SB517: Bill Text

SB517,1,11 An Act to amend 196.374 (1); and to create 15.07 (1) (a) 7., 15.07 (1) (d), 15.792, 20.155 (1m), 25.17 (1) (kx), 25.96, 196.374 (4), 196.378 and 196.96 of the statutes; relating to: establishing programs for low-income energy assistance, improving energy conservation and efficiency markets and encouraging the development and use of renewable resources, creating a public benefits and energy assistance board, establishing a public benefits and energy assistance fund, requiring electric utilities and retail cooperatives to charge access fees to customers and members, imposing requirements on the use of renewable resources by electric and gas utilities and cooperatives, requiring the exercise of rule-making authority, making appropriations and providing a penalty.

Analysis by the Legislative Reference Bureau

This bill creates a public benefits and energy assistance board (board), which is required to establish and administer programs for providing energy assistance to low-income households and conservation and efficiency services to eligible recipients and for encouraging the development and use of renewable energy resources. The bill also imposes certain requirements on the generation of electricity from renewable energy resources by public utilities and retail cooperative associations.

Public benefits and energy assistance board

The board, which is attached to the public service commission (PSC), is required to establish programs for each of the following: 1) assisting low-income households with weatherization and energy conservation services and payment of energy bills (low-income assistance programs); 2) providing energy conservation and efficiency services to eligible recipients (conservation programs); and 3) encouraging the development and use of renewable energy resources (renewables programs). The board must hold a hearing before establishing the programs. Interested persons, including members of the public, may intervene in a hearing and, under certain circumstances, receive compensation from the PSC for the reasonable costs of intervention.

The bill requires the division of housing in DOA to contract with certain nonprofit or governmental entities for the administration of the low-income assistance programs. The board may contract with the same types of entities for the administration of the conservation and renewables programs. Under the low-income assistance programs, in each fiscal year, no less than the difference between $50,000,000 and the amount of funding received by the state under certain federal low-income assistance and weatherization programs (federal programs) must be used for purposes other than paying energy bills. The bill also specifies the minimum amounts that must be used for certain purposes under the conservation and renewables programs.

The programs established by the board are funded by an access fee that the board collects from nonmunicipal electric public utilities, which must charge the access fees to their customers. Municipal electric public utilities and retail electric cooperatives (municipal utilities and cooperatives) are also required to charge an access fee to their customers or members. Every 3 years, a municipal utility or cooperative may elect to contribute all or a specified portion of the access fees to the board for the programs established by the board. A municipal utility or cooperative that does not elect to contribute all of the access fees to the board must spend specified portions of the access fees on its own "commitment to community programs", which are defined as low-income assistance programs, energy conservation programs and programs for promoting the welfare of communities that include the municipal utility's or cooperative's customers or members.

The bill directs the board to determine the amount of an access fee that must be charged by nonmunicipal public utilities, municipal utilities and cooperatives. Each municipal utility and cooperative must charge an access fee that is sufficient for the utility or cooperative to collect an annual average of $13.16 per meter for each customer or member. However, for the period ending on June 30, 2008, the amount of the access fee paid by an individual customer or member may not exceed 3% of the total of every other charge that is billed to the customer or member during that period.

For nonmunicipal utilities, the board must determine the amount of the access fee as follows. In fiscal year 1998-99, a portion of the access fee must be in an amount that is sufficient for the board to collect from the nonmunicipal electric utilities the amount that results from subtracting the sum of the following from $105,000,000: 1) the amount received by the state under the federal programs; and 2) 50% of the access fees charged by municipal utilities and cooperatives. For fiscal years after 1998-99, the amount is determined by subtracting the same amounts from an amount of low-income need that is determined by the board. The remaining portion of the access fee must be sufficient for the board to collect from nonmunicipal utilities the amount that results from subtracting the sum of the following from $112,000,000: 1) the amount of funding received under the federal programs; and 2) 20% of the access fees charged by municipal utilities and cooperatives. After fiscal year 2000-01, the board may reduce the amount that must be collected from the remaining portion of the access fee if the board discontinues or reduces any of the conservation or renewables programs. The total access fee paid by a customer of a nonmunicipal utility is subject to the same 3% limit that applies to an access fee paid by a customer or member of a municipal utility or cooperative.

