PRIOR PRINTER'S NOS. 1000, 2177, 2350

PRINTER'S NO.  2388

  

THE GENERAL ASSEMBLY OF PENNSYLVANIA

  

HOUSE BILL

 

No.

80

Session of

2009

  

  

INTRODUCED BY VITALI, ROSS, GEORGE, DePASQUALE, HARPER, FREEMAN, M. O'BRIEN, GOODMAN, CREIGHTON, MOUL, O'NEILL, MANDERINO, BELFANTI, MELIO, SANTONI, HARHART, READSHAW, GIBBONS, ADOLPH, HORNAMAN, CARROLL, MYERS, JOSEPHS, LENTZ, DeWEESE, CONKLIN, PETRI, GINGRICH, CURRY, DRUCKER, MICOZZIE, GERBER, SABATINA, MAHONEY, BARBIN, SEIP, WALKO AND CALTAGIRONE, MARCH 12, 2009

  

  

AS AMENDED ON HOUSE FLOOR, PRIOR TO SECOND CONSIDERATION, JULY 2, 2009   

  

  

  

AN ACT

  

1

Amending the act of November 30, 2004 (P.L.1672, No.213),

2

entitled, "An act providing for the sale of electric energy

3

generated from renewable and environmentally beneficial

4

sources, for the acquisition of electric energy generated

5

from renewable and environmentally beneficial sources by

6

electric distribution and supply companies and for the powers

7

and duties of the Pennsylvania Public Utility Commission,"

8

further providing for definitions and for alternative energy

9

portfolio standards; and providing for sequestration facility

10

permitting and for title to carbon dioxide, immunity and

11

transfer of liability; establishing the Carbon Dioxide

12

Indemnification Fund; providing for carbon dioxide

13

sequestration facility and transportation pipeline on

14

Commonwealth State forest lands; and providing for

15

application of the Public Utility Code to transporters of

16

carbon dioxide.

17

The General Assembly of the Commonwealth of Pennsylvania

18

hereby enacts as follows:

19

Section 1.  The definition of "alternative energy sources"

20

and "Tier II alternative energy source" in section 2 of the act

21

of November 30, 2004 (P.L.1672, No.213), known as the

22

Alternative Energy Portfolio Standards Act, are amended by

 


1

adding paragraphs and the section is amended by adding

2

definitions to read:

3

Section 2.  Definitions.

4

The following words and phrases when used in this act shall

5

have the meanings given to them in this section unless the

6

context clearly indicates otherwise:

7

* * *

8

"Alternative energy sources."  The term shall include the

9

following existing and new sources for the production of

10

electricity:

11

* * *

12

(14)  Advanced coal combustion with limited carbon

13

emissions, which means the production of electric power from

14

a generation facility that is fueled by coal, waste coal or

15

gas derived from an advanced coal gasification plant or a

16

plant that is retrofitted to capture carbon that:

17

(i)  Begins commercial operation after January 1,

18

2009, and captures, either in the advanced coal

19

gasification plant or in the electrical generation

20

facility, and delivers to a carbon dioxide sequestration

21

facility in this Commonwealth for permanent sequestration 

22

at least the following amount of all carbon dioxide

23

produced:

24

(A)  40% from June 1, 2015, to May 31, 2019.

25

(B)  60% from June 1, 2019, to May 31, 2024.

26

(C)  90% from June 1, 2024, and thereafter.

27

(D)  The requirement under clause (C) shall be

28

waived if commercially proven and project-financeable

29

technology is not available as determined by the

30

department.

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1

(ii)  Has been designed to accommodate the required

2

additional processing equipment to produce power with a

3

maximum of 1,000 pounds of carbon dioxide emissions per

4

megawatt hour or begins commercial operation before

5

January 1, 2009, and captures and delivers to a carbon

6

dioxide sequestration facility in this Commonwealth for

7

permanent sequestration no less than the following amount

8

of carbon dioxide produced:

9

(A)  40% from June 1, 2015, to May 31, 2019.

10

(B)  60% from June 1, 2019, to May 31, 2024.

11

(C)  90% from June 1, 2024, and thereafter. The

12

requirement under this clause shall be waived if

13

commercially proven and project-financeable

14

technology is not available, as determined by the

15

department.

16

(15)  Additional Incremental nuclear energy, which means

<--

17

additional energy generated by an existing nuclear unit as a

18

result of an extended power uprate that has been completed

19

after the effective date of this paragraph and increases a

20

plant's nameplate capacity by more than 7% or by 100

21

megawatts and has a capital cost of more than $150,000,000

22

and has been permitted by the United States Nuclear

23

Regulatory Commission.

