Texas 2023 - 88th Regular

Texas House Bill HB2555 Compare Versions

Version 1 (Old)

Version 2 (New)

Old	New	Differences
1	1	H.B. No. 2555
2	2
3	3
4	4	AN ACT
5	5	relating to transmission and distribution system resiliency
6	6	planning by and cost recovery for electric utilities.
7	7	BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
8	8	SECTION 1. The legislature finds that:
9	9	(1) extreme weather conditions, including high winds,
10	10	lightning, flooding, and freezes, can cause extraordinary damage to
11	11	electrical transmission and distribution facilities, resulting in
12	12	power outages;
13	13	(2) it is in the state's interest to promote the use of
14	14	resiliency measures to enable electrical transmission and
15	15	distribution infrastructure to withstand extreme weather
16	16	conditions, including hardening electrical transmission and
17	17	distribution facilities, undergrounding certain electrical
18	18	distribution lines, lightning mitigation measures, flood
19	19	mitigation measures, information technology, cybersecurity
20	20	measures, physical security measures, vegetation management, and
21	21	wildfire mitigation and response;
22	22	(3) protecting electrical transmission and
23	23	distribution infrastructure from extreme weather conditions can
24	24	effectively reduce system restoration costs to and outage times for
25	25	customers and improve system resiliency and overall service
26	26	reliability for customers;
27	27	(4) it is in the state's interest for each electric
28	28	utility to seek to mitigate system restoration costs to and outage
29	29	times for customers when developing plans to enhance electrical
30	30	transmission and distribution infrastructure storm resiliency; and
31	31	(5) all customers benefit from reduced system
32	32	restoration costs.
33	33	SECTION 2. Subchapter D, Chapter 38, Utilities Code, is
34	34	amended by adding Section 38.078 to read as follows:
35	35	Sec. 38.078. TRANSMISSION AND DISTRIBUTION SYSTEM
36	36	RESILIENCY PLAN AND COST RECOVERY. (a) In this section, "plan"
37	37	means a transmission and distribution system resiliency plan
38	38	described by Subsection (b).
39	39	(b) An electric utility may file, in a manner authorized by
40	40	commission rule, a plan to enhance the resiliency of the utility's
41	41	transmission and distribution system through at least one of the
42	42	following methods:
43	43	(1) hardening electrical transmission and
44	44	distribution facilities;
45	45	(2) modernizing electrical transmission and
46	46	distribution facilities;
47	47	(3) undergrounding certain electrical distribution
48	48	lines;
49	49	(4) lightning mitigation measures;
50	50	(5) flood mitigation measures;
51	51	(6) information technology;
52	52	(7) cybersecurity measures;
53	53	(8) physical security measures;
54	54	(9) vegetation management; or
55	55	(10) wildfire mitigation and response.
56	56	(c) A plan must explain the systematic approach the electric
57	57	utility will use to carry out the plan during at least a three-year
58	58	period.
59	59	(d) In determining whether to approve a plan filed under
60	60	this section, the commission shall consider:
61	61	(1) the extent to which the plan is expected to enhance
62	62	system resiliency, including whether the plan prioritizes areas of
63	63	lower performance; and
64	64	(2) the estimated costs of implementing the measures
65	65	proposed in the plan.
66	66	(e) The commission shall issue an order to approve, modify,
67	67	or deny a plan filed under Subsection (b) and any associated rider
68	68	described by Subsection (i) not later than the 180th day after the
69	69	plan is filed with the commission. The commission may approve a
70	70	plan only if the commission determines that approving the plan is in
71	71	the public interest.
72	72	(f) For a plan approved by the commission, with or without
73	73	modification, an electric utility may request a good cause
74	74	exception on implementing all or some of the measures in the plan if
75	75	operational needs, business needs, financial conditions, or supply
76	76	chain or labor conditions dictate the exception. The commission's
77	77	denial of a plan is not considered to be a finding of the prudence or
78	78	imprudence of a measure or cost in the plan for the purposes of
79	79	Chapter 36 or this chapter.
80	80	(g) An electric utility for which the commission has
81	81	approved a plan under this section may request that the commission
82	82	review an updated plan submitted by the electric utility. The
83	83	updated plan must comply with any applicable commission rules and