The bill also requires certain electric utilities to spend a portion of the access fees on energy conservation programs, rather than paying the entire amount to the board. Under current law, certain electric utilities are required to spend at least 0.5% of their annual operating revenues on energy conservation programs. The bill requires instead that, through fiscal year 2001-02, such electric utilities must spend a specified portion of the access fees on energy conservation programs. After fiscal year 2001-02, the electric utilities are not required to spend a portion of the access fees on energy conservation programs, but must pay the entire amount to the board.

The bill imposes other requirements on the board's programs and the commitment to community programs, including the following:

1. The bill requires public utilities to allow electric customers to make contributions to the board's programs or the commitment to community programs.

2. For purposes of determining whether a municipal utility or cooperative has spent a required amount on a commitment to community program, the bill allows a municipal utility or cooperative to receive credit for any spending by its wholesale electric supplier on the supplier's own commitment to community programs.

3. The bill imposes certain reporting requirements on municipal utilities and cooperatives that spend access fees on commitment to community programs.

Renewable energy resources

Under this bill, a certain percentage of the electricity generated by a public utility or retail cooperative association must be generated from renewable energy resources. The percentage is calculated on the basis of a public utility's or retail cooperative association's "system peak load share", which is defined as the amount of electricity that the public utility or retail cooperative association delivered to its customers or members at that time during the summer of 1996 that the maximum amount of electricity was delivered to all customers and members of all public utilities and retail cooperative associations. The following percentages of a public utility's or retail cooperative association's system peak load share must be generated from renewable resources: 1% by December 31, 2000; 1.5% by December 31, 2002; 2% by December 31, 2004; 2.5% by December 31, 2006; 3% by December 31, 2008; and 4% by December 31, 2010.

The bill allows a municipal public utility or retail cooperative association to receive a credit for the amount of electricity generated from renewable resources by its wholesale supplier. In addition, the bill allows public utilities and retail cooperative associations to purchase credits from other public utilities and retail cooperative associations that generate electricity from renewable resources in excess of the required percentages of system peak load share. A public utility or retail cooperative association that purchases such a credit may use the credit for purposes of determining whether it satisfies a required percentage. The PSC must promulgate rules establishing requirements and procedures for sales of such credits.

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:

SB517, s. 1 Section 1. 15.07 (1) (a) 7. of the statutes is created to read:

SB517,4,4 15.07 (1) (a) 7. Members of the public benefits and energy assistance board appointed under s. 15.792 (1) (b) or (c) shall be appointed as provided in s. 15.792 (1) (b) or (c) without senate confirmation.

SB517, s. 2 Section 2. 15.07 (1) (d) of the statutes is created to read:

SB517,4,8 15.07 (1) (d) Except as provided in s. 15.792 (1) (b) 5. or 8. or (c), no member appointed to the public benefits and energy assistance board may be an employe of a utility, as defined in 196.374 (1).

SB517, s. 3 Section 3. 15.792 of the statutes is created to read:

SB517,4,11 15.792 Same; attached board. Public benefits and energy assistance board. (1) (a) In this subsection:

SB517,4,12 1. "Electric utility" has the meaning given in s. 196.96 (1) (f).

SB517,4,13 2. "Low-income household" has the meaning given in s. 196.96 (1) (L).

SB517,4,14 3. "Municipal utility" has the meaning given in s. 196.96 (1) (p).

SB517,5,1 4. "Renewable resource" has the meaning given in s. 196.378 (1) (g).

SB517,5,2 5. "Retail cooperative" has the meaning given in s. 196.96 (1) (r).

SB517,5,3 6. "Small business" has the meaning given in s. 16.75 (4) (c).

SB517,5,5 7. "Small business representative" means a director, manager, member, officer, owner or partner of a small business.

SB517,5,8 (b) There is created a public benefits and energy assistance board that is attached to the public service commission under s. 15.03. The board shall consist of the following members appointed for 3-year terms:

SB517,5,10 1. One member appointed by the governor who is a member of a low-income household or who represents a low-income household advocacy group.

