H.B. No. 3693

	AN ACT
	relating to energy demand, energy load, energy efficiency
	incentives, energy programs, and energy performance measures.
	BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
	SECTION 1.  Subchapter Z, Chapter 44, Education Code, is
	amended by adding Section 44.902 to read as follows:
	Sec. 44.902.  GOAL TO REDUCE CONSUMPTION OF ELECTRIC ENERGY.
	The board of trustees of a school district shall establish a goal to
	reduce the school district's annual electric consumption by five
	percent each state fiscal year for six years beginning September 1,
	2007.
	SECTION 2.  Subchapter Z, Chapter 44, Education Code, is
	amended by adding Section 44.903 to read as follows:
	Sec. 44.903.  ENERGY-EFFICIENT LIGHT BULBS IN INSTRUCTIONAL
	FACILITIES.  (a)  In this section, "instructional facility" has the
	meaning assigned by Section 46.001.
	(b)  A school district shall purchase for use in each type of
	light fixture in an instructional facility the commercially
	available model of light bulb that:
	(1)  uses the fewest watts for the necessary luminous
	flux or light output;
	(2)  is compatible with the light fixture; and
	(3)  is the most cost-effective, considering the
	factors described by Subdivisions (1) and (2).
	SECTION 3.  Subchapter Z, Chapter 51, Education Code, is
	amended by adding Section 51.9271 to read as follows:
	Sec. 51.9271.  ENERGY-EFFICIENT LIGHT BULBS IN EDUCATIONAL
	AND HOUSING FACILITIES.  (a)  In this section, "housing facility"
	has the meaning assigned by Section 53.02.
	(b)  An institution of higher education shall purchase for
	use in each type of light fixture in an educational or housing
	facility the commercially available model of light bulb that:
	(1)  is compatible with the light fixture;
	(2)  uses the fewest watts for the necessary luminous
	flux or light output; and
	(3)  is the most cost-effective, considering the
	factors described by Subdivisions (1) and (2).
	SECTION 4.  Section 2155.068(d), Government Code, is amended
	to read as follows:
	(d)  As part of the standards and specifications program, the
	commission shall:
	(1)  review contracts for opportunities to recycle
	waste produced at state buildings;
	(2)  develop and update a list of equipment and
	appliances that meet the energy efficiency standards provided by
	Section 2158.301; and
	(3)  assist state agencies in selecting products under
	Section 2158.301, as appropriate.
	SECTION 5.  Chapter 2158, Government Code, is amended by
	adding Subchapter F to read as follows:
	SUBCHAPTER F.  ENERGY AND EFFICIENCY STANDARDS FOR EQUIPMENT AND
	APPLIANCES
	Sec. 2158.301.  ENERGY CONSERVATION.  If available and
	cost-effective, a state agency shall purchase equipment and
	appliances for state use that meet or exceed:
	(1)  the federal energy conservation standards under
	Section 325, Energy Policy and Conservation Act (42 U.S.C. Section
	6295), or a federal regulation adopted under that Act; or
	(2)  the federal Energy Star standards designated by
	the United States Environmental Protection Agency and the United
	States Department of Energy.
	SECTION 6.  Subchapter A, Chapter 2165, Government Code, is
	amended by adding Section 2165.008 to read as follows:
	Sec. 2165.008.  ENERGY-EFFICIENT LIGHT BULBS IN STATE
	BUILDINGS.  A state agency or institution of higher education in
	charge and control of a state building shall purchase for use in
	each type of light fixture in the building the commercially
	available model of light bulb that:
	(1)  uses the fewest watts for the necessary luminous
	flux or light output; and
	(2)  is compatible with the light fixture.
	SECTION 7.  Subchapter B, Chapter 2165, Government Code, is
	amended by adding Section 2165.058 to read as follows:
	Sec. 2165.058.  VENDING MACHINES; ENERGY-SAVING DEVICE
	REQUIRED.  (a)  This section does not apply to a vending machine
	that contains a perishable food product, as defined by Section
	96.001, Civil Practice and Remedies Code.
	(b)  The commission shall require an entity that owns or
	operates a vending machine located in a building owned or leased by
	the state to activate and maintain any internal energy-saving or
	energy-management device or option that is already part of the
	machine or contained in the machine.
