Full Text of HB4573 97th General Assembly
HB4573 97TH GENERAL ASSEMBLY |
| | 97TH GENERAL ASSEMBLY
State of Illinois
2011 and 2012 HB4573 Introduced 2/1/2012, by Rep. Brandon W. Phelps SYNOPSIS AS INTRODUCED: |
| 220 ILCS 5/9-220 | from Ch. 111 2/3, par. 9-220 | 220 ILCS 20/2.02 | from Ch. 111 2/3, par. 552.2 | 220 ILCS 20/2.03 | from Ch. 111 2/3, par. 552.3 | 220 ILCS 20/2.04 | from Ch. 111 2/3, par. 552.4 | 220 ILCS 20/3 | from Ch. 111 2/3, par. 553 | 220 ILCS 75/30 | |
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Amends the Public Utilities Act. Removes a provision concerning the inspection of all carbon dioxide pipelines in the State by the Illinois Commerce Commission. Amends the Illinois Gas Pipeline Safety Act. Makes changes to the definitions of "gas", "transportation of gas", and "pipeline facilities". Amends the Carbon Dioxide Transportation and Sequestration Act. Provides that the construction, maintenance, and operation of pipelines transporting carbon dioxide, whether interstate or intrastate, falls within the jurisdiction of the Pipeline and Hazardous Material Safety Administration of the federal Department of Transportation. Provides that each carbon dioxide pipeline owner shall comply fully with all federal laws and regulations governing the construction, maintenance, and operation of pipelines transporting carbon dioxide. Effective immediately.
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| | A BILL FOR |
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| 1 | | AN ACT concerning regulation.
| 2 | | Be it enacted by the People of the State of Illinois,
| 3 | | represented in the General Assembly:
| 4 | | Section 5. The Public Utilities Act is amended by changing | 5 | | Section 9-220 as follows: | 6 | | (220 ILCS 5/9-220) (from Ch. 111 2/3, par. 9-220) | 7 | | Sec. 9-220. Rate changes based on changes in fuel costs. | 8 | | (a) Notwithstanding the provisions of Section 9-201, the
| 9 | | Commission may authorize the increase or decrease of rates and | 10 | | charges
based upon changes in the cost of fuel used in the | 11 | | generation or production
of electric power, changes in the cost | 12 | | of purchased power, or changes in
the cost of purchased gas | 13 | | through the application of fuel adjustment
clauses or purchased | 14 | | gas adjustment clauses. The Commission may also
authorize the | 15 | | increase or decrease of rates and charges based upon | 16 | | expenditures
or revenues resulting from the purchase or sale of | 17 | | emission allowances created
under the federal Clean Air Act | 18 | | Amendments of 1990,
through such fuel adjustment clauses, as a | 19 | | cost of fuel. For the purposes of
this paragraph, cost of fuel | 20 | | used in the generation or production of electric
power shall | 21 | | include the amount of any fees paid by the utility for the
| 22 | | implementation and operation of a process for the | 23 | | desulfurization of the
flue gas when burning high sulfur coal |
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| 1 | | at any location within the State of
Illinois irrespective of | 2 | | the attainment status designation of such
location; but shall | 3 | | not include transportation costs
of coal
(i) except to the | 4 | | extent that for contracts entered into on
and after the | 5 | | effective date of this amendatory Act of 1997,
the cost of the | 6 | | coal, including transportation costs,
constitutes the lowest | 7 | | cost for adequate and reliable fuel
supply reasonably available | 8 | | to the public utility in
comparison to the cost, including | 9 | | transportation costs, of
other adequate and reliable sources of | 10 | | fuel supply reasonably
available to the public utility, or (ii)
| 11 | | except as otherwise provided in the next 3 sentences of this | 12 | | paragraph.
Such costs of fuel
shall, when requested by a | 13 | | utility or at the conclusion of the utility's
next general | 14 | | electric rate proceeding, whichever shall first occur, include
| 15 | | transportation costs of coal purchased under existing coal | 16 | | purchase
contracts. For purposes of this paragraph "existing | 17 | | coal purchase
contracts" means contracts for the purchase of | 18 | | coal in effect on the
effective date of this amendatory Act of | 19 | | 1991, as such contracts may
thereafter be amended, but only to | 20 | | the extent that any such amendment does
not increase the | 21 | | aggregate quantity of coal to be purchased under such
contract.
| 22 | | Nothing herein shall authorize an electric utility
to recover | 23 | | through its fuel adjustment clause any amounts of
| 24 | | transportation costs of coal that were included in the revenue
| 25 | | requirement used to set base rates in its most recent general
| 26 | | rate proceeding.
Cost shall be based upon uniformly applied |
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| 1 | | accounting
principles. Annually, the Commission shall initiate | 2 | | public hearings to
determine whether the clauses reflect actual | 3 | | costs of fuel, gas, power, or
coal transportation purchased to | 4 | | determine whether such purchases were
prudent, and to reconcile | 5 | | any amounts collected with the actual costs of
fuel, power, | 6 | | gas, or coal transportation prudently purchased. In each such
| 7 | | proceeding, the burden of proof shall be upon the utility to | 8 | | establish the
prudence of its cost of fuel, power, gas, or coal
| 9 | | transportation purchases
and costs.
The Commission shall
issue | 10 | | its final order in each such annual proceeding for an
electric | 11 | | utility by December 31 of the year immediately
following the | 12 | | year to which the proceeding pertains, provided,
that the | 13 | | Commission shall issue its final order with respect
to such | 14 | | annual proceeding for the years 1996 and earlier by December | 15 | | 31, 1998. | 16 | | (b) A public utility providing electric service, other than | 17 | | a public utility
described in subsections (e) or (f) of this | 18 | | Section, may at
any time during the mandatory transition period | 19 | | file with the
Commission proposed tariff sheets that eliminate | 20 | | the public
utility's fuel adjustment clause and adjust the | 21 | | public
utility's base rate tariffs by the amount necessary for | 22 | | the
base fuel component of the base rates to recover the public
| 23 | | utility's average fuel and power supply costs per kilowatt-hour | 24 | | for the 2
most recent years for which the Commission
has issued | 25 | | final orders in annual proceedings pursuant to
subsection (a), | 26 | | where the average fuel and power supply costs
per kilowatt-hour |
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| 1 | | shall be calculated as the sum of the public
utility's prudent | 2 | | and allowable fuel and power supply costs as
found by the | 3 | | Commission in the 2 proceedings divided by the
public utility's | 4 | | actual jurisdictional kilowatt-hour sales for
those 2 years. | 5 | | Notwithstanding any contrary or inconsistent
provisions in | 6 | | Section 9-201 of this Act, in subsection (a) of
this Section or | 7 | | in any rules or regulations promulgated by the
Commission | 8 | | pursuant to subsection (g) of this Section, the
Commission | 9 | | shall review and shall by order approve, or approve
as | 10 | | modified, the proposed tariff sheets within 60 days after
the | 11 | | date of the public utility's filing. The Commission may
modify | 12 | | the public utility's proposed tariff sheets only to the
extent | 13 | | the Commission finds necessary to achieve conformance
to the | 14 | | requirements of this subsection (b). During the 5
years | 15 | | following the date of the Commission's order, but in any
event | 16 | | no earlier than January 1, 2007, a public utility whose
fuel | 17 | | adjustment clause has been eliminated pursuant to this
| 18 | | subsection shall not file proposed tariff sheets seeking, or
| 19 | | otherwise petition the Commission for, reinstatement of a fuel
| 20 | | adjustment clause. | 21 | | (c) Notwithstanding any contrary or inconsistent
| 22 | | provisions in Section 9-201 of this Act, in subsection (a) of
| 23 | | this Section or in any rules or regulations promulgated by the
| 24 | | Commission pursuant to subsection (g) of this Section, a
public | 25 | | utility providing electric service, other than a public utility
| 26 | | described
in subsection (e) or (f) of this Section, may at any |
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| 1 | | time
during the mandatory transition period file with the
| 2 | | Commission proposed tariff sheets that establish the rate per
| 3 | | kilowatt-hour to be applied pursuant to the public utility's
| 4 | | fuel adjustment clause at the average value for such rate
| 5 | | during the preceding 24 months, provided that such average
rate | 6 | | results in a credit to customers' bills, without making
any | 7 | | revisions to the public utility's base rate tariffs. The
| 8 | | proposed tariff sheets shall establish the fuel adjustment
rate | 9 | | for a specific time period of at least 3 years but not
more | 10 | | than 5 years, provided that the terms and conditions for
any | 11 | | reinstatement earlier than 5 years shall be set forth in
the | 12 | | proposed tariff sheets and subject to modification or
approval | 13 | | by the Commission. The Commission shall review and
shall by | 14 | | order approve the proposed tariff sheets if it finds
that the | 15 | | requirements of this subsection are met. The
Commission shall | 16 | | not conduct the annual hearings specified in the
last 3 | 17 | | sentences of subsection (a) of this Section for the
utility for | 18 | | the period that the factor established pursuant to
this | 19 | | subsection is in effect. | 20 | | (d) A public utility providing electric service, or a | 21 | | public utility
providing gas service
may file with the | 22 | | Commission proposed tariff sheets that
eliminate the public | 23 | | utility's fuel or purchased gas
adjustment clause and adjust | 24 | | the public utility's base rate
tariffs to provide for recovery | 25 | | of power supply costs or gas
supply costs that would have been | 26 | | recovered through such
clause; provided, that the provisions of |
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| 1 | | this subsection (d) shall not be
available to a public utility | 2 | | described in subsections (e) or (f) of this
Section to | 3 | | eliminate its fuel adjustment clause. Notwithstanding any | 4 | | contrary
or inconsistent
provisions in Section 9-201 of this | 5 | | Act, in subsection (a) of
this Section, or in any rules or | 6 | | regulations promulgated by
the Commission pursuant to | 7 | | subsection (g) of this Section, the
Commission shall review and | 8 | | shall by order approve, or approve
as modified in the | 9 | | Commission's order, the proposed tariff
sheets within 240 days | 10 | | after the date of the public utility's
filing. The Commission's | 11 | | order shall approve rates and
charges that the Commission, | 12 | | based on information in the
public utility's filing or on the | 13 | | record if a hearing is held
by the Commission, finds will | 14 | | recover the reasonable, prudent
and necessary jurisdictional | 15 | | power supply costs or gas supply
costs incurred or to be | 16 | | incurred by the public utility during
a 12 month period found | 17 | | by the Commission to be appropriate
for these purposes, | 18 | | provided, that such period shall be either
(i) a 12 month | 19 | | historical period occurring during the 15
months ending on the | 20 | | date of the public utility's filing, or
(ii) a 12 month future | 21 | | period ending no later than 15 months
following the date of the | 22 | | public utility's filing. The public
utility shall include with | 23 | | its tariff filing information
showing both (1) its actual | 24 | | jurisdictional power supply costs
or gas supply costs for a 12 | 25 | | month historical period
conforming to (i) above and (2) its | 26 | | projected jurisdictional
power supply costs or gas supply costs |
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| 1 | | for a future 12 month
period conforming to (ii) above. If the | 2 | | Commission's order
requires modifications in the tariff sheets | 3 | | filed by the
public utility, the public utility shall have 7 | 4 | | days following
the date of the order to notify the Commission | 5 | | whether the
public utility will implement the modified tariffs | 6 | | or elect to
continue its fuel or purchased gas adjustment | 7 | | clause in force
as though no order had been entered. The | 8 | | Commission's order
shall provide for any reconciliation of | 9 | | power supply costs or
gas supply costs, as the case may be, and | 10 | | associated revenues
through the date that the public utility's | 11 | | fuel or purchased
gas adjustment clause is eliminated. During | 12 | | the 5 years
following the date of the Commission's order, a | 13 | | public utility
whose fuel or purchased gas adjustment clause | 14 | | has been
eliminated pursuant to this subsection shall not file | 15 | | proposed
tariff sheets seeking, or otherwise petition the | 16 | | Commission
for, reinstatement or adoption of a fuel or | 17 | | purchased gas
adjustment clause. Nothing in this subsection (d) | 18 | | shall be
construed as limiting the Commission's authority to | 19 | | eliminate
a public utility's fuel adjustment clause or | 20 | | purchased gas
adjustment clause in accordance with any other | 21 | | applicable
provisions of this Act. | 22 | | (e) Notwithstanding any contrary or inconsistent | 23 | | provisions in
Section 9-201 of this Act, in subsection (a) of | 24 | | this Section, or in
any rules promulgated by the Commission | 25 | | pursuant
to subsection (g) of this Section, a public utility | 26 | | providing
electric service to more than 1,000,000 customers in |
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| 1 | | this State may, within the
first 6 months after the
effective | 2 | | date of this amendatory Act of 1997, file with the
Commission | 3 | | proposed tariff sheets that eliminate, effective
January 1, | 4 | | 1997, the public utility's fuel adjustment clause
without | 5 | | adjusting its base rates, and such tariff sheets shall be
| 6 | | effective upon filing. To the extent the application of the | 7 | | fuel
adjustment clause had resulted in net charges to customers | 8 | | after
January 1, 1997, the utility shall also file a tariff | 9 | | sheet that
provides for a refund stated on a per kilowatt-hour | 10 | | basis of such
charges over a period not to exceed 6 months; | 11 | | provided
however, that such refund shall not include the | 12 | | proportional
amounts of taxes paid under the Use Tax Act, | 13 | | Service Use Tax Act,
Service Occupation Tax Act, and Retailers' | 14 | | Occupation Tax Act on
fuel used in generation. The Commission | 15 | | shall issue an order
within 45 days after the date of the | 16 | | public utility's filing
approving or approving as modified such | 17 | | tariff sheet. If the fuel
adjustment clause is eliminated | 18 | | pursuant to this subsection, the
Commission shall not conduct | 19 | | the annual hearings specified in the
last 3 sentences of | 20 | | subsection (a) of this Section for the
utility for any period | 21 | | after December 31, 1996 and prior to any
reinstatement of such | 22 | | clause. A public utility whose fuel
adjustment clause has been | 23 | | eliminated pursuant to this subsection
shall not file a | 24 | | proposed tariff sheet seeking, or otherwise
petition the | 25 | | Commission for, reinstatement of the fuel adjustment
clause | 26 | | prior to January 1, 2007. |
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| 1 | | (f) Notwithstanding any contrary or inconsistent | 2 | | provisions in Section
9-201 of this Act, in subsection (a) of | 3 | | this Section, or in any rules or
regulations promulgated by the | 4 | | Commission pursuant to subsection (g) of this
Section, a public | 5 | | utility providing electric service to more than 500,000
| 6 | | customers but fewer than 1,000,000 customers in this State may, | 7 | | within the
first
6 months after the effective date of this | 8 | | amendatory Act of 1997, file with the
Commission proposed | 9 | | tariff sheets that eliminate, effective January 1, 1997,
the | 10 | | public utility's fuel adjustment clause and adjust its base | 11 | | rates by the
amount necessary for the base fuel component of | 12 | | the base rates to recover
91% of the public utility's average | 13 | | fuel and power supply costs for the 2 most
recent years for | 14 | | which the Commission, as of January 1, 1997, has issued final
| 15 | | orders in annual proceedings pursuant to subsection (a), where | 16 | | the average fuel
and power supply costs per kilowatt-hour shall | 17 | | be calculated as the sum of the
public utility's prudent and | 18 | | allowable fuel and power supply costs as found by
the | 19 | | Commission in the 2 proceedings divided by the public utility's | 20 | | actual
jurisdictional kilowatt-hour sales for those 2 years, | 21 | | provided, that such
tariff sheets shall be effective upon | 22 | | filing. To the extent the application of
the fuel adjustment | 23 | | clause had resulted in net charges to customers after
January | 24 | | 1, 1997, the utility shall also file a tariff sheet that | 25 | | provides for a
refund stated on a per kilowatt-hour basis of | 26 | | such charges over a period not to
exceed 6 months. Provided |
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| 1 | | however, that such refund shall not include the
proportional | 2 | | amounts of taxes paid under the Use Tax Act, Service Use Tax | 3 | | Act,
Service Occupation Tax Act, and Retailers' Occupation Tax | 4 | | Act on fuel used in
generation. The Commission shall issue an | 5 | | order within 45 days after the date
of the public utility's | 6 | | filing approving or approving as modified such tariff
sheet. If | 7 | | the fuel adjustment clause is eliminated pursuant to this
| 8 | | subsection, the Commission shall not conduct the annual | 9 | | hearings specified in
the last 3 sentences of subsection (a) of | 10 | | this Section for the utility for any
period after December 31, | 11 | | 1996 and prior to any reinstatement of such clause.
