UTILITIES CODE
CHAPTER 104. RATES AND SERVICES
SUBCHAPTER A. GENERAL PROVISIONS
§ 104.001. AUTHORIZATION TO ESTABLISH AND REGULATE
RATES. (a) The railroad commission is vested with all the
authority and power of this state to ensure compliance with the
obligations of gas utilities in this subtitle.
(b) The regulatory authority may establish and regulate
rates of a gas utility and may adopt rules for determining:
(1) the classification of customers and services; and
(2) the applicability of rates.
(c) A rule or order of the regulatory authority may not
conflict with a ruling of a federal regulatory body.
Acts 1997, 75th Leg., ch. 166, § 1, eff. Sept. 1, 1997.
§ 104.002. COMPLIANCE WITH SUBTITLE. A gas utility may
not:
(1) charge, collect, or receive a rate for utility
service except as provided by this subtitle; or
(2) impose a rule or regulation except as provided by
this subtitle.
Acts 1997, 75th Leg., ch. 166, § 1, eff. Sept. 1, 1997.
§ 104.003. JUST AND REASONABLE RATES. (a) The
regulatory authority shall ensure that each rate a gas utility or
two or more gas utilities jointly make, demand, or receive is just
and reasonable. A rate may not be unreasonably preferential,
prejudicial, or discriminatory but must be sufficient, equitable,
and consistent in application to each class of consumer. In
establishing a gas utility's rates, the railroad commission may
treat as a single class two or more municipalities that a gas
utility serves if the commission considers that treatment to be
appropriate.
(b) A rate for a pipeline-to-pipeline transaction or to a
transportation, industrial, or similar large volume contract
customer is considered to be just and reasonable and otherwise to
comply with this section and shall be approved by the regulatory
authority if:
(1) neither the gas utility nor the customer had an
unfair advantage during the negotiations;
(2) the rate is substantially the same as the rate
between the gas utility and at least two of those customers under
the same or similar conditions of service; or
(3) competition does or did exist with another gas
utility, another supplier of natural gas, or a supplier of an
alternative form of energy.
(c) Subsection (b) does not apply:
(1) if a complaint is filed with the railroad
commission by a transmission pipeline purchaser of gas sold or
transported under the pipeline-to-pipeline or transportation rate;
or
(2) to a direct sale for resale to a gas distribution
utility at a city gate.
(d) The reasonableness of gas purchase costs included in a
city gate rate proposed to be charged for a sale for resale to a gas
distribution utility at a city gate may be reviewed at a city gate
rate proceeding even though the costs have been previously approved
as a rate for other parties under Subsection (b).
(e) Subsection (b)(1) does not apply to a rate charged or
offered to be charged to an affiliated pipeline utility.
Acts 1997, 75th Leg., ch. 166, § 1, eff. Sept. 1, 1997.
§ 104.004. UNREASONABLE PREFERENCE OR PREJUDICE
PROHIBITED. A gas utility may not:
(1) grant an unreasonable preference or advantage
concerning rates or services to a person in a classification;
(2) subject a person in a classification to an
unreasonable prejudice or disadvantage concerning rates or
services; or
(3) establish or maintain an unreasonable difference
concerning rates of services between localities or between classes
of service.
Acts 1997, 75th Leg., ch. 166, § 1, eff. Sept. 1, 1997.
§ 104.005. EQUALITY OF RATES AND SERVICES. (a) A gas
utility may not directly or indirectly charge, demand, collect, or
receive from a person a greater or lesser compensation for a service
provided or to be provided by the utility than the compensation
prescribed by the applicable schedule of rates filed under Section
102.151.
(b) A person may not knowingly receive or accept a service
from a gas utility for a compensation greater or less than the
compensation prescribed by the schedules. A rate charged and
collected by a gas utility on September 1, 1983, may be continued
until schedules are filed.
(c) After notice and hearing, the railroad commission may,
in the public interest, order a gas utility to refund with interest
compensation received in violation of this section.
(d) This subtitle does not prevent a cooperative
corporation from returning to its members net earnings resulting
from its operations in proportion to the members' purchases from or
through the corporation.
Acts 1997, 75th Leg., ch. 166, § 1, eff. Sept. 1, 1997.
§ 104.006. RATES FOR AREA NOT IN MUNICIPALITY. Without
the approval of the railroad commission, a gas utility's rates for
an area not in a municipality may not exceed 115 percent of the
average of all rates for similar services for all municipalities
served by the same utility in the same county as that area.
