Bill Text: TX HB3916 | 2021-2022 | 87th Legislature | Engrossed
Bill Title: Relating to the interconnection and operation of certain distributed electric generation facilities for the food supply chain.
Spectrum: Bipartisan Bill
Status: (Engrossed - Dead) 2021-05-17 - Referred to Business & Commerce [HB3916 Detail]
Download: Texas-2021-HB3916-Engrossed.html
By: Goldman, Reynolds | H.B. No. 3916 |
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relating to the interconnection and operation of certain | ||
distributed electric generation facilities for the food supply | ||
chain. | ||
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS: | ||
SECTION 1. It is the intent of the legislature in enacting | ||
Section 35.037, Utilities Code, to allow grocers the ability to | ||
deploy back-up generation in the ERCOT power region in areas that | ||
have not implemented retail customer choice. | ||
SECTION 2. Subchapter B, Chapter 35, Utilities Code, is | ||
amended by adding Section 35.037 to read as follows: | ||
Sec. 35.037. INTERCONNECTION AND OPERATION OF CERTAIN | ||
DISTRIBUTED GENERATION FACILITIES FOR FOOD SUPPLY CHAIN. (a) In | ||
this section: | ||
(1) "Customer" means a retail electric customer: | ||
(A) with a distributed generation facility | ||
installed on the retail electric customer's side of the meter; and | ||
(B) that has a primary purpose of or derives a | ||
material source of revenue from: | ||
(i) retail grocery sales; or | ||
(ii) food manufacturing or distribution for | ||
retail grocery sales. | ||
(2) "Distributed generation facility" means a | ||
facility installed on the customer's side of the meter but | ||
separately metered from the customer: | ||
(A) with a nameplate capacity of at least 250 | ||
kilowatts and not more than 10 megawatts; | ||
(B) that is capable of generating and providing | ||
backup or supplementary power to the customer's premises; and | ||
(C) that is owned or operated by a person | ||
registered as a power generation company in accordance with Section | ||
39.351. | ||
(b) This section only applies in the ERCOT power region in | ||
areas where retail customer choice has not been implemented. | ||
(c) A person who owns or operates a distributed generation | ||
facility served by a municipally owned utility or electric | ||
cooperative in the ERCOT power region may sell electric power | ||
generated by the distributed generation facility at wholesale, | ||
including the provision of ancillary services. | ||
(d) A person who owns or operates a distributed generation | ||
facility may sell electric power generated by the distributed | ||
generation facility at wholesale to a municipally owned utility or | ||
electric cooperative certificated for retail service to the area | ||
where the distributed generation facility is located or to a | ||
related generation and transmission electric cooperative. The | ||
municipally owned utility or electric cooperative shall purchase | ||
the quantity of electric power generated by the distributed | ||
generation facility needed to satisfy the full electric | ||
requirements of the customer on whose side of the meter the | ||
distributed generation facility is installed and operated at a | ||
wholesale price agreed to by the customer and shall resell that | ||
quantity of power at retail to the customer at the rate applicable | ||
to the customer for retail service, which must include all amounts | ||
paid for the wholesale electric power, during: | ||
(1) an emergency declared by the independent | ||
organization certified under Section 39.151 for the ERCOT power | ||
region that creates the potential for interruption of service to | ||
the customer; | ||
(2) any service interruption at the customer's | ||
premises; | ||
(3) construction on the customer's premises that | ||
creates the potential for interruption of service to the customer; | ||
(4) maintenance and testing of the distributed | ||
generation facility; and | ||
(5) additional times mutually agreed on by the owner | ||
or operator of the distributed generation facility and the | ||
municipally owned utility or electric cooperative. | ||
(e) The customer shall provide written notice as soon as | ||
reasonably practicable to the municipally owned utility or electric | ||
cooperative of a circumstance described by Subsection (d)(3) or | ||
(4). | ||
(f) In addition to a sale authorized under Subsection (d), | ||
on request by an owner or operator of a distributed generation | ||
facility, the municipally owned utility or electric cooperative | ||
shall provide wholesale transmission service to the distributed | ||
generation facility owner in the same manner as to other power | ||
generation companies for the sale of power from the distributed | ||
generation facility at wholesale, including for the provision of | ||
ancillary services, in the ERCOT market. The distributed generation | ||
facility owner shall comply with all applicable commission rules | ||
and protocols and with governing documents of the independent | ||
organization certified under Section 39.151 for the ERCOT power | ||
region. This subsection does not require a municipally owned | ||
utility or electric cooperative to transmit electricity to a retail | ||
point of delivery in the certificated service area of the | ||
municipally owned utility or electric cooperative. | ||
(g) In addition to a sale authorized under Subsection (d) or | ||
(f), a municipally owned utility or electric cooperative or related | ||
generation and transmission electric cooperative may purchase | ||
electric power provided by the owner or operator of the distributed | ||
generation facility at wholesale at a mutually agreed on price. The | ||
price may be based wholly or partly on the ERCOT market clearing | ||
price of energy at the time of day and at the location at which the | ||
electric power is made available. | ||
(h) A municipally owned utility or electric cooperative | ||
shall make available a standard interconnection application and | ||
agreement for distributed generation facilities that is | ||
substantially similar to the commission's distributed generation | ||
interconnection agreement form and consistent with this section to | ||
