103RD GENERAL ASSEMBLY
State of Illinois
2023 and 2024
HB2563

 

Introduced 2/15/2023, by Rep. Dave Vella

 

SYNOPSIS AS INTRODUCED:
 
20 ILCS 3855/1-75

    Amends the Illinois Power Agency Act. Provides that any contractor involved in programs and procurements for the construction of State-funded solar and utility-scale wind projects must have 50% or more of the contractor's employees be residents of the State. Provides that the contractor must also participate in a registered apprenticeship program approved by the federal Department of Labor.


LRB103 29504 AMQ 55899 b

 

 

A BILL FOR

 

HB2563LRB103 29504 AMQ 55899 b

1    AN ACT concerning State government.
 
2    Be it enacted by the People of the State of Illinois,
3represented in the General Assembly:
 
4    Section 5. The Illinois Power Agency Act is amended by
5changing Section 1-75 as follows:
 
6    (20 ILCS 3855/1-75)
7    Sec. 1-75. Planning and Procurement Bureau. The Planning
8and Procurement Bureau has the following duties and
9responsibilities:
10    (a) The Planning and Procurement Bureau shall each year,
11beginning in 2008, develop procurement plans and conduct
12competitive procurement processes in accordance with the
13requirements of Section 16-111.5 of the Public Utilities Act
14for the eligible retail customers of electric utilities that
15on December 31, 2005 provided electric service to at least
16100,000 customers in Illinois. Beginning with the delivery
17year commencing on June 1, 2017, the Planning and Procurement
18Bureau shall develop plans and processes for the procurement
19of zero emission credits from zero emission facilities in
20accordance with the requirements of subsection (d-5) of this
21Section. Beginning on the effective date of this amendatory
22Act of the 102nd General Assembly, the Planning and
23Procurement Bureau shall develop plans and processes for the

 

 

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1procurement of carbon mitigation credits from carbon-free
2energy resources in accordance with the requirements of
3subsection (d-10) of this Section. The Planning and
4Procurement Bureau shall also develop procurement plans and
5conduct competitive procurement processes in accordance with
6the requirements of Section 16-111.5 of the Public Utilities
7Act for the eligible retail customers of small
8multi-jurisdictional electric utilities that (i) on December
931, 2005 served less than 100,000 customers in Illinois and
10(ii) request a procurement plan for their Illinois
11jurisdictional load. This Section shall not apply to a small
12multi-jurisdictional utility until such time as a small
13multi-jurisdictional utility requests the Agency to prepare a
14procurement plan for their Illinois jurisdictional load. For
15the purposes of this Section, the term "eligible retail
16customers" has the same definition as found in Section
1716-111.5(a) of the Public Utilities Act.
18    Beginning with the plan or plans to be implemented in the
192017 delivery year, the Agency shall no longer include the
20procurement of renewable energy resources in the annual
21procurement plans required by this subsection (a), except as
22provided in subsection (q) of Section 16-111.5 of the Public
23Utilities Act, and shall instead develop a long-term renewable
24resources procurement plan in accordance with subsection (c)
25of this Section and Section 16-111.5 of the Public Utilities
26Act.

 

 

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1    In accordance with subsection (c-5) of this Section, the
2Planning and Procurement Bureau shall oversee the procurement
3by electric utilities that served more than 300,000 retail
4customers in this State as of January 1, 2019 of renewable
5energy credits from new utility-scale solar projects to be
6installed, along with energy storage facilities, at or
7adjacent to the sites of electric generating facilities that,
8as of January 1, 2016, burned coal as their primary fuel
9source.
10        (1) The Agency shall each year, beginning in 2008, as
11    needed, issue a request for qualifications for experts or
12    expert consulting firms to develop the procurement plans
13    in accordance with Section 16-111.5 of the Public
14    Utilities Act. In order to qualify an expert or expert
15    consulting firm must have:
16            (A) direct previous experience assembling
17        large-scale power supply plans or portfolios for
18        end-use customers;
19            (B) an advanced degree in economics, mathematics,
20        engineering, risk management, or a related area of
21        study;
22            (C) 10 years of experience in the electricity
23        sector, including managing supply risk;
24            (D) expertise in wholesale electricity market
25        rules, including those established by the Federal
26        Energy Regulatory Commission and regional transmission

 

 

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1        organizations;
2            (E) expertise in credit protocols and familiarity
3        with contract protocols;
4            (F) adequate resources to perform and fulfill the
5        required functions and responsibilities; and
6            (G) the absence of a conflict of interest and
7        inappropriate bias for or against potential bidders or
8        the affected electric utilities.
9        (2) The Agency shall each year, as needed, issue a
10    request for qualifications for a procurement administrator
11    to conduct the competitive procurement processes in
12    accordance with Section 16-111.5 of the Public Utilities
13    Act. In order to qualify an expert or expert consulting
14    firm must have:
15            (A) direct previous experience administering a
16        large-scale competitive procurement process;
17            (B) an advanced degree in economics, mathematics,
18        engineering, or a related area of study;
19            (C) 10 years of experience in the electricity
20        sector, including risk management experience;
21            (D) expertise in wholesale electricity market
22        rules, including those established by the Federal
23        Energy Regulatory Commission and regional transmission
24        organizations;
25            (E) expertise in credit and contract protocols;
26            (F) adequate resources to perform and fulfill the

 

 

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1        required functions and responsibilities; and
2            (G) the absence of a conflict of interest and
3        inappropriate bias for or against potential bidders or
4        the affected electric utilities.
5        (3) The Agency shall provide affected utilities and
6    other interested parties with the lists of qualified
7    experts or expert consulting firms identified through the
8    request for qualifications processes that are under
9    consideration to develop the procurement plans and to
10    serve as the procurement administrator. The Agency shall
11    also provide each qualified expert's or expert consulting
12    firm's response to the request for qualifications. All
13    information provided under this subparagraph shall also be
14    provided to the Commission. The Agency may provide by rule
15    for fees associated with supplying the information to
16    utilities and other interested parties. These parties
17    shall, within 5 business days, notify the Agency in
18    writing if they object to any experts or expert consulting
19    firms on the lists. Objections shall be based on:
20            (A) failure to satisfy qualification criteria;
21            (B) identification of a conflict of interest; or
22            (C) evidence of inappropriate bias for or against
23        potential bidders or the affected utilities.
24        The Agency shall remove experts or expert consulting
25    firms from the lists within 10 days if there is a
26    reasonable basis for an objection and provide the updated

 

 

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1    lists to the affected utilities and other interested
2    parties. If the Agency fails to remove an expert or expert
3    consulting firm from a list, an objecting party may seek
4    review by the Commission within 5 days thereafter by
5    filing a petition, and the Commission shall render a
6    ruling on the petition within 10 days. There is no right of
7    appeal of the Commission's ruling.
8        (4) The Agency shall issue requests for proposals to
9    the qualified experts or expert consulting firms to
10    develop a procurement plan for the affected utilities and
11    to serve as procurement administrator.
12        (5) The Agency shall select an expert or expert
13    consulting firm to develop procurement plans based on the
14    proposals submitted and shall award contracts of up to 5
15    years to those selected.
16        (6) The Agency shall select an expert or expert
17    consulting firm, with approval of the Commission, to serve
18    as procurement administrator based on the proposals
19    submitted. If the Commission rejects, within 5 days, the
20    Agency's selection, the Agency shall submit another
21    recommendation within 3 days based on the proposals
22    submitted. The Agency shall award a 5-year contract to the
23    expert or expert consulting firm so selected with
24    Commission approval.
25    (b) The experts or expert consulting firms retained by the
26Agency shall, as appropriate, prepare procurement plans, and

 

 

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1conduct a competitive procurement process as prescribed in
2Section 16-111.5 of the Public Utilities Act, to ensure
3adequate, reliable, affordable, efficient, and environmentally
4sustainable electric service at the lowest total cost over
5time, taking into account any benefits of price stability, for
6eligible retail customers of electric utilities that on
7December 31, 2005 provided electric service to at least
8100,000 customers in the State of Illinois, and for eligible
9Illinois retail customers of small multi-jurisdictional
10electric utilities that (i) on December 31, 2005 served less
11than 100,000 customers in Illinois and (ii) request a
12procurement plan for their Illinois jurisdictional load.
13    (c) Renewable portfolio standard.
14        (1)(A) The Agency shall develop a long-term renewable
15    resources procurement plan that shall include procurement
16    programs and competitive procurement events necessary to
17    meet the goals set forth in this subsection (c). The
18    initial long-term renewable resources procurement plan
19    shall be released for comment no later than 160 days after
20    June 1, 2017 (the effective date of Public Act 99-906).
21    The Agency shall review, and may revise on an expedited
22    basis, the long-term renewable resources procurement plan
23    at least every 2 years, which shall be conducted in
24    conjunction with the procurement plan under Section
25    16-111.5 of the Public Utilities Act to the extent
26    practicable to minimize administrative expense. No later

 

 

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1    than 120 days after the effective date of this amendatory
2    Act of the 102nd General Assembly, the Agency shall
3    release for comment a revision to the long-term renewable
4    resources procurement plan, updating elements of the most
5    recently approved plan as needed to comply with this
6    amendatory Act of the 102nd General Assembly, and any
7    long-term renewable resources procurement plan update
8    published by the Agency but not yet approved by the
9    Illinois Commerce Commission shall be withdrawn. The
10    long-term renewable resources procurement plans shall be
11    subject to review and approval by the Commission under
12    Section 16-111.5 of the Public Utilities Act.
13        (B) Subject to subparagraph (F) of this paragraph (1),
14    the long-term renewable resources procurement plan shall
15    attempt to meet the goals for procurement of renewable
16    energy credits at levels of at least the following overall
17    percentages: 13% by the 2017 delivery year; increasing by
18    at least 1.5% each delivery year thereafter to at least
19    25% by the 2025 delivery year; increasing by at least 3%
20    each delivery year thereafter to at least 40% by the 2030
21    delivery year, and continuing at no less than 40% for each
22    delivery year thereafter. The Agency shall attempt to
23    procure 50% by delivery year 2040. The Agency shall
24    determine the annual increase between delivery year 2030
25    and delivery year 2040, if any, taking into account energy
26    demand, other energy resources, and other public policy

 

 

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1    goals. In the event of a conflict between these goals and
2    the new wind and new photovoltaic procurement requirements
3    described in items (i) through (iii) of subparagraph (C)
4    of this paragraph (1), the long-term plan shall prioritize
5    compliance with the new wind and new photovoltaic
6    procurement requirements described in items (i) through
7    (iii) of subparagraph (C) of this paragraph (1) over the
8    annual percentage targets described in this subparagraph
9    (B). The Agency shall not comply with the annual
10    percentage targets described in this subparagraph (B) by
11    procuring renewable energy credits that are unlikely to
12    lead to the development of new renewable resources.
13        For the delivery year beginning June 1, 2017, the
14    procurement plan shall attempt to include, subject to the
15    prioritization outlined in this subparagraph (B),
16    cost-effective renewable energy resources equal to at
17    least 13% of each utility's load for eligible retail
18    customers and 13% of the applicable portion of each
19    utility's load for retail customers who are not eligible
20    retail customers, which applicable portion shall equal 50%
21    of the utility's load for retail customers who are not
22    eligible retail customers on February 28, 2017.
23        For the delivery year beginning June 1, 2018, the
24    procurement plan shall attempt to include, subject to the
25    prioritization outlined in this subparagraph (B),
26    cost-effective renewable energy resources equal to at

 

 

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1    least 14.5% of each utility's load for eligible retail
2    customers and 14.5% of the applicable portion of each
3    utility's load for retail customers who are not eligible
4    retail customers, which applicable portion shall equal 75%
5    of the utility's load for retail customers who are not
6    eligible retail customers on February 28, 2017.
7        For the delivery year beginning June 1, 2019, and for
8    each year thereafter, the procurement plans shall attempt
9    to include, subject to the prioritization outlined in this
10    subparagraph (B), cost-effective renewable energy
11    resources equal to a minimum percentage of each utility's
12    load for all retail customers as follows: 16% by June 1,
13    2019; increasing by 1.5% each year thereafter to 25% by
14    June 1, 2025; and 25% by June 1, 2026; increasing by at
15    least 3% each delivery year thereafter to at least 40% by
16    the 2030 delivery year, and continuing at no less than 40%
17    for each delivery year thereafter. The Agency shall
18    attempt to procure 50% by delivery year 2040. The Agency
19    shall determine the annual increase between delivery year
20    2030 and delivery year 2040, if any, taking into account
21    energy demand, other energy resources, and other public
22    policy goals.
23        For each delivery year, the Agency shall first
24    recognize each utility's obligations for that delivery
25    year under existing contracts. Any renewable energy
26    credits under existing contracts, including renewable

 

 

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1    energy credits as part of renewable energy resources,
2    shall be used to meet the goals set forth in this
3    subsection (c) for the delivery year.
4        (C) The long-term renewable resources procurement plan
5    described in subparagraph (A) of this paragraph (1) shall
6    include the procurement of renewable energy credits from
7    new projects in amounts equal to at least the following:
8            (i) 10,000,000 renewable energy credits delivered
9        annually by the end of the 2021 delivery year, and
10        increasing ratably to reach 45,000,000 renewable
11        energy credits delivered annually from new wind and
12        solar projects by the end of delivery year 2030 such
13        that the goals in subparagraph (B) of this paragraph
14        (1) are met entirely by procurements of renewable
15        energy credits from new wind and photovoltaic
16        projects. Of that amount, to the extent possible, the
17        Agency shall procure 45% from wind projects and 55%
18        from photovoltaic projects. Of the amount to be
19        procured from photovoltaic projects, the Agency shall
20        procure: at least 50% from solar photovoltaic projects
21        using the program outlined in subparagraph (K) of this
22        paragraph (1) from distributed renewable energy
23        generation devices or community renewable generation
24        projects; at least 47% from utility-scale solar
25        projects; at least 3% from brownfield site
26        photovoltaic projects that are not community renewable

 

 

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1        generation projects.
2            In developing the long-term renewable resources
3        procurement plan, the Agency shall consider other
4        approaches, in addition to competitive procurements,
5        that can be used to procure renewable energy credits
6        from brownfield site photovoltaic projects and thereby
7        help return blighted or contaminated land to
8        productive use while enhancing public health and the
9        well-being of Illinois residents, including those in
10        environmental justice communities, as defined using
11        existing methodologies and findings used by the Agency
12        and its Administrator in its Illinois Solar for All
13        Program.
14            (ii) In any given delivery year, if forecasted
15        expenses are less than the maximum budget available
16        under subparagraph (E) of this paragraph (1), the
17        Agency shall continue to procure new renewable energy
18        credits until that budget is exhausted in the manner
19        outlined in item (i) of this subparagraph (C).
20            (iii) For purposes of this Section:
21            "New wind projects" means wind renewable energy
22        facilities that are energized after June 1, 2017 for
23        the delivery year commencing June 1, 2017.
24            "New photovoltaic projects" means photovoltaic
25        renewable energy facilities that are energized after
26        June 1, 2017. Photovoltaic projects developed under

 

 

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1        Section 1-56 of this Act shall not apply towards the
2        new photovoltaic project requirements in this
3        subparagraph (C).
4            For purposes of calculating whether the Agency has
5        procured enough new wind and solar renewable energy
6        credits required by this subparagraph (C), renewable
7        energy facilities that have a multi-year renewable
8        energy credit delivery contract with the utility
9        through at least delivery year 2030 shall be
10        considered new, however no renewable energy credits
11        from contracts entered into before June 1, 2021 shall
12        be used to calculate whether the Agency has procured
13        the correct proportion of new wind and new solar
14        contracts described in this subparagraph (C) for
15        delivery year 2021 and thereafter.
16        (D) Renewable energy credits shall be cost effective.
17    For purposes of this subsection (c), "cost effective"
18    means that the costs of procuring renewable energy
19    resources do not cause the limit stated in subparagraph
20    (E) of this paragraph (1) to be exceeded and, for
21    renewable energy credits procured through a competitive
22    procurement event, do not exceed benchmarks based on
23    market prices for like products in the region. For
24    purposes of this subsection (c), "like products" means
25    contracts for renewable energy credits from the same or
26    substantially similar technology, same or substantially

 

 

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1    similar vintage (new or existing), the same or
2    substantially similar quantity, and the same or
3    substantially similar contract length and structure.
4    Benchmarks shall reflect development, financing, or
5    related costs resulting from requirements imposed through
6    other provisions of State law, including, but not limited
7    to, requirements in subparagraphs (P) and (Q) of this
8    paragraph (1) and the Renewable Energy Facilities
9    Agricultural Impact Mitigation Act. Confidential
10    benchmarks shall be developed by the procurement
11    administrator, in consultation with the Commission staff,
12    Agency staff, and the procurement monitor and shall be
13    subject to Commission review and approval. If price
14    benchmarks for like products in the region are not
15    available, the procurement administrator shall establish
16    price benchmarks based on publicly available data on
17    regional technology costs and expected current and future
18    regional energy prices. The benchmarks in this Section
19    shall not be used to curtail or otherwise reduce
20    contractual obligations entered into by or through the
21    Agency prior to June 1, 2017 (the effective date of Public
22    Act 99-906).
23        (E) For purposes of this subsection (c), the required
24    procurement of cost-effective renewable energy resources
25    for a particular year commencing prior to June 1, 2017
26    shall be measured as a percentage of the actual amount of

 

 

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1    electricity (megawatt-hours) supplied by the electric
2    utility to eligible retail customers in the delivery year
3    ending immediately prior to the procurement, and, for
4    delivery years commencing on and after June 1, 2017, the
5    required procurement of cost-effective renewable energy
6    resources for a particular year shall be measured as a
7    percentage of the actual amount of electricity
8    (megawatt-hours) delivered by the electric utility in the
9    delivery year ending immediately prior to the procurement,
10    to all retail customers in its service territory. For
11    purposes of this subsection (c), the amount paid per
12    kilowatthour means the total amount paid for electric
13    service expressed on a per kilowatthour basis. For
14    purposes of this subsection (c), the total amount paid for
15    electric service includes without limitation amounts paid
16    for supply, transmission, capacity, distribution,
17    surcharges, and add-on taxes.
18        Notwithstanding the requirements of this subsection
19    (c), the total of renewable energy resources procured
20    under the procurement plan for any single year shall be
21    subject to the limitations of this subparagraph (E). Such
22    procurement shall be reduced for all retail customers
23    based on the amount necessary to limit the annual
24    estimated average net increase due to the costs of these
25    resources included in the amounts paid by eligible retail
26    customers in connection with electric service to no more

 

 

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1    than 4.25% of the amount paid per kilowatthour by those
2    customers during the year ending May 31, 2009. To arrive
3    at a maximum dollar amount of renewable energy resources
4    to be procured for the particular delivery year, the
5    resulting per kilowatthour amount shall be applied to the
6    actual amount of kilowatthours of electricity delivered,
7    or applicable portion of such amount as specified in
8    paragraph (1) of this subsection (c), as applicable, by
9    the electric utility in the delivery year immediately
10    prior to the procurement to all retail customers in its
11    service territory. The calculations required by this
12    subparagraph (E) shall be made only once for each delivery
13    year at the time that the renewable energy resources are
14    procured. Once the determination as to the amount of
15    renewable energy resources to procure is made based on the
16    calculations set forth in this subparagraph (E) and the
17    contracts procuring those amounts are executed, no
18    subsequent rate impact determinations shall be made and no
19    adjustments to those contract amounts shall be allowed.
20    All costs incurred under such contracts shall be fully
21    recoverable by the electric utility as provided in this
22    Section.
23        (F) If the limitation on the amount of renewable
24    energy resources procured in subparagraph (E) of this
25    paragraph (1) prevents the Agency from meeting all of the
26    goals in this subsection (c), the Agency's long-term plan

 

 

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1    shall prioritize compliance with the requirements of this
2    subsection (c) regarding renewable energy credits in the
3    following order:
4            (i) renewable energy credits under existing
5        contractual obligations as of June 1, 2021;
6            (i-5) funding for the Illinois Solar for All
7        Program, as described in subparagraph (O) of this
8        paragraph (1);
9            (ii) renewable energy credits necessary to comply
10        with the new wind and new photovoltaic procurement
11        requirements described in items (i) through (iii) of
12        subparagraph (C) of this paragraph (1); and
13            (iii) renewable energy credits necessary to meet
14        the remaining requirements of this subsection (c).
15        (G) The following provisions shall apply to the
16    Agency's procurement of renewable energy credits under
17    this subsection (c):
18            (i) Notwithstanding whether a long-term renewable
19        resources procurement plan has been approved, the
20        Agency shall conduct an initial forward procurement
21        for renewable energy credits from new utility-scale
22        wind projects within 160 days after June 1, 2017 (the
23        effective date of Public Act 99-906). For the purposes
24        of this initial forward procurement, the Agency shall
25        solicit 15-year contracts for delivery of 1,000,000
26        renewable energy credits delivered annually from new

 

 

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1        utility-scale wind projects to begin delivery on June
2        1, 2019, if available, but not later than June 1, 2021,
3        unless the project has delays in the establishment of
4        an operating interconnection with the applicable
5        transmission or distribution system as a result of the
6        actions or inactions of the transmission or
7        distribution provider, or other causes for force
8        majeure as outlined in the procurement contract, in
9        which case, not later than June 1, 2022. Payments to
10        suppliers of renewable energy credits shall commence
11        upon delivery. Renewable energy credits procured under
12        this initial procurement shall be included in the
13        Agency's long-term plan and shall apply to all
14        renewable energy goals in this subsection (c).
15            (ii) Notwithstanding whether a long-term renewable
16        resources procurement plan has been approved, the
17        Agency shall conduct an initial forward procurement
18        for renewable energy credits from new utility-scale
19        solar projects and brownfield site photovoltaic
20        projects within one year after June 1, 2017 (the
21        effective date of Public Act 99-906). For the purposes
22        of this initial forward procurement, the Agency shall
23        solicit 15-year contracts for delivery of 1,000,000
24        renewable energy credits delivered annually from new
25        utility-scale solar projects and brownfield site
26        photovoltaic projects to begin delivery on June 1,

 

 

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1        2019, if available, but not later than June 1, 2021,
2        unless the project has delays in the establishment of
3        an operating interconnection with the applicable
4        transmission or distribution system as a result of the
5        actions or inactions of the transmission or
6        distribution provider, or other causes for force
7        majeure as outlined in the procurement contract, in
8        which case, not later than June 1, 2022. The Agency may
9        structure this initial procurement in one or more
10        discrete procurement events. Payments to suppliers of
11        renewable energy credits shall commence upon delivery.
12        Renewable energy credits procured under this initial
13        procurement shall be included in the Agency's
14        long-term plan and shall apply to all renewable energy
15        goals in this subsection (c).
16            (iii) Notwithstanding whether the Commission has
17        approved the periodic long-term renewable resources
18        procurement plan revision described in Section
19        16-111.5 of the Public Utilities Act, the Agency shall
20        conduct at least one subsequent forward procurement
21        for renewable energy credits from new utility-scale
22        wind projects, new utility-scale solar projects, and
23        new brownfield site photovoltaic projects within 240
24        days after the effective date of this amendatory Act
25        of the 102nd General Assembly in quantities necessary
26        to meet the requirements of subparagraph (C) of this

 

 

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1        paragraph (1) through the delivery year beginning June
2        1, 2021.
3            (iv) Notwithstanding whether the Commission has
4        approved the periodic long-term renewable resources
5        procurement plan revision described in Section
6        16-111.5 of the Public Utilities Act, the Agency shall
7        open capacity for each category in the Adjustable
8        Block program within 90 days after the effective date
9        of this amendatory Act of the 102nd General Assembly
10        manner:
11                (1) The Agency shall open the first block of
12            annual capacity for the category described in item
13            (i) of subparagraph (K) of this paragraph (1). The
14            first block of annual capacity for item (i) shall
15            be for at least 75 megawatts of total nameplate
16            capacity. The price of the renewable energy credit
17            for this block of capacity shall be 4% less than
18            the price of the last open block in this category.
19            Projects on a waitlist shall be awarded contracts
20            first in the order in which they appear on the
21            waitlist. Notwithstanding anything to the
22            contrary, for those renewable energy credits that
23            qualify and are procured under this subitem (1) of
24            this item (iv), the renewable energy credit
25            delivery contract value shall be paid in full,
26            based on the estimated generation during the first

 

 

