HBA-RAR H.B. 349 76(R) BILL ANALYSIS Office of House Bill AnalysisH.B. 349 By: Wolens State Affairs 2/10/1999 Introduced BACKGROUND AND PURPOSE Currently, the retail electric utility market in Texas is a regulated industry. In 1995, the legislature deregulated the electric wholesale power market by creating open access transmission. H.B. 349 outlines and offers a further transition from a regulated market to one of competition in the retail sale of electricity by requiring the introduction of retail competition by January 1, 2002, in an area served by electric utilities not interconnected with electric utilities outside of the state; and authorizing the Public Utility Commission of Texas (PUC) to determine the date of the introduction of retail competition in other regions, if the necessary institutions and procedures are in place. It offers an exception to the introduction of retail competition for areas served by a cooperative or municipally owned utility and authorizes the members of the cooperative or the residents of the municipality to elect the introduction of retail competition by majority vote. Under H.B. 349, utilities could recover stranded costs through existing rates or by imposing an access charge. This bill requires the payment of property taxes over the life of the assets with a reduction in taxable value for depreciation only. It establishes a market structure and the organizations deemed essential for retail competition and places a 20 percent limitation in ownership of installed capacity in certain geographic areas determined by PUC, setting forth an approval process for mergers and consolidations. H.B. 349 requires the licensing of retail electric providers and the registration of wholesale power sellers. It also establishes planning goals for renewable energy technologies and sets forth customer protection standards. RULEMAKING AUTHORITY It is the opinion of the Office of House Bill Analysis that rulemaking authority is expressly delegated to the Public Utility Commission of Texas in SECTION 3 (Sections 39.001, 39.051, 39.054, 39.101, 39.103, 39.172, 39.173, and 39.202, Utilities Code) of this bill. SECTION BY SECTION ANALYSIS SECTION 1. Amends Section 31.001, Subtitle B, Title 2, Utilities Code, as follows: Sec. 31.001. LEGISLATIVE FINDINGS; PURPOSE OF SUBTITLE. Sets forth legislative findings and the purpose of this subtitle. Creates new Subsections (a)-(c) and deletes existing Subsections (a)-(c). SECTION 2. Amends Section 31.002, Subtitle B, Title 2, Utilities Code, as follows: Sec. 31.002. DEFINITIONS. Defines "Electric Reliability Council of Texas" or "ERCOT," "fallback retail electric provider," "Renewable Energy Technology," "retail electric provider," and "wholesale power seller." Excludes a retail electric provider and a wholesale power seller from the definition of electric utility. Makes necessary redesignations of subsections and subdivisions. SECTION 3. Amends Subtitle B, Title 2, Utilities Code, by adding Chapter 39, as follows: CHAPTER 39. RETAIL ELECTRIC COMPETITION SUBCHAPTER A. INTRODUCTION OF RETAIL COMPETITION Sec. 39.001. INTRODUCTION OF RETAIL ELECTRIC COMPETITION. Requires that competition be introduced in the retail sale of electricity and that customers have the right to choose their provider. Requires that competition be consistent with reliable service, competition among producers and sellers, and continued regulation of transmission and distribution. Requires the Public Utility Commission of Texas (PUC) to coordinate the activities of persons engaged in the sale of electricity to ensure that the institutions and procedures necessary to introduce retail competition are created and are able to operate in a timely and efficient manner, and to adopt the necessary or appropriate rules to carry out this chapter. Sec. 39.002. DATE OF INTRODUCTION OF RETAIL COMPETITION IN ERCOT. Requires retail competition to begin on January 1, 2002, if the necessary institutions and procedures are in place. Authorizes PUC to delay the beginning of retail competition if these conditions are not met. Sec. 39.003. DATE OF INTRODUCTION OF RETAIL COMPETITION IN REGIONS OTHER THAN ERCOT. Requires retail competition to begin on a date determined by PUC if it determines that concentration in generation market meets the requirements of this Chapter, transmission service and rates for the region are conducive to competition, and the appropriate institutions and procedures are in place. Sec. 39.004. LIMITATION ON COMPETITIVE MARKETS FOR AREAS SERVED BY COOPERATIVES AND MUNICIPAL UTILITIES. (a) Excludes from the introduction of retail competition an area where the exclusive provider is an electric cooperative or a municipally owned utility on the date of enactment of this Act. (b) Authorizes a majority of the voting members of a cooperative or the residents of a municipality served by a municipally owned utility to elect the introduction of retail competition in the area. (c) Requires that the election be irrevocable, be filed with PUC, and be effective at a date determined by the cooperative or the municipally owned utility. (d) Provides that any code of conduct adopted under Section 39.103 applies to a cooperative or municipally owned utility that elects introducing retail competition. (e) Provides that the area where the exclusive provider is an electric cooperative or a municipally owned utility will be subject to