facilitate the connection of distributed generation facilities. A | ||
municipally owned utility or electric cooperative shall allow | ||
interconnection of a distributed generation facility and provide to | ||
a distributed generation facility on a nondiscriminatory basis | ||
wholesale transmission service, including at distribution voltage, | ||
in the same manner as for other power generation companies to | ||
transmit to the ERCOT power grid the electric power generated by the | ||
distributed generation facility. A municipally owned utility or | ||
electric cooperative may recover from the owner or operator of the | ||
distributed generation facility all reasonable costs necessary for | ||
and directly attributable to the interconnection of the facility, | ||
including the reasonable costs of necessary system upgrades and | ||
improvements directly attributable to the distributed generation | ||
facility. | ||
(i) Not later than the 30th day after the date a complete | ||
application for interconnection of a distributed generation | ||
facility is received, the municipally owned utility or electric | ||
cooperative shall provide the applicant with a written good faith | ||
cost estimate for interconnection-related costs. The municipally | ||
owned utility or electric cooperative may not incur any | ||
interconnection-related costs without entering into a written | ||
agreement for the payment of those costs by the applicant. | ||
(j) The process to interconnect a distributed generation | ||
facility must be completed not later than the 240th day after the | ||
date the municipally owned utility or electric cooperative receives | ||
payment of all estimated costs to complete the interconnection, | ||
except that: | ||
(1) the period may be extended by written agreement | ||
between the parties; and | ||
(2) the period may be extended after a good faith | ||
showing by the municipally owned utility or electric cooperative | ||
that the interconnection requires improvements, upgrades, or | ||
construction of new facilities that cannot reasonably be completed | ||
within that period, in which case the period may be extended for a | ||
time not to exceed the time necessary for the improvements, | ||
upgrades, or construction of new facilities to be completed. | ||
(k) A municipally owned utility or electric cooperative | ||
shall charge the owner or operator of a distributed generation | ||
facility rates on a reasonable and nondiscriminatory basis for | ||
providing wholesale transmission service to the distributed | ||
generation facility owner in the same manner as for other power | ||
generation companies to transmit to the ERCOT power grid the | ||
electric power generated by the distributed generation facility in | ||
accordance with a tariff filed by the municipally owned utility or | ||
electric cooperative with the commission. | ||
(l) The owner or operator of the distributed generation | ||
facility shall contract with the municipally owned utility or | ||
electric cooperative or the municipally owned utility's or electric | ||
cooperative's designee for any scheduling, settlement, | ||
communication, telemetry, or other services required to | ||
participate in the ERCOT wholesale market, but only to the extent | ||
that the utility, cooperative, or designee offers the services on a | ||
nondiscriminatory basis and at a commercially reasonable cost. If | ||
the municipally owned utility or electric cooperative or the | ||
municipally owned utility's or electric cooperative's designee does | ||
not offer or declines to offer the services, or fails to do so on a | ||
nondiscriminatory basis and at a commercially reasonable cost as | ||
determined by quotes from at least three third parties providing | ||
the same services, the owner or operator of the distributed | ||
generation facility may contract with a third party provider to | ||
obtain the services. | ||
(m) A distributed generation facility must comply with | ||
emissions limitations established by the Texas Commission on | ||
Environmental Quality for a standard emissions permit for an | ||
electric generation facility unit installed after January 1, 1995. | ||
(n) A municipally owned utility or electric cooperative is | ||
not required to interconnect a distributed generation facility | ||
under this section if, on the date the utility or cooperative | ||
receives an application for interconnection of the facility, the | ||
municipally owned utility or electric cooperative has | ||
interconnected distributed generation facilities with an aggregate | ||
capacity that equals the lesser amount of: | ||
(1) 5 percent of the municipally owned utility's or | ||
electric cooperative's average of the 15-minute summer peak load | ||
coincident with the independent system operator's 15-minute summer | ||
peak load in each of the months of June, July, August, and | ||
September; or | ||
(2) 300 megawatts, adjusted annually by the percentage | ||
of total system load growth in the ERCOT power region beginning in | ||
2022. | ||
(o) A municipally owned utility or electric cooperative | ||
that, on the date the utility or cooperative receives an | ||
application for interconnection of a distributed generation | ||
facility, has interconnected distributed generation facilities | ||
with an aggregate capacity less than the threshold described by | ||
Subsection (n) is required to increase that capacity only up to that | ||
threshold. | ||
(p) This section is not intended to change registration | ||
standards or other qualifications required by the independent | ||
organization certified under Section 39.151 for the ERCOT power | ||
region related to the participation of distributed generation | ||
facilities in the wholesale market. This section is not intended to | ||
allow distributed generation facilities to participate in a manner | ||
that is not technically feasible or that is otherwise in conflict | ||
with wholesale rules and requirements adopted by the independent | ||
organization certified under Section 39.151 for the ERCOT power | ||
region. | ||
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, 2021. |