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Texas Senate Bill SB1212

Texas 2023 - 88th Regular

Texas Senate Bill SB1212 Compare Versions

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11 By: Johnson, Eckhardt S.B. No. 1212
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33
44 A BILL TO BE ENTITLED
55 AN ACT
66 relating to the interconnection and integration of distributed
77 energy resources.
88 BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
99 SECTION 1. Section 31.002, Utilities Code, is amended by
1010 adding Subdivisions (2-a) and (4-c) and amending Subdivision (10)
1111 to read as follows:
1212 (2-a) "Aggregated distributed energy resource" means
1313 a group of distributed energy resources joined together to be
1414 operated as a single distributed energy resource, where each
1515 individual resource in the aggregation produces not more than 1.5
1616 megawatts of electricity, subject to an increase or decrease by
1717 commission rule if the commission determines that a different
1818 capacity size limit is appropriate and does not adversely affect
1919 the ERCOT power region or distribution system reliability.
2020 (4-c) "Distributed energy resource" means a source of
2121 electricity connected at a voltage less than 60 kilovolts,
2222 including electric energy storage, distributed generation,
2323 distributed natural gas generation, or electric vehicles that
2424 provide electricity onto the distribution system. The term does
2525 not include a facility that provides temporary emergency electric
2626 energy under Section 39.918.
2727 (10) "Power generation company" means a person[,
2828 including a person who owns or operates a distributed natural gas
2929 generation facility,] that:
3030 (A) generates electricity that is intended to be
3131 sold at wholesale, including the owner or operator of electric
3232 energy storage equipment or facilities to which Subchapter E,
3333 Chapter 35, applies;
3434 (B) does not own a transmission or distribution
3535 facility in this state other than an essential interconnecting
3636 facility, a facility not dedicated to public use, or a facility
3737 otherwise excluded from the definition of "electric utility" under
3838 this section; and
3939 (C) does not have a certificated service area,
4040 although its affiliated electric utility or transmission and
4141 distribution utility may have a certificated service area.
4242 SECTION 2. Subchapter H, Chapter 39, Utilities Code, is
4343 amended by adding Section 39.3515 to read as follows:
4444 Sec. 39.3515. REGISTRATION OF DISTRIBUTED ENERGY
4545 RESOURCES. (a) An owner or operator of a distributed energy
4646 resource may provide energy or ancillary services in the wholesale
4747 market in the ERCOT power region through generating electricity and
4848 providing that electricity onto a distribution system only if:
4949 (1) the owner or operator is registered with the
5050 commission as a power generation company under Section 39.351 and
5151 authorized by the independent organization certified under Section
5252 39.151 for the ERCOT power region; or
5353 (2) the distributed energy resource:
5454 (A) is part of an aggregated distributed energy
5555 resource that is included in the registration of a power generation
5656 company under Section 39.351 and the independent organization
5757 certified under Section 39.151 for the ERCOT power region; and
5858 (B) has complied with the interconnection
5959 requirements of the interconnecting transmission and distribution
6060 utility.
6161 (b) The commission may establish simplified filing
6262 requirements to facilitate the registration of aggregated
6363 distributed energy resources. The filing requirements must require
6464 the registrant to disclose the name of the power generation company
6565 that operates the aggregated distributed energy resource.
6666 (c) Notwithstanding any other provision of this chapter, a
6767 facility described by Section 39.914 or 39.916 may not be
6868 aggregated unless the facility is interconnected and operated in
6969 parallel with the distribution system, and:
7070 (1) electricity from the facility provides energy or
7171 ancillary services in the wholesale market in the ERCOT power
7272 region in a manner described by this section; or
7373 (2) the estimated annual amount of electricity to be
7474 produced by the facility is more than the retail electric
7575 customer's estimated annual electricity consumption at the time of
7676 the facility's installation or the actual amount of electricity
7777 produced by the facility was more than the retail electric
7878 customer's actual electricity consumption in the year prior to the
7979 facility's installation.
