By: Creighton S.B. No. 1963
(In the Senate - Filed March 5, 2025; March 17, 2025, read
first time and referred to Committee on Business & Commerce;
April 9, 2025, reported favorably by the following vote: Yeas 9,
Nays 1; April 9, 2025, sent to printer.)
Click here to see the committee vote
A BILL TO BE ENTITLED
AN ACT
relating to a financing mechanism allowing electric utilities to
obtain recovery of costs associated with a weather-related event or
other natural disaster; granting authority to issue bonds.
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
SECTION 1. Section 36.451, Utilities Code, is amended by
amending Subsection (b) and adding Subsection (i) to read as
follows:
(b) The purpose of this subchapter is to make available a
lower-cost, supplemental financing mechanism to allow an electric
utility [operating solely outside of ERCOT] to obtain timely
recovery of system restoration costs under Subchapter I through
securitization and the issuance of transition bonds or system
restoration bonds by an issuer other than the electric utility or an
affiliated special purpose entity. Financing of system restoration
costs under this subchapter is a valid and essential public
purpose.
(i) Notwithstanding Section 36.403(j), an electric utility
may apply for securitization and the issuance of system restoration
bonds under this subchapter for estimated and actual system
restoration costs of $50 million or more in any calendar year.
SECTION 2. Section 36.456, Utilities Code, is amended by
adding Subsections (b-1), (b-2), and (b-3) to read as follows:
(b-1) Notwithstanding Sections 36.405(c) and (d), an
electric utility may file an application with the commission under
this subchapter for:
(1) a determination of the amount of estimated and
actual system restoration costs eligible for recovery and
securitization; and
(2) a financing order that authorizes the
securitization of estimated and actual system restoration costs,
the issuance of system restoration bonds, and the creation of
system restoration charges for the recovery of qualified costs.
(b-2) For an application filed under Subsection (b-1), the
commission shall issue an order that determines the amount of
estimated and actual system restoration costs eligible for recovery
and securitization and a financing order that authorizes the
securitization of estimated and actual system restoration costs,
the issuance of system restoration bonds, and the creation of
system restoration charges for the recovery of qualified costs not
later than the 150th day after the date the application is filed.
(b-3) For an application filed under Subsection (b-1), the
estimated system restoration costs shall be subject to true-up and
reconciliation and system restoration charges shall be adjusted
after the actual system restoration costs are known.
SECTION 3. This Act takes effect immediately if it receives
a vote of two-thirds of all the members elected to each house, as
provided by Section 39, Article III, Texas Constitution. If this
Act does not receive the vote necessary for immediate effect, this
Act takes effect September 1, 2025.
* * * * *