Texas House Bill HB3406

Texas 2009 - 81st Regular

• Out of House Committee: 4/20/09

Caption

Relating to certificates of convenience and necessity.

Impact

The implications of HB3406 extend to the procedures by which utility companies must operate within Texas. By mandating a clearer requirement for obtaining necessary certification, the bill enhances regulatory oversight over utility operations. This could lead to a more uniform standard of service delivery across the state, potentially preventing situations where unregulated entities offer substandard services. Consequently, this can protect consumers by ensuring that utilities meet specific operational criteria before delivering services.

Summary

House Bill 3406 pertains to the regulation and requirements for obtaining certificates of convenience and necessity for utility services, specifically electricity. The bill amends several sections of the Texas Utilities Code, establishing that no entity may provide service to the public without first obtaining a certificate from the commission that confirms public necessity for the service. This legislation emphasizes the structured approach in ensuring that utility services adhere to predefined standards before commencement. The revisions aim to streamline the application process for obtaining such certificates and require utilities to serve every consumer within their designated certified area.

Contention

Though the bill is largely focused on improving regulatory compliance, discussions surrounding it may touch upon concerns about bureaucratic processes potentially stifling competition. Critics may argue that stringent certification requirements could hinder new market entrants from providing innovative solutions or alternative services, thereby limiting consumer choice. Additionally, the insistence on serving every consumer in a utility's certificated area might impose financial burdens, particularly on smaller utilities or those serving less profitable regions.