Senate Interim Committee on Electric Utility Restructuring
Last Updates on January 18, 1999

Chair:

Members:

Interim Committee Charges

  1. Study and determine any needed changes in the Public Utility Regulatory Act and related statutes to create a competitive Texas electric market that is open to all classes of retail customers. Such review shall include but not be limited to the following issues:
    1. an appropriate date for opening the market to direct end-use customer access, and whether a phase-in program for public schools or other governmental units is warranted;
    2. methods for quantification of a utility's investments that would be uneconomic in a fully competitive market (stranded costs) and appropriate methods for recovery of costs (including rate freezes, adjustments to depreciation, transition charges, securitization);
    3. balancing rate reductions with recovery of stranded costs during the transition to a competitive market;
    4. the basic structural requirements for the competitive market to serve as an effective and efficient replacement for traditional regulation;
    5. provisions for municipal and cooperative utilities recognizing the importance of maintaining local control of community-owned systems and protecting the financial integrity of cooperative and municipal utilities;
    6. safeguards necessary for customer protection in a fully competitive marketplace (including designation of a provider of last resort, protections for low-income customers, obligations to be imposed on all providers, ability of providers to serve customers on an aggregated basis, and fair marketing and sales practices);
    7. system reliability and service quality standards needed to ensure safe and reliable power and the role of the independent system operator in a fully competitive market;
    8. environmental issues relating to a competitive marketplace;
    9. development of renewable energy resources such as windpower in a competitive marketplace; and
    10. scope and nature of the continuing role of regulation in a deregulated electric power industry including oversight of market power.
  2. Make recommendations for legislative and regulatory action, if necessary.

The electric utility charge was issued on August 13, 1997.

The committee's final report is due October 1, 1998.

Interim Committee Report (PDF Format)

Hearing Information

Stranded Investment Treatment
May 28, 1998 in Victoria
Victoria College, Johnson Symposium Center

2. Methods for quantification of a utility's investments that would be uneconomic in a fully competitive market (stranded costs) and appropriate methods for recovery of costs (including rate freezes, adjustments to depreciation, transition charges, securitization)

3. Balancing rate reductions with recovery of stranded costs during the transition to a competitive market

Reliability and Retail Access
September 29, 1998
College Station, Presidential Conference Center at A&M University in College Station.

7. System reliability and service quality standards needed to ensure safe and reliable power and the role of the independent system operator in a fully competitive market

1. An appropriate date for opening the market to direct end-use customer access, and whether a phase-in program for public schools or other governmental units is warranted

The rest of the schedule

Status Report

Summary:

The Committee is soliciting extensive public testimony from interested parties on the feasibility of opening the Texas electric market to retail competition. The ten issues identified by the interim charge have been segmented into five separate hearings, as identified in the summary of meetings that follows. Each of the meetings contains panel discussions from invited experts followed by public testimony.

In addition to the public hearing process, the Committee has formally requested studies by the following state agencies, due July 1, 1998, unless otherwise noted:

Public Utility Commission:

Texas Energy Coordination Council:

Several members of the Committee also participated in interviews with members of the California Legislature, California Public Utility Commission, California Independent System Operator, and other interested parties involved in the restructuring of the California electric market. The Committee and staff continue to monitor retail competition outside of Texas as a means to understanding the critical issues involved.

Public Participation:

Significant public participation has resulted in comprehensive levels of information for the Committee's analysis. Most of the Committee's testimony has come from organized interested parties, including consumer representatives.

The Committee has received extensive cooperation and support from the Public Utility Commission and the Office of Public Utility Counsel.

Meeting Schedule:

September 26, 1997
AUSTIN -- Organizational Meeting

December 12, 1997
AMARILLO -- Market Structure and Performance

February 4, 1998
AUSTIN -- System Benefits

March 25, 1998
GRAPEVINE -- Public Power and Cooperatives

Early June
VICTORIA -- Stranded Investment Treatment

September 29
COLLEGE STATION -- Reliability, Retail Access and other issues

September
AUSTIN -- work sessions as necessary to finalize report

Estimated Completion Date:

The Committee expects to deliver to the Lt. Governor a final copy of its findings on or before October 1, 1998.

Related Links

Public Utility Commission

The National Council on Competition and the Electric Industry

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