	(c)  The commission shall require the use of an external
	energy-saving or energy-management device for each vending machine
	that:
	(1)  is located in a building owned or leased by the
	state;
	(2)  operates with a compressor; and
	(3)  does not have an activated and operational
	internal energy-saving or energy-management device or option.
	(d)  An entity that owns or operates a vending machine
	subject to this section is responsible for any expenses associated
	with the acquisition, installation, or maintenance of an
	energy-saving device required by this section.
	(e)  The commission may impose an administrative fine on an
	entity that operates a vending machine subject to this section in an
	amount not to exceed $250 a year for each machine found to be in
	violation of this section or rules adopted by the commission under
	this section.
	(f)  The commission shall adopt rules relating to the
	specifications for and regulation of energy-saving devices
	required by this section.
	SECTION 8.  Subtitle F, Title 10, Government Code, is
	amended by adding Chapter 2264 to read as follows:
	CHAPTER 2264. REQUIRED PUBLICATION AND REPORTING BY GOVERNMENTAL
	ENTITIES
	Sec. 2264.001.  RECORDING AND REPORTING OF ELECTRICITY,
	WATER, AND NATURAL GAS CONSUMPTION.  (a)  In this section,
	"governmental entity" means:
	(1)  a board, commission, or department of the state or
	a political subdivision of the state, including a municipality, a
	county, or any kind of district; or
	(2)  an institution of higher education as defined by
	Section 61.003, Education Code.
	(b)  Notwithstanding any other law, a governmental entity
	responsible for payments for electric, water, or natural gas
	utility services shall record in an electronic repository the
	governmental entity's metered amount of electricity, water, or
	natural gas consumed for which it is responsible to pay and the
	aggregate costs for those utility services.  The governmental
	entity shall report the recorded information on a publicly
	accessible Internet website with an interface designed for ease of
	navigation if available, or at another publicly accessible
	location.
	SECTION 9.  Subchapter H, Chapter 2306, Government Code, is
	amended by adding Section 2306.187 to read as follows:
	Sec. 2306.187.  ENERGY EFFICIENCY STANDARDS FOR CERTAIN
	SINGLE AND MULTIFAMILY DWELLINGS.  (a)  A newly constructed single
	or multifamily dwelling that is constructed with assistance awarded
	by the department, including state or federal money, housing tax
	credits, or multifamily bond financing, must include energy
	conservation and efficiency measures specified by the department.
	The department by rule shall establish a minimum level of energy
	efficiency measures that must be included in a newly constructed
	single or multifamily dwelling as a condition of eligibility to
	receive assistance awarded by the department for housing
	construction.  The measures adopted by the department may include:
	(1)  the installation of Energy Star-labeled ceiling
	fans in living areas and bedrooms;
	(2)  the installation of Energy Star-labeled
	appliances;
	(3)  the installation of Energy Star-labeled lighting
	in all interior units;
	(4)  the installation of Energy Star-labeled
	ventilation equipment, including power-vented fans, range hoods,
	and bathroom fans;
	(5)  the use of energy efficient alternative
	construction material, including structural insulated panel
	construction;
	(6)  the installation of central air conditioning or
	heat pump equipment with a better Seasonal Energy Efficiency Rating
	(SEER) than that required by the energy code adopted under Section
	388.003, Health and Safety Code; and
	(7)  the installation of the air ducting system inside
	the conditioned space.
	(b)  A single or multifamily dwelling must include energy
	conservation and efficiency measures specified by the department
	if:
	(1)  the dwelling is rehabilitated with assistance
	awarded by the department, including state or federal money,
	housing tax credits, or multifamily bond financing; and
	(2)  any portion of the rehabilitation includes
	alterations that will replace items that are identified as required
	efficiency measures by the department.
	(c)  The energy conservation and efficiency measures the
	department requires under Subsection (b) may not be more stringent
	than the measures the department requires under Subsection (a).
	(d)  The department shall review the measures required to
	meet the energy efficiency standards at least annually to determine
	if additional measures are desirable and to ensure that the most
	recent energy efficiency technology is considered.
	(e)  Subsections (a) and (b) do not apply to a single or
	multifamily dwelling that receives weatherization assistance money
	from the department or money provided under the first-time
	homebuyer program.
