H1203B1668A01719       JLW:JB  06/19/07    #90             A01719
                       AMENDMENTS TO HOUSE BILL NO. 1203
                                    Sponsor:  REPRESENTATIVE YEWCIC
                                           Printer's No. 1668

     1       Amend Sec. 2, page 3, line 6, by inserting after "3(b)"
     2               , (e)
     3       Amend Sec. 2 (Sec. 3), page 5, by inserting between lines 9
     4    and 10
     5       (e)  Alternative energy credits.--
     6           (1)  The commission shall establish an alternative energy
     7       credits program as needed to implement this act. The
     8       provision of services pursuant to this section shall be
     9       exempt from the competitive procurement procedures of 62
    10       Pa.C.S. (relating to procurement).
    11           (2)  The commission shall approve an independent entity
    12       to serve as the alternative energy credits program
    13       administrator. The administrator shall have those powers and
    14       duties assigned by commission regulations. Such powers and
    15       duties shall include, but not be limited to, the following:
    16               (i)  To create and administer an alternative energy
    17           credits certification, tracking and reporting program.
    18           This program should include, at a minimum, a process for
    19           qualifying alternative energy systems and determining the
    20           manner credits can be created, accounted for, transferred
    21           and retired.
    22               (ii)  To submit reports to the commission at such
    23           times and in such manner as the commission shall direct.
    24           (3)  All qualifying alternative energy systems must
    25       include a qualifying meter to record the cumulative electric
    26       production to verify the advanced energy credit value.
    27       Qualifying meters will be approved by the commission as
    28       defined in paragraph (4).
    29           (4)  (i)  An electric distribution company or electric
    30           generation supplier shall comply with the applicable
    31           requirements of this section by purchasing sufficient
    32           alternative energy credits and submitting documentation
    33           of compliance to the program administrator.
    34               (ii)  For purposes of this subsection, one
    35           alternative energy credit shall represent one megawatt
    36           hour of qualified alternative electric generation,
    37           whether self-generated, purchased along with the electric
    38           commodity or separately through a tradable instrument and
    39           otherwise meeting the requirements of commission
    40           regulations and the program administrator.

     1           (5)  The alternative energy credits program shall include
     2       provisions requiring a reporting period as defined in section
     3       2 for all covered entities under this act. The alternative
     4       energy credits program shall also include a true-up period as
     5       defined in section 2. The true-up period shall provide
     6       entities covered under this act the ability to obtain the
     7       required number of alternative energy credits or to make up
     8       any shortfall of the alternative energy credits they may be
     9       required to obtain to comply with this act. A force majeure
    10       provision shall also be provided for under the true-up period
    11       provisions.
    12           (6)  An electric distribution company and electric
    13       generation supplier may bank or place in reserve alternative
    14       energy credits produced in one reporting year for compliance
    15       in either or both of the two subsequent reporting years,
    16       subject to the limitations set forth in this subsection and
    17       provided that the electric distribution company and electric
    18       generation supplier are in compliance for all previous
    19       reporting years. In addition, the electric distribution
    20       company and electric generation supplier shall demonstrate to
    21       the satisfaction of the commission that such credits:
    22               (i)  were in excess of the alternative energy credits
    23           needed for compliance in the year in which they were
    24           generated and that such excess credits have not
    25           previously been used for compliance under this act;
    26               (ii)  were produced by the generation of electrical
    27           energy by alternative energy sources and sold to retail
    28           customers during the year in which they were generated;
    29           and
    30               (iii)  have not otherwise been nor will be sold,
    31           retired, claimed or represented as part of satisfying
    32           compliance with alternative or renewable energy portfolio
    33           standards in other states.
    34           (7)  An electric distribution company or an electric
    35       generation supplier with sales that are exempted under
    36       subsection (d) may bank credits for retail sales of
    37       electricity generated from Tier I and Tier II sources made
    38       prior to the end of the cost-recovery period and after the
    39       effective date of this act. Bankable credits shall be limited
    40       to credits associated with electricity sold from Tier I and
    41       Tier II sources during a reporting year which exceeds the
    42       volume of sales from such sources by an electric distribution
    43       company or electric generation supplier during the 12-month
    44       period immediately preceding the effective date of this act.
    45       All credits banked under this subsection shall be available
    46       for compliance with subsections (b) and (c) for no more than
    47       two reporting years following the conclusion of the cost-
    48       recovery period.
    49           (8)  The commission or its designee shall develop a
    50       registry of pertinent information regarding all available
    51       alternative energy credits, credit transactions among
    52       electric distribution companies and electric generation
    53       suppliers, the number of alternative energy credits sold or
    54       transferred and the price paid for the sale or transfer of
    55       the credits. The registry shall provide current information
    56       to electric distribution companies, electric generation
    57       suppliers and the general public on the status of alternative
    58       energy credits created, sold or transferred within this
    59       Commonwealth.

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     1           (9)  The commission may impose an administrative fee on
     2       an alternative energy credit transaction. The amount of this
     3       fee may not exceed the actual direct cost of processing the
     4       transaction by the alternative energy credits administrator.
     5       The commission is authorized to utilize up to 5% of the
     6       alternative compliance fees generated under subsection (f)
     7       for administrative expenses directly associated with this
     8       act.
     9           (10)  The commission shall establish regulations
    10       governing the verification and tracking of energy efficiency
    11       and demand-side management measures pursuant to this act,
    12       which shall include benefits to all utility customer classes.
    13       When developing regulations, the commission must give
    14       reasonable consideration to existing and proposed regulations
    15       and rules in existence in the regional transmission
    16       organizations that manage the transmission system in any part
    17       of this Commonwealth. All verified reductions shall accrue
    18       credits starting with the passage of this act.
    19           (11)  The commission shall within 120 days of the
    20       effective date of this act develop a depreciation schedule
    21       for alternative energy credits created through demand-side
    22       management, energy efficiency and load management
    23       technologies and shall develop standards for tracking and
    24       verifying savings from energy efficiency, load management and
    25       demand-side management measures. The commission shall allow
    26       for a 60-day public comment period and shall issue final
    27       standards within 30 days of the close of the public comment
    28       period.
    29           (12)  (i)  Unless a contractual provision explicitly
    30           assigns alternative energy credits in a different manner,
    31           the owner of the alternative energy system or a customer-
    32           generator owns any and all alternative energy credits
    33           associated with or created by the production of electric
    34           energy by such facility or customer, and the owner or
    35           customer shall be entitled to sell, transfer or take any
    36           other action to which a legal owner of property is
    37           entitled to take with respect to the credits.
    38               (ii)  This paragraph shall apply to all alternative
    39           energy credits which were created pursuant to this act
    40           prior to the effective date of this paragraph and which
    41           will be created after the effective date of this
    42           paragraph, regardless of when any underlying contract for
    43           the purchase of electric energy or other products from
    44           the generator that qualifies as an alternative energy
    45           system was executed.

    46       Amend Bill, page 8, by inserting between lines 13 and 14
    47       Section 3.  The addition of section 3(e)(12) of the act shall
    48    apply to all alternative energy credits created under the act
    49    before, on or after the effective date of this section,
    50    regardless of when any underlying contract for the purchase of
    51    electric energy or other products from the generator that
    52    qualifies as an alternative energy system was executed.

    53       Amend Sec. 3, page 8, line 14, by striking out "3" and
    54    inserting

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