By: Hall S.B. No. 1003
A BILL TO BE ENTITLED
AN ACT
relating to promoting the resilience of the electric grid and
certain municipalities.
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
SECTION 1. The legislature finds that:
(1) A resilient Texas electric grid that offers
businesses continuity of operations in the event of a natural or
man-made disaster, including hurricanes, flooding, terrorist
attacks, cybersecurity threats, electromagnetic pulse threats, and
geomagnetic disturbance threats, will be an unrivaled attraction
for businesses to expand or move their operations to this state and
for protecting military installations;
(2) this state's food and water supplies, fuel supply,
communications systems, banking, hospitals and health care
facilities, law enforcement, and countless critical functions
depend on the electric grid, making the grid's protection vital to
our economy and homeland security;
(3) the United States Department of Homeland Security
has recommended protection against these threats and has published
Electromagnetic Pulse (EMP) Protection and Resilience Guidelines
for Critical Infrastructure and Equipment, which can be used to
mitigate the effects of such a disaster;
(4) Texas Governor Greg Abbott has outlined in his
most recent state-wide address that he is giving the legislature
time during this legislative session "to make Texas more resilient
to future disasters" by "making disaster response an emergency
item;"
(5) public confidence in the resilience of the Texas
electric grid is essential to ensuring economic prosperity,
domestic tranquility, continuity of government, and
life-sustaining systems;
(6) protection of the electric grid would assure these
businesses and the citizens of this state that the "lights will be
back on first in Texas" in the event of a catastrophic failure of
the grid;
(7) the federal government has failed to protect the
citizens of this state by addressing the vulnerability of the
electric grid;
(8) Texas is uniquely positioned to be the first state
to take action to protect its electric grid, because it is the only
state with a grid exclusively within its boundaries; and
(9) when this state begins implementation of the
electric grid resilience plan, short- and long-term economic
benefit will far exceed, even the most optimistic estimates of, the
conventional economic incentives provided by tax abatements to
attract businesses to this state.
SECTION 2. Subtitle B, Title 2, Utilities Code, is amended
by adding Chapter 44 to read as follows:
CHAPTER 44. GRID RESILIENCE
Sec. 44.001. DEFINITIONS. In this chapter:
(1) "EMP Commission reports" means the July 2017
report released by the Commission to Assess the Threat to the United
States from Electromagnetic Pulse (EMP) Attack titled "Recommended
E3 HEMP Heave Electric Field Waveform for the Critical
Infrastructures" and all other reports by the EMP Commission.
(2) "Micro-grid" means a group of interconnected loads
and distributed energy resources inside clearly defined electrical
boundaries that act as a single controllable entity with respect to
the grid.
(3) "Security commission" means the Texas Grid
Security Commission.
Sec. 44.002. TEXAS GRID SECURITY COMMISSION. (a) The
security commission is composed of the following members:
(1) a representative of the Texas Division of
Emergency Management appointed by the chief of the division;
(2) a representative of the State Office of Risk
Management appointed by the risk management board;
(3) a representative of the independent organization
certified under Section 39.151 for the ERCOT region appointed by
the chief executive officer of the organization;
(4) a representative of the Texas Military Department
appointed by the adjutant general of the department;
(5) a representative of the Texas Military
Preparedness Commission appointed by the military preparedness
commission;
(6) a representative of the Office of State-Federal
Relations appointed by the director of the office;
(7) a representative of the Department of Information
Resources appointed by the director of the department.
(8) a representative of power generation companies
appointed by the chief of the Texas Division of Emergency
Management;
(9) two representatives of transmission and
distribution utilities appointed by the chief of the Texas Division
of Emergency Management;
(10) one representative appointed by the chief of the
Texas Division of Emergency Management from each of the following
essential services sectors:
(A) law enforcement;
(B) emergency services;
(C) communications;
(D) water and sewer services;
(E) health care;
(F) financial services; and
(G) food and agriculture;
(11) an expert in the field of higher education
appointed by the chief of the Texas Division of Emergency
Management.
(b) The chief of the Texas Division of Emergency Management
may appoint a member of the United States Air Force's
Electromagnetic Defense Task Force to the security commission.
(c) The Texas Division of Emergency Management shall
designate a member of the security commission to serve as presiding
officer.
(d) The security commission shall convene at the call of the
presiding officer.
(e) A vacancy on the security commission is filled by
appointment for the unexpired term in the same manner as the
original appointment.
Sec. 44.003. GRID RESILIENCE INFORMATION. (a) Information
used in determining the vulnerabilities of the electric grid or
that is related to measures to be taken to protect the grid is
confidential and not subject to Chapter 552, Government Code.
(b) Information described by Subsection (a) shall be stored
and maintained by the independent organization certified under
Section 39.151 for the ERCOT region.
(c) A member of the security commission may not access
confidential information described by Subsection (a) unless the
member has a secret security clearance granted by the federal
government.
(d) The following members of the security commission may
apply for a secret security clearance or an interim secret security
clearance to be granted by the federal government:
(1) the representative of the independent
organization certified under Section 39.151 for the ERCOT region;
(2) the representative of the Texas Division of
Emergency Management; and
(3) the representative of the State Office of Risk
Management.
