LEGISLATIVE BUDGET BOARD Austin, Texas FISCAL NOTE, 76th Regular Session April 1, 1999 TO: Honorable J.E. "Buster" Brown, Chair, Senate Committee on Natural Resources FROM: John Keel, Director, Legislative Budget Board IN RE: SB 1152 by Bivins (relating to the authority of the state to obtain electricity and to sell or convey that electricity), Committee Report 1st House, Substituted ************************************************************************** * No significant fiscal implication to the State is anticipated. * ************************************************************************** Fiscal Analysis The bill would allow the General Land Office (GLO) to sell or convey power directly to a public retail customer, such as a state agency, institution of higher education, public school district, or unit of local government. The bill would provide the state with access to all transmission and distribution system utilities serving public retail customers. These electric utilities would be required to provide services to the state at the lowest applicable rate charged for a similar service to other customers. Methodology Authorizing the GLO to convert in-kind natural gas into electricity to be sold to public entities could result in some savings for electricity costs for state entities. There could also be some additional revenue to the state from the sale of electricity to the Permanent School Fund and the Permanent University Fund. Technology Impact None. Local Government Impact Public retail customers of a municipally owned electric utility would not be eligible for service from the GLO. As a result, the bill would not result in lost revenues to municipally owned utilities. Likewise, public retail customers within the municipally owned utility's service area would not benefit from the bill either. Additionally, to the extent that capacity is available on a gas pipeline, a municipally owned utility would have to make the capacity available. This could result in additional revenues for a municipally owned utility. No individual utility would be expected to experience a revenue decline greater than 2.5 percent, and some portion of such losses could be offset by a decrease in costs associated with providing service to fewer customers. Source Agencies: LBB Staff: JK, DE, TT