Public Act 098-0586
 
SB2350 EnrolledLRB098 10156 CEL 40315 b

    AN ACT concerning regulation.
 
    Be it enacted by the People of the State of Illinois,
represented in the General Assembly:
 
    Section 5. The Public Utilities Act is amended by changing
Sections 16-111.7 and 19-140 as follows:
 
    (220 ILCS 5/16-111.7)
    Sec. 16-111.7. On-bill financing program; electric
utilities.
    (a) The Illinois General Assembly finds that Illinois homes
and businesses have the potential to save energy through
conservation and cost-effective energy efficiency measures.
Programs created pursuant to this Section will allow utility
customers to purchase cost-effective energy efficiency
measures, including measures set forth in a
Commission-approved energy efficiency and demand-response plan
under Section 8-103 of this Act and that are cost-effective as
that term is defined by that Section, with no required initial
upfront payment, and to pay the cost of those products and
services over time on their utility bill.
    (b) Notwithstanding any other provision of this Act, an
electric utility serving more than 100,000 customers on January
1, 2009 shall offer a Commission-approved on-bill financing
program ("program") that allows its eligible retail customers,
as that term is defined in Section 16-111.5 of this Act, who
own a residential single family home, duplex, or other
residential building with 4 or less units, or condominium at
which the electric service is being provided (i) to borrow
funds from a third party lender in order to purchase electric
energy efficiency measures approved under the program for
installation in such home or condominium without any required
upfront payment and (ii) to pay back such funds over time
through the electric utility's bill. Based upon the process
described in subsection (b-5) of this Section, small commercial
retail customers, as that term is defined in Section 16-102 of
this Act, who own the premises at which electric service is
being provided may be included in such program. After receiving
a request from an electric utility for approval of a proposed
program and tariffs pursuant to this Section, the Commission
shall render its decision within 120 days. If no decision is
rendered within 120 days, then the request shall be deemed to
be approved.
    Beginning no later than December 31, 2013, an electric
utility subject to this subsection (b) shall also offer its
program to eligible retail customers that own multifamily
residential or mixed-use buildings with no more than 50
residential units, provided, however, that such customers must
either be a residential customer or small commercial customer
and may not use the program in such a way that repayment of the
cost of energy efficiency measures is made through tenants'
utility bills. An electric utility may impose a per site loan
limit not to exceed $150,000. The program, and loans issued
thereunder, shall only be offered to customers of the utility
that meet the requirements of this Section and that also have
an electric service account at the premises where the energy
efficiency measures being financed shall be installed.
    For purposes of this Section, "small commercial customer"
means, for an electric utility serving more than 3,000,000
retail customers, those customers having peak demand of less
than 100 kilowatts, and, for an electric utility serving less
than 3,000,000 retail customers, those customers having peak
demand of less than 150 kilowatts; provided, however, that in
the event the Commission, after the effective date of this
amendatory Act of the 98th General Assembly, approves changes
to a utility's tariffs that reflects new or revised demand
criteria for the utility's customer rate classifications, then
the utility may file a petition with the Commission to revise
the applicable definition of a small commercial customer to
reflect the new or revised demand criteria for the purposes of
this Section. After notice and hearing, the Commission shall
enter an order approving, or approving with modification, the
revised definition within 60 days after the utility files the
petition.
    (b-5) Within 30 days after the effective date of this
amendatory Act of the 96th General Assembly, the Commission
shall convene a workshop process during which interested
participants may discuss issues related to the program,
including program design, eligible electric energy efficiency
measures, vendor qualifications, and a methodology for
ensuring ongoing compliance with such qualifications,
financing, sample documents such as request for proposals,
contracts and agreements, dispute resolution, pre-installment
and post-installment verification, and evaluation. The
workshop process shall be completed within 150 days after the
effective date of this amendatory Act of the 96th General
Assembly.
