reglab/statecodes huggingface dataset:
2023 Texas Statutes › Utilities Code › Title 2 - Public Utility Regulatory Act › Subtitle B - Electric Utilities › Chapter 36 - Rates › Subchapter B. Computation of Rates › Section 36.064. Self-Insurance

Sec. 36.064.  SELF-INSURANCE.  (a)  An electric utility may self-insure all or part of the utility's potential liability or catastrophic property loss, including windstorm, fire, and explosion losses, that could not have been reasonably anticipated and included under operating and maintenance expenses.
(b)  The commission shall approve a self-insurance plan under this section if the commission finds that:
(1)  the coverage is in the public interest;
(2)  the plan, considering all costs, is a lower cost alternative to purchasing commercial insurance;  and
(3)  ratepayers will receive the benefits of the savings.
(c)  In computing an electric utility's reasonable and necessary expenses under this subchapter, the regulatory authority, to the extent the regulatory authority finds is in the public interest, shall allow as a necessary expense the money credited to a reserve account for self-insurance.  The regulatory authority shall determine reasonableness under this subsection:
(1)  from information provided at the time the self-insurance plan and reserve account are established;  and
(2)  on the filing of a rate case by an electric utility that has a reserve account.
(d)  After a reserve account for self-insurance is established, the regulatory authority shall:
(1)  determine whether the reserve account has a surplus or shortage under Subsection (e);  and
(2)  subtract any surplus from or add any shortage to the utility's rate base.
(e)  A surplus in the reserve account exists if the charges against the account are less than the money credited to the account.  A shortage in the reserve account exists if the charges against the account are greater than the money credited to the account.
(f)  The allowance for self-insurance under this title for ratemaking purposes is not applicable to nuclear plant investment.
(g)  The commission shall adopt rules governing self-insurance under this section.
Acts 1997, 75th Leg., ch. 166, Sec. 1, eff. Sept. 1, 1997.
2023 Texas Statutes › Utilities Code › Title 2 - Public Utility Regulatory Act › Subtitle B - Electric Utilities › Chapter 36 - Rates › Subchapter B. Computation of Rates › Section 36.065. Pension and Other Postemployment Benefits

Sec. 36.065.  PENSION AND OTHER POSTEMPLOYMENT BENEFITS.  (a)  The regulatory authority shall include in the rates of an electric utility expenses for pension and other postemployment benefits, as determined by actuarial or other similar studies in accordance with generally accepted accounting principles, in an amount the regulatory authority finds reasonable.  Expenses for pension and other postemployment benefits include, in an amount found reasonable by the regulatory authority, the benefits attributable to the service of employees who were employed by the predecessor integrated electric utility of an electric utility before the utility's unbundling under Chapter 39 irrespective of the business activity performed by the employee or the affiliate to which the employee was transferred on or after the unbundling.
(b)  An electric utility may establish one or more reserve accounts for expenses for pension and other postemployment benefits.  An electric utility shall periodically record in the reserve account any difference between:
(1)  the annual amount of pension and other postemployment benefits approved as an expense in the electric utility's last general rate proceeding or, if that amount cannot be determined from the regulatory authority's order, the amount recorded for pension and other postemployment benefits under generally accepted accounting principles during the first year that rates from the electric utility's last general rate proceeding are in effect; and
(2)  the annual amount of pension and other postemployment benefits as determined by actuarial or other similar studies that are chargeable to the electric utility's expense.
(c)  A surplus in the reserve account exists if the amount of pension and other postemployment benefits under Subsection (b)(1) is greater than the amount determined under Subsection (b)(2).  A shortage in the reserve account exists if the amount of pension and other postemployment benefits under Subsection (b)(1) is less than the amount determined under Subsection (b)(2).
(d)  If a reserve account for pension and other postemployment benefits is established, the regulatory authority at a subsequent general rate proceeding shall:
(1)  review the amounts recorded to the reserve account to determine whether the amounts are reasonable expenses;
(2)  determine whether the reserve account has a surplus or shortage under Subsection (c); and
(3)  subtract any surplus from or add any shortage to the electric utility's rate base with the surplus or shortage amortized over a reasonable time.
Added by Acts 2005, 79th Leg., Ch. 385 (S.B. 1447), Sec. 1, eff. June 17, 2005.
Amended by:
Acts 2017, 85th Leg., R.S., Ch. 51 (S.B. 1002), Sec. 1, eff. May 22, 2017.
2023 Texas Statutes › Utilities Code › Title 2 - Public Utility Regulatory Act › Subtitle B - Electric Utilities › Chapter 36 - Rates › Subchapter B. Computation of Rates › Section 36.066. Costs Related to Reporting on Safety Processes and Inspections for Certain Utilities

Sec. 36.066.  COSTS RELATED TO REPORTING ON SAFETY PROCESSES AND INSPECTIONS FOR CERTAIN UTILITIES.  (a)  Costs incurred by an electric utility to comply with Section 38.102 shall be recorded as a regulatory asset for timely recovery in rates established by the commission.
(b)  The commission may adopt rules relating to the recording of regulatory assets under this section.
Added by Acts 2019, 86th Leg., R.S., Ch. 1320 (H.B. 4150), Sec. 3, eff. September 1, 2019.
2023 Texas Statutes › Utilities Code › Title 2 - Public Utility Regulatory Act › Subtitle B - Electric Utilities › Chapter 36 - Rates › Subchapter B. Computation of Rates › Section 36.067. Consideration of Compensation and Benefit Expenses

