TITLE 16. ECONOMIC REGULATION

PART 2. PUBLIC UTILITY COMMISSION OF TEXAS

CHAPTER 22. PROCEDURAL RULES

The Public Utility Commission of Texas (commission) adopts amendments to 16 procedural rules and repeals one rule in 16 Texas Administrative Code (TAC) Chapter 22. The commission adopts the following rules with changes to the proposed text as published in the October 3, 2025 issue of the Texas Register (50 TexReg 6397): §22.201, relating to Place and Nature of Hearings; §22.205, relating to Briefs; §22.207, relating to Referral to State Office of Administrative Hearings; §22.225, relating to Written Testimony and Accompanying Exhibits; §22.241, relating to Investigations; §22.244, relating to Review of Municipal Electric Rate Actions; §22.246, relating to Administrative Penalties; §22.261, relating to Proposals for Decision; §22.262, relating to Commission Action After a Proposal for Decision; §22.264, relating to Rehearing; §22.281, relating to Initiation of Rulemaking; and §22.282, relating to Notice and Public Participation in Rulemaking Procedures. These rules will be republished.

The commission adopts the following rules with no changes to the proposed text as published in the October 3, 2025 issue of the Texas Register (50 TexReg 6397): §22.204, relating to Transcript and Record; §22.221, relating to Rules of Evidence in Contested Cases; §22.228, relating to Stipulation of Facts; and §22.263, relating to Final Orders. These rules will not be republished.

The commission adopts one repeal with no changes to the proposed text as published in the October 3, 2025 issue of the Texas Register (50 TexReg 6397): §22.248, relating to Retail Public Utilities. This rule will not be republished.

Section 22.246 is a competition rule subject to judicial review as specified in PURA §39.001(e).

The commission received comments on the proposed rule from Entergy Texas Inc. (ETI); the Lower Colorado River Authority and LCRA Transmission Services (collectively, LCRA); the Office of Public Utility Counsel (OPUC); Oncor Electric Delivery Company LLC (Oncor); and The Texas Association of Water Companies, Inc. (TAWC).

General Changes

The adopted rules include various clerical and grammatical changes, as well as changes to outdated rules, statutes, or certain terms. Changes are also made to conform rules, where applicable, to the updated electronic filing requirements specified under §22.71, relating to Commission Filing Requirements and Procedures, and §22.72, relating to Form Standards for Documents Filed with the Commission, of this title.

Place and Nature of Hearings

Adopted §22.201 is revised to authorize virtual hearings if the presiding officer determines that it is in the public interest. Adopted §22.201 also authorizes the presiding officer to hold virtual prehearing conferences and requires in-person or virtual pre-hearing conferences at SOAH to be conducted in accordance with commission rules.

Transcript and Record

Adopted §22.204 is revised to omit reference to the commission setting rates for purchase of official transcript copies from the official reporter. Adopted §22.204 is also revised to establish that, following an objection to a change to the record, any change to the record may only be made as ordered by the presiding officer.

Briefs

Adopted §22.205 is revised to require briefs to conform to the formatting requirements for pleadings under §22.72 of this title. Adopted §22.205 requires briefs that exceed ten pages to include a table of contents with page numbers and authorizes the presiding officer to require parties to address certain issues or address issues in a specific order or format.

Referral to State Office of Administrative Hearings

Adopted §22.207 is revised to clarify that the utility division of SOAH will conduct prehearing conferences as well as hearings related to contested cases before the commission, other than a prehearing conference conducted by a commission administrative law judge (ALJ) or one or more commissioners. Adopted §22.207 is also revised to clarify that, at the time SOAH receives jurisdiction or as soon as is reasonably practicable thereafter, the commission will provide to the SOAH ALJ a list of issues or areas that must be addressed. Adopted §22.207 further clarifies that the commission may identify and provide to the SOAH ALJ additional issues or areas that must be addressed at any time.

Written Testimony and Accompany Exhibits

Adopted §22.225 is revised to establish that, unless otherwise ordered by the presiding officer, a witness offering written prefiled testimony must be sworn and be asked whether the written testimony is a true and accurate representation of what the testimony would be if the testimony were to be given orally at the time the written testimony is offered into evidence.

Investigations

Adopted §22.241 is revised to establish that the commission may at any time institute formal investigations on its own motion, or the motion of commission staff, into any matter within the commission's jurisdiction.

Review of Municipal Electric Rate Actions

Adopted §22.241 is revised to clarify that petitions for review of municipal electric rate actions require the printed or typed name, telephone number, street or rural route address, and if available, the email address and facsimile transmission number of each signatory

Administrative Penalties

Adopted §22.246 is revised to effectuate changes to the distribution of disgorged excess revenues in the electric wholesale market by the independent organization. Specifically, adopted §22.246 is revised omit language allocating load of wholesale electric market participants that are no longer active prior to the calculation of load proportions to still-active market participants. Adopted §22.246 is also revised to authorize the commission to, upon a determination that other wholesale electric market participants are affected or a different distribution method is appropriate, direct the independent organization to distribute the excess revenue to affected wholesale market participants using a different distribution method in the same or subsequent proceeding.

Final Orders

Adopted §22.263 is revised to establish that parties will be notified of a commission final order as required by APA and §22.74 of this title, relating to Service of Pleadings and Documents, to the extent that provision does not conflict with the APA.

Initiation of Rulemaking

Adopted §22.281 is revised to clarify that rulemaking petitions that do not comply with the section, such a filing will be construed as a policy recommendation and not as a petition for rulemaking under the APA or the commission rule. Adopted §22.281 is also revised to establish that commission staff will open a general project for rulemaking petitions and post the control number on the commission's website, including procedures for administration of such petitions by commission staff and default deadlines for comment. Adopted §22.281 is further revised to authorize commission staff to host workshops or publish questions for comment, or draft rule language without express direction from the commission.

Notice and Public Participation in Rulemaking Procedures

Adopted §22.282 is revised to clarify the process for the solicitation of informal comments on commission rulemakings prior to initiating a formal rulemaking under the APA. Adopted §22.282 is also revised to authorize commission staff to, after a formal rulemaking has been initiated but prior to adoption, extend comment or public hearing request deadlines, request reply comments, or provide additional comment filing instructions in a rulemaking project. Adopted §22.282 is further revised to authorize the commission to consider a staff rulemaking recommendation or take action on a rulemaking even if commission staff does not file its final recommendation at least seven days prior to the open meeting where the rulemaking is scheduled to be considered.

General Comments

Internal cross-references to commission rules

OPUC recommended that internal cross-references to other commission rules refer to the applicable chapter of the Texas Administrative Code, rather than the overall title (i.e., "§ 22.74 of this title" should be revised to "§ 22.74 of this chapter." OPUC stated the applicable title for commission rules would be "Title 16, Economic Regulation" and therefore include rules of at least six different State of Texas agencies. OPUC noted that "of this chapter" is the correct reference in most instances, as that would refer to Chapter 22, under Part 2 of Title 16 which is the appropriate reference.

Commission response

The commission declines to implement the recommended change. Across the Texas Administrative Code there may be several instances of a specific chapter. For instance, "Chapter 22" appears in Title 1, Title 4, Tile 13, Title 16, Title 19, Title 28, and Title 43. The reference to "Title 16" is intended to ensure the Chapter 22 that is applicable to the commission rules. For this reason, the usage of "of this title" is common practice among Texas state agencies (e.g., Title 16, Part 1, Chapter 3 of the Texas Railroad Commission's rules and Title 30, Part 1, Chapter 290 of the Texas Commission on Environmental Quality's rules both use the phrase "of this title" over 200 times and "of this chapter" less than five times).

Usage of the terms "shall" vs. "must"

OPUC recommended that the term "shall" be preserved across the Chapter 22 rules, rather than be replaced with specific instances of "must" or "will," unless otherwise appropriate to do so in accordance with the Texas Code Construction Act. OPUC maintained that the Legislature intentionally used the term "shall" when drafting the statutes that underpin the commission's rules, even as recently as the last legislative session. Accordingly, if the Legislature had meant to use a different term, then it would have done so explicitly. OPUC further contended that the Texas Code Construction Act provides clear, separate definitions of "shall" and "must" and therefore the terms are not interchangeable. OPUC noted that if the Legislature intended the terms to be interchangeable, then it would have clearly stated that in the same manner that "may not" and "shall not" are. OPUC also commented that "shall" is not an antiquated term, given that other current bodies of law--such as the Texas Rules of Civil Procedure, Texas Disciplinary Rules of Professional Conduct, and Texas Code of Judicial Conduct--all use the term "shall."

Commission response

The commission declines to implement the recommended change. The commission acknowledges the general applicability of the TCCA to the commission's rules. See Texas Government Code §311.002(4) (applying the TCCA to "each rule adopted under a code"). However, forgoing use of the term "shall" or replacing the term with "may," "must," or another contextually relevant term is appropriate and not inconsistent with the TCCA. As indicated by OPUC, the TCCA does separately indicate a specific construction for the terms "may," "shall," "must," and "may not" under Texas Government §311.016(1)-(3) and (5). However, the statute also establishes that: "[t]he following constructions apply unless the context in which the word or phrase appears necessarily requires a different construction or unless a different construction is expressly provided by statute." This provision indicates a general level of flexibility in usage and interpretation of various modal verbs. More importantly, the TCCA does not require the usage of "shall" as opposed to "must" or "may" when implementing statutes in agency rules. Therefore, the commission is not prohibited by law from utilizing other modal verbs to replace "shall." Lastly, commenters have not identified instances where the usage of a different modal verb has resulted in ambiguity as to the intended meaning.

Proposed §22.201 - Place and Nature of Hearings

Proposed §22.201 establishes the form and manner for hearings held at the commission and at the State Office of Administrative Hearings (SOAH).

Proposed §22.201(a) and §22.201(b) - Commission-held hearings and Hearings held at SOAH

Proposed §22.201(a) establishes that all commission-held hearings will be held in person and in Austin, unless the commission determines that it is in the public interest to hold a hearing elsewhere or virtually. The provision further authorizes the presiding officer to issue a written order authorizing a prehearing conference to be conducted virtually. Proposed §22.201(b) establishes that a hearing held at SOAH will be conducted in accordance with commission rules.

LCRA recommended that proposed §22.201(a) be revised to add more specific conditions for the authorization of virtual hearings to ensure such hearings are held upon request and in appropriate circumstances. Specifically, LCRA recommended virtual hearings held at the commission be additionally conditioned upon the motion of a party and a subsequent commission determination that good cause exists to hold a virtual hearing. LCRA provided draft language consistent with its recommendation. Similar to its recommendation for proposed §22.201(a), LCRA also recommended that proposed §22.201(b) be revised to add a condition that virtual hearings held at SOAH be based upon a determination by the presiding officer that good cause exists to hold a virtual hearing. LCRA provided draft language consistent with its recommendation.

Commission response

The commission declines to implement LCRA's recommended changes as they are unnecessary. The form and manner of a commission-held hearing should be left to the discretion of the commission and, as applicable, SOAH.

OPUC recommended proposed §22.201(a) be revised to require the agreement of all parties as a prerequisite to holding a virtual hearing or virtual prehearing conference. OPUC further recommended proposed §22.201(a) be revised to authorize virtual hearings only to the extent a virtual hearing does not preclude a party's right to be heard in person under PURA §14.056. OPUC expressed concern that virtual hearings could "preclude in-person hearings over the objection of one or more intervenor rate payers because it is deemed to be in the 'public interest.'" OPUC acknowledged that virtual hearings may save avoidable litigation expenses such as travel costs, including rate case expenses that would otherwise be passed on to ratepayers. Therefore, virtual hearings should be conditioned upon the agreement of all the parties. OPUC provided draft language consistent with its recommendation.

Commission response

The commission declines to implement the recommended change because it is unnecessary. The first sentence in §22.201(a) already authorizes the commission to hold virtual hearings as a general matter. Moreover, PURA §14.056 neither prohibits the commission from holding a virtual hearing nor does it require agreement by all the parties for such prehearing conferences to be held. The statute provides: "[e]ach party to a proceeding before a regulatory authority is entitled to be heard by attorney or in person" and has been in PURA since at least 1995, prior to the innovation of virtual hearings. As such, the provision does not prohibit the holding of hearings virtually; it only provides the right for parties to participate in commission proceedings with or without an attorney. Stated differently, it ensures public participation by allowing pro se individuals to participate in commission proceedings.

OPUC recommended proposed §22.201(b) be revised to authorize virtual prehearing conferences. OPUC stated that currently the majority of prehearing conferences at SOAH are held virtually. OPUC stated that in Project No. 58400, the commission proposed to define the term "hearing" as "[a]ny proceeding at which evidence is taken on the merits of the matters at issue, not including prehearing conferences" and the term "prehearing conference" as "[a]ny conference or meeting of the parties, prior to the hearing on the merits, on the record and presided over by the presiding officer." OPUC explained that if those separate definitions are adopted, then not including prehearing conferences in proposed §22.201(b) could "inadvertently preclude SOAH from continuing to hold those proceedings virtually." The commission notes that these definitions have since been adopted as proposed in Project No. 58400. OPUC provided draft language consistent with its recommendation.

Commission response

The commission implements OPUC's recommended change for clarity.

New §22.201(c)

OPUC recommended that a new subsection §22.201(c) be added to the rule which would authorize the holding of "paper" hearings only upon the agreement of all parties and "to allow evidence and briefing to develop the record." OPUC stated that proceedings may sometimes be sufficiently litigated through briefings and occur frequently enough such that they should be addressed in commission rules. OPUC stated that articulating this practice in rule language would provide the presiding officer flexibility and a clear authorization to conduct such a hearing if the parties agree on a case-by-case basis that the evidence and circumstances warrant it. OPUC further noted that paper hearings generally save ratepayers money because the appearance of the parties and any witnesses is not required, either in-person or virtually. Paper hearings also reduce the overall time to conduct the case. OPUC provided draft language consistent with its recommendation.

Commission response

The commission declines to implement the recommended change because it is unnecessary and ambiguous. The term "paper hearing" is not a defined term and PURA does not require agreement by all of the parties to forgo a hearing. Moreover, §22.201(a) leaves discretion to the commission as to whether a hearing should be held in-person or virtually.

Proposed §22.204 - Transcript and Record

Proposed §22.204 establishes the procedures for preparing, purchasing, correcting, and filing of stenographic records of commission proceedings. The provision also requires such records to include the items specified by the Texas Administrative Procedure Act (APA).

Proposed §22.204(b) - Purchase of Copies

Proposed §22.204(b) establishes that a party may purchase a copy of the transcript from the official reporter.

OPUC recommended that proposed §22.204(b) be revised to require proceeding transcripts to be provided to commission staff and OPUC free of charge upon request. OPUC stated that this addition would help save taxpayer funds. Specifically, the addition would reduce litigation costs for OPUC when representing residential and small commercial customers before the commission. OPUC noted that it is a taxpayer-funded state agency. OPUC provided draft language consistent with its recommendation.

Commission response

The commission declines to implement the recommended change. It is not apparent that the commission has the legal authority to require proceeding transcripts free of charge from a contracted court reporter.

Proposed §22.205 - Briefs

Proposed §22.205 establishes the form requirements for legal briefs filed with the commission, including attachments, tables of contents, and citations to legal authorities that are not readily accessible.

Proposed §§22.205(a), 22.205(a)(1), 22.205(a)(1)(A), and 22.205(a)(1)(B) - Brief formatting requirements

Proposed §22.205(a) requires briefs to, where practicable, conform with the formatting requirements for pleadings under §22.72, relating to Form Requirements for Documents Filed with the Commission. Proposed §22.205(a)(1) requires briefs to not exceed 35 pages including citations without attachments unless the presiding officer or commission counsel provides otherwise. Proposed §22.205(a)(1)(A) permits briefs to include up to an additional 50 pages of attachments, but may not exceed a total of 75 pages with citations and attachments. Proposed §22.205(a)(1)(B) requires briefs in excess of ten pages to contain a table of contents with page numbers stated.

