SB0861 99TH GENERAL ASSEMBLY

LRB099 04349 MLM 24376 b

99TH GENERAL ASSEMBLY
State of Illinois
2015 and 2016
SB0861

Introduced 2/11/2015, by Sen. Chris Nybo

SYNOPSIS AS INTRODUCED:

220 ILCS 5/16-102
220 ILCS 5/16-108.8

Amends the Public Utilities Act. Defines "distributed generation facility" to mean the equipment used by an interconnection customer to generate or store electricity that operates in parallel with the electric distribution system. A distributed generation facility typically includes an electric generator, a prime mover or energy storage, and the interconnection equipment required to safely interconnect with the electric distribution system or local electric power system. Provides that utilities may charge fees to users to recover the costs associated with the incremental direct costs only (previously any incremental costs) to the utility associated with administration of the smart grid test bed.

A BILL FOR

AN ACT concerning regulation.

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

Section 5. The Public Utilities Act is amended by changing Sections 16-102 and 16-108.8 as follows:

(220 ILCS 5/16-102)

Sec. 16-102. Definitions. For the purposes of this Article the following terms shall be defined as set forth in this Section.

"Alternative retail electric supplier" means every person, cooperative, corporation, municipal corporation, company, association, joint stock company or association, firm, partnership, individual, or other entity, their lessees, trustees, or receivers appointed by any court whatsoever, that offers electric power or energy for sale, lease or in exchange for other value received to one or more retail customers, or that engages in the delivery or furnishing of electric power or energy to such retail customers, and shall include, without limitation, resellers, aggregators and power marketers, but shall not include (i) electric utilities (or any agent of the electric utility to the extent the electric utility provides tariffed services to retail customers through that agent), (ii) any electric cooperative or municipal system as defined in Section 17-100 to the extent that the electric cooperative or municipal system is serving retail customers within any area in which it is or would be entitled to provide service under the law in effect immediately prior to the effective date of this amendatory Act of 1997, (iii) a public utility that is owned and operated by any public institution of higher education of this State, or a public utility that is owned by such public institution of higher education and operated by any of its lessees or operating agents, within any area in which it is or would be entitled to provide service under the law in effect immediately prior to the effective date of this amendatory Act of 1997, (iv) a retail customer to the extent that customer obtains its electric power and energy from that customer's own cogeneration or self-generation facilities, (v) an entity that owns, operates, sells, or arranges for the installation of a customer's own cogeneration or self-generation facilities, but only to the extent the entity is engaged in owning, selling or arranging for the installation of such facility, or operating the facility on behalf of such customer, provided however that any such third party owner or operator of a facility built after January 1, 1999, complies with the labor provisions of Section 16-128(a) as though such third party were an alternative retail electric supplier, or (vi) an industrial or manufacturing customer that owns its own distribution facilities, to the extent that the customer provides service from that distribution system to a third-party contractor located on the customer's premises that is integrally and predominantly engaged in the customer's industrial or manufacturing process; provided, that if the industrial or manufacturing customer has elected delivery services, the customer shall pay transition charges applicable to the electric power and energy consumed by the third-party contractor unless such charges are otherwise paid by the third party contractor, which shall be calculated based on the usage of, and the base rates or the contract rates applicable to, the third-party contractor in accordance with Section 16-102.

An entity that furnishes the service of charging electric vehicles does not and shall not be deemed to sell electricity and is not and shall not be deemed an alternative retail electric supplier, and is not subject to regulation as such under this Act notwithstanding the basis on which the service is provided or billed. If, however, the entity is otherwise deemed an alternative retail electric supplier under this Act, or is otherwise subject to regulation under this Act, then that entity is not exempt from and remains subject to the otherwise applicable provisions of this Act. The installation, maintenance, and repair of an electric vehicle charging station shall comply with the requirements of subsection (a) of Section 16-128 and Section 16-128A of this Act.

