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[Status][Bill Documents][Fiscal Note][Bills Directory]

S.B. 76

             1     

ENERGY AMENDMENTS

             2     
2009 GENERAL SESSION

             3     
STATE OF UTAH

             4     
Chief Sponsor: Curtis S. Bramble

             5     
House Sponsor: ____________

             6     
             7      LONG TITLE
             8      General Description:
             9          This bill amends definitions and energy provisions in Title 54, Public Utilities.
             10      Highlighted Provisions:
             11          This bill:
             12          .    amends definitions; and
             13          .    makes technical corrections.
             14      Monies Appropriated in this Bill:
             15          None
             16      Other Special Clauses:
             17          None
             18      Utah Code Sections Affected:
             19      AMENDS:
             20          54-2-1, as last amended by Laws of Utah 2008, Chapter 374
             21          54-12-1, as last amended by Laws of Utah 2008, Chapter 374
             22          54-12-2, as last amended by Laws of Utah 2008, Chapter 374
             23          54-17-102, as last amended by Laws of Utah 2008, Chapter 382
             24          54-17-201, as last amended by Laws of Utah 2008, Chapters 374 and 382
             25          54-17-601, as enacted by Laws of Utah 2008, Chapter 374
             26     
             27      Be it enacted by the Legislature of the state of Utah:


             28          Section 1. Section 54-2-1 is amended to read:
             29           54-2-1. Definitions.
             30          As used in this title:
             31          (1) "Avoided costs" means the incremental costs to an electrical corporation of electric
             32      energy or capacity or both which, due to the purchase of electric energy or capacity or both
             33      from [small] qualifying power production or cogeneration facilities, the electrical corporation
             34      would not have to generate itself or purchase from another electrical corporation.
             35          (2) "Cogeneration facility":
             36          (a) means a generation facility which produces:
             37          (i) electric energy; and
             38          (ii) steam or forms of useful energy, including heat, which are used for industrial,
             39      commercial, heating, or cooling purposes; and
             40          (b) is a qualifying cogeneration facility under federal law.
             41          (3) "Commission" means the Public Service Commission of Utah.
             42          (4) "Commissioner" means a member of the commission.
             43          (5) (a) "Corporation" includes an association, and a joint stock company having any
             44      powers or privileges not possessed by individuals or partnerships.
             45          (b) "Corporation" does not include towns, cities, counties, conservancy districts,
             46      improvement districts, or other governmental units created or organized under any general or
             47      special law of this state.
             48          (6) "Distribution electrical cooperative" includes an electrical corporation that:
             49          (a) is a cooperative;
             50          (b) conducts a business that includes the retail distribution of electricity the cooperative
             51      purchases or generates for the cooperative's members; and
             52          (c) is required to allocate or distribute savings in excess of additions to reserves and
             53      surplus on the basis of patronage to the cooperative's:
             54          (i) members; or
             55          (ii) patrons.
             56          (7) "Electrical corporation" includes every corporation, cooperative association, and
             57      person, their lessees, trustees, and receivers, owning, controlling, operating, or managing any
             58      electric plant, or in any way furnishing electric power for public service or to its consumers or


             59      members for domestic, commercial, or industrial use, within this state, except independent
             60      energy producers, and except where electricity is generated on or distributed by the producer
             61      solely for the producer's own use, or the use of the producer's tenants, or for the use of
             62      members of an association of unit owners formed under Title 57, Chapter 8, Condominium
             63      Ownership Act, and not for sale to the public generally.
             64          (8) "Electric plant" includes all real estate, fixtures, and personal property owned,
             65      controlled, operated, or managed in connection with or to facilitate the production, generation,
             66      transmission, delivery, or furnishing of electricity for light, heat, or power, and all conduits,
             67      ducts, or other devices, materials, apparatus, or property for containing, holding, or carrying
             68      conductors used or to be used for the transmission of electricity for light, heat, or power.
             69          (9) "Generation facility" means all electric plant used for the production or generation
             70      of electricity, including all electric plant used to interconnect the production or generation
             71      plant.
             72          [(9)] (10) "Gas corporation" includes every corporation and person, their lessees,
             73      trustees, and receivers, owning, controlling, operating, or managing any gas plant for public
             74      service within this state or for the selling or furnishing of natural gas to any consumer or
             75      consumers within the state for domestic, commercial, or industrial use, except in the situation
             76      that:
             77          (a) gas is made or produced on, and distributed by the maker or producer through,
             78      private property:
             79          (i) solely for the maker's or producer's own use or the use of the maker's or producer's
             80      tenants; and
             81          (ii) not for sale to others;
             82          (b) gas is compressed on private property solely for the owner's own use or the use of
             83      the owner's employees as a motor vehicle fuel; or
             84          (c) gas is compressed by a retailer of motor vehicle fuel on the retailer's property solely
             85      for sale as a motor vehicle fuel.
             86          [(10)] (11) "Gas plant" includes all real estate, fixtures, and personal property owned,
             87      controlled, operated, or managed in connection with or to facilitate the production, generation,
             88      transmission, delivery, or furnishing of gas, natural or manufactured, for light, heat, or power.
             89          [(11)] (12) "Heat corporation" includes every corporation and person, their lessees,


