Texas 2023 - 88th Regular

Texas Senate Bill SB1075 Compare Versions

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1	1	By: King S.B. No. 1075
2	2	(Guillen)
3	3
4	4
5	5	A BILL TO BE ENTITLED
6	6	AN ACT
7	7	relating to facilities and construction machinery used to respond
8	8	to power outages.
9	9	BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
10	10	SECTION 1. Section 39.918, Utilities Code, is amended to
11	11	read as follows:
12	12	Sec. 39.918. UTILITY FACILITIES FOR RESPONDING TO
13	13	SIGNIFICANT [POWER RESTORATION AFTER WIDESPREAD] POWER
14	14	OUTAGE. (a) In this section, "significant ["widespread] power
15	15	outage" means an event that [results in]:
16	16	(1) results in a loss of electric power that:
17	17	(A) affects a significant number of distribution
18	18	customers of a transmission and distribution utility[;] and
19	19	[(B)] has lasted or is expected to last for at
20	20	least six [eight] hours;
21	21	(B) affects distribution customers of a
22	22	transmission and distribution utility in an area for which the
23	23	governor has issued a disaster or emergency declaration;
24	24	(C) affects distribution customers served by a
25	25	radial transmission or distribution facility, creates a risk to
26	26	public health or safety, and has lasted or is expected to last for
27	27	at least 12 hours; or
28	28	(D) creates [and
29	29	[(2)] a risk to public health or safety because it
30	30	affects a critical infrastructure facility that serves the public
31	31	such as a hospital, health care facility, law enforcement facility,
32	32	fire station, or water or wastewater facility; or
33	33	(2) causes the independent system operator to order a
34	34	transmission and distribution utility to shed load.
35	35	(a-1) The Texas Division of Emergency Management, the
36	36	independent organization certified under Section 39.151 for the
37	37	ERCOT power region, or the executive director of the commission may
38	38	determine that a power outage other than an outage described by
39	39	Subsection (a) is a significant power outage for the purposes of
40	40	this section.
41	41	(a-2) A transmission and distribution utility is entitled
42	42	to determine whether a loss of electric power described by
43	43	Subsection (a)(1)(C) creates a risk to public health or safety for
44	44	the purposes of determining whether the loss event is a significant
45	45	power outage.
46	46	(b) Notwithstanding any other provision of this subtitle, a
47	47	transmission and distribution utility may:
48	48	(1) lease and operate facilities that provide
49	49	temporary emergency electric energy to aid in restoring power to
50	50	the utility's distribution customers during a significant
51	51	[widespread] power outage [in which:
52	52	[(A) the independent system operator has ordered
53	53	the utility to shed load; or
54	54	[(B) the utility's distribution facilities are
55	55	not being fully served by the bulk power system under normal
56	56	operations]; and
57	57	(2) procure, own, and operate, or enter into a
58	58	cooperative agreement with other transmission and distribution
59	59	utilities to procure, own, and operate jointly, transmission and
60	60	distribution facilities that have a lead time of at least six months
61	61	and would aid in restoring power to the utility's distribution
62	62	customers following a significant [widespread] power outage.
63	63	(b-1) In this section, long lead time facilities described
64	64	by Subsection (b) may not be electric energy storage equipment or
65	65	facilities described by [under] Chapter 35[, Utilities Code].
66	66	(b-2) An affiliate of a transmission and distribution
67	67	utility:
68	68	(1) may own temporary emergency electric energy
69	69	facilities described by Subsection (b)(1);
70	70	(2) may lease to the utility temporary emergency
71	71	electric energy facilities described by Subsection (b)(1) if the
72	72	costs of the lease comply with the requirements of Section 36.058;
73	73	(3) is not considered to be a power generation company
74	74	for the purposes of this title or the commission's rules based
75	75	solely on the ownership of and leasing to the utility temporary
76	76	emergency electric energy facilities described by Subsection
77	77	(b)(1);
78	78	(4) is considered to be a competitive affiliate for
79	79	the purposes of this title and the commission's rules if the
80	80	affiliate engages in the business of owning and leasing to
81	81	unaffiliated third parties temporary emergency electric energy
82	82	facilities described by Subsection (b)(1); and
83	83	(5) is considered to be a competitive affiliate only
84	84	for the purposes of Section 36.058 if:
85	85	(A) the affiliate engages solely in the business
86	86	of owning and leasing to the utility temporary emergency electric
87	87	energy facilities described by Subsection (b)(1); and
88	88	(B) the utility demonstrates that the cost of
89	89	leasing temporary emergency electric energy facilities described
90	90	by Subsection (b)(1) from the affiliate provides benefits to
91	91	ratepayers equal to or greater than would have been achieved by
92	92	leasing the facilities from an unaffiliated third party.
