16 Tex. Admin. Code § 25.362 - Electric Reliability Council of Texas (ERCOT) Governance
(a) Purpose.
This section provides standards for the governance of an independent
organization within the ERCOT region.
(b) Application. This section applies to
ERCOT or any other organization within the ERCOT region that qualifies as an
independent organization under PURA §39.151.
(c) Adoption of rules by ERCOT and commission
review. ERCOT shall adopt and comply with procedures concerning the adoption
and revision of ERCOT rules.
(1) The
procedures shall provide for advance notice to interested persons, an
opportunity to file written comments or participate in public discussions, and,
in the case of market protocols, operating guides, planning guides, and market
guides, an evaluation by ERCOT of the costs and benefits to the organization
and the operation of electricity markets.
(2) ERCOT staff, the independent market
monitor, and the commission's reliability monitor may comment on any proposed
change in ERCOT rules that affects the operation and competitiveness of markets
operated by ERCOT or reliability of the electric network in ERCOT.
(3) If the findings of a commission-mandated
audit of ERCOT operations or governance indicate the need for a change in
operating practices or procedures or governance rules, ERCOT shall develop and
submit to the commission a plan for implementing the changes. ERCOT shall
implement the plan, as approved by the commission. Commission-mandated audits,
as contemplated in PURA §39.151(d) and (d-1), shall be funded by ERCOT and
do not require approval by the governing board of ERCOT.
(4) The commission may review a provision of
ERCOT's articles of incorporation or by-laws, or a new or amended ERCOT rule on
the application of an interested person, including commission staff and the
Office of Public Utility Counsel.
(5) The commission shall process requests for
review of a provision of ERCOT's articles of incorporation or by-laws, a new or
amended ERCOT rule, or ERCOT decision in accordance with §
22.251 of this title (relating to
Review of Electric Reliability Council of Texas (ERCOT) Conduct). A request for
review under this subsection initiated by the commission, commission staff, or
the Office of Public Utility Counsel is not subject to the alternative dispute
resolution requirements in §
22.251(c) of
this title, which requires the use of Section 20 of the ERCOT Protocols
(Alternative Dispute Resolution Procedures), Section 21 of the Protocols
(Process for Protocol Revision), or other applicable ERCOT procedures. In
addition, the commission may, for good cause, waive the requirement that a
complaint be filed within the time prescribed in §
22.251(d) of
this title.
(d) Access
to meetings. ERCOT shall adopt and comply with procedures for providing access
to its meetings to market participants and the general public. These procedures
shall include provisions on advance notice of the time, place, and topics to be
discussed during open and closed portions of the meetings, and making and
retaining a record of the meetings. Records of meetings of the governing board
shall be retained permanently, and ERCOT shall establish reasonable retention
periods, but not less than five years, for records of other meetings.
(e) Access to information. This subsection
governs access to information held by ERCOT.
(1) ERCOT shall adopt and comply with
procedures that allow persons to request and obtain access to records that
ERCOT has or has access to relating to the governance and budget of the
organization, market operations, reliability, settlement, customer
registration, and access to the transmission system. ERCOT shall make these
procedures publicly available. Information that is available for public
disclosure pursuant to ERCOT procedures shall normally be provided within ten
business days of the receipt of a request for the information. If a response
requires more than ten business days, ERCOT shall notify the requester of the
expected delay and the anticipated date that the information may be available.
ERCOT's procedures regarding access to records shall be consistent with this
chapter and commission orders.
(A)
Information submitted to or collected by ERCOT pursuant to requirements of
ERCOT rules shall be protected from public disclosure only if it is designated
as Protected Information pursuant to ERCOT rules, except as otherwise provided
in this subsection.
