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AN ACT
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relating to the Public Utility Commission of Texas' authority to |
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disgorge revenue obtained as a result of certain violations; |
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providing an administrative penalty. |
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BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS: |
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SECTION 1. The heading to Section 15.023, Utilities Code, |
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is amended to read as follows: |
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Sec. 15.023. ADMINISTRATIVE PENALTY, DISGORGEMENT ORDER, |
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OR MITIGATION PLAN. |
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SECTION 2. Section 15.023, Utilities Code, is amended by |
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adding Subsections (e), (f), and (g) to read as follows: |
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(e) For a violation of Section 39.157, the commission shall, |
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in addition to the assessment of a penalty, order disgorgement of |
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all excess revenue resulting from the violation. For any other |
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violation of the statutes, rules, or protocols relating to |
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wholesale electric markets, the commission may, in addition to the |
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assessment of a penalty, order disgorgement of all excess revenue |
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resulting from the violation. |
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(f) The commission and a person may develop and enter into a |
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voluntary mitigation plan relating to a violation of Section 39.157 |
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or rules adopted by the commission under that section. If the |
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commission and a person enter into a voluntary mitigation plan, |
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adherence to the plan constitutes an absolute defense against an |
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alleged violation with respect to activities covered by the plan. |
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(g) In this subchapter, "excess revenue" means revenue in |
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excess of revenue that would have occurred absent a violation. |
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SECTION 3. The heading to Section 15.024, Utilities Code, |
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is amended to read as follows: |
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Sec. 15.024. ADMINISTRATIVE PENALTY ASSESSMENT OR |
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DISGORGEMENT ORDER PROCEDURE. |
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SECTION 4. Section 15.024(f), Utilities Code, is amended to |
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read as follows: |
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(f) If the person requests a hearing or fails to timely |
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respond to the notice, the executive director shall set a hearing |
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and give notice of the hearing to the person. The parties to a |
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proceeding under this subchapter shall be limited to the person and |
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the commission, including the independent market monitor. The |
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hearing shall be held by an administrative law judge of the State |
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Office of Administrative Hearings. The administrative law judge |
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shall make findings of fact and conclusions of law and promptly |
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issue to the commission a proposal for a decision about the |
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occurrence of the violation and the amount of a proposed penalty. |
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Based on the findings of fact, conclusions of law, and proposal for |
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a decision, the commission by order may find that a violation has |
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occurred and impose a penalty or disgorgement order or may find that |
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no violation occurred. |
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SECTION 5. Section 15.025, Utilities Code, is amended by |
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adding Subsections (e) and (f) to read as follows: |
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(e) Any excess revenue ordered disgorged under this section |
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for a violation of the statutes, rules, or protocols relating to |
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wholesale electric markets shall be returned to the affected |
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wholesale electric market participants to be used to reduce costs |
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or fees incurred by retail electric customers. The commission |
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shall adopt rules to prescribe how revenue shall be returned to the |
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affected wholesale electric market participants under this |
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subsection. |
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(f) For purposes of this section and Section 15.026, a |
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reference to a penalty shall be construed to include disgorgement. |
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SECTION 6. Sections 15.026(a) and (b), Utilities Code, are |
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amended to read as follows: |
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(a) Judicial review of a commission order imposing an |
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administrative penalty or disgorgement is: |
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(1) instituted by filing a petition as provided by |
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Subchapter G, Chapter 2001, Government Code; and |
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(2) under the substantial evidence rule. |
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(b) If the court sustains the occurrence of the violation, |
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the court may uphold or reduce the amount of the penalty or |
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disgorgement and order the person to pay the full or reduced amount |
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of the penalty or disgorgement. If the court does not sustain the |
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occurrence of the violation, the court shall order that no penalty |
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or disgorgement is owed. |
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SECTION 7. Section 39.157(a), Utilities Code, is amended to |
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read as follows: |
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(a) The commission shall monitor market power associated |
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with the generation, transmission, distribution, and sale of |
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electricity in this state. On a finding that market power abuses or |
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other violations of this section are occurring, the commission |
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shall require reasonable mitigation of the market power by ordering |
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the construction of additional transmission or distribution |
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facilities, by seeking an injunction or civil penalties as |
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necessary to eliminate or to remedy the market power abuse or |
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violation as authorized by Chapter 15, by imposing an |
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administrative penalty as authorized by Chapter 15, by ordering the |
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disgorgement of excess revenue as authorized by Chapter 15, or by |
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suspending, revoking, or amending a certificate or registration as |
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authorized by Section 39.356. Section 15.024(c) does not apply to |
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an administrative penalty imposed under this section. For purposes |
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of this subchapter, market power abuses are practices by persons |
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possessing market power that are unreasonably discriminatory or |
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tend to unreasonably restrict, impair, or reduce the level of |
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competition, including practices that tie unregulated products or |
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services to regulated products or services or unreasonably |
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discriminate in the provision of regulated services. For purposes |
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of this section, "market power abuses" include predatory pricing, |
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withholding of production, precluding entry, and collusion. A |
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violation of the code of conduct provided by Subsection (d) that |
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materially impairs the ability of a person to compete in a |
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competitive market shall be deemed to be an abuse of market power. |
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The possession of a high market share in a market open to |
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competition may not, of itself, be deemed to be an abuse of market |
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power; however, this sentence shall not affect the application of |
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state and federal antitrust laws. |
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SECTION 8. The changes in law made by this Act apply only to |
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a violation that occurs on or after the effective date of this Act. |
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A violation that occurs before the effective date of this Act is |
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covered by the law in effect at the time the violation occurred, and |
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the former law is continued in effect for that purpose. |
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SECTION 9. This Act takes effect September 1, 2011. |
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______________________________ |
______________________________ |
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President of the Senate |
Speaker of the House |
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I certify that H.B. No. 2133 was passed by the House on April |
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27, 2011, by the following vote: Yeas 123, Nays 20, 1 present, not |
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voting. |
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______________________________ |
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Chief Clerk of the House |
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I certify that H.B. No. 2133 was passed by the Senate on May |
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25, 2011, by the following vote: Yeas 30, Nays 1. |
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______________________________ |
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Secretary of the Senate |
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APPROVED: _____________________ |
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Date |
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_____________________ |
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Governor |