24

* * *

25

"Carbon dioxide."  Anthropogenically generated carbon dioxide

26

of sufficient purity and quality as to not compromise the

27

ability of the carbon dioxide transportation pipeline or

28

sequestration facility to safely and effectively transport and

29

sequester the carbon dioxide.

30

"Carbon dioxide sequestration facility."  Geological

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1

subsurface formations within this Commonwealth with suitable cap

2

rock, sealing faults and anticline for the permanent storage of

3

carbon dioxide from advanced coal combustion with limited carbon

4

emissions facilities or other sources within this Commonwealth

5

along with the facilities necessary to transport the carbon

6

dioxide from the surface to the subsurface formations and

7

monitor the permanent storage of the carbon dioxide in

8

subsurface formations. The term shall not include use of the

9

carbon dioxide for enhanced resource recovery or the carbon

10

dioxide transportation pipelines used to transport the carbon

11

dioxide to the sequestration facility.

12

"Carbon dioxide transportation pipeline."  A pipeline within

13

this Commonwealth used to transport carbon dioxide from a

14

facility within this Commonwealth to a carbon dioxide

15

sequestration facility.

16

* * *

17

"DCNR."  The Department of Conservation and Natural Resources

18

of the Commonwealth.

19

* * *

20

"Enhanced resource recovery."  The use of carbon dioxide

21

injection or other techniques for increasing the amount of oil,

22

natural gas or coal bed methane extracted from geologic

23

formations.

24

* * *

25

"Person."  An individual, corporation, partnership,

26

association or other entity recognized by law as the subject of

27

rights, duties or obligations. The term includes the United

28

States, a Federal agency, the Commonwealth, an agency or

29

instrumentality of the Commonwealth and a political subdivision.

30

* * *

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1

"Solar thermal energy."  Technology utilizing solar energy

2

for water heating or for generating electricity.

3

* * *

4

"Tier II alternative energy source."  Energy derived from:

5

* * *

6

(8)  Advanced coal combustion with limited carbon

7

emissions.

8

"Tier III alternative energy source."  Energy derived from:

9

(1)  Solar photovoltaic and solar thermal energy.

10

(2)  Wind power.

11

(3)  Low-impact hydropower.

12

(4)  Geothermal energy.

13

(5)  Biologically derived methane gas.

14

(6)  Fuel cells.

15

(7)  Biomass energy.

16

(8)  Coal mine methane.

17

(9)  Advanced coal combustion with limited carbon

18

emissions.

19

(10)  Incremental nuclear energy, as defined in paragraph

<--

20

(15) of the definition of "alternative energy sources."

21

* * *

22

Section 2.  Section 3(a), (b), (c), (e)(6) and (7) (e)(6),

<--

23

(7) and (12), (f) and (g) of the act, amended July 17, 2007

24

(P.L.114, No.35), are amended and the section is amended by

25

adding subsections to read:

26

Section 3.  Alternative energy portfolio standards.

27

(a)  General compliance and cost recovery.--

28

(1)  From the effective date of this act through and

29

including the 15th year after enactment of this act and each

30

year thereafter, the electric energy sold by an electric

- 5 -

 


1

distribution company or electric generation supplier to

2

retail electric customers in this Commonwealth shall be

3

comprised of electricity generated from alternative energy

4

sources and in the percentage amounts as described under

5

subsections [(b) and (c)] (b), (c), (c.1) and (i).

6

(2)  Electric distribution companies and electric

7

generation suppliers shall satisfy both requirements set

8

forth in subsections [(b) and (c)] (b), (c), (c.1) and (i),

9

provided, however, that an electric distribution company or

10

an electric generation supplier shall be excused from its

11

obligations under this section to the extent that the

12

commission determines that force majeure exists.

13

(3)  All costs for:

14

(i)  the purchase of electricity generated from

15

alternative energy sources, including the costs of the

16

regional transmission organization, in excess of the

17

regional transmission organization real-time locational

18

marginal pricing, or its successor, at the delivery point

19

of the alternative energy source for the electrical

20

production of the alternative energy sources; and

21

(ii)  payments for alternative energy credits,in both

22

cases that are voluntarily acquired by an electric

23

distribution company during the cost recovery period on

24

behalf of its customers shall be deferred as a regulatory

25

asset by the electric distribution company and fully

26

recovered, with a return on the unamortized balance,

27

pursuant to an automatic energy adjustment clause under

28

66 Pa.C.S. § 1307 (relating to sliding scale of rates;

29

adjustments) as a cost of generation supply under 66

30

Pa.C.S. § 2807 (relating to duties of electric

- 6 -

 