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1            15 years of operation, by the contracting
2            utilities at the time that the facility producing
3            the renewable energy credits is interconnected at
4            the distribution system level of the utility and
5            verified as energized and in compliance by the
6            Program Administrator. The electric utility shall
7            receive and retire all renewable energy credits
8            generated by the project for the first 15 years of
9            operation. Renewable energy credits generated by
10            the project thereafter shall not be transferred
11            under the renewable energy credit delivery
12            contract with the counterparty electric utility.
13                (2) The Agency shall open the first block of
14            annual capacity for the category described in item
15            (ii) of subparagraph (K) of this paragraph (1).
16            The first block of annual capacity for item (ii)
17            shall be for at least 75 megawatts of total
18            nameplate capacity.
19                    (A) The price of the renewable energy
20                credit for any project on a waitlist for this
21                category before the opening of this block
22                shall be 4% less than the price of the last
23                open block in this category. Projects on the
24                waitlist shall be awarded contracts first in
25                the order in which they appear on the
26                waitlist. Any projects that are less than or

 

 

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1                equal to 25 kilowatts in size on the waitlist
2                for this capacity shall be moved to the
3                waitlist for paragraph (1) of this item (iv).
4                Notwithstanding anything to the contrary,
5                projects that were on the waitlist prior to
6                opening of this block shall not be required to
7                be in compliance with the requirements of
8                subparagraph (Q) of this paragraph (1) of this
9                subsection (c). Notwithstanding anything to
10                the contrary, for those renewable energy
11                credits procured from projects that were on
12                the waitlist for this category before the
13                opening of this block 20% of the renewable
14                energy credit delivery contract value, based
15                on the estimated generation during the first
16                15 years of operation, shall be paid by the
17                contracting utilities at the time that the
18                facility producing the renewable energy
19                credits is interconnected at the distribution
20                system level of the utility and verified as
21                energized by the Program Administrator. The
22                remaining portion shall be paid ratably over
23                the subsequent 4-year period. The electric
24                utility shall receive and retire all renewable
25                energy credits generated by the project during
26                the first 15 years of operation. Renewable

 

 

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1                energy credits generated by the project
2                thereafter shall not be transferred under the
3                renewable energy credit delivery contract with
4                the counterparty electric utility.
5                    (B) The price of renewable energy credits
6                for any project not on the waitlist for this
7                category before the opening of the block shall
8                be determined and published by the Agency.
9                Projects not on a waitlist as of the opening
10                of this block shall be subject to the
11                requirements of subparagraph (Q) of this
12                paragraph (1), as applicable. Projects not on
13                a waitlist as of the opening of this block
14                shall be subject to the contract provisions
15                outlined in item (iii) of subparagraph (L) of
16                this paragraph (1). The Agency shall strive to
17                publish updated prices and an updated
18                renewable energy credit delivery contract as
19                quickly as possible.
20                (3) For opening the first 2 blocks of annual
21            capacity for projects participating in item (iii)
22            of subparagraph (K) of paragraph (1) of subsection
23            (c), projects shall be selected exclusively from
24            those projects on the ordinal waitlists of
25            community renewable generation projects
26            established by the Agency based on the status of

 

 

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1            those ordinal waitlists as of December 31, 2020,
2            and only those projects previously determined to
3            be eligible for the Agency's April 2019 community
4            solar project selection process.
5                The first 2 blocks of annual capacity for item
6            (iii) shall be for 250 megawatts of total
7            nameplate capacity, with both blocks opening
8            simultaneously under the schedule outlined in the
9            paragraphs below. Projects shall be selected as
10            follows:
11                    (A) The geographic balance of selected
12                projects shall follow the Group classification
13                found in the Agency's Revised Long-Term
14                Renewable Resources Procurement Plan, with 70%
15                of capacity allocated to projects on the Group
16                B waitlist and 30% of capacity allocated to
17                projects on the Group A waitlist.
18                    (B) Contract awards for waitlisted
19                projects shall be allocated proportionate to
20                the total nameplate capacity amount across
21                both ordinal waitlists associated with that
22                applicant firm or its affiliates, subject to
23                the following conditions.
24                        (i) Each applicant firm having a
25                    waitlisted project eligible for selection
26                    shall receive no less than 500 kilowatts

 

 

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1                    in awarded capacity across all groups, and
2                    no approved vendor may receive more than
3                    20% of each Group's waitlist allocation.
4                        (ii) Each applicant firm, upon
5                    receiving an award of program capacity
6                    proportionate to its waitlisted capacity,
7                    may then determine which waitlisted
8                    projects it chooses to be selected for a
9                    contract award up to that capacity amount.
10                        (iii) Assuming all other program
11                    requirements are met, applicant firms may
12                    adjust the nameplate capacity of applicant
13                    projects without losing waitlist
14                    eligibility, so long as no project is
15                    greater than 2,000 kilowatts in size.
16                        (iv) Assuming all other program
17                    requirements are met, applicant firms may
18                    adjust the expected production associated
19                    with applicant projects, subject to
20                    verification by the Program Administrator.
21                    (C) After a review of affiliate
22                information and the current ordinal waitlists,
23                the Agency shall announce the nameplate
24                capacity award amounts associated with
25                applicant firms no later than 90 days after
26                the effective date of this amendatory Act of

 

 

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1                the 102nd General Assembly.
2                    (D) Applicant firms shall submit their
3                portfolio of projects used to satisfy those
4                contract awards no less than 90 days after the
5                Agency's announcement. The total nameplate
6                capacity of all projects used to satisfy that
7                portfolio shall be no greater than the
8                Agency's nameplate capacity award amount
9                associated with that applicant firm. An
10                applicant firm may decline, in whole or in
11                part, its nameplate capacity award without
12                penalty, with such unmet capacity rolled over
13                to the next block opening for project
14                selection under item (iii) of subparagraph (K)
15                of this subsection (c). Any projects not
16                included in an applicant firm's portfolio may
17                reapply without prejudice upon the next block
18                reopening for project selection under item
19                (iii) of subparagraph (K) of this subsection
20                (c).
21                    (E) The renewable energy credit delivery
22                contract shall be subject to the contract and
23                payment terms outlined in item (iv) of
24                subparagraph (L) of this subsection (c).
25                Contract instruments used for this
26                subparagraph shall contain the following

 

 

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1                terms:
2                        (i) Renewable energy credit prices
3                    shall be fixed, without further adjustment
4                    under any other provision of this Act or
5                    for any other reason, at 10% lower than
6                    prices applicable to the last open block
7                    for this category, inclusive of any adders
8                    available for achieving a minimum of 50%
9                    of subscribers to the project's nameplate
10                    capacity being residential or small
11                    commercial customers with subscriptions of
12                    below 25 kilowatts in size;
13                        (ii) A requirement that a minimum of
14                    50% of subscribers to the project's
15                    nameplate capacity be residential or small
16                    commercial customers with subscriptions of
17                    below 25 kilowatts in size;
18                        (iii) Permission for the ability of a
19                    contract holder to substitute projects
20                    with other waitlisted projects without
21                    penalty should a project receive a
22                    non-binding estimate of costs to construct
23                    the interconnection facilities and any
24                    required distribution upgrades associated
25                    with that project of greater than 30 cents
26                    per watt AC of that project's nameplate

 

 

HB2563- 28 -LRB103 29504 AMQ 55899 b

1                    capacity. In developing the applicable
2                    contract instrument, the Agency may
3                    consider whether other circumstances
4                    outside of the control of the applicant
5                    firm should also warrant project
6                    substitution rights.
7                    The Agency shall publish a finalized
8                updated renewable energy credit delivery
9                contract developed consistent with these terms
10                and conditions no less than 30 days before
11                applicant firms must submit their portfolio of
12                projects pursuant to item (D).
13                    (F) To be eligible for an award, the
14                applicant firm shall certify that not less
15                than prevailing wage, as determined pursuant
16                to the Illinois Prevailing Wage Act, was or
17                will be paid to employees who are engaged in
18                construction activities associated with a
19                selected project.
20                (4) The Agency shall open the first block of
21            annual capacity for the category described in item
22            (iv) of subparagraph (K) of this paragraph (1).
23            The first block of annual capacity for item (iv)
24            shall be for at least 50 megawatts of total
25            nameplate capacity. Renewable energy credit prices
26            shall be fixed, without further adjustment under

 

 

HB2563- 29 -LRB103 29504 AMQ 55899 b

1            any other provision of this Act or for any other
2            reason, at the price in the last open block in the
3            category described in item (ii) of subparagraph
4            (K) of this paragraph (1). Pricing for future
5            blocks of annual capacity for this category may be
6            adjusted in the Agency's second revision to its
7            Long-Term Renewable Resources Procurement Plan.
8            Projects in this category shall be subject to the
9            contract terms outlined in item (iv) of
10            subparagraph (L) of this paragraph (1).
11                (5) The Agency shall open the equivalent of 2
12            years of annual capacity for the category
13            described in item (v) of subparagraph (K) of this
14            paragraph (1). The first block of annual capacity
15            for item (v) shall be for at least 10 megawatts of
16            total nameplate capacity. Notwithstanding the
17            provisions of item (v) of subparagraph (K) of this
18            paragraph (1), for the purpose of this initial
19            block, the agency shall accept new project
20            applications intended to increase the diversity of
21            areas hosting community solar projects, the
22            business models of projects, and the size of
23            projects, as described by the Agency in its
24            long-term renewable resources procurement plan
25            that is approved as of the effective date of this
26            amendatory Act of the 102nd General Assembly.

 

 

HB2563- 30 -LRB103 29504 AMQ 55899 b

1            Projects in this category shall be subject to the
2            contract terms outlined in item (iii) of
3            subsection (L) of this paragraph (1).
4                (6) The Agency shall open the first blocks of
5            annual capacity for the category described in item
6            (vi) of subparagraph (K) of this paragraph (1),
7            with allocations of capacity within the block
8            generally matching the historical share of block
9            capacity allocated between the category described
10            in items (i) and (ii) of subparagraph (K) of this
11            paragraph (1). The first two blocks of annual
12            capacity for item (vi) shall be for at least 75
13            megawatts of total nameplate capacity. The price
14            of renewable energy credits for the blocks of
15            capacity shall be 4% less than the price of the
16            last open blocks in the categories described in
17            items (i) and (ii) of subparagraph (K) of this
18            paragraph (1). Pricing for future blocks of annual
19            capacity for this category may be adjusted in the
20            Agency's second revision to its Long-Term
21            Renewable Resources Procurement Plan. Projects in
22            this category shall be subject to the applicable
23            contract terms outlined in items (ii) and (iii) of
24            subparagraph (L) of this paragraph (1).
25            (v) Upon the effective date of this amendatory Act
26        of the 102nd General Assembly, for all competitive

 

 

HB2563- 31 -LRB103 29504 AMQ 55899 b

1        procurements and any procurements of renewable energy
2        credit from new utility-scale wind and new
3        utility-scale photovoltaic projects, the Agency shall
4        procure indexed renewable energy credits and direct
5        respondents to offer a strike price.
6                (1) The purchase price of the indexed
7            renewable energy credit payment shall be
8            calculated for each settlement period. That
9            payment, for any settlement period, shall be equal
10            to the difference resulting from subtracting the
11            strike price from the index price for that
12            settlement period. If this difference results in a
13            negative number, the indexed REC counterparty
14            shall owe the seller the absolute value multiplied
15            by the quantity of energy produced in the relevant
16            settlement period. If this difference results in a
17            positive number, the seller shall owe the indexed
18            REC counterparty this amount multiplied by the
19            quantity of energy produced in the relevant
20            settlement period.
21                (2) Parties shall cash settle every month,
22            summing up all settlements (both positive and
23            negative, if applicable) for the prior month.
24                (3) To ensure funding in the annual budget
25            established under subparagraph (E) for indexed
26            renewable energy credit procurements for each year

 

 

HB2563- 32 -LRB103 29504 AMQ 55899 b

1            of the term of such contracts, which must have a
2            minimum tenure of 20 calendar years, the
3            procurement administrator, Agency, Commission
4            staff, and procurement monitor shall quantify the
5            annual cost of the contract by utilizing an
6            industry-standard, third-party forward price curve
7            for energy at the appropriate hub or load zone,
8            including the estimated magnitude and timing of
9            the price effects related to federal carbon
10            controls. Each forward price curve shall contain a
11            specific value of the forecasted market price of
12            electricity for each annual delivery year of the
13            contract. For procurement planning purposes, the
14            impact on the annual budget for the cost of
15            indexed renewable energy credits for each delivery
16            year shall be determined as the expected annual
17            contract expenditure for that year, equaling the
18            difference between (i) the sum across all relevant
19            contracts of the applicable strike price
20            multiplied by contract quantity and (ii) the sum
21            across all relevant contracts of the forward price
22            curve for the applicable load zone for that year
23            multiplied by contract quantity. The contracting
24            utility shall not assume an obligation in excess
25            of the estimated annual cost of the contracts for
26            indexed renewable energy credits. Forward curves

 

 

HB2563- 33 -LRB103 29504 AMQ 55899 b

1            shall be revised on an annual basis as updated
2            forward price curves are released and filed with
3            the Commission in the proceeding approving the
4            Agency's most recent long-term renewable resources
5            procurement plan. If the expected contract spend
6            is higher or lower than the total quantity of
7            contracts multiplied by the forward price curve
8            value for that year, the forward price curve shall
9            be updated by the procurement administrator, in
10            consultation with the Agency, Commission staff,
11            and procurement monitors, using then-currently
12            available price forecast data and additional
13            budget dollars shall be obligated or reobligated
14            as appropriate.
15                (4) To ensure that indexed renewable energy
16            credit prices remain predictable and affordable,
17            the Agency may consider the institution of a price
18            collar on REC prices paid under indexed renewable
19            energy credit procurements establishing floor and
20            ceiling REC prices applicable to indexed REC
21            contract prices. Any price collars applicable to
22            indexed REC procurements shall be proposed by the
23            Agency through its long-term renewable resources
24            procurement plan.
25            (vi) All procurements under this subparagraph (G)
26        shall comply with the geographic requirements in

 

 

HB2563- 34 -LRB103 29504 AMQ 55899 b

1        subparagraph (I) of this paragraph (1) and shall
2        follow the procurement processes and procedures
3        described in this Section and Section 16-111.5 of the
4        Public Utilities Act to the extent practicable, and
5        these processes and procedures may be expedited to
6        accommodate the schedule established by this
7        subparagraph (G).
8        (H) The procurement of renewable energy resources for
9    a given delivery year shall be reduced as described in
10    this subparagraph (H) if an alternative retail electric
11    supplier meets the requirements described in this
12    subparagraph (H).
13            (i) Within 45 days after June 1, 2017 (the
14        effective date of Public Act 99-906), an alternative
15        retail electric supplier or its successor shall submit
16        an informational filing to the Illinois Commerce
17        Commission certifying that, as of December 31, 2015,
18        the alternative retail electric supplier owned one or
19        more electric generating facilities that generates
20        renewable energy resources as defined in Section 1-10
21        of this Act, provided that such facilities are not
22        powered by wind or photovoltaics, and the facilities
23        generate one renewable energy credit for each
24        megawatthour of energy produced from the facility.
25            The informational filing shall identify each
26        facility that was eligible to satisfy the alternative

 

 

HB2563- 35 -LRB103 29504 AMQ 55899 b

1        retail electric supplier's obligations under Section
2        16-115D of the Public Utilities Act as described in
3        this item (i).
4            (ii) For a given delivery year, the alternative
5        retail electric supplier may elect to supply its
6        retail customers with renewable energy credits from
7        the facility or facilities described in item (i) of
8        this subparagraph (H) that continue to be owned by the
9        alternative retail electric supplier.
10            (iii) The alternative retail electric supplier
11        shall notify the Agency and the applicable utility, no
12        later than February 28 of the year preceding the
13        applicable delivery year or 15 days after June 1, 2017
14        (the effective date of Public Act 99-906), whichever
15        is later, of its election under item (ii) of this
16        subparagraph (H) to supply renewable energy credits to
17        retail customers of the utility. Such election shall
18        identify the amount of renewable energy credits to be
19        supplied by the alternative retail electric supplier
20        to the utility's retail customers and the source of
21        the renewable energy credits identified in the
22        informational filing as described in item (i) of this
23        subparagraph (H), subject to the following
24        limitations:
25                For the delivery year beginning June 1, 2018,
26            the maximum amount of renewable energy credits to

 

 

HB2563- 36 -LRB103 29504 AMQ 55899 b

1            be supplied by an alternative retail electric
2            supplier under this subparagraph (H) shall be 68%
3            multiplied by 25% multiplied by 14.5% multiplied
4            by the amount of metered electricity
5            (megawatt-hours) delivered by the alternative
6            retail electric supplier to Illinois retail
7            customers during the delivery year ending May 31,
8            2016.
9                For delivery years beginning June 1, 2019 and
10            each year thereafter, the maximum amount of
11            renewable energy credits to be supplied by an
12            alternative retail electric supplier under this
13            subparagraph (H) shall be 68% multiplied by 50%
14            multiplied by 16% multiplied by the amount of
15            metered electricity (megawatt-hours) delivered by
16            the alternative retail electric supplier to
17            Illinois retail customers during the delivery year
18            ending May 31, 2016, provided that the 16% value
19            shall increase by 1.5% each delivery year
20            thereafter to 25% by the delivery year beginning
21            June 1, 2025, and thereafter the 25% value shall
22            apply to each delivery year.
23            For each delivery year, the total amount of
24        renewable energy credits supplied by all alternative
25        retail electric suppliers under this subparagraph (H)
26        shall not exceed 9% of the Illinois target renewable

 

 

HB2563- 37 -LRB103 29504 AMQ 55899 b

1        energy credit quantity. The Illinois target renewable
2        energy credit quantity for the delivery year beginning
3        June 1, 2018 is 14.5% multiplied by the total amount of
4        metered electricity (megawatt-hours) delivered in the
5        delivery year immediately preceding that delivery
6        year, provided that the 14.5% shall increase by 1.5%
7        each delivery year thereafter to 25% by the delivery
8        year beginning June 1, 2025, and thereafter the 25%
9        value shall apply to each delivery year.
10            If the requirements set forth in items (i) through
11        (iii) of this subparagraph (H) are met, the charges
12        that would otherwise be applicable to the retail
13        customers of the alternative retail electric supplier
14        under paragraph (6) of this subsection (c) for the
15        applicable delivery year shall be reduced by the ratio
16        of the quantity of renewable energy credits supplied
17        by the alternative retail electric supplier compared
18        to that supplier's target renewable energy credit
19        quantity. The supplier's target renewable energy
20        credit quantity for the delivery year beginning June
21        1, 2018 is 14.5% multiplied by the total amount of
22        metered electricity (megawatt-hours) delivered by the
23        alternative retail supplier in that delivery year,
24        provided that the 14.5% shall increase by 1.5% each
25        delivery year thereafter to 25% by the delivery year
26        beginning June 1, 2025, and thereafter the 25% value

 

 

HB2563- 38 -LRB103 29504 AMQ 55899 b

1        shall apply to each delivery year.
2            On or before April 1 of each year, the Agency shall
3        annually publish a report on its website that
4        identifies the aggregate amount of renewable energy
5        credits supplied by alternative retail electric
6        suppliers under this subparagraph (H).
7        (I) The Agency shall design its long-term renewable
8    energy procurement plan to maximize the State's interest
9    in the health, safety, and welfare of its residents,
10    including but not limited to minimizing sulfur dioxide,
11    nitrogen oxide, particulate matter and other pollution
12    that adversely affects public health in this State,
13    increasing fuel and resource diversity in this State,
14    enhancing the reliability and resiliency of the
15    electricity distribution system in this State, meeting
16    goals to limit carbon dioxide emissions under federal or
17    State law, and contributing to a cleaner and healthier
18    environment for the citizens of this State. In order to
19    further these legislative purposes, renewable energy
20    credits shall be eligible to be counted toward the
21    renewable energy requirements of this subsection (c) if
22    they are generated from facilities located in this State.
23    The Agency may qualify renewable energy credits from
24    facilities located in states adjacent to Illinois or
25    renewable energy credits associated with the electricity
26    generated by a utility-scale wind energy facility or

 

 

HB2563- 39 -LRB103 29504 AMQ 55899 b

1    utility-scale photovoltaic facility and transmitted by a
2    qualifying direct current project described in subsection
3    (b-5) of Section 8-406 of the Public Utilities Act to a
4    delivery point on the electric transmission grid located
5    in this State or a state adjacent to Illinois, if the
6    generator demonstrates and the Agency determines that the
7    operation of such facility or facilities will help promote
8    the State's interest in the health, safety, and welfare of
9    its residents based on the public interest criteria
10    described above. For the purposes of this Section,
11    renewable resources that are delivered via a high voltage
12    direct current converter station located in Illinois shall
13    be deemed generated in Illinois at the time and location
14    the energy is converted to alternating current by the high
15    voltage direct current converter station if the high
16    voltage direct current transmission line: (i) after the
17    effective date of this amendatory Act of the 102nd General
18    Assembly, was constructed with a project labor agreement;
19    (ii) is capable of transmitting electricity at 525kv;
20    (iii) has an Illinois converter station located and
21    interconnected in the region of the PJM Interconnection,
22    LLC; (iv) does not operate as a public utility; and (v) if
23    the high voltage direct current transmission line was
24    energized after June 1, 2023. To ensure that the public
25    interest criteria are applied to the procurement and given
26    full effect, the Agency's long-term procurement plan shall

 

 

HB2563- 40 -LRB103 29504 AMQ 55899 b

1    describe in detail how each public interest factor shall
2    be considered and weighted for facilities located in
3    states adjacent to Illinois.
4        (J) In order to promote the competitive development of
5    renewable energy resources in furtherance of the State's
6    interest in the health, safety, and welfare of its
7    residents, renewable energy credits shall not be eligible
8    to be counted toward the renewable energy requirements of
9    this subsection (c) if they are sourced from a generating
10    unit whose costs were being recovered through rates
11    regulated by this State or any other state or states on or
12    after January 1, 2017. Each contract executed to purchase
13    renewable energy credits under this subsection (c) shall
14    provide for the contract's termination if the costs of the
15    generating unit supplying the renewable energy credits
16    subsequently begin to be recovered through rates regulated
17    by this State or any other state or states; and each
18    contract shall further provide that, in that event, the
19    supplier of the credits must return 110% of all payments
20    received under the contract. Amounts returned under the
21    requirements of this subparagraph (J) shall be retained by
22    the utility and all of these amounts shall be used for the
23    procurement of additional renewable energy credits from
24    new wind or new photovoltaic resources as defined in this
25    subsection (c). The long-term plan shall provide that
26    these renewable energy credits shall be procured in the

 

 

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1    next procurement event.
2        Notwithstanding the limitations of this subparagraph
3    (J), renewable energy credits sourced from generating
4    units that are constructed, purchased, owned, or leased by
5    an electric utility as part of an approved project,
6    program, or pilot under Section 1-56 of this Act shall be
7    eligible to be counted toward the renewable energy
8    requirements of this subsection (c), regardless of how the
9    costs of these units are recovered. As long as a
10    generating unit or an identifiable portion of a generating
11    unit has not had and does not have its costs recovered
12    through rates regulated by this State or any other state,
13    HVDC renewable energy credits associated with that
14    generating unit or identifiable portion thereof shall be
15    eligible to be counted toward the renewable energy
16    requirements of this subsection (c).
17        (K) The long-term renewable resources procurement plan
18    developed by the Agency in accordance with subparagraph
19    (A) of this paragraph (1) shall include an Adjustable
20    Block program for the procurement of renewable energy
21    credits from new photovoltaic projects that are
22    distributed renewable energy generation devices or new
23    photovoltaic community renewable generation projects. The
24    Adjustable Block program shall be generally designed to
25    provide for the steady, predictable, and sustainable
26    growth of new solar photovoltaic development in Illinois.

