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96TH GENERAL ASSEMBLY
State of Illinois
2009 and 2010 SB3686
Introduced 2/11/2010, by Sen. Don Harmon SYNOPSIS AS INTRODUCED: |
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20 ILCS 3855/1-10 |
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20 ILCS 3855/1-56 |
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20 ILCS 3855/1-75 |
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Amends the Illinois Power Agency Act. In provisions concerning the procurement of renewable energy resources, provides that at least 75% of the renewable energy resources shall come from wind generation and, in specified amounts by specified dates, of the renewable energy resources that must be derived from photovoltaics, at least 20% must come from large-scale distributed solar and at least 10% must come from small-scale distributed solar (rather than starting June 1, 2015, at least 6% of the renewable energy resources used to meet these standards shall come from solar photovoltaics). Provides that through June 1, 2016 (rather than June 1, 2011), renewable energy resources shall be counted for the purpose of meeting the renewable energy standards only if they are generated from facilities located in the State, provided that cost-effective renewable energy resources are available from those facilities. Provides that after June 1, 2016 (rather than June 1, 2011), cost-effective renewable energy resources located in Illinois and in states that adjoin Illinois may be counted towards compliance with specified standards. Effective immediately.
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A BILL FOR
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SB3686 |
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LRB096 20770 MJR 36521 b |
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| AN ACT concerning State government.
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| Be it enacted by the People of the State of Illinois,
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| represented in the General Assembly:
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| Section 5. The Illinois Power Agency Act is amended by |
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| changing Sections 1-10, 1-56, and 1-75 as follows:
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| (20 ILCS 3855/1-10)
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| Sec. 1-10. Definitions. |
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| "Agency" means the Illinois Power Agency. |
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| "Agency loan agreement" means any agreement pursuant to |
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| which the Illinois Finance Authority agrees to loan the |
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| proceeds of revenue bonds issued with respect to a project to |
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| the Agency upon terms providing for loan repayment installments |
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| at least sufficient to pay when due all principal of, interest |
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| and premium, if any, on those revenue bonds, and providing for |
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| maintenance, insurance, and other matters in respect of the |
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| project. |
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| "Authority" means the Illinois Finance Authority. |
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| "Clean coal facility" means an electric generating |
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| facility that uses primarily coal as a feedstock and that |
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| captures and sequesters carbon emissions at the following |
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| levels: at least 50% of the total carbon emissions that the |
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| facility would otherwise emit if, at the time construction |
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| commences, the facility is scheduled to commence operation |
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| before 2016, at least 70% of the total carbon emissions that |
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| the facility would otherwise emit if, at the time construction |
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| commences, the facility is scheduled to commence operation |
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| during 2016 or 2017, and at least 90% of the total carbon |
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| emissions that the facility would otherwise emit if, at the |
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| time construction commences, the facility is scheduled to |
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| commence operation after 2017. The power block of the clean |
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| coal facility shall not exceed allowable emission rates for |
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| sulfur dioxide, nitrogen oxides, carbon monoxide, particulates |
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| and mercury for a natural gas-fired combined-cycle facility the |
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| same size as and in the same location as the clean coal |
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| facility at the time the clean coal facility obtains an |
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| approved air permit. All coal used by a clean coal facility |
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| shall have high volatile bituminous rank and greater than 1.7 |
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| pounds of sulfur per million btu content, unless the clean coal |
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| facility does not use gasification technology and was operating |
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| as a conventional coal-fired electric generating facility on |
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| June 1, 2009 (the effective date of Public Act 95-1027). |
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| "Clean coal SNG facility" means a facility that uses a |
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| gasification process to produce substitute natural gas, that |
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| sequesters at least 90% of the total carbon emissions that the |
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| facility would otherwise emit and that uses petroleum coke or |
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| coal as a feedstock, with all such coal having a high |
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| bituminous rank and greater than 1.7 pounds of sulfur per |
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| million btu content. |
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| "Commission" means the Illinois Commerce Commission. |
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| "Costs incurred in connection with the development and |
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| construction of a facility" means: |
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| (1) the cost of acquisition of all real property and |
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| improvements in connection therewith and equipment and |
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| other property, rights, and easements acquired that are |
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| deemed necessary for the operation and maintenance of the |
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| facility; |
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| (2) financing costs with respect to bonds, notes, and |
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| other evidences of indebtedness of the Agency; |
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| (3) all origination, commitment, utilization, |
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| facility, placement, underwriting, syndication, credit |
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| enhancement, and rating agency fees; |
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| (4) engineering, design, procurement, consulting, |
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| legal, accounting, title insurance, survey, appraisal, |
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| escrow, trustee, collateral agency, interest rate hedging, |
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| interest rate swap, capitalized interest and other |
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| financing costs, and other expenses for professional |
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| services; and |
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| (5) the costs of plans, specifications, site study and |
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| investigation, installation, surveys, other Agency costs |
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| and estimates of costs, and other expenses necessary or |
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| incidental to determining the feasibility of any project, |
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| together with such other expenses as may be necessary or |
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| incidental to the financing, insuring, acquisition, and |
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| construction of a specific project and placing that project |
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| in operation. |
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| "Department" means the Department of Commerce and Economic |
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| Opportunity. |
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| "Director" means the Director of the Illinois Power Agency. |
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| "Demand-response" means measures that decrease peak |
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| electricity demand or shift demand from peak to off-peak |
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| periods. |
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| "Energy efficiency" means measures that reduce the amount |
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| of electricity or natural gas required to achieve a given end |
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| use. |
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| "Electric utility" has the same definition as found in |
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| Section 16-102 of the Public Utilities Act. |
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| "Facility" means an electric generating unit or a |
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| co-generating unit that produces electricity along with |
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| related equipment necessary to connect the facility to an |
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| electric transmission or distribution system. |
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| "Governmental aggregator" means one or more units of local |
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| government that individually or collectively procure |
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| electricity to serve residential retail electrical loads |
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| located within its or their jurisdiction. |
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| "Local government" means a unit of local government as |
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| defined in Article VII of Section 1 of the Illinois |
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| Constitution. |
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| "Large-scale distributed solar" means photovoltaic systems |
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| that (i) have a generation capacity greater than 10 kilowatts |
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| and (ii) are located on the customer's side of customer's |
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| electric meter. |
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| "Municipality" means a city, village, or incorporated |
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| town. |
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| "Person" means any natural person, firm, partnership, |
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| corporation, either domestic or foreign, company, association, |
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| limited liability company, joint stock company, or association |
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| and includes any trustee, receiver, assignee, or personal |
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| representative thereof. |
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| "Project" means the planning, bidding, and construction of |
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| a facility. |
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| "Public utility" has the same definition as found in |
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| Section 3-105 of the Public Utilities Act. |
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| "Real property" means any interest in land together with |
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| all structures, fixtures, and improvements thereon, including |
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| lands under water and riparian rights, any easements, |
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| covenants, licenses, leases, rights-of-way, uses, and other |
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| interests, together with any liens, judgments, mortgages, or |
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| other claims or security interests related to real property. |
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| "Renewable energy credit" means a tradable credit that |