	SECTION 10.  Section 301.038, Health and Safety Code, is
	amended to read as follows:
	Sec. 301.038.  PROVISION [COST] OF SERVICES; COSTS.  (a) A
	cooperative association may provide services from a system to
	eligible institutions and may determine the amount to be charged
	for providing the services.
	(b)  Notwithstanding Sections 301.032 and 301.037, a
	cooperative association may provide from a system central heating
	and cooling services, including steam and heated and chilled water
	supply, to persons other than eligible institutions and may
	determine the amount to be charged for providing services.
	SECTION 11.  Section 388.003, Health and Safety Code, is
	amended by adding Subsections (b-1), (b-2), and (b-3) to read as
	follows:
	(b-1)  If the State Energy Conservation Office determines,
	based on written recommendations from the laboratory, that the
	energy efficiency provisions of the latest published editions of
	the International Residential Code or the International Energy
	Conservation Code for residential or commercial energy efficiency
	and air quality are equivalent to or more stringent than the
	provisions of editions adopted under Subsection (a) or (b), the
	office by rule may adopt and substitute in the energy code the
	equivalent or more stringent editions for of the initial editions
	described by Subsection (a) or (b).  If the State Energy
	Conservation Office adopts the latest published editions of the
	International Residential Code or the International Energy
	Conservation Code into the energy code, the office shall establish
	an effective date for the new editions that is not earlier than nine
	months after the date of adoption.  The laboratory shall submit
	recommendations concerning the latest published editions of the
	International Residential Code or the International Energy
	Conservation Code not later than six months after publication of
	new editions.
	(b-2)  The State Energy Conservation Office by rule shall
	establish a procedure for allowing an opportunity for persons who
	have an interest in the adoption of energy efficiency codes under
	Subsection (b-1) to comment on a code considered for adoption,
	including:
	(1)  commercial and residential builders;
	(2)  architects;
	(3)  engineers;
	(4)  county and other local government authorities; and
	(5)  environmental groups.
	(b-3)  In developing written recommendations under
	Subsection (b-1), the laboratory shall consider the comments
	submitted under Subsection (b-2).
	SECTION 12.  Section 388.005, Health and Safety Code, is
	amended to read as follows:
	Sec. 388.005.  ENERGY EFFICIENCY PROGRAMS IN CERTAIN
	GOVERNMENTAL ENTITIES [POLITICAL SUBDIVISIONS].  (a)  In this
	section:
	(1)  "Institution of higher education" includes an
	institution of higher education as defined by Section 61.003,
	Education Code, and a private institution of higher education that
	receives funding from the state.
	(2)  "Political[, "political] subdivision" means:
	(A) [(1)]  an affected county; or
	(B) [(2)]  any political subdivision in a
	nonattainment area or in an affected county other than:
	(i) [(A)]  a school district; or
	(ii) [(B)]  a district as defined by Section
	36.001 or 49.001, Water Code, that had a total annual electricity
	expense of less than $200,000 in the previous fiscal year of the
	district.
	(3)  "State agency" means a department, commission,
	board, office, council, or other agency in the executive branch of
	state government that is created by the constitution or a statute of
	this state and has authority not limited to a geographical portion
	of the state.
	(b)  Each political subdivision, institution of higher
	education, or state agency shall implement all energy efficiency
	measures that meet the standards established for a contract for
	energy conservation measures under Section 302.004(b), Local
	Government Code, in order to reduce electricity consumption by the
	existing facilities of the entity [the political subdivision].
	(c)  Each political subdivision, institution of higher
	education, or state agency shall establish a goal to reduce the
	electric consumption by the entity [political subdivision] by five
	percent each state fiscal year for six [five] years, beginning
	September 1, 2007 [January 1, 2002].
	(d)  A political subdivision, institution of higher
	education, or state agency that does not attain the goals under
	Subsection (c) must include in the report required by Subsection
	(e) justification that the entity [political subdivision] has
	already implemented all available measures.
	(e)  A political subdivision, institution of higher
	education, or state agency annually shall report to the State
	Energy Conservation Office, on forms provided by that office,
	regarding the entity's [political subdivision's] efforts and
	progress under this section.  The State Energy Conservation Office
	shall provide assistance and information to the entity [political
	subdivisions] to help the entity [the political subdivisions] meet
	the goals set under this section.
