Bill Text: TX SB2012 | 2023-2024 | 88th Legislature | Introduced

NOTE: There are more recent revisions of this legislation. Read Latest Draft

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Bill Title: Relating to the implementation of a program to meet the reliability needs of the ERCOT power region.

Spectrum: Partisan Bill (Republican 3-0)

Status: (Engrossed - Dead) 2023-05-23 - Postponed 6/1/23 10:00 AM [SB2012 Detail]

Download: Texas-2023-SB2012-Introduced.html

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88R16679 JXC-D
By: Schwertner, King S.B. No. 2012

A BILL TO BE ENTITLED
AN ACT
relating to electricity services; increasing an administrative
penalty.
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
SECTION 1. Sections 15.023(b-1) and (f), Utilities Code,
are amended to read as follows:
(b-1) Notwithstanding Subsection (b), the penalty for a
violation of Subtitle B [a provision of Section 35.0021 or 38.075]
may be in an amount not to exceed $1,000,000 for a violation. Each
day a violation continues or occurs is a separate violation for
purposes of imposing a penalty.
(f) The commission and a person may develop and enter into a
voluntary mitigation plan relating to a violation of Section 39.157
or rules adopted by the commission under that section. The
voluntary mitigation plan must be updated at least once every two
years. Adherence [If the commission and a person enter into a
voluntary mitigation plan, adherence] to the plan may be considered
in determining whether a violation occurred and, if so, the penalty
to be assessed [constitutes an absolute defense against an alleged
violation with respect to activities covered by the plan].
SECTION 2. Section 39.159(b), Utilities Code, as added by
Chapter 426 (S.B. 3), Acts of the 87th Legislature, Regular
Session, 2021, is amended to read as follows:
(b) The commission shall ensure that the independent
organization certified under Section 39.151 for the ERCOT power
region:
(1) establishes requirements to meet the reliability
needs of the power region;
(2) seasonally [periodically, but at least annually,]
determines the quantity and characteristics of ancillary or
reliability services necessary to ensure appropriate reliability
during extreme heat and extreme cold weather conditions and during
times of low non-dispatchable power production in the power region;
(3) seasonally procures ancillary or reliability
services on a competitive basis to ensure appropriate reliability
during extreme heat and extreme cold weather conditions and during
times of low non-dispatchable power production in the power region;
(4) develops appropriate qualification and
performance requirements for providing services under Subdivision
(3), including appropriate penalties for failure to provide the
services; and
(5) sizes the services procured under Subdivision (3)
to prevent prolonged rotating outages due to net load variability
in high demand and low supply scenarios.
SECTION 3. Subchapter D, Chapter 39, Utilities Code, is
amended by adding Sections 39.1595 and 39.1596 to read as follows:
Sec. 39.1595. RELIABILITY PROGRAM. The commission may not
adopt a reliability program for the ERCOT power region that
requires the purchase of credits earned by generators based on
generator availability during times of high demand and low supply
at a centrally determined clearing price unless the commission
ensures that:
(1) the net cost to the ERCOT market of the program
does not exceed $500 million;
(2) credits are available only for dispatchable
generation;
(3) the cost of credits is assigned to generation
facilities on a cost-causation basis rather than to load serving
entities;
(4) the program includes appropriate penalties for a
failure to provide a required program service;
(5) the independent organization certified under
Section 39.151 for the ERCOT power region implements real time
co-optimization of energy and ancillary services in the ERCOT
wholesale market before the credit program is implemented; and
(6) the entire program is initiated on a single
starting date.
Sec. 39.1596. GRID RELIABILITY LEGISLATIVE OVERSIGHT
COMMITTEE. (a) In this section, "committee" means the Grid
Reliability Legislative Oversight Committee established under this
section.
(b) The Grid Reliability Legislative Oversight Committee is
created to oversee the commission's implementation of Section
35.004, Section 39.159, as added by Chapter 426 (S.B. 3), Acts of
the 87th Legislature, Regular Session, 2021, and Section 39.1595.
(c) The committee is composed of eight members as follows:
(1) three members of the senate, appointed by the
lieutenant governor;
(2) three members of the house of representatives,
appointed by the speaker of the house of representatives;
(3) the chair of the committee of the senate having
primary jurisdiction over matters relating to the generation of
electricity; and
(4) the chair of the committee of the house having