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| represents the environmental attributes of a certain amount of |
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| energy produced from a renewable energy resource. |
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| "Renewable energy resources" includes energy and its |
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| associated renewable energy credit or renewable energy credits |
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| from wind, solar thermal energy, photovoltaic cells and panels, |
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| biodiesel, crops and untreated and unadulterated organic waste |
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| biomass, tree waste, hydropower that does not involve new |
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| construction or significant expansion of hydropower dams, and |
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| other alternative sources of environmentally preferable |
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| energy. For purposes of this Act, landfill gas produced in the |
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| State is considered a renewable energy resource. "Renewable |
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| energy resources" does not include the incineration or burning |
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| of tires, garbage, general household, institutional, and |
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| commercial waste, industrial lunchroom or office waste, |
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| landscape waste other than tree waste, railroad crossties, |
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| utility poles, or construction or demolition debris, other than |
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| untreated and unadulterated waste wood. |
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| "Small-scale distributed solar" means photovoltaic systems |
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| that (i) have a generation capacity of 10 kilowatts or less and |
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| (ii) are located on the customer's side of customer's electric |
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| meter. |
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| "Revenue bond" means any bond, note, or other evidence of |
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| indebtedness issued by the Authority, the principal and |
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| interest of which is payable solely from revenues or income |
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| derived from any project or activity of the Agency. |
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| "Sequester" means permanent storage of carbon dioxide by |
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| injecting it into a saline aquifer, a depleted gas reservoir, |
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| or an oil reservoir, directly or through an enhanced oil |
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| recovery process that may involve intermediate storage in a |
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| salt dome. |
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| "Servicing agreement" means (i) in the case of an electric |
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| utility, an agreement between the owner of a clean coal |
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| facility and such electric utility, which agreement shall have |
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| terms and conditions meeting the requirements of paragraph (3) |
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| of subsection (d) of Section 1-75, and (ii) in the case of an |
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| alternative retail electric supplier, an agreement between the |
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| owner of a clean coal facility and such alternative retail |
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| electric supplier, which agreement shall have terms and |
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| conditions meeting the requirements of Section 16-115(d)(5) of |
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| the Public Utilities Act. |
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| "Substitute natural gas" or "SNG" means a gas manufactured |
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| by gasification of hydrocarbon feedstock, which is |
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| substantially interchangeable in use and distribution with |
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| conventional natural gas. |
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| "Total resource cost test" or "TRC test" means a standard |
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| that is met if, for an investment in energy efficiency or |
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| demand-response measures, the benefit-cost ratio is greater |
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| than one. The benefit-cost ratio is the ratio of the net |
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| present value of the total benefits of the program to the net |
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| present value of the total costs as calculated over the |
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| lifetime of the measures. A total resource cost test compares |
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| the sum of avoided electric utility costs, representing the |
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| benefits that accrue to the system and the participant in the |
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| delivery of those efficiency measures, as well as other |
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| quantifiable societal benefits, including avoided natural gas |
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| utility costs, to the sum of all incremental costs of end-use |
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| measures that are implemented due to the program (including |
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| both utility and participant contributions), plus costs to |
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| administer, deliver, and evaluate each demand-side program, to |
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| quantify the net savings obtained by substituting the |
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| demand-side program for supply resources. In calculating |
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| avoided costs of power and energy that an electric utility |
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| would otherwise have had to acquire, reasonable estimates shall |
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| be included of financial costs likely to be imposed by future |
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| regulations and legislation on emissions of greenhouse gases.
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| (Source: P.A. 95-481, eff. 8-28-07; 95-913, eff. 1-1-09; |
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| 95-1027, eff. 6-1-09; 96-33, eff. 7-10-09; 96-159, eff. |
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| 8-10-09; 96-784, eff. 8-28-09; revised 9-15-09.)
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| (20 ILCS 3855/1-56) |
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| Sec. 1-56. Illinois Power Agency Renewable Energy |
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| Resources Fund. |
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| (a) The Illinois Power Agency Renewable Energy Resources |
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| Fund is created as a special fund in the State treasury. |
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| (b) The Illinois Power Agency Renewable Energy Resources |
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| Fund shall be administered by the Agency to procure renewable |
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| energy resources. Prior to June 1, 2016 2011 , resources |
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| procured pursuant to this Section shall be procured from |
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| facilities located in Illinois, provided the resources are |
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| available from those facilities. If resources are not available |
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| in Illinois, then they shall be procured in states that adjoin |
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| Illinois. If resources are not available in Illinois or in |
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| states that adjoin Illinois, then they may be purchased |
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| elsewhere. Beginning June 1, 2016 2011 , resources procured |
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| pursuant to this Section shall be procured from facilities |
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| located in Illinois or states that adjoin Illinois. If |
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| resources are not available in Illinois or in states that |
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| adjoin Illinois, then they may be procured elsewhere. To the |
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| extent available, at least 75% of these renewable energy |
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| resources shall come from wind generation . and, Of the |
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| renewable energy resources that must be derived from |
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| photovoltaics under this subsection (b), (0.5% by June 1, 2012, |
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| 1.5% by June 1, 2013, 3% by June 1, 2014, and 6% by June 15 and |
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| each year thereafter) at least 20% must come from large-scale |
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| distributed solar and at least 10% must come from small-scale |
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| distributed solar starting June 1, 2015, at least 6% of the |
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| renewable energy resources used to meet these standards shall |
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| come from solar photovoltaics . |
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| (c) The Agency shall procure renewable energy resources at |
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| least once each year in conjunction with a procurement event |
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| for electric utilities required to comply with Section 1-75 of |
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| the Act and shall, whenever possible, enter into long-term |
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| contracts. |
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| (d) The price paid to procure renewable energy credits |
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| using monies from the Illinois Power Agency Renewable Energy |
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| Resources Fund shall not exceed the winning bid prices paid for |
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| like resources procured for electric utilities required to |
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| comply with Section 1-75 of this Act. |
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| (e) All renewable energy credits procured using monies from |
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| the Illinois Power Agency Renewable Energy Resources Fund shall |
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| be permanently retired. |
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| (f) The procurement process described in this Section is |
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| exempt from the requirements of the Illinois Procurement Code, |
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| pursuant to Section 20-10 of that Code. |
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| (g) All disbursements from the Illinois Power Agency |
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| Renewable Energy Resources Fund shall be made only upon |
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| warrants of the Comptroller drawn upon the Treasurer as |
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| custodian of the Fund upon vouchers signed by the Director or |
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| by the person or persons designated by the Director for that |
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| purpose. The Comptroller is authorized to draw the warrant upon |
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| vouchers so signed. The Treasurer shall accept all warrants so |
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| signed and shall be released from liability for all payments |
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| made on those warrants. |
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| (h) The Illinois Power Agency Renewable Energy Resources |
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| Fund shall not be subject to sweeps, administrative charges, or |
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| chargebacks, including, but not limited to, those authorized |
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| under Section 8h of the State Finance Act, that would in any |
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| way result in the transfer of any funds from this Fund to any |
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| other fund of this State or in having any such funds utilized |
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| for any purpose other than the express purposes set forth in |
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| this Section.
