Texas 2023 - 88th Regular

Texas House Bill HB3239 Compare Versions

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1	1	88R10513 JXC-F
2	2	By: Hernandez H.B. No. 3239
3	3
4	4
5	5	A BILL TO BE ENTITLED
6	6	AN ACT
7	7	relating to the participation of distributed energy resources in
8	8	the ERCOT ancillary services and wholesale energy markets.
9	9	BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
10	10	SECTION 1. Section 31.002, Utilities Code, is amended by
11	11	adding Subdivision (4-c) and amending Subdivisions (10) and (17) to
12	12	read as follows:
13	13	(4-c) "Distributed energy resource" means a resource
14	14	that:
15	15	(A) is capable of providing energy, providing
16	16	ancillary services, or providing both energy and ancillary
17	17	services;
18	18	(B) is operated in parallel with and is connected
19	19	to the distribution system at a voltage of less than 60 kilovolts;
20	20	and
21	21	(C) has an installed capacity of more than 100
22	22	kilowatts and less than 10 megawatts.
23	23	(10) "Power generation company" means a person,
24	24	including a person who owns or operates a distributed natural gas
25	25	generation facility, that:
26	26	(A) generates electricity:
27	27	(i) that is intended to be sold at
28	28	wholesale, including the owner or operator of electric energy
29	29	storage equipment or facilities to which Subchapter E, Chapter 35,
30	30	applies; or
31	31	(ii) from a facility that is part of an
32	32	aggregated distributed energy resource or that is owned by a person
33	33	who is part of an aggregated distributed energy resource;
34	34	(B) does not own a transmission or distribution
35	35	facility in this state other than an essential interconnecting
36	36	facility, a facility not dedicated to public use, or a facility
37	37	otherwise excluded from the definition of "electric utility" under
38	38	this section; and
39	39	(C) does not have a certificated service area,
40	40	although its affiliated electric utility or transmission and
41	41	distribution utility may have a certificated service area.
42	42	(17) "Retail electric provider" means a person that
43	43	sells electric energy to retail customers in this state. A retail
44	44	electric provider may not own or operate generation assets but may
45	45	aggregate distributed energy resources. The term does not include
46	46	a person not otherwise a retail electric provider who owns or
47	47	operates equipment used solely to provide electricity charging
48	48	service for consumption by an alternatively fueled vehicle, as
49	49	defined by Section 502.004, Transportation Code.
50	50	SECTION 2. Section 39.351, Utilities Code, is amended by
51	51	amending Subsections (b) and (c) and adding Subsection (d) to read
52	52	as follows:
53	53	(b) A power generation company shall comply with the
54	54	reliability standards adopted by an independent organization
55	55	certified by the commission to ensure the reliability of the
56	56	regional electrical network for a power region in which the power
57	57	generation company is generating or selling electricity and
58	58	aggregated distributed energy resources.
59	59	(c) The commission may establish simplified filing
60	60	requirements for distributed natural gas generation facilities and
61	61	aggregated distributed energy resources.
62	62	(d) Notwithstanding Subsection (a):
63	63	(1) a facility or owner of a facility that is part of
64	64	an aggregated distributed energy resource, or a retail electric
65	65	provider that is involved in aggregating facilities as part of an
66	66	aggregated distributed energy resource, is not considered to be a
67	67	power generation company solely as a result of those activities;
68	68	and
69	69	(2) a facility or owner of a facility that is part of
70	70	an aggregated distributed energy resource is not required to
71	71	register as a power generation company if the person who aggregates
72	72	the resources registers as a power generation company.
73	73	SECTION 3. Subchapter Z, Chapter 39, Utilities Code, is
74	74	amended by adding Section 39.9166 to read as follows:
75	75	Sec. 39.9166. PARTICIPATION OF DISTRIBUTED ENERGY
76	76	RESOURCES IN MARKET. (a) The commission may delegate authority to
77	77	the independent organization certified under Section 39.151 for the
78	78	ERCOT power region to enforce requirements adopted by the
79	79	commission under this section.
80	80	(b) The commission by rule shall allow a person who owns or
81	81	operates a distributed energy resource or an aggregation of
82	82	distributed energy resources to participate in the ancillary
83	83	services and wholesale energy markets in the ERCOT power region if:
84	84	(1) the owner or operator is registered as a power
85	85	generation company if required under Section 39.351 or is exempt
86	86	from registration under Section 39.916(k); and
87	87	(2) the resource meets all requirements established by
88	88	the commission and the independent organization, including
89	89	electric utility specifications applicable under the
90	90	commission-approved tariff.
