TITLE 16. ECONOMIC REGULATION

PART 2. PUBLIC UTILITY COMMISSION OF TEXAS

CHAPTER 25. SUBSTANTIVE RULES APPLICABLE TO ELECTRIC SERVICE PROVIDERS

SUBCHAPTER C. INFRASTRUCTURE AND RELIABILITY

16 TAC §25.57

The Public Utility Commission of Texas (commission) proposes new 16 Texas Administrative Code (TAC) §25.57 relating to Power Outage Alert Criteria. This proposed rule will establish the criteria for the content, activation, and termination of regional and statewide power outage alerts as required by Tex. Gov't. Code §411.301(b), enacted by the 87th Texas Legislature as Senate Bill 3.

Growth Impact Statement

The agency provides the following governmental growth impact statement for the proposed rule, as required by Tex. Gov't. Code §2001.0221. The agency has determined that for each year of the first five years that the proposed rule is in effect, the following statements will apply:

(1) the proposed rule will not create a government program and will not eliminate a government program;

(2) implementation of the proposed rule will not require the creation of new employee positions and will not require the elimination of existing employee positions;

(3) implementation of the proposed rule will not require an increase and will not require a decrease in future legislative appropriations to the agency;

(4) the proposed rule will not require an increase and will not require a decrease in fees paid to the agency;

(5) the proposed rule will not create a new regulation;

(6) the proposed rule will not expand, limit, or repeal an existing regulation;

(7) the proposed rule will not change the number of individuals subject to the rule's applicability; and

(8) the proposed rule will not affect this state's economy.

Fiscal Impact on Small and Micro-Businesses and Rural Communities

There is no adverse economic effect anticipated for small businesses, micro-businesses, or rural communities as a result of implementing the proposed rule. Accordingly, no economic impact statement or regulatory flexibility analysis is required under Tex. Gov't. Code §2006.002(c).

Takings Impact Analysis

The commission has determined that the proposed rule will not be a taking of private property as defined in chapter 2007 of the Texas Government Code.

Fiscal Impact on State and Local Government

Ms. Mariah Benson, Economist, Market Analysis Division, has determined that for the first five-year period the proposed rule is in effect, there will be no fiscal implications for the state or for units of local government under Tex. Gov't. Code §2001.024(a)(4) as a result of enforcing or administering the sections.

Public Benefits

Ms. Benson has determined that for each year of the first five years the proposed section is in effect the public benefit anticipated as a result of enforcing this section will be greater public awareness of the potential for electricity outages. There will be no adverse economic effect on small businesses or micro-businesses as a result of enforcing this section.

Local Employment Impact Statement

For each year of the first five years the proposed section is in effect, there should be no effect on a local economy; therefore, no local employment impact statement is required under Tex. Gov't. Code §2001.022.

Costs to Regulated Persons

Tex. Gov't. Code §2001.0045(b) does not apply to this rulemaking because the commission is expressly excluded under subsection §2001.0045(c)(7).

Public Hearing

The commission staff will conduct a public hearing on this rulemaking on January 14, 2022, at 10:00 a.m. in the Commissioners' Hearing Room, 7th floor, William B. Travis Building if requested in accordance with Tex. Gov't. Code §2001.029. The request for a public hearing must be received by January 11, 2022. If a request for public hearing is received, commission staff will file in this project a notice of hearing.

Public Comments

Interested persons may file comments electronically through the interchange on the commission's website. Comments must be filed by January 11, 2022. Comments should be organized in a manner consistent with the organization of the proposed rules. The commission invites specific comments regarding the costs associated with, and benefits that will be gained by, implementation of the proposed rule. The commission will consider the costs and benefits in deciding whether to modify the proposed rules on adoption. Commission staff strongly encourages commenters to include a bulleted executive summary to assist Commission Staff in reviewing the filed comments in a timely fashion. All comments should refer to Project Number 52287.

Statutory Authority

The new rule is proposed under PURA §14.002, which provides the Public Utility Commission with the authority to make adopt and enforce rules reasonably required in the exercise of its powers and jurisdiction. The amended rule is also proposed under Tex. Gov't. Code §2261.253, which requires each state agency to establish a procedure, by rule, to identify each contract that requires enhanced contract monitoring.

