By: Troxclair H.B. No. 4213
A BILL TO BE ENTITLED
AN ACT
relating to rates for electricity charged by certain municipally
owned utilities and to the use of revenue from the rates.
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
SECTION 1. Subchapter B, Chapter 40, Utilities Code, is
amended by adding Section 40.0521 to read as follows:
Sec. 40.0521. RATES OF AND USE OF REVENUE BY CERTAIN
UTILITIES NOT OFFERING CUSTOMER CHOICE. (a) This section applies
only to a municipally owned utility that is governed directly by the
governing body of the municipality and is owned by a municipality
with a population of more than 750,000.
(b) This section does not require a municipally owned
utility to implement or opt for customer choice.
(c) In the case of a conflict between this section and
another provision of law, this section prevails.
(d) A municipally owned utility may not:
(1) directly or indirectly subsidize wholesale
competitive activities through rates charged for the provision of
retail electric service that include fixed or variable costs
reasonably attributable to the operation and maintenance of
municipally owned utility assets that generate energy for sale at
wholesale; or
(2) charge rates for the provision of retail electric
service that exceed 50 percent of the average rates available to
similarly situated customers in areas of the state that have access
to customer choice.
(e) The commission by rule shall require a municipally owned
utility to submit to the commission information to allow the
commission to determine whether the municipally owned utility is
complying with the requirements of Subsection (d). The commission
shall notify the municipal governing body if the commission
determines that the municipally owned utility is not complying with
the requirements of Subsection (d).
(f) A municipal governing body that receives notice from the
commission under Subsection (e):
(1) shall require the municipally owned utility to
comply with Subsection (d); and
(2) may, in a manner consistent with Section
40.055(a)(4), reasonably determine the amount of the municipally
owned utility's stranded investment and calculate and establish for
the municipally owned utility a non-bypassable charge reflecting
stranded costs properly attributable to the municipally owned
utility's retail electric service customers.
(g) The relevant date for identifying stranded investment
under Subsection (f) is November 30, 2010, instead of the date
specified in Section 40.055(a)(4). The amount and duration of the
charge under Subsection (f) must:
(1) be calculated in a similar manner to that
prescribed by Subchapter F, Chapter 39;
(2) include the calculation of nuclear
decommissioning costs as allowed by Sections 39.205 and 39.206; and
(3) consider the municipally owned utility's capital
and debt structure.
(h) A person affected by a determination made under this
section by a municipal governing body may appeal the determination
to the commission by filing with the commission a petition for
review not later than the 30th day after the date of the
determination. An appeal under this section is de novo. The
commission shall enter a final order:
(1) approving the determination of the municipal
governing body; or
(2) substituting the commission's own determination.
(i) A municipally owned utility may use the net proceeds of
its wholesale competitive activities for utility debt repayment,
reduction of purchased power costs, or vegetation management. The
municipally owned utility shall:
(1) document and book the underlying transactions in
auditable form; and
(2) on at least an annual basis as part of the
budgeting process, disclose to the public the net amount of the
proceeds and the intended uses of the proceeds.
SECTION 2. A municipally owned utility described by Section
40.0521, Utilities Code, as added by this Act, that does not comply
with Section 40.0521, Utilities Code, as added by this Act, on the
effective date of this Act shall comply with Section 40.0521,
Utilities Code, as added by this Act, not later than March 1, 2024.
SECTION 3. This Act takes effect September 1, 2023.