Acts 1997, 75th Leg., ch. 166, § 1, eff. Sept. 1, 1997.
§ 104.007. DISCRIMINATION AND RESTRICTION ON
COMPETITION. A gas utility may not:
(1) discriminate against a person who sells or leases
equipment or performs services in competition with the gas utility;
or
(2) engage in a practice that tends to restrict or
impair that competition.
Acts 1997, 75th Leg., ch. 166, § 1, eff. Sept. 1, 1997.
§ 104.008. BURDEN OF PROOF. In a proceeding involving a
proposed rate change, the gas utility has the burden of proving
that:
(1) the rate change is just and reasonable, if the
utility proposes the change; or
(2) an existing rate is just and reasonable, if the
proposal is to reduce the rate.
Acts 1997, 75th Leg., ch. 166, § 1, eff. Sept. 1, 1997.
SUBCHAPTER B. COMPUTATION OF RATES
§ 104.051. ESTABLISHING OVERALL REVENUES. In
establishing a gas utility's rates, the regulatory authority shall
establish the utility's overall revenues at an amount that will
permit the utility a reasonable opportunity to earn a reasonable
return on the utility's invested capital used and useful in
providing service to the public in excess of its reasonable and
necessary operating expenses.
Acts 1997, 75th Leg., ch. 166, § 1, eff. Sept. 1, 1997.
§ 104.052. ESTABLISHING FAIR RATE OF RETURN. The
regulatory authority may not establish a rate that yields more than
a fair return on the adjusted value of the invested capital used and
useful in providing service to the public.
Acts 1997, 75th Leg., ch. 166, § 1, eff. Sept. 1, 1997.
§ 104.053. COMPONENTS OF ADJUSTED VALUE OF INVESTED
CAPITAL. (a) Gas utility rates shall be based on the adjusted
value of invested capital used and useful to the utility in
providing service and that adjusted value shall be computed on the
basis of a reasonable balance between:
(1) original cost, less depreciation; and
(2) current cost, less an adjustment for present age
and condition.
(b) The regulatory authority may determine a reasonable
balance that reflects:
(1) not less than 60 percent nor more than 75 percent
of the original cost of the property at the time the property was
dedicated to public use, whether by the gas utility that is the
present owner or by a predecessor, less depreciation; and
(2) not less than 25 percent nor more than 40 percent
of the current cost less an adjustment for present age and
condition.
(c) In determining a reasonable balance, the regulatory
authority may consider inflation, deflation, quality of service
being provided, growth rate of the service area, and need for the
gas utility to attract new capital.
(d) Construction work in progress, at cost as recorded on
the gas utility's books, may be included as part of the adjusted
value of invested capital used by and useful to the utility in
providing service, as necessary to the financial integrity of the
utility.
(e) Costs of facilities, revenues, expenses, taxes, and
reserves shall be separated or allocated as prescribed by the
regulatory authority.
(f) In this section, "original cost" means the actual money
cost or the actual money value of consideration paid other than
money.
Acts 1997, 75th Leg., ch. 166, § 1, eff. Sept. 1, 1997.
§ 104.054. DEPRECIATION, AMORTIZATION, AND
DEPLETION. (a) The railroad commission shall establish proper
and adequate rates and methods of depreciation, amortization, or
depletion for each class of property of a gas utility or municipally
owned utility.
(b) The rates and methods established under this section and
the depreciation account required under Section 102.152 shall be
used uniformly and consistently throughout rate-setting and appeal
proceedings.
Acts 1997, 75th Leg., ch. 166, § 1, eff. Sept. 1, 1997.
§ 104.055. NET INCOME; ALLOWABLE EXPENSES. (a) Net
income shall be used to establish just and reasonable rates. For
that purpose, "net income" means the total revenues of the gas
utility from gas utility service less all reasonable and necessary
expenses related to that gas utility service. The regulatory
authority shall determine those revenues and expenses in a manner
consistent with this subchapter.
(b) In establishing a gas utility's rates, the regulatory
authority may not allow a gas utility's payment to an affiliate for
the cost of a service, property, right, or other item or for an
interest expense to be included as capital cost or as expense
related to gas utility service except to the extent that the
regulatory authority finds the payment is reasonable and necessary
for each item or class of items as determined by the regulatory
authority. That finding must include:
(1) a specific finding of the reasonableness and
necessity of each item or class of items allowed; and
(2) a finding that the price to the gas utility is not
higher than the prices charged by the supplying affiliate to its
other affiliates or divisions or to a nonaffiliated person for the
same item or class of items.
