Tex. Codes » Utilities Code · TITLE 2. PUBLIC UTILITY REGULATORY ACT · SUBTITLE B. ELECTRIC UTILITIES · CHAPTER 37. CERTIFICATES OF CONVENIENCE AND NECESSITY
Texas Codes

Tex. Util. Code § 37.051 (2026)

Certificate Required

✓ current as of May 2026
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Sec. 37.051. CERTIFICATE REQUIRED. (a) An electric utility may not directly or indirectly provide service to the public under a franchise or permit unless the utility first obtains from the commission a certificate that states that the public convenience and necessity requires or will require the installation, operation, or extension of the service.

(b) Except as otherwise provided by this chapter, a retail electric utility may not furnish or make available retail electric utility service to an area in which retail electric utility service is being lawfully furnished by another retail electric utility unless the utility first obtains a certificate that includes the area in which the consuming facility is located.

(c) Notwithstanding any other provision of this chapter, including Subsection (a), an electric cooperative is not required to obtain a certificate of public convenience and necessity for the construction, installation, operation, or extension of any generating facilities or necessary interconnection facilities.

(c-1) Notwithstanding any other provision of this title except Section 11.009, and except as provided by Subsection (c-2), a person, including an electric utility or municipally owned utility, may not interconnect a facility to the ERCOT transmission grid that enables additional power to be imported into or exported out of the ERCOT power grid unless the person obtains a certificate from the commission stating that public convenience and necessity requires or will require the interconnection. The person must apply for the certificate not later than the 180th day before the date the person seeks any order from the Federal Energy Regulatory Commission related to the interconnection. The commission shall apply Section 37.056 in considering an application under this subsection. In addition, the commission must determine that the application is consistent with the public interest before granting the certificate. The commission may adopt rules necessary to implement this subsection. This subsection does not apply to a facility that is in service on December 31, 2014.

(c-2) The commission, not later than the 185th day after the date the application is filed, shall approve an application filed under Subsection (c-1) for a facility that is to be constructed under an interconnection agreement appended to an offer of settlement approved in a final order of the Federal Energy Regulatory Commission that was issued in Docket No. TX11-01-001 on or before December 31, 2014, directing physical connection between the ERCOT and SERC regions under Sections 210, 211, and 212 of the Federal Power Act (16 U.S.C. Sections 824i, 824j, and 824k). In approving the application, the commission may prescribe reasonable conditions to protect the public interest that are consistent with the final order of the Federal Energy Regulatory Commission.

(c-3) Nothing in Subsection (c-1) or (c-2) is intended to restrict the authority of the commission or the independent organization certified under Section 39.151 for the ERCOT power region to adopt rules or protocols of general applicability.

(d) Repealed by Acts 2019, 86th Leg., R.S., Ch. 44 (S.B. 1938), Sec. 8, eff. May 16, 2019.

(e) Repealed by Acts 2019, 86th Leg., R.S., Ch. 44 (S.B. 1938), Sec. 8, eff. May 16, 2019.

(f) Repealed by Acts 2019, 86th Leg., R.S., Ch. 44 (S.B. 1938), Sec. 8, eff. May 16, 2019.

(g) A municipally owned utility or a municipal power agency created under Chapter 163 may not directly or indirectly construct, install, or extend a transmission facility outside of the municipal boundaries of the municipality that owns the municipally owned utility, or the power agency's boundaries, which for the purposes of this subsection consist of the municipal boundaries of the participating public entities, unless the municipally owned utility or power agency first obtains from the commission, through the application process provided by Section 37.053, a certificate that states that the public convenience and necessity requires or will require the transmission facility. Section 37.056 applies to an application under this subsection. This subsection does not apply to a transmission facility placed in service after September 1, 2015, that is developed to interconnect a new natural gas generation facility to the ERCOT transmission grid and for which, on or before January 1, 2015, a municipally owned utility was contractually obligated to purchase at least 190 megawatts of capacity.