A public | 12 | | utility whose fuel adjustment clause has been eliminated | 13 | | pursuant to
this subsection shall not file a proposed tariff | 14 | | sheet seeking, or otherwise
petition the Commission for, | 15 | | reinstatement of the fuel adjustment clause prior
to January 1, | 16 | | 2007. | 17 | | (g) The Commission shall have authority to promulgate rules | 18 | | and
regulations to
carry out the provisions of this Section. | 19 | | (h) Any Illinois gas utility may enter into a contract on | 20 | | or before September 30, 2011 for up to 10 years of supply with | 21 | | any company for the purchase of substitute natural gas (SNG) | 22 | | produced from coal through the gasification process if the | 23 | | company has commenced construction of a clean coal SNG facility | 24 | | by July 1, 2012 and commencement of construction shall mean | 25 | | that material physical site work has occurred, such as site | 26 | | clearing and excavation, water runoff prevention, water |
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| 1 | | retention reservoir preparation, or foundation development. | 2 | | The contract shall contain the following provisions: (i) at | 3 | | least 90% of feedstock to be used in the gasification process | 4 | | shall be coal with a high volatile bituminous rank and greater | 5 | | than 1.7 pounds of sulfur per million Btu content; (ii) at the | 6 | | time the contract term commences, the price per million Btu may | 7 | | not exceed $7.95 in 2008 dollars, adjusted annually based on | 8 | | the change in the Annual Consumer Price Index for All Urban | 9 | | Consumers for the Midwest Region as published in April by the | 10 | | United States Department of Labor, Bureau of Labor Statistics | 11 | | (or a suitable Consumer Price Index calculation if this | 12 | | Consumer Price Index is not available) for the previous | 13 | | calendar year; provided that the price per million Btu shall | 14 | | not exceed $9.95 at any time during the contract; (iii) the | 15 | | utility's supply contract for the purchase of SNG does not | 16 | | exceed 15% of the annual system supply requirements of the | 17 | | utility as of 2008; and (iv) the contract costs pursuant to | 18 | | subsection (h-10) of this Section shall not include any | 19 | | lobbying expenses, charitable contributions, advertising, | 20 | | organizational memberships, carbon dioxide pipeline or | 21 | | sequestration expenses, or marketing expenses. | 22 | | Any gas utility that is providing service to more than | 23 | | 150,000 customers on August 2, 2011 (the effective date of | 24 | | Public Act 97-239) shall either elect to enter into a contract | 25 | | on or before September 30, 2011 for 10 years of SNG supply with | 26 | | the owner of a clean coal SNG facility or to file biennial rate |
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| 1 | | proceedings before the Commission in the years 2012, 2014, and | 2 | | 2016, with such filings made after August 2, 2011 and no later | 3 | | than September 30 of the years 2012, 2014, and 2016 consistent | 4 | | with all requirements of 83 Ill. Adm. Code 255 and 285 as | 5 | | though the gas utility were filing for an increase in its | 6 | | rates, without regard to whether such filing would produce an | 7 | | increase, a decrease, or no change in the gas utility's rates, | 8 | | and the Commission shall review the gas utility's filing and | 9 | | shall issue its order in accordance with the provisions of | 10 | | Section 9-201 of this Act. | 11 | | Within 7 days after August 2, 2011, the owner of the clean | 12 | | coal SNG facility shall submit to the Illinois Power Agency and | 13 | | each gas utility that is providing service to more than 150,000 | 14 | | customers on August 2, 2011 a copy of a draft contract. Within | 15 | | 30 days after the receipt of the draft contract, each such gas | 16 | | utility shall provide the Illinois Power Agency and the owner | 17 | | of the clean coal SNG facility with its comments and | 18 | | recommended revisions to the draft contract. Within 7 days | 19 | | after the receipt of the gas utility's comments and recommended | 20 | | revisions, the owner of the facility shall submit its | 21 | | responsive comments and a further revised draft of the contract | 22 | | to the Illinois Power Agency. The Illinois Power Agency shall | 23 | | review the draft contract and comments. | 24 | | During its review of the draft contract, the Illinois Power | 25 | | Agency shall: | 26 | | (1) review and confirm in writing that the terms stated |
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| 1 | | in this subsection (h) are incorporated in the SNG | 2 | | contract; | 3 | | (2) review the SNG pricing formula included in the | 4 | | contract and approve that formula if the Illinois Power | 5 | | Agency determines that the formula, at the time the | 6 | | contract term commences: (A) starts with a price of $6.50 | 7 | | per MMBtu adjusted by the adjusted final capitalized plant | 8 | | cost; (B) takes into account budgeted miscellaneous net | 9 | | revenue after cost allowance, including sale of SNG | 10 | | produced by the clean coal SNG facility above the nameplate | 11 | | capacity of the facility and other by-products produced by | 12 | | the facility, as approved by the Illinois Power Agency; (C) | 13 | | does not include carbon dioxide transportation or | 14 | | sequestration expenses; and (D) includes all provisions | 15 | | required under this subsection (h); if the Illinois Power | 16 | | Agency does not approve of the SNG pricing formula, then | 17 | | the Illinois Power Agency shall modify the formula to | 18 | | ensure that it meets the requirements of this subsection | 19 | | (h); | 20 | | (3) review and approve the amount of budgeted | 21 | | miscellaneous net revenue after cost allowance, including | 22 | | sale of SNG produced by the clean coal SNG facility above | 23 | | the nameplate capacity of the facility and other | 24 | | by-products produced by the facility, to be included in the | 25 | | pricing formula; the Illinois Power Agency shall approve | 26 | | the amount of budgeted miscellaneous net revenue to be |
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| 1 | | included in the pricing formula if it determines the | 2 | | budgeted amount to be reasonable and accurate; | 3 | | (4) review and confirm in writing that using the EIA | 4 | | Annual Energy Outlook-2011 Henry Hub Spot Price, the | 5 | | contract terms set out in subsection (h), the | 6 | | reconciliation account terms as set out in subsection | 7 | | (h-15), and an estimated inflation rate of 2.5% for each | 8 | | corresponding year, that there will be no cumulative | 9 | | estimated increase for residential customers; and | 10 | | (5) allocate the nameplate capacity of the clean coal | 11 | | SNG by total therms sold to ultimate customers by each gas | 12 | | utility in 2008; provided, however, no utility shall be | 13 | | required to purchase more than 42% of the projected annual | 14 | | output of the facility; additionally, the Illinois Power | 15 | | Agency shall further adjust the allocation only as required | 16 | | to take into account (A) adverse consolidation, | 17 | | derivative, or lease impacts to the balance sheet or income | 18 | | statement of any gas utility or (B) the physical capacity | 19 | | of the gas utility to accept SNG. | 20 | | If the parties to the contract do not agree on the terms | 21 | | therein, then the Illinois Power Agency shall retain an | 22 | | independent mediator to mediate the dispute between the | 23 | | parties. If the parties are in agreement on the terms of the | 24 | | contract, then the Illinois Power Agency shall approve the | 25 | | contract. If after mediation the parties have failed to come to | 26 | | agreement, then the Illinois Power Agency shall revise the |
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| 1 | | draft contract as necessary to confirm that the contract | 2 | | contains only terms that are reasonable and equitable. The | 3 | | Illinois Power Agency may, in its discretion, retain an | 4 | | independent, qualified, and experienced expert to assist in its | 5 | | obligations under this subsection (h). The Illinois Power | 6 | | Agency shall adopt and make public policies detailing the | 7 | | processes for retaining a mediator and an expert under this | 8 | | subsection (h). Any mediator or expert retained under this | 9 | | subsection (h) shall be retained no later than 60 days after | 10 | | August 2, 2011. | 11 | | The Illinois Power Agency shall complete all of its | 12 | | responsibilities under this subsection (h) within 60 days after | 13 | | August 2, 2011. The clean coal SNG facility shall pay a | 14 | | reasonable fee as required by the Illinois Power Agency for its | 15 | | services under this subsection (h) and shall pay the mediator's | 16 | | and expert's reasonable fees, if any. A gas utility and its | 17 | | customers shall have no obligation to reimburse the clean coal | 18 | | SNG facility or the Illinois Power Agency of any such costs. | 19 | | Within 30 days after commercial production of SNG has | 20 | | begun, the Commission shall initiate a review to determine | 21 | | whether the final capitalized plant cost of the clean coal SNG | 22 | | facility reflects actual incurred costs and whether the | 23 | | incurred costs were reasonable. In determining the actual | 24 | | incurred costs included in the final capitalized plant cost and | 25 | | the reasonableness of those costs, the Commission may in its | 26 | | discretion retain independent, qualified, and experienced |
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| 1 | | experts to assist in its determination. The expert shall not | 2 | | own or control any direct or indirect interest in the clean | 3 | | coal SNG facility and shall have no contractual relationship | 4 | | with the clean coal SNG facility. If an expert is retained by | 5 | | the Commission, then the clean coal SNG facility shall pay the | 6 | | expert's reasonable fees. The fees shall not be passed on to a | 7 | | utility or its customers. The Commission shall adopt and make | 8 | | public a policy detailing the process for retaining experts | 9 | | under this subsection (h). | 10 | | Within 30 days after completion of its review, the | 11 | | Commission shall initiate a formal proceeding on the final | 12 | | capitalized plant cost of the clean coal SNG facility at which | 13 | | comments and testimony may be submitted by any interested | 14 | | parties and the public. If the Commission finds that the final | 15 | | capitalized plant cost includes costs that were not actually | 16 | | incurred or costs that were unreasonably incurred, then the | 17 | | Commission shall disallow the amount of non-incurred or | 18 | | unreasonable costs from the SNG price under contracts entered | 19 | | into under this subsection (h). If the Commission disallows any | 20 | | costs, then the Commission shall adjust the SNG price using the | 21 | | price formula in the contract approved by the Illinois Power | 22 | | Agency under this subsection (h) to reflect the disallowed | 23 | | costs and shall enter an order specifying the revised price. In | 24 | | addition, the Commission's order shall direct the clean coal | 25 | | SNG facility to issue refunds of such sums as shall represent | 26 | | the difference between actual gross revenues and the gross |
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| 1 | | revenue that would have been obtained based upon the same | 2 | | volume, from the price revised by the Commission. Any refund | 3 | | shall include interest calculated at a rate determined by the | 4 | | Commission and shall be returned according to procedures | 5 | | prescribed by the Commission. | 6 | | Nothing in this subsection (h) shall preclude any party | 7 | | affected by a decision of the Commission under this subsection | 8 | | (h) from seeking judicial review of the Commission's decision. | 9 | | (h-1) Any Illinois gas utility may enter into a sourcing | 10 | | agreement for up to 30 years of supply with the clean coal SNG | 11 | | brownfield facility if the clean coal SNG brownfield facility | 12 | | has commenced construction. Any gas utility that is providing | 13 | | service to more than 150,000 customers on July 13, 2011 (the | 14 | | effective date of Public Act 97-096) shall either elect to file | 15 | | biennial rate proceedings before the Commission in the years | 16 | | 2012, 2014, and 2016 or enter into a sourcing agreement or | 17 | | sourcing agreements with a clean coal SNG brownfield facility | 18 | | with an initial term of 30 years for either (i) a percentage of | 19 | | 43,500,000,000 cubic feet per year, such that the utilities | 20 | | entering into sourcing agreements with the clean coal SNG | 21 | | brownfield facility purchase 100%,
allocated by total therms | 22 | | sold to ultimate customers by each
gas utility in 2008 or (ii) | 23 | | such lesser amount as may be available from the clean coal SNG | 24 | | brownfield facility; provided that no utility shall be required | 25 | | to purchase more than 42% of the projected annual output of the | 26 | | clean coal SNG brownfield facility, with the remainder of such |
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| 1 | | utility's obligation to be divided proportionately between the | 2 | | other utilities, and provided that the Illinois Power Agency | 3 | | shall
further adjust the allocation only as required to take | 4 | | into
account adverse consolidation, derivative, or lease | 5 | | impacts to
the balance sheet or income statement of any gas | 6 | | utility. | 7 | | A gas utility electing to file biennial rate proceedings | 8 | | before the Commission must file a notice of its election with | 9 | | the Commission within 60 days after July 13, 2011 or its right | 10 | | to make the election is irrevocably waived. A gas utility | 11 | | electing to file biennial rate proceedings shall make such | 12 | | filings no later than August 1 of the years 2012, 2014, and | 13 | | 2016, consistent with all requirements of 83 Ill. Adm. Code 255 | 14 | | and 285 as though the gas utility were filing for an increase | 15 | | in its rates, without regard to whether such filing would | 16 | | produce an increase, a decrease, or no change in the gas | 17 | | utility's rates, and notwithstanding any other provisions of | 18 | | this Act, the Commission shall fully review the gas utility's | 19 | | filing and shall issue its order in accordance with the | 20 | | provisions of Section 9-201 of this Act, regardless of whether | 21 | | the
Commission has approved a formula rate for the gas utility. | 22 | | Within 15 days after July 13, 2011, the owner of the clean | 23 | | coal SNG brownfield facility shall submit to the Illinois Power | 24 | | Agency and each gas utility that is providing service to more | 25 | | than 150,000 customers on July 13, 2011 a copy of a draft | 26 | | sourcing agreement. Within 45 days after receipt of the draft |
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| 1 | | sourcing agreement, each such gas utility shall provide the | 2 | | Illinois Power Agency and the owner of a clean coal SNG | 3 | | brownfield facility with its comments and recommended | 4 | | revisions to the draft sourcing agreement. Within 15 days after | 5 | | the receipt of the gas utility's comments and recommended | 6 | | revisions, the owner of the clean coal SNG brownfield facility | 7 | | shall submit its responsive comments and a further revised | 8 | | draft of the sourcing agreement to the Illinois Power Agency. | 9 | | The Illinois Power Agency shall review the draft sourcing | 10 | | agreement and comments. | 11 | | If the parties to the sourcing agreement do not agree on | 12 | | the terms therein, then the Illinois Power Agency shall retain | 13 | | an independent mediator to mediate the dispute between the | 14 | | parties. If the parties are in agreement on the terms of the | 15 | | sourcing agreement, the Illinois Power Agency shall approve the | 16 | | final draft sourcing agreement. If after mediation the parties | 17 | | have failed to come to agreement, then the Illinois Power | 18 | | Agency shall revise the draft sourcing agreement as necessary | 19 | | to confirm that the final draft sourcing agreement contains | 20 | | only terms that are reasonable and equitable. The Illinois | 21 | | Power Agency shall adopt and make public a policy detailing the | 22 | | process for retaining a mediator under this subsection (h-1). | 23 | | Any mediator retained to assist with mediating disputes between | 24 | | the parties regarding the sourcing agreement shall be retained | 25 | | no later than 60 days after July 13, 2011. | 26 | | Upon approval of a final draft agreement, the Illinois |
