PRIOR PRINTER'S NOS. 1419, 1912, 1945 PRINTER'S NO. 1973
No. 1030 Session of 2004
INTRODUCED BY ERICKSON, CONTI, WAUGH, ORIE, KUKOVICH, SCHWARTZ,
MUSTO, EARLL, PIPPY, BOSCOLA, RAFFERTY, M. WHITE AND STACK,
MARCH 15, 2004
AS AMENDED ON THIRD CONSIDERATION, NOVEMBER 17, 2004
AN ACT
1 Providing for the sale of electric energy generated from
2 renewable and environmentally beneficial sources, for the
3 acquisition of electric energy generated from renewable and
4 environmentally beneficial sources by electric distribution
5 and supply companies and for the powers and duties of the
6 Pennsylvania Public Utility Commission.
7 The General Assembly of the Commonwealth of Pennsylvania
8 hereby enacts as follows:
9 Section 1. Short title.
10 This act shall be known and may be cited as the Alternative
11 Energy Portfolio Standards Act.
12 Section 2. Definitions.
13 The following words and phrases when used in this act shall
14 have the meanings given to them in this section unless the
15 context clearly indicates otherwise:
16 "Alternative energy credit." A tradable instrument that is
17 used to establish, verify and monitor compliance with this act.
18 A unit of credit shall equal one megawatt hour of electricity
19 from an alternative energy source.
1 "Alternative energy portfolio standards." Standards
2 establishing that a certain amount of energy sold from
3 alternative energy sources is included as part of the sources of
4 electric generation by electric utilities within this
5 Commonwealth.
6 "Alternative energy sources." The term shall include the
7 following EXISTING AND NEW sources for the production of <--
8 electricity:
9 (1) Solar photovoltaic OR OTHER SOLAR ELECTRIC energy. <--
10 (2) Solar thermal energy.
11 (3) Wind power.
12 (4) Large-scale hydropower, WHICH SHALL MEAN THE <--
13 PRODUCTION OF ELECTRIC POWER BY HARNESSING THE HYDROELECTRIC
14 POTENTIAL OF MOVING WATER IMPOUNDMENTS, INCLUDING PUMPED
15 STORAGE THAT DOES NOT MEET THE REQUIREMENTS OF LOW-IMPACT
16 HYDROPOWER UNDER PARAGRAPH (5).
17 (5) Low-impact hydropower, consisting of any technology
18 that produces less than 50 megawatts of electric power and <--
19 that harnesses the hydroelectric potential of moving water
20 impoundments, provided such incremental hydroelectric
21 development:
22 (i) does not adversely change existing impacts to
23 aquatic systems;
24 (ii) meets the certification standards established
25 by the Low Impact Hydropower Institute and American
26 Rivers, Inc., or their successors;
27 (iii) provides an adequate water flow for protection
28 of aquatic life and for safe and effective fish passage;
29 (iv) protects against erosion; and
30 (v) protects cultural and historic resources.
20040S1030B1973 - 2 -
1 (6) Geothermal energy, which shall mean electricity
2 produced by extracting hot water or steam from geothermal
3 reserves in the earth's crust and supplied to steam turbines
4 that drive generators to produce electricity.
5 (7) Biomass energy, which shall mean the generation of
6 electricity utilizing the following:
7 (i) organic material from a plant that is grown for
8 the purpose of being used to produce electricity or is
9 protected by the Federal Conservation Reserve Program
10 (CRP) and provided further that crop production on CRP
11 lands does not prevent achievement of the water quality
12 protection, soil erosion prevention or wildlife
13 enhancement purposes for which the land was primarily set
14 aside; or
15 (ii) any solid nonhazardous, cellulosic waste
16 material that is segregated from other waste materials, <--
17 by-products of the pulping process and wood manufacturing
18 process including bark, wood chips, sawdust and lignin in
19 spent pulping liquors, SUCH AS waste pallets, crates and <--
20 landscape or right-of-way tree trimmings or agricultural
21 sources, including orchard tree crops, vineyards, grain,
22 legumes, sugar and other crop by-products or residues.
23 (8) Biologically derived methane gas, which shall
24 include methane from the anaerobic digestion of organic
25 materials from yard waste, such as grass clippings and
26 leaves, food waste, animal waste and sewage sludge. The term
27 also includes landfill methane gas.
28 (9) Fuel cells, which shall mean any electrochemical
29 device that converts chemical energy in a hydrogen-rich fuel
30 directly into electricity, heat and water without combustion.