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| (Source: P.A. 96-159, eff. 8-10-09.) |
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| (20 ILCS 3855/1-75) |
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| Sec. 1-75. Planning and Procurement Bureau. The Planning |
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| and Procurement Bureau has the following duties and |
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| responsibilities: |
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| (a) The Planning and Procurement Bureau shall each |
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| year, beginning in 2008, develop procurement plans and |
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| conduct competitive procurement processes in accordance |
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| with the requirements of Section 16-111.5 of the Public |
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| Utilities Act for the eligible retail customers of electric |
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| utilities that on December 31, 2005 provided electric |
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| service to at least 100,000 customers in Illinois. For the |
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| purposes of this Section, the term "eligible retail |
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| customers" has the same definition as found in Section |
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| 16-111.5(a) of the Public Utilities Act. |
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| (1) The Agency shall each year, beginning in 2008, |
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| as needed, issue a request for qualifications for |
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| experts or expert consulting firms to develop the |
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| procurement plans in accordance with Section 16-111.5 |
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| of the Public Utilities Act. In order to qualify an |
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| expert or expert consulting firm must have: |
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| (A) direct previous experience assembling |
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| large-scale power supply plans or portfolios for |
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| end-use customers; |
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| (B) an advanced degree in economics, |
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| mathematics, engineering, risk management, or a |
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| related area of study; |
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| (C) 10 years of experience in the electricity |
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| sector, including managing supply risk; |
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| (D) expertise in wholesale electricity market |
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| rules, including those established by the Federal |
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| Energy Regulatory Commission and regional |
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| transmission organizations; |
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| (E) expertise in credit protocols and |
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| familiarity with contract protocols; |
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| (F) adequate resources to perform and fulfill |
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| the required functions and responsibilities; and |
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| (G) the absence of a conflict of interest and |
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| inappropriate bias for or against potential |
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| bidders or the affected electric utilities. |
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| (2) The Agency shall each year, as needed, issue a |
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| request for qualifications for a procurement |
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| administrator to conduct the competitive procurement |
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| processes in accordance with Section 16-111.5 of the |
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| Public Utilities Act. In order to qualify an expert or |
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| expert consulting firm must have: |
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| (A) direct previous experience administering a |
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| large-scale competitive procurement process; |
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| (B) an advanced degree in economics, |
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| mathematics, engineering, or a related area of |
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| study; |
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| (C) 10 years of experience in the electricity |
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| sector, including risk management experience; |
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| (D) expertise in wholesale electricity market |
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| rules, including those established by the Federal |
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| Energy Regulatory Commission and regional |
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| transmission organizations; |
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| (E) expertise in credit and contract |
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| protocols; |
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| (F) adequate resources to perform and fulfill |
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| the required functions and responsibilities; and |
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| (G) the absence of a conflict of interest and |
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| inappropriate bias for or against potential |
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| bidders or the affected electric utilities. |
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| (3) The Agency shall provide affected utilities |
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| and other interested parties with the lists of |
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| qualified experts or expert consulting firms |
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| identified through the request for qualifications |
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| processes that are under consideration to develop the |
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| procurement plans and to serve as the procurement |
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| administrator. The Agency shall also provide each |
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| qualified expert's or expert consulting firm's |
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| response to the request for qualifications. All |
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| information provided under this subparagraph shall |
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| also be provided to the Commission. The Agency may |
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| provide by rule for fees associated with supplying the |
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| information to utilities and other interested parties. |
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| These parties shall, within 5 business days, notify the |
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| Agency in writing if they object to any experts or |
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| expert consulting firms on the lists. Objections shall |
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| be based on: |
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| (A) failure to satisfy qualification criteria; |
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| (B) identification of a conflict of interest; |
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| or |
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| (C) evidence of inappropriate bias for or |
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| against potential bidders or the affected |
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| utilities. |
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| The Agency shall remove experts or expert |
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| consulting firms from the lists within 10 days if there |
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| is a reasonable basis for an objection and provide the |
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| updated lists to the affected utilities and other |
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| interested parties. If the Agency fails to remove an |
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| expert or expert consulting firm from a list, an |
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| objecting party may seek review by the Commission |
