82R27823 JXC-F
By: Rodriguez, et al. S.B. No. 1910
(Margo, Pickett, Quintanilla, Marquez)
Substitute the following for S.B. No. 1910: No.
A BILL TO BE ENTITLED
AN ACT
relating to the delay of the transition to competition in the
Western Electricity Coordinating Council service area and to net
metering and energy efficiency goals and programs for utilities in
that area.
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 AND OTHER PROVISIONS FOR
CERTAIN AREAS OUTSIDE OF 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 an 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, the
commission issuing 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,
the commission issuing an order further delaying retail competition
for the utility; and
(2) on the issuance of an order from 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" has the
meaning assigned by Section 39.916.
(2) "Distributed renewable generation owner" means an
owner of distributed renewable generation that is a retail electric
customer.
(3) "Interconnection" has the meaning assigned by
Section 39.916.
(b) A distributed renewable generation owner in the service
area of an electric utility subject to this subchapter may request
interconnection by filing an application for interconnection with
the utility. An application for interconnection is subject to the
utility's safety and reliability requirements. The utility's
procedures for the submission and processing of an application for
interconnection shall be consistent with rules adopted by the
commission regarding interconnection.
(c) An electric utility that approves an application of a
distributed renewable generation owner under Subsection (b):
(1) shall install, maintain, and retain ownership of
the meter and metering equipment; and
(2) may install load research metering equipment on
the premises of the owner, at no expense to the owner.
(d) At the request of an electric utility that approves an
application of a distributed renewable generation owner under
Subsection (b), the owner shall:
(1) provide and install a meter socket, a metering
cabinet, or both a socket and cabinet at a location designated by
the utility on the premises of the owner; and
(2) provide, at no expense to the utility, a suitable
location for the utility to install meters and equipment associated
with billing and load research.
(e) An electric utility that approves an application of a
distributed renewable generation owner under Subsection (b) shall
provide to the owner the metering options described by Section
39.916(f) and an option to interconnect with the utility through a
single meter that runs forward and backward if:
(1) the owner:
(A) intends to interconnect the distributed
renewable generation at an apartment house, as defined by Section
184.011, occupied by low-income elderly tenants that qualifies for
master metering under Section 184.012(b) and the distributed
renewable generation is reasonably expected to generate not less
than 50 percent of the apartment house's annual electricity use; or
(B) has a qualifying facility with a design
capacity of not more than 50 kilowatts; and
(2) the distributed renewable generation or
qualifying facility that is the subject of the application is rated
to produce an amount of electricity that is less than or equal to:
(A) the owner's estimated annual kilowatt hour
consumption for a new apartment house or qualifying facility; or
(B) the amount of electricity the owner consumed
in the year before installation of the distributed renewable
generation or qualifying facility.
(f) For a distributed renewable generation owner that
chooses interconnection through a single meter under Subsection
(e):
(1) the amount of electricity the owner generates
through distributed renewable generation or a qualifying facility
for a given billing period offsets the owner's consumption for that
billing period; and
(2) any electricity the owner generates through
distributed renewable generation or a qualifying facility that
exceeds the owner's consumption for a given billing period shall be
credited to the owner under Subsection (g).
(g) An electric utility that purchases surplus electricity
under Subsection (f)(2) shall purchase the electricity from the
distributed renewable generation owner at the cost of the utility
as determined by commission rule. The utility shall take
reasonable steps to inform the owner of the amount of surplus
electricity purchased from the owner in kilowatt hours during the
owner's most recent billing cycle. A credit balance of not more
than $50 on the owner's monthly bill may be carried forward onto the
owner's next monthly bill. The utility shall refund to the owner a
credit balance that is not carried forward or the portion of a
credit balance that exceeds $50 if the credit balance is carried
forward.
(h) In a base rate proceeding or fuel cost recovery
proceeding conducted under Chapter 36, the commission shall ensure
that any additional cost associated with the metering and payment
options described by Subsections (e), (f), and (g) is allocated
only to customer classes that include distributed renewable
generation owners who have chosen those metering options.
Sec. 39.555. MARKETING OF ENERGY EFFICIENCY AND RENEWABLE
ENERGY PROGRAMS. An electric utility subject to this subchapter
may market an energy efficiency or renewable energy program
directly to a retail electric customer in its service territory and
provide rebate or incentive funds directly to a customer to promote
or facilitate the success of programs implemented under 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.