Texas House Bill HB1520

Texas 2021 - 87th Regular

Caption

Relating to certain extraordinary costs incurred by certain gas utilities relating to Winter Storm Uri and a study of measures to mitigate similar future costs; providing authority to issue bonds and impose fees and assessments.

Impact

If passed, HB1520 would amend existing laws to enable gas utilities to issue bonds for recouping costs related to the Winter Storm Uri crisis. This would involve establishing nonbypassable charges that all customers of the gas utilities must pay, to facilitate the repayment of these bonds. The intention is to provide financial assistance to utilities while avoiding abrupt rate hikes for consumers. Critics, however, may view this as a potential burden on consumers, as the costs could be transferred to them through these charges over time.

Summary

House Bill 1520 addresses the extraordinary costs that certain gas utilities incurred during the Winter Storm Uri event. The bill provides a framework for the issuance of customer rate relief bonds which are intended to allow gas utilities to recoup these high costs through a process known as securitization. The goal of this bill is to offer relief to customers while enabling gas utilities to recover their financial stability following the unprecedented weather event, thus ensuring that they can continue to provide reliable service. The Railroad Commission of Texas is tasked with overseeing the implementation of this bill and ensuring that the process benefits customers directly.

Sentiment

The sentiment around HB1520 is mixed. Supporters, particularly among the gas utility representatives and some legislators, argue that it provides a necessary lifeline for utilities that faced severe financial distress due to the storm's impact, and that it protects consumer interests by allowing costs to be spread out over time. In contrast, there are apprehensions from consumer advocates and some legislators who express concerns over the long-term implications of adding such charges to consumer bills, asserting that it could lead to issues of affordability and transparency.

Contention

The most notable point of contention regarding HB1520 revolves around the imposition of nonbypassable charges on consumers. While proponents argue this mechanism is crucial for recovery and maintaining gas supply, opponents question the fairness of passing on costs from the storm to consumers who may not have directly benefited from the utilities' actions during the crisis. The effectiveness of safeguards meant to ensure that the securitization financing is actually beneficial for consumers, rather than just a financial tool for utilities, remains a critical area of debate among stakeholders.