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Texas lawmakers advance eight energy bills; send two for governor's signature

Highlights

None address weatherization issues

Senate to mull gas 'critical' facilities bill

Securitizing excess costs awaiting votes

Houston — Texas lawmakers advanced during the week ending May 14 eight bills related to the mid-February storm that shut off power for about 4 million customers, with two sent to Gov. Greg Abbot to sign.

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But none of the eight bills addressed key concerns around weatherizing power infrastructure.

One of the bills approved for the governor's signature May 14, House Bill 16, bans the sale of wholesale indexed electricity to residential consumers, which became a big issue when customers of the Griddy retail electricity provider passed on the $9,000/MWh wholesale cost of electricity to customers in the Electric Reliability Council of Texas.

ERCOT barred Griddy from the Texas market in late February.

The other bill pending the governor's signature is House Bill 2586, which would require an independent audit of ERCOT to be posted publicly. The bill has been awaiting Abbott's signature since May 12.

The Texas Legislature May 6 approved House Bill 17, which would prohibit a local government from banning an energy service based on the type of resource. This bill would, for example, keep local governments from banning the installation of natural gas distribution lines in a new residential neighborhood.

As of May 14, two bills were pending on the calendars of the two chambers, which could be the next-closest step toward becoming law. House Bill 3648, which requires the designation of certain gas facilities as critical infrastructure during an energy emergency, is pending on the Senate calendar, while Senate Bill 2154, which increases the Public Utility Commission's membership to five from three, is on the House calendar.

As of May 14, the Texas House of Representatives had on its calendar House Bill 3916, removing restrictions on distributed generation in ERCOT, but this bill also must pass the Senate before the governor can sign it into law.

Three other bills that passed through one chamber remain pending action in the opposite chamber. House Bill 1520, securitizing — i.e. issuing bonds for — excess gas costs from the storm, and House Bill 4492, securitizing excess electricity costs from the storm, have been in Senate committees since May 14. Senate Bill 1606, which creates the Texas Grid Security Commission to identify and harden critical grid infrastructure, is awaiting action in the House State Affairs Committee.

A variety of topics

Most of the remaining bills pending in the Texas Legislature can be placed in seven categories:

  • Six require the establishment of emergency reserve power generation capacity.
  • Four other bills provide some form of securitization of electric or gas costs, which may be moot because of HB 1520 and HB 4492.
  • Four focus on weatherization of electric and gas facilities, but one of the securitization bills also fund weatherization.
  • Two bills focus on identifying critical infrastructure in the electricity supply chain and protecting that infrastructure from power outages.
  • Two bills change the qualifications and process of filling seats on the Electric Reliability Council of Texas Board of Directors.
  • Two bills establish a statewide disaster alert system.
  • Two bills facilitate utilities contracting for battery storage.

Senate Bill 1252 would require an independent audit of ERCOT to be released publicly, which is effectively moot because both chambers already passed House bill 2586.

Another bill that is likely moot is Senate Bill 2142, which would require wholesale power repricing from Feb. 18 through 9 am Feb. 19, when ERCOT was under emergency alert but not in rotating blackouts, which is likely procedurally barred from enactment. During that period, wholesale power prices were at the $9,000/MWh systemwide offer cap.

The deadline for moving that Senate-passed bill through the House process has passed.

Storm and energy bill status in Texas Legislature as of May 14
Bills advanced
For the governor's signature
Change date
HB 16
Bans sale of wholesale indexed power plans to residential customers
14-May
HB 17
No local law to prohibit utility service based on type (e.g., no gas ban on new building)
6-May
HB 2586
Requires independent audit of ERCOT, posted publicly
12-May
Other moves
Change type and date
HB 1520
Securitization of excess gas costs due to storm
In Senate Natural Resources and Economic Development Committee as of May 13
HB 3648
Requires designation of certain gas facilities as critical during an energy emergency
On Senate calendar as of May 14
HB 3916
Removes restrIctions on distributed generation up to 2.5 MW in ERCOT
Approved by House May 14
HB 4492
Securitization of excess electricity costs due to storm
In Senate Business and Commerce Committee as of May 13
SB 1606
Creates Texas Grid Security Commission to identify and harden critical grid infrastructure
In House State Affairs Committee as of May 13
SB 2154
Increase Public Utility Commission membership from three to five
Pending on House Calendar as of May 14
Unchanged status since May 7
Bill Number
Summary
Status
HB10/SB 2
Changes qualifications and process of appointing ERCOT board members
HB in Senate committee, SB in House committee
HB 11
Requires weatherization of electric system
In Senate committee
HB 12/SB 865
Establishes statewide disaster alert system
HB in Senate committee, SB in House committee
HB 13
Creates Texas Energy Disaster Reliability Council
In Senate committee
HB 14
Creates Texas Electricity Supply Chain Security and Mapping Committee
In Senate committee
HB 1672/SB 415
Facilitates transmission and distribution utilities to own battery storage capacity
Both pending on House Calendar
SB 1252
Requires independent audit of ERCOT, posted publicly
HB on Senate Calendar, SB in Senate committee (moot, see HB 1520)
HB 3749
Requires Public Utility Commission to conduct weatherization inspections
In House committee
HB 3792
Creates Texas Grid Security Commission to identify and harden critical grid infrastructure
HB in House committee, SB on Senate calendar
SB 1580/SB 1757
Securitization of excess electricity costs due to storm
HB approved by House, SB 1580 in House committee, SB 1757 pending on Senate Calendar
HBs 2506, 2657, 3178, 4167; SBs 1352, 2076
Requires emergency reserve power generation capacity
HBs in House committee, SBs in Senate committees
SB 1579
Securitization of gas customer rate relief
In Senate committee
SB 1782
Securitization of electric utilities' system restoration and weatherization costs
In Senate committee
SB 2142
Repricing Feb. 18-19
In House committee
SB 3
Omnibus (emergency pricing, weatherization requirements, gas supply chain mapping)
In House committee
SB 985
Requires weatherization reports to cover events with a 1% probability
In House committee
Bill stages Introduction in one chamber, approved by a committee, approved by first chamber, approved by second chamber committee, approved by second chamber, enacted by governor's signature or a lack of veto.
Source: Texas Legislature