             90      trustees, and receivers, owning, controlling, operating, or managing any heating plant for public
             91      service within this state.
             92          [(12)] (13) (a) "Heating plant" includes all real estate, fixtures, machinery, appliances,
             93      and personal property controlled, operated, or managed in connection with or to facilitate the
             94      production, generation, transmission, delivery, or furnishing of artificial heat.
             95          (b) "Heating plant" does not include [either small] an independent power production
             96      facility, a qualifying power production [facilities] facility, or a cogeneration [facilities] facility.
             97          [(13)] (14) "Independent energy producer" means every electrical corporation, person,
             98      corporation, or government entity, their lessees, trustees, or receivers, that own, operate,
             99      control, or manage an independent power production or cogeneration facility.
             100          [(14)] (15) "Independent power production facility" means a generation facility that:
             101          (a) produces electric energy solely by the use, as a primary energy source, of biomass,
             102      waste, a renewable resource, a geothermal resource, or any combination of the preceding
             103      sources; or
             104          (b) is a qualifying power production facility.
             105          [(15)] (16) "Private telecommunications system" includes all facilities for the
             106      transmission of signs, signals, writing, images, sounds, messages, data, or other information of
             107      any nature by wire, radio, lightwaves, or other electromagnetic means, excluding mobile radio
             108      facilities, that are owned, controlled, operated, or managed by a corporation or person,
             109      including their lessees, trustees, receivers, or trustees appointed by any court, for the use of that
             110      corporation or person and not for the shared use with or resale to any other corporation or
             111      person on a regular basis.
             112          [(16)] (17) (a) "Public utility" includes every railroad corporation, gas corporation,
             113      electrical corporation, distribution electrical cooperative, wholesale electrical cooperative,
             114      telephone corporation, telegraph corporation, water corporation, sewerage corporation, heat
             115      corporation, and independent energy producer not described in Subsection [(16)] (17)(d),
             116      where the service is performed for, or the commodity delivered to, the public generally, or in
             117      the case of a gas corporation or electrical corporation where the gas or electricity is sold or
             118      furnished to any member or consumers within the state for domestic, commercial, or industrial
             119      use.
             120          (b) (i) If any railroad corporation, gas corporation, electrical corporation, telephone


             121      corporation, telegraph corporation, water corporation, sewerage corporation, heat corporation,
             122      or independent energy producer not described in Subsection [(16)] (17)(d), performs a service
             123      for or delivers a commodity to the public, it is considered to be a public utility, subject to the
             124      jurisdiction and regulation of the commission and this title.
             125          (ii) If a gas corporation, independent energy producer not described in Subsection
             126      [(16)] (17)(d), or electrical corporation sells or furnishes gas or electricity to any member or
             127      consumers within the state, for domestic, commercial, or industrial use, for which any
             128      compensation or payment is received, it is considered to be a public utility, subject to the
             129      jurisdiction and regulation of the commission and this title.
             130          (c) Any corporation or person not engaged in business exclusively as a public utility as
             131      defined in this section is governed by this title in respect only to the public utility owned,
             132      controlled, operated, or managed by the corporation or person, and not in respect to any other
             133      business or pursuit.
             134          (d) An independent energy producer is exempt from the jurisdiction and regulations of
             135      the commission with respect to an independent power production facility if it meets the
             136      requirements of this Subsection [(16)] (17)(d)[(i), (ii), or (iii)], or any combination of these:
             137          (i) the commodity or service is produced or delivered, or both, by an independent
             138      energy producer solely for the uses exempted in Subsection (7) or for the use of state-owned
             139      facilities;
             140          (ii) the commodity or service is sold by an independent energy producer solely to an
             141      electrical corporation or other wholesale purchaser; or
             142          (iii) (A) the commodity or service delivered by the independent energy producer is
             143      delivered to an entity which controls, is controlled by, or affiliated with the independent energy
             144      producer or to a user located on real property managed by the independent energy producer;
             145      and
             146          (B) the real property on which the service or commodity is used is contiguous to real
             147      property which is owned or controlled by the independent energy producer. Parcels of real
             148      property separated solely by public roads or easements for public roads shall be considered as
             149      contiguous for purposes of this Subsection [(16)] (17).
             150          (e) Any person or corporation defined as an electrical corporation or public utility
             151      under this section may continue to serve its existing customers subject to any order or future