1

distribution companies) in the first year after the

2

expiration of its cost-recovery period. After the cost-

3

recovery period, any direct or indirect costs for the

4

purchase by electric distribution of resources to comply

5

with this section, including, but not limited to, the

6

purchase of electricity generated from alternative energy

7

sources, payments for alternative energy credits, cost of

8

credits banked, payments to any third party

9

administrators for performance under this act and costs

10

levied by a regional transmission organization to ensure

11

that alternative energy sources are reliable, shall be

12

recovered on a full and current basis pursuant to an

13

automatic energy adjustment clause under 66 Pa.C.S. §

14

1307 as a cost of generation supply under 66 Pa.C.S. §

15

2807.

16

(b)  Tier I and solar [photovoltaic] shares.--

17

(1)  [Two years after the effective date of this act, at

18

least 1.5% of the electric energy sold by an electric

19

distribution company or electric generation supplier to

20

retail electric customers in this Commonwealth shall be

21

generated from Tier I alternative energy sources. Except as

22

provided in this section, the minimum percentage of electric

23

energy required to be sold to retail electric customers from

24

alternative energy sources shall increase to 2% three years

25

after the effective date of this act. The minimum percentage

26

of electric energy required to be sold to retail electric

27

customers from alternative energy sources shall increase by

28

at least 0.5% each year so that at least 8% of the electric

29

energy sold by an electric distribution company or electric

30

generation supplier to retail electric customers in that

- 7 -

 


1

certificated territory in the 15th year after the effective

2

date of this subsection is sold from Tier I alternative

3

energy resources.] The minimum percentage of electric energy

4

required to be sold to retail electric customers from Tier I

5

alternative energy sources is:

6

(i)  1.5013% for June 1, 2006, through May 31, 2007.

7

(ii)  1.503% for June 1, 2007, through May 31, 2008.

8

(iii)  2.0063% for June 1, 2008, through May 31,

9

2009.

10

(iv)  2.512% for June 1, 2009, through May 31, 2010. 

11

(v)  3.0203% for June 1, 2010, through May 31, 2011.

12

(vi)  3.5504% for June 1, 2011, through May 31, 2012.

13

(vii)  4.0752% for June 1, 2012, through May 31,

14

2013.

15

(viii)  4.6218% for June 1, 2013, through May 31,

16

2014.

17

(ix)  5.7016% for June 1, 2014, through May 31, 2015.

18

(x)  6.80% for June 1, 2015, through May 31, 2016.

19

(xi)  7.91% for June 1, 2016, through May 31, 2017.

20

(xii)  9.00% for June 1, 2017, through May 31, 2018.

21

(xiii)  10.12% for June 1, 2018, through May 31,

22

2019. 

23

(xiv)  11.25% for June 1, 2019, through May 31, 2020.

24

(xv)  12.47% for June 1, 2020, through May 31, 2021.

25

(xvi)  13.85% for June 1, 2021, through May 31, 2022.

26

(xvii)  15.40% for June 1, 2022, through May 31,

27

2023.

28

(xviii)  16.95% for June 1, 2023, through May 31,

29

2024.

30

(xix)  18.00% for June 1, 2024, and thereafter.

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1

(1.1)  The commission shall comply with the requirements

2

of 66 Pa.C.S. § 2814 (relating to additional alternative

3

energy sources) by annually increasing the percentage share

4

of Tier I alternative energy sources required to be sold by

5

an electric distribution company or electric generation

6

supplier under paragraph (1) to reflect any new alternative

7

energy source provided for by 66 Pa.C.S. § 2814. Any annual

8

increase will be applied to the next compliance year

9

requirement.

10

(2)  The total percentage of the electric energy sold by

11

an electric distribution company or electric generation

12

supplier to retail electric customers in this Commonwealth

13

that must be sold from solar photovoltaic and solar thermal

14

energy technologies is:

15

(i)  0.0013% for June 1, 2006, through May 31, 2007.

16

(ii)  0.0030% for June 1, 2007, through May 31, 2008.

17

(iii)  0.0063% for June 1, 2008, through May 31,

18

2009.

19

(iv)  0.0120% for June 1, 2009, through May 31, 2010.

20

(v)  0.0203% for June 1, 2010, through May 31, 2011.

21

[(vi)  0.0325% for June 1, 2011, through May 31,

22

2012.

23

(vii)  0.0510% for June 1, 2012, through May 31,

24

2013.