Cross Reference to Statute: Public Utility Regulatory Act §14.002 and Tex. Gov't. Code §2261.253.

§25.57.Power Outage Alert Criteria.

(a) Purpose and Applicability. This section establishes criteria for the activation, content, and termination of power outage alerts (POAs) as required by Texas Government Code §411.301(b). This section applies to the Electric Reliability Council of Texas (ERCOT) and transmission service providers in power regions in Texas other than the ERCOT power region.

(b) Definitions.

(1) Load shed instructions--Directions given by a reliability coordinator to a transmission service provider to reduce electricity usage along its systems by a described amount to prevent longer and larger outages for an entire power region.

(2) System-wide--The entirety of a power region.

(c) Issuance of a POA. The commission may recommend the Texas Department of Public Safety issue a POA based on information received from ERCOT and transmission service providers in power regions other than ERCOT. The issuance of a POA may be recommended when load shed instructions have been issued or are likely to be issued because the system-wide power supply in one or more power regions within Texas may be inadequate to meet demand.

(1) The commission may recommend the Texas Department of Public Safety issue a POA statewide or for one or more specific power regions in Texas.

(2) In conjunction with or as an alternative to recommending the issuance of a system-wide POA, the commission may disseminate information by contacting the media, posting on social media, notifying government officials, or via other available means of communication.

(3) In determining whether to recommend the issuance of a POA, the commission will consider the likelihood of system-wide load shed instructions being issued, the expected length of time the load shed instructions will be in effect, and any other relevant information.

(d) POA for the ERCOT power region.

(1) ERCOT must notify the commission when:

(A) ERCOT's forecasts indicate system-wide generation supply may be insufficient to meet demand within the next 48 hours; or

(B) ERCOT issues or is preparing to issue load shed instructions.

(2) A notice under paragraph (1) of this subsection must include any available, relevant information to assist the commission in determining whether to recommend the issuance of a POA and what information should be in a POA. The notice must include, but is not limited to:

(A) Whether load shed instructions have been issued;

(B) Whether capacity is forecasted to be insufficient to meet demand and, if so, an estimated time when load shed instructions may be necessary;

(C) If applicable and known, an estimated time when load shed instructions may be recalled; and

(D) If applicable and known, the initiating event or circumstances that prompted the load shed instructions.

(3) ERCOT must notify the commission when any of the applicable conditions listed under paragraph (1) of this subsection are no longer applicable. This notice must include information on any of the remaining conditions listed under paragraph (1) of this subsection that are still applicable.

(4) ERCOT must establish a procedure, in consultation with commission staff, to provide the commission with notifications required under this subsection.

(5) The commission may:

(A) Request additional information and updates from ERCOT;

(B) Recommend the issuance of a POA;

(C) Recommend the issuance of updates to a POA; and

(D) Recommend the termination of a POA.

(e) POA for power regions other than ERCOT.

(1) A transmission service provider in a power region other than ERCOT must notify the commission when it has received load shed instructions from the applicable reliability coordinator to shed load in Texas.

(2) A notice provided under paragraph (1) of this subsection must include:

(A) Whether load shed instructions have been issued;

(B) If applicable and known, an estimated time when load shed instructions will be recalled; and

(C) If applicable and known, the cause or initiating event of the load shed instructions.

(3) The transmission service provider must notify the commission when the applicable reliability coordinator has recalled the load shed instructions. The transmission service provider's notice must include any available information regarding power outages and the expectation for power restoration within its service territory.

(4) A transmission service provider covered by this subsection must establish a procedure, in consultation with commission staff, to provide the commission with notifications required under this subsection.

(5) The commission may:

(A) Request additional information and updates from the transmission service provider;

(B) Recommend the issuance of a POA;

(C) Recommend the issuance of updates to a POA; and

(D) Recommend the termination of a POA.