SB517,5,13 2. One member appointed by the president of the senate who is a residential electric utility customer or who represents a residential electric utility customer advocacy group.

SB517,5,15 3. One member appointed by the governor who is a small business representative or who represents a small business advocacy group.

SB517,5,17 4. One member appointed by the president of the senate who represents an environmental or renewable resource advocacy group.

SB517,5,20 5. One member appointed by the president of the senate who represents of a municipal utility or retail cooperative or municipal utility or retail cooperative advocacy group.

SB517,5,22 6. One member appointed by the speaker of the assembly who is a member of a low-income household or who represents a low-income household advocacy group.

SB517,5,24 7. One member appointed by the speaker of the assembly who represents an environmental or renewable resource advocacy group.

SB517,6,2 8. One member appointed by the speaker of the assembly who represents an electric utility or electric utility advocacy group.

SB517,6,4 9. One member appointed by the chairperson of the public service commission to represent the public service commission.

SB517,6,6 10. One member appointed by the secretary of natural resources to represent the department of natural resources.

SB517,6,8 11. One member appointed by the administrator of the division of housing in the department of administration to represent the division of housing.

SB517,6,17 (c) 1. a. Notwithstanding par. (b) (intro.) and 5., if fewer than one-third of the municipal utilities and retail cooperatives doing business in this state notify the board under s. 196.96 (5) (b) 1. that they have elected not to contribute to any of the programs established under s. 196.96 (2) (a) or (b), the president of the senate shall appoint a representative of an electric utility or electric utility advocacy group to succeed the member appointed under par. (b) 5. and the member appointed under par. (b) 5. shall vacate his or her membership at the time that the member is appointed under this subd. 1. a. A member appointed under this subd. 1. a. shall serve on the board until a member is appointed under subd. 2.

SB517,6,23 b. If one-third or more of the municipal utilities and retail cooperatives doing business in this state notify the board under s. 196.96 (5) (b) 1. that they have elected to contribute to any of the programs established under s. 196.96 (2) (a) or (b), the member appointed under par. (b) 5. shall serve for a term expiring on the first day of the 48th month beginning after the effective date of this subd. 1. b. .... [revisor inserts date].

SB517,7,4 2. a. If one-third or more of the municipal utilities and retail cooperatives doing business in this state notify the board under s. 196.96 (5) (b) 2. that they have elected to contribute to any of the programs established under s. 196.96 (2) (a) or (b), the president of the senate shall appoint one member to the board who is a representative of a municipal utility or retail cooperative or municipal utility or retail cooperative advocacy group for a 3-year term.

SB517,7,10 b. Notwithstanding par. (b) (intro.) or 5., if fewer than one-third of the municipal utilities and retail cooperatives doing business in this state notify the board under s. 196.96 (5) (b) 2. that they have elected not to contribute to any of the programs established under s. 196.96 (2) (a) or (b), the president of the senate shall appoint a member to the board who is a representative of an electric utility or electric utility advocacy group for a 3-year term.

SB517, s. 4 Section 4. 20.005 (3) (schedule) of the statutes: at the appropriate place, insert the following amounts for the purposes indicated: - See PDF for table

SB517, s. 5 Section 5. 20.155 (1m) of the statutes is created to read:

SB517,7,17 20.155 (1m) Public benefits and energy assistance board. (q) General program operations. From the public benefits and energy assistance fund, a sum sufficient for general program operations of the public benefits and energy assistance board.

SB517,7,20 (r) Grants. From the public benefits and energy assistance fund, a sum sufficient for low-income assistance grants under s. 196.96 (2) (a) and energy conservation and efficiency and renewable resource grants under s. 196.96 (2) (b).

SB517,8,3 (s) Compensation of intervenors. From the public benefits and energy assistance fund, the amounts in the schedule for compensating persons who intervene in hearings under the rules promulgated under s. 196.96 (2) (e) 3.

