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Texas Bill Would Cap Wholesale Energy Prices During, After Disasters

Texas Bill Would Require Express Consent For Rollover From Fixed To Variable Rate

Texas Bill Would Expand Periods Of Time When Disconnections Are Prohibited

Texas Bill Would Authorize Utilities In ERCOT To Construct Facilities To Purchase Power Outside Of ERCOT

March 9, 2021

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Copyright 2010-21
Reporting by Paul Ring •

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Several additional bills impacting the Texas energy market have been filed at the Texas legislature

Express Consent For Rollover From Fixed To Variable Rate

HB 3138 would require a retail electric provider to obtain the customer's express consent to roll-over a customer from a fixed rate to a variable rate.

Specifically, HB 3138 would provide, "A retail electric provider may not enroll a customer in a rate plan that allows the provider to use a variable rate pricing structure after the expiration of a rate plan with a fixed-rate pricing structure without the customer's express consent. The consent must be given in a manner that indicates the customer understands that the customer is potentially enrolling in a variable rate plan. The retail electric provider shall provide notice that the plan includes variable rates in an easily readable font and type size."

Nothing in the text of HB 3138 limits its requirements to residential customer contracts

As first reported by, several other Texas bills have been introduced which seek a ban on variable rates or a prohibition on roll-overs to variable rates (see details here)

Expanded Prohibition On Disconnection

By amending the definition of, "extreme weather emergency", HB 3167 would prohibit retail electric providers from disconnecting a residential customer if, "the temperature exceeds 90 degrees Fahrenheit and the temperature is predicted to remain at or above that level for the next 24 hours according to the nearest National Weather Service reports," while also maintaining such a prohibition based on the current two definitions of an extreme weather emergency

Currently, with respect to high temperatures, statute only prevents disconnections in cases where the National Weather Service issues a heat advisory for any county in the relevant service territory, or when such an advisory has been issued on any one of the previous two calendar days. National Weather Service Heat Advisory criteria vary by region but generally are issued for temperatures (or heat indices) well-above 90 degrees Fahrenheit (such as a daytime high of at least 100 degrees), and thus the bill would generally expand the periods of time in which a disconnection prohibition is in effect

ERCOT Energy Market Price Cap During Disasters

HB 3166 would place a cap on ERCOT wholesale "energy" during a state of disaster resulting from a power supply shortage, a period of time thereafter

HB 3166 provides, "During a state of disaster declared by the governor under Chapter 418, Government Code, in response to an event that causes a power supply shortage in ERCOT and for 30 days after the termination of the disaster declaration, the price of wholesale energy sold in a market operated by the independent organization certified under Section 39.151 for the ERCOT power region may not exceed 200 percent of the average peak daily price of wholesale energy sold in the market in the previous 90 days."

System Benefit Fund

HB 3076 would re-establish the system benefit fund with the same requirements and level for REP discounts, reimbursed by the fund, as were in place in statute prior to the fund expiring. As before, the system benefit account would be financed by a nonbypassable fee set by the PUC in an amount not to exceed 65 cents per megawatt-hour.

Authorization For TDUs, Other Utilities To Construct Facilities To Purchase Power Outside Of ERCOT

HB 3177 would provide that, "Notwithstanding any other law, a transmission and distribution utility, municipally owned utility, or electric cooperative that transmits or distributes power purchased at wholesale in the ERCOT power region may construct, own, and operate facilities as necessary to: (1) access transmission service from outside of the ERCOT power region; and (2) purchase power at wholesale from outside of the ERCOT power region."

HB 3177 could implicate federal jurisdiction due to such facilities and potential purchase of power from outside of ERCOT

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