Current law also allows, but does not require, an energy utility to administer,
subject to PSC approval, energy efficiency programs limited to large commercial,
industrial, institutional, or agricultural customers in its service territory. The bill
refers to these programs as "utility-administered programs." In addition, the PSC
may also allow an energy utility to administer additional energy efficiency or
renewable resource programs, which are referred to as "supplemental utility
programs." Also, the PSC may allow certain large energy customers of energy
utilities to administer their own energy efficiency programs, which are referred to
as "large energy customer programs." Under current law, with certain exceptions,
the PSC must require energy utilities to spend 1.2 percent of their operating
revenues on statewide programs and utility-administered programs, and the PSC
must ensure in rate-making orders that an energy utility recovers from its
customers the amounts it spends on statewide programs, subject to certain
requirements regarding customer classes and large energy customers.
Municipal electric utilities and retail electric cooperatives are subject to
different requirements. Under current law, subject to certain exceptions, municipal
electric utilities and retail electric cooperatives must charge a monthly fee to each
customer or member that is sufficient to collect an annual average of $8 per meter.
Municipal electric utilities and retail electric cooperatives must either contribute the
amounts collected to the statewide programs or administer their own energy
efficiency programs, which are referred to as "commitment to community programs."
The bill makes the following changes to the requirements described above.
Liquified petroleum gas and heating oil. Under current law, only the users
of electricity and natural gas are eligible to participate in energy efficiency and
renewable resource programs. The bill allows users of liquified petroleum gas or
heating oil to participate in energy efficiency programs as well. The bill refers to
electricity and natural gas as "regulated fuels" and liquified petroleum gas and
heating oil as "unregulated fuels." Regulated and unregulated fuels are jointly
referred to as "target fuels."
Program goals and funding. Under current law, the PSC has oversight of
the statewide, utility-administered, supplemental utility, and large energy
customer programs, and must coordinate all programs with similar purposes. At
least every four years, the PSC is required to evaluate the programs and to set or
revise goals, priorities, and measurable targets for the programs. The bill creates
more detailed requirements for the PSC's review of programs, including
requirements for setting goals and funding programs.
The bill requires the PSC to conduct a proceeding every four years to assess the
reduction in the use of and demand for each target fuel that can be achieved in each
year of the upcoming quadrennium through each of the following: 1) energy
efficiency and renewable resource programs administered by energy utilities,
municipal electric utilities, retail electric cooperatives, or others; 2) low-income
weatherization programs; 3) other programs and policy mechanisms under the PSC's
jurisdiction; and 4) other programs and policy mechanisms, such as appliance and
equipment efficiency standards, mandatory building codes, and voluntary
certification programs. Based on the foregoing assessments, the bill specifies a
formula for the PSC to establish goals for the reduction in use of or demand for each
target fuel for each year of the upcoming quadrennium. The PSC must establish one
set of goals for the statewide programs and a separate set of goals for each municipal
electric utility and retail electric cooperative. For the statewide programs, the PSC
sets goals for each regulated fuel that is based, in part, on the proportion of total sales
of the fuel that is attributable to all energy utilities. For an individual municipal
electric utility or retail electric cooperative, the PSC sets goals for regulated fuels
that are based, in part, on the proportion of total sales of the fuel that are attributable
to the utility or cooperative. For unregulated fuels, the PSC sets goals for the
statewide programs, but not for individual municipal electric utilities and retail
electric cooperatives.
Regarding funding, the bill repeals the requirements under current law for
energy utilities to spend 1.2 percent of their operating revenues and municipal
electric utilities and retail electric cooperatives to charge monthly fees to customers
and members. Instead, for municipal electric utilities and retail electric
cooperatives, the bill allows them to determine the funding amounts necessary to
achieve their goals for regulated fuels in each year of the upcoming quadrennium.
Except for assignments to wholesale suppliers, which are discussed below, a
municipal electric utility or retail electric cooperative must spend the amounts it
determines on commitment to community programs regarding the regulated fuel
that are administered individually by the municipal electric utility or retail electric
cooperative or jointly with other municipal electric utilities and retail electric
cooperatives. Alternatively, a municipal electric utility or retail electric cooperative
may spend the amounts it determines on contracts with a statewide programs
contractor or wholesale supplier to administer commitment to community programs
in the utility's or cooperative's service territory, or may spend the amount on any
combination of individually or jointly administered programs or contracts.
