HB3970 - Relating to the interconnection and operation of large loads.

      By: Darby H.B. No. 3970       A BILL TO BE ENTITLED   AN ACT   relating to the interconnection and operation of large loads.          BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:          SECTION 1.  Subchapter D, Chapter 39, Utilities Code, is   amended by adding Section 39.169 to read as follows:           Sec.   39.169.     LARGE LOAD INTERCONNECTION. (a) In this   section:                 (1)     "Behind-the-meter generation" means a generation   facility on the retail customer's side of the meter capable of   serving the full load requirement of the retail customer.                 (2)     "Flexible load" means a large load operated by a   retail customer who is obligated by contract or agreement in the   ERCOT market to reduce the load or power the load exclusively with   back-up generation:                       (A)     at the direction of the independent   organization certified under Section 39.151 for the ERCOT power   region; or                       (B)     as required to protect the integrity of the   ERCOT grid.           (b)     The commission by rule shall establish a program to   provide an expedited process for the interconnection of large   loads.   The program must require the interconnecting electric   cooperative, municipally owned utility, or transmission and   distribution utility and the independent organization certified   under Section 39.151 for the ERCOT power region to give priority in   the interconnection queue to a large load for which a retail   customer has received approval for expedited processing over any   other large loads that have not entered into a contractual   agreement with the electric utility, electric cooperative, or   municipally owned utility regarding the provision of electric   service.   If applicable, the generation interconnection   application for a generation facility associated with the large   load must be processed in parallel with the large load.           (c)     The program must require a large load to qualify for   expedited interconnection processing by bringing in-service, not   later than the 180th day after the interconnection date,   behind-the-meter generation that is:                 (1)     registered with the independent organization   certified under Section 39.151 for the ERCOT power region; and                 (2)     capable of serving the full load requirement of   the customer.           (d)     As an alternative to the requirements of Subsection (c),   a large load may qualify for expedited interconnection processing,   if the load is a facility with an aggregated peak demand at a single   site of more than 75 megawatts, by:                 (1)     providing to the interconnecting electric   cooperative, municipally owned utility, or transmission and   distribution utility all data regarding, and posting all required   financial security for, the load; and                 (2)     being subject to a binding commitment with the   independent organization certified under Section 39.151 for the   ERCOT power region to establish the load as a flexible load for a   minimum period established by the commission, which must be at   least 10 years.           (e)     A large load that qualifies for expedited   interconnection processing may choose:                 (1)     if authorized by the independent organization   certified under Section 39.151 for the ERCOT power region and the   relevant electric cooperative, municipally owned utility, or   transmission and distribution utility, to contract with a vendor   approved by the relevant electric cooperative, municipally owned   utility, or transmission and distribution utility or by the   independent organization to perform all studies required by the   relevant electric cooperative, municipally owned utility, or   transmission and distribution utility before the approval of the   interconnection application; and                 (2)     if authorized by the relevant electric   cooperative, municipally owned utility, or transmission and   distribution utility:                       (A)     to procure equipment required for the   interconnection in accordance with technical specifications   provided by the relevant electric cooperative, municipally owned   utility, or transmission and distribution utility; and                       (B)     to construct interconnection facilities in   accordance with technical and other requirements of the relevant   electric cooperative, municipally owned utility, or transmission   and distribution utility.           (f)     The program may provide that studies required by an   electric cooperative, municipally owned utility, or transmission   and distribution utility before the approval of an interconnection   application for a flexible load may evaluate the load as non-firm.           (g)     Demand reductions from flexible loads that receive   expedited processing and are removed from the system through the   utilization of behind-the-meter generation during an energy   emergency alert must be counted toward any obligation of the   electric cooperative, municipally owned utility, or transmission   and distribution utility to shed load.           (h)     The independent organization certified under Section   39.151 for the ERCOT power region shall consider action taken under   this section as a reliability deployment when calculating any price   adjustments for reliability deployments.           (i)     The commission shall establish financial penalties the   commission may impose on an owner or operator of a large load that   is approved for expedited interconnection processing but fails to   reduce the load or power the load with back-up generation as   directed by the independent organization certified under Section   39.151 for the ERCOT power region.          SECTION 2.  This Act takes effect September 1, 2025.