 

 

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1    To this end, the Adjustable Block program shall provide a
2    transparent annual schedule of prices and quantities to
3    enable the photovoltaic market to scale up and for
4    renewable energy credit prices to adjust at a predictable
5    rate over time. The prices set by the Adjustable Block
6    program can be reflected as a set value or as the product
7    of a formula.
8        The Adjustable Block program shall include for each
9    category of eligible projects for each delivery year: a
10    single block of nameplate capacity, a price for renewable
11    energy credits within that block, and the terms and
12    conditions for securing a spot on a waitlist once the
13    block is fully committed or reserved. Except as outlined
14    below, the waitlist of projects in a given year will carry
15    over to apply to the subsequent year when another block is
16    opened. Only projects energized on or after June 1, 2017
17    shall be eligible for the Adjustable Block program. For
18    each category for each delivery year the Agency shall
19    determine the amount of generation capacity in each block,
20    and the purchase price for each block, provided that the
21    purchase price provided and the total amount of generation
22    in all blocks for all categories shall be sufficient to
23    meet the goals in this subsection (c). The Agency shall
24    strive to issue a single block sized to provide for
25    stability and market growth. The Agency shall establish
26    program eligibility requirements that ensure that projects

 

 

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1    that enter the program are sufficiently mature to indicate
2    a demonstrable path to completion. The Agency may
3    periodically review its prior decisions establishing the
4    amount of generation capacity in each block, and the
5    purchase price for each block, and may propose, on an
6    expedited basis, changes to these previously set values,
7    including but not limited to redistributing these amounts
8    and the available funds as necessary and appropriate,
9    subject to Commission approval as part of the periodic
10    plan revision process described in Section 16-111.5 of the
11    Public Utilities Act. The Agency may define different
12    block sizes, purchase prices, or other distinct terms and
13    conditions for projects located in different utility
14    service territories if the Agency deems it necessary to
15    meet the goals in this subsection (c).
16        The Adjustable Block program shall include the
17    following categories in at least the following amounts:
18            (i) At least 20% from distributed renewable energy
19        generation devices with a nameplate capacity of no
20        more than 25 kilowatts.
21            (ii) At least 20% from distributed renewable
22        energy generation devices with a nameplate capacity of
23        more than 25 kilowatts and no more than 5,000
24        kilowatts. The Agency may create sub-categories within
25        this category to account for the differences between
26        projects for small commercial customers, large

 

 

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1        commercial customers, and public or non-profit
2        customers.
3            (iii) At least 30% from photovoltaic community
4        renewable generation projects. Capacity for this
5        category for the first 2 delivery years after the
6        effective date of this amendatory Act of the 102nd
7        General Assembly shall be allocated to waitlist
8        projects as provided in paragraph (3) of item (iv) of
9        subparagraph (G). Starting in the third delivery year
10        after the effective date of this amendatory Act of the
11        102nd General Assembly or earlier if the Agency
12        determines there is additional capacity needed for to
13        meet previous delivery year requirements, the
14        following shall apply:
15                (1) the Agency shall select projects on a
16            first-come, first-serve basis, however the Agency
17            may suggest additional methods to prioritize
18            projects that are submitted at the same time;
19                (2) projects shall have subscriptions of 25 kW
20            or less for at least 50% of the facility's
21            nameplate capacity and the Agency shall price the
22            renewable energy credits with that as a factor;
23                (3) projects shall not be colocated with one
24            or more other community renewable generation
25            projects, as defined in the Agency's first revised
26            long-term renewable resources procurement plan

 

 

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1            approved by the Commission on February 18, 2020,
2            such that the aggregate nameplate capacity exceeds
3            5,000 kilowatts; and
4                (4) projects greater than 2 MW may not apply
5            until after the approval of the Agency's revised
6            Long-Term Renewable Resources Procurement Plan
7            after the effective date of this amendatory Act of
8            the 102nd General Assembly.
9            (iv) At least 15% from distributed renewable
10        generation devices or photovoltaic community renewable
11        generation projects installed at public schools. The
12        Agency may create subcategories within this category
13        to account for the differences between project size or
14        location. Projects located within environmental
15        justice communities or within Organizational Units
16        that fall within Tier 1 or Tier 2 shall be given
17        priority. Each of the Agency's periodic updates to its
18        long-term renewable resources procurement plan to
19        incorporate the procurement described in this
20        subparagraph (iv) shall also include the proposed
21        quantities or blocks, pricing, and contract terms
22        applicable to the procurement as indicated herein. In
23        each such update and procurement, the Agency shall set
24        the renewable energy credit price and establish
25        payment terms for the renewable energy credits
26        procured pursuant to this subparagraph (iv) that make

 

 

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1        it feasible and affordable for public schools to
2        install photovoltaic distributed renewable energy
3        devices on their premises, including, but not limited
4        to, those public schools subject to the prioritization
5        provisions of this subparagraph. For the purposes of
6        this item (iv):
7            "Environmental Justice Community" shall have the
8        same meaning set forth in the Agency's long-term
9        renewable resources procurement plan;
10            "Organization Unit", "Tier 1" and "Tier 2" shall
11        have the meanings set for in Section 18-8.15 of the
12        School Code;
13            "Public schools" shall have the meaning set forth
14        in Section 1-3 of the School Code.
15            (v) At least 5% from community-driven community
16        solar projects intended to provide more direct and
17        tangible connection and benefits to the communities
18        which they serve or in which they operate and,
19        additionally, to increase the variety of community
20        solar locations, models, and options in Illinois. As
21        part of its long-term renewable resources procurement
22        plan, the Agency shall develop selection criteria for
23        projects participating in this category. Nothing in
24        this Section shall preclude the Agency from creating a
25        selection process that maximizes community ownership
26        and community benefits in selecting projects to

 

 

HB2563- 47 -LRB103 29504 AMQ 55899 b

1        receive renewable energy credits. Selection criteria
2        shall include:
3                (1) community ownership or community
4            wealth-building;
5                (2) additional direct and indirect community
6            benefit, beyond project participation as a
7            subscriber, including, but not limited to,
8            economic, environmental, social, cultural, and
9            physical benefits;
10                (3) meaningful involvement in project
11            organization and development by community members
12            or nonprofit organizations or public entities
13            located in or serving the community;
14                (4) engagement in project operations and
15            management by nonprofit organizations, public
16            entities, or community members; and
17                (5) whether a project is developed in response
18            to a site-specific RFP developed by community
19            members or a nonprofit organization or public
20            entity located in or serving the community.
21            Selection criteria may also prioritize projects
22        that:
23                (1) are developed in collaboration with or to
24            provide complementary opportunities for the Clean
25            Jobs Workforce Network Program, the Illinois
26            Climate Works Preapprenticeship Program, the

 

 

HB2563- 48 -LRB103 29504 AMQ 55899 b

1            Returning Residents Clean Jobs Training Program,
2            the Clean Energy Contractor Incubator Program, or
3            the Clean Energy Primes Contractor Accelerator
4            Program;
5                (2) increase the diversity of locations of
6            community solar projects in Illinois, including by
7            locating in urban areas and population centers;
8                (3) are located in Equity Investment Eligible
9            Communities;
10                (4) are not greenfield projects;
11                (5) serve only local subscribers;
12                (6) have a nameplate capacity that does not
13            exceed 500 kW;
14                (7) are developed by an equity eligible
15            contractor; or
16                (8) otherwise meaningfully advance the goals
17            of providing more direct and tangible connection
18            and benefits to the communities which they serve
19            or in which they operate and increasing the
20            variety of community solar locations, models, and
21            options in Illinois.
22            For the purposes of this item (v):
23            "Community" means a social unit in which people
24        come together regularly to effect change; a social
25        unit in which participants are marked by a cooperative
26        spirit, a common purpose, or shared interests or

 

 

HB2563- 49 -LRB103 29504 AMQ 55899 b

1        characteristics; or a space understood by its
2        residents to be delineated through geographic
3        boundaries or landmarks.
4            "Community benefit" means a range of services and
5        activities that provide affirmative, economic,
6        environmental, social, cultural, or physical value to
7        a community; or a mechanism that enables economic
8        development, high-quality employment, and education
9        opportunities for local workers and residents, or
10        formal monitoring and oversight structures such that
11        community members may ensure that those services and
12        activities respond to local knowledge and needs.
13            "Community ownership" means an arrangement in
14        which an electric generating facility is, or over time
15        will be, in significant part, owned collectively by
16        members of the community to which an electric
17        generating facility provides benefits; members of that
18        community participate in decisions regarding the
19        governance, operation, maintenance, and upgrades of
20        and to that facility; and members of that community
21        benefit from regular use of that facility.
22            Terms and guidance within these criteria that are
23        not defined in this item (v) shall be defined by the
24        Agency, with stakeholder input, during the development
25        of the Agency's long-term renewable resources
26        procurement plan. The Agency shall develop regular

 

 

HB2563- 50 -LRB103 29504 AMQ 55899 b

1        opportunities for projects to submit applications for
2        projects under this category, and develop selection
3        criteria that gives preference to projects that better
4        meet individual criteria as well as projects that
5        address a higher number of criteria.
6            (vi) At least 10% from distributed renewable
7        energy generation devices, which includes distributed
8        renewable energy devices with a nameplate capacity
9        under 5,000 kilowatts or photovoltaic community
10        renewable generation projects, from applicants that
11        are equity eligible contractors. The Agency may create
12        subcategories within this category to account for the
13        differences between project size and type. The Agency
14        shall propose to increase the percentage in this item
15        (vi) over time to 40% based on factors, including, but
16        not limited to, the number of equity eligible
17        contractors and capacity used in this item (vi) in
18        previous delivery years.
19            The Agency shall propose a payment structure for
20        contracts executed pursuant to this paragraph under
21        which, upon a demonstration of qualification or need,
22        applicant firms are advanced capital disbursed after
23        contract execution but before the contracted project's
24        energization. The amount or percentage of capital
25        advanced prior to project energization shall be
26        sufficient to both cover any increase in development

 

 

HB2563- 51 -LRB103 29504 AMQ 55899 b

1        costs resulting from prevailing wage requirements or
2        project-labor agreements, and designed to overcome
3        barriers in access to capital faced by equity eligible
4        contractors. The amount or percentage of advanced
5        capital may vary by subcategory within this category
6        and by an applicant's demonstration of need, with such
7        levels to be established through the Long-Term
8        Renewable Resources Procurement Plan authorized under
9        subparagraph (A) of paragraph (1) of subsection (c) of
10        this Section.
11            Contracts developed featuring capital advanced
12        prior to a project's energization shall feature
13        provisions to ensure both the successful development
14        of applicant projects and the delivery of the
15        renewable energy credits for the full term of the
16        contract, including ongoing collateral requirements
17        and other provisions deemed necessary by the Agency,
18        and may include energization timelines longer than for
19        comparable project types. The percentage or amount of
20        capital advanced prior to project energization shall
21        not operate to increase the overall contract value,
22        however contracts executed under this subparagraph may
23        feature renewable energy credit prices higher than
24        those offered to similar projects participating in
25        other categories. Capital advanced prior to
26        energization shall serve to reduce the ratable

 

 

HB2563- 52 -LRB103 29504 AMQ 55899 b

1        payments made after energization under items (ii) and
2        (iii) of subparagraph (L) or payments made for each
3        renewable energy credit delivery under item (iv) of
4        subparagraph (L).
5            (vii) The remaining capacity shall be allocated by
6        the Agency in order to respond to market demand. The
7        Agency shall allocate any discretionary capacity prior
8        to the beginning of each delivery year.
9        To the extent there is uncontracted capacity from any
10    block in any of categories (i) through (vi) at the end of a
11    delivery year, the Agency shall redistribute that capacity
12    to one or more other categories giving priority to
13    categories with projects on a waitlist. The redistributed
14    capacity shall be added to the annual capacity in the
15    subsequent delivery year, and the price for renewable
16    energy credits shall be the price for the new delivery
17    year. Redistributed capacity shall not be considered
18    redistributed when determining whether the goals in this
19    subsection (K) have been met.
20        Notwithstanding anything to the contrary, as the
21    Agency increases the capacity in item (vi) to 40% over
22    time, the Agency may reduce the capacity of items (i)
23    through (v) proportionate to the capacity of the
24    categories of projects in item (vi), to achieve a balance
25    of project types.
26        The Adjustable Block program shall be designed to

 

 

HB2563- 53 -LRB103 29504 AMQ 55899 b

1    ensure that renewable energy credits are procured from
2    projects in diverse locations and are not concentrated in
3    a few regional areas.
4        (L) Notwithstanding provisions for advancing capital
5    prior to project energization found in item (vi) of
6    subparagraph (K), the procurement of photovoltaic
7    renewable energy credits under items (i) through (vi) of
8    subparagraph (K) of this paragraph (1) shall otherwise be
9    subject to the following contract and payment terms:
10        (i) (Blank).
11            (ii) For those renewable energy credits that
12        qualify and are procured under item (i) of
13        subparagraph (K) of this paragraph (1), and any
14        similar category projects that are procured under item
15        (vi) of subparagraph (K) of this paragraph (1) that
16        qualify and are procured under item (vi), the contract
17        length shall be 15 years. The renewable energy credit
18        delivery contract value shall be paid in full, based
19        on the estimated generation during the first 15 years
20        of operation, by the contracting utilities at the time
21        that the facility producing the renewable energy
22        credits is interconnected at the distribution system
23        level of the utility and verified as energized and
24        compliant by the Program Administrator. The electric
25        utility shall receive and retire all renewable energy
26        credits generated by the project for the first 15

 

 

HB2563- 54 -LRB103 29504 AMQ 55899 b

1        years of operation. Renewable energy credits generated
2        by the project thereafter shall not be transferred
3        under the renewable energy credit delivery contract
4        with the counterparty electric utility.
5            (iii) For those renewable energy credits that
6        qualify and are procured under item (ii) and (v) of
7        subparagraph (K) of this paragraph (1) and any like
8        projects similar category that qualify and are
9        procured under item (vi), the contract length shall be
10        15 years. 15% of the renewable energy credit delivery
11        contract value, based on the estimated generation
12        during the first 15 years of operation, shall be paid
13        by the contracting utilities at the time that the
14        facility producing the renewable energy credits is
15        interconnected at the distribution system level of the
16        utility and verified as energized and compliant by the
17        Program Administrator. The remaining portion shall be
18        paid ratably over the subsequent 6-year period. The
19        electric utility shall receive and retire all
20        renewable energy credits generated by the project for
21        the first 15 years of operation. Renewable energy
22        credits generated by the project thereafter shall not
23        be transferred under the renewable energy credit
24        delivery contract with the counterparty electric
25        utility.
26            (iv) For those renewable energy credits that

 

 

HB2563- 55 -LRB103 29504 AMQ 55899 b

1        qualify and are procured under items (iii) and (iv) of
2        subparagraph (K) of this paragraph (1), and any like
3        projects that qualify and are procured under item
4        (vi), the renewable energy credit delivery contract
5        length shall be 20 years and shall be paid over the
6        delivery term, not to exceed during each delivery year
7        the contract price multiplied by the estimated annual
8        renewable energy credit generation amount. If
9        generation of renewable energy credits during a
10        delivery year exceeds the estimated annual generation
11        amount, the excess renewable energy credits shall be
12        carried forward to future delivery years and shall not
13        expire during the delivery term. If generation of
14        renewable energy credits during a delivery year,
15        including carried forward excess renewable energy
16        credits, if any, is less than the estimated annual
17        generation amount, payments during such delivery year
18        will not exceed the quantity generated plus the
19        quantity carried forward multiplied by the contract
20        price. The electric utility shall receive all
21        renewable energy credits generated by the project
22        during the first 20 years of operation and retire all
23        renewable energy credits paid for under this item (iv)
24        and return at the end of the delivery term all
25        renewable energy credits that were not paid for.
26        Renewable energy credits generated by the project

 

 

HB2563- 56 -LRB103 29504 AMQ 55899 b

1        thereafter shall not be transferred under the
2        renewable energy credit delivery contract with the
3        counterparty electric utility. Notwithstanding the
4        preceding, for those projects participating under item
5        (iii) of subparagraph (K), the contract price for a
6        delivery year shall be based on subscription levels as
7        measured on the higher of the first business day of the
8        delivery year or the first business day 6 months after
9        the first business day of the delivery year.
10        Subscription of 90% of nameplate capacity or greater
11        shall be deemed to be fully subscribed for the
12        purposes of this item (iv). For projects receiving a
13        20-year delivery contract, REC prices shall be
14        adjusted downward for consistency with the incentive
15        levels previously determined to be necessary to
16        support projects under 15-year delivery contracts,
17        taking into consideration any additional new
18        requirements placed on the projects, including, but
19        not limited to, labor standards.
20            (v) Each contract shall include provisions to
21        ensure the delivery of the estimated quantity of
22        renewable energy credits and ongoing collateral
23        requirements and other provisions deemed appropriate
24        by the Agency.
25            (vi) The utility shall be the counterparty to the
26        contracts executed under this subparagraph (L) that

 

 

HB2563- 57 -LRB103 29504 AMQ 55899 b

1        are approved by the Commission under the process
2        described in Section 16-111.5 of the Public Utilities
3        Act. No contract shall be executed for an amount that
4        is less than one renewable energy credit per year.
5            (vii) If, at any time, approved applications for
6        the Adjustable Block program exceed funds collected by
7        the electric utility or would cause the Agency to
8        exceed the limitation described in subparagraph (E) of
9        this paragraph (1) on the amount of renewable energy
10        resources that may be procured, then the Agency may
11        consider future uncommitted funds to be reserved for
12        these contracts on a first-come, first-served basis.
13            (viii) Nothing in this Section shall require the
14        utility to advance any payment or pay any amounts that
15        exceed the actual amount of revenues anticipated to be
16        collected by the utility under paragraph (6) of this
17        subsection (c) and subsection (k) of Section 16-108 of
18        the Public Utilities Act inclusive of eligible funds
19        collected in prior years and alternative compliance
20        payments for use by the utility, and contracts
21        executed under this Section shall expressly
22        incorporate this limitation.
23            (ix) Notwithstanding other requirements of this
24        subparagraph (L), no modification shall be required to
25        Adjustable Block program contracts if they were
26        already executed prior to the establishment, approval,

 

 

HB2563- 58 -LRB103 29504 AMQ 55899 b

1        and implementation of new contract forms as a result
2        of this amendatory Act of the 102nd General Assembly.
3            (x) Contracts may be assignable, but only to
4        entities first deemed by the Agency to have met
5        program terms and requirements applicable to direct
6        program participation. In developing contracts for the
7        delivery of renewable energy credits, the Agency shall
8        be permitted to establish fees applicable to each
9        contract assignment.
10        (M) The Agency shall be authorized to retain one or
11    more experts or expert consulting firms to develop,
12    administer, implement, operate, and evaluate the
13    Adjustable Block program described in subparagraph (K) of
14    this paragraph (1), and the Agency shall retain the
15    consultant or consultants in the same manner, to the
16    extent practicable, as the Agency retains others to
17    administer provisions of this Act, including, but not
18    limited to, the procurement administrator. The selection
19    of experts and expert consulting firms and the procurement
20    process described in this subparagraph (M) are exempt from
21    the requirements of Section 20-10 of the Illinois
22    Procurement Code, under Section 20-10 of that Code. The
23    Agency shall strive to minimize administrative expenses in
24    the implementation of the Adjustable Block program.
25        The Program Administrator may charge application fees
26    to participating firms to cover the cost of program

 

 

HB2563- 59 -LRB103 29504 AMQ 55899 b

1    administration. Any application fee amounts shall
2    initially be determined through the long-term renewable
3    resources procurement plan, and modifications to any
4    application fee that deviate more than 25% from the
5    Commission's approved value must be approved by the
6    Commission as a long-term plan revision under Section
7    16-111.5 of the Public Utilities Act. The Agency shall
8    consider stakeholder feedback when making adjustments to
9    application fees and shall notify stakeholders in advance
10    of any planned changes.
11        In addition to covering the costs of program
12    administration, the Agency, in conjunction with its
13    Program Administrator, may also use the proceeds of such
14    fees charged to participating firms to support public
15    education and ongoing regional and national coordination
16    with nonprofit organizations, public bodies, and others
17    engaged in the implementation of renewable energy
18    incentive programs or similar initiatives. This work may
19    include developing papers and reports, hosting regional
20    and national conferences, and other work deemed necessary
21    by the Agency to position the State of Illinois as a
22    national leader in renewable energy incentive program
23    development and administration.
24        The Agency and its consultant or consultants shall
25    monitor block activity, share program activity with
26    stakeholders and conduct quarterly meetings to discuss

 

 

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1    program activity and market conditions. If necessary, the
2    Agency may make prospective administrative adjustments to
3    the Adjustable Block program design, such as making
4    adjustments to purchase prices as necessary to achieve the
5    goals of this subsection (c). Program modifications to any
6    block price that do not deviate from the Commission's
7    approved value by more than 10% shall take effect
8    immediately and are not subject to Commission review and
9    approval. Program modifications to any block price that
10    deviate more than 10% from the Commission's approved value
11    must be approved by the Commission as a long-term plan
12    amendment under Section 16-111.5 of the Public Utilities
13    Act. The Agency shall consider stakeholder feedback when
14    making adjustments to the Adjustable Block design and
15    shall notify stakeholders in advance of any planned
16    changes.
17        The Agency and its program administrators for both the
18    Adjustable Block program and the Illinois Solar for All
19    Program, consistent with the requirements of this
20    subsection (c) and subsection (b) of Section 1-56 of this
21    Act, shall propose the Adjustable Block program terms,
22    conditions, and requirements, including the prices to be
23    paid for renewable energy credits, where applicable, and
24    requirements applicable to participating entities and
25    project applications, through the development, review, and
26    approval of the Agency's long-term renewable resources

 

 

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1    procurement plan described in this subsection (c) and
2    paragraph (5) of subsection (b) of Section 16-111.5 of the
3    Public Utilities Act. Terms, conditions, and requirements
4    for program participation shall include the following:
5            (i) The Agency shall establish a registration
6        process for entities seeking to qualify for
7        program-administered incentive funding and establish
8        baseline qualifications for vendor approval. The
9        Agency must maintain a list of approved entities on
10        each program's website, and may revoke a vendor's
11        ability to receive program-administered incentive
12        funding status upon a determination that the vendor
13        failed to comply with contract terms, the law, or
14        other program requirements.
15            (ii) The Agency shall establish program
16        requirements and minimum contract terms to ensure
17        projects are properly installed and produce their
18        expected amounts of energy. Program requirements may
19        include on-site inspections and photo documentation of
20        projects under construction. The Agency may require
21        repairs, alterations, or additions to remedy any
22        material deficiencies discovered. Vendors who have a
23        disproportionately high number of deficient systems
24        may lose their eligibility to continue to receive
25        State-administered incentive funding through Agency
26        programs and procurements.