For energy utilities, the bill creates requirements for them to fund the
statewide programs. The PSC must determine the amount of funding required to
achieve the goal for each target fuel under the statewide programs for each year of
the upcoming quadrennium, and subtract from that amount any amounts the PSC
has authorized to be spent on utility-administered or large energy customer
programs for the target fuel. The difference is the total funding required for the
target fuel under the statewide programs. For regulated fuels, the PSC then
determines each energy utility's percentage of the total sales of the regulated fuel in
the quadrennium prior to the proceeding. Annually, an energy utility must pay to
statewide programs contractors an amount equal to that percentage multiplied by
the total funding required for the regulated fuel. However, an energy utility is
allowed to reduce its payment by any amount the PSC has authorized the utility to
spend on utility-administered programs and any amount the PSC has authorized
the utility's customers to spend on large energy customer programs. For unregulated
fuels, funding of the goals is borne by "prime suppliers," which the bill defines as
persons who import an unregulated fuel into this state for use in this state. The PSC
must determine each prime supplier's percentage of the total sales of the
unregulated fuel in the quadrennium prior to the proceeding. Annually, a prime
supplier must pay to statewide programs contractors an amount equal to that
percentage multiplied by the total funding required for the unregulated fuel.
Assignments to wholesale suppliers. Current law defines "wholesale
supplier" as a municipal electric company or wholesale electric cooperative that
supplies electricity at wholesale to a municipal electric utility or retail electric
cooperative. The bill allows a municipal electric utility or retail electric cooperative
to assign its duties regarding a goal to its wholesale supplier. A wholesale supplier
who accepts an assignment must notify the PSC, determine the funding amount
necessary to achieve the assigned goal, and spend the amount so determined in
administering commitment to community programs on behalf of the municipal
electric utility or retail electric cooperative. The wholesale supplier must also take
other actions regarding the municipal electric utility's or retail electric cooperative's
reporting and auditing duties with respect to the goal. In addition, if a wholesale
supplier accepts an assignment from more than one municipal electric utility or
retail electric cooperative, the wholesale supplier must carry out the its duties on an
aggregate basis on behalf of all the municipal electric utilities and retail electric
cooperatives that made an assignment.
Compliance and enforcement. Under the bill, the PSC must determine
whether the statewide and commitment to community programs have met their
goals on average over the quadrennium following the proceeding establishing the
goals. If a wholesale supplier accepts an assignment from more than one municipal
electric utility or retail electric cooperative, the PSC must determine whether the
relevant goals have been met on an aggregate basis. The PSC must also determine
whether utility-administered, supplemental utility, and large energy customer
programs have met their goals over the period of the program or another time period
determined by the PSC.
If the PSC determines that a program has failed to meet one or more goals, the
PSC must determine the reason for that failure. If the PSC determines that the
person responsible for the program made a good faith effort to meet the goals and that
the failure to do so was due to factors outside that person's control, the PSC must take
those factors into account in modifying goals when approving future programs
administered by that person. If the PSC determines that the person responsible for
the program did not make a good faith effort to meet the goals or that the failure to
do so was due to factors within that person's control, the PSC must implement
remedies specified in rules promulgated by the PSC. However, the PSC may find that
a person did not make a good faith effort only if the PSC finds that the person has
repeatedly or grossly failed to meet a goal or, with respect to a commitment to
community program, that the person administering the program did not determine
a funding amount that was reasonably necessary to meet the goal. In addition, the
PSC may promulgate rules specifying other conditions for finding that a person did
not make a good faith effort to meet a goal.
The bill requires that the remedies specified in the PSC's rules must be in
proportion to the magnitude of the failure and the degree to which the person did not
make a good faith effort or control the relevant factors. The potential remedies must
include an order that the person take corrective actions, which may include meeting
a goal in a time period specified by the PSC, in addition to meeting any other goals
that apply during that time period. In addition, for statewide programs, the
potential remedies must include the following: 1) an order that energy utilities or
a statewide programs contractor invoke any contractual remedies that imposes
monetary penalties for failure to meet a goal; 2) an order that the energy utilities
modify or terminate a contract with a statewide programs contractor; and 3) an order
that a statewide programs contractor terminate or modify any subcontract. For
utility-administered programs and large energy customer programs, the potential
remedies must include an order modifying or terminating the program. For
commitment to community programs, the potential remedies must include the
following: 1) modification or termination of a contract with, or assignment to, a
wholesale supplier; and 2) a requirement that a municipal electric utility or retail
electric cooperative enter into a contract with a statewide programs contractor.
