86R7820 JXC-F
By: Buckingham S.B. No. 1098
A BILL TO BE ENTITLED
AN ACT
relating to rates for electricity charged by certain municipally
owned utilities and to the use of revenue from the rates.
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
SECTION 1. Subchapter B, Chapter 40, Utilities Code, is
amended by adding Section 40.0521 to read as follows:
Sec. 40.0521. RATES OF AND USE OF REVENUE BY CERTAIN
UTILITIES NOT OFFERING CUSTOMER CHOICE. (a) This section applies
only to a municipally owned utility that provides service in the
Capitol complex, as defined by Section 443.0071, Government Code.
(b) This section does not require a municipally owned
utility to implement or opt for customer choice.
(c) In the case of a conflict between this section and
another provision of law, this section prevails.
(d) A municipally owned utility may not directly or
indirectly subsidize wholesale competitive activities through
rates charged for the provision of retail electric service that
include fixed or variable costs reasonably attributable to the
operation and maintenance of municipally owned utility assets that
generate energy for sale at wholesale.
(e) The commission by rule shall require a municipally owned
utility to submit to the commission information to allow the
commission to determine whether the municipally owned utility is
complying with the requirements of Subsection (d). The commission
shall notify the municipal governing body or body vested with the
power to manage and operate a municipally owned utility if the
commission determines that the municipally owned utility is not
complying with the requirements of Subsection (d).
(f) A municipal governing body or a body vested with the
power to manage and operate a municipally owned utility that
receives notice from the commission under Subsection (e):
(1) shall require the municipally owned utility to
comply with Subsection (d); and
(2) may, in a manner consistent with Section
40.055(a)(4), reasonably determine the amount of the municipally
owned utility's stranded investment and calculate and establish for
the municipally owned utility a non-bypassable charge reflecting
stranded costs properly attributable to the municipally owned
utility's retail electric service customers.
(g) The relevant date for identifying stranded investment
under Subsection (f) is November 30, 2010, instead of the date
specified in Section 40.055(a)(4). The amount and duration of the
charge under Subsection (f) must:
(1) be calculated in a similar manner to that
prescribed by Subchapter F, Chapter 39;
(2) include the calculation of nuclear
decommissioning costs as allowed by Sections 39.205 and 39.206; and
(3) consider the municipally owned utility's capital
and debt structure.
(h) A person affected by a determination made under this
section by a municipal governing body or a body vested with the
power to manage and operate a municipally owned utility may appeal
the determination to the commission by filing with the commission a
petition for review not later than the 30th day after the date of
the determination. An appeal under this section is de novo. The
commission shall enter a final order:
(1) approving the determination of the municipal
governing body or the body vested with the power to manage and
operate the municipally owned utility; or
(2) substituting the commission's own determination.
(i) A municipally owned utility may use the net proceeds of
its wholesale competitive activities for any purpose deemed
appropriate by the municipal governing body or a body vested with
the power to manage and operate the municipally owned utility.
Those purposes may include utility debt repayment, reduction of
purchased power costs, or transfers to the general fund. The
municipally owned utility shall:
(1) document and book the underlying transactions in
auditable form; and
(2) on at least an annual basis as part of the
budgeting process, disclose to the public the net amount of the
proceeds and the intended uses of the proceeds.
SECTION 2. A municipally owned utility described by Section
40.0521, Utilities Code, as added by this Act, that directly or
indirectly subsidizes competitive activities through rates charged
for the provision of retail electric service on the effective date
of this Act shall comply with Section 40.0521, Utilities Code, as
added by this Act, not later than March 1, 2020.
SECTION 3. This Act takes effect September 1, 2019.