Texas Legislature Enrolls Demand Ratchet Waiver Bill

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May 25, 2011

The Texas legislature has enrolled and sent to the governor HB 1064, which requires transmission and distribution utilities to waive the demand ratchet charged to REPs in connection to their service to certain customers.

The legislation leaves the cutoff for the waiver at the PUCT's discretion, and allows the waiver to be granted in the utility's next base rate proceeding (as opposed to an expedited process to implement the waiver).

Specifically, the legislation would require the utilities to waive the application of demand ratchet provisions for each "nonresidential secondary service customer" that has a maximum load factor equal to or below a factor set by PUCT rules.

Utilities would be directed to specify in tariff whether non-residential secondary service customers that qualify for the waiver are to be billed for distribution service charges on the basis of: kilowatts; kilowatt-hours; or kilovolt-amperes.

The PUCT shall, "modify the utility's tariff in the utility's next base rate case to implement the waiver."

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