Texas 2023 - 88th Regular

Texas Senate Bill SB857 Compare Versions

Version 1 (Old)

Version 2 (New)

Old	New	Differences
1	1	2023S0114-1 02/10/23
2	2	By: Perry S.B. No. 857
3	3
4	4
5	5	A BILL TO BE ENTITLED
6	6	AN ACT
7	7	relating to the use of the electric generating facility fund to
8	8	finance construction and maintenance of electric generating and
9	9	transmission facilities in the ERCOT power region; authorizing an
10	10	assessment.
11	11	BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
12	12	SECTION 1. Subtitle B, Title 2, Utilities Code, is amended
13	13	by adding Chapter 34 to read as follows:
14	14	CHAPTER 34. ELECTRIC GENERATING FACILITY FUND
15	15	Sec. 34.0101. DEFINITIONS. In this chapter:
16	16	(1) "Advisory committee" means the Electric
17	17	Generating Facility Fund Advisory Committee.
18	18	(2) "Fund" means the electric generating facility fund
19	19	established by Section 49-q, Article III, Texas Constitution.
20	20	(3) "Trust company" means the Texas Treasury
21	21	Safekeeping Trust Company.
22	22	Sec. 34.0102. FUND. (a) The fund is a special fund in the
23	23	state treasury outside the general revenue fund to be administered
24	24	and used, without further appropriation, by the commission to
25	25	provide loans to finance the construction of electric generating
26	26	facilities and associated transmission facilities in the ERCOT
27	27	power region. The commission may establish separate accounts in
28	28	the fund.
29	29	(b) The fund and the fund's accounts are kept and held by the
30	30	trust company for and in the name of the commission. The commission
31	31	has legal title to money and investments in the fund until money is
32	32	disbursed from the fund as provided by this chapter and commission
33	33	rules.
34	34	(c) Money deposited to the credit of the fund may be used
35	35	only as provided by this chapter.
36	36	(d) The fund consists of:
37	37	(1) money transferred or deposited to the credit of
38	38	the fund by or as authorized by law, including money from any source
39	39	transferred or deposited to the credit of the fund at the
40	40	commission's discretion;
41	41	(2) revenue, including the proceeds of any fee,
42	42	assessment, or tax imposed by this state, that general law
43	43	dedicates for deposit to the credit of the fund; and
44	44	(3) investment earnings and interest earned on money
45	45	in the fund.
46	46	Sec. 34.0103. LOANS. (a) The commission may use money in
47	47	the fund to:
48	48	(1) make a loan to finance construction or maintenance
49	49	of:
50	50	(A) a facility that uses natural gas, clean coal,
51	51	nuclear energy, or another source of heat to generate electricity;
52	52	(B) a hydroelectric generating facility; or
53	53	(C) an essential interconnecting transmission
54	54	facility necessary to effect a sale of electric energy at wholesale
55	55	from a facility described by Paragraph (A) or (B); and
56	56	(2) pay the necessary and reasonable expenses of
57	57	administering the fund.
58	58	(b) An entity is eligible to receive a loan under this
59	59	chapter only if the entity is authorized by this title to operate
60	60	the type of facility for which the loan is requested.
61	61	(c) The commission shall:
62	62	(1) require that an applicant for a loan include with
63	63	the application proof that the applicant has applied for or been
64	64	issued all federal permits required for the operation of the
65	65	proposed electric generating or transmission facility; and
66	66	(2) give priority to applicants who have been issued
67	67	all federal permits required for the operation of the proposed
68	68	electric generating or transmission facility.
69	69	(d) The amount of a loan for the construction of an electric
70	70	generating facility may not exceed 25 percent of the estimated
71	71	total cost of constructing the facility.
72	72	(e) The commission may make a loan for the maintenance of an
73	73	electric generating or transmission facility only if the commission
74	74	has determined that the ERCOT power region has emergency reserve
75	75	electric generation capacity sufficient to prevent blackout
76	76	conditions caused by shortages of generated power in the ERCOT
77	77	power region.
