Texas 2025 - 89th Regular

Texas House Bill HB4817 Compare Versions

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1	1		By: Virdell H.B. No. 4817
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4	6		A BILL TO BE ENTITLED
5	7		AN ACT
6	8		relating to reliability requirements and associated locational
7	9		marginal pricing for certain electric generation facilities.
8	10		BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
9	11		SECTION 1. Section 39.1592, Utilities Code, is amended to
10	12		read as follows:
11	13		Sec. 39.1592. GENERATION RELIABILITY REQUIREMENTS. (a)
12	14		This section applies only to an electric generation facility in the
13	15		ERCOT power region [for which a standard generator interconnection
14	16		agreement is signed on or after January 1, 2027,] that has been in
15	17		operation for at least one year, and that is not a self-generator.
16	18		(a-1) In this section:
17	19		(1) "Pooling" or "pooled generation" means a
18	20		combination of electric generation facilities in the same load zone
19	21		that elect to meet the reliability standard established under this
20	22		Section by sharing, supplementing, or contracting with on-site or
21	23		off-site resources.
22	24		(2) "Reliability standard" means the percentage of an
23	25		electric generation facility's nameplate capacity that is
24	26		available to be dispatched under most operating conditions absent
25	27		extreme circumstances.
26	28		(b) Not later than January 1, 2027[December 1 of each year],
27	29		the commission shall establish a single reliability standard for
28	30		all electric generation facilities. The commission may adjust the
29	31		reliability standard but may not require less than the ability to
30	32		run at an availability of 50 percent of the nameplate capacity of
31	33		the equipment operated by the generator. [an owner or operator of
32	34		an electric generation facility, other than a battery energy
33	35		storage resource, shall demonstrate to the commission the ability
34	36		of the owner or operator's portfolio to operate or be available to
35	37		operate when called on for dispatch at or above the seasonal average
36	38		generation capability during the times of highest reliability risk,
37	39		as determined by the commission, due to low operation reserves, as
38	40		determined by the commission. The owner or operator of an electric
39	41		generation facility must be allowed to meet the reliability
40	42		standard established under[performance requirements described by]
41	43		this subsection by pooling with other electrical generation
42	44		facilities within the same load zone. [supplementing or
43	45		contracting with on-site or off-site resources, including battery
44	46		energy storage resources. The commission shall determine the
45	47		average generation capability based on expected resource
46	48		availability and seasonal-rated capacity on a standalone basis.]
47	49		(c) The commission shall adopt rules for calculating a
48	50		settlement price cap, accounting for all subsidies available, for
49	51		electric generation facilities that opt out of the reliability
50	52		standard established under Subsection (b). The settlement price
51	53		cap for electric generation facilities that opt-out of the
52	54		reliability standard:
53	55		(1) shall not be greater than $50 per megawatt hour on
54	56		January 1, 2027; and
55	57		(2) shall not be greater than $30 per megawatt hour on
56	58		or before January 1, 2037. [The commission shall require the
57	59		independent organization certified under Section 39.151 for the
58	60		ERCOT power region to:
59	61		(1) enforce the requirements of Subsection (b) by
60	62		imposing financial penalties, as determined by the commission, for
61	63		failing to comply with the performance requirements described by
62	64		that subsection; and
63	65		(2) provide financial incentives, as determined by the
64	66		commission, for exceeding the performance requirements described
65	67		by that subsection.]
66	68		(d) The real-time settlement price for electric generation
67	69		facilities that opt-out of the reliability standard established
68	70		under Subsection (b) may not fall below $0 per megawatt hour.
69	71		(e) An electric generation facility that opts-out of the
70	72		reliability standard under Subsection (b) and sells power when the
71	73		real-time settlement price is between $0 per megawatt hour and the
72	74		cap calculated under Subsection (c) shall receive the real-time
73	75		settlement price. At no time shall an electric generation facility
74	76		that opts-out of the reliability standard under Subsection (b)
75	77		receive more than the cap calculated under Subsection (c).
76	78		(f) Any revenue from power sold in the ERCOT market subject
77	79		to the settlement price cap calculated under Subsection (c) shall
78	80		be subtracted from the total generation billed to all Retail
79	81		Electric Providers for each period the power is sold.
80	82		(g) The commission shall establish set dates for each owner
81	83		or operator of an electric generation facility or pooled generation
82	84		facility to elect to meet the reliability standard established
83	85		under Subsection (b), which shall not be more often than four times
84	86		per year.
85	87		(h) Electric generation facilities that elect to meet the
86	88		reliability standard established under Subsection (b) by pooling
87	89		must meet the reliability standard based upon the combined
88	90		nameplate capacity of the pooled generation sites. Pooled
89	91		generation facilities must bid into the market as a single
90	92		generation site.
91	93		(i) Any owner or operator of an electric generation facility
92	94		or pooled generation facility that made the election under
93	95		Subsection (g), but failed to meet the reliability standard
94	96		established under Subsection (b) shall pay the difference between
95	97		the replacement power to cover the load lost and the offered price
96	98		of the undelivered load on the real-time market. Should the offered
97	99		price of the generation facility or pooled generation facility be
98	100		greater than 80 percent of the high system-wide offer cap, any
99	101		failure to meet the reliability standard shall be calculated at 80
100	102		percent of the high system-wide offer cap instead of the offered
101	103		price.
102	104		(j) A penalty assessed against an owner or operator of an
103	105		electric generation facility or pooled generation facility under
104	106		Subsection (i) shall be subtracted from the total generation billed
105	107		to all Retail Electric Providers for each period such penalty is
106	108		assessed.
107	109		(l)[(d)] The independent organization certified under
108	110		Section 39.151 for the ERCOT power region may not impose penalties
109	111		under Subsection (h)[(c)]:
110	112		(1) for resource unavailability due to planned
111	113		maintenance outages or transmission outages; or
112	114		(2) on resources that are already subject to
113	115		performance obligations during the highest reliability risk hours
114	116		under the day-ahead market rules or other ancillary or reliability
115	117		services established by the commission or the independent
116	118		organization.[;or
117	119		(3) during hours outside a baseline established by the
118	120		commission that includes morning and evening ramping periods.]
119	121		SECTION 2. This Act takes effect September 1, 2025.