25

(viii)  0.0840% for June 1, 2013, through May 31,

26

2014.

27

(ix)  0.1440% for June 1, 2014, through May 31, 2015.

28

(x)  0.2500% for June 1, 2015, through May 31, 2016.

29

(xi)  0.2933% for June 1, 2016, through May 31, 2017.

30

(xii)  0.3400% for June 1, 2017, through May 31,

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1

2018.

2

(xiii)  0.3900% for June 1, 2018, through May 31,

3

2019.

4

(xiv)  0.4433% for June 1, 2019, through May 31,

5

2020.

6

(xv)  0.5000% for June 1, 2020, and thereafter.]

7

(vi)  0.0504% for June 1, 2011, through May 31, 2012.

8

(vii)  0.0752% for June 1, 2012, through May 31,

9

2013.

10

(viii)  0.1218% for June 1, 2013, through May 31,

11

2014.

12

(ix)  0.2016% for June 1, 2014, through May 31, 2015.

13

(x)  0.3% for June 1, 2015, through May 31, 2016.

14

(xi)  0.41% for June 1, 2016, through May 31, 2017.

15

(xii)  0.5% for June 1, 2017, through May 31, 2018.

16

(xiii)  0.62% for June 1, 2018, through May 31, 2019.

17

(xiv)  0.75% for June 1, 2019, through May 31, 2020.

18

(xv)  0.97% for June 1, 2020, through May 31, 2021.

19

(xvi)  1.35% for June 1, 2021, through May 31, 2022.

20

(xvii)  1.9% for June 1, 2022, through May 31, 2023.

21

(xviii)  2.45% for June 1, 2023, through May 31,

22

2024.

23

(xix)  3% for June 1, 2024, and thereafter.

24

(3)  Upon commencement of the beginning of the 6th

25

reporting year, and every five years thereafter, the

26

commission shall undertake a review of the compliance by

27

electric distribution companies and electric generation

28

suppliers with the requirements of this act. The review shall

29

also include the status of alternative energy technologies

30

within this Commonwealth and the capacity to add additional

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1

alternative energy resources. The commission shall use the

2

results of this review to recommend to the General Assembly

3

additional compliance goals beyond year [15] 21. The

4

commission shall work with the department in evaluating the

5

future alternative energy resource potential.

6

(4)  Electric energy from solar photovoltaic and solar

7

thermal energy technologies supplied to retail customers

8

shall be generated from solar photovoltaic and solar thermal

9

energy systems located within this Commonwealth in meeting

10

the requirements of paragraph (2).

11

(5)  Notwithstanding the other provisions of this act,

12

credits generated from solar photovoltaic and solar thermal

13

energy technologies outside this Commonwealth may be used to

14

demonstrate compliance under this act provided the credit was

15

acquired prior to the effective date of this subsection.

16

(c)  Tier II share.--Of the electrical energy required to be

17

sold from alternative energy sources identified in Tier II, the

18

percentage that must be from these technologies is for:

19

(1)  Years 1 through 4 - 4.2%.

20

(2)  Years 5 through 9 - 6.2%.

21

(3)  Years 10 through 14 - [8.2%] 11.2%.

22

(4)  Years 15 and thereafter - [10.0%] 13.0%.

23

(c.1)  Retail sales from advanced coal combustion.--The total

24

electric energy sold by an electric distribution company or

25

electric generation supplier to retail electric customers in

26

this Commonwealth that shall be sold from advanced coal

27

combustion with limited carbon emissions is all of the electric

28

energy available from advanced coal combustion with limited

29

carbon emissions up to a maximum of 3.0% of the total electric

30

energy sold by an electric distribution company or electric

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1

generation supplier to retail electric customers in this

2

Commonwealth for the reporting period which begins June 1, 2015,

3

and for each reporting period thereafter pursuant to subsection

4

(c). If at any time on or after June 1, 2015, a carbon dioxide

5

sequestration facility permitted to permanently sequester carbon

6

dioxide in this Commonwealth, is not operating and capable of

7

receiving carbon dioxide for sequestration through no fault of

8

an advanced coal combustion with limited carbon emissions

9

facility, a facility need not sequester carbon dioxide in order

10

to generate alternative energy credits provided:

11

(1)  The facility is capable of capturing to the

12

department's satisfaction the amount of carbon dioxide

13

required by paragraph (14) of the definition of "alternative

14

energy sources" in section 2.