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| within 5 days thereafter by filing a petition, and the |
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| Commission shall render a ruling on the petition within |
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| 10 days. There is no right of appeal of the |
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| Commission's ruling. |
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| (4) The Agency shall issue requests for proposals |
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| to the qualified experts or expert consulting firms to |
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| develop a procurement plan for the affected utilities |
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| and to serve as procurement administrator. |
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| (5) The Agency shall select an expert or expert |
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| consulting firm to develop procurement plans based on |
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| the proposals submitted and shall award one-year |
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| contracts to those selected with an option for the |
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| Agency for a one-year renewal. |
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| (6) The Agency shall select an expert or expert |
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| consulting firm, with approval of the Commission, to |
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| serve as procurement administrator based on the |
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| proposals submitted. If the Commission rejects, within |
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| 5 days, the Agency's selection, the Agency shall submit |
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| another recommendation within 3 days based on the |
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| proposals submitted. The Agency shall award a one-year |
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| contract to the expert or expert consulting firm so |
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| selected with Commission approval with an option for |
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| the Agency for a one-year renewal. |
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| (b) The experts or expert consulting firms retained by |
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| the Agency shall, as appropriate, prepare procurement |
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| plans, and conduct a competitive procurement process as |
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| prescribed in Section 16-111.5 of the Public Utilities Act, |
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| to ensure adequate, reliable, affordable, efficient, and |
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| environmentally sustainable electric service at the lowest |
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| total cost over time, taking into account any benefits of |
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| price stability, for eligible retail customers of electric |
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| utilities that on December 31, 2005 provided electric |
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| service to at least 100,000 customers in the State of |
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| Illinois. |
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| (c) Renewable portfolio standard. |
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| (1) The procurement plans shall include |
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| cost-effective renewable energy resources. A minimum |
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| percentage of each utility's total supply to serve the |
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| load of eligible retail customers, as defined in |
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| Section 16-111.5(a) of the Public Utilities Act, |
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| procured for each of the following years shall be |
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| generated from cost-effective renewable energy |
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| resources: at least 2% by June 1, 2008; at least 4% by |
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| June 1, 2009; at least 5% by June 1, 2010; at least 6% |
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| by June 1, 2011; at least 7% by June 1, 2012; at least |
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| 8% by June 1, 2013; at least 9% by June 1, 2014; at |
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| least 10% by June 1, 2015; and increasing by at least |
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| 1.5% each year thereafter to at least 25% by June 1, |
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| 2025. To the extent that it is available, at least 75% |
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| of the renewable energy resources used to meet these |
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| standards shall come from wind generation and, |
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| beginning on June 1, 2011 2015 , at least the following |
11 |
| percentages 6% of the renewable energy resources used |
12 |
| to meet these standards shall come from photovoltaics : |
13 |
| 0.5% by June 1, 2012, 1.5% by June 1, 2013, 3% by June |
14 |
| 1, 2014, and 6% by June 1, 2015 and each year |
15 |
| thereafter. Of the renewable energy resources that |
16 |
| must be derived from photovoltaics under this |
17 |
| subsection (c), at least 20% must come from large-scale |
18 |
| distributed solar and at least 10% must come from |
19 |
| small-scale distributed solar . For purposes of this |
20 |
| subsection (c), "cost-effective" means that the costs |
21 |
| of procuring renewable energy resources do not cause |
22 |
| the limit stated in paragraph (2) of this subsection |
23 |
| (c) to be exceeded and do not exceed benchmarks based |
24 |
| on market prices for renewable energy resources in the |
25 |
| region, which shall be developed by the procurement |
26 |
| administrator, in consultation with the Commission |
|
|
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LRB096 20770 MJR 36521 b |
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|
1 |
| staff, Agency staff, and the procurement monitor and |
2 |
| shall be subject to Commission review and approval. |
3 |
| (2) For purposes of this subsection (c), the |
4 |
| required procurement of cost-effective renewable |
5 |
| energy resources for a particular year shall be |
6 |
| measured as a percentage of the actual amount of |
7 |
| electricity (megawatt-hours) supplied by the electric |
8 |
| utility to eligible retail customers in the planning |
9 |
| year ending immediately prior to the procurement. For |
10 |
| purposes of this subsection (c), the amount paid per |
11 |
| kilowatthour means the total amount paid for electric |
12 |
| service expressed on a per kilowatthour basis. For |
13 |
| purposes of this subsection (c), the total amount paid |
14 |
| for electric service includes without limitation |
15 |
| amounts paid for supply, transmission, distribution, |
16 |
| surcharges, and add-on taxes. |
17 |
| Notwithstanding the requirements of this |
18 |
| subsection (c), the total of renewable energy |
19 |
| resources procured pursuant to the procurement plan |
20 |
| for any single year shall be reduced by an amount |
21 |
| necessary to limit the annual estimated average net |
22 |
| increase due to the costs of these resources included |
23 |
| in the amounts paid by eligible retail customers in |
24 |
| connection with electric service to: |
25 |
| (A) in 2008, no more than 0.5% of the amount |
26 |
| paid per kilowatthour by those customers during |
|
|
|
SB3686 |
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LRB096 20770 MJR 36521 b |
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|
1 |
| the year ending May 31, 2007; |
2 |
| (B) in 2009, the greater of an additional 0.5% |
3 |
| of the amount paid per kilowatthour by those |
4 |
| customers during the year ending May 31, 2008 or 1% |
5 |
| of the amount paid per kilowatthour by those |
6 |
| customers during the year ending May 31, 2007; |
7 |
| (C) in 2010, the greater of an additional 0.5% |
8 |
| of the amount paid per kilowatthour by those |
9 |
| customers during the year ending May 31, 2009 or |
10 |
| 1.5% of the amount paid per kilowatthour by those |
11 |
| customers during the year ending May 31, 2007; |
12 |
| (D) in 2011, the greater of an additional 0.5% |
13 |
| of the amount paid per kilowatthour by those |
14 |
| customers during the year ending May 31, 2010 or 2% |
15 |
| of the amount paid per kilowatthour by those |
16 |
| customers during the year ending May 31, 2007; and |
17 |
| (E) thereafter, the amount of renewable energy |
18 |
| resources procured pursuant to the procurement |
19 |
| plan for any single year shall be reduced by an |
20 |
| amount necessary to limit the estimated average |
21 |
| net increase due to the cost of these resources |
22 |
