2023S0114-1 02/10/23
	By: Perry	S.B. No. 857

	A BILL TO BE ENTITLED
	AN ACT
	relating to the use of the electric generating facility fund to
	finance construction and maintenance of electric generating and
	transmission facilities in the ERCOT power region; authorizing an
	assessment.
	BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
	SECTION 1.  Subtitle B, Title 2, Utilities Code, is amended
	by adding Chapter 34 to read as follows:
	CHAPTER 34. ELECTRIC GENERATING FACILITY FUND
	Sec. 34.0101.  DEFINITIONS. In this chapter:
	(1)  "Advisory committee" means the Electric
	Generating Facility Fund Advisory Committee.
	(2)  "Fund" means the electric generating facility fund
	established by Section 49-q, Article III, Texas Constitution.
	(3)  "Trust company" means the Texas Treasury
	Safekeeping Trust Company.
	Sec. 34.0102.  FUND. (a) The fund is a special fund in the
	state treasury outside the general revenue fund to be administered
	and used, without further appropriation, by the commission to
	provide loans to finance the construction of electric generating
	facilities and associated transmission facilities in the ERCOT
	power region. The commission may establish separate accounts in
	the fund.
	(b)  The fund and the fund's accounts are kept and held by the
	trust company for and in the name of the commission. The commission
	has legal title to money and investments in the fund until money is
	disbursed from the fund as provided by this chapter and commission
	rules.
	(c)  Money deposited to the credit of the fund may be used
	only as provided by this chapter.
	(d)  The fund consists of:
	(1)  money transferred or deposited to the credit of
	the fund by or as authorized by law, including money from any source
	transferred or deposited to the credit of the fund at the
	commission's discretion;
	(2)  revenue, including the proceeds of any fee,
	assessment, or tax imposed by this state, that general law
	dedicates for deposit to the credit of the fund; and
	(3)  investment earnings and interest earned on money
	in the fund.
	Sec. 34.0103.  LOANS. (a) The commission may use money in
	the fund to:
	(1)  make a loan to finance construction or maintenance
	of:
	(A)  a facility that uses natural gas, clean coal,
	nuclear energy, or another source of heat to generate electricity;
	(B)  a hydroelectric generating facility; or
	(C)  an essential interconnecting transmission
	facility necessary to effect a sale of electric energy at wholesale
	from a facility described by Paragraph (A) or (B); and
	(2)  pay the necessary and reasonable expenses of
	administering the fund.
	(b)  An entity is eligible to receive a loan under this
	chapter only if the entity is authorized by this title to operate
	the type of facility for which the loan is requested.
	(c)  The commission shall:
	(1)  require that an applicant for a loan include with
	the application proof that the applicant has applied for or been
	issued all federal permits required for the operation of the
	proposed electric generating or transmission facility; and
	(2)  give priority to applicants who have been issued
	all federal permits required for the operation of the proposed
	electric generating or transmission facility.
	(d)  The amount of a loan for the construction of an electric
	generating facility may not exceed 25 percent of the estimated
	total cost of constructing the facility.
	(e)  The commission may make a loan for the maintenance of an
	electric generating or transmission facility only if the commission
	has determined that the ERCOT power region has emergency reserve
	electric generation capacity sufficient to prevent blackout
	conditions caused by shortages of generated power in the ERCOT
	power region.
	(f)  The commission:
	(1)  may use for loans not more than 80 percent of the
	fund balance per biennium for facilities that use natural gas,
	clean coal, or another source of heat, other than nuclear energy, to
	generate electricity;
	(2)  shall use for loans at least 10 percent of the fund
	balance per biennium for nuclear or hydroelectric generating
	facilities; and
	(3)  may use for loans not more than 10 percent of the
	fund balance per biennium for transmission facilities described by
	Subsection (a)(1)(C).
	Sec. 34.0104.  MANAGEMENT AND INVESTMENT OF FUND. (a) The
	trust company shall hold and invest the fund, and any accounts
	established in the fund, for and in the name of the commission,
	taking into account the purposes for which money in the fund may be
	used. The fund may be invested with the state treasury pool.
	(b)  The overall objective for the investment of the fund is
	to maintain sufficient liquidity to meet the needs of the fund while
	striving to preserve the purchasing power of the fund.
	(c)  The trust company has any power necessary to accomplish
	the purposes of managing and investing the assets of the fund. In
	managing the assets of the fund, through procedures and subject to
	restrictions the trust company considers appropriate, the trust
	company may acquire, exchange, sell, supervise, manage, or retain
	any kind of investment that a prudent investor, exercising
	reasonable care, skill, and caution, would acquire or retain in
	light of the purposes, terms, distribution requirements, and other
	circumstances of the fund then prevailing, taking into
	consideration the investment of all the assets of the fund rather
	than a single investment.
	(d)  The trust company may charge fees to cover its costs
	incurred in managing and investing the fund. The fees must be
	consistent with the fees the trust company charges other state and
	local governmental entities for which it provides investment
	management services. The trust company may recover fees it charges
	under this subsection only from the earnings of the fund.
	(e)  The trust company annually shall provide a written
	report to the commission and to the advisory committee with respect
	to the investment of the fund. The trust company shall contract
	with a certified public accountant to conduct an independent audit
	of the fund annually and shall present the results of each annual
	audit to the commission and to the advisory committee. This
	subsection does not affect the state auditor's authority to conduct
	an audit of the fund under Chapter 321, Government Code.