 

 

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1            (iii) To discourage deceptive marketing or other
2        bad faith business practices, the Agency may require
3        direct program participants, including agents
4        operating on their behalf, to provide standardized
5        disclosures to a customer prior to that customer's
6        execution of a contract for the development of a
7        distributed generation system or a subscription to a
8        community solar project.
9            (iv) The Agency shall establish one or multiple
10        Consumer Complaints Centers to accept complaints
11        regarding businesses that participate in, or otherwise
12        benefit from, State-administered incentive funding
13        through Agency-administered programs. The Agency shall
14        maintain a public database of complaints with any
15        confidential or particularly sensitive information
16        redacted from public entries.
17            (v) Through a filing in the proceeding for the
18        approval of its long-term renewable energy resources
19        procurement plan, the Agency shall provide an annual
20        written report to the Illinois Commerce Commission
21        documenting the frequency and nature of complaints and
22        any enforcement actions taken in response to those
23        complaints.
24            (vi) The Agency shall schedule regular meetings
25        with representatives of the Office of the Attorney
26        General, the Illinois Commerce Commission, consumer

 

 

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1        protection groups, and other interested stakeholders
2        to share relevant information about consumer
3        protection, project compliance, and complaints
4        received.
5            (vii) To the extent that complaints received
6        implicate the jurisdiction of the Office of the
7        Attorney General, the Illinois Commerce Commission, or
8        local, State, or federal law enforcement, the Agency
9        shall also refer complaints to those entities as
10        appropriate.
11        (N) The Agency shall establish the terms, conditions,
12    and program requirements for photovoltaic community
13    renewable generation projects with a goal to expand access
14    to a broader group of energy consumers, to ensure robust
15    participation opportunities for residential and small
16    commercial customers and those who cannot install
17    renewable energy on their own properties. Subject to
18    reasonable limitations, any plan approved by the
19    Commission shall allow subscriptions to community
20    renewable generation projects to be portable and
21    transferable. For purposes of this subparagraph (N),
22    "portable" means that subscriptions may be retained by the
23    subscriber even if the subscriber relocates or changes its
24    address within the same utility service territory; and
25    "transferable" means that a subscriber may assign or sell
26    subscriptions to another person within the same utility

 

 

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1    service territory.
2        Through the development of its long-term renewable
3    resources procurement plan, the Agency may consider
4    whether community renewable generation projects utilizing
5    technologies other than photovoltaics should be supported
6    through State-administered incentive funding, and may
7    issue requests for information to gauge market demand.
8        Electric utilities shall provide a monetary credit to
9    a subscriber's subsequent bill for service for the
10    proportional output of a community renewable generation
11    project attributable to that subscriber as specified in
12    Section 16-107.5 of the Public Utilities Act.
13        The Agency shall purchase renewable energy credits
14    from subscribed shares of photovoltaic community renewable
15    generation projects through the Adjustable Block program
16    described in subparagraph (K) of this paragraph (1) or
17    through the Illinois Solar for All Program described in
18    Section 1-56 of this Act. The electric utility shall
19    purchase any unsubscribed energy from community renewable
20    generation projects that are Qualifying Facilities ("QF")
21    under the electric utility's tariff for purchasing the
22    output from QFs under Public Utilities Regulatory Policies
23    Act of 1978.
24        The owners of and any subscribers to a community
25    renewable generation project shall not be considered
26    public utilities or alternative retail electricity

 

 

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1    suppliers under the Public Utilities Act solely as a
2    result of their interest in or subscription to a community
3    renewable generation project and shall not be required to
4    become an alternative retail electric supplier by
5    participating in a community renewable generation project
6    with a public utility.
7        (O) For the delivery year beginning June 1, 2018, the
8    long-term renewable resources procurement plan required by
9    this subsection (c) shall provide for the Agency to
10    procure contracts to continue offering the Illinois Solar
11    for All Program described in subsection (b) of Section
12    1-56 of this Act, and the contracts approved by the
13    Commission shall be executed by the utilities that are
14    subject to this subsection (c). The long-term renewable
15    resources procurement plan shall allocate up to
16    $50,000,000 per delivery year to fund the programs, and
17    the plan shall determine the amount of funding to be
18    apportioned to the programs identified in subsection (b)
19    of Section 1-56 of this Act; provided that for the
20    delivery years beginning June 1, 2021, June 1, 2022, and
21    June 1, 2023, the long-term renewable resources
22    procurement plan may average the annual budgets over a
23    3-year period to account for program ramp-up. For the
24    delivery years beginning June 1, 2021, June 1, 2024, June
25    1, 2027, and June 1, 2030 and additional $10,000,000 shall
26    be provided to the Department of Commerce and Economic

 

 

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1    Opportunity to implement the workforce development
2    programs and reporting as outlined in Section 16-108.12 of
3    the Public Utilities Act. In making the determinations
4    required under this subparagraph (O), the Commission shall
5    consider the experience and performance under the programs
6    and any evaluation reports. The Commission shall also
7    provide for an independent evaluation of those programs on
8    a periodic basis that are funded under this subparagraph
9    (O).
10        (P) All programs and procurements under this
11    subsection (c) shall be designed to encourage
12    participating projects to use a diverse and equitable
13    workforce and a diverse set of contractors, including
14    minority-owned businesses, disadvantaged businesses,
15    trade unions, graduates of any workforce training programs
16    administered under this Act, and small businesses.
17        The Agency shall develop a method to optimize
18    procurement of renewable energy credits from proposed
19    utility-scale projects that are located in communities
20    eligible to receive Energy Transition Community Grants
21    pursuant to Section 10-20 of the Energy Community
22    Reinvestment Act. If this requirement conflicts with other
23    provisions of law or the Agency determines that full
24    compliance with the requirements of this subparagraph (P)
25    would be unreasonably costly or administratively
26    impractical, the Agency is to propose alternative

 

 

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1    approaches to achieve development of renewable energy
2    resources in communities eligible to receive Energy
3    Transition Community Grants pursuant to Section 10-20 of
4    the Energy Community Reinvestment Act or seek an exemption
5    from this requirement from the Commission.
6        Any contractor involved in programs and procurements
7    under this subsection (c) for the construction of
8    State-funded solar and utility-scale wind projects must
9    have 50% or more of the contractor's employees be
10    residents of the State. The contractor must also
11    participate in a registered apprenticeship program, as
12    defined in Section 2-3.175 of the School Code, approved by
13    the federal Department of Labor.
14        (Q) Each facility listed in subitems (i) through
15    (viii) of item (1) of this subparagraph (Q) for which a
16    renewable energy credit delivery contract is signed after
17    the effective date of this amendatory Act of the 102nd
18    General Assembly is subject to the following requirements
19    through the Agency's long-term renewable resources
20    procurement plan:
21            (1) Each facility shall be subject to the
22        prevailing wage requirements included in the
23        Prevailing Wage Act. The Agency shall require
24        verification that all construction performed on the
25        facility by the renewable energy credit delivery
26        contract holder, its contractors, or its

 

 

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1        subcontractors relating to construction of the
2        facility is performed by construction employees
3        receiving an amount for that work equal to or greater
4        than the general prevailing rate, as that term is
5        defined in Section 3 of the Prevailing Wage Act. For
6        purposes of this item (1), "house of worship" means
7        property that is both (1) used exclusively by a
8        religious society or body of persons as a place for
9        religious exercise or religious worship and (2)
10        recognized as exempt from taxation pursuant to Section
11        15-40 of the Property Tax Code. This item (1) shall
12        apply to any the following:
13                (i) all new utility-scale wind projects;
14                (ii) all new utility-scale photovoltaic
15            projects;
16                (iii) all new brownfield photovoltaic
17            projects;
18                (iv) all new photovoltaic community renewable
19            energy facilities that qualify for item (iii) of
20            subparagraph (K) of this paragraph (1);
21                (v) all new community driven community
22            photovoltaic projects that qualify for item (v) of
23            subparagraph (K) of this paragraph (1);
24                (vi) all new photovoltaic distributed
25            renewable energy generation devices on schools
26            that qualify for item (iv) of subparagraph (K) of

 

 

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1            this paragraph (1);
2                (vii) all new photovoltaic distributed
3            renewable energy generation devices that (1)
4            qualify for item (i) of subparagraph (K) of this
5            paragraph (1); (2) are not projects that serve
6            single-family or multi-family residential
7            buildings; and (3) are not houses of worship where
8            the aggregate capacity including collocated
9            projects would not exceed 100 kilowatts;
10                (viii) all new photovoltaic distributed
11            renewable energy generation devices that (1)
12            qualify for item (ii) of subparagraph (K) of this
13            paragraph (1); (2) are not projects that serve
14            single-family or multi-family residential
15            buildings; and (3) are not houses of worship where
16            the aggregate capacity including collocated
17            projects would not exceed 100 kilowatts.
18            (2) Renewable energy credits procured from new
19        utility-scale wind projects, new utility-scale solar
20        projects, and new brownfield solar projects pursuant
21        to Agency procurement events occurring after the
22        effective date of this amendatory Act of the 102nd
23        General Assembly must be from facilities built by
24        general contractors that must enter into a project
25        labor agreement, as defined by this Act, prior to
26        construction. The project labor agreement shall be

 

 

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1        filed with the Director in accordance with procedures
2        established by the Agency through its long-term
3        renewable resources procurement plan. Any information
4        submitted to the Agency in this item (2) shall be
5        considered commercially sensitive information. At a
6        minimum, the project labor agreement must provide the
7        names, addresses, and occupations of the owner of the
8        plant and the individuals representing the labor
9        organization employees participating in the project
10        labor agreement consistent with the Project Labor
11        Agreements Act. The agreement must also specify the
12        terms and conditions as defined by this Act.
13            (3) It is the intent of this Section to ensure that
14        economic development occurs across Illinois
15        communities, that emerging businesses may grow, and
16        that there is improved access to the clean energy
17        economy by persons who have greater economic burdens
18        to success. The Agency shall take into consideration
19        the unique cost of compliance of this subparagraph (Q)
20        that might be borne by equity eligible contractors,
21        shall include such costs when determining the price of
22        renewable energy credits in the Adjustable Block
23        program, and shall take such costs into consideration
24        in a nondiscriminatory manner when comparing bids for
25        competitive procurements. The Agency shall consider
26        costs associated with compliance whether in the

 

 

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1        development, financing, or construction of projects.
2        The Agency shall periodically review the assumptions
3        in these costs and may adjust prices, in compliance
4        with subparagraph (M) of this paragraph (1).
5        (R) In its long-term renewable resources procurement
6    plan, the Agency shall establish a self-direct renewable
7    portfolio standard compliance program for eligible
8    self-direct customers that purchase renewable energy
9    credits from utility-scale wind and solar projects through
10    long-term agreements for purchase of renewable energy
11    credits as described in this Section. Such long-term
12    agreements may include the purchase of energy or other
13    products on a physical or financial basis and may involve
14    an alternative retail electric supplier as defined in
15    Section 16-102 of the Public Utilities Act. This program
16    shall take effect in the delivery year commencing June 1,
17    2023.
18            (1) For the purposes of this subparagraph:
19            "Eligible self-direct customer" means any retail
20        customers of an electric utility that serves 3,000,000
21        or more retail customers in the State and whose total
22        highest 30-minute demand was more than 10,000
23        kilowatts, or any retail customers of an electric
24        utility that serves less than 3,000,000 retail
25        customers but more than 500,000 retail customers in
26        the State and whose total highest 15-minute demand was

 

 

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1        more than 10,000 kilowatts.
2            "Retail customer" has the meaning set forth in
3        Section 16-102 of the Public Utilities Act and
4        multiple retail customer accounts under the same
5        corporate parent may aggregate their account demands
6        to meet the 10,000 kilowatt threshold. The criteria
7        for determining whether this subparagraph is
8        applicable to a retail customer shall be based on the
9        12 consecutive billing periods prior to the start of
10        the year in which the application is filed.
11            (2) For renewable energy credits to count toward
12        the self-direct renewable portfolio standard
13        compliance program, they must:
14                (i) qualify as renewable energy credits as
15            defined in Section 1-10 of this Act;
16                (ii) be sourced from one or more renewable
17            energy generating facilities that comply with the
18            geographic requirements as set forth in
19            subparagraph (I) of paragraph (1) of subsection
20            (c) as interpreted through the Agency's long-term
21            renewable resources procurement plan, or, where
22            applicable, the geographic requirements that
23            governed utility-scale renewable energy credits at
24            the time the eligible self-direct customer entered
25            into the applicable renewable energy credit
26            purchase agreement;

 

 

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1                (iii) be procured through long-term contracts
2            with term lengths of at least 10 years either
3            directly with the renewable energy generating
4            facility or through a bundled power purchase
5            agreement, a virtual power purchase agreement, an
6            agreement between the renewable generating
7            facility, an alternative retail electric supplier,
8            and the customer, or such other structure as is
9            permissible under this subparagraph (R);
10                (iv) be equivalent in volume to at least 40%
11            of the eligible self-direct customer's usage,
12            determined annually by the eligible self-direct
13            customer's usage during the previous delivery
14            year, measured to the nearest megawatt-hour;
15                (v) be retired by or on behalf of the large
16            energy customer;
17                (vi) be sourced from new utility-scale wind
18            projects or new utility-scale solar projects; and
19                (vii) if the contracts for renewable energy
20            credits are entered into after the effective date
21            of this amendatory Act of the 102nd General
22            Assembly, the new utility-scale wind projects or
23            new utility-scale solar projects must comply with
24            the requirements established in subparagraphs (P)
25            and (Q) of paragraph (1) of this subsection (c)
26            and subsection (c-10).

 

 

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1            (3) The self-direct renewable portfolio standard
2        compliance program shall be designed to allow eligible
3        self-direct customers to procure new renewable energy
4        credits from new utility-scale wind projects or new
5        utility-scale photovoltaic projects. The Agency shall
6        annually determine the amount of utility-scale
7        renewable energy credits it will include each year
8        from the self-direct renewable portfolio standard
9        compliance program, subject to receiving qualifying
10        applications. In making this determination, the Agency
11        shall evaluate publicly available analyses and studies
12        of the potential market size for utility-scale
13        renewable energy long-term purchase agreements by
14        commercial and industrial energy customers and make
15        that report publicly available. If demand for
16        participation in the self-direct renewable portfolio
17        standard compliance program exceeds availability, the
18        Agency shall ensure participation is evenly split
19        between commercial and industrial users to the extent
20        there is sufficient demand from both customer classes.
21        Each renewable energy credit procured pursuant to this
22        subparagraph (R) by a self-direct customer shall
23        reduce the total volume of renewable energy credits
24        the Agency is otherwise required to procure from new
25        utility-scale projects pursuant to subparagraph (C) of
26        paragraph (1) of this subsection (c) on behalf of

 

 

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1        contracting utilities where the eligible self-direct
2        customer is located. The self-direct customer shall
3        file an annual compliance report with the Agency
4        pursuant to terms established by the Agency through
5        its long-term renewable resources procurement plan to
6        be eligible for participation in this program.
7        Customers must provide the Agency with their most
8        recent electricity billing statements or other
9        information deemed necessary by the Agency to
10        demonstrate they are an eligible self-direct customer.
11            (4) The Commission shall approve a reduction in
12        the volumetric charges collected pursuant to Section
13        16-108 of the Public Utilities Act for approved
14        eligible self-direct customers equivalent to the
15        anticipated cost of renewable energy credit deliveries
16        under contracts for new utility-scale wind and new
17        utility-scale solar entered for each delivery year
18        after the large energy customer begins retiring
19        eligible new utility scale renewable energy credits
20        for self-compliance. The self-direct credit amount
21        shall be determined annually and is equal to the
22        estimated portion of the cost authorized by
23        subparagraph (E) of paragraph (1) of this subsection
24        (c) that supported the annual procurement of
25        utility-scale renewable energy credits in the prior
26        delivery year using a methodology described in the

 

 

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1        long-term renewable resources procurement plan,
2        expressed on a per kilowatthour basis, and does not
3        include (i) costs associated with any contracts
4        entered into before the delivery year in which the
5        customer files the initial compliance report to be
6        eligible for participation in the self-direct program,
7        and (ii) costs associated with procuring renewable
8        energy credits through existing and future contracts
9        through the Adjustable Block Program, subsection (c-5)
10        of this Section 1-75, and the Solar for All Program.
11        The Agency shall assist the Commission in determining
12        the current and future costs. The Agency must
13        determine the self-direct credit amount for new and
14        existing eligible self-direct customers and submit
15        this to the Commission in an annual compliance filing.
16        The Commission must approve the self-direct credit
17        amount by June 1, 2023 and June 1 of each delivery year
18        thereafter.
19            (5) Customers described in this subparagraph (R)
20        shall apply, on a form developed by the Agency, to the
21        Agency to be designated as a self-direct eligible
22        customer. Once the Agency determines that a
23        self-direct customer is eligible for participation in
24        the program, the self-direct customer will remain
25        eligible until the end of the term of the contract.
26        Thereafter, application may be made not less than 12

 

 

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1        months before the filing date of the long-term
2        renewable resources procurement plan described in this
3        Act. At a minimum, such application shall contain the
4        following:
5                (i) the customer's certification that, at the
6            time of the customer's application, the customer
7            qualifies to be a self-direct eligible customer,
8            including documents demonstrating that
9            qualification;
10                (ii) the customer's certification that the
11            customer has entered into or will enter into by
12            the beginning of the applicable procurement year,
13            one or more bilateral contracts for new wind
14            projects or new photovoltaic projects, including
15            supporting documentation;
16                (iii) certification that the contract or
17            contracts for new renewable energy resources are
18            long-term contracts with term lengths of at least
19            10 years, including supporting documentation;
20                (iv) certification of the quantities of
21            renewable energy credits that the customer will
22            purchase each year under such contract or
23            contracts, including supporting documentation;
24                (v) proof that the contract is sufficient to
25            produce renewable energy credits to be equivalent
26            in volume to at least 40% of the large energy

 

 

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1            customer's usage from the previous delivery year,
2            measured to the nearest megawatt-hour; and
3                (vi) certification that the customer intends
4            to maintain the contract for the duration of the
5            length of the contract.
6            (6) If a customer receives the self-direct credit
7        but fails to properly procure and retire renewable
8        energy credits as required under this subparagraph
9        (R), the Commission, on petition from the Agency and
10        after notice and hearing, may direct such customer's
11        utility to recover the cost of the wrongfully received
12        self-direct credits plus interest through an adder to
13        charges assessed pursuant to Section 16-108 of the
14        Public Utilities Act. Self-direct customers who
15        knowingly fail to properly procure and retire
16        renewable energy credits and do not notify the Agency
17        are ineligible for continued participation in the
18        self-direct renewable portfolio standard compliance
19        program.
20        (2) (Blank).
21        (3) (Blank).
22        (4) The electric utility shall retire all renewable
23    energy credits used to comply with the standard.
24        (5) Beginning with the 2010 delivery year and ending
25    June 1, 2017, an electric utility subject to this
26    subsection (c) shall apply the lesser of the maximum

 

 

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1    alternative compliance payment rate or the most recent
2    estimated alternative compliance payment rate for its
3    service territory for the corresponding compliance period,
4    established pursuant to subsection (d) of Section 16-115D
5    of the Public Utilities Act to its retail customers that
6    take service pursuant to the electric utility's hourly
7    pricing tariff or tariffs. The electric utility shall
8    retain all amounts collected as a result of the
9    application of the alternative compliance payment rate or
10    rates to such customers, and, beginning in 2011, the
11    utility shall include in the information provided under
12    item (1) of subsection (d) of Section 16-111.5 of the
13    Public Utilities Act the amounts collected under the
14    alternative compliance payment rate or rates for the prior
15    year ending May 31. Notwithstanding any limitation on the
16    procurement of renewable energy resources imposed by item
17    (2) of this subsection (c), the Agency shall increase its
18    spending on the purchase of renewable energy resources to
19    be procured by the electric utility for the next plan year
20    by an amount equal to the amounts collected by the utility
21    under the alternative compliance payment rate or rates in
22    the prior year ending May 31.
23        (6) The electric utility shall be entitled to recover
24    all of its costs associated with the procurement of
25    renewable energy credits under plans approved under this
26    Section and Section 16-111.5 of the Public Utilities Act.

 

 

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1    These costs shall include associated reasonable expenses
2    for implementing the procurement programs, including, but
3    not limited to, the costs of administering and evaluating
4    the Adjustable Block program, through an automatic
5    adjustment clause tariff in accordance with subsection (k)
6    of Section 16-108 of the Public Utilities Act.
7        (7) Renewable energy credits procured from new
8    photovoltaic projects or new distributed renewable energy
9    generation devices under this Section after June 1, 2017
10    (the effective date of Public Act 99-906) must be procured
11    from devices installed by a qualified person in compliance
12    with the requirements of Section 16-128A of the Public
13    Utilities Act and any rules or regulations adopted
14    thereunder.
15        In meeting the renewable energy requirements of this
16    subsection (c), to the extent feasible and consistent with
17    State and federal law, the renewable energy credit
18    procurements, Adjustable Block solar program, and
19    community renewable generation program shall provide
20    employment opportunities for all segments of the
21    population and workforce, including minority-owned and
22    female-owned business enterprises, and shall not,
23    consistent with State and federal law, discriminate based
24    on race or socioeconomic status.
25    (c-5) Procurement of renewable energy credits from new
26renewable energy facilities installed at or adjacent to the

 

 

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1sites of electric generating facilities that burn or burned
2coal as their primary fuel source.
3        (1) In addition to the procurement of renewable energy
4    credits pursuant to long-term renewable resources
5    procurement plans in accordance with subsection (c) of
6    this Section and Section 16-111.5 of the Public Utilities
7    Act, the Agency shall conduct procurement events in
8    accordance with this subsection (c-5) for the procurement
9    by electric utilities that served more than 300,000 retail
10    customers in this State as of January 1, 2019 of renewable
11    energy credits from new renewable energy facilities to be
12    installed at or adjacent to the sites of electric
13    generating facilities that, as of January 1, 2016, burned
14    coal as their primary fuel source and meet the other
15    criteria specified in this subsection (c-5). For purposes
16    of this subsection (c-5), "new renewable energy facility"
17    means a new utility-scale solar project as defined in this
18    Section 1-75. The renewable energy credits procured
19    pursuant to this subsection (c-5) may be included or
20    counted for purposes of compliance with the amounts of
21    renewable energy credits required to be procured pursuant
22    to subsection (c) of this Section to the extent that there
23    are otherwise shortfalls in compliance with such
24    requirements. The procurement of renewable energy credits
25    by electric utilities pursuant to this subsection (c-5)
26    shall be funded solely by revenues collected from the Coal

 

 

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1    to Solar and Energy Storage Initiative Charge provided for
2    in this subsection (c-5) and subsection (i-5) of Section
3    16-108 of the Public Utilities Act, shall not be funded by
4    revenues collected through any of the other funding
5    mechanisms provided for in subsection (c) of this Section,
6    and shall not be subject to the limitation imposed by
7    subsection (c) on charges to retail customers for costs to
8    procure renewable energy resources pursuant to subsection
9    (c), and shall not be subject to any other requirements or
10    limitations of subsection (c).
11        (2) The Agency shall conduct 2 procurement events to
12    select owners of electric generating facilities meeting
13    the eligibility criteria specified in this subsection
14    (c-5) to enter into long-term contracts to sell renewable
15    energy credits to electric utilities serving more than
16    300,000 retail customers in this State as of January 1,
17    2019. The first procurement event shall be conducted no
18    later than March 31, 2022, unless the Agency elects to
19    delay it, until no later than May 1, 2022, due to its
20    overall volume of work, and shall be to select owners of
21    electric generating facilities located in this State and
22    south of federal Interstate Highway 80 that meet the
23    eligibility criteria specified in this subsection (c-5).
24    The second procurement event shall be conducted no sooner
25    than September 30, 2022 and no later than October 31, 2022
26    and shall be to select owners of electric generating

 

 

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1    facilities located anywhere in this State that meet the
2    eligibility criteria specified in this subsection (c-5).
3    The Agency shall establish and announce a time period,
4    which shall begin no later than 30 days prior to the
5    scheduled date for the procurement event, during which
6    applicants may submit applications to be selected as
7    suppliers of renewable energy credits pursuant to this
8    subsection (c-5). The eligibility criteria for selection
9    as a supplier of renewable energy credits pursuant to this
10    subsection (c-5) shall be as follows:
11            (A) The applicant owns an electric generating
12        facility located in this State that: (i) as of January
13        1, 2016, burned coal as its primary fuel to generate
14        electricity; and (ii) has, or had prior to retirement,
15        an electric generating capacity of at least 150
16        megawatts. The electric generating facility can be
17        either: (i) retired as of the date of the procurement
18        event; or (ii) still operating as of the date of the
19        procurement event.
20            (B) The applicant is not (i) an electric
21        cooperative as defined in Section 3-119 of the Public
22        Utilities Act, or (ii) an entity described in
23        subsection (b)(1) of Section 3-105 of the Public
24        Utilities Act, or an association or consortium of or
25        an entity owned by entities described in (i) or (ii);
26        and the coal-fueled electric generating facility was

 

 

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1        at one time owned, in whole or in part, by a public
2        utility as defined in Section 3-105 of the Public
3        Utilities Act.
4            (C) If participating in the first procurement
5        event, the applicant proposes and commits to construct
6        and operate, at the site, and if necessary for
7        sufficient space on property adjacent to the existing
8        property, at which the electric generating facility
9        identified in paragraph (A) is located: (i) a new
10        renewable energy facility of at least 20 megawatts but
11        no more than 100 megawatts of electric generating
12        capacity, and (ii) an energy storage facility having a
13        storage capacity equal to at least 2 megawatts and at
14        most 10 megawatts. If participating in the second
15        procurement event, the applicant proposes and commits
16        to construct and operate, at the site, and if
17        necessary for sufficient space on property adjacent to
18        the existing property, at which the electric
19        generating facility identified in paragraph (A) is
20        located: (i) a new renewable energy facility of at
21        least 5 megawatts but no more than 20 megawatts of
22        electric generating capacity, and (ii) an energy
23        storage facility having a storage capacity equal to at
24        least 0.5 megawatts and at most one megawatt.
25            (D) The applicant agrees that the new renewable
26        energy facility and the energy storage facility will

 

 

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1        be constructed or installed by a qualified entity or
2        entities in compliance with the requirements of
3        subsection (g) of Section 16-128A of the Public
4        Utilities Act and any rules adopted thereunder.
5            (E) The applicant agrees that personnel operating
6        the new renewable energy facility and the energy
7        storage facility will have the requisite skills,
8        knowledge, training, experience, and competence, which
9        may be demonstrated by completion or current
10        participation and ultimate completion by employees of
11        an accredited or otherwise recognized apprenticeship
12        program for the employee's particular craft, trade, or
13        skill, including through training and education
14        courses and opportunities offered by the owner to
15        employees of the coal-fueled electric generating
16        facility or by previous employment experience
17        performing the employee's particular work skill or
18        function.
19            (F) The applicant commits that not less than the
20        prevailing wage, as determined pursuant to the
21        Prevailing Wage Act, will be paid to the applicant's
22        employees engaged in construction activities
23        associated with the new renewable energy facility and
24        the new energy storage facility and to the employees
25        of applicant's contractors engaged in construction
26        activities associated with the new renewable energy

 

 

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1        facility and the new energy storage facility, and
2        that, on or before the commercial operation date of
3        the new renewable energy facility, the applicant shall
4        file a report with the Agency certifying that the
5        requirements of this subparagraph (F) have been met.
6            (G) The applicant commits that if selected, it
7        will negotiate a project labor agreement for the
8        construction of the new renewable energy facility and
9        associated energy storage facility that includes
10        provisions requiring the parties to the agreement to
11        work together to establish diversity threshold
12        requirements and to ensure best efforts to meet
13        diversity targets, improve diversity at the applicable
14        job site, create diverse apprenticeship opportunities,
15        and create opportunities to employ former coal-fired
16        power plant workers.
17            (H) The applicant commits to enter into a contract
18        or contracts for the applicable duration to provide
19        specified numbers of renewable energy credits each
20        year from the new renewable energy facility to
21        electric utilities that served more than 300,000
22        retail customers in this State as of January 1, 2019,
23        at a price of $30 per renewable energy credit. The
24        price per renewable energy credit shall be fixed at
25        $30 for the applicable duration and the renewable
26        energy credits shall not be indexed renewable energy

