<-1Providing for the regulation of certain reciprocal internal
2combustion engines; and imposing certain powers and duties on
3the Department of Environmental Protection.

<-4Providing for the registration and reporting of certain
5reciprocal internal combustion engines; imposing certain
6powers and duties on the Department of Environmental
7Protection; and providing for an air quality impact study.

8The General Assembly of the Commonwealth of Pennsylvania
9hereby enacts as follows:

<-10Section 1. Definitions.

11The following words and phrases when used in this act shall
12have the meanings given to them in this section unless the
13context clearly indicates otherwise:

14"Demand response generating resource." A generator which is
15compensated as a demand response resource by PJM or a generator
16compensated to participate in a demand response program for PJM.
17The term shall not include a generator that derives its energy
18from an alternative energy source that qualifies as a Tier I

1source under the act of November 30, 2004 (P.L.1672, No.213), 
2known as the Alternative Energy Portfolio Standards Act.

3"Department." The Department of Environmental Protection of
4the Commonwealth.

5"Energy year." The 12-month period beginning on June 1 and
6ending on May 31.

7"Environmental Protection Agency" or "EPA." The United
8States Environmental Protection Agency or the administrator of
9the United States Environmental Protection Agency.

10"Federal Energy Regulatory Commission" or "FERC." The
11Federal Energy Regulatory Commission or the administrator of the
12Federal Energy Regulatory Commission.

13"Generator." A machine powered by a reciprocating internal
14combustion engine that converts mechanical energy into electric
15energy.

16"PJM interconnection" or "PJM." The regional transmission
17organization registered to do business in this Commonwealth as
18PJM Interconnection, L.L.C., or any successor to PJM as the
19regional transmission organization, approved by the Federal
20Energy Regulatory Commission to manage the wholesale procurement
21of electricity and electric generation capacity, and serving all
22or parts of the states of Delaware, the District of Columbia,
23Illinois, Indiana, Kentucky, Maryland, Michigan, New Jersey,
24North Carolina, Ohio, Pennsylvania, Tennessee, Virginia and West
25Virginia.

26Section 2. Registration of demand response generating
27resources.

28(a) Registration.--Beginning with the energy year commencing
29in 2014 and every two years thereafter, demand response
30generating resources shall register with the department.

1Immediately upon any changes to the registration information
2provided under paragraph (1), (2), (3), (4), (5) or (6), updated
3registration information shall be submitted to the department.
4Within 90 days of the effective date of this act, the department
5shall provide the form and manner for the registration required
6under this section, which shall include:

7(1) A generator owner's contact information.

8(2) The physical address where the generator is or will
9be installed and the date of installation.

10(3) A description of the generator, including make,
11model number, serial number and year of manufacture.

12(4) The standby power rating of the generator and rated
13power of the engine powering the generator.

14(5) The type of demand response program in which the
15generator participates and the name and address of the
16aggregator, if any.

17(6) Any additional information the department deems
18necessary, consistent with 40 CFR §§ 60.4214(d)(1) (relating 
19to What are my notification, reporting, and recordkeeping 
20requirements if I am an owner or operator of a stationary CI 
21internal combustion engine?), 60.4245(e)(1) (relating to What 
22are my notification, reporting, and recordkeeping 
23requirements if I am an owner or operator of a stationary SI 
24internal combustion engine?) and 63.6650(h)(1) (relating to 
25What reports must I submit and when?).

26(b) Registration fees.--The department shall assess a
27registration fee for each demand response generating resource
28that registers in accordance with this section. For the energy
29year beginning in 2014, the fee shall be $40 per demand response
30generating resource. The fees authorized under this subsection

1shall be adjusted annually to reflect any upward changes in the
2Consumer Price Index for All Urban Consumers for the
3Pennsylvania, New Jersey, Delaware and Maryland area in the
4preceding 12 months, and the department shall immediately submit
5the adjusted amounts to the Legislative Reference Bureau for
6publication as a notice in the Pennsylvania Bulletin.

