Trial Engrossment of Amendment A04974 to House Bill 2338 P.N. 3302, Regular Session 2023-2024

A04974

THE GENERAL ASSEMBLY OF PENNSYLVANIA

HOUSE BILL

No.

2338

Session of

2024

INTRODUCED BY FIEDLER, O'MARA, STEELE, SCHLOSSBERG, HILL-EVANS,

D. WILLIAMS, WEBSTER, CURRY, KRAJEWSKI, SCOTT, VITALI,

SANCHEZ, BOYD, DONAHUE, SHUSTERMAN, T. DAVIS, KENYATTA,

BOROWSKI, ROZZI, SAPPEY, GUENST, HANBIDGE, HOHENSTEIN, KHAN,

McANDREW, WARREN AND MERSKI, MAY 28, 2024

AS REPORTED FROM COMMITTEE ON CONSUMER PROTECTION, TECHNOLOGY

AND UTILITIES, HOUSE OF REPRESENTATIVES, AS AMENDED,

JUNE 11, 2024

AN ACT

Amending the act of April 9, 1929 (P.L.177, No.175), entitled

"An act providing for and reorganizing the conduct of the

executive and administrative work of the Commonwealth by the

Executive Department thereof and the administrative

departments, boards, commissions, and officers thereof,

including the boards of trustees of State Normal Schools, or

Teachers Colleges; abolishing, creating, reorganizing or

authorizing the reorganization of certain administrative

departments, boards, and commissions; defining the powers and

duties of the Governor and other executive and administrative

officers, and of the several administrative departments,

boards, commissions, and officers; fixing the salaries of the

Governor, Lieutenant Governor, and certain other executive

and administrative officers; providing for the appointment of

certain administrative officers, and of all deputies and

other assistants and employes in certain departments, boards,

and commissions; providing for judicial administration; and

prescribing the manner in which the number and compensation

of the deputies and all other assistants and employes of

certain departments, boards and commissions shall be

determined," in Energy Development Authority and emergency

powers, further providing for definitions, for Energy

Development Authority, for powers and duties and for

authority indebtedness.

The General Assembly of the Commonwealth of Pennsylvania

hereby enacts as follows:

Section 1. The definitions of "cost" and "project" in

section 2801-C of the act of April 9, 1929 (P.L.177, No.175),

known as The Administrative Code of 1929, are amended to read:

Section 2801-C. Definitions.--The following words and

phrases when used in this article shall have the meanings given

to them in this section unless the context clearly indicates

otherwise:

* * *

"Cost" means the expense of construction and the expense of

acquisition of all structures, equipment, fixtures, lands and

other property rights and interests in land necessary to a

project. The term also includes the expense of demolishing,

removing or relocating any buildings, equipment, fixtures or

structures on lands acquired or to be acquired, including the

expense of acquiring any lands to which such buildings,

equipment, fixtures or structures may be moved or relocated;

storm water management; sewage treatment, waste treatment and

pollution control facilities; [railroad sidings, spurs or branch

lines;] all labor, materials, machinery, fixtures and

equipment[, fixtures]; financing charges; interest on all bonds

prior to and during construction, and for a period of one year

thereafter; engineering, financial and legal services; plans,

specifications, studies, surveys necessary or incidental to

determining the feasibility or practicability of constructing a

project; administrative expenses; reserves for interest and for

extension, enlargements, additions and improvements; and such

other expenses as may be necessary or incidental to the

construction of the project and the placing of the same in

operation[.], including expenses for energy audits,

environmental and geotechnical surveys, permits and other

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necessary approvals, planning and financing.

* * *

"Project" means [an] a structure, fixture, real and other

property and property rights and interests, facility,

undertaking or activity, entirely or largely located or

conducted in Pennsylvania, which cannot be effectively funded

using privately available resources, relating to:

(1) basic and applied research concerning energy use,

renewable energy resources and energy extraction, transmission,

storage or conversion;

(2) limited scale demonstration of innovative or

commercially unproven technology to promote the production, use

or conservation of energy; [or]

(3) activities to promote or remove obstacles to the

utilization and transportation of Pennsylvania energy resources,

including but not limited to limited scale synthetic fuel

facilities and the conversion or technological improvement of

industrial, commercial or agricultural systems to utilize

Pennsylvania indigenous energy resources, including coal or

renewable energy resources: Provided, That no such facility

unreasonably interferes with private waste recycling

industries[.];

(4) the development, generation, conservation, management,

delivery or storage of renewable energy resources for

residential, commercial, industrial, governmental, agricultural,

transportation or cogeneration use; or

(5) the strengthening of the resiliency of infrastructure

that supports the development, generation, conservation,

management, delivery, storage or efficient use of energy.

