HB4302 - Relating to the recovery of vegetation management costs by electric utilities.

  89R7760 JXC-D     By: Metcalf H.B. No. 4302       A BILL TO BE ENTITLED   AN ACT   relating to the recovery of vegetation management costs by electric   utilities.          BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:          SECTION 1.  Subchapter E, Chapter 36, Utilities Code, is   amended by adding Section 36.2031 to read as follows:           Sec.   36.2031.     VEGETATION MANAGEMENT COST RECOVERY;   ADJUSTMENT OF VEGETATION MANAGEMENT FACTOR.   (a) Section 36.201   does not prohibit the commission from reviewing and providing for   adjustments of an electric utility's vegetation management factor.           (b)     The commission by rule shall implement procedures that   provide for the timely adjustment of an electric utility's   vegetation management factor. The rules must require that the   findings required by Section 36.058 regarding vegetation   management transactions with affiliated interests be made in a   vegetation management reconciliation proceeding or in a rate case   filed under Subchapter C or D. The rules must ensure that:                 (1)     the utility collects as contemporaneously as   reasonably possible the vegetation management costs that the   utility incurs and that the commission determines are eligible;                 (2)     the total of the utility's eligible vegetation   management costs, including any under-collected or over-collected   amounts to be recovered through an interim adjustment, is allocated   among customer classes based on actual historical calendar month   usage;                 (3)     any material balance of amounts under-collected or   over-collected for eligible vegetation management costs is   collected from or refunded to customers through an interim   adjustment:                       (A)     not later than the 90th day after the date the   balance is accrued; or                       (B)     if the adjustment would result in a total   bill increase of 10 percent or more compared to the total bill in   the month before implementation, not later than a date ordered by   the commission which must be after the 90th day after the date the   balance is accrued; and                 (4)     an affected party will receive notice and have the   opportunity to request a hearing before the commission.           (c)     Notwithstanding Subsection (b)(3), on a finding that an   electric utility has an under-collected balance that is the result   of extraordinary vegetation management costs that are unlikely to   continue, the commission may approve an interim vegetation   management adjustment that would defer recovery to take place over   a period longer than 90 days.           (d)     The commission is not required to hold a hearing on the   adjustment of an electric utility's vegetation management factor   under this section.   If the commission holds a hearing, the   commission may consider at the hearing any evidence that is   appropriate and in the public interest.           (e)     A customer of the electric utility, a municipality with   original jurisdiction over the utility, or the office may protest a   vegetation management factor or interim adjustment proposed under   this section. The prudence of costs may not be considered in a   vegetation management factor or interim adjustment proceeding and   may only be considered in a vegetation management reconciliation   proceeding under Subsection (h) or another appropriate proceeding.           (f)     The sole issue that may be considered on a protest of a   vegetation management factor under Subsection (e) is whether the   factor reasonably reflects costs the electric utility will incur so   that the utility will not substantially under-collect or   over-collect the utility's reasonably stated vegetation management   costs on an ongoing basis. The commission may adjust the utility's   vegetation management factor based on its determination on that   issue.           (g)     The commission shall hold a hearing on a protest of an   interim adjustment under Subsection (e) if the adjustment would   result in a total bill increase of 10 percent or more as described   by Subsection (b)(3) or if the adjustment results from   extraordinary vegetation management costs as described by   Subsection (c). In response to a protest of an interim adjustment,   if the commission finds that the electric utility is in a state of   material under-collection or over-collection of the utility's   reasonably stated eligible vegetation management costs and is   projected to remain in that state on an ongoing basis, the   commission shall order the utility to establish or modify an   interim adjustment to address the under-collection or   over-collection in a manner consistent with this section.           (h)     An electric utility shall apply to reconcile the   vegetation management costs at least once every two years. The   application must be made not later than the 180th day after the last   day of the period to be reconciled. The commission may by rule   establish the calendar year timing of the reconciliation period for   each electric utility subject to this section to facilitate   efficient work by the commission. To the extent a reconciliation   results in a change to the electric utility's under-collected or   over-collected vegetation management balance, that change may be   incorporated into an interim adjustment as directed by the   commission.           (i)     A proceeding under this section is not a rate case under   Subchapter C.          SECTION 2.  This Act takes effect September 1, 2025.