LRB-2740/2
MDK/GMM/MES:cjs&nwn:md
2009 - 2010 LEGISLATURE
February 17, 2010 - Introduced by Representatives Mason, Soletski, Zigmunt,
Grigsby, Molepske Jr., Fields, Young, Roys, Colon, Berceau, A. Williams,
Zepnick and Toles, cosponsored by Senator Holperin. Referred to Committee
on Jobs, the Economy and Small Business.
AB755,1,11
1An Act to renumber 16.26 and 196.374 (5) (a);
to amend 66.0627 (8), 103.49 (3)
2(ar), 109.09 (1), 111.322 (2m) (c), 196.374 (4) (b), 196.374 (5) (b) 1., 196.374 (5)
3(b) 2., 196.374 (5) (bm) 1., 196.374 (5m) (a), 196.378 (1) (i), 196.378 (3) (a) 1.,
4196.378 (3) (c), 227.01 (13) (t), 946.15 (1), 946.15 (2), 946.15 (3) and 946.15 (4);
5and
to create 16.26 (2), 196.374 (2) (b) 2m., 196.374 (2) (d), 196.374 (5) (a) 2.,
6196.3745, 196.378 (3) (a) 1m. and 709.03 (form) C. 25m. of the statutes;
7relating to: allowing certain utilities to administer investment programs for
8energy efficiency improvements and renewable energy applications, creating
9requirements for political subdivision loans for similar improvements and
10applications, providing an exemption from emergency rule procedures, and
11granting rule-making authority.
Analysis by the Legislative Reference Bureau
This bill allows the Public Service Commission (PSC) to authorize an electric,
natural gas, or water public utility (utility) to administer, fund, or provide
administrative services for a program for investing in energy efficiency
improvements and renewable resource applications at any type of premises served
by the utility. The bill defines "energy efficiency improvement" as an improvement
that reduces the usage of energy or increases the efficiency of energy usage at
premises, and the bill defines "renewable resource application" as the application of
specified renewable energy resources, such as, for example, solar or wind power, at
premises. The bill allows the PSC to authorize a program only upon application by
a utility and prohibits the PSC from requiring that utilities participate in such a
program. In addition, if the utility is an investor-owned electric or natural gas utility
(energy utility), the PSC may authorize a program only if the PSC finds the program
is cost-effective. The bill requires a utility for which the PSC authorizes a program
to file a tariff with the PSC that specifies the terms and conditions of utility and
nonutility service provided to customers at premises where energy efficiency
improvements or renewable resource applications are made under the program. A
tariff has no effect until approved by the PSC.
In addition, the bill specifies that premises are not eligible for an investment
under an authorized program unless an audit is performed that demonstrates that
an energy efficiency improvement or renewable resource application is
cost-effective, as specified in rules promulgated by the PSC. The rules may specify
criteria that include comparing the cost of an improvement or application to the
value of the premises. In addition, for an energy efficiency improvement, the rules
may specify criteria that include the energy savings resulting from the improvement
and the period of time required for the energy savings to equal the cost of the
improvement. In addition, the PSC must promulgate rules requiring the
performance of audit after an energy efficiency improvement or renewable resource
application is made or installed. The purpose of such a postaudit is to verify that the
improvement or application was made or installed. The bill requires the PSC to
promulgate rules specifying the certification requirements that a person must
satisfy to perform either type of audit.
The bill also requires that all work involved in making or installing an energy
efficiency improvement or renewable resource application under an authorized
program must be performed by a contractor or subcontractor that the PSC has
included on a prequalification list of approved contractors and subcontractors. The
PSC may include a contractor or subcontractor on the list only if the PSC determines
that the contractor or subcontractor satisfies certain requirements, including the
following: 1) agrees to comply with prevailing wage and substance abuse prevention
requirements that apply to certain public works projects; 2) certifies that employees
are not improperly classified as independent contractors in violation of federal or
state law; 3) satisfies cultural competency requirements in rules promulgated by the
PSC; 4) certifies every three years that not less than 30 percent of the total hours
worked on an individual energy efficiency improvement or renewable resource
application will be performed by individuals who had incomes in the prior year that
do not exceed 200 percent of federal poverty guidelines and who reside in the 1st or
2nd class city where the work is performed, or, if the work is not performed in a 1st
or 2nd class city in the county where the work is performed; and 5) discloses certain
past disciplinary actions and violations of federal or state law. If the past disciplinary
actions and violations constitute "good cause," as defined by the PSC by rule, the PSC
may exclude a contractor or subcontractor from the list. In addition, the PSC must
determine that a contractor or subcontractor has agreed to sponsor an
apprenticeship program administered by the Department of Workforce
Development. However, the bill allows work to be performed by a contractor or
subcontractor who does not sponsor such a program, but only if contractors and
subcontractors who sponsor such a program are not available to perform the work.
