H.B. No. 1535
AN ACT
relating to rates of and certificates of convenience and necessity
for certain non-ERCOT electric utilities; authorizing a surcharge.
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
SECTION 1. Subchapter C, Chapter 36, Utilities Code, is
amended by adding Section 36.112 to read as follows:
Sec. 36.112. COST RECOVERY AND RATE ADJUSTMENT STANDARDS
AND PROCEDURES FOR CERTAIN NON-ERCOT UTILITIES. (a) This section
applies only to an electric utility that operates solely outside of
ERCOT.
(b) In establishing the base rates of the electric utility
under this subchapter or Subchapter D, the regulatory authority
shall determine the utility's revenue requirement based on, at the
election of the utility:
(1) information submitted for a test year; or
(2) information submitted for a test year, updated to
include information that reflects the most current actual or
estimated information regarding increases and decreases in the
utility's cost of service, including expenses, capital investment,
cost of capital, and sales.
(c) An electric utility that elects to provide updated
information under Subsection (b)(2) must provide the information
for a period ending not later than the 30th day before the date the
applicable rate proceeding is filed.
(d) An electric utility that includes estimated information
in the initial filing of a proceeding shall supplement the filing
with actual information not later than the 45th day after the date
the initial filing was made. The regulatory authority shall extend
the deadline for concluding the rate proceeding for a period of time
equal to the period between the date the initial filing of the
proceeding was made and the date of the supplemental filing, except
that the extension period may not exceed 45 days.
(e) An electric utility that makes an election under
Subsection (b) is not precluded from proposing known and measurable
adjustments to the utility's historical rate information as
permitted by this title and regulatory authority rules.
(f) Without limiting the availability of known and
measurable adjustments described by Subsection (e), the regulatory
authority shall allow an affected electric utility to make a known
and measurable adjustment to include in the utility's rates the
prudent capital investment, a reasonable return on such capital
investment, depreciation expense, reasonable and necessary
operating expenses, and all attendant impacts, including any
offsetting revenue, as determined by the regulatory authority,
associated with a newly constructed or acquired natural gas-fired
generation facility. The regulatory authority is required to allow
the adjustment only if the facility is in service before the
effective date of new rates. The adjustment may be made regardless
of whether the investment is less than 10 percent of the utility's
rate base before the date of the adjustment.
(g) This section expires September 1, 2023.
SECTION 2. Subchapter E, Chapter 36, Utilities Code, is
amended by adding Section 36.211 to read as follows:
Sec. 36.211. RELATION BACK OF RATES FOR CERTAIN NON-ERCOT
UTILITIES. (a) This section applies only to an electric utility
that operates solely outside of ERCOT.
(b) In a rate proceeding under Subchapter D, or if requested
by an electric utility in the utility's statement of intent
initiating a rate proceeding under Subchapter C, notwithstanding
Section 36.109(a), the final rate set in the proceeding, whether a
rate increase or rate decrease, shall be made effective for
consumption on and after the 155th day after the date the
rate-filing package is filed.
(c) The regulatory authority shall:
(1) require the electric utility to refund to
customers money collected in excess of the rate finally ordered on
or after the 155th day after the date the rate-filing package is
filed; or
(2) authorize the electric utility to surcharge bills
to recover the amount by which the money collected on or after the
155th day after the date the rate-filing package is filed is less
than the money that would have been collected under the rate finally
ordered.
(d) The regulatory authority may require refunds or
surcharges of amounts determined under Subsection (c) over a period
not to exceed 18 months, along with appropriate carrying costs. The
regulatory authority shall make any adjustments necessary to
prevent over-recovery of amounts reflected in riders in effect for
the electric utility during the pendency of the rate proceeding.
(e) A utility may not assess more than one surcharge
authorized by Subsection (c)(2) at the same time.
(f) This section expires September 1, 2023.