    (c) Not later than 60 days following completion of the
workshop process described in subsection (b-5) of this Section,
each electric utility subject to subsection (b) of this Section
shall submit a proposed program to the Commission that contains
the following components:
        (1) A list of recommended electric energy efficiency
    measures that will be eligible for on-bill financing. An
    eligible electric energy efficiency measure ("measure")
    shall be a product or service for which one or more of the
    following is true defined by the following:
            (A) (blank); the measure would be applied to or
        replace electric energy-using equipment; and either
            (B) the projected application of the measure to
        equipment and systems will have estimated electricity
        savings (determined by rates in effect at the time of
        purchase), that are sufficient to cover the costs of
        implementing the measures, including finance charges
        and any program fees not recovered pursuant to
        subsection (f) of this Section; to assist the electric
        utility in identifying or approving measures, the
        utility may consult with the Department of Commerce and
        Economic Opportunity, as well as with retailers,
        technicians, and installers of electric energy
        efficiency measures and energy auditors (collectively
        "vendors"); or
            (C) the product or service measure is included in a
        Commission-approved energy efficiency and
        demand-response plan under Section 8-103 of this Act
        and is cost-effective as that term is defined by that
        Section.
        (2) The electric utility shall issue a request for
    proposals ("RFP") to lenders for purposes of providing
    financing to participants to pay for approved measures. The
    RFP criteria shall include, but not be limited to, the
    interest rate, origination fees, and credit terms. The
    utility shall select the winning bidders based on its
    evaluation of these criteria, with a preference for those
    bids containing the rates, fees, and terms most favorable
    to participants;
        (3) The utility shall work with the lenders selected
    pursuant to the RFP process, and with vendors, to establish
    the terms and processes pursuant to which a participant can
    purchase eligible electric energy efficiency measures
    using the financing obtained from the lender. The vendor
    shall explain and offer the approved financing packaging to
    those customers identified in subsection (b) of this
    Section and shall assist customers in applying for
    financing. As part of the process, vendors shall also
    provide to participants information about any other
    incentives that may be available for the measures.
        (4) The lender shall conduct credit checks or undertake
    other appropriate measures to limit credit risk, and shall
    review and approve or deny financing applications
    submitted by customers identified in subsection (b) of this
    Section. Following the lender's approval of financing and
    the participant's purchase of the measure or measures, the
    lender shall forward payment information to the electric
    utility, and the utility shall add as a separate line item
    on the participant's utility bill a charge showing the
    amount due under the program each month.
        (5) A loan issued to a participant pursuant to the
    program shall be the sole responsibility of the
    participant, and any dispute that may arise concerning the
    loan's terms, conditions, or charges shall be resolved
    between the participant and lender. Upon transfer of the
    property title for the premises at which the participant
    receives electric service from the utility or the
    participant's request to terminate service at such
    premises, the participant shall pay in full its electric
    utility bill, including all amounts due under the program,
    provided that this obligation may be modified as provided
    in subsection (g) of this Section. Amounts due under the
    program shall be deemed amounts owed for residential and,
    as appropriate, small commercial electric service.
        (6) The electric utility shall remit payment in full to
    the lender each month on behalf of the participant. In the
    event a participant defaults on payment of its electric
    utility bill, the electric utility shall continue to remit
    all payments due under the program to the lender, and the
    utility shall be entitled to recover all costs related to a
    participant's nonpayment through the automatic adjustment
    clause tariff established pursuant to Section 16-111.8 of
    this Act. In addition, the electric utility shall retain a
    security interest in the measure or measures purchased
    under the program, and the utility retains its right to
    disconnect a participant that defaults on the payment of
    its utility bill.
        (7) The total outstanding amount financed under the
    program in this subsection and subsection (c-5) of this
    Section program shall not exceed $2.5 million for an
    electric utility or electric utilities under a single
    holding company, provided that the electric utility or
    electric utilities may petition the Commission for an
    increase in such amount.
    (c-5) Within 120 days after the effective date of this
amendatory Act of the 98th General Assembly, each electric
utility subject to the requirements of this Section shall
submit an informational filing to the Commission that describes
its plan for implementing the provisions of this amendatory Act
of the 98th General Assembly on or before December 31, 2013.
Such filing shall also describe how the electric utility shall
coordinate its program with any gas utility or utilities that
provide gas service to buildings within the electric utility's
service territory so that it is practical and feasible for the
owner of a multifamily building to make a single application to
access loans for both gas and electric energy efficiency
measures in any individual building.