The bill also imposes the requirements described above regarding audits and
prequalification on certain loans made under current law by cities, villages, towns,
and counties (political subdivisions). Under current law, a political subdivision is
authorized to make to make a loan to a resident for making or installing an energy
efficiency improvement or renewable resource application to the resident's
residential property. Current law allows a political subdivision to collect loan
repayments as special charges, divide the special charges into installments, and
include the special charges in tax rolls even if they are not delinquent. The bill allows
political subdivisions to make the loans for any type of premises, not just residential
property as under current law. In addition, a premises is not eligible for a loan unless
the audit requirements described above are satisfied. The post-audit requirements
also apply to the loans. Also, all work on energy efficiency improvements and
renewable resource applications made or installed pursuant to a loan must be
performed by contractors and subcontractors who are included on the
prequalification list described above.
The bill also includes requirements for utilities and political subdivisions to
prioritize spending on utility programs authorized under the bill and political
subdivision loans. For utility spending whose source is a grant by the PSC, the utility
must give the greatest priority to energy efficiency improvements and renewable
resource applications at residential premises and the least priority to energy
efficiency improvements and renewable resource applications at nonresidential
premises of customers with the greatest demand for utility service. For utility
spending from other sources, the priorities are reversed. For political subdivision
loans, the bill requires political subdivisions to give the greatest priority to energy
efficiency improvements and renewable resource applications at residential
premises and the least priority to nonresidential premises of utility customers with
the greatest demand for utility services. The PSC must promulgate rules
implementing the priorities and requiring utilities and political subdivisions to
make annual reports regarding implementation of the priorities.
The bill also does all of the following:
1. Requires the PSC to make grants to political subdivisions for loans described
above and to utilities for programs authorized under the bill. The bill directs the PSC
to make the grants from certain federal block grants that the state receives under
a program administered by the federal Department of Energy under the American
Recovery and Reinvestment Act of 2009. The bill also requires the PSC to allocate
the federal grants in the manner required under the federal program.
2. Requires political subdivisions and utilities that receive payments from
residents and customers for energy efficiency improvements and renewable resource
applications under authorized utility programs and political subdivision loans to use
the payments to invest in other improvements and applications.
3. Requires a tariff filed by a utility for which a program is authorized to include
contracts between the utility and an owner of property benefited by an energy
efficiency improvement or renewable resource application. The contracts must
require the owner to do the following: a) inform lessees that are liable for utility
service that the cost of the improvement or application will appear on the lessees'
utility bills; and b) inform a purchaser of the property that the purchaser, or any
other person who is liable for utility service at the property, is liable for the unpaid
costs of the improvement or application, and that such costs will appear on utility
bills for the property.
4. Allows a utility that participates in the program to include a separate line
item on customer bills that compares certain costs of the program with energy
savings resulting from an energy efficiency improvement or renewable resource
application made under the program.
5. Prohibits a utility with an authorized program from recovering from
ratepayers any bad debt related to nonutility services provided under the program.
6. Specifies that, if a utility with an authorized program is an energy utility,
the PSC must ensure in rate-making orders that the utility recovers from its
ratepayers the amounts spent on the program at a rate of return equal to the utility's
overall rate of return authorized by the PSC.
7. Requires an owner of residential property to make a disclosure about an
energy efficiency improvement or renewable resource application made under an
authorized utility program on the real estate conditions report that is required for
residential property transfers.
8. Requires contractors and subcontractors to apply to renew their inclusion
on the prequalification list every two years, allows the PSC to conditionally approve
a contractor or subcontractor for inclusion on the list, allows the PSC to revoke
inclusion for "good cause," as defined in rules promulgated by the PSC, and requires
the PSC to update the list on a monthly basis and make the list available to the
public.
