SRC-MAX S.B. 1571 75(R)   BILL ANALYSIS


Senate Research Center   S.B. 1571
By: Madla
State Affairs
4-18-97
As Filed


DIGEST 

Wholesale competition was introduced in the electric utility industry by
the passage of S.B. 373 during the 74th Legislature.  During the
rulemaking proceeding at the Public Utility Commission of Texas (PUC), PUC
adopted substantive rules to implement pricing of transmission service as
required by the statute.  There are concerns that these rules create
disproportionate and inequitable shifting of cost among electric
transmission providers in this state.  This bill sets forth requirements
relating to transmission pricing methodology for wholesale wheeling.   

PURPOSE

As proposed, S.B. 1571 sets forth requirements for transmission pricing
methodology for wheeling in the electric utility industry.  

RULEMAKING AUTHORITY

This bill does not grant any additional rulemaking authority to a state
officer, institution, or agency. 

SECTION BY SECTION ANALYSIS

SECTION 1. Amends Section 2.057(c), Article 1446c-0, V.T.C.S.  (Public
Utility Regulatory Act of 1995), to require the Public Utility Commission
(PUC) to ensure that prices for transmission use do not result in a
disproportionate shifting of cost responsibility among Electric
Reliability Council of Texas transmission system, when measured by a
utility's use of transmission facilities owned by others in comparison to
others' use of its transmission system. 

SECTION 2. Amends Section 2.105, Article 1446c-0, V.T.C.S., to require PUC
to apply ratemaking principles based on the flow of funds set forth in the
municipality's revenue bond ordinance and other debt ordinances to allow
for a cash flow level sufficient to cover all items required to be paid
from certain sources under certain conditions.  Prohibits PUC from
considering certain factors applicable to investor-owned utilities.
Requires PUC to specifically acknowledge that provisions contained in
certain sections of this Act do not apply to municipally owned utilities. 

SECTION 3. Effective date:  September 1, 1997.

SECTION 4. Emergency clause.