89R7760 JXC-D
By: Kolkhorst, et al. S.B. No. 1022
A BILL TO BE ENTITLED
AN ACT
relating to the recovery of vegetation management costs by electric
utilities.
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
SECTION 1. Subchapter E, Chapter 36, Utilities Code, is
amended by adding Section 36.2031 to read as follows:
Sec. 36.2031. VEGETATION MANAGEMENT COST RECOVERY;
ADJUSTMENT OF VEGETATION MANAGEMENT FACTOR. (a) Section 36.201
does not prohibit the commission from reviewing and providing for
adjustments of an electric utility's vegetation management factor.
(b) The commission by rule shall implement procedures that
provide for the timely adjustment of an electric utility's
vegetation management factor. The rules must require that the
findings required by Section 36.058 regarding vegetation
management transactions with affiliated interests be made in a
vegetation management reconciliation proceeding or in a rate case
filed under Subchapter C or D. The rules must ensure that:
(1) the utility collects as contemporaneously as
reasonably possible the vegetation management costs that the
utility incurs and that the commission determines are eligible;
(2) the total of the utility's eligible vegetation
management costs, including any under-collected or over-collected
amounts to be recovered through an interim adjustment, is allocated
among customer classes based on actual historical calendar month
usage;
(3) any material balance of amounts under-collected or
over-collected for eligible vegetation management costs is
collected from or refunded to customers through an interim
adjustment:
(A) not later than the 90th day after the date the
balance is accrued; or
(B) if the adjustment would result in a total
bill increase of 10 percent or more compared to the total bill in
the month before implementation, not later than a date ordered by
the commission which must be after the 90th day after the date the
balance is accrued; and
(4) an affected party will receive notice and have the
opportunity to request a hearing before the commission.
(c) Notwithstanding Subsection (b)(3), on a finding that an
electric utility has an under-collected balance that is the result
of extraordinary vegetation management costs that are unlikely to
continue, the commission may approve an interim vegetation
management adjustment that would defer recovery to take place over
a period longer than 90 days.
(d) The commission is not required to hold a hearing on the
adjustment of an electric utility's vegetation management factor
under this section. If the commission holds a hearing, the
commission may consider at the hearing any evidence that is
appropriate and in the public interest.
(e) A customer of the electric utility, a municipality with
original jurisdiction over the utility, or the office may protest a
vegetation management factor or interim adjustment proposed under
this section. The prudence of costs may not be considered in a
vegetation management factor or interim adjustment proceeding and
may only be considered in a vegetation management reconciliation
proceeding under Subsection (h) or another appropriate proceeding.
(f) The sole issue that may be considered on a protest of a
vegetation management factor under Subsection (e) is whether the
factor reasonably reflects costs the electric utility will incur so
that the utility will not substantially under-collect or
over-collect the utility's reasonably stated vegetation management
costs on an ongoing basis. The commission may adjust the utility's
vegetation management factor based on its determination on that
issue.
(g) The commission shall hold a hearing on a protest of an
interim adjustment under Subsection (e) if the adjustment would
result in a total bill increase of 10 percent or more as described
by Subsection (b)(3) or if the adjustment results from
extraordinary vegetation management costs as described by
Subsection (c). In response to a protest of an interim adjustment,
if the commission finds that the electric utility is in a state of
material under-collection or over-collection of the utility's
reasonably stated eligible vegetation management costs and is
projected to remain in that state on an ongoing basis, the
commission shall order the utility to establish or modify an
interim adjustment to address the under-collection or
over-collection in a manner consistent with this section.
(h) An electric utility shall apply to reconcile the
vegetation management costs at least once every two years. The
application must be made not later than the 180th day after the last
day of the period to be reconciled. The commission may by rule
establish the calendar year timing of the reconciliation period for
each electric utility subject to this section to facilitate
efficient work by the commission. To the extent a reconciliation
results in a change to the electric utility's under-collected or
over-collected vegetation management balance, that change may be
incorporated into an interim adjustment as directed by the
commission.
(i) A proceeding under this section is not a rate case under
Subchapter C.
SECTION 2. This Act takes effect September 1, 2025.