SECTION 3. Subchapter E, Chapter 36, Utilities Code, is
amended by adding Section 36.212 to read as follows:
Sec. 36.212. RATE CASE REQUIREMENT FOR CERTAIN NON-ERCOT
UTILITIES. (a) This section applies only to an electric utility
that operates solely outside of ERCOT.
(b) The commission shall require an electric utility to make
the filings with regulatory authorities required by Subchapter B,
Chapter 33, and to file a rate-filing package under Subchapter D
with the commission to initiate a comprehensive base rate
proceeding before all of the utility's regulatory authorities:
(1) on or before the fourth anniversary of the date of
the final order in the electric utility's most recent comprehensive
base rate proceeding; or
(2) if, before the anniversary described by
Subdivision (1), the electric utility earns materially more than
the utility's authorized rate of return on investment, on a
weather-normalized basis, in the utility's two most recent
consecutive commission earnings monitoring reports.
(c) The electric utility must make the filings described by
Subsection (b) not later than the 120th day after the date the
commission notifies the utility of the requirement described by
Subsection (b). The 120-day period may be extended in the manner
provided by Section 36.153(b).
(d) The commission may extend the time period described by
Subsection (b)(1) and set a new deadline if the commission
determines that a comprehensive base rate case would not result in
materially different rates. The commission shall give interested
parties a reasonable opportunity to present materials and argument
before making a determination under this subsection.
(e) The commission shall adopt rules implementing this
section, including appropriate notice and scheduling requirements.
(f) This section does not limit the authority of a
regulatory authority under Subchapter D.
(g) This section expires September 1, 2023.
SECTION 4. Subchapter B, Chapter 37, Utilities Code, is
amended by adding Section 37.058 to read as follows:
Sec. 37.058. CERTIFICATE AND DETERMINATION ISSUED TO
CERTAIN NON-ERCOT UTILITIES FOR GENERATING FACILITY. (a) This
section applies only to an electric utility that operates solely
outside of ERCOT.
(b) An electric utility may file with the commission a
request that the commission:
(1) grant a certificate for an electric generating
facility;
(2) make a public interest determination for the
purchase of an existing electric generating facility under Section
14.101; or
(3) both grant a certificate and make a determination.
(c) Notwithstanding any other law, in a proceeding
involving the purchase of an existing electric generating facility,
the commission shall issue a final order on a certificate for the
facility or making a determination on the facility required by
Section 14.101, as applicable, not later than the 181st day after
the date a request for the certificate or determination is filed
with the commission under Subsection (b). For generating facilities
granted a certificate under this subsection, notwithstanding
Section 36.053, the utility's recoverable invested capital
included in rates shall be determined by the commission.
(d) Notwithstanding any other law, in a proceeding
involving a newly constructed generating facility, the commission
shall issue a final order on a certificate for the facility not
later than the 366th day after the date a request for the
certificate is filed with the commission under Subsection (b).
SECTION 5. The changes in law made by this Act are not
intended to affect the exercise of municipal jurisdiction under
Chapter 33, Utilities Code.
SECTION 6. The changes in law made by this Act apply only to
a proceeding before the Public Utility Commission of Texas or other
regulatory authority described by Section 11.003, Utilities Code,
that commences on or after the effective date of this Act. A
proceeding before the Public Utility Commission of Texas or other
regulatory authority described by Section 11.003, Utilities Code,
that commenced before the effective date of this Act is governed by
the law in effect on the date the proceeding commenced, and that law
is continued in effect for that purpose.
SECTION 7. 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.
______________________________ ______________________________
President of the Senate Speaker of the House
I certify that H.B. No. 1535 was passed by the House on May 4,
2015, by the following vote: Yeas 114, Nays 25, 3 present, not
voting.
______________________________
Chief Clerk of the House
I certify that H.B. No. 1535 was passed by the Senate on May
26, 2015, by the following vote: Yeas 30, Nays 1.
______________________________
Secretary of the Senate
APPROVED: _____________________
Date
_____________________
Governor