SB 6 – Relating to electricity planning and infrastructure costs for large loads.

This is a short Summary: Texas Large Load Electricity Planning Bill. Read the entire bill here

This bill has passed the Senate but still has to go through the House and the Governor.

This bill establishes new rules for large electricity customers (75+ megawatts, A large electricity customer in this bill refers to any industrial, commercial, or institutional facility that requires 75 megawatts (MW) or more of power at a single site.) in Texas to ensure grid reliability, fair cost-sharing, and transparency in infrastructure planning.

Key Provisions:
1. Cost Recovery for Utilities
– Large customers must help pay for grid interconnection costs.
– Municipal utilities and co-ops can pass these costs directly to large users.

2. New Standards for Large Loads
– Disclosure requirements: Customers must reveal if they’re seeking similar service elsewhere (to prevent wasted infrastructure).
– Backup power reporting: Large customers must disclose on-site backup generators, which ERCOT can call on during emergencies.
– Study fees: At least $100,000 for initial transmission studies (refundable if unused).
– Financial commitments: Customers must provide security (e.g., bonds, prepayments) before utilities build transmission lines.

3. Grid Reliability Measures
– ERCOT can require large customers to curtail usage or activate backup power during emergencies.
– New demand-response program for loads over 75 MW to help prevent blackouts.

4. Net Metering Rules
– Companies pairing large new loads with existing generation (e.g., industrial solar) must get regulatory approval to ensure grid stability.

5. Transmission Cost Review
– The PUC must study whether current wholesale transmission pricing fairly allocates costs.

Effective Date:
– Immediately if passed by a 2/3 majority, otherwise September 1, 2025.

Impact:
– Large businesses: Higher upfront costs but clearer rules for connecting to the grid.
– Utilities: More certainty in recovering infrastructure expenses.
– ERCOT: Better tools to manage demand during emergencies.

This bill aims to balance economic growth with grid reliability while ensuring large users pay their fair share.

Why is this important?

We have experienced black out because of our failing power grid system and any added strain can affect us further. There is a very large AI data center and Tesla’s new battery factory that will/are currently being built in Texas. These will have a major impact on Texas’ energy grid, but this new law is designed to manage that impact. Here’s how:

1. How These Facilities Strain the Grid
– AI Data Centers
– Extremely power-hungry, some AI facilities use 100+ MW (equivalent to ~20,000+ homes).
– 24/7 operation with no flexibility, unlike factories, they can’t easily power down during shortages.
– Tesla Battery Factories
– Gigafactories (like Tesla’s in Austin) can require 200+ MW at full production.
– High demand for lithium processing, which is energy-intensive.

Result: If multiple such projects connect to the grid without planning, they could overwhelm local transmission lines and increase blackout risks.