HB2528 96TH GENERAL ASSEMBLY

LRB096 08716 MJR 18848 b

96TH GENERAL ASSEMBLY
State of Illinois
2009 and 2010
HB2528

Introduced 2/20/2009, by Rep. Thomas Holbrook

SYNOPSIS AS INTRODUCED:

220 ILCS 5/16-132 new

Amends the Electric Service Customer Choice and Rate Relief Law of 1997 in the Public Utilities Act. Provides that an alternative retail electric supplier shall be responsible for procuring cost-effective renewable energy resources as required under specified provisions of the Act in a specified manner. Provides that an alternative retail electric supplier shall comply with the renewable energy portfolio standards by any one or a combination of specified means. Contains provisions concerning the use of renewable energy certificates. Contains provisions concerning alternative compliance payments for alternative retail electric suppliers. Provides that each alternative retail electric supplier shall, by September 1, 2011 and by September 1 of each year thereafter, prepare, and submit to the Illinois Commerce Commission a report that provides information certifying compliance by the alternative retail electric supplier with specified provisions. Provides that upon complaint or the Commission's own motion, the Commission may conduct a contested case to review allegations that the alternative retail electric supplier has violated specified provisions. Contains an exemption from specified requirements for electric utilities that meet certain criteria. Provides that biennially, the Commission shall submit to the General Assembly a report that discusses the status of renewable energy in the State and the effect of certain provisions on electricity prices and retail and wholesale electric markets.

FISCAL NOTE ACT MAY APPLY

A BILL FOR

AN ACT concerning utilities.

Be it enacted by the People of the State of Illinois, represented in the General Assembly:

Section 5. The Public Utilities Act is amended by adding Section 16-132 as follows:

(220 ILCS 5/16-132 new)

Sec. 16-132. Renewable portfolio standards.

(a) An alternative retail electric supplier shall be responsible for procuring cost-effective renewable energy resources as required under item (5) of subsection (d) of Section 16-115 of this Act as follows:

(1) The definition of renewable energy resources contained in Section 1-10 of the Illinois Power Agency Act shall apply to all renewable energy resources required to be procured by alternative retail electric suppliers.

(2) The quantity of renewable energy resources shall be measured as a percentage of the actual amount of electricity (megawatt-hours) supplied by the alternative retail electric supplier in the prior calendar year, as reported for that prior calendar year to the Commission.

(3) The quantity of renewable energy resources will be in amounts at least equal to the percentages set forth in item (1) of subsection (c) of Section 1-75 of the Illinois Power Agency Act.

(4) The required procurement of renewable energy resources by an alternative retail electric supplier commences with the June 1, 2010 through May 31, 2011 procurement year, and continues each year thereafter for the comparable 12-month period; provided, however, that retail contracts in effect prior to January 12, 2009 are exempt from compliance with these requirements, provided that the alternative retail electric supplier submits all documentation needed by the Commission to determine the actual amount of electricity supplied under contracts that may be excluded under this limitation. Any retail contracts executed between January 12, 2009 and the effective date of this amendatory Act of the 96th General Assembly shall be exempt from compliance with these requirements for a 24-month period after the effective date of this amendatory Act of the 96th General Assembly. Beginning with the June 1, 2012 through May 31, 2013 procurement year, all megawatt-hours supplied by the alternative retail electric supplier after June 1, 2011 to retail customers shall be included in the calculation to determine the quantity of renewable energy resources to be procured. Alternative retail electric suppliers shall be required to submit all documentation needed by the Commission to determine the actual amount of electricity supplied under contracts that may be excluded under either of the limitations included in this Section.

(b) An alternative retail electric supplier shall comply with the renewable energy portfolio standards by any one or a combination of the following means:

(1) producing electricity from renewable energy systems;

(2) purchasing electricity through a renewable energy contract;

(3) purchasing renewable energy credits; or

(4) making an alternative compliance payment as described in subsection (d) of this Section.

(c) Use of renewable energy certificates.

(1) Renewable energy certificates that are not used by an alternative retail electric supplier to comply with a renewable portfolio standard in a compliance year may be banked and carried forward up to 2 years after the year of generation for the purpose of complying with a renewable portfolio standard in those 2 subsequent years.

(2) An alternative retail electric supplier is responsible for demonstrating that a renewable energy certificate used to comply with a renewable portfolio standard is derived from a renewable energy resource and that the alternative retail electric supplier has not used, traded, sold, or otherwise transferred the certificate.

(3) The same renewable energy certificate may be used by an alternative retail electric supplier to comply with a federal renewable portfolio standard and a renewable portfolio standard established under this Act. An alternative retail electric supplier that uses a renewable energy certificate to comply with a renewable portfolio standard imposed by any other state may not use the same certificate to comply with a renewable portfolio standard established under this Act.

(d) Alternative compliance payments.