(c) If an expense is allowed to be included in utility
rates, or an investment is included in the utility rate base, the
related income tax deduction or benefit shall be included in the
computation of income tax expense to reduce the rates. If an
expense is disallowed or not included in utility rates, or an
investment is not included in the utility rate base, the related
income tax deduction or benefit may not be included in the
computation of income tax expense to reduce the rates. The income
tax expense shall be computed using the statutory income tax rates.
(d) The regulatory authority may adopt reasonable rules
complying with this section with respect to including and excluding
certain expenses in computing the rates to be established.
(e) This section is not intended to increase gas utility
rates to the customer not caused by utility service. Utility rates
may include only expenses caused by utility service.
Acts 1997, 75th Leg., ch. 166, § 1, eff. Sept. 1, 1997.
§ 104.056. TREATMENT OF CERTAIN TAX BENEFITS. (a) In
determining the allocation of tax savings derived from liberalized
depreciation and amortization, the investment tax credit, and the
application of similar methods, the regulatory authority shall:
(1) balance equitably the interests of present and
future customers; and
(2) apportion accordingly the benefits between
consumers and the gas utility or municipally owned utility.
(b) If a gas utility or municipally owned utility retains a
portion of the investment tax credit, that portion shall be
deducted from the original cost of the facilities or other addition
to the rate base to which the credit applied to the extent allowed
by the Internal Revenue Code.
Acts 1997, 75th Leg., ch. 166, § 1, eff. Sept. 1, 1997.
§ 104.057. CONSIDERATION OF CERTAIN EXPENSES. (a) In
establishing a gas utility's rates, the regulatory authority may
not allow as a cost or expense an expenditure:
(1) described by Section 102.154 that the regulatory
authority determines to be not in the public interest; or
(2) for legislative advocacy.
(b) The regulatory authority may allow as a cost or expense
reasonable charitable or civic contributions not to exceed the
amount approved by the regulatory authority.
Acts 1997, 75th Leg., ch. 166, § 1, eff. Sept. 1, 1997.
§ 104.058. CONSIDERATION OF PROFIT OR LOSS FROM SALE OR
LEASE OF MERCHANDISE. In establishing a gas utility's or
municipally owned utility's rates, the regulatory authority may not
consider a profit or loss that results from the sale or lease of
merchandise, including appliances, fixtures, or equipment, to the
extent that merchandise is not integral to providing utility
service.
Acts 1997, 75th Leg., ch. 166, § 1, eff. Sept. 1, 1997.
SUBCHAPTER C. RATE CHANGES PROPOSED BY UTILITY
§ 104.101. DEFINITION. In this subchapter, "major
change" means an increase in rates that would increase the
aggregate revenues of the applicant more than the greater of
$100,000 or 2-1/2 percent. The term does not include an increase in
rates that the regulatory authority allows to go into effect or the
gas utility makes under an order of the regulatory authority after
hearings held with public notice.
Acts 1997, 75th Leg., ch. 166, § 1, eff. Sept. 1, 1997.
§ 104.102. STATEMENT OF INTENT TO INCREASE
RATES. (a) A gas utility may not increase its rates unless the
utility files a statement of its intent with the regulatory
authority that has original jurisdiction over those rates at least
35 days before the effective date of the proposed increase.
(b) The gas utility shall also mail or deliver a copy of the
statement of intent to the appropriate officer of each affected
municipality.
(c) The statement of intent must include:
(1) proposed revisions of tariffs and schedules; and
(2) a detailed statement of:
(A) each proposed increase;
(B) the effect the proposed increase is expected
to have on the revenues of the utility;
(C) each class and number of utility consumers
affected; and
(D) any other information required by the
regulatory authority's rules and regulations.
Acts 1997, 75th Leg., ch. 166, § 1, eff. Sept. 1, 1997.
§ 104.103. NOTICE OF INTENT TO INCREASE RATES. (a) The
gas utility shall:
(1) publish, in conspicuous form, notice to the public
of the proposed increase once each week for four successive weeks in
a newspaper having general circulation in each county containing
territory affected by the proposed increase; and
(2) provide notice of the proposed increase to any
other affected person as required by the regulatory authority's
rules.