             152      determination of the commission in reference to the right to serve those customers.
             153          (f) (i) "Public utility" does not include any person that is otherwise considered a public
             154      utility under this Subsection [(16)] (17) solely because of that person's ownership of an interest
             155      in an electric plant, cogeneration facility, independent power production facility, or [small]
             156      qualifying power production facility in this state if all of the following conditions are met:
             157          (A) the ownership interest in the electric plant, cogeneration facility, independent
             158      power production facility, or qualifying or [small] power production facility is leased to:
             159          (I) a public utility, and that lease has been approved by the commission;
             160          (II) a person or government entity that is exempt from commission regulation as a
             161      public utility; or
             162          (III) a combination of Subsections [(16)] (17)(f)(i)(A)(I) and (II);
             163          (B) the lessor of the ownership interest identified in Subsection [(16)] (17)(f)(i)(A) is:
             164          (I) primarily engaged in a business other than the business of a public utility; or
             165          (II) a person whose total equity or beneficial ownership is held directly or indirectly by
             166      another person engaged in a business other than the business of a public utility; and
             167          (C) the rent reserved under the lease does not include any amount based on or
             168      determined by revenues or income of the lessee.
             169          (ii) Any person that is exempt from classification as a public utility under Subsection
             170      [(16)] (17)(f)(i) shall continue to be so exempt from classification following termination of the
             171      lessee's right to possession or use of the electric plant for so long as the former lessor does not
             172      operate the electric plant or sell electricity from the electric plant. If the former lessor operates
             173      the electric plant or sells electricity, the former lessor shall continue to be so exempt for a
             174      period of 90 days following termination, or for a longer period that is ordered by the
             175      commission. This period may not exceed one year. A change in rates that would otherwise
             176      require commission approval may not be effective during the 90-day or extended period
             177      without commission approval.
             178          (g) "Public utility" does not include any person that provides financing for, but has no
             179      ownership interest in an electric plant, [small] qualifying power production facility,
             180      independent power production facility, or cogeneration facility. In the event of a foreclosure in
             181      which an ownership interest in an electric plant, [small] qualifying power production facility,
             182      independent power production facility, or cogeneration facility is transferred to a third-party


             183      financer of an electric plant, [small] qualifying power production facility, independent power
             184      production facility, or cogeneration facility, then that third-party financer is exempt from
             185      classification as a public utility for 90 days following the foreclosure, or for a longer period that
             186      is ordered by the commission. This period may not exceed one year.
             187          (h) (i) The distribution or transportation of natural gas for use as a motor vehicle fuel
             188      does not cause the distributor or transporter to be a "public utility," unless the commission,
             189      after notice and a public hearing, determines by rule that it is in the public interest to regulate
             190      the distributers or transporters, but the retail sale alone of compressed natural gas as a motor
             191      vehicle fuel may not cause the seller to be a "public utility."
             192          (ii) In determining whether it is in the public interest to regulate the distributors or
             193      transporters, the commission shall consider, among other things, the impact of the regulation
             194      on the availability and price of natural gas for use as a motor fuel.
             195          [(17)] (18) "Purchasing utility" means any electrical corporation that is required to
             196      purchase electricity from [small] qualifying power production or cogeneration facilities
             197      pursuant to the Public Utility Regulatory Policies Act, 16 U.S.C. Section 824a-3.
             198          [(18)] (19) "Qualifying power producer" means a corporation, cooperative association,
             199      or person, or the lessee, trustee, and receiver of the corporation, cooperative association, or
             200      person, who owns, controls, operates, or manages any qualifying power production facility or
             201      cogeneration facility.
             202          [(19)] (20) "Qualifying power production facility" means a generation facility that:
             203          (a) produces electrical energy solely by the use, as a primary energy source, of biomass,
             204      waste, a renewable resource, a geothermal resource, or any combination of the preceding
             205      sources;
             206          (b) has a power production capacity that, together with any other facilities located at
             207      the same site, is no greater than 80 megawatts; and
             208          (c) is a qualifying small power production facility under federal law.
             209          [(20)] (21) "Railroad" includes every commercial, interurban, and other railway, other
             210      than a street railway, and each branch or extension of a railway, by any power operated,
             211      together with all tracks, bridges, trestles, rights-of-way, subways, tunnels, stations, depots,
             212      union depots, yards, grounds, terminals, terminal facilities, structures, and equipment, and all
             213      other real estate, fixtures, and personal property of every kind used in connection with a


