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| [ House Amendment 001 ] |
90_HB1309
220 ILCS 5/8-403.1 from Ch. 111 2/3, par. 8-403.1
Amends the Public Utilities Act. Provides that qualified
solid waste energy facilities that use solid waste to
generate energy must include equipment designed to separate
at least 20% by weight of recyclable materials from the solid
waste and must comply with air emission limits set by the
Environmental Protection Agency. Sets forth the purchase rate
for electricity under long-term contracts between electric
utilities and qualified solid waste energy facilities, other
than facilities using landfill-generated methane for fuel,
and sets forth exceptions to the rate. Provides that the
long-term contracts shall apply to electricity generated by a
facility on or after January 1, 1997. Limits the application
of the purchase rate provisions to qualified facilities that
met certain standards before January 1, 1997. Establishes
requirements for the manner in which a qualified facility
shall reimburse the Public Utility Fund. Provides for a
statutory lien on a qualified facility in favor of the Fund
on the reimbursement commencement date. Effective
immediately.
LRB9003851DPccD
LRB9003851DPccD
1 AN ACT to amend the Public Utilities Act by changing
2 Section 8-403.1.
3 Be it enacted by the People of the State of Illinois,
4 represented in the General Assembly:
5 Section 5. The Public Utilities Act is amended by
6 changing Section 8-403.1 as follows:
7 (220 ILCS 5/8-403.1) (from Ch. 111 2/3, par. 8-403.1)
8 Sec. 8-403.1. Qualified solid waste energy facilities;
9 purchase rate.
10 (a) It is hereby declared to be the policy of this State
11 to encourage the development of alternate energy production
12 facilities in order to conserve our energy resources and to
13 provide for their most efficient use.
14 (b) For the purpose of this Section and Section 9-215.1,
15 "qualified solid waste energy facility" means a facility
16 determined by the Illinois Commerce Commission to qualify as
17 such under the Local Solid Waste Disposal Act, to use methane
18 gas generated from landfills as its primary fuel, and to
19 possess characteristics that would enable it to qualify as a
20 cogeneration or small power production facility under federal
21 law.
22 (b-5) In the case of facilities that use solid waste as
23 a fuel to generate energy, the facility must (i) include
24 equipment designed to recover recyclable materials in an
25 amount equal to at least 20% by weight from all solid waste
26 delivered to the facility and (ii) comply with air quality
27 standards set forth by the Illinois Environmental Protection
28 Agency.
29 (c) In furtherance of the policy declared in this
30 Section, the Illinois Commerce Commission shall require,
31 subject to the provisions of subsection (i) of this Section,
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1 electric utilities to enter into long-term contracts to
2 purchase electricity from qualified solid waste energy
3 facilities located in the electric utility's service area,
4 for a period beginning on the date that the facility begins
5 generating electricity and having a duration of not less than
6 20 years, or 10 years in the case of facilities fueled by
7 landfill-generated methane, or 20 years in the case of
8 facilities fueled by methane generated from a landfill owned
9 by a forest preserve district. For facilities that use solid
10 waste as a fuel to generate energy, the purchase rate
11 contained in the long-term contracts shall be a rate equal to
12 the average amount per kilowatt-hour paid from time to time
13 by the unit or units of local government owning or served by
14 the facilities, excluding amounts paid for street lighting
15 and pumping services. For facilities that use
16 landfill-generated methane gas as fuel, the purchase rate
17 contained in such contracts shall be equal to the average
18 amount per kilowatt-hour paid from time to time by the unit
19 or units of local government in which the electricity
20 generating facilities are located, excluding amounts paid for
21 street lighting and pumping service. Long-term contracts with
22 facilities meeting the criteria under subsection (i) shall
23 cover electricity generated on and after January 1, 1997.
24 (d) Whenever a public utility is required to purchase
25 electricity pursuant to subsection (c) above, it shall be
26 entitled to credits in respect of its obligations to pay
27 taxes to the State, including but not limited to tax
28 obligations under the Public Utilities Revenue Act or any
29 successor taxes to that Act equal to the amounts, if any, by
30 which payments for such electricity exceed (i) the then
31 current rate at which the utility must purchase the output of
32 qualified facilities pursuant to the federal Public Utility
33 Regulatory Policies Act of 1978, less (ii) any costs,
34 expenses, losses, damages or other amounts incurred by the
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1 utility, or for which it becomes liable, arising out of its
2 failure to obtain such electricity from such other sources.
