SB6 - Relating to the planning for, interconnection and operation of, and costs related to providing service for certain electrical loads and to the generation of electric power by a water supply or sewer service corporation.

      S.B. No. 6         AN ACT   relating to the planning for, interconnection and operation of, and   costs related to providing service for certain electrical loads and   to the generation of electric power by a water supply or sewer   service corporation.          BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:          SECTION 1.  Section 35.004, Utilities Code, is amended by   adding Subsections (c-1) and (c-2) to read as follows:           (c-1)     The commission by rule shall ensure that a large load   customer who is subject to the standards adopted under Section   37.0561 contributes to the recovery of the interconnecting electric   utility's costs to interconnect the large load to the utility's   system.           (c-2)     An electric cooperative or municipally owned utility   that has not adopted customer choice shall pass through to a large   load customer who is subject to the standards adopted under Section   37.0561 the reasonable costs to interconnect the large load in a   manner determined by the electric cooperative or municipally owned   utility.          SECTION 2.  Subchapter B, Chapter 37, Utilities Code, is   amended by adding Section 37.0561 to read as follows:           Sec.   37.0561.     PLANNING FOR AND INTERCONNECTION OF LARGE   LOADS. (a) For the purposes of this section, a large load customer   includes an entity requesting an interconnection that exceeds the   demand threshold adopted under Subsection (c) and a successor in   interest to such an entity.           (b)     The commission by rule shall establish standards for   interconnecting large load customers in the ERCOT power region in a   manner designed to support business development in this state while   minimizing the potential for stranded infrastructure costs and   maintaining system reliability.           (c)     The standards must apply only to customers requesting a   new or expanded interconnection where the total load at a single   site would exceed a demand threshold established by the commission   based on the size of loads that significantly impact transmission   needs in the ERCOT power region.   The commission shall establish a   demand threshold of 75 megawatts unless the commission determines   that a lower threshold is necessary to accomplish the purposes   described by Subsection (b).           (d)     The standards must require each large load customer   subject to Subsection (c) to disclose to the interconnecting   electric utility or municipally owned utility whether the customer   is pursuing a substantially similar request for electric service in   this state the approval of which would result in the customer   materially changing, delaying, or withdrawing the interconnection   request.   The disclosure may withhold or anonymize competitively   sensitive details.   The commission by rule shall prohibit an   electric utility or municipally owned utility from selling,   sharing, or disclosing information submitted to the utility under   this subsection other than a disclosure to the commission or the   independent organization certified under Section 39.151 for the   ERCOT power region, subject to appropriate confidentiality   protections.           (e)     The standards must require each interconnected large   load customer subject to Subsection (c) to disclose to the   interconnecting electric utility or municipally owned utility   information about the customer's on-site backup generating   facilities and require the interconnecting electric utility or   municipally owned utility to provide the information to the   independent organization certified under Section 39.151 for the   ERCOT power region.   For the purposes of this subsection, "on-site   backup generating facilities" means generation that is not capable   of exporting energy to the ERCOT transmission grid and that, in the   aggregate, can serve at least 50 percent of on-site demand. The   independent organization shall establish a threshold before or   during an energy emergency alert at which the organization may   issue reasonable notice that large load customers with on-site   backup generating facilities may be directed to either deploy the   customer's on-site backup generating facilities or curtail load.     After the independent organization deploys all available market   services, except for frequency responsive services, the   independent organization may direct the applicable electric   utility or municipally owned utility to require the large load   customer to either deploy the customer's on-site backup generating   facilities or curtail load.   The independent organization shall   include a deployment under this section as firm load shed when   calculating any price adjustments for reliability deployments.   This subsection does not:                 (1)     authorize or require a violation of any emissions   limitation in state or federal law or a violation of any other   environmental regulation; or                 (2)     prohibit a large load customer from participating   in a service authorized by Section 39.170(b).           (f)     The standards must set a flat study fee of at least   $100,000 to be paid to the interconnecting electric utility or   municipally owned utility for initial transmission screening   studies for large loads subject to Subsection (c). A large load   customer that requests additional capacity following the screening   study must pay an additional study fee based on the new request.     The interconnecting electric utility or municipally owned utility   shall apply any unused portion of the initial transmission   screening study fee as a credit toward satisfying financial   obligations for procurement or interconnection agreements at the   same geographic site.           (g)     The standards must include a method for a large load   customer subject to Subsection (c) to demonstrate site control for   the proposed load location through an ownership interest, lease, or   another legal interest acceptable to the commission.           (h)     The standards must include uniform financial commitment   requirements for the development of transmission infrastructure   needed to serve a large load customer subject to Subsection (c).     The standards must provide that satisfactory proof of financial   commitment may include:                 (1)     security provided on a dollar per megawatt basis   as set by the commission;                 (2)  contribution in aid of construction;                 (3)     security provided under an agreement that requires   a large load customer to pay for significant equipment or services   in advance of signing an agreement to establish electric delivery   service; or                 (4)     a form of financial commitment acceptable to the   commission other than those provided by Subdivisions (1)-(3).           (i)     Security provided under Subsection (h)(1) must be   refunded, in whole or in part, after the security is applied to any   outstanding amounts owed:                 (1)     as the large load customer meets the customer's   load ramp milestones and sustains operations for a prescribed   period as determined by the commission;                 (2)     if the large load customer withdraws the   customer's request for all or a portion of the requested capacity;   or                 (3)     if capacity subject to a financial commitment will   be reallocated to one or more other customers.           (j)     The commission shall establish uniform requirements for   determining when capacity that is subject to an outstanding   financial commitment under this section may be reallocated.           (k)     The standards must establish a procedure to allow the   independent organization certified under Section 39.151 for the   ERCOT power region to access any information collected by the   interconnecting electric utility or municipally owned utility to   ensure compliance with the standards for transmission planning   analysis. Any customer-specific or competitively sensitive   information obtained under this subsection is confidential and not   subject to disclosure under Chapter 552, Government Code.           (l)     The commission may not limit the authority of a   municipally owned utility or an electric cooperative to impose   electric service requirements for large load customers on their   systems in addition to the standards adopted under this section.           (m)     Notwithstanding the forecasted load growth and   additional load currently seeking interconnection required to be   considered under Section 37.056(c-1), the commission by rule shall   establish criteria by which the independent organization certified   under Section 39.151 for the ERCOT power region includes forecasted   large load of any peak demand in the organization's transmission   planning and resource adequacy models and reports.          SECTION 3.  Section 39.002, Utilities Code, is amended to   read as follows:          Sec. 39.002.  APPLICABILITY. This chapter, other than   Sections 39.151, 39.1516, 39.155, 39.157(e), 39.161, 39.162,   39.163, 39.169, 39.170, 39.203, 39.9051, 39.9052, and 39.914(e),   and Subchapters M and N, does not apply to a municipally owned   utility or an electric cooperative.  Sections 39.157(e) and 39.203   apply only to a municipally owned utility or an electric   cooperative that is offering customer choice.  If there is a   conflict between the specific provisions of this chapter and any   other provisions of this title, except for Chapters 40 and 41, the   provisions of this chapter control.          SECTION 4.  Subchapter D, Chapter 39, Utilities Code, is   amended by adding Sections 39.169 and 39.170 to read as follows:           Sec.   39.169.     CO-LOCATION OF LARGE LOAD CUSTOMER WITH   EXISTING GENERATION RESOURCE. (a)   A power generation company,   municipally owned utility, or electric cooperative must submit a   notice to the independent organization certified under Section   39.151 for the ERCOT power region before implementing a net   metering arrangement between an operating facility registered with   the independent organization as a stand-alone generation resource   as of September 1, 2025, and a new large load customer as described   by Section 37.0561(c).           (b)  This section does not apply to a generation resource:                 (1)     the registration for which included a co-located   large load customer at the time of energization, regardless of   whether the load was energized at a later date; or                 (2)     a majority interest of which is owned indirectly   or directly as of January 1, 2025, by a parent company of the   customer that participates in the new net metering arrangement.           (c)     The electric cooperative, transmission and distribution   utility, or municipally owned utility that provides electric   service at the location of the new net metering arrangement may for   reasonable cause including a violation of other law, object to the   arrangement, provided however, that no reasonable cause objection   may be raised after a final decision by the commission is issued   under this section.           (d)     The independent organization certified under Section   39.151 for the ERCOT power region shall study the system impacts of   a proposed net metering arrangement and removal of generation for   which the independent organization receives a notice under   Subsection (a) after the independent organization receives all   information regarding the arrangement required by the independent   organization to be submitted to the independent organization.   The   independent organization must complete the study and submit the   results to the commission with any associated recommendations not   later than the 120th day after the independent organization   receives all required information regarding the arran [Text truncated for display. Full text available on LegiScan.]