8080 (d) The commission by rule shall:
8181 (1) authorize the registrations described by
8282 Subsection (a); and
8383 (2) adopt procedures for the creation of aggregated
8484 distributed energy resources.
8585 SECTION 3. Chapter 39, Utilities Code, is amended by adding
8686 Subchapter O to read as follows:
8787 SUBCHAPTER O. INTERCONNECTION OF DISTRIBUTED ENERGY RESOURCES
8888 Sec. 39.701. METERING EQUIPMENT AND INFORMATION. An
8989 interconnecting transmission and distribution utility is not
9090 required to provide an owner or operator of a distributed energy
9191 resource access to the utility's meter equipment if essential
9292 metering information is made available by the utility or
9393 cooperative.
9494 Sec. 39.702. INTEGRATION AND COST RECOVERY. (a) The
9595 commission by rule shall establish for the ERCOT power region:
9696 (1) requirements for the dispatchability,
9797 reliability, and other characteristics of each type or
9898 classification of distributed energy resource;
9999 (2) appropriate disclosure requirements and other
100100 customer protections for residential and small commercial
101101 customers of providers of aggregated distributed energy services;
102102 (3) information an owner or operator of a distributed
103103 energy resource must provide to the interconnecting transmission
104104 and distribution utility to ensure the resource will not adversely
105105 affect the transmission or distribution system;
106106 (4) interconnection guidelines that address:
107107 (A) the determination of whether a given
108108 interconnection or combination of interconnections would exceed a
109109 transmission and distribution utility's system capacity in a
110110 particular location;
111111 (B) considerations for feeder locations related
112112 to distributed energy resources;
113113 (C) considerations of the size or capacity of a
114114 distributed energy resource;
115115 (D) the assessment by the interconnecting
116116 transmission and distribution utility of potential impacts to other
117117 customers in the area of the distributed energy resource; and
118118 (E) other operating parameters necessary for the
119119 transmission and distribution utility's reliable operation of its
120120 transmission and distribution system;
121121 (5) a methodology for the appropriate allocation and
122122 recovery of the transmission and distribution utility's costs to
123123 interconnect a distributed energy resource; and
124124 (6) requirements for the independent organization
125125 certified under Section 39.151 for the ERCOT power region to report
126126 to the commission periodically:
127127 (A) the categories and generation levels of
128128 distributed energy resources allowed to participate in the ERCOT
129129 wholesale market;
130130 (B) the categories and megawatt levels of
131131 aggregated distributed energy resources allowed to participate in
132132 the ERCOT wholesale market;
133133 (C) performance metrics for distributed energy
134134 resources allowed to participate in the ERCOT wholesale market; and
135135 (D) other information the commission may
136136 require.
137137 (b) The commission shall authorize a transmission and
138138 distribution utility to:
139139 (1) defer for recovery in a later ratemaking
140140 proceeding the incremental operations and maintenance expenses, or
141141 other expenses, and the return, not otherwise recovered in a rate
142142 proceeding, associated with the installation, modification,
143143 upgrade, or maintenance of its transmission or distribution
144144 facilities required by an interconnection with a distributed energy
145145 resource; and
146146 (2) request recovery of the costs associated with an
147147 interconnection with a distributed energy resource, including any
148148 deferred expenses, through a proceeding under Section 35.004 or
149149 36.210 or in another ratemaking proceeding regardless of whether
150150 the utility or cooperative first requested recovery in a base-rate
151151 proceeding.
152152 (c) Facilities required by an interconnection with a
153153 distributed energy resource are considered used and useful in
154154 providing service to the public and are prudent and includable in
155155 the rate base, regardless of the extent of the actual use of the
156156 facilities.