3 The amount of any such credit shall, in the first instance,
4 be determined by the utility, which shall make a monthly
5 report of such credits to the Illinois Commerce Commission
6 and, on its monthly tax return, to the Illinois Department of
7 Revenue. Under no circumstances shall a utility be required
8 to purchase electricity from a qualified solid waste energy
9 facility at the rate prescribed in subsection (c) of this
10 Section if (A) such purchase would result in estimated tax
11 credits that exceed, on a monthly basis, the utility's
12 estimated obligation to pay taxes to the State, including but
13 not limited to taxes payable under the Public Utilities
14 Revenue Act or any successor taxes to that Act or (B) the
15 facility fails to comply with the air quality standards
16 prescribed for the facility by the Illinois Environmental
17 Protection Agency, in which case (i) the Illinois
18 Environmental Protection Agency shall notify the public
19 utility of the noncompliance and (ii) the facility shall
20 receive a reduced rate per kilowatt-hour equal to the current
21 rate at which the utility must purchase the output of
22 qualified facilities pursuant to the Public Utility
23 Regulatory Policies Act of 1978 for the period of
24 noncompliance, that period not to be less than one hour. The
25 owner or operator shall negotiate facility operating
26 conditions with the purchasing utility in accordance with
27 that utility's posted standard terms and conditions for small
28 power producers. If the Department of Revenue disputes the
29 amount of any such credit, such dispute shall be decided by
30 the Illinois Commerce Commission. Whenever A qualified solid
31 waste energy facility has paid or otherwise satisfied in full
32 the capital costs or indebtedness incurred in developing and
33 implementing the qualified facility, the qualified facility
34 shall reimburse the Public Utility Utilities Fund or any
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1 successor fund in the State treasury for the actual reduction
2 in payments to that Fund caused by this subsection (d) in a
3 manner to be determined by the Illinois Commerce Commission
4 and based on the manner in which revenues for that Fund were
5 reduced. In establishing the manner in which a qualified
6 solid waste energy facility shall reimburse the Fund, the
7 Illinois Commerce Commission shall require that (i) payments
8 to the Fund begin on the reimbursement commencement date,
9 which shall be the earlier of (A) 21 years from the date the
10 qualified solid waste energy facility begins commercial
11 operation or (B) the date on which the capital costs or
12 indebtedness incurred in developing, constructing,
13 refinancing, and implementing the qualified facility have
14 been paid in full, and (ii) full reimbursement to the Fund
15 shall occur over a 12-year period after the reimbursement
16 commencement date. Payments shall be made in equal monthly
17 installments. A reimbursement payment that is not paid when
18 due in accordance with this subsection (d) shall bear
19 interest at the rate specified in Section 12-1303 of the Code
20 of Civil Procedure from the date the payment was due until
21 the date the payment and all interest related to the payment
22 is paid in full. In order to secure payment of the
23 reimbursement obligation of a qualified facility under this
24 subsection there is established a statutory lien in favor of
25 the Fund on the qualified facility. The lien shall come into
26 existence on the reimbursement commencement date and after
27 that date, shall be superior to all other liens established
28 in connection with the indebtedness incurred in developing,
29 constructing, and implementing the qualified facility. The
30 statutory lien shall expire on the date that the facility
31 makes the last payment specified in the schedule of
32 reimbursement payments.
33 For purposes of this Section "air quality standards"
34 means the air emission limits for each continuously monitored
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1 emission constituent, while using solid waste as fuel, as set
2 forth in the Construction/PSD permit issued by the Illinois
3 Environmental Protection Agency prior to commencement of
4 construction of a qualified solid waste energy facility.
5 (e) The Illinois Commerce Commission shall not require
6 an electric utility to purchase electricity from any
7 qualified solid waste energy facility which is owned or
8 operated by an entity that is primarily engaged in the
9 business of producing or selling electricity, gas, or useful
10 thermal energy from a source other than one or more qualified
11 solid waste energy facilities.
12 (f) This Section does not require an electric utility to
13 construct additional facilities unless those facilities are
14 paid for by the owner or operator of the affected qualified
15 solid waste energy facility.
16 (g) The Illinois Commerce Commission shall require that:
17 (1) electric utilities use the electricity purchased from a
18 qualified solid waste energy facility to displace electricity
19 generated from nuclear power or coal mined and purchased
20 outside the boundaries of the State of Illinois before
21 displacing electricity generated from coal mined and
22 purchased within the State of Illinois, to the extent
23 possible, and (2) electric utilities report annually to the
24 Commission on the extent of such displacements.
25 (h) Nothing in this Section is intended to cause an
26 electric utility that is required to purchase power hereunder
27 to incur any economic loss as a result of its purchase. All
28 amounts paid for power which a utility is required to
29 purchase pursuant to subparagraph (c) shall be deemed to be
30 costs prudently incurred for purposes of computing charges
31 under rates authorized by Section 9-220 of this Act. Tax
32 credits provided for herein shall be reflected in charges
33 made pursuant to rates so authorized to the extent such
34 credits are based upon a cost which is also reflected in such
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1 charges.
2 (i) The provisions of subsection (c) of this Section
3 shall not apply to a facility unless the facility either (1)
4 is fueled by landfill-generated methane or (2) met the
5 following criteria prior to January 1, 1997:
6 (A) the Illinois Commerce Commission issued an
7 order making the determination required by subsection (b)
8 of this Section for the facility;
9 (B) all governmental permits necessary to commence
10 construction were issued;
11 (C) construction of the facility was substantially
12 completed; and
13 (D) bonds were issued or other debt was incurred
14 for the purpose, and in the full amount anticipated at
15 the time of issuance or incurrence to be necessary, to
16 finance the development and construction of the facility.
17 (Source: P.A. 89-448, eff. 3-14-96.)
18 Section 99. Effective date. This Act takes effect upon
19 becoming law.