2023 Texas Statutes › Utilities Code › Title 2 - Public Utility Regulatory Act › Subtitle B - Electric Utilities › Chapter 37 - Certificates of Convenience and Necessity › Subchapter B. Certificate of Convenience and Necessity › Section 37.056. Grant or Denial of Certificate

Sec. 37.056.  GRANT OR DENIAL OF CERTIFICATE.  (a)  The commission may approve an application and grant a certificate only if the commission finds that the certificate is necessary for the service, accommodation, convenience, or safety of the public.
(b)  The commission may:
(1)  grant the certificate as requested;
(2)  grant the certificate for the construction of a portion of the requested system, facility, or extension or the partial exercise of the requested right or privilege;  or
(3)  refuse to grant the certificate.
(c)  The commission shall grant each certificate on a nondiscriminatory basis after considering:
(1)  the adequacy of existing service;
(2)  the need for additional service;
(3)  the effect of granting the certificate on the recipient of the certificate and any electric utility serving the proximate area; and
(4)  other factors, such as:
(A)  community values;
(B)  recreational and park areas;
(C)  historical and aesthetic values;
(D)  environmental integrity;
(E)  the probable improvement of service or lowering of cost to consumers in the area if the certificate is granted, including any potential economic or reliability benefits associated with dual fuel and fuel storage capabilities in areas outside the ERCOT power region; and
(F)  the need for extending transmission service where existing or projected electrical loads will be underserved, including where:
(i)  the existing transmission service is unreasonably remote;
(ii)  the available capacity is unreasonably limited at transmission or distribution voltage level; or
(iii)  the electrical load cannot be interconnected in a timely manner.
(c-1)  In considering the need for additional service under Subsection (c)(2) for a reliability transmission project that serves the ERCOT power region or under Subsection (c)(4)(F), the commission must consider the historical load, forecasted load growth, and additional load currently seeking interconnection, including load for which the electric utility has yet to sign an interconnection agreement, as determined by the electric utility with the responsibility for serving the load.
(d)  The commission by rule shall establish criteria, in addition to the criteria described by Subsection (c), for granting a certificate for a transmission project that serves the ERCOT power region and that is not necessary to meet state or federal reliability standards.  The criteria must include a comparison of the estimated cost of the transmission project for consumers and the estimated congestion cost savings for consumers that may result from the transmission project, considering both current and future expected congestion levels and the transmission project's ability to reduce those congestion levels.  The commission shall include with its decision on an application for a certificate to which this subsection applies findings on the criteria.
(e)  A certificate to build, own, or operate a new transmission facility that directly interconnects with an existing electric utility facility or municipally owned utility facility may be granted only to the owner of that existing facility.  If a new transmission facility will directly interconnect with facilities owned by different electric utilities or municipally owned utilities, each entity shall be certificated to build, own, or operate the new facility in separate and discrete equal parts unless they agree otherwise.
(f)  Notwithstanding Subsection (e), if a new transmission line, whether single or double circuit, will create the first interconnection between a load-serving station and an existing transmission facility, the entity with a load-serving responsibility or an electric cooperative that has a member with a load-serving responsibility at the load-serving station shall be certificated to build, own, or operate the new transmission line and the load-serving station.  The owner of the existing transmission facility shall be certificated to build, own, or operate the station or tap at the existing transmission facility to provide the interconnection, unless after a reasonable period of time the owner of the existing transmission facility is unwilling to build, and then the entity with the load-serving responsibility or an electric cooperative that has a member with a load-serving responsibility may be certificated to build the interconnection facility.
(g)  Notwithstanding any other provision of this section, an electric utility or municipally owned utility that is authorized to build, own, or operate a new transmission facility under Subsection (e) or (f) may designate another electric utility that is currently certificated by the commission within the same electric power region, coordinating council, independent system operator, or power pool or a municipally owned utility to build, own, or operate a portion or all of such new transmission facility, subject to any requirements adopted by the commission by rule.
(h)  The division of any required certification of facilities described in this section shall apply unless each entity agrees otherwise.  Nothing in this section is intended to require a certificate for facilities that the commission has determined by rule do not require certification to build, own, or operate.
(i)  Notwithstanding any other provision of this section, an electric cooperative may be certificated to build, own, or operate a new facility in place of any other electric cooperative if both cooperatives agree.
Acts 1997, 75th Leg., ch. 166, Sec. 1, eff. Sept. 1, 1997.  Amended by Acts 2003, 78th Leg., ch. 295, Sec. 2, eff. June 18, 2003.
Amended by:
Acts 2011, 82nd Leg., R.S., Ch. 949 (H.B. 971), Sec. 2(a), eff. June 17, 2011.
Acts 2019, 86th Leg., R.S., Ch. 44 (S.B. 1938), Sec. 4, eff. May 16, 2019.
Acts 2021, 87th Leg., R.S., Ch. 198 (H.B. 1510), Sec. 3, eff. June 1, 2021.
Acts 2021, 87th Leg., R.S., Ch. 876 (S.B. 1281), Sec. 2, eff. September 1, 2021.
Acts 2023, 88th Leg., R.S., Ch. 410 (H.B. 1500), Sec. 12, eff. September 1, 2023.
Acts 2023, 88th Leg., R.S., Ch. 892 (H.B. 5066), Sec. 1, eff. June 13, 2023.