Section 2. Section 2803-C(b)(1), (2), (3) and (4) and (d) of

A04974 - 3 -

the act are amended and the section is amended by adding a

subsection to read:

Section 2803-C. Energy Development Authority.--* * *

(b) The authority shall be governed and all of its corporate

powers exercised by a board of directors which shall be composed

of the following individuals:

(1) [Nine] Five members to be appointed by the Governor[,

one of whom shall be designated as chairman]. At least two

members shall be members of the general public. The members

initially appointed shall serve for terms of two, three and four

years, respectively, the particular term of each to be

designated by the Governor at the time of appointment. The terms

of all of their successors shall be four years each, except that

any person appointed to fill a vacancy shall serve only for the

unexpired term. Every member's term shall extend until his

successor is appointed and qualified. Any appointment of a

member of the authority shall be subject to the advice and

consent of a majority of all of the members of the Senate. Any

appointed member of the authority shall be eligible for

reappointment.

(2) The Secretary of Environmental [Resources] Protection or

his designee.

(3) The Secretary of [Banking] Conservation and Natural

Resources or his designee.

(4) The Secretary of [Commerce] Community and Economic

Development or his designee.

* * *

(d) The board of directors shall provide for the holding of

regular and special meetings. [Ten] Eight directors attending

shall constitute a quorum for the transaction of any business

A04974 - 4 -

and at least [six] five votes shall be required to adopt any

action, except that at least [nine] seven votes shall be

required to approve financial assistance for any project.

(e) The Governor shall designate a member of the board to

serve as chairperson. The members shall select from among

themselves other officers as the members deem necessary.

Section 2. Section 2803-C heading, (a), (b)(1), (8) and (9)

and (d) of the act are amended and subsection (b) is amended by

adding a paragraph to read:

Section 2803-C. [Energy Development] Pennsylvania

Opportunities with Energy Reliability Authority.--(a) There is

hereby established the [Energy Development] Pennsylvania

Opportunities with Energy Reliability Authority.

(b) The authority shall be governed and all of its corporate

powers exercised by a board of directors which shall be composed

of the following individuals:

(1) [Nine members to be appointed by the Governor, one of

whom shall be designated as chairman. At least two members shall

be members of the general public. The members initially

appointed shall serve for terms of two, three and four years,

respectively, the particular term of each to be designated by

the Governor at the time of appointment. The terms of all of

their successors shall be four years each, except that any

person appointed to fill a vacancy shall serve only for the

unexpired term. Every member's term shall extend until his

successor is appointed and qualified. Any appointment of a

member of the authority shall be subject to the advice and

consent of a majority of all of the members of the Senate. Any

appointed member of the authority shall be eligible for

reappointment.] (Reserved).

A04974 - 5 -

* * *

(8) The Consumer Advocate or his designee shall serve as a

nonvoting member.

(9) The Chairman of the Public Utility Commission or his

designee shall serve as a nonvoting member.

(10) The Secretary of Transportation or his designee.

* * *

(d) The board of directors shall provide for the holding of

regular and special meetings. [Ten directors attending shall

constitute a quorum for the transaction of any business and at

least six votes shall be required to adopt any action, except

that at least nine votes shall be required to approve financial

assistance for any project.] The board shall meet at least ten

times in a calendar year. Five members of the board shall

constitute a quorum, and the following shall apply:

(1) The consent of at least five members of the board, with

at least four of the consenting members being appointed under

subsection (b)(6) and (7), shall be necessary to take action on

behalf of the authority for any of the following:

(i) Adopting bylaws.

(ii) Hiring professionals.

(iii) Authorizing bonds.

(iv) Approving projects and contracts.

(v) Adopting guidelines.

(2) At its first meeting after the effective date of this

subsection, the board shall elect a chairperson.

Section 3. Section 2806-C(2), (11), (14) and (18) of the act

are amended and the section is amended by adding paragraphs to

read:

Section 2806-C. Powers and Duties.--The authority, as a

A04974 - 6 -

public corporation and governmental instrumentality exercising

public powers of the Commonwealth, is hereby granted and shall

have and may exercise all powers necessary or appropriate to

carry out and effectuate the purposes of this article, including

the following powers, in addition to others herein granted:

* * *

(2) To have perpetual , UNTIL DECEMBER 31, 2035, existence

[for a term of fifty years, or until its existence shall be

terminated by law].