91	91	(c) The commission by rule shall allow a person to aggregate
92	92	resources that are geographically linked to the same electric bus
93	93	or node so that the resources may be considered to be a single
94	94	distributed energy resource for the purposes of operations,
95	95	compliance, and participation in the ancillary services and
96	96	wholesale energy markets in the ERCOT power region. The commission
97	97	by rule shall direct the independent organization certified under
98	98	Section 39.151 for the ERCOT power region to enable aggregations
99	99	broader than a single electric bus or node when technically
100	100	feasible. In addition to any other applicable requirements,
101	101	aggregated distributed energy resources must:
102	102	(1) demonstrate the ability to deploy energy,
103	103	ancillary services, or both at the direction of the independent
104	104	organization certified under Section 39.151 for the ERCOT power
105	105	region; and
106	106	(2) comply with applicable distribution system
107	107	reliability and market requirements.
108	108	(d) In allowing for the participation of a person who owns
109	109	or operates a distributed energy resource or aggregation of
110	110	distributed energy resources under this section, the commission
111	111	shall adopt registration, qualification, interconnection,
112	112	telemetry, data submission, compliance, cost allocation, and other
113	113	appropriate requirements. The requirements:
114	114	(1) must ensure that:
115	115	(A) participation does not unduly affect the
116	116	security or reliability of the transmission and distribution
117	117	system; and
118	118	(B) the provision of ancillary services by a
119	119	distributed energy resource or aggregation of distributed energy
120	120	resources, to the extent technically necessary to the provision of
121	121	ancillary services, can be measured and verified separately from
122	122	any associated load;
123	123	(2) may differ from requirements for a generation
124	124	resource that is not a distributed energy resource; and
125	125	(3) must provide for energy production and consumption
126	126	at a single metering point to be accounted for and settled by the
127	127	independent organization certified under Section 39.151 for the
128	128	ERCOT power region to the distributed energy provider and the
129	129	retail electric provider in a manner that prevents double counting.
130	130	(e) A retail electric provider may aggregate distributed
131	131	energy resources or assist in the aggregation of distributed energy
132	132	resources for a third party. The retail electric provider:
133	133	(1) is not:
134	134	(A) considered to be a power generation company
135	135	solely for that reason;
136	136	(B) required to register as a power generation
137	137	company; or
138	138	(C) exempt from Chapter 17, this chapter, or
139	139	commission rules relating to the aggregation; and
140	140	(2) is responsible for ensuring the compliance of a
141	141	subcontractor, an agent, or any other entity compensated by the
142	142	retail electric provider for aggregation services.
143	143	(f) Participation in an aggregated distributed energy
144	144	resource by a market participant or consumer is subject to the
145	145	commission's consumer protection rules, jurisdiction, and
146	146	authority under this title.
147	147	SECTION 4. (a) The Public Utility Commission of Texas shall
148	148	adopt the rules required by Section 39.9166, Utilities Code, as
149	149	added by this Act, as soon as practicable after the effective date
150	150	of this Act to ensure that the requirements of Subsection (b) of
151	151	this section are met.
152	152	(b) The Public Utility Commission of Texas shall allow the
153	153	participation as required by Section 39.9166, Utilities Code, as
154	154	added by this Act, not later than September 1, 2024.
155	155	(c) The Public Utility Commission of Texas:
156	156	(1) may operate a pilot program to allow the
157	157	participation described by Section 39.9166, Utilities Code, as
158	158	added by this Act, before September 1, 2024; and
159	159	(2) before September 1, 2024, is not required to
160	160	modify a pilot program operated before the effective date of this
161	161	Act to allow the participation of distributed energy resources in
162	162	the ancillary services and wholesale energy markets in the ERCOT
163	163	power region.
164	164	SECTION 5. This Act takes effect immediately if it receives
165	165	a vote of two-thirds of all the members elected to each house, as
166	166	provided by Section 39, Article III, Texas Constitution. If this
167	167	Act does not receive the vote necessary for immediate effect, this
168	168	Act takes effect September 1, 2023.