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| 1 | | Power Agency shall submit the final draft agreement to the | 2 | | Capital Development Board and the Commission no later than 90 | 3 | | days after July 13, 2011. The gas utility and the clean coal | 4 | | SNG brownfield facility shall pay a reasonable fee as required | 5 | | by the Illinois Power Agency for its services under this | 6 | | subsection (h-1) and shall pay the mediator's reasonable fees, | 7 | | if any. The Illinois Power Agency shall adopt and make public a | 8 | | policy detailing the process for retaining a mediator under | 9 | | this Section. | 10 | | The sourcing agreement between a gas utility and the clean | 11 | | coal SNG brownfield facility shall contain the following | 12 | | provisions: | 13 | | (1) Any and all coal used in the gasification process | 14 | | must be coal that has high volatile bituminous rank and | 15 | | greater than 1.7 pounds of sulfur per million Btu content. | 16 | | (2) Coal and petroleum coke are feedstocks for the | 17 | | gasification process, with coal comprising at least 50% of | 18 | | the total feedstock over the term of the sourcing agreement | 19 | | unless the facility reasonably determines that it is
| 20 | | necessary to use additional petroleum coke to deliver net
| 21 | | consumer savings, in which case the facility shall use
coal | 22 | | for at least 35% of the total feedstock over the
term of | 23 | | any sourcing agreement and with the feedstocks to be | 24 | | procured in accordance with requirements of Section 1-78 of | 25 | | the Illinois Power Agency Act. | 26 | | (3) The sourcing agreement has an initial term that |
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| 1 | | once entered into terminates no more than 30 years after | 2 | | the commencement of the commercial production of SNG at the | 3 | | clean coal SNG brownfield facility. | 4 | | (4) The clean coal SNG brownfield facility guarantees a | 5 | | minimum of $100,000,000 in consumer savings to customers of
| 6 | | the utilities that have entered into sourcing agreements
| 7 | | with the clean coal SNG brownfield facility, calculated in | 8 | | real 2010 dollars at the conclusion of the term of the | 9 | | sourcing agreement by comparing the delivered SNG price to | 10 | | the Chicago City-gate price on a weighted daily basis for | 11 | | each day over the entire term of the sourcing agreement, to | 12 | | be provided in accordance with subsection (h-2) of this | 13 | | Section. | 14 | | (5) Prior to the clean coal SNG brownfield facility | 15 | | issuing a notice to proceed to construction, the clean coal | 16 | | SNG brownfield facility shall establish a consumer | 17 | | protection reserve account for the benefit of the customers | 18 | | of the utilities that have entered into sourcing agreements | 19 | | with the clean coal SNG brownfield facility pursuant to | 20 | | this subsection (h-1), with cash principal in the amount of | 21 | | $150,000,000. This cash principal shall only be | 22 | | recoverable through the consumer protection reserve | 23 | | account and not as a cost to be recovered in the delivered | 24 | | SNG price pursuant to subsection (h-3) of this Section. The | 25 | | consumer protection reserve account shall be maintained | 26 | | and administered by an independent trustee that is mutually |
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| 1 | | agreed upon by the clean coal SNG brownfield facility, the | 2 | | utilities, and the Commission in an interest-bearing | 3 | | account in accordance with subsection (h-2) of this | 4 | | Section. | 5 | | "Consumer protection reserve account principal maximum | 6 | | amount" shall mean the maximum amount of principal to be | 7 | | maintained in the consumer protection reserve account. | 8 | | During the first 2 years of operation of the facility, | 9 | | there shall be no consumer protection reserve account | 10 | | maximum amount. After the first 2 years of operation of the | 11 | | facility, the consumer protection reserve account maximum | 12 | | amount shall be $150,000,000. After 5 years of operation, | 13 | | and every 5 years thereafter, the trustee shall calculate | 14 | | the 5-year average balance of the consumer protection | 15 | | reserve account. If the trustee determines that during the | 16 | | prior 5 years the consumer protection reserve account has | 17 | | had an average account balance of less than $75,000,000, | 18 | | then the consumer protection reserve account principal | 19 | | maximum amount shall be increased by $5,000,000. If the | 20 | | trustee determines that during the prior 5 years the | 21 | | consumer protection reserve account has had an average | 22 | | account balance of more than $75,000,000, then the consumer | 23 | | protection reserve account principal maximum amount shall | 24 | | be decreased by $5,000,000. | 25 | | (6) The clean coal SNG brownfield facility shall | 26 | | identify and sell economically viable by-products produced |
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| 1 | | by the facility. | 2 | | (7) Fifty percent of all additional net revenue, | 3 | | defined as miscellaneous net revenue from products | 4 | | produced by the
facility and delivered during the month | 5 | | after cost allowance for costs associated with additional | 6 | | net revenue that are not otherwise recoverable pursuant to | 7 | | subsection (h-3) of this Section, including net revenue | 8 | | from sales of substitute natural gas derived from the | 9 | | facility above the nameplate capacity of the facility and | 10 | | other by-products produced by the facility, shall be | 11 | | credited to the consumer protection reserve account | 12 | | pursuant to subsection (h-2) of this Section. | 13 | | (8) The delivered SNG price per million btu to be paid | 14 | | monthly by the utility to the clean coal SNG brownfield | 15 | | facility, which shall be based only upon the following: (A) | 16 | | a capital recovery charge, operations and maintenance | 17 | | costs, and sequestration costs, only to the extent approved | 18 | | by the Commission pursuant to paragraphs (1), (2), and (3) | 19 | | of subsection (h-3) of this Section; (B) the actual | 20 | | delivered and processed fuel costs pursuant to paragraph | 21 | | (4) of subsection (h-3) of this Section; (C) actual costs | 22 | | of SNG transportation pursuant to paragraph (6) of | 23 | | subsection (h-3) of this Section; (D) certain taxes and | 24 | | fees imposed by the federal government, the State, or any | 25 | | unit of local government as provided in paragraph (6) of | 26 | | subsection (h-3) of this Section; and (E) the credit, if |
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| 1 | | any, from the consumer protection reserve account pursuant | 2 | | to subsection (h-2) of this Section. The delivered SNG | 3 | | price per million Btu shall proportionately reflect these | 4 | | elements over the term of the sourcing agreement. | 5 | | (9) A formula to translate the recoverable costs and | 6 | | charges under subsection (h-3) of this Section into the | 7 | | delivered SNG price per million btu. | 8 | | (10) Title to the SNG shall pass at a mutually | 9 | | agreeable point in Illinois, and may provide that, rather | 10 | | than the utility taking title to the SNG, a mutually agreed | 11 | | upon third-party gas marketer pursuant to a contract | 12 | | approved by the Illinois Power Agency or its designee may | 13 | | take title to the SNG pursuant to an agreement between the | 14 | | utility, the owner of the clean coal SNG brownfield | 15 | | facility, and the third-party gas marketer. | 16 | | (11) A utility may exit the sourcing agreement without | 17 | | penalty if the clean coal SNG brownfield facility does not | 18 | | commence construction by July 1, 2015. | 19 | | (12) A utility is responsible to pay only the | 20 | | Commission determined unit price cost of SNG that is | 21 | | purchased by the utility. Nothing in the sourcing agreement | 22 | | will obligate a utility to invest capital in a clean coal | 23 | | SNG brownfield facility. | 24 | | (13) The quality of SNG must, at a minimum, be | 25 | | equivalent to the quality required for interstate pipeline | 26 | | gas before a utility is required to accept and pay for SNG |
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| 1 | | gas. | 2 | | (14) Nothing in the sourcing agreement will require a | 3 | | utility to construct any facilities to accept delivery of | 4 | | SNG. Provided, however, if a utility is required by law or | 5 | | otherwise elects to connect the clean coal SNG brownfield | 6 | | facility to an interstate pipeline, then the utility shall | 7 | | be entitled to recover pursuant to its tariffs all just and | 8 | | reasonable costs that are prudently incurred. Any costs | 9 | | incurred by the utility to receive, deliver, manage, or | 10 | | otherwise accommodate purchases under the SNG sourcing | 11 | | agreement will be fully recoverable through a utility's | 12 | | purchased gas adjustment clause rider mechanism in
| 13 | | conjunction with a SNG brownfield facility rider
| 14 | | mechanism. The SNG brownfield facility rider mechanism
(A) | 15 | | shall be applicable to all customers who receive
| 16 | | transportation service from the utility, (B) shall be
| 17 | | designed to have an equal percent impact on the
| 18 | | transportation services rates of each class of the
| 19 | | utility's customers, and (C) shall accurately reflect the
| 20 | | net consumer savings, if any, and above-market costs, if
| 21 | | any, associated with the utility receiving, delivering,
| 22 | | managing, or otherwise accommodating purchases under the
| 23 | | SNG sourcing agreement. | 24 | | (15) Remedies for the clean coal SNG brownfield | 25 | | facility's failure to deliver a designated amount for a | 26 | | designated period. |
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| 1 | | (16) The clean coal SNG brownfield facility shall
make | 2 | | a good faith effort to ensure that an amount equal
to not | 3 | | less than 15% of the value of its prime
construction | 4 | | contract for the facility shall be
established as a goal to | 5 | | be awarded to minority owned
businesses, female owned | 6 | | businesses, and businesses owned
by a person with a | 7 | | disability; provided that at least 75%
of the amount of | 8 | | such total goal shall be for minority
owned businesses. | 9 | | "Minority owned business", "female
owned business", and | 10 | | "business owned by a person with a
disability" shall have | 11 | | the meanings ascribed to them in
Section 2 of the Business | 12 | | Enterprise for Minorities,
Females and Persons with | 13 | | Disabilities Act. | 14 | | (17) Prior to the clean coal SNG brownfield facility | 15 | | issuing a notice to proceed to construction, the clean coal | 16 | | SNG brownfield facility shall file with the Commission a | 17 | | certificate from an independent engineer that the clean | 18 | | coal SNG brownfield facility has (A) obtained all | 19 | | applicable State and federal environmental permits | 20 | | required for construction; (B) obtained approval from the | 21 | | Commission of a carbon capture and sequestration plan; and | 22 | | (C) obtained all necessary permits required for | 23 | | construction for the transportation and sequestration of | 24 | | carbon dioxide as set forth in the Commission-approved | 25 | | carbon capture and sequestration plan. | 26 | | (h-2) Consumer protection reserve account. The clean coal |
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| 1 | | SNG brownfield facility shall guarantee a minimum of | 2 | | $100,000,000 in consumer savings to customers of the utilities
| 3 | | that have entered into sourcing agreements with the clean coal
| 4 | | SNG brownfield facility, calculated in real 2010 dollars at the | 5 | | conclusion of the term of the sourcing agreement by comparing | 6 | | the delivered SNG price to the Chicago City-gate price on a | 7 | | weighted daily basis for each day over the entire term of the | 8 | | sourcing agreement. Prior to the clean coal SNG brownfield | 9 | | facility issuing a notice to proceed to construction, the clean | 10 | | coal SNG brownfield facility shall establish a consumer | 11 | | protection reserve account for the benefit of the retail | 12 | | customers of the utilities that have entered into sourcing | 13 | | agreements with the clean coal SNG brownfield facility pursuant | 14 | | to subsection (h-1), with cash principal in the amount of | 15 | | $150,000,000. Such cash principal shall only be recovered | 16 | | through the consumer protection reserve account and not as a | 17 | | cost to be recovered in the delivered SNG price pursuant to | 18 | | subsection (h-3) of this Section. The consumer protection | 19 | | reserve account shall be maintained and administered by an | 20 | | independent trustee that is mutually agreed upon by the clean | 21 | | coal SNG brownfield facility, the utilities, and the Commission | 22 | | in an interest-bearing account in accordance with the | 23 | | following: | 24 | | (1) The clean coal SNG brownfield facility monthly | 25 | | shall calculate (A) the difference between the monthly | 26 | | delivered SNG price and the Chicago City-gate price, by |
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| 1 | | comparing the delivered SNG price, which shall include the | 2 | | cost of transportation to the delivery point, if any, to | 3 | | the Chicago City-gate price on a weighted daily basis for | 4 | | each day of the prior month based upon a mutually agreed | 5 | | upon published index and (B) the overage amount, if any, by
| 6 | | calculating the annualized incremental additional cost,
if | 7 | | any, of the delivered SNG in excess of 2.015% of the
| 8 | | average annual inflation-adjusted amounts paid by all gas
| 9 | | distribution customers in connection with natural gas
| 10 | | service during the 5 years ending May 31, 2010. | 11 | | (2) During the first 2 years of operation of the | 12 | | facility: | 13 | | (A) to the extent there is an overage amount, the | 14 | | consumer protection reserve account shall be used to | 15 | | provide a credit to reduce the SNG price by an amount | 16 | | equal to the overage amount; and | 17 | | (B) to the extent the monthly delivered SNG price | 18 | | is less than or equal to the Chicago City-gate price, | 19 | | the utility shall credit the difference between the | 20 | | monthly delivered SNG price and the monthly Chicago | 21 | | City-gate price, if any, to the consumer protection | 22 | | reserve account. Such credit issued pursuant to this | 23 | | paragraph (B) shall be deemed prudent and reasonable | 24 | | and not subject to a Commission prudence review; | 25 | | (3) After 2 years of operation of the facility, and | 26 | | monthly, on an on-going basis, thereafter: |
