Texas Utilities Code 36.205 – Purchased Power Cost Recovery
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(a) This section applies only to an increase or decrease in the cost of purchased electricity that has been:
(1) accepted by a federal regulatory authority; or
(2) approved after a hearing by the commission.
(b) The commission may use any appropriate method to provide for the adjustment of the cost of purchased electricity on terms determined by the commission.
Terms Used In Texas Utilities Code 36.205
- Corporation: A legal entity owned by the holders of shares of stock that have been issued, and that can own, receive, and transfer property, and carry on business in its own name.
- Obligation: An order placed, contract awarded, service received, or similar transaction during a given period that will require payments during the same or a future period.
- Person: includes corporation, organization, government or governmental subdivision or agency, business trust, estate, trust, partnership, association, and any other legal entity. See Texas Government Code 311.005
- Rule: includes regulation. See Texas Government Code 311.005
(c) Purchased electricity costs may be recovered:
(1) concurrently with the effective date of the changed costs to the purchasing electric utility; or
(2) as soon after the effective date as reasonably practical.
(d) The commission may provide a mechanism to allow an electric utility that has a noncontiguous geographical service area and that purchases power for resale for that noncontiguous service area from electric utilities that are not members of the Electric Reliability Council of Texas to recover purchased power costs for the area in a manner that reflects the purchased power cost for that specific geographical noncontiguous area. The commission may not require an electric cooperative corporation to use the mechanism provided under this section unless the electric cooperative corporation requests its use.
(e) Notwithstanding Subsection (a), an electric utility may apply to the commission for review and approval of an agreement between the electric utility and another person for the purchase of power by the electric utility if approval by the commission is a pre-condition to the effectiveness of the electric utility’s right or obligation to purchase power under the agreement. This subsection applies only to an agreement with a term of three years or more. The commission by rule shall implement this subsection consistent with the standards and procedures in the commission’s rules governing contested cases on certificates of convenience and necessity for generating facilities adopted under Sections 37.056 and 37.058. This subsection expires September 1, 2033.