(b) Instead of publishing newspaper notice, a gas utility
may provide notice to the public in an area outside the affected
municipality or in a municipality with a population of less than
2,500 by:
(1) mailing the notice by United States mail, postage
prepaid, to the billing address of each directly affected customer;
or
(2) including the notice, in conspicuous form, in the
bill of each directly affected customer.
Acts 1997, 75th Leg., ch. 166, § 1, eff. Sept. 1, 1997.
§ 104.104. EARLY EFFECTIVE DATE OF RATE
INCREASE. (a) For good cause shown, the regulatory authority may
allow a rate increase, other than a major change, to take effect:
(1) before the end of the 35-day period prescribed by
Section 104.102; and
(2) under conditions the regulatory authority
prescribes, subject to suspension as provided by this subchapter.
(b) The gas utility shall immediately revise its schedules
to include the increase.
Acts 1997, 75th Leg., ch. 166, § 1, eff. Sept. 1, 1997.
§ 104.105. DETERMINATION OF PROPRIETY OF RATE CHANGE;
HEARING. (a) If a schedule modifying or increasing rates is filed
with a regulatory authority, the regulatory authority shall, on
complaint by an affected person, or may, on its own motion, not
later than the 30th day after the effective date of the increase,
enter on a hearing to determine the propriety of the increase.
(b) The regulatory authority shall hold a hearing in every
case in which the increase constitutes a major change. The
regulatory authority may, however, use an informal proceeding if
the regulatory authority does not receive a complaint before the
expiration of 45 days after the date notice of the increase is
filed.
(c) The regulatory authority shall give reasonable notice
of the hearing, including notice to the governing body of each
affected municipality and county. The gas utility is not required
to provide a formal answer or file any other formal pleading in
response to the notice, and the absence of an answer does not affect
an order for a hearing.
Acts 1997, 75th Leg., ch. 166, § 1, eff. Sept. 1, 1997.
§ 104.106. PREFERENCE TO HEARING. The regulatory
authority shall:
(1) give preference to the hearing under this
subchapter and to deciding questions arising under this subchapter
over any other question pending before it; and
(2) decide the questions as quickly as possible.
Acts 1997, 75th Leg., ch. 166, § 1, eff. Sept. 1, 1997.
§ 104.107. RATE SUSPENSION; DEADLINE. (a) Pending
the hearing and a decision:
(1) the local regulatory authority, after delivering
to the gas utility a written statement of the regulatory
authority's reasons, may suspend the operation of the schedule for
not longer than 90 days after the date the schedule would otherwise
be effective; and
(2) the railroad commission may suspend the operation
of the schedule for not longer than 150 days after the date the
schedule would otherwise be effective.
(b) The 150-day period prescribed by Subsection (a)(2)
shall be extended for two days for each day the actual hearing on
the merits of the case exceeds 15 days.
(c) If the regulatory authority does not make a final
determination concerning a schedule of rates before expiration of
the applicable suspension period, the regulatory authority is
considered to have approved the schedule. This approval is subject
to the authority of the regulatory authority thereafter to continue
a hearing in progress.
Acts 1997, 75th Leg., ch. 166, § 1, eff. Sept. 1, 1997. Amended
by Acts 2001, 77th Leg., ch. 1233, § 67, eff. Sept. 1, 2001.
§ 104.108. TEMPORARY RATES. (a) The regulatory
authority may establish temporary rates to be in effect during the
applicable suspension period under Section 104.107.
(b) If the regulatory authority does not establish
temporary rates, the rates in effect when the suspended schedule
was filed continue in effect during the suspension period.
Acts 1997, 75th Leg., ch. 166, § 1, eff. Sept. 1, 1997.
§ 104.109. BONDED RATES. (a) A gas utility may put a
changed rate into effect by filing a bond with the regulatory
authority if the regulatory authority fails to make a final
determination within 90 days from the date the proposed increase
would otherwise be effective.
(b) The bonded rate may not exceed the proposed rate.
(c) The bond must be:
(1) payable to the regulatory authority in an amount,
in a form, and with a surety approved by the regulatory authority;
and
(2) conditioned on refund.
(d) The gas utility shall refund or credit against future
bills:
(1) money collected under the bonded rates in excess
of the rate finally ordered; and
(2) interest on that money, at the current interest
rate as determined by the regulatory authority.
Acts 1997, 75th Leg., ch. 166, § 1, eff. Sept. 1, 1997.
