Texas House Bill HB3896

Texas 2025 - 89th Regular

• Filed: 3/6/25
• Out of House Committee: 4/28/25
• Voted on by House: 5/8/25

Caption

Relating to the generation of electric power by a water supply or sewer service corporation.

Impact

The legislative discussions around HB 3896 suggest a favorable outlook for the bill, particularly among utilities aiming to improve their operational costs. By allowing corporations serving smaller populations (under 350,000) to generate excess electricity for sale, the bill could positively impact local economies by fostering community-funded projects through the additional revenue generated. The requirement for these corporations to register as power generation companies aligns with regulatory standards, which can ensure oversight and proper assessment of their operations.

Summary

House Bill 3896 is designed to empower water supply or sewer service corporations in Texas the ability to generate electric power for their operational needs. The bill specifies that these corporations can produce electricity primarily for their pumps and infrastructure handling raw and potable water, with a provision to sell any excess electric power they generate in the ERCOT power region. This approach aims to enhance operational efficiency and potentially create new revenue streams for these utilities under certain conditions, primarily emphasizing their core functions.

Sentiment

The sentiment toward HB 3896 has been generally positive within the committee discussions, reflecting a recognition of the need for innovative solutions to operating expenses and infrastructure funding challenges faced by smaller water and sewer utilities. However, there are concerns regarding the environmental considerations of power generation and ensuring that the focus remains on maximizing benefits for local communities rather than solely profit-driven motives.

Contention

While there is broad support for the bill, some stakeholders express unease about the implications of allowing public utilities to engage in commercial power generation. Critics worry that this could lead to conflicts of interest where utility priorities may shift away from public service towards profitability. Furthermore, vigilance is emphasized in monitoring the environmental impact and regulatory compliance of these utilities as they enter the power market, ensuring both community interests and ecological sustainability are upheld.

Texas Constitutional Statutes Affected

Water Code

• Chapter 67. Nonprofit Water Supply Or Sewer Service Corporations
  • Section: New Section
  • Section: New Section
  • Section: 004
  • Section: New Section
  • Section: New Section

Utilities Code

• Chapter 39. Restructuring Of Electric Utility Industry
  • Section: 351
  • Section: 351
  • Section: 351
  • Section: 351

• Chapter 31. General Provisions
  • Section: New Section