SB517, s. 6 Section 6. 25.17 (1) (kx) of the statutes is created to read:

SB517,8,5 25.17 (1) (kx) Public benefits and energy assistance fund (s. 25.96);

SB517, s. 7 Section 7. 25.96 of the statutes is created to read:

SB517,8,10 25.96 Public benefits and energy assistance fund. There is established a separate nonlapsible trust fund designated as the public benefits and energy assistance fund, consisting of the access fees received under s. 196.96 (4) (a) and (5) (c) and (d) and contributions received under s. 196.96 (2) (f) and (g).

SB517, s. 8 Section 8. 196.374 (1) of the statutes is amended to read:

SB517,8,19 196.374 (1) In this section, "utility" means a class A gas or electric utility, as defined by the commission. Every utility shall spend annually at least 0.5% of its total annual operating revenues the amount specified in s. 196.96 (4) (d) 1. on programs designed to promote and accomplish energy conservation. The commission may require a utility to spend annually, for the purpose of promoting and accomplishing energy conservation, an amount which is more or less than 0.5% of its annual operating revenues if, after notice and hearing, the commission finds that the expenditure of such amount is in the public interest.

SB517, s. 9 Section 9. 196.374 (4) of the statutes is created to read:

SB517,8,21 196.374 (4) This section does not apply after June 30, 2002.

SB517, s. 10 Section 10. 196.378 of the statutes is created to read:

SB517,8,23 196.378 Renewable resources. (1) Definitions. In this section:

SB517,9,2 (a) "Biomass" means a resource that generates energy from wood or plant material or residue, biological waste, crops grown for use as a resource or landfill gases. "Biomass" does not include garbage, as defined in s. 289.01 (9), or industrial, commercial or household waste.

SB517,9,4 (b) "Capacity" means the amount of electricity that an electric or gas provider is capable of delivering to its customers or members at a specified time.

SB517,9,6 (c) "Conventional resource" means a resource that generates energy from coal, oil, nuclear power or natural gas, except for natural gas used in a fuel cell.

SB517,9,8 (d) "Electric or gas provider" means an electric or gas utility or retail cooperative.

SB517,9,10 (e) "Electric or gas utility" means a public utility that generates, transmits, delivers or furnishes electricity or gas.

SB517,9,12 (f) "Municipal utility" means an electric or gas utility that is owned or operated wholly by a municipality.

SB517,9,13 (g) "Renewable resource" means any of the following:

SB517,9,14 1. A resource that generates energy from any of the following:

SB517,9,15 a. A fuel cell that uses, as determined by the commission, a renewable fuel.

SB517,9,16 b. Tidal action.

SB517,9,17 c. Solar photovoltaic energy.

SB517,9,18 d. Wind power.

SB517,9,19 e. Geothermal technology.

SB517,9,20 f. Hydroelectric power.

SB517,9,21 g. Biomass.

SB517,9,23 2. Any other resource, except a conventional resource, that the commission designates as a renewable resource in rules promulgated under sub. (4).

SB517,10,3 (h) "Renewable resource credit" means a percentage by which an electric or gas provider's renewable resource percentage exceeds a percentage of the electric or gas provider's system peak load share specified in sub. (2) (a) 1. to 6.

SB517,10,5 (i) "Renewable resource percentage" means the percentage of an electric or gas provider's capacity that is generated from renewable resources.

SB517,10,6 (j) "Resource" means a source of electric power generation.

SB517,10,8 (k) "Retail cooperative" means a cooperative association organized under ch. 185 for the purpose of providing electricity or gas at retail to its members only.

SB517,10,11 (L) "System peak load" means the maximum amount of electricity that was delivered to all customers or members of all electric or gas providers at any one time during the period from May 1, 1996, to September 15, 1996.

SB517,10,15 (m) "System peak load share" means the amount of electricity that was delivered to all customers or members of an electric or gas provider by the electric or gas provider at the time that the system peak load was delivered to all customers or members of all electric or gas providers.

SB517,10,18 (2) Renewable resource percentages. (a) The renewable resource percentage of an electric or gas provider, as calculated under par. (b), shall be at least the following percentages of the electric or gas provider's system peak load share:

SB517,10,19 1. By December 31, 2000, 1%.