7Section 3. Reporting and recordkeeping requirements for demand
8response generating resources.

9(a) Reporting.--The owner or operator of a demand response
10generating resource shall annually report to the department all
11of the following information no later than 90 days after the
12completion of each energy year:

13(1) The daily and annual fuel types and amounts consumed
14by the engine powering each demand response generating
15resource.

16(2) The daily and annual hours of operation, delineated
17by testing and maintenance hours, emergency hours and
18nonemergency hours.

19(3) Any additional information the department deems
20necessary, consistent with 40 CFR §§ 60.4214(d)(1) (relating 
21to What are my notification, reporting, and recordkeeping 
22requirements if I am an owner or operator of a stationary CI 
23internal combustion engine?), 60.4245(e)(1) (relating to What 
24are my notification, reporting, and recordkeeping 
25requirements if I am an owner or operator of a stationary SI 
26internal combustion engine?) and 63.6650(h)(1) (relating to 
27What reports must I submit and when?).

28(b) Recordkeeping.--The owner or operator of a demand
29response generating resource shall maintain each record required
30by section 2 and this section for a minimum of five years after

1the date the record is made. The owner or operator shall
2promptly provide copies of records to the department, if
3requested.

4Section 4. Confidentiality.

5The registration and reporting requirements under sections 2
6and 3 shall be subject to the provisions of section 13.2 of the
7act of January 8, 1960 (1959 P.L.2119, No.787), known as the Air
8Pollution Control Act.

9Section 5. Blind compliance audit.

10(a) Department duties.--Beginning nine months after the
11beginning of the 2014 energy year, and at the beginning of every
12energy year thereafter, the department shall forward a list of
13demand response generating resources compiled under section 2(a)
14to the Pennsylvania Public Utility Commission for the purpose of
15an annual compliance audit.

16(b) Pennsylvania Public Utility Commission duties.--Pursuant
17to the authority provided to the Pennsylvania Public Utility
18Commission under PJM's Open Access Transmission Tariff,
19Attachment M, Section D and the "Required Disclosure" provisions
20of section 18.17.2 of the Operating Agreement of PJM, the
21commission shall conduct a blind compliance audit pursuant to
22this section to ensure that demand response generating resources
23participating in PJM programs and those demand response
24generating resources participating in programs established under
2566 Pa.C.S. § 2806.1 (relating to energy efficiency and
26conservation program) meet the requirements of this act. The
27commission shall do all of the following:

28(1) Request annually from PJM a listing of all demand
29response generating resources located in this Commonwealth.
30Except as provided for by this section, the commission shall

1not disclose any confidential or proprietary information
2received from PJM pursuant to this section.

3(2) Compare the list of demand response generating
4resources provided by the department under subsection (a)
5with the list of demand response generating resources
6provided under paragraph (1).

7(3) Where a demand response generating resource is found
8to be listed as a demand response generating resource in PJM
9but is not included on the list provided by the department,
10the commission shall confirm that the demand response
11generating resource is participating in the PJM markets as a
12demand response generating resource.

13(4) In any instance where the commission confirms that
14the demand response generating resource is participating in
15the PJM markets as a demand response generating resource but
16has not complied with this act, the commission shall notify
17FERC enforcement staff alleging a violation of PJM's Open
18Access Transmission Tariff, and may, at its discretion, also
19file a complaint with FERC, with a request that consideration
20of the complaint be expedited.

21(5) In any instance where the commission determines that
22noncompliance with this act is deliberate and continuing, the
23commission shall refer the matter to the Attorney General for
24prosecution under the act of December 17, 1968 (P.L.1224,
25No.387), known as the Unfair Trade Practices and Consumer
26Protection Law, and shall concomitantly notify the department
27that a referral has been made.

28Section 6. Violations and penalties.

29(a) Penalties.--The department shall establish and enforce
30civil penalties for failure to comply with sections 2 and 3. In

1determining the amount of the penalty, the department shall
2consider all of the following:

3(1) Willfulness of the violation.