157157 (d) This subchapter does not:
158158 (1) require or authorize a distribution service
159159 provider to procure distributed energy resource services to enable
160160 the operation of the distribution system;
161161 (2) require a distribution service provider to
162162 disclose to any third party, except as required by the independent
163163 system operator, the provider's system planning information,
164164 studies, models, critical infrastructure information, or other
165165 confidential information;
166166 (3) diminish a distribution service provider's rights
167167 or obligations to own or operate its distribution system and
168168 provide electric delivery service to retail customers in the
169169 provider's certificated service area;
170170 (4) obligate a distribution service provider to
171171 interconnect a distributed energy resource with a capacity equal to
172172 or greater than 10 megawatts; or
173173 (5) prohibit an interconnecting distribution service
174174 provider from shedding a distributed energy resource, or otherwise
175175 obligate an interconnecting distribution service provider to
176176 provide preferential treatment to feeders with distributed energy
177177 resources or prevent a transmission and distribution utility from
178178 fulfilling its load shedding obligations during an involuntary load
179179 shedding event initiated by the independent system operator or a
180180 planned or unplanned outage of the distribution system.
181181 Sec. 39.703. LIABILITY. An interconnecting transmission
182182 and distribution utility or retail electric provider providing
183183 service to a distributed energy resource to which this subchapter
184184 applies is not liable for:
185185 (1) a violation of reliability or service metrics
186186 caused by distributed energy resource operations that violate its
187187 interconnection agreement; or
188188 (2) a distributed energy resource's inability or
189189 failure to provide services that violate its interconnection
190190 agreement or a penalty for such inability or failure.
191191 SECTION 4. (a) This section takes effect only if the Act of
192192 the 88th Legislature, Regular Session, 2023, relating to
193193 nonsubstantive additions to and corrections in enacted codes
194194 becomes law.
195195 (b) Subchapter Z, Chapter 39, Utilities Code, is amended by
196196 adding Section 39.9166 to read as follows:
197197 Sec. 39.9166. DISTRIBUTED ENERGY RESOURCES. (a) A
198198 customer who purchases or leases a distributed energy resource or
199199 enters into a power purchase agreement for a distributed energy
200200 resource in the ERCOT power region is entitled to the information
201201 and disclosures required under Chapter 115, Business & Commerce
202202 Code, and is entitled to protection from fraudulent, unfair,
203203 misleading, or deceptive practices.
204204 (b) An owner or operator of a distributed energy resource
205205 may provide energy or ancillary services in the wholesale market in
206206 the ERCOT power region.
207207 (c) A person who owns or operates a distributed energy
208208 resource in an area in which customer choice has been introduced and
209209 is part of an aggregated distributed energy resource, or has not
210210 individually registered with the commission as its own power
211211 generation company, must sell the surplus electricity that is
212212 produced by the distributed energy resource and not consumed by the
213213 owner's premise to the retail electric provider that serves the
214214 premise's load at a value agreed to between the distributed energy
215215 resource owner and the retail electric provider that serves the
216216 premise's load. The value may be an agreed value based on the
217217 clearing price of energy or ancillary service at the time of day
218218 that the electricity is made available to the grid.
219219 (d) A person who operates an aggregated distributed energy
220220 resource in an area in which customer choice has been introduced is
221221 subject to customer protection rules established by the commission
222222 under Chapter 17 and this chapter.
223223 (e) The independent organization certified under Section
224224 39.151 for the ERCOT power region shall adopt procedures to ensure
225225 that the amount of electricity purchased from a distributed energy
226226 resource owner under this section is accounted for when settling
227227 the total load served by the retail electric provider that serves
228228 that premise owner's load.
229229 (f) A distributed energy resource owner that requests net
230230 metering services for purposes of this section must have metering
231231 devices capable of providing measurements consistent with the
232232 independent organization's settlement requirements.
233233 (g) A transmission and distribution utility may provide to
234234 customers educational information regarding the technical
235235 requirements for the interconnection of distributed energy
236236 resources to the distribution system. The provision of information
237237 under this subsection is not considered a competitive energy
238238 service.
239239 (h) This section does not apply to a purchase or agreement
240240 entered into under Section 39.914 or 39.916.