§ 104.110. ESTABLISHMENT OF FINAL RATES. (a) If,
after hearing, the regulatory authority finds the rates are
unreasonable or in violation of law, the regulatory authority
shall:
(1) enter an order establishing the rates the gas
utility shall charge or apply for the service in question; and
(2) serve a copy of the order on the gas utility.
(b) The rates established in the order shall be observed
thereafter until changed as provided by this subtitle.
Acts 1997, 75th Leg., ch. 166, § 1, eff. Sept. 1, 1997.
§ 104.111. APPROVAL OF DECREASE IN
RATES. Notwithstanding any other provision in this subtitle, the
regulatory authority may, without reference to the cost of service
standard prescribed by Section 104.051, administratively approve a
decrease in rates proposed by the applicant and agreed on by each
party directly affected unless the regulatory authority determines
that the proposed decrease is not in the public interest.
Acts 1997, 75th Leg., ch. 166, § 1, eff. Sept. 1, 1997.
§ 104.112. SURCHARGE TO RECOVER RELOCATION
COSTS. (a) This section applies to a gas utility's costs of
relocating a facility to accommodate construction or improvement of
a highway, road, street, public way, or other public work by or on
behalf of the United States, this state, a political subdivision of
this state, or another entity having the power of eminent domain
that are not reimbursed by a source other than as provided by this
section.
(b) A gas utility may recover its relocation costs to which
this section applies through a surcharge on gas volumes sold and
transported to customers in the service area where the relocation
occurred by applying to each appropriate regulatory authority for a
new rate schedule or tariff. The gas utility is not required to
file a statement of intent to increase rates to institute the
surcharge, and the other provisions of this subchapter, other than
appeal rights, do not apply to institution of the surcharge.
(c) An application under Subsection (b) must include
sufficient documentation to demonstrate:
(1) the requirement for each relocation;
(2) the entity requiring the relocation;
(3) costs incurred for relocation of comparable
facilities;
(4) surcharge computations; and
(5) that reasonable efforts have been made to receive
reimbursement from the entity requiring the relocation, if
applicable.
(d) Not later than the 35th day after the date an
application under Subsection (b) is received, the regulatory
authority shall administratively grant or deny the application.
Denial of the application must be based on a finding that:
(1) the relocation was not necessary or required;
(2) the costs of the relocation were excessive or not
supported;
(3) the utility did not pursue reimbursement from the
entity requiring the relocation, if applicable;
(4) the surcharge is unduly discriminatory among
customers or classes of customers located in the service area; or
(5) the period over which the relocation costs are
designed to be recovered is less than one or more than three years.
(e) If the regulating authority does not make a decision
before the deadline prescribed by Subsection (d), the application
is approved.
Added by Acts 1999, 76th Leg., ch. 219, § 1, eff. Sept. 1, 1999.
Amended by Acts 2001, 77th Leg., ch. 662, § 1, eff. Sept. 1,
2001.
SUBCHAPTER D. RATE CHANGES PROPOSED BY COMMISSION
§ 104.151. UNREASONABLE OR VIOLATIVE EXISTING
RATES. (a) If the regulatory authority, on its own motion or on
complaint by an affected person, after reasonable notice and
hearing, finds that the existing rates of a gas utility for a
service are unreasonable or in violation of law, the regulatory
authority shall:
(1) enter an order establishing the just and
reasonable rates to be observed thereafter, including maximum or
minimum rates; and
(2) serve a copy of the order on the gas utility.
(b) The rates set under Subsection (a) constitute the legal
rates of the gas utility until changed as provided by this subtitle.
Acts 1997, 75th Leg., ch. 166, § 1, eff. Sept. 1, 1997.
§ 104.152. INVESTIGATING COSTS OF OBTAINING SERVICE FROM
ANOTHER SOURCE. If a gas utility does not produce the service that
it distributes, transmits, or furnishes to the public for
compensation but obtains the service from another source, the
regulatory authority may investigate the cost of that production in
an investigation of the reasonableness of the gas utility's rates.
Acts 1997, 75th Leg., ch. 166, § 1, eff. Sept. 1, 1997.
SUBCHAPTER E. RATES FOR GOVERNMENTAL ENTITIES
§ 104.201. TRANSPORTATION RATES BETWEEN GAS UTILITY OR
MUNICIPALLY OWNED UTILITY AND STATE AGENCY. (a) Notwithstanding
Section 104.003(b), absent a contract for transportation service
between a state agency and a gas utility or municipally owned
utility, the railroad commission, not later than the 210th day
after the date either party files a request to set a transportation
rate, shall establish the transportation rate for the state agency.
