Texas Senate Bill SB 1978

Texas 2025 - 89th Regular

• Filed: 3/6/25
• Out of Senate Committee: 5/16/25
• Voted on by Senate: 5/21/25

Caption

Relating to the interconnection of a facility in the ERCOT power region to certain other facilities.

Summary

SB 1978 amends Section 37.051 of the Texas Utilities Code to change how facilities in the ERCOT power region may interconnect with facilities outside Texas or with facilities connected to outside-of-state systems. The bill keeps the general prohibition on interconnections that could link ERCOT to out-of-state facilities, but it creates a more detailed approval process under which an electric cooperative, utility, or other person must first seek a Public Utility Commission determination that the proposed interconnection is in the public interest. That determination must consider technical attributes, expected public costs, relevant commission criteria, reliability findings from ERCOT’s independent organization, and any other relevant information. The bill also requires that the proposed interconnection not subject ERCOT to additional federal control or jurisdiction, and it ties the state approval process to any related Federal Energy Regulatory Commission action. It preserves a special expedited approval path for a specific interconnection associated with the FERC settlement in Docket No. TX11-01-001 and the planned physical connection between the ERCOT and SERC regions. The bill clarifies that the commission and ERCOT’s independent organization may still adopt generally applicable rules and protocols, and it applies only prospectively to interconnections made on or after the effective date.

Impact

SB 1978 would affect the Public Utility Commission’s authority over ERCOT interconnections by adding a public-interest review framework and timing requirements before certain cross-border or cross-system interconnections can proceed. It amends the Utilities Code to limit when electric cooperatives, utilities, municipally owned utilities, and other persons may connect ERCOT facilities to facilities outside Texas or to facilities linked to outside-of-state systems, while preserving existing authority for cooperatives to build generation and necessary interconnection facilities without a certificate of public convenience and necessity. The bill also preserves a narrow, preexisting approval pathway for a specific ERCOT-SERC project and states that prior interconnections remain governed by the law in effect when they were made.

Sentiment

The bill appears to have been generally supported in the Senate, as reflected by passage on third reading by a 25-6 vote, though earlier procedural votes also show some opposition. The available record suggests the measure was treated as significant ERCOT policy legislation, with enough support to advance through the Senate and then be referred in the House to State Affairs. No committee transcript is available here, so the discussion-based sentiment cannot be assessed in detail, but the voting pattern indicates majority support alongside a notable minority of resistance.

Contention

The main point of contention is likely the extent to which Texas should allow ERCOT interconnections with facilities outside the state or linked to out-of-state systems, especially where such connections could increase federal oversight or affect grid independence. Opponents may be concerned that the bill could either facilitate broader interconnection or create new regulatory hurdles, depending on their policy preference, while supporters likely view the public-interest review and federal-jurisdiction safeguard as necessary protections for ERCOT reliability and state control. The special treatment for the TX11-01-001 settlement-related interconnection may also be a point of interest because it singles out a specific project for expedited approval.