Oncor, LCRA, ETI, and TAWC opposed establishing maximum page limits for briefs in proposed §§22.205(a)(1), 22.205(a)(1)(A), and 22.205(a)(1)(B). Commenters emphasized that the benefits of page limits would be outweighed by the costs of limiting discussion in commission proceedings with an expansive evidentiary record that are highly contested. Oncor and LCRA recommended that any page limit should be established by the presiding officer or commission counsel on a case-by-case basis. Oncor and LCRA specifically recommended proposed §22.205(a)(1) and §22.205(a)(1)(A) be deleted but did not oppose retaining the table of contents requirement under proposed §22.205(a)(1)(B). Oncor further recommended that if the presiding officer declines to address briefing page limits, then the default should be that there are no page limitations for briefs in that case. Oncor stated that otherwise the rule may result in page limits that are inadequate for some proceedings or may otherwise incentivize unnecessarily longer briefs in other proceedings that do not warrant it. Oncor emphasized that providing a page limit for briefs in commission rules is unnecessary and that any page limit should be based on case-specific criteria that influence the appropriate level of content such as the number of parties, the number of contested issues, and whether those issues are based in law or fact. LCRA emphasized that fixed page limits are arbitrary and impractical in complex, multi-issue proceedings where the applicant bears the burden of proof. LCRA stated that in multi-issue proceedings, initial and reply briefs frequently exceed 100 pages due to the number and complexity of issues, the volume of evidence, and "the [APA] requirement to present a reasoned analysis that supports agency decision-making and withstands judicial review." LCRA noted that the page count for reply briefs is particularly difficult because of the uncertainty inherent to such filings. Specifically, reply briefs are dependent "upon the arguments, authorities, and factual assertions raised by other parties, as well as the number of intervenors and the breadth of issues they inject into the case." LCRA stated that prescribing brief page limitations by rule risks "the clarity and completeness of party submissions" that weakens the development of a "robust and defensible administrative record" and may lead to further unnecessary litigation due to the exclusion or oversimplification of issues. LCRA remarked that current commission rules and the presiding officer's authority to manage proceedings are already sufficient to ensure that briefs are of a sufficient length without risking administrative efficiency. LCRA provided draft language consistent with its recommendation. ETI recommended that if the commission imposes a page limit, then proposed §22.205(a)(1) should be revised to state that the page limit should be no less than 50 pages. ETI noted that utilities frequently request good cause exceptions to the existing rule provision that limits briefs to 50 pages. TAWC recommended that exceeding the page limit should be allowed for good cause or otherwise the rule should allow briefs to exceed 35 pages if they include attachments and citations. TAWC provided draft language consistent with its recommendation.

Commission response

The commission agrees with commenters and omits the page limits for briefs under §22.205(a)(1) and §22.205(a)(1)(A) and restructures the provision accordingly. The commission has general authority under §22.72(f) to establish different page limits in any proceeding if necessary. Section 22.71(f) also authorizes commission counsel or the presiding officer to establish page limits for filings in a proceeding with an assigned tariff or docket control number.

Oncor recommended that if the page limit requirement is preserved, then proposed §22.205(a)(1)(A) should be revised to increase the maximum page limits authorizing the presiding officer to modify the page limits for attachments. Oncor observed that the proposed page limits are insufficient for many cases, such as rate proceedings, and that the proposed language only contemplates the presiding officer modifying the page limits for briefs, not the attachments. OPUC similarly recommended that the page limits not apply to cover pages, tables of contents, signature pages or certificates of service. OPUC stated the additional language would provide a clear standard as to what is and is not included in the page limits for briefs and promote administrative efficiency as it establishes clear expectations that would assist parties or intervenors that are unfamiliar with commission or SOAH proceedings. OPUC noted that its proposed language is similar to the language utilized by the Texas Rules of Appellate Procedure. OPUC provided draft language consistent with its recommendation.

Commission response

The commission agrees with Oncor and OPUC but declines to implement the recommended changes because they are moot. As stated previously, the commission omits the page limits for briefs under §22.205(a)(1) and §22.205(a)(1)(A).

New §22.205(c)

OPUC recommended that new §22.205(c) be added to the rule that would authorize a party to move to extend the page limit for briefs. The new provision would require the presiding officer to rule on the motion within five days of the filing, otherwise the request would be deemed granted. OPUC stated the five-day deadline for the presiding officer to rule on the motion would provide certainty to parties as to whether their motion has been granted and therefore ensure that their filed briefs comply with the appropriate page limit requirements. OPUC further remarked that its proposed language is similar to the Texas Rules of Appellate Procedure. OPUC provided draft language consistent with its recommendation.

Commission response

The commission declines to add the recommended provision because it is moot. As stated previously, the commission omits the page limits for briefs under §22.205(a)(1) and §22.205(a)(1)(A).

Proposed §22.207 - Referral to State Office of Administrative Hearings

Proposed §22.207 establishes the procedure and requirements associated with the commission's referral of contested case proceedings to the utility division of SOAH.

Proposed §22.207(a) and §22.207(a)(1) - Prehearing conferences and hearings held by SOAH

Proposed §22.207(a) establishes that the utility division of SOAH will conduct prehearing conferences and hearings related to contested cases before the commission, other than a prehearing conference conducted by a commission administrative law judge or a hearing conducted by one or more commissioners. Proposed §22.207(a)(1) establishes that the commission will provide to the SOAH administrative law judge a list of issues or areas that must be addressed.

Oncor and LCRA opposed the deletion of the phrase "at the time SOAH receives jurisdiction of a proceeding" from proposed §22.207(a)(1) and recommended it be retained. Oncor and LCRA explained that the deletion of the phrase would leave the timing for providing the list of issues to SOAH open-ended and therefore delay the issuance of preliminary orders. In turn, this would increase the time between final resolution at SOAH and the commission's final order. Oncor and LCRA emphasized the importance of timely referring and scoping commission proceedings to SOAH to ensure all relevant issues are promptly addressed. LCRA further stressed the importance of proper timing to ensure statutory deadlines are met and material issues are addressed, particularly in complex and multi-party cases where even short delays can have cascading negative effects. LCRA stated that preserving the existing language provides clarity and helps avoid disputes over scoping by ensuring a list of issues is provided to SOAH contemporaneously with referral. LCRA provided draft language consistent with its recommendation.

Commission response

The commission declines to implement the recommended changes. Preliminary orders are not always filed at the time SOAH receives jurisdiction of a commission matter. Moreover, supplemental preliminary orders are often filed long after the case has been referred to SOAH. For clarity, the commission revises §22.207(a)(1) to reflect that the commission will issue a preliminary order at the time of referral or as soon as is reasonably practicable thereafter.

Proposed §22.207(b) - Jurisdictional deadlines

Proposed §22.207(b) authorizes the commission to specify the length of time prior to the expiration of a jurisdictional deadline by which the SOAH administrative law judge will issue a proposal for decision to give the commission sufficient time to consider a proposal for decision.

OPUC recommended proposed §22.207(b) be revised to state that the commission will direct SOAH to issue a proposal for decision (PFD) within 30 days from the close of the evidentiary record in expedited proceedings. OPUC defined expedited proceedings as (1) proceedings with a deadline of 100 days or less from the start of the proceeding or (2) proceedings with a deadline that begins when an application is deemed administratively complete. OPUC commented that currently, SOAH administrative law judges have indicated "that in any contested case, the ALJ needs 60 days from the date the evidentiary record closes to issue a proposal for decision." However, in certain proceedings, the time allotted by statute for those proceedings is "consumed by the days given to SOAH to issue the PFD, eroding the effectiveness and participatory rights of intervenors and weakening the efficacy of their review of the application." OPUC maintained that, for expedited proceedings, the 60-day timeline imposed by SOAH is "inappropriate and robs parties of the ability to fully litigate their case." OPUC further stated that SOAH's 60-day timeline is not authorized by statute. Therefore, the commission should require SOAH to issue a PFD in expedited proceedings within 30 days. OPUC provided draft language consistent with its recommendation.

Commission response

The commission acknowledges OPUC's concerns but declines to implement the recommended change because it is out of scope.

Proposed §22.221 - Rules of Evidence in Contested Cases

Proposed §22.221 establishes the rules of evidence in contested cases before the commission, including the applicability of the Texas Rules of Evidence, rules of privileges and exemption recognized by Texas law, objections, formal exceptions, and public comment.

New §22.221(f)

OPUC recommended new §22.221(f) be added that would require statements of position filed under §22.124(a)(1) will be included as part of the evidentiary record. OPUC maintained that prefiled direct testimony and statements of position are the two main avenues for pro se residential intervenors to meaningfully participate in commission proceedings. OPUC commented that statements of position should be included in the evidentiary record despite some statements of position having been historically "excluded from the evidentiary record as they are not open to cross-examination." OPUC explained that statements of position are not meant to be testimony open for cross-examination and instead allow individual ratepayers to present their position to the presiding officer and meaningfully participate in commission proceedings. OPUC provided draft language consistent with its recommendation.

Commission response

The commission declines to implement the recommended change. If a party wishes for a statement of position to be part of the evidentiary record, the party may move for its admission, and other parties may object as appropriate. Statements of position should not be provided an elevated status as automatic evidence over other forms of evidence in a proceeding. Additionally, other parties do not have the opportunity to rebut or respond to statements of position given their short filing deadline. The proposed revision would effectively function as a workaround to filing testimony and would allow testimony to avoid rebuttal testimony from being filed against their position.

Proposed §22.225 - Written Testimony and Accompanying Exhibits

Proposed §22.225 establishes the form, procedural, and timing requirements associated with the filing of written testimony and exhibits with the commission, including the prefiling of testimony, exhibits, objections, and rebuttal testimony. The provision also establishes requirements associated with the supplementation, tender and service, and withdrawal of such filings.

Proposed §22.225(a) and §22.225(a)(1) - Prefiling of testimony, exhibits, and objections; Prefiling of witness and deposition testimony and discovery responses

Proposed §22.225(a) establishes the requirements associated with the prefiling of testimony, exhibits, and objections. Proposed §22.225(a)(1) requires that written direct and rebuttal testimony and accompanying exhibits of each witness must be prefiled unless otherwise ordered by the presiding officer upon a showing of good cause. The provision further requires deposition testimony and responses to requests for information by an opposing party that an intervenor or commission staff plans to introduce as part of its direct case must be filed at the time the intervenor or commission staff files its written direct testimony.

Oncor requested clarification on the rationale behind replacing the phrase "a party" with the phrase "intervenor or commission staff" and noted that the impact of the proposed change is unclear. Oncor stated that presumably an applicant is still permitted, but nor required to, "attach pertinent discovery responses or deposition testimony to its direct testimony." Oncor requested that if that is not the intention of the proposed language, then the commission provide clarity on the meaning and rationale of the proposed change. Oncor recommended that all parties be permitted to attach deposition testimony and discovery responses to their testimony. Oncor noted that there are some proceedings where the applicant who is a party to the case, but not necessarily an intervenor or commission staff, files its direct testimony with its application at the outset "such that the applicant would not have any discovery responses or deposition testimony from that proceeding to attach to its direct testimony." However, Oncor indicated there are other proceedings where an applicant seeking relief will not file its direct testimony until later in the proceeding where discovery could potentially occur if necessary. Oncor presumed that in such proceedings, an applicant would still be permitted, but not be required, to attach any relevant discovery responses or deposition testimony to its direct testimony despite the proposed rule change.

Commission response

The intention of the change was to reflect the fact that applicants or petitioners must file their direct testimony prior to discovery. However, the commission agrees with Oncor that the proposed language could cause confusion and therefore reverts to the original language. Specifically, both references to "intervenor or commission staff" in §22.225(a)(1) are revised back to "party."

Proposed §22.225(a)(2) - Cross-examination documents

Proposed §22.225(a)(2) establishes that a party is not required to prefile documents intended for use during cross-examination except that the presiding officer may require parties to identify documents that may be used during cross examination if necessary for the orderly conduct of the hearing.

Oncor opposed the deletion of §22.225(a)(2) and recommended the language be preserved "to promote judicial economy." Oncor explained that preserving the language would allow the presiding officer and all other parties to the proceeding to be contemporaneously aware of and able to review all material supporting rebuttal testimony in the same place. Oncor emphasized if the commission maintains the proposed changes to §22.225(a)(1), then there is a need to require parties, or at least intervenors and commission staff, "to file such deposition testimony and RFI responses supporting rebuttal testimony at the same time the rebuttal testimony is filed.

Commission response

The commission agrees with Oncor and preserves existing §22.225(a)(2) in the adopted rule. The commission also renumbers the following paragraphs as appropriate.

Proposed §22.225(a)(5) and §22.225(a)(5)(B) - Prefiled testimony schedule for major rate proceedings

Proposed §22.225(a)(5) establishes the requirements for the prefiled testimony schedule in a major rate proceeding. Proposed §22.225(a)(5)(B) requires other parties in the proceeding to prefile written testimony and exhibits according to the schedule set forth by the presiding officer. The provision also establishes that commission staff representing the public interest may not be required to file earlier than seven days prior to a hearing except for good cause shown or upon agreement of the parties.

LCRA recommended that language in proposed §22.225(a)(5)(B) that authorizes commission staff to file prefiled testimony as late as seven days before a hearing should be deleted. LCRA stated such an authorization does not conform to current standard practice and is disruptive to the "orderly processing of contested cases." LCRA indicated that typically procedural schedules require commission staff to submit testimony after receipt of direct testimony from intervenors but in advance of a hearing. This timeline provides sufficient time for applicants to prepare rebuttal testimony, for parties to file objections to rebuttal testimony, and applicants to file responses to such objections as well as any prehearing submissions. LCRA commented that a presumptive floor that commission staff "cannot be required to file earlier than seven days before hearing compresses or displaces downstream deadlines, risks prejudice to other parties and is inconsistent with schedules needed to develop a fair and complete record." LCRA provided draft language consistent with its recommendation.

Commission response

The commission declines to implement the recommended change. Generally, parties are directed by SOAH to confer and agree on a procedural schedule which includes testimony deadlines which renders LCRA's concerns moot in most instances. In specific cases, such as complaints or proceedings with a high level of pro se intervenors, commission staff may need to submit testimony later in the proceeding as part of its role in representing the public interest. In such instances, the good cause exception to the filing deadline is appropriate to ensure commission staff has flexibility in fulfilling that role.

OPUC recommended proposed §22.225(a)(5)(B) be revised to make explicit that prefiled written testimony and exhibits must be filed in accordance with §22.225. OPUC further recommended that staff's deadline to file prefiled written testimony and exhibits be extended from seven days to 14 days prior to a hearing. OPUC stated the extended time period provides other parties "sufficient time to review the evidence, assess the arguments in the testimony, and prepare for questions for and rebuttal to the testimony." OPUC provided draft language consistent with its recommendation.

Commission response

The commission declines to implement the recommended change. As stated previously, the seven-day deadline is necessary to ensure commission staff has flexibility in fulfilling its role representing the public interest. Moreover, in most case testimony deadlines operate according to a procedural schedule set by the presiding officer, so the default schedule is unlikely to apply except in specific situations.

Proposed §22.225(a)(5)(C) - Scheduling of rebuttal testimony

Proposed §22.225(a)(5)(C) provides that the presiding officer will establish dates for filing of rebuttal testimony.