(h) The commission shall adopt rules as necessary to provide exemptions to the application of Subsection (g) that are similar to the exemptions to the application of this section to an electric utility, including exemptions for:

(1) upgrades to an existing transmission line that do not require any additional land, right-of-way, easement, or other property not owned by the municipally owned utility; and

(2) the construction, installation, or extension of a transmission facility that is entirely located not more than 10 miles outside of a municipally owned utility's certificated service area that occurs before September 1, 2021.

(i) The commission, not later than the 185th day after the date the application is filed, shall approve an application filed under Subsection (g) for a facility that is to be constructed under an interconnection agreement appended to an offer of settlement approved in a final order of the Federal Energy Regulatory Commission that was issued in Docket No. TX11-01-001 on or before December 31, 2014, directing physical connection between the ERCOT and SERC regions under Sections 210, 211, and 212 of the Federal Power Act (16 U.S.C. Sections 824i, 824j, and 824k). In approving the application, the commission may prescribe reasonable conditions to protect the public interest that are consistent with the final order of the Federal Energy Regulatory Commission.

Acts 1997, 75th Leg., ch. 166, Sec. 1, eff. Sept. 1, 1997. Amended by Acts 1999, 76th Leg., ch. 405, Sec. 30, eff. Sept. 1, 1999.

Amended by:

Acts 2009, 81st Leg., R.S., Ch. 1170 (H.B. 3309), Sec. 2, eff. June 19, 2009.

Acts 2015, 84th Leg., R.S., Ch. 1162 (S.B. 776), Sec. 1, eff. September 1, 2015.

Acts 2015, 84th Leg., R.S., Ch. 1275 (S.B. 933), Sec. 1, eff. September 1, 2015.

Acts 2019, 86th Leg., R.S., Ch. 44 (S.B. 1938), Sec. 1, eff. May 16, 2019.

Acts 2019, 86th Leg., R.S., Ch. 44 (S.B. 1938), Sec. 8, eff. May 16, 2019.