| included in the amounts paid by eligible retail |
23 |
| customers in connection with electric service to |
24 |
| no more than the greater of 2.015% of the amount |
25 |
| paid per kilowatthour by those customers during |
26 |
| the year ending May 31, 2007 or the incremental |
|
|
|
SB3686 |
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LRB096 20770 MJR 36521 b |
|
|
1 |
| amount per kilowatthour paid for these resources |
2 |
| in 2011. |
3 |
| No later than June 30, 2011, the Commission shall |
4 |
| review the limitation on the amount of renewable energy |
5 |
| resources procured pursuant to this subsection (c) and |
6 |
| report to the General Assembly its findings as to |
7 |
| whether that limitation unduly constrains the |
8 |
| procurement of cost-effective renewable energy |
9 |
| resources. |
10 |
| (3) Through June 1, 2016 2011 , renewable energy |
11 |
| resources shall be counted for the purpose of meeting |
12 |
| the renewable energy standards set forth in paragraph |
13 |
| (1) of this subsection (c) only if they are generated |
14 |
| from facilities located in the State, provided that |
15 |
| cost-effective renewable energy resources are |
16 |
| available from those facilities. If those |
17 |
| cost-effective resources are not available in |
18 |
| Illinois, they shall be procured in states that adjoin |
19 |
| Illinois and may be counted towards compliance. If |
20 |
| those cost-effective resources are not available in |
21 |
| Illinois or in states that adjoin Illinois, they shall |
22 |
| be purchased elsewhere and shall be counted towards |
23 |
| compliance. After June 1, 2016 2011 , cost-effective |
24 |
| renewable energy resources located in Illinois and in |
25 |
| states that adjoin Illinois may be counted towards |
26 |
| compliance with the standards set forth in paragraph |
|
|
|
SB3686 |
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LRB096 20770 MJR 36521 b |
|
|
1 |
| (1) of this subsection (c). If those cost-effective |
2 |
| resources are not available in Illinois or in states |
3 |
| that adjoin Illinois, they shall be purchased |
4 |
| elsewhere and shall be counted towards compliance. |
5 |
| (4) The electric utility shall retire all |
6 |
| renewable energy credits used to comply with the |
7 |
| standard. |
8 |
| (5) Beginning with the year commencing June 1, |
9 |
| 2010, an electric utility subject to this subsection |
10 |
| (c) shall apply the lesser of the maximum alternative |
11 |
| compliance payment rate or the most recent estimated |
12 |
| alternative compliance payment rate for its service |
13 |
| territory for the corresponding compliance period, |
14 |
| established pursuant to subsection (d) of Section |
15 |
| 16-115D of the Public Utilities Act to its retail |
16 |
| customers that take service pursuant to the electric |
17 |
| utility's hourly pricing tariff or tariffs. The |
18 |
| electric utility shall retain all amounts collected as |
19 |
| a result of the application of the alternative |
20 |
| compliance payment rate or rates to such customers, |
21 |
| and, beginning in 2011, the utility shall include in |
22 |
| the information provided under item (1) of subsection |
23 |
| (d) of Section 16-111.5 of the Public Utilities Act the |
24 |
| amounts collected under the alternative compliance |
25 |
| payment rate or rates for the prior year ending May 31. |
26 |
| Notwithstanding any limitation on the procurement of |
|
|
|
SB3686 |
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LRB096 20770 MJR 36521 b |
|
|
1 |
| renewable energy resources imposed by item (2) of this |
2 |
| subsection (c), the Agency shall increase its spending |
3 |
| on the purchase of renewable energy resources to be |
4 |
| procured by the electric utility for the next plan year |
5 |
| by an amount equal to the amounts collected by the |
6 |
| utility under the alternative compliance payment rate |
7 |
| or rates in the prior year ending May 31. |
8 |
| (d) Clean coal portfolio standard. |
9 |
| (1) The procurement plans shall include electricity |
10 |
| generated using clean coal. Each utility shall enter into |
11 |
| one or more sourcing agreements with the initial clean coal |
12 |
| facility, as provided in paragraph (3) of this subsection |
13 |
| (d), covering electricity generated by the initial clean |
14 |
| coal facility representing at least 5% of each utility's |
15 |
| total supply to serve the load of eligible retail customers |
16 |
| in 2015 and each year thereafter, as described in paragraph |
17 |
| (3) of this subsection (d), subject to the limits specified |
18 |
| in paragraph (2) of this subsection (d). It is the goal of |
19 |
| the State that by January 1, 2025, 25% of the electricity |
20 |
| used in the State shall be generated by cost-effective |
21 |
| clean coal facilities. For purposes of this subsection (d), |
22 |
| "cost-effective" means that the expenditures pursuant to |
23 |
| such sourcing agreements do not cause the limit stated in |
24 |
| paragraph (2) of this subsection (d) to be exceeded and do |
25 |
| not exceed cost-based benchmarks, which shall be developed |
26 |
| to assess all expenditures pursuant to such sourcing |
|
|
|
SB3686 |
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LRB096 20770 MJR 36521 b |
|
|
1 |
| agreements covering electricity generated by clean coal |
2 |
| facilities, other than the initial clean coal facility, by |
3 |
| the procurement administrator, in consultation with the |
4 |
| Commission staff, Agency staff, and the procurement |
5 |
| monitor and shall be subject to Commission review and |
6 |
| approval. |
7 |
| (A) A utility party to a sourcing agreement shall |
8 |
| immediately retire any emission credits that it |
9 |
| receives in connection with the electricity covered by |
10 |
| such agreement. |
11 |
| (B) Utilities shall maintain adequate records |
12 |
| documenting the purchases under the sourcing agreement |
13 |
| to comply with this subsection (d) and shall file an |
14 |
| accounting with the load forecast that must be filed |
15 |
| with the Agency by July 15 of each year, in accordance |
16 |
| with subsection (d) of Section 16-111.5 of the Public |
17 |
| Utilities Act. |
18 |
| (C) A utility shall be deemed to have complied with |
19 |
| the clean coal portfolio standard specified in this |
20 |
| subsection (d) if the utility enters into a sourcing |
21 |
| agreement as required by this subsection (d). |
22 |
| (2) For purposes of this subsection (d), the required |
23 |
| execution of sourcing agreements with the initial clean |
24 |
| coal facility for a particular year shall be measured as a |
25 |
| percentage of the actual amount of electricity |
26 |
| (megawatt-hours) supplied by the electric utility to |
|
|
|
SB3686 |
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LRB096 20770 MJR 36521 b |
|
|
1 |
| eligible retail customers in the planning year ending |
2 |
| immediately prior to the agreement's execution. For |
3 |
| purposes of this subsection (d), the amount paid per |
4 |
| kilowatthour means the total amount paid for electric |
5 |
| service expressed on a per kilowatthour basis. For purposes |
6 |
| of this subsection (d), the total amount paid for electric |
7 |
| service includes without limitation amounts paid for |
8 |
| supply, transmission, distribution, surcharges and add-on |
9 |
| taxes. |
10 |
| Notwithstanding the requirements of this subsection |
11 |
| (d), the total amount paid under sourcing agreements with |
12 |
| clean coal facilities pursuant to the procurement plan for |
13 |
| any given year shall be reduced by an amount necessary to |
14 |
| limit the annual estimated average net increase due to the |
15 |
| costs of these resources included in the amounts paid by |
16 |
| eligible retail customers in connection with electric |
17 |
| service to: |
18 |
| (A) in 2010, no more than 0.5% of the amount |
19 |
| paid per kilowatthour by those customers during |
20 |
| the year ending May 31, 2009; |
21 |
| (B) in 2011, the greater of an additional 0.5% |
22 |
| of the amount paid per kilowatthour by those |
23 |
| customers during the year ending May 31, 2010 or 1% |
24 |
| of the amount paid per kilowatthour by those |
25 |
| customers during the year ending May 31, 2009; |
26 |
| (C) in 2012, the greater of an additional 0.5% |
|
|
|
SB3686 |
- 24 - |
LRB096 20770 MJR 36521 b |
|
|
1 |
| of the amount paid per kilowatthour by those |
2 |
| customers during the year ending May 31, 2011 or |
3 |
| 1.5% of the amount paid per kilowatthour by those |
4 |
| customers during the year ending May 31, 2009; |
5 |
| (D) in 2013, the greater of an additional 0.5% |
6 |
| of the amount paid per kilowatthour by those |
7 |
| customers during the year ending May 31, 2012 or 2% |
8 |
| of the amount paid per kilowatthour by those |
9 |
| customers during the year ending May 31, 2009; and |
10 |
| (E) thereafter, the total amount paid under |
11 |
| sourcing agreements with clean coal facilities |
12 |
| pursuant to the procurement plan for any single |
13 |
| year shall be reduced by an amount necessary to |
14 |
| limit the estimated average net increase due to the |
15 |
| cost of these resources included in the amounts |
16 |
| paid by eligible retail customers in connection |
17 |
| with electric service to no more than the greater |
18 |
| of (i) 2.015% of the amount paid per kilowatthour |
19 |
| by those customers during the year ending May 31, |
