Bill Text: TX SB1075 | 2023-2024 | 88th Legislature | Comm Sub
Bill Title: Relating to facilities and construction machinery used to respond to power outages.
Spectrum: Partisan Bill (Republican 2-0)
Status: (Engrossed - Dead) 2023-05-23 - Placed on General State Calendar [SB1075 Detail]
Download: Texas-2023-SB1075-Comm_Sub.html
By: King | S.B. No. 1075 | |
(Guillen) | ||
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relating to facilities and construction machinery used to respond | ||
to power outages. | ||
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS: | ||
SECTION 1. Section 39.918, Utilities Code, is amended to | ||
read as follows: | ||
Sec. 39.918. UTILITY FACILITIES FOR RESPONDING TO | ||
SIGNIFICANT [ |
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OUTAGE. (a) In this section, "significant [ |
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outage" means an event that [ |
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(1) results in a loss of electric power that: | ||
(A) affects a significant number of distribution | ||
customers of a transmission and distribution utility[ |
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[ |
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least six [ |
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(B) affects distribution customers of a | ||
transmission and distribution utility in an area for which the | ||
governor has issued a disaster or emergency declaration; | ||
(C) affects distribution customers served by a | ||
radial transmission or distribution facility, creates a risk to | ||
public health or safety, and has lasted or is expected to last for | ||
at least 12 hours; or | ||
(D) creates [ |
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[ |
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affects a critical infrastructure facility that serves the public | ||
such as a hospital, health care facility, law enforcement facility, | ||
fire station, or water or wastewater facility; or | ||
(2) causes the independent system operator to order a | ||
transmission and distribution utility to shed load. | ||
(a-1) The Texas Division of Emergency Management, the | ||
independent organization certified under Section 39.151 for the | ||
ERCOT power region, or the executive director of the commission may | ||
determine that a power outage other than an outage described by | ||
Subsection (a) is a significant power outage for the purposes of | ||
this section. | ||
(a-2) A transmission and distribution utility is entitled | ||
to determine whether a loss of electric power described by | ||
Subsection (a)(1)(C) creates a risk to public health or safety for | ||
the purposes of determining whether the loss event is a significant | ||
power outage. | ||
(b) Notwithstanding any other provision of this subtitle, a | ||
transmission and distribution utility may: | ||
(1) lease and operate facilities that provide | ||
temporary emergency electric energy to aid in restoring power to | ||
the utility's distribution customers during a significant | ||
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(2) procure, own, and operate, or enter into a | ||
cooperative agreement with other transmission and distribution | ||
utilities to procure, own, and operate jointly, transmission and | ||
distribution facilities that have a lead time of at least six months | ||
and would aid in restoring power to the utility's distribution | ||
customers following a significant [ |
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(b-1) In this section, long lead time facilities described | ||
by Subsection (b) may not be electric energy storage equipment or | ||
facilities described by [ |
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(b-2) An affiliate of a transmission and distribution | ||
utility: | ||
(1) may own temporary emergency electric energy | ||
facilities described by Subsection (b)(1); | ||
(2) may lease to the utility temporary emergency | ||
electric energy facilities described by Subsection (b)(1) if the | ||
costs of the lease comply with the requirements of Section 36.058; | ||
(3) is not considered to be a power generation company | ||
for the purposes of this title or the commission's rules based | ||
solely on the ownership of and leasing to the utility temporary | ||
emergency electric energy facilities described by Subsection | ||
(b)(1); | ||
(4) is considered to be a competitive affiliate for | ||
the purposes of this title and the commission's rules if the | ||
affiliate engages in the business of owning and leasing to | ||
unaffiliated third parties temporary emergency electric energy | ||
facilities described by Subsection (b)(1); and | ||
(5) is considered to be a competitive affiliate only | ||
for the purposes of Section 36.058 if: | ||
(A) the affiliate engages solely in the business | ||
of owning and leasing to the utility temporary emergency electric | ||
energy facilities described by Subsection (b)(1); and | ||
(B) the utility demonstrates that the cost of | ||
leasing temporary emergency electric energy facilities described | ||
by Subsection (b)(1) from the affiliate provides benefits to | ||
ratepayers equal to or greater than would have been achieved by | ||
leasing the facilities from an unaffiliated third party. | ||