Sec. 36.067.  CONSIDERATION OF COMPENSATION AND BENEFIT EXPENSES.  (a)  In this section, "employee compensation and benefits" includes base salaries, wages, incentive compensation, and benefits. The term does not include:
(1)  pension or other postemployment benefits; or
(2)  incentive compensation for an officer of an electric utility related to attaining:
(A)  financial metrics; or
(B)  metrics adverse to customers' interests as determined by the commission.
(b)  When establishing an electric utility's rates, the regulatory authority shall presume that employee compensation and benefits expenses are reasonable and necessary if the expenses are consistent with market compensation studies issued not earlier than three years before the initiation of the proceeding to establish the rates.
Added by Acts 2023, 88th Leg., R.S., Ch. 3 (S.B. 1016), Sec. 1, eff. May 5, 2023.
2023 Texas Statutes › Utilities Code › Title 2 - Public Utility Regulatory Act › Subtitle B - Electric Utilities › Chapter 36 - Rates › Subchapter C. General Procedures for Rate Changes Proposed by Utility › Section 36.101. Definition

Sec. 36.101.  DEFINITION.  In this subchapter, "major change" means an increase in rates that would increase the aggregate revenues of the applicant more than the greater of $100,000 or 2-1/2 percent.  The term does not include an increase in rates that the regulatory authority allows to go into effect or the electric utility makes under an order of the regulatory authority after hearings held with public notice.
Acts 1997, 75th Leg., ch. 166, Sec. 1, eff. Sept. 1, 1997.
2023 Texas Statutes › Utilities Code › Title 2 - Public Utility Regulatory Act › Subtitle B - Electric Utilities › Chapter 36 - Rates › Subchapter C. General Procedures for Rate Changes Proposed by Utility › Section 36.102. Statement of Intent to Change Rates

Sec. 36.102.  STATEMENT OF INTENT TO CHANGE RATES.  (a)  Except as provided by Section 33.024, an electric utility may not change its rates unless the utility files a statement of its intent with the regulatory authority that has original jurisdiction over those rates at least 35 days before the effective date of the proposed change.
(b)  The electric utility shall also mail or deliver a copy of the statement of intent to the appropriate officer of each affected municipality.
(c)  The statement of intent must include:
(1)  proposed revisions of tariffs;  and
(2)  a detailed statement of:
(A)  each proposed change;
(B)  the effect the proposed change is expected to have on the revenues of the utility;
(C)  each class and number of utility consumers affected;  and
(D)  any other information required by the regulatory authority's rules.
Acts 1997, 75th Leg., ch. 166, Sec. 1, eff. Sept. 1, 1997.
2023 Texas Statutes › Utilities Code › Title 2 - Public Utility Regulatory Act › Subtitle B - Electric Utilities › Chapter 36 - Rates › Subchapter C. General Procedures for Rate Changes Proposed by Utility › Section 36.103. Notice of Intent to Change Rates

Sec. 36.103.  NOTICE OF INTENT TO CHANGE RATES.  (a)  The electric utility shall:
(1)  publish, in conspicuous form and place, notice to the public of the proposed change once each week for four successive weeks before the effective date of the proposed change in a newspaper having general circulation in each county containing territory affected by the proposed change;  and
(2)  mail notice of the proposed change to any other affected person as required by the regulatory authority's rules.
(b)  The regulatory authority may waive the publication of notice requirement prescribed by Subsection (a) in a proceeding that involves only a rate reduction for each affected ratepayer.  The applicant shall give notice of the proposed rate change by mail to each affected utility customer.
(c)  The regulatory authority by rule shall define other proceedings for which the publication of notice requirement prescribed by Subsection (a) may be waived on a showing of good cause.  A waiver may not be granted in a proceeding involving a rate increase to any class or category of ratepayer.
Acts 1997, 75th Leg., ch. 166, Sec. 1, eff. Sept. 1, 1997.
2023 Texas Statutes › Utilities Code › Title 2 - Public Utility Regulatory Act › Subtitle B - Electric Utilities › Chapter 36 - Rates › Subchapter C. General Procedures for Rate Changes Proposed by Utility › Section 36.104. Early Effective Date of Rate Change

Sec. 36.104.  EARLY EFFECTIVE DATE OF RATE CHANGE.  (a)  For good cause shown, the regulatory authority may allow a rate change, other than a major change, to take effect:
(1)  before the end of the 35-day period prescribed by Section 36.102;  and
(2)  under conditions the regulatory authority prescribes, subject to suspension as provided by this subchapter.
(b)  The electric utility shall immediately revise its tariffs to include the change.
Acts 1997, 75th Leg., ch. 166, Sec. 1, eff. Sept. 1, 1997.
2023 Texas Statutes › Utilities Code › Title 2 - Public Utility Regulatory Act › Subtitle B - Electric Utilities › Chapter 36 - Rates › Subchapter C. General Procedures for Rate Changes Proposed by Utility › Section 36.105. Determination of Propriety of Rate Change; Hearing

Sec. 36.105.  DETERMINATION OF PROPRIETY OF RATE CHANGE;  HEARING.  (a)  If a tariff changing rates is filed with a regulatory authority, the regulatory authority shall, on complaint by an affected person, or may, on its own motion, not later than the 30th day after the effective date of the change, enter on a hearing to determine the propriety of the change.
(b)  The regulatory authority shall hold a hearing in every case in which the change constitutes a major change.  The regulatory authority may, however, use an informal proceeding if the regulatory authority does not receive a complaint before the 46th day after the date notice of the change is filed.
(c)  The regulatory authority shall give reasonable notice of the hearing, including notice to the governing body of each affected municipality and county.  The electric utility is not required to provide a formal answer or file any other formal pleading in response to the notice, and the absence of an answer does not affect an order for a hearing.
Acts 1997, 75th Leg., ch. 166, Sec. 1, eff. Sept. 1, 1997.
2023 Texas Statutes › Utilities Code › Title 2 - Public Utility Regulatory Act › Subtitle B - Electric Utilities › Chapter 36 - Rates › Subchapter C. General Procedures for Rate Changes Proposed by Utility › Section 36.106. Regional Hearing

