By: Price, et al. (Senate Sponsor - Schwertner) H.B. No. 2073
(In the Senate - Received from the House May 3, 2023;
May 4, 2023, read first time and referred to Committee on Business &
Commerce; May 10, 2023, reported favorably by the following vote:
Yeas 11, Nays 0; May 10, 2023, sent to printer.)
Click here to see the committee vote
COMMITTEE VOTE
YeaNayAbsentPNV
SchwertnerX
KingX
BirdwellX
CampbellX
CreightonX
JohnsonX
KolkhorstX
MenéndezX
MiddletonX
NicholsX
ZaffiriniX
A BILL TO BE ENTITLED
AN ACT
relating to the recovery of fuel and purchased power costs by
electric utilities.
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
SECTION 1. Section 36.203, Utilities Code, is amended to
read as follows:
Sec. 36.203. FUEL AND PURCHASED POWER COST RECOVERY;
ADJUSTMENT OF FUEL FACTOR. (a) Section 36.201 does not prohibit
the commission from reviewing and providing for adjustments of an
electric [a] utility's fuel factor.
(b) The commission by rule shall implement procedures that
provide for the timely adjustment of an electric [a] utility's fuel
factor[, with or without a hearing]. The rules [procedures] must
require that[:
[(1)] the findings required by Section 36.058
regarding fuel transactions with affiliated interests be [are] made
in a fuel reconciliation proceeding or in a rate case filed under
Subchapter C or D. The rules must ensure that:
(1) the utility collects as contemporaneously as
reasonably possible the electric fuel and purchased power costs
that the utility incurs and that the commission determines are
eligible;
(2) the total of the utility's eligible electric fuel
and purchased power costs, including any under-collected or
over-collected amounts to be recovered through an interim fuel
adjustment, is allocated among customer classes based on actual
historical calendar month usage;
(3) any material balance of amounts under-collected or
over-collected for eligible electric fuel and purchased power costs
is collected from or refunded to customers through an interim fuel
adjustment:
(A) not later than the 90th day after the date the
balance is accrued; or
(B) if the adjustment would result in a total
bill increase of 10 percent or more compared to the total bill in
the month before implementation, not later than a date ordered by
the commission which must be after the 90th day after the date the
balance is accrued; and
(4)[; and
[(2)] an affected party will receive notice and have
the opportunity to request a hearing before the commission.
(c) Notwithstanding Subsection (b)(3), on a finding that an
electric utility has an under-collected balance that is the result
of extraordinary electric fuel and purchased power costs that are
unlikely to continue, the commission may approve an interim fuel
adjustment that would defer recovery to take place over a period
longer than 90 days [The commission may adjust a utility's fuel
factor without a hearing if the commission determines that a
hearing is not necessary. If the commission holds a hearing, the
commission may consider at the hearing any evidence that is
appropriate and in the public interest].
(d) The commission is not required to hold a hearing on the
adjustment of an electric utility's fuel factor under this section.
If the commission holds a hearing, the commission may consider at
the hearing any evidence that is appropriate and in the public
interest [The commission shall render a timely decision approving,
disapproving, or modifying the adjustment to the utility's fuel
factor].
(e) A customer of the electric utility, a municipality with
original jurisdiction over the utility, or the office may protest a
fuel factor or interim fuel adjustment proposed under this section.
The prudence of costs may not be considered in a fuel factor or
interim fuel adjustment proceeding and may only be considered in a
fuel reconciliation proceeding under Subsection (h) or another
appropriate proceeding [The commission by rule shall provide for
the reconciliation of a utility's fuel costs on a timely basis].
(f) The sole issue that may be considered on a protest of a
fuel factor under Subsection (e) is whether the factor reasonably
reflects costs the electric utility will incur so that the utility
will not substantially under-collect or over-collect the utility's
reasonably stated fuel and purchased power costs on an ongoing
basis. The commission may adjust the utility's fuel factor based on
its determination on that issue.
(g) The commission shall hold a hearing on a protest of an
interim fuel adjustment under Subsection (e) if the adjustment
would result in a total bill increase of 10 percent or more as
described by Subsection (b)(3) or if the adjustment results from
extraordinary electric fuel and purchased power costs as described
by Subsection (c). In response to a protest of an interim fuel
adjustment, if the commission finds that the electric utility is in
a state of material under-collection or over-collection of the
utility's reasonably stated eligible fuel and purchased power costs
and is projected to remain in that state on an ongoing basis, the
commission shall order the utility to establish or modify an
interim fuel adjustment to address the under-collection or
over-collection in a manner consistent with this section.
(h) An electric utility shall apply to reconcile the
utility's electric fuel and purchased power costs at least once
every two years. The application must be made not later than the
180th day after the last day of the period to be reconciled. The
commission may by rule establish the calendar year timing of the
reconciliation period for each electric utility subject to this
section to facilitate efficient work by the commission. To the
extent a reconciliation results in a change to the electric
utility's under-collected or over-collected fuel balance, that
change may be incorporated into an interim fuel adjustment as
directed by the commission.
(i) A proceeding under this section is not a rate case under
Subchapter C.
SECTION 2. The first time an electric utility applies to
reconcile the utility's fuel costs and purchased power costs under
Section 36.203(h), Utilities Code, as added by this Act, after the
Public Utility Commission of Texas adopts the rules required to
implement that subsection, the electric utility shall include in
the application any period that has not been addressed in a previous
reconciliation proceeding.
SECTION 3. This Act takes effect September 1, 2023.
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