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First Substitute S.B. 12

This document includes Senate Committee Amendments incorporated into the bill on Thu, Feb 9, 2012 at 9:01 AM by kcallred. --> This document includes Senate 2nd Reading Floor Amendments incorporated into the bill on Thu, Feb 16, 2012 at 5:25 PM by khelgesen. -->

Senator Mark B. Madsen proposes the following substitute bill:


             1     
ENERGY AMENDMENTS

             2     
2012 GENERAL SESSION

             3     
STATE OF UTAH

             4     
Chief Sponsor: Mark B. Madsen

             5     
House Sponsor: Michael E. Noel

             6     

             7      LONG TITLE
             8      General Description:
             9          This bill enacts provisions within the Energy Resource Procurement Act.
             10      Highlighted Provisions:
             11          This bill:
             12          .    enacts provisions relating to renewable energy facilities;
             13          .    authorizes an electric corporation to enter into a contract to supply electric service
             14      from one or more renewable energy facilities, under certain circumstances; and
             15          .    requires Public Service Commission approval of contracts for electric service from
             16      renewable energy facilities.
             17      Money Appropriated in this Bill:
             18          None
             19      Other Special Clauses:
             20          None
             21      Utah Code Sections Affected:
             22      ENACTS:
             23          54-17-801, Utah Code Annotated 1953
             24          54-17-802, Utah Code Annotated 1953
             25          54-17-803, Utah Code Annotated 1953



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             26
         54-17-804, Utah Code Annotated 1953
             27          54-17-805, Utah Code Annotated 1953
             28     

             29      Be it enacted by the Legislature of the state of Utah:
             30          Section 1. Section 54-17-801 is enacted to read:
             31     
Part 8. Renewable Energy Contracts

             32          54-17-801. Definitions.
             33          As used in this part:
             34          (1) "Contract customer" means a person who executes or will execute a renewable
             35      energy contract with a qualified utility.
             36          (2) "Qualified utility" means an electric corporation that serves more than 200,000
             37      retail customers in the state.
             38          (3) "Renewable energy contract" means a contract under this section for the delivery of
             39      electricity from one or more renewable energy facilities to a contract customer requiring the use
             40      of a qualified utility's transmission or distribution system to deliver the electricity from a
             41      renewable energy facility to the contract customer.
             42          (4) "Renewable energy facility":
             43          (a) except as provided in Subsection (4)(b), has the same meaning as renewable energy
             44      source defined in Section 54-17-601 ; and
             45          (b) does not include an electric generating facility whose costs have been included in a
             46      qualified utility's rates as a facility providing electric service to the qualified utility's system.
             47          Section 2. Section 54-17-802 is enacted to read:
             48          54-17-802. Contracts for the purchase of electricity from a renewable energy
             49      facility.
             50          (1) Within a reasonable time after receiving a request from a contract customer and
             51      subject to reasonable credit requirements, a qualified utility shall enter into a renewable energy
             52      contract with the requesting contract customer to supply some or all of the contract customer's
             53      electric service from one or more renewable energy facilities selected by the contract customer.
             54          (2) Subject to a contract customer agreeing to pay the qualified utility for all
             55      incremental costs associated with metering facilities, communication facilities, and
             56      administration, a renewable energy contract may provide for electricity to be delivered to a



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             57
     contract customer:
             58          (a) from one renewable energy facility to a contract customer's single metered delivery
             59      location;
             60          (b) from multiple renewable energy facilities to a contract customer's single metered
             61      delivery location; or
             62          (c) from one or more renewable energy facilities to a single contract customer's
             63      multiple metered delivery locations.
             64          (3) (a) A single contract customer may aggregate multiple metered delivery locations to
             65      satisfy the minimum megawatt limit under Subsection (4).
             66          (b) Multiple contract customers may not aggregate their separate metered delivery
             67      locations to satisfy the minimum megawatt limit under Subsection (4).
             68          (4) The amount of electricity provided to a contract customer under a renewable energy
             69      contract may not be less than 2.0 megawatts.
             70          (5) The amount of electricity provided in any hour to a contract customer under a
             71      renewable energy contract may not exceed the contract customer's metered kilowatt-hour load
             72      in that hour at the metered delivery locations under the contract.
             73          (6) A renewable energy contract that meets the requirements of Subsection (4) may
             74      provide for one or more increases in the amount of electricity to be provided under the contract
             75      even though the amount of electricity to be provided by the increase is less than the minimum
             76      amount required under Subsection (4).
             77          (7) The total amount of electricity to be generated by renewable energy facilities and
             78      delivered to contract customers at any one time under all renewable energy contracts may not
             79      exceed 300 megawatts, unless the commission approves in advance a higher amount.
             80          (8) Electricity generated by a renewable energy facility and delivered to a contract
             81      customer under a renewable energy contract may not be included in a net metering program
             82      under Chapter 15, Net Metering of Electricity.
             83          Section 3. Section 54-17-803 is enacted to read:
             84          54-17-803. Ownership of a renewable energy facility -- Joint ownership --
             85      Ownership of environmental attributes.
             86          (1) A renewable energy facility may be owned:
             87          (a) by a person who will be a contract customer receiving electricity from the



