Texas 2009 - 81st Regular

Texas House Bill HB870 Compare Versions

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1	1	81R4170 TJS-D
2	2	By: Hughes H.B. No. 870
3	3
4	4
5	5	A BILL TO BE ENTITLED
6	6	AN ACT
7	7	relating to transition to competition in the Southwestern Electric
8	8	Power Company service area.
9	9	BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
10	10	SECTION 1. Chapter 39, Utilities Code, is amended by adding
11	11	Subchapter K to read as follows:
12	12	SUBCHAPTER K. TRANSITION TO COMPETITION FOR CERTAIN
13	13	AREAS OUTSIDE OF ERCOT
14	14	Sec. 39.501. APPLICABILITY. (a) This subchapter applies
15	15	to an investor-owned electric utility:
16	16	(1) that is operating solely outside of ERCOT in areas
17	17	of this state that were included in the Southwest Power Pool on
18	18	January 1, 2008;
19	19	(2) that was not affiliated with the Southeastern
20	20	Electric Reliability Council on January 1, 2008; and
21	21	(3) to which Subchapter I does not apply.
22	22	(b) The legislature finds that an electric utility subject
23	23	to this subchapter is unable at this time to offer fair competition
24	24	and reliable service to all retail customer classes in this state.
25	25	As a result, the introduction of retail competition for such an
26	26	electric utility is delayed until fair competition and reliable
27	27	service are available to all retail customer classes in this state.
28	28	Sec. 39.502. COST-OF-SERVICE REGULATION. (a) Until the
29	29	date on which an electric utility subject to this subchapter is
30	30	authorized by the commission under Section 39.503(g) to implement
31	31	retail customer choice, the rates of the utility are subject to
32	32	regulation under Chapter 36.
33	33	(b) Until the date on which an electric utility subject to
34	34	this subchapter implements customer choice, the provisions of this
35	35	chapter, other than this subchapter and Sections 39.904 and 39.905,
36	36	do not apply to that utility.
37	37	Sec. 39.503. TRANSITION TO COMPETITION. (a) The sequence
38	38	of events prescribed by Subsections (b)-(g) shall be followed to
39	39	introduce retail competition in the service area of an electric
40	40	utility subject to this subchapter. All listed items in a
41	41	subsection must be completed before the events provided by the next
42	42	subsection are initiated. Full retail competition may not begin in
43	43	the service area of an electric utility subject to this subchapter
44	44	until all actions prescribed by those subsections are completed.
45	45	(b) The first stage for the transition to competition
46	46	consists of the following activities:
47	47	(1) approval of a regional transmission organization
48	48	by the Federal Energy Regulatory Commission for the power region
49	49	that includes the electric utility's service area and commencement
50	50	of independent operation of the transmission network under the
51	51	approved regional transmission organization;
52	52	(2) development of retail market protocols to
53	53	facilitate retail competition; and
54	54	(3) completion of an expedited proceeding to develop
55	55	non-bypassable delivery rates for the customer choice pilot project
56	56	to be implemented under Subsection (c)(1).
57	57	(c) The second stage for the transition to competition
58	58	consists of the following activities:
59	59	(1) initiation of the customer choice pilot project in
60	60	accordance with Section 39.104;
61	61	(2) development of a balancing energy market, a market
62	62	for ancillary services, and a market-based congestion management
63	63	system for the wholesale market in the power region in which the
64	64	regional transmission organization operates; and
65	65	(3) implementation of a seams agreement with adjacent
66	66	power regions to reduce barriers to entry and facilitate
67	67	competition.
68	68	(d) The third stage for the transition to competition
69	69	consists of the following activities:
70	70	(1) the electric utility filing with the commission:
71	71	(A) an application for business separation in
72	72	accordance with Section 39.051;
73	73	(B) an application for unbundled transmission
74	74	and distribution rates in accordance with Section 39.201;
75	75	(C) an application for certification of a
76	76	qualified power region in accordance with Section 39.152; and
77	77	(D) an application for price-to-beat rates in
78	78	accordance with Section 39.202;
79	79	(2) the commission:
80	80	(A) approving a business separation plan for the
81	81	utility;
82	82	(B) setting unbundled transmission and
83	83	distribution rates for the utility;
84	84	(C) certifying a qualified power region, which
85	85	includes conducting a formal evaluation of wholesale market power
86	86	in the region, in accordance with Section 39.152;
87	87	(D) setting price-to-beat rates for the utility;
88	88	and
89	89	(E) determining which competitive energy
90	90	services must be separated from regulated utility activities in
91	91	accordance with Section 39.051; and
92	92	(3) completion of the testing of retail and wholesale
93	93	systems, including those systems necessary for switching customers
94	94	to the retail electric provider of their choice and for settlement
95	95	of wholesale market transactions, by the regional transmission
96	96	organization, the statewide registration agent, and market
97	97	participants.
98	98	(e) The fourth stage for the transition to competition
99	99	consists of the following activities:
100	100	(1) commission evaluation of the results of the pilot
101	101	project;
102	102	(2) initiation by the electric utility of a capacity
103	103	auction in accordance with Section 39.153 at a time to be determined
104	104	by the commission; and
105	105	(3) separation by the utility of competitive energy
106	106	services from its regulated utility activities, in accordance with
107	107	the commission order approving the separation of competitive energy
108	108	services.
109	109	(f) The fifth stage for the transition to competition
110	110	consists of evaluation by the commission of whether the electric
111	111	utility can offer fair competition and reliable service to all
112	112	retail customer classes in this state, and:
113	113	(1) if the commission concludes that the electric
114	114	utility can offer fair competition and reliable service to all
115	115	retail customer classes in this state, the commission submitting a
116	116	report to the legislature recommending the enactment by the
117	117	legislature of a law authorizing the implementation of retail
118	118	competition by the utility; and
119	119	(2) if the commission determines that the electric
120	120	utility cannot offer fair competition and reliable service to all
121	121	retail customer classes in this state, the commission issuing an
122	122	order further delaying retail competition for the utility.
123	123	(g) The sixth stage for the transition to competition
124	124	consists of the following activities:
125	125	(1) the enactment of a law by the legislature
126	126	authorizing the implementation of retail competition by the
127	127	utility;
128	128	(2) if the legislature enacts that law, the issuance
129	129	of an order from the commission authorizing the utility to
130	130	implement retail competition; and
131	131	(3) on the issuance of an order from the commission
132	132	authorizing the implementation of retail competition by the
133	133	utility, completion by the utility of the business separation and
134	134	unbundling in accordance with the commission order approving the
135	135	unbundling.
136	136	SECTION 2. This Act takes effect September 1, 2009.