	(f)  This section does not apply to a state agency or an
	institution of higher education that the State Energy Conservation
	Office determines that, before September 1, 2007, adopted a plan
	for conserving energy under which the agency or institution
	established a percentage goal for reducing the consumption of
	electricity.  The exemption provided by this section applies only
	while the agency or institution has an energy conservation plan in
	effect and only if the agency or institution submits reports on the
	conservation plan each calendar quarter to the governor, the
	Legislative Budget Board, and the State Energy Conservation Office.
	SECTION 13.  Section 388.008, Health and Safety Code, is
	amended by amending Subsections (a) and (c) and adding Subsection
	(d) to read as follows:
	(a)  The laboratory shall develop a standardized report
	format to be used by providers of home energy ratings.  The
	laboratory may develop different report formats for rating newly
	constructed residences from those for existing residences.  The
	form must be designed to give potential buyers information on a
	structure's energy performance, including:
	(1)  insulation;
	(2)  types of windows;
	(3)  heating and cooling equipment;
	(4)  water heating equipment;
	(5)  additional energy conserving features, if any;
	(6)  results of performance measurements of building
	tightness and forced air distribution; and
	(7)  an overall rating of probable energy efficiency
	relative to the minimum requirements of the International Energy
	Conservation Code or the energy efficiency chapter of the
	International Residential Code, as appropriate.
	(c)  The laboratory may cooperate with an industry
	organization or trade association to:
	(1)  develop guidelines for home energy ratings;
	(2)  provide training for individuals performing home
	energy ratings and providers of home energy ratings; and
	(3)  provide a registry of completed ratings for newly
	constructed residences and residential improvement projects for
	the purpose of computing the energy savings and emissions
	reductions benefits of the [The] home energy ratings program [shall
	be implemented by September 1, 2002].
	(d)  The laboratory shall include information on the
	benefits attained from this program in an annual report to the
	commission.
	SECTION 14.  The heading to Section 74.3013, Property Code,
	is amended to read as follows:
	Sec. 74.3013.  DELIVERY OF MONEY FOR RURAL SCHOLARSHIP,
	[AND] ECONOMIC DEVELOPMENT, AND ENERGY EFFICIENCY ASSISTANCE.
	SECTION 15.  Sections 74.3013(a), (b), (e), (f), and (g),
	Property Code, are amended to read as follows:
	(a)  Notwithstanding and in addition to any other provision
	of this chapter or other law, a nonprofit cooperative corporation
	may deliver reported money to a scholarship fund for rural
	students, [or] to stimulate rural economic development, or to
	provide energy efficiency assistance to members of electric
	cooperatives, instead of delivering the money to the comptroller as
	prescribed in Section 74.301.
	(b)  A nonprofit cooperative corporation may deliver the
	money under this section only:
	(1)  to a scholarship fund established by one or more
	nonprofit cooperative corporations in this state to enable students
	from rural areas to attend college, technical school, or other
	postsecondary educational institution; [and]
	(2)  to an economic development fund for the
	stimulation and improvement of business and commercial activity for
	economic development in rural communities; and
	(3)  to an energy efficiency assistance fund to assist
	members of an electric cooperative in reducing their energy
	consumption and electricity bills.
	(e)  The comptroller shall prescribe forms and procedures
	governing this section, including forms and procedures relating to:
	(1)  notice of presumed abandoned property;
	(2)  delivery of reported money to a scholarship, [or]
	economic development fund, or energy efficiency assistance fund;
	(3)  filing of a claim; and
	(4)  procedures to allow equitable opportunity for
	participation by each nonprofit cooperative corporation in the
	state.
	(f)  During a state fiscal year the total amount of money
	that may be transferred by all nonprofit cooperative corporations
	under this section may not exceed $2 [$1] million.  No more than 20
	percent of each nonprofit cooperative's funds eligible for delivery
	under this section shall be used for economic development.  The
	comptroller shall adopt procedures to record the total amount of
	money transferred annually [to allow equitable opportunity for
	participation with preference given to corporations already
	providing similar scholarship opportunities in other states].
	(g)  Nonprofit cooperative corporations may combine
	[economic development] funds from other sources with any [economic
	development] funds delivered under this section.  In addition, such
	cooperatives may engage in other business and commercial
	activities, in their own behalf or through such subsidiaries and
	affiliates as deemed necessary, in order to provide and promote
	educational opportunities and to stimulate rural economic
	development.