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Senate 2nd Reading Amendments 2-16-2012 kh/rhr

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Senate Committee Amendments 2-9-2012 kc/rhr
             88
     renewable energy facility;
             89          (b) by a qualified utility;
             90          (c) by a person other than a contract customer or qualified utility; or
             91          (d) jointly by any combination of Subsections (1)(a), (b), and (c), whether in equal
             92      shares or otherwise.
             93          (2) A qualified utility may be a joint owner of a renewable energy facility only if:
             94          (a) the qualified utility consents to being a joint owner; and
             95          (b) the joint ownership agreement requires the qualified utility to recover from contract
             96      customers receiving electricity from the renewable energy facility all of the qualified utility's
             97      costs associated with its ownership of the renewable energy facility, including administrative,
             98      acquisition, operation, and maintenance costs, unless the commission, in an order issued in a
             99      separate regulatory proceeding:
             100          (i) authorizes the qualified utility to recover some of those costs from customers other
             101      than contract customers:
             102          (ii) determines that the rate to be paid for electricity from the renewable energy facility
             103      by customers other than contract customers is cost effective; and
             104          (iii) approves the inclusion of the rate determined under Subsection (2)(b)(ii) in general
             105      rates S. or through a commission approved cost recovery mechanism .S .
             106          (3) To the extent that any electricity from a renewable energy facility to be delivered to
             107      a contract customer is owned by a person other than the contract customer:
             108          (a) the qualified utility shall, by contract with the owner of the S. electricity to be sold
             108a      from the .S renewable energy
             109      facility, purchase electricity for resale to one or more contract customers;
             110          (b) the qualified utility shall sell that electricity to the contract customer or customers
             111      under renewable energy contracts with the same duration and pricing as the contract between
             112      the qualified utility and the owner of the S. electricity to be sold from the .S renewable energy
             112a      facility; and
             113          (c) the qualified utility's contract with the owner of the S. electricity to be sold from
             113a      the .S renewable energy facility shall
             114      provide that the qualified utility's obligation to purchase electricity under that contract ceases if
             115      the contract customer defaults in its obligation to purchase and pay for the electricity under the
             116      contract with the qualified utility.
             117          (4) The right to any environmental attribute associated with a renewable energy facility
             118      shall remain the property of the renewable energy facility's owner, except to the extent that a



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             119
     contract to which the owner is a party provides otherwise.
             120          Section 4. Section 54-17-804 is enacted to read:
             121          54-17-804. Exemption from certificate of convenience and necessity requirements.
             122          (1) A qualified utility is not required to comply with Section 54-4-25 with respect to a
             123      renewable energy facility that is the subject of a renewable energy contract if:
             124          (a) each contract necessary for the commission to determine compliance with this part
             125      is filed with the commission; and
             126          (b) the commission determines that each contract relating to the renewable energy
             127      facility complies with this part.
             128          (2) In making its determination under Subsection (1)(b), the commission may process
             129      and consider together multiple renewable energy contracts between the same contract customer
             130      and the qualified utility providing for the delivery of electricity from a renewable energy
             131      facility to the contract customer's multiple metered delivery locations.
             132          Section 5. Section 54-17-805 is enacted to read:
             133          54-17-805. Costs associated with delivering electricity from a renewable energy
             134      facility to a contract customer.
             135          (1) To the extent that a renewable energy contract provides for the delivery of
             136      electricity from a renewable energy facility owned by the contract customer, the renewable
             137      energy contract shall require the contract customer to pay for the use of the qualified utility's
             138      transmission or distribution facilities at the qualified utility's applicable rates, which may
             139      include transmission costs at the qualified utility's applicable rate approved by the Federal
             140      Energy Regulatory Commission.
             141          (2) To the extent that a renewable energy contract provides for the delivery of
             142      electricity from a renewable energy facility owned by a person other than the qualified utility or
             143      the contract customer, the renewable energy contract shall require the contract customer to bear
             144      all reasonably identifiable costs that the qualified utility incurs in delivering the electricity from
             145      the renewable energy facility to the contract customer, including all costs to procure and deliver
             146      electricity and for billing, administrative, and related activities, as determined by the
             147      commission.
             148          (3) A qualified utility that enters a renewable energy contract shall charge a contract
             149      customer for all metered electric service delivered to the contract customer, including



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Senate Committee Amendments 2-9-2012 kc/rhr
             150
     generation, transmission, and distribution service, at the qualified utility's applicable tariff
             151      rates, excluding:
             152          (a) any kilowatt hours of electricity delivered from the renewable energy facility, based
             153      on the time of delivery, adjusted for transmission losses;
             154          (b) any S. [ kilowatt hours ] kilowatts .S of electricity delivered from the renewable
             154a      energy facility that
             155      coincide with the contract customer's monthly metered kilowatt demand measurement, adjusted
             156      for transmission losses;
             157          (c) any transmission and distribution service that the contract customer pays for under
             158      Subsection (1) or (2); and
             159          (d) any transmission service that the contract customer provides under Subsection (2)
             160      to deliver generation from the renewable energy facility.


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