HB2494 EngrossedLRB098 08122 JLS 38213 b

1    AN ACT concerning regulation.
 
2    Be it enacted by the People of the State of Illinois,
3represented in the General Assembly:
 
4    Section 5. The Public Utilities Act is amended by changing
5Section 19-140 as follows:
 
6    (220 ILCS 5/19-140)
7    Sec. 19-140. On-bill financing program; gas utilities.
8    (a) The Illinois General Assembly finds that Illinois homes
9and businesses have the potential to save energy through
10conservation and cost-effective energy efficiency measures.
11Programs created pursuant to this Section will allow utility
12customers to purchase cost-effective energy efficiency
13measures, including measures set forth in a
14Commission-approved energy efficiency and demand-response plan
15under Section 8-104 of this Act and that are cost-effective as
16that term is defined by that Section, with no required initial
17upfront payment, and to pay the cost of those products and
18services over time on their utility bill.
19    (b) Notwithstanding any other provision of this Act, a gas
20utility serving more than 100,000 customers on January 1, 2009
21shall offer a Commission-approved on-bill financing program
22("program") that allows its retail customers who own a
23residential single family home, duplex, or other residential

 

 

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1building with 4 or less units, or condominium at which the gas
2service is being provided (i) to borrow funds from a third
3party lender in order to purchase gas energy efficiency
4measures approved under the program for installation in such
5home or condominium without any required upfront payment and
6(ii) to pay back such funds over time through the gas utility's
7bill. Based upon the process described in subsection (b-5) of
8this Section, small commercial retail customers, as that term
9is defined in Section 19-105 of this Act, who own the premises
10at which gas service is being provided may be included in such
11program. After receiving a request from a gas utility for
12approval of a proposed program and tariffs pursuant to this
13Section, the Commission shall render its decision within 120
14days. If no decision is rendered within 120 days, then the
15request shall be deemed to be approved.
16    (b-5) Within 30 days after the effective date of this
17amendatory Act of the 96th General Assembly, the Commission
18shall convene a workshop process during which interested
19participants may discuss issues related to the program,
20including program design, eligible gas energy efficiency
21measures, vendor qualifications, and a methodology for
22ensuring ongoing compliance with such qualifications,
23financing, sample documents such as request for proposals,
24contracts and agreements, dispute resolution, pre-installment
25and post-installment verification, and evaluation. The
26workshop process shall be completed within 150 days after the

 

 

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1effective date of this amendatory Act of the 96th General
2Assembly.
3    (c) Not later than 60 days following completion of the
4workshop process described in subsection (b-5) of this Section,
5each gas utility subject to subsection (b) of this Section
6shall submit a proposed program to the Commission that contains
7the following components:
8        (1) A list of recommended gas energy efficiency
9    measures that will be eligible for on-bill financing. An
10    eligible gas energy efficiency measure ("measure") shall
11    be defined by the following:
12            (A) The measure would be applied to or replace gas
13        energy-using equipment; and
14            (B) Either (i) application Application of the
15        measure to equipment and systems will have estimated
16        gas savings (determined by rates in effect at the time
17        of purchase), that are sufficient to cover the costs of
18        implementing the measures, including finance charges
19        and any program fees not recovered pursuant to
20        subsection (f) of this Section. To assist the gas
21        utility in identifying or approving measures, the
22        utility may consult with the Department of Commerce and
23        Economic Opportunity, as well as with retailers,
24        technicians and installers of gas energy efficiency
25        measures and energy auditors (collectively "vendors");
26        or (ii) the measure is included in a

 

 

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1        Commission-approved energy efficiency and
2        demand-response plan under Section 8-104 of this Act
3        and is cost-effective as that term is defined by that
4        Section.
5        (2) The gas utility shall issue a request for proposals
6    ("RFP") to lenders for purposes of providing financing to
7    participants to pay for approved measures. The RFP criteria
8    shall include, but not be limited to, the interest rate,
9    origination fees, and credit terms. The utility shall
10    select the winning bidders based on its evaluation of these
11    criteria, with a preference for those bids containing the
12    rates, fees, and terms most favorable to participants.
13        (3) The utility shall work with the lenders selected
14    pursuant to the RFP process, and with vendors, to establish
15    the terms and processes pursuant to which a participant can
16    purchase eligible gas energy efficiency measures using the
17    financing obtained from the lender. The vendor shall
18    explain and offer the approved financing packaging to those
19    customers identified in subsection (b) of this Section and
20    shall assist customers in applying for financing. As part
21    of such process, vendors shall also provide to participants
22    information about any other incentives that may be
23    available for the measures.
24        (4) The lender shall conduct credit checks or undertake
25    other appropriate measures to limit credit risk, and shall
26    review and approve or deny financing applications

