By: Rodriguez, Uresti S.B. No. 1910
 
 
A BILL TO BE ENTITLED
 
AN ACT
  relating to the delay of the transition to competition for an
  electric utility located in the Western Electricity Coordinating
  Council service area and net metering requirements and energy
  efficiency goals and programs for such utility.
         BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
         SECTION 1.  Chapter 39, Utilities Code, is amended by adding
  Subchapter L to read as follows:
  SUBCHAPTER L.  TRANSITION TO COMPETITION FOR CERTAIN
  AREAS OUTSIDE ERCOT
         Sec. 39.551.  APPLICABILITY. (a)  This subchapter applies
  only to an investor-owned electric utility:
               (1)  that is operating solely outside of ERCOT in areas
  of this state that were included in the Western Electricity
  Coordinating Council on January 1, 2011;
               (2)  that was not affiliated with ERCOT on January 1,
  2011; and
               (3)  to which Subchapters I, J, and K do not apply.
         (b)  The legislature finds that an electric utility subject
  to this subchapter is unable at this time to offer fair competition
  and reliable service to all retail customer classes in the area
  served by the utility. As a result, the introduction of retail
  competition for such electric utility is delayed until fair
  competition and reliable service are available to all retail
  customer classes as determined under this subchapter.
         Sec. 39.552.  COST-OF-SERVICE REGULATION. (a)  Until the
  date on which an electric utility subject to this subchapter is
  authorized by the commission under Section 39.553(f) to implement
  retail customer choice, the rates of the utility are subject to
  regulation under Chapter 36.
         (b)  Until the date on which an electric utility subject to
  this subchapter implements customer choice, the provisions of this
  chapter, other than this subchapter and Sections 39.904 and 39.905,
  do not apply to that utility.
         Sec. 39.553.  TRANSITION TO COMPETITION. (a)  The events
  prescribed by Subsections (b)-(f) shall be followed to introduce
  retail competition in the service area of an electric utility
  subject to this subchapter. The commission shall ensure that the
  listed items in each stage are completed before the next stage is
  initiated. Unless stated otherwise, the commission shall conduct
  each activity with the electric utility and other interested
  parties. The commission may modify the sequence of events required
  by Subsections (b)-(e), but not the substance of the requirements,
  if the commission finds good cause to do so. Full retail
  competition may not begin in the service area of an electric utility
  subject to this subchapter until all actions prescribed by those
  subsections are completed.
         (b)  The first stage for the transition to competition
  consists of the following activities:
               (1)  approval of a regional transmission organization
  by the Federal Energy Regulatory Commission for the power region
  that includes the electric utility's service area and commencement
  of independent operation of the transmission network under the
  approved regional transmission organization;
               (2)  development of retail market protocols to
  facilitate retail competition; and
               (3)  completion of an expedited proceeding to develop
  nonbypassable delivery rates for the customer choice pilot project
  to be implemented under Subsection (c)(1).
         (c)  The second stage for the transition to competition
  consists of the following activities:
               (1)  initiation of the customer choice pilot project in
  accordance with Section 39.104;
               (2)  development of a balancing energy market, a market
  for ancillary services, and a market-based congestion management
  system for the wholesale market in the power region in which the
  regional transmission organization operates; and
               (3)  implementation of a seams agreement with adjacent
  power regions to reduce barriers to entry and facilitate
  competition.
         (d)  The third stage for the transition to competition
  consists of the following activities:
               (1)  the electric utility filing with the commission:
                     (A)  an application for business separation in
  accordance with Section 39.051;
                     (B)  an application for unbundled transmission
  and distribution rates in accordance with Section 39.201;
                     (C)  an application for certification of a
  qualified power region in accordance with Section 39.152; and
                     (D)  an application for price-to-beat rates in
  accordance with Section 39.202;
               (2)  the commission:
                     (A)  approving a business separation plan for the
  utility;
                     (B)  setting unbundled transmission and
  distribution rates for the utility;
                     (C)  certifying a qualified power region, which
  includes conducting a formal evaluation of wholesale market power
  in the region, in accordance with Section 39.152;
                     (D)  setting price-to-beat rates for the utility;
  and
                     (E)  determining which competitive energy
  services must be separated from regulated utility activities in
  accordance with Section 39.051; and
               (3)  completion of the testing of retail and wholesale
  systems, including those systems necessary for switching customers
  to the retail electric provider of their choice and for settlement
  of wholesale market transactions, by the regional transmission
  organization, the registration agent, and market participants.
         (e)  The fourth stage for the transition to competition
  consists of the following activities:
               (1)  commission evaluation of the results of the pilot
  project;
               (2)  initiation by the electric utility of a capacity
  auction in accordance with Section 39.153 at a time to be determined
  by the commission; and
               (3)  separation by the utility of competitive energy
  services from its regulated utility activities, in accordance with
  the commission order approving the separation of competitive energy
  services.
