Relating to affiliation with certain foreign entities of certain persons working or participating in the electricity market; increasing an administrative penalty.

HB 4378 requires electricity market participants in Texas to report purchases of critical grid equipment from certain foreign entities and attest that such purchases won’t grant those entities control over grid infrastructure. It mandates businesses to confirm compliance with security rules (referencing Chapter 117 of the Business & Commerce Code) when registering with the grid operator (ERCOT) and prohibits foreign access except for warranty support. The bill increases penalties for false or incomplete reporting to up to $1 million per violation. This primarily affects companies operating in Texas’ electricity market that use equipment from designated foreign vendors.