of the granting of a certificate on the recipient of the
65-8 certificate and on any public utility of the same kind already
65-9 serving the proximate area. The commission shall also consider
65-10 other factors such as community values, recreational and park
65-11 areas, historical and aesthetic values, environmental integrity,
65-12 and the probable improvement of service or lowering of cost to
65-13 consumers in that area if the certificate is granted. The
65-14 commission shall grant the certificate as part of the approval of
65-15 the final plan if it finds that:
65-16 (1) the proposed addition is necessary under the final
65-17 plan;
65-18 (2) the proposed addition is the best and most
65-19 economical choice of technology for that service area; and
65-20 (3) cost-effective conservation and other
65-21 cost-effective alternative energy sources cannot reasonably meet
65-22 the need.
65-23 (t) Not later than the 180th day after the date the utility
65-24 files the proposed final plan, the commission shall issue a final
65-25 order on the plan. The commission shall approve the proposed final
65-26 plan, modify the proposed final plan, or, if necessary, remand the
65-27 proposed final plan for additional proceedings.
66-1 (u) The commission shall adopt rules allowing a utility to
66-2 add, consistent with the utility's last approved integrated
66-3 resource planning goals, new or incremental resources outside the
66-4 solicitation process, including resources listed in Subsection (x)
66-5 of this section.
66-6 (v) In addition to its other authority and responsibility
66-7 under this section, the commission shall establish rules and
66-8 guidelines that will promote the development of renewable energy
66-9 technologies consistent with the guidelines of the integrated
66-10 resource planning process.
66-11 (w) In carrying out its duties related to the integrated
66-12 resource planning process, the commission may:
66-13 (1) allow timely recovery of reasonable costs of
66-14 conservation, load management, and purchased power, notwithstanding
66-15 Section 2.212(g)(1) of this Act;
66-16 (2) authorize additional incentives for conservation,
66-17 load management, purchased power, and renewable resources;
66-18 (3) require a utility to provide transmission service,
66-19 exclusively for the purposes of transmitting wholesale power, to
66-20 another utility or any other entity authorized to generate and sell
66-21 electricity or to a power marketer; and
66-22 (4) review the state's transmission system to
66-23 determine and make recommendations to public utilities on the need
66-24 to build new power lines, upgrade power lines, and make other
66-25 improvements and additions as necessary, and who should pay the
66-26 direct and indirect cost of these improvements if made, review the
66-27 actions of the public utilities in light of those recommendations,
67-1 and take those actions into account in fixing a reasonable return
67-2 on invested capital under Section 2.203(b) of this Act.
67-3 (x) Consistent with the utility's last approved integrated
67-4 resource planning goals, if any, the utility, including a
67-5 nongenerating utility, may add new or incremental resources outside
67-6 the solicitation process such as:
67-7 (1) contract renegotiation for existing capacity from
67-8 an electric cooperative or nonaffiliated power generating
67-9 facilities;
67-10 (2) electric cooperative or nonaffiliated demand-side
67-11 management programs or renewable resources;
67-12 (3) capacity purchases with terms of two years or less
67-13 from an electric cooperative or nonaffiliated power suppliers or
67-14 capacity purchases necessary to satisfy unanticipated emergency
67-15 conditions;
67-16 (4) the exercise of an option in a purchased power
67-17 contract with an electric cooperative or nonaffiliated supplier;
67-18 and
67-19 (5) renewable distributed resources, located at or
67-20 near the point of consumption, if they are less costly than
67-21 transmission extensions or upgrades.
67-22 (y) The addition of new or incremental resources by a
67-23 utility under Subsection (x) of this section does not require an
67-24 amendment to the utility's integrated resource plan.
67-25 (z)(1) If a qualifying facility submits a bid under this
67-26 section, regardless of whether that bid is accepted or rejected,
67-27 and only with respect to the capacity need for which the bid has
68-1 been submitted, the submission of the bid:
68-2 (A) constitutes a waiver by the qualifying
68-3 facility of any rights it may otherwise have under law to sell
68-4 capacity to the utility;
68-5 (B) represents the qualifying facility's
68-6 agreement to negotiate a rate for purchase of capacity and terms
68-7 and conditions relating to any purchase of capacity by the utility
68-8 that differ from the rate or terms and conditions that would
68-9 otherwise be required by 18 CFR Chapter I, Subchapter K, Part 292,
68-10 Subpart C; and
68-11 (C) constitutes a waiver by the qualifying
68-12 facility of its right to the rate, terms, or conditions for
68-13 purchases of capacity by the utility that might otherwise be
68-14 required by that subpart.
68-15 (2) For the purpose of determining a utility's avoided
68-16 capacity costs under 18 CFR Chapter I, Subchapter K, Part 292,
68-17 Subpart C, on submitting a preliminary integrated resource plan to
68-18 the commission under Section 2.051 of this Act, the utility's
68-19 avoided capacity costs shall be deemed to be $0 and shall remain
68-20 $0, with respect to any capacity needs shown in such preliminary
68-21 integrated resource plan or final integrated resource plan that are
68-22 to be satisfied by resources approved in the utility's final
68-23 integrated resource plan.
68-24 (3) Nothing in this subsection shall affect the
68-25 validity of any contract entered into between a qualifying facility
68-26 and an electric utility for any purchase.
68-27 (aa) In this section, "utility" includes a river authority
69-1 subject to Section 2.0012 of this Act with respect to the area
69-2 served by the river authority on January 1, 1975.
69-3 (bb) Nongenerating utilities not planning to construct
69-4 generating resources are not required to submit an integrated
69-5 resource plan to the commission. If such a utility seeks to
69-6 purchase more than 25 percent of its peak demand or more than 70
69-7 megawatts from a wholesale power supplier other than its existing
69-8 power supplier, the utility shall conduct a solicitation for
69-9 resources. However, no solicitation is required for purchases from
69-10 an existing power supplier, and new or incremental resources may be
69-11 added outside the solicitation process as provided in Subsection
69-12 (x) of this section. If requested by such a utility, the
69-13 commission may review the reasonableness of any contract for
69-14 resources resulting from the solicitation. On a finding by the
69-15 commission that such a contract is reasonable, the commission shall
69-16 certify the contract. The commission shall make its determination
69-17 within 90 days after the date the proposed contract is submitted.
69-18 Nothing in this subsection is intended to alter or amend existing
69-19 wholesale power supply contracts.
69-20 (cc) To the extent that the commission authorizes utilities
69-21 to recover costs of demand-side management programs, conservation,
69-22 load management, or purchased power through various cost recovery
69-23 factors, the commission shall make a final reconciliation of the
69-24 costs recovered through those cost recovery factors. The
69-25 commission shall adopt rules regarding when the reconciliations
69-26 will occur for each of the cost recovery factors, what type of
69-27 information utilities need to file in support of the
70-1 reconciliation, and other matters necessary to perform the
70-2 reconciliation. The reconciliation shall (1) review the
70-3 reasonableness of the utility's administration of the contracts and
70-4 programs whose costs are being reconciled and (2) reconcile the
70-5 revenue collected under each cost recovery factor and the costs
70-6 that the utility incurred on purchased power, demand-side
70-7 management, conservation, or load management during the
70-8 reconciliation period.
