HBA-ALS H.B. 3187 76(R) BILL ANALYSIS Office of House Bill AnalysisH.B. 3187 By: Longoria State Affairs 3/31/1999 Introduced BACKGROUND AND PURPOSE Currently, there is no statutory provision specifically requiring or encouraging the Public Utility of Texas (commission) to promote energy efficiency. There is concern that in the absence of such a provision, utilities may not sufficiently focus on energy efficiency during the proposed restructuring of the utility industry in Texas. H.B. 3187 sets forth legislative intent relating to the role of utilities in the administration and funding of energy efficiency-related customer programs. Specifically, this bill establishes that it is the legislature's intent that: utilities administer information and energy savings incentive programs for customers; customers have access to energy efficiency alternatives; utilities may offer low-interest loans and grants for energy efficient investments and programs; and that utilities reach a higher energy efficiency through these customer-related programs. RULEMAKING AUTHORITY It is the opinion of the Office of House Bill Analysis that rulemaking authority is expressly delegated to the Public Utility Commission of Texas in SECTION 2 of this bill. SECTION BY SECTION ANALYSIS SECTION 1. Amends Section 36.204, Subtitle B, Title 2, Utilities Code, as follows: Sec. 36.204. COST RECOVERY AND INCENTIVES. Authorizes the Public Utility Commission of Texas (commission), in establishing rates for an electric utility, rather than in establishing rates for an electric utility not required to file an integrated resource plan, to perform specified acts. Provides that it is the intent of the legislature that: _ utilities administer customer information and energy savings incentive programs in a market-neutral, nondiscriminatory manner; _ all customers have a choice of and access to energy efficiency alternatives and other choices that allow a customer to reduce energy consumption and reduce energy costs, as well as an open choice of provider; _ utilities may offer loans at below market interest rates for energy efficiency investments, other energy efficiency transformation programs which result in below market cost, grants, and other programs to address the needs of small businesses, tenants, low-income consumers, and other customer groups not served by market-based incentive programs; and _ utilities be required to acquire through market-based standard offer programs or targeted market transformation programs, additional energy efficiency, equivalent to at least 25 percent of each year's growth in demand. Redesignates existing Subsections (1) and (2) to Subsections (1)(a) and (1)(b), respectively. SECTION 2. Requires the commission to establish rules necessary to carry out and oversee the implementation of the provisions of Section 1 of this Act. SECTION 3.Effective date: September 1, 1999. SECTION 4.Emergency clause.