(B) ERCOT shall
promptly respond to a request from the commission, a commissioner, a
commissioner's designee, the commission executive director, or the executive
director's designee for information that ERCOT collects, creates or maintains,
in order to provide the commission access to information that the commission, a
commissioner, a commissioner's designee, the executive director, or the
executive director's designee determines is necessary to carry out the
commission's responsibilities for oversight of ERCOT and the wholesale and
retail markets.
(C) In the absence
of a request for information under the Texas Public Information Act, Texas
Government Code Annotated, the commission staff may seek to release information
that the commission has in its possession or has access to that has been
designated as Protected Information under ERCOT rules, and the commission may
determine the validity of the asserted claim of confidentiality through a
contested-case proceeding. In a contested-case proceeding conducted by the
commission pursuant to this subsection, the staff, the entity that provided the
information to the commission, and ERCOT will have an opportunity to present
information or comment to the commission on whether the information is subject
to protection from disclosure under law.
(D) In connection with any challenge to the
confidentiality of information under subparagraph (C) of this paragraph, any
person who asserts a claim of confidentiality with respect to the information
must, at a minimum, state in writing the specific reasons why the information
is subject to protection from public disclosure and provide legal authority in
support of the assertion.
(2) Commission employees, consultants,
agents, and attorneys who have access to Protected Information pursuant to this
section shall not disclose such information except as provided in the Texas
Public Information Act.
(f) Conflicts of interest. ERCOT shall adopt
policies to ensure that its operations are not affected by conflicts of
interests relating to its employees' outside employment and financial interests
and its contractors' relationships with other businesses. These policies shall
include an obligation to protect confidential information obtained by virtue of
employment or a business relationship with ERCOT.
(g) Qualifications, selection, and removal of
members of the governing board. ERCOT shall establish and implement criteria
for an individual to serve as a member of its governing board, procedures to
determine whether an individual meets these criteria, and procedures for
removal of an individual from service if the individual ceases to meet the
criteria.
(1) The qualification criteria
shall include:
(A) Definitions of the market
sectors;
(B) Levels of activity in
the electricity business in the ERCOT region that an organization in a market
sector must meet, in order for a representative of the organization to serve as
a member of the governing board;
(C) Standards of good standing that an
organization must meet, in order for a representative of the organization to
serve as a member of the governing board; and
(D) Standards of good standing that an
individual must meet, in order for the individual to serve as a member of the
governing board.
(2) The
procedures for removal of a member from service on the governing board shall
include:
(A) Procedures for determining
whether an organization or individual meets the criteria adopted under
paragraph (1) of this subsection; and
(B) Procedures for the removal of an
individual from the governing board if the individual or the organization that
the individual represents no longer meets the criteria adopted under paragraph
(1) of this subsection or violates an ERCOT rule, including a written ERCOT
policy adopted under this section, or commission rule, or applicable
statute.
(3) The
procedures adopted under paragraph (2) of this subsection shall:
(A) Permit any interested party to present
information that relates to whether an individual or organization meets the
criteria specified in paragraph (1) of this subsection or has violated an ERCOT
rule, including a written ERCOT policy adopted under this section, or
commission rule, or applicable statute; and
(B) Specify how decisions concerning the
qualification of an individual or whether an individual has violated an ERCOT
rule or written ERCOT policy or procedure adopted under this section, or
commission rule, or applicable statute will be made.
(4) A decision concerning an individual or
organization's qualification or an individual's removal from the governing
board is subject to review by the commission.
