Texas SB1977 amends the Utilities Code and Water Code to restrict certain expenses from being included in ratemaking for electric and water utilities.

Texas SB1977 amends the Utilities Code to prohibit the recovery of legal expenses for electric utilities in rate proceedings if they exceed the greater of $50,000 or 50 percent of the total legal expenses incurred. It also prohibits the recovery of unreasonable, unnecessary, or non-public interest expenditures, including executive salaries, advertising expenses, and civil penalties. The Water Code is similarly amended to exclude legislative advocacy expenses and refund processing costs from ratemaking. These changes apply to rate proceedings beginning on or after September 1, 2025.

Texas SB1977 amends the Utilities Code and Water Code to restrict certain expenses from being included in ratemaking for electric and water utilities.

Texas SB1977 amends the Utilities Code to prohibit the recovery of legal expenses for electric utilities in rate proceedings if they exceed the greater of $50,000 or 50 percent of the total legal expenses incurred. It also prohibits the recovery of unreasonable, unnecessary, or non-public interest expenditures, including executive salaries, advertising expenses, and civil penalties. The Water Code is similarly amended to exclude legislative advocacy expenses and refund processing costs from ratemaking. These changes apply to rate proceedings beginning on or after September 1, 2025.