Resignations/Nominations
PUC Commissioners Dee Anne Walker, Shelly Botkin, and Arthur D’Andrea resigned after the response from Winter Storm Uri. During this time, ERCOT CEO and President Bill Magness was voted out by the board.
- Peter Lake was confirmed by the Senate on (4/20) as the new PUC Chair. His term is effective until September 1, 2023.
- Will McAdams was confirmed by the Senate on (4/12) as PUC Commissioner. His term is effective until September 1, 2025.
- Brad Jones was elected as the ERCOT Interim CEO/President on (4/27). His term is effective 5/4, until the position is filled.
Bills
HB 16 (Hernandez/Hancock) prohibits retail electric providers from offering wholesale indexed products to residential and small commercial customers. Customers who are not residential or small-commercial must sign an acknowledgement to a contract, which may be added as an addendum, that they accept the potential price risks with such plans.
The bill requires retail electric providers, who provide a residential customer who has a fixed rate product, to provide at least three written notices of the date the fixed product will expire and details the specific modes the customer needs to be notified by. If a customer does not select another retail provider before their contract expires, the provider shall automatically serve the customer through a default renewal product that the customer may cancel at any time without a fee. HB 16 was signed by the Governor on 5/25 and is effective on 9/1/2021.
HB 1510 (Metcalf/Creighton) establishes the Texas Electric Utility System Restoration Corporation for the securitization and issuance of transition bonds and system restoration bonds for electric utilities outside of ERCOT to obtain recovery of system restoration costs. The bill was sent to the Governor on 5/22.
HB 1520 (Paddie/Hancock), the gas utility securitization funding bill, was sent to the Governor on 6/1.
HB 4492 (Paddie/Hancock) directs the Comptroller to invest not more than $800 million of the Economic Stabilization Fund in debt obligations issued by ERCOT. The bill enables ERCOT to issue debt obligations to finance substantial balances owed by wholesale market participants and that would otherwise be uplifted as a result of Winter Storm Uri. Additionally, the bill authorizes PUC, on application of ERCOT, to adopt an order authorizing the issuance of debt obligations. The bill would be exempt from state and local sales and use, franchise, and gross receipts taxes the transfer and receipt of default charges relating to the debt obligations. The bill was sent to the Governor on 6/1.
SB 2 (Hancock/Paddie) changes the makeup of the ERCOT board of directors to an eleven-member board with eight fully independent members who will be elected by an independent search firm. The three remaining seats will be for the chair of the PUC, OPUC, and the ERCOT CEO. Any major market change will need PUC’s approval. The bill was sent to the Governor on 6/1.
SB 3 (Schwertner/Paddie) establishes an emergency alert system to be managed by DPS. The bill formalizes the Texas Reliability Council and the Texas Electricity Supply Chain Security and Mapping committee. Weatherization of critical power generation, natural gas and transmission facilities will be required and enforced through penalties and inspections by the PUC and RRC. TCEQ will be required to review and approve all emergency preparedness plans and to provide in assisting in creating the plan.
SB 3 directs PUC and ERCOT to use an ancillary services fee to pay for more dispatchable generation and establishes an emergency pricing mechanism to take effect at the high system wide offer cap when it was in effect for 12 hours within a 24-hour period. Also included are provisions related to more robust oversight and planning of load shed procedures during outages. The PUC is required to redefine “critical care residential customer” and “critical load industrial customer.”
The bill creates the Critical Infrastructure Resiliency Fund (CIRF) which would be a special fund in the Treasury outside General Revenue and would be administered by TDEM for the purpose of providing grants. The Water Code was amended to authorize the Water Assistance Program, administered by the TWDB, to provide grants for projects to harden and weatherize water and wastewater systems. TWDB would be required to consult with TDEM in issuing grants. The bill was sent to the Governor on 6/1.
SB 415 (Hancock/Holland) relating to battery storage facilities in the ERCOT power region, amends the Utilities Code to revise the applicability of provisions of the Public Utility Regulatory Act governing electric energy storage by:
- Making provisions appliable to only to ownership or operation of electric energy storage equipment or facility in the ERCOT power region that are intended for certain purposes and
- Including providing reliable delivery of electric energy to distribution customers among those purposes
The bill authorizes a transmission and distribution utility that has that has received prior approval by the PUC to contract with a power generation company to provide electric energy from an electric energy storage facility. Additionally, modifications are made for contacting requirements for battery storage facilities.
The bill prohibits the PUC from authorizing ownership of a storage facility by a utility and prohibits the power generation company from discharging the facility to satisfy the contract’s requirements unless directed by the utility. SB 415 caps the total amount of electric energy storage capacity reserved by such contracts at 100 megawatts. Additionally, the PUC will adopt rules to establish the maximum amount of electric energy storage capacity allotted to each utility and to implement all of the bill’s provisions. The bill was sent to the Governor and has an effective date of 9/1/2021.
SB 1580 (Hancock/Paddie), the electric cooperative securitization funding bill, was sent to the Governor on 6/1.
SB 2154 (Schwertner/Paddie) increases the number of commissioners at the Public Utility Commission from three to five and amends the rules for commissioner eligibility. Additionally, the bill prohibits former commissioners from lobbying for one year. The bill was sent to the Governor on 6/1.