241241 SECTION 5. (a) This section takes effect only if the Act of
242242 the 88th Legislature, Regular Session, 2023, relating to
243243 nonsubstantive additions to and corrections in enacted codes does
244244 not become law.
245245 (b) Subchapter Z, Chapter 39, Utilities Code, is amended by
246246 adding Section 39.9166 to read as follows:
247247 Sec. 39.9166. DISTRIBUTED ENERGY RESOURCES. (a) A
248248 customer who purchases or leases a distributed energy resource or
249249 enters into a power purchase agreement for a distributed energy
250250 resource in the ERCOT power region is entitled to the information
251251 and disclosures required under Chapter 113, Business & Commerce
252252 Code, as added by Chapter 561 (S.B. 398), Acts of the 87th
253253 Legislature, Regular Session, 2021, and is entitled to protection
254254 from fraudulent, unfair, misleading, or deceptive practices.
255255 (b) An owner or operator of a distributed energy resource
256256 may provide energy or ancillary services in the wholesale market in
257257 the ERCOT power region.
258258 (c) A person who owns or operates a distributed energy
259259 resource in an area in which customer choice has been introduced and
260260 is part of an aggregated distributed energy resource, or has not
261261 individually registered with the commission as its own power
262262 generation company, must sell the surplus electricity that is
263263 produced by the distributed energy resource and not consumed by the
264264 owner's premise to the retail electric provider that serves the
265265 premise's load at a value agreed to between the distributed energy
266266 resource owner and the retail electric provider that serves the
267267 premise's load. The value may be an agreed value based on the
268268 clearing price of energy or ancillary service at the time of day
269269 that the electricity is made available to the grid.
270270 (d) A person who operates an aggregated distributed energy
271271 resource in an area in which customer choice has been introduced is
272272 subject to customer protection rules established by the commission
273273 under Chapter 17 and this chapter.
274274 (e) The independent organization certified under Section
275275 39.151 for the ERCOT power region shall adopt procedures to ensure
276276 that the amount of electricity purchased from a distributed energy
277277 resource owner under this section is accounted for when settling
278278 the total load served by the retail electric provider that serves
279279 that premise owner's load.
280280 (f) A distributed energy resource owner that requests net
281281 metering services for purposes of this section must have metering
282282 devices capable of providing measurements consistent with the
283283 independent organization's settlement requirements.
284284 (g) A transmission and distribution utility may provide to
285285 customers educational information regarding the technical
286286 requirements for the interconnection of distributed energy
287287 resources to the distribution system. The provision of information
288288 under this subsection is not considered a competitive energy
289289 service.
290290 (h) This section does not apply to a purchase or agreement
291291 entered into under Section 39.914 or 39.916.
292292 SECTION 6. For the purposes of Section 39.3515(c)(2),
293293 Utilities Code, as added by this Act, a facility described by
294294 Section 39.914 or 39.916, Utilities Code, may be registered as an
295295 aggregated distributed energy resource with the Public Utility
296296 Commission of Texas if:
297297 (1) the estimated annual amount of electricity to be
298298 produced by the facility was more than the retail electric
299299 customer's estimated annual electricity consumption at the time of
300300 installation, if the facility was installed not more than a year
301301 before the effective date of this Act; or
302302 (2) the actual amount of electricity produced by the
303303 facility was more than the retail electric customer's actual
304304 electricity consumption in the year prior to the facility's
305305 installation, if the facility was installed more than a year before
306306 the effective date of this Act.
307307 SECTION 7. As soon as practicable after the effective date
308308 of this Act, the Public Utility Commission of Texas shall adopt
309309 rules necessary to implement the changes in law made by this Act.
310310 SECTION 8. This Act takes effect immediately if it receives
311311 a vote of two-thirds of all the members elected to each house, as
312312 provided by Section 39, Article III, Texas Constitution. If this
313313 Act does not receive the vote necessary for immediate effect, this
314314 Act takes effect September 1, 2023.