This section sets how securitization under this subchapter works, gives an electric utility a limited right to apply for system-restoration bond financing, and requires the commission to protect customers when approving it.
Sec. 36.451. PURPOSE AND APPLICABILITY. (a) Except as otherwise specifically provided by this subchapter, the same procedures, standards, and protections for securitization authorized by Subchapter I of this chapter and, to the extent made applicable to Subchapter I of this chapter, by Subchapter G, Chapter 39, apply to the lower-cost financing mechanism for securitization of transition costs or system restoration costs as provided by Subchapter I. To the extent of any conflict between the provisions of this subchapter and Subchapter I of this chapter or, to the extent made applicable by Subchapter I of this chapter, Subchapter G, Chapter 39, in cases involving the securitization of system restoration costs under this subchapter, the provisions of this subchapter control. (b) The purpose of this subchapter is to make available a lower-cost, supplemental financing mechanism to allow an electric utility to obtain timely recovery of system restoration costs under Subchapter I through securitization and the issuance of transition bonds or system restoration bonds by an issuer other than the electric utility or an affiliated special purpose entity. Financing of system restoration costs under this subchapter is a valid and essential public purpose. (c) The Texas Electric Utility System Restoration Corporation is created under this subchapter as a special purpose public corporation and instrumentality of the state for the essential public purpose of providing a lower-cost, supplemental financing mechanism available to the commission and an electric utility to attract low-cost capital to finance system restoration costs. (d) In approving securitization under this subchapter, the commission shall ensure that customers are not harmed as a result of any financing through the Texas Electric Utility System Restoration Corporation and that any financial savings or other benefits are appropriately reflected in customer rates. (e) System restoration bonds issued under this subchapter will be solely the obligation of the issuer and the corporation as borrower, if applicable, and will not be a debt of or a pledge of the faith and credit of the state. (f) System restoration bonds issued under this subchapter shall be nonrecourse to the credit or any assets of the state and the commission. (g) This subchapter does not limit or impair the commission's jurisdiction under this title to regulate the rates charged and the services rendered by electric utilities in this state. (h) An electric utility receiving the proceeds of securitization financing under this subchapter is not required to provide utility services to the corporation or the state as a result of receiving such proceeds except in the role of the corporation or the state as a customer of the electric utility. This subchapter does not create an obligation of the corporation or an issuer to provide electric services to the electric utility or its customers. (i) Notwithstanding Section 36.403(j), an electric utility may apply for securitization and the issuance of system restoration bonds under this subchapter for estimated and actual system restoration costs of $50 million or more in any calendar year. Added by Acts 2021, 87th Leg., R.S., Ch. 198 (H.B. 1510), Sec. 2, eff. June 1, 2021. Amended by: Acts 2025, 89th Leg., R.S., Ch. 71 (S.B. 1963), Sec. 1, eff. September 1, 2025.