Update on the 87th Texas Legislature

The 87th Session of the Texas Legislature remains less than a month old, and already lawmakers have filed more than 1,900 bills and resolutions. Lawmakers also have taken up important logistical business, including the election of a new House Speaker, Rep. Dade Phelan, of Beaumont. Mr. Phelan replaces former Speaker Dennis Bonnen, who chose not to see re-election last year. Meanwhile in the Senate, members have adopted a rule change that will allow bills to come to the floor with 18 votes, as opposed to the previously required supermajority of 19 votes. The change will preserve the ability of Republican Senators, who are in the majority in the upper chamber, to bring forth legislation without support from Democrats.

In other news, Lt. Gov. Dan Patrick, who leads the Texas Senate, has announced committee assignments. Two Senate committees on our watch list are the Business and Commerce Committee and the Natural Resource and Economic Development Committee. They will be chaired by Sens. Kelly Hancock and Brian Birdwell, respectively. Speaker Phelan has yet to announce Committee assignments in the Texas House, but is expected to do so by mid-February.

Although the session remains young, three issues already have emerged as top priorities: the budget, redistricting and the pandemic. Lawmakers also have filed dozens of energy and utility related bills. We describe several of them below, and explain briefly their purpose. Keep in mind that inclusion on this list does not imply our support or opposition. We summarize these bills for informational purposes only.

Senate Bill 182, by state Sen. Charles Schwertner, requires the Public Utility Commission to conduct a five-year look-back analysis of rates charged by municipal electric utilities. If the municipal rates are 10 percent higher than the five-year average of competitive rates paid in a similarly situated area with electric competition, then the municipal utility must transition to deregulation within one year.

Senate Bill 243, by state Sen. Sarah Eckhardt, calls for an increase in energy efficiency goals for utilities.

Senate Bill 304, also by Sen. Eckhardt, calls for an increase in zero-carbon energy from retail electric providers, municipally owned utilities and electric cooperatives. It also directs the Public Utility Commission to create a trading program for zero-carbon energy.

Senate Bill 398, by state Sen. Jose Menendez, has two sections. The first lays out various disclosure requirements for the installation of distributed generation. The second holds that municipal governments cannot restrict the installation of solar installations by a residential or small commercial customer except under certain circumstances.

Senate Bill 415, by state Sen. Kelly Hancock, would allow transmission and distribution utilities to contract with generation companies for battery storage services. The services would be for reliability purposes only. The legislation bars T&D utilities from owning battery storage on their own. The legislation is nearly identical to a House Committee substitute version of SB 1941, from the 2019 legislative session.

House Bill 1042, by state Rep. Rafael Anchia, would change the name of the Railroad Commission of Texas to the Texas Energy Resources Commission. This is a refiled bill from the 2019 session.

House Bill 427, by state Rep. Ken King, would impose an additional $200 fee for the registration of electric vehicles as well as a $100 fee for the registration of hybrid vehicles.

House Bill 433, also by state Rep. King, would impose a 1-cent per-kilowatt-hour tax on each kilowatt of electricity generated in Texas from any source other than natural gas.

House Bill 1284, by state Rep. Chris Paddie, transfers regulatory responsibilities relating to carbon dioxide sequestration from the Texas Commission on Environmental Quality to the Texas Railroad Commission, and makes other related adjustments to law.