         (f)  The fifth stage for the transition to competition
  consists of the following activities:
               (1)  evaluation by the commission of whether the
  electric utility can offer fair competition and reliable service to
  all retail customer classes in the area served by the utility and:
                     (A)  if the commission concludes that the electric
  utility can offer fair competition and reliable service to all
  retail customer classes in the area served by the utility, issuance
  by the commission of an order initiating retail competition for the
  utility; and
                     (B)  if the commission determines that the
  electric utility cannot offer fair competition and reliable service
  to all retail customer classes in the area served by the utility,
  issuance by the commission of an order further delaying retail
  competition for the utility; and
               (2)  on the issuance of an order by the commission
  initiating retail competition for the utility, completion by the
  utility of the business separation and unbundling in accordance
  with the commission order approving the unbundling.
         Sec. 39.554.  INTERCONNECTION OF DISTRIBUTED RENEWABLE
  GENERATION.  (a)  In this section:
               (1)  "Distributed renewable generation" means electric
  generation with a capacity of not more than 2,000 kilowatts
  provided by a renewable energy technology, as defined by Section
  39.904, that is installed on a retail customer's side of the meter.
               (2)  "Distributed renewable generation owner" has the
  meaning assigned under Section 39.916(a).
               (3)  "Interconnection" means the right of a distributed
  renewable generation owner to physically connect distributed
  renewable generation to an electricity distribution system and the
  technical requirements, rules, or processes for the connection.
         (b)  A distributed renewable generation owner may request
  interconnection by filing an application for interconnection with
  the electric utility. A retail customer's application for
  interconnection with an electric utility in accordance with this
  subsection is subject to the safety and reliability requirements of
  the electric utility.  Procedures of the electric utility for the
  submission and processing of a distributed renewable generation
  owner's application for interconnection shall be consistent with
  rules adopted by the commission regarding interconnection.
         (c)  The electric utility shall install, own, and maintain
  the meter and metering equipment.  The retail customer shall
  install a customer-furnished meter socket or metering cabinet, or
  both, at the electric utility's designated location solely on the
  retail customer's premises.  The electric utility, at its own
  expense, may install load research metering equipment solely on the
  retail customer's premises.  The retail customer shall also supply,
  at no expense to the electric utility, a suitable location for
  meters and associated equipment that will be used for billing and
  for load research.
         (d)  For a retail customer (1) that is an apartment house for
  occupancy by low-income elderly tenants reasonably expected to
  generate not less than 50 percent of its annual energy use with
  distributed renewable generation and qualifying for master
  metering pursuant to Section 184.012(b), or (2) that has a
  qualifying facility with a design capacity that is 50 kilowatts or
  less, and such distributed renewable generation or qualifying
  facility identified in this subsection is rated to produce an
  amount of electricity that is less than or equal to the amount of
  electricity the retail customer consumed in the 12-month period
  prior to installation of the qualifying facility or, for new
  facilities, the estimated annual kilowatt-hour consumption, in
  addition to the metering options in Section 39.916(f), the electric
  utility shall also provide such customer with the additional option
  of interconnection with the electric utility through a single meter
  that runs forward and backward. Any renewable generation
  production for a given billing period by a retail customer choosing
  this additional option shall offset consumption for the billing
  period by the customer, and excess production from the renewable
  generation above the retail customer's consumption for a given
  billing period shall be credited to the customer in accordance with
  the provisions of Subsection (e).
         (e)  An electric utility that purchases surplus generated
  electricity from a distributed renewable generation owner in
  accordance with this subsection shall purchase surplus generated
  electricity generated by the distributed renewable generation
  owner at the cost of the electric utility as determined by
  commission rule and:
               (1)  the electric utility shall take reasonable steps
  to inform the distributed renewable generation owner of the amount
  of surplus electricity purchased as measured in kilowatt hours
  during the retail customer's most recent billing cycle; and
               (2)  the amount of any credit balance on a monthly bill
  of a retail electric customer with distributed renewable energy may
  be carried forward on the retail customer's bill until the credit
  exceeds $50, at which time the electric utility must provide a
  refund of the credit balance to the retail customer.
         Sec. 39.555.  MARKETING OF ENERGY EFFICIENCY AND RENEWABLE
  ENERGY PROGRAMS. An electric utility subject to this subchapter
  may directly market energy efficiency and renewable energy programs
  to retail customers within its service territory and provide rebate
  or incentive funds directly to its customers to promote or
  facilitate the success of the programs subject to Section 39.905.
         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, 2011.