70-9 (dd) To provide for the orderly transition to an integrated
70-10 resource planning process and to avoid delays in the construction
70-11 of resources necessary to provide electric service, an integrated
70-12 resource plan shall not be required prior to the issuance of a
70-13 certificate of convenience and necessity for the construction of
70-14 generating facilities if:
70-15 (1) the commission has approved the utility's notice
70-16 of intent prior to the effective date of this section;
70-17 (2) the utility has conducted a solicitation for
70-18 resources to meet the need identified in the utility's notice of
70-19 intent in accordance with commission rules then in effect; and
70-20 (3) the utility has submitted to the commission the
70-21 results of the solicitation and an application for certification of
70-22 facilities to meet the need identified in the utility's notice of
70-23 intent. A certificate of convenience and necessity shall be
70-24 granted by the commission if the facilities are needed to meet
70-25 future demand, the facilities are the best and most economical
70-26 choice of technology for the service area, and cost-effective
70-27 conservation and cost-effective alternative energy sources cannot
71-1 reasonably meet the need. <ELECTRICAL FORECAST. (a) The
71-2 commission shall develop a long-term statewide electrical energy
71-3 forecast which shall be sent to the governor biennially. The
71-4 forecast will include an assessment of how alternative energy
71-5 sources, conservation, and load management will meet the state's
71-6 electricity needs.>
71-7 <(b) Every generating electric utility in the state shall
71-8 prepare and transmit to the commission every two years a report
71-9 specifying at least a 10-year forecast for assessments of load and
71-10 resources for its service area. The report shall include a list of
71-11 facilities which will be required to supply electric power during
71-12 the forecast periods. The report shall be in a form prescribed by
71-13 the commission. The report shall include:>
71-14 <(1) a tabulation of estimated peak load, resources,
71-15 and reserve margins for each year during the forecast or assessment
71-16 period;>
71-17 <(2) a list of existing electric generating plants in
71-18 service with a description of planned and potential generating
71-19 capacity at existing sites;>
71-20 <(3) a list of facilities which will be needed to
71-21 serve additional electrical requirements identified in the
71-22 forecasts or assessments, the general location of such facilities,
71-23 and the anticipated types of fuel to be utilized in the proposed
71-24 facilities, including an estimation of shutdown costs and disposal
71-25 of spent fuel for nuclear power plants;>
71-26 <(4) a description of additional system capacity which
71-27 might be achieved through, among other things, improvements in:>
72-1 <(A) generating or transmission efficiency;>
72-2 <(B) importation of power;>
72-3 <(C) interstate or interregional pooling;>
72-4 <(D) other improvements in efficiencies of
72-5 operation; and>
72-6 <(E) conservation measures;>
72-7 <(5) an estimation of the mix and type of fuel
72-8 resources for the forecast or assessment period;>
72-9 <(6) an annual load duration curve and a forecast of
72-10 anticipated peak loads for the forecast or assessment period for
72-11 the residential, commercial, industrial, and such other major
72-12 demand sectors in the service area of the electric utility as the
72-13 commission shall determine; and>
72-14 <(7) a description of projected population growth,
72-15 urban development, industrial expansion, and other growth factors
72-16 influencing increased demand for electric energy and the basis for
72-17 such projections.>
72-18 <(c) The commission shall establish and every electric
72-19 utility shall utilize a reporting methodology for preparation of
72-20 the forecasts of future load and resources.>
72-21 <(d) The commission shall review and evaluate the electric
72-22 utilities' forecast of load and resources and any public comment on
72-23 population growth estimates prepared by the Bureau of Business
72-24 Research, The University of Texas at Austin.>
72-25 <(e) Within 12 months after the receipt of the reports
72-26 required by this section, the commission shall hold a public
72-27 hearing and subsequently issue a final report to the governor and
73-1 notify every electric utility of the commission's electric forecast
73-2 for that utility. The commission shall consider its electric
73-3 forecast in all certification proceedings covering new generation
73-4 plants.>
73-5 SECTION 2.04. Section 2.052, Public Utility Regulatory Act
73-6 of 1995, as enacted by S.B. No. 319, Acts of the 74th Legislature,
73-7 Regular Session, 1995, is amended to read as follows:
73-8 Sec. 2.052. ENCOURAGEMENT OF ECONOMICAL PRODUCTION.
73-9 (a) The commission shall make and enforce rules to encourage the
73-10 economical production of electric energy by qualifying cogenerators
73-11 and qualifying small power producers.
73-12 (b) A qualifying cogenerator or qualifying small power
73-13 producer may sell electric energy in this state only at wholesale,
73-14 except that a qualifying cogenerator may sell electric energy at
73-15 retail to the sole purchaser of the cogenerator's thermal output.
73-16 (c) The retail rates of an electric utility shall be
73-17 approved by the regulatory authority in accordance with the
73-18 principles of this Act to assure that they are just and reasonable.
73-19 The electric utility, at its option, however, has the legal
73-20 authority to charge individual customers for electric service at a
73-21 price that is lower than the rate approved by a regulatory
73-22 authority but equal to or greater than the marginal cost of the
73-23 utility as provided in this subsection. The net present value of
73-24 prices charged pursuant to this subsection must equal or exceed the
73-25 net present value of the marginal cost of the utility for each
73-26 customer for the term of the customer contract for which a price is
73-27 offered and shall only be applicable for service to:
74-1 (1) the existing load of an existing customer of the
74-2 utility, and further provided the customer demonstrates to the
74-3 utility that, without the offered price, it will cease receiving
74-4 service from the utility or reduce its load as a result of
74-5 switching to alternative energy sources, switching to service by
74-6 another electric utility, self-generation, cogeneration,
74-7 relocation, closure, or shutdown; an electric utility may not
74-8 provide electric service at a price less than its approved rate to
74-9 any existing customer load in a multicertificated service area
74-10 unless the customer is connected to and has taken service from the
74-11 utility continuously for the previous 30 months;
74-12 (2) the existing load of an existing customer of the
74-13 utility operating a marginal oil or gas property, if the customer
74-14 demonstrates to the utility that a price that is lower than the
74-15 rate approved by a regulatory authority will extend the economic
74-16 life of the marginal oil or gas property. An electric utility may
74-17 not, however, provide electric service at a price less than its
74-18 approved rate to any marginal oil or gas property in a
74-19 multicertificated service area unless the customer is connected to
74-20 and has taken service from the utility continuously for the
74-21 previous 30 months. A marginal oil and gas property means any well
74-22 or group of wells and related facilities, located within the
74-23 service area of a utility serviced by the electrical meter of a
74-24 utility, that produced on average either:
74-25 (A) 15 barrels of oil equivalent or less per
74-26 well during the preceding 12 months based upon the records of the
74-27 Railroad Commission of Texas; or
75-1 (B) 25 barrels of oil equivalent or less per
75-2 well and the average water cut is equal to or greater than 95
75-3 percent during the preceding 12 months based on the records of the
75-4 Railroad Commission of Texas; or
75-5 (C) any enhanced oil recovery project; or
75-6 (3) the new load, if located in the singly
75-7 certificated service area of the utility, of a new or existing
75-8 customer, provided the customer demonstrates to the utility that,
75-9 without the offered price, the new customer will not take service
75-10 from the utility for such new load.
75-11 (d) No electric utility shall, pursuant to this subsection,
75-12 offer, demand, charge, or receive for retail electric service a
75-13 price that is lower than the rate approved by a regulatory
75-14 authority for service to new load of a new customer if the load is
75-15 located in a multicertificated service area. An electric utility
75-16 may not provide electric service at a price less than its approved
75-17 rate to any existing customer of another utility in a
75-18 multicertificated service area or to any customer load in a
75-19 multicertificated service area that was connected to and received
75-20 service from another electric utility at any time during the
75-21 previous 36 months.
75-22 (e) A price in accordance with Subsection (c) of this
75-23 section shall only be available to a customer in a
75-24 multicertificated service area receiving service at 480 volts or
75-25 higher. A price in accordance with Subsection (c) of this section
75-26 shall only be available for a term of 120 months or less.
75-27 (f) If an electric utility charges a price in accordance
76-1 with Subsection (c) of this section for retail electric utility
76-2 service that is lower than the rate approved by a regulatory
76-3 authority, it shall submit the following information to the
76-4 commission at least 35 days prior to the proposed implementation of
76-5 the price:
76-6 (1) the customer contract, including name and address
76-7 of the customer;
76-8 (2) an analysis demonstrating that the price is within
76-9 the range of prices allowed under this section;
76-10 (3) the approved rate that would be applicable in the
76-11 absence of any such lower price;
76-12 (4) whether the load is a new or existing load,
76-13 whether the customer is a new or existing customer, that the load
76-14 is located in a singly certificated service area or in a
76-15 multicertificated service area;
76-16 (5) the number of months the load has been
76-17 continuously connected to and served by the utility;
76-18 (6) if the load is located in a multicertificated
76-19 area, the commission shall require sworn affidavits stating each of
76-20 the particular facts within affiant's personal knowledge necessary
76-21 to establish that the customer qualifies for the price and that the
76-22 price meets the criteria of this section; and
76-23 (7) if the load is located in a multicertificated
76-24 service area, a sworn affidavit of the affiant's personal knowledge
76-25 that the utility has concurrently notified any other electric
76-26 utilities having authority to provide retail service to the load
76-27 and such other information as may be determined by the commission.
77-1 (g) The commission shall have exclusive original
77-2 jurisdiction to review any price proposed by an electric utility
77-3 pursuant to Subsection (c) of this section. To assure compliance
77-4 with the criteria of this section, for prices proposed to be
77-5 charged for service to loads in multicertificated areas, the
77-6 commission shall, within 60 days after the effective date of this
77-7 section, establish procedures for administrative review. The
77-8 commission shall determine compliance with Subsections (c), (d),
77-9 (e), and (f) of this section, including whether the price is within
77-10 the range of prices allowed as well as eligibility of the customer
77-11 and load for the proposed price. The commission may reserve other
77-12 issues to be determined in later proceedings. In establishing
77-13 procedures, the commission shall provide for suspension of
77-14 implementation of a price for a period of 60 days if the commission
77-15 finds a reasonable need for additional time for an affected person,
77-16 including a competing utility, to investigate the utility's
77-17 compliance with this section. If the commission determines that a
77-18 violation of Subsection (c), (d), (e), or (f) of this section has
77-19 occurred, the commission shall disallow the price. Otherwise the
77-20 price shall be approved. Any final administrative action shall be
77-21 appealable to the commission by any party.