Other changes. The bill makes other changes, including the following:
1. The bill creates additional requirements for the PSC's approval of
utility-administered, supplemental utility, and large energy customer programs.
The bill also clarifies that utility-administered and supplemental utility programs
must be limited to services related to regulated fuels and that supplemental utility
programs must be limited to an energy utility's customers. In addition, the bill allows
an energy utility to request PSC approval at any time to establish, modify, or
discontinue a utility-administered or supplemental utility program.
2. Current law requires that the PSC ensure that statewide and
utility-administered program costs are equitably divided among customer classes
and that customer classes have the opportunity to receive grants and benefits under
the programs in amounts equal to the amounts recovered from the class to fund the
programs. Under the bill, the PSC may allow a customer class the opportunity to
receive grants and benefits not equal to the amount recovered from the class if the
PSC finds that to do so is in the public interest and promotes the cost-effective
achievement of program goals.
3. The bill requires the PSC to promulgate rules for allowing, under specified
circumstances, an energy utility to earn a return on capital invested in energy
conservation or efficiency equipment under a utility-administered or supplemental
utility program.
4. The bill allows commitment to community programs to include renewable
resource programs, as well as the energy efficiency programs allowed under current
law.
5. Current law prohibits the PSC from imposing additional energy
conservation and efficiency requirements on energy utilities that have complied with
their duties under the statewide programs. The bill creates a similar prohibition
regarding municipal electric utilities and wholesale suppliers that have, on average,
complied with commitment to community program goals or have made a good faith
effort to comply.
6. Under current law, the PSC is required to annually contract for an audit of
statewide, utility-administered, supplemental utility, and large energy customer
programs. Under the bill, if an audit indicates that a program has failed to meet any
goal for any one year, the PSC must consult with the person administering the
program regarding ways to modify the program to ensure that it meets its goals.
7. The bill allows the PSC to recover its costs related to administering energy
efficiency and renewable resource programs through an assessment procedure
specified in current law.
8. The bill revises the definition of "renewable resource" so that it does not
include resources deriving energy from natural gas or nonbiological industrial,
commercial, or household waste. Under current law, a resource that derives energy
from natural gas used in a fuel cell is considered a renewable resource.
9. The bill requires the PSC to exercise its regulatory authority to ensure,
under certain circumstances, maximum reductions in the use of and demand for
regulated fuels.
10. The bill requires the PSC to ensure in its rate-making orders that
municipal electric utilities recover from ratepayers the amounts necessary to comply
with requirements for commitment to community programs. Current law imposes
a similar duty regarding energy utilities.
11. The bill requires the PSC to study whether its rules allow an adequate
opportunity for creating large energy customer programs and report its findings to
the legislature and governor.
Renewable portfolio standard
Under current law, electric utilities and retail electric cooperatives (electric
providers) are required to ensure that, in a given year, a specified percentage of the
electricity that the utility or cooperative sells to customers is generated from
renewable resources. These and related requirements are commonly referred to as
the renewable portfolio standard (RPS). The bill makes the following changes to the
RPS.
RPS deadlines. Under current law, the RPS includes deadlines that apply to
an electric provider's "renewable energy percentage" (REP). In general, an electric
provider's REP for a particular year is the percentage resulting from the proportion
in which the denominator is the total amount of electricity that the electric provider
sold to customers or members in the year and the numerator is the sum of the
following: 1) the amount of electricity derived from renewable resources that the
electric provider sold to its customers or members in the year; and 2) the amount of
any renewable resource credits (RRCs) that the electric provider elects to use in the
year. Current law generally prohibits an electric provider from decreasing its REP
in 2009 below the electric provider's "baseline renewable percentage" (BRP).
Current law defines BRP as the average of an electric provider's REP for 2001, 2002,
and 2003.
With certain exceptions, current law does the following: 1) in 2010, requires an
electric provider to increase its REP at least 2 percentage points above its BRP; 2)
in 2011 to 2014, prohibits an electric provider from decreasing its REP below the
percentage required in 2010; 3) in 2015, requires an electric provider to increase its
REP at least 6 percentage points above its BRP; and 4) in each year after 2015,
prohibits an electric provider from decreasing its REP below the percentage required
in 2015.
The bill changes the foregoing deadlines as follows: 1) in 2013, rather than in
2015, an electric provider must increase its REP at least 6 percentage points above
its BRP; 2) in 2014 to 2019, an electric provider may not decrease its REP below the
percentage required in 2013; 3) in 2020, an electric provider must increase its REP
at least 16 percentage points above its BRP; 4) in 2021 to 2024, an electric provider
may not decrease its REP below the percentage required in 2020; 5) in 2025, an
electric provider must increase its REP at least 21 percentage points above its BRP;
and 6) in each year after 2025, an electric provider may not decrease its REP below
the percentage required in 2025.