84	84	take effect on a date that is not earlier than the third anniversary
85	85	of the approval date of the utility's most recently approved plan.
86	86	The commission shall review and approve, modify, or deny the
87	87	updated plan in the manner provided by Subsections (d), (e), and
88	88	(f).
89	89	(h) An electric utility's implementation of a plan approved
90	90	under this section may be reviewed for the purposes of Chapter 36 or
91	91	this chapter. If the commission determines that the costs to
92	92	implement an approved plan were imprudently incurred or otherwise
93	93	unreasonable, those costs are subject to disallowance.
94	94	(i) Notwithstanding any other law, an electric utility may
95	95	file with a plan an application for a rider to recover the electric
96	96	utility's distribution investment that is made to implement a plan
97	97	and is used and useful to the electric utility in providing service
98	98	to the public. The electric utility may file the application before
99	99	the electric utility places into service the distribution
100	100	investment to implement an approved plan. The commission may
101	101	approve the rider application before the electric utility places
102	102	into service the distribution investment to implement an approved
103	103	plan. The commission may not approve a rider that would allow an
104	104	electric utility to begin recovering the distribution investment
105	105	before the utility begins to use the investment to provide service
106	106	to the public. If the commission approves or modifies the plan, the
107	107	commission shall determine the appropriate terms of the rider in
108	108	the approval order. The commission shall adopt a procedure for
109	109	reconciliation of an electric utility's distribution-related costs
110	110	to implement an approved plan.
111	111	(j) As part of a review described by Subsection (g), the
112	112	commission shall reconcile the rider authorized under Subsection
113	113	(i) to determine the electric utility's reasonably and prudently
114	114	incurred plan costs.
115	115	(k) If an electric utility that files a plan with the
116	116	commission does not apply for a rider under Subsection (i), after
117	117	commission review, the utility may defer all or a portion of the
118	118	distribution-related costs relating to the implementation of the
119	119	plan for future recovery as a regulatory asset, including
120	120	depreciation expense and carrying costs at the utility's weighted
121	121	average cost of capital established in the commission's final order
122	122	in the utility's most recent base rate proceeding in a manner
123	123	consistent with Chapter 36, and use commission authorized cost
124	124	recovery alternatives under Sections 36.209 and 36.210 or another
125	125	general rate proceeding.
126	126	(l) Plan costs considered by the commission to be reasonable
127	127	and prudent may include only incremental costs that are not already
128	128	being recovered through the electric utility's base rates or any
129	129	other rate rider and must be allocated to customer classes pursuant
130	130	to the rate design most recently approved by the commission.
131	131	SECTION 3. The Public Utility Commission of Texas shall
132	132	adopt rules to implement Section 38.078, Utilities Code, as added
133	133	by this Act, not later than the 180th day after the effective date
134	134	of this Act.
135	135	SECTION 4. This Act takes effect immediately if it receives
136	136	a vote of two-thirds of all the members elected to each house, as
137	137	provided by Section 39, Article III, Texas Constitution. If this
138	138	Act does not receive the vote necessary for immediate effect, this
139	139	Act takes effect September 1, 2023.
140	140	______________________________ ______________________________
141	141	President of the Senate Speaker of the House
142	142	I certify that H.B. No. 2555 was passed by the House on April
143	143	28, 2023, by the following vote: Yeas 147, Nays 0, 1 present, not
144	144	voting; and that the House concurred in Senate amendments to H.B.
145	145	No. 2555 on May 25, 2023, by the following vote: Yeas 134, Nays 7,
146	146	2 present, not voting.
147	147	______________________________
148	148	Chief Clerk of the House
149	149	I certify that H.B. No. 2555 was passed by the Senate, with
150	150	amendments, on May 17, 2023, by the following vote: Yeas 29, Nays
151	151	2.
152	152	______________________________
153	153	Secretary of the Senate
154	154	APPROVED: __________________
155	155	Date
156	156	__________________
157	157	Governor