84R9496 JXC-F
 
  By: Fraser S.B. No. 931
 
 
 
A BILL TO BE ENTITLED
 
AN ACT
  relating to the goal for renewable energy and competitive renewable
  energy zones.
         BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
         SECTION 1.  Section 39.904, Utilities Code, is amended by
  amending Subsections (a), (b), (c), (h), (j), and (o) and adding
  Subsection (h-1) to read as follows:
         (a) It is the intent of the legislature that by January 1,
  2015, an additional 5,000 megawatts of generating capacity from
  renewable energy technologies will have been installed in this
  state.  The cumulative installed renewable capacity in this state
  shall total 5,880 megawatts by January 1, 2015, and the commission
  shall establish a target of 10,000 megawatts of installed renewable
  capacity by January 1, 2025.  The cumulative installed renewable
  capacity in this state shall total 2,280 megawatts by January 1,
  2007, 3,272 megawatts by January 1, 2009, 4,264 megawatts by
  January 1, 2011, 5,256 megawatts by January 1, 2013, and 5,880
  megawatts by January 1, 2015.  Of the renewable energy technology
  generating capacity installed to meet the goal of this subsection
  after September 1, 2005, the commission shall establish a target of
  having at least 500 megawatts of capacity from a renewable energy
  technology other than a source using wind energy.  The goal and
  targets established under this subsection terminate on December 31,
  2015.
         (b)  The commission shall establish a renewable energy
  credits trading program. Before December 31, 2015, a [Any] retail
  electric provider, municipally owned utility, or electric
  cooperative that does not satisfy the requirements of Subsection
  (a) by directly owning or purchasing capacity using renewable
  energy technologies shall purchase sufficient renewable energy
  credits to satisfy the requirements by holding renewable energy
  credits in lieu of capacity from renewable energy technologies. On
  or after December 31, 2015, a retail electric provider shall
  purchase sufficient renewable energy credits to verify any
  marketing claims the provider makes related to the content of
  renewable energy, as determined by the commission.
         (c)  Not later than January 1, 2000, the commission shall
  adopt rules necessary to administer and enforce this section. At a
  minimum, the rules shall:
               (1)  establish the minimum annual renewable energy
  requirement for each retail electric provider, municipally owned
  utility, and electric cooperative operating in this state in a
  manner reasonably calculated by the commission to produce, on a
  statewide basis, compliance with the requirement prescribed by
  Subsection (a); and
               (2)  specify reasonable performance standards that all
  renewable capacity additions must meet to earn renewable energy
  credits [count against the requirement prescribed by Subsection
  (a)] and that:
                     (A)  are designed and operated so as to maximize
  the energy output from the capacity additions in accordance with
  then-current industry standards; and
                     (B)  encourage the development, construction, and
  operation of new renewable energy projects at those sites in this
  state that have the greatest economic potential for capture and
  development of this state's environmentally beneficial renewable
  resources.
         (h)  The commission, in consultation with the independent
  organization certified for ERCOT, shall plan for transmission needs
  related to the incorporation of renewable energy in a manner
  consistent with the planning process for other types of generation
  resources, including by considering in the planning process [In
  considering an application for a certificate of public convenience
  and necessity for a transmission project intended to serve a
  competitive renewable energy zone, the commission is not required
  to consider] the factors provided by Section 37.056 [Sections
  37.056(c)(1) and (2)].
         (h-1)  The commission may not designate a new competitive
  renewable energy zone after January 1, 2015.
         (j)  The commission, after consultation with each
  appropriate independent organization, electric reliability
  council, or regional transmission organization, shall file a report
  with the legislature not later than December 31 of each
  even-numbered year.  The report must include[:
               [(1)     an evaluation of the commission's implementation
  of competitive renewable energy zones;
               [(2)     the estimated cost of transmission service
  improvements needed for each competitive renewable energy zone; and
               [(3)]  an evaluation of the effects that additional
  renewable generation has on system reliability and on the cost of
  alternatives to mitigate the effects.
         (o)  The commission may establish an alternative compliance
  payment to meet the goal established by Subsection (a) before its
  termination.  An entity that has a renewable energy purchase
  requirement under this section may elect to pay the alternative
  compliance payment instead of applying renewable energy credits
  toward the satisfaction of the entity's obligation under this
  section.  The commission may establish a separate alternative
  compliance payment for the goal of 500 megawatts of capacity from
  renewable energy technologies other than wind energy that an entity
  may use until January 1, 2016, to meet that goal.  The alternative
  compliance payment for a renewable energy purchase requirement that
  could be satisfied with a renewable energy credit from wind energy
  may not be less than $2.50 per credit or greater than $20 per
  credit.  Prior to September 1, 2009, an alternative compliance
  payment under this subsection may not be set above $5 per credit.  
  In implementing this subsection, the commission shall consider:
               (1)  the effect of renewable energy credit prices on
  retail competition;
               (2)  the effect of renewable energy credit prices on
  electric rates;
               (3)  the effect of the alternative compliance payment
  level on the renewable energy credit market; and
               (4)  any other factors necessary to ensure the
  continued development of the renewable energy industry in this
  state while protecting ratepayers from unnecessary rate increases.
         SECTION 2.  The recovery of a transmission facility
  investment made by an electric utility to serve a competitive
  renewable energy zone is governed by the law in effect on the date
  the facility is placed in service, regardless of whether the
  facility is completed before, on, or after the effective date of
  this Act, and that law is continued in effect for that purpose.
         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, 2015.