4(2) Damage to air, soil, water or other natural resource
5of this Commonwealth or their uses.

6(3) Any financial benefit that the owner or operator
7realized as a result of noncompliance.

8(4) The necessity to deter future violations of this
9act.

10(5) The compliance history of the owner or operator.

11(6) Costs realized by the department as a result of the
12violation.

13(7) The size of the source or facility.

14(8) The severity and duration of the violation.

15(9) The owner's or operator's cooperation in resolving
16the violation.

17(10) The amount of time it took the owner or operator to
18achieve compliance.

19(11) Whether the violation was voluntarily reported.

20(12) Other factors unique to the owner or operator of
21the source or facility.

22(b) Continuing violations.--Each violation of any provision
23of this act and each day of continued violation shall constitute
24a separate offense and violation.

25(c) Limitation on action.--Notwithstanding the provisions of
26any other statute to the contrary, an action for a civil or
27criminal penalty under this act may be commenced at any time
28within a period of seven years from the date the offense is
29discovered.

30Section 7. Disposition of fees, fines and civil penalties.

1All fees, fines and civil penalties levied and collected
2under this act shall be paid into and administered in accordance
3with the Clean Air Fund, as established under section 9.2 of the
4act of January 8, 1960 (1959 P.L.2119, No.787), known as the Air
5Pollution Control Act.

6Section 8. Severability.

7The provisions of this act are severable. If any provision of
8this act or its application to any person or circumstance is
9held invalid, the invalidity shall not affect other provisions
10or applications of this act which can be given effect without
11the invalid provision or application.

12Section 9. Effective date.

13This act shall take effect immediately.

<-14Section 1. Short title.

15This act shall be known and may be cited as the Reciprocal
16Internal Combustion Engine Act.

17Section 2. Definitions.

18The following words and phrases when used in this act shall
19have the meanings given to them in this section unless the
20context clearly indicates otherwise:

21"Calendar year." The 12-month period beginning January 1 and
22ending December 31.

23"Demand response generating resource." A generator which is
24compensated as a demand response resource by PJM or a generator
25compensated to participate in a demand response program for PJM.
26The term shall not include a generator that derives its energy
27from an alternative energy source that qualifies as a Tier I
28energy source under the act of November 30, 2004 (P.L.1672,
29No.213), known as the Alternative Energy Portfolio Standards
30Act.

1"Department." The Department of Environmental Protection of
2the Commonwealth.

3"Generator." A machine powered by a reciprocal internal
4combustion engine that converts mechanical energy into electric
5energy.

6"PJM Interconnection" or "PJM." The independent system
7operator and regional transmission organization authorized by
8the Federal Energy Regulatory Commission to manage the wholesale
9procurement of electricity and electric generation capacity that
10serves this Commonwealth.

11"Small business." A for-profit corporation, limited
12liability company, partnership or proprietorship with net book
13value of assets totaling, at the beginning of each taxable year,
14as reported on the balance sheet, less than $5,000,000.

15"Stakeholders." A party that has a direct interest in this
16act, including representatives of environmental advocacy groups,
17the agriculture industry, electric power generators, owners or
18operators of demand response generating resources, conservation
19service provider as defined in 66 Pa.C.S. § 2806.1(m) (relating
20to energy efficiency and conservation program), the Office of
21Consumer Advocate and the Small Business Advocate.

22Section 3. Registration.

23(a) Requirement.--

24(1) Beginning with calendar year 2015, each demand
25response generating resource must register with the
26department.

27(2) Within 90 days of the effective date of this
28section, the department shall provide the form and manner for
29the registration required under this section, which shall
30include:

1(i) A generator owner's contact information.

2(ii) The physical address where the generator is or
3will be installed and the date of installation.

4(iii) A description of the generator's engine,
5including make, model, maximum engine rating in kW,
6horsepower or brake horsepower and model year.