9. Requires the PSC to promulgate a rule or issue an order that prohibits any
work under contracts under energy efficiency and renewable resource programs
administered by the PSC under current law from being performed by contractors and
subcontractors who are not included on the prequalification list described above.
However, the rule or order must allow performance of work by contractors and
subcontractors who do not satisfy the apprenticeship requirements only if
contractors and subcontractors who do satisfy the requirements are not available to
perform the work.
10. Requires DOA to promulgate a rule similar to the rule described above that
applies to work under contracts under a federal weatherization program
administered by DOA under current law.
11. Prohibits an energy utility from counting any spending under a program
authorized under the bill toward compliance with requirements under current law
for spending a specified percentage of the energy utility's annual operating revenues
on energy efficiency and renewable resource programs.
Finally, current law requires certain electric utilities and cooperatives to
ensure that, in a given year, a specified percentage of the electricity it sells at retail
is derived from renewable resources. These requirements are commonly referred to
as renewable portfolio standards (RPSs). Current law also allows electric utilities
and cooperatives to create credits based on the amount of electricity derived from
renewable resources that is sold at retail in a year and that exceeds the RPS for the
year. Subject to certain restrictions, an electric utility or cooperative may use the
credit in a subsequent year to help comply with an RPS, or sell the credit to another
electric utility or cooperative to help the buyer comply with an RPS. This bill requires
the PSC to promulgate rules that allow an electric utility to create an additional
credit that can be used or sold like the credits under current law. The PSC's rules
must allow for the creation of credits that are based on the reductions in energy
usage, increases in efficiency of electricity usage, and generation of renewable
energy that results from an energy efficiency improvement or renewable resource
application under a program authorized by the PSC under the bill, but only if the
spending source for the improvement or application is not a PSC grant under the bill.
The PSC's rules must include requirements for measuring the amount of such
reductions, increases, and generation, and calculating the amount of a credit. In
addition, the bill eliminates the requirement under current law that a credit must
be used in a year subsequent to the the year in which it is created or purchased.
For further information see the state and local fiscal estimate, which will be
printed as an appendix to this bill.
The people of the state of Wisconsin, represented in senate and assembly, do
enact as follows:
AB755, s. 1
1Section
1. 16.26 of the statutes is renumbered 16.26 (1).
AB755, s. 2
2Section
2. 16.26 (2) of the statutes is created to read:
AB755,6,23
16.26
(2) The department shall prohibit by rule the performance of any work
4under a contract entered into under sub. (1) by a contractor or subcontractor who is
5not included in the list specified in s. 196.3745 (5) (a), except that the department's
6rule shall allow the performance of work by a contractor or subcontractor who does
7not satisfy the requirement under s. 196.3745 (5) (a) 3. if no contractor or
8subcontractor who satisfies the requirement is available to perform the work. This
1subsection applies to contracts that are entered into, extended, modified, or renewed
2on the effective date of the department's rule.
AB755,6,135
66.0627
(8) A Subject to s. 196.3745, a political subdivision may make a loan
6to a resident of the political subdivision for making or installing an energy efficiency
7improvement or a renewable resource application to the resident's
residential 8property premises. If a political subdivision makes such a loan, the political
9subdivision may collect the loan repayment as a special charge under this section.
10Notwithstanding the provisions of sub. (4), a special charge imposed under this
11subsection may be collected in installments and may be included in the current or
12next tax roll for collection and settlement under ch. 74 even if the special charge is
13not delinquent.
AB755,6,2216
103.49
(3) (ar) In determining prevailing wage rates under par. (a) or (am), the
17department may not use data from projects that are subject to this section, s. 66.0903,
1866.0904, 103.50,
196.3745 (5) (a) 1., or 229.8275 or
40 USC 3142 unless the
19department determines that there is insufficient wage data in the area to determine
20those prevailing wage rates, in which case the department may use data from
21projects that are subject to this section, s. 66.0903, 66.0904, 103.50,
196.3745 (5) (a)
221., or 229.8275 or
40 USC 3142.
AB755,7,21
1109.09
(1) The department shall investigate and attempt equitably to adjust
2controversies between employers and employees as to alleged wage claims. The
3department may receive and investigate any wage claim which is filed with the
4department, or received by the department under s. 109.10 (4), no later than 2 years
5after the date the wages are due. The department may, after receiving a wage claim,
6investigate any wages due from the employer against whom the claim is filed to any
7employee during the period commencing 2 years before the date the claim is filed.