Sec. 36.106.  REGIONAL HEARING.  The commission shall hold a regional hearing at an appropriate location in a case in which the commission determines it is in the public interest to hear testimony at a regional hearing for inclusion in the record.
Acts 1997, 75th Leg., ch. 166, Sec. 1, eff. Sept. 1, 1997.
2023 Texas Statutes › Utilities Code › Title 2 - Public Utility Regulatory Act › Subtitle B - Electric Utilities › Chapter 36 - Rates › Subchapter C. General Procedures for Rate Changes Proposed by Utility › Section 36.107. Preference to Hearing

Sec. 36.107.  PREFERENCE TO HEARING.  The regulatory authority shall:
(1)  give preference to a hearing under this subchapter and to deciding questions arising under this subchapter and Subchapter E  over any other question pending before it;  and
(2)  decide the questions as quickly as possible.
Acts 1997, 75th Leg., ch. 166, Sec. 1, eff. Sept. 1, 1997.
2023 Texas Statutes › Utilities Code › Title 2 - Public Utility Regulatory Act › Subtitle B - Electric Utilities › Chapter 36 - Rates › Subchapter C. General Procedures for Rate Changes Proposed by Utility › Section 36.108. Rate Suspension; Deadline

Sec. 36.108.  RATE SUSPENSION;  DEADLINE.  (a)  Pending the hearing and a decision:
(1)  the local regulatory authority, after delivering to the electric utility a written statement of the regulatory authority's reasons, may suspend the rate change for not longer than 90 days after the date the rate change would otherwise be effective;  and
(2)  the commission may suspend the rate change for not longer than 150 days after the date the rate change would otherwise be effective.
(b)  The 150-day period prescribed by Subsection (a)(2) shall be extended two days for each day the actual hearing on the merits of the case exceeds 15 days.
(c)  If the regulatory authority does not make a final determination concerning a rate change before expiration of the applicable suspension period, the regulatory authority is considered to have approved the change.  This approval is subject to the authority of the regulatory authority thereafter to continue a hearing in progress.
Acts 1997, 75th Leg., ch. 166, Sec. 1, eff. Sept. 1, 1997.
2023 Texas Statutes › Utilities Code › Title 2 - Public Utility Regulatory Act › Subtitle B - Electric Utilities › Chapter 36 - Rates › Subchapter C. General Procedures for Rate Changes Proposed by Utility › Section 36.109. Temporary Rates

Sec. 36.109.  TEMPORARY RATES.  (a)  The regulatory authority may establish temporary rates to be in effect during the applicable suspension period under Section 36.108.
(b)  If the regulatory authority does not establish temporary rates, the rates in effect when the suspended tariff was filed continue in effect during the suspension period.
Acts 1997, 75th Leg., ch. 166, Sec. 1, eff. Sept. 1, 1997.
2023 Texas Statutes › Utilities Code › Title 2 - Public Utility Regulatory Act › Subtitle B - Electric Utilities › Chapter 36 - Rates › Subchapter C. General Procedures for Rate Changes Proposed by Utility › Section 36.110. Bonded Rates

Sec. 36.110.  BONDED RATES.  (a)  An electric utility may put a changed rate into effect throughout the area in which the utility sought to change its rates, including an area over which the commission is exercising appellate or original jurisdiction, by filing a bond with the commission if:
(1)  the 150-day suspension period has been extended under Section 36.108(b);  and
(2)  the commission fails to make a final determination before the 151st day after the date the rate change would otherwise be effective.
(b)  The bonded rate may not exceed the proposed rate.
(c)  The bond must be:
(1)  payable to the commission in an amount, in a form, and with a surety approved by the commission;  and
(2)  conditioned on refund.
(d)  The electric utility shall refund or credit against future bills:
(1)  money collected under the bonded rates in excess of the rate finally ordered;  and
(2)  interest on that money, at the current interest rate as determined by the commission.
Acts 1997, 75th Leg., ch. 166, Sec. 1, eff. Sept. 1, 1997.
2023 Texas Statutes › Utilities Code › Title 2 - Public Utility Regulatory Act › Subtitle B - Electric Utilities › Chapter 36 - Rates › Subchapter C. General Procedures for Rate Changes Proposed by Utility › Section 36.111. Establishment of Final Rates

Sec. 36.111.  ESTABLISHMENT OF FINAL RATES.  (a)  If, after hearing, the regulatory authority finds the rates are unreasonable or in violation of law, the regulatory authority shall:
(1)  enter an order establishing the rates the electric utility shall charge or apply for the service in question;  and
(2)  serve a copy of the order on the electric utility.
(b)  The rates established in the order shall be observed thereafter until changed as provided by this title.
Acts 1997, 75th Leg., ch. 166, Sec. 1, eff. Sept. 1, 1997.
For expiration of this section, see Subsection (g).
2023 Texas Statutes › Utilities Code › Title 2 - Public Utility Regulatory Act › Subtitle B - Electric Utilities › Chapter 36 - Rates › Subchapter C. General Procedures for Rate Changes Proposed by Utility › Section 36.112. Cost Recovery and Rate Adjustment Standards and Procedures for Certain Non-Ercot Utilities

