By: Paddie, et al. (Senate Sponsor - Schwertner) H.B. No. 10
(In the Senate - Received from the House March 31, 2021;
April 8, 2021, read first time and referred to Committee on
Jurisprudence; May 22, 2021, reported adversely, with favorable
Committee Substitute by the following vote: Yeas 5, Nays 0;
May 22, 2021, sent to printer.)
Click here to see the committee vote
COMMITTEE SUBSTITUTE FOR H.B. No. 10 By: Hinojosa
A BILL TO BE ENTITLED
AN ACT
relating to the governance of the Public Utility Commission of
Texas, the Office of Public Utility Counsel, and an independent
organization certified to manage a power region.
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
SECTION 1. Section 12.051(a), Utilities Code, is amended to
read as follows:
(a) The commission is composed of five [three]
commissioners appointed by the governor with the advice and consent
of the senate.
SECTION 2. Section 12.053, Utilities Code, is amended by
amending Subsections (a) and (b) and adding Subsection (a-1) to
read as follows:
(a) To be eligible for appointment, a commissioner must:
(1) be a qualified voter;
(2) be a citizen of the United States;
(3) be a resident of this state;
(4) be a competent and experienced administrator;
[(4) be well informed and qualified in the field of
public utilities and utility regulation;] and
(5) have at least five years of experience:
(A) in the administration of business or
government; or
(B) as a practicing attorney, [or] certified
public accountant, or professional engineer.
(a-1) At least two commissioners must be well informed and
qualified in the field of public utilities and utility regulation.
(b) A person is not eligible for appointment as a
commissioner if the person:
(1) at any time during the one year [two years]
preceding appointment:
(A) personally served as an officer, director,
owner, employee, partner, or legal representative of a public
utility regulated by the commission or of an affiliate or direct
competitor of a public utility regulated by the commission; [or]
(B) owned or controlled, directly or indirectly,
more than a 10 percent interest in a public utility regulated by the
commission or in an affiliate or direct competitor of a public
utility regulated by the commission; or
(C) served as an executive officer listed under
Section 1, Article IV, Texas Constitution, other than the secretary
of state, or a member of the legislature; or
(2) is not qualified to serve under Section 12.151,
12.152, or 12.153.
SECTION 3. Section 13.022(a), Utilities Code, is amended to
read as follows:
(a) The counsellor must:
(1) be licensed to practice law in this state and a
resident of this state;
(2) have demonstrated a strong commitment to and
involvement in efforts to safeguard the rights of the public; and
(3) possess the knowledge and experience necessary to
practice effectively in utility proceedings.
SECTION 4. Section 39.151, Utilities Code, is amended by
amending Subsections (d), (g), and (g-1) and adding Subsections
(g-2), (g-3), and (g-4) to read as follows:
(d) The commission shall adopt and enforce rules relating to
the reliability of the regional electrical network and accounting
for the production and delivery of electricity among generators and
all other market participants, or may delegate to an independent
organization responsibilities for adopting [establishing] or
enforcing such rules. Rules [Any such rules] adopted by an
independent organization and [any] enforcement actions taken by the
organization under delegated authority from the commission are
subject to commission oversight and review and may not take effect
before receiving commission approval. An independent organization
certified by the commission is directly responsible and accountable
to the commission. The commission has complete authority to
oversee and investigate the organization's finances, budget, and
operations as necessary to ensure the organization's
accountability and to ensure that the organization adequately
performs the organization's functions and duties. The organization
shall fully cooperate with the commission in the commission's
oversight and investigatory functions. The commission may take
appropriate action against an organization that does not adequately
perform the organization's functions or duties or does not comply
with this section, including decertifying the organization or
assessing an administrative penalty against the organization. The
commission by rule shall adopt procedures governing
decertification of an independent organization, selecting and
certifying a successor organization, and transferring assets to the
successor organization to ensure continuity of operations in the
region. The commission may not implement, by order or by rule, a
requirement that is contrary to an applicable federal law or rule.