77-22 (h) Prior to its first integrated resource plan filing,
77-23 electric utilities desiring to charge a price pursuant to this
77-24 section shall, except as provided in Subsection (i) of this
77-25 section, file with the commission a methodology for calculation of
77-26 its marginal cost. The methodology for calculating the marginal
77-27 cost of the electric utility shall consist of energy and capacity
78-1 components. The energy component shall include variable operation
78-2 and maintenance expense and marginal fuel or the energy component
78-3 of purchased power. The capacity component included shall be based
78-4 on the annual economic value of deferring, accelerating, or
78-5 avoiding the next increment of any needed capacity, whether such
78-6 capacity is purchased or built. The commission shall ensure that
78-7 the methodology for determining marginal cost is consistently
78-8 applied among utilities but may recognize in any case the
78-9 individual load and resource requirements of the utility. The
78-10 commission shall determine the marginal cost for each utility
78-11 within 180 days after an application is filed; however, no
78-12 application for approval of marginal cost shall be deemed to have
78-13 been filed less than 90 days after the effective date of this
78-14 section. If the commission does not approve the marginal cost
78-15 within the time prescribed, the filed marginal cost shall be deemed
78-16 approved.
78-17 (i) For utilities that do not file an integrated resource
78-18 plan or do not generate electricity, the marginal cost shall be the
78-19 lowest marginal cost of any of the utility's wholesale power
78-20 suppliers unless otherwise determined by the commission on
78-21 application by the utility.
78-22 (j) The commission shall periodically redetermine an
78-23 electric utility's marginal cost in connection with approval of the
78-24 utility's integrated resource plan under this section.
78-25 (k) Nothing contained in this section shall have the effect
78-26 of limiting the authority of the regulatory authority to change the
78-27 rates or establish new rates of electric utilities as provided for
79-1 in other sections of this Act, nor shall the validity of any lawful
79-2 rate previously set by a regulatory authority be affected by this
79-3 section.
79-4 (l) Generating and transmission electric cooperatives have
79-5 the legal authority, pursuant to this subsection, to charge
79-6 wholesale customers for electric service at a price that is lower
79-7 than the rate approved by a regulatory authority, provided that
79-8 each of the following conditions is met:
79-9 (1) the price shall only be applicable for that
79-10 portion of a distribution cooperative's retail load for which the
79-11 retail price is determined pursuant to Subsection (c) of this
79-12 section;
79-13 (2) the price shall not be less than the generating
79-14 and transmission cooperative's marginal cost for that portion of
79-15 the customer's retail load for which the retail price is determined
79-16 pursuant to Subsection (c) of this section.
79-17 (m) Rates established under this section shall not be
79-18 unreasonably preferential, prejudicial, or discriminatory;
79-19 subsidized either directly or indirectly by the utility's other
79-20 customers; or predatory or anticompetitive. For service provided
79-21 under this section, the commission shall ensure that the utility's
79-22 allocable costs of serving customers paying discounted retail
79-23 prices are not borne by the utility's other customers.
79-24 SECTION 2.05. Subtitle B, Title II, Public Utility
79-25 Regulatory Act of 1995, as enacted by S.B. No. 319, Acts of the
79-26 74th Legislature, Regular Session, 1995, is amended by adding
79-27 Section 2.053 to read as follows:
80-1 Sec. 2.053. EXEMPT WHOLESALE GENERATORS AND POWER MARKETERS.
80-2 (a) An exempt wholesale generator or power marketer may sell
80-3 electric energy only at wholesale.
80-4 (b) The commission has the following jurisdiction over
80-5 exempt wholesale generators and power marketers that sell electric
80-6 energy in this state:
80-7 (1) to require registration as provided by Subsection
80-8 (c) of this section; and
80-9 (2) to require the filing of reports the commission
80-10 prescribes by rule.
80-11 (c) Each exempt wholesale generator and power marketer
80-12 shall, within 30 days after the date it becomes subject to this
80-13 section, register with the commission or provide proof that it has
80-14 registered with the Federal Energy Regulatory Commission or been
80-15 authorized by the Federal Energy Regulatory Commission to sell
80-16 electric energy at market-based rates. Registration may be
80-17 accomplished by filing with the commission a description of the
80-18 location of any facility used to provide service, the type of
80-19 service provided, a copy of any information filed with the Federal
80-20 Energy Regulatory Commission in connection with registration with
80-21 that commission, and other information the commission prescribes by
80-22 rule.
80-23 SECTION 2.06. Subtitle B, Title II, Public Utility
80-24 Regulatory Act of 1995, as enacted by S.B. No. 319, Acts of the
80-25 74th Legislature, Regular Session, 1995, is amended by adding
80-26 Section 2.054 to read as follows:
80-27 Sec. 2.054. EXEMPT WHOLESALE GENERATOR AND POWER MARKETER
81-1 AFFILIATES. (a) An affiliate of a public utility may be an exempt
81-2 wholesale generator or power marketer and may sell electric energy
81-3 to its affiliated public utility in accordance with Section 2.051
81-4 of this Act and other provisions of law governing wholesale sales
81-5 of electric energy.
81-6 (b) If a rate or charge for or in connection with the
81-7 construction of a facility, or for electric energy produced by the
81-8 construction of a facility, or for electric energy produced by a
81-9 facility other than any portion of a rate or charge which
81-10 represents recovery of the cost of a wholesale rate or charge was
81-11 in effect as of the date of enactment of this section, the facility
81-12 shall not be sold, transferred to an affiliate, or otherwise
81-13 considered an eligible facility as defined by federal law. The
81-14 commission may, after notice and hearing, allow such facility to be
81-15 sold, transferred to an affiliate, or become an eligible facility
81-16 only if such sale or transfer will benefit ratepayers of the
81-17 utility making the sale or transfer, is in the public interest, and
81-18 otherwise complies with state law.
81-19 SECTION 2.07. Subtitle B, Title II, Public Utility
81-20 Regulatory Act of 1995, as enacted by S.B. No. 319, Acts of the
81-21 74th Legislature, Regular Session, 1995, is amended by adding
81-22 Section 2.056 to read as follows:
81-23 Sec. 2.056. TRANSMISSION SERVICE. (a) The commission may
81-24 require a utility, including a municipally owned utility, to
81-25 provide transmission service at wholesale to another utility, a
81-26 qualifying facility, an exempt wholesale generator, or a power
81-27 marketer and may determine whether the terms and conditions for the
82-1 transmission service are reasonable. The commission may require
82-2 transmission service at wholesale, including construction or
82-3 enlargement of facilities, in a proceeding not related to approval
82-4 of an integrated resource plan. The commission may not issue a
82-5 decision or rule relating to transmission service that is contrary
82-6 to an applicable decision, rule, or policy statement of a federal
82-7 regulatory agency having jurisdiction.
82-8 (b) The commission, with the advice and consent of the
82-9 governor, shall appoint a five-person interstate connection
82-10 committee to investigate the most economical, reliable, and
82-11 efficient means to synchronously interconnect the alternating
82-12 current electric facilities of the electric facilities of electric
82-13 utilities within the Electric Reliability Council of Texas
82-14 reliability area to the alternating current electric facilities of
82-15 the electric facilities of electric utilities within the Southwest
82-16 Power Pool reliability area. The committee shall report an
82-17 estimate of the cost and benefit to effect the interconnection, an
82-18 estimate of the time to construct the interconnecting facilities,
82-19 and the service territory of the utilities in which those
82-20 facilities will be located. The committee shall submit its report
82-21 to the legislature by September 1, 1997, at which time the
82-22 committee shall be dissolved.
82-23 SECTION 2.08. Subtitle B, Title II, Public Utility
82-24 Regulatory Act of 1995, as enacted by S.B. No. 319, Acts of the
82-25 74th Legislature, Regular Session, 1995, is amended by adding
82-26 Section 2.057 to read as follows:
82-27 Sec. 2.057. WHOLESALE COMPETITION. (a) A public utility
83-1 that owns or operates transmission facilities shall provide
83-2 wholesale transmission service at rates, terms of access, and
83-3 conditions that are comparable to the rates, terms of access, and
83-4 conditions of the utility's use of its system. The commission
83-5 shall ensure that utilities provide nondiscriminatory access to
83-6 transmission service for qualifying facilities, exempt wholesale
83-7 generators, power marketers, and public utilities. The commission
83-8 shall adopt rules within 180 days of the effective date of this
83-9 section relating to wholesale transmission service, rates, and
83-10 access. The rules shall be consistent with the standards in this
83-11 section, shall not be contrary to federal law, including any
83-12 applicable policy statement, decision, or rule of a federal
83-13 regulatory agency, having jurisdiction and shall require
83-14 transmission services that are not less than the transmission
83-15 services the Federal Energy Regulatory Commission may require in
83-16 similar circumstances. The rules shall also provide that all
83-17 ancillary services associated with a utility's discounted wholesale
83-18 sales shall be provided by the utility at the same prices and under
83-19 the same terms and conditions as such services are provided to
83-20 third persons, and all ancillary services provided by the utility
83-21 and associated with its discounted wholesale sales also be provided
83-22 to third persons upon request. All public utilities that own or
83-23 operate transmission facilities shall file tariffs implementing
83-24 such rules within 60 days after the commission has adopted
83-25 transmission pricing and access rules pursuant to this section
83-26 unless the terms and conditions for access and pricing are included
83-27 in the tariff of another utility. Such tariffs shall be filed with
84-1 the appropriate state or federal regulatory agency having
84-2 jurisdiction over the transmission service of the entity filing the
84-3 tariff.
84-4 (b) The commission shall adopt rules relating to the
84-5 registration and reporting requirements of qualifying facilities,
84-6 exempt wholesale generators, and power marketers.