(5) ERCOT shall notify the commissioners when
a vacancy occurs for an unaffiliated member of the governing board. ERCOT shall
provide information to the commissioners concerning the process for selecting a
new member, the candidates who have been identified and their qualifications,
any recommendation that will be made to the governing board, and any other
information requested by a commissioner. The selection of an unaffiliated
member of the governing board is subject to approval by the commission. A
person who is selected may not serve as a member of the governing board until
the commission approves the selection. An unaffiliated board member whose
three-year term has expired shall, if reappointed by the ERCOT governing board,
cease serving as a member of the governing board until the reappointment is
approved by the commission. The commission may remove an unaffiliated member of
the governing board for cause. Compensation, per diem and travel reimbursements
to be paid to unaffiliated members of the governing board shall be subject to
commission review and approval. As used in this paragraph, "cause" shall mean:
(A) a violation of a commission rule or
applicable statute, an ERCOT rule, or written ERCOT policy or procedure adopted
under this section;
(B) a director
is indicted or charged with a felony or is convicted of a misdemeanor involving
moral turpitude;
(C) conduct
inconsistent with a director's fiduciary duty to ERCOT or that may reflect
poorly upon the board or ERCOT; or
(D) a fundamental disagreement with the
commission as to the policies or procedures that ERCOT shall adopt, in each
case as determined by the commission at its sole discretion.
(6) A member of the governing
board of ERCOT appointed after the effective date of this paragraph who serves
as an unaffiliated member may not represent a market participant before the
governing board of ERCOT, the ERCOT technical advisory committee, or any of its
subcommittees or working groups, for a period of one year after the person
ceases to serve as a member of the governing board.
(h) Chief executive officer. The appointment
of the chief executive officer of ERCOT is subject to commission approval.
ERCOT shall notify the commissioners when a vacancy occurs for the chief
executive officer. ERCOT shall provide information to the commissioners
concerning the process for selecting a new chief executive officer, the
candidates who have been identified and their qualifications, any
recommendation that will be made to the governing board, and any other
information requested by a commissioner. A person may not seek the position of
the ERCOT chief executive officer while serving as a commissioner. Compensation
to be paid to the ERCOT chief executive officer shall be subject to commission
review and approval.
(i) Required
reports and other information. ERCOT shall file with the commission the reports
and provide the information required by this subsection.
(1) The qualification criteria shall include:
(A) Definitions of the market
sectors;
(B) Levels of activity in
the electricity business in the ERCOT region that an organization in a market
sector must meet, in order for a representative of the organization to serve as
a member of the governing board;
(C) Standards of good standing that an
organization must meet, in order for a representative of the organization to
serve as a member of the governing board; and
(D) Standards of good standing that an
individual must meet, in order for the individual to serve as a member of the
governing board.
(2)
Operations report and plan. No later than January 15 of each year, ERCOT shall
file an operations report and plan. The commission may initiate a review of the
plan, at its discretion. The report and plan shall contain the following
information:
(A) A copy of an independent
audit of ERCOT's market operation for the report year;
(B) A summary of key market operations
statistics, including prices and quantities of energy and capacity purchased in
the markets operated by ERCOT;
(C)
A summary of key reliability statistics;
(D) A summary of transmission planning and
generation interconnection activities and the most recent report on capacity,
demand and reserves;
(E) A
description of ERCOT's roles and responsibilities within the electric market in
Texas, including system reliability, operation of energy and capacity markets,
managing transmission congestion, transmission planning and interconnection of
new generating plants, and a description of how ERCOT's roles and
responsibilities relate to the roles and responsibilities of the transmission
and distribution utilities and retail electric providers and to the North
American Electric Reliability Corporation and Texas Reliability
Entity;
(F) A risk management plan
that identifies any significant risks to system reliability, the operation of
ERCOT's energy and capacity markets, its management of transmission congestion,
and any other risks that would significantly disrupt the sale and delivery of
electricity within the ERCOT region, and the measures that might be taken to
mitigate such risks;
(G) An
emergency communications plan that describes how ERCOT will communicate with
the public, media, governmental entities, and market participants concerning
events that affect the bulk electric system;
(H) An assessment of the reliability and
adequacy of the ERCOT system during extremely cold or extremely hot weather
conditions, or drought, for which purpose ERCOT has the right, upon reasonable
notice, to conduct generator site visits to review compliance with
weatherization plans and has the right to obtain from generators any
information concerning water supplies for generation purposes, including
contracts, water rights, and other information; and
(I) Identification of existing and potential
transmission constraints, and the need for additional transmission, generation
or demand response resources within the ERCOT region. The report shall include
projections of changes in demand, the capability of generation, energy storage,
and demand response resources, projected reserve margins, alternatives for
meeting system needs, and recommendations for meeting system needs.