8The department shall enforce this chapter and ss. 66.0903, 66.0904, 103.02, 103.49,
9103.82, 104.12,
196.3745 (5) (a) 1., and 229.8275. In pursuance of this duty, the
10department may sue the employer on behalf of the employee to collect any wage claim
11or wage deficiency and ss. 109.03 (6) and 109.11 (2) and (3) shall apply to such actions.
12Except for actions under s. 109.10, the department may refer such an action to the
13district attorney of the county in which the violation occurs for prosecution and
14collection and the district attorney shall commence an action in the circuit court
15having appropriate jurisdiction. Any number of wage claims or wage deficiencies
16against the same employer may be joined in a single proceeding, but the court may
17order separate trials or hearings. In actions that are referred to a district attorney
18under this subsection, any taxable costs recovered by the district attorney shall be
19paid into the general fund of the county in which the violation occurs and used by that
20county to meet its financial responsibility under s. 978.13 (2) (b) for the operation of
21the office of the district attorney who prosecuted the action.
AB755,8,224
111.322
(2m) (c) The individual files a complaint or attempts to enforce a right
25under s. 66.0903, 66.0904, 103.49,
196.3745 (5) (a) 1., or 229.8275 or testifies or
1assists in any action or proceeding under s. 66.0903, 66.0904, 103.49,
196.3745 (5)
2(a) 1., or 229.8275.
AB755, s. 7
3Section
7. 196.374 (2) (b) 2m. of the statutes is created to read:
AB755,8,64
196.374
(2) (b) 2m. The commission may authorize an energy utility to
5administer, fund, or provide administrative services for a program described in s.
6196.3745 (2) if the commission finds that the program is cost-effective.
AB755, s. 8
7Section
8. 196.374 (2) (d) of the statutes is created to read:
AB755,8,168
196.374
(2) (d)
Contractors. The commission shall prohibit, by order or rule,
9the performance of any work under a contract under a program under par. (a) 1., (b)
101. or 2., or (c) by a contractor or subcontractor who is not included in the list specified
11in s. 196.3745 (5) (a), except that the commission's order or rule shall allow the
12performance of work by a contractor or subcontractor who does not satisfy the
13requirement under s. 196.3745 (5) (a) 3. if no contractor or subcontractor who
14satisfies the requirement is available to perform the work. This paragraph applies
15to contracts that are entered into, extended, modified, or renewed on the effective
16date of the commission's order or rule.
AB755, s. 9
17Section
9. 196.374 (4) (b) of the statutes is amended to read:
AB755,8,2518
196.374
(4) (b) An energy utility that provides financing under an energy
19efficiency program under sub. (2) (b) 1. or 2. for installation, by a customer, of energy
20efficiency or renewable resource processes, equipment, or appliances, or an affiliate
21of such a utility, may not sell to or install for the customer those processes,
22equipment, appliances, or related materials.
The
Subject to any order or rule of the
23commission under sub. (2) (d), the customer shall acquire the installation of the
24processes, equipment, appliances, or related materials from an independent
25contractor of the customer's choice.
AB755, s. 10
1Section
10. 196.374 (5) (a) of the statutes is renumbered 196.374 (5) (a) 1.
AB755, s. 11
2Section
11. 196.374 (5) (a) 2. of the statutes is created to read:
AB755,9,73
196.374
(5) (a) 2. The commission shall ensure in rate-making orders that an
4energy utility recovers from its ratepayers the amounts the energy utility spends for
5a program authorized under sub. (2) (b) 2m. and that an energy utility is allowed to
6earn a rate of return on such amounts that is equal to the energy utility's overall rate
7of return authorized by the commission.
AB755, s. 12
8Section
12. 196.374 (5) (b) 1. of the statutes is amended to read:
AB755,9,149
196.374
(5) (b) 1. Except as provided in sub. (2) (c) and par. (bm) 2., if the
10commission has determined that a customer of an energy utility is a large energy
11customer under
2005 Wisconsin Act 141, section
102 (8) (b), then, each month, the
12energy utility shall collect from the customer, for recovery of amounts under par. (a)
131., the amount determined by the commission under
2005 Wisconsin Act 141, section
14102 (8) (c).