* * *

(11) To lease, lease with an option to purchase, sell by

installment sale or otherwise, or to otherwise dispose of, any

or all of its projects, or any or all of its real and other

property and property rights and interests necessary for a

project, in whole or in part, for such rentals or amounts and

upon such terms and conditions as the authority may deem proper.

* * *

(14) To make grants, loans and loan guarantees to fund

[research] projects, including pilot programs for projects.

* * *

(18) To receive appropriations and apply for and accept

grants, gifts, donations, bequests and settlements from any

public, quasi-public, nonprofit or private source[.], including

the Federal Government, the Commonwealth or any political

subdivision of the Commonwealth, corporations, associations,

partnerships, nonprofit corporations, charitable organizations,

foundations, estates and individuals. For purposes of this

paragraph, a "grant" shall include the Federal tax refund

generated by the authority's elective payment of an applicable

tax credit under the Inflation Reduction Act of 2022 (Public Law

A04974 - 7 -

117-169, 136 Stat. 1818). To the extent permitted by Federal

law, a "grant" shall also include a tax credit, or the total or

partial dollar value of a tax refund generated by the elective

payment of a tax credit, that is transferred, assigned, paid,

conveyed to or shared with the authority by a public, quasi-

public, nonprofit or private entity. Funds received by the

authority shall be deposited in the Energy Development Fund and

used for the purposes of the authority.

(19) To establish, through bylaws and any amendments to the

bylaws, its fiscal year.

(20) To consider assistance to low-income and moderate-

income individuals and disadvantaged communities, assistance to

small businesses and local governmental entities and job

creation, retention and training in establishing and

effectuating its priorities.

(21) To plan, design, develop, finance, construct, own,

operate, maintain and improve projects, including pilot programs

for projects, either alone or jointly with other entities,

provided that the authority, or a wholly owned subsidiary of the

authority, shall maintain majority ownership of a project at all

times unless or until it terminates its interest in the project

consistent with this section. The power under this paragraph

shall extend to projects on real property which the authority

does not own or in which the authority does not have a property

right or interest, subject to agreement by the owner of the real

property, right or interest.

(22) To provide capital, leverage private capital, provide

credit enhancements, make investments and provide other forms of

financial assistance for the development or deployment of

renewable energy resources in this Commonwealth, either directly

A04974 - 8 -

or by contract with an external administrator acting under the

oversight of the authority. The authority or its contractor may

invest in or finance projects alone or in conjunction with other

investors such as community development financial institutions,

insured credit unions and depository institutions and nonprofit

organizations that perform lending activities. Neither the

authority or its contractor may provide typical banking

functions or take deposits other than deposits from repayments

and other revenue received from financial assistance provided

under this section.

(23) To acquire, own, lease or maintain real and other

property and property rights and interests necessary for a

project.

(24) To apply for and receive, and assist a public, quasi-

public, nonprofit or private entity in applying for and

receiving, a Federal tax refund generated by the elective

payment of an applicable tax credit under the Inflation

Reduction Act of 2022. The authority may charge a reasonable fee

for providing assistance and shall deposit all fees collected

into the Energy Development Fund to be used for the purposes of

the authority.

Section 4. Section 2807-C(j) introductory paragraph of the

act is amended to read:

Section 2807-C. Authority Indebtedness.--* * *

(j) In the event that the authority shall default in the

payment of principal [of] or premium, if any, or interest on any

issue of bonds after the principal premium or interest shall

become due, whether at maturity, upon call for redemption or

otherwise and such default shall continue for a period of thirty

days or in the event that the authority shall fail or refuse to

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comply with the provisions of this act or shall default in any

agreement made with the holders of the bonds, the holders of

twenty-five percent (25%) in aggregate principal amount of the

bonds then outstanding of such issues, by instrument or

instruments filed in the Office of the Prothonotary of the

Commonwealth Court, may appoint a trustee to represent the

bondholders for the purpose herein provided. Such trustee and

any trustee under any indenture or other agreement, may, and

upon written request of the holders of twenty-five percent

(25%), or such other percentage as may be specified in any

indenture or other agreement aforesaid, in principal amount of

the particular issues of bonds then outstanding, shall, in his

or its own name:

* * *

Section 5. This act shall take effect immediately.

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