20040S1030B1973 - 3 -
1 (10) Waste coal, which shall include the combustion of
2 waste coal in facilities in which the waste coal was disposed
3 or abandoned prior to July 31, 1982, or disposed of
4 thereafter in a permitted coal refuse disposal site
5 regardless of when disposed of, and used to generate
6 electricity; or such other waste coal combustion meeting
7 alternate eligibility requirements established by regulation.
8 Facilities combusting waste coal shall use at a minimum a
9 combined fluidized bed boiler and be outfitted with a
10 limestone injection system and a fabric filter particulate
11 removal system. Alternative energy credits shall be
12 calculated based upon the proportion of waste coal utilized
13 to produce electricity at the facility.
14 (11) Coal mine methane, which shall mean methane gas
15 emitting from abandoned or working coal mines.
16 (12) Demand side management consisting of the management
17 of customer consumption of electricity or the demand for
18 electricity through the implementation of:
19 (i) energy efficiency technologies, management
20 practices or other strategies in residential, COMMERCIAL, <--
21 institutional or government customers that reduce
22 electricity consumption by those customers;
23 (ii) load management or demand response
24 technologies, management practices or other strategies in
25 residential, commercial, industrial, institutional and
26 government customers that shift electric load from
27 periods of higher demand to periods of lower demand, <--
28 including pump storage technologies; or
29 (iii) industrial by-product technologies consisting
30 of the use of a by-product from an industrial process,
20040S1030B1973 - 4 -
1 including the reuse of energy from exhaust gases or other
2 manufacturing by-products that are used in the direct
3 production of electricity at the facility of a customer.
4 (13) Distributed generation system, which shall mean the
5 small-scale power generation of electricity using an <--
6 alternative energy source at a site that does not use the
7 facilities of an electric distribution company or a regional
8 transmission organization to supply an end user. AND USEFUL <--
9 THERMAL ENERGY.
10 "Alternative energy system." A facility or energy system
11 that uses a form of alternative energy source to generate
12 electricity and delivers the electricity it generates to the
13 distribution system of an electric distribution company or to
14 the transmission system operated by a regional transmission
15 organization.
16 "Commission." The Pennsylvania Public Utility Commission.
17 "Cost recovery period." The period during which competitive <--
18 "COST RECOVERY PERIOD." THE LONGER OF: <--
19 (1) THE PERIOD DURING WHICH COMPETITIVE transition
20 charges under 66 Pa.C.S § 2808 (relating to competitive
21 transition charge) or intangible transition charges under 66
22 Pa.C.S. § 2812 (relating to approval of transition bonds) are <--
23 recovered or the period during which an electric BONDS) ARE <--
24 RECOVERED; OR
25 (2) THE PERIOD DURING WHICH AN ELECTRIC distribution
26 company operates under a Pennsylvania Public Utility
27 Commission-approved generation rate plan that has been
28 approved PRIOR TO OR within one year of the effective date of <--
29 this act, but in no case shall the cost recovery period under
30 this act extend beyond December 31, 2010.
20040S1030B1973 - 5 -
1 "Customer-generator." A nonutility owner or operator of a
2 net metered distributed generation system with a nameplate
3 capacity of not greater than 50 kilowatts if installed at a
4 residential service or not larger than 1,000 kilowatts at other
5 customer service locations, except for customers whose systems
6 are above one megawatt and up to two megawatts who make their
7 systems available to operate in parallel with the electric
8 utility during grid emergencies as defined by the regional
9 transmission organization, or where a microgrid is in place for
10 the purpose of maintaining critical infrastructure, such as
11 homeland security assignments, emergency services facilities,
12 hospitals, traffic signals, wastewater treatment plants or
13 telecommunications facilities, provided that technical rules for
14 operating generators interconnected with facilities of an
15 electric distribution company, electric cooperative or municipal
16 electric system have been promulgated by the Institute of
17 Electrical and Electronic Engineers and the Pennsylvania Public
18 Utility Commission.
19 "Department." The Department of Environmental Protection of
20 the Commonwealth.
21 "Electric distribution company." The term shall have the
22 same meaning given to it in 66 Pa.C.S. Ch. 28 (relating to
23 restructuring of electric utility industry).
24 "Electric generation supplier." The term shall have the same
25 meaning given to it in 66 Pa.C.S. Ch. 28 (relating to
26 restructuring of electric utility industry).
