Texas 2023 - 88th Regular

Texas House Bill HB4212 Compare Versions

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Version 2 (New)

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1	1	88R11236 KBB-F
2	2	By: Troxclair H.B. No. 4212
3	3
4	4
5	5	A BILL TO BE ENTITLED
6	6	AN ACT
7	7	relating to competition in the electric utility market of certain
8	8	municipalities.
9	9	BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
10	10	SECTION 1. Section 40.003, Utilities Code, is amended by
11	11	amending Subsection (a) and adding Subsection (g) to read as
12	12	follows:
13	13	(a) Municipally owned utilities, other than utilities
14	14	required to initiate customer choice under Section 40.051(d), and
15	15	river authorities may adopt and use securitization provisions
16	16	having the effect of the provisions provided by Subchapter G,
17	17	Chapter 39, to recover through appropriate charges their stranded
18	18	costs, at a recovery level deemed appropriate by the municipally
19	19	owned utility or river authority up to 100 percent, under rules and
20	20	procedures that shall be established:
21	21	(1) in the case of a municipally owned utility to which
22	22	this subsection applies, by the municipal governing body or a body
23	23	vested with the power to manage and operate the municipally owned
24	24	utility, including procedures providing for rate orders of the
25	25	governing body having the effect of financing orders, providing for
26	26	a separate nonbypassable charge approved by the governing body, in
27	27	the nature of a transition charge, to be collected from all retail
28	28	electric customers of the municipally owned utility, identified as
29	29	of a date determined by the governing body, to fund the recovery of
30	30	the stranded costs of the municipally owned utility and of all
31	31	reasonable related expenses, as determined by the governing body,
32	32	and providing for the issuance of bonds, having a term and other
33	33	characteristics as determined by the governing body, as necessary
34	34	to recover the amount deemed appropriate by the governing body
35	35	through securitization financing; and
36	36	(2) in the case of a river authority, by the
37	37	commission.
38	38	(g) A municipally owned utility required to initiate
39	39	customer choice under Section 40.051(d) may recover the utility's
40	40	stranded cost through securitization provisions:
41	41	(1) having the effect of the provisions provided by
42	42	Subchapter G, Chapter 39; and
43	43	(2) under rules and procedures established by the
44	44	commission.
45	45	SECTION 2. Section 40.051, Utilities Code, is amended by
46	46	amending Subsection (a) and adding Subsection (d) to read as
47	47	follows:
48	48	(a) Except as provided by Subsection (d), the [The]
49	49	municipal governing body or a body vested with the power to manage
50	50	and operate a municipally owned utility has the discretion to
51	51	decide when or if the municipally owned utility will provide
52	52	customer choice.
53	53	(d) Not later than the 365th day after the date a municipal
54	54	governing body or other body described by Subsection (a) receives
55	55	notice under Section 2165.059, Government Code, that the utility is
56	56	included on the list created under that section, the utility shall:
57	57	(1) initiate customer choice; and
58	58	(2) except as otherwise provided by this chapter, be
59	59	considered to be a municipally owned utility that chooses to
60	60	participate in customer choice under Subsection (b) for purposes of
61	61	this subtitle.
62	62	SECTION 3. Section 40.054, Utilities Code, is amended by
63	63	amending Subsection (e) and adding Subsection (g) to read as
64	64	follows:
65	65	(e) The commission does not have jurisdiction to require
66	66	unbundling of services or functions of[, or to regulate the
67	67	recovery of stranded investment of,] a municipally owned utility
68	68	or, except as provided by this section, jurisdiction with respect
69	69	to the rates, terms, and conditions of service for retail customers
70	70	of a municipally owned utility within the utility's certificated
71	71	service area.
72	72	(g) Except as provided by Section 40.003(g), the commission
73	73	does not have jurisdiction to regulate the recovery of stranded
74	74	investment of a municipally owned utility.
75	75	SECTION 4. Section 40.055, Utilities Code, is amended by
76	76	amending Subsection (a) and adding Subsection (c) to read as
77	77	follows:
78	78	(a) The municipal governing body or a body vested with the
79	79	power to manage and operate a municipally owned utility has
80	80	exclusive jurisdiction to:
81	81	(1) set all terms of access, conditions, and rates
82	82	applicable to services provided by the municipally owned utility,
83	83	subject to Sections 40.054 and 40.056, including nondiscriminatory
84	84	and comparable rates for distribution, but excluding wholesale
85	85	transmission rates, terms of access, and conditions for wholesale
86	86	transmission service set by the commission under this subtitle,
87	87	provided that the rates for distribution access established by the
88	88	municipal governing body shall be comparable to the distribution
89	89	access rates that apply to the municipally owned utility and the
90	90	municipally owned utility's affiliates;
91	91	(2) determine whether to unbundle any energy-related
92	92	activities and, if the municipally owned utility chooses to
93	93	unbundle, whether to do so structurally or functionally;
94	94	(3) except for a municipally owned utility required to
95	95	initiate customer choice under Section 40.051(d), reasonably
96	96	determine the amount of the municipally owned utility's stranded
97	97	investment;
98	98	(4) except for a municipally owned utility required to
99	99	initiate customer choice under Section 40.051(d), establish
100	100	nondiscriminatory transition charges reasonably designed to
101	101	recover the stranded investment over an appropriate period of time,
102	102	provided that recovery of retail stranded costs shall be from all