	SECTION 16.  Subchapter H, Chapter 151, Tax Code, is amended
	by adding Section 151.333 to read as follows:
	Sec. 151.333.  ENERGY-EFFICIENT PRODUCTS.  (a)  In this
	section, "energy-efficient product" means a product that has been
	designated as an Energy Star qualified product under the Energy
	Star program jointly operated by the United States Environmental
	Protection Agency and the United States Department of Energy.
	(b)  This section applies only to the following
	energy-efficient products:
	(1)  an air conditioner the sales price of which does
	not exceed $6,000;
	(2)  a clothes washer;
	(3)  a ceiling fan;
	(4)  a dehumidifier;
	(5)  a dishwasher;
	(6)  an incandescent or fluorescent lightbulb;
	(7)  a programmable thermostat; and
	(8)  a refrigerator the sales price of which does not
	exceed $2,000.
	(c)  The sale of an energy-efficient product to which this
	section applies is exempted from the taxes imposed by this chapter
	if the sale takes place during a period beginning at 12:01 a.m. on
	the Saturday preceding the last Monday in May (Memorial Day) and
	ending at 11:59 p.m. on the last Monday in May.
	SECTION 17.  Subchapter A, Chapter 313, Tax Code, is amended
	by adding Section 313.008 to read as follows:
	Sec. 313.008.  REPORT ON COMPLIANCE WITH ENERGY-RELATED
	AGREEMENTS.  (a)  Before the beginning of each regular session of
	the legislature, the comptroller shall submit to the lieutenant
	governor, the speaker of the house of representatives, and each
	member of the legislature a report assessing the progress of each
	agreement entered into under this chapter utilizing data certified
	by agreement recipients, on each agreement entered into under this
	chapter involving energy-related projects, including wind
	generation, ethanol production, liquefied natural gas terminals,
	low sulfur diesel production, refinery cogeneration, and nuclear
	energy production.  The report must state for each agreement:
	(1)  the number of qualifying jobs each recipient of a
	limitation on appraised value committed to create;
	(2)  the number of qualifying jobs each recipient
	created;
	(3)  the median wage of the new jobs each recipient
	created;
	(4)  the amount of the qualified investment each
	recipient committed to expend or allocate per project;
	(5)  the amount of the qualified investment each
	recipient expended or allocated per project;
	(6)  the market value of the qualified property of each
	recipient as established by the local appraiser;
	(7)  the limitation on appraised value for the
	qualified property of each recipient;
	(8)  the dollar amount of the ad valorem taxes that
	would have been imposed on the market value of the qualified
	property;
	(9)  the dollar amount of the ad valorem taxes imposed
	on the qualified property;
	(10)  the number of new jobs created by each recipient
	in each sector of the North American Industry Classification System
	(NAICS); and
	(11)  of the number of new jobs each recipient created,
	the number of positions created that provide health benefits for
	employees.
	(b)  The report may not include information that is made
	confidential by law.
	(c)  The comptroller may require a recipient to submit, on a
	form provided by the comptroller, information required to complete
	the report.
	SECTION 18.  Section 31.004, Utilities Code, is amended by
	adding Subsection (c) to read as follows:
	(c)  The commission shall provide information to school
	districts regarding how a school district may finance the
	installation of solar electric generation panels for school
	district buildings.
	SECTION 19.  Section 39.002, Utilities Code, is amended to
	read as follows:
	Sec. 39.002.  APPLICABILITY.  This chapter, other than
	Sections 39.155, 39.157(e), 39.203, 39.903, [and] 39.904, 39.9051,
	39.9052, and 39.914(e), does not apply to a municipally owned
	utility or an electric cooperative. Sections 39.157(e), 39.203, and
	39.904, however, apply only to a municipally owned utility or an
	electric cooperative that is offering customer choice. If there is
	a conflict between the specific provisions of this chapter and any
	other provisions of this title, except for Chapters 40 and 41, the
	provisions of this chapter control.
	SECTION 20.  Section 39.107, Utilities Code, is amended by
	adding Subsection (i) to read as follows:
	(i)  Subject to the restrictions in Subsection (h), it is the
	intent of the legislature that net metering and advanced meter
	information networks be deployed as rapidly as possible to allow
	customers to better manage energy use and control costs, and to
	facilitate demand response initiatives.