The commission has exclusive original jurisdiction to establish a
transportation rate for a state agency under this section.
(b) The railroad commission shall base its determination of
the transportation rate under Subsection (a) on the cost of
providing the transportation service for both the distribution
system and the transmission system, as applicable, of the gas
utility or municipally owned utility.
(c) The railroad commission may order temporary rates under
Subsection (a) as provided for under the commission's appellate
jurisdiction.
Acts 1997, 75th Leg., ch. 166, § 1, eff. Sept. 1, 1997.
§ 104.202. EXCLUDED EXPENSES. (a) The rates that a gas
utility or municipally owned utility charges a state agency may not
include an amount representing a gross receipts assessment,
regulatory assessment, or similar expense of the utility.
(b) An expense under Subsection (a) that is reasonable and
is not recovered from a state agency under this section may be
recovered from other customers of the gas utility or municipally
owned utility.
(c) A gross receipts assessment, regulatory assessment, or
similar expense of the utility does not include a payment to a
municipality under a contract, franchise, or other agreement.
Acts 1997, 75th Leg., ch. 166, § 1, eff. Sept. 1, 1997. Amended
by Acts 1999, 76th Leg., ch. 1326, § 1, eff. June 18, 1999.
§ 104.203. PAYMENT IN LIEU OF TAX. (a) A payment made
in lieu of a tax by a municipally owned utility to the municipality
by which the utility is owned may not be considered an expense of
operation in establishing the utility's rate for providing utility
service to a school district or hospital district.
(b) A rate a municipally owned utility receives from a
school district or hospital district may not be used to make or to
cover the cost of making payments in lieu of taxes to the
municipality that owns the utility.
Acts 1997, 75th Leg., ch. 166, § 1, eff. Sept. 1, 1997.
SUBCHAPTER F. SERVICES
§ 104.251. GENERAL STANDARD. A gas utility shall
furnish service, instrumentalities, and facilities that are safe,
adequate, efficient, and reasonable.
Acts 1997, 75th Leg., ch. 166, § 1, eff. Sept. 1, 1997.
§ 104.252. AUTHORITY OF REGULATORY AUTHORITY CONCERNING
STANDARDS. A regulatory authority, on its own motion or on
complaint and after reasonable notice and hearing, may:
(1) adopt just and reasonable standards,
classifications, regulations, or practices a gas utility must
follow in furnishing a service;
(2) adopt adequate and reasonable standards for
measuring a condition, including quantity, quality, and pressure
relating to the furnishing of a service;
(3) adopt reasonable regulations for examining,
testing, and measuring a service; and
(4) adopt or approve reasonable rules, regulations,
specifications, and standards to ensure the accuracy of equipment,
including meters and instruments, used to measure a service.
Acts 1997, 75th Leg., ch. 166, § 1, eff. Sept. 1, 1997.
§ 104.253. RULE OR STANDARD. (a) A gas utility may
file with the regulatory authority a standard, classification,
regulation, or practice the utility follows.
(b) The standard, classification, regulation, or practice
continues in force until:
(1) amended by the utility; or
(2) changed by the regulatory authority as provided by
this subtitle.
Acts 1997, 75th Leg., ch. 166, § 1, eff. Sept. 1, 1997.
§ 104.254. SERVICE. A gas utility or municipally owned
utility may not refuse to provide service to a state agency if
pipeline capacity is available on an existing facility of the
utility.
Acts 1997, 75th Leg., ch. 166, § 1, eff. Sept. 1, 1997.
§ 104.2545. REQUIRED SERVICE TO PUBLIC RETAIL
CUSTOMER. (a) In this section, "service site" means facilities
or buildings operated by a public retail customer or a group of
adjacent facilities or buildings operated by a public retail
customer within one contiguous geographical area.
(b) Unless the utility is prohibited by other law from
providing the service and if sufficient pipeline capacity is
available on an existing facility of the utility to provide the
service, a gas utility or municipally owned utility may not refuse
to provide service to a public retail customer at a service site, at
rates established as provided by Subsection (c), the following
services:
(1) the sale of gas;
(2) the transportation of an annual average of 25
million British thermal units or more each day of gas that is:
(A) taken as a royalty in kind; and
(B) owned by the state or managed by a marketing
program operated by the state or by a state agency; or
(3) a combination of the services described by
Subdivisions (1) and (2).
