Oncor Electric Delivery Co. v. Public Utility Commission of Texas (Opinion)Annotate this Case
In 2002, the Public Utilities Regulatory Act (PURA) implemented a competitive retail market for electricity in the Electric Reliability Council of Texas. Each incumbent, vertically integrated electric utility within the market was required to unbundle its business activities into separate units, including a transmission and distribution utility (TDU). Of the units, only TDUs continued to be regulated by the Public Utilities Commission (PUC). Here, several parties to a TDU ratemaking proceeding sought judicial review of the PUC’s order. The Supreme Court affirmed in part and reversed in part the judgment of the court of appeals, holding (1) PURA section 36.351, which requires electric electric utilities to discount charges for service provided to state college and university facilities, does not apply to TDUs; (2) former PURA section 36.060(a), which required an electric utility’s income taxes to be computed as though it had filed a consolidated return with a group of its affiliates eligible to do so under federal tax law, did not require a utility to adopt a corporate structure so as to be part of the group; and (3) the evidence in this matter established that franchise charges negotiated by the TDU with various municipalities were reasonable and necessary operating expenses under PURA section 33.008.