(1) The Commission shall establish an alternative compliance rate for each compliance year for the alternative retail electric suppliers that are subject to a renewable portfolio standard. The rate shall be expressed in dollars per megawatt-hour and shall at no time exceed the amount paid by eligible retail customers of an electric utility to meet the renewable portfolio standards set forth in Section 1-75 of the Illinois Power Agency Act.

(2) In establishing an alternative compliance rate, the Commission shall set the rate at least 3 years forward so as to provide adequate incentive for the alternative retail electric supplier to purchase or generate qualifying renewable energy resources in lieu of using an alternative compliance payment to meet the renewable portfolio standard applicable to the alternative retail electric supplier.

(3) In any given compliance year, an alternative retail electric supplier may elect to use an alternative compliance payment to comply with all or a part of the applicable renewable portfolio standard. Any election by an alternative retail electric supplier to use alternative compliance payments is subject to review by the Commission under subsection (e) of this Section.

(4) All alternative compliance payments by alternative retail electric suppliers shall be deposited in an account or accounts as shall be determined by the Commission on an annual basis; provided, however, that 20% of assessed alternative compliance charges shall be deposited in the Renewable Energy Resources Trust Fund, the Energy Efficiency Trust Fund, or the Public Utility Fund. Amounts in both of the accounts shall accrue interest at the rate of return authorized by the Commission.

(5) Amounts in accounts established under item (4) of this subsection (d) may be expended only for costs associated with incentive programs for new generating capacity from renewable energy resources or energy conservation programs within the State of Illinois. The Commission must approve expenditures from an account or accounts established under item (4) of this subsection.

(6) The Commission shall establish initial alternative compliance rates as required by this Section no later than June 1, 2009 and shall determine the formula or process for annually setting the alternative compliance rate for 3 years forward no later than January 1 of each year for the next 3-year period.

(e) Each alternative retail electric supplier shall, by September 1, 2011 and by September 1 of each year thereafter, prepare and submit to the Commission a report that provides information certifying compliance by the alternative retail electric supplier with this Section, including copies of all PJM Environmental Information System's Generation Attribute Tracking System ("PJM-GATS"), MISO's Midwest Renewable Energy Tracking System ("MISO M-RETS") reports, or contracts and other documentation relating to compliance. An alternative retail electric supplier may file commercially or financially sensitive information or trade secrets with the Commission as provided under the rules of the Commission. To be filed confidentially, the information shall be accompanied by an affidavit that sets forth both the reasons for the confidentiality and a public synopsis of the information.

(f) Within 120 days after the effective date of this amendatory Act of the 96th General Assembly, but in no event later than October 1, 2009, the Commission shall establish rules to implement this Section, which may include, but are not limited to, all of the following:

(1) A standard format for the submission of annual reports by an alternative retail electric supplier.

(2) Use of the MISO M-RETS and PJM-GATS systems for independent verification of the location of generation, resource type, month and year of generation for all eligible qualifying renewable energy facilities, including all existing renewable energy systems eligible to receive renewable energy credits and a procedure for certification of new qualifying renewable energy facilities.

(3) A method for the banking, transferring, and retiring of renewable energy certificates.

(4) A method to address the implications on the required procurement of renewable resources when alternative retail electric suppliers exit or enter the Illinois market.

(5) Ensuring that alternative retail electric suppliers are not placed at a competitive disadvantage compared to the eligible retail customers of electric utilities subject to Section 1-75 of the Illinois Power Agency Act.

(6) The provision of any other information that the Commission determines necessary.

(g) Upon complaint or the Commission's own motion, the Commission may conduct a contested case to review allegations that the alternative retail electric supplier has violated this Section, including an order issued or rule promulgated under this Section. If the Commission finds, after notice and hearing, that an alternative electric supplier has violated this Section, the Commission may do one or more of the following:

(1) issue a cease and desist order;

(2) order the alternative retail electric supplier to immediately come into compliance with the Act and to pay a civil fine of not less than $5,000 or more than $50,000 for each violation;

(3) revoke the license of the alternative electric supplier; or

(4) impose any other penalty that the Commission deems reasonable and appropriate.

The Commission shall not accept an application for certification from an alternative retail electric supplier that has lost certification under this subsection (g), or any corporate affiliate thereof, for at least one year from the date of revocation.

(h) All of the provisions of this Section apply to an electric utility operating outside its service area, except that under item (2) of subsection (a) of this Section the quantity of renewable energy resources shall be measured as a percentage of the actual amount of electricity (megawatt-hours) supplied in this State outside of the utility's service territory in the prior calendar year, as reported for that prior calendar year to the Commission.

(i) Biennially, the Commission shall submit to the General Assembly a report that discusses the status of renewable energy in this State and the effect of this Section on electricity prices and retail and wholesale electric markets. In each report, the Commission shall make any recommendations it may have concerning amendments to this Act.