84-7 (c) The regulatory authority may not require a public
84-8 utility to wheel or transmit electricity over that public utility's
84-9 facilities from another entity to an ultimate consumer of
84-10 electricity in the utility's certificated service area, including
84-11 wheeling or transmitting electricity to another location of that
84-12 other entity, if the entity is an ultimate consumer of electricity.
84-13 (d) To the extent a utility provides transmission of
84-14 electric energy at the request of a third party, the commission
84-15 shall ensure that the costs of the transmission are not borne by
84-16 the utility's other customers by requiring the utility to recover
84-17 from the entity for which the transmission is provided all
84-18 reasonable costs incurred by the utility in providing transmission
84-19 services necessary for the transaction.
84-20 (e) For the purposes of administering these rules, the
84-21 commission may require that parties to a dispute over the prices,
84-22 terms, and conditions of wholesale transmission service engage in a
84-23 nonbinding alternative dispute resolution process before seeking a
84-24 resolution of a dispute from the commission.
84-25 (f) The commission shall submit a report to the 75th
84-26 Legislature on methods or procedures for quantifying the magnitude
84-27 of stranded investment, procedures for allocating costs, and the
85-1 acceptable methods of recovering stranded costs.
85-2 (g) Affiliates of public utilities, exempt wholesale
85-3 generators, qualifying facilities, and all other providers of
85-4 generation may compete for the business of selling power to a third
85-5 party that is not an ultimate consumer of electricity. In
85-6 accordance with the applicable provisions of this Act, a public
85-7 utility may purchase power from an affiliate. A public utility may
85-8 not grant undue preference to any person in connection with the
85-9 utility's purchase or sale of electric energy at wholesale or other
85-10 utility services.
85-11 (h)(1) Notwithstanding any other provision of this Act, the
85-12 commission shall entertain proposals for and, from such proposals,
85-13 adopt a pilot program to require a public utility, on order of the
85-14 commission, to provide transmission service to a self-generating or
85-15 qualifying cogenerating customer of such public utility. Such
85-16 transmission service approved by the commission shall be solely for
85-17 the purpose of transmitting electricity generated by the customer
85-18 from the site of generation to another site or sites 100 percent
85-19 owned by such customer. The pilot program shall last three years
85-20 from the time that the commission issues an order requiring a
85-21 utility to transmit electricity pursuant to this section, after
85-22 which the commission shall report to the legislature whether there
85-23 occurred any harmful effects on the utility or on its ratepayers or
85-24 if any harmful effects would occur if the transmission service were
85-25 to be continued.
85-26 (2) The commission shall adopt such limits on the
85-27 availability of transmission service under this section as it finds
86-1 necessary to protect ratepayers. The commission must make an
86-2 affirmative finding, prior to issuing an order, that the pilot
86-3 program:
86-4 (A) is in the public interest;
86-5 (B) will not adversely affect the ratepayers of
86-6 the transmitting utility;
86-7 (C) does not unreasonably impair the
86-8 transmitting utility's reliability; and
86-9 (D) is priced based on the embedded cost of
86-10 providing service plus a reasonable rate of return.
86-11 (3) If at any time during the course of the pilot
86-12 program, the commission determines that the program is adversely
86-13 affecting the ratepayers of the transmitting utility, the
86-14 commission shall issue an order to terminate the program as soon as
86-15 practicable.
86-16 (i) For the purposes of this section, the term "public
86-17 utility" shall include municipally owned utilities.
86-18 SECTION 2.09. Subtitle B, Title II, Public Utility
86-19 Regulatory Act of 1995, as enacted by S.B. No. 319, Acts of the
86-20 74th Legislature, Regular Session, 1995, is amended by adding
86-21 Section 2.059 to read as follows:
86-22 Sec. 2.059. ELECTRIC UTILITIES; REGULATION OF COMPETITION.
86-23 (a) It is the policy of this state to protect the public interest
86-24 in having adequate and efficient electric service available to
86-25 consumers at just, fair, and reasonable rates. The legislature
86-26 finds that the electric industry, through technical advancements,
86-27 federal legislative and administrative actions, and the formulation
87-1 of new electric enterprises, can become in many and growing areas a
87-2 competitive industry that does not lend itself to traditional
87-3 public utility regulatory rules and policies and that, therefore,
87-4 the public interest requires that new rules and policies be
87-5 formulated and applied to protect the public interest and to
87-6 provide equal opportunity to all electric service providers in a
87-7 competitive marketplace. It is the purpose of this section to
87-8 grant to the commission the authority to carry out the public
87-9 policy herein stated.
87-10 (b) For the purpose of carrying out the public policy stated
87-11 in Subsection (a) of this section, and any other section of this
87-12 Act notwithstanding, the commission is granted all necessary power
87-13 and authority to promulgate rules and establish procedures
87-14 applicable to public utilities to facilitate the development of
87-15 competition consistent with the public interest and, where the
87-16 commission determines that sufficient competition exists in
87-17 specific electric markets or submarkets, to provide appropriate
87-18 regulatory treatment to allow electric utilities to respond to
87-19 significant competitive challenges. Nothing in this section is
87-20 intended to change the burden of proof of an electric utility under
87-21 Sections 2.202, 2.203, 2.204, 2.205, 2.206, 2.207, and 2.208 of
87-22 this Act for services that are not subject to such competitive
87-23 challenges.
87-24 (c) In promulgating rules and policies under this section,
87-25 the commission shall seek to balance the public interest in a
87-26 technologically advanced electric system providing services that
87-27 are attractive to consumers with traditional regulatory concerns
88-1 for preserving the quality and availability of service, prohibiting
88-2 anti-competitive pricing and practices, preventing the
88-3 subsidization of competitive services with revenues from regulated
88-4 monopoly services, and maintaining rates that are not unreasonably
88-5 preferential, prejudicial, or discriminatory and that are not
88-6 subsidized either directly or indirectly by regulated monopoly
88-7 services. The commission shall promulgate these rules and
88-8 procedures so as to incorporate an appropriate mix of regulatory
88-9 and market mechanisms reflecting the level and nature of
88-10 competition in the marketplace.
88-11 SECTION 2.10. Subsection (a), Section 2.101, Public Utility
88-12 Regulatory Act of 1995, as enacted by S.B. No. 319, Acts of the
88-13 74th Legislature, Regular Session, 1995, is amended to read as
88-14 follows:
88-15 (a) Subject to the limitations imposed by Sections 2.2011
88-16 and 2.211 of <in> this Act, and for the purpose of regulating rates
88-17 and services so that such rates may be fair, just, and reasonable,
88-18 and the services adequate and efficient, the governing body of each
88-19 municipality shall have exclusive original jurisdiction over all
88-20 retail electric utility rates, operations, and services provided by
88-21 an electric utility within its city or town limits.
88-22 SECTION 2.11. Section 2.105, Public Utility Regulatory Act
88-23 of 1995, as enacted by S.B. No. 319, Acts of the 74th Legislature,
88-24 Regular Session, 1995, is amended by adding Subsection (c) to read
88-25 as follows:
88-26 (c) Not later than the 31st day before the date a utility
88-27 files a statement of intent under Section 2.212(a) of this Act, the
89-1 utility shall provide to each municipality having original
89-2 jurisdiction notice of intent to file the statement. Not later
89-3 than the 30th day after the date a municipality receives notice of
89-4 intent to file a statement, the municipality may request that the
89-5 utility file with the municipality a statement of intent in
89-6 accordance with Section 2.212(a) of this Act. If requested, the
89-7 utility shall file the statement of intent with the municipality at
89-8 the same time the statement is filed with the commission.
89-9 SECTION 2.12. Subtitle D, Title II, Public Utility
89-10 Regulatory Act of 1995, as enacted by S.B. No. 319, Acts of the
89-11 74th Legislature, Regular Session, 1995, is amended by adding
89-12 Section 2.1511 to read as follows:
89-13 Sec. 2.1511. MARK-UP. Any cost recovery factor established
89-14 for recovery of purchased power costs may include the costs
89-15 incurred by the utility for the purchase of capacity and energy,
89-16 together with a mark-up added to the costs or other mechanism, as
89-17 determined by the commission, to reasonably compensate the utility
89-18 for financial risks, if any, to the utility associated with
89-19 purchased power obligations and the value added by the utility in
89-20 making the purchased power available to its customers. Such
89-21 mark-ups are an exceptional form of rate relief which may be
89-22 recovered from ratepayers only on entry of a finding by the
89-23 commission that such relief is necessary to maintain the financial
89-24 integrity of the utility. The mark-ups and cost recovery factors,
89-25 if allowed, may be those that are necessary to encourage the
89-26 utility to include economical purchased power as part of its energy
89-27 and capacity resource supply plan.
90-1 SECTION 2.13. Section 2.152, Public Utility Regulatory Act
90-2 of 1995, as enacted by S.B. No. 319, Acts of the 74th Legislature,
90-3 Regular Session, 1995, is amended by adding Subsection (e) to read
90-4 as follows:
90-5 (e) Reasonable costs of participating in a proceeding under
90-6 this Act may be allowed, not to exceed the amount approved by the
90-7 regulatory authority.