             214      railway owned, controlled, operated, or managed for public service in the transportation of
             215      persons or property.
             216          [(21)] (22) "Railroad corporation" includes every corporation and person, their lessees,
             217      trustees, and receivers, owning, controlling, operating, or managing any railroad for public
             218      service within this state.
             219          [(22)] (23) (a) "Sewerage corporation" includes every corporation and person, their
             220      lessees, trustees, and receivers, owning, controlling, operating, or managing any sewerage
             221      system for public service within this state.
             222          (b) "Sewerage corporation" does not include private sewerage companies engaged in
             223      disposing of sewage only for their stockholders, or towns, cities, counties, conservancy
             224      districts, improvement districts, or other governmental units created or organized under any
             225      general or special law of this state.
             226          [(23)] (24) "Telegraph corporation" includes every corporation and person, their
             227      lessees, trustees, and receivers, owning, controlling, operating, or managing any telegraph line
             228      for public service within this state.
             229          [(24)] (25) "Telegraph line" includes all conduits, ducts, poles, wires, cables,
             230      instruments, and appliances, and all other real estate, fixtures, and personal property owned,
             231      controlled, operated, or managed in connection with or to facilitate communication by
             232      telegraph, whether that communication be had with or without the use of transmission wires.
             233          [(25)] (26) (a) "Telephone corporation" means any corporation or person, and their
             234      lessees, trustee, receivers, or trustees appointed by any court, who owns, controls, operates,
             235      manages, or resells a public telecommunications service as defined in Section 54-8b-2 .
             236          (b) "Telephone corporation" does not mean a corporation, partnership, or firm
             237      providing:
             238          (i) intrastate telephone service offered by a provider of cellular, personal
             239      communication systems (PCS), or other commercial mobile radio service as defined in 47
             240      U.S.C. Sec. 332 that has been issued a covering license by the Federal Communications
             241      Commission;
             242          (ii) Internet service; or
             243          (iii) resold intrastate toll service.
             244          [(26)] (27) "Telephone line" includes all conduits, ducts, poles, wires, cables,


             245      instruments, and appliances, and all other real estate, fixtures, and personal property owned,
             246      controlled, operated, or managed in connection with or to facilitate communication by
             247      telephone whether that communication is had with or without the use of transmission wires.
             248          [(27)] (28) "Transportation of persons" includes every service in connection with or
             249      incidental to the safety, comfort, or convenience of the person transported, and the receipt,
             250      carriage, and delivery of that person and that person's baggage.
             251          [(28)] (29) "Transportation of property" includes every service in connection with or
             252      incidental to the transportation of property, including in particular its receipt, delivery,
             253      elevation, transfer, switching, carriage, ventilation, refrigeration, icing, dunnage, storage, and
             254      hauling, and the transmission of credit by express companies.
             255          [(29)] (30) "Water corporation" includes every corporation and person, their lessees,
             256      trustees, and receivers, owning, controlling, operating, or managing any water system for
             257      public service within this state. It does not include private irrigation companies engaged in
             258      distributing water only to their stockholders, or towns, cities, counties, water conservancy
             259      districts, improvement districts, or other governmental units created or organized under any
             260      general or special law of this state.
             261          [(30)] (31) (a) "Water system" includes all reservoirs, tunnels, shafts, dams, dikes,
             262      headgates, pipes, flumes, canals, structures, and appliances, and all other real estate, fixtures,
             263      and personal property owned, controlled, operated, or managed in connection with or to
             264      facilitate the diversion, development, storage, supply, distribution, sale, furnishing, carriage,
             265      appointment, apportionment, or measurement of water for power, fire protection, irrigation,
             266      reclamation, or manufacturing, or for municipal, domestic, or other beneficial use.
             267          (b) "Water system" does not include private irrigation companies engaged in
             268      distributing water only to their stockholders.
             269          [(31)] (32) "Wholesale electrical cooperative" includes every electrical corporation that
             270      is:
             271          (a) in the business of the wholesale distribution of electricity it has purchased or
             272      generated to its members and the public; and
             273          (b) required to distribute or allocate savings in excess of additions to reserves and
             274      surplus to members or patrons on the basis of patronage.
             275          Section 2. Section 54-12-1 is amended to read:


             276           54-12-1. Legislative policy.
             277          (1) The Legislature declares that in order to promote the more rapid development of
             278      new sources of electrical energy, to maintain the economic vitality of the state through the
             279      continuing production of goods and the employment of its people, and to promote the efficient
             280      utilization and distribution of energy, it is desirable and necessary to encourage independent
             281      energy and qualifying power producers to competitively develop sources of electric energy not
             282      otherwise available to Utah businesses, residences, and industries served by electrical
             283      corporations, and to remove unnecessary barriers to energy transactions involving independent
             284      energy and qualifying power producers and electrical corporations.
             285          (2) It is the policy of this state to encourage the development of independent and
             286      qualifying power production and cogeneration facilities, to promote a diverse array of
             287      economical and permanently sustainable energy resources in an environmentally acceptable
             288      manner, and to conserve our finite and expensive energy resources and provide for their most
             289      efficient and economic utilization.
             290          Section 3. Section 54-12-2 is amended to read:
             291           54-12-2. Purchase of power from qualifying power producers.
             292          (1) Purchasing utilities shall offer to purchase power from qualifying power producers.
             293          (2) The commission shall establish reasonable rates, terms, and conditions for the
             294      purchase or sale of electricity or electrical generating capacity, or both, between a purchasing
             295      utility and a qualifying power producer. In establishing these rates, terms, and conditions, the
             296      commission shall either establish a procedure under which qualifying power producers offer
             297      competitive bids for the sale of power to purchasing utilities or devise an alternative method
             298      which considers the purchasing utility's avoided costs. The capacity component of avoided
             299      costs shall reflect the purchasing utility's long-term deferral or cancellation of generating units
             300      which may result from the purchase of power from qualifying power producers.
             301          (3) Purchasing utilities and qualifying power producers may agree to rates, terms, or
             302      conditions for the sale of electricity or electrical capacity which differ from the rates, terms,
             303      and conditions adopted by the commission under Subsection (2).
             304          (4) The commission may adopt further rules which encourage the development of
             305      [small] qualifying power production and cogeneration facilities.
             306          Section 4. Section 54-17-102 is amended to read:


             307           54-17-102. Definitions.
             308          As used in this chapter:
             309          (1) "Affected electrical utility" means an electrical corporation with at least 200,000
             310      retail customers in the state.
             311          (2) "Benchmark option" means an energy resource against which bids in an open bid
             312      process may be evaluated that:
             313          (a) could be constructed or owned by:
             314          (i) an affected electrical utility; or
             315          (ii) an affiliate of an affected electrical utility; or
             316          (b) may be a purchase of:
             317          (i) electricity;
             318          (ii) electric generating capacity; or
             319          (iii) electricity and electric generating capacity.
             320          (3) "Integrated resource plan" means a plan that contains:
             321          (a) the demand and energy forecast by the affected electrical utility for at least a
             322      ten-year period;
             323          (b) the affected electrical utility's options for meeting the requirements shown in its
             324      load and resource forecast in an economic and reliable manner, including:
             325          (i) demand-side and supply-side options; and
             326          (ii) a brief description and summary cost-benefit analysis, if available, of each option
             327      that was considered;
             328          (c) the affected electrical utility's assumptions and conclusions with respect to the
             329      effect of the plan on the cost and reliability of energy service;
             330          (d) a description of the external environmental and economic consequences of the plan
             331      to the extent practicable; and
             332          (e) any other data and analyses as the commission may require.
             333          (4) "Significant energy resource" for an affected electrical utility means a resource that
             334      consists of:
             335          (a) a total of 100 megawatts or more of new generating capacity that has a dependable
             336      life of ten or more years;
             337          (b) a purchase of the following if the contract is for a term of ten or more years and not