 

 

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1    submitted by customers identified in subsection (b) of this
2    Section. Following the lender's approval of financing and
3    the participant's purchase of the measure or measures, the
4    lender shall forward payment information to the gas
5    utility, and the utility shall add as a separate line item
6    on the participant's utility bill a charge showing the
7    amount due under the program each month.
8        (5) A loan issued to a participant pursuant to the
9    program shall be the sole responsibility of the
10    participant, and any dispute that may arise concerning the
11    loan's terms, conditions, or charges shall be resolved
12    between the participant and lender. Upon transfer of the
13    property title for the premises at which the participant
14    receives gas service from the utility or the participant's
15    request to terminate service at such premises, the
16    participant shall pay in full its gas utility bill,
17    including all amounts due under the program, provided that
18    this obligation may be modified as provided in subsection
19    (g) of this Section. Amounts due under the program shall be
20    deemed amounts owed for residential and, as appropriate,
21    small commercial gas service.
22        (6) The gas utility shall remit payment in full to the
23    lender each month on behalf of the participant. In the
24    event a participant defaults on payment of its gas utility
25    bill, the gas utility shall continue to remit all payments
26    due under the program to the lender, and the utility shall

 

 

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1    be entitled to recover all costs related to a participant's
2    nonpayment through the automatic adjustment clause tariff
3    established pursuant to Section 19-145 of this Act. In
4    addition, the gas utility shall retain a security interest
5    in the measure or measures purchased under the program, and
6    the utility retains its right to disconnect a participant
7    that defaults on the payment of its utility bill.
8        (7) The total outstanding amount financed under the
9    program shall not exceed $2.5 million for a gas utility or
10    gas utilities under a single holding company, provided that
11    the gas utility or gas utilities may petition the
12    Commission for an increase in such amount.
13    (d) A program approved by the Commission shall also include
14the following criteria and guidelines for such program:
15        (1) guidelines for financing of measures installed
16    under a program, including, but not limited to, RFP
17    criteria and limits on both individual loan amounts and the
18    duration of the loans;
19        (2) criteria and standards for identifying and
20    approving measures;
21        (3) qualifications of vendors that will market or
22    install measures, as well as a methodology for ensuring
23    ongoing compliance with such qualifications;
24        (4) sample contracts and agreements necessary to
25    implement the measures and program; and
26        (5) the types of data and information that utilities

 

 

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1    and vendors participating in the program shall collect for
2    purposes of preparing the reports required under
3    subsection (g) of this Section.
4    (e) The proposed program submitted by each gas utility
5shall be consistent with the provisions of this Section that
6define operational, financial, and billing arrangements
7between and among program participants, vendors, lenders, and
8the gas utility.
9    (f) A gas utility shall recover all of the prudently
10incurred costs of offering a program approved by the Commission
11pursuant to this Section, including, but not limited to, all
12start-up and administrative costs and the costs for program
13evaluation. All prudently incurred costs under this Section
14shall be recovered from the residential and small commercial
15retail customer classes eligible to participate in the program
16through the automatic adjustment clause tariff established
17pursuant to Section 8-104 of this Act.
18    (g) An independent evaluation of a program shall be
19conducted after 3 years of the program's operation. The gas
20utility shall retain an independent evaluator who shall
21evaluate the effects of the measures installed under the
22program and the overall operation of the program, including,
23but not limited to, customer eligibility criteria and whether
24the payment obligation for permanent gas energy efficiency
25measures that will continue to provide benefits of energy
26savings should attach to the meter location. As part of the

 

 

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1evaluation process, the evaluator shall also solicit feedback
2from participants and interested stakeholders. The evaluator
3shall issue a report to the Commission on its findings no later
4than 4 years after the date on which the program commenced, and
5the Commission shall issue a report to the Governor and General
6Assembly including a summary of the information described in
7this Section as well as its recommendations as to whether the
8program should be discontinued, continued with modification or
9modifications or continued without modification, provided that
10any recommended modifications shall only apply prospectively
11and to measures not yet installed or financed.
12    (h) A gas utility offering a Commission-approved program
13pursuant to this Section shall not be required to comply with
14any other statute, order, rule, or regulation of this State
15that may relate to the offering of such program, provided that
16nothing in this Section is intended to limit the gas utility's
17obligation to comply with this Act and the Commission's orders,
18rules, and regulations, including Part 280 of Title 83 of the
19Illinois Administrative Code.
20    (i) The source of a utility customer's gas supply shall not
21disqualify a customer from participation in the utility's
22on-bill financing program. Customers of alternative gas
23suppliers may participate in the program under the same terms
24and conditions applicable to the utility's supply customers.
25(Source: P.A. 96-33, eff. 7-10-09.)