By:  Estes                                                        S.B. No. 1668
	(In the Senate - Filed March 11, 2005; March 30, 2005, read 
first time and referred to Committee on Business and Commerce; 
April 11, 2005, reported adversely, with favorable Committee 
Substitute by the following vote:  Yeas 9, Nays 0; April 11, 2005, 
sent to printer.)


COMMITTEE SUBSTITUTE FOR S.B. No. 1668                                   By:  Estes


A BILL TO BE ENTITLED

AN ACT


relating to the consideration of payments to an affiliate in 
computing rates for electric utilities.
	BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:                        
	SECTION 1.  Section 36.058, Utilities Code, is amended by 
amending Subsection (c) and adding Subsection (f) 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.
	(f)  If the regulatory authority finds that an affiliate 
expense for the test period is unreasonable, the regulatory 
authority shall:
		(1)  determine the reasonable level of the expense; and                
		(2)  include that expense in determining the electric 
utility's cost of service.
	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, 2005.



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