(f) POA Content. When known and as applicable, the POA must provide the following information:

(1) Whether system-wide load shed is occurring or expected to occur imminently;

(2) A brief explanation of the circumstances surrounding the load shed event or expected load shed event;

(3) A statement that an electricity customer may experience a power outage;

(4) Where an electricity customer can seek assistance while the electricity customer's power may be out; and

(5) Any other information deemed relevant and of assistance to electricity customers.

The agency certifies that legal counsel has reviewed the proposal and found it to be within the state agency's legal authority to adopt.

Filed with the Office of the Secretary of State on December 17, 2021.

TRD-202105114

Melissa Ethridge

Assistant Rules Coordinator

Public Utility Commission of Texas

Earliest possible date of adoption: January 30, 2022

For further information, please call: (512) 936-7299


SUBCHAPTER I. TRANSMISSION AND DISTRIBUTION

DIVISION 2. TRANSMISSION AND DISTRIBUTION APPLICABLE TO ALL ELECTRIC UTILITIES

16 TAC §25.218

The Public Utility Commission of Texas (commission) proposes new 16 Texas Administrative Code (TAC) §25.218, relating to Middle Mile Broadband. This proposed rule will implement Public Utility Regulatory Act (PURA) Chapter 43 as revised by HB 3853 during the Texas 87th Regular Legislative Session. This rule will allow amenable utilities with excess fiber capacity to establish Middle Mile Broadband Service with internet service providers (ISPs) in unserved and underserved areas of Texas.

The commission also requests comment from interested persons on the following questions:

1. Should the terms "unserved area" and "underserved area" be defined in the proposed rule? If so, how should the terms "unserved area" and "underserved area" be defined and determined?

Comments responding to these questions should be filed in accordance with the instructions below under the heading "Public Comments."

Growth Impact Statement

The agency provides the following governmental growth impact statement for the proposed rule, as required by Texas Government Code §2001.0221. The agency has determined that for each year of the first five years that the proposed rule is in effect, the following statements will apply:

(1) the proposed rule will not create a government program and will not eliminate a government program;

(2) implementation of the proposed rule will not require the creation of new employee positions and will not require the elimination of existing employee positions;

(3) implementation of the proposed rule will not require an increase and will not require a decrease in future legislative appropriations to the agency;

(4) the proposed rule will not require an increase and will not require a decrease in fees paid to the agency;

(5) the proposed rule will not create a new regulation;

(6) the proposed rule will not expand, limit, or repeal an existing regulation;

(7) the proposed rule will not change the number of individuals subject to the rule's applicability; and

(8) the proposed rule will not affect this state's economy.

Fiscal Impact on Small and Micro-Businesses and Rural Communities

There is no adverse economic effect anticipated for small businesses, micro-businesses, or rural communities as a result of implementing the proposed rule. Accordingly, no economic impact statement or regulatory flexibility analysis is required under Texas Government Code §2006.002(c).

Takings Impact Analysis

The commission has determined that the proposed rule will not be a taking of private property as defined in chapter 2007 of the Texas Government Code.

Fiscal Impact on State and Local Government

Shawnee Claiborn-Pinto, Sr. Economist, Market Analysis Division, has determined that for the first five-year period the proposed rule is in effect, there will be no fiscal implications for the state or for units of local government under Texas Government Code §2001.024(a)(4) as a result of enforcing or administering the sections.

Public Benefits

Ms. Claiborn-Pinto has determined that for each year of the first five years the proposed section is in effect, the public benefit anticipated as a result of enforcing the section will be the potential for additional high speed broadband internet services to become available throughout the state. There will be no adverse economic effect on small businesses or micro-businesses as a result of enforcing this section.

Local Employment Impact Statement

For each year of the first five years the proposed section is in effect, there should be no effect on a local economy; therefore, no local employment impact statement is required under Texas Government Code §2001.022.

Costs to Regulated Persons

Texas Government Code §2001.0045(b) does not apply to this rulemaking because the commission is expressly excluded under paragraph §2001.0045(c)(7).

Public Hearing

The commission staff will conduct a public hearing on this rulemaking on February 3, 2022, at 9:00 A.M. in the Commissioners' Hearing Room, 7th floor, William B. Travis Building if requested in accordance with Tex. Gov't. Code §2001.029. The request for a public hearing must be received by January 31, 2022. If a request for public hearing is not received, commission staff will file in this project a memo canceling the hearing.