7(iv) The type of demand response program in which
8the generator participates.

9(3) Within 45 days of a change to the registration
10information provided under paragraph (2), updated
11registration information must be submitted to the department.

12(b) Fee.--The department shall assess a registration fee for
13each demand response generating resource that registers in
14accordance with this section. For the calendar year beginning in
152015, the fee shall be $100 per demand response generating
16resource. The fee authorized under this subsection may be
17adjusted annually to reflect any upward changes in the Consumer
18Price Index for All Urban Consumers for the Pennsylvania, New
19Jersey, Delaware and Maryland area in the preceding 12 months,
20and the department shall immediately submit the adjusted amounts
21to the Legislative Reference Bureau for publication as a notice
22in the Pennsylvania Bulletin.

23Section 4. Reporting and recordkeeping requirements.

24(a) Reporting.--The owner or operator of a demand response
25generating resource must annually report to the department all
26of the following information no later than March 31 of each
27calendar year:

28(1) The annual fuel types utilized and estimated amounts
29consumed by the engine powering each demand response
30generating resource.

1(2) The daily and annual hours of demand response
2operations. For the purposes of this paragraph, a demand
3response operation shall include hours of operations that are
4used to meet contractual or other obligations as a demand
5response generating resource, including hours of operation
6for both PJM emergency demand response programs and PJM
7economic demand response programs, which must be separately
8reported to the department.

9(3) The estimated number of hours the engine operated
10for testing and maintenance or other similar purposes.

11(4) Any additional information the department deems
12necessary consistent with requirements under the following:

13(i) 40 CFR Pt. 60 Subpt. IIII (relating to standards
14of performance for stationary compression ignition
15internal combustion engines) or JJJJ (relating to
16standards of performance for stationary spark ignition
17internal combustion engines).

18(ii) 40 CFR Pt. 63 Subpt. ZZZZ (relating to National
19Emissions Standards for Hazardous Air Pollutants for
20Stationary Reciprocating Internal Combustion Engines).

21(b) Recordkeeping.--The owner or operator of a demand
22response generating resource must maintain each record required
23under section 3(a) and this section for a minimum of five years
24after the date the record is made. An owner or operator must
25promptly provide copies of records to the department, if
26requested.

27Section 5. Air quality impact study.

28(a) Authorization.--The department shall, utilizing a
29qualified independent third party, conduct a scientific study to
30determine if there is a relationship between the use of demand

1response generating resources and the Commonwealth's ability to
2achieve and maintain the National Ambient Air Quality Standards.
3The study shall determine if there are socioeconomic, health and
4environmental impacts associated with the use of demand response
5generating resources. The study must utilize a minimum of two
6years of data as reported to the department under section 3(a)
7from geographically dispersed locations and other verifiable and
8available data.

9(b) Criteria.--The department, in consultation with
10stakeholders, shall develop the criteria to be examined for the
11air quality impact study authorized under subsection (a). At a
12minimum, the criteria shall include all of the following:

13(1) An examination of the emissions produced from demand
14response generating resources, including benzene, ozone-
15forming precursors, carbon monoxide, oxides of nitrogen and
16particulate matter.

17(2) A cost-benefit analysis to determine the cost
18effectiveness of retrofitting demand response generating
19resources with commercially available technologies.

20(3) The impact to small businesses that own and operate
21demand response generating resources.

22(c) Findings and conclusions.--The air quality impact study
23authorized under subsection (a) shall be completed and a copy of
24the study and a summary of the findings and conclusions shall be
25transmitted to the chairman and minority chairman of the
26Environmental Resources and Energy Committee of the Senate and
27the chairman and minority chairman of the Environmental
28Resources and Energy Committee of the House of Representatives
29no later than December 31, 2017.

30(d) Appropriation.--Notwithstanding any other law, the

1department may utilize $250,000 of the unexpended Alternative
2Energy Series 2010B proceeds allocated to the department under
3section 304(a) of the act of July 9, 2008 (1st Sp.Sess.,
4P.L.1873, No.1), known as the Alternative Energy Investment Act,
5for the purpose of funding the study under this section.