Sec. 36.112.  COST RECOVERY AND RATE ADJUSTMENT STANDARDS AND PROCEDURES FOR CERTAIN NON-ERCOT UTILITIES.  (a)  This section applies only to an electric utility that operates solely outside of ERCOT.
(b)  In establishing the base rates of the electric utility under this subchapter or Subchapter D, the regulatory authority shall determine the utility's revenue requirement based on, at the election of the utility:
(1)  information submitted for a test year; or
(2)  information submitted for a test year, updated to include information that reflects the most current actual or estimated information regarding increases and decreases in the utility's cost of service, including expenses, capital investment, cost of capital, and sales.
(c)  An electric utility that elects to provide updated information under Subsection (b)(2) must provide the information for a period ending not later than the 30th day before the date the applicable rate proceeding is filed.
(d)  An electric utility that includes estimated information in the initial filing of a proceeding shall supplement the filing with actual information not later than the 45th day after the date the initial filing was made. The regulatory authority shall extend the deadline for concluding the rate proceeding for a period of time equal to the period between the date the initial filing of the proceeding was made and the date of the supplemental filing, except that the extension period may not exceed 45 days.
(e)  An electric utility that makes an election under Subsection (b) is not precluded from proposing known and measurable adjustments to the utility's historical rate information as permitted by this title and regulatory authority rules.
(f)  Without limiting the availability of known and measurable adjustments described by Subsection (e), the regulatory authority shall allow an affected electric utility to make a known and measurable adjustment to include in the utility's rates the prudent capital investment, a reasonable return on such capital investment, depreciation expense, reasonable and necessary operating expenses, and all attendant impacts, including any offsetting revenue, as determined by the regulatory authority, associated with a newly constructed or acquired natural gas-fired generation facility. The regulatory authority is required to allow the adjustment only if the facility is in service before the effective date of new rates. The adjustment may be made regardless of whether the investment is less than 10 percent of the utility's rate base before the date of the adjustment.
(g)  This section expires September 1, 2031.
Added by Acts 2015, 84th Leg., R.S., Ch. 733 (H.B. 1535), Sec. 1, eff. June 17, 2015.
Amended by:
Acts 2019, 86th Leg., R.S., Ch. 1067 (H.B. 1397), Sec. 1, eff. June 14, 2019.
2023 Texas Statutes › Utilities Code › Title 2 - Public Utility Regulatory Act › Subtitle B - Electric Utilities › Chapter 36 - Rates › Subchapter D. Rate Changes Proposed by Regulatory Authority › Section 36.151. Unreasonable or Violative Existing Rates

Sec. 36.151.  UNREASONABLE OR VIOLATIVE EXISTING RATES.  (a)  If the regulatory authority, on its own motion or on complaint by an affected person, after reasonable notice and hearing, finds that the existing rates of an electric utility for a service are unreasonable or in violation of law, the regulatory authority shall:
(1)  enter an order establishing the just and reasonable rates to be observed thereafter, including maximum or minimum rates;  and
(2)  serve a copy of the order on the electric utility.
(b)  The rates established under Subsection (a) constitute the legal rates of the electric utility until changed as provided by this title.
Acts 1997, 75th Leg., ch. 166, Sec. 1, eff. Sept. 1, 1997.
2023 Texas Statutes › Utilities Code › Title 2 - Public Utility Regulatory Act › Subtitle B - Electric Utilities › Chapter 36 - Rates › Subchapter D. Rate Changes Proposed by Regulatory Authority › Section 36.152. Investigating Costs of Obtaining Service From Another Source

Sec. 36.152.  INVESTIGATING COSTS OF OBTAINING SERVICE FROM ANOTHER SOURCE.  If an electric utility does not produce or generate the service that it distributes, transmits, or furnishes to the public for compensation but obtains the service from another source, the regulatory authority may investigate the cost of that production or generation in an investigation of the reasonableness of the electric utility's rates.
Acts 1997, 75th Leg., ch. 166, Sec. 1, eff. Sept. 1, 1997.
2023 Texas Statutes › Utilities Code › Title 2 - Public Utility Regulatory Act › Subtitle B - Electric Utilities › Chapter 36 - Rates › Subchapter D. Rate Changes Proposed by Regulatory Authority › Section 36.153. Rate-Filing Package

Sec. 36.153.  RATE-FILING PACKAGE.  (a)  An electric utility shall file a rate-filing package with the regulatory authority not later than the 120th day after the date the authority notifies the utility that the authority will proceed with an inquiry under Section 36.151.
(b)  The regulatory authority may grant an extension of the 120-day period prescribed by Subsection (a) or waive the rate-filing package requirement on agreement of the parties.
Acts 1997, 75th Leg., ch. 166, Sec. 1, eff. Sept. 1, 1997.
2023 Texas Statutes › Utilities Code › Title 2 - Public Utility Regulatory Act › Subtitle B - Electric Utilities › Chapter 36 - Rates › Subchapter D. Rate Changes Proposed by Regulatory Authority › Section 36.154. Deadline

Sec. 36.154.  DEADLINE.  (a)  The regulatory authority shall make a final determination not later than the 185th day after the date the electric utility files the rate-filing package required by Section 36.153.
(b)  The deadline prescribed by Subsection (a) is extended two days for each day the actual hearing on the merits of the case exceeds 15 days.
Acts 1997, 75th Leg., ch. 166, Sec. 1, eff. Sept. 1, 1997.
2023 Texas Statutes › Utilities Code › Title 2 - Public Utility Regulatory Act › Subtitle B - Electric Utilities › Chapter 36 - Rates › Subchapter D. Rate Changes Proposed by Regulatory Authority › Section 36.155. Interim Order Establishing Temporary Rates

