S.B. No. 2
 
 
 
 
AN ACT
  relating to the governance of the Public Utility Commission of
  Texas, the Office of Public Utility Counsel, and an independent
  organization certified to manage a power region.
         BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
         SECTION 1.  Subchapter B, Chapter 12, Utilities Code, is
  amended by adding Section 12.0521 to read as follows:
         Sec. 12.0521.  PRESIDING OFFICER QUALIFICATIONS. The
  commissioner designated as the presiding officer must be a resident
  of this state.
         SECTION 2.  Section 13.022(a), Utilities Code, is amended to
  read as follows:
         (a)  The counsellor must:
               (1)  be licensed to practice law in this state and a
  resident of this state;
               (2)  have demonstrated a strong commitment to and
  involvement in efforts to safeguard the rights of the public; and
               (3)  possess the knowledge and experience necessary to
  practice effectively in utility proceedings.
         SECTION 3.  Section 39.151, Utilities Code, is amended by
  amending Subsections (d), (g), and (g-1) and adding Subsections
  (g-2), (g-3), (g-4), (g-5), and (g-6) to read as follows:
         (d)  The commission shall adopt and enforce rules relating to
  the reliability of the regional electrical network and accounting
  for the production and delivery of electricity among generators and
  all other market participants, or may delegate to an independent
  organization responsibilities for adopting [establishing] or
  enforcing such rules. Rules [Any such rules] adopted by an
  independent organization and [any] enforcement actions taken by the
  organization under delegated authority from the commission are
  subject to commission oversight and review and may not take effect
  before receiving commission approval. An independent organization
  certified by the commission is directly responsible and accountable
  to the commission. The commission has complete authority to
  oversee and investigate the organization's finances, budget, and
  operations as necessary to ensure the organization's
  accountability and to ensure that the organization adequately
  performs the organization's functions and duties. The organization
  shall fully cooperate with the commission in the commission's
  oversight and investigatory functions. The commission may take
  appropriate action against an organization that does not adequately
  perform the organization's functions or duties or does not comply
  with this section, including decertifying the organization or
  assessing an administrative penalty against the organization. The
  commission by rule shall adopt procedures governing
  decertification of an independent organization, selecting and
  certifying a successor organization, and transferring assets to the
  successor organization to ensure continuity of operations in the
  region. The commission may not implement, by order or by rule, a
  requirement that is contrary to an applicable federal law or rule.
         (g)  To maintain certification as an independent
  organization for the ERCOT power region under this section, an
  organization's governing body must be composed of persons selected
  by the ERCOT board selection committee [specified by this section
  and selected in accordance with formal bylaws or protocols of the
  organization].
         (g-1)  The independent organization's bylaws or protocols
  must be approved by the commission and must reflect the input of the
  commission. [The bylaws must specify the process by which
  appropriate stakeholders elect members and, for unaffiliated
  members, prescribe professional qualifications for selection as a
  member.] The bylaws must require that every member of the governing
  body be a resident of this state and must prohibit a legislator from
  serving as a member [the use of a professional search firm to
  identify candidates for membership of unaffiliated members. The
  process must allow for commission input in identifying candidates].
  The governing body must be composed of:
               (1)  the chairman of the commission as an ex officio
  nonvoting member;
               (2)  the counsellor as an ex officio voting member
  representing residential and small commercial consumer interests;
               (3)  the chief executive officer of the independent
  organization as an ex officio nonvoting [voting] member; and
               (4)  eight members selected by the selection committee
  under Section 39.1513 with executive-level experience in any of the
  following professions:
                     (A)  finance;
                     (B)  business;
                     (C)  engineering, including electrical
  engineering;
                     (D)  trading;
                     (E)  risk management;
                     (F)  law; or
                     (G)  electric market design [six market
  participants elected by their respective market segments to serve
  one-year terms, with:
                     [(A)  one representing independent generators;
                     [(B)  one representing investor-owned utilities;
                     [(C)  one representing power marketers;