retail competition if these utilities are also retail providers in an area outside their certificated service territory within a region where retail competition has been introduced. Sec. 39.005. STRANDED COST POLICY STATEMENT. Provides that it is in the public interest to allow recovery of reasonable excess costs over the market value of uneconomic generation related assets and purchased power contracts by utilities with such assets and contracts, and to allow customers to continue to benefit from those utilities with costs below market value. Sec. 39.006. ELIGIBILITY TO RECOVER STRANDED COSTS. Provides for recovery of stranded costs only if PUC finds that the utility had potentially stranded costs since September 1, 1997. Sec. 39.007. RECOVERY OF STRANDED COSTS THROUGH EXISTING RATES. (a) Authorizes a utility subject to PUC's jurisdiction to elect, no later than October 1, 1999, to recover stranded costs through its existing rates. Provides that the utility that makes such an election is not subject to rate review until January 1, 2002, and prohibits the utility from filing for a rate increase. Provides for an adjustment of rates by PUC if competition has not begun in the region served by January 1, 2002. Requires PUC, while setting rates, to value generation related assets at the lesser of market value or net book value reduced by excess earnings. (b) Prohibits a utility making the election from otherwise requesting stranded cost recovery. (c) Authorizes the utility making the election to use any profits earned during the election period to recover stranded costs. (d) Authorizes the utility making the election to file with the regulatory authority for approval of new services, discounted rates, or for a reduction of an existing tariff. (e) Requires the utility making the election to be subject to PUC regulatory authority over fuel costs and charges and power cost recovery factors. (f) Requires the utility making the election to continue to pay property taxes over the life of its assets and authorizes a reduction in value for straight line depreciation only. Provides that the obligation to pay property taxes survives the transfer or sale of such assets. Sec. 39.008. RECOVERY OF STRANDED COSTS BY ACCESS CHARGE. (a) Authorizes a utility that does not elect to recover stranded costs through existing rates to apply for cost recovery under this section no later than October 1, 1999. (b) Requires the utility to file with the appropriate regulatory authority tariffs reducing base rates of residential and small commercial customers by 12 percent and all other rate classes, except for non-firm or curtailable service, by four percent as compared to base rates in effect January 1, 1996. Requires that the tariffs be effective on November 1, 1999, even if it is necessary to hold hearings or require refiling of the tariffs. Defines base rates and authorizes the regulatory authority to make further adjustments to prevent excessive earnings. (c) Authorizes the utility to quantify its stranded costs by a market valuation or by an administrative method. (1) Sets forth the market value method. (2) Sets forth the administrative method. (3) Requires that stranded costs be the reasonable net excess cost over the market value of the generation related assets and purchased power contracts entered into before January 1, 1995, nuclear decommissioning costs, and eligible costs associated with improved air quality as provided by Section 39.010. Requires that the value of incumbency be used to offset stranded costs. Sets forth the dates of quantification for the market value method and the administrative method. Provides for the inclusion in the quantification of expected property taxes due on the excess of the cost over the balance of the life of the assets. (4) Requires the utility to submit to PUC a request for approval of the quantification of its stranded costs and proposed access charges. Requires PUC to set a schedule for the filing of requests, to determine the level of the utility's stranded costs, and to authorize the recovery of such costs. (d) Requires PUC to authorize the recovery of stranded costs by imposing an access charge on a retail service provider for the use of the electric utility's distribution and transmission system. (1) Requires PUC to calculate the access charge for recovering, in a period of 15 years or less, 100 percent of the stranded costs under the market value method or 75 percent of the costs under the administrative method. Authorizes PUC to adjust the access charge to ensure that the recovery does not exceed the allowed stranded costs, and prohibits adjusting the previous quantification of allowed stranded costs. Requires a fair allocation of stranded investment costs among customer classes in a manner that is not preferential, discriminatory, or anticompetitive. (2) Requires the unrecovered balance of stranded costs to earn a seven percent return on equity for the administrative method, or the weighted cost of capital as determined by PUC for the market valuation method. (3) Requires the utility on expiration of the access charge to file with PUC a reconciliation of access charges collected and the amount of stranded investment determined by PUC to be eligible for recovery. Requires PUC to order a refund of excess collections plus interests if PUC determines that the utility collected charges in excess of the stranded and carrying