Chief Sponsor: Stephen G. Handy

Senate Sponsor: Daniel Hemmert

6     Cosponsors:
7     Patrice M. Arent
8     Stewart E. Barlow
9     Walt Brooks
Tim Quinn
Angela Romero
Douglas V. Sagers
V. Lowry Snow
Jeffrey D. Stenquist
Elizabeth Weight


12     General Description:
13          This bill enacts the Community Renewable Energy Act in the Public Utilities Code.
14     Highlighted Provisions:
15          This bill:
16          ▸     enacts the Community Renewable Energy Act;
17          ▸     defines terms and program requirements under the act;
18          ▸     outlines the role and rulemaking authority of the Utah Public Service Commission
19     in approving a community renewable energy program under the act;
20          ▸     establishes and clarifies options for customer participation and nonparticipation in
21     programs under the act;
22          ▸     provides an initial opt-out period for a participating customer to elect to leave the
23     community renewable energy program without penalty;
24          ▸     establishes procedures concerning rates, customer billing, and renewable energy
25     resource acquisition under the act; and
26          ▸     makes technical changes.
27     Money Appropriated in this Bill:
28          None

29     Other Special Clauses:
30          None
31     Utah Code Sections Affected:
32     ENACTS:
33          54-17-901, Utah Code Annotated 1953
34          54-17-902, Utah Code Annotated 1953
35          54-17-903, Utah Code Annotated 1953
36          54-17-904, Utah Code Annotated 1953
37          54-17-905, Utah Code Annotated 1953
38          54-17-906, Utah Code Annotated 1953
39          54-17-907, Utah Code Annotated 1953
40          54-17-908, Utah Code Annotated 1953
41          54-17-909, Utah Code Annotated 1953

43     Be it enacted by the Legislature of the state of Utah:
44          Section 1. Section 54-17-901 is enacted to read:
Part 9. Community Renewable Energy Act

46          54-17-901. Community Renewable Energy Act.
47          This part is known as the "Community Renewable Energy Act."
48          Section 2. Section 54-17-902 is enacted to read:
49          54-17-902. Definitions.
50          As used in this part:
51          (1) (a) "Auxiliary services" means those services necessary to safely and reliably:
52          (i) interconnect and transmit electric power from any renewable energy resource
53     constructed or acquired for a community renewable energy program; and
54          (ii) integrate and supplement electric power from any renewable energy resource.
55          (b) "Auxiliary services" shall include applicable Federal Energy Regulatory
56     Commission requirements governing transmission and interconnection services.

57          (2) "Commission" means the Public Service Commission created in Section 54-1-1.
58          (3) "Community renewable energy program" means the program approved by the
59     commission under Section 54-17-904 that allows a qualified utility to provide electric service
60     from one or more renewable energy resources to a participating customer within a participating
61     community.
62          (4) "County" means the unincorporated area of a county.
63          (5) "Division" means the Division of Public Utilities created in Section 54-4a-1.
64          (6) (a) "Initial opt-out period" means the period of time immediately after the
65     community renewable energy program's commencement, as established by the commission by
66     rule made pursuant to Section 54-17-909, during which a participating customer may elect to
67     leave the program without penalty.
68          (b) "Initial opt-out period" may not be shorter than three typical billing cycles of the
69     qualified utility.
70          (7) "Municipality" means a city or a town as defined in Section 10-1-104.
71          (8) "Office" means the Office of Consumer Services created in Section 54-10a-101.
72          (9) "Ongoing costs" means the costs allocated to the state for transmission and
73     distribution facilities, retail services, and generation assets that are not replaced assets.
74          (10) "Participating community" means a municipality or a county:
75          (a) whose residents are served by a qualified utility; and
76          (b) the municipality or county meets the requirements in Section 54-17-903.
77          (11) "Participating customer" means:
78          (a) a customer of a qualified utility located within the boundary of a municipality or
79     county where a community renewable energy program has been approved by the commission;
80     and
81          (b) the customer has not exercised the right to not participate in the community
82     renewable energy program as provided in Section 54-17-905.
83          (12) "Qualified utility" means the same as that term is defined in Section 54-17-801.
84          (13) "Renewable electric energy supply" means incremental renewable energy