15

(2)  The total value of the alternative energy credits

16

sold by the advanced coal combustion with limited carbon

17

emissions facility during times when the carbon dioxide

18

emissions from the facility are not sequestered shall not

19

exceed the costs that the facility incurred in installing

20

carbon capture equipment, equipment necessary to process coal

21

for carbon capture purposes, equipment necessary to transport

22

the carbon dioxide to the carbon dioxide sequestration

23

facility and costs incurred in connection with the operation

24

of the facility that are due to the capture and

25

transportation of carbon dioxide, as determined by the

26

department. Costs incurred by an advanced coal combustion

27

with limited carbon emissions facility shall not include

28

Federal or State financial assistance received by the

29

facility.

30

(c.2)  Force majeure.--On or after December 31, 2015, if the

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1

commission determines that construction of an advanced coal

<--

2

combustion with limited carbon emissions facility has not been

<--

3

commenced is not operating and capable of capturing the amount

<--

4

of carbon dioxide required by paragraph (14) of the definition

5

of "alternative energy sources" in section 2 during a reporting

6

period, this determination shall constitute force majeure, and

7

electric distribution companies and electric generation

8

suppliers shall be excused from all or part of their obligation

9

under subsection (c.1) during that reporting period, provided

10

the requirements in the definition of "force majeure" in section

11

2 have been met, as determined by the commission. Should force

<--

12

majeure be declared pursuant to this subsection, then subsection

13

(c.1)(2), limiting the total value of credit sold in the event

14

that carbon dioxide is not being sequestered, shall remain in

15

full force and effect to the extent that any such credits remain

16

available under this act.

17

(c.3)  Long-term contracts.--Upon review and approval of the

18

commission, an electric distribution company may enter into a

19

long-term contract of up to 25 years to purchase the energy,

20

capacity or alternative energy credits of an advanced coal

21

combustion with limited carbon emissions facility. The contract

22

shall provide for the recovery of costs associated with carbon

23

capture, including, but not limited to, any fees charged by the

24

owner or operator of the carbon dioxide sequestration facility

25

or a carbon dioxide transportation pipeline. The commission

26

shall determine whether the contract is reasonable, taking into

27

consideration the following:

28

(1)  The price of the energy purchased under the long-

29

term contract. The contract shall provide that if the carbon

30

dioxide sequestration facility is not operating and capable

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1

of receiving carbon dioxide for sequestration for a period of

2

no less than 90 days, the price of energy under the contract

3

shall be reduced to account for the advanced coal combustion

4

with limited carbon emissions facility's reduced operating

5

costs.

6

(2)  The price of capacity purchased under the long-term

7

contract.

8

(3)  The price of alternative energy credits, provided

9

that the cost of an alternative energy credit purchased from

10

advanced coal combustion with limited carbon emissions shall

11

not exceed $45 per megawatt hour (MWh).

12

(4)  Prior to the effective date of the contract, the

13

value of any carbon emission credits or other credits that

14

the seller obtains from the advanced coal combustion with

15

limited carbon emissions facility.

16

(5)  After the effective date of the contract, the value

17

of any additional Federal or State carbon credits, allowances

18

or other financial benefits shall be reflected in the price

19

of the resource in a manner which recognizes savings to

20

customers and does not reduce the economic return to the

21

seller, provided that the seller demonstrates that it has

22

made a commercially reasonable effort to distribute any

23

economic incentives it has realized to electric distribution

24

companies. A contract approved by the commission under this

25

subsection shall be deemed to meet the requirements of 66

26

Pa.C.S. § 2807(e) (relating to duties of electric

27

distribution companies).

28

* * *

29

(e)  Alternative energy credits.--

30

* * *

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1

(6)  An electric distribution company and electric

2

generation supplier may bank or place in reserve alternative

3

energy credits produced in one reporting year for compliance

4

in [either or both] any or all of the [two] four subsequent

<--

5

reporting years, subject to the limitations set forth in this

6

subsection and provided that the electric distribution

7

company and electric generation supplier are in compliance

8

for all previous reporting years. In addition, the electric

9

distribution company and electric generation supplier shall

10

demonstrate to the satisfaction of the commission that such

11

credits:

12

(i)  were in excess of the alternative energy credits

13

needed for compliance in the year in which they were

14

generated and that such excess credits have not

15

previously been used for compliance under this act;

16

(ii)  were produced by the generation of electrical

17

energy by alternative energy sources and sold to retail

18

customers during the year in which they were generated;

19

and

20

(iii)  have not otherwise been nor will be sold,

21

retired, claimed or represented as part of satisfying

22

compliance with alternative or renewable energy portfolio

23

standards in other states.