costs. Prohibits the utility from seeking recovery of stranded costs not collected through the access charge. (4) Requires the utility to continue to pay property taxes over the life of its assets associated with stranded costs, and authorizes a reduction in value for straight line depreciation only. Sec. 39.009. FLOW THROUGH OF BELOW MARKET COSTS. (a) Authorizes PUC to require a flow through to the utility customers of 75 percent of the benefit of below market value generation related assets and purchased power costs. Requires PUC to flow through the benefit by imposing a negative access charge on the customers of the utility's distribution and transmission system. (b) Requires PUC to set the access charges to recover the below market costs over a period of 15 years or less. Authorizes PUC to use means consistent with quantification of stranded costs to determine the amount of the benefit to pass to customers. Authorizes PUC to adjust the negative access charges to ensure that the benefit passed to customers is not more or less than the amount below market of the utility's generation assets and purchased power contracts. Prohibits PUC from adjusting the previous quantification of stranded costs. Requires a fair allocation of the benefits of the below market costs among customer classes in a manner that is not preferential, discriminatory, or anticompetitive. (c) Requires the utility on the expiration of the negative access charge to file with PUC a reconciliation of negative access charges collected and the amount of benefit of below market value costs determined by PUC. Requires a refund or surcharge of any difference between the amount of negative charges flowed through to customers and the amount of the benefit of below market costs. Sec. 39.010. STRANDED COSTS RELATED TO AIR QUALITY. Provides that a cost incurred before January 1, 2001, to improve air quality is eligible for stranded cost recovery if the cost is applied to retrofit electric generation facilities that have not obtained air quality authorization pursuant to 30 T.A.C. Chapter 116 (Control of Air Pollution by Permits for New Construction or Modification), and if the utility demonstrates that the cost is more economical than retirement of the generating facility. Excludes from recovery any cost to achieve emission reductions that exceed federal or state standards that is not included in the existing rates in effect on January 1, 1998. Sec. 39.011. FEDERAL INCOME TAXES. Authorizes PUC to enter orders that are necessary and in the public interest regarding potential income tax liability of entities participating in the electric service market in Texas resulting from the restructuring of the industry or changes in federal tax law. Requires PUC to consider the federal tax burden on electric utilities and their customers and the effect of such tax burden on competition. SUBCHAPTER B. MARKET STRUCTURE Sec. 39.051. ESSENTIAL ORGANIZATIONS. (a) Sets forth that establishing independent organizations to perform specified functions is deemed essential to permit retail competition. (b) Defines "independent organization." (c) Requires PUC to determine the appropriate regions for the independent organizations and to certify the organization or organizations to perform the functions of this section. (d) Authorizes an independent organization certified by PUC to establish and enforce procedures, consistent with this Act and PUC's rules, relating to the reliability of the regional electrical network and accounting for the production and delivery of electricity among generators and wholesale buyers and sellers. Requires the rules to be subject to PUC oversight and review. (e) Provides that PUC may authorize a certified independent organization to charge a reasonable rate to wholesale buyers and sellers to cover the independent organization's costs. (f) Authorizes PUC to cooperate with the regulatory commission of another state or the federal government and to hold a joint hearing or make a joint investigation. (g) Provides that the existing independent system operator in ERCOT will meet the certification criteria by amending its governance rules to allow representation reflecting the make-up of the retail market on its governing board. Requires PUC to determine the certification of the ERCOT independent system operator. Sec. 39.052. OBLIGATIONS OF ELECTRIC UTILITIES. Requires an electric utility or municipally owned utility that owns or operates transmission or distribution facilities in an area where retail competition has been introduced to provide transmission or distribution service on a non-discriminatory basis. Provides that in an area where retail competition has been introduced an electric utility is responsible for obtaining a franchise agreement from each municipality in which it has distribution facilities. Prohibits municipalities from requiring retail electric providers to obtain franchise agreements except to the extent that the retail electric provider may own facilities on the streets, alleys, or right of ways within a municipality. Sec. 39.053. METERING. Requires the electric utility to retain the function of metering usage to the retail customers in its certified territory for a period of two years after the introduction of competition and requires metering to become a competitive service at the end of such period. Authorizes a retail electric provider to provide