93	93	(c) A transmission and distribution utility that [leases
94	94	and] operates a facility [facilities] under Subsection (b)(1) may
95	95	not sell electric energy or ancillary services from the facility
96	96	[those facilities]. As soon as reasonably practicable after the
97	97	utility deploys the facility, the utility shall provide written
98	98	notice to the commission and a written market notice to advise
99	99	competitive market participants of the details of the deployment.
100	100	Not later than the fifth business day after the date the deployment
101	101	ends, the utility shall file a report, in a form approved by the
102	102	commission, providing the details of the deployment, including the
103	103	start and end times of the deployment, the number of kilowatts or
104	104	megawatts deployed, the number of facilities used, the locations of
105	105	the facilities, and any other information required by the
106	106	commission.
107	107	(d) A facility [Facilities] described by Subsection (b)(1):
108	108	(1) must be operated in isolation from the bulk power
109	109	system; and
110	110	(2) may not be included in independent system
111	111	operator:
112	112	(A) locational marginal pricing calculations;
113	113	(B) pricing; or
114	114	(C) reliability models.
115	115	(e) A transmission and distribution utility that [leases
116	116	and] operates a facility [facilities] under Subsection (b)(1) shall
117	117	ensure, to the extent reasonably practicable, that retail customer
118	118	usage during operation of the facility [those facilities] is
119	119	adjusted out of the usage reported for billing purposes by the
120	120	retail customer's retail electric provider.
121	121	(f) A transmission and distribution utility that decides to
122	122	lease a facility under Subsection (b)(1) shall, when reasonably
123	123	practicable, solicit [use a] competitive bids and consider any bids
124	124	received before leasing the facility [bidding process to lease
125	125	facilities under Subsection (b)(1)].
126	126	(g) A transmission and distribution utility that leases and
127	127	operates facilities under Subsection (b)(1) or that procures, owns,
128	128	and operates facilities under Subsection (b)(2) shall include in
129	129	the utility's emergency operations plan filed with the commission,
130	130	as described by Section 186.007, a detailed plan on the utility's
131	131	use of those facilities.
132	132	(h) The commission shall allow [permit]:
133	133	(1) a transmission and distribution utility that
134	134	leases and operates facilities under Subsection (b)(1) to recover
135	135	the reasonable and necessary costs of leasing and operating the
136	136	facilities, including the present value of future payments required
137	137	under a [the] lease, using the rate of return on investment
138	138	established in the commission's final order in the utility's most
139	139	recent base rate proceeding; and
140	140	(2) a transmission and distribution utility that
141	141	procures, owns, and operates facilities under Subsection (b)(2) to
142	142	recover the reasonable and necessary costs of procuring, owning,
143	143	and operating the facilities, using the rate of return on
144	144	investment established in the commission's final order in the
145	145	utility's most recent base rate proceeding.
146	146	(i) The commission shall authorize a transmission and
147	147	distribution utility to defer for recovery in a future ratemaking
148	148	proceeding the incremental operations and maintenance expenses and
149	149	the return, not otherwise recovered in a rate proceeding,
150	150	associated with the leasing or procurement, ownership, and
151	151	operation of the facilities.
152	152	(j) A transmission and distribution utility may request
153	153	recovery of the reasonable and necessary costs of leasing or
154	154	procuring, owning, and operating facilities under this section,
155	155	including any deferred expenses, through a proceeding under Section
156	156	36.210 or in another ratemaking proceeding. The commission may
157	157	review costs recovered through a proceeding under Section 36.210 in
158	158	the following base rate proceeding and order refunds to customers
159	159	if appropriate.
160	160	(k) A transmission and distribution utility requesting cost
161	161	recovery under Subsection (j) is entitled to select whether the
162	162	costs are considered to be distribution substation equipment costs
163	163	or distribution transformer costs unless the commission has found
164	164	in a previous base rate proceeding for the utility that temporary
165	165	emergency electric energy costs should be categorized in a
166	166	different manner. The costs may not be treated as transmission
167	167	costs. A lease under Subsection (b)(1) must be treated as a capital
168	168	lease or finance lease for ratemaking purposes.
169	169	(l) The fact that the commission has not previously approved
170	170	a facility operated under this section or a cost of leasing,
171	171	procuring, owning, or operating a facility under this section is
172	172	not grounds for dismissal of the facility or the cost from a
173	173	proceeding under Section 36.210 or another ratemaking proceeding.
