The Public Utility Commission of Texas (PUC) is the state agency responsible for the economic regulation of electric, water, and sewer utilities in Texas. Its authority covers rates, service areas, and market oversight, while the Texas Commission on Environmental Quality (TCEQ) retains responsibility for environmental and public-health standards.
The PUC also oversees the Electric Reliability Council of Texas (ERCOT), which operates the state’s electric grid. The agency employs about 200 staff members under the direction of a five-member commission. Both the agency as a whole, and its governing body, are referred to as the Public Utility Commission.
Agency Structure
The PUC’s five commissioners are appointed by the Governor and confirmed by the Texas Senate for staggered six-year terms.
Prior to 2021, the commission had only three members, but following the widespread power outages during Winter Storm Uri, the Legislature expanded membership to five and revised eligibility requirements to limit potential industry conflicts of interest.
Day-to-day operations are led by an executive director, who reports directly to the commission. Major program areas include Customer Protection, Competitive Markets, Infrastructure, and the Office of Policy and Docket Management.
History of the Public Utility Commission
The Public Utility Commission dates to 1975, when the legislature passed the Public Utility Regulatory Act to provide statewide regulation of the rates and services of electric and telecommunications utilities.
For the next twenty years, the agency’s primary role was traditional cost-of-service rate regulation of electric and telecommunications utilities. Additionally, the agency issued Certificates of Convenience and Necessity (CCN), which grant the holder the exclusive right to provide retail water or sewer utility service to an identified geographic area.
That system lasted until 1995, when the legislature deregulated the wholesale electricity market. That reform altered the role of the PUC from hands-on regulation of rates to a more hands-off role. In 1999, the legislature restructured the retail side of the industry, further changing the PUC’s mission and focus.
In 2013, the Texas Legislature added the economic regulation of water utilities to the agency’s responsibilities. PUC regulates water and sewer utilities’ rates and services areas, while the Texas Commission on Environmental Quality (TCEQ) maintains regulatory authority over health and safety standards.
PUC also has limited authority to regulate telecommunications, though the federal government plays a more prominent role in that industry. In a September 2020 report, the PUC stated that its “traditional regulatory functions related to telecommunications regulation have markedly decreased over the past decade.”
The agency underwent another overhaul in 2021 after Winter Storm Uri. The legislature tweaked the PUC’s role, but did not fundamentally roll back the market-based system put into place in the 1990s.
Consumer Complaints
PUC is also responsible for offering utility customers assistance in resolving complaints. Consumers can file a complaint with PUC if they have first contacted their provider and allowed them to investigate the complaint.
A formal complaint at the PUC is similar to a court case and may result in a hearing, which is much like a trial. Complaints are investigated by the agency’s Customer Protection Division.
PUC also maintains the state’s “No Call List” for telemarketing.