20 |
| 2009 or (ii) the incremental amount per |
21 |
| kilowatthour paid for these resources in 2013. |
22 |
| These requirements may be altered only as provided |
23 |
| by statute.
No later than June 30, 2015, the |
24 |
| Commission shall review the limitation on the |
25 |
| total amount paid under sourcing agreements, if |
26 |
| any, with clean coal facilities pursuant to this |
|
|
|
SB3686 |
- 25 - |
LRB096 20770 MJR 36521 b |
|
|
1 |
| subsection (d) and report to the General Assembly |
2 |
| its findings as to whether that limitation unduly |
3 |
| constrains the amount of electricity generated by |
4 |
| cost-effective clean coal facilities that is |
5 |
| covered by sourcing agreements. |
6 |
| (3) Initial clean coal facility. In order to promote |
7 |
| development of clean coal facilities in Illinois, each |
8 |
| electric utility subject to this Section shall execute a |
9 |
| sourcing agreement to source electricity from a proposed |
10 |
| clean coal facility in Illinois (the "initial clean coal |
11 |
| facility") that will have a nameplate capacity of at least |
12 |
| 500 MW when commercial operation commences, that has a |
13 |
| final Clean Air Act permit on the effective date of this |
14 |
| amendatory Act of the 95th General Assembly, and that will |
15 |
| meet the definition of clean coal facility in Section 1-10 |
16 |
| of this Act when commercial operation commences. The |
17 |
| sourcing agreements with this initial clean coal facility |
18 |
| shall be subject to both approval of the initial clean coal |
19 |
| facility by the General Assembly and satisfaction of the |
20 |
| requirements of paragraph (4) of this subsection (d) and |
21 |
| shall be executed within 90 days after any such approval by |
22 |
| the General Assembly. The Agency and the Commission shall |
23 |
| have authority to inspect all books and records associated |
24 |
| with the initial clean coal facility during the term of |
25 |
| such a sourcing agreement. A utility's sourcing agreement |
26 |
| for electricity produced by the initial clean coal facility |
|
|
|
SB3686 |
- 26 - |
LRB096 20770 MJR 36521 b |
|
|
1 |
| shall include: |
2 |
| (A) a formula contractual price (the "contract |
3 |
| price") approved pursuant to paragraph (4) of this |
4 |
| subsection (d), which shall: |
5 |
| (i) be determined using a cost of service |
6 |
| methodology employing either a level or deferred |
7 |
| capital recovery component, based on a capital |
8 |
| structure consisting of 45% equity and 55% debt, |
9 |
| and a return on equity as may be approved by the |
10 |
| Federal Energy Regulatory Commission, which in any |
11 |
| case may not exceed the lower of 11.5% or the rate |
12 |
| of return approved by the General Assembly |
13 |
| pursuant to paragraph (4) of this subsection (d); |
14 |
| and |
15 |
| (ii) provide that all miscellaneous net |
16 |
| revenue, including but not limited to net revenue |
17 |
| from the sale of emission allowances, if any, |
18 |
| substitute natural gas, if any, grants or other |
19 |
| support provided by the State of Illinois or the |
20 |
| United States Government, firm transmission |
21 |
| rights, if any, by-products produced by the |
22 |
| facility, energy or capacity derived from the |
23 |
| facility and not covered by a sourcing agreement |
24 |
| pursuant to paragraph (3) of this subsection (d) or |
25 |
| item (5) of subsection (d) of Section 16-115 of the |
26 |
| Public Utilities Act, whether generated from the |
|
|
|
SB3686 |
- 27 - |
LRB096 20770 MJR 36521 b |
|
|
1 |
| synthesis gas derived from coal, from SNG, or from |
2 |
| natural gas, shall be credited against the revenue |
3 |
| requirement for this initial clean coal facility; |
4 |
| (B) power purchase provisions, which shall: |
5 |
| (i) provide that the utility party to such |
6 |
| sourcing agreement shall pay the contract price |
7 |
| for electricity delivered under such sourcing |
8 |
| agreement; |
9 |
| (ii) require delivery of electricity to the |
10 |
| regional transmission organization market of the |
11 |
| utility that is party to such sourcing agreement; |
12 |
| (iii) require the utility party to such |
13 |
| sourcing agreement to buy from the initial clean |
14 |
| coal facility in each hour an amount of energy |
15 |
| equal to all clean coal energy made available from |
16 |
| the initial clean coal facility during such hour |
17 |
| times a fraction, the numerator of which is such |
18 |
| utility's retail market sales of electricity |
19 |
| (expressed in kilowatthours sold) in the State |
20 |
| during the prior calendar month and the |
21 |
| denominator of which is the total retail market |
22 |
| sales of electricity (expressed in kilowatthours |
23 |
| sold) in the State by utilities during such prior |
24 |
| month and the sales of electricity (expressed in |
25 |
| kilowatthours sold) in the State by alternative |
26 |
| retail electric suppliers during such prior month |
|
|
|
SB3686 |
- 28 - |
LRB096 20770 MJR 36521 b |
|
|
1 |
| that are subject to the requirements of this |
2 |
| subsection (d) and paragraph (5) of subsection (d) |
3 |
| of Section 16-115 of the Public Utilities Act, |
4 |
| provided that the amount purchased by the utility |
5 |
| in any year will be limited by paragraph (2) of |
6 |
| this subsection (d); and |
7 |
| (iv) be considered pre-existing contracts in |
8 |
| such utility's procurement plans for eligible |
9 |
| retail customers; |
10 |
| (C) contract for differences provisions, which |
11 |
| shall: |
12 |
| (i) require the utility party to such sourcing |
13 |
| agreement to contract with the initial clean coal |
14 |
| facility in each hour with respect to an amount of |
15 |
| energy equal to all clean coal energy made |
16 |
| available from the initial clean coal facility |
17 |
| during such hour times a fraction, the numerator of |
18 |
| which is such utility's retail market sales of |
19 |
| electricity (expressed in kilowatthours sold) in |
20 |
| the utility's service territory in the State |
21 |
| during the prior calendar month and the |
22 |
| denominator of which is the total retail market |
23 |
| sales of electricity (expressed in kilowatthours |
24 |
| sold) in the State by utilities during such prior |
25 |
| month and the sales of electricity (expressed in |
26 |
| kilowatthours sold) in the State by alternative |
|
|
|
SB3686 |
- 29 - |
LRB096 20770 MJR 36521 b |
|
|
1 |
| retail electric suppliers during such prior month |
2 |
| that are subject to the requirements of this |
3 |
| subsection (d) and paragraph (5) of subsection (d) |
4 |
| of Section 16-115 of the Public Utilities Act, |
5 |
| provided that the amount paid by the utility in any |
6 |
| year will be limited by paragraph (2) of this |
7 |
| subsection (d); |
8 |
| (ii) provide that the utility's payment |
9 |
| obligation in respect of the quantity of |
10 |
| electricity determined pursuant to the preceding |
11 |
| clause (i) shall be limited to an amount equal to |
12 |
| (1) the difference between the contract price |
13 |
| determined pursuant to subparagraph (A) of |
14 |
| paragraph (3) of this subsection (d) and the |
15 |
| day-ahead price for electricity delivered to the |
16 |
| regional transmission organization market of the |
17 |
| utility that is party to such sourcing agreement |
18 |
| (or any successor delivery point at which such |
19 |
| utility's supply obligations are financially |
20 |
| settled on an hourly basis) (the "reference |
21 |
| price") on the day preceding the day on which the |
22 |
| electricity is delivered to the initial clean coal |
23 |
| facility busbar, multiplied by (2) the quantity of |
24 |
| electricity determined pursuant to the preceding |
25 |
| clause (i); and |
26 |
| (iii) not require the utility to take physical |
|
|
|
SB3686 |
- 30 - |
LRB096 20770 MJR 36521 b |
|
|
1 |
| delivery of the electricity produced by the |
2 |
| facility; |
3 |
| (D) general provisions, which shall: |
4 |
| (i) specify a term of no more than 30 years, |
5 |
| commencing on the commercial operation date of the |
6 |
| facility; |
7 |
| (ii) provide that utilities shall maintain |
8 |
| adequate records documenting purchases under the |
9 |
| sourcing agreements entered into to comply with |
10 |
| this subsection (d) and shall file an accounting |
11 |
| with the load forecast that must be filed with the |
12 |
| Agency by July 15 of each year, in accordance with |
13 |
| subsection (d) of Section 16-111.5 of the Public |
14 |
| Utilities Act. |
15 |
| (iii) provide that all costs associated with |
16 |
| the initial clean coal facility will be |
17 |
| periodically reported to the Federal Energy |
18 |
| Regulatory Commission and to purchasers in |
19 |
| accordance with applicable laws governing |
20 |
| cost-based wholesale power contracts; |
21 |
| (iv) permit the Illinois Power Agency to |
22 |
| assume ownership of the initial clean coal |
23 |
| facility, without monetary consideration and |
24 |
| otherwise on reasonable terms acceptable to the |
25 |
| Agency, if the Agency so requests no less than 3 |
26 |
| years prior to the end of the stated contract term; |
|
|
|
SB3686 |
- 31 - |
LRB096 20770 MJR 36521 b |
|
|
1 |
| (v) require the owner of the initial clean coal |
2 |
| facility to provide documentation to the |
3 |
| Commission each year, starting in the facility's |
4 |
| first year of commercial operation, accurately |
5 |