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| 1 | | (A) to the extent that the monthly delivered SNG | 2 | | price is less than or equal to the Chicago City-gate | 3 | | price, calculated using the weighted average of the | 4 | | daily Chicago City-gate price on a daily basis over the | 5 | | entire month, the utility shall credit the difference, | 6 | | if any, to the consumer protection reserve account. | 7 | | Such credit issued pursuant to this subparagraph (A) | 8 | | shall be deemed prudent and reasonable and not subject | 9 | | to a Commission prudence review; | 10 | | (B) any amounts in the consumer protection reserve | 11 | | account in excess of the consumer protection reserve | 12 | | account principal maximum amount shall be distributed | 13 | | as follows: (i) if retail customers have not realized
| 14 | | net consumer savings, calculated by comparing the
| 15 | | delivered SNG price to the weighted average of the
| 16 | | daily Chicago City-gate price on a daily basis over
the | 17 | | entire term of the sourcing agreement to date,
then 50% | 18 | | of any amounts in the consumer protection
reserve | 19 | | account in excess of the consumer protection reserve | 20 | | account principal maximum shall be
distributed to the | 21 | | clean coal SNG brownfield
facility, with the remaining | 22 | | 50% of any such
additional amounts being credited to | 23 | | retail
customers, and (ii) if retail customers have | 24 | | realized net
consumer savings, then 100% of any amounts | 25 | | in the
consumer protection reserve account in excess of
| 26 | | the consumer protection reserve account principal |
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| 1 | | maximum shall be distributed to the clean coal
SNG | 2 | | brownfield facility; provided, however, that under no | 3 | | circumstances shall the total cumulative amount | 4 | | distributed to the clean coal SNG brownfield facility | 5 | | under this subparagraph (B) exceed $150,000,000; | 6 | | (C) to the extent there is an overage amount, after | 7 | | distributing the amounts pursuant to subparagraph (B) | 8 | | of this paragraph (3), if any, the consumer protection | 9 | | reserve account shall be used to provide a credit to | 10 | | reduce the SNG price by an amount equal to the overage | 11 | | amount; | 12 | | (D) if retail customers have realized net consumer | 13 | | savings, calculated by comparing the delivered SNG | 14 | | price to the weighted average of the daily Chicago | 15 | | City-gate price on a daily basis over the entire term | 16 | | of the sourcing agreement to date, then after | 17 | | distributing the amounts pursuant to subparagraphs (B) | 18 | | and (C) of this paragraph (3), 50% of any additional | 19 | | amounts in the consumer protection reserve account in | 20 | | excess of the consumer protection reserve account | 21 | | principal maximum shall be distributed to the clean | 22 | | coal SNG brownfield facility, with the remaining 50% of | 23 | | any such additional amounts being credited to retail | 24 | | customers; provided, however, that if retail customers | 25 | | have not realized such net consumer savings, no such | 26 | | distribution shall be made to the clean coal SNG |
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| 1 | | brownfield facility, and 100% of such additional | 2 | | amounts shall be credited to the retail customers to | 3 | | the extent the consumer protection reserve account | 4 | | exceeds the consumer protection reserve account | 5 | | principal maximum amount. | 6 | | (4) Fifty percent of all additional net revenue, | 7 | | defined as miscellaneous net revenue after cost allowance | 8 | | for costs associated with additional net revenue that are | 9 | | not otherwise recoverable pursuant to subsection (h-3) of | 10 | | this Section, including net revenue from sales of | 11 | | substitute natural gas derived from the facility above the | 12 | | nameplate capacity of the facility and other by-products | 13 | | produced by the facility, shall be credited to the consumer | 14 | | protection reserve account. | 15 | | (5) At the conclusion of the term of the sourcing | 16 | | agreement, to the extent retail customers have not saved | 17 | | the minimum of $100,000,000 in consumer savings as | 18 | | guaranteed in this subsection (h-2), amounts in the | 19 | | consumer protection reserve account shall be credited to | 20 | | retail customers to the extent the retail customers have | 21 | | saved the minimum of $100,000,000; 50% of any additional | 22 | | amounts in the consumer protection reserve account shall be | 23 | | distributed to the company, and the remaining 50% shall be | 24 | | distributed to retail customers. | 25 | | (6) If, at the conclusion of the term of the sourcing | 26 | | agreement, the customers have not saved the minimum |
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| 1 | | $100,000,000 in savings as guaranteed in this subsection | 2 | | (h-2) and the consumer protection reserve account has been | 3 | | depleted, then the clean coal SNG brownfield facility shall | 4 | | be liable for any remaining amount owed to the retail | 5 | | customers to the extent that the customers are provided | 6 | | with the $100,000,000 in savings as guaranteed in this | 7 | | subsection (h-2). The retail customers shall have first | 8 | | priority in recovering that debt above any creditors, | 9 | | except the original senior secured lender to the extent | 10 | | that the original senior secured lender has any senior | 11 | | secured debt outstanding, including any clean coal SNG | 12 | | brownfield facility parent companies or affiliates. | 13 | | (7) The clean coal SNG brownfield facility, the | 14 | | utilities, and the trustee shall work together to take | 15 | | commercially reasonable steps to minimize the tax impact of | 16 | | these transactions, while preserving the consumer | 17 | | benefits. | 18 | | (8) The clean coal SNG brownfield facility shall each | 19 | | month, starting in the facility's first year of commercial | 20 | | operation, file with the Commission, in such form as the | 21 | | Commission shall require, a report as to the consumer | 22 | | protection reserve account. The monthly report must | 23 | | contain the following information: | 24 | | (A) the extent the monthly delivered SNG price is | 25 | | greater than, less than, or equal to the Chicago | 26 | | City-gate price; |
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| 1 | | (B) the amount credited or debited to the consumer | 2 | | protection reserve account during the month; | 3 | | (C) the amounts credited to consumers and | 4 | | distributed to the clean coal SNG brownfield facility | 5 | | during the month; | 6 | | (D) the total amount of the consumer protection | 7 | | reserve account at the beginning and end of the month; | 8 | | (E) the total amount of consumer savings to date; | 9 | | (F) a confidential summary of the inputs used to | 10 | | calculate the additional net revenue; and | 11 | | (G) any other additional information the | 12 | | Commission shall require. | 13 | | When any report is erroneous or defective or appears to | 14 | | the Commission to be erroneous or defective, the Commission | 15 | | may notify the clean coal SNG brownfield facility to amend | 16 | | the report within 30 days, and, before or after the | 17 | | termination of the 30-day period, the Commission may | 18 | | examine the trustee of the consumer protection reserve | 19 | | account or the officers, agents, employees, books, | 20 | | records, or accounts of the clean coal SNG brownfield | 21 | | facility and correct such items in the report as upon such | 22 | | examination the Commission may find defective or | 23 | | erroneous. All reports shall be under oath. | 24 | | All reports made to the Commission by the clean coal | 25 | | SNG brownfield facility and the contents of the reports | 26 | | shall be open to public inspection and shall be deemed a |
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| 1 | | public record under the Freedom of Information Act. Such | 2 | | reports shall be preserved in the office of the Commission. | 3 | | The Commission shall publish an annual summary of the | 4 | | reports prior to February 1 of the following year. The | 5 | | annual summary shall be made available to the public on the | 6 | | Commission's website and shall be submitted to the General | 7 | | Assembly. | 8 | | Any facility that fails to file a report required under | 9 | | this paragraph (8) to the Commission within the time | 10 | | specified or to make specific answer to any question | 11 | | propounded by the Commission within 30 days from the time | 12 | | it is lawfully required to do so, or within such further | 13 | | time not to exceed 90 days as may in its discretion be | 14 | | allowed by the Commission, shall pay a penalty of $500 to | 15 | | the Commission for each day it is in default. | 16 | | Any person who willfully makes any false report to the | 17 | | Commission or to any member, officer, or employee thereof, | 18 | | any person who willfully in a report withholds or fails to | 19 | | provide material information to which the Commission is | 20 | | entitled under this paragraph (8) and which information is | 21 | | either required to be filed by statute, rule, regulation, | 22 | | order, or decision of the Commission or has been requested | 23 | | by the Commission, and any person who willfully aids or | 24 | | abets such person shall be guilty of a Class A misdemeanor. | 25 | | (h-3) Recoverable costs and revenue by the clean coal SNG | 26 | | brownfield facility. |
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| 1 | | (1) A capital recovery charge approved by the | 2 | | Commission shall be recoverable by the clean coal SNG | 3 | | brownfield facility under a sourcing agreement. The | 4 | | capital recovery charge shall be comprised of capital costs | 5 | | and a reasonable rate of return. "Capital costs" means | 6 | | costs to be incurred in connection with the construction | 7 | | and development of a facility, as defined in Section 1-10 | 8 | | of the Illinois Power Agency Act, and such other costs as | 9 | | the Capital Development Board deems appropriate to be | 10 | | recovered in the capital recovery charge. | 11 | | (A) Capital costs. The Capital Development Board | 12 | | shall calculate a range of capital costs that it | 13 | | believes would be reasonable for the clean coal SNG | 14 | | brownfield facility to recover under the sourcing | 15 | | agreement. In making this determination, the Capital | 16 | | Development Board shall review the facility cost
| 17 | | report, if any, of the clean coal SNG brownfield
| 18 | | facility, adjusting the results based on the change in
| 19 | | the Annual Consumer Price Index for All Urban Consumers
| 20 | | for the Midwest Region as published in April by the
| 21 | | United States Department of Labor, Bureau of Labor
| 22 | | Statistics, the final draft of the sourcing agreement, | 23 | | and the rate of return approved by the Commission. In | 24 | | addition, the Capital Development Board may consult as | 25 | | much as it deems necessary with the clean coal SNG | 26 | | brownfield facility and conduct whatever research and |
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| 1 | | investigation it deems necessary. | 2 | | The Capital Development Board shall retain an | 3 | | engineering expert to assist in determining both the | 4 | | range of capital costs and the range of operations and | 5 | | maintenance costs that it believes would be reasonable | 6 | | for the clean coal SNG brownfield facility to recover | 7 | | under the sourcing agreement. Provided, however, that | 8 | | such expert shall: (i) not have been involved in the | 9 | | clean coal SNG brownfield facility's facility cost | 10 | | report, if any, (ii) not own or control any direct or | 11 | | indirect interest in the initial clean coal facility, | 12 | | and (iii) have no contractual relationship with the | 13 | | clean coal SNG brownfield facility. In order to qualify | 14 | | as an independent expert, a person or company must | 15 | | have: | 16 | | (i) direct previous experience conducting | 17 | | front-end engineering and design studies for | 18 | | large-scale energy facilities and administering | 19 | | large-scale energy operations and maintenance | 20 | | contracts, which may be particularized to the | 21 | | specific type of financing associated with the | 22 | | clean coal SNG brownfield facility; | 23 | | (ii) an advanced degree in economics, | 24 | | mathematics, engineering, or a related area of | 25 | | study; | 26 | | (iii) ten years of experience in the energy |
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| 1 | | sector, including construction and risk management | 2 | | experience; | 3 | | (iv) expertise in assisting companies with | 4 | | obtaining financing for large-scale energy | 5 | | projects, which may be particularized to the | 6 | | specific type of financing associated with the | 7 | | clean coal SNG brownfield facility; | 8 | | (v) expertise in operations and maintenance | 9 | | which may be particularized to the specific type of | 10 | | operations and maintenance associated with the | 11 | | clean coal SNG brownfield facility; | 12 | | (vi) expertise in credit and contract | 13 | | protocols; | 14 | | (vii) adequate resources to perform and | 15 | | fulfill the required functions and | 16 | | responsibilities; and | 17 | | (viii) the absence of a conflict of interest | 18 | | and inappropriate bias for or against an affected | 19 | | gas utility or the clean coal SNG brownfield | 20 | | facility. | 21 | | The clean coal SNG brownfield facility and the | 22 | | Illinois Power Agency shall cooperate with the Capital | 23 | | Development Board in any investigation it deems | 24 | | necessary. The Capital Development Board shall make | 25 | | its final determination of the range of capital costs | 26 | | confidentially and shall submit that range to the |
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| 1 | | Commission in a confidential filing within 120 days | 2 | | after July 13, 2011 (the effective date of Public Act | 3 | | 97-096). The clean coal SNG brownfield facility shall | 4 | | submit to the Commission its estimate of the capital | 5 | | costs to be recovered under the sourcing agreement. | 6 | | Only after the clean coal SNG brownfield facility has | 7 | | submitted this estimate shall the Commission publicly | 8 | | announce the range of capital costs submitted by the | 9 | | Capital Development Board. | 10 | | In the event that the estimate submitted by the | 11 | | clean coal SNG brownfield facility is within or below | 12 | | the range submitted by the Capital Development Board, | 13 | | the clean coal SNG brownfield facility's estimate | 14 | | shall be approved by the Commission as the amount of | 15 | | capital costs to be recovered under the sourcing | 16 | | agreement. In the event that the estimate submitted by | 17 | | the clean coal SNG brownfield facility is above the | 18 | | range submitted by the Capital Development Board, the | 19 | | amount of capital costs at the lowest end of the range | 20 | | submitted by the Capital Development Board shall be | 21 | | approved by the Commission as the amount of capital | 22 | | costs to be recovered under the sourcing agreement. | 23 | | Within 15 days after the Capital Development Board has | 24 | | submitted its range and the clean coal SNG brownfield | 25 | | facility has submitted its estimate, the Commission | 26 | | shall approve the capital costs for the clean coal SNG |