24

(7)  An electric distribution company or an electric

25

generation supplier with sales that are exempted under

26

subsection (d) may bank credits for retail sales of

27

electricity generated from Tier I and Tier II sources made

28

prior to the end of the cost-recovery period and after the

29

effective date of this act. Bankable credits shall be limited

30

to credits associated with electricity sold from Tier I and

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1

Tier II sources during a reporting year which exceeds the

2

volume of sales from such sources by an electric distribution

3

company or electric generation supplier during the 12-month

4

period immediately preceding the effective date of this act.

5

All credits banked under this subsection shall be available

6

for compliance with subsections (b) and (c) for no more than

7

[two] four reporting years following the conclusion of the

8

cost-recovery period.

9

* * *

10

(12)  (i)  Unless a contractual provision explicitly

<--

11

assigns alternative energy credits in a different manner,

12

the owner of the alternative energy system or a customer-

13

generator owns any and all alternative energy credits

14

associated with or created by the production of electric

15

energy by such facility or customer, and the owner or

16

customer shall be entitled to sell, transfer or take any

17

other action to which a legal owner of property is

18

entitled to take with respect to the credits.

19

(ii)  This paragraph shall apply to all alternative

20

energy credits created pursuant to this act.

21

(f)  Alternative compliance payment.--

22

(1)  At the end of each program year, the program

23

administrator shall provide a report to the commission and to

24

each covered electric distribution company showing their

25

status level of alternative energy acquisition.

26

(2)  The commission shall conduct a review of each

27

determination made under subsections [(b) and (c)] (b), (c),

28

(c.1) and (i). If, after notice and hearing, the commission

29

determines that an electric distribution company or electric

30

generation supplier has failed to comply with subsections

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1

[(b) and (c)] (b), (c), (c.1) and (i), the commission shall

2

impose an alternative compliance payment on that company or

3

supplier.

4

(3)  The alternative compliance payment, with the

5

exception of the solar [photovoltaic] share compliance

6

requirement set forth in subsection (b)(2), shall be $45

7

times the number of additional alternative energy credits

8

needed in order to comply with subsection (b) or (c).

9

(4)  [The alternative compliance payment for the solar

10

photovoltaic share shall be 200% of the average market value

11

of solar renewable energy credits sold during the reporting

12

period within the service region of the regional transmission

13

organization, including, where applicable, the levelized up-

14

front rebates received by sellers of solar renewable energy

15

credits in other jurisdictions in the PJM Interconnection,

16

L.L.C. transmission organization (PJM) or its successor.] The

17

alternative compliance payment for the solar alternative

18

share shall be established by the commission in an amount and

19

for a period of years necessary to promote the market for

20

solar alternative energy credits. The alternative compliance

21

payment for the solar share may vary over the time period

22

established by the commission but shall be at least 200% of

23

the average market value for solar alternative energy credits

24

sold within the service region of the PJM Interconnection,

25

L.L.C. transmission organization in the year prior to the

26

establishment of the alternative compliance payment schedule.

27

The commission shall review the solar alternative compliance

28

payment schedule at least once per year and shall establish

29

an alternative compliance payment schedule for additional

30

years as needed to promote the market for solar alternative

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1

energy credits.

2

(5)  The commission shall establish a process to provide

3

for, at least annually, a review of the alternative energy

4

market within this Commonwealth and the service territories

5

of the regional transmission organizations that manage the

6

transmission system in any part of this Commonwealth. The

7

commission will use the results of this study to identify any

8

needed changes to the cost associated with the alternative

9

compliance payment program. If the commission finds that the

10

costs associated with the alternative compliance payment

11

program must be changed, the commission shall present these

12

findings to the General Assembly for legislative enactment.

13

(g)  Transfer to sustainable development funds.--

14

(1)  Notwithstanding the provisions of 66 Pa.C.S. §§ 511

15

(relating to disposition, appropriation and disbursement of

16

assessments and fees) and 3315 (relating to disposition of

17

fines and penalties), alternative compliance payments imposed

18

pursuant to this act shall be paid into Pennsylvania's

19

Sustainable Energy Funds created under the commission's

20

restructuring orders under 66 Pa.C.S. Ch. 28 (relating to

21

restructuring of electric utility industry). Alternative

22

compliance payments shall be paid into a special fund of the

23

Pennsylvania Sustainable Energy Board, established by the

24

commission under Docket M-00031715, and made available to the

25

Regional Sustainable Energy Funds under procedures and

26

guidelines approved by the Pennsylvania Energy Board.