In addition, the bill imposes requirements for an electric provider's "in-state
percentage" (ISP), which is defined as the percentage of an electric provider's REP
that is derived from in-state renewable resources. In 2020, an electric provider's ISP
may not be less than 30 percent of the electric provider's REP; and in 2021 to 2024,
an electric provider's ISP may not be less than that required in 2020. In 2025, an
electric provider's ISP may not be less than 40 percent of the electric provider's REP;
and in each year after 2025, an electric provider's ISP may not be less than that
required in 2025.
REPs and RRCs. Current law allows an electric provider to create RRCs
based on the amount by which the electric provider exceeds an REP required for a
particular year. An electric provider may sell an RRC to another electric provider,
and the purchaser may use the RRC to comply with an RPS deadline. Alternatively,
an electric provider may save the RRC for its own future use. Saving an RRC in such
a manner is referred to as "banking" an RRC. In general, banked RRCs expire after
the fourth year after the year in which they are created, except that RRCs created
before 2005 expire at the end of 2011. Current law requires the PSC to promulgate
rules for administering RRCs and participating in a regional system for tracking and
trading RRCs.
The bill creates new requirements for RRCs that replace the requirements
described above. The bill specifies that one RRC is created at the time that a person
generates one megawatt (MW) hour of renewable energy, and allows a person to sell
renewable energy with associated RRCs, or separate RRCs from renewable energy
and sell, trade, transfer, assign, bank, or permanently retire the RRCs. However, for
renewable energy that is sold at wholesale, the bill specifies that the sale includes
the associated RRCs unless an agreement between the parties specifies otherwise.
In addition, the bill provides that RRCs associated with renewable energy produced
at certain hydroelectric plants must be used in the year in which the RRCs are
created and may not be banked, sold, or traded.
Because RRCs are created at the time renewable energy is generated, rather
than as the result of an electric provider exceeding an REP for a particular year, the
bill eliminates renewable energy sold in a year from the numerator used to determine
an electric provider's REP. As result, in general, the numerator consists of RRCs that
an electric provider elects to use in a particular year. However, the bill requires the
PSC to promulgate rules that allow an electric generator also to include in the
numerator any renewable energy generated or purchased by the electric provider
from which RRCs have not been separated. In addition, as noted below, an electric
provider may also include in the numerator certain types of nonelectric energy.
Under the bill, if a person purchases renewable energy from which RRCs have
not been separated, the purchaser has the same options with respect to the RRCs as
the generator of the renewable energy. Also, a person who purchases RRCs has the
same options with respect to the RRCs as the person who separated the RRCs from
the renewable energy. An electric provider may use an RRC that it obtains to comply
with an RPS deadline, except for RRCs that have been used to comply with the
renewable energy requirements of another state. The bill also requires the PSC to
promulgate rules for creating, selling, trading, transferring, assigning, banking, and
retiring RRCs and tracking RRCs under a regional credit tracking system
designated by the PSC.
Nonelectric energy. The bill allows an electric provider to include in the
numerator of its REP the following types of nonelectric energy to comply with an RPS
deadline: 1) the thermal output from cogeneration production plants, certain
biomass-fueled boilers, geothermal systems, or solar water heating systems; 2)
biogas that is put into a natural gas transmission or distribution pipeline; 3) useable
light delivered by a solar light pipe; and 4) other nonelectric energy derived from a
renewable resource specified by the PSC by rule. The bill allows an electric provider
to use nonelectric energy for an RPS deadline only if the energy is generated at an
in-state facility that is placed in service after the effective date of the bill and the
energy displaces the use of fossil fuel in this state. In addition, nonelectric energy
may be used for an RPS deadline only in the year in which the energy is generated.
Also, an electric provider may not create an RRC based on nonelectric energy.
Instead, the bill allows any person, including a person that is not an electric provider,
to create a certificate documenting the nonelectric energy generated by the person,
and the bill allows for the sale of certificates to electric providers to comply with RPS
deadlines. The PSC must promulgate rules implementing the nonelectric energy
provisions of the bill, including rules for determining the MW hour equivalent of
nonelectric energy.