90-8 SECTION 2.14. Subsection (b), Section 2.154, Public Utility
90-9 Regulatory Act of 1995, as enacted by S.B. No. 319, Acts of the
90-10 74th Legislature, Regular Session, 1995, is amended to read as
90-11 follows:
90-12 (b) Every public utility shall file with, and as a part of
90-13 such schedules, all rules and regulations relating to or affecting
90-14 the rates, public utility service, product, or commodity furnished
90-15 by such utility. The commission shall treat customer names and
90-16 addresses, prices, individual customer contracts, and expected load
90-17 and usage data as highly sensitive trade secrets, and such
90-18 information shall not be subject to disclosure under the open
90-19 records law, Chapter 552, Government Code.
90-20 SECTION 2.15. Subtitle E, Title II, Public Utility
90-21 Regulatory Act of 1995, as enacted by S.B. No. 319, Acts of the
90-22 74th Legislature, Regular Session, 1995, is amended by adding
90-23 Section 2.2011 to read as follows:
90-24 Sec. 2.2011. ELECTRIC COOPERATIVE EXEMPTION. (a) An
90-25 electric cooperative corporation that provides retail electric
90-26 utility service at distribution voltage is exempt from rate
90-27 regulation if a majority of the members voting in an election on
91-1 the deregulation of the electric cooperative vote to approve the
91-2 exemption and the electric cooperative sends notice of the action
91-3 to each applicable regulatory authority. An electric cooperative
91-4 that wants to hold an election under this section shall send a
91-5 ballot by mail to each electric cooperative member. The electric
91-6 cooperative may include the ballot in a monthly billing. The
91-7 ballot shall provide for voting for or against rate deregulation of
91-8 the electric cooperative. If the proposition is approved, the
91-9 electric cooperative shall send each ballot to the commission not
91-10 later than the 10th day after the date the electric cooperative
91-11 counts the ballots. Based on the ballots received, the commission
91-12 shall administratively certify that the electric cooperative is or
91-13 is not deregulated for rate-making purposes. An electric
91-14 cooperative may not hold another election on the issue of being
91-15 exempt from rate regulation before the first anniversary of the
91-16 most recent election on the issue. Subsections (b) through (n) of
91-17 this section apply to an electric cooperative that has elected to
91-18 be exempt from rate regulation.
91-19 (b) No regulatory authority shall fix and regulate the rates
91-20 of an electric cooperative that has made an election under this
91-21 section to be exempt from rate regulation except as provided for
91-22 the commission in Subsections (g) and (i) of this section.
91-23 Notwithstanding Section 2.101(a) of this Act, the commission has
91-24 exclusive original jurisdiction in all of the electric
91-25 cooperative's service area in a proceeding initiated under
91-26 Subsection (g) or (i) of this section.
91-27 (c) An electric cooperative may change its rates by:
92-1 (1) adopting a resolution approving the proposed
92-2 change;
92-3 (2) mailing notice of the proposed change to:
92-4 (A) the commission;
92-5 (B) each affected municipality;
92-6 (C) each affected customer, which notice may be
92-7 included in a monthly billing; and
92-8 (D) each electric utility providing retail
92-9 service in the electric cooperative's service area or in the
92-10 adjoining service area; and
92-11 (3) making available at each of the electric
92-12 cooperative's business offices for review by all interested persons
92-13 a cost-of-service study that:
92-14 (A) is not more than five years old at the time
92-15 the electric cooperative adopts rates under this subsection; and
92-16 (B) bears the certification of a professional
92-17 engineer or certified public accountant.
92-18 (d)(1) The notice required by Subsection (c) of this section
92-19 must contain the following information:
92-20 (A) the increase or decrease in total operating
92-21 revenues over actual test year revenues or over test year revenues
92-22 adjusted to annualize the recovery of changes in the cost of
92-23 purchased electricity, stated both as a dollar amount and as a
92-24 percentage;
92-25 (B) the classes of utility customers affected
92-26 and the creation and application of any new rate classes;
92-27 (C) the increase or decrease for each class
93-1 stated as a percentage of actual test year revenues for the class
93-2 or of test year revenues for the class adjusted to annualize the
93-3 recovery of changes in the cost of purchased electricity;
93-4 (D) a statement that the commission may review
93-5 the rate change if the commission receives a petition within 60
93-6 days in accordance with Subsection (g) of this section;
93-7 (E) the address and telephone number of the
93-8 commission;
93-9 (F) a statement that a customer opposed to the
93-10 rate change should notify the electric cooperative in writing of
93-11 the person's opposition and should provide a return address; and
93-12 (G) a statement that members may review a copy
93-13 of any written opposition the electric cooperative receives.
93-14 (2) The electric cooperative may not be required to
93-15 include additional information in the notice.
93-16 (e) The electric cooperative shall make available for review
93-17 by a member of the cooperative at each of the electric
93-18 cooperative's business offices a copy of any written opposition to
93-19 the rate change the electric cooperative receives.
93-20 (f) The electric cooperative shall file tariffs with the
93-21 commission. If the electric cooperative complies with Subsection
93-22 (c) of this section, the commission shall approve the tariffs not
93-23 later than the 10th day after the 60-day period prescribed by
93-24 Subsection (g) of this section expires, unless a review is required
93-25 under Subsection (g) or (i) of this section. If the tariffs are
93-26 approved or if a review is not required and the commission fails to
93-27 act during the period prescribed by this subsection, the change in
94-1 rates takes effect on the 70th day after the date the electric
94-2 cooperative first complies with all requirements of Subsection (c)
94-3 of this section or on a later date determined by the electric
94-4 cooperative. Except as provided by Subsections (g) and (i) of this
94-5 section, the rates of the electric cooperative are not subject to
94-6 review.
94-7 (g) The commission shall review a change in rates under this
94-8 section if, not later than the 60th day after the date the electric
94-9 cooperative first complies with all requirements of Subsection (c)
94-10 of this section, the commission receives a petition requesting
94-11 review signed by:
94-12 (1) at least 10 percent of the members of the electric
94-13 cooperative;
94-14 (2) members of the electric cooperative who purchased
94-15 more than 50 percent of the electric cooperative's annual energy
94-16 sales to a customer class in the test year, provided that the
94-17 petition includes a certification of the purchases; or
94-18 (3) an executive officer of an affected electric
94-19 utility, provided that the petition prescribes the particular class
94-20 or classes for which a review is requested.
94-21 (h) When a person files a petition under Subsection (g) of
94-22 this section, the person shall notify the electric cooperative in
94-23 writing of the action.
94-24 (i) The commission may on its own motion review the rates of
94-25 an electric cooperative if the commission first finds that there is
94-26 good cause to believe that the electric cooperative is earning more
94-27 than a reasonable return on overall system revenues or on revenue
95-1 from a rate class.
95-2 (j) The commission shall conduct a review under Subsection
95-3 (g)(1) or (2) of this section or under Subsection (i) of this
95-4 section in accordance with Section 2.212 of this Act and the other
95-5 applicable rate-setting principles of this subtitle, except that:
95-6 (1) the period for review does not begin until the
95-7 electric cooperative files a rate-filing package as required by
95-8 commission rules;
95-9 (2) the proposed change may not be suspended during
95-10 the pendency of the review; however, the electric cooperative shall
95-11 refund or credit against future bills all sums collected in excess
95-12 of the rate finally set by the commission, if the commission so
95-13 orders; and
95-14 (3) the electric cooperative shall observe the rates
95-15 set by the commission until the rates are changed as provided by
95-16 this section or by other sections of this Act.
95-17 (k) For a review conducted under Subsection (g)(3) of this
95-18 section, the electric cooperative shall file with the commission a
95-19 copy of the cost-of-service study required under Subsection (c)(3)
95-20 of this section not later than the 10th day after the date the
95-21 electric cooperative receives from the affected electric utility
95-22 notice that a petition has been filed. The commission shall
95-23 determine for each class for which review has been requested the
95-24 annual cost of providing service to the class, as stated in the
95-25 electric cooperative's cost-of-service study, and the revenues for
95-26 the class that would be produced by multiplying the rate set by the
95-27 electric cooperative by the annual billing units for the class, as
96-1 stated in the cost-of-service study. If the electric cooperative
96-2 proposes a rate class solely for a new customer, the electric
96-3 cooperative shall estimate the reasonable annual cost of providing
96-4 service to the class, and the electric cooperative shall base class
96-5 revenues on reasonable estimates of billing units.
96-6 (l) The rate for each class for which review has been
96-7 requested under Subsection (g)(3) of this section is suspended
96-8 during the pendency of the review. The commission shall dismiss
96-9 the petition and approve the rates if the revenues for the class
96-10 are equal to or greater than the cost of providing service to the
96-11 class. The commission shall disapprove the rate if the revenues
96-12 for the class are less than the cost of providing service to the
96-13 class; however, this action does not affect reconsideration of the
96-14 rate as a part of any subsequent rate-making proceeding. The rate
96-15 adopted by the electric cooperative is deemed approved and may be
96-16 placed into effect if the commission fails to make its final
96-17 determination administratively not later than the 45th day after
96-18 the date the electric cooperative files its cost-of-service study.