For purposes of this Section, the term "electric vehicles" has the meaning ascribed to that term in Section 10 of the Electric Vehicle Act.

"Base rates" means the rates for those tariffed services that the electric utility is required to offer pursuant to subsection (a) of Section 16-103 and that were identified in a rate order for collection of the electric utility's base rate revenue requirement, excluding (i) separate automatic rate adjustment riders then in effect, (ii) special or negotiated contract rates, (iii) delivery services tariffs filed pursuant to Section 16-108, (iv) real-time pricing, or (v) tariffs that were in effect prior to October 1, 1996 and that based charges for services on an index or average of other utilities' charges, but including (vi) any subsequent redesign of such rates for tariffed services that is authorized by the Commission after notice and hearing.

"Competitive service" includes (i) any service that has been declared to be competitive pursuant to Section 16-113 of this Act, (ii) contract service, and (iii) services, other than tariffed services, that are related to, but not necessary for, the provision of electric power and energy or delivery services.

"Contract service" means (1) services, including the provision of electric power and energy or other services, that are provided by mutual agreement between an electric utility and a retail customer that is located in the electric utility's service area, provided that, delivery services shall not be a contract service until such services are declared competitive pursuant to Section 16-113; and also means (2) the provision of electric power and energy by an electric utility to retail customers outside the electric utility's service area pursuant to Section 16-116. Provided, however, contract service does not include electric utility services provided pursuant to (i) contracts that retail customers are required to execute as a condition of receiving tariffed services, or (ii) special or negotiated rate contracts for electric utility services that were entered into between an electric utility and a retail customer prior to the effective date of this amendatory Act of 1997 and filed with the Commission.

"Delivery services" means those services provided by the electric utility that are necessary in order for the transmission and distribution systems to function so that retail customers located in the electric utility's service area can receive electric power and energy from suppliers other than the electric utility, and shall include, without limitation, standard metering and billing services.

"Distributed generation facility" means the equipment used by an interconnection customer to generate or store electricity that operates in parallel with the electric distribution system. A distributed generation facility typically includes an electric generator, a prime mover or energy storage, and the interconnection equipment required to safely interconnect with the electric distribution system or local electric power system.

"Electric utility" means a public utility, as defined in Section 3-105 of this Act, that has a franchise, license, permit or right to furnish or sell electricity to retail customers within a service area.

"Mandatory transition period" means the period from the effective date of this amendatory Act of 1997 through January 1, 2007.

"Municipal system" shall have the meaning set forth in Section 17-100.

"Real-time pricing" means tariffed retail charges for delivered electric power and energy that vary hour-to-hour and are determined from wholesale market prices using a methodology approved by the Illinois Commerce Commission.

"Retail customer" means a single entity using electric power or energy at a single premises and that (A) either (i) is receiving or is eligible to receive tariffed services from an electric utility, or (ii) that is served by a municipal system or electric cooperative within any area in which the municipal system or electric cooperative is or would be entitled to provide service under the law in effect immediately prior to the effective date of this amendatory Act of 1997, or (B) an entity which on the effective date of this Act was receiving electric service from a public utility and (i) was engaged in the practice of resale and redistribution of such electricity within a building prior to January 2, 1957, or (ii) was providing lighting services to tenants in a multi-occupancy building, but only to the extent such resale, redistribution or lighting service is authorized by the electric utility's tariffs that were on file with the Commission on the effective date of this Act.

"Service area" means (i) the geographic area within which an electric utility was lawfully entitled to provide electric power and energy to retail customers as of the effective date of this amendatory Act of 1997, and includes (ii) the location of any retail customer to which the electric utility was lawfully providing electric utility services on such effective date.

"Small commercial retail customer" means those nonresidential retail customers of an electric utility consuming 15,000 kilowatt-hours or less of electricity annually in its service area.

"Tariffed service" means services provided to retail customers by an electric utility as defined by its rates on file with the Commission pursuant to the provisions of Article IX of this Act, but shall not include competitive services.