85     resources that are developed to meet the equivalent of the annual electric energy consumption
86     of participating customers within a participating community.
87          (14) "Renewable energy resource" means:
88          (a) electric energy generated by a source that is naturally replenished and includes one
89     or more of the following:
90          (i) wind;
91          (ii) solar photovoltaic or thermal solar technology;
92          (iii) a geothermal resource; or
93          (iv) a hydroelectric plant; or
94          (b) use of an energy efficient and sustainable technology the commission has approved
95     for implementation that:
96          (i) increases efficient energy usage;
97          (ii) is capable of being used for demand response; or
98          (iii) facilitates the use and development of renewable generation resources through
99     electrical grid management or energy storage.
100          (15) "Replaced asset" means an existing thermal energy resource:
101          (a) that was built or acquired, in whole or in part, by a qualified utility to serve the
102     qualified utility's customers, including customers within a participating community;
103          (b) that was built or acquired prior to commission approval and the effective date of the
104     community renewable energy program; and
105          (c) to the extent the asset is no longer used to serve participating customers.
106          Section 3. Section 54-17-903 is enacted to read:
107          54-17-903. Program requirement for a municipality or county.
108          (1) Customers of a qualified utility may be served by the community renewable energy
109     program described in this part if the municipality or county satisfies the requirements of
110     Subsection (2).
111          (2) The municipality or county in which the customer resides shall:
112          (a) adopt a resolution no later than December 31, 2019, that states a goal of achieving

113     an amount equivalent to 100% of the annual electric energy supply for participating customers
114     from a renewable energy resource by 2030;
115          (b) enter into an agreement with a qualified utility:
116          (i) with the stipulation of payment by the municipality or county to the qualified utility
117     for the costs of:
118          (A) third-party expertise contracted for by the division and the office, for assistance
119     with activities associated with initial approval of the community renewable energy program;
120     and
121          (B) providing notice to the municipality's or county's customers as provided in Section
122     54-17-905;
123          (ii) determining the obligation for the payment of any termination charges under
124     Subsection 54-17-905(3) that are not paid by a participating customer and not included in
125     participating customer rates under Subsections 54-17-904 (2) and (4); and
126          (iii) identifying any initially proposed replaced asset;
127          (c) adopt a local ordinance that:
128          (i) establishes participation in the renewable energy program; and
129          (ii) is consistent with the terms of the agreement entered into with the qualified utility
130     under Subsection (2)(b); and
131          (d) comply with any other terms or conditions required by the commission.
132          (3) The local ordinance required in Subsection (2)(c) shall be adopted by the
133     municipality or county within 90 days after the date of the commission order approving the
134     community renewable energy program.
135          Section 4. Section 54-17-904 is enacted to read:
136          54-17-904. Authority of commission to approve a community renewable energy
137     program.
138          (1) After the commission has adopted administrative rules as required under Section
139     54-17-909, a qualified utility may file an application with the commission for approval of a
140     community renewable energy program.

141          (2) The application shall include:
142          (a) the names of each municipality and county to be served by the community
143     renewable energy program;
144          (b) a map of the geographic boundaries of each municipality and county;
145          (c) the number of customers served by the qualified utility within those boundaries;
146          (d) projected rates for participating customers that take into account:
147          (i) the estimated number of customers expected to participate in the program;
148          (ii) the quantifiable costs and benefits to the qualified utility and all of the qualified
149     utility's customers in their capacity as ratepayers of the qualified utility, excluding costs or
150     benefits that do not directly affect the qualified utility, including as applicable:
151          (A) replaced assets;
152          (B) auxiliary services; and
153          (C) new renewable energy resources used to serve the community renewable energy
154     program; and
155          (iii) the ongoing costs at the time of the application;
156          (e) the agreement entered into with the qualified utility under Section 54-17-903;
157          (f) a proposed plan established by the participating community addressing low-income
158     programs and assistance;
159          (g) a proposed solicitation process for the acquisition of renewable energy resources as
160     provided in Section 54-17-908; and
161          (h) any other information the commission may require by rule.
162          (3) The commission may approve an application for a community renewable energy
163     program if the commission finds:
164          (a) the application meets all of the requirements in this section and administrative rules
165     adopted by the commission in accordance with Sections 54-17-908 and 54-17-909 to
166     implement this part; and
167          (b) the community renewable energy program is in the public interest.
168          (4) The rates approved by the commission for participating customers:

169          (a) shall be based on the factors included in Subsection (2)(d) and any other factor
170     determined by the commission to be in the public interest;
171          (b) may not result in any shift of costs or benefits to any nonparticipating customer, or
172     any other customer of the qualified utility beyond the participating community boundaries; and
173          (c) shall take into account any quantifiable benefits to the qualified utility, and the
174     qualified utility's customers, including participating customers in their capacity as ratepayers of
175     the qualified utility, excluding costs or benefits that do not directly affect the qualified utility's
176     costs of service.
177          (5) (a) Each municipality or county included in the application shall be a party to the
178     regulatory proceeding.
179          (b) A municipality or county identified in the application shall provide information to
180     all relevant parties in accordance with the commission's rules for discovery, notwithstanding
181     Title 63G, Chapter 2, Government Records Access and Management Act.
182          (6) The community renewable energy program may not be implemented until after the
183     municipality or county adopts the ordinance required in Section 54-17-903.
184          Section 5. Section 54-17-905 is enacted to read:
185          54-17-905. Customer participation -- Election not to participate.
186          (1) (a) After commission approval of a community renewable energy program and
187     adoption of the ordinance by the participating community as required in Section 54-17-903, a
188     qualified utility shall provide notice to each of its customers within the participating
189     community that includes:
190          (i) the projected rates and terms of participation in the community renewable energy
191     program approved by the commission;
192          (ii) an estimated comparison to otherwise applicable existing rates;
193          (iii) an explanation that the customer may elect to not participate in the community
194     renewable energy program by notifying the qualified utility; and
195          (iv) any other information required by the commission.
196          (b) The qualified utility shall provide the notice required under Subsection (1)(a) to

197     each customer:
198          (i) no less than twice within the period of 60 days immediately preceding the date
199     required to opt out of the community renewable energy program; and
200          (ii) separately from the customer's monthly billing.
201          (c) The qualified utility shall provide the information required under Subsection (1)(a)
202     in person to each customer with an electric load of one megawatt or greater measured at a
203     single meter.
204          (2) (a) An existing customer of the qualified utility may elect to not participate in the
205     community renewable energy program and continue to pay applicable existing rates by giving
206     notice to the qualified utility in the manner and within the time period determined by the
207     commission.
208          (b) After implementation of the community renewable energy program:
209          (i) a customer that previously elected not to participate in the program may become a
210     participating customer as allowed by commission rules and by giving notice to the qualified
211     utility in the manner required by the commission; and
212          (ii) a customer of the qualified utility that begins taking electric service within a
213     participating community after the date of implementation of the community renewable energy
214     program shall:
215          (A) be given notice as determined by the commission; and
216          (B) shall become a participating customer unless the person elects not to participate by
217     giving notice to the qualified utility in the manner and within the time period determined by the
218     commission.
219          (3) (a) A customer that does not opt out of the community renewable energy program
220     under Subsection (2) may later discontinue participation in the community renewable energy
221     program as allowed by the commission as described in Subsection (3)(b) or (c).
222          (b) (i) During the initial opt-out period, a participating customer may elect to leave the
223     program by giving notice to the qualified utility in the manner determined by the commission.
224          (ii) A participating customer that opts out as described in Subsection (3)(b)(i) is not

