Relating to risk mitigation planning and associated liability for providers of electric service; providing an administrative penalty, the official text

H.B. No. 145

AN ACT

relating to risk mitigation planning and associated liability for

providers of electric service; providing an administrative

penalty.

BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:

SECTION 1. Section 36.064, Utilities Code, is amended by

amending Subsections (a) and (b) and adding Subsections (c-1) and

(h) to read as follows:

(a) An electric utility may self-insure all or part of:

(1) the utility's potential liability or catastrophic

property loss, including windstorm, fire, wildfire, and explosion

losses, that could not have been reasonably anticipated and

included under operating and maintenance expenses; and

(2) potential damages the utility may be liable for

resulting from personal injury or property damage caused by a

wildfire.

(b) The commission shall approve a self-insurance plan

under this section if the commission finds [that]:

(1) the coverage is in the public interest;

(2) one of the following:

(A) the plan, considering all costs, is a lower

cost alternative to purchasing commercial insurance;

(B) commercial insurance alone is insufficient

to cover potential liability, damages, or catastrophic property

loss; or

(C) the electric utility cannot obtain

commercial insurance for a reasonable premium; and

(3) ratepayers will receive the benefits of the

savings.

(c-1) In approving a self-insurance plan under this

section, the commission shall prioritize the consideration of the

presence and potential extent of wildfire losses, including:

(1) historical data;

(2) actuarial studies and analyses; and

(3) the risk of the electric utility's exposure to

losses from multiple types of disasters occurring within the

utility's service territory.

(h) Subsection (a)(2) does not authorize an electric

utility to self-insure under this section for damages from a

wildfire event the utility caused intentionally, recklessly, or

with gross negligence.

SECTION 2. Subchapter D, Chapter 38, Utilities Code, is

amended by adding Sections 38.080 and 38.081 to read as follows:

Sec. 38.080. WILDFIRE MITIGATION PLAN. (a) In this

section:

(1) "Division" means the Texas Division of Emergency

Management.

(2) "First responder" has the meaning assigned by

Section 418.251, Government Code.

(3) "Plan" means a wildfire mitigation plan described

by Subsection (b).

(4) "Wildfire risk area" means an area determined by

the division or an electric utility, municipally owned utility, or

electric cooperative to be at an elevated risk for wildfire.

(b) An electric utility, municipally owned utility, or

electric cooperative that owns a transmission or distribution

facility in a wildfire risk area shall file with the commission a

wildfire mitigation plan that includes the following:

(1) a description of each area to which the utility or

cooperative provides transmission or distribution service that is

in a wildfire risk area and the utility's or cooperative's process

for periodically inspecting the utility's or cooperative's

transmission and distribution facilities in those areas;

(2) a detailed plan for vegetation management in the

wildfire risk area;

(3) a detailed operations plan for reducing the

likelihood of wildfire ignition from the utility's or cooperative's

facilities and for responding to a wildfire;

(4) a description of the procedures the utility or

cooperative intends to use to restore the utility's or

cooperative's system during and after a wildfire event, including

contact information for the utility or cooperative that may be used

for coordination with the division and first responders;

(5) the utility's or cooperative's community outreach

and public awareness plan regarding wildfire risks and actual

wildfires affecting the utility's or cooperative's service

territory or system, including a specific communications plan for

responding to a wildfire event;

(6) any infrastructure report, maintenance report, or

transmission or distribution pole maintenance plan required by the

commission;

(7) an analysis of the wildfire mitigation plan

prepared by an independent expert in fire risk mitigation;

(8) a description of procedures for de-energizing

power lines and disabling reclosers to mitigate potential wildfires

or implement a public safety power shut-off plan;

(9) a description of the procedures and standards that

the utility or cooperative will use to inspect and operate the

utility's or cooperative's infrastructure to mitigate the risk of

wildfires;

(10) a description of how the utility or cooperative

will monitor compliance with the wildfire mitigation plan; and

(11) any other information the commission may require.