    (d) A program approved by the Commission shall also include
the following criteria and guidelines for such program:
        (1) guidelines for financing of measures installed
    under a program, including, but not limited to, RFP
    criteria and limits on both individual loan amounts and the
    duration of the loans;
        (2) criteria and standards for identifying and
    approving measures;
        (3) qualifications of vendors that will market or
    install measures, as well as a methodology for ensuring
    ongoing compliance with such qualifications;
        (4) sample contracts and agreements necessary to
    implement the measures and program; and
        (5) the types of data and information that utilities
    and vendors participating in the program shall collect for
    purposes of preparing the reports required under
    subsection (g) of this Section.
    (e) The proposed program submitted by each electric utility
shall be consistent with the provisions of this Section that
define operational, financial and billing arrangements between
and among program participants, vendors, lenders, and the
electric utility.
    (f) An electric utility shall recover all of the prudently
incurred costs of offering a program approved by the Commission
pursuant to this Section, including, but not limited to, all
start-up and administrative costs and the costs for program
evaluation. All prudently incurred costs under this Section
shall be recovered from the residential and small commercial
retail customer classes eligible to participate in the program
through the automatic adjustment clause tariff established
pursuant to Section 8-103 of this Act.
    (g) An independent evaluation of a program shall be
conducted after 3 years of the program's operation. The
electric utility shall retain an independent evaluator who
shall evaluate the effects of the measures installed under the
program and the overall operation of the program, including,
but not limited to, customer eligibility criteria and whether
the payment obligation for permanent electric energy
efficiency measures that will continue to provide benefits of
energy savings should attach to the meter location. As part of
the evaluation process, the evaluator shall also solicit
feedback from participants and interested stakeholders. The
evaluator shall issue a report to the Commission on its
findings no later than 4 years after the date on which the
program commenced, and the Commission shall issue a report to
the Governor and General Assembly including a summary of the
information described in this Section as well as its
recommendations as to whether the program should be
discontinued, continued with modification or modifications or
continued without modification, provided that any recommended
modifications shall only apply prospectively and to measures
not yet installed or financed.
    (h) An electric utility offering a Commission-approved
program pursuant to this Section shall not be required to
comply with any other statute, order, rule, or regulation of
this State that may relate to the offering of such program,
provided that nothing in this Section is intended to limit the
electric utility's obligation to comply with this Act and the
Commission's orders, rules, and regulations, including Part
280 of Title 83 of the Illinois Administrative Code.
    (i) The source of a utility customer's electric supply
shall not disqualify a customer from participation in the
utility's on-bill financing program. Customers of alternative
retail electric suppliers may participate in the program under
the same terms and conditions applicable to the utility's
supply customers.
(Source: P.A. 96-33, eff. 7-10-09; 97-616, eff. 10-26-11.)
 
    (220 ILCS 5/19-140)
    Sec. 19-140. On-bill financing program; gas utilities.
    (a) The Illinois General Assembly finds that Illinois homes
and businesses have the potential to save energy through
conservation and cost-effective energy efficiency measures.
Programs created pursuant to this Section will allow utility
customers to purchase cost-effective energy efficiency
measures, including measures set forth in a
Commission-approved energy efficiency plan under Section 8-104
of this Act, with no required initial upfront payment, and to
pay the cost of those products and services over time on their
utility bill.
    (b) Notwithstanding any other provision of this Act, a gas
utility serving more than 100,000 customers on January 1, 2009
shall offer a Commission-approved on-bill financing program
("program") that allows its retail customers who own a
residential single family home, duplex, or other residential
building with 4 or less units, or condominium at which the gas
service is being provided (i) to borrow funds from a third
party lender in order to purchase gas energy efficiency
measures approved under the program for installation in such
home or condominium without any required upfront payment and
(ii) to pay back such funds over time through the gas utility's
bill. Based upon the process described in subsection (b-5) of
this Section, small commercial retail customers, as that term
is defined in Section 19-105 of this Act, who own the premises
at which gas service is being provided may be included in such
program. After receiving a request from a gas utility for
approval of a proposed program and tariffs pursuant to this
Section, the Commission shall render its decision within 120
days. If no decision is rendered within 120 days, then the
request shall be deemed to be approved. Beginning no later than
December 31, 2013, a gas utility subject to this subsection (b)
shall also offer its program to eligible retail customers that
own a multifamily residential or mixed-use building with no
more than 50 residential units, provided, however, that such
customer must either be a residential customer or small
commercial customer and may not use the program in such a way
that repayment of the cost of energy efficiency measures is
made through tenants' utility bills. A gas utility may impose a
per site loan limit not to exceed $150,000. The program, and
loans issued thereunder, shall only be offered to customers of
the utility that meet the requirements of this Section and that
also have a gas service account at the premises where the
energy efficiency measures being financed shall be installed.