             338      less than 100 megawatts:
             339          (i) electricity;
             340          (ii) electric generating capacity; or
             341          (iii) electricity and electrical generating capacity;
             342          (c) the purchase or lease by an affected electrical utility from an affiliated company of:
             343          (i) a [generating] generation facility;
             344          (ii) electricity;
             345          (iii) electrical generating capacity; or
             346          (iv) electricity and electrical generating capacity;
             347          (d) a contract with an option for the affected electrical utility or an affiliate to purchase
             348      a resource that consists of not less than 100 megawatts or more of new generating capacity that
             349      has a remaining dependable life of ten or more years; or
             350          (e) a type of resource designated by the commission as a significant energy resource in
             351      rules made by the commission in accordance with Title 63G, Chapter 3, Utah Administrative
             352      Rulemaking Act, after considering the affected electrical utility's integrated resource plan and
             353      action plan.
             354          (5) "Solicitation" means a request for proposals or other invitation for persons to
             355      submit a bid or proposal through an open bid process for construction or acquisition of a
             356      significant energy resource.
             357          Section 5. Section 54-17-201 is amended to read:
             358           54-17-201. Solicitation process required -- Exception.
             359          (1) (a) An affected electrical utility shall comply with this chapter to acquire or
             360      construct a significant energy resource after February 25, 2005.
             361          (b) Notwithstanding Subsection (1)(a), this chapter does not apply to a significant
             362      energy resource for which the affected electrical utility has issued a solicitation before February
             363      25, 2005.
             364          (2) (a) Except as provided in Subsection (3), to acquire or construct a significant
             365      energy resource, an affected electrical utility shall conduct a solicitation process that is
             366      approved by the commission.
             367          (b) To obtain the approval of the commission of a solicitation process, the affected
             368      electrical utility shall file with the commission a request for approval that includes:


             369          (i) a description of the solicitation process the affected electrical utility will use;
             370          (ii) a complete proposed solicitation; and
             371          (iii) any other information the commission requires by rule made in accordance with
             372      Title 63G, Chapter 3, Utah Administrative Rulemaking Act.
             373          (c) In ruling on the request for approval of a solicitation process, the commission shall
             374      determine whether the solicitation process:
             375          (i) complies with this chapter and rules made in accordance with Title 63G, Chapter 3,
             376      Utah Administrative Rulemaking Act; and
             377          (ii) is in the public interest taking into consideration:
             378          (A) whether it will most likely result in the acquisition, production, and delivery of
             379      electricity at the lowest reasonable cost to the retail customers of an affected electrical utility
             380      located in this state;
             381          (B) long-term and short-term impacts;
             382          (C) risk;
             383          (D) reliability;
             384          (E) financial impacts on the affected electrical utility; and
             385          (F) other factors determined by the commission to be relevant.
             386          (d) Before approving a solicitation process under this section the commission:
             387          (i) may hold a public hearing; and
             388          (ii) shall provide an opportunity for public comment.
             389          (e) As part of its review of a solicitation process, the commission may provide the
             390      affected electrical utility guidance on any additions or changes to its proposed solicitation
             391      process.
             392          (f) Unless the commission determines that additional time to analyze a solicitation
             393      process is warranted and is in the public interest, within 60 days of the day on which the
             394      affected electrical utility files a request for approval of the solicitation process, the commission
             395      shall:
             396          (i) approve a proposed solicitation process;
             397          (ii) suggest modifications to a proposed solicitation process; or
             398          (iii) reject a proposed solicitation process.
             399          (3) Notwithstanding Subsection (2), an affected electrical utility may acquire or