(3) Quarterly reports. ERCOT shall
file quarterly reports no later than 45 days after the end of each quarter,
which shall include:
(A) Any internal audit
reports that were produced during the reporting quarter;
(B) A report on performance measures, as
prescribed by the commission;
(C)
By account item as established in the fee-filing package prescribed by the
commission under § 22.252 of this title (relating to Procedures for
Approval of ERCOT Fees and Rates) a report of:
(i) ERCOT fees and other rates, funds
allocated, funds encumbered, and funds expended;
(ii) An explanation for expenditures
deviating from the original funding allocation for the particular account
item;
(iii) For the report covering
the fourth quarter of ERCOT's fiscal year, a detailed explanation of how
unexpended funds will be expended in the subsequent year; and
(D) Any other information the
commission may deem necessary.
(4) Emergency reports. If ERCOT management
becomes aware of any event or situation that could reasonably be anticipated to
adversely affect the reliability of the regional electric network; the
operation or competitiveness of the ERCOT market; ERCOT's performance of
activities related to the customer registration function; or the public's
confidence in the ERCOT market or in ERCOT's performance of its duties, ERCOT
management shall immediately notify the chairman of the commission, or the
chairman's designee, and the executive director of the commission, or the
executive director's designee, by telephone. Additionally, ERCOT shall file a
written report of the facts involved by the end of the following business day
after becoming aware of such event or situation, unless the executive director
specifies, in writing, that the report may be delayed. The executive director
may not authorize a delay of more than 30 days for filing the required written
report. For good cause, the commission may grant further delays in filing the
required report. If it determines that additional reports are necessary, the
commission may establish a schedule for the filing of additional reports after
the initial written report by ERCOT. As a part of any additional written
report, ERCOT may be required to fully explain the facts and to disclose any
actions it has taken, or will take, in order to prevent a recurrence of the
events that led to the need for filing an emergency report.
(5) Meeting Periodicity Report. Beginning
with the effective date of this section, ERCOT shall recommend annually to the
commission the periodicity of governing board meetings. ERCOT's recommendation
shall be based on an examination of the frequency of meetings conducted by
similar organizations and shall include an estimate of the costs associated
with meeting more frequently than once per quarter.
(j) Compliance with rules or orders. ERCOT
shall inform the commission with as much advance notice as is practical if
ERCOT realizes that it will not be able to comply with PURA, any provision of
this chapter, or a commission order. If ERCOT fails to comply with PURA, any
provision of this chapter, or a commission order, the commission may, after
notice and opportunity for hearing, adopt the measures specified in this
subsection or such other measures as it determines are appropriate.
(1) The commission may require ERCOT to
submit, for commission approval, a proposal that details the actions ERCOT will
undertake to remedy the non-compliance.
(2) The commission may require ERCOT to begin
submitting reports, in a form and at a frequency determined by the commission,
that demonstrate ERCOT's current performance in the areas of
non-compliance.
(3) The commission
may require ERCOT to undergo an audit performed by an appropriate independent
third party.
(4) The commission may
assess administrative penalties under PURA Chapter 15, Subchapter B.
(5) The commission may suspend or revoke
ERCOT's certification under PURA §39.151(c) or deny a request for change
in the terms associated with such certification.
(6) Nothing in this section shall preclude
any form of civil relief that may be available under federal or state
law.
(k) Priority of
commission rules. This section supersedes any protocols or procedures adopted
by ERCOT that conflict with the provisions of this section. The adoption of
this section does not affect the validity of any rule or procedure adopted or
any action taken by ERCOT prior to the adoption of this section.
Notes
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