(c) A transmission and distribution utility that [ |
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not sell electric energy or ancillary services from the facility | ||
[ |
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utility deploys the facility, the utility shall provide written | ||
notice to the commission and a written market notice to advise | ||
competitive market participants of the details of the deployment. | ||
Not later than the fifth business day after the date the deployment | ||
ends, the utility shall file a report, in a form approved by the | ||
commission, providing the details of the deployment, including the | ||
start and end times of the deployment, the number of kilowatts or | ||
megawatts deployed, the number of facilities used, the locations of | ||
the facilities, and any other information required by the | ||
commission. | ||
(d) A facility [ |
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(1) must be operated in isolation from the bulk power | ||
system; and | ||
(2) may not be included in independent system | ||
operator: | ||
(A) locational marginal pricing calculations; | ||
(B) pricing; or | ||
(C) reliability models. | ||
(e) A transmission and distribution utility that [ |
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ensure, to the extent reasonably practicable, that retail customer | ||
usage during operation of the facility [ |
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adjusted out of the usage reported for billing purposes by the | ||
retail customer's retail electric provider. | ||
(f) A transmission and distribution utility that decides to | ||
lease a facility under Subsection (b)(1) shall, when reasonably | ||
practicable, solicit [ |
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received before leasing the facility [ |
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(g) A transmission and distribution utility that leases and | ||
operates facilities under Subsection (b)(1) or that procures, owns, | ||
and operates facilities under Subsection (b)(2) shall include in | ||
the utility's emergency operations plan filed with the commission, | ||
as described by Section 186.007, a detailed plan on the utility's | ||
use of those facilities. | ||
(h) The commission shall allow [ |
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(1) a transmission and distribution utility that | ||
leases and operates facilities under Subsection (b)(1) to recover | ||
the reasonable and necessary costs of leasing and operating the | ||
facilities, including the present value of future payments required | ||
under a [ |
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established in the commission's final order in the utility's most | ||
recent base rate proceeding; and | ||
(2) a transmission and distribution utility that | ||
procures, owns, and operates facilities under Subsection (b)(2) to | ||
recover the reasonable and necessary costs of procuring, owning, | ||
and operating the facilities, using the rate of return on | ||
investment established in the commission's final order in the | ||
utility's most recent base rate proceeding. | ||
(i) The commission shall authorize a transmission and | ||
distribution utility to defer for recovery in a future ratemaking | ||
proceeding the incremental operations and maintenance expenses and | ||
the return, not otherwise recovered in a rate proceeding, | ||
associated with the leasing or procurement, ownership, and | ||
operation of the facilities. | ||
(j) A transmission and distribution utility may request | ||
recovery of the reasonable and necessary costs of leasing or | ||
procuring, owning, and operating facilities under this section, | ||
including any deferred expenses, through a proceeding under Section | ||
36.210 or in another ratemaking proceeding. The commission may | ||
review costs recovered through a proceeding under Section 36.210 in | ||
the following base rate proceeding and order refunds to customers | ||
if appropriate. | ||
(k) A transmission and distribution utility requesting cost | ||
recovery under Subsection (j) is entitled to select whether the | ||
costs are considered to be distribution substation equipment costs | ||
or distribution transformer costs unless the commission has found | ||
in a previous base rate proceeding for the utility that temporary | ||
emergency electric energy costs should be categorized in a | ||
different manner. The costs may not be treated as transmission | ||
costs. A lease under Subsection (b)(1) must be treated as a capital | ||
lease or finance lease for ratemaking purposes. | ||
(l) The fact that the commission has not previously approved | ||
a facility operated under this section or a cost of leasing, | ||
procuring, owning, or operating a facility under this section is | ||
not grounds for dismissal of the facility or the cost from a | ||
proceeding under Section 36.210 or another ratemaking proceeding. | ||
(m) Each transmission and distribution utility that leases | ||
and operates a facility under Subsection (b)(1) shall: | ||
(1) assess every four years the total capacity of | ||
facilities needed to aid in restoring power during a significant | ||
power outage, considering: | ||
(A) the presence and frequency of extreme weather | ||
