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Regulatory Overview

BTU a municipally owned electric utility is accountable for operating within the prescribed rules and regulations of:

  • Federal Energy Regulatory Commission (FERC) – The predecessor agency, the “Federal Power Commission” (FPC), founded in 1920 to coordinate federal hydropower development and sales of interstate electricity. In 1935 additional jurisdiction and independency from Congress was established and set forth an official “Uniform System of Accounts” as the standard accepted for reporting of electric and gas utility accounting and operations statistics. It is this system of accounts that BTU utilizes for accounting and reporting. In response to the energy crisis, Congress passed the DOE Organization Act in1977, consolidating various energy related agencies into a Department of Energy (DOE). The FPC was renamed the Federal Energy Regulatory Commission (FERC) preserving its independent status. The National The Energy Policy Act of 2005 gave FERC additional responsibilities to impose mandatory reliability standards on the bulk transmission system and to impose penalties on entities that manipulate electricity and natural gas markets including but not limited to:
    • Regulating interstate sales of electricity and natural gas.
    • Licenses and inspects private, municipal, and state hydroelectric projects.
    • Ensures the reliability of high voltage interstate transmission system.
    • Monitors and investigates energy markets.
    • Use of civil penalties and other means against energy organizations and individuals who violate FERC rules in the energy markets.
    • Administers accounting and financial reporting regulations.
  • North American Electric Reliability Corporation (NERC) – Established in 1968 following the “Northeast Blackout of 1965”, to ensure reliability of the bulk power system in North America. NERC is a non-government organization which FERC in 2007 delegated specific statutory responsibility to regulate bulk power system users, owners, and operators through the adoption and enforcement of standards for fair, ethical and efficient practices. NERC actively:
    • Monitors the bulk power systems.
    • Develops and enforces reliability standards.
    • Audits electric utility operations for compliance with reliability standards, rules, and procedures.
    • Has authority and may impose severe financial penalty for non-compliance.
    • And educates trains and certifies industry personnel.
  • Texas Reliability Entity (TRE) – To ensure compliance with NERC reliability standards among the utilities in the Electric Reliability Council of Texas (ERCOT), TRE monitors and enforces:
    • Actively monitors and reports compliance with NERC reliability standards.
    • Develops regional-specific reliability standards.
    • Monitors and reports compliance with ERCOT protocols to the PUCT.
  • Public Utility Commission of Texas (PUCT) – The mission of the PUCT is to protect customers, foster competition, and promote high quality infrastructure. The PUCT is responsible for but not limited to:
    • Regulating rates and terms of intra-state transmission and distribution service in areas where customer choice has been introduced.
    • Oversight of ERCOT through an Independent Market Monitor reviewing.
      • Electrical transaction reporting.
      • Energy transactions in “Real Time” and “Day-Ahead” Markets.
      • Capacity in “Real Time” and “Day-Ahead” Markets.
    • Adopting and enforcing rules relating to retail competition.
    • Licensing of retail electric providers and registration of power generation companies, power marketers, and aggregators.
    • Reviewing proposals for the construction of new transmission facilities.
  • Electric Reliability Council of Texas (ERCOT) – ERCOT formed in 1970, is one of eight Independent System Operators (ISO’s) in North America, manages the flow of electric power to 22 million Texas customers representing approximately 85% of the state’s electric load and about 75% of the Texas land area. Unlike the other major ISOs, the high voltage transmission and energy market within Texas is operated as a single power system instead of as a network of cooperating utility companies. ERCOT as the ISO for the region:
    • Schedules power on an electric grid that connects 40,000 miles of transmission lines.
    • Manages and coordinates more than 500 generation units in a manner consistent with established protocol.
    • Manages the financial settlement for the competitive wholesale bulk-power market.
    • Administers customer switching for 6.5 million Texans in competitive retail choice areas.

Regulatory Compliance Activities

BTU actively monitors and participates and responds to regulatory issues at the national, regional, state, and local levels. For example:

  • National Level
    • Participates as a member of the American Public Power Association (APPA), a non-profit trade association located in Washington DC that monitors daily legislative activity and alerts members regarding matters affecting them. BTU personnel have been active participants in various committees and training programs.
    • In 2009 implemented a “Compliance Management System” that defines the processes, responsibilities for compliance with the North American Electric Reliability Corporation (NERC) and the Texas Reliability Entity (TRE).
    • In 2010 establishes the position of “Regulatory Compliance Officer” to assure that compliance is achieved and maintained.
    • BTU Transmission operators receive specialized training and have completed NERC certifications.
  • Regional Level
    • The BTU Regulatory Compliance Officer and key staff monitor TRE proceedings and scheduled utility compliance audits.
    • BTU staff have been and many remain active named municipal segment voting participants in the ERCOT stakeholder process.
      • ERCOT Board of Directors: Dan Wilkerson, 2007 to 2009
      • ERCOT Technical Advisory Committee (TAC): Dan Wilkerson, 2003 to 2006
      • ERCOT Retail Market Subcommittee (RMS): Kean Register, 2002 to present
      • Reliability and Operations Subcommittee (ROS):
        • ROS Operations Working Group: Wayne Thomas, 2007 to present
        • Black Start Task Force: Michael Hering, 2004 to present
      • ERCOT Wholesale Market Subcommittee (WMS): Tom Hancock, 2003 to 2007 and Gary Miller, 2008 to present
        • QSE Managers Working Group: Gary Miller, 2004 to 2007 (working group chair 2005 to 2006) and Ken Lindberg, 2008 to present.
        • Verifiable Cost Working Group: Lori Williams, 2007 to present.
        • Market Credit Working Group: Lee Starr and Michael Mathews 2009 to present.
      • ERCOT Commercial Operations Procedures Subcommittee (COPS): Lee Starr, 2004 to present, (subcommittee chair 2007 to 2008).
        • COPS Settlements and Extract Working Group: Lori Williams, 2007 to present.
      • ERCOT, Board F and A Committee, Credit Working Group (CWG): Lee Starr, 2005 to present.
    • BTU Transmission operators receive specialized training and have completed NERC certifications.
  • Local Level – Responsible for the operations and oversight of the City of Bryan governmental services and operations for the citizens of Bryan. In 2001 the City of Bryan established the Bryan Texas Utilities (BTU) Administrative Board delegating the operational oversight and management of the City’s electric utility. The City Council retained
    • City of Bryan, City Council
      • Approval of the annual budget.
      • Approval of all rates and fee charges for electric service.
      • Approval of all matters related to financing.
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