78	78	(f) The commission:
79	79	(1) may use for loans not more than 80 percent of the
80	80	fund balance per biennium for facilities that use natural gas,
81	81	clean coal, or another source of heat, other than nuclear energy, to
82	82	generate electricity;
83	83	(2) shall use for loans at least 10 percent of the fund
84	84	balance per biennium for nuclear or hydroelectric generating
85	85	facilities; and
86	86	(3) may use for loans not more than 10 percent of the
87	87	fund balance per biennium for transmission facilities described by
88	88	Subsection (a)(1)(C).
89	89	Sec. 34.0104. MANAGEMENT AND INVESTMENT OF FUND. (a) The
90	90	trust company shall hold and invest the fund, and any accounts
91	91	established in the fund, for and in the name of the commission,
92	92	taking into account the purposes for which money in the fund may be
93	93	used. The fund may be invested with the state treasury pool.
94	94	(b) The overall objective for the investment of the fund is
95	95	to maintain sufficient liquidity to meet the needs of the fund while
96	96	striving to preserve the purchasing power of the fund.
97	97	(c) The trust company has any power necessary to accomplish
98	98	the purposes of managing and investing the assets of the fund. In
99	99	managing the assets of the fund, through procedures and subject to
100	100	restrictions the trust company considers appropriate, the trust
101	101	company may acquire, exchange, sell, supervise, manage, or retain
102	102	any kind of investment that a prudent investor, exercising
103	103	reasonable care, skill, and caution, would acquire or retain in
104	104	light of the purposes, terms, distribution requirements, and other
105	105	circumstances of the fund then prevailing, taking into
106	106	consideration the investment of all the assets of the fund rather
107	107	than a single investment.
108	108	(d) The trust company may charge fees to cover its costs
109	109	incurred in managing and investing the fund. The fees must be
110	110	consistent with the fees the trust company charges other state and
111	111	local governmental entities for which it provides investment
112	112	management services. The trust company may recover fees it charges
113	113	under this subsection only from the earnings of the fund.
114	114	(e) The trust company annually shall provide a written
115	115	report to the commission and to the advisory committee with respect
116	116	to the investment of the fund. The trust company shall contract
117	117	with a certified public accountant to conduct an independent audit
118	118	of the fund annually and shall present the results of each annual
119	119	audit to the commission and to the advisory committee. This
120	120	subsection does not affect the state auditor's authority to conduct
121	121	an audit of the fund under Chapter 321, Government Code.
122	122	(f) The trust company shall adopt a written investment
123	123	policy that is appropriate for the fund. The trust company shall
124	124	present the investment policy to the investment advisory board
125	125	established under Section 404.028, Government Code. The investment
126	126	advisory board shall submit to the trust company recommendations
127	127	regarding the policy.
128	128	(g) The commission annually shall provide to the trust
129	129	company a forecast of the cash flows into and out of the fund. The
130	130	commission shall provide updates to the forecasts as appropriate to
131	131	ensure that the trust company is able to achieve the objective
132	132	specified by Subsection (b).
133	133	(h) The trust company shall disburse money from the fund as
134	134	directed by the commission.
135	135	(i) An investment-related contract entered into under this
136	136	section is not subject to Chapter 2260, Government Code.
137	137	Sec. 34.0105. ELECTRIC GENERATING FACILITY FUND ADVISORY
138	138	COMMITTEE. (a) The advisory committee is composed of the following
139	139	seven members:
140	140	(1) the comptroller or a person designated by the
141	141	comptroller;
142	142	(2) three members of the senate appointed by the
143	143	lieutenant governor, including:
144	144	(A) a member of the committee of the senate
145	145	having primary jurisdiction over matters relating to the generation
146	146	of electricity; and
147	147	(B) a member of the committee of the senate
148	148	having primary jurisdiction over finance; and
149	149	(3) three members of the house of representatives
150	150	appointed by the speaker of the house of representatives,
151	151	including:
152	152	(A) a member of the committee of the house of
153	153	representatives having primary jurisdiction over the generation of
154	154	electricity; and
155	155	(B) a member of the committee of the house of
156	156	representatives having primary jurisdiction over finance.
157	157	(b) The commission shall provide staff support for the
158	158	advisory committee.
159	159	(c) An appointed member of the advisory committee serves at
160	160	the will of the person who appointed the member.