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| 1 | | brownfield facility. | 2 | | The Capital Development Board shall monitor the | 3 | | construction of the clean coal SNG brownfield facility | 4 | | for the full duration of construction to assess | 5 | | potential cost overruns. The Capital Development | 6 | | Board, in its discretion, may retain an expert to | 7 | | facilitate such monitoring. The clean coal SNG | 8 | | brownfield facility shall pay a reasonable fee as | 9 | | required by the Capital Development Board for the | 10 | | Capital Development Board's services under this | 11 | | subsection (h-3) to be deposited into the Capital | 12 | | Development Board Revolving Fund, and such fee shall | 13 | | not be passed through to a utility or its customers. If | 14 | | an expert is retained by the Capital Development Board | 15 | | for monitoring of construction, then the clean coal SNG | 16 | | brownfield facility must pay for the expert's | 17 | | reasonable fees and such costs shall not be passed | 18 | | through to a utility or its customers. | 19 | | (B) Rate of Return. No later than 30 days after the | 20 | | date on which the Illinois Power Agency submits a final | 21 | | draft sourcing agreement, the Commission shall hold a | 22 | | public hearing to determine the rate of return to be | 23 | | recovered under the sourcing agreement. Rate of return | 24 | | shall be comprised of the clean coal SNG brownfield | 25 | | facility's actual cost of debt, including | 26 | | mortgage-style amortization, and a reasonable return |
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| 1 | | on equity. The Commission shall post notice of the | 2 | | hearing on its website no later than 10 days prior to | 3 | | the date of the hearing. The Commission shall provide | 4 | | the public and all interested parties, including the | 5 | | gas utilities, the Attorney General, and the Illinois | 6 | | Power Agency, an opportunity to be heard. | 7 | | In determining the return on equity, the | 8 | | Commission shall select a commercially reasonable | 9 | | return on equity taking into account the return on | 10 | | equity being received by developers of similar | 11 | | facilities in or outside of Illinois, the need to | 12 | | balance an incentive for clean-coal technology with | 13 | | the need to protect ratepayers from high gas prices, | 14 | | the risks being borne by the clean coal SNG brownfield | 15 | | facility in the final draft sourcing agreement, and any | 16 | | other information that the Commission may deem | 17 | | relevant. The Commission may establish a return on | 18 | | equity that varies with the amount of savings, if any, | 19 | | to customers during the term of the sourcing agreement, | 20 | | comparing the delivered SNG price to a daily weighted | 21 | | average price of natural gas, based upon an index. The | 22 | | Illinois Power Agency shall recommend a return on | 23 | | equity to the Commission using the same criteria. | 24 | | Within 60 days after receiving the final draft sourcing | 25 | | agreement from the Illinois Power Agency, the | 26 | | Commission shall approve the rate of return for the |
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| 1 | | clean coal brownfield facility. Within 30 days after | 2 | | obtaining debt financing for the clean coal SNG | 3 | | brownfield facility, the clean coal SNG brownfield | 4 | | facility shall file a notice with the Commission | 5 | | identifying the actual cost of debt. | 6 | | (2) Operations and maintenance costs approved by the | 7 | | Commission shall be recoverable by the clean coal SNG | 8 | | brownfield facility under the sourcing agreement. The | 9 | | operations and maintenance costs mean costs that have been | 10 | | incurred for the administration, supervision, operation, | 11 | | maintenance, preservation, and protection of the clean | 12 | | coal SNG brownfield facility's physical plant. | 13 | | The Capital Development Board shall calculate a range | 14 | | of operations and maintenance costs that it believes would | 15 | | be reasonable for the clean coal SNG brownfield facility to | 16 | | recover under the sourcing agreement, incorporating an
| 17 | | inflation index or combination of inflation indices to
most | 18 | | accurately reflect the actual costs of operating the
clean | 19 | | coal SNG brownfield facility. In making this | 20 | | determination, the Capital Development Board shall review | 21 | | the facility cost report, if any, of the clean coal SNG
| 22 | | brownfield facility, adjusting the results for inflation
| 23 | | based on the change in the Annual Consumer Price Index for
| 24 | | All Urban Consumers for the Midwest Region as published in
| 25 | | April by the United States Department of Labor, Bureau of
| 26 | | Labor Statistics, the final draft of the sourcing |
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| 1 | | agreement, and the rate of return approved by the | 2 | | Commission. In addition, the Capital Development Board may | 3 | | consult as much as it deems necessary with the clean coal | 4 | | SNG brownfield facility and conduct whatever research and | 5 | | investigation it deems necessary. As set forth in | 6 | | subparagraph (A) of paragraph (1) of this subsection (h-3), | 7 | | the Capital Development Board shall retain an independent | 8 | | engineering expert to assist in determining both the range | 9 | | of operations and maintenance costs that it believes would | 10 | | be reasonable for the clean coal SNG brownfield facility to | 11 | | recover under the sourcing agreement. The clean coal SNG | 12 | | brownfield facility and the Illinois Power Agency shall | 13 | | cooperate with the Capital Development Board in any | 14 | | investigation it deems necessary. The Capital Development | 15 | | Board shall make its final determination of the range of | 16 | | operations and maintenance costs confidentially and shall | 17 | | submit that range to the Commission in a confidential | 18 | | filing within 120 days after July 13, 2011. | 19 | | The clean coal SNG brownfield facility shall submit to | 20 | | the Commission its estimate of the operations and | 21 | | maintenance costs to be recovered under the sourcing | 22 | | agreement. Only after the clean coal SNG brownfield | 23 | | facility has submitted this estimate shall the Commission | 24 | | publicly announce the range of operations and maintenance | 25 | | costs submitted by the Capital Development Board. In the | 26 | | event that the estimate submitted by the clean coal SNG |
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| 1 | | brownfield facility is within or below the range submitted | 2 | | by the Capital Development Board, the clean coal SNG | 3 | | brownfield facility's estimate shall be approved by the | 4 | | Commission as the amount of operations and maintenance | 5 | | costs to be recovered under the sourcing agreement. In the | 6 | | event that the estimate submitted by the clean coal SNG | 7 | | brownfield facility is above the range submitted by the | 8 | | Capital Development Board, the amount of operations and | 9 | | maintenance costs at the lowest end of the range submitted | 10 | | by the Capital Development Board shall be approved by the | 11 | | Commission as the amount of operations and maintenance | 12 | | costs to be recovered under the sourcing agreement. Within | 13 | | 15 days after the Capital Development Board has submitted | 14 | | its range and the clean coal SNG brownfield facility has | 15 | | submitted its estimate, the Commission shall approve the | 16 | | operations and maintenance costs for the clean coal SNG | 17 | | brownfield facility. | 18 | | The clean coal SNG brownfield facility shall pay for | 19 | | the independent engineering expert's reasonable fees and | 20 | | such costs shall not be passed through to a utility or its | 21 | | customers. The clean coal SNG brownfield facility shall pay | 22 | | a reasonable fee as required by the Capital Development | 23 | | Board for the Capital Development Board's services under | 24 | | this subsection (h-3) to be deposited into the Capital | 25 | | Development Board Revolving Fund, and such fee shall not be | 26 | | passed through to a utility or its customers. |
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| 1 | | (3) Sequestration costs approved by the Commission | 2 | | shall be recoverable by the clean coal SNG brownfield | 3 | | facility. "Sequestration costs" means costs to be incurred | 4 | | by the clean coal SNG brownfield facility in accordance | 5 | | with its Commission-approved carbon capture and | 6 | | sequestration plan to: | 7 | | (A) capture carbon dioxide; | 8 | | (B) build, operate, and maintain a sequestration | 9 | | site in which carbon dioxide may be injected; | 10 | | (C) build, operate, and maintain a carbon dioxide | 11 | | pipeline; and | 12 | | (D) transport the carbon dioxide to the | 13 | | sequestration site or a pipeline. | 14 | | The Commission shall assess the prudency of the | 15 | | sequestration costs for the clean coal SNG brownfield | 16 | | facility before construction commences at the | 17 | | sequestration site or pipeline. Any revenues the clean coal | 18 | | SNG brownfield facility receives as a result of the | 19 | | capture, transportation, or sequestration of carbon | 20 | | dioxide shall be first credited against all sequestration | 21 | | costs, with the positive balance, if any, treated as | 22 | | additional net revenue. | 23 | | The Commission may, in its discretion, retain an expert | 24 | | to assist in its review of sequestration costs. The clean | 25 | | coal SNG brownfield facility shall pay for the expert's | 26 | | reasonable fees if an expert is retained by the Commission, |
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| 1 | | and such costs shall not be passed through to a utility or | 2 | | its customers. Once made, the Commission's determination | 3 | | of the amount of recoverable sequestration costs shall not | 4 | | be increased unless the clean coal SNG brownfield facility | 5 | | can show by clear and convincing evidence that (i) the | 6 | | costs were not reasonably foreseeable; (ii) the costs were | 7 | | due to circumstances beyond the clean coal SNG brownfield | 8 | | facility's control; and (iii) the clean coal SNG brownfield | 9 | | facility took all reasonable steps to mitigate the costs. | 10 | | If the Commission determines that sequestration costs may | 11 | | be increased, the Commission shall provide for notice and a | 12 | | public hearing for approval of the increased sequestration | 13 | | costs. | 14 | | (4) Actual delivered and processed fuel costs shall be | 15 | | set by the Illinois Power Agency through a SNG feedstock | 16 | | procurement, pursuant to Sections 1-20, 1-77, and 1-78 of | 17 | | the Illinois Power Agency Act, to be performed at least | 18 | | every 5 years and purchased by the clean coal SNG | 19 | | brownfield facility pursuant to feedstock procurement | 20 | | contracts developed by the Illinois Power Agency, with coal | 21 | | comprising at least 50% of the total feedstock over the | 22 | | term of the sourcing agreement and petroleum coke | 23 | | comprising the remainder of the SNG feedstock. If the | 24 | | Commission fails to approve a feedstock procurement plan or | 25 | | fails to approve the results of a feedstock procurement | 26 | | event, then the fuel shall be purchased by the company |
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| 1 | | month-by-month on the spot market and those actual | 2 | | delivered and processed fuel costs shall be recoverable | 3 | | under the sourcing agreement. If a supplier defaults under | 4 | | the terms of a procurement contract, then the Illinois | 5 | | Power Agency shall immediately initiate a feedstock | 6 | | procurement process to obtain a replacement supply, and, | 7 | | prior to the conclusion of that process, fuel shall be | 8 | | purchased by the company month-by-month on the spot market | 9 | | and those actual delivered and processed fuel costs shall | 10 | | be recoverable under the sourcing agreement. | 11 | | (5) Taxes and fees imposed by the federal government, | 12 | | the State, or any unit of local government applicable to | 13 | | the clean coal SNG brownfield facility, excluding income | 14 | | tax, shall be recoverable by the clean coal SNG brownfield | 15 | | facility under the sourcing agreement to the extent such | 16 | | taxes and fees were not applicable to the facility on July | 17 | | 13, 2011. | 18 | | (6) The actual transportation costs, in accordance | 19 | | with the applicable utility's tariffs, and third-party | 20 | | marketer costs incurred by the company, if any, associated | 21 | | with transporting the SNG from the clean coal SNG | 22 | | brownfield facility to the Chicago City-gate to sell such | 23 | | SNG into the natural gas markets shall be recoverable under | 24 | | the sourcing agreement. | 25 | | (7) Unless otherwise provided, within 30 days after a | 26 | | decision of the Commission on recoverable costs under this |
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| 1 | | Section, any interested party to the Commission's decision | 2 | | may apply for a rehearing with respect to the decision. The | 3 | | Commission shall receive and consider the application for | 4 | | rehearing and shall grant or deny the application in whole | 5 | | or in part within 20 days after the date of the receipt of | 6 | | the application by the Commission. If no rehearing is | 7 | | applied for within the required 30 days or an application | 8 | | for rehearing is denied, then the Commission decision shall | 9 | | be final. If an application for rehearing is granted, then | 10 | | the Commission shall hold a rehearing within 30 days after | 11 | | granting the application. The decision of the Commission | 12 | | upon rehearing shall be final. | 13 | | Any person affected by a decision of the Commission | 14 | | under this subsection (h-3) may have the decision reviewed | 15 | | only under and in accordance with the Administrative Review | 16 | | Law. Unless otherwise provided, the provisions of the | 17 | | Administrative Review Law, all amendments and | 18 | | modifications to that Law, and the rules adopted pursuant | 19 | | to that Law shall apply to and govern all proceedings for | 20 | | the judicial review of final administrative decisions of | 21 | | the Commission under this subsection (h-3). The term | 22 | | "administrative decision" is defined as in Section 3-101 of | 23 | | the Code of Civil Procedure. | 24 | | (8) The Capital Development Board shall adopt and make | 25 | | public a policy detailing the process for retaining experts | 26 | | under this Section. Any experts retained to assist with |
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| 1 | | calculating the range of capital costs or operations and | 2 | | maintenance costs shall be retained no later than 45 days | 3 | | after July 13, 2011. | 4 | | (h-4) No later than 90 days after the Illinois Power Agency | 5 | | submits the final draft sourcing agreement pursuant to | 6 | | subsection (h-1), the Commission shall approve a sourcing | 7 | | agreement containing (i) the capital costs, rate of return, and | 8 | | operations and maintenance costs established pursuant to | 9 | | subsection (h-3) and (ii) all other terms and conditions, | 10 | | rights, provisions, exceptions, and limitations contained in | 11 | | the final draft sourcing agreement; provided, however, the | 12 | | Commission shall correct typographical and scrivener's errors | 13 | | and modify the contract only as necessary to provide that the | 14 | | gas utility does not have the right to terminate the sourcing | 15 | | agreement due to any future events that may occur other than | 16 | | the clean coal SNG brownfield facility's failure to timely meet | 17 | | milestones, uncured default, extended force majeure, or | 18 | | abandonment. Once the sourcing agreement is approved, then the | 19 | | gas utility subject to that sourcing agreement shall have 45 | 20 | | days after the date of the Commission's approval to enter into | 21 | | the sourcing agreement. | 22 | | (h-5) Sequestration enforcement. | 23 | | (A) All contracts entered into under subsection (h) of | 24 | | this Section and all sourcing agreements under subsection | 25 | | (h-1) of this Section, regardless of duration, shall | 26 | | require the owner of any facility supplying SNG under the |