conditions, including hurricanes, tornadoes, high winds, | ||
lightning, flooding, icing, and freezes, in all or a portion of the | ||
utility's certificated service area; | ||
(B) the utility's current and planned system | ||
hardening efforts; | ||
(C) the utility's current and planned vegetation | ||
management efforts; | ||
(D) the utility's current and planned | ||
expenditures on traditional distribution facilities; | ||
(E) the utility's current and planned | ||
expenditures on automation of its distribution system; | ||
(F) the utility's allocated load shed obligation | ||
based on historical seasonal peak demand, as determined by the | ||
independent system operator; | ||
(G) the presence or number of communities that | ||
are remotely located or served radially in the utility's | ||
certificated service area; | ||
(H) the number or location of critical | ||
infrastructure facilities that serve the public such as hospitals, | ||
health care facilities, law enforcement facilities, fire stations, | ||
and water or wastewater facilities in the utility's certificated | ||
service area; | ||
(I) the utility's emergency operations plan | ||
filed with the commission; and | ||
(J) other engineering or operational needs; and | ||
(2) submit to the commission the assessment under | ||
Subdivision (1) for review. | ||
(n) The commission may: | ||
(1) establish the capacity of facilities that may be | ||
operated by a transmission and distribution utility in aid of | ||
restoration for each type or category of significant power outage; | ||
(2) establish reasonable conditions on the operation | ||
and use of facilities, including duration times and prioritizing | ||
use to serve critical infrastructure facilities that serve the | ||
public such as hospitals, health care facilities, law enforcement | ||
facilities, fire stations, and water or wastewater facilities; and | ||
(3) require compliance with applicable law, including | ||
any rule or order of the commission. | ||
(o) Notwithstanding Subsections (m) and (n), a transmission | ||
and distribution utility may: | ||
(1) provide facilities to or use facilities from other | ||
entities as part of a mutual assistance agreement during a | ||
significant power outage; and | ||
(2) lease facilities on a short-term basis in response | ||
to a significant power outage if: | ||
(A) the significant power outage constitutes an | ||
emergency and the utility determines that additional facilities are | ||
necessary; | ||
(B) the term of the lease is only for the duration | ||
of that emergency; | ||
(C) the utility notifies the commission of the | ||
lease not later than the 30th day after the date of the lease | ||
agreement; and | ||
(D) the commission reviews the costs incurred by | ||
the utility in a proceeding under Section 36.210 or in another | ||
ratemaking proceeding. | ||
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SECTION 2. Section 502.146(b), Transportation Code, is | ||
amended to read as follows: | ||
(b) An owner is not required to register a vehicle that is | ||
used only temporarily on the highways if the vehicle is: | ||
(1) a farm trailer or farm semitrailer with a gross | ||
weight of more than 4,000 pounds but not more than 34,000 pounds | ||
that is used exclusively: | ||
(A) to transport seasonally harvested | ||
agricultural products or livestock from the place of production to | ||
the place of processing, market, or storage; | ||
(B) to transport farm supplies from the place of | ||
loading to the farm; or | ||
(C) for the purpose of participating in equine | ||
activities or attending livestock shows, as defined by Section | ||
87.001, Civil Practice and Remedies Code; | ||
(2) machinery used exclusively for the purpose of | ||
drilling water wells; | ||
(3) oil well servicing or drilling machinery and if at | ||
the time of obtaining the license plates, the applicant submits | ||
proof that the applicant has a permit under Section 623.142; or | ||
(4) construction machinery, including construction | ||
machinery that is: | ||
(A) owned by a transmission and distribution | ||
utility as defined by Section 31.002, Utilities Code; and | ||
(B) used to maintain or repair electrical lines | ||
or substations in response to a power outage. | ||
SECTION 3. (a) The changes in law made in Section 1 of this | ||
Act apply only to a proceeding before the Public Utility Commission | ||
of Texas or other regulatory authority described by Section 11.003, | ||
Utilities Code, that commences on or after the effective date of | ||
this Act. A proceeding before the Public Utility Commission of | ||
Texas or other regulatory authority described by Section 11.003, | ||
Utilities Code, that commenced before the effective date of this | ||
Act is governed by the law in effect on the date the proceeding | ||
commenced, and that law is continued in effect for that purpose. | ||
(b) The changes in law made in Section 1 of this Act apply | ||
only to a contract or lease entered into or facilities procured on | ||
or after the effective date of this Act. | ||
SECTION 4. To the extent of any conflict, this Act prevails | ||
over another Act of the 88th Legislature, Regular Session, 2023, | ||
relating to nonsubstantive additions to and corrections in enacted | ||
codes. | ||
SECTION 5. This Act takes effect September 1, 2023. |