AB755, s. 13
15Section
13. 196.374 (5) (b) 2. of the statutes is amended to read:
AB755,9,2516
196.374
(5) (b) 2. A customer of an energy utility that the commission has not
17determined is a large energy customer under
2005 Wisconsin Act 141, section
102 (8)
18(b), may petition the commission for a determination that the customer is a large
19energy customer. The commission shall determine that a petitioner is a large energy
20customer if the petitioner satisfies the definition of large energy customer for any
21month in the 12 months preceding the date of the petition. If the commission makes
22such a determination, the commission shall also determine the amount that the
23energy utility may collect from the customer each month for recovery of the amounts
24under par. (a)
1. The commission shall determine an amount that ensures that the
25amount collected from the customer is similar to the amounts collected from other
1customers that have a similar level of energy costs as the customer. Except as
2provided in sub. (2) (c) and par. (bm) 2., each month, the energy utility shall collect
3from the customer, for recovery of amounts under par. (a)
1., the amount determined
4by the commission under this subdivision.
AB755, s. 14
5Section
14. 196.374 (5) (bm) 1. of the statutes is amended to read:
AB755,10,146
196.374
(5) (bm) 1. The commission shall commence a proceeding
for for
7creating a proposal for allocating within different classes of customers an equitable
8distribution of the recovery of the amounts under par. (a)
1. by all energy utilities.
9The purpose of the allocation is to ensure that customers of an energy utility within
10a particular class are treated equitably with respect to customers of other energy
11utilities within the same class. No later than December 31, 2008, the commission
12shall submit the proposal to the governor and chief clerk of each house of the
13legislature for distribution to the appropriate standing committees of the legislature
14under s. 13.172 (3).
AB755, s. 15
15Section
15. 196.374 (5m) (a) of the statutes is amended to read:
AB755,10,2316
196.374
(5m) (a) The commission shall ensure that, on an annual basis, each
17customer class of an energy utility has the opportunity to receive grants and benefits
18under energy efficiency programs in an amount equal to the amount that is recovered
19from the customer class under sub. (5) (a)
1. Biennially, the commission shall submit
20a report to the governor, and the chief clerk of each house of the legislature for
21distribution to the legislature under s. 13.172 (2), that summarizes the total amount
22recovered from each customer class and the total amount of grants made to, and
23benefits received by, each customer class.
AB755, s. 16
24Section
16. 196.3745 of the statutes is created to read:
AB755,11,2
1196.3745 Energy efficiency and renewable energy investment
2program. (1) Definitions. In this section:
AB755,11,53
(a) "Cultural competency" means the ability to understand and act respectfully
4toward, in a cultural context, the beliefs, interpersonal styles, attitudes, and
5behaviors of persons of various cultures.
AB755,11,86
(b) "Energy efficiency improvement" means an improvement to any type of
7premises that reduces the usage of energy, or increases the efficiency of energy usage,
8at the premises.
AB755,11,109
(c) "Improvement or application" means an energy efficiency improvement or
10renewable resource application.
AB755,11,1111
(d) "Political subdivision" means a city, village, town, or county.
AB755,11,1312
(e) "Political subdivision loan" means a loan under s. 66.0627 (8) for an
13improvement or application.
AB755,11,1514
(f) "Renewable resource application" means the application of a renewable
15resource, as defined in s. 196.374 (1) (j), at any type of premises.
AB755,11,1716
(g) "Utility" means a public utility that furnishes electricity, natural gas, or
17water service to retail customers.
AB755,11,23
18(2) Authorization. Subject to s. 196.374 (2) (b) 2m., the commission may, upon
19application by a utility, authorize the utility to administer, fund, or provide
20administrative services for a program for investing in improvements or applications
21for any type of premises served by the utility. Participation in such a program shall
22be at the discretion of utilities and premises owners, and the commission may not
23require that a utility or premises owner participate in such a program.
AB755,12,4
24(3) Tariffs. A utility for which a program is authorized under sub. (2) shall file
25a tariff specifying the terms and conditions of utility and nonutility service provided
1to customers at premises where improvements or applications are made under the
2program. A tariff filed under this subsection shall have no effect until approved by
3the commission. A tariff filed by a utility under this subsection shall include all of
4the following:
AB755,12,75
(a) Terms and conditions for billing customers at premises for utility and
6nonutility service related to improvements or applications for which investments are
7made.