"Transition charge" means a charge expressed in cents per kilowatt-hour that is calculated for a customer or class of customers as follows for each year in which an electric utility is entitled to recover transition charges as provided in Section 16-108:

(1) the amount of revenue that an electric utility would receive from the retail customer or customers if it were serving such customers' electric power and energy requirements as a tariffed service based on (A) all of the customers' actual usage during the 3 years ending 90 days prior to the date on which such customers were first eligible for delivery services pursuant to Section 16-104, and (B) on (i) the base rates in effect on October 1, 1996 (adjusted for the reductions required by subsection (b) of Section 16-111, for any reduction resulting from a rate decrease under Section 16-101(b), for any restatement of base rates made in conjunction with an elimination of the fuel adjustment clause pursuant to subsection (b), (d), or (f) of Section 9-220 and for any removal of decommissioning costs from base rates pursuant to Section 16-114) and any separate automatic rate adjustment riders (other than a decommissioning rate as defined in Section 16-114) under which the customers were receiving or, had they been customers, would have received electric power and energy from the electric utility during the year immediately preceding the date on which such customers were first eligible for delivery service pursuant to Section 16-104, or (ii) to the extent applicable, any contract rates, including contracts or rates for consolidated or aggregated billing, under which such customers were receiving electric power and energy from the electric utility during such year;

(2) less the amount of revenue, other than revenue from transition charges and decommissioning rates, that the electric utility would receive from such retail customers for delivery services provided by the electric utility, assuming such customers were taking delivery services for all of their usage, based on the delivery services tariffs in effect during the year for which the transition charge is being calculated and on the usage identified in paragraph (1);

(3) less the market value for the electric power and energy that the electric utility would have used to supply all of such customers' electric power and energy requirements, as a tariffed service, based on the usage identified in paragraph (1), with such market value determined in accordance with Section 16-112 of this Act;

(4) less the following amount which represents the amount to be attributed to new revenue sources and cost reductions by the electric utility through the end of the period for which transition costs are recovered pursuant to Section 16-108, referred to in this Article XVI as a "mitigation factor":

(A) for nonresidential retail customers, an amount equal to the greater of (i) 0.5 cents per kilowatt-hour during the period October 1, 1999 through December 31, 2004, 0.6 cents per kilowatt-hour in calendar year 2005, and 0.9 cents per kilowatt-hour in calendar year 2006, multiplied in each year by the usage identified in paragraph (1), or (ii) an amount equal to the following percentages of the amount produced by applying the applicable base rates (adjusted as described in subparagraph (1)(B)) or contract rate to the usage identified in paragraph (1): 8% for the period October 1, 1999 through December 31, 2002, 10% in calendar years 2003 and 2004, 11% in calendar year 2005 and 12% in calendar year 2006; and

(B) for residential retail customers, an amount equal to the following percentages of the amount produced by applying the base rates in effect on October 1, 1996 (adjusted as described in subparagraph (1)(B)) to the usage identified in paragraph (1): (i) 6% from May 1, 2002 through December 31, 2002, (ii) 7% in calendar years 2003 and 2004, (iii) 8% in calendar year 2005, and (iv) 10% in calendar year 2006;

(5) divided by the usage of such customers identified in paragraph (1),

provided that the transition charge shall never be less than zero.

"Unbundled service" means a component or constituent part of a tariffed service which the electric utility subsequently offers separately to its customers.

(Source: P.A. 97-1128, eff. 8-28-12.)

(220 ILCS 5/16-108.8)

Sec. 16-108.8. Illinois Smart Grid test bed.