 

 

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1        credits as provided for in item (v) of subparagraph
2        (G) of paragraph (1) of subsection (c) of Section 1-75
3        of this Act. The applicable duration of each contract
4        shall be 20 years, unless the applicant is physically
5        interconnected to the PJM Interconnection, LLC
6        transmission grid and had a generating capacity of at
7        least 1,200 megawatts as of January 1, 2021, in which
8        case the applicable duration of the contract shall be
9        15 years.
10            (I) The applicant's application is certified by an
11        officer of the applicant and by an officer of the
12        applicant's ultimate parent company, if any.
13        (3) An applicant may submit applications to contract
14    to supply renewable energy credits from more than one new
15    renewable energy facility to be constructed at or adjacent
16    to one or more qualifying electric generating facilities
17    owned by the applicant. The Agency may select new
18    renewable energy facilities to be located at or adjacent
19    to the sites of more than one qualifying electric
20    generation facility owned by an applicant to contract with
21    electric utilities to supply renewable energy credits from
22    such facilities.
23        (4) The Agency shall assess fees to each applicant to
24    recover the Agency's costs incurred in receiving and
25    evaluating applications, conducting the procurement event,
26    developing contracts for sale, delivery and purchase of

 

 

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1    renewable energy credits, and monitoring the
2    administration of such contracts, as provided for in this
3    subsection (c-5), including fees paid to a procurement
4    administrator retained by the Agency for one or more of
5    these purposes.
6        (5) The Agency shall select the applicants and the new
7    renewable energy facilities to contract with electric
8    utilities to supply renewable energy credits in accordance
9    with this subsection (c-5). In the first procurement
10    event, the Agency shall select applicants and new
11    renewable energy facilities to supply renewable energy
12    credits, at a price of $30 per renewable energy credit,
13    aggregating to no less than 400,000 renewable energy
14    credits per year for the applicable duration, assuming
15    sufficient qualifying applications to supply, in the
16    aggregate, at least that amount of renewable energy
17    credits per year; and not more than 580,000 renewable
18    energy credits per year for the applicable duration. In
19    the second procurement event, the Agency shall select
20    applicants and new renewable energy facilities to supply
21    renewable energy credits, at a price of $30 per renewable
22    energy credit, aggregating to no more than 625,000
23    renewable energy credits per year less the amount of
24    renewable energy credits each year contracted for as a
25    result of the first procurement event, for the applicable
26    durations. The number of renewable energy credits to be

 

 

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1    procured as specified in this paragraph (5) shall not be
2    reduced based on renewable energy credits procured in the
3    self-direct renewable energy credit compliance program
4    established pursuant to subparagraph (R) of paragraph (1)
5    of subsection (c) of Section 1-75.
6        (6) The obligation to purchase renewable energy
7    credits from the applicants and their new renewable energy
8    facilities selected by the Agency shall be allocated to
9    the electric utilities based on their respective
10    percentages of kilowatthours delivered to delivery
11    services customers to the aggregate kilowatthour
12    deliveries by the electric utilities to delivery services
13    customers for the year ended December 31, 2021. In order
14    to achieve these allocation percentages between or among
15    the electric utilities, the Agency shall require each
16    applicant that is selected in the procurement event to
17    enter into a contract with each electric utility for the
18    sale and purchase of renewable energy credits from each
19    new renewable energy facility to be constructed and
20    operated by the applicant, with the sale and purchase
21    obligations under the contracts to aggregate to the total
22    number of renewable energy credits per year to be supplied
23    by the applicant from the new renewable energy facility.
24        (7) The Agency shall submit its proposed selection of
25    applicants, new renewable energy facilities to be
26    constructed, and renewable energy credit amounts for each

 

 

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1    procurement event to the Commission for approval. The
2    Commission shall, within 2 business days after receipt of
3    the Agency's proposed selections, approve the proposed
4    selections if it determines that the applicants and the
5    new renewable energy facilities to be constructed meet the
6    selection criteria set forth in this subsection (c-5) and
7    that the Agency seeks approval for contracts of applicable
8    durations aggregating to no more than the maximum amount
9    of renewable energy credits per year authorized by this
10    subsection (c-5) for the procurement event, at a price of
11    $30 per renewable energy credit.
12        (8) The Agency, in conjunction with its procurement
13    administrator if one is retained, the electric utilities,
14    and potential applicants for contracts to produce and
15    supply renewable energy credits pursuant to this
16    subsection (c-5), shall develop a standard form contract
17    for the sale, delivery and purchase of renewable energy
18    credits pursuant to this subsection (c-5). Each contract
19    resulting from the first procurement event shall allow for
20    a commercial operation date for the new renewable energy
21    facility of either June 1, 2023 or June 1, 2024, with such
22    dates subject to adjustment as provided in this paragraph.
23    Each contract resulting from the second procurement event
24    shall provide for a commercial operation date on June 1
25    next occurring up to 48 months after execution of the
26    contract. Each contract shall provide that the owner shall

 

 

HB2563- 91 -LRB103 29504 AMQ 55899 b

1    receive payments for renewable energy credits for the
2    applicable durations beginning with the commercial
3    operation date of the new renewable energy facility. The
4    form contract shall provide for adjustments to the
5    commercial operation and payment start dates as needed due
6    to any delays in completing the procurement and
7    contracting processes, in finalizing interconnection
8    agreements and installing interconnection facilities, and
9    in obtaining other necessary governmental permits and
10    approvals. The form contract shall be, to the maximum
11    extent possible, consistent with standard electric
12    industry contracts for sale, delivery, and purchase of
13    renewable energy credits while taking into account the
14    specific requirements of this subsection (c-5). The form
15    contract shall provide for over-delivery and
16    under-delivery of renewable energy credits within
17    reasonable ranges during each 12-month period and penalty,
18    default, and enforcement provisions for failure of the
19    selling party to deliver renewable energy credits as
20    specified in the contract and to comply with the
21    requirements of this subsection (c-5). The standard form
22    contract shall specify that all renewable energy credits
23    delivered to the electric utility pursuant to the contract
24    shall be retired. The Agency shall make the proposed
25    contracts available for a reasonable period for comment by
26    potential applicants, and shall publish the final form

 

 

HB2563- 92 -LRB103 29504 AMQ 55899 b

1    contract at least 30 days before the date of the first
2    procurement event.
3        (9) Coal to Solar and Energy Storage Initiative
4    Charge.
5            (A) By no later than July 1, 2022, each electric
6        utility that served more than 300,000 retail customers
7        in this State as of January 1, 2019 shall file a tariff
8        with the Commission for the billing and collection of
9        a Coal to Solar and Energy Storage Initiative Charge
10        in accordance with subsection (i-5) of Section 16-108
11        of the Public Utilities Act, with such tariff to be
12        effective, following review and approval or
13        modification by the Commission, beginning January 1,
14        2023. The tariff shall provide for the calculation and
15        setting of the electric utility's Coal to Solar and
16        Energy Storage Initiative Charge to collect revenues
17        estimated to be sufficient, in the aggregate, (i) to
18        enable the electric utility to pay for the renewable
19        energy credits it has contracted to purchase in the
20        delivery year beginning June 1, 2023 and each delivery
21        year thereafter from new renewable energy facilities
22        located at the sites of qualifying electric generating
23        facilities, and (ii) to fund the grant payments to be
24        made in each delivery year by the Department of
25        Commerce and Economic Opportunity, or any successor
26        department or agency, which shall be referred to in

 

 

HB2563- 93 -LRB103 29504 AMQ 55899 b

1        this subsection (c-5) as the Department, pursuant to
2        paragraph (10) of this subsection (c-5). The electric
3        utility's tariff shall provide for the billing and
4        collection of the Coal to Solar and Energy Storage
5        Initiative Charge on each kilowatthour of electricity
6        delivered to its delivery services customers within
7        its service territory and shall provide for an annual
8        reconciliation of revenues collected with actual
9        costs, in accordance with subsection (i-5) of Section
10        16-108 of the Public Utilities Act.
11            (B) Each electric utility shall remit on a monthly
12        basis to the State Treasurer, for deposit in the Coal
13        to Solar and Energy Storage Initiative Fund provided
14        for in this subsection (c-5), the electric utility's
15        collections of the Coal to Solar and Energy Storage
16        Initiative Charge in the amount estimated to be needed
17        by the Department for grant payments pursuant to grant
18        contracts entered into by the Department pursuant to
19        paragraph (10) of this subsection (c-5).
20        (10) Coal to Solar and Energy Storage Initiative Fund.
21            (A) The Coal to Solar and Energy Storage
22        Initiative Fund is established as a special fund in
23        the State treasury. The Coal to Solar and Energy
24        Storage Initiative Fund is authorized to receive, by
25        statutory deposit, that portion specified in item (B)
26        of paragraph (9) of this subsection (c-5) of moneys

 

 

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1        collected by electric utilities through imposition of
2        the Coal to Solar and Energy Storage Initiative Charge
3        required by this subsection (c-5). The Coal to Solar
4        and Energy Storage Initiative Fund shall be
5        administered by the Department to provide grants to
6        support the installation and operation of energy
7        storage facilities at the sites of qualifying electric
8        generating facilities meeting the criteria specified
9        in this paragraph (10).
10            (B) The Coal to Solar and Energy Storage
11        Initiative Fund shall not be subject to sweeps,
12        administrative charges, or chargebacks, including, but
13        not limited to, those authorized under Section 8h of
14        the State Finance Act, that would in any way result in
15        the transfer of those funds from the Coal to Solar and
16        Energy Storage Initiative Fund to any other fund of
17        this State or in having any such funds utilized for any
18        purpose other than the express purposes set forth in
19        this paragraph (10).
20            (C) The Department shall utilize up to
21        $280,500,000 in the Coal to Solar and Energy Storage
22        Initiative Fund for grants, assuming sufficient
23        qualifying applicants, to support installation of
24        energy storage facilities at the sites of up to 3
25        qualifying electric generating facilities located in
26        the Midcontinent Independent System Operator, Inc.,

 

 

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1        region in Illinois and the sites of up to 2 qualifying
2        electric generating facilities located in the PJM
3        Interconnection, LLC region in Illinois that meet the
4        criteria set forth in this subparagraph (C). The
5        criteria for receipt of a grant pursuant to this
6        subparagraph (C) are as follows:
7                (1) the electric generating facility at the
8            site has, or had prior to retirement, an electric
9            generating capacity of at least 150 megawatts;
10                (2) the electric generating facility burns (or
11            burned prior to retirement) coal as its primary
12            source of fuel;
13                (3) if the electric generating facility is
14            retired, it was retired subsequent to January 1,
15            2016;
16                (4) the owner of the electric generating
17            facility has not been selected by the Agency
18            pursuant to this subsection (c-5) of this Section
19            to enter into a contract to sell renewable energy
20            credits to one or more electric utilities from a
21            new renewable energy facility located or to be
22            located at or adjacent to the site at which the
23            electric generating facility is located;
24                (5) the electric generating facility located
25            at the site was at one time owned, in whole or in
26            part, by a public utility as defined in Section

 

 

HB2563- 96 -LRB103 29504 AMQ 55899 b

1            3-105 of the Public Utilities Act;
2                (6) the electric generating facility at the
3            site is not owned by (i) an electric cooperative
4            as defined in Section 3-119 of the Public
5            Utilities Act, or (ii) an entity described in
6            subsection (b)(1) of Section 3-105 of the Public
7            Utilities Act, or an association or consortium of
8            or an entity owned by entities described in items
9            (i) or (ii);
10                (7) the proposed energy storage facility at
11            the site will have energy storage capacity of at
12            least 37 megawatts;
13                (8) the owner commits to place the energy
14            storage facility into commercial operation on
15            either June 1, 2023, June 1, 2024, or June 1, 2025,
16            with such date subject to adjustment as needed due
17            to any delays in completing the grant contracting
18            process, in finalizing interconnection agreements
19            and in installing interconnection facilities, and
20            in obtaining necessary governmental permits and
21            approvals;
22                (9) the owner agrees that the new energy
23            storage facility will be constructed or installed
24            by a qualified entity or entities consistent with
25            the requirements of subsection (g) of Section
26            16-128A of the Public Utilities Act and any rules

 

 

HB2563- 97 -LRB103 29504 AMQ 55899 b

1            adopted under that Section;
2                (10) the owner agrees that personnel operating
3            the energy storage facility will have the
4            requisite skills, knowledge, training, experience,
5            and competence, which may be demonstrated by
6            completion or current participation and ultimate
7            completion by employees of an accredited or
8            otherwise recognized apprenticeship program for
9            the employee's particular craft, trade, or skill,
10            including through training and education courses
11            and opportunities offered by the owner to
12            employees of the coal-fueled electric generating
13            facility or by previous employment experience
14            performing the employee's particular work skill or
15            function;
16                (11) the owner commits that not less than the
17            prevailing wage, as determined pursuant to the
18            Prevailing Wage Act, will be paid to the owner's
19            employees engaged in construction activities
20            associated with the new energy storage facility
21            and to the employees of the owner's contractors
22            engaged in construction activities associated with
23            the new energy storage facility, and that, on or
24            before the commercial operation date of the new
25            energy storage facility, the owner shall file a
26            report with the Department certifying that the

 

 

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1            requirements of this subparagraph (11) have been
2            met; and
3                (12) the owner commits that if selected to
4            receive a grant, it will negotiate a project labor
5            agreement for the construction of the new energy
6            storage facility that includes provisions
7            requiring the parties to the agreement to work
8            together to establish diversity threshold
9            requirements and to ensure best efforts to meet
10            diversity targets, improve diversity at the
11            applicable job site, create diverse apprenticeship
12            opportunities, and create opportunities to employ
13            former coal-fired power plant workers.
14            The Department shall accept applications for this
15        grant program until March 31, 2022 and shall announce
16        the award of grants no later than June 1, 2022. The
17        Department shall make the grant payments to a
18        recipient in equal annual amounts for 10 years
19        following the date the energy storage facility is
20        placed into commercial operation. The annual grant
21        payments to a qualifying energy storage facility shall
22        be $110,000 per megawatt of energy storage capacity,
23        with total annual grant payments pursuant to this
24        subparagraph (C) for qualifying energy storage
25        facilities not to exceed $28,050,000 in any year.
26            (D) Grants of funding for energy storage

 

 

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1        facilities pursuant to subparagraph (C) of this
2        paragraph (10), from the Coal to Solar and Energy
3        Storage Initiative Fund, shall be memorialized in
4        grant contracts between the Department and the
5        recipient. The grant contracts shall specify the date
6        or dates in each year on which the annual grant
7        payments shall be paid.
8            (E) All disbursements from the Coal to Solar and
9        Energy Storage Initiative Fund shall be made only upon
10        warrants of the Comptroller drawn upon the Treasurer
11        as custodian of the Fund upon vouchers signed by the
12        Director of the Department or by the person or persons
13        designated by the Director of the Department for that
14        purpose. The Comptroller is authorized to draw the
15        warrants upon vouchers so signed. The Treasurer shall
16        accept all written warrants so signed and shall be
17        released from liability for all payments made on those
18        warrants.
19        (11) Diversity, equity, and inclusion plans.
20            (A) Each applicant selected in a procurement event
21        to contract to supply renewable energy credits in
22        accordance with this subsection (c-5) and each owner
23        selected by the Department to receive a grant or
24        grants to support the construction and operation of a
25        new energy storage facility or facilities in
26        accordance with this subsection (c-5) shall, within 60

 

 

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1        days following the Commission's approval of the
2        applicant to contract to supply renewable energy
3        credits or within 60 days following execution of a
4        grant contract with the Department, as applicable,
5        submit to the Commission a diversity, equity, and
6        inclusion plan setting forth the applicant's or
7        owner's numeric goals for the diversity composition of
8        its supplier entities for the new renewable energy
9        facility or new energy storage facility, as
10        applicable, which shall be referred to for purposes of
11        this paragraph (11) as the project, and the
12        applicant's or owner's action plan and schedule for
13        achieving those goals.
14            (B) For purposes of this paragraph (11), diversity
15        composition shall be based on the percentage, which
16        shall be a minimum of 25%, of eligible expenditures
17        for contract awards for materials and services (which
18        shall be defined in the plan) to business enterprises
19        owned by minority persons, women, or persons with
20        disabilities as defined in Section 2 of the Business
21        Enterprise for Minorities, Women, and Persons with
22        Disabilities Act, to LGBTQ business enterprises, to
23        veteran-owned business enterprises, and to business
24        enterprises located in environmental justice
25        communities. The diversity composition goals of the
26        plan may include eligible expenditures in areas for

 

 

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1        vendor or supplier opportunities in addition to
2        development and construction of the project, and may
3        exclude from eligible expenditures materials and
4        services with limited market availability, limited
5        production and availability from suppliers in the
6        United States, such as solar panels and storage
7        batteries, and material and services that are subject
8        to critical energy infrastructure or cybersecurity
9        requirements or restrictions. The plan may provide
10        that the diversity composition goals may be met
11        through Tier 1 Direct or Tier 2 subcontracting
12        expenditures or a combination thereof for the project.
13            (C) The plan shall provide for, but not be limited
14        to: (i) internal initiatives, including multi-tier
15        initiatives, by the applicant or owner, or by its
16        engineering, procurement and construction contractor
17        if one is used for the project, which for purposes of
18        this paragraph (11) shall be referred to as the EPC
19        contractor, to enable diverse businesses to be
20        considered fairly for selection to provide materials
21        and services; (ii) requirements for the applicant or
22        owner or its EPC contractor to proactively solicit and
23        utilize diverse businesses to provide materials and
24        services; and (iii) requirements for the applicant or
25        owner or its EPC contractor to hire a diverse
26        workforce for the project. The plan shall include a

 

 

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1        description of the applicant's or owner's diversity
2        recruiting efforts both for the project and for other
3        areas of the applicant's or owner's business
4        operations. The plan shall provide for the imposition
5        of financial penalties on the applicant's or owner's
6        EPC contractor for failure to exercise best efforts to
7        comply with and execute the EPC contractor's diversity
8        obligations under the plan. The plan may provide for
9        the applicant or owner to set aside a portion of the
10        work on the project to serve as an incubation program
11        for qualified businesses, as specified in the plan,
12        owned by minority persons, women, persons with
13        disabilities, LGBTQ persons, and veterans, and
14        businesses located in environmental justice
15        communities, seeking to enter the renewable energy
16        industry.
17            (D) The applicant or owner may submit a revised or
18        updated plan to the Commission from time to time as
19        circumstances warrant. The applicant or owner shall
20        file annual reports with the Commission detailing the
21        applicant's or owner's progress in implementing its
22        plan and achieving its goals and any modifications the
23        applicant or owner has made to its plan to better
24        achieve its diversity, equity and inclusion goals. The
25        applicant or owner shall file a final report on the
26        fifth June 1 following the commercial operation date

 

 

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1        of the new renewable energy resource or new energy
2        storage facility, but the applicant or owner shall
3        thereafter continue to be subject to applicable
4        reporting requirements of Section 5-117 of the Public
5        Utilities Act.
6    (c-10) Equity accountability system. It is the purpose of
7this subsection (c-10) to create an equity accountability
8system, which includes the minimum equity standards for all
9renewable energy procurements, the equity category of the
10Adjustable Block Program, and the equity prioritization for
11noncompetitive procurements, that is successful in advancing
12priority access to the clean energy economy for businesses and
13workers from communities that have been excluded from economic
14opportunities in the energy sector, have been subject to
15disproportionate levels of pollution, and have
16disproportionately experienced negative public health
17outcomes. Further, it is the purpose of this subsection to
18ensure that this equity accountability system is successful in
19advancing equity across Illinois by providing access to the
20clean energy economy for businesses and workers from
21communities that have been historically excluded from economic
22opportunities in the energy sector, have been subject to
23disproportionate levels of pollution, and have
24disproportionately experienced negative public health
25outcomes.
26        (1) Minimum equity standards. The Agency shall create

 

 

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1    programs with the purpose of increasing access to and
2    development of equity eligible contractors, who are prime
3    contractors and subcontractors, across all of the programs
4    it manages. All applications for renewable energy credit
5    procurements shall comply with specific minimum equity
6    commitments. Starting in the delivery year immediately
7    following the next long-term renewable resources
8    procurement plan, at least 10% of the project workforce
9    for each entity participating in a procurement program
10    outlined in this subsection (c-10) must be done by equity
11    eligible persons or equity eligible contractors. The
12    Agency shall increase the minimum percentage each delivery
13    year thereafter by increments that ensure a statewide
14    average of 30% of the project workforce for each entity
15    participating in a procurement program is done by equity
16    eligible persons or equity eligible contractors by 2030.
17    The Agency shall propose a schedule of percentage
18    increases to the minimum equity standards in its draft
19    revised renewable energy resources procurement plan
20    submitted to the Commission for approval pursuant to
21    paragraph (5) of subsection (b) of Section 16-111.5 of the
22    Public Utilities Act. In determining these annual
23    increases, the Agency shall have the discretion to
24    establish different minimum equity standards for different
25    types of procurements and different regions of the State
26    if the Agency finds that doing so will further the

 

 

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1    purposes of this subsection (c-10). The proposed schedule
2    of annual increases shall be revisited and updated on an
3    annual basis. Revisions shall be developed with
4    stakeholder input, including from equity eligible persons,
5    equity eligible contractors, clean energy industry
6    representatives, and community-based organizations that
7    work with such persons and contractors.
8            (A) At the start of each delivery year, the Agency
9        shall require a compliance plan from each entity
10        participating in a procurement program of subsection
11        (c) of this Section that demonstrates how they will
12        achieve compliance with the minimum equity standard
13        percentage for work completed in that delivery year.
14        If an entity applies for its approved vendor or
15        designee status between delivery years, the Agency
16        shall require a compliance plan at the time of
17        application.
18            (B) Halfway through each delivery year, the Agency
19        shall require each entity participating in a
20        procurement program to confirm that it will achieve
21        compliance in that delivery year, when applicable. The
22        Agency may offer corrective action plans to entities
23        that are not on track to achieve compliance.
24            (C) At the end of each delivery year, each entity
25        participating and completing work in that delivery
26        year in a procurement program of subsection (c) shall

 

 

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1        submit a report to the Agency that demonstrates how it
2        achieved compliance with the minimum equity standards
3        percentage for that delivery year.
4            (D) The Agency shall prohibit participation in
5        procurement programs by an approved vendor or
6        designee, as applicable, or entities with which an
7        approved vendor or designee, as applicable, shares a
8        common parent company if an approved vendor or
9        designee, as applicable, failed to meet the minimum
10        equity standards for the prior delivery year. Waivers
11        approved for lack of equity eligible persons or equity
12        eligible contractors in a geographic area of a project
13        shall not count against the approved vendor or
14        designee. The Agency shall offer a corrective action
15        plan for any such entities to assist them in obtaining
16        compliance and shall allow continued access to
17        procurement programs upon an approved vendor or
18        designee demonstrating compliance.
19            (E) The Agency shall pursue efficiencies achieved
20        by combining with other approved vendor or designee
21        reporting.
22        (2) Equity accountability system within the Adjustable
23    Block program. The equity category described in item (vi)
24    of subparagraph (K) of subsection (c) is only available to
25    applicants that are equity eligible contractors.
26        (3) Equity accountability system within competitive

 

 

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1    procurements. Through its long-term renewable resources
2    procurement plan, the Agency shall develop requirements
3    for ensuring that competitive procurement processes,
4    including utility-scale solar, utility-scale wind, and
5    brownfield site photovoltaic projects, advance the equity
6    goals of this subsection (c-10). Subject to Commission
7    approval, the Agency shall develop bid application
8    requirements and a bid evaluation methodology for ensuring
9    that utilization of equity eligible contractors, whether
10    as bidders or as participants on project development, is
11    optimized, including requiring that winning or successful
12    applicants for utility-scale projects are or will partner
13    with equity eligible contractors and giving preference to
14    bids through which a higher portion of contract value
15    flows to equity eligible contractors. To the extent
16    practicable, entities participating in competitive
17    procurements shall also be required to meet all the equity
18    accountability requirements for approved vendors and their
19    designees under this subsection (c-10). In developing
20    these requirements, the Agency shall also consider whether
21    equity goals can be further advanced through additional
22    measures.
23        (4) In the first revision to the long-term renewable
24    energy resources procurement plan and each revision
25    thereafter, the Agency shall include the following:
26            (A) The current status and number of equity

 

 