OPUC recommended proposed §22.225(a)(5)(C) be revised to require the presiding officer to establish dates for intervenor and commission staff to file direct testimony in addition to the parties to file rebuttal testimony. OPUC stated that by providing explicit direction to intervenors and commission staff in the rule, it would provide clarity to the provision and facilitate the timely filing of testimony, particularly when the case involves pro se intervenors. OPUC provided draft language consistent with its recommendation.

Commission response

The commission declines to implement the recommended change because it is unnecessary. Specifically, §22.225(a)(6)(C) establishes that the presiding officer will establish dates for filing rebuttal testimony.

Proposed §22.225(a)(6) - New electric transmission facility certificate of convenience and necessity (CCN) applications

Proposed §22.225(a)(6) requires utilities filing a CCN application or CCN amendment for a new electric transmission facility to file written testimony and exhibits supporting its direct case on the same date that the application is filed with the commission.

TAWC recommended proposed §22.225(a)(6) be revised to explicitly state that the provision only applies to electric CCN cases because prefiled testimony is not required for water or sewer CCN applications. TAWC explained that neither Chapter 13 of the Texas Water Code, commission rules, nor the water or sewer CCN application form require such filings with an application. TAWC commented that this practice should continue and therefore the rule should explicitly exclude water or sewer CCN cases from such a requirement.

Commission response

The commission declines to implement the recommended change because it is unnecessary. Specifically, §22.225(a)(7) already explicitly applies to a new electric transmission facility and is therefore unrelated to CCNs under Chapter 13 of the Texas Water Code.

New §22.225(a)(10) and §22.225(a)(11)

OPUC recommended adding new §22.225(a)(10) which would require Class A, B, and C water and sewer utilities to file written testimony and exhibits supporting their direct cases on the same date a statement of intent to change rates is filed with the commission. The provision would also require the presiding officer to establish a prefiled testimony schedule. OPUC indicated that the revision would address ambiguity in commission rules, help make prefiled testimony more comprehensive and promote efficient commission review of the rate application. OPUC similarly recommended adding new §22.225(a)(11) to "close a potential loophole in the phrasing of TWC § 13.187 resulting from Senate Bill 740" from the 89th Legislative Session. The revision would require an applicant water or sewer utility to file written testimony and exhibits supporting its direct case on the same date it files its system improvement charge (SIC) application with the commission. OPUC stated the addition of its recommended provision would enable SIC applications to be processed on the expedited timeline as specified by the Legislature. OPUC noted that if its proposed revision concerning "major rate proceeding" is adopted in Project No. 58400 concerning the definition of "major rate proceeding" then this change is unnecessary. OPUC provided draft language consistent with its recommendations.

Commission response

The commission declines to implement the recommended change because it is out of scope. OPUC's proposed language represents a significant and substantive change to current practice in water and sewer rate proceedings that would necessitate further review by the commission and comment by interested stakeholders. Moreover, a SIC is an interim and expedited rate proceeding for which a statement of intent to change rates is not required under existing §24.76, relating to System Improvement Charge. Additionally, revisions to §24.76 to implement Senate Bill 740 are currently being implemented in Project No. 58391. The commission further notes that OPUC's proposed revision for the term "major rate proceeding" under §22.2(25), relating to Definitions, was not implemented in Project No. 58400.

New §22.225(a)(12)

OPUC recommended new §22.225(a)(12) be added, which would require non-ERCOT utilities to file written testimony and exhibits on the same date they file a CCN application to add transmission or generation infrastructure. OPUC stated the revision would mirror the proposed requirement for ERCOT utilities to do the same. OPUC maintained that the new provision would help ensure ratepayers inside and outside of ERCOT have the capability to fully participate in utility proceedings.

Commission response

The commission declines to implement the recommended change because it is out of scope. OPUC's proposed language represents a significant and substantive change to the proposed rule that would necessitate further review by the commission and comment by interested stakeholders, particularly the non-ERCOT utilities.

Proposed §22.225(b) - Admission of prefiled testimony

Proposed §22.225(b) establishes the general requirements applicable to the admission of prefiled testimony with the commission.

TAWC recommended proposed §22.225(b) be revised to authorize SOAH ALJs to admit prefiled testimony without having witnesses appear to swear to their testimony. TAWC stated that in some instances SOAH ALJs have elected to admit all prefiled testimonies and exhibits prior to presentation of a party's case and witnesses for cross-examination in a hearing on the merits. Therefore, the rule should codify this practice for administrative efficiency. TAWC provided draft language consistent with its recommendation.

Commission response

The commission agrees with TAWC and implements the recommended change.

Proposed §22.244 - Review of Municipal Electric Rate Actions

Proposed §22.244 establishes the requirements for petitions for commission review of municipal electric rate actions.

Proposed §22.244(a) and §22.244(a)(2) - Contents of petition and contact information

Proposed §22.244(a) establishes the minimum requirements for petitions for commission review of municipal electric rate actions filed under PURA §33.052 or §§33.101 - 33.104, in addition to any information required by statute. Proposed §22.244(a)(2) provides the list of contact information each signatory to the petition must provide including name, telephone number, address, and facsimile transmission number (i.e., fax number), if available.

OPUC recommended fax numbers be maintained as a method of contact for petitions for review of municipal rate actions under proposed §22.244(a)(2). OPUC also recommended proposed §22.244(a)(2) be revised to add e-mail as a method of communication. OPUC stated that some members of the public may still use fax numbers. Therefore, to maximize public participation, both methods of communication should be reflected in the adopted rule.

Commission response

The commission adopts OPUC's proposed language with slight modifications. Specifically, the commission revises the provision to require "[t]he printed or typed name, telephone number, street or rural route address, and if available, the e-mail address and facsimile transmission number of each signatory…." The revision is to ensure that the inclusion of a signatory's e-mail address or fax number is optional for purposes of the petition if such information is unavailable.

Proposed §22.246 - Administrative Penalties

Proposed §22.246 addresses enforcement actions related to the assessment of administrative penalties by the commission or the disgorgement of excess revenues by order of the commission.

Proposed §22.246(f), §22.246(f)(2), and §22.246(f)(2) - Report of violation or continuing violation

Proposed §22.246(f) authorizes the executive director to issue a report if the executive director determines that a violation or a continuing violation has occurred based on the investigation undertaken in accordance with §22.246(e). Proposed §22.246(f)(2) establishes the requirements for notices of reports issued by the executive director. Proposed §22.246(f)(2)(A) provides that the executive director will give written notice of the report to the person who is alleged to have committed the violation or continuing violation which is the subject of the report within 14 days after the report is issued. The provision also requires the notice to be given by regular, certified mail, or email to the mailing address or email address maintained in the commission's records. The provision alternatively provides that if no such addresses exist, the executive director or executive director's designee will make reasonable efforts to notify the person who is alleged to have committed the violation.

TAWC recommended proposed §22.246(f)(2) be revised to provide clarity on how water and sewer utilities, as well as other "person, can update their contact information to ensure the commission maintains their correct mailing or e-mail address. TAWC stated the proposed revision would help prevent notices of violation or continuing violation to be sent to an incorrect mailing address or e-mail.

Commission response

The commission declines to implement the recommended change because it is out of scope. Addressing how utilities or other regulated entities provide up-to-date contact information to the commission is better suited for the commission's substantive rules, not procedural rules. The commission's substantive rules contain entity-specific requirements to update registrations, certifications, and other information with the commission.

Proposed §22.246(k) - Distribution of Disgorged Excess Revenues

Proposed §22.246(k) establishes the requirement for the disgorgement and remittance of excess revenues to an independent organization established under PURA §39.151, and the distribution of such excess revenues by the independent organization. Specifically, the provision requires the independent organization to distribute the excess revenue to affected wholesale electric market participants in proportion to their load during the intervals when the violation occurred to be used to reduce costs or fees incurred by retail electric customers. The provision also establishes that the commission may require the independent organization to distribute the excess revenue to affected wholesale market participants using a different distribution method in the same proceeding or may direct commission staff to open a subsequent proceeding to address those issues if the commission determines other wholesale electric market participants are affected or a different distribution method is appropriate.

OPUC recommended that proposed §22.246(k) be revised to extend the penalty to disgorge excess revenues to non-ERCOT utilities. OPUC stated that the proposed language would deprive ratepayers outside of ERCOT access to this remedy since the rule does not explicitly apply it to non-ERCOT utilities.

Commission response

The commission declines to implement the recommended change because it is out of scope. OPUC's proposed language represents a significant and substantive change to current enforcement practice that would necessitate further review by the commission and comment by interested stakeholders, particularly the non-ERCOT utilities. Moreover, it is unclear whether a provision that was originally designed to address the ERCOT wholesale market would be appropriate to apply to vertically integrated utilities without further investigation.

Proposed §22.261 - Proposals for Decision

Proposed §22.261 establishes the form and content requirements for proposals for decision in contested cases.

Proposed §22.261(a) - Requirement and Content of Proposal for Decision

Proposed §22.261(a) requires that a proposal for decision be served on all parties before the issuance of a final order that is adverse to any party other than the commission if a majority of the commissioners have not heard the case or read the record. The provision also establishes that the proposal for decision will be prepared by the presiding officer that conducted the hearing or that has read the record. The provision further requires a proposal for decision to include a proposed final order, a statement of the reasons for the proposed decision, and proposed findings of fact and conclusions of law in support of the proposed final order. The provision also establishes requirements applicable to filing exceptions to the proposal for decision and the supplementation, amendment, or correction of a proposal for decision.

Oncor recommended proposed §22.261(a) or other rule be revised to expressly authorize the commissioners to delegate authority to a subset of commissioners to hold and preside over a hearing. Oncor further recommended that the rule language should require the presiding commissioner to prepare a proposal for decision which must be then served on all parties and considered by all commissioners that were not recused from the case. Oncor commented that the addition would provide clarity on this practice and acknowledge that it is statutorily authorized under PURA §14.053(a). Moreover, Oncor indicated that adding such language would help provide guidance to stakeholders where some--but not all--commissioners may preside over an evidentiary hearing, but all commissioners will ultimately consider the proposal for decision and make a final determination in the case.

Commission response

The commission declines to implement the recommended change because it is out of scope. Oncor's proposed language represents a significant and substantive change to current commission open meeting practice that would necessitate further review by the commission and comment by interested stakeholders.

OPUC recommended proposed §22.261(a) be revised to require proposals for decision for expedited proceedings be issued within 30 days from the close of the record. OPUC defined "expedited proceedings" as commission proceedings where statute or rule requires the issuance of a commission decision either within 100 days from the date of filing or 100 days from the date an application is deemed administratively complete. OPUC stated that SOAH has imposed a 60-day deadline from the close of the evidentiary record to submit a proposal for decision for all commission proceedings. OPUC indicated that this 60-day timeline only provides parties and intervenors 40 days to litigate a case, which is generally inadequate in complex and detailed proceedings such as rate proceedings. OPUC commented that this is 60-day timeline imposed by SOAH is neither supported nor authorized by statute. OPUC cross-referenced its proposed revisions to §22.207 on this same issue and provided draft language consistent with its recommendation. OPUC also recommended the provision specify that "[a]ny party may file exceptions or replies to the proposed decision…" for completeness.

Commission response

The commission declines to implement the recommended change because it is out of scope. Further review is needed to evaluate OPUC's proposal with the requirements of the APA. It is unclear whether and to what extent the commission can require SOAH to meet commission-prescribed deadlines when statutory deadlines are also implicated.

Proposed §22.262 - Commission Action After a Proposal for Decision

Proposed §22.262 establishes the general authority and procedures associated with commission action after a proposal for decision has been issued.

Proposed §22.262(d) and §22.262(d)(3) - Oral Argument Before the Commission

Proposed §22.262(d) prescribes the requirements for oral argument before the commission. Proposed §22.262(d)(3) requires a request for oral argument to be filed as a separate written pleading no later than 5:00 p.m. seven days before the open meeting at which the commission is scheduled to consider the case.

Oncor and ETI opposed revising the filing deadline for oral argument from 3:00 p.m. to 5:00 p.m. seven days prior to the Open Meeting where the case will be considered under proposed §22.262(d)(3). Oncor and ETI expressed concern that this change conflicts with the current standard filing deadline used by the commission for pleadings and other filings, including the deadline for serving RFIs that are deemed to have been received on the same day. Therefore, the 3:00 p.m. deadline should be retained for consistency. ETI further stated the inconsistency may lead to confusion among pro se litigants.

Commission response

The commission declines to implement the recommended change because it is inconsistent with other revisions, such as those made in §22.71 in Project No. 52059 or §22.144 in Project No. 58401. Those amendments represent a policy choice by the commission to change deadlines for filing and discovery from 3:00 p.m. to 5:00 p.m. across the procedural rules. The commission also revises the provision to refer to "Central Prevailing Time" to be consistent with such other changes.

Proposed §22.264 - Rehearing

Proposed §22.264 establishes the requirements for motions for rehearing, replies to motion for rehearing, and commission action on motions for rehearing.

Proposed §22.264(f) - Procedure for extended commission time to act on a motion for rehearing.

Proposed §22.264(f) establishes that the Office of Policy and Docket Management must send separate ballots to each commissioner to determine whether they will consider the motion for rehearing at a subsequent open meeting if the commission extends time to act on a motion for rehearing. The provision also requires an affirmative vote by one commissioner to place the motion for rehearing on an open meeting agenda.

LCRA recommended proposed §22.264(f) be revised to specify that "the Office of Policy and Docket Management must send separate ballots" to be consistent with §22.264(e).

Commission response

The commission agrees with LCRA and implements the recommended change.

Proposed §22.281 - Initiation of Rulemaking

Proposed §22.281 establishes the requirements associated with the initiation of a rulemaking by the commission, including petitions for rulemaking.

Proposed §22.281(a) and §22.281(a)(1) - Petition for rulemaking and contents of petition for rulemaking.

Proposed §22.281(a) provides that any interested person, as defined by the APA, may petition the commission requesting the adoption of a new rule or the amendment of an existing rule. Proposed §22.281(a)(1) requires a rulemaking petition to be in writing and submitted to a project opened under §22.81(a)(2) for that purpose. The provision also establishes that a petition must include a brief explanation of the rule, each reason the new or amended rule should be adopted, the statutory authority for such a rule or amendment, and complete proposed text for the rule. The provision also established requirements for redline deletions and additions to commission rules included in the petition. The provision further provides that a suggested new rule or rule amendment that does not comply with each of the requirements of §22.281, including any rulemaking suggestion made in a contested case proceeding, will be construed as a policy recommendation and will not be processed as a formal rulemaking petition.

OPUC expressed support to the proposed changes to §22.281 only to the extent that such changes comply with the Texas APA and other statutes referenced by the APA concerning the rulemaking process. TAWC requested clarification on the usage of the term "rulemaking suggestion" under proposed §22.281(a)(1) in the context of a contested case proceeding. Specifically, TAWC inquired as to how that is distinct from a rulemaking petition. TAWC commented that it is unclear as to how a "rulemaking suggestion" may be made within a contested case hearing and also comply with the other specific requirements under §22.281. TAWC noted that conceivably "rulemaking suggestion" could be treated as a policy recommendation regardless of the requirements associated with a rulemaking petition, but if that is the intention then it should be clarified.

Commission response

The commission revises the provision for clarity as recommended by TAWC. Specifically, the commission revises §22.281(a)(1) to add the following sentence: "Any recommendation or request that the commission adopt a new rule or amend or repeal an existing rule that does not comply with the requirements of this section, including any recommendation or request made in a contested case proceeding (e.g., an argument by a party to a contested case that the commission should conduct a rulemaking before addressing a contested issue), will be construed as a policy recommendation and will not be processed as a petition for rulemaking under the APA and this section."

