16 Tex. Admin. Code § 25.342 - Electric Business Separation
(a)
Purpose. The purpose of this section is to identify the competitive electric
industry business activities that must be separated from the regulated
transmission and distribution utility and performed by a power generation
company (PGC), a retail electric provider (REP), or some other business unit
pursuant to the Public Utility Regulatory Act (PURA) §39.051. This section
establishes procedures for the separation of such business
activities.
(b) Application. This
section shall apply to electric utilities, as defined in §
25.5 of this title (relating to
Definitions).
(c) Compliance and
timing.
(1) The commission shall prescribe a
schedule for the filing of a business separation plan prior to the introduction
of customer choice for an electric utility that is subject to PURA
§39.102(c) or §39.402. Pursuant to such schedule, an affected
electric utility shall separate from its regulated utility activities its
customer energy services business activities and shall separate its business
activities in accordance with subsection (d) of this section.
(2) Upon review of the filing, the commission
shall adopt the electric utility's plan for business separation, adopt the plan
with changes, or reject the plan and require the electric utility to file a new
plan.
(d) Business
separation.
(1) An electric utility may not
offer competitive energy services; however, an electric utility may petition
the commission pursuant to §
25.343(d) of
this title (relating to Competitive Energy Services) for authority to provide
to its Texas customers or some subset of its customers any service otherwise
identified as a competitive energy service.
(2) Each electric utility shall separate its
business activities and related costs into the following units: power
generation company; retail electric provider; and transmission and distribution
utility company. An electric utility may accomplish this separation either
through the creation of separate nonaffiliated companies or separate affiliated
companies owned by a common holding company or through the sale of assets to a
third party. An electric utility may create separate transmission utility and
distribution utility companies.
(3)
Each electric utility, subject to PURA §39.157(d), shall comply with this
section in a manner that provides for a separation of personnel, information
flow, functions, and operations, consistent with PURA §39.157(d) and
§
25.272 of this title (relating to
Code of Conduct for Electric Utilities and Their Affiliates).
(4) All transfers of assets and liabilities
to separate affiliated or nonaffiliated companies, a power generation company,
retail electric provider, or a transmission and distribution utility company
during the initial business separation process shall be recorded at book
value.
(5) The commission, in
approving a plan under subsection (c) of this section, may prescribe dates for
the discontinuation of competitive energy services and the separation of
business activities.
(e)
Business separation plans. Each electric utility subject to PURA
§39.051(e) that has not separated its business functions shall file a
business separation plan with the commission according to a commission-approved
Business Separation Plan Filing Package (BSP-FP) on a date prescribed by the
commission. An electric utility for which the commission has previously
approved a business separation plan is not required to file an additional plan
under this section. If necessary, however, the commission may require such
electric utility to file updated information or modifications to its existing
business separation plan.
(1) The business
separation plan shall include, but shall not be limited to, the following:
(A) A description of the financial and legal
aspects of the business separation, the functional and operational separations,
physical separation, information systems separation, asset transfers during the
initial unbundling, separation of books and records, and compliance with §
25.272 of this title both during
and after the transition period.
(B) A description of all services provided by
the corporate support services company, as well as any corporate support
services provided by another separate affiliate including pricing
methodologies.
(C) A proposed
internal code of conduct that addresses the requirements in §
25.272 of this title and the
spirit and intent of PURA §39.157. The internal code of conduct shall
address each provision of §
25.272 of this title, and shall
provide detailed rules and procedures, including employee training,
enforcement, and provisions for penalties for violations of the internal code
of conduct.
(D) A description of
each competitive energy service provided within Texas by the electric utility,
including a detailed plan for completely and fully separating these competitive
energy services, as set forth in §
25.343 of this title.
(E) Descriptions of all system services,
discretionary services, and other services pursuant to subsection (f) of this
section to be provided within Texas by the transmission and distribution
utility.
(2) To the
extent that not all of the detailed information required to be filed on the
date prescribed by the commission is available, the electric utility shall
provide a firm schedule for supplemental filings. The commission shall approve
only portions of the business separation plan for which complete information is
provided.
(f) Separation
of transmission and distribution utility services.
(1) Classification of services. Each service
offered, or potentially offered, by a transmission and distribution utility
shall be classified as one of the following:
(A) System service. The costs associated with
providing system service are system-wide costs that are borne by the retail
electric provider serving all transmission and distribution
customers.
(B) Discretionary
service.
(i) The cost associated with each
discretionary service is customer-specific and should be borne only by the
retail electric provider serving the transmission and distribution customer who
purchases the discretionary service.
(ii) Each discretionary service shall be
provided by the transmission and distribution utility on a nondiscriminatory
basis pursuant to a commission-approved embedded cost-based tariff.
(iii) The costs associated with providing
discretionary services are tracked separately from costs associated with
providing system services.
(iv) A
discretionary service is not a competitive energy service as defined by §
25.341 of this title (relating to
Definitions).
(C)
Petitioned service. Service in which a petition to provide a specific
competitive energy service has been granted by the commission pursuant to
§
25.343(d)(1) of
this title.
(D) Other service.
(i) The offering of any other services shall
be limited to those services which:
(I)
maximize the value of transmission and distribution system service facilities;
and
(II) are provided without
additional personnel and facilities other than those essential to the provision
of transmission and distribution system services.
(ii) If the transmission and distribution
utility offers a service under clause (i) of this subparagraph, the
transmission and distribution utility shall:
(I) track revenues and to the extent possible
the costs for each service separately;
(II) offer the service on a
non-discriminatory-basis, and if the commission determines that it is
appropriate, pursuant to a commission-approved tariff, and;
(III) credit all revenues received from the
offering of this service during the test year after known and measurable
adjustments are made to lower the revenue requirement of the transmission and
distribution utility on which the rates are based.
Notes
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