78R8860 SMH-F

By:  Turner                                                       H.B. No. 2745



A BILL TO BE ENTITLED

AN ACT

relating to the review and approval by the General Land Office of 
energy acquisition contracts entered into by certain public retail 
customers.
	BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:                        
	SECTION 1.  Sections 31.401 and 31.402, Natural Resources 
Code, are amended to read as follows:
	Sec. 31.401.  ENERGY [NATURAL GAS] ACQUISITION CONTRACTS.  
(a)  The land office shall review and must approve any contract 
entered into by a public retail customer [state agency] for the 
acquisition of an annual average of 100 MCF per day or more of 
natural gas, or an annual average of 500 kilowatts of peak demand 
electricity, used to meet its energy requirements.
	(b)  Before approving a contract described by Subsection (a) 
of this section, the land office shall ensure that the public retail 
customer [agency], to meet its energy requirements, is using, to 
the greatest extent practical, natural gas produced from, or 
electricity produced using in-kind royalty gas produced from, land 
leased from:
		(1)  the school land board;                                                   
		(2)  a board for lease other than the Board for Lease of 
University Lands; or
		(3)  the surface owner of Relinquishment Act land.                            
	(c)  A public retail customer may not enter into a contract 
to which this section applies until the land office reviews and 
approves the contract as provided by this section. If the land 
office is able to substitute a contract using in-kind royalty gas 
from state-owned lands or using other gas, or using electricity 
produced using in-kind royalty gas produced from state-owned lands 
or using other electricity, for a contract under which a public 
retail customer [state agency] acquires or proposes to acquire its 
energy [natural gas] supplies, the commissioner shall maintain a 
record [inform the comptroller each month] of the amount of savings 
attributable to the substitution.
	(d)  In this section, "public retail customer" ["state 
agency"] has the meaning assigned by Section 35.101, Utilities
[Subchapter A, Chapter 572, Government] Code, except that the term 
does not include a county or municipality.
	Sec. 31.402.  RULES.  The commissioner shall adopt any rules 
necessary to carry out this subchapter, including rules regarding 
review and approval of energy [natural gas] acquisition contracts 
under Section 31.401 [of this code].
	SECTION 2.  This Act takes effect immediately if it receives 
a vote of two-thirds of all the members elected to each house, as 
provided by Section 39, Article III, Texas Constitution.  If this 
Act does not receive the vote necessary for immediate effect, this 
Act takes effect September 1, 2003.