Existing §22.281(a)(2) - Publication of rulemaking petitions with the Texas Register

Existing §22.281(a)(2) concerned the filing of rulemaking notices with the Texas Register and the associated public comment period in response to petitions for rulemaking. Specifically, the provision required the commission to submit a notice for publication in the "In Addition" section of the Texas Register upon receipt of a petition for rulemaking. The provision required the notice to include a summary of the petition, the name of the person that submitted the petition, and notification that a copy of the petition will be available for review and copying in the commission's central records. The provision further established that comments on the petition are due 21 days from the date of publication of the notice and that failure to publish a notice of a petition for rulemaking in the Texas Register does not invalidate any commission action on the petition for rulemaking.

LCRA opposed the deletion of §22.281(a)(2) and recommended it be preserved to avoid conflict with statute. LCRA stated that the existing provision details the Texas Register notice requirements for rulemakings specified under the APA. Specifically, §2001.023 of the Texas Government Code which requires Texas state agencies to file notice of proposed rules with the Texas Secretary of State so that they may be published in the Texas Register. LCRA maintained that the commission must continue to comply with this requirement unless and until the APA is amended to state otherwise. LCRA provided draft language consistent with its recommendation.

Commission response

The commission disagrees with LCRA and declines to implement the recommended change. Section 2001.023 of the APA addresses when an agency must provide notice of a proposed rule, not a rulemaking petition. Section 2001.021 of the APA, which addresses rulemaking petitions, authorizes an interested person to request the adoption of a rule. Under Section 2001.021, a state agency must establish the form for a petition for rulemaking and the procedure for its submission. The section also establishes a 60 day deadline for the agency to act on the petition. The commission declines to retain Texas Register notice for rulemaking petitions because it is administratively burdensome to align open meeting schedules and Texas Register publication within the narrow statutory timeframe that the commission has to decide on rulemaking petitions. Instead, §22.281(a)(1) provides for public filing and comment of rulemaking petitions, which is not required by the APA, and consolidates all rulemaking petitions to a single project, which should facilitate more efficient and convenient review of such petitions.

Proposed §22.282 - Notice and Public Participation in Rulemaking Procedures

Proposed §22.282 establishes the requirements for notice and public participation in commission rulemakings, including initial comments, public hearings, staff recommendations, and final adoption.

Proposed §22.282(a) - Initial Comments

Proposed §22.282(a) governs the procedures for the solicitation of comments by the commission or commission staff prior to the publication of a proposed rule or amendment to an existing rule. The provision also establishes a general 30-day comment deadline unless otherwise stated by commission staff and authorizes the commission or commission staff to hold workshops or public hearings on the rulemaking.

TAWC recommended that the deleted language in proposed §22.282(a) concerning the publication of rulemaking notices in the Texas Register should be maintained. OPUC similarly recommended that language be retained with the qualifier "to the extent required by the APA." TAWC stated that the proposed revision requiring comment and feedback requests through the commission's filing system may result in some stakeholders not receiving notice of the request for comments. Therefore, the deleted language should be retained. OPUC emphasized that consumers are generally unaware of the commission's filing system, therefore the requirement to publish notice with the Texas Register should be retained. OPUC further commented that the term "commission filing system" be replaced with the phrase "with the commission's central records and on the commission's Interchange" for clarity. OPUC also recommended the reference to comments be revised to refer to "initial comments."

Commission response

The commission disagrees with OPUC and declines to implement the recommended change. Section §22.282(a) applies to informal comments prior to the issuance of a published rule. As such, there are no APA requirements on how the commission publicizes informal discussion drafts or strawman documents. Moreover, the APA generally authorizes Texas state agencies to use informal conferences and advisory committees under §2001.031 of the APA. The commission declines to limit commission staff's flexibility in designing its public engagement strategies during the informal stages of the rulemaking process. However, the commission revises the header and first sentence in §22.282(a) for clarity: "Informal comments. Prior to the publication of a proposed rule or an amendment to an existing rule in the Texas Register, the commission or commission staff may solicit comments on the necessity for, scope, or contents of a contemplated rulemaking project."

Proposed §22.282(e) - Staff Recommendation

Proposed §22.282(e) provides that staff's final recommendation will, if practicable, be filed in the rulemaking proceeding at least seven days prior to the date on which the commission is scheduled to consider the matter, unless another date is specified by the commission. The provision further states that the commission may still consider the recommendation or take action in the rulemaking project, even if commission staff does not file its final recommendation at least seven days prior to the date on which the commission is scheduled to consider the matter.

TAWC and ETI opposed the revision to §22.282(e) which would eliminate the mandatory seven-day deadline for commission staff to file its final rulemaking recommendation prior to an open meeting. TAWC and ETI recommended that proposed §22.282(e) be revised to state that commission staff's rulemaking proposals must be filed at least seven days prior to a commission open meeting. TAWC and ETI stated that filing rulemaking proposals earlier would provide affected persons and stakeholders additional time to comment at the open meeting where the proposal will be considered. TAWC and ETI maintained that less than seven days is insufficient time to review commission staff's recommendations and, if necessary, prepare comments.

Commission response

The commission disagrees with TAWC and ETI and declines to implement the recommended change. The seven-day deadline in the existing rule is not required by the APA and the revised provision provides transparency regarding current commission practice. As a practical matter, rulemaking documents are sometimes required to be presented at a commission open meeting regardless of whether commission staff's final recommendation is filed. Like all items scheduled for a duly posted open meeting, a rulemaking adoption order will be posted in full compliance with the Open Meetings Act, so interested persons will know in advance of when a rulemaking is scheduled to be filed. Commission staff will endeavor to meet the seven-day deadline for preview drafts whenever practicable.

Proposed §22.282(g) - Final adoption

Proposed §22.282(g) establishes that, following consideration of comments, the commission will issue an order adopting, adopting as amended, or withdrawing the rule within six months after the date of publication of the proposed rule or the rule is automatically withdrawn. The provision also authorizes commission staff to withdraw a rule on its own motion if necessary to facilitate the expeditious republication of proposed amendments to that rule.

Oncor opposed the inclusion of language in proposed §22.282(g) that would authorize commission staff to withdraw a rule on its own motion if necessary to facilitate the expeditious republication of proposed amendments to that rule and recommended it be deleted. Oncor maintained that the commission may decide to withdraw a proposed rule and replace it with a different proposal at an open meeting. Therefore, it is unnecessary to authorize commission staff to unilaterally withdraw a proposed rule at any time given the predictable cadence of open meetings. Oncor further remarked that there also may be instances where stakeholders are not in agreement with commission staff's position on whether a proposed rule should be withdrawn or substituted with another proposal.

Commission response

The commission omits the proposed language from §22.282(g) because it is unnecessary.

LCRA recommended that proposed §22.282(g) be revised to replace the term "rule" with the phrase "proposed rule." Oncor made the same recommendation as an alternative if the proposed revision is maintained. LCRA stated this revision is necessary to clarify that commission staff may not withdraw a rule formally adopted by the commission. LCRA commented that the proposed revision aligns with standard rulemaking procedures and helps avoid confusion regarding the status of rules already adopted by the commission. LCRA provided draft language consistent with its recommendation.

Commission response

The commission declines to implement the recommended change because it is moot. Specifically, the sentence concerning withdrawal of a rule from §22.282(g) is omitted from the adopted rule.

SUBCHAPTER K. HEARINGS

16 TAC §§22.201, 22.204, 22.205, 22.207

The amended rules are adopted under the following provisions of PURA and the Texas Water Code: PURA §14.001 and Texas Water Code §13.041(a), which provides the commission the general power to regulate and supervise the business of each public utility within its jurisdiction and to do anything specifically designated or implied by PURA that is necessary and convenient to the exercise of that power and jurisdiction; PURA §14.002 and Texas Water Code §13.041(b), which provides the commission with the authority to make adopt and enforce rules reasonably required in the exercise of its powers and jurisdiction; PURA §14.052 and Texas Water Code §13.041(b), which requires the commission to adopt and enforce rules governing practice and procedure before the commission and SOAH. The amended rules are also adopted under the following provisions of PURA: PURA §12.201 which requires the commission to prepare and publicize information of public interest describing the functions of the commission and the commission's procedures by which a complaint is filed with and resolved by the commission and requires the commission to, by rule, establish methods by which consumers and service recipients are notified of the name, mailing address, and telephone number of the commission for the purpose of directing complaints to the commission; PURA §15.023, which provides the commission with the authority to assess and impose an administrative penalty against a regulated person that violates PURA, or a rule or order adopted by the commission in accordance with PURA; PURA §15.051 which authorizes an affected person to complain to the regulatory in writing by a public utility in violation or claimed violation of a law that the regulatory authority has jurisdiction to administer or of an order, ordinance, or rule of the regulatory authority, and requires the commission to, for a reasonable period preserve information about each complaint filed with the commission that the commission has authority to resolve; PURA §17.157 which authorizes the commission to resolve disputes between a retail customer and a billing utility, service provider, telecommunications utility, retail electric provider, or electric utility, including the investigation of alleged violations; PURA Chapter 15, Subchapter B §§15.021-15.033 and Texas Water Code Chapter 13, Subchapter K §§13.411-13.419 which collectively establish the commission' s enforcement authority to enjoin, investigate, or require compliance from a person or entity in violation or alleged violation of statute or commission rules, including the commission's authority to impose and assess administrative penalties; and PURA Chapter 33, Subchapter C §§33.051-33.055 which governs the appeal of municipal ratemaking orders to the commission. The amended rules are also adopted under HB 1600 (83R), SB 567 (83R) and Texas Water Code Chapter 13 which transferred regulatory jurisdiction of the rates, operations, and services of retail public utilities from the Texas Commission on Environmental Quality to the commission and the following provisions of the Texas Government Code: Texas Government Code §§2001.004-007 and Subchapter B §§2001.021-2001.041 which establish general rulemaking requirements and procedures, including notice obligations, for agencies of the State of Texas; Texas Government Code Chapter 2001, Subchapter C §§2001.051-2001.062, which establish minimum standards of uniform practice and procedure for contested cases held at agencies of the State of Texas, including the requirements and procedures for a state agency to examine the record in a contested case and issue proposals for decision; Texas Government Code, Subchapter D § 2001.081-103, which govern the usage of and procedures for evidence, witnesses and discovery for contested cases held at agencies of the State of Texas; Texas Government Code Chapter 2001, Subchapter F §§2001.141-2001.147 which establish the requirements and procedures, including notice obligations, associated with the issuance of final decisions and orders by a state agency in a contested case, including the procedures for prerequisites to appeal and requirements for motions for rehearing.

Cross reference to statutes: Public Utility Regulatory Act §§14.001, 14.002, 14.052, and Texas Water Code §13.041(a) and (b); Public Utility Regulatory Act §§12.201, Chapter 15, Subchapter B 15.021-15.033, 15.051, 17.157; Chapter 33, Subchapter C 33.051-33.055; Texas Water Code Chapter 13, Subchapter K §§13.411-13.419; and HB 1600 (83R), SB 567 (83R) and Texas Water Code Chapter 13; Texas Government Code Chapter 2001, 2001.004-007 and Subchapter B 2001.021-2001.041; Subchapter C 2001.051-2001.062 and Subchapter D 2001.081-103; Subchapter F 2001.141-2001.147.

§22.201. Place and Nature of Hearings.

(a) Commission-held hearings. All commission-held hearings will be held in person and in Austin, Texas unless the commission determines that it is in the public interest to hold a hearing elsewhere or virtually. The presiding officer may, by written order, authorize a prehearing conference to be conducted virtually.

(b) Hearings held at SOAH. A pre-hearing conference or hearing held at SOAH, whether in-person or virtual, will be conducted in accordance with commission rules.

§22.205. Briefs.

(a) Briefs must conform, where practicable, to the requirements established for formatting pleadings in this chapter, including requirements for citations in §22.72 (relating to Form Requirements for Documents Filed with the Commission).

(1) Briefs in excess of ten pages must contain a table of contents with page numbers stated.

(2) The presiding officer may require parties to address certain issues or address issues in a specific order or format.

(b) If a legal authority cited in the briefs is not readily accessible, a copy of the legal authority must be provided upon request. Such legal authorities may include slip opinions, unpublished opinions, memorandum opinions, or documents from other jurisdictions that are not readily accessible to the commission.

§22.207. Referral to State Office of Administrative Hearings.

(a) The utility division of SOAH will conduct prehearing conferences and hearings related to contested cases before the commission, other than a prehearing conference conducted by a commission administrative law judge or a hearing conducted by one or more commissioners.

(1) At the time SOAH receives jurisdiction, or as soon as is reasonably practicable thereafter, the commission will provide to the SOAH administrative law judge a list of issues or areas that must be addressed.

(2) At any time, the commission may identify and provide to the SOAH administrative law judge additional issues or areas that must be addressed. The commission will send a request for setting or hearing, or request for assignment of a SOAH administrative law judge to SOAH in sufficient time to allow resolution of the proceeding prior to the expiration of any jurisdictional deadline.

(b) To give the commission sufficient time to consider a proposal for decision, the commission may specify the length of time prior to the expiration of a jurisdictional deadline by which the SOAH administrative law judge will issue a proposal for decision.

The agency certifies that legal counsel has reviewed the adoption and found it to be a valid exercise of the agency's legal authority.

Filed with the Office of the Secretary of State on March 13, 2026.

TRD-202601221

Katelyn Lewis

Rules Coordinator

Public Utility Commission of Texas

Effective date: April 2, 2026

Proposal publication date: October 3, 2025

For further information, please call: (512) 936-7044

SUBCHAPTER L. EVIDENCE AND EXHIBITS IN CONTESTED CASES

16 TAC §§22.221, 22.225, 22.228

§22.225. Written Testimony and Accompanying Exhibits.

(a) Prefiling of testimony, exhibits, and objections.

(1) Unless otherwise ordered by the presiding officer upon a showing of good cause, the written direct and rebuttal testimony and accompanying exhibits of each witness must be prefiled. Deposition testimony and responses to requests for information by an opposing party that a party plans to introduce as part of its direct case must be filed at the time the party files its written direct testimony.

(2) Deposition testimony and responses to requests for information that a party plans to introduce in support of its rebuttal case shall be filed at the time the party files its written rebuttal testimony.

(3) A party is not required to prefile documents it intends to use during cross-examination except that the presiding officer may require parties to identify documents that may be used during cross examination if it is necessary for the orderly conduct of the hearing.

(4) Objections to prefiled direct or rebuttal testimony and exhibits, including deposition testimony and responses to requests for information, must be filed on dates established by the presiding officer and will be ruled upon before or at the time the prefiled testimony and accompanying exhibits are offered.

(5) Nothing in this section precludes a party from using discovery responses in its direct or rebuttal case even if such responses were not received prior to the applicable deadline for prefiling written testimony and exhibits.

(6) The prefiled testimony schedule in a major rate proceeding must be established as set out in this subsection.

(A) Any utility filing an application to change its rates in a major rate proceeding must file the written testimony and exhibits supporting its direct case on the same date that such statement of intent to change its rates is filed with the commission. As set forth in §22.243(b) of this title (relating to Rate Change Proceedings), the prefiled written testimony and exhibits must be included in the rate filing package filed with the application.

(B) Other parties in the proceeding must prefile written testimony and exhibits according to the schedule set forth by the presiding officer. Except for good cause shown or upon agreement of the parties, commission staff representing the public interest may not be required to file earlier than seven days prior to hearing.

(7) A utility filing an application for a certificate of convenience and necessity (CCN), or an amendment to a CCN, for a new electric transmission facility must file written testimony and exhibits supporting its direct case on the same date that the application is filed with the commission.