additional or enhanced metering devices on the customer's premises with the permission of the retail customer. Sec. 39.054. REGULATION OF ELECTRIC UTILITIES. (a) Prohibits an electric utility from selling electric service to customers or from owning facilities for generation of electricity after the introduction of retail competition. (b) Requires every electric utility to maintain accurate records for billing transmission and distribution services. Requires PUC to adopt rules and oversee the development of systems governing notification and recording of changes in the retail electric provider, maintenance of accurate records of the retail electric provider servicing each retail customer, and maintenance of accurate records of the electric utility providing distribution service in each area of the state where retail competition is in effect. Sec. 39.055. RETAIL ELECTRIC PROVIDER. (a) Authorizes a retail electric provider to provide electricity to any customer in Texas in an area where retail competition has been introduced. (b) Authorizes a person who owns electric generation facilities to sell electric service at retail only by becoming a licensed retail electric provider. (c) Requires a retail electric customer who does not affirmatively select a retail electric provider, to be served by the retail electric provider that is affiliated with or the successor in interest of the electric utility serving that customer on the day immediately prior to the introduction of retail competition; otherwise, to be served by the fallback retail electric provider designated under Section 39.056. Requires that the right of the retail electric provider to serve customers who do not choose a retail electric provider be considered in determining the value of incumbency under Section 39.008. Sec. 39.056. FALLBACK RETAIL ELECTRIC PROVIDER. (a) Requires PUC to designate fallback retail electric providers in areas of the state where retail competition is in effect. (b) Requires the fallback retail electric provider to offer a standard retail service package for each class of customers designated by PUC at a fixed, non-discountable rate approved by PUC. (c) Requires the fallback retail electric provider to provide the standard retail service package to any requesting customer in the territory for which it is the fallback retail electric provider. (d) Requires PUC to designate the fallback retail electric provider or providers by June 1, 2001, for areas in which retail competition is introduced on January 1, 2002; otherwise, at the earliest feasible date that is at least six months before the beginning of retail competition in other areas. Requires PUC to determine the procedures and criteria, including solicitation of bids, for designation of a fallback retail electric provider or providers. Authorizes PUC to redesignate the fallback retail electric provider according to a schedule it deems appropriate. (e) Authorizes PUC to require a retail electric provider to become the fallback retail electric provider for a given area of the state as a condition of receiving or maintaining a license according to Section 39.121, if no retail provider applies to be the fallback provider for a given area on reasonable terms and conditions. (f) Requires the fallback retail electric provider, if a retail provider fails to serve any or all of its customers, to offer the standard retail service package to any such customer without interruption of service to any customer. SUBCHAPTER C. MARKET POWER Sec. 39.101. COMMISSION ASSESSMENT OF MARKET POWER. (a) Requires each person, municipally owned utility, and river authority that owns generation facilities and offers electricity for sale in this state, to report to PUC its installed generation capacity, the total amount of capacity available for sale to others, the total amount of capacity under contract to others, the total amount of capacity dedicated to its own use, its annual power sales in the state, its annual retail power sales in the state, and any other information necessary for PUC to assess market power or the development of a competitive retail market in Texas. Requires PUC to prescribe, by rule, the nature and detail of such reporting requirements. (b) Requires the ERCOT independent system operator to submit an annual report to PUC identifying existing and potential transmission and distribution constraints, systems needs, alternatives for meeting system needs, and recommendations for meeting system needs. Requires the first report to be submitted by October 1, 1999, and subsequent reports by January 15 of each year or as determined by PUC. (c) Requires electric utilities owning transmission and distribution facilities outside of ERCOT to report to PUC existing and potential transmission and distribution constraints, system needs, alternatives for meeting system needs, and recommendations for meeting system needs as directed by PUC. (d) Requires PUC to determine the geographic markets for assessing market power in Texas by January 31, 2000, and to make subsequent determinations as necessary to implement Section 39.102. (e) Requires PUC to consider whether the available transmission facilities limit the delivery of electricity from remote generators when determining the boundaries of geographic markets. (f) Provides that ERCOT is the geographic market for electric utilities operating within its boundaries, unless PUC