Public Comments

Interested persons may file comments electronically through the interchange on the commission's website. Comments must be filed by 3:00 p.m., Tuesday, January 18, 2022. Reply Comments are due by 3:00 p.m., Monday January 31, 2022. Commission staff strongly encourages commenters to include a bulleted executive summary to assist Commission Staff in reviewing the filed comments in a timely fashion. Comments should be organized in a manner consistent with the organization of the proposed rule. The commission invites specific comments regarding the costs associated with, and benefits that will be gained by, implementation of the proposed rule. The commission will consider the costs and benefits in deciding whether to modify the proposed rule on adoption. All comments should refer to Project Number 52845.

Statutory Authority

The proposed rule is adopted under PURA §14.001, which provides the commission the general power to regulate and supervise the business of each public utility within its jurisdiction and to do anything specifically designated or implied by PURA that is necessary and convenient to the exercise of that power and jurisdiction; §14.002, which provides the Public Utility Commission with the authority to make adopt and enforce rules reasonably required in the exercise of its powers and jurisdiction; and PURA Chapter 43, which provides a framework for implementation of middle mile broadband in Texas.

Cross Reference to Statute: Public Utility Regulatory Act §14.001, 14.002 and Chapter 43.

§25.218.Middle Mile Broadband Service.

(a) Purpose and application. This section implements Public Utility Regulatory Act (PURA) Chapter 43, permitting an electric utility to implement middle mile broadband service for excess fiber capacity. This section applies to an electric utility and a transmission and distribution utility regardless of whether the utility is offering customer choice under PURA Chapter 39.

(b) Definitions. The following terms, when used in this section, have the following meanings unless the context indicates otherwise.

(1) Affected property owner--an owner of real property that is burdened by an easement or other property right owned or leased by an electric utility whose property is listed on the most recent tax roll of each county authorized to levy property taxes against the property and will be affected by the installation or operation of middle mile broadband service on an electric delivery system or other facilities of the electric utility. A property owner whose real property is burdened by an existing easement or other property right that permits the provision of third-party middle mile broadband service on an electric utility delivery system is not an affected property owner.

(2) Broadband service--retail internet service provided by a commercial internet service provider with the capability of providing a download speed of at least 25 megabits per second and an upload speed of at least 3 megabits per second.

(3) Internet service provider--a commercial entity that provides internet services to end-use customers on a retail basis.

(4) Electric delivery system--the power lines and related transmission and distribution facilities constructed to deliver electric energy to the electric utility's customers.

(5) Middle mile broadband service--the provision of excess fiber capacity on an electric utility's electric delivery system or other facilities to an internet service provider to provide broadband service. The term does not include provision of internet service to end-use customers on a retail basis.

(c) Authorization for middle mile broadband service.

(1) An electric utility may own, construct, maintain, and operate fiber optic cables and other facilities for providing middle mile broadband service primarily for unserved and underserved areas consistent with the requirements of this section. The electric utility has the right to decide, in its sole discretion, whether to implement middle mile broadband service and may not be penalized for deciding to implement or not to implement that service.

(2) An electric utility that elects to provide middle mile broadband service must determine on a nondiscriminatory basis which internet service providers may access excess fiber capacity on the electric utility's electric delivery system or other facilities and provide access points to allow connection between the electric utility's electric delivery system or other facilities and the systems of those internet service providers. An electric utility is prohibited from leasing excess fiber capacity to provide middle mile broadband service to an affiliated internet service provider.

(3) The electric utility must provide access to excess fiber capacity only on reasonable and nondiscriminatory terms and conditions that assure the electric utility the unimpaired ability to comply with and enforce all applicable federal and state requirements regarding the safety, reliability, and security of the electric delivery system.

(4) Nothing in this section is intended to restrict an electric utility from owning, constructing, maintaining, or operating fiber optic cables or a broadband system for the electric utility's own use to support the operation of the electric utility's electric delivery system or for other lawful purposes.

