2010-050 RES ENDORSING CERTAIN LEGISLATIVE CHANGES RELATING TO THE SUNSET REVIEWRESOLUTION NO. 2010-050
A RESOLUTION OF CITY COUNCIL OF THE CITY OF PARIS, TEXAS,
ENDORSING CERTAIN LEGISLATIVE CHANGES RELATING TO THE
SUNSET REVIEW OF THE TEXAS PUBLIC UTILITY COMMISSION AND THE
SPECIAL PURPOSE REVIEW OF THE ELECTRIC RELIABILITY COUNCIL OF
TEXAS; MAKING OTHER FINDIIVGS AND PROVISIOIVS RELATED TO THE
SUBJECT; AND DECLARING AN EFFECTIVE DATE.
WHEREAS, the City of Paris is a member of Cities Aggregation Power Project, Inc.
("CAPP"), a non-profit organization created by cities throughout Texas to secure affordable
energy for its members in the deregulated electric market; and
WHEREAS, affordable and reliable power means economic development for our
cities and a better standard of living for our citizens; and
WHEREAS, by deregulating the retail electric market, Senate Bill 7 of 1999 ("SB
7") intended to allow competitive forces to drive down the price of electricity; and
WHEREAS, CAPP's eight-year experience with the deregulated market, including
negotiating power contracts with several different retail electric providers, indicates that
the Texas electric retail market has failed to develop into a truly competitive market as
envisioned by the Texas Legislature; and
WHEREAS, competition has failed to develop in the deregulated electric market
because certain power generation companies own or control enough generation capacity to
exercise market power to the detriment of customers and non-affiliated retail electric
providers; and
WHEREAS, alleged market power abuse inquiries conducted by the Public Utility
Commission ("PUC") are hampered by the lack of adequate resources because the parties
hurt by the illegal activity, like cities, are not allowed to participate in the investigations;
and
WHEREAS, the managers at the Electric Reliability Council of Texas (ERCOT) have
failed to adequately manage expenses and operations. The most obvious example is
ERCOT's implementation of a nodal market - a project now four years behind schedule and
expected to cost at least eight times original estimates; and,
WHEREAS, the Sunset Review Commission is expected to recommend legislative
reforms for the PUC and ERCOT; and,
WHEREAS, the City supports all such legislative reforms that promote a truly
healthy electric market where competition can flourish and consumers can save money;
and
WHEREAS, the City endorses efforts proposed by CAPP to modify the electric
competition, implement the original intent of SB 7 and reduce costs to the City and its
residents.
NOW, THEREFORE, BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY OF
PARIS, TEXAS, THAT:
things.
Section 1. The findings set out in the preamble to this resolution are hereby in all
Section 2. The City urges reforming the PUC and ERCOT in such a way as to
enhance competition in the deregulated market, to promote consumer protection and to
encourage the sale of affordable electricity. Specifically, the City urges the Texas
Legislature, as it considers changes recommended by the Sunset Advisory Commi9ssion, to
adopt reforms consistent with the following:
• All generators, regardless of size, should explicitly be barred from the unlawful
exercise of market power.
• Entitles such as municipalities, commercial customers or retail electric providers
harmed by wholesale market abuse should be given explicit standing to
participate in market power abuse enforcement actions brought by the PUC.
• Fines should be increased for market abuses in such a way that the PUC can
order full restitution to the market, market participants, or parties injured by the
violation.
• Activities defined as market abuse by the Federal Energy Regulatory
Commission should be prohibited.
• The statutory purpose of the PUC should be modified to require it to harmonize
its pursuit of competition with the protection of consumers of electricity.
• As a condition of conducting business within Texas, a competitive Retail Electric
Providers (REPs) should be required to include among their offers one standard
electricity package that has PUC-approved terms and conditions.
• The number of consumer representatives on the ERCOT board should be
increased from the current three members to six.
• The Office of the Comptroller should be assigned a seat on the board as well as
on appropriate budget oversight panels within ERCOT. The Comptroller's office
should be given access to all ERCOT contracting material and be charged with
conducting a bi-annual performance review of ERCOT.
• The PUC should be required to pre-approve all debt financing by ERCOT.
Section 3. A copy of the resolution shall be sent to the elected lawmakers
representing the City's interests in the Texas House and Senate and to the Chairman and
legal counsel of CAPP.
Section 4. This resolution shall be effective immediately upon passage.
DULY PASSED AND APPROVED on this 26th day of April, 2010, by a vote of 7
ayes and _0 nays at a regular meeting of the City Coun~il of the City of Paris, Texas.
ATTEST:
,
al~
nice Ellis, City Clerk
APPROVED AS TO FORM:
W. Kent M y ' Attorney
se James/f reelen, Mayor