(8) For any contested case that is not a major rate proceeding nor a CCN or CCN amendment proceeding for an electric transmission facility, the applicant is not required to prefile written testimony and exhibits at the time the filing is made unless otherwise required by statute or rule.

(9) The times for prefiling set out in this section may be modified by the presiding officer upon a showing of good cause.

(10) Late-filed testimony may be admitted into evidence if the testimony is necessary for a full disclosure of the facts and admission of the testimony into evidence would not be unduly prejudicial to the legal rights of any party. A party that intends to offer late-filed testimony into evidence must, at the earliest opportunity, inform the presiding officer, who will establish reasonable procedures and deadlines regarding such testimony.

(b) Admission of prefiled testimony. Unless otherwise ordered by the presiding officer, direct and rebuttal testimony must be received in written form. The written testimony of a witness on direct examination or rebuttal, either in narrative or question and answer form, may be received as an exhibit and incorporated into the record without the written testimony being read into the record. Unless otherwise ordered by the presiding officer, a witness who is offering written testimony must be sworn and must be asked whether the written testimony is a true and accurate representation of what the testimony would be if the testimony were to be given orally at the time the written testimony is offered into evidence. The witness must submit to cross-examination, clarifying questions, redirect examination, and recross-examination, unless the right to cross-examine the witness is waived by all parties and accepted by the presiding officer. The presiding officer may allow substitution of a witness or voir dire examination where appropriate. Written testimony is subject to the same evidentiary objections as oral testimony. Timely prefiling of written testimony and exhibits, if required under this section or by order of the presiding officer, is a prerequisite for admission into evidence.

(c) Supplementation of prefiled testimony and exhibits. Oral or written supplementation of prefiled testimony and exhibits may be allowed prior to or during the hearing provided that the witness is available for cross-examination. The presiding officer may exclude such testimony if there is a showing that the supplemental testimony raises new issues or unreasonably deprives opposing parties of the opportunity to respond to the supplemental testimony. The presiding officer may admit the supplemental testimony and grant the parties time to respond.

(d) Tender and service. On or before the date the prefiled written testimony and exhibits are due, parties must file such testimony and exhibits in accordance with the requirements of §22.71 of this title (relating to Commission Filing Requirements and Procedures, or other commission rule or order, of the testimony and exhibits with Central Records and must serve a copy upon each party.

(e) Withdrawal of evidence. Any exhibit offered and admitted in evidence may not be withdrawn except with the agreement of all parties and approval of the presiding officer.

The agency certifies that legal counsel has reviewed the adoption and found it to be a valid exercise of the agency's legal authority.

Filed with the Office of the Secretary of State on March 13, 2026.

TRD-202601222

Katelyn Lewis

Rules Coordinator

Public Utility Commission of Texas

Effective date: April 2, 2026

Proposal publication date: October 3, 2025

For further information, please call: (512) 936-7044

SUBCHAPTER M. PROCEDURES AND FILING REQUIREMENTS IN PARTICULAR COMMISSION PROCEEDINGS

16 TAC §§22.241, 22.244, 22.246

§22.241. Investigations.

(a) Commission investigations.

(1) The commission may at any time institute formal investigations on its own motion, or the motion of commission staff, into any matter within the commission's jurisdiction. Orders and pleadings initiating investigations will specify the matters to be investigated, and will be served upon the person being investigated.

(2) Notice of commission-instituted investigations of specific persons subject to commission regulation and investigative proceedings affecting such persons as a class will be served upon all affected persons under investigation. The commission will post notice with the Texas Register of prehearing conferences and hearings. The presiding officer may require additional notice.

(b) Show cause orders in complaint proceeding. The presiding officer, either upon his or her own motion or upon receipt of written complaint, may at any time after appropriate notice has been given, summon any person within the commission's jurisdiction to appear in a public hearing and show cause why such person should not be compelled to comply with any applicable statute, rule, regulation, or general order with which the person is allegedly not in compliance. All hearings in such show cause proceedings will be conducted in accordance with the provisions of this chapter.

(c) No limitations. Nothing in this section limits the commission's authority to investigate persons subject to the commission's jurisdiction.

§22.244. Review of Municipal Electric Rate Actions.

(a) Contents of petitions. In addition to any information required by statute, petitions for review of municipal rate actions filed under PURA §33.052 or §§33.101 - 33.104 must contain the original petition for review with the required signatures and following additional information.

(1) Each signature page of a petition must contain in legible form above the signatures the following:

(A) A statement that the petition is an appeal of a specific rate action of the municipality in question;

(B) The date of and a concise description of that rate action;

(C) A statement designating a specific individual, group of individuals, or organization as the signatories' authorized representative; and

(D) A statement that the designated representative is authorized to represent the signatories in all proceedings before the commission and appropriate courts of law and to do all things necessary to represent the signatories in those proceedings.

(2) The printed or typed name, telephone number, street or rural route address, and if available, the email address and facsimile transmission number of each signatory must be provided. Post office box numbers are not sufficient. In appeals relating to PURA §§33.101 - 33.104, the petition must list the address of the location where service is received if the address differs from the residential address of the signatory.

(b) Signatures. A signature must be counted only once, regardless of the number of bills the signatory receives. The signature must be of the person in whose name service is provided or such person's spouse. The signature must be accompanied by a statement indicating whether the signatory is appealing the municipal rate action as a qualified voter of that municipality under PURA §33.052, or as a customer of the municipality served outside the municipal limits under PURA §§33.101 - 33.104.

(c) Validity of petition and correction of deficiencies. The petition must include all of the information required by this section, legibly written, for each signature in order for the signature to be deemed valid. The presiding officer may allow the petitioner a reasonable time of up to 30 days from the date any deficiencies are identified to cure any defects in the petition.

(d) Verification of petition. Unless otherwise provided by order of the presiding officer, the following procedures must be followed to verify petitions appealing municipal rate actions filed under PURA §33.052 and §§33.101 - 33.104.

(1) Within 15 days of the filing of an appeal of a municipal rate action, the Office of Policy and Docket Management must send a copy of the petition to the respondent municipality with a directive that the municipality verify the signatures on the petition.

(2) Within 30 days after receipt of the petition from the Office of Policy and Docket Management, the municipality must file with the commission a statement of review, together with a supporting written affidavit sworn to by a municipal official.

(3) The period for the municipality's review of the signatures on the petition may be extended by the presiding officer for good cause.

(4) Failure of the municipality to timely submit the statement of review must result in all signatures being deemed valid, unless any signature is otherwise shown to be invalid or is invalid on its face.

(5) Objections by the municipality to the authenticity of signatures must be set out in its statement of review and will be resolved by the presiding officer.

(e) Disputes. Any dispute over the sufficiency or legibility of a petition will be resolved by the presiding officer by interim order.

§22.246. Administrative Penalties.

(a) Scope. This section addresses enforcement actions related to administrative penalties or disgorgement of excess revenues only and does not apply to any other enforcement actions that may be undertaken by the commission or commission staff.

(b) Definitions. The following words and terms, when used in this section, have the following meanings unless the context indicates otherwise:

(1) Affected wholesale electric market participant--An entity, including a retail electric provider (REP), municipally owned utility (MOU), or electric cooperative, that sells energy to retail customers and served load during the period of the violation.

(2) Excess revenue--As defined in §25.503 of this title (relating to Oversight of Wholesale Market Participants).

(3) Executive director--The executive director of the commission or the executive director's designee.

(4) Person--Includes a natural person, partnership of two or more persons having a joint or common interest, mutual or cooperative association, and corporation.

(5) Violation--Any activity or conduct prohibited by the Public Utility Regulatory Act (PURA), the Texas Water Code (TWC), commission rule, or commission order.

(6) Continuing violation--Except for a violation of PURA chapter 17, 55, or 64, and commission rules or commission orders adopted or issued under those chapters, any instance in which the person alleged to have committed a violation attests that a violation has been remedied and was accidental or inadvertent and subsequent investigation reveals that the violation has not been remedied or was not accidental or inadvertent.

(1) Each day a violation continues or occurs is a separate violation for which an administrative penalty can be levied, regardless of the status of any administrative procedures that are initiated under this subsection.

(2) The administrative penalty for each separate violation of PURA or of a rule or order adopted under PURA may not exceed the limits established by §25.8 of this title (relating to Classification System for Violations of Statutes, Rules, and Orders Applicable to Electric Service Providers).

(3) The amount of the administrative penalty must be based on:

(A) the seriousness of the violation, including the nature, circumstances, extent, and gravity of any prohibited acts, and the hazard or potential hazard created to the health, safety, or economic welfare of the public;

(B) the economic harm to property or the environment caused by the violation;

(D) the amount necessary to deter future violations;

(E) efforts to correct the violation;

(F) adherence to an applicable voluntary mitigation plan approved by the commission under §25.504 of this title (relating to Wholesale Market Power in the Electric Reliability Council of Texas Power Region); and

(G) any other matter that justice may require, including, but not limited to, the respondent's timely compliance with requests for information, completeness of responses, and the manner in which the respondent has cooperated with the commission during the investigation of the alleged violation.

(d) Amount of administrative penalty for violations of the TWC or a rule or order adopted under chapter 13 of the TWC.

(1) Each day a violation continues may be considered a separate violation for which an administrative penalty can be levied, regardless of the status of any administrative procedures that are initiated under this subsection.

(2) The administrative penalty for each separate violation may be in an amount not to exceed $5,000 per day.

(3) The amount of the penalty must be based on:

(A) the nature, circumstances, extent, duration, and gravity of the prohibited acts or omissions;

(B) the degree of culpability, including whether the violation was attributable to mechanical or electrical failures and whether the violation could have been reasonably anticipated and avoided;

(C) the demonstrated good faith, including actions taken by the person, affiliated interest, or entity to correct the cause of the violation;

(D) any economic benefit gained through the violations;

(E) the amount necessary to deter future violations; and

(F) any other matters that justice requires.

(e) Initiation of investigation. Upon receiving an allegation of a violation or of a continuing violation, the executive director will determine whether an investigation should be initiated.

(f) Report of violation or continuing violation. If, based on the investigation undertaken in accordance with subsection (e) of this section, the executive director determines that a violation or a continuing violation has occurred, the executive director may issue a report to the commission.

(1) Contents of the report. The report must state the facts on which the determination is based and a recommendation on the imposition of an administrative penalty, including a recommendation on the amount of the administrative penalty and, if applicable under §25.503 of this title, a recommendation that excess revenue be disgorged.

(2) Notice of report.

(A) Within 14 days after the report is issued, the executive director will give written notice of the report to the person who is alleged to have committed the violation or continuing violation which is the subject of the report. The notice must be given by regular mail, certified mail, or email to the mailing address or email address maintained in the commission's records. If no such addresses exist, the executive director or executive director's designee will make reasonable efforts to notify the person who is alleged to have committed the violation.

(B) For violations of the TWC or a rule or order adopted under chapter 13 of the TWC, within ten days after the report is issued, the executive director will, by certified mail, return receipt requested, give written notice of the report to the person who is alleged to have committed the violation or continuing violation which is the subject of the report.

(i) a brief summary of the alleged violation or continuing violation;

(ii) a statement of the amount of the recommended administrative penalty;

(iii) a statement recommending disgorgement of excess revenue, if applicable, under §25.503 of this title;

(iv) a statement that the person who is alleged to have committed the violation or continuing violation has a right to a hearing on the occurrence of the violation or continuing violation, the amount of the administrative penalty, or both the occurrence of the violation or continuing violation and the amount of the administrative penalty;

(v) a copy of the report issued to the commission under this subsection; and

(vi) a copy of this section, §22.246 of this title (relating to Administrative Penalties).

(D) If the commission sends written notice to a person by mail addressed to the person's mailing address as maintained in the commission's records, the person is deemed to have received notice:

(i) on the fifth day after the date that the commission sent the written notice, for notice sent by regular mail; or

(ii) on the date the written notice is received or delivery is refused, for notice sent by certified mail.

(g) Options for response to notice of violation or continuing violation.

(1) Opportunity to remedy.

(A) This paragraph does not apply to a violation of PURA chapters 17, 55, or 64; PURA §35.0021 or §38.075; or chapter 13 of the TWC; or of a commission rule or commission order adopted or issued under those chapters or sections.

(B) Within 40 days of the date of receipt of a notice of violation set out in subsection (f)(2) of this section, the person against whom the administrative penalty or disgorgement may be assessed may file with the commission proof that the alleged violation has been remedied and that the alleged violation was accidental or inadvertent. A person who claims to have remedied an alleged violation has the burden of proving to the commission both that an alleged violation was remedied before the 31st day after the date the person received the report of violation and that the alleged violation was accidental or inadvertent. Proof that an alleged violation has been remedied and that the alleged violation was accidental or inadvertent must be evidenced in writing, under oath, and supported by necessary documentation.

(C) If the executive director determines that the alleged violation has been remedied, was remedied within 30 days, and that the alleged violation was accidental or inadvertent, no administrative penalty will be assessed against the person who is alleged to have committed the violation.

(D) If the executive director determines that the alleged violation was not remedied or was not accidental or inadvertent, the executive director will make a determination as to what further proceedings are necessary.

(E) If the executive director determines that the alleged violation is a continuing violation, the executive director will institute further proceedings, including referral of the matter for hearing under subsection (i) of this section.

(2) Payment of administrative penalty, disgorged excess revenue, or both. Within 20 days after the date the person receives the notice set out in subsection (f)(2) of this section, the person may accept the determination and recommended administrative penalty and, if applicable, the recommended excess revenue to be disgorged through a written statement sent to the executive director. If this option is selected, the person must take all corrective action required by the commission. The commission by written order will approve the determination and impose the recommended administrative penalty and, if applicable, recommended disgorged excess revenue or order a hearing on the determination and the recommended penalty.

(3) Request for hearing. Not later than the 20th day after the date the person receives the notice set out in subsection (f)(2) of this section, the person may submit to the executive director a written request for a hearing on any or all of the following:

(A) the occurrence of the violation or continuing violation;

(B) the amount of the administrative penalty; and

(4) Failure to respond. If the person fails to timely respond to the notice set out in subsection (f)(2) of this section, the commission by order will approve the determination and impose the recommended penalty or order a hearing on the determination and the recommended penalty.

(5) Opportunity to remedy a weather preparedness violation.

(A) This paragraph applies to a violation of PURA §35.0021, §38.075, or a commission rule or order adopted or issued under those sections.

(B) PURA §15.024(c), as written, does not apply to a violation of PURA §35.0021, §38.075, or a commission rule or order adopted or issued under those sections. This paragraph implements PURA §15.024(c), as modified by PURA §15.023(a), §35.0021(g), and §38.075(d), for violations of PURA §35.0021, §38.075, or a commission rule or order adopted or issued under those sections.

(C) The commission may impose an administrative penalty against an entity regulated under PURA §35.0021 or §38.075 that violates those sections, or a commission rule or order adopted under those sections, except:

(i) the commission will assess a penalty for a violation of PURA §35.0021, §38.075, or a commission rule adopted under those sections if the entity against which the penalty may be assessed does not remedy the violation within a reasonable amount of time; and,

(ii) the commission will not assess a penalty for a violation of PURA §35.0021, §38.075, or a commission rule or order adopted or issued under those sections if the violation was accidental or inadvertent, and the entity against which the penalty may be assessed remedies the violation within a reasonable period of time.

(D) For purposes of this paragraph, the following provisions apply unless a provision conflicts with a commission rule or order adopted under PURA §35.0021 or §38.075, in which case, the commission rule or order applies.

(i) Not all violations to which this paragraph applies can be remedied. Subparagraph (C)(i) and (ii) of this paragraph do not apply to a violation that cannot be remedied.