Sec. 36.155.  INTERIM ORDER ESTABLISHING TEMPORARY RATES.  (a)  At any time after an initial complaint is filed under Section 36.151, the regulatory authority may issue an interim order establishing temporary rates for the electric utility to be in effect until a final determination is made.
(b)  On issuance of a final order, the regulatory authority:
(1)  may require the electric utility to refund to customers or to credit against future bills:
(A)  money collected under the temporary rates in excess of the rate finally ordered;  and
(B)  interest on that money, at the current interest rate as determined by the commission;  or
(2)  shall authorize the electric utility to surcharge bills to recover:
(A)  the amount by which the money collected under the temporary rates is less than the money that would have been collected under the rate finally ordered;  and
(B)  interest on that amount, at the current interest rate as determined by the commission.
Acts 1997, 75th Leg., ch. 166, Sec. 1, eff. Sept. 1, 1997.
2023 Texas Statutes › Utilities Code › Title 2 - Public Utility Regulatory Act › Subtitle B - Electric Utilities › Chapter 36 - Rates › Subchapter D. Rate Changes Proposed by Regulatory Authority › Section 36.156. Automatic Temporary Rates

Sec. 36.156.  AUTOMATIC TEMPORARY RATES.  (a)  The rates charged by the electric utility on the 185th day after the date the utility files the rate-filing package required by Section 36.153 automatically become temporary rates if:
(1)  the 185-day period has been extended under Section 36.154(b);  and
(2)  the regulatory authority has not issued a final order or established temporary rates for the electric utility on or before the 185th day.
(b)  On issuance of a final order, the regulatory authority:
(1)  shall require the electric utility to refund to customers or to credit against future bills:
(A)  money collected under the temporary rates in excess of the rate finally ordered;  and
(B)  interest on that money, at the current interest rate as determined by the commission;  or
(2)  shall authorize the electric utility to surcharge bills to recover:
(A)  the amount by which the money collected under the temporary rates is less than the money that would have been collected under the rate finally ordered;  and
(B)  interest on that amount, at the current interest rate as determined by the commission.
Acts 1997, 75th Leg., ch. 166, Sec. 1, eff. Sept. 1, 1997.
2023 Texas Statutes › Utilities Code › Title 2 - Public Utility Regulatory Act › Subtitle B - Electric Utilities › Chapter 36 - Rates › Subchapter D. Rate Changes Proposed by Regulatory Authority › Section 36.157. Rate Review Schedule

Sec. 36.157.  RATE REVIEW SCHEDULE.  (a)  This section applies only to an electric utility, other than a river authority, that operates solely inside ERCOT.
(b)  Notwithstanding any other provision of this title, not later than June 1, 2018, the commission by rule shall establish a schedule that requires an electric utility to make periodic filings with the commission to modify or review base rates charged by the electric utility.  The schedule may be established on the basis of:
(1)  the period since the commission entered the commission's final order in the electric utility's most recent base rate proceeding;
(2)  whether the electric utility has earned materially more than the utility's authorized rate of return on equity as demonstrated by earnings monitoring reports; or
(3)  other criteria that the commission determines is in the public interest.
(c)  The commission shall extend the date for the proceeding required by Subsection (b) by one year on a year-to-year basis if, 180 days before the date the proceeding is required, the electric utility's most recent earnings monitoring report shows the electric utility is earning, on a weather-normalized basis, less than 50 basis points above:
(1)  for a transmission and distribution utility, the average of the most recent commission-approved rate of return on equity for each transmission and distribution utility with 175,000 or more metered customers; and
(2)  for a transmission-only utility, the average of the most recent commission-approved rate of return on equity for each transmission-only utility.
(d)  The commission may extend the date for the proceeding required by Subsection (b) for good cause shown or because of resource constraints of the commission.
(e)  This section does not limit the ability of a regulatory authority to initiate a base rate proceeding at any time under this title.
Added by Acts 2017, 85th Leg., R.S., Ch. 200 (S.B. 735), Sec. 1, eff. May 27, 2017.
2023 Texas Statutes › Utilities Code › Title 2 - Public Utility Regulatory Act › Subtitle B - Electric Utilities › Chapter 36 - Rates › Subchapter E. Cost Recovery and Rate Adjustment › Section 36.201. Automatic Adjustment for Changes in Costs

Sec. 36.201.  AUTOMATIC ADJUSTMENT FOR CHANGES IN COSTS.  Except as permitted by Section 36.204, the commission may not establish a rate or tariff that authorizes an electric utility to automatically adjust and pass through to the utility's customers a change in the utility's fuel or other costs.
Acts 1997, 75th Leg., ch. 166, Sec. 1, eff. Sept. 1, 1997.  Amended by Acts 1999, 76th Leg., ch. 405, Sec. 26, eff. Sept. 1, 1999.
2023 Texas Statutes › Utilities Code › Title 2 - Public Utility Regulatory Act › Subtitle B - Electric Utilities › Chapter 36 - Rates › Subchapter E. Cost Recovery and Rate Adjustment › Section 36.202. Adjustment for Change in Tax Liability

Sec. 36.202.  ADJUSTMENT FOR CHANGE IN TAX LIABILITY.  (a)  The commission, on its own motion or on the petition of an electric utility, shall provide for the adjustment of the utility's billing to reflect an increase or decrease in the utility's tax liability to this state if the increase or decrease:
(1)  results from Chapter 5, Acts of the 72nd Legislature, 1st Called Session, 1991;  and
(2)  is attributable to an activity subject to the commission's jurisdiction.
(b)  The commission shall apportion pro rata to each type and class of service provided by the utility any billing adjustment under this section.  The adjustment:
(1)  shall be made effective at the same time as the increase or decrease of tax liability described by Subsection (a)(1) or as soon after that increase or decrease as is reasonably practical;  and
(2)  remains effective only until the commission alters the adjustment as provided by this section or enters an order for the utility under Subchapter C or D.
(c)  Each year after an original adjustment, the commission shall:
(1)  review the utility's increase or decrease of tax liability described by Subsection (a)(1);  and
(2)  alter the adjustment as necessary to reflect the increase or decrease.
(d)  A proceeding under this section is not a rate case under Subchapter C.
Acts 1997, 75th Leg., ch. 166, Sec. 1, eff. Sept. 1, 1997.
2023 Texas Statutes › Utilities Code › Title 2 - Public Utility Regulatory Act › Subtitle B - Electric Utilities › Chapter 36 - Rates › Subchapter E. Cost Recovery and Rate Adjustment › Section 36.204. Cost Recovery and Incentives