27 "Force majeure." An extended period for compliance which may <--
28 be granted by the commission, if the commission determines that
29 additional response time is needed because of extreme deviations
30 in expected renewable generation resulting from events that are
20040S1030B1973 - 6 -
1 impossible to control.
2 "Large-scale hydropower." The production of at least 51
3 megawatts of electric power by harnessing the hydroelectric
4 potential of moving water impoundments.
5 "FORCE MAJEURE." UPON ITS OWN INITIATIVE OR UPON A REQUEST <--
6 OF AN ELECTRIC DISTRIBUTION COMPANY OR AN ELECTRIC GENERATOR
7 SUPPLIER, THE PENNSYLVANIA PUBLIC UTILITY COMMISSION, WITHIN 60
8 DAYS, SHALL DETERMINE IF ALTERNATIVE ENERGY RESOURCES ARE
9 REASONABLY AVAILABLE IN THE MARKETPLACE IN SUFFICIENT QUANTITIES
10 FOR THE ELECTRIC DISTRIBUTION COMPANIES AND ELECTRIC GENERATION
11 SUPPLIERS TO MEET THEIR OBLIGATIONS FOR THAT REPORTING PERIOD
12 UNDER THIS ACT. IF THE COMMISSION DETERMINES THAT ALTERNATIVE
13 ENERGY RESOURCES ARE NOT REASONABLY AVAILABLE IN SUFFICIENT
14 QUANTITIES IN THE MARKETPLACE FOR THE ELECTRIC DISTRIBUTION
15 COMPANIES AND ELECTRIC GENERATION SUPPLIERS TO MEET THEIR
16 OBLIGATIONS UNDER THIS ACT, THEN THE COMMISSION SHALL MODIFY THE
17 UNDERLYING OBLIGATION OF THE ELECTRIC DISTRIBUTION COMPANY OR
18 ELECTRIC GENERATION SUPPLIER OR RECOMMEND TO THE GENERAL
19 ASSEMBLY THAT THE UNDERLYING OBLIGATION BE ELIMINATED.
20 "Municipal solid waste." This will include energy from
21 existing waste to energy facilities which the Department of
22 Environmental Protection has determined are in compliance with
23 current environmental standards, including, but not limited to,
24 all applicable requirements of the Clean Air Act (69 Stat. 322,
25 42 U.S.C. § 7401 et seq.) and associated permit restrictions,
26 and all applicable requirements of the act of July 7, 1980
27 (P.L.380, No.97), known as the Solid Waste Management Act.
28 "Net metering." The means of measuring the difference
29 between the electricity supplied by an electric utility and the
30 electricity generated by a customer-generator, when the
20040S1030B1973 - 7 -
1 renewable energy generating system is intended primarily to
2 offset part or all of the customer-generator's requirements for
3 electricity.
4 "Regional transmission organization." An entity approved by
5 the Federal Energy Regulatory Commission (FERC) that is created
6 to operate and manage the electrical transmission grids of the
7 member electric transmission utilities as required under FERC
8 Order 2000, Docket No. RM99-2-000, FERC Chapter 31.089 (1999) or
9 any successor organization approved by the FERC.
10 "Reporting period." The 12-month period from June 1 through
11 May 31. A reporting year shall be numbered according to the
12 calendar year in which it begins and ends.
13 "Retail electric customer." The term shall have the same
14 meaning given to it in 66 Pa.C.S Ch. 28 (relating to
15 restructuring of electric utility industry).
16 "Tier I alternative energy source." Energy derived from:
17 (1) Solar photovoltaic energy.
18 (2) Wind power.
19 (3) Low-impact hydropower.
20 (4) Geothermal energy.
21 (5) Biologically derived methane gas.
22 (6) Fuel cells.
23 (7) Biomass energy.
24 (8) COAL MINE METHANE. <--
25 "Tier II alternative energy source." Energy derived from:
26 (1) Waste coal.
27 (2) Distributed generation systems.
28 (3) Demand-side management.
29 (4) Coal mine methane. <--
30 (5) Large-scale hydropower.
20040S1030B1973 - 8 -
1 (6) Municipal solid waste.
2 (4) LARGE-SCALE HYDROPOWER. <--
3 (5) MUNICIPAL SOLID WASTE.
