Texas 2025 - 89th Regular

Texas House Bill HB4577 Compare Versions

Version 1 (Old)

Version 2 (New)

Old	New		Differences
1	1		By: Harrison H.B. No. 4577
	2	+
	3	+
2	4
3	5
4	6		A BILL TO BE ENTITLED
5	7		AN ACT
6	8		relating to the reliability of the ERCOT power grid.
7	9		BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
8	10		SECTION 1. Section 39.1591, Utilities Code, is amended to
9	11		read as follows:
10	12		Sec. 39.1591. REPORT ON DISPATCHABLE AND NON-DISPATCHABLE
11	13		GENERATION FACILITIES. Not later than December 1 of each year, the
12	14		commission shall file a report with the legislature that:
13	15		(1) includes:
14	16		(A) the estimated annual costs incurred by
15	17		load-serving entities and generation facilities under this
16	18		subchapter associated with backing up dispatchable and
17	19		non-dispatchable electric generation facilities to guarantee that
18	20		a firm amount of electric energy will be available to the ERCOT
19	21		power grid; and
20	22		(B) as calculated by the independent system
21	23		operator, the cumulative annual costs that have been incurred in
22	24		the ERCOT market to facilitate the transmission of dispatchable and
23	25		non-dispatchable electricity to load and to interconnect
24	26		transmission level loads, including a statement of the total
25	27		cumulative annual costs and of the cumulative annual costs incurred
26	28		for each type of activity described by this paragraph; [and]
27	29		(2) documents the status of the implementation of this
28	30		subchapter, including whether the rules and protocols adopted to
29	31		implement this subchapter have materially improved the
30	32		reliability, resilience, and transparency of the electricity
31	33		market; and
32	34		(3) recommends any additional legislative measures
33	35		necessary to ensure that market signals are adequate to preserve
34	36		existing dispatchable generation and incentivize the construction
35	37		of new dispatchable generation capacity sufficient to meet the
36	38		reliability requirements adopted under Section 39.159 for at least
37	39		five years from the date of the report.
38	40		SECTION 2. Section 39.1592, Utilities Code, is amended to
39	41		read as follows:
40	42		Sec. 39.1592. GENERATION RELIABILITY REQUIREMENTS. (a)
41	43		This section applies only to an electric generation facility in the
42	44		ERCOT power region that is subject to [for which] a standard
43	45		generator interconnection agreement, [ is signed on or after
44	46		January 1, 2027, that]has been in operation for at least one year,
45	47		and [that] is not a self-generator.
46	48		(a-1) For the purposes of this section, a generation
47	49		facility is considered to be non-dispatchable if the facility's
48	50		output is controlled primarily by forces outside of human control.
49	51		(b) Not later than December 1 of each year, an owner or
50	52		operator of a non-dispatchable [an electric] generation facility [,
51	53		other than a battery energy storage resource,] shall demonstrate to
52	54		the commission the ability of the facility to ensure that during at
53	55		least 95 hours of the highest 100 net load hours to occur in the next
54	56		calendar year the facility's hourly availability factor, as
55	57		determined under Subsection (b-1), will equal or exceed the
56	58		facility's expected availability factor, as determined under
57	59		Subsection (b-2).
58	60		(b-1) The commission shall determine a non-dispatchable
59	61		generation facility's hourly availability factor by dividing the
60	62		facility's hourly average generation by the facility's installed
61	63		capacity.
62	64		(b-2) The commission shall determine a non-dispatchable
63	65		generation facility's expected availability factor by calculating
64	66		the average generation of the facility, divided by the facility's
65	67		installed capacity, during the highest 100 net load hours each
66	68		calendar year in an average of two or more immediately preceding
67	69		calendar years, [owner or operator's portfolio to operate or be
68	70		available to operate when called on for dispatch at or above the
69	71		seasonal average generation capability during the times of highest
70	72		reliability risk, as determined by the commission, due to low
71	73		operation reserves,] as determined by the commission.
72	74		(b-3) The owner or operator may [must be allowed to] meet
73	75		the performance requirements described by this section
74	76		[subsection] only by operating, constructing, or acquiring
75	77		resources that are eligible to act as ancillary service reserves
76	78		according to the protocols of the independent organization
77	79		certified for the ERCOT power region under Section 39.151
78	80		[supplementing or contracting with on-site or off-site resources,
79	81		including battery energy storage resources. The commission shall
80	82		determine the average generation capability based on expected
81	83		resource availability and seasonal-rated capacity on a standalone
82	84		basis].
83	85		(c) The commission shall require the independent
84	86		organization certified under Section 39.151 for the ERCOT power
85	87		region to:
86	88		(1) enforce the requirements of this section
87	89		[Subsection (b)] by imposing financial penalties, as determined by
88	90		the commission, for failing to comply with the performance
89	91		requirements described by this section [that subsection]; and
90	92		(2) provide financial incentives, as determined by the
91	93		commission, for exceeding the performance requirements described
92	94		by this section [that subsection].
93	95		(d) The independent organization certified under Section
94	96		39.151 for the ERCOT power region may not impose penalties under
95	97		Subsection (c):
96	98		(1) for resource unavailability due to planned
97	99		maintenance outages or transmission outages; or
98	100		(2) on resources that are already subject to
99	101		performance obligations [during the highest reliability risk
100	102		hours] under the day-ahead market rules or other ancillary or
101	103		reliability services established by the commission or the
102	104		independent organization[; or
103	105		[(3) during hours outside a baseline established by
104	106		the commission that includes morning and evening ramping periods].
105	107		(e) The commission by rule may establish an ancillary
106	108		service market or a separate reliability service to implement this
107	109		section.
108	110		SECTION 3. The owner or operator of a generation facility to
109	111		which Section 39.1592(b), Utilities Code, as amended by this Act,
110	112		applies shall make the first demonstration required by that section
111	113		not later than December 1, 2026.
112	114		SECTION 4. This Act takes effect September 1, 2025.