2019S0319-1 03/01/19
By: Hancock S.B. No. 1941
A BILL TO BE ENTITLED
AN ACT
relating to the use of electric energy storage facilities in the
ERCOT power region.
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
SECTION 1. Section 35.151, Utilities Code, is amended to
read as follows:
Sec. 35.151. ELECTRIC ENERGY STORAGE. (a) This subchapter
applies to electric energy storage equipment or facilities that are
intended to provide energy or ancillary services at wholesale,
including electric energy storage equipment or facilities listed on
a power generation company's registration with the commission or,
for an exempt wholesale generator, on the generator's registration
with the Federal Energy Regulatory Commission.
(b) This subchapter does not apply to ownership or operation
of electric energy storage equipment or facilities outside of
ERCOT.
SECTION 2. Subchapter E, Chapter 35, Utilities Code, is
amended by adding Section 35.153 to read as follows:
Sec. 35.153. USE OF ELECTRIC ENERGY STORAGE FACILITIES FOR
DISTRIBUTION SYSTEM RELIABILITY. (a) With prior approval by the
commission and to ensure reliable service to retail customers, a
transmission and distribution utility may enter into an agreement
with a power generation company to provide electricity from an
energy storage facility.
(b) An agreement under Subsection (a) is limited to
situations where construction of traditional distribution
facilities is not cost-effective when compared to the use of an
energy storage facility.
(c) A transmission and distribution utility must issue a
request for proposals to provide electricity from an energy storage
facility to meet specific reliability needs.
(d) The energy storage facility may be used to offer or sell
electric energy or ancillary services so long as the power
generation company reserves the capacity required by the agreement
with the transmission and distribution utility.
(e) The energy storage facility may be discharged for
reliability purposes only when and as directed by the transmission
and distribution utility.
(f) An agreement under Subsection (a) may provide that the
energy storage facility owner will reimburse the transmission and
distribution utility for an administrative penalty the commission
assessed because the facility failed to meet the requirements of
the agreement.
(g) An agreement between a transmission and distribution
utility and a power generation company that owns an energy storage
facility shall be reviewed in a proceeding under Chapter 36. The
transmission and distribution utility has the burden of
establishing that the agreement, including associated costs, is
reasonable and necessary.
(h) If a transmission and distribution utility issues a
request for proposals to provide electricity from an energy storage
facility to meet specific reliability needs and does not receive an
offer that meets the requirements of the request for proposals,
then, with prior approval by the commission, the transmission and
distribution utility may own and operate an energy storage facility
to ensure reliable delivery of electricity to retail customers.
The total amount of energy storage capacity owned by a single
transmission and distribution utility for this purpose may not
exceed 10 megawatts.
(i) A transmission and distribution utility that owns or
operates an energy storage facility in accordance with Subsection
(h) must purchase the energy to charge the facility from a retail
electric provider and sell the energy discharged from the energy
storage device to the same retail electric provider.
(j) An energy storage facility described by Subsection (h)
may not be used to offer or sell electric energy or ancillary
services except for sales to the retail electric provider that
serves the transmission and distribution utility's energy storage
facility when needed to ensure reliable service to retail
customers.
(k) A transmission and distribution utility that owns or
operates an energy storage facility in accordance with Subsection
(h) is not a power generation company.
(l) The commission shall adopt rules establishing criteria:
(1) for agreements under Subsection (a), which must
include the requirements of Subsections (b)-(f); and
(2) for ownership and operation of energy storage
facilities by transmission and distribution utilities under
Subsection (h), including the recovery of associated costs.
SECTION 3. The Public Utility Commission of Texas shall
adopt rules required under Section 35.153, Utilities Code, as added
by this Act, as soon as practicable after the effective date of this
Act.
SECTION 4. This Act takes effect September 1, 2019.