Desalination Bill Frees Data Center Power Sales From Utility Rules

The text as introduced · 547 words

By: Sparks
S.B. No. 2211

A BILL TO BE ENTITLED

AN ACT

relating to a qualifying cogenerator that serves a large load and a

colocated desalination facility.

BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:

SECTION 1. Section 31.002, Utilities Code, is amended by

amending Subdivision (13) to read as follows:

(13) "Qualifying cogenerator" and "qualifying small

power producer" have the meanings assigned those terms by 16 U.S.C.

Sections 796(18)(C) and 796(17)(D). A qualifying cogenerator that

provides electricity to a purchaser of the cogenerator's thermal

output is not for that reason considered to be a retail electric

provider or a power generation company. A qualifying cogenerator

includes an owner or operator of dispatchable generation that:

(A) provides thermal, steam or waste heat for use

by a co-located desalination facility; and

(B) serves a load whose primary purpose is the

manufacture of digital products.

SECTION 2. Subsection 37.001, Utilities Code, is amended by

amending Subdivision (3) to read as follows:

(3) "Retail electric utility" means a person,

political subdivision, electric cooperative, or agency that

operates, maintains, or controls in this state a facility to

provide retail electric utility service. The term does not include

a corporation described by Section 32.053 to the extent that the

corporation sells electricity exclusively at wholesale and not to

the ultimate consumer. A qualifying cogenerator that sells electric

energy at retail to the sole purchaser of the cogenerator's thermal

output under Sections 35.061 and 36.007 is not for that reason

considered to be a retail electric utility. The owner or operator of

a qualifying cogeneration facility who was issued the necessary

environmental permits from the Texas Natural Resource Conservation

Commission after January 1, 1998, and who commenced construction of

such qualifying facility before July 1, 1998, may provide

electricity to the purchasers of the thermal output of that

qualifying facility and shall not for that reason be considered an

electric utility or a retail electric utility, provided that the

purchasers of the thermal output are owners of manufacturing or

process operation facilities that are located on a site entirely

owned before September, 1987, by one owner who retained ownership

after September, 1987, of some portion of the facilities and that

those facilities now share some integrated operations, such as the

provision of services and raw materials. A person who is an electric

generation equipment lessor or operator is not for that reason

considered to be a retail electric utility. A person who owns or

operates equipment used solely to provide electricity charging

service for consumption by an alternatively fueled vehicle, as

defined by Section 502.004, Transportation Code, is not for that

reason considered to be a retail electric utility. The owner or

operator of a qualifying congenator as defined by Subdivision

31.002(13) is not considered to be a retail electric utility if the

owner or operator of a qualifying cogenerator is providing

electricity to a manufacturer of digital products and thermal,

steam, or waste heat to a colocated desalination facility.

SECTION 3. This Act takes effect immediately if it receives

a vote of two-thirds of all the members elected to each house, as

provided by Section 39, Article III, Texas Constitution. If this

Act does not receive the vote necessary for immediate effect, this

Act takes effect September 1, 2025.