174	174	(m) Each transmission and distribution utility that leases
175	175	and operates a facility under Subsection (b)(1) shall:
176	176	(1) assess every four years the total capacity of
177	177	facilities needed to aid in restoring power during a significant
178	178	power outage, considering:
179	179	(A) the presence and frequency of extreme weather
180	180	conditions, including hurricanes, tornadoes, high winds,
181	181	lightning, flooding, icing, and freezes, in all or a portion of the
182	182	utility's certificated service area;
183	183	(B) the utility's current and planned system
184	184	hardening efforts;
185	185	(C) the utility's current and planned vegetation
186	186	management efforts;
187	187	(D) the utility's current and planned
188	188	expenditures on traditional distribution facilities;
189	189	(E) the utility's current and planned
190	190	expenditures on automation of its distribution system;
191	191	(F) the utility's allocated load shed obligation
192	192	based on historical seasonal peak demand, as determined by the
193	193	independent system operator;
194	194	(G) the presence or number of communities that
195	195	are remotely located or served radially in the utility's
196	196	certificated service area;
197	197	(H) the number or location of critical
198	198	infrastructure facilities that serve the public such as hospitals,
199	199	health care facilities, law enforcement facilities, fire stations,
200	200	and water or wastewater facilities in the utility's certificated
201	201	service area;
202	202	(I) the utility's emergency operations plan
203	203	filed with the commission; and
204	204	(J) other engineering or operational needs; and
205	205	(2) submit to the commission the assessment under
206	206	Subdivision (1) for review.
207	207	(n) The commission may:
208	208	(1) establish the capacity of facilities that may be
209	209	operated by a transmission and distribution utility in aid of
210	210	restoration for each type or category of significant power outage;
211	211	(2) establish reasonable conditions on the operation
212	212	and use of facilities, including duration times and prioritizing
213	213	use to serve critical infrastructure facilities that serve the
214	214	public such as hospitals, health care facilities, law enforcement
215	215	facilities, fire stations, and water or wastewater facilities; and
216	216	(3) require compliance with applicable law, including
217	217	any rule or order of the commission.
218	218	(o) Notwithstanding Subsections (m) and (n), a transmission
219	219	and distribution utility may:
220	220	(1) provide facilities to or use facilities from other
221	221	entities as part of a mutual assistance agreement during a
222	222	significant power outage; and
223	223	(2) lease facilities on a short-term basis in response
224	224	to a significant power outage if:
225	225	(A) the significant power outage constitutes an
226	226	emergency and the utility determines that additional facilities are
227	227	necessary;
228	228	(B) the term of the lease is only for the duration
229	229	of that emergency;
230	230	(C) the utility notifies the commission of the
231	231	lease not later than the 30th day after the date of the lease
232	232	agreement; and
233	233	(D) the commission reviews the costs incurred by
234	234	the utility in a proceeding under Section 36.210 or in another
235	235	ratemaking proceeding.
236	236	[(k) This section expires September 1, 2029.]
237	237	SECTION 2. Section 502.146(b), Transportation Code, is
238	238	amended to read as follows:
239	239	(b) An owner is not required to register a vehicle that is
240	240	used only temporarily on the highways if the vehicle is:
241	241	(1) a farm trailer or farm semitrailer with a gross
242	242	weight of more than 4,000 pounds but not more than 34,000 pounds
243	243	that is used exclusively:
244	244	(A) to transport seasonally harvested
245	245	agricultural products or livestock from the place of production to
246	246	the place of processing, market, or storage;
247	247	(B) to transport farm supplies from the place of
248	248	loading to the farm; or
249	249	(C) for the purpose of participating in equine
250	250	activities or attending livestock shows, as defined by Section
251	251	87.001, Civil Practice and Remedies Code;
252	252	(2) machinery used exclusively for the purpose of
253	253	drilling water wells;
254	254	(3) oil well servicing or drilling machinery and if at
255	255	the time of obtaining the license plates, the applicant submits
256	256	proof that the applicant has a permit under Section 623.142; or
257	257	(4) construction machinery, including construction
258	258	machinery that is:
259	259	(A) owned by a transmission and distribution
260	260	utility as defined by Section 31.002, Utilities Code; and
261	261	(B) used to maintain or repair electrical lines
262	262	or substations in response to a power outage.
263	263	SECTION 3. (a) The changes in law made in Section 1 of this
264	264	Act apply only to a proceeding before the Public Utility Commission
265	265	of Texas or other regulatory authority described by Section 11.003,
266	266	Utilities Code, that commences on or after the effective date of
267	267	this Act. A proceeding before the Public Utility Commission of
268	268	Texas or other regulatory authority described by Section 11.003,
269	269	Utilities Code, that commenced before the effective date of this
270	270	Act is governed by the law in effect on the date the proceeding
271	271	commenced, and that law is continued in effect for that purpose.
272	272	(b) The changes in law made in Section 1 of this Act apply
273	273	only to a contract or lease entered into or facilities procured on
274	274	or after the effective date of this Act.
275	275	SECTION 4. To the extent of any conflict, this Act prevails
276	276	over another Act of the 88th Legislature, Regular Session, 2023,
277	277	relating to nonsubstantive additions to and corrections in enacted
278	278	codes.
279	279	SECTION 5. This Act takes effect September 1, 2023.