4 (6) GENERATION OF ELECTRICITY UTILIZING BY-PRODUCTS OF
5 THE PULPING PROCESS AND WOOD MANUFACTURING PROCESS INCLUDING
6 BARK, WOOD CHIPS, SAWDUST AND LIGNIN IN SPENT PULPING
7 LIQUORS.
8 (7) INTEGRATED COMBINED COAL GASIFICATION TECHNOLOGY.
9 "True-up period." The period each year from the end of the
10 reporting year until September 1.
11 Section 3. Alternative energy portfolio standards.
12 (a) General rule.--From the effective date of this act <--
13 (A) GENERAL COMPLIANCE AND COST RECOVER.-- <--
14 (1) FROM THE EFFECTIVE DATE OF THIS ACT through and
15 including the 15th year after enactment of this act, and each
16 year thereafter, the electric energy sold by an electric
17 distribution company or electric generation supplier to
18 retail electric customers in this Commonwealth shall be
19 comprised of electricity generated from alternative energy
20 sources, and in the percentage amounts as described under
21 subsections (b) and (c). Electric distribution companies and <--
22 SUBSECTIONS (B) AND (C). <--
23 (2) ELECTRIC DISTRIBUTION COMPANIES AND electric
24 generation suppliers shall satisfy both requirements set
25 forth in subsections (b) and (c). Any cost for the purchase <--
26 of resources or credits to comply with this section shall be
27 considered cost of generation supply by the commission,
28 including the cost of generation supply to meet the
29 obligation under 66 Pa.C.S § 2807 (relating to duties of
30 electric distribution companies), by the commission.; <--
20040S1030B1973 - 9 -
1 PROVIDED, HOWEVER, THAT AN ELECTRIC DISTRIBUTION COMPANY OR
2 AN ELECTRIC GENERATION SUPPLIER SHALL BE EXCUSED FROM ITS
3 OBLIGATIONS UNDER THIS SECTION TO THE EXTENT THAT THE
4 COMMISSION DETERMINES THAT FORCE MAJEURE EXISTS.
5 (3) ALL COSTS FOR:
