Bill Text: TX SB735 | 2017-2018 | 85th Legislature | Introduced
NOTE: There are more recent revisions of this legislation. Read Latest Draft
Bill Title: Relating to periodic rate adjustment by and to certain transactions involving electric utilities.
Spectrum: Slight Partisan Bill (Republican 2-1)
Status: (Passed) 2017-05-27 - Effective immediately [SB735 Detail]
Download: Texas-2017-SB735-Introduced.html
Bill Title: Relating to periodic rate adjustment by and to certain transactions involving electric utilities.
Spectrum: Slight Partisan Bill (Republican 2-1)
Status: (Passed) 2017-05-27 - Effective immediately [SB735 Detail]
Download: Texas-2017-SB735-Introduced.html
85R5603 GRM-F | ||
By: Hancock | S.B. No. 735 |
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relating to periodic rate adjustment by electric utilities. | ||
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS: | ||
SECTION 1. Section 35.004, Utilities Code, is amended by | ||
amending Subsection (d) and adding Subsection (d-1) to read as | ||
follows: | ||
(d) The commission shall price wholesale transmission | ||
services within ERCOT based on the postage stamp method of pricing | ||
under which a transmission-owning utility's rate is based on the | ||
ERCOT utilities' combined annual costs of transmission divided by | ||
the total demand placed on the combined transmission systems of all | ||
such transmission-owning utilities within a power region. An | ||
electric utility subject to the freeze period imposed by Section | ||
39.052 may treat transmission costs in excess of transmission | ||
revenues during the freeze period as an expense for purposes of | ||
determining annual costs in the annual report filed under Section | ||
39.257. Notwithstanding Section 36.201, the commission may approve | ||
wholesale rates that may be periodically adjusted to ensure timely | ||
recovery of transmission investment and shall establish a schedule | ||
that requires an electric utility to make periodic filings with the | ||
commission to modify or review a rate charge by the electric | ||
utility. The schedule may be established on the basis of the period | ||
since the electric commission last reviewed the electric utility's | ||
rate, whether the electric utility has earned materially more than | ||
the utility's authorized rate of return as demonstrated by earnings | ||
monitoring reports, or other criteria that the commission | ||
determines is in the public interest. Notwithstanding Section | ||
36.054(a), if the commission determines that conditions warrant the | ||
action, the commission may authorize the inclusion of construction | ||
work in progress in the rate base for transmission investment | ||
required by the commission under Section 39.203(e). | ||
(d-1) The commission shall adopt rules establishing rate | ||
adjustments, on a periodic basis determined by the commission, to | ||
reflect changed transmission cost for: | ||
(1) depreciation; | ||
(2) plant retirement; and | ||
(3) other factors that reduce rates. | ||
SECTION 2. The heading to Section 36.060, Utilities Code, | ||
is amended to read as follows: | ||
Sec. 36.060. UTILITY [ |
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SECTION 3. Section 36.060, Utilities Code, is amended by | ||
adding Subsection (d) to read as follows: | ||
(d) Notwithstanding any other provision of this chapter, if | ||
the income of an electric utility is not subject to corporate | ||
federal income tax because of the corporate organization of the | ||
utility and the utility's upstream owners, the commission may not | ||
include federal tax on the income as an expense in setting the | ||
utility's rates. | ||
SECTION 4. Subchapter D, Chapter 36, Utilities Code, is | ||
amended by adding Section 36.157 to read as follows: | ||
Sec. 36.157. RATE REVIEW SCHEDULE. Notwithstanding any | ||
other provision of this title, the commission shall establish a | ||
schedule that requires an electric utility to make periodic filings | ||
with the commission to modify or review a rate charged by the | ||
electric utility. The schedule may be established on the basis of: | ||
(1) the period since the electric commission last | ||
reviewed the electric utility's rate; | ||
(2) whether the electric utility has earned materially | ||
more than the utility's authorized rate of return as demonstrated | ||
by earnings monitoring reports; or | ||
(3) other criteria that the commission determines is | ||
in the public interest. | ||
SECTION 5. Section 39.262(m), Utilities Code, is amended to | ||
read as follows: | ||
(m) The commission shall approve a transaction under | ||
Subsection (l) if the commission finds that the transaction is in | ||
the public interest. In making its determination, the commission | ||
shall consider whether the transaction will adversely affect the | ||
reliability of service, availability of service, or cost of service | ||
of the electric utility or transmission and distribution | ||
utility. The commission shall make the determination concerning a | ||
transaction under this subsection not later than the 180th day | ||
after the date the commission receives the relevant report. The | ||
commission may extend the deadline provided by this subsection for | ||
not more than 60 days if the commission determines the extension is | ||
needed to evaluate additional information, to consider actions | ||
taken by other jurisdictions concerning the transaction, to provide | ||
for administrative efficiency, or for other good cause. If the | ||
commission has not made a determination before the expiration of | ||
the deadline provided by or extended under this subsection [ |
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SECTION 6. Section 39.915(b), Utilities Code, is amended to | ||
read as follows: | ||
(b) The commission shall approve a transaction under | ||
Subsection (a) if the commission finds that the transaction is in | ||
the public interest. In making its determination, the commission | ||
shall consider whether the transaction will adversely affect the | ||
reliability of service, availability of service, or cost of service | ||
of the electric utility or transmission and distribution | ||
utility. The commission shall make the determination concerning a | ||
transaction under this subsection not later than the 180th day | ||
after the date the commission receives the relevant report. The | ||
commission may extend the deadline provided by this subsection for | ||
not more than 60 days if the commission determines the extension is | ||
needed to evaluate additional information, to consider actions | ||
taken by other jurisdictions concerning the transaction, to provide | ||
for administrative efficiency, or for other good cause. If the | ||
commission has not made a determination before the expiration of | ||
the deadline provided by or extended under this subsection [ |
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SECTION 7. Sections 36.210(h), (h-1), and (i), Utilities | ||
Code, are repealed. | ||
SECTION 8. 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, 2017. |