    For purposes of this Section, a small commercial customer
for a gas utility shall be defined in that gas utility's
informational filing that is made under subsection (c-5) of
this Section.
    (b-5) Within 30 days after the effective date of this
amendatory Act of the 96th General Assembly, the Commission
shall convene a workshop process during which interested
participants may discuss issues related to the program,
including program design, eligible gas energy efficiency
measures, vendor qualifications, and a methodology for
ensuring ongoing compliance with such qualifications,
financing, sample documents such as request for proposals,
contracts and agreements, dispute resolution, pre-installment
and post-installment verification, and evaluation. The
workshop process shall be completed within 150 days after the
effective date of this amendatory Act of the 96th General
Assembly.
    (c) Not later than 60 days following completion of the
workshop process described in subsection (b-5) of this Section,
each gas utility subject to subsection (b) of this Section
shall submit a proposed program to the Commission that contains
the following components:
        (1) A list of recommended gas energy efficiency
    measures that will be eligible for on-bill financing. An
    eligible gas energy efficiency measure ("measure") shall
    be a product or service for which one or more of the
    following is true defined by the following:
            (A) (blank); The measure would be applied to or
        replace gas energy-using equipment; and
            (B) the projected Application of the measure to
        equipment and systems will have estimated gas savings
        (determined by rates in effect at the time of
        purchase), that are sufficient to cover the costs of
        implementing the measures, including finance charges
        and any program fees not recovered pursuant to
        subsection (f) of this Section; or . To assist the gas
        utility in identifying or approving measures, the
        utility may consult with the Department of Commerce and
        Economic Opportunity, as well as with retailers,
        technicians and installers of gas energy efficiency
        measures and energy auditors (collectively "vendors").
            (C) the product or service is included in a
        Commission-approved energy efficiency plan under
        Section 8-104 of this Act.
        (2) The gas utility shall issue a request for proposals
    ("RFP") to lenders for purposes of providing financing to
    participants to pay for approved measures. The RFP criteria
    shall include, but not be limited to, the interest rate,
    origination fees, and credit terms. The utility shall
    select the winning bidders based on its evaluation of these
    criteria, with a preference for those bids containing the
    rates, fees, and terms most favorable to participants.
        (3) The utility shall work with the lenders selected
    pursuant to the RFP process, and with vendors, to establish
    the terms and processes pursuant to which a participant can
    purchase eligible gas energy efficiency measures using the
    financing obtained from the lender. The vendor shall
    explain and offer the approved financing packaging to those
    customers identified in subsection (b) of this Section and
    shall assist customers in applying for financing. As part
    of such process, vendors shall also provide to participants
    information about any other incentives that may be
    available for the measures.
        (4) The lender shall conduct credit checks or undertake
    other appropriate measures to limit credit risk, and shall
    review and approve or deny financing applications
    submitted by customers identified in subsection (b) of this
    Section. Following the lender's approval of financing and
    the participant's purchase of the measure or measures, the
    lender shall forward payment information to the gas
    utility, and the utility shall add as a separate line item
    on the participant's utility bill a charge showing the
    amount due under the program each month.
        (5) A loan issued to a participant pursuant to the
    program shall be the sole responsibility of the
    participant, and any dispute that may arise concerning the
    loan's terms, conditions, or charges shall be resolved
    between the participant and lender. Upon transfer of the
    property title for the premises at which the participant
    receives gas service from the utility or the participant's
    request to terminate service at such premises, the
    participant shall pay in full its gas utility bill,
    including all amounts due under the program, provided that
    this obligation may be modified as provided in subsection
    (g) of this Section. Amounts due under the program shall be
    deemed amounts owed for residential and, as appropriate,
    small commercial gas service.
