84R9496 JXC-F
	By: Fraser	S.B. No. 931

	A BILL TO BE ENTITLED
	AN ACT
	relating to the goal for renewable energy and competitive renewable
	energy zones.
	BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
	SECTION 1.  Section 39.904, Utilities Code, is amended by
	amending Subsections (a), (b), (c), (h), (j), and (o) and adding
	Subsection (h-1) to read as follows:
	(a) It is the intent of the legislature that by January 1,
	2015, an additional 5,000 megawatts of generating capacity from
	renewable energy technologies will have been installed in this
	state.  The cumulative installed renewable capacity in this state
	shall total 5,880 megawatts by January 1, 2015, and the commission
	shall establish a target of 10,000 megawatts of installed renewable
	capacity by January 1, 2025.  The cumulative installed renewable
	capacity in this state shall total 2,280 megawatts by January 1,
	2007, 3,272 megawatts by January 1, 2009, 4,264 megawatts by
	January 1, 2011, 5,256 megawatts by January 1, 2013, and 5,880
	megawatts by January 1, 2015.  Of the renewable energy technology
	generating capacity installed to meet the goal of this subsection
	after September 1, 2005, the commission shall establish a target of
	having at least 500 megawatts of capacity from a renewable energy
	technology other than a source using wind energy.  The goal and
	targets established under this subsection terminate on December 31,
	2015.
	(b)  The commission shall establish a renewable energy
	credits trading program. Before December 31, 2015, a [Any] retail
	electric provider, municipally owned utility, or electric
	cooperative that does not satisfy the requirements of Subsection
	(a) by directly owning or purchasing capacity using renewable
	energy technologies shall purchase sufficient renewable energy
	credits to satisfy the requirements by holding renewable energy
	credits in lieu of capacity from renewable energy technologies. On
	or after December 31, 2015, a retail electric provider shall
	purchase sufficient renewable energy credits to verify any
	marketing claims the provider makes related to the content of
	renewable energy, as determined by the commission.
	(c)  Not later than January 1, 2000, the commission shall
	adopt rules necessary to administer and enforce this section. At a
	minimum, the rules shall:
	(1)  establish the minimum annual renewable energy
	requirement for each retail electric provider, municipally owned
	utility, and electric cooperative operating in this state in a
	manner reasonably calculated by the commission to produce, on a
	statewide basis, compliance with the requirement prescribed by
	Subsection (a); and
	(2)  specify reasonable performance standards that all
	renewable capacity additions must meet to earn renewable energy
	credits [count against the requirement prescribed by Subsection
	(a)] and that:
	(A)  are designed and operated so as to maximize
	the energy output from the capacity additions in accordance with
	then-current industry standards; and
	(B)  encourage the development, construction, and
	operation of new renewable energy projects at those sites in this
	state that have the greatest economic potential for capture and
	development of this state's environmentally beneficial renewable
	resources.
	(h)  The commission, in consultation with the independent
	organization certified for ERCOT, shall plan for transmission needs
	related to the incorporation of renewable energy in a manner
	consistent with the planning process for other types of generation
	resources, including by considering in the planning process [In
	considering an application for a certificate of public convenience
	and necessity for a transmission project intended to serve a
	competitive renewable energy zone, the commission is not required
	to consider] the factors provided by Section 37.056 [Sections
	37.056(c)(1) and (2)].
	(h-1)  The commission may not designate a new competitive
	renewable energy zone after January 1, 2015.
	(j)  The commission, after consultation with each
	appropriate independent organization, electric reliability
	council, or regional transmission organization, shall file a report
	with the legislature not later than December 31 of each
	even-numbered year.  The report must include[:
	[(1)     an evaluation of the commission's implementation
	of competitive renewable energy zones;
	[(2)     the estimated cost of transmission service
	improvements needed for each competitive renewable energy zone; and
	[(3)]  an evaluation of the effects that additional
	renewable generation has on system reliability and on the cost of
	alternatives to mitigate the effects.
	(o)  The commission may establish an alternative compliance
	payment to meet the goal established by Subsection (a) before its
	termination.  An entity that has a renewable energy purchase
	requirement under this section may elect to pay the alternative
	compliance payment instead of applying renewable energy credits
	toward the satisfaction of the entity's obligation under this
	section.  The commission may establish a separate alternative
	compliance payment for the goal of 500 megawatts of capacity from
	renewable energy technologies other than wind energy that an entity
	may use until January 1, 2016, to meet that goal.  The alternative
	compliance payment for a renewable energy purchase requirement that
	could be satisfied with a renewable energy credit from wind energy
	may not be less than $2.50 per credit or greater than $20 per
	credit.  Prior to September 1, 2009, an alternative compliance
	payment under this subsection may not be set above $5 per credit.
	In implementing this subsection, the commission shall consider:
	(1)  the effect of renewable energy credit prices on
	retail competition;
	(2)  the effect of renewable energy credit prices on
	electric rates;
	(3)  the effect of the alternative compliance payment
	level on the renewable energy credit market; and
	(4)  any other factors necessary to ensure the
	continued development of the renewable energy industry in this
	state while protecting ratepayers from unnecessary rate increases.
	SECTION 2.  The recovery of a transmission facility
	investment made by an electric utility to serve a competitive
	renewable energy zone is governed by the law in effect on the date
	the facility is placed in service, regardless of whether the
	facility is completed before, on, or after the effective date of
	this Act, and that law is continued in effect for that purpose.
	SECTION 3.  This Act takes effect immediately if it receives
	a vote of two-thirds of all the members elected to each house, as
	provided by Section 39, Article III, Texas Constitution.  If this
	Act does not receive the vote necessary for immediate effect, this
	Act takes effect September 1, 2015.