(ii) For purposes of subparagraph (C)(i) and (ii) of this paragraph, an entity that claims to have remedied an alleged violation and, if applicable, that the alleged violation was accidental or inadvertent has the burden of proving its claim to the commission. Proof that an alleged violation has been remedied and, if applicable, that the alleged violation was accidental or inadvertent must be evidenced in writing, under oath, and supported by necessary documentation.

(iii) An entity that remedies a violation that is discovered during an inspection by the independent organization certified under PURA §39.151 for the ERCOT power region prior to the deadline provided to that entity by the independent organization in accordance with PURA §35.0021 or §38.075 is deemed to have remedied that violation in a reasonable period of time.

(iv) If the independent organization certified under PURA §39.151 has not provided an entity with a deadline, the executive director will determine whether the deadline can be remedied and, if so, the deadline for remedying a violation within a reasonable period of time. The executive director will provide the entity with written notice of the violation and the deadline for remedying the violation within a reasonable period of time. This notice does not constitute notice under subsection (f)(2) of this section unless it fulfills the other requirements of that subsection. However, the provisions of subsection (f)(2)(D) of this section apply to notice under this clause.

(v) The executive director will determine if and when a report should be issued to the commission under subsection (f) of this section and will make a determination as to what further proceedings are necessary.

(vi) If the executive director determines that the alleged violation was not remedied within a reasonable period of time or is a continuing violation, the executive director will issue a report to the commission under subsection (f) of this section and will institute further proceedings, including referral of the matter for hearing under subsection (i) of this section.

(vii) If the commission determines that the deadline for remedying a violation provided by the independent organization certified under PURA §39.151 or determined by the executive director is unreasonable, the commission will determine what the deadline should have been. The commission will use this updated deadline to determine the applicability of subparagraph (C)(i) and (ii) of this paragraph and, if appropriate, as a factor in determining the magnitude of administrative penalty to impose against the entity for the violation.

(h) Settlement conference. A settlement conference may be requested by any party to discuss the occurrence of the violation or continuing violation, the amount of the administrative penalty, disgorged excess revenue if applicable, and the possibility of reaching a settlement prior to hearing. A settlement conference is not subject to the Texas Rules of Evidence or the Texas Rules of Civil Procedure; however, the discussions are subject to Texas Rules of Civil Evidence 408, concerning compromise and offers to compromise.

(1) If a settlement is reached:

(A) the parties must file a report with the executive director setting forth the factual basis for the settlement;

(B) the executive director will issue the report of settlement to the commission; and

(2) If a settlement is reached after the matter has been referred to SOAH, the matter will be returned to the commission. If the settlement is approved, the commission will issue an order memorializing commission approval and setting forth commission orders associated with the settlement agreement.

(i) Hearing. If a person requests a hearing under subsection (g)(3) of this section, or the commission orders a hearing under subsection (g)(4) of this section, the commission will refer the case to SOAH under §22.207 of this title (relating to Referral to State Office of Administrative Hearings) and give notice of the referral to the person. For violations of the TWC or a rule or order adopted under chapter 13 of the TWC, if the person charged with the violation fails to timely respond to the notice, the commission by order will assess the recommended penalty or order a hearing to be held on the findings and recommendations in the report. If the commission orders a hearing, the case will then proceed as set forth in paragraphs (1) - (5) of this subsection.

(1) The commission will provide the SOAH administrative law judge a list of issues or areas that must be addressed.

(2) The hearing must be conducted in accordance with the provisions of this chapter and notice of the hearing must be provided in accordance with the Administrative Procedure Act.

(3) The SOAH administrative law judge will promptly issue to the commission a proposal for decision, including findings of fact and conclusions of law, about:

(A) the occurrence of the alleged violation or continuing violation;

(B) whether the alleged violation was cured and was accidental or inadvertent for a violation of any chapter other than PURA chapters 17, 55, or 64; of a commission rule or commission order adopted or issued under those chapters; or of chapter 13 of the TWC; and

(4) Based on the SOAH administrative law judge's proposal for decision, the commission may:

(A) determine that a violation or continuing violation has occurred and impose an administrative penalty and, if applicable, disgorged excess revenue;

(B) if applicable, determine that a violation occurred but that, as permitted by subsection (g)(1) of this section, the person remedied the violation within 30 days and proved that the violation was accidental or inadvertent, and that no administrative penalty will be imposed; or

(5) Notice of the commission's order issued under paragraph (4) of this subsection must be provided under the Government Code, chapter 2001 and §22.263 of this title (relating to Final Orders) and must include a statement that the person has a right to judicial review of the order.

(j) Parties to a proceeding. The parties to a proceeding under chapter 15 of PURA relating to administrative penalties or disgorgement of excess revenue will be limited to the person who is alleged to have committed the violation or continuing violation and the commission, including the independent market monitor. This does not apply to a subsequent proceeding under subsection (k) of this section.

(k) Distribution of Disgorged Excess Revenues. Disgorged excess revenues must be remitted to an independent organization, as defined in PURA §39.151. The independent organization must distribute the excess revenue to affected wholesale electric market participants in proportion to their load during the intervals when the violation occurred to be used to reduce costs or fees incurred by retail electric customers. However, if the commission determines other wholesale electric market participants are affected or a different distribution method is appropriate, the commission may direct the independent organization to distribute the excess revenue to affected wholesale market participants using a different distribution method in the same or a subsequent proceeding.

(1) No later than 90 days after the disgorged excess revenues are remitted to the independent organization, the monies must be distributed to affected wholesale electric market participants active at the time of distribution, or the independent organization must, by that date, notify the commission of the date by which the funds will be distributed. The independent organization must include with the distributed monies a communication that explains the docket number in which the commission ordered the disgorged excess revenues, an instruction that the monies must be used to reduce costs or fees incurred by retail electric customers, and any other information the commission orders.

(2) The commission may require any affected wholesale electric market participants receiving disgorged funds to demonstrate how the funds were used to reduce the costs or fees incurred by retail electric customers.

(3) Any affected wholesale electric market participant receiving disgorged funds that is affiliated with the person from whom the excess revenue is disgorged must distribute all of the disgorged excess revenues directly to its retail customers and must provide certification under oath to the commission.

The agency certifies that legal counsel has reviewed the adoption and found it to be a valid exercise of the agency's legal authority.

Filed with the Office of the Secretary of State on March 13, 2026.

TRD-202601223

Katelyn Lewis

Rules Coordinator

Public Utility Commission of Texas

Effective date: April 2, 2026

Proposal publication date: October 3, 2025

For further information, please call: (512) 936-7044

16 TAC §22.248

The repeal is adopted under the following provisions of PURA and the Texas Water Code: PURA §14.001 and Texas Water Code §13.041(a), which provides the commission the general power to regulate and supervise the business of each public utility within its jurisdiction and to do anything specifically designated or implied by PURA that is necessary and convenient to the exercise of that power and jurisdiction; PURA §14.002 and Texas Water Code §13.041(b), which provides the commission with the authority to make adopt and enforce rules reasonably required in the exercise of its powers and jurisdiction; PURA §14.052 and Texas Water Code §13.041(b), which requires the commission to adopt and enforce rules governing practice and procedure before the commission and SOAH. The repeal is also adopted under the following provisions of PURA: PURA §12.201 which requires the commission to prepare and publicize information of public interest describing the functions of the commission and the commission's procedures by which a complaint is filed with and resolved by the commission and requires the commission to, by rule, establish methods by which consumers and service recipients are notified of the name, mailing address, and telephone number of the commission for the purpose of directing complaints to the commission; PURA §15.023, which provides the commission with the authority to assess and impose an administrative penalty against a regulated person that violates PURA, or a rule or order adopted by the commission in accordance with PURA; PURA §15.051 which authorizes an affected person to complain to the regulatory in writing by a public utility in violation or claimed violation of a law that the regulatory authority has jurisdiction to administer or of an order, ordinance, or rule of the regulatory authority, and requires the commission to, for a reasonable period preserve information about each complaint filed with the commission that the commission has authority to resolve; PURA §17.157 which authorizes the commission to resolve disputes between a retail customer and a billing utility, service provider, telecommunications utility, retail electric provider, or electric utility, including the investigation of alleged violations; PURA Chapter 15, Subchapter B §§15.021-15.033 and Texas Water Code Chapter 13, Subchapter K §§13.411-13.419 which collectively establish the commission' s enforcement authority to enjoin, investigate, or require compliance from a person or entity in violation or alleged violation of statute or commission rules, including the commission's authority to impose and assess administrative penalties; and PURA Chapter 33, Subchapter C §§33.051-33.055 which governs the appeal of municipal ratemaking orders to the commission. The amended rules are also adopted under HB 1600 (83R), SB 567 (83R) and Texas Water Code Chapter 13 which transferred regulatory jurisdiction of the rates, operations, and services of retail public utilities from the Texas Commission on Environmental Quality to the commission and the following provisions of the Texas Government Code: Texas Government Code §§2001.004-007 and Subchapter B §§2001.021-2001.041 which establish general rulemaking requirements and procedures, including notice obligations, for agencies of the State of Texas; Texas Government Code Chapter 2001, Subchapter C §§2001.051-2001.062, which establish minimum standards of uniform practice and procedure for contested cases held at agencies of the State of Texas, including the requirements and procedures for a state agency to examine the record in a contested case and issue proposals for decision; Texas Government Code, Subchapter D § 2001.081-103, which govern the usage of and procedures for evidence, witnesses and discovery for contested cases held at agencies of the State of Texas; Texas Government Code Chapter 2001, Subchapter F §§2001.141-2001.147 which establish the requirements and procedures, including notice obligations, associated with the issuance of final decisions and orders by a state agency in a contested case, including the procedures for prerequisites to appeal and requirements for motions for rehearing.

The agency certifies that legal counsel has reviewed the adoption and found it to be a valid exercise of the agency's legal authority.

Filed with the Office of the Secretary of State on March 13, 2026.

TRD-202601226

Katelyn Lewis

Rules Coordinator

Public Utility Commission of Texas

Effective date: April 2, 2026

Proposal publication date: October 3, 2025

For further information, please call: (512) 936-7044

SUBCHAPTER N. DECISION AND ORDERS

16 TAC §§22.261 - 22.264

§22.261. Proposals for Decision.

(a) Requirement and Contents of Proposal for Decision. In a contested case, if a majority of the commissioners has not heard the case or read the record, the commission may not issue a final order, if adverse to a party other than the Commission, until a proposal for decision is served on all parties. The proposal for decision will be prepared by the presiding officer who conducted the hearing or who have read the record. The proposal for decision will include a proposed final order, a statement of the reasons for the proposed decision, and proposed findings of fact and conclusions of law in support of the proposed final order. Any party may file exceptions to the proposed decision in accordance with subsection (d) of this section. The presiding officer may supplement or amend a proposal for decision in response to the exceptions or replies submitted by the parties or upon the presiding officer's own motion. Making corrections or minor revisions of a proposal for decision is not considered issuance of an amended or supplemental proposal for decision.

(b) Procedures Regarding Proposed Orders. If the presiding officer's recommendation is not adverse to any party, the recommendation may be made through a proposed order containing findings of fact and conclusions of law. The proposed order must be served on all parties, and the commission counsel or presiding officer will establish a deadline for submitting proposed corrections or clarifications.

(c) Findings and Conclusions. The commission counsel or presiding officer may direct or authorize the parties to draft and submit proposed findings of fact and conclusions of law. The commission is not required to rule on findings of fact and conclusions of law that are not required or authorized.

(d) Exceptions and Replies.

(1) Who may file. Any party may file exceptions to the proposal for decision within the time period specified by commission counsel or the presiding officer. If any party files exceptions, the opportunity will be afforded to all parties to respond within a time period set by the commission counsel or presiding officer. Replies may only be filed in response to filed exceptions.

(2) Presentation. The presiding officer or commission counsel may require that issues be addressed in a specified order or according to a specified format. Proposed findings and conclusions may be submitted in conjunction with exceptions and replies. The evidence and law relied upon will be stated with particularity, and any evidence or arguments relied upon will be grouped under the exceptions or replies to which they relate.

(3) Request for Extension. A request for extension of time within which to file exceptions or replies must be filed with Central Records and served on all parties. The presiding officer or commission counsel may allow additional time for good cause shown. If additional time is allowed for exceptions, reasonable additional time will be allowed for replies.

§22.262. Commission Action After a Proposal for Decision.

(a) Commission Action. The commission may change a finding of fact or conclusion of law made by the administrative law judge or vacate or modify an order issued by the administrative law judge only if the commission:

(1) determines that the administrative law judge:

(A) did not properly apply or interpret applicable law, commission rules or policies, or prior administrative decisions; or

(B) issued a finding of fact that is not supported by a preponderance of the evidence; or

(2) determines that a commission policy or a prior administrative decision on which the administrative law judge relied is incorrect or should be changed.

(b) Reasons to Be in Writing. The commission will state in writing the specific reason and legal basis for its determination under subsection (a) of this section.

(1) The commission may direct that further consideration by an administrative law judge be accomplished with or without reopening the hearing and may limit the issues to be considered.

(2) If additional evidence is admitted on remand that results in a substantial revision of the proposed decision or the underlying facts, an amended or supplemental proposal for decision or proposed order must be filed. If an amended or supplemental proposal for decision is filed, the provisions of §22.261(d) of this title (relating to proposal for decision) apply. Exceptions and replies must be limited to discussions, proposals, and recommendations in the supplemental proposal for decision.

(d) Oral Argument Before the Commission.

(1) Any party may request oral argument before the commission before the final disposition of any proceeding.

(2) Oral argument may be allowed at the commission's discretion. The commission may limit the scope and duration of oral argument. The party bearing the burden of proof has the right to open and close oral argument.

(3) A request for oral argument must be filed as a separate written pleading. The request must be filed no later than 5:00 p.m. Central Prevailing Time seven days before the open meeting at which the commission is scheduled to consider the case.

(4) Upon the filing of a motion for oral argument, the Office of Policy and Docket Management must send a separate ballot to each commissioner to determine whether the commission will hear oral argument at an open meeting. An affirmative vote by one commissioner is required to grant oral argument. Two days before the commission is scheduled to consider the case, the Office of Policy and Docket Management will file a notice to the parties regarding whether a request for oral argument has been granted.

(5) The absence or denial of a request for oral argument does not preclude the commissioners from asking questions of any party present at the open meeting.

(e) Commission Not Limited. This section does not limit the commission in the conduct of its meetings to the specific types of action outlined in this section.

§22.264. Rehearing.

(a) Motions for rehearing, replies thereto, and commission action on motions for rehearing are governed by the APA. Only a party to a proceeding before the commission may file a motion for rehearing.

(b) All motions for rehearing must state the claimed error with specificity. If an ultimate finding of fact stated in statutory language is claimed to be in error, the motion for rehearing must state all underlying or basic findings of fact claimed to be in error and must cite specific evidence which is relied upon as support for the claim of error.

(c) A motion for rehearing or a reply to a motion for rehearing is untimely if it is not filed by the deadlines specified in APA §2001.146 or, if the commission extends the time to file such motion or reply or approves a time agreed to by the parties, the date specified in the order of the commission extending time or approving the time.

(d) A motion by a party to extend time related to a motion for rehearing must be filed no less than ten days before the end of the time period that the party seeks to extend or it is untimely. Such motion must state with specificity the reasons the extension is justified.

(e) Upon the filing of a timely motion for rehearing or a timely motion to extend time, the Office of Policy and Docket Management must send separate ballots to each commissioner to determine whether they will consider the motion at an open meeting. Untimely motions will not be balloted. An affirmative vote by one commissioner is required for consideration of a motion for rehearing or a motion to extend time at an open meeting. If no commissioner votes to add a timely motion to extend time to an open meeting for consideration, the motion is overruled ten days after the motion is filed.