AB755,12,118
(b) A contract between the utility and an owner of property benefited by an
9improvement or application that requires the owner to inform any property lessees
10who are liable for utility service that the cost of the improvement or application will
11appear on the lessees' utility bills.
AB755,12,1612
(c) A contract between the utility and an owner of property benefited by an
13improvement or application that requires the owner to inform any purchaser of the
14property that the purchaser, or any other person who is liable for utility service at
15the property, is liable for the unpaid cost of the improvement or application and that
16such unpaid cost will appear on utility bills for the property.
AB755,12,1717
(d) Any other term or condition required by the commission.
AB755,13,3
18(4) Audits. (a)
Preaudits. A premises is not eligible for an investment for an
19improvement or application under a program authorized under sub. (2) and a
20premises is not eligible for a political subdivision loan unless an audit is performed
21that demonstrates that the improvement or application is cost-effective. The
22commission shall promulgate rules for determining whether an improvement or
23application is cost-effective. For an improvement or application, the rules may
24specify criteria that include comparing the cost of the improvement or application to
25the value of the premises benefited by the improvement or application. For an
1improvement, the rules may specify criteria that include the energy savings
2resulting from the improvement and the period of time required for the energy
3savings to equal the cost of the improvement.
AB755,13,84
(b)
Postaudits. The commission shall promulgate rules requiring the
5performance of an audit after an improvement or application is made or installed
6under a program authorized under sub. (2) or pursuant to a political subdivision
7loan. The purpose of the audit shall be to verify that an improvement or application
8was made or installed.
AB755,13,119
(c)
Certifications. The commission shall promulgate rules specifying the
10certification requirements that a person must satisfy in order to perform an audit
11required under this subsection.
AB755,13,18
12(5) Contractors and subcontractors. (a) All work involved in making or
13installing an improvement or application under a program authorized under sub. (2)
14or pursuant to a political subdivision loan shall be performed by a contractor or
15subcontractor that the commission has included on a list of prequalified contractors
16and subcontractors. The commission shall approve a contractor or subcontractor for
17inclusion on the prequalification list only if the commission determines that the
18contractor or subcontractor satisfies all of the following:
AB755,14,719
1. Agrees to pay all employees working on an improvement or application for
20which an investment is made under the program, or for which the political
21subdivision loan is made, who would be entitled to receive the prevailing wage rate
22under s. 66.0903 and who would not be required or permitted to work more than the
23prevailing hours of labor, as defined in s. 103.49 (1) (c), if the improvement or
24application were a project of public works under s. 66.0903, not less than the
25prevailing wage rate determined under s. 66.0903 (3) or (6) and not to require or
1permit those employees to work more than the prevailing hours of labor, except as
2permitted under s. 66.0903 (4) (a); to keep and permit inspection of records in the
3same manner as a contractor performing work on a project of public works that is
4subject to s. 66.0903 is required to keep and permit inspection of records under s.
566.0903 (10); and otherwise to comply with s. 66.0903 in the same manner as a
6contractor performing work on a project of public works that is subject to s. 66.0903
7is required to comply with s. 66.0903.
AB755,14,188
2. Agrees not to permit an employee working on an improvement or application
9for which an investment is made under the program or for which the political
10subdivision loan is made to use, possess, attempt to possess, distribute, deliver, or
11be under the influence of a drug, as defined in s. 103.503 (1) (d), or use or be under
12the influence of alcohol, while performing that work, to have in place a written
13program for the prevention of substance abuse among those employees in the same
14manner as a contractor performing work on a project of public works that is subject
15to s. 66.0903 is required to have in place such a written program under s. 103.503 (3),
16and otherwise to comply with s. 103.503 in the same manner as a contractor
17performing work on a project of public works that is subject to s. 66.0903 is required
18to comply with s. 103.503.
AB755,14,2419
3. Except as provided in par. (b), agrees, if the contractor or subcontractor
20employs employees in trades that are apprenticeable under subch. I of ch. 106, to
21sponsor an apprenticeship training program that is approved by the department of
22workforce development for each of those trades and to employ in each of those trades
23the maximum ratio of apprentices to journeymen that are permitted under
24standards adopted, recognized, or approved by that department.