	SECTION 21.  Subchapter Z, Chapter 39, Utilities Code, is
	amended by adding Section 39.9025 to read as follows:
	Sec. 39.9025.  HOME ELECTRIC ENERGY REPORTS.  The commission
	may encourage retail electric providers to deliver individualized
	home electric energy reports to educate consumers about electric
	energy use and energy efficiency to assist consumers to use energy
	more efficiently.
	SECTION 22.  Section 39.905, Utilities Code, is amended by
	amending Subsections (a), (b), (d), (e), and (f) and adding
	Subsections (b-1), (b-2), (b-3), (b-4), and (g) to read as follows:
	(a)  It is the goal of the legislature that:
	(1)  electric utilities will administer energy
	efficiency [savings] incentive programs in a market-neutral,
	nondiscriminatory manner but will not offer underlying competitive
	services;
	(2)  all customers, in all customer classes, will have
	a choice of and access to energy efficiency alternatives and other
	choices from the market that allow each customer to reduce energy
	consumption, peak demand, or energy costs; [and]
	(3)  each electric utility will provide, through
	market-based standard offer programs or limited, targeted,
	market-transformation programs, incentives sufficient for retail
	electric providers and competitive energy service providers to
	acquire additional cost-effective energy efficiency for
	residential and commercial customers equivalent to at least:
	(A)  10 percent of the electric utility's annual
	growth in demand of residential and commercial customers by
	December 31, 2007;
	(B)  15 percent of the electric utility's annual
	growth in demand of residential and commercial customers by
	December 31, 2008, provided that the electric utility's program
	expenditures for 2008 funding may not be greater than 75 percent
	above the utility's program budget for 2007 for residential and
	commercial customers, as included in the April 1, 2006, filing; and
	(C)  20 percent of the electric utility's annual
	growth in demand of residential and commercial customers by
	December 31, 2009, provided that the electric utility's program
	expenditures for 2009 funding may not be greater than 150 percent
	above the utility's program budget for 2007 for residential and
	commercial customers, as included in the April 1, 2006, filing;
	(4)  each electric utility in the ERCOT region shall
	use its best efforts to encourage and facilitate the involvement of
	the region's retail electric providers in the delivery of
	efficiency programs and demand response programs under this
	section;
	(5)  retail electric providers in the ERCOT region, and
	electric utilities outside of the ERCOT region, shall provide
	customers with energy efficiency educational materials; and
	(6)  notwithstanding Subsection (a)(3), electric
	utilities shall continue to make available, at 2007 funding and
	participation levels, any load management standard offer programs
	developed for industrial customers and implemented prior to May 1,
	2007.
	(b)  The commission shall provide oversight and adopt rules
	and procedures[, as necessary,] to ensure that the utilities can
	achieve the goal of this section, including:
	(1)  establishing an energy efficiency cost recovery
	factor for ensuring timely and reasonable cost recovery for utility
	expenditures made to satisfy the goal of this section;
	(2)  establishing an incentive under Section 36.204 to
	reward utilities administering programs under this section that
	exceed the minimum goals established by this section;
	(3)  providing a utility that is unable to establish an
	energy efficiency cost recovery factor in a timely manner due to a
	rate freeze with a mechanism to enable the utility to:
	(A)  defer the costs of complying with this
	section; and
	(B)  recover the deferred costs through an energy
	efficiency cost recovery factor on the expiration of the rate
	freeze period;
	(4)  ensuring that the costs associated with programs
	provided under this section are borne by the customer classes that
	receive the services under the programs; and
	(5)  ensuring the program rules encourage the value of
	the incentives to be passed on to the end-use customer.
	(b-1)  The energy efficiency cost recovery factor under
	Subsection (b)(1) may not result in an over-recovery of costs but
	may be adjusted each year to change rates to enable utilities to
	match revenues against energy efficiency costs and any incentives
	to which they are granted. The factor shall be adjusted to reflect
	any over-collection or under-collection of energy efficiency cost
	recovery revenues in previous years.