(c) The commission shall issue an order not later than the

180th day after a plan is filed with the commission that:

(1) approves the plan if the commission finds that

approval is in the public interest; or

(2) modifies or rejects the plan as necessary to be

consistent with the public interest.

(d) An electric utility, municipally owned utility, or

electric cooperative that does not implement a plan approved under

this section is subject to an administrative penalty as provided by

Chapter 15.

(e) The commission may accept in place of the information

required under Subsection (b) any information required under other

law that is substantially similar to the information required under

that subsection.

Sec. 38.081. EVIDENCE IN ACTIONS FOR DAMAGES CAUSED BY

WILDFIRE. (a) An electric utility, municipally owned utility, or

electric cooperative that submits and obtains commission approval

for a wildfire mitigation plan under Section 38.080 may use the plan

as evidence in an action brought against the utility or cooperative

for damages resulting from a wildfire ignited or propagated by the

utility's or cooperative's facility.

(b) Subject to any applicable tariff provision, in an action

for damages resulting from a wildfire ignited or propagated by an

electric utility's, municipally owned utility's, or electric

cooperative's facility, the utility or cooperative is not liable

for damages resulting from the wildfire if the trier of fact in the

action finds that the utility or cooperative:

(1) submitted, obtained commission approval for, and

implemented a wildfire mitigation plan under Section 38.080;

(2) was in compliance with relevant measures of the

utility's or cooperative's wildfire mitigation plan with respect to

the specific equipment found to have ignited or propagated the

wildfire; and

(3) did not cause the wildfire intentionally,

recklessly, or with negligence.

(c) Subsections (a) and (b) do not apply to an electric

utility, municipally owned utility, or electric cooperative that:

(1) does not file a wildfire mitigation plan under

Section 38.080; or

(2) files a plan that is rejected by the commission.

(d) Notwithstanding any other provision of this section,

this section does not affect an express contractual right of a

person or entity involving a communications facility or the shared

use of an electric facility or pole attachment.

SECTION 3. (a) The Public Utility Commission of Texas

shall adopt any rules necessary to implement Section 36.064,

Utilities Code, as amended by this Act, and Section 38.080,

Utilities Code, as added by this Act, not later than the 180th day

after the effective date of this Act.

(b) An electric utility, municipally owned utility, or

electric cooperative shall file a wildfire mitigation plan, as

authorized by Section 38.080, Utilities Code, as added by this Act,

as soon as practicable after the date the Public Utility Commission

of Texas adopts rules described by Subsection (a) of this section.

SECTION 4. Section 38.081, Utilities Code, as added by this

Act, applies only to a cause of action that accrues on or after the

effective date of this Act.

SECTION 5. This Act takes effect immediately if it receives

a vote of two-thirds of all the members elected to each house, as

provided by Section 39, Article III, Texas Constitution. If this

Act does not receive the vote necessary for immediate effect, this

Act takes effect September 1, 2025.

______________________________
______________________________

President of the Senate
Speaker of the House

I certify that H.B. No. 145 was passed by the House on April

25, 2025, by the following vote: Yeas 131, Nays 8, 1 present, not

voting; that the House refused to concur in Senate amendments to

H.B. No. 145 on May 28, 2025, and requested the appointment of a

conference committee to consider the differences between the two

houses; and that the House adopted the conference committee report

on H.B. No. 145 on May 31, 2025, by the following vote: Yeas 103,

Nays 21, 2 present, not voting.

______________________________

Chief Clerk of the House

I certify that H.B. No. 145 was passed by the Senate, with

amendments, on May 26, 2025, by the following vote: Yeas 31, Nays

0; at the request of the House, the Senate appointed a conference

committee to consider the differences between the two houses; and

that the Senate adopted the conference committee report on H.B. No.

145 on June 1, 2025, by the following vote: Yeas 31, Nays 0.

______________________________

Secretary of the Senate

APPROVED: __________________

Date

__________________

Governor