161	161	(d) The lieutenant governor shall appoint a co-presiding
162	162	officer of the advisory committee from among the members appointed
163	163	by the lieutenant governor. The speaker of the house of
164	164	representatives shall appoint a co-presiding officer of the
165	165	committee from among the members appointed by the speaker.
166	166	(e) The advisory committee may hold public hearings, formal
167	167	meetings, or work sessions. Either co-presiding officer of the
168	168	advisory committee may call a public hearing, formal meeting, or
169	169	work session of the advisory committee at any time. The advisory
170	170	committee may not take formal action at a public hearing, formal
171	171	meeting, or work session unless a quorum of the committee is
172	172	present.
173	173	(f) Except as otherwise provided by this subsection, a
174	174	member of the advisory committee is not entitled to receive
175	175	compensation for service on the committee or reimbursement for
176	176	expenses incurred in the performance of official duties as a member
177	177	of the committee. Service on the advisory committee by a member of
178	178	the senate or house of representatives is considered legislative
179	179	service for which the member is entitled to reimbursement and other
180	180	benefits in the same manner and to the same extent as for other
181	181	legislative service.
182	182	(g) The advisory committee:
183	183	(1) may provide comments and recommendations to the
184	184	commission for the commission to use in adopting rules regarding
185	185	the use of the fund or on any other matter; and
186	186	(2) shall review the overall operation, function, and
187	187	structure of the fund at least semiannually.
188	188	(h) The advisory committee may adopt rules, procedures, and
189	189	policies as needed to administer this section and implement its
190	190	responsibilities.
191	191	(i) Chapter 2110, Government Code, does not apply to the
192	192	size, composition, or duration of the advisory committee.
193	193	(j) The advisory committee is subject to Chapter 325,
194	194	Government Code (Texas Sunset Act). Unless continued in existence
195	195	as provided by that chapter, the advisory committee is abolished
196	196	and this section expires September 1, 2033.
197	197	Sec. 34.0106. RULES. (a) The commission by rule may
198	198	establish procedures for:
199	199	(1) the application for and award of a loan under this
200	200	chapter; and
201	201	(2) the administration of the fund.
202	202	(b) The commission shall give full consideration to
203	203	comments and recommendations of the advisory committee before it
204	204	adopts rules under this chapter.
205	205	Sec. 34.0107. ELECTRIC GENERATING FACILITY FUND
206	206	ASSESSMENT. (a) An assessment is imposed on the gross receipts of
207	207	each retail electric provider providing retail service in the ERCOT
208	208	power region.
209	209	(b) The commission shall impose the assessment as a
210	210	percentage of gross receipts from rates charged to an ultimate
211	211	consumer in the ERCOT power region and establish the percentage at a
212	212	rate to ensure that the balance of the fund is sufficient to provide
213	213	funding for the construction of electric generating facilities to
214	214	provide emergency reserve generation capacity sufficient to
215	215	prevent blackout conditions caused by shortages of generated power
216	216	in the ERCOT power region. The commission may establish different
217	217	assessments for gross receipts from rates charged to commercial and
218	218	residential customers.
219	219	(c) A retail electric provider may collect from its
220	220	customers the assessment imposed under this section as an
221	221	additional item separately stated on the customer bill as "electric
222	222	generating facility fund assessment."
223	223	(d) The comptroller shall collect the assessment and any
224	224	penalty or interest due under this chapter and deposit the money
225	225	collected in the fund on a schedule determined by the comptroller.
226	226	The comptroller may impose a late payment penalty of not more than
227	227	10 percent of the amount due for a late payment of an assessment
228	228	required under this chapter. The comptroller may collect interest
229	229	on an assessment payment that is delinquent for more than 30 days at
230	230	an annual rate of 12 percent on the amount of the assessment and any
231	231	penalty due.
232	232	SECTION 2. This Act takes effect on the date on which the
233	233	constitutional amendment proposed by the 88th Legislature, Regular
234	234	Session, 2023, providing for the creation of the electric
235	235	generating facility fund to finance construction and maintenance of
236	236	electric facilities is approved by the voters. If that amendment is
237	237	not approved by the voters, this Act has no effect.