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A BILL TO BE ENTITLED
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AN ACT
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relating to the terms of a water supply contract with the Sabine |
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River Authority in connection with the production of electricity. |
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BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS: |
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SECTION 1. Chapter 110, Acts of the 51st Legislature, |
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Regular Session, 1949, is amended by adding Section 22A to read as |
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follows: |
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Sec. 22A. (a) In this section: |
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(1) "Buyer" means a corporation that uses water to |
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produce hydro-electric power. |
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(2) "Fund" means the economic stability fund. |
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(3) "Contract" means a water supply contract entered |
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into between the district and the buyer on or after September 1, |
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2007. |
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(4) "Reservoir" means the Toledo Bend Reservoir. |
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(b) If the district and the buyer enter into a contract, the |
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contract shall include the terms provided by this section. |
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(c) The contract shall require that a portion of the |
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district's income from the sale of water be placed in a fund to be |
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known as the economic stability fund, which is to be maintained in |
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trust and used only as provided by this section. |
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(d) The district shall determine the amount of money to be |
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deposited in the fund that will be reasonably sufficient to cover |
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the payments described by Subsection (f) of this section, and this |
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amount shall be specified in the contract. The district shall use |
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historic and other relevant hydrological data in making the |
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determination under this subsection. |
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(e) The contract shall provide that if the reservoir falls |
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below 168 feet above mean sea level, the district shall give notice |
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to the buyer that it must: |
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(A) suspend its withdrawals from the reservoir |
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immediately on receipt of the notice; and |
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(B) meet its remaining contracted-for |
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electricity requirements on the spot market. |
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(f) For any purchases of electricity the buyer makes on the |
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spot market because the buyer suspended its withdrawals under |
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Subsection (e) of this section, the contract shall require the |
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district to pay the buyer an amount out of the fund equal to the |
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difference between the cost to the buyer of obtaining the |
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electricity through the purchases and what the cost to the buyer of |
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the electricity would have been had the buyer not been required to |
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suspend its withdrawals. The contract shall require the buyer to |
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use reasonable diligence in purchasing electricity at the lowest |
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available price on the spot market and to make available to the |
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district all records related to purchases under this subsection. |
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(g) The contract shall require the buyer to cease its |
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purchases of electricity on the spot market upon receipt of |
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notification from the district that the reservoir has returned to a |
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level that is sufficient to allow the resumption of reservoir |
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withdrawals under the contract. |
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SECTION 2. This Act takes effect September 1, 2007. |