(d) Charges. An electric utility that owns and operates facilities to provide middle mile broadband service may lease excess fiber capacity on the electric utility's electric delivery system or other facilities to an internet service provider on a wholesale basis and must charge the internet service provider for the use of the electric utility's system for all costs associated with that use. The rates, terms, and conditions of a lease of excess fiber capacity described by this section must be nondiscriminatory. An electric utility may not lease excess fiber capacity to provide middle mile broadband service to an affiliated internet service provider.

(e) Participation by electric utility.

(1) An electric utility may install and operate facilities to provide middle mile broadband service on any part of its electric delivery system or other facilities for internet service providers but may not construct new electric delivery facilities for the purpose of expanding the electric utility's middle mile broadband service.

(2) An electric utility that owns and operates middle mile broadband service:

(A) may lease excess fiber capacity on the electric utility's electric delivery system or other facilities to an internet service provider on a wholesale basis; and

(B) may not provide internet service to end-use customers on a retail basis.

(f) Commission review of utility middle mile plan.

(1) Filing requirements. An electric utility that plans a project to deploy middle mile broadband service must submit to the commission a written plan that includes:

(A) a demonstration that the middle mile broadband service will be used only for unserved and underserved areas;

(B) a sworn statement by a cybersecurity expert attesting that cybersecurity has been properly addressed for implementing and providing middle mile broadband service;

(C) the route of the middle mile broadband service infrastructure proposed for the project;

(D) the location of the electric utility's infrastructure that will be used in connection with the project;

(E) an estimate of potential unserved or underserved broadband customers that would be served by the internet service provider;

(F) the capacity, number of fiber strands, and any other facilities of the middle mile broadband service that will be available to lease to internet service providers;

(G) the estimated cost of the project, including an itemization of engineering costs, construction costs, permitting costs, right-of-way costs, a reasonable allowance for funds used during construction, and all other costs associated with the lease and use of the electric utility's system for middle mile broadband service by ISPs;

(H) the proposed schedule of construction for the project;

(I) testimony, exhibits, and other evidence that demonstrates the project will allow for the provision and maintenance of middle mile broadband service to unserved and underserved areas with a sworn statement attesting compliance with subsection (e) of this section;

(J) a copy of the lease with the ISP for middle mile broadband service and a statement attesting that the lease is in compliance with subsection (c)(2) and (c)(3) of this section, and subsection (d) of this section;

(K) a copy of the final order for the electric utility's last comprehensive base-rate proceeding and associated Interchange number for said base-rate proceeding;

(L) a disclosure of all state and federal funds, including but not limited to, subsidies, grants, and tax benefits, credits, or deductions, utilized by the electric utility and ISP in association with the provision of middle mile broadband service;

(M) a demonstration that the revenues received from the provision of middle mile broadband service under the plan offset all construction, maintenance, operations, and other costs and all return associated with the service;

(N) any other information that the applicant considers relevant.

(2) Notice and intervention deadline. On or before the day after it files its plan, the electric utility must provide notice as required below and must include in the notice the docket number for the new proceeding. Failure by an electric utility to provide timely notice, as determined by the commission or presiding officer, will toll the intervention deadline under subsection (f)(2)(C) of this section until the date timely notice is issued.

(A) Notice to affected property owners under this section must:

(i) Be sent by first class mail to the last known address of each affected property owner and, if available, by electronic service.

(ii) State whether any new fiber optic cables used for middle mile broadband service will be located above or below ground in the easement or other property right.

(B) Notice to all parties in the electric utility's last comprehensive base-rate proceeding must be sent by first class mail to the last known address of each party in the electric utility's last comprehensive base-rate proceeding or by electronic service, if available.

(C) The intervention deadline is 45 days from the date service of notice is completed.

(D) Not later than the 60th day after the date an electric utility mails notice to potential intervenors under this section:

(i) An affected property owner may submit to the electric utility a written protest of the intended use of the easement or other property right for middle mile broadband service. Within three working days of receipt of a written protest by an affected property owner, the electric utility must file the protest with the commission.

