IMF H.B. 2148 75(R)BILL ANALYSIS STATE AFFAIRS H.B. 2148 By: Longoria 5-9-97 Committee Report (Unamended) BACKGROUND Energy service companies (ESCO's) provide energy efficiency related services to customers in their homes and businesses. Many utilities have utility affiliates that provide energy efficiency and demand management services and technology ranging from weatherization to motion sensitive light switches to complete building renovations. Current law allows utility companies to select which companies it will use to provide these services to its customers, and may be naturally inclined to favor their own affiliates. PURPOSE As proposed, H.B. 2148 would require the Public Utility Commission to regulate electric companies to ensure that their affiliates, partners, or ventures do not gain an unfair advantage over independent companies that provide energy efficiency services. The bill would also require the Public Utility Commission to adopt rules that: allow a customer to choose any energy efficiency provider or technology; allow a energy efficiency provider to choose what services it will offer; and promote a competitive market for energy efficiency services. RULEMAKING AUTHORITY It is the committee's opinion that this bill grants rulemaking authority to the Public Utility Commission in SECTION 1 (Sec. 2.216 PURA 1995, Art. 1446c-o, V.T.C.S.) of this Act. SECTION BY SECTION ANALYSIS SECTION 1. Amends Section 2.216 of the Public Utility Regulatory Act of 1995 (Article 1446c-0, V.T.C.S. by adding Subsections (b) and (c) as follows: Section 2.216 (b) requires the Public Utility Commission to monitor and regulate the relationships between utilities and their affiliates, partners, or ventures to ensure that they do not garner an unfair advantage over competitors in the energy efficiency market. Section 2.216 (c) requires the Public Utility Commission to adopt rules that ensure that utility companies with energy efficiency incentive program's financed by rate payments allow: customer choice of provider of energy efficiency services; energy efficiency companies to determine their own products or services; and full competition in the energy efficiency market. SECTION 2. Requires the Public Utility Commission to adopt rules necessary to carry out this Act by December 31, 1997. SECTION 3. Emergency clause. Effective date: upon passage.