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1        eligible contractors listed in the Energy Workforce
2        Equity Database designed in subsection (c-25),
3        including the number of equity eligible contractors
4        with current certifications as issued by the Agency.
5            (B) A mechanism for measuring, tracking, and
6        reporting project workforce at the approved vendor or
7        designee level, as applicable, which shall include a
8        measurement methodology and records to be made
9        available for audit by the Agency or the Program
10        Administrator.
11            (C) A program for approved vendors, designees,
12        eligible persons, and equity eligible contractors to
13        receive trainings, guidance, and other support from
14        the Agency or its designee regarding the equity
15        category outlined in item (vi) of subparagraph (K) of
16        paragraph (1) of subsection (c) and in meeting the
17        minimum equity standards of this subsection (c-10).
18            (D) A process for certifying equity eligible
19        contractors and equity eligible persons. The
20        certification process shall coordinate with the Energy
21        Workforce Equity Database set forth in subsection
22        (c-25).
23            (E) An application for waiver of the minimum
24        equity standards of this subsection, which the Agency
25        shall have the discretion to grant in rare
26        circumstances. The Agency may grant such a waiver

 

 

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1        where the applicant provides evidence of significant
2        efforts toward meeting the minimum equity commitment,
3        including: use of the Energy Workforce Equity
4        Database; efforts to hire or contract with entities
5        that hire eligible persons; and efforts to establish
6        contracting relationships with eligible contractors.
7        The Agency shall support applicants in understanding
8        the Energy Workforce Equity Database and other
9        resources for pursuing compliance of the minimum
10        equity standards. Waivers shall be project-specific,
11        unless the Agency deems it necessary to grant a waiver
12        across a portfolio of projects, and in effect for no
13        longer than one year. Any waiver extension or
14        subsequent waiver request from an applicant shall be
15        subject to the requirements of this Section and shall
16        specify efforts made to reach compliance. When
17        considering whether to grant a waiver, and to what
18        extent, the Agency shall consider the degree to which
19        similarly situated applicants have been able to meet
20        these minimum equity commitments. For repeated waiver
21        requests for specific lack of eligible persons or
22        eligible contractors available, the Agency shall make
23        recommendations to target recruitment to add such
24        eligible persons or eligible contractors to the
25        database.
26        (5) The Agency shall collect information about work on

 

 

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1    projects or portfolios of projects subject to these
2    minimum equity standards to ensure compliance with this
3    subsection (c-10). Reporting in furtherance of this
4    requirement may be combined with other annual reporting
5    requirements. Such reporting shall include proof of
6    certification of each equity eligible contractor or equity
7    eligible person during the applicable time period.
8        (6) The Agency shall keep confidential all information
9    and communication that provides private or personal
10    information.
11        (7) Modifications to the equity accountability system.
12    As part of the update of the long-term renewable resources
13    procurement plan to be initiated in 2023, or sooner if the
14    Agency deems necessary, the Agency shall determine the
15    extent to which the equity accountability system described
16    in this subsection (c-10) has advanced the goals of this
17    amendatory Act of the 102nd General Assembly, including
18    through the inclusion of equity eligible persons and
19    equity eligible contractors in renewable energy credit
20    projects. If the Agency finds that the equity
21    accountability system has failed to meet those goals to
22    its fullest potential, the Agency may revise the following
23    criteria for future Agency procurements: (A) the
24    percentage of project workforce, or other appropriate
25    workforce measure, certified as equity eligible persons or
26    equity eligible contractors; (B) definitions for equity

 

 

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1    investment eligible persons and equity investment eligible
2    community; and (C) such other modifications necessary to
3    advance the goals of this amendatory Act of the 102nd
4    General Assembly effectively. Such revised criteria may
5    also establish distinct equity accountability systems for
6    different types of procurements or different regions of
7    the State if the Agency finds that doing so will further
8    the purposes of such programs. Revisions shall be
9    developed with stakeholder input, including from equity
10    eligible persons, equity eligible contractors, and
11    community-based organizations that work with such persons
12    and contractors.
13    (c-15) Racial discrimination elimination powers and
14process.
15        (1) Purpose. It is the purpose of this subsection to
16    empower the Agency and other State actors to remedy racial
17    discrimination in Illinois' clean energy economy as
18    effectively and expediently as possible, including through
19    the use of race-conscious remedies, such as race-conscious
20    contracting and hiring goals, as consistent with State and
21    federal law.
22        (2) Racial disparity and discrimination review
23    process.
24            (A) Within one year after awarding contracts using
25        the equity actions processes established in this
26        Section, the Agency shall publish a report evaluating

 

 

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1        the effectiveness of the equity actions point criteria
2        of this Section in increasing participation of equity
3        eligible persons and equity eligible contractors. The
4        report shall disaggregate participating workers and
5        contractors by race and ethnicity. The report shall be
6        forwarded to the Governor, the General Assembly, and
7        the Illinois Commerce Commission and be made available
8        to the public.
9            (B) As soon as is practicable thereafter, the
10        Agency, in consultation with the Department of
11        Commerce and Economic Opportunity, Department of
12        Labor, and other agencies that may be relevant, shall
13        commission and publish a disparity and availability
14        study that measures the presence and impact of
15        discrimination on minority businesses and workers in
16        Illinois' clean energy economy. The Agency may hire
17        consultants and experts to conduct the disparity and
18        availability study, with the retention of those
19        consultants and experts exempt from the requirements
20        of Section 20-10 of the Illinois Procurement Code. The
21        Illinois Power Agency shall forward a copy of its
22        findings and recommendations to the Governor, the
23        General Assembly, and the Illinois Commerce
24        Commission. If the disparity and availability study
25        establishes a strong basis in evidence that there is
26        discrimination in Illinois' clean energy economy, the

 

 

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1        Agency, Department of Commerce and Economic
2        Opportunity, Department of Labor, Department of
3        Corrections, and other appropriate agencies shall take
4        appropriate remedial actions, including race-conscious
5        remedial actions as consistent with State and federal
6        law, to effectively remedy this discrimination. Such
7        remedies may include modification of the equity
8        accountability system as described in subsection
9        (c-10).
10    (c-20) Program data collection.
11        (1) Purpose. Data collection, data analysis, and
12    reporting are critical to ensure that the benefits of the
13    clean energy economy provided to Illinois residents and
14    businesses are equitably distributed across the State. The
15    Agency shall collect data from program applicants in order
16    to track and improve equitable distribution of benefits
17    across Illinois communities for all procurements the
18    Agency conducts. The Agency shall use this data to, among
19    other things, measure any potential impact of racial
20    discrimination on the distribution of benefits and provide
21    information necessary to correct any discrimination
22    through methods consistent with State and federal law.
23        (2) Agency collection of program data. The Agency
24    shall collect demographic and geographic data for each
25    entity awarded contracts under any Agency-administered
26    program.

 

 

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1        (3) Required information to be collected. The Agency
2    shall collect the following information from applicants
3    and program participants where applicable:
4            (A) demographic information, including racial or
5        ethnic identity for real persons employed, contracted,
6        or subcontracted through the program and owners of
7        businesses or entities that apply to receive renewable
8        energy credits from the Agency;
9            (B) geographic location of the residency of real
10        persons employed, contracted, or subcontracted through
11        the program and geographic location of the
12        headquarters of the business or entity that applies to
13        receive renewable energy credits from the Agency; and
14            (C) any other information the Agency determines is
15        necessary for the purpose of achieving the purpose of
16        this subsection.
17        (4) Publication of collected information. The Agency
18    shall publish, at least annually, information on the
19    demographics of program participants on an aggregate
20    basis.
21        (5) Nothing in this subsection shall be interpreted to
22    limit the authority of the Agency, or other agency or
23    department of the State, to require or collect demographic
24    information from applicants of other State programs.
25    (c-25) Energy Workforce Equity Database.
26        (1) The Agency, in consultation with the Department of

 

 

HB2563- 115 -LRB103 29504 AMQ 55899 b

1    Commerce and Economic Opportunity, shall create an Energy
2    Workforce Equity Database, and may contract with a third
3    party to do so ("database program administrator"). If the
4    Department decides to contract with a third party, that
5    third party shall be exempt from the requirements of
6    Section 20-10 of the Illinois Procurement Code. The Energy
7    Workforce Equity Database shall be a searchable database
8    of suppliers, vendors, and subcontractors for clean energy
9    industries that is:
10            (A) publicly accessible;
11            (B) easy for people to find and use;
12            (C) organized by company specialty or field;
13            (D) region-specific; and
14            (E) populated with information including, but not
15        limited to, contacts for suppliers, vendors, or
16        subcontractors who are minority and women-owned
17        business enterprise certified or who participate or
18        have participated in any of the programs described in
19        this Act.
20        (2) The Agency shall create an easily accessible,
21    public facing online tool using the database information
22    that includes, at a minimum, the following:
23            (A) a map of environmental justice and equity
24        investment eligible communities;
25            (B) job postings and recruiting opportunities;
26            (C) a means by which recruiting clean energy

 

 

HB2563- 116 -LRB103 29504 AMQ 55899 b

1        companies can find and interact with current or former
2        participants of clean energy workforce training
3        programs;
4            (D) information on workforce training service
5        providers and training opportunities available to
6        prospective workers;
7            (E) renewable energy company diversity reporting;
8            (F) a list of equity eligible contractors with
9        their contact information, types of work performed,
10        and locations worked in;
11            (G) reporting on outcomes of the programs
12        described in the workforce programs of the Energy
13        Transition Act, including information such as, but not
14        limited to, retention rate, graduation rate, and
15        placement rates of trainees; and
16            (H) information about the Jobs and Environmental
17        Justice Grant Program, the Clean Energy Jobs and
18        Justice Fund, and other sources of capital.
19        (3) The Agency shall ensure the database is regularly
20    updated to ensure information is current and shall
21    coordinate with the Department of Commerce and Economic
22    Opportunity to ensure that it includes information on
23    individuals and entities that are or have participated in
24    the Clean Jobs Workforce Network Program, Clean Energy
25    Contractor Incubator Program, Returning Residents Clean
26    Jobs Training Program, or Clean Energy Primes Contractor

 

 

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1    Accelerator Program.
2    (c-30) Enforcement of minimum equity standards. All
3entities seeking renewable energy credits must submit an
4annual report to demonstrate compliance with each of the
5equity commitments required under subsection (c-10). If the
6Agency concludes the entity has not met or maintained its
7minimum equity standards required under the applicable
8subparagraphs under subsection (c-10), the Agency shall deny
9the entity's ability to participate in procurement programs in
10subsection (c), including by withholding approved vendor or
11designee status. The Agency may require the entity to enter
12into a corrective action plan. An entity that is not
13recertified for failing to meet required equity actions in
14subparagraph (c-10) may reapply once they have a corrective
15action plan and achieve compliance with the minimum equity
16standards.
17    (d) Clean coal portfolio standard.
18        (1) The procurement plans shall include electricity
19    generated using clean coal. Each utility shall enter into
20    one or more sourcing agreements with the initial clean
21    coal facility, as provided in paragraph (3) of this
22    subsection (d), covering electricity generated by the
23    initial clean coal facility representing at least 5% of
24    each utility's total supply to serve the load of eligible
25    retail customers in 2015 and each year thereafter, as
26    described in paragraph (3) of this subsection (d), subject

 

 

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1    to the limits specified in paragraph (2) of this
2    subsection (d). It is the goal of the State that by January
3    1, 2025, 25% of the electricity used in the State shall be
4    generated by cost-effective clean coal facilities. For
5    purposes of this subsection (d), "cost-effective" means
6    that the expenditures pursuant to such sourcing agreements
7    do not cause the limit stated in paragraph (2) of this
8    subsection (d) to be exceeded and do not exceed cost-based
9    benchmarks, which shall be developed to assess all
10    expenditures pursuant to such sourcing agreements covering
11    electricity generated by clean coal facilities, other than
12    the initial clean coal facility, by the procurement
13    administrator, in consultation with the Commission staff,
14    Agency staff, and the procurement monitor and shall be
15    subject to Commission review and approval.
16        A utility party to a sourcing agreement shall
17    immediately retire any emission credits that it receives
18    in connection with the electricity covered by such
19    agreement.
20        Utilities shall maintain adequate records documenting
21    the purchases under the sourcing agreement to comply with
22    this subsection (d) and shall file an accounting with the
23    load forecast that must be filed with the Agency by July 15
24    of each year, in accordance with subsection (d) of Section
25    16-111.5 of the Public Utilities Act.
26        A utility shall be deemed to have complied with the

 

 

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1    clean coal portfolio standard specified in this subsection
2    (d) if the utility enters into a sourcing agreement as
3    required by this subsection (d).
4        (2) For purposes of this subsection (d), the required
5    execution of sourcing agreements with the initial clean
6    coal facility for a particular year shall be measured as a
7    percentage of the actual amount of electricity
8    (megawatt-hours) supplied by the electric utility to
9    eligible retail customers in the planning year ending
10    immediately prior to the agreement's execution. For
11    purposes of this subsection (d), the amount paid per
12    kilowatthour means the total amount paid for electric
13    service expressed on a per kilowatthour basis. For
14    purposes of this subsection (d), the total amount paid for
15    electric service includes without limitation amounts paid
16    for supply, transmission, distribution, surcharges and
17    add-on taxes.
18        Notwithstanding the requirements of this subsection
19    (d), the total amount paid under sourcing agreements with
20    clean coal facilities pursuant to the procurement plan for
21    any given year shall be reduced by an amount necessary to
22    limit the annual estimated average net increase due to the
23    costs of these resources included in the amounts paid by
24    eligible retail customers in connection with electric
25    service to:
26            (A) in 2010, no more than 0.5% of the amount paid

 

 

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1        per kilowatthour by those customers during the year
2        ending May 31, 2009;
3            (B) in 2011, the greater of an additional 0.5% of
4        the amount paid per kilowatthour by those customers
5        during the year ending May 31, 2010 or 1% of the amount
6        paid per kilowatthour by those customers during the
7        year ending May 31, 2009;
8            (C) in 2012, the greater of an additional 0.5% of
9        the amount paid per kilowatthour by those customers
10        during the year ending May 31, 2011 or 1.5% of the
11        amount paid per kilowatthour by those customers during
12        the year ending May 31, 2009;
13            (D) in 2013, the greater of an additional 0.5% of
14        the amount paid per kilowatthour by those customers
15        during the year ending May 31, 2012 or 2% of the amount
16        paid per kilowatthour by those customers during the
17        year ending May 31, 2009; and
18            (E) thereafter, the total amount paid under
19        sourcing agreements with clean coal facilities
20        pursuant to the procurement plan for any single year
21        shall be reduced by an amount necessary to limit the
22        estimated average net increase due to the cost of
23        these resources included in the amounts paid by
24        eligible retail customers in connection with electric
25        service to no more than the greater of (i) 2.015% of
26        the amount paid per kilowatthour by those customers

 

 

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1        during the year ending May 31, 2009 or (ii) the
2        incremental amount per kilowatthour paid for these
3        resources in 2013. These requirements may be altered
4        only as provided by statute.
5        No later than June 30, 2015, the Commission shall
6    review the limitation on the total amount paid under
7    sourcing agreements, if any, with clean coal facilities
8    pursuant to this subsection (d) and report to the General
9    Assembly its findings as to whether that limitation unduly
10    constrains the amount of electricity generated by
11    cost-effective clean coal facilities that is covered by
12    sourcing agreements.
13        (3) Initial clean coal facility. In order to promote
14    development of clean coal facilities in Illinois, each
15    electric utility subject to this Section shall execute a
16    sourcing agreement to source electricity from a proposed
17    clean coal facility in Illinois (the "initial clean coal
18    facility") that will have a nameplate capacity of at least
19    500 MW when commercial operation commences, that has a
20    final Clean Air Act permit on June 1, 2009 (the effective
21    date of Public Act 95-1027), and that will meet the
22    definition of clean coal facility in Section 1-10 of this
23    Act when commercial operation commences. The sourcing
24    agreements with this initial clean coal facility shall be
25    subject to both approval of the initial clean coal
26    facility by the General Assembly and satisfaction of the

 

 

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1    requirements of paragraph (4) of this subsection (d) and
2    shall be executed within 90 days after any such approval
3    by the General Assembly. The Agency and the Commission
4    shall have authority to inspect all books and records
5    associated with the initial clean coal facility during the
6    term of such a sourcing agreement. A utility's sourcing
7    agreement for electricity produced by the initial clean
8    coal facility shall include:
9            (A) a formula contractual price (the "contract
10        price") approved pursuant to paragraph (4) of this
11        subsection (d), which shall:
12                (i) be determined using a cost of service
13            methodology employing either a level or deferred
14            capital recovery component, based on a capital
15            structure consisting of 45% equity and 55% debt,
16            and a return on equity as may be approved by the
17            Federal Energy Regulatory Commission, which in any
18            case may not exceed the lower of 11.5% or the rate
19            of return approved by the General Assembly
20            pursuant to paragraph (4) of this subsection (d);
21            and
22                (ii) provide that all miscellaneous net
23            revenue, including but not limited to net revenue
24            from the sale of emission allowances, if any,
25            substitute natural gas, if any, grants or other
26            support provided by the State of Illinois or the

 

 

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1            United States Government, firm transmission
2            rights, if any, by-products produced by the
3            facility, energy or capacity derived from the
4            facility and not covered by a sourcing agreement
5            pursuant to paragraph (3) of this subsection (d)
6            or item (5) of subsection (d) of Section 16-115 of
7            the Public Utilities Act, whether generated from
8            the synthesis gas derived from coal, from SNG, or
9            from natural gas, shall be credited against the
10            revenue requirement for this initial clean coal
11            facility;
12            (B) power purchase provisions, which shall:
13                (i) provide that the utility party to such
14            sourcing agreement shall pay the contract price
15            for electricity delivered under such sourcing
16            agreement;
17                (ii) require delivery of electricity to the
18            regional transmission organization market of the
19            utility that is party to such sourcing agreement;
20                (iii) require the utility party to such
21            sourcing agreement to buy from the initial clean
22            coal facility in each hour an amount of energy
23            equal to all clean coal energy made available from
24            the initial clean coal facility during such hour
25            times a fraction, the numerator of which is such
26            utility's retail market sales of electricity

 

 

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1            (expressed in kilowatthours sold) in the State
2            during the prior calendar month and the
3            denominator of which is the total retail market
4            sales of electricity (expressed in kilowatthours
5            sold) in the State by utilities during such prior
6            month and the sales of electricity (expressed in
7            kilowatthours sold) in the State by alternative
8            retail electric suppliers during such prior month
9            that are subject to the requirements of this
10            subsection (d) and paragraph (5) of subsection (d)
11            of Section 16-115 of the Public Utilities Act,
12            provided that the amount purchased by the utility
13            in any year will be limited by paragraph (2) of
14            this subsection (d); and
15                (iv) be considered pre-existing contracts in
16            such utility's procurement plans for eligible
17            retail customers;
18            (C) contract for differences provisions, which
19        shall:
20                (i) require the utility party to such sourcing
21            agreement to contract with the initial clean coal
22            facility in each hour with respect to an amount of
23            energy equal to all clean coal energy made
24            available from the initial clean coal facility
25            during such hour times a fraction, the numerator
26            of which is such utility's retail market sales of

 

 

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1            electricity (expressed in kilowatthours sold) in
2            the utility's service territory in the State
3            during the prior calendar month and the
4            denominator of which is the total retail market
5            sales of electricity (expressed in kilowatthours
6            sold) in the State by utilities during such prior
7            month and the sales of electricity (expressed in
8            kilowatthours sold) in the State by alternative
9            retail electric suppliers during such prior month
10            that are subject to the requirements of this
11            subsection (d) and paragraph (5) of subsection (d)
12            of Section 16-115 of the Public Utilities Act,
13            provided that the amount paid by the utility in
14            any year will be limited by paragraph (2) of this
15            subsection (d);
16                (ii) provide that the utility's payment
17            obligation in respect of the quantity of
18            electricity determined pursuant to the preceding
19            clause (i) shall be limited to an amount equal to
20            (1) the difference between the contract price
21            determined pursuant to subparagraph (A) of
22            paragraph (3) of this subsection (d) and the
23            day-ahead price for electricity delivered to the
24            regional transmission organization market of the
25            utility that is party to such sourcing agreement
26            (or any successor delivery point at which such

 

 

HB2563- 126 -LRB103 29504 AMQ 55899 b

1            utility's supply obligations are financially
2            settled on an hourly basis) (the "reference
3            price") on the day preceding the day on which the
4            electricity is delivered to the initial clean coal
5            facility busbar, multiplied by (2) the quantity of
6            electricity determined pursuant to the preceding
7            clause (i); and
8                (iii) not require the utility to take physical
9            delivery of the electricity produced by the
10            facility;
11            (D) general provisions, which shall:
12                (i) specify a term of no more than 30 years,
13            commencing on the commercial operation date of the
14            facility;
15                (ii) provide that utilities shall maintain
16            adequate records documenting purchases under the
17            sourcing agreements entered into to comply with
18            this subsection (d) and shall file an accounting
19            with the load forecast that must be filed with the
20            Agency by July 15 of each year, in accordance with
21            subsection (d) of Section 16-111.5 of the Public
22            Utilities Act;
23                (iii) provide that all costs associated with
24            the initial clean coal facility will be
25            periodically reported to the Federal Energy
26            Regulatory Commission and to purchasers in

 

 

HB2563- 127 -LRB103 29504 AMQ 55899 b

1            accordance with applicable laws governing
2            cost-based wholesale power contracts;
3                (iv) permit the Illinois Power Agency to
4            assume ownership of the initial clean coal
5            facility, without monetary consideration and
6            otherwise on reasonable terms acceptable to the
7            Agency, if the Agency so requests no less than 3
8            years prior to the end of the stated contract
9            term;
10                (v) require the owner of the initial clean
11            coal facility to provide documentation to the
12            Commission each year, starting in the facility's
13            first year of commercial operation, accurately
14            reporting the quantity of carbon emissions from
15            the facility that have been captured and
16            sequestered and report any quantities of carbon
17            released from the site or sites at which carbon
18            emissions were sequestered in prior years, based
19            on continuous monitoring of such sites. If, in any
20            year after the first year of commercial operation,
21            the owner of the facility fails to demonstrate
22            that the initial clean coal facility captured and
23            sequestered at least 50% of the total carbon
24            emissions that the facility would otherwise emit
25            or that sequestration of emissions from prior
26            years has failed, resulting in the release of

 

 

HB2563- 128 -LRB103 29504 AMQ 55899 b

1            carbon dioxide into the atmosphere, the owner of
2            the facility must offset excess emissions. Any
3            such carbon offsets must be permanent, additional,
4            verifiable, real, located within the State of
5            Illinois, and legally and practicably enforceable.
6            The cost of such offsets for the facility that are
7            not recoverable shall not exceed $15 million in
8            any given year. No costs of any such purchases of
9            carbon offsets may be recovered from a utility or
10            its customers. All carbon offsets purchased for
11            this purpose and any carbon emission credits
12            associated with sequestration of carbon from the
13            facility must be permanently retired. The initial
14            clean coal facility shall not forfeit its
15            designation as a clean coal facility if the
16            facility fails to fully comply with the applicable
17            carbon sequestration requirements in any given
18            year, provided the requisite offsets are
19            purchased. However, the Attorney General, on
20            behalf of the People of the State of Illinois, may
21            specifically enforce the facility's sequestration
22            requirement and the other terms of this contract
23            provision. Compliance with the sequestration
24            requirements and offset purchase requirements
25            specified in paragraph (3) of this subsection (d)
26            shall be reviewed annually by an independent

 

 

HB2563- 129 -LRB103 29504 AMQ 55899 b

1            expert retained by the owner of the initial clean
2            coal facility, with the advance written approval
3            of the Attorney General. The Commission may, in
4            the course of the review specified in item (vii),
5            reduce the allowable return on equity for the
6            facility if the facility willfully fails to comply
7            with the carbon capture and sequestration
8            requirements set forth in this item (v);
9                (vi) include limits on, and accordingly
10            provide for modification of, the amount the
11            utility is required to source under the sourcing
12            agreement consistent with paragraph (2) of this
13            subsection (d);
14                (vii) require Commission review: (1) to
15            determine the justness, reasonableness, and
16            prudence of the inputs to the formula referenced
17            in subparagraphs (A)(i) through (A)(iii) of
18            paragraph (3) of this subsection (d), prior to an
19            adjustment in those inputs including, without
20            limitation, the capital structure and return on
21            equity, fuel costs, and other operations and
22            maintenance costs and (2) to approve the costs to
23            be passed through to customers under the sourcing
24            agreement by which the utility satisfies its
25            statutory obligations. Commission review shall
26            occur no less than every 3 years, regardless of

 

 

HB2563- 130 -LRB103 29504 AMQ 55899 b

1            whether any adjustments have been proposed, and
2            shall be completed within 9 months;
3                (viii) limit the utility's obligation to such
4            amount as the utility is allowed to recover
5            through tariffs filed with the Commission,
6            provided that neither the clean coal facility nor
7            the utility waives any right to assert federal
8            pre-emption or any other argument in response to a
9            purported disallowance of recovery costs;
10                (ix) limit the utility's or alternative retail
11            electric supplier's obligation to incur any
12            liability until such time as the facility is in
13            commercial operation and generating power and
14            energy and such power and energy is being
15            delivered to the facility busbar;
16                (x) provide that the owner or owners of the
17            initial clean coal facility, which is the
18            counterparty to such sourcing agreement, shall
19            have the right from time to time to elect whether
20            the obligations of the utility party thereto shall
21            be governed by the power purchase provisions or
22            the contract for differences provisions;
23                (xi) append documentation showing that the
24            formula rate and contract, insofar as they relate
25            to the power purchase provisions, have been
26            approved by the Federal Energy Regulatory

 

 

HB2563- 131 -LRB103 29504 AMQ 55899 b

1            Commission pursuant to Section 205 of the Federal
2            Power Act;
3                (xii) provide that any changes to the terms of
4            the contract, insofar as such changes relate to
5            the power purchase provisions, are subject to
6            review under the public interest standard applied
7            by the Federal Energy Regulatory Commission
8            pursuant to Sections 205 and 206 of the Federal
9            Power Act; and
10                (xiii) conform with customary lender
11            requirements in power purchase agreements used as
12            the basis for financing non-utility generators.
13        (4) Effective date of sourcing agreements with the
14    initial clean coal facility. Any proposed sourcing
15    agreement with the initial clean coal facility shall not
16    become effective unless the following reports are prepared
17    and submitted and authorizations and approvals obtained:
18            (i) Facility cost report. The owner of the initial
19        clean coal facility shall submit to the Commission,
20        the Agency, and the General Assembly a front-end
21        engineering and design study, a facility cost report,
22        method of financing (including but not limited to
23        structure and associated costs), and an operating and
24        maintenance cost quote for the facility (collectively
25        "facility cost report"), which shall be prepared in
26        accordance with the requirements of this paragraph (4)

 

 

HB2563- 132 -LRB103 29504 AMQ 55899 b

1        of subsection (d) of this Section, and shall provide
2        the Commission and the Agency access to the work
3        papers, relied upon documents, and any other backup
4        documentation related to the facility cost report.
5            (ii) Commission report. Within 6 months following
6        receipt of the facility cost report, the Commission,
7        in consultation with the Agency, shall submit a report
8        to the General Assembly setting forth its analysis of
9        the facility cost report. Such report shall include,
10        but not be limited to, a comparison of the costs
11        associated with electricity generated by the initial
12        clean coal facility to the costs associated with
13        electricity generated by other types of generation
14        facilities, an analysis of the rate impacts on
15        residential and small business customers over the life
16        of the sourcing agreements, and an analysis of the
17        likelihood that the initial clean coal facility will
18        commence commercial operation by and be delivering
19        power to the facility's busbar by 2016. To assist in
20        the preparation of its report, the Commission, in
21        consultation with the Agency, may hire one or more
22        experts or consultants, the costs of which shall be
23        paid for by the owner of the initial clean coal
24        facility. The Commission and Agency may begin the
25        process of selecting such experts or consultants prior
26        to receipt of the facility cost report.