Hydroelectric energy. Under current law, an electric provider may not use
electricity generated from hydroelectric facilities to satisfy an RPS deadline if the
facility has a generating capacity of 60 MWs or more. The bill creates an exception
to the foregoing prohibition for electricity generated after December 31, 2013, by
out-of-state facilities that are placed in service on or after the bill's effective date.
However, if such an out-of-state facility is located in the Province of Manitoba, the
electricity may be used to satisfy an RPS deadline only if both of the following
requirements are satisfied: 1) the Province of Manitoba informs the PSC in writing
that final licenses have replaced interim licenses for two specified hydroelectric
projects in the province and the projects have received all final approvals, licenses,
and permits applicable to them under Canadian law; and 2) the PSC determines that
there has been a reasonable resolution of the concerns of the First Nations affected
by the projects. The First Nations is the Canadian equivalent of Native American
tribes.
Wholesale suppliers. The bill allows a wholesale supplier to demonstrate
compliance with an RPS deadline on behalf of its members or customers, individually
or in the aggregate. In addition, the bill eliminates an option under current law for
a wholesale supplier to request the PSC to allow a delay in complying with an RPS
deadline. However, the bill does not affect another option under current law for
wholesale suppliers to obtain such a delay.
PSC reports. Current law requires the PSC to report on whether the state has
met a goal that, by December 31, 2015, 10 percent of all electric energy consumed in
the state is renewable energy. The bill moves the goal to December 31, 2013. In
addition, the bill requires the PSC to report on whether, by December 31, 2020, 20
percent of electric energy consumed in the state is renewable energy and whether 6
percent of electric energy consumed in this state is generated from in-state
renewable energy facilities. Also, the PSC must report on whether, by December 31,
2025, 25 percent of electric energy consumed in the state is renewable energy and
whether 10 percent of electric energy consumed in this state is generated from
in-state renewable energy facilities.
Other changes. The bill makes other changes related to the RPS, including
the following:
1. The bill makes legislative findings regarding the RPS, including findings
regarding the need to adopt an RPS that includes requirements for in-state sources
of renewable energy.
2. The bill prohibits the PSC from imposing additional renewable energy
requirements on a municipal utility that is compliance with the RPS. Under current
law, the prohibition applies to investor-owned, but not municipally owned, utilities.
3. The bill allows an electric provider to use electricity generated by the
combustion of solid waste to satisfy an RPS deadline, but only if the solid waste has
been subject to a process to remove recyclable and noncombustible materials and the
solid waste is burned in a facility owned by a county in this state that was in service
before January 1, 1998.
4. For a facility that burns fossil fuel with any combination of biomass, solid
waste, or refuse-derived fuel, the bill creates a formula for determining the amount
of electricity or thermal energy produced by the facility that an electric provider may
use to comply with an RPS deadline. The formula replaces a formula under current
law that applies to facilities that burn biomass and fossil fuels.
5. Under current law, with certain exceptions, the PSC must consider
alternative locations when the PSC determines whether to grant a certificate of
public convenience and necessity that is required before a person can begin
construction of a proposed electric generating facility with a capacity of 100 MW or
more. Under the bill, if the proposed facility generates electricity from renewable
resources, the PSC may, but is not required to, consider alternative locations. Also,
for a proposed facility that generates electricity from renewable resources that has
a capacity of less than 100 MW, the bill imposes deadlines on the PSC's consideration
of an application for a different certificate that is required for such a facility.
6. The bill requires the PSC, in scheduling its business, to give priority to the
consideration of applications for constructing electric generating facilities of any
capacity that generate electricity from renewable resources.
7. The bill requires the PSC to submit a study to the legislature and governor
on options for ensuring that electric providers are able to comply with the RPS.
8. The bill requires the Department of Transportation (DOT) to submit a report
to the legislature and governor on regulatory barriers to the transport of wind
turbine components over the state's highways. The report must describe actions
DOT has taken to remove the barriers, as well as recommend legislation to remove
the barriers.
9. The bill repeals outdated requirements regarding the construction of
renewable energy facilities by certain public utilities in the eastern part of the state.
Renewable energy offer to purchase orders
With certain exceptions, this bill requires the PSC to issue an order directed at
each retail electric utility that requires such a utility to offer to purchase the
renewable energy generated at renewable facilities within the utility's service
territory that are constructed after the effective date of the PSC's order. The bill
defines "renewable facility" as an electric generating facility that derives energy
from: 1) photovoltaic energy; 2) wind power; 3) gas made from renewable resources
specified under the renewable portfolio standard statute; or 4) any other renewable
resource specified by the PSC. In addition, to qualify as a "renewable facility," the
facility must be a small-scale facility, as determined by the PSC.