| reporting the quantity of carbon emissions from |
6 |
| the facility that have been captured and |
7 |
| sequestered and report any quantities of carbon |
8 |
| released from the site or sites at which carbon |
9 |
| emissions were sequestered in prior years, based |
10 |
| on continuous monitoring of such sites. If, in any |
11 |
| year after the first year of commercial operation, |
12 |
| the owner of the facility fails to demonstrate that |
13 |
| the initial clean coal facility captured and |
14 |
| sequestered at least 50% of the total carbon |
15 |
| emissions that the facility would otherwise emit |
16 |
| or that sequestration of emissions from prior |
17 |
| years has failed, resulting in the release of |
18 |
| carbon dioxide into the atmosphere, the owner of |
19 |
| the facility must offset excess emissions. Any |
20 |
| such carbon offsets must be permanent, additional, |
21 |
| verifiable, real, located within the State of |
22 |
| Illinois, and legally and practicably enforceable. |
23 |
| The cost of such offsets for the facility that are |
24 |
| not recoverable shall not exceed $15 million in any |
25 |
| given year. No costs of any such purchases of |
26 |
| carbon offsets may be recovered from a utility or |
|
|
|
SB3686 |
- 32 - |
LRB096 20770 MJR 36521 b |
|
|
1 |
| its customers. All carbon offsets purchased for |
2 |
| this purpose and any carbon emission credits |
3 |
| associated with sequestration of carbon from the |
4 |
| facility must be permanently retired. The initial |
5 |
| clean coal facility shall not forfeit its |
6 |
| designation as a clean coal facility if the |
7 |
| facility fails to fully comply with the applicable |
8 |
| carbon sequestration requirements in any given |
9 |
| year, provided the requisite offsets are |
10 |
| purchased. However, the Attorney General, on |
11 |
| behalf of the People of the State of Illinois, may |
12 |
| specifically enforce the facility's sequestration |
13 |
| requirement and the other terms of this contract |
14 |
| provision. Compliance with the sequestration |
15 |
| requirements and offset purchase requirements |
16 |
| specified in paragraph (3) of this subsection (d) |
17 |
| shall be reviewed annually by an independent |
18 |
| expert retained by the owner of the initial clean |
19 |
| coal facility, with the advance written approval |
20 |
| of the Attorney General. The Commission may, in the |
21 |
| course of the review specified in item (vii), |
22 |
| reduce the allowable return on equity for the |
23 |
| facility if the facility wilfully fails to comply |
24 |
| with the carbon capture and sequestration |
25 |
| requirements set forth in this item (v); |
26 |
| (vi) include limits on, and accordingly |
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LRB096 20770 MJR 36521 b |
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| provide for modification of, the amount the |
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| utility is required to source under the sourcing |
3 |
| agreement consistent with paragraph (2) of this |
4 |
| subsection (d); |
5 |
| (vii) require Commission review: (1) to |
6 |
| determine the justness, reasonableness, and |
7 |
| prudence of the inputs to the formula referenced in |
8 |
| subparagraphs (A)(i) through (A)(iii) of paragraph |
9 |
| (3) of this subsection (d), prior to an adjustment |
10 |
| in those inputs including, without limitation, the |
11 |
| capital structure and return on equity, fuel |
12 |
| costs, and other operations and maintenance costs |
13 |
| and (2) to approve the costs to be passed through |
14 |
| to customers under the sourcing agreement by which |
15 |
| the utility satisfies its statutory obligations. |
16 |
| Commission review shall occur no less than every 3 |
17 |
| years, regardless of whether any adjustments have |
18 |
| been proposed, and shall be completed within 9 |
19 |
| months; |
20 |
| (viii) limit the utility's obligation to such |
21 |
| amount as the utility is allowed to recover through |
22 |
| tariffs filed with the Commission, provided that |
23 |
| neither the clean coal facility nor the utility |
24 |
| waives any right to assert federal pre-emption or |
25 |
| any other argument in response to a purported |
26 |
| disallowance of recovery costs; |
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LRB096 20770 MJR 36521 b |
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| (ix) limit the utility's or alternative retail |
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| electric supplier's obligation to incur any |
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| liability until such time as the facility is in |
4 |
| commercial operation and generating power and |
5 |
| energy and such power and energy is being delivered |
6 |
| to the facility busbar; |
7 |
| (x) provide that the owner or owners of the |
8 |
| initial clean coal facility, which is the |
9 |
| counterparty to such sourcing agreement, shall |
10 |
| have the right from time to time to elect whether |
11 |
| the obligations of the utility party thereto shall |
12 |
| be governed by the power purchase provisions or the |
13 |
| contract for differences provisions; |
14 |
| (xi) append documentation showing that the |
15 |
| formula rate and contract, insofar as they relate |
16 |
| to the power purchase provisions, have been |
17 |
| approved by the Federal Energy Regulatory |
18 |
| Commission pursuant to Section 205 of the Federal |
19 |
| Power Act; |
20 |
| (xii) provide that any changes to the terms of |
21 |
| the contract, insofar as such changes relate to the |
22 |
| power purchase provisions, are subject to review |
23 |
| under the public interest standard applied by the |
24 |
| Federal Energy Regulatory Commission pursuant to |
25 |
| Sections 205 and 206 of the Federal Power Act; and |
26 |
| (xiii) conform with customary lender |
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LRB096 20770 MJR 36521 b |
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| requirements in power purchase agreements used as |
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| the basis for financing non-utility generators. |
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| (4) Effective date of sourcing agreements with the |
4 |
| initial clean coal facility. Any proposed sourcing |
5 |
| agreement with the initial clean coal facility shall not |
6 |
| become effective unless the following reports are prepared |
7 |
| and submitted and authorizations and approvals obtained: |
8 |
| (i) Facility cost report. The owner of the |
9 |
| initial clean coal facility shall submit to the |
10 |
| Commission, the Agency, and the General Assembly a |
11 |
| front-end engineering and design study, a facility |
12 |
| cost report, method of financing (including but |
13 |
| not limited to structure and associated costs), |
14 |
| and an operating and maintenance cost quote for the |
15 |
| facility (collectively "facility cost report"), |
16 |
| which shall be prepared in accordance with the |
17 |
| requirements of this paragraph (4) of subsection |
18 |
| (d) of this Section, and shall provide the |
19 |
| Commission and the Agency access to the work |
20 |
| papers, relied upon documents, and any other |
21 |
| backup documentation related to the facility cost |
22 |
| report. |
23 |
| (ii) Commission report. Within 6 months |
24 |
| following receipt of the facility cost report, the |
25 |
| Commission, in consultation with the Agency, shall |
26 |
| submit a report to the General Assembly setting |
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LRB096 20770 MJR 36521 b |
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| forth its analysis of the facility cost report. |
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| Such report shall include, but not be limited to, a |
3 |
| comparison of the costs associated with |
4 |
| electricity generated by the initial clean coal |
5 |
| facility to the costs associated with electricity |
6 |
| generated by other types of generation facilities, |
7 |
| an analysis of the rate impacts on residential and |
8 |
| small business customers over the life of the |
9 |
| sourcing agreements, and an analysis of the |
10 |
| likelihood that the initial clean coal facility |
11 |
| will commence commercial operation by and be |
12 |
| delivering power to the facility's busbar by 2016. |
13 |
| To assist in the preparation of its report, the |
14 |
| Commission, in consultation with the Agency, may |
15 |
| hire one or more experts or consultants, the costs |
16 |
| of which shall be paid for by the owner of the |
17 |
| initial clean coal facility. The Commission and |
18 |
| Agency may begin the process of selecting such |
19 |
| experts or consultants prior to receipt of the |
20 |
| facility cost report. |
21 |
| (iii) General Assembly approval. The proposed |
22 |
| sourcing agreements shall not take effect unless, |
23 |
| based on the facility cost report and the |
24 |
| Commission's report, the General Assembly enacts |
25 |
| authorizing legislation approving (A) the |
26 |
| projected price, stated in cents per kilowatthour, |
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LRB096 20770 MJR 36521 b |
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| to be charged for electricity generated by the |
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| initial clean coal facility, (B) the projected |
