Bill Text: TX SB1378 | 2023-2024 | 88th Legislature | Introduced
Bill Title: Relating to the procurement and operation of backup generation facilities for the ERCOT power region.
Spectrum: Partisan Bill (Republican 1-0)
Status: (Introduced - Dead) 2023-03-16 - Referred to Business & Commerce [SB1378 Detail]
Download: Texas-2023-SB1378-Introduced.html
| 88R13225 JXC-D | ||
| By: Parker | S.B. No. 1378 | |
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| relating to the procurement and operation of backup generation | ||
| facilities for the ERCOT power region. | ||
| BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS: | ||
| SECTION 1. Section 31.002, Utilities Code, is amended by | ||
| adding Subdivision (3-a) to read as follows: | ||
| (3-a) "Backup generation facility" means an electric | ||
| generation facility operated under Subchapter O, Chapter 39. | ||
| SECTION 2. Section 35.004(b), Utilities Code, is amended to | ||
| read as follows: | ||
| (b) The commission shall ensure that an electric utility or | ||
| transmission and distribution utility provides nondiscriminatory | ||
| access to wholesale transmission service for qualifying | ||
| facilities, exempt wholesale generators, power marketers, power | ||
| generation companies, retail electric providers, backup generation | ||
| facility operators, and other electric utilities or transmission | ||
| and distribution utilities. | ||
| SECTION 3. Section 35.005(a), Utilities Code, is amended to | ||
| read as follows: | ||
| (a) The commission may require an electric utility to | ||
| provide transmission service at wholesale to another electric | ||
| utility, a qualifying facility, an exempt wholesale generator, a | ||
| backup generation facility operator, or a power marketer and may | ||
| determine whether terms for the transmission service are | ||
| reasonable. | ||
| SECTION 4. Chapter 39, Utilities Code, is amended by adding | ||
| Subchapter O to read as follows: | ||
| SUBCHAPTER O. BACKUP GENERATION FACILITIES | ||
| Sec. 39.701. PURPOSE; LIMITATION. (a) The purpose of this | ||
| subchapter is to establish a program to allow the comptroller, in | ||
| consultation with the commission, to contract with entities for the | ||
| construction and operation of at least 5,000 megawatts of | ||
| generating capacity powered by nuclear energy or natural gas for | ||
| the ERCOT power region. | ||
| (b) Not later than January 31, 2024, the commission shall | ||
| determine whether market participants have contracted for the | ||
| installation of at least 5,000 megawatts of new generation capacity | ||
| for the ERCOT power region compared to the amount of installed | ||
| generation capacity on January 1, 2023. | ||
| (c) If the commission determines under Subsection (b) that | ||
| market participants have contracted for the installation of at | ||
| least 5,000 megawatts of new generation capacity for the ERCOT | ||
| power region, the comptroller may not enter into a contract under | ||
| this subchapter. | ||
| Sec. 39.702. CONSTRUCTION AND OPERATION OF BACKUP | ||
| GENERATION FACILITY. (a) The comptroller may contract with one or | ||
| more entities to construct or operate backup generation facilities | ||
| in the manner provided by this subchapter. The comptroller may use | ||
| any procurement method that provides the best value to the state, | ||
| including a method authorized by Chapter 2267, Government Code. | ||
| (b) A contract must provide that an entity that constructs | ||
| or operates a backup generation facility: | ||
| (1) is entitled to payments from the state for the | ||
| construction or operation of a backup generation facility equal to | ||
| 103 percent of the actual costs of constructing or operating the | ||
| facility; | ||
| (2) is not entitled to sell electric energy from the | ||
| backup generation facility; | ||
| (3) may not sell the backup generation facility | ||
| without the permission of the comptroller; and | ||
| (4) shall provide electric energy for the ERCOT power | ||
| region as directed by the independent system operator in times of | ||
| high demand and low supply. | ||
| (c) A backup generation facility constructed under this | ||
| subchapter: | ||
| (1) is the property of the state; and | ||
| (2) is not considered to be installed generation | ||
| capacity for the purposes of Sections 39.154 and 39.158. | ||
| (d) An entity is eligible to operate a backup generation | ||
| facility under this subchapter only if the entity is authorized by | ||
| this title to generate electric energy at wholesale. | ||
| (e) If a backup generation facility is constructed under | ||
| this subchapter, the commission shall: | ||
| (1) annually evaluate the reserve margin for the ERCOT | ||
| power region; and | ||
| (2) determine whether the reserve margin equals at | ||
| least 15 percent of peak electric demand over the preceding two | ||
| years. | ||
| (f) If the condition under Subsection (e)(2) is met, the | ||
| comptroller shall sell each backup generation facility constructed | ||
| under this subchapter. | ||
| SECTION 5. 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, 2023. | ||