The PSC's orders must specify standard purchase terms for each type of
renewable facility, including terms for prices paid for renewable energy, payment
schedules, and maximum limits on generating capacity. In specifying terms for
renewable energy prices, the PSC must consider production costs, reasonable rates
of return on investment, and state and federal incentives available to facility owners
and operators. The PSC's orders may also include any of the following: 1)
requirements for adjusting the standard purchase terms based on changes in
operating costs; 2) different prices for renewable energy generated at renewable
facilities of the same type that have different generating capacities; or 3) other
conditions specified by the PSC. The PSC's orders must also prescribe for each type
of renewable facility a standardized agreement incorporating the applicable terms
and conditions.
The bill allows the PSC to limit a requirement upon a utility to purchase
renewable energy from renewable facilities under an order described above. The
PSC may base a limit on the number of renewable facilities, the total installed
generating capacity of renewable facilities, or the total amount of renewable energy
that must be purchased. However, the PSC may limit a requirement upon a utility
only if the limit is consistent with the purpose of the bill's requirements regarding
the orders, which the bill specifies is to maximize the development and deployment
of distributed renewable energy generation technologies used at renewable facilities
without unreasonable impacts on rates.
The bill also allows the PSC to exempt small and large retail electric utilities
from certain of the above requirements. Under the bill, a small utility is one that had
retail electric sales of less than 2,500,000 megawatt hours in 2008, and a large utility
is one that had retail electric sales of 2,500,000 megawatt hours or more in 2008. For
a small or large utility, the PSC may exempt the utility from the requirement to
purchase renewable energy from particular types of renewable facilities. For a large
utility, the PSC may exempt the utility from all of the above requirements. However,
a large utility is not eligible for either of the foregoing exemptions unless the PSC
finds that the utility's voluntary initiatives are consistent with the purpose of the
bill's requirements regarding the orders, as described above.
The bill also does the following:
1) Requires the PSC to periodically review its orders and, as appropriate, revise
the standardized agreements prescribed in the orders.
2) Specifies that a utility that purchases renewable energy as directed in an
order acquires the renewable resource credits associated with the generation of the
renewable energy, unless otherwise specified by the parties.
3) Allows a utility and owner or operator of a renewable facility to agree to
renewable energy purchases on terms and conditions that differ from those specified
in an order.
4) Provides that a limit on the PSC's authority under current law regarding
renewable resource requirements applies to any electric public utility, rather than
to an investor-owned electric public utility as under current law.
Nuclear power plants
Under current law, a person may not begin construction of an electric
generating facility with a nominal operating capacity of 100 MW or more unless the
PSC grants a certificate of public convenience and necessity (CPCN) for the proposed
facility. In addition, a public utility may not engage in certain projects regarding its
plant, such as extending or improving existing facilities, unless the PSC grants a
certificate of authority (CA) for the proposed project. Additional requirements apply
to a nuclear power plant with a nominal operating capacity of 100 MW or more.
Current law prohibits the PSC from granting a CPCN for the proposed construction
of such a plant, or a CA for a proposed project regarding such a plant, unless the PSC
makes two findings which are in addition to the CPCN or CA requirements that
otherwise apply. First, the PSC must find that a facility inside or outside the United
States is available for adequate disposal of all high-level nuclear waste from all
nuclear power plants operating in this state, including the proposed plant. Second,
the PSC must find that the proposed plant, in comparison with feasible alternatives,
is economically advantageous to ratepayers. The second finding must be based on
the following factors: 1) the existence of a reliable and adequate nuclear fuel supply;
2) the costs for constructing, operating, and decommissioning nuclear power plants
and for disposing of nuclear waste; and 3) any other factor having an impact on the
economics of nuclear power plants, as determined by the PSC.
The bill makes changes to the foregoing findings. However, the changes are
delayed until the first date on which all rules and orders of the PSC are in effect that
are necessary to initially implement the changes made by the bill to energy efficiency
and renewable resource programs and the RPS. The PSC must publish a notice
identifying that date in the Wisconsin Register. This analysis refers to that date as
the "register date."
