88R4503 CXP-F
By: Hughes S.B. No. 1050
A BILL TO BE ENTITLED
AN ACT
relating to the authority of a natural gas local distribution
company to offer energy conservation programs.
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
SECTION 1. Chapter 104, Utilities Code, is amended by
adding Subchapter J to read as follows:
SUBCHAPTER J. NATURAL GAS ENERGY CONSERVATION PROGRAMS
Sec. 104.401. DEFINITIONS. In this subchapter:
(1) "Energy conservation program" means a program that
promotes energy conservation or energy efficiency.
(2) "Local distribution company" means a gas utility
that operates a retail gas distribution system.
Sec. 104.402. ENERGY CONSERVATION PROGRAM AUTHORITY. (a)
A local distribution company may offer to customers and prospective
customers and provide to customers an energy conservation program
in the manner provided by this subchapter.
(b) The railroad commission has exclusive original
jurisdiction over energy conservation programs implemented by
local distribution companies.
(c) A political subdivision served by a local distribution
company that implements an energy conservation program approved by
the railroad commission under this subchapter may not limit,
restrict, or otherwise prevent an eligible customer from
participating in the energy conservation program based on the type
or source of energy delivered to the customer.
Sec. 104.403. ENERGY CONSERVATION PROGRAM COST RECOVERY.
(a) A local distribution company may recover costs prudently
incurred to implement one or more energy conservation programs if:
(1) the company applies to the railroad commission at
least once every three years under this subchapter for review and
approval of the company's energy conservation programs; and
(2) the railroad commission approves cost recovery for
the company's energy conservation programs.
(b) The railroad commission by rule shall require a local
distribution company that implements an energy conservation
program under this subchapter to submit to the railroad commission
an annual report on:
(1) the performance of the company's energy
conservation programs for the preceding year; and
(2) the company's planned energy conservation programs
for the upcoming year.
(c) An application submitted under Subsection (a) must
include:
(1) a summary of and objectives for the local
distribution company's energy conservation programs;
(2) a description of each program;
(3) a proposed budget for each program; and
(4) the projected consumption reduction or cost
savings for each program.
(d) The railroad commission by rule shall:
(1) determine a cost recovery mechanism for timely
recovery of all costs incurred in implementing an energy
conservation program, including:
(A) costs incurred to design, market, implement,
administer, and deliver an energy conservation program; and
(B) an amount equal to the reduction in the local
distribution company's marginal revenues due to the lower sales or
demand resulting from the energy conservation program; and
(2) ensure that costs associated with an energy
conservation program are allocated to the customer classes eligible
for participation in the energy conservation program.
(e) Energy conservation programs proposed under this
section may be combined in a portfolio to provide incentives and
services to encourage energy conservation. The portfolio:
(1) must be designed to overcome barriers to the
adoption of energy-efficient equipment, technologies, and
processes and be designed to change customer behavior as necessary;
and
(2) may include measures such as:
(A) direct financial incentives;
(B) technical assistance and information,
including building energy performance analyses performed by the
local distribution company or a third party approved by the
company;
(C) discounts or rebates for products; and
(D) weatherization for low-income customers.
(f) A local distribution company may purchase carbon
offsets or credits to meet stated conservation objectives in the
company's energy conservation programs and is entitled to recover
the costs of the carbon offsets or credits through a purchased gas
adjustment for operational emissions or as a regulatory asset for
recovery in a future proceeding.
(g) A proceeding filed under this section is not a
ratemaking proceeding for the purposes of Section 103.022.
(h) A local distribution company implementing an energy
conservation program under this subchapter shall reimburse the
railroad commission for the utility's proportionate share of the
railroad commission's costs related to administration of reviewing
and approving or denying cost recovery applications under this
subchapter.
SECTION 2. This Act takes effect immediately if it receives
a vote of two-thirds of all the members elected to each house, as
provided by Section 39, Article III, Texas Constitution. If this
Act does not receive the vote necessary for immediate effect, this
Act takes effect September 1, 2023.