Sec. 36.204.  COST RECOVERY AND INCENTIVES.  In establishing rates for an electric utility, the commission may:
(1)  allow timely recovery of the reasonable costs of conservation, load management, and purchased power, notwithstanding Section 36.201;  and
(2)  authorize additional incentives for conservation, load management, purchased power, and renewable resources.
Acts 1997, 75th Leg., ch. 166, Sec. 1, eff. Sept. 1, 1997.  Amended by Acts 1999, 76th Leg., ch. 405, Sec. 27, eff. Sept. 1, 1999.
2023 Texas Statutes › Utilities Code › Title 2 - Public Utility Regulatory Act › Subtitle B - Electric Utilities › Chapter 36 - Rates › Subchapter E. Cost Recovery and Rate Adjustment › Section 36.205. Purchased Power Cost Recovery

Sec. 36.205.  PURCHASED POWER COST RECOVERY.  (a)  This section applies only to an increase or decrease in the cost of purchased electricity that has been:
(1)  accepted by a federal regulatory authority;  or
(2)  approved after a hearing by the commission.
(b)  The commission may use any appropriate method to provide for the adjustment of the cost of purchased electricity on terms determined by the commission.
(c)  Purchased electricity costs may be recovered:
(1)  concurrently with the effective date of the changed costs to the purchasing electric utility;  or
(2)  as soon after the effective date as reasonably practical.
(d)  The commission may provide a mechanism to allow an electric utility that has a noncontiguous geographical service area and that purchases power for resale for that noncontiguous service area from electric utilities that are not members of the Electric Reliability Council of Texas to recover purchased power costs for the area in a manner that reflects the purchased power cost for that specific geographical noncontiguous area.  The commission may not require an electric cooperative corporation to use the mechanism provided under this section unless the electric cooperative corporation requests its use.
(e)  Notwithstanding Subsection (a), an electric utility may apply to the commission for review and approval of an agreement between the electric utility and another person for the purchase of power by the electric utility if approval by the commission is a pre-condition to the effectiveness of the electric utility's right or obligation to purchase power under the agreement.  This subsection applies only to an agreement with a term of three years or more.  The commission by rule shall implement this subsection consistent with the standards and procedures in the commission's rules governing contested cases on certificates of convenience and necessity for generating facilities adopted under Sections 37.056 and 37.058.  This subsection expires September 1, 2033.
Acts 1997, 75th Leg., ch. 166, Sec. 1, eff. Sept. 1, 1997.
Amended by:
Acts 2023, 88th Leg., R.S., Ch. 1157 (S.B. 1094), Sec. 1, eff. September 1, 2023.
2023 Texas Statutes › Utilities Code › Title 2 - Public Utility Regulatory Act › Subtitle B - Electric Utilities › Chapter 36 - Rates › Subchapter E. Cost Recovery and Rate Adjustment › Section 36.206. Mark-Ups

Sec. 36.206.  MARK-UPS.  (a)  A cost recovery factor established for the recovery of purchased power costs may include:
(1)  the cost the electric utility incurs in purchasing capacity and energy;
(2)  a mark-up added to the cost or another mechanism the commission determines will reasonably compensate the utility for any financial risk associated with purchased power obligations;  and
(3)  the value added by the utility in making the purchased power available to customers.
(b)  The mark-ups and cost recovery factors, if allowed, may be those necessary to encourage the electric utility to include economical purchased power as part of the utility's energy and capacity resource supply plan.
Acts 1997, 75th Leg., ch. 166, Sec. 1, eff. Sept. 1, 1997.
2023 Texas Statutes › Utilities Code › Title 2 - Public Utility Regulatory Act › Subtitle B - Electric Utilities › Chapter 36 - Rates › Subchapter E. Cost Recovery and Rate Adjustment › Section 36.207. Use of Mark-Ups

Sec. 36.207.  USE OF MARK-UPS.  Any mark-ups approved under Section 36.206 are an exceptional form of rate relief that the electric utility may recover from ratepayers only on a finding by the commission that the relief is necessary to maintain the utility's financial integrity.
Acts 1997, 75th Leg., ch. 166, Sec. 1, eff. Sept. 1, 1997.  Amended by Acts 1999, 76th Leg., ch. 405, Sec. 28, eff. Sept. 1, 1999.
2023 Texas Statutes › Utilities Code › Title 2 - Public Utility Regulatory Act › Subtitle B - Electric Utilities › Chapter 36 - Rates › Subchapter E. Cost Recovery and Rate Adjustment › Section 36.208. Payment to Qualifying Facility

Sec. 36.208.  PAYMENT TO QUALIFYING FACILITY.  In establishing an electric utility's rates, the regulatory authority shall:
(1)  consider a payment made to a qualifying facility under an agreement certified under Subchapter C, Chapter 35, to be a reasonable and necessary operating expense of the electric utility during the period for which the certification is effective;  and
(2)  allow full, concurrent, and monthly recovery of the amount of the payment.
Acts 1997, 75th Leg., ch. 166, Sec. 1, eff. Sept. 1, 1997.
2023 Texas Statutes › Utilities Code › Title 2 - Public Utility Regulatory Act › Subtitle B - Electric Utilities › Chapter 36 - Rates › Subchapter E. Cost Recovery and Rate Adjustment › Section 36.209. Recovery by Certain Non-Ercot Utilities of Certain Transmission Costs

