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May 23, 2019

Bill on utility batteries stalls; another signed into law

by Wendell Bell
Source – Grid Monitor
Posted 05/23/2019

One bill designed to clarify which entities in the electric utility industry may deploy energy storage equipment appears dead after a key deadline passed for its consideration.  A more limited bill on the subject has been signed into law.

Senate Bill 1941, authored by Sen. Kelly Hancock (R-North Richland Hills) and sponsored in the House by Rep. Justin Holland (R-Rockwall), was scheduled for debate on the last day for the House to consider Senate bills on second reading, but it was too far down the agenda to come up before midnight Tuesday.

The bill addressed a recommendation from the Public Utility Commission’s biennial Scope of Competition Report for guidance regarding the ownership and use of utility-scale batteries in the ERCOT region since the vertically integrated utilities were unbundled into generation, transmission and distribution, and retail segments. 

Key provisions in the bill would allow a transmission and distribution utility (TDU), with PUC approval, to contract with a power generation company (PGC) to provide energy to meet the TDU’s reliability needs.  The TDU would have to demonstrate that the storage project would be more cost-effective than construction of traditional distribution facilities in order for the PUC to allow recovery of reasonable and necessary costs in the TDU’s rates.  

While it is possible for dead bills to be resurrected as amendments to other bills, opportunities to find relevant legislation still in play appear to be slight.

A separate measure dealing with utility scale battery usage by electric cooperatives and municipally owned utilities has been signed into law by Governor Greg Abbott.  Senate Bill 1012 by Sen. Judith Zaffirini (D-Laredo) implements another PUC recommendation to clarify that such entities do not have to register as PGCs in order to deploy storage projects.  Described as a code cleanup bill, it passed the Senate unanimously on April 4 and passed on the House Local and Consent Calendar on May 3.

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