6Section 6. Confidentiality.

7The registration and reporting requirements under sections 3
8and 4 shall be subject to all of the following:

9(1) Section 13.2 of the act of January 8, 1960 (1959
10P.L.2119, No.787), known as the Air Pollution Control Act.

11(2) The act of November 29, 2006 (P.L.1435, No.156), 
12known as the Public Utility Confidential Security Information 
13Disclosure Protection Act.

14Section 7. Blind compliance audit.

15(a) Department duties.--Beginning October 1, 2015, and at
16the beginning of every calendar year thereafter, the department
17shall forward a list of demand response generating resources
18compiled under section 3(a) to the Pennsylvania Public Utility
19Commission for the purpose of an annual compliance audit.

20(b) Pennsylvania Public Utility Commission duties.--Pursuant
21to the authority provided to the Pennsylvania Public Utility
22Commission under PJM's Open Access Transmission Tariff,
23Attachment M, Section D and the "Required Disclosure" provisions
24of section 18.17.2 of the Operating Agreement of PJM, the
25commission shall conduct a blind compliance audit under this
26section to ensure that demand response generating resources
27participating in PJM programs meet the requirements of this act.
28The commission shall do all of the following:

29(1) Request annually from PJM a listing of all demand
30response generating resources located in this Commonwealth.

1The commission may not disclose any confidential or
2proprietary information received from PJM pursuant to this
3section.

4(2) Compare the list of demand response generating
5resources provided by the department under subsection (a)
6with the list of demand response generating resources
7provided under paragraph (1).

8(3) If a demand response generating resource is found to
9be listed as a demand response generating resource in PJM but
10is not included on the list provided by the department, the
11commission shall confirm that the demand response generating
12resource is participating in the PJM markets as a demand
13response generating resource.

14(4) If the commission confirms that the demand response
15generating resource is participating in the PJM markets as a
16demand response generating resource but has not complied with
17this act, the commission shall act as follows:

18(i) The commission shall notify the owner and
19operator of the demand response generating resource and
20PJM of the violation. For a first offense, the owner or
21operator shall have 60 days to comply with this act and
22must provide evidence of compliance to the commission.
23If, after 60 days, the noncompliance continues, the
24commission shall proceed under section 8.

25(ii) For a second, subsequent or continuing offense,
26the commission shall proceed under section 8.

27Section 8. Violations and penalties.

28The commission shall enforce violations and levy penalties
29under this act as follows:

30(1) For a first offense under section 7(b)(4)(i), the

1commission shall levy a $300 civil penalty.

2(2) For a second, subsequent or continuing offense under
3section 7(b)(4)(ii), the commission shall levy a $500 civil
4penalty in addition to a $25 per day fine for each day of
5continued violation.

6Section 9. Disposition of fees, fines and civil penalties.

7(a) Fees.--Fees collected by the department under this act
8shall be retained by the department for the purpose of
9administration of this act.

10(b) Fines and civil penalties.--Fines and civil penalties
11collected by the commission under this act shall be retained by
12the commission for the purpose of administration of this act.

13Section 10. Environmental regulation.

14Prior to the air quality study under section 5 being
15completed, the department may not promulgate additional
16regulations providing for the environmental control of demand
17response generating resources.

18Section 11. Severability.

19The provisions of this act are severable. If any provision of
20this act or its application to any person or circumstance is
21held invalid, the invalidity shall not affect other provisions
22or applications of this act which can be given effect without
23the invalid provision or application.

24Section 12. Applicability.

25This act shall not apply to a generator that is not a demand
26response generating resource and that is operated in instances
27where there is onsite loss of electrical power or if the
28generator is being used solely to supply power as a result of a
29disruption in electric service.

30Section 40. Effective date.

1This act shall take effect immediately.