6 (I) THE PURCHASE OF ELECTRICITY GENERATED FROM
7 ALTERNATIVE ENERGY SOURCES, INCLUDING THE COSTS OF THE
8 REGIONAL TRANSMISSION ORGANIZATION, IN EXCESS OF THE
9 REGIONAL TRANSMISSION ORGANIZATION REAL-TIME LOCATIONAL
10 MARGINAL PRICING, OR ITS SUCCESSOR, AT THE DELIVERY POINT
11 OF THE ALTERNATIVE ENERGY SOURCE FOR THE ELECTRICAL
12 PRODUCTION OF THE ALTERNATIVE ENERGY SOURCES; AND
13 (II) PAYMENTS FOR ALTERNATIVE ENERGY CREDITS, IN
14 BOTH CASES THAT ARE VOLUNTARILY ACQUIRED BY AN ELECTRIC
15 DISTRIBUTION COMPANY DURING THE COST RECOVERY PERIOD ON
16 BEHALF OF ITS CUSTOMERS
17 SHALL BE DEFERRED AS A REGULATORY ASSET BY THE ELECTRIC
18 DISTRIBUTION COMPANY AND FULLY RECOVERED, WITH A RETURN ON
19 THE UNAMORTIZED BALANCE, PURSUANT TO AN AUTOMATIC ENERGY
20 ADJUSTMENT CLAUSE UNDER 66 PA.C.S. § 1307 (RELATING TO
21 SLIDING SCALE OF RATES; ADJUSTMENTS) AS A COST OF GENERATION
22 SUPPLY UNDER 66 PA.C.S. § 2807 (RELATING TO DUTIES OF
23 ELECTRIC DISTRIBUTION COMPANIES), IN THE FIRST YEAR AFTER THE
24 EXPIRATION OF ITS COST RECOVERY PERIOD. AFTER THE COST
25 RECOVERY PERIOD, ANY DIRECT OR INDIRECT COSTS FOR THE
26 PURCHASE BY ELECTRIC DISTRIBUTION OF RESOURCES TO COMPLY WITH
27 THIS SECTION, INCLUDING, BUT NOT LIMITED TO, THE PURCHASE OF
28 ELECTRICITY GENERATED FROM ALTERNATIVE ENERGY SOURCES,
29 PAYMENTS FOR ALTERNATIVE ENERGY CREDITS, COST OF CREDITS
30 BANKED, PAYMENTS TO ANY THIRD PARTY ADMINISTRATORS FOR
20040S1030B1973 - 10 -
1 PERFORMANCE UNDER THIS ACT AND COSTS LEVIED BY A REGIONAL
2 TRANSMISSION ORGANIZATION TO ENSURE THAT ALTERNATIVE ENERGY
3 SOURCES ARE RELIABLE, SHALL BE RECOVERED ON A FULL AND
4 CURRENT BASIS PURSUANT TO AN AUTOMATIC ENERGY ADJUSTMENT
5 CLAUSE UNDER 66 PA.C.S. § 1307 AS A COST OF GENERATION SUPPLY
6 UNDER 66 PA.C.S. § 2807.
7 (b) Tier I and solar photovoltaic shares.--
8 (1) Two years after the effective date of this act, at
9 least 1.5% of the electric energy sold by an electric
10 distribution company or electric generation supplier to
11 retail electric customers in this Commonwealth shall be
12 generated from Tier I alternative energy sources. Except as
13 provided in this section, the minimum percentage of electric
14 energy required to be sold to retail electric customers from
15 alternative energy sources shall increase to 2% three years
16 after the effective date of this act. The minimum percentage
17 of electric energy required to be sold to retail electric
18 customers from alternative energy sources shall increase by
19 at least 0.5% each year so that at least 10% 8% of the <--
20 electric energy sold by an electric distribution company or
21 electric generation supplier to retail electric customers in
22 that certificated territory in the 15th year after the
23 effective date of this subsection is sold from Tier I
24 alternative energy resources.
25 (2) Of the electric energy required to be sold from Tier
26 I sources, the TOTAL percentage that must be sold from solar <--
27 photovoltaic technologies is for:
28 (i) Years 1 through 4 - 0.0013%.
29 (ii) Years 5 through 9 - 0.0203%.
30 (iii) Years 10 through 14 - 0.2500%.
20040S1030B1973 - 11 -
1 (iv) Years 15 and thereafter - 0.5000%.
2 (3) Upon commencement of the beginning of the 6th
3 reporting year, the commission shall undertake a review of
4 the compliance by electric distribution companies and
5 electric generation suppliers with the requirements of this
6 act. The review shall also include the status of alternative
7 energy technologies within this Commonwealth and the capacity
8 to add additional alternative energy resources. The
9 commission shall use the results of this review to recommend
10 to the General Assembly additional compliance goals beyond
11 year 15. The commission shall work with the department in
12 evaluating the future alternative energy resource potential.
13 (c) Tier II share.--Of the electrical energy required to be
14 sold from alternative energy sources identified in Tier II, the
15 percentage that must be from these technologies is for:
16 (1) Years 1 through 4 - 2.2%. <--
17 (2) Years 5 through 9 - 3.2%.
18 (3) Years 10 through 14 - 4.2%.
19 (4) Years 15 and thereafter - 5.0%.
20 (1) YEARS 1 THROUGH 4 - 4.2%. <--
21 (2) YEARS 5 THROUGH 9 - 6.2%.
22 (3) YEARS 10 THROUGH 14 - 8.2%.
23 (4) YEARS 15 AND THEREAFTER - 10.0%.
24 (d) Exemption during cost-recovery period.--Compliance with
25 subsections (a), (b) and (c) shall not be required for any
26 electric distribution company that has not reached the end of
27 its cost-recovery period or for electric generation supplier
28 sales in the service territory of an electric distribution
29 company that has not reached the end of its cost-recovery
30 period. At the conclusion of an electric distribution company's
20040S1030B1973 - 12 -
1 cost-recovery period, this exception shall no longer apply, and
2 compliance shall be required at the percentages in effect at
3 that time. Electric distribution companies and electric
4 generation suppliers whose sales are exempted under this
5 subsection and who voluntarily sell electricity generated from
6 Tier I and Tier II sources during the cost-recovery period may
7 bank credits consistent with subsection (e)(7).
8 (e) Alternative energy credits.--
9 (1) The commission shall establish an alternative energy
10 credits program as needed to implement this act. The
11 provision of services pursuant to this section shall be
12 exempt from the competitive procurement procedures of 62
13 Pa.C.S. (relating to procurement).
14 (2) The commission shall approve an independent entity
15 to serve as the alternative energy credits program
16 administrator. The administrator shall have those powers and
17 duties assigned by commission regulations. Such powers and
18 duties shall include, but not be limited to, the following:
19 (i) To create and administer an alternative energy
20 credits certification, tracking and reporting program.