determines that specific transmission, distribution, or other constraints exist for a geographic area within ERCOT such that returns in excess of reasonable cost of capital may be earned in the long-run without inducing entry of additional competitors in the specific geographic area. Requires PUC to determine the appropriate geographic market for an electric utility operating within ERCOT after such a finding. Sec. 39.102. LIMITATION OF OWNERSHIP OF INSTALLED CAPACITY. (a) Requires PUC to determine the amount of installed capacity available for sale to others in each geographic market. Prohibits any person from owning, operating, or controlling more than 20 percent of the installed generation capacity in each geographic market upon or after the introduction of retail competition under Section 39.002 or 39.003. (b) Requires that the capacity owned by a person and an affiliated entity be combined in determining the shares of generation capacity. (c) Requires PUC to establish a schedule for each electric utility operating within ERCOT and owning more than 20 percent of the installed capacity to submit a plan to comply with this section by December 31, 2001. (d) Requires PUC to establish a schedule for each utility operating outside the geographical boundaries of ERCOT and owning more than 20 percent of the installed capacity to submit a plan to comply with this section after PUC has determined that the conditions necessary for competition in Section 39.001 exist in the geographical market. (e) Requires PUC to approve, modify, or reject each plan as necessary within 180 days of the submission for approval. Requires PUC in reaching a determination to consider the degree to which the utility's stranded costs are minimized, whether the reasonable value is likely to be received on disposition of generation assets, the effect of the plan on the utility's federal income tax, the effect on the environment, the effect on current and potential competitors, and whether the plan is consistent with the public interest. Sec. 39.103. COMMISSION AUTHORITY TO ADDRESS MARKET POWER. (a) Requires PUC to monitor market power associated with the generation, transmission, distribution, and sale of electricity in this state. Requires PUC, upon a finding of market power abuse, after notice and opportunity for hearing, to request reasonable mitigation of the market power by ordering the construction of additional transmission or distribution facilities; by instituting price cap regulation; by setting appropriate restrictions on sales of electricity; by establishing limitations on the use of generation, transmission, or distribution facilities; or by any reasonable remedy, excluding mandatory divestiture or other required sale of assets. (b) Prohibits a person, municipally owned utility, or river authority that owns generation facilities from owning transmission or distribution facilities in this state except for those necessary to interconnect a generation facility with the transmission or distribution network. Authorizes an affiliate of an electric utility to own generation facilities. (c) Requires PUC to adopt rules to govern transactions or activities between an electric utility and its affiliates. Sec. 39.104. MERGERS AND CONSOLIDATIONS. (a) Requires any owner of electric generation that offers electricity for sale in this state and proposes to merge, consolidate, or otherwise become affiliated with any other owner of electric generation that offers electricity for sale in this state to obtain PUC's approval prior to closing. Requires that such request for approval be filed at least 120 days prior to closing. Requires PUC to approve the transaction unless it finds that the transaction is inconsistent with the public interest or state or federal antitrust laws. Authorizes PUC to grant conditional approval upon adoption of reasonable modifications to the transaction as determined by PUC to mitigate market power abuses, if PUC finds that the transaction is inconsistent with the public interest. (b) Requires any retail electric provider that proposes to merge, consolidate, or otherwise become affiliated with any other retail electric provider in this state to obtain PUC's approval prior to closing. Requires that such request for approval be done at least 120 days prior to closing. Requires PUC to approve the transaction unless it finds that the transaction is inconsistent with the public interest or state or federal antitrust laws, or that the merged entity fails to satisfy Section 39.121. Authorizes PUC to grant conditional approval upon adoption of reasonable modifications to the transaction as determined by PUC to mitigate market power abuses, if PUC finds that the transaction is inconsistent with the public interest. (c) Provides that this section does not confer immunity from state or federal antitrust laws, and is intended to complement other state and federal antitrust provisions. Authorizes seeking antitrust remedies for anticompetitive activities in state or federal court. SUBCHAPTER D. LICENSING AND REGISTRATION Sec. 39.121. LICENSING OF RETAIL ELECTRIC PROVIDERS. (a) Prohibits a person, including an affiliate or an electric utility, from providing electric service in this state in areas where retail competition has been introduced unless the person obtains a license as a retail electric provider from PUC. (b) Provides that the licensing requirement does