27

(2)  The alternative compliance payments shall be

28

utilized solely for projects that will increase the amount of

29

electric energy generated from alternative energy resources

30

for purposes of compliance with subsections [(b) and (c)] 

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1

(b), (c), (c.1) and (i).

2

* * *

3

(i)  Tier III share.--The requirements of this subsection are

4

separate and additional to the requirements of subsections (b),

5

(c) and (c.1).

6

(1)  The percentage of the electric energy required to be

7

sold by an electric distribution company or electric

8

generation supplier to retail electric customers in this

9

Commonwealth that shall be sold from alternative energy

10

sources identified in Tier III is:

11

(i)  3% for June 1, 2015, through May 31, 2016.

12

(ii)  3.5% for June 1, 2016, through May 31, 2017.

13

(iii)  4% for June 1, 2017, through May 31, 2018.

14

(iv)  4.5% for June 1, 2018, through May 31, 2019.

15

(v)  5% for June 1, 2019, through May 31, 2020.

16

(vi)  5.5% for June 1, 2020, through May 31, 2021.

17

(vii)  6% for June 1, 2021, through May 31, 2022.

18

(viii)  6.5% for June 1, 2022, through May 31, 2023.

19

(ix)  7% for June 1, 2023, through May 31, 2024.

20

(x)  7% for June 1, 2024, and thereafter.

21

(2)  Incremental nuclear energy shall supply not more

22

than 50% of the electric energy required by tier III in any

23

compliance year.

24

(3)  Electric distribution companies and electric

25

generation suppliers shall be excused from their obligations

26

under this subsection to the extent that the commission

27

determines that force majeure exists, provided the

28

requirements in the definition of "force majeure" in section

29

2 have been met.

30

Section 3.  The act is amended by adding sections to read:

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1

Section 8.1.  Sequestration facility permitting.

2

(a)  Prohibition.--No person may operate a carbon dioxide

3

sequestration facility without a permit from the department.

4

(b)  Facility sites.--The Environmental Quality Board shall,

5

by regulation, establish the conditions under which a carbon

6

dioxide sequestration facility may be located, developed and

7

operated. The regulations promulgated by the board shall provide

8

for the protection of public health, safety and environment and

9

shall include, but not be limited to, the following:

10

(1)  Geologic site characterization.

11

(2)  Sequestration facility performance standards.

12

(3)  Well location restrictions and well construction

13

standards, including operation and mechanical integrity

14

testing.

15

(4)  Risk assessment, corrective action and emergency

16

response requirements.

17

(5)  Monitoring, recordkeeping and reporting

18

requirements.

19

(6)  Facility closure, postclosure and final closure

20

certification requirements.

21

(7)  Financial assurance requirements, including bonding

22

or insurance, in amounts sufficient to ensure the carbon

23

sequestration facility will be constructed, operated, closed

24

and monitored during the postclosure period in accordance

25

with regulations promulgated under this section.

26

(8)  Fees in an amount sufficient to recover the

27

department's cost of administering this section.

28

(9)  Fees for every ton of carbon dioxide accepted by a

29

carbon dioxide sequestration facility in an amount sufficient

30

to monitor and maintain the facility after final closure of

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1

the facility and take remedial actions if necessary after

2

final closure of the facility. The fees shall be paid by the

3

operator of a carbon dioxide sequestration facility to the

4

department on a quarterly basis.

5

(10)  Public notice requirements, including notification

6

of a release.

7

(11)  Criteria used to determine that carbon dioxide has

8

been permanently sequestered.

9

(12)  Other requirements necessary to evaluate the

10

proposed carbon dioxide sequestration facility and to ensure

11

safe and environmentally protective operation of the

12

facility.

13

(c)  Powers, duties and enforcement authority of

14

department.--The department shall have the same powers, duties

15

and enforcement authority provided by the act of July 7, 1980

16

(P.L.380, No.97), known as the Solid Waste Management Act, to

17

carry out the purposes of this section. Operators of a carbon

18

dioxide sequestration facility shall have the same rights and be

19

subject to the same penalties as provided by the Solid Waste

20

Management Act; however, an administrative penalty assessed by

21

the department for a violation of this section shall not exceed

22

$50,000 per day per violation.

23

Section 8.2.  Title to carbon dioxide, immunity and transfer of

24

liability.

25

(a)  Title to carbon dioxide.--The right, title and interest

26

in and to carbon dioxide delivered to a carbon dioxide

27

sequestration facility by the advanced coal combustion with

28

limited carbon emission facilities that, individually or

29

collectively, first meet the maximum requirements of section

30

3(c.1), as determined by the department, shall be transferred to

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1

the carbon dioxide sequestration facility and the facility shall

2

accept and receive the right, title and interest in and to such

3

carbon dioxide, including, but not limited to, liabilities

4

associated with the carbon dioxide, current or future

5

environmental benefits, marketing claims, associated voluntary

6

or compliance-based emissions allocations or offsets, but not

7

alternative energy credits provided by section 3(e).