(c) A utility shall provide a service described by
Subsection (b) at rates provided by a written contract negotiated
between the utility and the state or a state agency. If the utility
and the state or state agency are not able to agree to a contract
rate, a fair and reasonable rate may be determined for the public
retail customer, as a rate for a separate class of service, by the
railroad commission or, for municipally owned gas utilities, by the
relevant regulatory body under this chapter.
(d) In this section, "public retail customer" has the
meaning assigned by Section 35.101.
Added by Acts 1999, 76th Leg., ch. 300, § 1, eff. Sept. 1, 1999.
Amended by Acts 2003, 78th Leg., ch. 563, § 1, eff. June 20,
2003.
§ 104.255. BILLING. (a) A gas utility or municipally
owned utility may not bill or otherwise require the state or a state
agency or institution to pay for service before the service is
provided.
(b) The railroad commission shall adopt rules concerning
payment of bills by the state or a state agency to a gas utility or
municipally owned utility. The rules must be consistent with
Chapter 2251, Government Code.
(c) This subtitle does not prohibit a gas utility or
municipally owned utility from entering into an agreement with the
state or a state agency to establish a level or average monthly
service billing plan. An agreement under this subsection must
require reconciliation of the leveled or equalized bills quarterly.
Acts 1997, 75th Leg., ch. 166, § 1, eff. Sept. 1, 1997.
§ 104.2551. ELECTRONIC BILLING. A gas utility or
municipally owned utility may transmit the utility's bill for
services through the Internet or by other electronic means instead
of through the United States mail on the request of a customer of
the gas utility or municipally owned utility.
Added by Acts 2001, 77th Leg., ch. 1233, § 68, eff. Sept. 1,
2001.
§ 104.256. EXAMINATION AND TEST OF INSTRUMENT OR
EQUIPMENT; INSPECTION. (a) A regulatory authority may:
(1) examine and test equipment, including meters and
instruments, used to measure service of a gas utility; and
(2) set up and use on the premises occupied by a gas
utility an apparatus or appliance necessary for the examination or
test.
(b) The gas utility is entitled to be represented at an
examination, test, or inspection made under this section.
(c) The gas utility and its officers and employees shall
facilitate the examination, test, or inspection by giving
reasonable aid to the regulatory authority and to any person
designated by the regulatory authority for the performance of those
duties.
Acts 1997, 75th Leg., ch. 166, § 1, eff. Sept. 1, 1997.
§ 104.257. INSPECTION FOR CONSUMER. (a) A consumer
may have a meter or other measuring device tested by a gas utility:
(1) once without charge, after a reasonable period of
presumed accuracy that the regulatory authority establishes by
rule; and
(2) at a shorter interval on payment of a reasonable
fee established by the regulatory authority.
(b) The regulatory authority shall establish reasonable
fees to be paid for other examining or testing of a measuring device
on the request of a consumer.
(c) If the consumer requests the test under Subsection
(a)(2) and the measuring device is found unreasonably defective or
incorrect to the substantial disadvantage of the consumer, the fee
the consumer paid at the time of the request shall be refunded.
Acts 1997, 75th Leg., ch. 166, § 1, eff. Sept. 1, 1997.
§ 104.258. DISCONNECTION OF GAS SERVICE. (a) In this
section:
(1) "Extreme weather emergency" means a period during
which the previous day's highest temperature did not exceed 32
degrees Fahrenheit and the temperature is predicted to remain at or
below that level for the next 24 hours according to the nearest
National Weather Service reports.
(2) "Provider" means:
(A) a gas utility, as defined by Sections 101.003
and 121.001; and
(B) an owner, operator, or manager of a mobile
home park or apartment who purchases natural gas through a master
meter for delivery to a dwelling unit in a mobile home park or
apartment house under Chapter 124.
(b) A provider may not disconnect natural gas service to a
residential customer on a weekend day unless personnel of the
provider are available on that day to take payments and reconnect
service.
(c) A provider may not disconnect natural gas service to a
residential customer during an extreme weather emergency. The
provider shall defer collection of the full payment of bills that
are due during an extreme weather emergency until after the
emergency is over and shall work with customers to establish a pay
schedule for deferred bills.
Added by Acts 2001, 77th Leg., ch. 1149, § 1, eff. Sept. 1, 2001.