225     subject to a termination charge.
226          (c) After the community renewable energy program's initial opt-out period, a
227     participating customer may elect to leave the program by:
228          (i) giving notice to the qualified utility in the manner determined by the commission;
229     and
230          (ii) paying a termination charge as determined by the commission that may include the
231     cost of renewable energy resources acquired or constructed for the community renewable
232     energy program that are not being utilized by participating customers as necessary to prevent
233     shifting costs to other customers of the qualified utility.
234          (4) (a) A customer of a qualified utility that is annexed into the boundaries of a
235     participating community after the effective date of the community renewable energy program
236     shall be given notice as provided in Subsection (1) advising the customer of the option to opt
237     out of the program.
238          (b) A participating customer located in a portion of a county that is annexed into a
239     municipality that is not a participating community shall continue to be included in the
240     renewable energy program if the customer remains a customer of the qualified utility.
241          (c) If a participating customer is annexed into a municipality that provides electric
242     service to the municipality's residents:
243          (i) the customer may continue to be served by the qualified utility under the community
244     renewable energy program if the qualified utility enters into an agreement with the municipality
245     under Section 54-3-30; or
246          (ii) the municipality shall pay the termination charge for each participating customer
247     that is no longer served by the qualified utility.
248          (5) A residential customer that is participating in the net metering program under Title
249     54, Chapter 15, Net Metering of Electricity, may not be a participating customer under this
250     part.
251          (6) (a) The cost of providing notice under Subsection (1) shall be paid by the
252     participating communities.

253          (b) All other notices required under this section shall be paid for as program costs and
254     recovered through participating customers' rates.
255          Section 6. Section 54-17-906 is enacted to read:
256          54-17-906. Customer billing.
257          The qualified utility shall:
258          (1) include information on its monthly bills to participating customers identifying the
259     community renewable energy program cost; and
260          (2) provide notice to participating customers of any change in rate for participation in
261     the community renewable energy program.
262          Section 7. Section 54-17-907 is enacted to read:
263          54-17-907. Rate adjustment filing -- Modification of rates for participating
264     customers.
265          (1) (a) The qualified utility may make a rate adjustment filing, not more than annually,
266     with the commission to adjust rates for participating customers to reflect any changes in the
267     quantifiable costs and benefits of the community renewable energy program.
268          (b) The rate adjustment filing may not include any changes to ongoing costs.
269          (2) The commission shall determine the content and filing requirements for the filing
270     by administrative rules as described in Section 54-17-909.
271          (3) The commission shall determine rate changes which shall become effective within
272     90 days after the date of the filing, unless otherwise determined by the commission for good
273     cause.
274          Section 8. Section 54-17-908 is enacted to read:
275          54-17-908. Acquisition of renewable energy resources.
276          (1) In accordance with Title 63G, Chapter 3, Utah Administrative Rulemaking Act, the
277     commission shall make rules outlining a competitive solicitation process for the acquisition of
278     renewable assets acquired by the qualified utility for purposes of this act.
279          (2) The solicitation rules shall include the following provisions:
280          (a) solar photovoltaic or thermal solar energy facilities may be acquired under the

281     provisions of Section 54-17-807;
282          (b) renewable energy resources developed under this part shall be constructed or
283     acquired subject to an option by the qualified utility to own the renewable energy resource so
284     long as including the option in a solicitation is in the interest of participating customers and
285     other customers of the qualified utility; and
286          (c) any other requirement determined by the commission to be in the public interest.
287          (3) Upon completion of a solicitation under this section and the rules adopted by the
288     commission to implement this section, the commission may approve cost recovery for a
289     renewable energy resource for the community renewable energy program if approval of the
290     renewable energy resource:
291          (a) complies with the provisions of this part;
292          (b) does not result in shifting of costs or benefits to other customers of the qualified
293     utility; and
294          (c) is in the public interest.
295          Section 9. Section 54-17-909 is enacted to read:
296          54-17-909. Commission rulemaking authority.
297          In accordance with Title 63G, Chapter 3, Utah Administrative Rulemaking Act, the
298     commission shall adopt rules to implement this part, including:
299          (1) establishing the initial opt-out period;
300          (2) the terms and conditions of the agreement under Section 54-17-903;
301          (3) the content and filing of an application under Section 54-17-904;
302          (4) the notice requirements under Section 54-17-905;
303          (5) the standards for determining when a termination charge is applicable and the
304     amount and timing of a termination charge under Subsection 54-17-905(3);
305          (6) the content and filing requirements for the annual filing under Subsection
306     54-17-907(2);
307          (7) the solicitation requirements under Section 54-17-908; and
308          (8) any other requirements determined by the commission necessary to protect the

309     public interest and to implement this part.