When it comes to paying for expensive legislative lobbyists, four of the top five biggest spenders during the most recent legislative session were electric companies. That’s the word from Texans for Public Justice, a campaign watchdog group, which also reported this week that the energy and waste sector was by far the most lavish of the state’s lobby spenders during the 83rd Regular Session.
Collectively, four electric companies — Energy Future Holdings, American Electric Power, Oncor Electric Delivery and CenterPoint Energy — spent up to $8.6 million on lobby contracts, the group reported. The nearly bankrupt Energy Future Holdings and its individual business units spent up to $6.2 million on 158 lobby contracts.
With so much firepower, it was inevitable that much of the legislation backed by the electric industry would win passage. Among the biggest gifts to the state’s monopoly utilities was Senate Bill 1364, which will limit the Public Utility Commission’s discretion over how much electric utilities charge their customers for federal corporate income taxes. SB 1364 was opposed by municipal coalitions and consumer advocates because it will inevitably lead to higher rates.
Electric industry lobbyists also successfully opposed legislation that would create standard-offer products for electricity shoppers. This legislation would have brought more choices and more transparency to the electricity market. Legislation reauthorizing and reforming the Texas Railroad Commission — including changing the misleading name of the agency — also failed to win passage.
But despite the well-funded opposition, energy consumers won several victories. For instance, a bill to reauthorize operations at the PUC included several reforms to help protect the power grid. Also, several bills that would have been extremely harmful to the interests of municipal, business and residential energy consumers died, and lawmakers expressed support for further study of a multi-billion-dollar market change currently under consideration by the PUC.
Here are a few highlights from the recently adjourned regular session:
• Electric and gas utilities pressed unsuccessfully for the passage of House Bills 1148 and 1149, which would have made it more difficult for cities to protect their citizens in utility rate cases. City officials, including — many officials from the Texas Coalition for Affordable Power and municipal coalitions — opposed these bills.
• The Texas Legislature adopted House Bill 1600, which reauthorizes operations at the Public Utility Commission. HB 1600 includes a handful of new reforms, including rules giving the PUC additional oversight authority to protect the electric power grid. Unfortunately, lawmakers removed an amendment that would have directed the PUC to conduct a cost-benefit analysis before authorizing an expensive “capacity market” that could add more than a billion dollars annually to electric bills. Lawmakers did, however, express their intent on the floors of both chambers that the PUC should conduct such a study. The Texas Coalition for Affordable Power is a strong advocate for such a cost-benefit review and also supported adoption of HB 1600.
• House Bill 7 includes language to wind down the System Benefit Fund, which was created in 1999 as part of the electric deregulation law to fund rate discounts for low-income customers. However, the Texas Legislature has raided the System Benefit Fund in recent years to balance the state budget. Under HB 7, low income customers will receive a significant rebate on electric bills before the SBF is discontinued in 2017.
• Less fortunate for energy consumers was the failure of HB 2166 — the Railroad Commission “Sunset” bill. This legislation included a handful of significant reforms, including a provision that would have changed the misleading name of this natural gas regulatory agency.
TCAP is a coalition of more than 160 cities and other political subdivisions that purchase electricity in the deregulated market for their own governmental use. Because high energy costs can impact municipal budgets and the ability to fund essential services, TCAP, as part of its mission, actively promotes affordable energy policies. High energy prices also place a burden on local businesses and residences.