             400      construct a significant energy resource without conducting a solicitation process if it obtains a
             401      waiver of the solicitation requirement in accordance with Section 54-17-501 .
             402          (4) In accordance with the commission's authority under Subsection 54-12-2 (2), the
             403      commission shall determine:
             404          (a) whether this chapter or another competitive bidding procedure shall apply to a
             405      purchase of a significant energy resource by an affected electrical utility from a [small]
             406      qualifying power producer or cogenerator; and
             407          (b) if this chapter applies as provided in Subsection (4)(a), the manner in which this
             408      chapter applies to a purchase of a significant energy resource by an affected electrical utility
             409      from a [small] qualifying power producer or cogenerator.
             410          Section 6. Section 54-17-601 is amended to read:
             411           54-17-601. Definitions.
             412          As used in this part:
             413          (1) "Adjusted retail electric sales" means the total kilowatt-hours of retail electric sales
             414      of an electrical corporation to customers in this state in a calendar year, reduced by:
             415          (a) the amount of those kilowatt-hours attributable to electricity generated or purchased
             416      in that calendar year from qualifying zero carbon emissions generation and qualifying carbon
             417      sequestration generation;
             418          (b) the amount of those kilowatt-hours attributable to electricity generated or purchased
             419      in that calendar year from generation located within the geographic boundary of the Western
             420      Electricity Coordinating Council that derives its energy from one or more of the following but
             421      that does not satisfy the definition of a renewable energy source or that otherwise has not been
             422      used to satisfy Subsection 54-17-602 (1):
             423          (i) wind energy;
             424          (ii) solar photovoltaic and solar thermal energy;
             425          (iii) wave, tidal, and ocean thermal energy;
             426          (iv) except for combustion of wood that has been treated with chemical preservatives
             427      such as creosote, pentachlorophenol or chromated copper arsenate, biomass and biomass
             428      byproducts, including:
             429          (A) organic waste;
             430          (B) forest or rangeland woody debris from harvesting or thinning conducted to improve


             431      forest or rangeland ecological health and to reduce wildfire risk;
             432          (C) agricultural residues;
             433          (D) dedicated energy crops; and
             434          (E) landfill gas or biogas produced from organic matter, wastewater, anaerobic
             435      digesters, or municipal solid waste;
             436          (v) geothermal energy;
             437          (vi) hydroelectric energy; or
             438          (vii) waste gas and waste heat capture or recovery; and
             439          (c) the number of kilowatt-hours attributable to reductions in retail sales in that
             440      calendar year from demand side management as defined in Section 54-7-12.8 , with the
             441      kilowatt-hours for an electrical corporation whose rates are regulated by the commission and
             442      adjusted by the commission to exclude kilowatt-hours for which a renewable energy certificate
             443      is issued under Subsection 54-17-603 (4)(b).
             444          (2) "Amount of kilowatt-hours attributable to electricity generated or purchased in that
             445      calendar year from qualifying carbon sequestration generation," for qualifying carbon
             446      sequestration generation, means the kilowatt-hours supplied by a facility during the calendar
             447      year multiplied by the ratio of the amount of carbon dioxide captured from the facility and
             448      sequestered to the sum of the amount of carbon dioxide captured from the facility and
             449      sequestered plus the amount of carbon dioxide emitted from the facility during the same
             450      calendar year.
             451          (3) "Banked renewable energy certificate" means a bundled or unbundled renewable
             452      energy certificate that is:
             453          (a) not used in a calendar year to comply with this part or with a renewable energy
             454      program in another state; and
             455          (b) carried forward into a subsequent year.
             456          (4) "Bundled renewable energy certificate" means a renewable energy certificate for
             457      qualifying electricity that is acquired:
             458          (a) by an electrical corporation by a trade, purchase, or other transfer of electricity that
             459      includes the renewable energy attributes of, or certificate that is issued for, the electricity; or
             460          (b) by an electrical corporation by generating the electricity for which the renewable
             461      energy certificate is issued.


             462          (5) "Electrical corporation":
             463          (a) is as defined in Section 54-2-1 ; and
             464          (b) does not include a person generating electricity that is not for sale to the public.
             465          (6) "Qualifying carbon sequestration generation" means a fossil-fueled [generating]
             466      generation facility located within the geographic boundary of the Western Electricity
             467      Coordinating Council that:
             468          (a) becomes operational or is retrofitted on or after January 1, 2008; and
             469          (b) reduces carbon dioxide emissions into the atmosphere through permanent
             470      geological sequestration or through another verifiably permanent reduction in carbon dioxide
             471      emissions through the use of technology.
             472          (7) "Qualifying electricity" means electricity generated on or after January 1, 1995
             473      from a renewable energy source if:
             474          (a) (i) the renewable energy source is located within the geographic boundary of the
             475      Western Electricity Coordinating Council; or
             476          (ii) the qualifying electricity is delivered to the transmission system of an electrical
             477      corporation or a delivery point designated by the electrical corporation for the purpose of
             478      subsequent delivery to the electrical corporation; and
             479          (b) the renewable energy attributes of the electricity are not traded, sold, transferred, or
             480      otherwise used to satisfy another state's renewable energy program.
             481          (8) "Qualifying zero carbon emissions generation":
             482          (a) means a generation facility located within the geographic boundary of the Western
             483      Electricity Coordinating Council that:
             484          (i) becomes operational on or after January 1, 2008; and
             485          (ii) does not produce carbon as a byproduct of the generation process;
             486          (b) includes generation powered by nuclear fuel; and
             487          (c) does not include renewable energy sources used to satisfy the requirement
             488      established under Subsection 54-17-602 (1).
             489          (9) "Renewable energy certificate" means a certificate issued under Section 54-17-603 .
             490          (10) "Renewable energy source" means:
             491          (a) an electric generation facility or generation capability or upgrade that becomes
             492      operational on or after January 1, 1995 that derives its energy from one or more of the


