88R3414 JXC-F
 
  By: Price H.B. No. 2061
 
 
 
A BILL TO BE ENTITLED
 
AN ACT
  relating to the recovery of purchased power costs by electric
  utilities.
         BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
         SECTION 1.  Section 36.206, Utilities Code, is amended to
  read as follows:
         Sec. 36.206.  MARK-UPS.  (a)  A cost recovery factor
  established for the recovery of purchased power costs must [may]
  include:
               (1)  the cost the electric utility incurs in purchasing
  capacity and energy; and
               (2)  a mark-up added to the cost or another mechanism
  the commission determines will:
                     (A)  reasonably compensate the utility for any
  administrative costs, financing costs, and financial risk
  associated with purchased power obligations so that the mark-up is
  sufficient to ensure that the utility has financial incentives to
  procure purchased power rather than rely solely on utility-owned
  generation; and
                     (B)  allow the utility to retain a reasonable
  portion of [(3)]  the value added by the utility in making the
  purchased power available to customers.
         (b)  The mark-ups and cost recovery factors:
               (1)  must [, if allowed, may] be retained by the
  electric utility; and 
               (2)  may not be less than an amount sufficient [those
  necessary] to encourage the [electric] utility to include
  economical purchased power as part of the utility's energy and
  capacity resource supply plan.
         (c)  An electric utility's rate of return established in the
  utility's base rate may not be reduced in connection with the
  implementation of this section.
         SECTION 2.  Section 36.207, Utilities Code, is repealed.
         SECTION 3.  Section 36.206, Utilities Code, as amended by
  this Act, applies only to a proceeding for the establishment of
  rates that begins on or after the effective date of this Act. A
  proceeding that begins before that date is governed by the law in
  effect immediately before the effective date of this Act, and that
  law is continued in effect for that purpose.
         SECTION 4.  This Act takes effect September 1, 2023.