(f) If the commission extends time to act on a motion for rehearing, the Office of Policy and Docket Management must send separate ballots to each commissioner to determine whether they will consider the motion for rehearing at a subsequent open meeting. An affirmative vote by one commissioner is required to place the motion for rehearing on an open meeting agenda.

(g) A party that files a motion for rehearing or a reply to a motion for rehearing must deliver a copy of the motion or reply to every other party in the case.

The agency certifies that legal counsel has reviewed the adoption and found it to be a valid exercise of the agency's legal authority.

Filed with the Office of the Secretary of State on March 13, 2026.

TRD-202601224

Katelyn Lewis

Rules Coordinator

Public Utility Commission of Texas

Effective date: April 2, 2026

Proposal publication date: October 3, 2025

For further information, please call: (512) 936-7044

SUBCHAPTER O. RULEMAKING

16 TAC §22.281, §22.282

§22.281. Initiation of Rulemaking.

(a) Petition for Rulemaking. Any interested person, as defined by the APA, may petition the commission requesting the adoption of a new rule or the amendment of an existing rule.

(1) The petition must be in writing and must be submitted to the project opened under paragraph (2) of this subsection. The petition must include a brief explanation of the rule, each reason the new or amended rule should be adopted, the statutory authority for such a rule or amendment, and complete proposed text for the rule. The proposed text for the rule must indicate by striking through the words, if any, to be deleted from the current rule and by underlining the words, if any, to be added to the current rule. Any recommendation or request that the commission adopt a new rule or amend or repeal an existing rule that does not comply with the requirements of this section, including any recommendation or request made in a contested case proceeding (e.g., an argument by a party to a contested case that the commission should conduct a rulemaking related to a contested issue), will be construed as a policy recommendation and will not be processed as a petition for rulemaking under the APA and this section.

(2) Each calendar year, commission staff will open a general project for petitions for rulemaking and post the control number on the commission's website.

(3) Commission staff may file a memo in the general project opened under paragraph (2) of this subsection establishing a deadline for interested persons to file comments in response to the petition for rulemaking or designating a new control number for the submission of comments. Commission staff may relocate any relevant filings from the general control number to the new project. If commission staff does not file a memo under this paragraph, comments on a petition for rulemaking may be filed in the general project and the deadline for submitting comments on the petition is 21 days after the date the petition is filed.

(4) Within 60 days after submission of a petition that fully complies with the requirements of paragraph (1) of this subsection, the commission will either deny the petition in writing, stating its reasons for the denial, or initiate a rulemaking proceeding.

(b) Commission Initiated Rulemaking. The commission may initiate rulemaking proceedings on its own motion. Nothing in this section precludes commission staff from consideration or development of new rules or amendments to existing rules, including hosting workshops or publishing questions or draft rules language for comment, without express direction from the commission.

§22.282. Notice and Public Participation in Rulemaking Procedures.

(a) Informal Comments. Prior to the publication of a proposed rule or an amendment to an existing rule in the Texas Register, the commission or commission staff may solicit comments on the necessity for, scope, or contents of a contemplated rulemaking project by filing a request for comments on the Interchange. Unless otherwise prescribed by the commission or commission staff, any comments concerning the rulemaking project must be submitted within 30 days from the date the request for comments is filed. The commission or commission staff may hold workshops or public hearings on the rulemaking project.

(b) Notice. The commission may initiate a rulemaking project by publishing notice of the proposed rule in accordance with Tex. Gov't Code §§ 2001.021 - 2001.037.

(c) Public Comments. Prior to the adoption of any rule, the commission will afford all interested persons a reasonable opportunity to submit data, views, or arguments in writing. Written comments must be filed within 30 days of the date the proposed rule is published in the Texas Register unless the commission establishes a different date for submission of comments. The commission may also establish a schedule for reply comments if it determines that additional comments would be appropriate or helpful in reaching a decision on the proposed rule. Commission staff may provide an extension to the comment deadline, request reply comments, or provide additional comment filing instructions in a rulemaking project.

(d) Public Hearing. The commission or commission staff may schedule workshops or public hearings on the proposed rule. Commission staff will hold a public hearing if requested by at least 25 persons, by a governmental subdivision or agency, or by an association having at least 25 members. The request for public hearing must be made no later than 30 days after the date the proposed rule is published in the Texas Register, unless the commission establishes a different date for requesting a public hearing. Commission staff may provide an extension to the public hearing request deadline.

(e) Staff Recommendation. Staff's final recommendation will, if practicable, be filed in the rulemaking proceeding at least seven days prior to the date on which the commission is scheduled to consider the matter, unless some other date is specified by the commission. If commission staff does not file its final recommendation at least seven days prior to the date on which the commission is scheduled to consider the matter, the commission may still consider the recommendation or take action in the rulemaking project.

(f) Final Adoption. Following consideration of comments, the commission will issue an order adopting, adopting as amended, or withdrawing the rule within six months after the date of publication of the proposed rule or the rule is automatically withdrawn.

The agency certifies that legal counsel has reviewed the adoption and found it to be a valid exercise of the agency's legal authority.

Filed with the Office of the Secretary of State on March 13, 2026.

TRD-202601225

Katelyn Lewis

Rules Coordinator

Public Utility Commission of Texas

Effective date: April 2, 2026

Proposal publication date: October 3, 2025

For further information, please call: (512) 936-7044

CHAPTER 25. SUBSTANTIVE RULES APPLICABLE TO ELECTRIC SERVICE PROVIDERS

SUBCHAPTER D. RECORDS, REPORTS, AND OTHER REQUIRED INFORMATION

16 TAC §25.88

The Public Utility Commission of Texas (commission) adopts one repeal in the Chapter 25 electric rules. The adopted repeal is in Subchapter D, §25.88, relating to Retail Market Performance Measure Reporting. The commission adopts the repeal without changes to the proposed text as published in the November 21, 2025 issue of the Texas Register (50 TexReg 7497). The repeal will not be republished.

The commission received comments about this project from AEP Texas Inc, Oncor Electric Delivery Company LLC, and Texas-New Mexico Power Company (filed jointly as Joint Commenters); CenterPoint Energy Houston Electric, LLC (CenterPoint); City of Houston (Houston); ERCOT; the Coalition of Competitive Retailers (Coalition); Texas Energy Association for Marketers (TEAM); and Vistra Corporate Service Company LLC (Vistra).

To assist the commission in its continued monitoring of the performance of the retail market, commission staff requested responses to the following two questions:

Question One

1. Are the Retail Market Performance Measures, and their associated schedule parts, provided by the commission in the filing package sufficient to monitor the competitive Texas retail electricity market? If not, what else should the commission consider in its Retail Performance Measures?

Houston commented that the measures proposed were not comprehensive enough to monitor the competitive Texas retail market specifically as it applies to customers within Houston city limits and provided several metrics to include.

Joint Commenters and CenterPoint stated that the proposed measures are sufficient to monitor the competitive Texas retail electricity market.

The Coalition responded by stating that the current Retail Market Performance Measures are more than sufficient to monitor the competitive retail market, and the proposed measures and new §25.88 will not meaningfully assist with market monitoring.

Vistra encouraged the Commission to avoid creating inefficiencies, redundancies, and unnecessary form/information gathering in this rulemaking.

TEAM requested that the reporting measures be taken on an annual basis.

Commission Response

The commission may consider Houston's recommended additions in future rulemakings as these recommendations are outside the scope of the current rulemaking project.

The commission disagrees with the Coalition that the proposed measures and new §25.88 will not meaningfully assist with evaluation of the performance of the retail electric market in Texas. However, in implementing commission priorities such as removing redundancies and improving reporting efficiency for commission staff and reporting entities, several data inputs have been removed from the filing package. Specific modifications to the filing package recommended by the Coalition are addressed in responses below.

The commission agrees with Vistra that regulatory efficiency is an integral part of this rulemaking. As such, the commission modifies the forms to reduce administrative burden by removing overlapping reporting requirements.

The commission disagrees with TEAM that these measures should be received annually. Receiving quarterly data on a yearly cadence has the potential to create inefficiencies for commission staff and impact their ability to review the data in a timely manner. To limit administrative impacts for both commission staff and reporting entities, all reporting entities will continue to submit the requirements on a quarterly cadence.

Question Two

2. What else should the commission consider in its implementation of PURA §39.168 and its amendment to §25.88?

City of Houston recommended the addition of several measures to Schedules A, B, and C.

Also, Houston recommended that a link to individual REP performance metrics under §25.88 be included with each competitive retail electric plan offered through the Power to Choose website.

Joint Commenters requested that the commission provide clarity regarding the requirements of §25.474(p)(3), relating to Selection of Retail Electric Provider, once §25.88 is adopted and on the intended interaction between the reports required under these two rules.

CenterPoint provided a redline of the proposed excel form in Schedule C, Part 1 and Schedule C, Part 2 tabs of the attached Quarterly Retail Performance Measures Form to clarify the transactions that should be included and excluded from the quarterly reports.

CenterPoint also stated that transmission distribution utilities currently provide separate filings for other measures, including Residential Summer Disconnect for Non-Pay, AMS Opt-Out, Deferred Payment Plan Switch Hold Report, and Distributed Generation Reporting. These reporting requirements, while historically valuable, may warrant reconsideration by the commission to ensure they still serve their purpose or if there are other efficiencies that could be achieved to support the ERCOT market.

Joint Commenters requested the rule take effect starting with the second quarterly report due in 2026 to allow sufficient time for personnel training on the new requirements and for updating internal technical processes. CenterPoint requested the rule begin the new Quarterly Retail Performance Measures Form reports starting with the first quarter that commences after the effective date of the new §25.88 rule.

Commission Response

The commission may consider Houston's recommended additions in future rulemakings as these recommendations are outside the scope of the current rulemaking project.

As the requirements of §25.474 are outside the scope of this rulemaking, the commission may consider the Joint Commenters' recommended changes to §25.474 in a future rulemaking.

The commission has reviewed the redlined excel document submitted by CenterPoint and agrees in part. While the commission believes that clarity is important, it declines to add CenterPoint's clarifying edits to Schedule C, Part 1 as they are unnecessary. However, the commission agrees in part with CenterPoint's proposed changes to Schedule C, Part 2, and has modified the schedule and its instructions to reference DUNS numbers.

Additionally, while CenterPoint's other recommendations are out of scope of the current project, the commission may take up these recommendations in future rulemakings.

The commission agrees with Joint Commenters and CenterPoint request to establish an effective date that allows sufficient time for entities to adapt to the adopted rule's requirements and adds language to the rule providing that the new reporting requirements start with the second quarter of 2026.

Proposed §25.88(b)(2) - Filing Deadline

Proposed §25.88(b)(2) requires the report to be filed no later than the 30th day following the end of the preceding quarterly reporting period.

TEAM suggested the rule deadline should remain unchanged, i.e., by no later than the 45th day after the end of quarter.

The Coalition expressed concern regarding the rule's deadline, specifically that thirty days is not sufficient and would only increase the opportunities for inaccurate data submission and will significantly increase costs for REPs.

Vistra recommended maintaining the existing 45-day deadline under existing 16 TAC §25.88(c)(2) and editing (b)(2) in the Proposal for Publication.

Commission Response

The commission agrees with TEAM, the Coalition, and Vistra that a 30-day deadline could create unnecessary regulatory burden. As such, the commission modifies proposed subsection (b)(2) to increase the reporting deadline to 45 days.

Proposed §25.88(b)(3) - Confidential Information

Proposed §25.88(b)(3) allows an entity to designate, as confidential, information within its report that it considers to be confidential.

TEAM recommended revising proposed 25.88(b)(3) to exempt REPs from making a redacted filing such that the public portion of the Report would include the confidential filing memorandum but not a redacted copy of the Report.

Commission Response

The commission declines to add TEAM's recommended changes to paragraph (b)(3) as 16 TAC Chapter 22, relating to Procedural Rules, dictates proper procedure for all filings. As such, the commission removes the paragraph because it is redundant.

Proposed §25.88(e)(3) - Additional Information to ERCOT

Proposed §25.88(e)(3) allows ERCOT to require entities to submit to ERCOT additional information that relates to market performance for specific analytical or diagnostic purposes.

TEAM and Vistra requested that proposed (e)(3) include a reasonableness requirement regarding the deadline by which additional information requested by ERCOT must be provided.

Commission Response

The commission disagrees with TEAM and Vistra and declines to add a reasonableness requirement to subsection (e)(3), as 16 TAC §22.5, relating to Suspension of Rules and Commission-Prescribed Forms, allows a market entity to which this rule applies to seek an exception to a reporting requirement under this rule if the entity can show good cause for the exception.

Repealed §25.88(e)(4) - Waiver

Repealed §25.88(e)(4) removed a provision that allowed the commission to waive reporting requirements if it determines that it is either impractical or unduly burdensome for the reporting entity to furnish the requested information.

The Coalition recommended that the adopted rule retain subsection (e)(4).

Commission Response

The commission disagrees with the Coalition as 16 TAC §22.5, relating to Suspension of Rules and Commission-Prescribed Forms, allows a market entity to which this rule applies to seek an exception to a reporting requirement under this rule if the entity can show good cause for the exception.

Proposed §25.88(f)(1) - Enforcement

Proposed §25.88(f)(1) states that the commission may impose all applicable administrative penalties under §22.246, relating to Administrative Penalties, of this title for failure of a reporting entity to timely file accurate performance measures report.

TEAM recommended amending the rule to require the consideration of factors like the existing rule, including compliance history and severity of the violation to assess a penalty. TEAM recommended substituting the word complete for the word accurate because whether a report is accurate is a more subjective determination.

Commission Response

The commission declines to list the factors the commission may consider in its investigation of an instance of non-compliance as these are provided in other rules, including, §22.246, §25.107, relating to Certification and Obligations of Retail Electric Providers (REPs), and §25.71 relating to General Procedures, Requirement and Penalties. In line with removing redundant references to applicable rules, the commission removes subsection (f)(1) from the adopted rule.

Instructions

The proposed instructions document specified that each entity must file its' report by the 30th day following the end of the preceding quarterly reporting period. The quarterly reporting periods begin on January 1, April 1, July 1, and October 1.

Monthly Data

The Coalition requested clarification on the method the required data is to be presented either for each month or consolidated for a calendar quarter. The Coalition argued that quarterly data would be of equal value and would be considerable cost savings for REPs.

Commission Response

The commission disagrees with the Coalition in part, because the additional granularity provided in the form and described in the form's instructions is necessary to evaluate specific performance measures. These include the measures related to retail sales, disconnection for non-payment, unauthorized change of REP, and field performance. However, the commission agrees it is not necessary to require every performance measure to be reported in monthly totals, and modifies the form and instructions document accordingly.

Proposed Schedule A Part 1 - Reporting Requirements for REPs Retail Sales

Proposed Schedule A Part 1 required each REP to file a facsimile of the information required by EIA Form 861M, for each month during the quarterly reporting period. Specifically, each REP must provide its revenue, megawatt hours sold, and number of customers by the customer types residential, commercial, and industrial, as defined by EIA Form 861M.

TEAM requested that any reporting requirements regarding the format for the submission of EIA data mirror current requirements.

Commission Response

The commission declines to allow a copy of the EIA Form 861M to suffice as proper filing under this rule. Portable Document Format (PDF) files are not a practical format for commission staff to conduct its necessary analyses. The commission requires the prescribed forms for consistency across reporting entities and to increase the efficiency of commission staff's review.

Proposed Schedule A Part 2 - Reporting Requirements for REPs Retail Sales by Premise Type

Proposed Schedule A, Part 2 required each REP to provide its retail sales for residential, small non-residential, medium non-residential, and large non-residential customers. Specifically, each REP must provide the corresponding customer counts, megawatt-hours sold, and revenues must be provided by premise type and TDU service territory for each month of the quarterly reporting period.

