Fraser Bill Moves Cap Rock Electric to Regulated Utility Status
AUSTIN -- State Senator Troy Fraser, R-Horseshoe Bay, filed legislation today that makes Cap Rock Energy Corp. an investor-owned utility subject to rate regulation by the Texas Public Utility Commission.
The legislation, Senate Bill 1280, grants the PUC broad authority to establish schedules and procedures "as it deems necessary" to determine the time frame and conditions under which Cap Rock Energy would be subject to competition for electric customers, Fraser said.
"This bill repeals the amendment that was added to the electric deregulation bill in 1999," Fraser said. "It moves Cap Rock out of regulatory no-man's land and puts it under the authority of the PUC as an investor-owned utility. Hopefully, Cap Rock customers in West Texas will see lower rates as a result."
Under the bill, the PUC is required to take numerous factors into consideration to determine when market competition applies to Cap Rock, including the effect that customer choice would have on reliability of service to its customers.
Cap Rock Energy, based in Midland, formerly operated as a not-for-profit electric cooperative. In 1998, members of Cap Rock Electric Cooperative approved a business conversion plan to become a publicly traded company.
"The Cap Rock amendment was sold to the Legislature as an experiment to enable the coops to compete long-term against the larger investor-owned utilities," Fraser said. "It appears that experiment has been a failure."