not apply to a municipally owned utility or distribution cooperative to provide retail electric service to the areas where it is providing electric service on the date of enactment of this Act or is authorized to provide electric service under a certificate of public convenience and necessity. (c) Requires PUC to issue a license to provide retail electric service to a person applying who demonstrates financial and technical capability to provide continuous and reliable service to customers in the area, and who demonstrates the organization, personnel, and other resources needed to meet the customer protection requirements of this Act. Sec. 39.122. REGISTRATION OF WHOLESALE POWER SELLERS. (a) Prohibits a person from selling electricity for resale unless the person registers with PUC as a wholesale power seller, except as provided in this section. Authorizes a person to register as a wholesale power seller by filing with PUC a description of the location of any facility used to generate electricity, the type of services provided, a copy of any information filed with the Federal Energy Regulatory Commission in connection with registration with that commission, and any other information required by PUC rule. (b) Requires a wholesale power seller to comply with the reliability standards adopted by an independent organization certified by PUC to ensure the reliability of the regional electric network for a region in which the wholesale power seller is generating electricity or transmitting or selling electricity. Sec. 39.123. REVOCATION OF LICENSE OR REGISTRATION. (a) Authorizes PUC to suspend, revoke, or amend a retail electric provider license for significant violations of this Act, or the rules adopted in relation to this Act. Authorizes PUC to suspend or revoke a retail electric provider's license if the provider no longer has the financial or technical capability to provide continuous and reliable electric service. (b) Authorizes PUC to suspend or revoke a wholesale power seller's registration for significant violations of this Act, the rules adopted in relation to this Act, or the reliability standards adopted by an independent organization certified by PUC to ensure the reliability of the regional electric network. Sec. 39.124. LOCAL REGISTRATION OF RETAIL ELECTRIC PROVIDERS. Authorizes a municipality to require the registration of a retail electric provider as a condition of serving the residents of the municipality, and to assess a reasonable administrative fee for this purpose. Authorizes the municipality to suspend or revoke a retail electric provider's registration and operation in that municipality for significant violations of this Act or the rules adopted regarding this Act. SUBCHAPTER E. PLANNING Sec. 39.151. PLANNING FOR ELECTRIC UTILITIES SUBJECT TO SECTIONS 39.002 AND 39.003. Provides that Chapter 34, Utilities Code (Electrical Planning), does not apply in regions subject to competition under Sections 39.002 and 39.003. Sec. 39.152. RENEWABLE ENERGY TECHNOLOGIES. (a) Provides that the goal and intent of the Legislature is that by January 1, 2005, renewable technologies comprise no less than three percent of the installed electric generation capacity that is physically located in the state and available for the sale of power at wholesale or retail. (b) Provides that the introduction of competition and retail customer choice is expected to create opportunities that will stimulate the economic development of renewable energy technologies in the state to a level that achieves the stated goal through the reliance upon market forces alone. (c) Provides that a market failure shall be assumed if PUC finds by January 1, 2003, that renewable energy technologies comprise less than 1.5 percent of the electric generation capacity. (d) Requires PUC, in the event of such market failure, to take appropriate measures to meet the stated goal, including, but not limited to, the imposition of a non-bypassable charge to fund renewable energy technology development or tradable renewable energy credits. SUBCHAPTER F. CUSTOMER PROTECTION Sec. 39.171. CUSTOMER PROTECTION POLICY. Sets forth the legislative findings. Sec. 39.172. CUSTOMER PROTECTION STANDARDS. (a) Sets forth rights of buyers in a competitive retail market. (b) Sets forth the additional rights of residential and small commercial customers. (c) Requires PUC to establish a program for assistance to low-income customers to be funded by a charge up to $0.05 per megawatt-hour collected from all customers in an equitable manner. Requires that all funds from the charge be remitted to the Comptroller of Public Accounts and fully disbursed as directed by the Texas Department of Housing and Community Affairs to support qualifying programs. (d) Requires PUC to conduct customer education campaigns, beginning September 1, 2000, in connection with the initiation of competition in retail electric services. Requires that the campaigns be designed and conducted to provide residential and small commercial customers objective information concerning the initiation of retail electric competition and the options available to them. Authorizes PUC to engage independent consultants and requires consultation with the Public Utility Counsel in developing the campaigns and information to be provided to customers. Authorizes PUC to contract with professional services to carry out the customer education campaigns. Requires