88R8944 JXC-F
By: Guillen H.B. No. 2973
A BILL TO BE ENTITLED
AN ACT
relating to facilities and construction machinery used to respond
to power outages.
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
SECTION 1. Section 39.918, Utilities Code, is amended to
read as follows:
Sec. 39.918. UTILITY FACILITIES FOR RESPONDING TO
SIGNIFICANT [POWER RESTORATION AFTER WIDESPREAD] POWER
OUTAGE. (a) In this section, "significant ["widespread] power
outage" means an event that [results in]:
(1) results in a loss of electric power that:
(A) affects a significant number of distribution
customers of a transmission and distribution utility, creates a
risk to public health or safety,[;] and
[(B)] has lasted or is expected to last for at
least six [eight] hours;
(B) affects distribution customers of a
transmission and distribution utility in an area for which the
governor has issued a disaster or emergency declaration;
(C) affects customers served by a radial
transmission or distribution facility, creates a risk to public
health or safety, and has lasted or is expected to last for at least
twelve hours; or
(D) creates [and
[(2)] a risk to public health or safety because it
affects a critical infrastructure facility, hospital, health care
facility, law enforcement facility, fire station, or water or
wastewater facility; or
(2) causes the independent system operator to order a
transmission and distribution utility to shed load.
(a-1) The Texas Division of Emergency Management, the
independent organization certified under Section 39.151 for the
ERCOT power region, or the executive director of the commission may
determine that a power outage other than an outage described by
Subsection (a) is a significant power outage for the purposes of
this section.
(b) Notwithstanding any other provision of this subtitle, a
transmission and distribution utility may:
(1) lease or own and operate facilities that provide
temporary emergency electric energy to aid in providing power to
the utility's distribution customers when a significant power
outage is imminent or restoring power to the utility's distribution
customers during a significant [widespread] power outage [in which:
[(A) the independent system operator has ordered
the utility to shed load; or
[(B) the utility's distribution facilities are
not being fully served by the bulk power system under normal
operations]; and
(2) procure, own, and operate, or enter into a
cooperative agreement with other transmission and distribution
utilities to procure, own, and operate jointly, transmission and
distribution facilities that have a lead time of at least six months
and would aid in restoring power to the utility's distribution
customers following a significant [widespread] power outage.
(b-1) In this section, long lead time facilities described
by Subsection (b) may not be electric energy storage equipment or
facilities described by [under] Chapter 35[, Utilities Code].
(c) A transmission and distribution utility that [leases
and] operates a facility [facilities] under Subsection (b)(1) may
not sell electric energy or ancillary services from the facility
[those facilities].
(d) A facility [Facilities] described by Subsection (b)(1):
(1) must be operated in isolation from the bulk power
system; and
(2) may not be included in independent system
operator:
(A) locational marginal pricing calculations;
(B) pricing; or
(C) reliability models.
(e) A transmission and distribution utility that [leases
and] operates a facility [facilities] under Subsection (b)(1) shall
ensure, to the extent reasonably practicable, that retail customer
usage during operation of the facility [those facilities] is
adjusted out of the usage reported for billing purposes by the
retail customer's retail electric provider.
(f) A transmission and distribution utility shall, when
reasonably practicable, use a competitive bidding process to lease
a facility [facilities] under Subsection (b)(1).
(g) A transmission and distribution utility that leases or
owns and operates facilities under Subsection (b)(1) or that
procures, owns, and operates facilities under Subsection (b)(2)
shall include in the utility's emergency operations plan filed with
the commission, as described by Section 186.007, a detailed plan on
the utility's use of those facilities.
(h) The commission shall allow [permit]:
(1) a transmission and distribution utility that
leases or owns and operates facilities under Subsection (b)(1) to
recover the reasonable and necessary costs of leasing or owning and
operating the facilities, including the present value of future
payments required under a [the] lease, using the rate of return on
investment established in the commission's final order in the
utility's most recent base rate proceeding; and
(2) a transmission and distribution utility that
procures, owns, and operates facilities under Subsection (b)(2) to
recover the reasonable and necessary costs of procuring, owning,
and operating the facilities, using the rate of return on
investment established in the commission's final order in the
utility's most recent base rate proceeding.
(i) The commission shall authorize a transmission and
distribution utility to defer for recovery in a future ratemaking
proceeding the incremental operations and maintenance expenses and
the return, not otherwise recovered in a rate proceeding,
associated with the leasing, [or] procurement, ownership, and
operation of the facilities.
(j) A transmission and distribution utility may request
recovery of the reasonable and necessary costs of leasing, [or]
procuring, owning, or [and] operating facilities under this
section, including any deferred expenses, through an expedited
periodic rate adjustment [a] proceeding under Section 36.210 or in
another ratemaking proceeding. The commission may review costs
recovered through a periodic rate adjustment in the following base
rate proceeding and order refunds to customers if appropriate.
(k) A transmission and distribution utility requesting cost
recovery under Subsection (j) is entitled to select whether the
costs are considered to be distribution substation equipment costs
or distribution transformer costs unless the commission has found
in a previous base rate proceeding for the utility that temporary
emergency electric energy costs should be categorized in a
different manner. A lease under Subsection (b)(1) must be treated
as a capital lease or finance lease for ratemaking purposes.
(l) The fact that the commission has not previously approved
a facility operated under this section or a cost of leasing,
procuring, owning, or operating a facility under this section is
not grounds for dismissal of the facility or the cost from a
proceeding under Section 36.210 or another ratemaking proceeding.
(m) If the capacity of facilities a transmission and
distribution utility operates under Subsection (b)(1) is less than
or equal to three percent of the utility's historical peak load, the
commission shall find that:
(1) the facilities are used and useful to the utility
in providing service; and
(2) the costs of leasing or owning and operating the
facilities are prudent, reasonable, and necessary.
[(k) This section expires September 1, 2029.]
SECTION 2. Section 502.146(b), Transportation Code, is
amended to read as follows:
(b) An owner is not required to register a vehicle that is
used only temporarily on the highways if the vehicle is:
(1) a farm trailer or farm semitrailer with a gross
weight of more than 4,000 pounds but not more than 34,000 pounds
that is used exclusively:
(A) to transport seasonally harvested
agricultural products or livestock from the place of production to
the place of processing, market, or storage;
(B) to transport farm supplies from the place of
loading to the farm; or
(C) for the purpose of participating in equine
activities or attending livestock shows, as defined by Section
87.001, Civil Practice and Remedies Code;
(2) machinery used exclusively for the purpose of
drilling water wells;
(3) oil well servicing or drilling machinery and if at
the time of obtaining the license plates, the applicant submits
proof that the applicant has a permit under Section 623.142; or
(4) construction machinery, including construction
machinery that is:
(A) owned by a transmission and distribution
utility as defined by Section 31.002, Utilities Code; and
(B) used to maintain or repair electrical lines
or substations in response to a power outage.
SECTION 3. The changes in law made by this Act apply only to
a proceeding before the Public Utility Commission of Texas, or
other regulatory authority described by Section 11.003, Utilities
Code, that commences on or after the effective date of this Act. A
proceeding before the Public Utility Commission of Texas or other
regulatory authority described by Section 11.003, Utilities Code,
that commenced before the effective date of this Act is governed by
the law in effect on the date the proceeding commenced, and that law
is continued in effect for that purpose.
SECTION 4. To the extent of any conflict, this Act prevails
over another Act of the 88th Legislature, Regular Session, 2023,
relating to nonsubstantive additions to and corrections in enacted
codes.
SECTION 5. This Act takes effect September 1, 2023.