(a) Within 180 days after the effective date of this amendatory Act of the 97th General Assembly, each participating utility, as defined by Section 16-108.5 of this Act, shall create or otherwise designate a Smart Grid test bed, which may be located at one or more places within the utility's system, for the purposes of allowing for the testing of Smart Grid technologies. The objectives of this test bed shall be to:

(1) provide an open, unbiased opportunity for testing programs, technologies, business models, and other Smart Grid-related activities;

(2) provide on-grid locations for the testing of potentially innovative Smart Grid-related technologies and services, including but not limited to those funded by the trust or foundation established pursuant to Section 16-108.7 of this Act;

(3) facilitate testing of business models or services that help integrate Smart Grid-related technologies into the electric grid, especially those business models that may help promote new products and services for retail customers;

(4) offer opportunities to test and showcase Smart Grid technologies and services, especially those likely to support the economic development goals of the State of Illinois.

(b) The test bed shall reside in one or more locations on the participating utility's network. Such locations shall be chosen by the utility to maximize the opportunity for real-time and real-world testing of Smart Grid technologies and services taking into account the safety and security of the participating utility's grid and grid operations.

(c) The participating utility, with input from the Smart Grid Advisory Council established pursuant to Section 16-108.6 of this Act, shall, as part of its filing under subsection (b) of Section 16-108.5, include a plan for the creation, operation, and administration of the test bed. This plan shall address the following:

(1) how the utility proposes to comply with each of the objectives set forth in subsection (a) of this Section;

(2) the proposed location or locations of the test bed;

(3) the process by which the utility will receive, review, and qualify proposals to use the test bed;

(4) the criteria by which the utility proposes to qualify proposals to use the test bed, including, but not limited to, safety, reliability, security, customer data security, privacy, and economic development considerations;

(5) the engineering and operations support that the utility will provide to test bed users, including provision of customer data; and

(6) the estimated costs to establish, administer and promote the availability of the test bed.

(d) The test bed should be open to all qualified entities wishing to test programs, technologies, business models, and other Smart Grid-related activities, provided that the utility retains control of its grid and operations and may reject any programs, technologies, business models, and other Smart Grid-related activities that threaten the reliability, safety, security, or operations of its network, or that would threaten the security of customer-identifiable data in the judgment of the utility. The number of technologies and entities participating in the test bed at any time may be limited by the utility based on its determination of its ability to maintain a secure, safe, and reliable grid.

(e) At a minimum, the test bed shall have the ability to receive live signals from PJM Interconnection LLC or other applicable regional transmission organization, the ability to test new applications in a utility scale environment (to include ramp rate regulations for distributed wind and solar resources), critical peak price response, and market-based power dispatch.

(f) At the end of the fourth year of operation the test bed shall be subject to an independent evaluation to determine if the test bed is meeting the objectives of this Section or is likely to meet the objectives in the future. The evaluation shall include the performance of the utility as test bed operator. Subject to the findings, the utility and the trust or foundation established pursuant to Section 16-108.7 of this Act may choose to continue operating the test bed.

(g) The utility shall be entitled to recover all prudently incurred and reasonable costs associated with evaluation of proposals, engineering, construction, operation, and administration of the test bed through the performance-based formula rate tariff established pursuant to Section 16-108.5 of this Act.

(h) The utility is authorized to charge fees to users of the test bed that shall recover the costs associated with the incremental direct costs to the utility associated with administration of the test bed, provided, however, that any such fees collected by the utility shall be used to offset the costs to be recovered pursuant to subsection (g) of this Section.

(i) On a quarterly basis, the utility shall provide the trust or foundation established pursuant to Section 16-108.7 of this Act with a report summarizing test bed activities, customers, discoveries, and other information as shall be mutually deemed relevant.

(j) To the extent practicable, the utility and trust or foundation established pursuant to Section 16-108.7 of this Act shall jointly pursue resources that enhance the capabilities and capacity of the test bed.

(k) If Section 16-108.5 of this Act becomes inoperative with respect to one or more participating utilities as set forth in subsection (g) or (h) of that Section, then Sections 16-108.5, 16-108.6, 16-108.7, and 16-108.8 of this Act shall become inoperative as to each affected utility and its service area on the same date as Section 16-108.5 become inoperative.

(Source: P.A. 97-616, eff. 10-26-11.)