(ii) An electric utility that receives a timely written protest from an affected property owner may not use the easement or other property right for middle mile broadband service unless the protester later agrees in writing to that use or that use is authorized by law. If an affected property owner fails to submit a timely written protest, an electric utility may proceed with its plan to provide middle mile broadband service without modifying or expanding the easement for the property owner.

(E) An electric utility that receives a timely written protest from an affected property owner regarding the proposed middle mile broadband service plan may cancel the project at any time.

(3) Commission processing of electric utility's plan.

(A) The commission must approve, modify, or reject an electric utility's middle mile plan submitted to the commission under this section not later than the 181st day after the date the plan is deemed sufficient.

(B) Following the filing of a plan by an electric utility under this section, the commission may review the electric utility's plan for middle mile broadband service under subsection (f) of this section or refer the application to the State Office of Administrative Hearings (SOAH). Upon referral to SOAH:

(i) The commission delegates authority to the presiding officer to deem plans sufficient, approve plans, and modify approved plans filed under this subsection through a notice of approval under §22.35(b)(1) (relating to Information Disposition) of this title.

(ii) The presiding officer will review for sufficiency the electric utility's plan for middle mile broadband service under paragraph (1) of this subsection and notice to potential intervenors under paragraph (2) of this subsection.

(iii) The presiding officer must establish a procedural schedule that will enable the commission to, approve, modify, or reject the plan not later than the 181st day after the date the plan is deemed sufficient.

(C) A motion to find a plan filing materially deficient must be filed no later than seven days after the intervention deadline. The motion must specify the nature of the deficiency and the relevant portions of the plan and cite the particular requirement under paragraph (1) of this subsection with which the plan is alleged not to comply. The electric utility's response to a motion to find a plan materially deficient must be filed no later than five working days after such motion is received.

(D) An approved plan may be updated or amended subject to commission approval in accordance with this subsection.

(g) Cost recovery for deployment of middle mile broadband facilities.

(1) Where an electric utility installs facilities used to provide middle mile broadband service under a plan approved by the commission under this section, the electric utility's investment in those facilities is eligible for inclusion in the electric utility's invested capital. Any fees or operating expenses that are reasonable and necessary are eligible for inclusion as operating expenses for purposes of any proceeding under PURA Chapter 36.

(2) In a proceeding under PURA Chapter 36, revenue received by an electric utility from an internet service provider for the use of middle mile broadband service must be applied as a revenue credit to customers in proportion to the customers' funding of the underlying infrastructure.

(3) An electric utility submitting a plan must ensure that revenues received from the provision of middle mile broadband service offset all construction, maintenance, operations, and other costs and all return associated with the service.

(h) Reliability of electric systems maintained.

(1) An electric utility that installs and operates facilities to provide middle mile broadband service must employ all reasonable measures to ensure that the operation of the middle mile broadband service does not interfere with or diminish the reliability of the utility's electric delivery system.

(2) If a disruption in the provision of electric service occurs, the electric utility is governed by the terms and conditions of the retail electric delivery service tariff.

(3) The electric utility may take all necessary actions regarding its middle mile broadband service and the facilities required in the provision of that service to address circumstances that may pose health, safety, security, or reliability concerns.

(4) At all times, the provision of broadband service is secondary to the reliable provision of electric delivery services.

(5) Except as provided by contract or tariff, an electric utility is not liable to any person, including an internet service provider, for any damages, including direct, indirect, physical, economic, exemplary, or consequential damages, including loss of business, loss of profits or revenue, or loss of production capacity caused by a fluctuation, disruption, or interruption of middle mile broadband service that is caused in whole or in part by:

(A) force majeure; or

(B) the electric utility's provision of electric delivery services, including actions taken by the electric utility to ensure the reliability and security of the electric delivery system and actions taken in response to address all circumstances that may pose health, safety, security, or reliability concerns.

The agency certifies that legal counsel has reviewed the proposal and found it to be within the state agency's legal authority to adopt.

Filed with the Office of the Secretary of State on December 17, 2021.

TRD-202105136

Andrea Gonzalez

Rules Coordinator

Public Utility Commission of Texas

Earliest possible date of adoption: January 30, 2022

For further information, please call: (512) 936-7244