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Bill aiming to block interconnections that could trigger FERC jurisdiction draws technical questions; committee substitute expected
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Summary
Senate Bill 1978 would bar interconnections that could place the Texas grid under federal jurisdiction unless the PUC finds the interconnection consistent with free-market principles and not subject to FERC authority; resource witnesses pressed to retain the longstanding public-interest standard.
Senator Hall laid out Senate Bill 1978, which would prohibit actions that result in the interconnection of an electric facility in ERCOT to facilities outside the state if that interconnection would subject the Texas grid to Federal Energy Regulatory Commission (FERC) jurisdiction without a Public Utility Commission finding that the interconnection is consistent with free-market principles and will not bring federal control over the Texas grid.
The sponsor framed the measure as protecting the state’s independent grid and preventing federal oversight of ERCOT. Resource witnesses included Nathan Bigby, chief regulatory counsel with ERCOT, and Jaren Taylor representing Encore Electric Delivery. Witnesses and some senators raised technical and legal concerns about the bill’s structure:
- ERCOT's counsel and Encore Electric Delivery said the existing public-interest standard applied to interconnections and had been developed through precedent and protocols; in at least the version circulating to the committee the public-interest standard appeared struck and replaced by a "consistent with free-market principles" test. Witnesses asked that the public-interest standard remain in the bill or be restored in a committee substitute. - Senators and witnesses questioned whether the Public Utility Commission (PUC) has authority to determine, as a legal matter, whether a project would render ERCOT subject to FERC jurisdiction. Witnesses explained that FERC typically issues jurisdictional determinations and that disclaimers or waivers from FERC are the federal mechanism to clarify jurisdiction.
Witnesses urged maintaining the public-interest analysis and ERCOT protocols (including reliability and market-impact analysis) if the committee moves forward. The sponsor said an amendment/committee substitute was being drafted to restore the public-interest language; the committee left SB 1978 pending.