primary jurisdiction over matters relating to the generation of
electricity.
(d) An appointed member of the committee serves at the
pleasure of the appointing official.
(e) The committee members described by Subsections (c)(3)
and (4) serve as presiding co-chairs.
(f) A member of the committee may not receive compensation
for serving on the committee but is entitled to reimbursement for
travel expenses incurred by the member while conducting the
business of the committee as provided by the General Appropriations
Act.
(g) The committee shall meet at least twice each year at the
call of either co-chair and shall meet at other times at the call of
either co-chair, as that officer determines appropriate.
(h) Chapter 551, Government Code, applies to the committee.
(i) The committee shall submit a report to the governor,
lieutenant governor, speaker of the house of representatives, and
legislature not later than December 1 of each even-numbered year.
The report must include an update on the progress of and issues
related to the commission's implementation of the laws under the
committee's oversight as provided by Subsection (b).
SECTION 4. Subchapter D, Chapter 39, Utilities Code, is
amended by adding Section 39.166 to read as follows:
Sec. 39.166. LIMITATION OF MARKET SHARE SERVED BY RETAIL
ELECTRIC PROVIDER. (a) A retail electric provider and a corporate
parent of the retail electric provider may not, considered
together, provide retail market service to more than 20 percent of
the customers in the competitive retail market in a power region.
(b) Each retail electric provider that offers electricity
for sale shall report to the commission its annual retail sales in
this state, the annual retail sales in this state by the provider's
corporate parent, and any other information the commission requires
to assess compliance with Subsection (a). The commission by rule
shall prescribe the nature and detail of the reporting
requirements. The commission shall administer the reporting
requirements in a manner that ensures the confidentiality of
competitively sensitive information.
(c) The commission shall require a retail electric provider
that the commission finds is violating Subsection (a) to submit to
the commission a plan for reducing the provider's market share. The
plan must be in a form prescribed by the commission and provide
information the commission finds reasonably necessary to evaluate
the plan.
(d) The commission shall approve, modify, or reject a plan
submitted under Subsection (c) not later than the 180th day after
the date the plan is filed with the commission. In evaluating a
plan for approval, modification, or rejection, the commission shall
consider:
(1) the effect of the plan on current and potential
competitors in the generation market; and
(2) whether the plan is consistent with the public
interest.
(e) A retail electric provider with an approved plan may
request that the commission amend or repeal the plan. The
commission shall amend or repeal the plan on a showing of good
cause.
SECTION 5. Chapter 39, Utilities Code, is amended by adding
Subchapter O to read as follows:
SUBCHAPTER O. CONSTRUCTION OF DISPATCHABLE GENERATION FACILITIES
FOR RELIABILITY
Sec. 39.701. EVALUATION. Not later than January 31, 2027,
the commission shall determine whether at least 5,000 megawatts of
dispatchable generation capacity was installed in the ERCOT power
region between June 1, 2023, and December 31, 2026.
Sec. 39.702. CONSTRUCTION OF DISPATCHABLE GENERATION
FACILITIES FOR RELIABILITY. (a) Notwithstanding any other law, if
the commission determines under Section 39.701 that less than 5,000
megawatts of dispatchable generation capacity was installed in the
ERCOT power region between June 1, 2023, and December 31, 2026, the
commission shall require transmission and distribution utilities
to install an amount of dispatchable generation capacity sufficient
to ensure that an additional 5,000 megawatts of dispatchable
generation capacity is available in the ERCOT power region compared
to the amount of installed dispatchable generation capacity on June
1, 2023.
(b) Costs incurred by a transmission and distribution
utility under this section are recoverable in the utility's rates.
(c) A transmission and distribution utility that installs
dispatchable generation capacity under this section shall register
as a power generation company. The commission shall waive the
requirements of Section 39.154 for a facility installed under this
section.
SECTION 6. The changes in law made by this Act to Chapter
15, Utilities Code, apply only to a violation committed on or after
the effective date of this Act. A violation committed before the
effective date of this Act is governed by the law in effect when the
violation was committed, and the former law is continued in effect
for that purpose.
SECTION 7. This Act takes effect September 1, 2023.