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| 1 | | contract or sourcing agreement to provide certified | 2 | | documentation to the Commission each year, starting in the | 3 | | facility's first year of commercial operation, accurately | 4 | | reporting the quantity of carbon dioxide emissions from the | 5 | | facility that have been captured and sequestered and | 6 | | reporting any quantities of carbon dioxide released from | 7 | | the site or sites at which carbon dioxide emissions were | 8 | | sequestered in prior years, based on continuous monitoring | 9 | | of those sites. | 10 | | (B) If, in any year, the owner of the clean coal SNG | 11 | | facility fails to demonstrate that the SNG facility | 12 | | captured and sequestered at least 90% of the total carbon | 13 | | dioxide emissions that the facility would otherwise emit or | 14 | | that sequestration of emissions from prior years has | 15 | | failed, resulting in the release of carbon dioxide into the | 16 | | atmosphere, then the owner of the clean coal SNG facility | 17 | | must pay a penalty of $20 per ton of excess carbon dioxide | 18 | | emissions not to exceed $40,000,000, in any given year | 19 | | which shall be deposited into the Energy Efficiency Trust | 20 | | Fund and distributed pursuant to subsection (b) of Section | 21 | | 6-6 of the Renewable Energy, Energy Efficiency, and Coal | 22 | | Resources Development Law of 1997. On or before the 5-year | 23 | | anniversary of the execution of the contract and every 5 | 24 | | years thereafter, an expert hired by the owner of the | 25 | | facility with the approval of the Attorney General shall | 26 | | conduct an analysis to determine the cost of sequestration |
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| 1 | | of at least 90% of the total carbon dioxide emissions the | 2 | | plant would otherwise emit. If the analysis shows that the | 3 | | actual annual cost is greater than the penalty, then the | 4 | | penalty shall be increased to equal the actual cost. | 5 | | Provided, however, to the extent that the owner of the | 6 | | facility described in subsection (h) of this Section can | 7 | | demonstrate that the failure was as a result of acts of God | 8 | | (including fire, flood, earthquake, tornado, lightning, | 9 | | hurricane, or other natural disaster); any amendment, | 10 | | modification, or abrogation of any applicable law or | 11 | | regulation that would prevent performance; war; invasion; | 12 | | act of foreign enemies; hostilities (regardless of whether | 13 | | war is declared); civil war; rebellion; revolution; | 14 | | insurrection; military or usurped power or confiscation; | 15 | | terrorist activities; civil disturbance; riots; | 16 | | nationalization; sabotage; blockage; or embargo, the owner | 17 | | of the facility described in subsection (h) of this Section | 18 | | shall not be subject to a penalty if and only if (i) it | 19 | | promptly provides notice of its failure to the Commission; | 20 | | (ii) as soon as practicable and consistent with any order | 21 | | or direction from the Commission, it submits to the | 22 | | Commission proposed modifications to its carbon capture | 23 | | and sequestration plan; and (iii) it carries out its | 24 | | proposed modifications in the manner and time directed by | 25 | | the Commission. | 26 | | If the Commission finds that the facility has not |
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| 1 | | satisfied each of these requirements, then the facility | 2 | | shall be subject to the penalty. If the owner of the clean | 3 | | coal SNG facility captured and sequestered more than 90% of | 4 | | the total carbon dioxide emissions that the facility would | 5 | | otherwise emit, then the owner of the facility may credit | 6 | | such additional amounts to reduce the amount of any future | 7 | | penalty to be paid. The penalty resulting from the failure | 8 | | to capture and sequester at least the minimum amount of | 9 | | carbon dioxide shall not be passed on to a utility or its | 10 | | customers. | 11 | | If the clean coal SNG facility fails to meet the | 12 | | requirements specified in this subsection (h-5), then the | 13 | | Attorney General, on behalf of the People of the State of | 14 | | Illinois, shall bring an action to enforce the obligations | 15 | | related to the facility set forth in this subsection (h-5), | 16 | | including any penalty payments owed, but not including the | 17 | | physical obligation to capture and sequester at least 90% | 18 | | of the total carbon dioxide emissions that the facility | 19 | | would otherwise emit. Such action may be filed in any | 20 | | circuit court in Illinois. By entering into a contract | 21 | | pursuant to subsection (h) of this Section, the clean coal | 22 | | SNG facility agrees to waive any objections to venue or to | 23 | | the jurisdiction of the court with regard to the Attorney | 24 | | General's action under this subsection (h-5). | 25 | | Compliance with the sequestration requirements and any | 26 | | penalty requirements specified in this subsection (h-5) |
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| 1 | | for the clean coal SNG facility shall be assessed annually | 2 | | by the Commission, which may in its discretion retain an | 3 | | expert to facilitate its assessment. If any expert is | 4 | | retained by the Commission, then the clean coal SNG | 5 | | facility shall pay for the expert's reasonable fees, and | 6 | | such costs shall not be passed through to the utility or | 7 | | its customers. | 8 | | In addition, carbon dioxide emission credits received | 9 | | by the clean coal SNG facility in connection with | 10 | | sequestration of carbon dioxide from the facility must be | 11 | | sold in a timely fashion with any revenue, less applicable | 12 | | fees and expenses and any expenses required to be paid by | 13 | | facility for carbon dioxide transportation or | 14 | | sequestration, deposited into the reconciliation account | 15 | | within 30 days after receipt of such funds by the owner of | 16 | | the clean coal SNG facility. | 17 | | The clean coal SNG facility is prohibited from | 18 | | transporting or sequestering carbon dioxide unless the | 19 | | owner of the carbon dioxide pipeline that transfers the | 20 | | carbon dioxide from the facility and the owner of the | 21 | | sequestration site where the carbon dioxide captured by the | 22 | | facility is stored has acquired all applicable permits | 23 | | under applicable State and federal laws, statutes, rules, | 24 | | or regulations prior to the transfer or sequestration of | 25 | | carbon dioxide. The responsibility for compliance with the | 26 | | sequestration requirements specified in this subsection |
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| 1 | | (h-5) for the clean coal SNG facility shall reside solely | 2 | | with the clean coal SNG facility, regardless of whether the | 3 | | facility has contracted with another party to capture, | 4 | | transport, or sequester carbon dioxide. | 5 | | (C) If, in any year, the owner of a clean coal SNG | 6 | | brownfield facility fails to demonstrate that the clean | 7 | | coal SNG brownfield facility captured and sequestered at | 8 | | least 85% of the total carbon dioxide emissions that the | 9 | | facility would otherwise emit, then the owner of the clean | 10 | | coal SNG brownfield facility must pay a penalty of $20 per | 11 | | ton of excess carbon emissions up to $20,000,000, which | 12 | | shall be deposited into the Energy Efficiency Trust Fund | 13 | | and distributed pursuant to subsection (b) of Section 6-6 | 14 | | of the Renewable Energy, Energy Efficiency, and Coal | 15 | | Resources Development Law of 1997. Provided, however, to | 16 | | the extent that the owner of the clean coal SNG brownfield | 17 | | facility can demonstrate that the failure was as a result | 18 | | of acts of God (including fire, flood, earthquake, tornado, | 19 | | lightning, hurricane, or other natural disaster); any | 20 | | amendment, modification, or abrogation of any applicable | 21 | | law or regulation that would prevent performance; war; | 22 | | invasion; act of foreign enemies; hostilities (regardless | 23 | | of whether war is declared); civil war; rebellion; | 24 | | revolution; insurrection; military or usurped power or | 25 | | confiscation; terrorist activities; civil disturbances; | 26 | | riots; nationalization; sabotage; blockage; or embargo, |
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| 1 | | the owner of the clean coal SNG brownfield facility shall | 2 | | not be subject to a penalty if and only if (i) it promptly | 3 | | provides notice of its failure to the Commission; (ii) as | 4 | | soon as practicable and consistent with any order or | 5 | | direction from the Commission, it submits to the Commission | 6 | | proposed modifications to its carbon capture and | 7 | | sequestration plan; and (iii) it carries out its proposed | 8 | | modifications in the manner and time directed by the | 9 | | Commission. If the Commission finds that the facility has | 10 | | not satisfied each of these requirements, then the facility | 11 | | shall be subject to the penalty. If the owner of a clean | 12 | | coal SNG brownfield facility demonstrates that the clean | 13 | | coal SNG brownfield facility captured and sequestered more | 14 | | than 85% of the total carbon emissions that the facility | 15 | | would otherwise emit, the owner of the clean coal SNG | 16 | | brownfield facility may credit such additional amounts to | 17 | | reduce the amount of any future penalty to be paid. The | 18 | | penalty resulting from the failure to capture and sequester | 19 | | at least the minimum amount of carbon dioxide shall not be | 20 | | passed on to a utility or its customers. | 21 | | In addition to any penalty for the clean coal SNG | 22 | | brownfield facility's failure to capture and sequester at | 23 | | least its minimum sequestration requirement, the Attorney | 24 | | General, on behalf of the People of the State of Illinois, | 25 | | shall bring an action for specific performance of this | 26 | | subsection (h-5). Such action may be filed in any circuit |
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| 1 | | court in Illinois. By entering into a sourcing agreement | 2 | | pursuant to subsection (h-1) of this Section, the clean | 3 | | coal SNG brownfield facility agrees to waive any objections | 4 | | to venue or to the jurisdiction of the court with regard to | 5 | | the Attorney General's action for specific performance | 6 | | under this subsection (h-5). | 7 | | Compliance with the sequestration requirements and | 8 | | penalty requirements specified in this subsection (h-5) | 9 | | for the clean coal SNG brownfield facility shall be | 10 | | assessed annually by the Commission, which may in its | 11 | | discretion retain an expert to facilitate its assessment. | 12 | | If an expert is retained by the Commission, then the clean | 13 | | coal SNG brownfield facility shall pay for the expert's | 14 | | reasonable fees, and such costs shall not be passed through | 15 | | to a utility or its customers. | 16 | | Responsibility for compliance with the sequestration | 17 | | requirements specified in this subsection (h-5) for the | 18 | | clean coal SNG brownfield facility shall reside solely with | 19 | | the clean coal SNG brownfield facility regardless of | 20 | | whether the facility has contracted with another party to | 21 | | capture, transport, or sequester carbon dioxide. | 22 | | (h-7) Sequestration permitting, oversight, and | 23 | | investigations. | 24 | | (1) No clean coal facility or clean coal SNG brownfield | 25 | | facility may transport or sequester carbon dioxide unless | 26 | | the Commission approves the method of carbon dioxide |
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| 1 | | transportation or sequestration. Such approval shall be | 2 | | required regardless of whether the facility has contracted | 3 | | with another to transport or sequester the carbon dioxide. | 4 | | Nothing in this subsection (h-7) shall release the owner or | 5 | | operator of a carbon dioxide sequestration site or carbon | 6 | | dioxide pipeline from any other permitting requirements | 7 | | under applicable State and federal laws, statutes, rules, | 8 | | or regulations. | 9 | | (2) The Commission shall review carbon dioxide | 10 | | transportation and sequestration methods proposed by a | 11 | | clean coal facility or a clean coal SNG brownfield facility | 12 | | and shall approve those methods it deems reasonable and | 13 | | cost-effective. For purposes of this review, | 14 | | "cost-effective" means a commercially reasonable price for | 15 | | similar carbon dioxide transportation or sequestration | 16 | | techniques. In determining whether sequestration is | 17 | | reasonable and cost-effective, the Commission may consult | 18 | | with the Illinois State Geological Survey and retain third | 19 | | parties to assist in its determination, provided that such | 20 | | third parties shall not own or control any direct or | 21 | | indirect interest in the facility that is proposing the | 22 | | carbon dioxide transportation or the carbon dioxide | 23 | | sequestration method and shall have no contractual | 24 | | relationship with that facility. If a third party is | 25 | | retained by the Commission, then the facility proposing the | 26 | | carbon dioxide transportation or sequestration method |
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| 1 | | shall pay for the expert's reasonable fees, and these costs | 2 | | shall not be passed through to a utility or its customers. | 3 | | No later than 6 months prior to the date upon which the | 4 | | owner intends to commence construction of a clean coal | 5 | | facility or the clean coal SNG brownfield facility, the | 6 | | owner of the facility shall file with the Commission a | 7 | | carbon dioxide transportation or sequestration plan. The | 8 | | Commission shall hold a public hearing within 30 days after | 9 | | receipt of the facility's carbon dioxide transportation or | 10 | | sequestration plan. The Commission shall post notice of the | 11 | | review on its website upon submission of a carbon dioxide | 12 | | transportation or sequestration method and shall accept | 13 | | written public comments. The Commission shall take the | 14 | | comments into account when making its decision. | 15 | | The Commission may not approve a carbon dioxide | 16 | | sequestration method if the owner or operator of the | 17 | | sequestration site has not received (i) an Underground | 18 | | Injection Control permit from the Illinois Environmental | 19 | | Protection Agency pursuant to the Environmental Protection | 20 | | Act; (ii) an Underground Injection Control permit from the | 21 | | Illinois Department of Natural Resources pursuant to the | 22 | | Illinois Oil and Gas Act; or (iii) a permit similar to | 23 | | items (i) or (ii) from the state in which the sequestration | 24 | | site is located if the sequestration will take place | 25 | | outside of Illinois. The Commission shall approve or deny | 26 | | the carbon dioxide transportation or sequestration method |
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| 1 | | within 90 days after the receipt of all required | 2 | | information. | 3 | | (3) At least annually, the Illinois Environmental | 4 | | Protection Agency shall inspect all carbon dioxide | 5 | | sequestration sites in Illinois. The Illinois | 6 | | Environmental Protection Agency may, as often as deemed | 7 | | necessary, monitor and conduct investigations of those | 8 | | sites. The owner or operator of the sequestration site must | 9 | | cooperate with the Illinois Environmental Protection | 10 | | Agency investigations of carbon dioxide sequestration | 11 | | sites. | 12 | | If the Illinois Environmental Protection Agency | 13 | | determines at any time a site creates conditions that | 14 | | warrant the issuance of a seal order under Section 34 of | 15 | | the Environmental Protection Act, then the Illinois | 16 | | Environmental Protection Agency shall seal the site | 17 | | pursuant to the Environmental Protection Act. If the | 18 | | Illinois Environmental Protection Agency determines at any | 19 | | time a carbon dioxide sequestration site creates | 20 | | conditions that warrant the institution of a civil action | 21 | | for an injunction under Section 43 of the Environmental | 22 | | Protection Act, then the Illinois Environmental Protection | 23 | | Agency shall request the State's Attorney or the Attorney | 24 | | General institute such action. The Illinois Environmental | 25 | | Protection Agency shall provide notice of any such actions | 26 | | as soon as possible on its website. The SNG facility shall |