 

 

HB2563- 133 -LRB103 29504 AMQ 55899 b

1            (iii) General Assembly approval. The proposed
2        sourcing agreements shall not take effect unless,
3        based on the facility cost report and the Commission's
4        report, the General Assembly enacts authorizing
5        legislation approving (A) the projected price, stated
6        in cents per kilowatthour, to be charged for
7        electricity generated by the initial clean coal
8        facility, (B) the projected impact on residential and
9        small business customers' bills over the life of the
10        sourcing agreements, and (C) the maximum allowable
11        return on equity for the project; and
12            (iv) Commission review. If the General Assembly
13        enacts authorizing legislation pursuant to
14        subparagraph (iii) approving a sourcing agreement, the
15        Commission shall, within 90 days of such enactment,
16        complete a review of such sourcing agreement. During
17        such time period, the Commission shall implement any
18        directive of the General Assembly, resolve any
19        disputes between the parties to the sourcing agreement
20        concerning the terms of such agreement, approve the
21        form of such agreement, and issue an order finding
22        that the sourcing agreement is prudent and reasonable.
23        The facility cost report shall be prepared as follows:
24            (A) The facility cost report shall be prepared by
25        duly licensed engineering and construction firms
26        detailing the estimated capital costs payable to one

 

 

HB2563- 134 -LRB103 29504 AMQ 55899 b

1        or more contractors or suppliers for the engineering,
2        procurement and construction of the components
3        comprising the initial clean coal facility and the
4        estimated costs of operation and maintenance of the
5        facility. The facility cost report shall include:
6                (i) an estimate of the capital cost of the
7            core plant based on one or more front end
8            engineering and design studies for the
9            gasification island and related facilities. The
10            core plant shall include all civil, structural,
11            mechanical, electrical, control, and safety
12            systems.
13                (ii) an estimate of the capital cost of the
14            balance of the plant, including any capital costs
15            associated with sequestration of carbon dioxide
16            emissions and all interconnects and interfaces
17            required to operate the facility, such as
18            transmission of electricity, construction or
19            backfeed power supply, pipelines to transport
20            substitute natural gas or carbon dioxide, potable
21            water supply, natural gas supply, water supply,
22            water discharge, landfill, access roads, and coal
23            delivery.
24            The quoted construction costs shall be expressed
25        in nominal dollars as of the date that the quote is
26        prepared and shall include capitalized financing costs

 

 

HB2563- 135 -LRB103 29504 AMQ 55899 b

1        during construction, taxes, insurance, and other
2        owner's costs, and an assumed escalation in materials
3        and labor beyond the date as of which the construction
4        cost quote is expressed.
5            (B) The front end engineering and design study for
6        the gasification island and the cost study for the
7        balance of plant shall include sufficient design work
8        to permit quantification of major categories of
9        materials, commodities and labor hours, and receipt of
10        quotes from vendors of major equipment required to
11        construct and operate the clean coal facility.
12            (C) The facility cost report shall also include an
13        operating and maintenance cost quote that will provide
14        the estimated cost of delivered fuel, personnel,
15        maintenance contracts, chemicals, catalysts,
16        consumables, spares, and other fixed and variable
17        operations and maintenance costs. The delivered fuel
18        cost estimate will be provided by a recognized third
19        party expert or experts in the fuel and transportation
20        industries. The balance of the operating and
21        maintenance cost quote, excluding delivered fuel
22        costs, will be developed based on the inputs provided
23        by duly licensed engineering and construction firms
24        performing the construction cost quote, potential
25        vendors under long-term service agreements and plant
26        operating agreements, or recognized third party plant

 

 

HB2563- 136 -LRB103 29504 AMQ 55899 b

1        operator or operators.
2            The operating and maintenance cost quote
3        (including the cost of the front end engineering and
4        design study) shall be expressed in nominal dollars as
5        of the date that the quote is prepared and shall
6        include taxes, insurance, and other owner's costs, and
7        an assumed escalation in materials and labor beyond
8        the date as of which the operating and maintenance
9        cost quote is expressed.
10            (D) The facility cost report shall also include an
11        analysis of the initial clean coal facility's ability
12        to deliver power and energy into the applicable
13        regional transmission organization markets and an
14        analysis of the expected capacity factor for the
15        initial clean coal facility.
16            (E) Amounts paid to third parties unrelated to the
17        owner or owners of the initial clean coal facility to
18        prepare the core plant construction cost quote,
19        including the front end engineering and design study,
20        and the operating and maintenance cost quote will be
21        reimbursed through Coal Development Bonds.
22        (5) Re-powering and retrofitting coal-fired power
23    plants previously owned by Illinois utilities to qualify
24    as clean coal facilities. During the 2009 procurement
25    planning process and thereafter, the Agency and the
26    Commission shall consider sourcing agreements covering

 

 

HB2563- 137 -LRB103 29504 AMQ 55899 b

1    electricity generated by power plants that were previously
2    owned by Illinois utilities and that have been or will be
3    converted into clean coal facilities, as defined by
4    Section 1-10 of this Act. Pursuant to such procurement
5    planning process, the owners of such facilities may
6    propose to the Agency sourcing agreements with utilities
7    and alternative retail electric suppliers required to
8    comply with subsection (d) of this Section and item (5) of
9    subsection (d) of Section 16-115 of the Public Utilities
10    Act, covering electricity generated by such facilities. In
11    the case of sourcing agreements that are power purchase
12    agreements, the contract price for electricity sales shall
13    be established on a cost of service basis. In the case of
14    sourcing agreements that are contracts for differences,
15    the contract price from which the reference price is
16    subtracted shall be established on a cost of service
17    basis. The Agency and the Commission may approve any such
18    utility sourcing agreements that do not exceed cost-based
19    benchmarks developed by the procurement administrator, in
20    consultation with the Commission staff, Agency staff and
21    the procurement monitor, subject to Commission review and
22    approval. The Commission shall have authority to inspect
23    all books and records associated with these clean coal
24    facilities during the term of any such contract.
25        (6) Costs incurred under this subsection (d) or
26    pursuant to a contract entered into under this subsection

 

 

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1    (d) shall be deemed prudently incurred and reasonable in
2    amount and the electric utility shall be entitled to full
3    cost recovery pursuant to the tariffs filed with the
4    Commission.
5    (d-5) Zero emission standard.
6        (1) Beginning with the delivery year commencing on
7    June 1, 2017, the Agency shall, for electric utilities
8    that serve at least 100,000 retail customers in this
9    State, procure contracts with zero emission facilities
10    that are reasonably capable of generating cost-effective
11    zero emission credits in an amount approximately equal to
12    16% of the actual amount of electricity delivered by each
13    electric utility to retail customers in the State during
14    calendar year 2014. For an electric utility serving fewer
15    than 100,000 retail customers in this State that
16    requested, under Section 16-111.5 of the Public Utilities
17    Act, that the Agency procure power and energy for all or a
18    portion of the utility's Illinois load for the delivery
19    year commencing June 1, 2016, the Agency shall procure
20    contracts with zero emission facilities that are
21    reasonably capable of generating cost-effective zero
22    emission credits in an amount approximately equal to 16%
23    of the portion of power and energy to be procured by the
24    Agency for the utility. The duration of the contracts
25    procured under this subsection (d-5) shall be for a term
26    of 10 years ending May 31, 2027. The quantity of zero

 

 

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1    emission credits to be procured under the contracts shall
2    be all of the zero emission credits generated by the zero
3    emission facility in each delivery year; however, if the
4    zero emission facility is owned by more than one entity,
5    then the quantity of zero emission credits to be procured
6    under the contracts shall be the amount of zero emission
7    credits that are generated from the portion of the zero
8    emission facility that is owned by the winning supplier.
9        The 16% value identified in this paragraph (1) is the
10    average of the percentage targets in subparagraph (B) of
11    paragraph (1) of subsection (c) of this Section for the 5
12    delivery years beginning June 1, 2017.
13        The procurement process shall be subject to the
14    following provisions:
15            (A) Those zero emission facilities that intend to
16        participate in the procurement shall submit to the
17        Agency the following eligibility information for each
18        zero emission facility on or before the date
19        established by the Agency:
20                (i) the in-service date and remaining useful
21            life of the zero emission facility;
22                (ii) the amount of power generated annually
23            for each of the years 2005 through 2015, and the
24            projected zero emission credits to be generated
25            over the remaining useful life of the zero
26            emission facility, which shall be used to

 

 

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1            determine the capability of each facility;
2                (iii) the annual zero emission facility cost
3            projections, expressed on a per megawatthour
4            basis, over the next 6 delivery years, which shall
5            include the following: operation and maintenance
6            expenses; fully allocated overhead costs, which
7            shall be allocated using the methodology developed
8            by the Institute for Nuclear Power Operations;
9            fuel expenditures; non-fuel capital expenditures;
10            spent fuel expenditures; a return on working
11            capital; the cost of operational and market risks
12            that could be avoided by ceasing operation; and
13            any other costs necessary for continued
14            operations, provided that "necessary" means, for
15            purposes of this item (iii), that the costs could
16            reasonably be avoided only by ceasing operations
17            of the zero emission facility; and
18                (iv) a commitment to continue operating, for
19            the duration of the contract or contracts executed
20            under the procurement held under this subsection
21            (d-5), the zero emission facility that produces
22            the zero emission credits to be procured in the
23            procurement.
24            The information described in item (iii) of this
25        subparagraph (A) may be submitted on a confidential
26        basis and shall be treated and maintained by the

 

 

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1        Agency, the procurement administrator, and the
2        Commission as confidential and proprietary and exempt
3        from disclosure under subparagraphs (a) and (g) of
4        paragraph (1) of Section 7 of the Freedom of
5        Information Act. The Office of Attorney General shall
6        have access to, and maintain the confidentiality of,
7        such information pursuant to Section 6.5 of the
8        Attorney General Act.
9            (B) The price for each zero emission credit
10        procured under this subsection (d-5) for each delivery
11        year shall be in an amount that equals the Social Cost
12        of Carbon, expressed on a price per megawatthour
13        basis. However, to ensure that the procurement remains
14        affordable to retail customers in this State if
15        electricity prices increase, the price in an
16        applicable delivery year shall be reduced below the
17        Social Cost of Carbon by the amount ("Price
18        Adjustment") by which the market price index for the
19        applicable delivery year exceeds the baseline market
20        price index for the consecutive 12-month period ending
21        May 31, 2016. If the Price Adjustment is greater than
22        or equal to the Social Cost of Carbon in an applicable
23        delivery year, then no payments shall be due in that
24        delivery year. The components of this calculation are
25        defined as follows:
26                (i) Social Cost of Carbon: The Social Cost of

 

 

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1            Carbon is $16.50 per megawatthour, which is based
2            on the U.S. Interagency Working Group on Social
3            Cost of Carbon's price in the August 2016
4            Technical Update using a 3% discount rate,
5            adjusted for inflation for each year of the
6            program. Beginning with the delivery year
7            commencing June 1, 2023, the price per
8            megawatthour shall increase by $1 per
9            megawatthour, and continue to increase by an
10            additional $1 per megawatthour each delivery year
11            thereafter.
12                (ii) Baseline market price index: The baseline
13            market price index for the consecutive 12-month
14            period ending May 31, 2016 is $31.40 per
15            megawatthour, which is based on the sum of (aa)
16            the average day-ahead energy price across all
17            hours of such 12-month period at the PJM
18            Interconnection LLC Northern Illinois Hub, (bb)
19            50% multiplied by the Base Residual Auction, or
20            its successor, capacity price for the rest of the
21            RTO zone group determined by PJM Interconnection
22            LLC, divided by 24 hours per day, and (cc) 50%
23            multiplied by the Planning Resource Auction, or
24            its successor, capacity price for Zone 4
25            determined by the Midcontinent Independent System
26            Operator, Inc., divided by 24 hours per day.

 

 

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1                (iii) Market price index: The market price
2            index for a delivery year shall be the sum of
3            projected energy prices and projected capacity
4            prices determined as follows:
5                    (aa) Projected energy prices: the
6                projected energy prices for the applicable
7                delivery year shall be calculated once for the
8                year using the forward market price for the
9                PJM Interconnection, LLC Northern Illinois
10                Hub. The forward market price shall be
11                calculated as follows: the energy forward
12                prices for each month of the applicable
13                delivery year averaged for each trade date
14                during the calendar year immediately preceding
15                that delivery year to produce a single energy
16                forward price for the delivery year. The
17                forward market price calculation shall use
18                data published by the Intercontinental
19                Exchange, or its successor.
20                    (bb) Projected capacity prices:
21                        (I) For the delivery years commencing
22                    June 1, 2017, June 1, 2018, and June 1,
23                    2019, the projected capacity price shall
24                    be equal to the sum of (1) 50% multiplied
25                    by the Base Residual Auction, or its
26                    successor, price for the rest of the RTO

 

 

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1                    zone group as determined by PJM
2                    Interconnection LLC, divided by 24 hours
3                    per day and, (2) 50% multiplied by the
4                    resource auction price determined in the
5                    resource auction administered by the
6                    Midcontinent Independent System Operator,
7                    Inc., in which the largest percentage of
8                    load cleared for Local Resource Zone 4,
9                    divided by 24 hours per day, and where
10                    such price is determined by the
11                    Midcontinent Independent System Operator,
12                    Inc.
13                        (II) For the delivery year commencing
14                    June 1, 2020, and each year thereafter,
15                    the projected capacity price shall be
16                    equal to the sum of (1) 50% multiplied by
17                    the Base Residual Auction, or its
18                    successor, price for the ComEd zone as
19                    determined by PJM Interconnection LLC,
20                    divided by 24 hours per day, and (2) 50%
21                    multiplied by the resource auction price
22                    determined in the resource auction
23                    administered by the Midcontinent
24                    Independent System Operator, Inc., in
25                    which the largest percentage of load
26                    cleared for Local Resource Zone 4, divided

 

 

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1                    by 24 hours per day, and where such price
2                    is determined by the Midcontinent
3                    Independent System Operator, Inc.
4            For purposes of this subsection (d-5):
5                "Rest of the RTO" and "ComEd Zone" shall have
6            the meaning ascribed to them by PJM
7            Interconnection, LLC.
8                "RTO" means regional transmission
9            organization.
10            (C) No later than 45 days after June 1, 2017 (the
11        effective date of Public Act 99-906), the Agency shall
12        publish its proposed zero emission standard
13        procurement plan. The plan shall be consistent with
14        the provisions of this paragraph (1) and shall provide
15        that winning bids shall be selected based on public
16        interest criteria that include, but are not limited
17        to, minimizing carbon dioxide emissions that result
18        from electricity consumed in Illinois and minimizing
19        sulfur dioxide, nitrogen oxide, and particulate matter
20        emissions that adversely affect the citizens of this
21        State. In particular, the selection of winning bids
22        shall take into account the incremental environmental
23        benefits resulting from the procurement, such as any
24        existing environmental benefits that are preserved by
25        the procurements held under Public Act 99-906 and
26        would cease to exist if the procurements were not

 

 

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1        held, including the preservation of zero emission
2        facilities. The plan shall also describe in detail how
3        each public interest factor shall be considered and
4        weighted in the bid selection process to ensure that
5        the public interest criteria are applied to the
6        procurement and given full effect.
7            For purposes of developing the plan, the Agency
8        shall consider any reports issued by a State agency,
9        board, or commission under House Resolution 1146 of
10        the 98th General Assembly and paragraph (4) of
11        subsection (d) of this Section, as well as publicly
12        available analyses and studies performed by or for
13        regional transmission organizations that serve the
14        State and their independent market monitors.
15            Upon publishing of the zero emission standard
16        procurement plan, copies of the plan shall be posted
17        and made publicly available on the Agency's website.
18        All interested parties shall have 10 days following
19        the date of posting to provide comment to the Agency on
20        the plan. All comments shall be posted to the Agency's
21        website. Following the end of the comment period, but
22        no more than 60 days later than June 1, 2017 (the
23        effective date of Public Act 99-906), the Agency shall
24        revise the plan as necessary based on the comments
25        received and file its zero emission standard
26        procurement plan with the Commission.

 

 

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1            If the Commission determines that the plan will
2        result in the procurement of cost-effective zero
3        emission credits, then the Commission shall, after
4        notice and hearing, but no later than 45 days after the
5        Agency filed the plan, approve the plan or approve
6        with modification. For purposes of this subsection
7        (d-5), "cost effective" means the projected costs of
8        procuring zero emission credits from zero emission
9        facilities do not cause the limit stated in paragraph
10        (2) of this subsection to be exceeded.
11            (C-5) As part of the Commission's review and
12        acceptance or rejection of the procurement results,
13        the Commission shall, in its public notice of
14        successful bidders:
15                (i) identify how the winning bids satisfy the
16            public interest criteria described in subparagraph
17            (C) of this paragraph (1) of minimizing carbon
18            dioxide emissions that result from electricity
19            consumed in Illinois and minimizing sulfur
20            dioxide, nitrogen oxide, and particulate matter
21            emissions that adversely affect the citizens of
22            this State;
23                (ii) specifically address how the selection of
24            winning bids takes into account the incremental
25            environmental benefits resulting from the
26            procurement, including any existing environmental

 

 

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1            benefits that are preserved by the procurements
2            held under Public Act 99-906 and would have ceased
3            to exist if the procurements had not been held,
4            such as the preservation of zero emission
5            facilities;
6                (iii) quantify the environmental benefit of
7            preserving the resources identified in item (ii)
8            of this subparagraph (C-5), including the
9            following:
10                    (aa) the value of avoided greenhouse gas
11                emissions measured as the product of the zero
12                emission facilities' output over the contract
13                term multiplied by the U.S. Environmental
14                Protection Agency eGrid subregion carbon
15                dioxide emission rate and the U.S. Interagency
16                Working Group on Social Cost of Carbon's price
17                in the August 2016 Technical Update using a 3%
18                discount rate, adjusted for inflation for each
19                delivery year; and
20                    (bb) the costs of replacement with other
21                zero carbon dioxide resources, including wind
22                and photovoltaic, based upon the simple
23                average of the following:
24                        (I) the price, or if there is more
25                    than one price, the average of the prices,
26                    paid for renewable energy credits from new

 

 

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1                    utility-scale wind projects in the
2                    procurement events specified in item (i)
3                    of subparagraph (G) of paragraph (1) of
4                    subsection (c) of this Section; and
5                        (II) the price, or if there is more
6                    than one price, the average of the prices,
7                    paid for renewable energy credits from new
8                    utility-scale solar projects and
9                    brownfield site photovoltaic projects in
10                    the procurement events specified in item
11                    (ii) of subparagraph (G) of paragraph (1)
12                    of subsection (c) of this Section and,
13                    after January 1, 2015, renewable energy
14                    credits from photovoltaic distributed
15                    generation projects in procurement events
16                    held under subsection (c) of this Section.
17            Each utility shall enter into binding contractual
18        arrangements with the winning suppliers.
19            The procurement described in this subsection
20        (d-5), including, but not limited to, the execution of
21        all contracts procured, shall be completed no later
22        than May 10, 2017. Based on the effective date of
23        Public Act 99-906, the Agency and Commission may, as
24        appropriate, modify the various dates and timelines
25        under this subparagraph and subparagraphs (C) and (D)
26        of this paragraph (1). The procurement and plan

 

 

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1        approval processes required by this subsection (d-5)
2        shall be conducted in conjunction with the procurement
3        and plan approval processes required by subsection (c)
4        of this Section and Section 16-111.5 of the Public
5        Utilities Act, to the extent practicable.
6        Notwithstanding whether a procurement event is
7        conducted under Section 16-111.5 of the Public
8        Utilities Act, the Agency shall immediately initiate a
9        procurement process on June 1, 2017 (the effective
10        date of Public Act 99-906).
11            (D) Following the procurement event described in
12        this paragraph (1) and consistent with subparagraph
13        (B) of this paragraph (1), the Agency shall calculate
14        the payments to be made under each contract for the
15        next delivery year based on the market price index for
16        that delivery year. The Agency shall publish the
17        payment calculations no later than May 25, 2017 and
18        every May 25 thereafter.
19            (E) Notwithstanding the requirements of this
20        subsection (d-5), the contracts executed under this
21        subsection (d-5) shall provide that the zero emission
22        facility may, as applicable, suspend or terminate
23        performance under the contracts in the following
24        instances:
25                (i) A zero emission facility shall be excused
26            from its performance under the contract for any

 

 

HB2563- 151 -LRB103 29504 AMQ 55899 b

1            cause beyond the control of the resource,
2            including, but not restricted to, acts of God,
3            flood, drought, earthquake, storm, fire,
4            lightning, epidemic, war, riot, civil disturbance
5            or disobedience, labor dispute, labor or material
6            shortage, sabotage, acts of public enemy,
7            explosions, orders, regulations or restrictions
8            imposed by governmental, military, or lawfully
9            established civilian authorities, which, in any of
10            the foregoing cases, by exercise of commercially
11            reasonable efforts the zero emission facility
12            could not reasonably have been expected to avoid,
13            and which, by the exercise of commercially
14            reasonable efforts, it has been unable to
15            overcome. In such event, the zero emission
16            facility shall be excused from performance for the
17            duration of the event, including, but not limited
18            to, delivery of zero emission credits, and no
19            payment shall be due to the zero emission facility
20            during the duration of the event.
21                (ii) A zero emission facility shall be
22            permitted to terminate the contract if legislation
23            is enacted into law by the General Assembly that
24            imposes or authorizes a new tax, special
25            assessment, or fee on the generation of
26            electricity, the ownership or leasehold of a

 

 