(g) To maintain certification as an independent
organization under this section, an organization's governing body
must be composed of persons specified by this section and selected
in accordance with formal bylaws or protocols of the organization.
The bylaws or protocols must be approved by the commission and must
reflect the input of the commission. The bylaws must specify the
process by which appropriate stakeholders elect members and, for
unaffiliated members, prescribe professional qualifications for
selection as a member. The bylaws must require that every member of
the governing body be a resident of this state and prohibit a
legislator from serving as a member. The bylaws may require the use
of a professional search firm to identify candidates for
[membership of unaffiliated] members described by Subdivisions
(4), (5), and (6). The process must allow for commission input in
identifying candidates. The governing body must be composed of:
(1) the chairman of the commission as an ex officio
nonvoting member;
(2) the counsellor as an ex officio voting member
representing residential and small commercial consumer interests;
(3) the chief executive officer of the independent
organization as an ex officio voting member, who must be appointed
by the governor with the advice and consent of the senate;
(4) six market participants elected by their
respective market segments to serve two-year [one-year] terms,
with:
(A) one representing independent generators,
elected by a majority vote of the members of this market segment who
each own and control five percent or more of the installed
generation capacity located in the power region;
(B) one representing investor-owned utilities;
(C) one representing power marketers;
(D) one representing retail electric providers
who may not be affiliated with an independent generator;
(E) one representing municipally owned
utilities; and
(F) one representing electric cooperatives;
(5) one member representing industrial consumer
interests and elected by the industrial consumer market segment to
serve a two-year [one-year] term;
(6) one member representing large commercial consumer
interests selected in accordance with the bylaws to serve a
two-year [one-year] term; and
(7) five members unaffiliated with any market segment
who must be appointed by the governor with the advice and consent of
the senate [and selected by the other members of the governing body]
to serve two-year [three-year] terms.
(g-1) The bylaws of an independent organization must
require that the [The] presiding officer and vice presiding officer
of the governing body must be:
(1) [one of the] members described by Subsection
(g)(7); and
(2) selected by the governor with the advice and
consent of the senate.
(g-2) A person does not qualify for appointment as a member
of the governing body of an independent organization under
Subsection (g)(3) or (7) if the person is required to register as a
lobbyist under Chapter 305, Government Code. In making an
appointment under Subsection (g)(3) or (7), the governor:
(1) shall give preference to a person who has
executive-level business experience representing a range of
industries; and
(2) may consider a person recommended by the
legislature.
(g-3) Members of the governing body of an independent
organization certified under this section must serve staggered
terms. A member described by Subsection (g)(4) or (5) must serve a
term that expires in an even-numbered year. A member described by
Subsection (g)(6) or (7) must serve a term that expires in an
odd-numbered year. As soon as practicable after the date a member
of the governing body's term expires, the appropriate authority
must appoint or arrange for the election of a replacement in the
same manner as the original appointment or election. If a vacancy
occurs on the governing body, the appropriate authority must
appoint or arrange for the election of a successor in the same
manner as the original appointment or election to serve for the
remainder of the unexpired term.
(g-4) To maintain certification as an independent
organization under this section, the organization's governing body
must establish and implement a formal process for adopting new
protocols or revisions to existing protocols. The process must
require that new or revised protocols may not take effect until the
commission approves a market impact statement describing the new or
revised protocols.
SECTION 5. In making appointments of commissioners to the
Public Utility Commission of Texas under Section 12.051, Utilities
Code, as amended by this Act, the governor shall assign staggered
terms to the commissioners appointed to fill vacancies and to the
commissioners appointed to new positions to ensure that the
requirements of Section 30a, Article XVI, Texas Constitution, are
met.
SECTION 6. An independent organization certified under
Section 39.151, Utilities Code, by the Public Utility Commission of
Texas before September 1, 2021, shall modify the organization to
comply with Section 39.151, Utilities Code, as amended by this Act,
not later than September 1, 2021. After September 1, 2021, the
Public Utility Commission of Texas may decertify an independent
organization that does not comply with Section 39.151, Utilities
Code, as amended by this Act.
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, 2021.
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