Sec. 36.209.  RECOVERY BY CERTAIN NON-ERCOT UTILITIES OF CERTAIN TRANSMISSION COSTS.  (a)  This section applies only to an electric utility that operates solely outside of ERCOT in areas of this state included in the Southeastern Electric Reliability Council, the Southwest Power Pool, or the Western Electricity Coordinating Council and that owns or operates transmission facilities.
(b)  The commission, after notice and hearing, may allow an electric utility to recover on an annual basis its reasonable and necessary expenditures for transmission infrastructure improvement costs and changes in wholesale transmission charges to the electric utility under a tariff approved by a federal regulatory authority to the extent that the costs or charges have not otherwise been recovered.  The commission may allow the electric utility to recover only the costs allocable to retail customers in the state and may not allow the electric utility to over-recover costs.
Added by Acts 2005, 79th Leg., Ch. 1024 (H.B. 989), Sec. 1, eff. June 18, 2005.
Amended by:
Acts 2009, 81st Leg., R.S., Ch. 1226 (S.B. 1492), Sec. 1, eff. June 19, 2009.
2023 Texas Statutes › Utilities Code › Title 2 - Public Utility Regulatory Act › Subtitle B - Electric Utilities › Chapter 36 - Rates › Subchapter E. Cost Recovery and Rate Adjustment › Section 36.211. Relation Back of Rates for Certain Non-Ercot Utilities

Sec. 36.211.  RELATION BACK OF RATES FOR CERTAIN NON-ERCOT UTILITIES. (a) This section applies only to an electric utility that operates solely outside of ERCOT.
(b)  In a rate proceeding under Subchapter D, or if requested by an electric utility in the utility's statement of intent initiating a rate proceeding under Subchapter C, notwithstanding Section 36.109(a), the final rate set in the proceeding, whether a rate increase or rate decrease, shall be made effective for consumption on and after the 155th day after the date the rate-filing package is filed.
(c)  The regulatory authority shall:
(1)  require the electric utility to refund to customers money collected in excess of the rate finally ordered on or after the 155th day after the date the rate-filing package is filed; or
(2)  authorize the electric utility to surcharge bills to recover the amount by which the money collected on or after the 155th day after the date the rate-filing package is filed is less than the money that would have been collected under the rate finally ordered.
(d)  The regulatory authority may require refunds or surcharges of amounts determined under Subsection (c) over a period not to exceed 18 months, along with appropriate carrying costs. The regulatory authority shall make any adjustments necessary to prevent over-recovery of amounts reflected in riders in effect for the electric utility during the pendency of the rate proceeding.
(e)  A utility may not assess more than one surcharge authorized by Subsection (c)(2) at the same time.
(f)  This section expires September 1, 2031.
Added by Acts 2015, 84th Leg., R.S., Ch. 733 (H.B. 1535), Sec. 2, eff. June 17, 2015.
Amended by:
Acts 2019, 86th Leg., R.S., Ch. 1067 (H.B. 1397), Sec. 2, eff. June 14, 2019.
For expiration of this section, see Subsection (g).
2023 Texas Statutes › Utilities Code › Title 2 - Public Utility Regulatory Act › Subtitle B - Electric Utilities › Chapter 36 - Rates › Subchapter E. Cost Recovery and Rate Adjustment › Section 36.212. Rate Case Requirement for Certain Non-Ercot Utilities

Sec. 36.212.  RATE CASE REQUIREMENT FOR CERTAIN NON-ERCOT UTILITIES.  (a)  This section applies only to an electric utility that operates solely outside of ERCOT.
(b)  The commission shall require an electric utility to make the filings with regulatory authorities required by Subchapter B, Chapter 33, and to file a rate-filing package under Subchapter D with the commission to initiate a comprehensive base rate proceeding before all of the utility's regulatory authorities:
(1)  on or before the fourth anniversary of the date of the final order in the electric utility's most recent comprehensive base rate proceeding; or
(2)  if, before the anniversary described by Subdivision (1), the electric utility earns materially more than the utility's authorized rate of return on investment, on a weather-normalized basis, in the utility's two most recent consecutive commission earnings monitoring reports.
(c)  The electric utility must make the filings described by Subsection (b) not later than the 120th day after the date the commission notifies the utility of the requirement described by Subsection (b).  The 120-day period may be extended in the manner provided by Section 36.153(b).
(d)  The commission may extend the time period described by Subsection (b)(1) and set a new deadline if the commission determines that a comprehensive base rate case would not result in materially different rates.  The commission shall give interested parties a reasonable opportunity to present materials and argument before making a determination under this subsection.
(e)  The commission shall adopt rules implementing this section, including appropriate notice and scheduling requirements.
(f)  This section does not limit the authority of a regulatory authority under Subchapter D.
(g)  This section expires September 1, 2031.
Added by Acts 2015, 84th Leg., R.S., Ch. 733 (H.B. 1535), Sec. 3, eff. June 17, 2015.
Amended by:
Acts 2019, 86th Leg., R.S., Ch. 1067 (H.B. 1397), Sec. 3, eff. June 14, 2019.
2023 Texas Statutes › Utilities Code › Title 2 - Public Utility Regulatory Act › Subtitle B - Electric Utilities › Chapter 36 - Rates › Subchapter E. Cost Recovery and Rate Adjustment › Section 36.213. Adjustment for Cybersecurity Monitor Costs for Certain Utilities