Sec. 44.004. CRITICAL COMPONENT RESILIENCE. (a) The State
Office of Risk Management shall select a contractor to identify
critical components of the ERCOT electric grid vulnerable to EMP,
GMD, cyber, or physical attack. The contractor must identify the
critical components before the expiration of six months after the
date the contractor is engaged.
(b) Not later than January 1, 2021, an entity that owns or
operates a component identified by the contractor under Subsection
(a) as critical shall upgrade the component as necessary for the
component to meet the applicable standard proposed in the EMP
Commission reports.
(c) The State Office of Risk Management shall select a
contractor to verify whether affected entities have upgraded
components as required by Subsection (b).
(d) Each contractor selected by the State Office of Risk
Management under this section must have experience hardening
electrical systems to meet military standards at the federal level.
Sec. 44.005. PLAN FOR CONTINUITY OF SERVICES. (a) Not
later than January 1, 2020, the security commission shall prepare
and deliver to the legislature a plan for continuity of services in
the event of a catastrophic loss of power in the state.
(b) The plan must include:
(1) provisions for installing, replacing, or
upgrading extra high-voltage power transformers and supervisory
control and data acquisition systems to withstand 100
kilovolts/meter E1 electromagnetic pulses and 85 volts/kilometer
E3 electromagnetic pulses not later than January 1, 2024;
(2) a timeline for upgrading remaining infrastructure
to meet recommendations of the EMP Commission reports; and
(3) long-term resilience provisions for supporting
industries including:
(A) nuclear reactors, materials, and waste
(B) fuel supply;
(C) health care;
(D) communications;
(E) water and sewer services; and
(F) food supply; and
(4) any additional provisions deemed necessary by the
security commission.
(c) The security commission may consult with the Private
Sector Advisory Council in developing the plan.
(d) The Texas Division of Emergency Management shall
incorporate the plan into the state emergency management plan and
update the plan as necessary to incorporate the progressive
improvement of the system.
Sec. 44.006. ALTERNATIVE TIMELINE OR STANDARD. A panel
composed of members of the security commission who have obtained a
secret security clearance granted by the federal government may
approve a resilience standard or implementation timeline for an
electric utility or other entity that differs from a resilience
standard or implementation timeline adopted under Section 44.005.
Sec. 44.007. RESILIENCE COST RECOVERY. A regulatory
authority shall include in establishing the rates of an electric
utility consideration of the costs incurred to install, replace, or
upgrade facilities or equipment to meet a resilience standard
established under this chapter. A regulatory authority shall
presume that costs incurred to meet a resilience standard under
this chapter are reasonable and necessary expenses.
Sec. 44.008. MICRO-GRIDS. (a) The security commission
shall establish resilience standards for micro-grids and certify a
micro-grid that meets the standards.
(b) Except as provided by Subsection (c), a municipality or
other political subdivision may not enact or enforce an ordinance
or other measure that bans, limits, or otherwise regulates inside
the boundaries or extraterritorial jurisdiction of the
municipality or political subdivision a micro-grid that is
certified by the security commission under this section.
(c) The owner or operator of a micro-grid certified by the
security commission is a power generation company and is required
to register under Section 39.351(a). The owner or operator of the
micro-grid is entitled to:
(1) interconnect the micro-grid;
(2) obtain transmission service for the micro-grid;
and
(3) use the micro-grid to sell electricity and
ancillary services at wholesale in a manner consistent with the
provisions of this title and commission rules applicable to a power
generation company or an exempt wholesale generator.
SECTION 3. Chapter 380, Local Government Code, is amended
by adding Section 380.004 to read as follows:
Sec. 380.004. FIVE STAR GOLD RESILIENT COMMUNITIES.
(a) An Energy Resilient Community is one where provisions
have been made to ensure that energy, electric power,
and fuel supplies are protected and available for
recovery in the event of a catastrophic power outage.
(b) The Texas Grid Security Commission shall establish
resilience standards for municipalities in the following essential
service areas:
(1) emergency services;
(2) communications systems;
(3) clean water and sewer services;
(4) health care systems; and
(5) financial services.
(c) On the application of a municipality for the
designation, the Texas Grid Security Commission may designate a
municipality that meets the resilience standards in the applicable
service area as:
(1) a Resilient Emergency Services Community;
(2) a Resilient Communications Systems Community;
(3) a Resilient Clean Water and Sewer Services
Community;
(4) a Resilient Health Care Systems Community; or
(5) a Resilient Financial Services Community.
(d) The Texas Grid Security Commission may designate a
municipality that meets the resilience standards in all five
service areas as a Five Star Gold Resilient Community.
(d) A municipality may not use a resilient community
designation in advertising, marketing, or economic development
initiatives unless the Texas Grid Security Commission has awarded
the municipality with the designation in the applicable service
area or as a Five Star Gold Resilient Community.
SECTION 4. Not later than January 1, 2021, the Texas Grid
Security Commission shall prepare and deliver a report to the
legislature on the progress of implementing resilience standards
adopted under Sections 44.004 and 44.005, Utilities Code, as added
by this Act.
SECTION 5. 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 II, Texas Constitution. If this Act
does not receive the vote necessary for immediate effect, this Act
takes effect September 1, 2019.