        (6) The gas utility shall remit payment in full to the
    lender each month on behalf of the participant. In the
    event a participant defaults on payment of its gas utility
    bill, the gas utility shall continue to remit all payments
    due under the program to the lender, and the utility shall
    be entitled to recover all costs related to a participant's
    nonpayment through the automatic adjustment clause tariff
    established pursuant to Section 19-145 of this Act. In
    addition, the gas utility shall retain a security interest
    in the measure or measures purchased under the program, and
    the utility retains its right to disconnect a participant
    that defaults on the payment of its utility bill.
        (7) The total outstanding amount financed under the
    program in this subsection and subsection (c-5) of this
    Section program shall not exceed $2.5 million for a gas
    utility or gas utilities under a single holding company,
    provided that the gas utility or gas utilities may petition
    the Commission for an increase in such amount.
    (c-5) Within 120 days after the effective date of this
amendatory Act of the 98th General Assembly, each covered gas
utility shall submit an informational filing to the Commission
that describes its plan for implementing the provisions of this
amendatory Act of the 98th General Assembly on or before
December 31, 2013. A gas utility subject to this Section shall
cooperate with any electric utility that provides electric
service to buildings within the gas utility's service territory
so that it is practical and feasible for the owner of a
multifamily building to make a single application to access
loans for both gas and electric energy efficiency measures in
any individual building.
    (d) A program approved by the Commission shall also include
the following criteria and guidelines for such program:
        (1) guidelines for financing of measures installed
    under a program, including, but not limited to, RFP
    criteria and limits on both individual loan amounts and the
    duration of the loans;
        (2) criteria and standards for identifying and
    approving measures;
        (3) qualifications of vendors that will market or
    install measures, as well as a methodology for ensuring
    ongoing compliance with such qualifications;
        (4) sample contracts and agreements necessary to
    implement the measures and program; and
        (5) the types of data and information that utilities
    and vendors participating in the program shall collect for
    purposes of preparing the reports required under
    subsection (g) of this Section.
    (e) The proposed program submitted by each gas utility
shall be consistent with the provisions of this Section that
define operational, financial, and billing arrangements
between and among program participants, vendors, lenders, and
the gas utility.
    (f) A gas utility shall recover all of the prudently
incurred costs of offering a program approved by the Commission
pursuant to this Section, including, but not limited to, all
start-up and administrative costs and the costs for program
evaluation. All prudently incurred costs under this Section
shall be recovered from the residential and small commercial
retail customer classes eligible to participate in the program
through the automatic adjustment clause tariff established
pursuant to Section 8-104 of this Act.
    (g) An independent evaluation of a program shall be
conducted after 3 years of the program's operation. The gas
utility shall retain an independent evaluator who shall
evaluate the effects of the measures installed under the
program and the overall operation of the program, including,
but not limited to, customer eligibility criteria and whether
the payment obligation for permanent gas energy efficiency
measures that will continue to provide benefits of energy
savings should attach to the meter location. As part of the
evaluation process, the evaluator shall also solicit feedback
from participants and interested stakeholders. The evaluator
shall issue a report to the Commission on its findings no later
than 4 years after the date on which the program commenced, and
the Commission shall issue a report to the Governor and General
Assembly including a summary of the information described in
this Section as well as its recommendations as to whether the
program should be discontinued, continued with modification or
modifications or continued without modification, provided that
any recommended modifications shall only apply prospectively
and to measures not yet installed or financed.
    (h) A gas utility offering a Commission-approved program
pursuant to this Section shall not be required to comply with
any other statute, order, rule, or regulation of this State
that may relate to the offering of such program, provided that
nothing in this Section is intended to limit the gas utility's
obligation to comply with this Act and the Commission's orders,
rules, and regulations, including Part 280 of Title 83 of the
Illinois Administrative Code.
    (i) The source of a utility customer's gas supply shall not
disqualify a customer from participation in the utility's
on-bill financing program. Customers of alternative gas
suppliers may participate in the program under the same terms
and conditions applicable to the utility's supply customers.
(Source: P.A. 96-33, eff. 7-10-09.)
 
    Section 99. Effective date. This Act takes effect upon
becoming law.