By:  Estes                                                        S.B. No. 1668


A BILL TO BE ENTITLED

AN ACT

relating to the affiliate burden of proof applicable to electric 
utilities. 
	BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:                        
	SECTION 1.  Section 36.058(c), Utilities Code, is amended to 
read as follows:
	(c)  A finding under Subsection (b) must include:                              
		(1)  a specific finding of the reasonableness and 
necessity of each item or class of items allowed; and
		(2)  a finding that the price to the electric utility is 
not higher than the prices charged by the supplying affiliate to its 
other affiliates or divisions or to a nonaffiliated person for the 
same item or class of items to:  (A)  its other affiliates or 
divisions; or (B)  a nonaffiliated person within the same market 
area or having the same market conditions.
	SECTION 2.  Section 36.058, Utilities Code, is amended by 
adding the following subsection (f):
	(f)  If the commission finds that the affiliate expense for 
the test period is unreasonable, the commission shall:
		(1)  determine the reasonable level of the expense; and                
		(2)  include that expense in determining the utility's 
cost of service.
	SECTION 3.  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, 2005.