that the campaigns be designed to provide broad dissemination of information to the public and to include efforts to reach persons who are not proficient in English or are difficult to reach through standard communication media. (e) Requires PUC to conduct an ongoing customer education campaign designed to help customers make informed choices of electric services and retail electric providers. Authorizes PUC to provide information concerning specific retail electric providers, such as the instances of complaints against them and records relating to the quality of service, as part of the education campaign. (f) Requires PUC to adopt rules to carry out this subchapter, including, but not limited to, rules for minimum service standards for retail electric providers relating to customer deposits and the extension of credit, switching fees, levelized billing programs, termination of service, and quality of service. Sec. 39.173. RESOLUTION OF DISPUTES. Authorizes PUC to resolve disputes between a customer and a retail electric provider. Authorizes PUC to order the refund of overcharges or unauthorized charges or to make other restitution where the retail electric provider has failed to comply with PUC's customer protection rules or a contract with the customer. Authorizes PUC to order other appropriate relief including the restoration of the customer's choice of service provider, penalties, and compensation for the customer's losses if PUC determines that a retail electric provider failed to honor a customer's choice of service provider. Authorizes PUC to adopt rules to require the continuation of service to a residential or small commercial customer during a pending dispute. Sec. 39.174. ACCESS TO PREMISES. Provides that a person leasing or using a building, space within a building, or any other facility that is separately metered for electric service, has the right to choose a retail electric provider, and requires the owner of the building or facility to grant access on reasonable, non-discriminatory terms, to permit the installation, maintenance, and reading of meters. Sec. 39.175. LIMITATIONS ON TELEPHONE SOLICITATION. Prohibits any person from making or causing to be made any telephone solicitation to any customer who has notified PUC of the customer's objection to receiving telephone solicitations. Requires PUC to establish and provide for the operation of a data base to compile a list of customers who object to receiving telephone solicitations. Authorizes PUC to operate such data base directly or to contract with another entity. Requires that each customer be charged a fee not to exceed $5.00 for inclusion in the data base. SUBCHAPTER G. GENERAL PROVISIONS Sec. 39.201. REPORTS. Authorizes PUC to require a retail electric provider or wholesale power producer or seller to submit a report concerning any matter over which PUC has authority under this Act. Sec. 39.202. COMMISSION AUTHORITY. Requires PUC to adopt and enforce rules as necessary or appropriate to carry out this chapter. Sec. 39.203. PENALTIES. Authorizes PUC to impose administrative penalties on an electric utitlity, a retail electric provider, or a wholesale electric seller using the procedures set out in Sections 15.024 through 15.033, Utilities Code, relating to administrative and civil penalties. Sec. 39.024. COOPERATION WITH OTHER REGULATORY AUTHORITIES. Authorizes PUC to cooperate with the utility regulatory commission of the other state or the federal government in regulating the rates, operations, and services of an electric utility that provides services in another state, and authorizes PUC to hold a joint hearing or make a joint investigation. SECTION 4. Amends Section 12.005, Subtitle A, Title 2, Utilities Code, to establish September 1, 2003, rather than September 1, 2001, as the date of expiration of this title under the application of the Texas Sunset Act. SECTION 5. Amends Section 16.001, Subtitle A, Title 2, Utilities Code, to make a retail electric provider subject to assessments upon public utilities. Makes a conforming change. SECTION 6. Amends Section 182.021, Chapter 182, Tax Code, to add a retail electric provider that makes local sales within an incorporated city or town in this state to the definition of "utility company." Excludes from the definition of "utility company" a person who owns an electric light or electric power plant used for distribution but that does not make retail sales to ultimate consumers within an incorporated city or town in this state. Excludes, for purposes of Section 182.025, Tax Code (Charges by a City), a retail electric provider as defined in Section 31.002, Utilities Code, added by this bill. Provides that "utility company" includes a person who owns an electric light or electric power plant used for distribution even if that person does not make retail sales to ultimate consumers within an incorporated city or town in this state. SECTION 7. Amends Section 182.025, Chapter 182, Tax Code, to provide that the total charges levied by an incorporated city or town for the use of a city street, alley, or public way by a public utility in the course of its business is limited to ten percent of the gross receipts of a public utility that provides only the service of distribution of electric energy and does not make sales to the ultimate consumer. SECTION 8. Effective date: September 1, 1999. SECTION 9. Emergency clause.