96-19 (m) Except as provided by Subsection (a) of this section,
96-20 the members of an electric cooperative may at any time revoke the
96-21 electric cooperative's election to be exempt from rate regulation
96-22 or elect to again be exempt from rate regulation by majority vote
96-23 of the members voting.
96-24 (n) This section does not affect the application of other
96-25 provisions of this Act not directly related to rates or to the
96-26 authority of the commission to require an electric cooperative to
96-27 file reports required under this Act or rules adopted by the
97-1 commission. A service fee or a service rule or regulation set by
97-2 the electric cooperative under this section must comply with
97-3 commission rules applicable to all electric utilities. The
97-4 commission may determine whether an electric cooperative has
97-5 unlawfully charged, collected, or received a rate for electric
97-6 utility service.
97-7 (o) A single customer may seek a review of the rates of an
97-8 electric cooperative pursuant to Section 2.211 of this Act if the
97-9 customer consumes more than 250,000,000 kwh and purchases more than
97-10 10 percent of the total energy sales or more than 7.5 percent of
97-11 the revenues of the electric cooperative in any period of 12
97-12 consecutive months within the 36 months preceding the date on which
97-13 that customer initiates a proceeding under Section 2.211 of this
97-14 Act. A right conferred by this subsection is in addition to rights
97-15 that the customer has under Subsection (g) of this section and not
97-16 in limitation or in lieu of those rights.
97-17 (p) Subsections (g)(3), (k), and (l) of this section shall
97-18 not apply to prices charged by an electric cooperative pursuant to
97-19 this section.
97-20 SECTION 2.16. Section 2.202, Public Utility Regulatory Act
97-21 of 1995, as enacted by S.B. No. 319, Acts of the 74th Legislature,
97-22 Regular Session, 1995, is amended to read as follows:
97-23 Sec. 2.202. JUST AND REASONABLE RATES. It shall be the duty
97-24 of the regulatory authority to insure that every rate made,
97-25 demanded, or received by any public utility or by any two or more
97-26 public utilities jointly shall be just and reasonable. Rates may
97-27 not be unreasonably preferential, prejudicial, or discriminatory,
98-1 but shall be sufficient, equitable, and consistent in application
98-2 to each class of consumers. Prices that are charged to individual
98-3 customers for electric service may be no higher than the rate
98-4 approved by the regulatory authority and shall be in accordance
98-5 with the provisions of Section 2.001 of this Act. For ratemaking
98-6 purposes, the commission may treat two or more municipalities
98-7 served by a public utility as a single class wherever it deems such
98-8 treatment to be appropriate.
98-9 SECTION 2.17. Subsection (b), Section 2.203, Public Utility
98-10 Regulatory Act of 1995, as enacted by S.B. No. 319, Acts of the
98-11 74th Legislature, Regular Session, 1995, is amended to read as
98-12 follows:
98-13 (b) In fixing a reasonable return on invested capital, the
98-14 regulatory authority shall consider, in addition to other
98-15 applicable factors, efforts to comply with the utility's most
98-16 recently approved individual integrated resource <statewide energy>
98-17 plan, the efforts and achievements of such utility in the
98-18 conservation of resources, the quality of the utility's services,
98-19 the efficiency of the utility's operations, and the quality of the
98-20 utility's management.
98-21 SECTION 2.18. Subsections (b) and (d), Section 2.208, Public
98-22 Utility Regulatory Act of 1995, as enacted by S.B. No. 319, Acts of
98-23 the 74th Legislature, Regular Session, 1995, are amended to read as
98-24 follows:
98-25 (b) Transactions with Affiliated Interests. Payment to
98-26 affiliated interests for costs of any services or any property,
98-27 right, or thing or for interest expense may not be allowed either
99-1 as capital cost or as expense except to the extent that the
99-2 regulatory authority shall find such payment to be reasonable and
99-3 necessary for each item or class of items as determined by the
99-4 commission. Any such finding shall include specific findings of
99-5 the reasonableness and necessity of each item or class of items
99-6 allowed and a finding that the price to the utility is no higher
99-7 than prices charged by the supplying affiliate to its other
99-8 affiliates or divisions for the same item or class of items or to
99-9 unaffiliated persons or corporations. <The price paid by gas
99-10 utilities to affiliated interests for natural gas from Outer
99-11 Continental Shelf lands shall be subject to a rebuttable
99-12 presumption that such price is reasonable if the price paid does
99-13 not exceed the price permitted by federal regulation if such gas is
99-14 regulated by any federal agency or if not regulated by a federal
99-15 agency does not exceed the price paid by nonaffiliated parties for
99-16 natural gas from Outer Continental Shelf lands. The burden of
99-17 establishing that such a price paid is not reasonable shall be on
99-18 any party challenging the reasonableness of such price.>
99-19 (d) Expenses Disallowed. The regulatory authority may not
99-20 consider for ratemaking purposes the following expenses:
99-21 (1) legislative advocacy expenses, whether made
99-22 directly or indirectly, including but not limited to legislative
99-23 advocacy expenses included in trade association dues;
99-24 (2) payments, except those made under an insurance or
99-25 risk-sharing arrangement executed before the date of loss, made to
99-26 cover costs of an accident, equipment failure, or negligence at a
99-27 utility facility owned by a person or governmental body not selling
100-1 power inside the State of Texas;
100-2 (3) costs of processing a refund or credit under
100-3 Subsection (e) of Section 2.212 of this Act; or
100-4 (4) any expenditure found by the regulatory authority
100-5 to be unreasonable, unnecessary, or not in the public interest,
100-6 including but not limited to executive salaries, advertising
100-7 expenses, legal expenses, and civil or administrative penalties or
100-8 fines.
100-9 SECTION 2.19. Section 2.211, Public Utility Regulatory Act
100-10 of 1995, as enacted by S.B. No. 319, Acts of the 74th Legislature,
100-11 Regular Session, 1995, is amended by adding Subsections (c), (d),
100-12 and (e) to read as follows:
100-13 (c) Not later than the 120th day after the date the
100-14 regulatory authority notifies the utility that the regulatory
100-15 authority has decided to proceed with an inquiry under this section
100-16 relating to the rates of the utility, the utility shall file a
100-17 rate-filing package with the regulatory authority. The regulatory
100-18 authority may grant an extension of the 120-day period or waive the
100-19 rate-filing package requirement on agreement of the parties. The
100-20 regulatory authority shall make a final determination concerning
100-21 the matter not later than the 185th day after the date the utility
100-22 files the rate-filing package. However, the 185-day period is
100-23 extended two days for each one day of actual hearing on the merits
100-24 of the case that exceeds 15 days.
100-25 (d) At any time after an initial complaint is filed under
100-26 this section, the regulatory authority may issue an interim order
100-27 fixing temporary rates for the utility that will continue until a
101-1 final determination on the matter is made. On issuance of a final
101-2 order, the regulatory authority may require the utility to refund
101-3 to customers or to credit against future bills all sums collected
101-4 during the period in which those temporary rates were in effect
101-5 that are in excess of the rate finally ordered, plus interest at
101-6 the current rate as finally determined by the commission or, if the
101-7 amounts collected during the period in which the temporary rates
101-8 were in effect are less than the amounts that would have been
101-9 collected under the rate finally ordered, the regulatory authority
101-10 shall authorize the utility to surcharge bills to recover the
101-11 difference between those amounts, plus interest on the amount of
101-12 the difference at the current rate as finally determined by the
101-13 commission.
101-14 (e) If the 185-day period has been extended as provided by
101-15 Subsection (c) of this section and the regulatory authority has not
101-16 issued a final order or fixed temporary rates on or before the
101-17 185th day, the rates charged by the utility on that 185th day
101-18 automatically become temporary rates. On issuance of a final
101-19 order, the regulatory authority shall require the utility to refund
101-20 to customers or to credit against future bills all sums collected
101-21 during the period in which those temporary rates were in effect
101-22 that are in excess of the rate finally ordered, plus interest at
101-23 the current rate as finally determined by the commission or, if the
101-24 amounts collected during the period in which the temporary rates
101-25 were in effect are less than the amounts that would have been
101-26 collected under the rate finally ordered, the regulatory authority
101-27 shall authorize the utility to surcharge bills to recover the
102-1 difference between those amounts, plus interest on the amount of
102-2 the difference at the current rate as finally determined by the
102-3 commission.