SUBCHAPTER G. INTERIM COST RECOVERY AND RATE ADJUSTMENT
§ 104.301. INTERIM ADJUSTMENT FOR CHANGES IN
INVESTMENT. (a) A gas utility that has filed a rate case under
Subchapter C within the preceding two years may file with the
regulatory authority a tariff or rate schedule that provides for an
interim adjustment in the utility's monthly customer charge or
initial block rate to recover the cost of changes in the investment
in service for gas utility services. The adjustment shall be
allocated among the gas utility's classes of customers in the same
manner as the cost of service was allocated among classes of
customers in the utility's latest effective rates for the area in
which the tariff or rate schedule is implemented. The gas utility
shall file the tariff or rate schedule, or the annual adjustment
under Subsection (c), with the regulatory authority at least 60
days before the proposed implementation date of the tariff, rate
schedule, or annual adjustment. The gas utility shall provide
notice of the tariff, rate schedule, or annual adjustment to
affected customers by bill insert or direct mail not later than the
45th day after the date the utility files the tariff, rate schedule,
or annual adjustment with the regulatory authority. During the
60-day period, the regulatory authority may act to suspend the
implementation of the tariff, rate schedule, or annual adjustment.
After the issuance of a final order or decision by a regulatory
authority in a rate case that is filed after the implementation of a
tariff or rate schedule under this section, any change in
investment that has been included in an interim adjustment in
accordance with the tariff or rate schedule under this section
shall no longer be subject to subsequent review for reasonableness
or prudence. Until the issuance of a final order or decision by a
regulatory authority in a rate case that is filed after the
implementation of a tariff or rate schedule under this section, all
amounts collected under the tariff or rate schedule before the
filing of the rate case are subject to refund.
(b) The amount the gas utility shall adjust the utility's
rates upward or downward under the tariff or rate schedule each
calendar year is based on the difference between the value of the
invested capital for the preceding calendar year and the value of
the invested capital for the calendar year preceding that calendar
year. The value of the invested capital is equal to the original
cost of the investment at the time the investment was first
dedicated to public use minus the accumulated depreciation related
to that investment.
(c) The interim adjustment shall be recalculated on an
annual basis in accordance with the requirements of Subsection (b).
The gas utility may file a request with the regulatory authority to
suspend the operation of the tariff or rate schedule for any year.
The request must be in writing and state the reasons why the
suspension is justified. The regulatory authority may grant the
suspension on a showing by the utility of reasonable justification.
(d) A gas utility may only adjust the utility's rates under
the tariff or rate schedule for the return on investment,
depreciation expense, ad valorem taxes, revenue related taxes, and
incremental federal income taxes related to the difference in the
value of the invested capital as determined under Subsection (b).
The return on investment, depreciation, and incremental federal
income tax factors used in the computation must be the same as the
factors reflected in the final order issued by or settlement
agreement approved by the regulatory authority establishing the gas
utility's latest effective rates for the area in which the tariff or
rate schedule is implemented.
(e) A gas utility that implements a tariff or rate schedule
under this section shall file with the regulatory authority an
annual report describing the investment projects completed and
placed in service during the preceding calendar year and the
investments retired or abandoned during the preceding calendar
year. The annual report shall also state the cost, need, and
customers benefited by the change in investment.
(f) In addition to the report required under Subsection (e),
the gas utility shall file with the regulatory authority an annual
earnings monitoring report demonstrating the utility's earnings
during the preceding calendar year.
(g) If the gas utility is earning a return on invested
capital, as demonstrated by the report filed under Subsection (f),
of more than 75 basis points above the return established in the
latest effective rates approved by a regulatory authority for the
area in which the tariff or rate schedule is implemented under this
section, the gas utility shall file a statement with that report
stating the reasons why the rates are not unreasonable or in
violation of law.
(h) If a gas utility that implements a tariff or rate
schedule under this section does not file a rate case under
Subchapter C before the fifth anniversary of the date on which the
tariff or rate schedule takes effect, the gas utility shall file a
rate case under that subchapter not later than the 180th day after
that anniversary in relation to any rates subject to the tariff or
rate schedule.
(i) This section does not limit the power of a regulatory
authority under Section 104.151.
(j) A gas utility implementing a tariff or rate schedule
under this section shall reimburse the railroad commission the
utility's proportionate share of the railroad commission's costs
related to the administration of the interim rate adjustment
mechanism provided by this section.
Added by Acts 2003, 78th Leg., ch. 938, § 1, eff. Sept. 1, 2003.