21 This program should include, at a minimum, a process for
22 qualifying alternative energy systems and determining the
23 manner credits can be created, accounted for, transferred
24 and retired.
25 (ii) To submit reports to the commission at such
26 times and in such manner as the commission shall direct.
27 (3) All qualifying alternative energy systems must
28 include a qualifying meter to record the cumulative electric
29 production to verify the advanced energy credit value.
30 Qualifying meters will be approved by the commission as
20040S1030B1973 - 13 -
1 defined in paragraph (4).
2 (4) (i) An electric distribution company or electric
3 generation supplier shall comply with the applicable
4 requirements of this section by purchasing sufficient
5 alternative energy credits and submitting documentation
6 of compliance to the program administrator.
7 (ii) For purposes of this subsection, one
8 alternative energy credit shall represent one megawatt
9 hour of qualified alternative electric generation,
10 whether self-generated, purchased along with the electric
11 commodity or separately through a tradable instrument and
12 otherwise meeting the requirements of commission
13 regulations and the program administrator.
14 (5) The alternative energy credits program shall include
15 provisions requiring a reporting period as defined in section
16 2 for all covered entities under this act. The alternative
17 energy credits program shall also include a true-up period as
18 defined in section 2. The true-up period shall provide
19 entities covered under this act the ability to obtain the
20 required number of alternative energy credits or to make up
21 any shortfall of the alternative energy credits they may be
22 required to obtain to comply with this act. A force majeure
23 provision shall also be provided for under the true-up period
24 provisions.
25 (6) An electric distribution company and electric
26 generation supplier may bank or place in reserve alternative
27 energy credits produced in one reporting year for compliance
28 in either or both of the two subsequent reporting years,
29 subject to the limitations set forth in this subsection and
30 provided that the electric distribution company and electric
20040S1030B1973 - 14 -
1 generation supplier are in compliance for all previous
2 reporting years. In addition, the electric distribution
3 company and electric generation supplier shall demonstrate to
4 the satisfaction of the commission that such credits:
5 (i) were in excess of the alternative energy credits
6 needed for compliance in the year in which they were
7 generated and that such excess credits have not
8 previously been used for compliance under this act;
9 (ii) do not exceed 30% of the credits needed by the <--
10 electric distribution company and electric generation
11 supplier for compliance in the year they were generated;
12 (iii) (II) were produced by the generation of <--
13 electrical energy by alternative energy sources and sold
14 to retail customers during the year in which they were
15 generated; and
16 (iv) (III) have not otherwise been nor will be sold, <--
17 retired, claimed or represented as part of satisfying
18 compliance with alternative or renewable energy portfolio
19 standards in other states.
20 (7) An electric distribution company or an electric
21 generation supplier with sales that are exempted under
22 subsection (d) may bank credits for retail sales of
23 electricity generated from Tier I and Tier II sources made
24 prior to the end of the cost-recovery period and after the
25 effective date of this act. Bankable credits shall be limited
26 to credits associated with electricity sold from Tier I and
27 Tier II sources during a reporting year which exceeds the
28 volume of sales from such sources by an electric distribution
29 company or electric generation supplier during the 12-month
30 period immediately preceding the effective date of this act.
20040S1030B1973 - 15 -
1 All credits banked under this subsection shall be available
2 for compliance with subsections (b) and (c) for no more than
3 two reporting years following the conclusion of the cost-
4 recovery period.
5 (8) The commission or its designee shall develop a
6 registry of pertinent information regarding all available
7 alternative energy credits, credit transactions among
8 electric distribution companies and electric generation
9 suppliers, the number of alternative energy credits sold or
10 transferred and the price paid for the sale or transfer of
11 the credits. The registry shall provide current information
12 to electric distribution companies, electric generation
13 suppliers and the general public on the status of alternative
14 energy credits created, sold or transferred within this
15 Commonwealth.
16 (9) The commission may impose an administrative fee on
17 an alternative energy credit transaction. The amount of this
18 fee may not exceed the actual direct cost of processing the
19 transaction by the alternative energy credits administrator.
20 The commission is authorized to utilize up to 5% of the
21 alternative compliance fees generated under subsection (f)
22 for administrative expenses directly associated with this
23 act.