Sec. 36.213.  ADJUSTMENT FOR CYBERSECURITY MONITOR COSTS FOR CERTAIN UTILITIES.  (a)  This section does not apply to an electric utility that operates solely outside of ERCOT and has not elected to participate in the cybersecurity monitor program under Section 39.1516.
(b)  The commission, on its own motion or on the petition of an electric utility, shall allow the electric utility to recover reasonable and necessary costs incurred in connection with activities under Section 39.1516.
Added by Acts 2019, 86th Leg., R.S., Ch. 610 (S.B. 936), Sec. 1, eff. September 1, 2019.
For expiration of this section, see Subsection (h).
2023 Texas Statutes › Utilities Code › Title 2 - Public Utility Regulatory Act › Subtitle B - Electric Utilities › Chapter 36 - Rates › Subchapter E. Cost Recovery and Rate Adjustment › Section 36.214. Recovery of Generation Investment by Non-Ercot Utilities

Sec. 36.214.  RECOVERY OF GENERATION INVESTMENT BY NON-ERCOT UTILITIES.  (a)  This section applies only to an electric utility that operates solely outside of ERCOT.
(b)  An electric utility may file, and the commission may approve, an application for a rider to recover the electric utility's investment in a power generation facility.
(c)  An application under Subsection (b) may be filed by the electric utility and approved by the commission before the electric utility places the power generation facility in service.
(d)  Any rider approved under Subsection (b) shall take effect on the date the power generation facility begins providing service to the electric utility's customers.
(e)  Amounts recovered through a rider approved under Subsection (b) are subject to reconciliation in the first comprehensive base rate proceeding for the electric utility that occurs after approval of the rider. During the reconciliation, the commission shall determine if the amounts recovered through the rider are reasonable and necessary.
(f)  If a rider approved under Subsection (b) includes incremental recovery for a power generation facility greater than $200 million on a Texas jurisdictional basis, the electric utility that filed the rider shall initiate a comprehensive base rate proceeding at the commission not later than 18 months after the date the rider takes effect.
(g)  The commission shall adopt rules as necessary to implement this section.
(h)  This section expires September 1, 2031.
Added by Acts 2019, 86th Leg., R.S., Ch. 1067 (H.B. 1397), Sec. 4, eff. June 14, 2019.
Redesignated from Utilities Code, Section 36.213 by Acts 2021, 87th Leg., R.S., Ch. 915 (H.B. 3607), Sec. 21.001(111), eff. September 1, 2021.
2023 Texas Statutes › Utilities Code › Title 2 - Public Utility Regulatory Act › Subtitle B - Electric Utilities › Chapter 36 - Rates › Subchapter H. Rates for Governmental Entities › Section 36.351. Discounted Rates for Certain Institutions of Higher Education

Sec. 36.351.  DISCOUNTED RATES FOR CERTAIN INSTITUTIONS OF HIGHER EDUCATION.  (a)  Notwithstanding any other provision of this title, each electric utility and municipally owned utility shall discount charges for electric service provided to a facility of a four-year state university, upper-level institution, Texas State Technical College, or college.
(b)  The discount is a 20-percent reduction of the utility's base rates that would otherwise be paid under the applicable tariffed rate.
(c)  An electric or municipally owned utility is exempt from this section if the 20-percent discount results in a reduction equal to more than one percent of the utility's total annual revenues.
(d)  A municipally owned utility is exempt from this section if the municipally owned utility, on September 1, 1995, discounted base commercial rates for electric service provided to all four-year state universities or colleges in its service area by 20 percent or more.
(e)  This section does not apply to a rate charged to an institution of higher education by a municipally owned utility that provides a discounted rate to the state for electric services below rates in effect on January 1, 1995, if the discounted rate provides a greater financial discount to the state than is provided to the institution of higher education through the discount provided by this section.
(f)  An investor-owned electric utility may not recover from residential customers or any other customer class the assigned and allocated costs of serving a state university or college that receives a discount under this section.
(g)  Each electric utility shall file tariffs with the commission reflecting the discount required under this section.  The initial tariff filing is not a rate change for purposes of Subchapter C.
Acts 1997, 75th Leg., ch. 166, Sec. 1, eff. Sept. 1, 1997.
2023 Texas Statutes › Utilities Code › Title 2 - Public Utility Regulatory Act › Subtitle B - Electric Utilities › Chapter 36 - Rates › Subchapter H. Rates for Governmental Entities › Section 36.352. Special Rate Class

Sec. 36.352.  SPECIAL RATE CLASS.  Notwithstanding any other provision of this title, if the commission, on or before September 1, 1995, approved the establishment of a separate rate class for electric service for a university and grouped public schools in a separate rate class, the commission shall include community colleges in the rate class with public school customers.
Acts 1997, 75th Leg., ch. 166, Sec. 1, eff. Sept. 1, 1997.
2023 Texas Statutes › Utilities Code › Title 2 - Public Utility Regulatory Act › Subtitle B - Electric Utilities › Chapter 36 - Rates › Subchapter H. Rates for Governmental Entities › Section 36.353. Payment in Lieu of Tax

Sec. 36.353.  PAYMENT IN LIEU OF TAX.  (a)  A payment made in lieu of a tax by a municipally owned utility to the municipality by which the utility is owned may not be considered an expense of operation in establishing the utility's rate for providing utility service to a school district or hospital district.
(b)  A rate a municipally owned utility receives from a school district or hospital district may not be used to make or to cover the cost of making payments in lieu of taxes to the municipality that owns the utility.
Acts 1997, 75th Leg., ch. 166, Sec. 1, eff. Sept. 1, 1997.