             493      following:
             494          (i) wind energy;
             495          (ii) solar photovoltaic and solar thermal energy;
             496          (iii) wave, tidal, and ocean thermal energy;
             497          (iv) except for combustion of wood that has been treated with chemical preservatives
             498      such as creosote, pentachlorophenol or chromated copper arsenate, biomass and biomass
             499      byproducts, including:
             500          (A) organic waste;
             501          (B) forest or rangeland woody debris from harvesting or thinning conducted to improve
             502      forest or rangeland ecological health and to reduce wildfire risk;
             503          (C) agricultural residues;
             504          (D) dedicated energy crops; and
             505          (E) landfill gas or biogas produced from organic matter, wastewater, anaerobic
             506      digesters, or municipal solid waste;
             507          (v) geothermal energy located outside the state;
             508          (vi) waste gas and waste heat capture or recovery; or
             509          (vii) efficiency upgrades to a hydroelectric facility, without regard to the date upon
             510      which the facility became operational, if the upgrades become operational on or after January
             511      1, 1995;
             512          (b) any of the following:
             513          (i) up to 50 average megawatts of electricity per year per electrical corporation from a
             514      certified low-impact hydroelectric facility, without regard to the date upon which the facility
             515      becomes operational, if the facility is certified as a low-impact hydroelectric facility on or after
             516      January 1, 1995, by a national certification organization;
             517          (ii) geothermal energy if located within the state, without regard to the date upon which
             518      the facility becomes operational; or
             519          (iii) hydroelectric energy if located within the state, without regard to the date upon
             520      which the facility becomes operational;
             521          (c) hydrogen gas derived from any source of energy described in Subsection (10)(a) or
             522      (b);
             523          (d) if an electric generation facility employs multiple energy sources, that portion of the


             524      electricity generated that is attributable to energy sources described in Subsections (10)(a)
             525      through (c); and
             526          (e) any of the following located in the state and owned by a user of energy:
             527          (i) a demand side management measure, as defined by Subsection 54-7-12.8 (1), with
             528      the quantity of renewable energy certificates to which the user is entitled determined by the
             529      equivalent energy saved by the measure;
             530          (ii) a solar thermal system that reduces the consumption of fossil fuels, with the
             531      quantity of renewable energy certificates to which the user is entitled determined by the
             532      equivalent kilowatt-hours saved, except to the extent the commission determines otherwise
             533      with respect to net-metered energy;
             534          (iii) a solar photovoltaic system that reduces the consumption of fossil fuels with the
             535      quantity of renewable energy certificates to which the user is entitled determined by the total
             536      production of the system, except to the extent the commission determines otherwise with
             537      respect to net-metered energy;
             538          (iv) a hydroelectric or geothermal facility with the quantity of renewable energy
             539      certificates to which the user is entitled determined by the total production of the facility,
             540      except to the extent the commission determines otherwise with respect to net-metered energy;
             541          (v) a waste gas or waste heat capture or recovery system, other than from a combined
             542      cycle combustion turbine that does not use waste gas or waste heat, with the quantity of
             543      renewable energy certificates to which the user is entitled determined by the total production of
             544      the system, except to the extent the commission determines otherwise with respect to
             545      net-metered energy; and
             546          (vi) the station use of solar thermal energy, solar photovoltaic energy, hydroelectric
             547      energy, geothermal energy, waste gas, or waste heat capture and recovery.
             548          (11) "Unbundled renewable energy certificate" means a renewable energy certificate
             549      associated with:
             550          (a) qualifying electricity that is acquired by an electrical corporation or other person by
             551      trade, purchase, or other transfer without acquiring the electricity for which the certificate was
             552      issued; or
             553          (b) activities listed in Subsection (10)(e).





Legislative Review Note
    as of 2-3-09 7:06 AM


Office of Legislative Research and General Counsel


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