102-4 SECTION 2.20. Subsections (a), (e), and (g), Section 2.212,
102-5 Public Utility Regulatory Act of 1995, as enacted by S.B. No. 319,
102-6 Acts of the 74th Legislature, Regular Session, 1995, are amended to
102-7 read as follows:
102-8 (a) Except as provided by Section 2.105(c) of this Act, a
102-9 <A> utility may not make changes in its rates except by filing a
102-10 statement of intent with the regulatory authority having original
102-11 jurisdiction at least 35 days prior to the effective date of the
102-12 proposed change. The statement of intent shall include proposed
102-13 revisions of tariffs and schedules and a statement specifying in
102-14 detail each proposed change, the effect the proposed change is
102-15 expected to have on the revenues of the company, the classes and
102-16 numbers of utility consumers affected, and such other information
102-17 as may be required by the regulatory authority's rules and
102-18 regulations. A copy of the statement of intent shall be mailed or
102-19 delivered to the appropriate officer of each affected municipality,
102-20 and notice shall be given by publication in conspicuous form and
102-21 place of a notice to the public of such proposed change once in
102-22 each week for four successive weeks prior to the effective date of
102-23 the proposed change in a newspaper having general circulation in
102-24 each county containing territory affected by the proposed change
102-25 and by mail to such other affected persons as may be required by
102-26 the regulatory authority's rules and regulations. The regulatory
102-27 authority may waive the publication of notice requirement
103-1 prescribed by this subsection in a proceeding that involves a rate
103-2 reduction for all affected ratepayers only. The applicant shall
103-3 give notice of the proposed rate change by mail to all affected
103-4 utility customers. The regulatory authority by rule shall also
103-5 define other proceedings for which the publication of notice
103-6 requirement prescribed by this subsection may be waived on a
103-7 showing of good cause, provided that a waiver may not be granted in
103-8 any proceeding involving a rate increase to any class or category
103-9 of ratepayer.
103-10 (e) If the 150-day period has been extended, as provided for
103-11 in Subsection (d) of this section, and the commission fails to make
103-12 its final determination of rates within 150 days from the date that
103-13 the proposed change otherwise would have gone into effect, the
103-14 utility concerned may put a changed rate, not to exceed the
103-15 proposed rate, into effect throughout all areas in which the
103-16 utility sought to change its rates, including the areas over which
103-17 the commission is exercising its appellate and its original
103-18 jurisdiction, on the filing with the commission <regulatory
103-19 authority> of a bond payable to the commission <regulatory
103-20 authority> in an amount and with sureties approved by the
103-21 commission <regulatory authority> conditioned upon refund and in a
103-22 form approved by the commission <regulatory authority>. The
103-23 utility concerned shall refund or credit against future bills all
103-24 sums collected during the period of suspension in excess of the
103-25 rate finally ordered plus interest at the current rate as finally
103-26 determined by the commission <regulatory authority>.
103-27 (g)(1) Except as permitted by Section 2.051 of this Act, a
104-1 <A> rate or tariff set by the commission may not authorize a
104-2 utility to automatically adjust and pass through to its customers
104-3 changes in fuel or other costs of the utility.
104-4 (2)(A) Subdivision (1) of this subsection does not
104-5 prohibit the commission from reviewing and providing for
104-6 adjustments of a utility's fuel factor. The commission by rule
104-7 shall implement procedures that provide for the timely adjustment
104-8 of a utility's fuel factor, with or without a hearing. The
104-9 procedures shall provide that the findings required by Section
104-10 2.208(b) of this Act regarding fuel transactions with affiliated
104-11 interests are made in a fuel reconciliation proceeding or in a rate
104-12 case filed under Subsection (a) of this section or under Section
104-13 2.211 of this Act. The procedures shall provide an affected party
104-14 notice and the opportunity to request a hearing before the
104-15 commission. However, the commission may adjust a utility's fuel
104-16 factor without a hearing if the commission determines that a
104-17 hearing is not necessary. If the commission holds a hearing, the
104-18 <Any revision of a utility's billings to its customers to allow for
104-19 the recovery of additional fuel costs may be made only upon a
104-20 public hearing and order of the commission.>
104-21 <(B) The> commission may consider any evidence
104-22 that is appropriate and in the public interest at such hearing.
104-23 The commission shall render a timely decision approving,
104-24 disapproving, or modifying the adjustment to the utility's fuel
104-25 factor.
104-26 (B) The commission by rule shall provide for the
104-27 reconciliation of a utility's fuel costs on a timely basis.
105-1 (C) A proceeding under this subsection may not
105-2 be considered a rate case under this section.
105-3 (3) <The commission may, after a hearing, grant
105-4 interim relief for fuel cost increases that are the result of
105-5 unusual and emergency circumstances or conditions.>
105-6 <(4)>(A) This subsection applies only to increases or
105-7 decreases in the cost of purchased electricity which have been:
105-8 (i) accepted by a federal regulatory
105-9 authority; or
105-10 (ii) approved after a hearing by the
105-11 commission.
105-12 (B) The commission may utilize any appropriate
105-13 method to provide for the adjustment of the cost of purchased
105-14 electricity upon such terms and conditions as the commission may
105-15 determine. Such purchased electricity costs may be recovered
105-16 concurrently with the effective date of the changed costs to the
105-17 purchasing utility or as soon thereafter as is reasonably
105-18 practical.
105-19 (C) The commission may also provide for a
105-20 mechanism to allow any public utility that has a noncontiguous
105-21 geographical service area, and that purchases power for resale for
105-22 that noncontiguous service area from public utilities that are not
105-23 members of the Electric Reliability Council of Texas, to recover
105-24 purchased power cost for that area in a manner that reflects the
105-25 purchased power cost for that specific geographical noncontiguous
105-26 area. The commission may not, however, require such a mechanism
105-27 for any electric cooperative corporation unless requested by the
106-1 electric cooperative corporation.
106-2 SECTION 2.21. Section 2.214, Public Utility Regulatory Act
106-3 of 1995, as enacted by S.B. No. 319, Acts of the 74th Legislature,
106-4 Regular Session, 1995, is amended to read as follows:
106-5 Sec. 2.214. UNREASONABLE PREFERENCE OR PREJUDICE AS TO RATES
106-6 OR SERVICES. A public utility may not, as to rates or services,
106-7 make or grant any unreasonable preference or advantage to any
106-8 corporation or person within any classification or subject any
106-9 corporation or person within any classification to any unreasonable
106-10 prejudice or disadvantage. A public utility may not establish and
106-11 maintain any unreasonable differences as to rates of service either
106-12 as between localities or as between classes of service. Prices
106-13 that are charged to individual customers for retail or wholesale
106-14 electric service that are less than the rate approved by the
106-15 regulatory authority shall not constitute an impermissible
106-16 difference, preference, or advantage if such lesser prices are in
106-17 accordance with Section 2.052.
106-18 SECTION 2.22. Subtitle E, Title II, Public Utility
106-19 Regulatory Act of 1995, as enacted by S.B. No. 319, Acts of the
106-20 74th Legislature, Regular Session, 1995, is amended by adding
106-21 Section 2.2141 to read as follows:
106-22 Sec. 2.2141. DISCOUNTED RATES FOR CERTAIN STATE INSTITUTIONS
106-23 OF HIGHER EDUCATION. Notwithstanding any other provision of this
106-24 Act, each public utility and municipally owned utility shall
106-25 discount charges for electric service provided to any facility of
106-26 any four-year state university, upper-level institution, or
106-27 college. The discount shall be a 20 percent reduction of the
107-1 utility's base rates that otherwise would be rendered under the
107-2 applicable tariffed rate. However, if a 20 percent discount
107-3 results in a reduction greater than one percent of the public or
107-4 municipally owned utility's total annual revenues or if the
107-5 municipally owned utility, as of September 1, 1995, discounts base
107-6 commercial rates for electric service provided to all four-year
107-7 state universities or colleges in its service area by 20 percent or
107-8 more, the utility shall be exempt from the provisions of this
107-9 section. Each public utility shall file tariffs with the
107-10 commission reflecting the discount within 30 days of the effective
107-11 date of this section. Such initial tariff filing shall not be
107-12 considered a rate change for purposes of Section 2.212 of this Act.
107-13 This section does not apply to rates charged to a state institution
107-14 of higher education by a municipally owned utility which provides a
107-15 discounted rate to the state for electric services below rates in
107-16 effect on January 1, 1995, and which discounted rates provide a
107-17 greater financial discount to the state than is provided to the
107-18 state institution of higher education through the discount provided
107-19 by this section. An investor-owned public utility may not recover
107-20 the assigned and allocated costs of serving a state university or
107-21 college which receives a discount under this section from
107-22 residential customers or any other customer class.
107-23 SECTION 2.23. Section 2.215, Public Utility Regulatory Act
107-24 of 1995, as enacted by S.B. No. 319, Acts of the 74th Legislature,
107-25 Regular Session, 1995, is amended by amending Subsection (a) and by
107-26 adding Subsection (c) to read as follows:
107-27 (a) A public utility may not, directly or indirectly, by any
108-1 device whatsoever or in any manner, charge, demand, collect, or
108-2 receive from any person a greater or less compensation for any
108-3 service rendered or to be rendered by the utility than that
108-4 prescribed in the schedule of rates of the public utility
108-5 applicable thereto when filed in the manner provided in this Act,
108-6 nor may any person knowingly receive or accept any service from a
108-7 public utility for a compensation greater or less than that
108-8 prescribed in the schedules provided that it is lawful for a
108-9 utility to charge individual customers a price for retail or
108-10 wholesale electric service that is less than the rate approved by
108-11 the regulatory authority and for a person to pay such lesser price
108-12 if such lesser price is in accordance with Section 2.052.
108-13 (c) Notwithstanding any other provision of this Act, when
108-14 the commission has approved the establishment of a separate rate
108-15 class for electric service for a university and has grouped public
108-16 schools in a separate rate class, the commission shall include
108-17 community colleges in the rate class with public school customers.