TEAM requested the removal of Schedule A, Part 2 to the Report as it would pose a regulatory burden. However, if the Commission approves Schedule A, Part 2 as proposed, TEAM recommended that this new requirement take effect no earlier than the Report for the first quarter of 2027. In addition TEAM provided that if the Commission adds the new reporting requirements embodied in Schedule A, Part 2, the proposed rule should be amended to require REPs to provide both this information and the EIA data required in Schedule A, Part 1 on an annual basis.

Vistra recommended deleting Schedule A, Part 2 entirely along with any associated reporting requirements outlined in the Commission' s form as duplicative.

Commission Response

The commission agrees with TEAM that providing consumer data under proposed Schedule A, Part 2 may present a regulatory burden for reporting entities. Additionally, the commission agrees with Vistra that proposed Schedule A, Part 2 includes overlapping reporting requirements for applicable entities. Therefore, the commission removes Schedule A, part 2 and amends Schedule B, Part 3 to require retail load information by transmission and distribution service provider.

Proposed Schedule A Part 3 - Reporting Requirements for REPs Retail Electric Provider Affiliations

Proposed Schedule A, Part 3 requires each REP to provide its affiliations by listing its subsidiaries and parent companies up to the ultimate corporate parent, and any sister companies that are registered or certified with the commission. Each company must be identified by name, relationship to the REP, and, if applicable, type of commission certification and corresponding certification number.

TEAM recommended limiting this schedule to a listing of all affiliates of a REP that also holds a REP certificate issued by the commission. TEAM further recommended that Schedule A, Part 3 should include a box a REP can check if the list of affiliates was the same for each month of the reporting period.

Commission Response

The commission disagrees with TEAM and declines to modify the instructions document and form to limit "affiliations" to only include other REPs registered with the commission. REPs provide the information one time under §25.107 for initial certification but do not consistently amend the information to reflect these changes. However, to minimize regulatory burdens, the commission modifies the form to require the reporting of affiliations once at the end of each quarter instead of each month of the quarter. The commission declines to add a check box to indicate that there have been no changes to the listed affiliations since the last required report; entities can simply submit the same list of its affiliates if there are no changes.

Proposed Schedule A Part 4 - Reporting Requirements for REPs Disconnection for Non-pay

Proposed Schedule A, Part 4 requires each REP to report the number of disconnect notices sent, disconnections requested, reconnections requested, and move-outs ordered after a Disconnection for Non-Pay (DNP) for residential customers, for critical care residential customers, chronic condition residential customers, and for prepaid service customers by TDU service territory for each month during the quarterly reporting period.

The Coalition recommended the commission eliminate from Schedule A, Part 4 the requirement to report the number of reconnections of a disconnected prepaid service customer completed within two hours. The Coalition stated that the proposed performance measurement conflicts with 16 TAC §25.498(j)(4), relating to Prepaid Service, because that rule requires a REP to submit a reconnection request no later than one hour after its customer has completed the reconnection requirements. Creating two separate reporting measurements, the Coalition posited, would create a discrepancy between the two rules and may impact the accuracy of what is reported. The Technical Performance Measures Report should not require any different period from that in §25.498(j)(4), relating to Prepaid Service.

The Coalition also recommended that the Commission either exempt customer accounts on prepaid plans from this requirement or develop a more practical reporting standard tailored to the unique nature of prepaid service.

In addition, the Coalition commented that the language in the proposed Instructions for Retail Performance Measures Report, Schedule A, Part 4 should not separate reporting concerning critical care residential customers and chronic condition residential customers.

Commission Response

The commission agrees with the Coalition that the data required under adopted §25.88 should be consistent with the requirements of §25.498 and modifies the form and the instructions document to remain consistent with §25.498(j)(4).

In order to address the unique nature of prepaid plans, the commission has modified proposed Schedule A, Part 4 to create a separate forms for prepaid customers in new Schedule A, Part 3.2, and to create a new form for post-pay customers, new Schedule A, Part 3.1.

Further, the commission agrees with the Coalition and clarifies that reporting under Schedule A, Part 3.1 for critical care residential customers and chronic condition residential customers is not to be reported as separate values. The commission modifies the instructions document to provide additional clarity.

Schedule B - Reporting Requirements for ERCOT

Proposed Schedule B dictates the retail performance measure reporting requirements for ERCOT.

ERCOT recommended updating Schedule B to remove the three references to TX Standard Electronic Transaction Change Control 814_07 as that transaction set was retired during a Texas SET upgrade and is no longer relevant.

Commission Response

The commission agrees with ERCOT and removes any reference to the 814_07 transaction set.

In adopting this section, the commission makes other minor modifications for the purpose of clarifying its intent.

This repeal is adopted under Public Utility Regulatory Act (PURA) §14.001, which grants the commission the general power to regulate and supervise the business of each public utility within its jurisdiction and to do anything specifically designated or implied by this title that is necessary and convenient to the exercise of that power and jurisdiction; §14.002, which authorizes the commission to adopt and enforce rules reasonably required in the exercise of its powers and jurisdiction; §14.003, which provides authority to require reports of a public utility; §15.023, which provides for commission imposition of an administrative penalty against a person regulated under PURA who violates PURA or a rule adopted under PURA; §39.001, which sets forth the legislative policy and purpose of PURA Chapter 39, Restructuring of Electric Utility Industry; §39.101, which sets forth customer safeguards; §39.151, which subjects to commission review procedures established by an independent operator relating to the reliability of the regional electrical network and accounting for the production and delivery of electricity among generators and all other market participants; §39.168, which requires REPs and its affiliates to annually report to the commission certain retail sales metrics; §39.352, which sets forth standards for certification of REPs; §39.356, which provides for suspension, revocation, or amendment of a REP's certificate; and §39.357, which provides for the imposition of administrative penalties on a REP for violations described by §39.356.

Cross Reference to Statute: Public Utility Regulatory Act §14.001, 14.002, 14.003, 15.023, 39.001, 39.101, 39.151, 39.168, 39.352, 39.356, and 39.357.

The agency certifies that legal counsel has reviewed the adoption and found it to be a valid exercise of the agency's legal authority.

Filed with the Office of the Secretary of State on March 13, 2026.

TRD-202601227

Katelyn Lewis

Rules Coordinator

Public Utility Commission of Texas

Effective date: April 2, 2026

Proposal publication date: November 21, 2025

For further information, please call: (512) 936-7433

16 TAC §25.88

The Public Utility Commission of Texas (commission) adopts new 16 TAC §25.88, relating to Retail Market Performance Measure Reporting. The adopted rule will implement Public Utility Regulatory Act (PURA) §39.168 as enacted by HB 1500 §24 during the Texas 88th Regular Legislative Session. Additionally, the adopted rule streamlines the reporting of competitive retail market data to the commission by Retail Electric Providers (REPs), Electric Reliability Council of Texas (ERCOT), and Transmission and Distribution Utilities (TDUs); thereby standardizing reporting practices across reporting entities. Further, the adopted rule reduces redundant data submission requirements for certain entities. The commission adopts this rule with changes to the proposed text as published in the November 21, 2025, issue of the Texas Register (50 TexReg 7497). This rule will be republished.

To assist the commission in its continued monitoring of the performance of the retail market, commission staff requested responses to the following two questions:

Question One

Joint Commenters and CenterPoint stated that the proposed measures are sufficient to monitor the competitive Texas retail electricity market.

Vistra encouraged the Commission to avoid creating inefficiencies, redundancies, and unnecessary form/information gathering in this rulemaking.

TEAM requested that the reporting measures be taken on an annual basis.

Commission Response

The commission may consider Houston's recommended additions in future rulemakings as these recommendations are outside the scope of the current rulemaking project.

Question Two

2. What else should the commission consider in its implementation of PURA §39.168 and its amendment to §25.88?

City of Houston recommended the addition of several measures to Schedules A, B, and C.

Also, Houston recommended that a link to individual REP performance metrics under §25.88 be included with each competitive retail electric plan offered through the Power to Choose website.

Commission Response

The commission may consider Houston's recommended additions in future rulemakings as these recommendations are outside the scope of the current rulemaking project.

As the requirements of §25.474 are outside the scope of this rulemaking, the commission may consider the Joint Commenters' recommended changes to §25.474 in a future rulemaking.

Additionally, while CenterPoint's other recommendations are out of scope of the current project, the commission may take up these recommendations in future rulemakings.

Proposed §25.88(b)(2) - Filing Deadline

Proposed §25.88(b)(2) requires the report to be filed no later than the 30th day following the end of the preceding quarterly reporting period.

TEAM suggested the rule deadline should remain unchanged, i.e., by no later than the 45th day after the end of quarter.

Vistra recommended maintaining the existing 45-day deadline under existing 16 TAC §25.88(c)(2) and editing (b)(2) in the Proposal for Publication.

Commission Response

Proposed §25.88(b)(3) - Confidential Information

Proposed §25.88(b)(3) allows an entity to designate, as confidential, information within its report that it considers to be confidential.

TEAM recommended revising proposed §25.88(b)(3) to exempt REPs from making a redacted filing such that the public portion of the Report would include the confidential filing memorandum but not a redacted copy of the Report.

Commission Response

The commission declines to add TEAM's recommended changes to subsection (b)(3) as 16 TAC Chapter 22, relating to Procedural Rules, dictates proper procedure for all filings. As such, the commission removes the paragraph because it is redundant.

Proposed §25.88(e)(3) - Additional Information to ERCOT

Proposed §25.88(e)(3) allows ERCOT to require entities to submit to ERCOT additional information that relates to market performance for specific analytical or diagnostic purposes.

TEAM and Vistra requested that proposed (e)(3) include a reasonableness requirement regarding the deadline by which additional information requested by ERCOT must be provided.

Commission Response

Repealed §25.88(e)(4) - Waiver

The Coalition recommended that the adopted rule retain subsection (e)(4).

Commission Response

Proposed §25.88(f)(1) - Enforcement

Commission Response

Instructions

Monthly Data

Commission Response

Proposed Schedule A Part 1 - Reporting Requirements for REPs Retail Sales

TEAM requested that any reporting requirements regarding the format for the submission of EIA data mirror current requirements.

Commission Response

Proposed Schedule A Part 2 - Reporting Requirements for REPs Retail Sales by Premise Type

Vistra recommended deleting Schedule A, Part 2 entirely along with any associated reporting requirements outlined in the Commission' s form as duplicative.

Commission Response

Proposed Schedule A Part 3 - Reporting Requirements for REPs Retail Electric Provider Affiliations

Commission Response

Proposed Schedule A Part 4 - Reporting Requirements for REPs Disconnection for Non-pay

Commission Response

Schedule B - Reporting Requirements for ERCOT

Proposed Schedule B dictates the retail performance measure reporting requirements for ERCOT.

Commission Response

The commission agrees with ERCOT and removes any reference to the 814_07 transaction set.

In adopting this section, the commission makes other minor modifications for the purpose of clarifying its intent.

This section is adopted under Public Utility Regulatory Act (PURA) §14.001, which grants the commission the general power to regulate and supervise the business of each public utility within its jurisdiction and to do anything specifically designated or implied by this title that is necessary and convenient to the exercise of that power and jurisdiction; §14.002, which authorizes the commission to adopt and enforce rules reasonably required in the exercise of its powers and jurisdiction; §14.003, which provides authority to require reports of a public utility; §15.023, which provides for commission imposition of an administrative penalty against a person regulated under PURA who violates PURA or a rule adopted under PURA; §39.001, which sets forth the legislative policy and purpose of PURA Chapter 39, Restructuring of Electric Utility Industry; §39.101, which sets forth customer safeguards; §39.151, which subjects to commission review procedures established by an independent operator relating to the reliability of the regional electrical network and accounting for the production and delivery of electricity among generators and all other market participants; §39.168, which requires REPs and its affiliates to annually report to the commission certain retail sales metrics; §39.352, which sets forth standards for certification of REPs; §39.356, which provides for suspension, revocation, or amendment of a REP's certificate; and §39.357, which provides for the imposition of administrative penalties on a REP for violations described by §39.356.

Cross Reference to Statute: Public Utility Regulatory Act §14.001, 14.002, 14.003, 15.023, 39.001, 39.101, 39.151, 39.168, 39.352, 39.356, and 39.357.

§25.88. Retail Market Performance Measure Reporting.

(a) Applicability. This section applies to the Electric Reliability Council of Texas (ERCOT), retail electric providers (REPs), and transmission and distribution utilities (TDUs) except TDUs that provide only wholesale transmission service.

(b) Filing requirements. Using forms prescribed by the commission, a reporting entity must report activities as required by this section.

(1) Each entity must provide an electronic version of its retail market performance measures report (report) in a manner prescribed by the commission and follow any reporting instructions provided by the commission. The report and any accompanying documentation must be filed in the native format of the file.

(2) Beginning with the second quarter of 2026. The report must be filed no later than the 45th day following the end of the preceding quarterly reporting period. Quarterly periods begin on January 1, April 1, July 1, and October 1.

(c) Retail Market Performance Measures. The report requires reporting entities to provide data and documentation regarding the following performance measures:

(1) Competitive market indicators;

(2) Technical market mechanics; and

(3) Field performance statistics.

(d) Supporting documentation. Each Report must include:

(1) Analysis. Each report must include an analysis or explanation of the reporting entity's data and performance for the quarterly reporting period for any retail market performance measure that does not meet the expected performance level. The explanation or analysis must include the change in performance over the past quarterly reporting period and an explanation of circumstances that may have affected the reporting entity's performance.

(2) Report attestation. Each report submitted to the commission must be accompanied by a signed, notarized affidavit by an executive officer as defined in §25.107. The affidavit must attest that all material provided in the report is true, correct, and complete.

(3) Supporting documents available for inspection. Each supporting document, including records, books, and memoranda must be made available for inspection by the commission or commission staff upon request. Supporting documents must be maintained for a period of 24 months after the report date.

(e) Other reports.

(1) Additional reports requested by staff. The commission or commission staff may require a reporting entity to submit additional reports to allow the commission to analyze the changing dynamics of the retail electric market or to obtain information on specific issues that may require additional diagnostic review.

(2) Supplemental information. Upon request by the commission or commission staff, a reporting entity must provide any additional information that relates to its report. Such requests will provide a reasonable deadline that takes into account the information requested.

(3) Additional reports requested by ERCOT. ERCOT may require reporting entities to provide to ERCOT additional information that relates to market performance for specific analytical or diagnostic purposes.

(f) Enforcement by the commission.

(1) Failure to timely file an accurate report. The commission may impose all applicable administrative penalties under §22.246 of this title for failure of a reporting entity to timely file an accurate performance measures report.

(2) Prohibited conduct. Each entity must complete within the parameters set forth in the ERCOT Protocols and/or the Standard Tariff for Retail Delivery Service under §25.214 of this title (relating to Terms and Conditions of Retail Delivery Service Provided by Investor Owned Transmission and Distribution Utilities), at least 98% of all its technical market transactions in each transaction category identified in the filing package.

(g) Public information. The commission may produce a summary report on the retail market performance measures using the information collected as a result of these reporting requirements. Any such report will only contain public information. The commission may post the report on the commissions website or provide the report to any interested entity.

The agency certifies that legal counsel has reviewed the adoption and found it to be a valid exercise of the agency's legal authority.

Filed with the Office of the Secretary of State on March 13, 2026.

TRD-202601228

Katelyn Lewis

Rules Coordinator

Public Utility Commission of Texas

Effective date: April 2, 2026

Proposal publication date: November 21, 2025

For further information, please call: (512) 936-7433