3 |
| impact on residential and small business |
4 |
| customers' bills over the life of the sourcing |
5 |
| agreements, and (C) the maximum allowable return |
6 |
| on equity for the project; and |
7 |
| (iv) Commission review. If the General |
8 |
| Assembly enacts authorizing legislation pursuant |
9 |
| to subparagraph (iii) approving a sourcing |
10 |
| agreement, the Commission shall, within 90 days of |
11 |
| such enactment, complete a review of such sourcing |
12 |
| agreement. During such time period, the Commission |
13 |
| shall implement any directive of the General |
14 |
| Assembly, resolve any disputes between the parties |
15 |
| to the sourcing agreement concerning the terms of |
16 |
| such agreement, approve the form of such |
17 |
| agreement, and issue an order finding that the |
18 |
| sourcing agreement is prudent and reasonable. |
19 |
| The facility cost report shall be prepared as follows: |
20 |
| (A) The facility cost report shall be prepared by |
21 |
| duly licensed engineering and construction firms |
22 |
| detailing the estimated capital costs payable to one or |
23 |
| more contractors or suppliers for the engineering, |
24 |
| procurement and construction of the components |
25 |
| comprising the initial clean coal facility and the |
26 |
| estimated costs of operation and maintenance of the |
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SB3686 |
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LRB096 20770 MJR 36521 b |
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| facility. The facility cost report shall include: |
2 |
| (i) an estimate of the capital cost of the core |
3 |
| plant based on one or more front end engineering |
4 |
| and design studies for the gasification island and |
5 |
| related facilities. The core plant shall include |
6 |
| all civil, structural, mechanical, electrical, |
7 |
| control, and safety systems. |
8 |
| (ii) an estimate of the capital cost of the |
9 |
| balance of the plant, including any capital costs |
10 |
| associated with sequestration of carbon dioxide |
11 |
| emissions and all interconnects and interfaces |
12 |
| required to operate the facility, such as |
13 |
| transmission of electricity, construction or |
14 |
| backfeed power supply, pipelines to transport |
15 |
| substitute natural gas or carbon dioxide, potable |
16 |
| water supply, natural gas supply, water supply, |
17 |
| water discharge, landfill, access roads, and coal |
18 |
| delivery. |
19 |
| The quoted construction costs shall be expressed |
20 |
| in nominal dollars as of the date that the quote is |
21 |
| prepared and shall include (1) capitalized financing |
22 |
| costs during construction,
(2) taxes, insurance, and |
23 |
| other owner's costs, and (3) an assumed escalation in |
24 |
| materials and labor beyond the date as of which the |
25 |
| construction cost quote is expressed. |
26 |
| (B) The front end engineering and design study for |
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SB3686 |
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LRB096 20770 MJR 36521 b |
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| the gasification island and the cost study for the |
2 |
| balance of plant shall include sufficient design work |
3 |
| to permit quantification of major categories of |
4 |
| materials, commodities and labor hours, and receipt of |
5 |
| quotes from vendors of major equipment required to |
6 |
| construct and operate the clean coal facility. |
7 |
| (C) The facility cost report shall also include an |
8 |
| operating and maintenance cost quote that will provide |
9 |
| the estimated cost of delivered fuel, personnel, |
10 |
| maintenance contracts, chemicals, catalysts, |
11 |
| consumables, spares, and other fixed and variable |
12 |
| operations and maintenance costs. |
13 |
| (a) The delivered fuel cost estimate will be |
14 |
| provided by a recognized third party expert or |
15 |
| experts in the fuel and transportation industries. |
16 |
| (b) The balance of the operating and |
17 |
| maintenance cost quote, excluding delivered fuel |
18 |
| costs will be developed based on the inputs |
19 |
| provided by duly licensed engineering and |
20 |
| construction firms performing the construction |
21 |
| cost quote, potential vendors under long-term |
22 |
| service agreements and plant operating agreements, |
23 |
| or recognized third party plant operator or |
24 |
| operators. |
25 |
| The operating and maintenance cost quote |
26 |
| (including the cost of the front end engineering |
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SB3686 |
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LRB096 20770 MJR 36521 b |
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|
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| and design study) shall be expressed in nominal |
2 |
| dollars as of the date that the quote is prepared |
3 |
| and shall include (1) taxes, insurance, and other |
4 |
| owner's costs, and (2) an assumed escalation in |
5 |
| materials and labor beyond the date as of which the |
6 |
| operating and maintenance cost quote is expressed. |
7 |
| (D) The facility cost report shall also include (i) |
8 |
| an analysis of the initial clean coal facility's |
9 |
| ability to deliver power and energy into the applicable |
10 |
| regional transmission organization markets and (ii) an |
11 |
| analysis of the expected capacity factor for the |
12 |
| initial clean coal facility. |
13 |
| (E) Amounts paid to third parties unrelated to the |
14 |
| owner or owners of the initial clean coal facility to |
15 |
| prepare the core plant construction cost quote, |
16 |
| including the front end engineering and design study, |
17 |
| and the operating and maintenance cost quote will be |
18 |
| reimbursed through Coal Development Bonds. |
19 |
| (5) Re-powering and retrofitting coal-fired power |
20 |
| plants previously owned by Illinois utilities to qualify as |
21 |
| clean coal facilities. During the 2009 procurement |
22 |
| planning process and thereafter, the Agency and the |
23 |
| Commission shall consider sourcing agreements covering |
24 |
| electricity generated by power plants that were previously |
25 |
| owned by Illinois utilities and that have been or will be |
26 |
| converted into clean coal facilities, as defined by Section |
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SB3686 |
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LRB096 20770 MJR 36521 b |
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|
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| 1-10 of this Act. Pursuant to such procurement planning |
2 |
| process, the owners of such facilities may propose to the |
3 |
| Agency sourcing agreements with utilities and alternative |
4 |
| retail electric suppliers required to comply with |
5 |
| subsection (d) of this Section and item (5) of subsection |
6 |
| (d) of Section 16-115 of the Public Utilities Act, covering |
7 |
| electricity generated by such facilities. In the case of |
8 |
| sourcing agreements that are power purchase agreements, |
9 |
| the contract price for electricity sales shall be |
10 |
| established on a cost of service basis. In the case of |
11 |
| sourcing agreements that are contracts for differences, |
12 |
| the contract price from which the reference price is |
13 |
| subtracted shall be established on a cost of service basis. |
14 |
| The Agency and the Commission may approve any such utility |
15 |
| sourcing agreements that do not exceed cost-based |
16 |
| benchmarks developed by the procurement administrator, in |
17 |
| consultation with the Commission staff, Agency staff and |
18 |
| the procurement monitor, subject to Commission review and |
19 |
| approval. The Commission shall have authority to inspect |
20 |
| all books and records associated with these clean coal |
21 |
| facilities during the term of any such contract. |
22 |
| (6) Costs incurred under this subsection (d) or |
23 |
| pursuant to a contract entered into under this subsection |
24 |
| (d) shall be deemed prudently incurred and reasonable in |
25 |
| amount and the electric utility shall be entitled to full |
26 |
| cost recovery pursuant to the tariffs filed with the |
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|
SB3686 |
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LRB096 20770 MJR 36521 b |
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|
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| Commission. |
2 |
| (e) The draft procurement plans are subject to public |
3 |
| comment, as required by Section 16-111.5 of the Public |
4 |
| Utilities Act. |
5 |
| (f) The Agency shall submit the final procurement plan |
6 |
| to the Commission. The Agency shall revise a procurement |
7 |
| plan if the Commission determines that it does not meet the |
8 |
| standards set forth in Section 16-111.5 of the Public |
9 |
| Utilities Act. |
10 |
| (g) The Agency shall assess fees to each affected |
11 |
| utility to recover the costs incurred in preparation of the |
12 |
| annual procurement plan for the utility. |
13 |
| (h) The Agency shall assess fees to each bidder to |
14 |
| recover the costs incurred in connection with a competitive |
15 |
| procurement process.
|
16 |
| (Source: P.A. 95-481, eff. 8-28-07; 95-1027, eff. 6-1-09; |
17 |
| 96-159, eff. 8-10-09.)
|
18 |
| Section 99. Effective date. This Act takes effect upon |
19 |
| becoming law.
|