	(f)  The trust company shall adopt a written investment
	policy that is appropriate for the fund. The trust company shall
	present the investment policy to the investment advisory board
	established under Section 404.028, Government Code. The investment
	advisory board shall submit to the trust company recommendations
	regarding the policy.
	(g)  The commission annually shall provide to the trust
	company a forecast of the cash flows into and out of the fund. The
	commission shall provide updates to the forecasts as appropriate to
	ensure that the trust company is able to achieve the objective
	specified by Subsection (b).
	(h)  The trust company shall disburse money from the fund as
	directed by the commission.
	(i)  An investment-related contract entered into under this
	section is not subject to Chapter 2260, Government Code.
	Sec. 34.0105.  ELECTRIC GENERATING FACILITY FUND ADVISORY
	COMMITTEE. (a) The advisory committee is composed of the following
	seven members:
	(1)  the comptroller or a person designated by the
	comptroller;
	(2)  three members of the senate appointed by the
	lieutenant governor, including:
	(A)  a member of the committee of the senate
	having primary jurisdiction over matters relating to the generation
	of electricity; and
	(B)  a member of the committee of the senate
	having primary jurisdiction over finance; and
	(3)  three members of the house of representatives
	appointed by the speaker of the house of representatives,
	including:
	(A)  a member of the committee of the house of
	representatives having primary jurisdiction over the generation of
	electricity; and
	(B)  a member of the committee of the house of
	representatives having primary jurisdiction over finance.
	(b)  The commission shall provide staff support for the
	advisory committee.
	(c)  An appointed member of the advisory committee serves at
	the will of the person who appointed the member.
	(d)  The lieutenant governor shall appoint a co-presiding
	officer of the advisory committee from among the members appointed
	by the lieutenant governor. The speaker of the house of
	representatives shall appoint a co-presiding officer of the
	committee from among the members appointed by the speaker.
	(e)  The advisory committee may hold public hearings, formal
	meetings, or work sessions. Either co-presiding officer of the
	advisory committee may call a public hearing, formal meeting, or
	work session of the advisory committee at any time. The advisory
	committee may not take formal action at a public hearing, formal
	meeting, or work session unless a quorum of the committee is
	present.
	(f)  Except as otherwise provided by this subsection, a
	member of the advisory committee is not entitled to receive
	compensation for service on the committee or reimbursement for
	expenses incurred in the performance of official duties as a member
	of the committee. Service on the advisory committee by a member of
	the senate or house of representatives is considered legislative
	service for which the member is entitled to reimbursement and other
	benefits in the same manner and to the same extent as for other
	legislative service.
	(g)  The advisory committee:
	(1)  may provide comments and recommendations to the
	commission for the commission to use in adopting rules regarding
	the use of the fund or on any other matter; and
	(2)  shall review the overall operation, function, and
	structure of the fund at least semiannually.
	(h)  The advisory committee may adopt rules, procedures, and
	policies as needed to administer this section and implement its
	responsibilities.
	(i)  Chapter 2110, Government Code, does not apply to the
	size, composition, or duration of the advisory committee.
	(j)  The advisory committee is subject to Chapter 325,
	Government Code (Texas Sunset Act). Unless continued in existence
	as provided by that chapter, the advisory committee is abolished
	and this section expires September 1, 2033.
	Sec. 34.0106.  RULES. (a) The commission by rule may
	establish procedures for:
	(1)  the application for and award of a loan under this
	chapter; and
	(2)  the administration of the fund.
	(b)  The commission shall give full consideration to
	comments and recommendations of the advisory committee before it
	adopts rules under this chapter.
	Sec. 34.0107.  ELECTRIC GENERATING FACILITY FUND
	ASSESSMENT. (a) An assessment is imposed on the gross receipts of
	each retail electric provider providing retail service in the ERCOT
	power region.
	(b)  The commission shall impose the assessment as a
	percentage of gross receipts from rates charged to an ultimate
	consumer in the ERCOT power region and establish the percentage at a
	rate to ensure that the balance of the fund is sufficient to provide
	funding for the construction of electric generating facilities to
	provide emergency reserve generation capacity sufficient to
	prevent blackout conditions caused by shortages of generated power
	in the ERCOT power region. The commission may establish different
	assessments for gross receipts from rates charged to commercial and
	residential customers.
	(c)  A retail electric provider may collect from its
	customers the assessment imposed under this section as an
	additional item separately stated on the customer bill as "electric
	generating facility fund assessment."
	(d)  The comptroller shall collect the assessment and any
	penalty or interest due under this chapter and deposit the money
	collected in the fund on a schedule determined by the comptroller.
	The comptroller may impose a late payment penalty of not more than
	10 percent of the amount due for a late payment of an assessment
	required under this chapter. The comptroller may collect interest
	on an assessment payment that is delinquent for more than 30 days at
	an annual rate of 12 percent on the amount of the assessment and any
	penalty due.
	SECTION 2.  This Act takes effect on the date on which the
	constitutional amendment proposed by the 88th Legislature, Regular
	Session, 2023, providing for the creation of the electric
	generating facility fund to finance construction and maintenance of
	electric facilities is approved by the voters.  If that amendment is
	not approved by the voters, this Act has no effect.