103	103	existing or future retail customers, including the facilities,
104	104	premises, and loads of those retail customers, within the utility's
105	105	geographical certificated service area as it existed on May 1,
106	106	1999;
107	107	(5) determine the extent to which the municipally
108	108	owned utility will provide various customer services at the
109	109	distribution level, including other services that the municipally
110	110	owned utility is legally authorized to provide, or will accept the
111	111	services from other providers;
112	112	(6) manage and operate the municipality's electric
113	113	utility systems, including exercise of control over resource
114	114	acquisition and any related expansion programs;
115	115	(7) establish and enforce service quality and
116	116	reliability standards and consumer safeguards designed to protect
117	117	retail electric customers, including safeguards that will
118	118	accomplish the objectives of Sections 39.101(a) and (b), consistent
119	119	with this chapter;
120	120	(8) determine whether a base rate reduction is
121	121	appropriate for the municipally owned utility;
122	122	(9) determine any other utility matters that the
123	123	municipal governing body or body vested with power to manage and
124	124	operate the municipally owned utility believes should be included;
125	125	(10) make any other decisions affecting the
126	126	municipally owned utility's participation in customer choice that
127	127	are not inconsistent with this chapter; and
128	128	(11) determine the extent to which the municipally
129	129	owned utility offers energy efficiency programs and how the
130	130	programs are administered by the utility, except as provided by
131	131	Section 39.9051(e).
132	132	(c) For a municipally owned utility required to initiate
133	133	customer choice under Section 40.051(d), the relevant date for the
134	134	commission to identify stranded investment is the date the
135	135	municipal governing body or other body receives notice under
136	136	Section 2165.059, Government Code, that the utility is included on
137	137	the list created under that section.
138	138	SECTION 5. Subchapter B, Chapter 40, Utilities Code, is
139	139	amended by adding Section 40.061 to read as follows:
140	140	Sec. 40.061. ENFORCEMENT OF CUSTOMER CHOICE. (a) In this
141	141	section, "governing body" means the body vested with the power to
142	142	manage and operate a municipally owned utility.
143	143	(b) If the commission determines that a municipally owned
144	144	utility required to initiate customer choice under Section
145	145	40.051(d) is not adequately offering customer choice on the 90th
146	146	day after the date customer choice was to be initiated, the utility
147	147	becomes subject to the oversight authority of the commission for
148	148	matters relating to the implementation of customer choice.
149	149	(c) The commission shall make a determination under
150	150	Subsection (b), if any, as soon as practicable after the expiration
151	151	of the 90-day period. The commission assumes oversight authority
152	152	over the municipally owned utility on the date the commission makes
153	153	an affirmative determination that the utility is not adequately
154	154	offering customer choice, and this authority encompasses any
155	155	portion of the authority vested with the governing body of the
156	156	utility under this subchapter that the commission determines is
157	157	necessary.
158	158	(d) The governing body shall work cooperatively with the
159	159	commission in offering customer choice.
160	160	(e) The oversight authority under this section continues
161	161	until the date the commission determines that the municipally owned
162	162	utility:
163	163	(1) has completed the transition to customer choice;
164	164	and
165	165	(2) is prepared to continue to provide customer choice
166	166	in a manner consistent with the competitive market.
167	167	(f) On the date the commission makes an affirmative
168	168	determination under Subsection (e), the management and operation of
169	169	the municipally owned utility returns to the control of the
170	170	utility's governing body.
171	171	SECTION 6. Subchapter B, Chapter 2165, Government Code, is
172	172	amended by adding Section 2165.059 to read as follows:
173	173	Sec. 2165.059. LIST BASED ON CERTAIN STATE-OWNED OFFICE
174	174	SPACE. (a) On the second Monday in September of each year, the
175	175	commission shall:
176	176	(1) create a list of each municipally owned utility in
177	177	whose certificated retail service area the commission manages three
178	178	million or more square feet of state-owned office space; and
179	179	(2) for each utility that appears on the list for the
180	180	first time, notify the Public Utility Commission of Texas and the
181	181	governing body vested with the power to manage and operate the
182	182	utility of the utility's addition to the list.
183	183	(b) The Public Utility Commission of Texas shall assist the
184	184	commission as necessary in performing duties under Subsection (a).
185	185	SECTION 7. (a) The changes in law made by this Act apply
186	186	only to the activities of a municipally owned utility that occur on
187	187	or after the effective date of this Act. Activities of a
188	188	municipally owned utility that occur before the effective date of
189	189	this Act are governed by the law in effect on the date the
190	190	activities occurred, and the former law is continued in effect for
191	191	that purpose.
192	192	(b) The Texas Facilities Commission shall create the
193	193	initial list described by Section 2165.059, Government Code, as
194	194	added by this Act, on September 11, 2023.
195	195	SECTION 8. This Act takes effect immediately if it receives
196	196	a vote of two-thirds of all the members elected to each house, as
197	197	provided by Section 39, Article III, Texas Constitution. If this
198	198	Act does not receive the vote necessary for immediate effect, this
199	199	Act takes effect September 1, 2023.