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August 22, 2000     (512) 463-0300

JOINT OVERSIGHT COMMITTEE ON ELECTRIC UTILITY RESTRUCTURING MEETS AT GEORGE R. BROWN CONVENTION CENTER IN HOUSTON

HOUSTON - The Joint Committee on Oversight of Electric Utility Restructuring held a public hearing on Tuesday, August 22, 2000 at the George R. Brown Convention Center in Houston. The committee was created by Senate Bill (SB)7 during the 76th Legislature, Regular Session. The group is charged with overseeing the implementation of SB 7, the electric utility restructuring bill, and monitoring its effectiveness. Under SB 7, the electric utility market will be opened to competition by January of 2002.

The joint committee includes five members of the Texas Senate, appointed by the lieutenant governor, and five members of the Texas House of Representatives, appointed by the speaker. The committee is chaired by Waco Senator David Sibley and Dallas State Representative Steve Wolens, co-authors of SB 7. Senators include David Cain of Dallas, Frank L. Madla of San Antonio, Jane Nelson of Flower Mound, and John Whitmire of Houston. Representatives include Kim Brimer of Arlington, David Counts of Knox City, Debra Danburg of Houston, and Sylvester Turner of Houston. Senators Ken Armbrister of Victoria and Mike Jackson of La Porte and Representatives Kevin Bailey of Houston and Tommy Merritt of Longview joined the committee for the proceedings.

Lawmakers and utility regulators used the hearing to reassure Texans that the electricity problems plaguing consumers in California's deregulated electric industry will not occur in Texas' restructured power market. This summer, Californians have suffered steep electric bill increases and the threat of rolling blackouts as high power usage has overwhelmed state power plants. Some businesses and schools have closed intermittently in order to cut down on electricity consumption.

The hearing began with testimony from Pat Wood III, chair of the Texas Public Utility Commission. Wood stated that the primary cause of the power shortages in California is the state's generation capacity has remained flat, with only two new power plants built since 1995, while the population has increased and its economy has boomed. By contrast, Texas' market and regulatory climate have spurred the building of generation plants in Texas. Since 1995, 22 new power plants have come on-line in Texas, with another 15 plants under construction. The plants should be ready by the time the Texas electric market opens to competition in January of 2002. In addition, 33 more Texas plants are in the planning stage.

The hearing continued with invited testimony regarding emissions and reliability. The first panel discussed regulatory issues. Panel members included Jeff Saitas representing the Texas Natural Resource Conservation Commission (TNRCC), Greg Cooke representing the Dallas office of the Environmental Protection Agency (EPA), Ned Meyer representing the North Carolina Air Quality Headquarters of the EPA, and Dr. Jim Lester of the Environmental Institute at the University of Houston. Saitas briefed the committee about the state's implementation plan for compliance of the Federal Clean Air Act as it affects electric restructuring, particularly relating to reductions that will be required by providers. Meyer explained the EPA model used for measuring air quality, including the variables used for specific geographic areas. Lester discussed environmental issues involved with the EPA model and meteorological issues that specifically affect the Houston area.

The second panel presented the industry perspective. Panelists included Ed Feith representing Reliant Energy, Steve Kean representing Enron, and George Beatly representing the Greater Houston Partnership. Reliability issues, emission standards, and the differences between the California and Texas plans were the topics of discussion.

The next hearing will be held on September 26, 2000 in Austin.

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