	(b-2)  The commission shall conduct a study, to be funded by
	electric utilities, regarding cost-effective energy efficiency in
	this state. Not later than January 15, 2009, the commission shall
	submit to the legislature a report regarding the commission's
	findings that:
	(1)  considers the technical, economic, and achievable
	potential, and natural occurrence of energy efficiency in this
	state in terms of kilowatts and kilowatt hours for each element;
	(2)  determines the amount of savings that is
	achievable through utility programs in compliance with commission
	rules;
	(3)  recommends whether:
	(A)  utility funding of energy efficiency in areas
	of the state with competitive retail electric service should
	continue;
	(B)  energy efficiency in areas with competitive
	retail electric service is best provided by the competitive market;
	and
	(C)  utilities should fund education programs to
	be conducted by the commission regarding the provision of energy
	efficiency service from the competitive market;
	(4)  provides estimates of achievable savings specific
	to each utility service area and each customer class;
	(5)  quantifies the costs and rate impacts associated
	with meeting energy efficiency goals;
	(6)  determines whether an increase in the goal to 30
	percent of the growth in demand for each utility is achievable by
	December 31, 2010, and whether an increase in the goal to 50 percent
	of the growth in demand for electricity is achievable by December
	31, 2015, by each utility in the service area served through the
	energy efficiency programs described by this section;
	(7)  recommends policies designed to promote energy
	efficiency in the areas of the state that are not served by the
	utilities which administer programs under this section; and
	(8)  identifies potential barriers to the increased
	participation by retail electric providers in the delivery of
	energy efficiency services to ERCOT customers, and to the increased
	potential for energy efficiency in ERCOT or in this state
	generally, including any recommended regulatory or statutory
	changes to eliminate such barriers or facilitate greater
	efficiency.
	(b-3)  Beginning not later than January 1, 2008, the
	commission, in consultation with the State Energy Conservation
	Office, annually for a period of five years shall compute and report
	to ERCOT the projected energy savings and demand impacts for each
	entity in the ERCOT region that administers standard offer
	programs, market transformation programs, combined heating and
	power technology, demand response programs, solar incentive
	programs, appliance efficiency standards, energy efficiency
	programs in public buildings, and any other relevant programs that
	are reasonably anticipated to reduce electricity energy or peak
	demand or that serve as substitutes for electric supply.
	(b-4)  The commission and ERCOT shall develop a method to
	account for the projected efficiency impacts under Subsection (b-3)
	in ERCOT's annual forecasts of future capacity, demand, and
	reserves.
	(d)  The commission shall establish a procedure for
	reviewing and evaluating market-transformation program options
	described by this subsection and other options. In evaluating
	program options, the commission may consider the ability of a
	program option to reduce costs to customers through reduced demand,
	energy savings, and relief of congestion.  Utilities [adopt the
	following market-transformation program options that the
	utilities] may choose to implement any program option approved by
	the commission after its evaluation in order to satisfy the goal in
	Subsection (a), including [(a)(3)]:
	(1)  energy-smart schools;
	(2)  appliance retirement and recycling;
	(3)  air conditioning system tune-ups; [and]
	(4)  the use of trees or other landscaping for energy
	efficiency;
	(5)  customer energy management and demand response
	programs;
	(6)  high performance residential and commercial
	buildings that will achieve the levels of energy efficiency
	sufficient to qualify those buildings for federal tax incentives;
	(7)  programs for customers who rent or lease their
	residence or commercial space;
	(8)  programs providing energy monitoring equipment to
	customers that enable a customer to better understand the amount,
	price, and time of the customer's energy use;
	(9)  energy audit programs for owners and other
	residents of single-family or multifamily residences and for small
	commercial customers;
	(10)  net-zero energy new home programs;
	(11)  solar thermal or solar electric programs; and
	(12)  programs for using windows and other glazing
	systems, glass doors, and skylights in residential and commercial
	buildings that reduce solar gain by at least 30 percent from the
	level established for the federal Energy Star windows program.
	(e)  An electric utility may use money approved by the
	commission for energy efficiency programs to perform necessary
	energy efficiency research and development to foster continuous
	improvement and innovation in the application of energy efficiency
	technology and energy efficiency program design and
	implementation.  Money the utility uses under this subsection may
	not exceed 10 percent of the greater of:
	(1)  the amount the commission approved for energy
	efficiency programs in the utility's most recent full rate
	proceeding; or
	(2)  the commission-approved expenditures by the
	utility