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| 1 | | incur all reasonable costs associated with any such | 2 | | inspection or monitoring of the sequestration sites, and | 3 | | these costs shall not be recoverable from utilities or | 4 | | their customers. | 5 | | (4) (Blank). At least annually, the Commission shall | 6 | | inspect all carbon dioxide pipelines in Illinois that | 7 | | transport carbon dioxide to ensure the safety and | 8 | | feasibility of those pipelines. The Commission may, as | 9 | | often as deemed necessary, monitor and conduct | 10 | | investigations of those pipelines. The owner or operator of | 11 | | the pipeline must cooperate with the Commission | 12 | | investigations of the carbon dioxide pipelines. | 13 | | In circumstances whereby a carbon dioxide pipeline | 14 | | creates a substantial danger to the environment or to the | 15 | | public health of persons or to the welfare of persons where | 16 | | such danger is to the livelihood of such persons, the | 17 | | State's Attorney or Attorney General, upon the request of | 18 | | the Commission or on his or her own motion, may institute a | 19 | | civil action for an immediate injunction to halt any | 20 | | discharge or other activity causing or contributing to the | 21 | | danger or to require such other action as may be necessary. | 22 | | The court may issue an ex parte order and shall schedule a | 23 | | hearing on the matter not later than 3 working days after | 24 | | the date of injunction. The Commission shall provide notice | 25 | | of any such actions as soon as possible on its website. The | 26 | | SNG facility shall incur all reasonable costs associated |
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| 1 | | with any such inspection or monitoring of the sequestration | 2 | | sites, and these costs shall not be recoverable from a | 3 | | utility or its customers. | 4 | | (h-9) The clean coal SNG brownfield facility shall have the | 5 | | right to recover prudently incurred increased costs or reduced | 6 | | revenue resulting from any new or amendatory legislation or | 7 | | other action. The State of Illinois pledges that the State will | 8 | | not enact any law or take any action to: | 9 | | (1) break, or repeal the authority for, sourcing | 10 | | agreements approved by the Commission and entered into | 11 | | between public utilities and the clean coal SNG brownfield | 12 | | facility; | 13 | | (2) deny public utilities full cost recovery for their | 14 | | costs incurred under those sourcing agreements; or | 15 | | (3) deny the clean coal SNG brownfield facility full | 16 | | cost and revenue recovery as provided under those sourcing | 17 | | agreements that are recoverable pursuant to subsection | 18 | | (h-3) of this Section. | 19 | | These pledges are for the benefit of the parties to those | 20 | | sourcing agreements and the issuers and holders of bonds or | 21 | | other obligations issued or incurred to finance or refinance | 22 | | the clean coal SNG brownfield facility. The clean coal SNG | 23 | | brownfield facility is authorized to include and refer to these | 24 | | pledges in any financing agreement into which it may enter in | 25 | | regard to those sourcing agreements. | 26 | | The State of Illinois retains and reserves all other rights |
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| 1 | | to enact new or amendatory legislation or take any other | 2 | | action, without impairment of the right of the clean coal SNG | 3 | | brownfield facility to recover prudently incurred increased | 4 | | costs or reduced revenue resulting from the new or amendatory | 5 | | legislation or other action, including, but not limited to, | 6 | | such legislation or other action that would (i) directly or | 7 | | indirectly raise the costs the clean coal SNG brownfield | 8 | | facility must incur; (ii) directly or indirectly place | 9 | | additional restrictions, regulations, or requirements on the | 10 | | clean coal SNG brownfield facility; (iii) prohibit | 11 | | sequestration in general or prohibit a specific sequestration | 12 | | method or project; or (iv) increase minimum sequestration | 13 | | requirements for the clean coal SNG brownfield facility to the | 14 | | extent technically feasible. The clean coal SNG brownfield | 15 | | facility shall have the right to recover prudently incurred | 16 | | increased costs or reduced revenue resulting from the new or | 17 | | amendatory legislation or other action as described in this | 18 | | subsection (h-9). | 19 | | (h-10) Contract costs for SNG incurred by an Illinois gas | 20 | | utility are reasonable and prudent and recoverable through the | 21 | | purchased gas adjustment clause and are not subject to review | 22 | | or disallowance by the Commission. Contract costs are costs | 23 | | incurred by the utility under the terms of a contract that | 24 | | incorporates the terms stated in subsection (h) of this Section | 25 | | as confirmed in writing by the Illinois Power Agency as set | 26 | | forth in subsection (h) of this Section, which confirmation |
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| 1 | | shall be deemed conclusive, or as a consequence of or condition | 2 | | to its performance under the contract, including (i) amounts | 3 | | paid for SNG under the SNG contract and (ii) costs of | 4 | | transportation and storage services of SNG purchased from | 5 | | interstate pipelines under federally approved tariffs. The | 6 | | Illinois gas utility shall initiate a clean coal SNG facility | 7 | | rider mechanism that (A) shall be applicable to all customers | 8 | | who receive transportation service from the utility, (B) shall | 9 | | be designed to have an equal percentage impact on the | 10 | | transportation services rates of each class of the utility's | 11 | | total customers, and (C) shall accurately reflect the net | 12 | | customer savings, if any, and above market costs, if any, under | 13 | | the SNG contract. Any contract, the terms of which have been | 14 | | confirmed in writing by the Illinois Power Agency as set forth | 15 | | in subsection (h) of this Section and the performance of the | 16 | | parties under such contract cannot be grounds for challenging | 17 | | prudence or cost recovery by the utility through the purchased | 18 | | gas adjustment clause, and in such cases, the Commission is | 19 | | directed not to consider, and has no authority to consider, any | 20 | | attempted challenges. | 21 | | The contracts entered into by Illinois gas utilities | 22 | | pursuant to subsection (h) of this Section shall provide that | 23 | | the utility retains the right to terminate the contract without | 24 | | further obligation or liability to any party if the contract | 25 | | has been impaired as a result of any legislative, | 26 | | administrative, judicial, or other governmental action that is |
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| 1 | | taken that eliminates all or part of the prudence protection of | 2 | | this subsection (h-10) or denies the recoverability of all or | 3 | | part of the contract costs through the purchased gas adjustment | 4 | | clause. Should any Illinois gas utility exercise its right | 5 | | under this subsection (h-10) to terminate the contract, all | 6 | | contract costs incurred prior to termination are and will be | 7 | | deemed reasonable, prudent, and recoverable as and when | 8 | | incurred and not subject to review or disallowance by the | 9 | | Commission. Any order, issued by the State requiring or | 10 | | authorizing the discontinuation of the merchant function, | 11 | | defined as the purchase and sale of natural gas by an Illinois | 12 | | gas utility for the ultimate consumer in its service territory | 13 | | shall include provisions necessary to prevent the impairment of | 14 | | the value of any contract hereunder over its full term. | 15 | | (h-11) All costs incurred by an Illinois gas utility in | 16 | | procuring SNG from a clean coal SNG brownfield facility | 17 | | pursuant to subsection (h-1) or a third-party marketer pursuant | 18 | | to subsection (h-1) are reasonable and prudent and recoverable | 19 | | through the purchased gas adjustment clause in conjunction with
| 20 | | a SNG brownfield facility rider mechanism and are not subject | 21 | | to review or disallowance by the Commission; provided that
if a | 22 | | utility is required by law or otherwise elects to connect
the | 23 | | clean coal SNG brownfield facility to an interstate
pipeline, | 24 | | then the utility shall be entitled to recover
pursuant to its | 25 | | tariffs all just and reasonable costs that are
prudently | 26 | | incurred. Sourcing agreement costs are costs incurred by the |
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| 1 | | utility under the terms of a sourcing agreement that | 2 | | incorporates the terms stated in subsection (h-1) of this | 3 | | Section as approved by the Commission as set forth in | 4 | | subsection (h-4) of this Section, which approval shall be | 5 | | deemed conclusive, or as a consequence of or condition to its | 6 | | performance under the contract, including (i) amounts paid for | 7 | | SNG under the SNG contract and (ii) costs of transportation and | 8 | | storage services of SNG purchased from interstate pipelines | 9 | | under federally approved tariffs. Any sourcing agreement, the | 10 | | terms of which have been approved by the Commission as set | 11 | | forth in subsection (h-4) of this Section, and the performance | 12 | | of the parties under the sourcing agreement cannot be grounds | 13 | | for challenging prudence or cost recovery by the utility, and | 14 | | in these cases, the Commission is directed not to consider, and | 15 | | has no authority to consider, any attempted challenges. | 16 | | (h-15) Reconciliation account. The clean coal SNG facility | 17 | | shall establish a reconciliation account for the benefit of the | 18 | | retail customers of the utilities that have entered into | 19 | | contracts with the clean coal SNG facility pursuant to | 20 | | subsection (h). The reconciliation account shall be maintained | 21 | | and administered by an independent trustee that is mutually | 22 | | agreed upon by the owners of the clean coal SNG facility, the | 23 | | utilities, and the Commission in an interest-bearing account in | 24 | | accordance with the following: | 25 | | (1) The clean coal SNG facility shall conduct an | 26 | | analysis annually within 60 days after receiving the |
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| 1 | | necessary cost information, which shall be provided by the | 2 | | gas utility within 6 months after the end of the preceding | 3 | | calendar year, to determine (i) the average annual contract | 4 | | SNG cost, which shall be calculated as the total amount | 5 | | paid for SNG purchased from the clean coal SNG facility | 6 | | over the preceding 12 months, plus the cost to the utility | 7 | | of the required transportation and storage services of SNG, | 8 | | divided by the total number of MMBtus of SNG actually | 9 | | purchased from the clean coal SNG facility in the preceding | 10 | | 12 months under the utility contract; (ii) the average | 11 | | annual natural gas purchase cost, which shall be calculated | 12 | | as the total annual supply costs paid for baseload natural | 13 | | gas (excluding any SNG) purchased by such utility over the | 14 | | preceding 12 months plus the costs of transportation and | 15 | | storage services of such natural gas (excluding such costs | 16 | | for SNG), divided by the total number of MMbtus of baseload | 17 | | natural gas (excluding SNG) actually purchased by the | 18 | | utility during the year; (iii) the cost differential, which | 19 | | shall be the difference between the average annual contract | 20 | | SNG cost and the average annual natural gas purchase cost; | 21 | | and (iv) the revenue share target which shall be the cost | 22 | | differential multiplied by the total amount of SNG | 23 | | purchased over the preceding 12 months under such utility | 24 | | contract. | 25 | | (A) To the extent the annual average contract SNG | 26 | | cost is less than the annual average natural gas |
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| 1 | | purchase cost, the utility shall credit an amount equal | 2 | | to the revenue share target to the reconciliation | 3 | | account. Such credit payment shall be made monthly | 4 | | starting within 30 days after the completed analysis in | 5 | | this subsection (h-15) and based on collections from | 6 | | all customers via a line item charge in all customer | 7 | | bills designed to have an equal percentage impact on | 8 | | the transportation services of each class of | 9 | | customers. Credit payments made pursuant to this | 10 | | subparagraph (A) shall be deemed prudent and | 11 | | reasonable and not subject to Commission prudence | 12 | | review. | 13 | | (B) To the extent the annual average contract SNG | 14 | | cost is greater than the annual average natural gas | 15 | | purchase cost, the reconciliation account shall be | 16 | | used to provide a credit equal to the revenue share | 17 | | target to the utilities to be used to reduce the | 18 | | utility's natural gas costs through the purchased gas | 19 | | adjustment clause. Such payment shall be made within 30 | 20 | | days after the completed analysis pursuant to this | 21 | | subsection (h-15), but only to the extent that the | 22 | | reconciliation account has a positive balance. | 23 | | (2) At the conclusion of the term of the SNG contracts | 24 | | pursuant to subsection (h) and the completion of the final | 25 | | annual analysis pursuant to this subsection (h-15), to the | 26 | | extent the facility owes any amount to retail customers, |
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| 1 | | amounts in the account shall be credited to retail | 2 | | customers to the extent the owed amount is repaid; 50% of | 3 | | any additional amount in the reconciliation account shall | 4 | | be distributed to the utilities to be used to reduce the | 5 | | utilities' natural gas costs through the purchase gas | 6 | | adjustment clause with the remaining amount distributed to | 7 | | the clean coal SNG facility. Such payment shall be made | 8 | | within 30 days after the last completed analysis pursuant | 9 | | to this subsection (h-15). If the facility has repaid all | 10 | | owed amounts, if any, to retail customers and has | 11 | | distributed 50% of any additional amount in the account to | 12 | | the utilities, then the owners of the clean coal SNG | 13 | | facility shall have no further obligation to the utility or | 14 | | the retail customers. | 15 | | If, at the conclusion of the term of the contracts | 16 | | pursuant to subsection (h) and the completion of the final | 17 | | annual analysis pursuant to this subsection (h-15), the | 18 | | facility owes any amount to retail customers and the | 19 | | account has been depleted, then the clean coal SNG facility | 20 | | shall be liable for any remaining amount owed to the retail | 21 | | customers. The clean coal SNG facility shall market the | 22 | | daily production of SNG and distribute on a monthly basis | 23 | | 5% of the amounts collected with respect to such future | 24 | | sales to the utilities in proportion to each utility's SNG | 25 | | contract to be used to reduce the utility's natural gas | 26 | | costs through the purchase gas adjustment clause; such |