24 (10) The commission shall establish regulations
25 governing the verification and tracking of energy efficiency
26 and demand-side management measures pursuant to this act,
27 which shall include benefits to all utility customer classes.
28 When developing regulations, the commission must give
29 reasonable consideration to existing and proposed regulations
30 and rules in existence in the regional transmission
20040S1030B1973 - 16 -
1 organizations that manage the transmission system in any part
2 of this Commonwealth. All verified reductions shall accrue
3 credits starting with the passage of this act.
4 (11) The commission shall within 120 days of the
5 effective date of this act develop a depreciation schedule
6 for alternative energy credits created through demand side
7 management, energy efficiency and load management
8 technologies and shall develop standards for tracking and
9 verifying savings from energy efficiency, load management and
10 demand-side management measures. The commission shall allow
11 for a 60-day public comment period and shall issue final
12 standards within 30 days of the close of the public comment
13 period.
14 (f) Alternative compliance payment.--
15 (1) At the end of each program year, the program
16 administrator shall provide a report to the commission and to
17 each covered electric distribution company showing their
18 status level of alternative energy acquisition.
19 (2) The commission shall conduct a review of each
20 determination made under subsections (b) and (c). If, after
21 notice and hearing, the commission determines that an
22 electric distribution company or electric generation supplier
23 has failed to comply with subsections (b) and (c), the
24 commission shall impose an alternative compliance payment on
25 that company or supplier.
26 (3) The alternative compliance payment, with the
27 exception of the solar photovoltaic share compliance
28 requirement set forth in subsection (b)(2), shall be $45
29 times the number of additional alternative energy credits
30 needed in order to comply with subsection (b) or (c).
20040S1030B1973 - 17 -
1 (4) The alternative compliance payment for the solar
2 photovoltaic share shall be 200% of the average market share <--
3 of the solar photovoltaic credits sold during the reporting
4 period. VALUE OF SOLAR RENEWABLE ENERGY CREDITS SOLD DURING <--
5 THE REPORTING PERIOD WITHIN THE SERVICE REGION OF THE
6 REGIONAL TRANSMISSION ORGANIZATION.
7 (5) The commission shall establish a process to provide
8 for, at least annually, a review of the alternative energy
9 market within this Commonwealth and the service territories
10 of the regional transmission organizations that manage the
11 transmission system in any part of this Commonwealth. The
12 commission will use the results of this study to identify any
13 needed changes to the cost associated with the alternative
14 compliance payment program. The commission may raise the cost <--
15 of the alternative compliance payments to maintain the
16 integrity of the payments program and to ensure that it is
17 not used to meet compliance with this act in lieu of
18 acquiring energy from actual alternative energy sources as
19 defined in this act. If the commission finds that the costs
20 associated with alternative compliance payment program must
21 be lowered CHANGED, the commission shall present these <--
22 findings to the General assembly for legislative enactment.
23 (g) Transfer to sustainable development funds.--
24 (1) Notwithstanding the provisions of 66 Pa.C.S. §§ 511
25 (relating to disposition, appropriation and disbursement of
26 assessments and fees) and 3315 (relating to disposition of
27 fines and penalties), alternative compliance payments imposed
28 pursuant to this act shall be paid into the sustainable <--
29 development funds, created under the commissions
30 restructuring orders under 66 Pa.C.S. Ch. 28 (relating to
20040S1030B1973 - 18 -
1 restructuring of electric utility industry). Alternative
2 compliance payments will be paid into the appropriate fund
3 based upon which electric distribution company or electric
4 generation supplier incurred the alternative compliance
5 payment. PENNSYLVANIA'S SUSTAINABLE ENERGY FUNDS, CREATED <--
6 UNDER THE COMMISSION'S RESTRUCTURING ORDERS UNDER 66 PA.C.S.
7 CH. 28 (RELATING TO RESTRUCTURING OF ELECTRIC UTILITY
8 INDUSTRY). ALTERNATIVE COMPLIANCE PAYMENTS SHALL BE PAID INTO
9 A SPECIAL FUND OF THE PENNSYLVANIA SUSTAINABLE ENERGY BOARD,
10 ESTABLISHED BY THE COMMISSION UNDER DOCKET M-00031715, AND
11 MADE AVAILABLE TO THE REGIONAL SUSTAINABLE ENERGY FUNDS UNDER
12 PROCEDURES AND GUIDELINES APPROVED BY THE PENNSYLVANIA ENERGY
13 BOARD.
14 (2) The alternative compliance payments shall be
15 utilized solely for projects that will increase the amount of
16 electric energy generated from alternative energy resources
17 for purposes of compliance with subsections (b) and (c).