108-18 SECTION 2.24. Section 2.251, Public Utility Regulatory Act
108-19 of 1995, as enacted by S.B. No. 319, Acts of the 74th Legislature,
108-20 Regular Session, 1995, is amended to read as follows:
108-21 Sec. 2.251. DEFINITION. For the purposes of this subtitle
108-22 only, "retail public utility" means any person, corporation,
108-23 municipality, political subdivision or agency, or cooperative
108-24 corporation, now or hereafter operating, maintaining, or
108-25 controlling in Texas facilities for providing retail public utility
108-26 service, except that a qualifying cogenerator selling electric
108-27 energy at retail to the sole purchaser of the cogenerator's thermal
109-1 output pursuant to Section 2.052 of this Act shall not be
109-2 considered a retail public utility.
109-3 SECTION 2.25. Subsections (d), (e), and (f), Section 2.255,
109-4 Public Utility Regulatory Act of 1995, as enacted by S.B. No. 319,
109-5 Acts of the 74th Legislature, Regular Session, 1995, are amended to
109-6 read as follows:
109-7 (d) This section does not apply to a certificate of
109-8 convenience and necessity for an electric generating plant that is
109-9 requested under Section 2.051 of this Act. The commission may
109-10 grant a certificate of convenience and necessity for an electric
109-11 generating plant only in accordance with Section 2.051 of this Act.
109-12 (e) <(1) In addition to the requirements of this section, an
109-13 electric utility applying for a certificate of convenience and
109-14 necessity for a new generating plant must first file a notice of
109-15 intent to file an application for certification.>
109-16 <(2) The notice of intent shall set out alternative
109-17 methods considered to help meet the electrical needs, related
109-18 electrical facilities, and the advantages and disadvantages of the
109-19 alternatives. In addition, the notice shall indicate compatibility
109-20 with the most recent long-term forecast provided in this Act.>
109-21 <(3) The commission shall conduct a hearing on the
109-22 notice of intent to determine the appropriateness of the proposed
109-23 generating plant as compared to the alternatives and shall issue a
109-24 report on its findings. In conjunction with the issuance of the
109-25 report, the commission shall render a decision approving or
109-26 disapproving the notice. Such decision shall be rendered within
109-27 180 days from the date of filing the notice of intent.>
110-1 <(e)(1) On approval of the notice of intent, a utility may
110-2 apply for certification for a generating plant, site, and site
110-3 facilities not later than 12 months before construction is to
110-4 commence.>
110-5 <(2) The application for certification shall contain
110-6 such information as the commission may require to justify the
110-7 proposed generating plant, site, and site facilities and to allow a
110-8 determination showing compatibility with the most recent forecast.>
110-9 <(3) Certificates of convenience and necessity shall
110-10 be granted on a nondiscriminatory basis if the commission finds
110-11 that the proposed new plant is required under the service area
110-12 forecast, that it is the best and most economical choice of
110-13 technology for that service area as compatible with the
110-14 commission's forecast, and that conservation and alternative energy
110-15 sources cannot meet the need.>
110-16 <(f)> If the application for a certificate of convenience
110-17 and necessity involves new transmission facilities, the commission
110-18 shall approve or deny the application within one year after the
110-19 date the application is filed. If the commission does not approve
110-20 or deny the application before this deadline, any party may seek a
110-21 writ of mandamus in a district court of Travis County to compel the
110-22 commission to make a decision on the application.
110-23 SECTION 2.26. Section 2302.043, Government Code, is amended
110-24 to read as follows:
110-25 Sec. 2302.043. Order or Ruling. (a) A commission order or
110-26 ruling entered under this chapter is considered to have been
110-27 entered or adopted under the Public Utility Regulatory Act of 1995
111-1 <(Article 1446c, Vernon's Texas Civil Statutes)>.
111-2 (b) A commission order or ruling entered under this chapter
111-3 is enforced under Subtitle I, Title I, <Sections 71 through 77 of
111-4 the> Public Utility Regulatory Act of 1995 <(Article 1446c,
111-5 Vernon's Texas Civil Statutes)>.
111-6 SECTION 2.27. Chapter 166, Acts of the 63rd Legislature,
111-7 Regular Session, 1973 (Article 1435a, Vernon's Texas Civil
111-8 Statutes), is amended by adding Section 4c to read as follows:
111-9 Sec. 4c. (a) Subject to the approval of the Public Utility
111-10 Commission of Texas, an electric cooperative corporation may form a
111-11 joint powers agency with one or more public entities and
111-12 participate in an existing joint powers agency in which at least
111-13 one public entity is a member and participant, as if the electric
111-14 cooperative corporation were a public entity.
111-15 (b) The Public Utility Commission of Texas shall approve
111-16 participation by an electric cooperative corporation under this
111-17 section if the commission determines that the participation meets
111-18 the requirements of law.
111-19 (c) A joint powers agency in which an electric cooperative
111-20 corporation participates under this section is a governmental body
111-21 subject to Chapter 551, Government Code.
111-22 (d) This section may not be construed to authorize or
111-23 entitle an electric cooperative corporation to issue bonds or other
111-24 securities that are exempt from taxation under federal law.
111-25 SECTION 2.28. Section 4A, Electric Cooperative Corporation
111-26 Act (Article 1528b, Vernon's Texas Civil Statutes), is amended to
111-27 read as follows:
112-1 Sec. 4A. Additional Powers. Notwithstanding any other
112-2 provision of this Act, a corporation has authority to generate,
112-3 manufacture, purchase, acquire, and accumulate electric energy and
112-4 to transmit, distribute, sell, furnish, and dispose of such
112-5 electric energy to the following entities if the same are engaged
112-6 in the generation, <and> transmission, or distribution of
112-7 electricity <for resale>:
112-8 (1) firms, associations, corporations, except those
112-9 who meet the criteria for a small power production facility and/or
112-10 a cogeneration facility under Section 201 of the Public Utility
112-11 Regulatory Policies Act of 1978 (PURPA);
112-12 (2) federal agency;
112-13 (3) state or political subdivision of a state <with an
112-14 installed generation capacity in excess of 500 MW>; or
112-15 (4) a municipal power agency or political subdivision
112-16 of a state which is a co-owner with such corporation of a jointly
112-17 owned electric generation facility.
112-18 <A corporation may also sell, furnish, and dispose of the
112-19 electric energy to a political subdivision of the state which is
112-20 engaged in the generation, transmission, or distribution of
112-21 electricity for resale and to which the corporation was selling and
112-22 furnishing electric energy on December 31, 1982.>
112-23 The members-only requirement of Section 4(4) of this Act
112-24 shall continue to apply to all sales by a corporation to other
112-25 persons and entities.
112-26 SECTION 2.29. Section 171.079, Tax Code, is amended to read
112-27 as follows:
113-1 Sec. 171.079. EXEMPTION--ELECTRIC COOPERATIVE CORPORATION.
113-2 An electric cooperative corporation incorporated under the Electric
113-3 Cooperative Corporation Act (Article 1528b, Vernon's Texas Civil
113-4 Statutes) that is not a participant in a joint powers agency is
113-5 exempted from the franchise tax.
113-6 SECTION 2.30. (a) The Public Utility Commission of Texas by
113-7 rule shall adopt a statewide integrated resource planning process
113-8 as required by Section 2.051, Public Utility Regulatory Act of
113-9 1995, as enacted by S.B. No. 319, Acts of the 74th Legislature,
113-10 Regular Session, 1995, and as amended by this Act, not later than
113-11 September 1, 1996.
113-12 (b) The changes in law made by this Act to Section 2.255,
113-13 Public Utility Regulatory Act of 1995, as enacted by S.B. No. 319,
113-14 Acts of the 74th Legislature, Regular Session, 1995, take effect
113-15 September 1, 1996, and apply only to an application for a
113-16 certificate of convenience and necessity filed on or after that
113-17 date, except that, in the case of a utility for which the
113-18 commission has not yet approved an individual integrated resource
113-19 plan as of September 1, 1996, an application for a certificate of
113-20 convenience and necessity is governed by the law in effect
113-21 immediately preceding the effective date of this Act until the
113-22 commission approves an integrated resource plan for the utility.
113-23 SECTION 2.31. The Public Utility Commission of Texas shall
113-24 adopt the initial rules required by Section 2.057, Public Utility
113-25 Regulatory Act of 1995, as added by this Act, not later than the
113-26 180th day after the effective date of this Act.
113-27 SECTION 2.32. An exempt wholesale generator or power
114-1 marketer required to register under Subsection (c), Section 2.053,
114-2 Public Utility Regulatory Act of 1995, as added by this Act, shall
114-3 register not later than the 90th day after the effective date of
114-4 this Act.
114-5 SECTION 2.33. Except as otherwise provided by this Act, this
114-6 Act takes effect September 1, 1995.
114-7 SECTION 2.34. The importance of this legislation and the
114-8 crowded condition of the calendars in both houses create an
114-9 emergency and an imperative public necessity that the
114-10 constitutional rule requiring bills to be read on three several
114-11 days in each house be suspended, and this rule is hereby suspended,
114-12 and that this Act take effect and be in force according to its
114-13 terms, and it is so enacted.