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1            generating unit, or the privilege or occupation of
2            such generation, ownership, or leasehold of
3            generation units by a zero emission facility.
4            However, the provisions of this item (ii) do not
5            apply to any generally applicable tax, special
6            assessment or fee, or requirements imposed by
7            federal law.
8                (iii) A zero emission facility shall be
9            permitted to terminate the contract in the event
10            that the resource requires capital expenditures in
11            excess of $40,000,000 that were neither known nor
12            reasonably foreseeable at the time it executed the
13            contract and that a prudent owner or operator of
14            such resource would not undertake.
15                (iv) A zero emission facility shall be
16            permitted to terminate the contract in the event
17            the Nuclear Regulatory Commission terminates the
18            resource's license.
19            (F) If the zero emission facility elects to
20        terminate a contract under subparagraph (E) of this
21        paragraph (1), then the Commission shall reopen the
22        docket in which the Commission approved the zero
23        emission standard procurement plan under subparagraph
24        (C) of this paragraph (1) and, after notice and
25        hearing, enter an order acknowledging the contract
26        termination election if such termination is consistent

 

 

HB2563- 153 -LRB103 29504 AMQ 55899 b

1        with the provisions of this subsection (d-5).
2        (2) For purposes of this subsection (d-5), the amount
3    paid per kilowatthour means the total amount paid for
4    electric service expressed on a per kilowatthour basis.
5    For purposes of this subsection (d-5), the total amount
6    paid for electric service includes, without limitation,
7    amounts paid for supply, transmission, distribution,
8    surcharges, and add-on taxes.
9        Notwithstanding the requirements of this subsection
10    (d-5), the contracts executed under this subsection (d-5)
11    shall provide that the total of zero emission credits
12    procured under a procurement plan shall be subject to the
13    limitations of this paragraph (2). For each delivery year,
14    the contractual volume receiving payments in such year
15    shall be reduced for all retail customers based on the
16    amount necessary to limit the net increase that delivery
17    year to the costs of those credits included in the amounts
18    paid by eligible retail customers in connection with
19    electric service to no more than 1.65% of the amount paid
20    per kilowatthour by eligible retail customers during the
21    year ending May 31, 2009. The result of this computation
22    shall apply to and reduce the procurement for all retail
23    customers, and all those customers shall pay the same
24    single, uniform cents per kilowatthour charge under
25    subsection (k) of Section 16-108 of the Public Utilities
26    Act. To arrive at a maximum dollar amount of zero emission

 

 

HB2563- 154 -LRB103 29504 AMQ 55899 b

1    credits to be paid for the particular delivery year, the
2    resulting per kilowatthour amount shall be applied to the
3    actual amount of kilowatthours of electricity delivered by
4    the electric utility in the delivery year immediately
5    prior to the procurement, to all retail customers in its
6    service territory. Unpaid contractual volume for any
7    delivery year shall be paid in any subsequent delivery
8    year in which such payments can be made without exceeding
9    the amount specified in this paragraph (2). The
10    calculations required by this paragraph (2) shall be made
11    only once for each procurement plan year. Once the
12    determination as to the amount of zero emission credits to
13    be paid is made based on the calculations set forth in this
14    paragraph (2), no subsequent rate impact determinations
15    shall be made and no adjustments to those contract amounts
16    shall be allowed. All costs incurred under those contracts
17    and in implementing this subsection (d-5) shall be
18    recovered by the electric utility as provided in this
19    Section.
20        No later than June 30, 2019, the Commission shall
21    review the limitation on the amount of zero emission
22    credits procured under this subsection (d-5) and report to
23    the General Assembly its findings as to whether that
24    limitation unduly constrains the procurement of
25    cost-effective zero emission credits.
26        (3) Six years after the execution of a contract under

 

 

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1    this subsection (d-5), the Agency shall determine whether
2    the actual zero emission credit payments received by the
3    supplier over the 6-year period exceed the Average ZEC
4    Payment. In addition, at the end of the term of a contract
5    executed under this subsection (d-5), or at the time, if
6    any, a zero emission facility's contract is terminated
7    under subparagraph (E) of paragraph (1) of this subsection
8    (d-5), then the Agency shall determine whether the actual
9    zero emission credit payments received by the supplier
10    over the term of the contract exceed the Average ZEC
11    Payment, after taking into account any amounts previously
12    credited back to the utility under this paragraph (3). If
13    the Agency determines that the actual zero emission credit
14    payments received by the supplier over the relevant period
15    exceed the Average ZEC Payment, then the supplier shall
16    credit the difference back to the utility. The amount of
17    the credit shall be remitted to the applicable electric
18    utility no later than 120 days after the Agency's
19    determination, which the utility shall reflect as a credit
20    on its retail customer bills as soon as practicable;
21    however, the credit remitted to the utility shall not
22    exceed the total amount of payments received by the
23    facility under its contract.
24        For purposes of this Section, the Average ZEC Payment
25    shall be calculated by multiplying the quantity of zero
26    emission credits delivered under the contract times the

 

 

HB2563- 156 -LRB103 29504 AMQ 55899 b

1    average contract price. The average contract price shall
2    be determined by subtracting the amount calculated under
3    subparagraph (B) of this paragraph (3) from the amount
4    calculated under subparagraph (A) of this paragraph (3),
5    as follows:
6            (A) The average of the Social Cost of Carbon, as
7        defined in subparagraph (B) of paragraph (1) of this
8        subsection (d-5), during the term of the contract.
9            (B) The average of the market price indices, as
10        defined in subparagraph (B) of paragraph (1) of this
11        subsection (d-5), during the term of the contract,
12        minus the baseline market price index, as defined in
13        subparagraph (B) of paragraph (1) of this subsection
14        (d-5).
15        If the subtraction yields a negative number, then the
16    Average ZEC Payment shall be zero.
17        (4) Cost-effective zero emission credits procured from
18    zero emission facilities shall satisfy the applicable
19    definitions set forth in Section 1-10 of this Act.
20        (5) The electric utility shall retire all zero
21    emission credits used to comply with the requirements of
22    this subsection (d-5).
23        (6) Electric utilities shall be entitled to recover
24    all of the costs associated with the procurement of zero
25    emission credits through an automatic adjustment clause
26    tariff in accordance with subsection (k) and (m) of

 

 

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1    Section 16-108 of the Public Utilities Act, and the
2    contracts executed under this subsection (d-5) shall
3    provide that the utilities' payment obligations under such
4    contracts shall be reduced if an adjustment is required
5    under subsection (m) of Section 16-108 of the Public
6    Utilities Act.
7        (7) This subsection (d-5) shall become inoperative on
8    January 1, 2028.
9    (d-10) Nuclear Plant Assistance; carbon mitigation
10credits.
11    (1) The General Assembly finds:
12        (A) The health, welfare, and prosperity of all
13    Illinois citizens require that the State of Illinois act
14    to avoid and not increase carbon emissions from electric
15    generation sources while continuing to ensure affordable,
16    stable, and reliable electricity to all citizens.
17        (B) Absent immediate action by the State to preserve
18    existing carbon-free energy resources, those resources may
19    retire, and the electric generation needs of Illinois'
20    retail customers may be met instead by facilities that
21    emit significant amounts of carbon pollution and other
22    harmful air pollutants at a high social and economic cost
23    until Illinois is able to develop other forms of clean
24    energy.
25        (C) The General Assembly finds that nuclear power
26    generation is necessary for the State's transition to 100%

 

 

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1    clean energy, and ensuring continued operation of nuclear
2    plants advances environmental and public health interests
3    through providing carbon-free electricity while reducing
4    the air pollution profile of the Illinois energy
5    generation fleet.
6        (D) The clean energy attributes of nuclear generation
7    facilities support the State in its efforts to achieve
8    100% clean energy.
9        (E) The State currently invests in various forms of
10    clean energy, including, but not limited to, renewable
11    energy, energy efficiency, and low-emission vehicles,
12    among others.
13        (F) The Environmental Protection Agency commissioned
14    an independent audit which provided a detailed assessment
15    of the financial condition of the Illinois nuclear fleet
16    to evaluate its financial viability and whether the
17    environmental benefits of such resources were at risk. The
18    report identified the risk of losing the environmental
19    benefits of several specific nuclear units. The report
20    also identified that the LaSalle County Generating Station
21    will continue to operate through 2026 and therefore is not
22    eligible to participate in the carbon mitigation credit
23    program.
24        (G) Nuclear plants provide carbon-free energy, which
25    helps to avoid many health-related negative impacts for
26    Illinois residents.

 

 

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1        (H) The procurement of carbon mitigation credits
2    representing the environmental benefits of carbon-free
3    generation will further the State's efforts at achieving
4    100% clean energy and decarbonizing the electricity sector
5    in a safe, reliable, and affordable manner. Further, the
6    procurement of carbon emission credits will enhance the
7    health and welfare of Illinois residents through decreased
8    reliance on more highly polluting generation.
9        (I) The General Assembly therefore finds it necessary
10    to establish carbon mitigation credits to ensure decreased
11    reliance on more carbon-intensive energy resources, for
12    transitioning to a fully decarbonized electricity sector,
13    and to help ensure health and welfare of the State's
14    residents.
15    (2) As used in this subsection:
16    "Baseline costs" means costs used to establish a customer
17protection cap that have been evaluated through an independent
18audit of a carbon-free energy resource conducted by the
19Environmental Protection Agency that evaluated projected
20annual costs for operation and maintenance expenses; fully
21allocated overhead costs, which shall be allocated using the
22methodology developed by the Institute for Nuclear Power
23Operations; fuel expenditures; nonfuel capital expenditures;
24spent fuel expenditures; a return on working capital; the cost
25of operational and market risks that could be avoided by
26ceasing operation; and any other costs necessary for continued

 

 

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1operations, provided that "necessary" means, for purposes of
2this definition, that the costs could reasonably be avoided
3only by ceasing operations of the carbon-free energy resource.
4    "Carbon mitigation credit" means a tradable credit that
5represents the carbon emission reduction attributes of one
6megawatt-hour of energy produced from a carbon-free energy
7resource.
8    "Carbon-free energy resource" means a generation facility
9that: (1) is fueled by nuclear power; and (2) is
10interconnected to PJM Interconnection, LLC.
11    (3) Procurement.
12        (A) Beginning with the delivery year commencing on
13    June 1, 2022, the Agency shall, for electric utilities
14    serving at least 3,000,000 retail customers in the State,
15    seek to procure contracts for no more than approximately
16    54,500,000 cost-effective carbon mitigation credits from
17    carbon-free energy resources because such credits are
18    necessary to support current levels of carbon-free energy
19    generation and ensure the State meets its carbon dioxide
20    emissions reduction goals. The Agency shall not make a
21    partial award of a contract for carbon mitigation credits
22    covering a fractional amount of a carbon-free energy
23    resource's projected output.
24        (B) Each carbon-free energy resource that intends to
25    participate in a procurement shall be required to submit
26    to the Agency the following information for the resource

 

 

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1    on or before the date established by the Agency:
2            (i) the in-service date and remaining useful life
3        of the carbon-free energy resource;
4            (ii) the amount of power generated annually for
5        each of the past 10 years, which shall be used to
6        determine the capability of each facility;
7            (iii) a commitment to be reflected in any contract
8        entered into pursuant to this subsection (d-10) to
9        continue operating the carbon-free energy resource at
10        a capacity factor of at least 88% annually on average
11        for the duration of the contract or contracts executed
12        under the procurement held under this subsection
13        (d-10), except in an instance described in
14        subparagraph (E) of paragraph (1) of subsection (d-5)
15        of this Section or made impracticable as a result of
16        compliance with law or regulation;
17            (iv) financial need and the risk of loss of the
18        environmental benefits of such resource, which shall
19        include the following information:
20                (I) the carbon-free energy resource's cost
21            projections, expressed on a per megawatt-hour
22            basis, over the next 5 delivery years, which shall
23            include the following: operation and maintenance
24            expenses; fully allocated overhead costs, which
25            shall be allocated using the methodology developed
26            by the Institute for Nuclear Power Operations;

 

 

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1            fuel expenditures; nonfuel capital expenditures;
2            spent fuel expenditures; a return on working
3            capital; the cost of operational and market risks
4            that could be avoided by ceasing operation; and
5            any other costs necessary for continued
6            operations, provided that "necessary" means, for
7            purposes of this subitem (I), that the costs could
8            reasonably be avoided only by ceasing operations
9            of the carbon-free energy resource; and
10                (II) the carbon-free energy resource's revenue
11            projections, including energy, capacity, ancillary
12            services, any other direct State support, known or
13            anticipated federal attribute credits, known or
14            anticipated tax credits, and any other direct
15            federal support.
16        The information described in this subparagraph (B) may
17    be submitted on a confidential basis and shall be treated
18    and maintained by the Agency, the procurement
19    administrator, and the Commission as confidential and
20    proprietary and exempt from disclosure under subparagraphs
21    (a) and (g) of paragraph (1) of Section 7 of the Freedom of
22    Information Act. The Office of the Attorney General shall
23    have access to, and maintain the confidentiality of, such
24    information pursuant to Section 6.5 of the Attorney
25    General Act.
26        (C) The Agency shall solicit bids for the contracts

 

 

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1    described in this subsection (d-10) from carbon-free
2    energy resources that have satisfied the requirements of
3    subparagraph (B) of this paragraph (3). The contracts
4    procured pursuant to a procurement event shall reflect,
5    and be subject to, the following terms, requirements, and
6    limitations:
7            (i) Contracts are for delivery of carbon
8        mitigation credits, and are not energy or capacity
9        sales contracts requiring physical delivery. Pursuant
10        to item (iii), contract payments shall fully deduct
11        the value of any monetized federal production tax
12        credits, credits issued pursuant to a federal clean
13        energy standard, and other federal credits if
14        applicable.
15            (ii) Contracts for carbon mitigation credits shall
16        commence with the delivery year beginning on June 1,
17        2022 and shall be for a term of 5 delivery years
18        concluding on May 31, 2027.
19            (iii) The price per carbon mitigation credit to be
20        paid under a contract for a given delivery year shall
21        be equal to an accepted bid price less the sum of:
22                (I) one of the following energy price indices,
23            selected by the bidder at the time of the bid for
24            the term of the contract:
25                    (aa) the weighted-average hourly day-ahead
26                price for the applicable delivery year at the

 

 

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1                busbar of all resources procured pursuant to
2                this subsection (d-10), weighted by actual
3                production from the resources; or
4                    (bb) the projected energy price for the
5                PJM Interconnection, LLC Northern Illinois Hub
6                for the applicable delivery year determined
7                according to subitem (aa) of item (iii) of
8                subparagraph (B) of paragraph (1) of
9                subsection (d-5).
10                (II) the Base Residual Auction Capacity Price
11            for the ComEd zone as determined by PJM
12            Interconnection, LLC, divided by 24 hours per day,
13            for the applicable delivery year for the first 3
14            delivery years, and then any subsequent delivery
15            years unless the PJM Interconnection, LLC applies
16            the Minimum Offer Price Rule to participating
17            carbon-free energy resources because they supply
18            carbon mitigation credits pursuant to this Section
19            at which time, upon notice by the carbon-free
20            energy resource to the Commission and subject to
21            the Commission's confirmation, the value under
22            this subitem shall be zero, as further described
23            in the carbon mitigation credit procurement plan;
24            and
25                (III) any value of monetized federal tax
26            credits, direct payments, or similar subsidy

 

 

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1            provided to the carbon-free energy resource from
2            any unit of government that is not already
3            reflected in energy prices.
4            If the price-per-megawatt-hour calculation
5        performed under item (iii) of this subparagraph (C)
6        for a given delivery year results in a net positive
7        value, then the electric utility counterparty to the
8        contract shall multiply such net value by the
9        applicable contract quantity and remit the amount to
10        the supplier.
11            To protect retail customers from retail rate
12        impacts that may arise upon the initiation of carbon
13        policy changes, if the price-per-megawatt-hour
14        calculation performed under item (iii) of this
15        subparagraph (C) for a given delivery year results in
16        a net negative value, then the supplier counterparty
17        to the contract shall multiply such net value by the
18        applicable contract quantity and remit such amount to
19        the electric utility counterparty. The electric
20        utility shall reflect such amounts remitted by
21        suppliers as a credit on its retail customer bills as
22        soon as practicable.
23            (iv) To ensure that retail customers in Northern
24        Illinois do not pay more for carbon mitigation credits
25        than the value such credits provide, and
26        notwithstanding the provisions of this subsection

 

 

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1        (d-10), the Agency shall not accept bids for contracts
2        that exceed a customer protection cap equal to the
3        baseline costs of carbon-free energy resources.
4            The baseline costs for the applicable year shall
5        be the following:
6                (I) For the delivery year beginning June 1,
7            2022, the baseline costs shall be an amount equal
8            to $30.30 per megawatt-hour.
9                (II) For the delivery year beginning June 1,
10            2023, the baseline costs shall be an amount equal
11            to $32.50 per megawatt-hour.
12                (III) For the delivery year beginning June 1,
13            2024, the baseline costs shall be an amount equal
14            to $33.43 per megawatt-hour.
15                (IV) For the delivery year beginning June 1,
16            2025, the baseline costs shall be an amount equal
17            to $33.50 per megawatt-hour.
18                (V) For the delivery year beginning June 1,
19            2026, the baseline costs shall be an amount equal
20            to $34.50 per megawatt-hour.
21            An Environmental Protection Agency consultant
22        forecast, included in a report issued April 14, 2021,
23        projects that a carbon-free energy resource has the
24        opportunity to earn on average approximately $30.28
25        per megawatt-hour, for the sale of energy and capacity
26        during the time period between 2022 and 2027.

 

 

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1        Therefore, the sale of carbon mitigation credits
2        provides the opportunity to receive an additional
3        amount per megawatt-hour in addition to the projected
4        prices for energy and capacity.
5            Although actual energy and capacity prices may
6        vary from year-to-year, the General Assembly finds
7        that this customer protection cap will help ensure
8        that the cost of carbon mitigation credits will be
9        less than its value, based upon the social cost of
10        carbon identified in the Technical Support Document
11        issued in February 2021 by the U.S. Interagency
12        Working Group on Social Cost of Greenhouse Gases and
13        the PJM Interconnection, LLC carbon dioxide marginal
14        emission rate for 2020, and that a carbon-free energy
15        resource receiving payment for carbon mitigation
16        credits receives no more than necessary to keep those
17        units in operation.
18        (D) No later than 7 days after the effective date of
19    this amendatory Act of the 102nd General Assembly, the
20    Agency shall publish its proposed carbon mitigation credit
21    procurement plan. The Plan shall provide that winning bids
22    shall be selected by taking into consideration which
23    resources best match public interest criteria that
24    include, but are not limited to, minimizing carbon dioxide
25    emissions that result from electricity consumed in
26    Illinois and minimizing sulfur dioxide, nitrogen oxide,

 

 

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1    and particulate matter emissions that adversely affect the
2    citizens of this State. The selection of winning bids
3    shall also take into account the incremental environmental
4    benefits resulting from the procurement or procurements,
5    such as any existing environmental benefits that are
6    preserved by a procurement held under this subsection
7    (d-10) and would cease to exist if the procurement were
8    not held, including the preservation of carbon-free energy
9    resources. For those bidders having the same public
10    interest criteria score, the relative ranking of such
11    bidders shall be determined by price. The Plan shall
12    describe in detail how each public interest factor shall
13    be considered and weighted in the bid selection process to
14    ensure that the public interest criteria are applied to
15    the procurement. The Plan shall, to the extent practical
16    and permissible by federal law, ensure that successful
17    bidders make commercially reasonable efforts to apply for
18    federal tax credits, direct payments, or similar subsidy
19    programs that support carbon-free generation and for which
20    the successful bidder is eligible. Upon publishing of the
21    carbon mitigation credit procurement plan, copies of the
22    plan shall be posted and made publicly available on the
23    Agency's website. All interested parties shall have 7 days
24    following the date of posting to provide comment to the
25    Agency on the plan. All comments shall be posted to the
26    Agency's website. Following the end of the comment period,

 

 

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1    but no more than 19 days later than the effective date of
2    this amendatory Act of the 102nd General Assembly, the
3    Agency shall revise the plan as necessary based on the
4    comments received and file its carbon mitigation credit
5    procurement plan with the Commission.
6        (E) If the Commission determines that the plan is
7    likely to result in the procurement of cost-effective
8    carbon mitigation credits, then the Commission shall,
9    after notice and hearing and opportunity for comment, but
10    no later than 42 days after the Agency filed the plan,
11    approve the plan or approve it with modification. For
12    purposes of this subsection (d-10), "cost-effective" means
13    carbon mitigation credits that are procured from
14    carbon-free energy resources at prices that are within the
15    limits specified in this paragraph (3). As part of the
16    Commission's review and acceptance or rejection of the
17    procurement results, the Commission shall, in its public
18    notice of successful bidders:
19            (i) identify how the selected carbon-free energy
20        resources satisfy the public interest criteria
21        described in this paragraph (3) of minimizing carbon
22        dioxide emissions that result from electricity
23        consumed in Illinois and minimizing sulfur dioxide,
24        nitrogen oxide, and particulate matter emissions that
25        adversely affect the citizens of this State;
26            (ii) specifically address how the selection of

 

 

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1        carbon-free energy resources takes into account the
2        incremental environmental benefits resulting from the
3        procurement, including any existing environmental
4        benefits that are preserved by the procurements held
5        under this amendatory Act of the 102nd General
6        Assembly and would have ceased to exist if the
7        procurements had not been held, such as the
8        preservation of carbon-free energy resources;
9            (iii) quantify the environmental benefit of
10        preserving the carbon-free energy resources procured
11        pursuant to this subsection (d-10), including the
12        following:
13                (I) an assessment value of avoided greenhouse
14            gas emissions measured as the product of the
15            carbon-free energy resources' output over the
16            contract term, using generally accepted
17            methodologies for the valuation of avoided
18            emissions; and
19                (II) an assessment of costs of replacement
20            with other carbon-free energy resources and
21            renewable energy resources, including wind and
22            photovoltaic generation, based upon an assessment
23            of the prices paid for renewable energy credits
24            through programs and procurements conducted
25            pursuant to subsection (c) of Section 1-75 of this
26            Act, and the additional storage necessary to

 

 

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1            produce the same or similar capability of matching
2            customer usage patterns.
3        (F) The procurements described in this paragraph (3),
4    including, but not limited to, the execution of all
5    contracts procured, shall be completed no later than
6    December 3, 2021. The procurement and plan approval
7    processes required by this paragraph (3) shall be
8    conducted in conjunction with the procurement and plan
9    approval processes required by Section 16-111.5 of the
10    Public Utilities Act, to the extent practicable. However,
11    the Agency and Commission may, as appropriate, modify the
12    various dates and timelines under this subparagraph and
13    subparagraphs (D) and (E) of this paragraph (3) to meet
14    the December 3, 2021 contract execution deadline.
15    Following the completion of such procurements, and
16    consistent with this paragraph (3), the Agency shall
17    calculate the payments to be made under each contract in a
18    timely fashion.
19        (F-1) Costs incurred by the electric utility pursuant
20    to a contract authorized by this subsection (d-10) shall
21    be deemed prudently incurred and reasonable in amount, and
22    the electric utility shall be entitled to full cost
23    recovery pursuant to a tariff or tariffs filed with the
24    Commission.
25        (G) The counterparty electric utility shall retire all
26    carbon mitigation credits used to comply with the

 

 

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1    requirements of this subsection (d-10).
2        (H) If a carbon-free energy resource is sold to
3    another owner, the rights, obligations, and commitments
4    under this subsection (d-10) shall continue to the
5    subsequent owner.
6        (I) This subsection (d-10) shall become inoperative on
7    January 1, 2028.
8    (e) The draft procurement plans are subject to public
9comment, as required by Section 16-111.5 of the Public
10Utilities Act.
11    (f) The Agency shall submit the final procurement plan to
12the Commission. The Agency shall revise a procurement plan if
13the Commission determines that it does not meet the standards
14set forth in Section 16-111.5 of the Public Utilities Act.
15    (g) The Agency shall assess fees to each affected utility
16to recover the costs incurred in preparation of the annual
17procurement plan for the utility.
18    (h) The Agency shall assess fees to each bidder to recover
19the costs incurred in connection with a competitive
20procurement process.
21    (i) A renewable energy credit, carbon emission credit,
22zero emission credit, or carbon mitigation credit can only be
23used once to comply with a single portfolio or other standard
24as set forth in subsection (c), subsection (d), or subsection
25(d-5) of this Section, respectively. A renewable energy
26credit, carbon emission credit, zero emission credit, or

 

 

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1carbon mitigation credit cannot be used to satisfy the
2requirements of more than one standard. If more than one type
3of credit is issued for the same megawatt hour of energy, only
4one credit can be used to satisfy the requirements of a single
5standard. After such use, the credit must be retired together
6with any other credits issued for the same megawatt hour of
7energy.
8(Source: P.A. 101-81, eff. 7-12-19; 101-113, eff. 1-1-20;
9102-662, eff. 9-15-21.)