                     [(D)  one representing retail electric providers;
                     [(E)  one representing municipally owned
  utilities; and
                     [(F)  one representing electric cooperatives;
               [(5)  one member representing industrial consumer
  interests and elected by the industrial consumer market segment to
  serve a one-year term;
               [(6)  one member representing large commercial
  consumer interests selected in accordance with the bylaws to serve
  a one-year term; and
               [(7)  five members unaffiliated with any market segment
  and selected by the other members of the governing body to serve
  three-year terms].
         (g-2)  Members [(g-1) The presiding officer] of the
  governing body are entitled to receive a salary for their service
  [must be one of the members described by Subsection (g)(7)].
         (g-3)  A person does not qualify for selection as a member of
  the governing body of an independent organization for the ERCOT
  power region if the person has a fiduciary duty or assets in the
  electricity market for that region.
         (g-4)  To maintain certification as an independent
  organization under this section, the organization's governing body
  may not include more than two members who are employed by an
  institution of higher education, as defined by Section 61.003,
  Education Code, in a professorial role.
         (g-5)  A former member of the governing body of an
  independent organization certified under this section may not,
  before the second anniversary of the date the member ceases to be a
  member of the governing body, engage in an activity that requires
  registration under Chapter 305, Government Code.
         (g-6)  To maintain certification as an independent
  organization under this section, the organization's governing body
  must establish and implement a formal process for adopting new
  protocols or revisions to existing protocols. The process must
  require that new or revised protocols may not take effect until the
  commission approves a market impact statement describing the new or
  revised protocols.
         SECTION 4.  Subchapter D, Chapter 39, Utilities Code, is
  amended by adding Section 39.1513 to read as follows:
         Sec. 39.1513.  ERCOT BOARD SELECTION COMMITTEE. (a) The
  ERCOT board selection committee is composed of:
               (1)  one member appointed by the governor;
               (2)  one member appointed by the lieutenant governor;
  and
               (3)  one member appointed by the speaker of the house of
  representatives.
         (b)  A person may not be appointed as a member of the
  committee unless the person is a resident of this state.
         (c)  A member of the committee is not entitled to
  compensation for serving as a member but is entitled to
  reimbursement for actual and necessary expenses incurred in
  performing the official duties of office.
         (d)  The committee shall select members eligible under
  Section 39.151 to serve on the governing body of an independent
  organization certified under that section for the ERCOT power
  region and shall designate the chair and vice chair of the governing
  body from those members.
         (e)  The ERCOT board selection committee shall retain an
  outside consulting firm to help select members of the governing
  body under Subsection (d).
         SECTION 5.  An independent organization certified under
  Section 39.151, Utilities Code, by the Public Utility Commission of
  Texas before September 1, 2021, shall modify the organization to
  comply with Section 39.151, Utilities Code, as amended by this Act.
  After September 1, 2021, the Public Utility Commission of Texas may
  decertify an independent organization that does not comply with
  Section 39.151, Utilities Code, as amended by this Act.
         SECTION 6.  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, 2021.
 
 
 
 
 
 
  ______________________________ ______________________________
     President of the Senate Speaker of the House     
 
         I hereby certify that S.B. No. 2 passed the Senate on               
  April 14, 2021, by the following vote:  Yeas 30, Nays 1;              
  May 27, 2021, Senate refused to concur in House amendments and
  requested appointment of Conference Committee; May 28, 2021, House
  granted request of the Senate; May 30, 2021, Senate adopted
  Conference Committee Report by the following vote:  Yeas 27,
  Nays 4.
 
 
  ______________________________
  Secretary of the Senate    
 
         I hereby certify that S.B. No. 2 passed the House, with
  amendments, on May 24, 2021, by the following vote:  Yeas 142,
  Nays 1, one present not voting; May 28, 2021, House granted request
  of the Senate for appointment of Conference Committee;               
  May 30, 2021, House adopted Conference Committee Report by the
  following vote:  Yeas 132, Nays 5, two present not voting.
 
 
  ______________________________
  Chief Clerk of the House   
 
 
 
  Approved:
 
  ______________________________ 
             Date
 
 
  ______________________________ 
            Governor