Notes of Decisions
Cited in 14 cases (1 in the last 5 years), 2001–2021 · leading case: Pub. Util. Comm'n v. Cities of Harlingen, 311 S.W.3d 610 (Tex. App. 2010).
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Pub. Util. Comm'n v. Cities of Harlingen, 311 S.W.3d 610 (Tex. App. 2010). · cites it 4× “ETT applied to the Commission for a CCN to provide service as an electric utility in Texas, see Tex. Util.Code Ann. § 37.051(a) (West 2007), for approval of the transactions to form, capitalize, and structure ETT, see id.”
Lamb Cnty. Elec. Coop., Inc. v. Pub. Util. Comm'n, 269 S.W.3d 260 (Tex. App. 2008). · cites it 3× “; see also Tex. Util.Code Ann. § 37.051 (West 2007) (requiring utility to obtain permit before directly or indirectly providing service to public).”
Denton Cnty. Elec. Coop., Inc. v. Eldorado Ranch, Ltd. (In Re Denton Cnty. Elec. Coop., Inc.), 281 B.R. 876 (Bankr. N.D. Tex. 2002). “See Tex. Util.Code Ann. § 37.051 (LexisNex-is, LEXIS through 2001 Sess.”
Coastal Habitat All. v. Patterson, 601 F. Supp. 2d 868 (W.D. Tex. 2008). “See Tex. Util.Code Ann. § 37.051(a). Defendants argue the Private Defendants’ wind farms are exempt wholesale generators and have been excluded from the definition of electric utilities and the Certificate requirement since September 1, 1995.”
Lamb Cnty. Elec. Coop., Inc. v. Pub. Util. Comm'n of Texas (Tex. App. 2008). · cites it 3× “Tex. Util. Code Ann. § 37.051 (b) (emphasis added).”
Lamb Cnty. Elec. Coop., Inc. v. Pub. Util. Comm'n of Texas (Tex. App. 2008). · cites it 3× “; see also Tex. Util. Code Ann. § 37.051 (West 2007) (requiring utility to obtain permit before directly or indirectly providing service to public).”
Pub. Util. Comm'n of Texas & Elec. Transmission Texas, LLC v. Cities of Harlingen, McAllen, Mission, Port Lavaca, Rockport, & Victoria State of Texas & Texas Indus. Energy Consumers (Tex. App. 2010). · cites it 2× “ETT applied to the Commission for a CCN to provide service as an electric utility in Texas, see Tex. Util. Code Ann. § 37.051 (a) (West 2007), for approval of the transactions to form, capitalize, and structure ETT, see id.”
Pub. Util. Comm'n of Texas & Elec. Transmission Texas, LLC v. Cities of Harlingen, McAllen, Mission, Port Lavaca, Rockport, & Victoria State of Texas & Texas Indus. Energy Consumers (Tex. App. 2010). · cites it 2× “ETT applied to the Commission for a CCN to provide service as an electric utility in Texas, see Tex. Util. Code Ann. § 37.051 (a) (West 2007), for approval of the transactions to form, capitalize, and structure ETT, see id.”
in Re Centerpoint Energy Houston Elec., Llc. (Tex. 2021). “See TEX. UTIL. CODE § 37.051 (requiring an electric utility to obtain from the PUC a certificate of convenience and necessity before extending its service).”
Navo South Dev. Partners, Ltd. v. Denton Cnty. Elec. Coop., Inc., 669 F. Supp. 2d 747 (E.D. Tex. 2009). “See Tex. UtilCode Ann. § 37.051. A certificate holder must serve every consumer in the certificated area and provide continuous and adequate service.”
Lamb Cnty. Elec. Coop., Inc. v. Pub. Util. Comm'n of Texas Bailey Cnty. Elec. Coop. Ass'n Mobil Expl. & Producing U.S., Inc. Sw. Pub. Serv. Co. Texaco Expl. & Prod., Inc. (Tex. App. 2001). “1446c, §§ 50, 53, 60 since repealed and codified at Tex. Util. Code Ann. § 37.051 , .056, .156 (West 1998 & Supp.”
Lamb Cnty. Elec. Coop., Inc. v. Pub. Util. Comm'n of Texas Bailey Cnty. Elec. Coop. Ass'n Mobil Expl. & Producing U.S., Inc. Sw. Pub. Serv. Co. Texaco Expl. & Prod., Inc. (Tex. App. 2001). “1446c, §§ 50, 53 , 60 since repealed and codified at Tex. Util. Code Ann. § 37.051 , .056, .156 (West 1998 & Supp.”
Show all 14 citing cases →
— Tex. Util. Code § 37.051(a) — 2 cases
Pub. Util. Comm'n v. Cities of Harlingen, 311 S.W.3d 610 (Tex. App. 2010). “ETT applied to the Commission for a CCN to provide service as an electric utility in Texas, see Tex. Util.Code Ann. § 37.051(a) (West 2007), for approval of the transactions to form, capitalize, and structure ETT, see id.”
Coastal Habitat All. v. Patterson, 601 F. Supp. 2d 868 (W.D. Tex. 2008). “See Tex. Util.Code Ann. § 37.051(a). Defendants argue the Private Defendants’ wind farms are exempt wholesale generators and have been excluded from the definition of electric utilities and the Certificate requirement since September 1, 1995.”
— Tex. Util. Code § 37.051(b) — 1 case
Lamb Cnty. Elec. Coop., Inc. v. Pub. Util. Comm'n, 269 S.W.3d 260 (Tex. App. 2008). “; see also Tex. Util.Code Ann. § 37.051 (West 2007) (requiring utility to obtain permit before directly or indirectly providing service to public).”
— Tex. Util. Code § 37.051(d) — 1 case
Pub. Util. Comm'n v. Cities of Harlingen, 311 S.W.3d 610 (Tex. App. 2010). “ETT applied to the Commission for a CCN to provide service as an electric utility in Texas, see Tex. Util.Code Ann. § 37.051(a) (West 2007), for approval of the transactions to form, capitalize, and structure ETT, see id.”
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