For CPCNs and CAs for nuclear power plants that are granted on or after the
register date, the bill eliminates the first finding required under current law
regarding waste disposal. Instead, the bill prohibits the the PSC from granting a
CPCN or CA on or after the register date for a proposed nuclear power plant unless
the PSC finds the following: 1) the plan for managing the nuclear waste from the
nuclear power plant is economic, reasonable, stringent, and in the public interest; 2)
the nuclear power plant will provide electricity to ratepayers or members of electric
cooperatives in this state at a reasonable cost based on specified criteria; and 3) the
entire output of electricity produced by the nuclear power plant will be needed and
used to meet the state's expected requirements for electricity. As for the second
finding required under current law, which is that the nuclear power plant must be
economically advantageous to ratepayers, the bill requires the PSC to consider the
benefits to the state and the environment resulting from reductions of air pollutant
emissions from the nuclear power plant, in addition to considering the factors
required under current law. However, the additional factor must be considered only
for a CPCN or CA granted on or after the register date. Also, for a CPCN or CA
granted on or after the register date, the finding is limited to the economic
advantages for ratepayers or cooperative members in this state.
The bill also provides that, after the register date, a CPCN is required for the
proposed construction of a nuclear power plant of any nominal operating capacity.
As noted above, current law requires a CPCN only if the nominal operating capacity
is 100 MW or more. In addition, after the register date, the bill requires a CA for a
project involving a nuclear power plant owned or operated by an entity that is not
a public utility. Under current law, the CA requirements apply only to public
utilities. The bill also allows the PSC to attach terms and conditions in the public
interest to CPCNs and CAs granted on or after the register date for nuclear power
plants. The bill specifies that such terms and conditions apply to any successor in
interest to the entity that is granted the CPCN or CA.
As noted above, the bill requires the PSC to find that the entire output of the
electricity produced by a proposed nuclear power plant will be needed and used to
meet the state's expected requirements. The bill includes a nonseverability clause
that provides that if a court finds that the foregoing requirement is unconstitutional,
then all of the changes made by the bill regarding nuclear power plants are void.
The bill makes other changes, including the following:
1. The bill makes legislative findings regarding the authority of the state to
make the changes described above, as well as the necessity for the changes.
2. The bill allows the PSC to order the owner or operator of a nuclear power
plant to provide financial assurance for decommissioning the plant and disposing of
spent nuclear fuel. However, the PSC's authority applies only to a nuclear power
plant for which the PSC grants a CPCN on or after the register date.
3. The bill requires the PSC to promulgate service standards for nuclear power
plants owned or operated by nonutilities for which the PSC grants a CPCN after the
register date. Under current law, the PSC's authority to promulgate such rules is
limited to plants owned or operated by public utilities.
4. Current law allows the PSC to extend the deadline that applies to its
consideration of applications for CPCNs. Beginning on the register date, the bill
allows the PSC to make an additional extension for applications for CPCNs for
nuclear power plants.
5. The bill provides that, after the register date, nuclear power plants that do
not provide retail service are treated in the same manner as wholesale merchant
plants under current law, except that, for CPCNs granted on or after the register date
to such nuclear power plants, the PSC must consider certain alternatives that the
PSC is not required to consider for wholesale merchant plants.
6. The bill makes certain requirements under current law that apply to public
utilities also applicable to nonutility owners and operators of nuclear power plants
for which CPCNs are granted on or after the register date. These requirements
concern the following: 1) the PSC's authority to obtain information and related
penalties; 2) forfeitures that apply to violations subject to the PSC's jurisdiction; and
3) PSC approval required for selling, acquiring, leasing, or renting plants, operating
units, or systems.
Motor vehicle emission standards
Under the federal Clean Air Act (the act), the federal Environmental Protection
Agency (EPA) sets limits on pollutants that may be emitted by motor vehicles. The
act generally prohibits states from enacting motor vehicle emission limitations that
differ from the federal limitations, but the act allows California to enact limitations
that differ from the federal limitations under certain circumstances. To implement
differing limitations, California must obtain a waiver from the EPA administrator.
The act allows other states to enact motor vehicle emission limitations that are
identical to limitations for which California has obtained a federal waiver.
California has enacted emission limitations that are stricter than EPA's
emission limitations for motor vehicles, including greenhouse gas emission
limitations for passenger cars, light-duty trucks, and medium-duty passenger
vehicles. The California greenhouse gas limitations basically specify requirements
for the average amount of greenhouse gas emissions from vehicles produced by a
manufacturer that are delivered for sale in the state. California has also enacted
regulations that require certain motor vehicle manufacturers (based on the volume
of vehicle sales in California) to deliver zero emission vehicles for sale in California.
A zero emission vehicle is a vehicle that is certified by the California Air Resources
Board to produce no emissions of certain air pollutants (for example, a
battery-powered or fuel cell car).