18 (H) NONSEVERABILITY.--THE PROVISIONS OF SUBSECTION (A) ARE <--
19 DECLARED TO BE NONSEVERABLE. IF ANY PROVISION OF SUBSECTION (A)
20 IS HELD INVALID, THE REMAINING PROVISIONS OF THIS ACT SHALL BE
21 VOID.
22 Section 4. Portfolio requirements in other states.
23 If an electric distribution supplier or electric generation
24 company provider sells electricity in any other state and is
25 subject to renewable energy portfolio requirements in that
26 state, they shall list any such requirement and shall indicate
27 how it satisfied those renewable energy portfolio requirements.
28 To prevent double-counting, the electric distribution supplier
29 or electric generation company shall not satisfy Pennsylvania's
30 alternative energy portfolio requirements using alternative
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1 energy used to satisfy another state's portfolio requirements.
2 Energy derived only from alternative energy sources inside the
3 geographical boundaries of this Commonwealth or within the
4 service territory of any regional transmission organization that
5 manages the transmission system in any part of this Commonwealth
6 shall be eligible to meet the compliance requirements under this
7 act. Electric distribution companies and electric generation
8 suppliers shall document that this energy was not used to
9 satisfy another state's renewable energy portfolio standards.
10 Section 5. Interconnection standards for customer-generator
11 facilities.
12 The commission shall develop technical and net metering
13 interconnection rules for customer-generators intending to
14 operate renewable onsite generators in parallel with the
15 electric utility grid, consistent with rules defined in other
16 states within the service region of the regional transmission
17 organization that manages the transmission system in any part of
18 this Commonwealth. The commission shall convene a stakeholder
19 process to develop Statewide technical and net metering rules
20 for customer-generators. The commission shall develop these
21 rules within nine months of the effective date of this act.
22 Section 6. Health and safety standards.
23 The department shall cooperate with the Department of Labor
24 and Industry as necessary in developing health and safety
25 standards, as needed, regarding facilities generating energy
26 from alternative energy sources. The department shall establish
27 appropriate and reasonable health and safety standards to ensure
28 uniform and proper compliance with this act by owners and
29 operators of facilities generating energy from alternative
30 energy sources as defined in this act.
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1 Section 7. Interagency responsibilities.
2 (a) Commission responsibilities.--The commission will carry
3 out the responsibilities delineated within this act. The
4 commission also shall, in cooperation with the department,
5 conduct an ongoing alternative energy resources planning
6 assessment for this Commonwealth. This assessment will, at a
7 minimum, identify current and operating alternative energy
8 facilities, the potential to add future alternative energy
9 generating capacity, and the conditions of the alternative
10 energy marketplace. The assessment will identify needed methods
11 to maintain or increase the relative competitiveness of the
12 alternative energy market within this Commonwealth.
13 (b) Department responsibilities.--The department shall
14 ensure that all qualified alternative energy sources meet all
15 applicable environmental standards and shall verify that an
16 alternative energy source meets the standards set forth in
17 section 2.
18 (c) Cooperation between commission and department.--The
19 commission and the department shall work cooperatively to
20 monitor the performance of all aspects of this act and will
21 provide an annual report to the chairman and minority chairman
22 of the Environmental Resources and Energy Committee of the
23 Senate and the chairman and minority chairman of the
24 Environmental Resources and Energy Committee of the House of
25 Representatives. The report shall include at a minimum:
26 (1) The status of the compliance with the provisions of
27 this act by electric distribution companies and electric
28 generations suppliers.
29 (2) Current costs of alternative energy on a per
30 kilowatt hour basis for all alternative energy technology
20040S1030B1973 - 21 -
1 types.
2 (3) Costs associated with the alternative energy credits
3 program under this act, including the number of alternative
4 compliance payments.
5 (4) The status of the alternative energy marketplace
6 within this Commonwealth.
7 (5) Recommendations for program improvements.
8 Section 8. Rural electric cooperatives.
9 Each rural electric cooperative operating within this
10 Commonwealth shall offer to its retail customers a voluntary
11 program of energy efficiency and demand-side management
12 programs, as a means to satisfy compliance with the requirements
13 of this act.
14 Section 9. Effective date.
15 This act shall take effect in 90 days.
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