| (e) Copies of contracts or agreements. A TDBU shall reduce
to writing and file with the commission copies of any contracts or agreements
it has with its competitive affiliates. The filing of an earnings report does
not satisfy the requirements of this section. All contracts or agreements
shall be filed by June 1 of each year as attachments to the annual report
of code-related activities required in subsection (d) of this section. In
subsequent years, if no significant changes have been made to the contract
or agreement, an amendment sheet may be filed in lieu of refiling the entire
contract or agreement.
(f) Tracking migration and sharing of employees. An MOU/COOP
shall track and document the movement between the TDBU and its competitive
affiliates of all employees engaged in transmission or distribution system
operations, including persons employed by the MOU/COOP who are engaged in
transmission or distribution system operations on a day-to-day basis or who
have knowledge of transmission or distribution system operations. An MOU/COOP
shall also document the assignment of shared employees engaged in both transmission
or distribution system operations and competitive energy-related activities,
if any. Employee migration and sharing information shall be included in the
MOU/COOP's annual report of code-related activities. For migrating employees,
the tracking information shall include an identification code, the respective
titles held while employed at the TDBU and the competitive affiliate, and
the effective dates of the migration. For shared employees, the tracking information
shall include the employees' name, job title, scope of activities, and allocation
of time to transmission and distribution functions and competitive energy-related
activities.
(g) Reporting deviations from the code of conduct. A TDBU shall
report information regarding the instances in which deviations from this section
were necessary to ensure public safety or system reliability pursuant to this
section. The information reported shall include the nature of the circumstances
involved and the date of the deviation. Within 30 days of each deviation relating
to a competitive affiliate, the MOU/COOP shall report this information to
the commission and shall conspicuously post the information on its Internet
site or a public electronic bulletin board for 30 consecutive calendar days.
Information regarding a deviation shall be summarized in the MOU/COOP's annual
report of code-related activities.
(h) Ensuring compliance for new competitive affiliates. An
MOU/COOP and a new competitive affiliate are bound by this code of conduct,
to the extent applicable, immediately upon creation of the new competitive
affiliate. The MOU/COOP shall post a conspicuous notice of any newly created
competitive affiliates on its Internet site or a public electronic bulletin
board for 30 consecutive calendar days. Additionally, the MOU/COOP shall ensure
that its annual report of code-related activities reflects all changes that
result from the creation of new competitive affiliates.
(i) Separation of a TDBU from its competitive affiliates.
(1) Sharing of employees, officers and directors, property,
equipment, computer and information systems, other resources, and corporate
support services. An MOU/COOP and its competitive affiliate may share common
employees, officers and trustees/directors, property, equipment, computer
and information systems, other resources, and corporate support services,
if the TDBU implements safeguards that the commission determines are adequate
to preclude employees of a competitive affiliate from gaining access to confidential
information in a manner that would allow or provide a means to transfer confidential
information from the TDBU to the competitive affiliate, create an opportunity
for preferential treatment or unfair competitive advantage, lead to customer
confusion, or create significant opportunities for cross-subsidization of
a competitive affiliate.
(2) Employee transfers and temporary assignments.
(A) An MOU/COOP shall not assign to a competitive affiliate
for less than one year employees engaged in transmission or distribution system
operations unless safeguards are in place to prevent transfer of confidential
information. TDBU employees engaged in transmission or distribution system
operations, including persons employed by a structurally unbundled service
company affiliate of the TDBU who are engaged on a day-to-day basis in or
have knowledge of transmission or distribution system operations and are transferred
to a competitive affiliate, shall not remove or otherwise provide or use confidential
information or information gained from the TDBU or affiliated service company,
in a discriminatory or exclusive fashion to the benefit of the competitive
affiliate or to the detriment of non-affiliated electric suppliers.
(B) Movement of employees to a competitive affiliate may be
accomplished either through the employee's termination of employment with
the TDBU and acceptance of employment with the CS or through a transfer to
the CD as long as the transfer results in the TDBU bearing no ongoing costs
associated with that employee.
(C) Transferring employees shall sign a statement indicating
that they are aware of and understand the restrictions set forth in this section.
The TDBU also shall post a conspicuous notice of such a transfer on its Internet
site or other public electronic bulletin board within 24 hours and for at
least 30 consecutive calendar days.
(D) Employees may be temporarily assigned to an affiliate or
non-affiliated TDBU to assist in restoring power in the event of a major service
interruption or to assist in resolving emergency situations affecting system
reliability. Any such deviation shall be reported and posted on the TDBU's
Internet site or other public electronic bulletin board within 24 hours and
for at least 30 consecutive calendar days.
(3) Sharing of office space. A TDBU's office space shall be
physically separate from the office space of its competitive affiliates. Physical
separation is accomplished by having office space in separate buildings or,
if within the same building, by a method such as having offices on separate
floors or with separate access.
(4) Separate books and records. A TDBU shall maintain separate
books of accounts and records from those of any CS. In a proceeding under
subsection (n)(3) of this section, the commission may review records relating
to a transaction between a TDBU and a CS. Costs of CDs, other than those costs
related to corporate support services, shall be segregated by account.
(A) In accordance with generally accepted accounting principles,
a TDBU shall record all transactions with its CS whether they involve direct
or indirect expenses, and all transactions with CDs that relate to the transmission
and distribution function.
(B) A TDBU shall prepare financial statements that are not
consolidated with those of a CS.
(5) Limitations on credit support by a TDBU for a competitive
affiliate. A TDBU and its affiliates may share credit, investment, or financing
arrangements with a competitive affiliate if the TDBU implements adequate
safeguards precluding employees of a competitive affiliate from gaining access
to information in a manner that would allow or provide a means to transfer
confidential information from the TDBU to the competitive affiliate or lead
to customer confusion. Nothing in this section shall impair existing contracts,
covenants, or obligations between an MOU/COOP and its lenders and holders
of bonds issued on behalf of or by an MOU/COOP.
(A) MOU. In issuing debt related to competitive affiliates,
an MOU shall be governed by and maintained, operated, and managed in accordance
with the laws of the State of Texas, including the ordinances and resolutions
authorizing the issuance of any form of indebtedness and the provisions thereof,
which require that funds reasonably necessary for operation and maintenance
expenses (including TDBU operation and maintenance expenses) have priority
in any pledge of gross revenues of the municipally owned utility system.
(B) COOP. A COOP TDBU shall not allow a competitive affiliate
to obtain credit under any arrangement that would include a specific pledge
of assets reasonably necessary for TDBU operations or a pledge of gross revenues
of the TDBU.
(j) Transactions between a TDBU and its competitive affiliates.
(1) Transactions with competitive affiliates. Except for transfers
implementing unbundling, transfers of property pursuant to a rate order having
the effect of a financing order, credit support, and corporate support services
provided by a TDBU to its competitive affiliate, any transaction between a
TDBU and its competitive affiliate shall be accomplished at pricing levels
that are fair and reasonable to the customers of the TDBU and that reflect
the approximate market value of the assets or the fully allocated cost of
the assets, services, or products, and that do not include any preferential
discounts, rebates, fee waivers or alternative tariff terms and conditions.
Such transfers include, but are not limited to, the following:
(A) sale or provision of products or services by a TDBU to
its competitive affiliate;
Cont'd... |