This bill requires DNR to promulgate rules specifying emission limitations for
passenger cars, light-duty trucks, and medium-duty passenger vehicles that are
identical to the California emission limitations, including the greenhouse gas
emission limitations, but not including the zero emission vehicle requirements.
The bill authorizes DNR to promulgate rules that are identical to the California
zero emission vehicle requirements if DNR determines that those requirements
would be an effective and efficient part of the strategy for this state to meet its
greenhouse gas emission reduction goals. The bill also requires DNR to study any
greenhouse gas emission reduction requirements applicable to other motor vehicles
that California adopts after October 1, 2009, and to report the results of its study to
the legislature.
Low carbon fuel standard
This bill requires DNR to promulgate a rule requiring the reduction in the
carbon intensity of transportation fuels sold in this state, if specified conditions are
met. This kind of requirement is referred to as a low carbon fuel standard. Carbon
intensity is a measure of the amount of greenhouse gases emitted in producing,
distributing, and using a fuel per unit of energy produced by the fuel. The bill
requires DNR to promulgate the rule if an advisory group to the Midwestern
Governors Association (MGA) makes recommendations on the design of a low carbon
fuel standard and the recommendations are endorsed by the governors of a majority
of the states whose governors endorsed the MGA Energy Security and Climate
Stewardship Platform in 2007, including Wisconsin's governor. The DNR rule must
be consistent with the advisory group's recommendations. The bill requires DNR to
cooperate with other states in its activities related to the low carbon fuel standard,
including in operating a regional system for trading credits that may be used to
comply with the low carbon fuel standard.
Assistance to communities
This bill modifies several programs that provide financial assistance to
municipalities, and in some cases counties, to encourage activities that will result in
a reduction of travel, energy use, or emissions of greenhouse gases or that are located
in qualified areas. A qualified area is, generally, an area that is designated for
traditional neighborhood development, is subject to the voluntary energy-saving
building design standards that are established by Commerce under this bill, or is
involved in the Green Tier Program, under which entities voluntarily undertake
actions to improve the environment, if those actions are likely to result in significant
reductions in emissions of greenhouse gases or energy use. A "traditional
neighborhood" is a compact, mixed-use neighborhood where residential,
commercial, and civic buildings are in close proximity to each other.
Brownfields site assessment grants
Under current law, DNR administers the Brownfields Site Assessment
Program under which it provides grants to local governmental units for the purpose
of investigating environmental contamination, removing abandoned containers, and
conducting demolition at brownfields. "Brownfields" are industrial or commercial
sites that are abandoned, idle, or underused because of actual or perceived
environmental contamination. Current law requires the recipient of a grant under
the program to provide matching funds of at least 20 percent of the amount of the
grant.
This bill authorizes DNR, in awarding grants under the program, to give extra
weight to projects that will result in a reduction of travel, energy use, or emissions
of greenhouse gases or that are located in qualified areas. The bill also authorizes
DNR to promulgate a rule that reduces the amount of matching funds that are
required under the program for such a project to below 20 percent of the amount of
the grant.
Forward innovation fund
Under current law, Commerce may award grants or loans from the Forward
Innovation Fund (FIF) to certain eligible recipients, including municipalities, to
undertake certain eligible activities, including innovative proposals to strengthen
inner cities and rural areas. Recipients of a grant or loan under the FIF must provide
a match of 25 percent of the grant or loan.
This bill requires Commerce to give additional consideration to an eligible
activity proposed by an eligible recipient that is the governing body of a municipality
if the eligible activity will result in a reduction in travel, energy use, or the emission
of greenhouse gases, or if the eligible activity is located in a qualified area.
Commerce is authorized to establish, by rule, a match of less than 25 percent for a
municipality that receives a grant or loan if the grant or loan is awarded to that
municipality for an eligible activity that will result in a reduction in travel, energy
use, or the emission of greenhouse gases or that is located in a qualified area.
State Main Street Program
Also under current law, Commerce administers a State Main Street Program.
Under the State Main Street Program, Commerce provides assistance to
municipalities with the revitalization of business areas in the municipalities. Each
year, Commerce selects up to five municipalities to participate in the program. This
bill permits Commerce to give additional consideration to the application of a
municipality that has proposed a project that is a "qualifying project." A "qualifying
project" is defined by the bill as a project that will result in a reduction in travel,
energy use, or the emission of greenhouse gases or that is located in a qualified area.
Brownfields grant program