8

(b)  Immunity.--Upon and after transfer and conveyance of

9

carbon dioxide as provided under subsection (a), the owner of an

10

advanced coal combustion plant with limited carbon emissions

11

shall be immune from liabilities regarding the storage of carbon

12

dioxide within and the release, escape or migration of carbon

13

dioxide from the carbon dioxide sequestration facility.

14

(c)  Transfer of liability.--Upon final closure of a carbon

15

dioxide sequestration facility, as determined by the department,

16

the right, title or interest in the carbon dioxide and liability

17

for any release from the facility shall be transferred to and

18

accepted by the Commonwealth provided the operator of the carbon

19

dioxide sequestration facility has paid the appropriate fees

20

under section 8.1.

21

Section 8.3.  Carbon Dioxide Indemnification Fund.

22

(a)  Establishment.--There is hereby established in the State

23

Treasury a nonlapsing fund to be known as the Carbon Dioxide

24

Indemnification Fund. Money collected by the department under

25

section 8.1(b)(9) shall be deposited in the fund and shall only

26

be expended by the department to monitor and maintain carbon

27

dioxide sequestration facilities after final closure and to take

28

remedial actions, if necessary, after final closure.

29

(b)  Money collected under section 8.1.--Fines, civil

30

penalties and permit fees collected by the department under

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1

section 9 are hereby appropriated to the department to carry out

2

the purposes of section 8.1.

3

Section 8.4.  Carbon dioxide sequestration facility and

4

transportation pipeline on Commonwealth State forest

5

lands.

6

DCNR may lease State forest land owned by the Commonwealth to

7

any person, on terms and conditions as DCNR may consider

8

appropriate, for the development and operation of a carbon

9

dioxide sequestration facility and carbon dioxide transportation

10

pipeline necessary to deliver carbon dioxide to the facility. A

11

carbon dioxide sequestration facility or carbon dioxide

12

transportation pipeline developed and operated on Commonwealth

13

State forest lands shall only be utilized to store carbon

14

dioxide generated within this Commonwealth. All rents and other

15

payments from any lease of Commonwealth State forest land under

16

this section shall be deposited into the Environmental

17

Stewardship Fund established in 27 Pa.C.S. § 6104 (relating to

18

fund).

19

Section 8.5.  Application of the Public Utility Code to

20

transporters of carbon dioxide.

21

Entities transporting or conveying carbon dioxide by pipeline

22

or conduit for compensation under this act shall be considered a

23

public utility under 66 Pa.C.S. § 102 (relating to definitions)

24

and subject to the provisions of 66 Pa.C.S. (relating to public

25

utilities).

26

Section 4.  The provisions of this act are severable. If any

27

provision of this act or its application to any person or

28

circumstance is held invalid, the invalidity shall not affect

29

other provisions or applications of this act which can be given

30

effect without the invalid provision or application.

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1

Section 5.  Repeals are as follows:

<--

2

(1)  The General Assembly declares that the repeal under

3

paragraph (2) is necessary to effectuate the amendment of

4

section 3(e)(12) of the act.

5

(2)  Section 3.1 of the act of July 17, 2007 (P.L.114,

6

No.35), entitled "An act amending the act of November 30,

7

2004 (P.L.1672, No.213), entitled, 'An act providing for the

8

sale of electric energy generated from renewable and

9

environmentally beneficial sources, for the acquisition of

10

electric energy generated from renewable and environmentally

11

beneficial sources by electric distribution and supply

12

companies and for the powers and duties of the Pennsylvania

13

Public Utility Commission,' further providing for the

14

definitions of 'alternative energy credit,' 'customer-

15

generator,' 'force majeure,' 'net metering,' and 'Tier I

16

alternative energy source,' for alternative energy portfolio

17

standards, for portfolio requirements in other states and for

18

interconnection standards for customer-generator facilities,"

19

is repealed.

20

Section 6.  The amendment of section 3(e)(12) of the act

21

shall apply to all alternative energy credits created under the

22

act on or after the effective date of this section, regardless

23

of when any underlying contract for the purchase of electric

24

energy or other products from the generator that qualifies as an

25

alternative energy system was executed.

26

Section 5 7.  This act shall take effect immediately.

<--

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