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| 1 | | payments to the utility shall continue until either 15 | 2 | | years after the conclusion of the contract or such time as | 3 | | the sum of such payments equals the remaining amount owed | 4 | | to the retail customers at the end of the contract, | 5 | | whichever is earlier. If the debt to the retail customers | 6 | | is not repaid within 15 years after the conclusion of the | 7 | | contract, then the owner of the clean coal SNG facility | 8 | | must sell the facility, and all proceeds from that sale | 9 | | must be used to repay any amount owed to the retail | 10 | | customers under this subsection (h-15). | 11 | | The retail customers shall have first priority in | 12 | | recovering that debt above any creditors, except the | 13 | | secured lenders to the extent that the secured lenders have | 14 | | any secured debt outstanding, including any parent | 15 | | companies or affiliates of the clean coal SNG facility. | 16 | | (3) 50% of all additional net revenue, defined as | 17 | | miscellaneous net revenue after cost allowance and above | 18 | | the budgeted estimate established for revenue pursuant to | 19 | | subsection (h), including sale of substitute natural gas | 20 | | derived from the clean coal SNG facility above the | 21 | | nameplate capacity of the facility and other by-products | 22 | | produced by the facility, shall be credited to the | 23 | | reconciliation account on an annual basis with such payment | 24 | | made within 30 days after the end of each calendar year | 25 | | during the term of the contract. | 26 | | (4) The clean coal SNG facility shall each year, |
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| 1 | | starting in the facility's first year of commercial | 2 | | operation, file with the Commission, in such form as the | 3 | | Commission shall require, a report as to the reconciliation | 4 | | account. The annual report must contain the following | 5 | | information: | 6 | | (A) the revenue share target amount; | 7 | | (B) the amount credited or debited to the | 8 | | reconciliation account during the year; | 9 | | (C) the amount credited to the utilities to be used | 10 | | to reduce the utilities natural gas costs though the | 11 | | purchase gas adjustment clause; | 12 | | (D) the total amount of reconciliation account at | 13 | | the beginning and end of the year; | 14 | | (E) the total amount of consumer savings to date; | 15 | | and | 16 | | (F) any additional information the Commission may | 17 | | require. | 18 | | When any report is erroneous or defective or appears to the | 19 | | Commission to be erroneous or defective, the Commission may | 20 | | notify the clean coal SNG facility to amend the report within | 21 | | 30 days; before or after the termination of the 30-day period, | 22 | | the Commission may examine the trustee of the reconciliation | 23 | | account or the officers, agents, employees, books, records, or | 24 | | accounts of the clean coal SNG facility and correct such items | 25 | | in the report as upon such examination the Commission may find | 26 | | defective or erroneous. All reports shall be under oath. |
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| 1 | | All reports made to the Commission by the clean coal SNG | 2 | | facility and the contents of the reports shall be open to | 3 | | public inspection and shall be deemed a public record under the | 4 | | Freedom of Information Act. Such reports shall be preserved in | 5 | | the office of the Commission. The Commission shall publish an | 6 | | annual summary of the reports prior to February 1 of the | 7 | | following year. The annual summary shall be made available to | 8 | | the public on the Commission's website and shall be submitted | 9 | | to the General Assembly. | 10 | | Any facility that fails to file the report required under | 11 | | this paragraph (4) to the Commission within the time specified | 12 | | or to make specific answer to any question propounded by the | 13 | | Commission within 30 days after the time it is lawfully | 14 | | required to do so, or within such further time not to exceed 90 | 15 | | days as may be allowed by the Commission in its discretion, | 16 | | shall pay a penalty of $500 to the Commission for each day it | 17 | | is in default. | 18 | | Any person who willfully makes any false report to the | 19 | | Commission or to any member, officer, or employee thereof, any | 20 | | person who willfully in a report withholds or fails to provide | 21 | | material information to which the Commission is entitled under | 22 | | this paragraph (4) and which information is either required to | 23 | | be filed by statute, rule, regulation, order, or decision of | 24 | | the Commission or has been requested by the Commission, and any | 25 | | person who willfully aids or abets such person shall be guilty | 26 | | of a Class A misdemeanor. |
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| 1 | | (h-20) The General Assembly authorizes the Illinois | 2 | | Finance Authority to issue bonds to the maximum extent | 3 | | permitted to finance coal gasification facilities described in | 4 | | this Section, which constitute both "industrial projects" | 5 | | under Article 801 of the Illinois Finance Authority Act and | 6 | | "clean coal and energy projects" under Sections 825-65 through | 7 | | 825-75 of the Illinois Finance Authority Act. | 8 | | Administrative costs incurred by the Illinois Finance | 9 | | Authority in performance of this subsection (h-20) shall be | 10 | | subject to reimbursement by the clean coal SNG facility on | 11 | | terms as the Illinois Finance Authority and the clean coal SNG | 12 | | facility may agree. The utility and its customers shall have no | 13 | | obligation to reimburse the clean coal SNG facility or the | 14 | | Illinois Finance Authority for any such costs. | 15 | | (h-25) The State of Illinois pledges that the State may not | 16 | | enact any law or take any action to (1) break or repeal the | 17 | | authority for SNG purchase contracts entered into between | 18 | | public gas utilities and the clean coal SNG facility pursuant | 19 | | to subsection (h) of this Section or (2) deny public gas | 20 | | utilities their full cost recovery for contract costs, as | 21 | | defined in subsection (h-10), that are incurred under such SNG | 22 | | purchase contracts. These pledges are for the benefit of the | 23 | | parties to such SNG purchase contracts and the issuers and | 24 | | holders of bonds or other obligations issued or incurred to | 25 | | finance or refinance the clean coal SNG facility. The | 26 | | beneficiaries are authorized to include and refer to these |
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| 1 | | pledges in any finance agreement into which they may enter in | 2 | | regard to such contracts. | 3 | | (h-30) The State of Illinois retains and reserves all other | 4 | | rights to enact new or amendatory legislation or take any other | 5 | | action, including, but not limited to, such legislation or | 6 | | other action that would (1) directly or indirectly raise the | 7 | | costs that the clean coal SNG facility must incur; (2) directly | 8 | | or indirectly place additional restrictions, regulations, or | 9 | | requirements on the clean coal SNG facility; (3) prohibit | 10 | | sequestration in general or prohibit a specific sequestration | 11 | | method or project; or (4) increase minimum sequestration | 12 | | requirements. | 13 | | (i) If a gas utility or an affiliate of a gas utility has | 14 | | an ownership interest in any entity that produces or sells | 15 | | synthetic natural gas, Article VII of this Act shall apply.
| 16 | | (Source: P.A. 96-1364, eff. 7-28-10; 97-96, eff. 7-13-11; | 17 | | 97-239, eff. 8-2-11; 97-630, eff. 12-8-11.) | 18 | | Section 10. The Illinois Gas Pipeline Safety Act is amended | 19 | | by changing Sections 2.02, 2.03, 2.04, and 3 as follows:
| 20 | | (220 ILCS 20/2.02) (from Ch. 111 2/3, par. 552.2)
| 21 | | Sec. 2.02.
"Gas" means natural gas, flammable gas or gas | 22 | | which is toxic or
corrosive. "Gas" also means carbon dioxide in | 23 | | any physical form, whenever transported by pipeline for the | 24 | | purpose of sequestration.
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| 1 | | (Source: P.A. 97-96, eff. 7-13-11; 97-239, eff. 8-2-11.)
| 2 | | (220 ILCS 20/2.03) (from Ch. 111 2/3, par. 552.3)
| 3 | | Sec. 2.03.
"Transportation of gas" means the gathering, | 4 | | transmission, or
distribution of gas by pipeline or its | 5 | | storage, within this State and not
subject to the jurisdiction | 6 | | of the Federal Energy Regulatory
Commission under the
Natural | 7 | | Gas Act, except that it includes the transmission of gas | 8 | | through
pipeline facilities within this State that transport | 9 | | gas from an interstate
gas pipeline to a direct sales customer | 10 | | within this State purchasing gas
for its own consumption. | 11 | | "Transportation of gas" also includes
the conveyance of gas | 12 | | from a gas main through the primary fuel line to the
outside | 13 | | wall of residential
premises. If the gas meter is placed within | 14 | | 3 feet of the structure, the
utility's responsibility shall end | 15 | | at the outlet side of the meter. "Transportation of gas" also | 16 | | includes the conveyance of carbon dioxide in any physical form | 17 | | for the purpose of sequestration.
| 18 | | (Source: P.A. 97-96, eff. 7-13-11; 97-239, eff. 8-2-11.)
| 19 | | (220 ILCS 20/2.04) (from Ch. 111 2/3, par. 552.4)
| 20 | | Sec. 2.04.
"Pipeline facilities" includes new and existing | 21 | | pipe rights-of-way and
any equipment, facility, or building | 22 | | used in the transportation of gas
or the
treatment of gas | 23 | | during the course of transportation and
includes facilities | 24 | | within this State that transport gas from an interstate
gas |
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| 1 | | pipeline to a direct sales customer within this State | 2 | | purchasing gas
for its own consumption, but
"rights-of-way" as | 3 | | used in this Act does not authorize the Commission to
| 4 | | prescribe, under this Act, the location or
routing of any | 5 | | pipeline facility. "Pipeline facilities" also includes
new and | 6 | | existing pipes and lines and any other equipment, facility, or
| 7 | | structure, except customer-owned branch lines connected to the | 8 | | primary fuel
lines, used to convey gas from a gas main to the | 9 | | outside wall of
residential premises, and any person who | 10 | | provides gas service directly to its
residential customer | 11 | | through these facilities shall be deemed to operate
such | 12 | | pipeline facilities for purposes of this Act irrespective of | 13 | | the ownership
of the facilities or the location of the | 14 | | facilities with respect to the
meter, except that a person who | 15 | | provides gas service to a "master meter
system", as that term | 16 | | is defined at 49 C.F.R. Section 191.3, shall not be
deemed to | 17 | | operate any facilities downstream of the master meter. | 18 | | "Pipeline facilities" also includes new and existing pipe | 19 | | rights-of-way and any equipment, facility, or building used in | 20 | | the transportation of carbon dioxide in any physical form for | 21 | | the purpose of sequestration.
| 22 | | (Source: P.A. 97-96, eff. 7-13-11; 97-239, eff. 8-2-11.)
| 23 | | (220 ILCS 20/3) (from Ch. 111 2/3, par. 553)
| 24 | | Sec. 3.
(a) As soon as practicable, but not later than 3 | 25 | | months after the
effective date of this Act, the Commission |
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| 1 | | shall adopt rules establishing
minimum safety standards for the | 2 | | transportation of gas and for pipeline
facilities. Such rules | 3 | | shall be at least as inclusive, as stringent, and
compatible | 4 | | with, the minimum safety standards adopted by the Secretary of
| 5 | | Transportation under the Federal Act. Thereafter, the | 6 | | Commission shall
maintain such rules so that the rules are at | 7 | | least as inclusive, as
stringent, and compatible with, the | 8 | | minimum standards from time to time in
effect under the Federal | 9 | | Act. The Commission shall also adopt rules establishing minimum | 10 | | safety standards for the transportation of carbon dioxide in | 11 | | any physical form for the purpose of sequestration and for | 12 | | pipeline facilities used for that function.
| 13 | | (b) Standards established under this Act may apply to the | 14 | | design,
installation, inspection, testing, construction, | 15 | | extension, operation,
replacement, and maintenance of pipeline | 16 | | facilities. Standards affecting
the design, installation, | 17 | | construction, initial inspection and initial
testing are not | 18 | | applicable to pipeline facilities in existence on the date
such | 19 | | standards are adopted. Whenever the Commission finds a | 20 | | particular
facility to be hazardous to life or property, it may | 21 | | require the person
operating such facility to take the steps | 22 | | necessary to remove the hazard.
| 23 | | (c) Standards established by the Commission under this Act | 24 | | shall,
subject to paragraphs (a) and (b) of this Section 3, be | 25 | | practicable and
designed to meet the need for pipeline safety. | 26 | | In prescribing such
standards, the Commission shall consider: |
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| 1 | | similar standards established in
other states; relevant | 2 | | available pipeline safety data; whether such
standards are | 3 | | appropriate for the particular type of pipeline
| 4 | | transportation; the reasonableness of any proposed standards; | 5 | | and the
extent to which such standards will contribute to | 6 | | public safety.
| 7 | | Rules adopted under this Act are subject to "The Illinois | 8 | | Administrative
Procedure Act", approved September 22, 1975, as | 9 | | amended.
| 10 | | (Source: P.A. 97-96, eff. 7-13-11; 97-239, eff. 8-2-11.)
| 11 | | Section 15. The Carbon Dioxide Transportation and | 12 | | Sequestration Act is amended by changing Section 30 as follows: | 13 | | (220 ILCS 75/30)
| 14 | | Sec. 30. Safety. Inasmuch as the regulation of the | 15 | | construction, maintenance, and operation of pipelines | 16 | | transporting carbon dioxide, whether interstate or intrastate, | 17 | | falls within the statutory and regulatory jurisdiction of the | 18 | | Pipeline and Hazardous Material Safety Administration of the | 19 | | federal Department of Transportation, each A carbon dioxide | 20 | | pipeline owner shall construct, maintain, and operate all of | 21 | | its pipelines, related facilities, and equipment in this State | 22 | | in a manner that complies fully with all federal laws and | 23 | | regulations governing the construction, maintenance, and | 24 | | operation of pipelines transporting carbon dioxide, as from |
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| 1 | | time to time amended, and which otherwise poses no undue risk | 2 | | to its employees or the public. This Section shall not be | 3 | | interpreted to act in derogation of any such federal laws or | 4 | | regulations. The Commission shall not issue any certificates or | 5 | | permits allowing the construction of a carbon dioxide pipeline | 6 | | until it has adopted federal safety regulations governing the | 7 | | construction, maintenance, and operations of carbon dioxide | 8 | | pipelines, related facilities, and equipment to ensure the | 9 | | safety of pipeline employees and the public.
| 10 | | (Source: P.A. 97-534, eff. 8-23-11.)
| 11 | | Section 99. Effective date. This Act takes effect upon | 12 | | becoming law.
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