Illinois General Assembly - Full Text of SB2365
Illinois General Assembly

Previous General Assemblies

Full Text of SB2365  98th General Assembly

SB2365sam002 98TH GENERAL ASSEMBLY

Sen. Don Harmon

Filed: 4/15/2013

 

 


 

 


 
09800SB2365sam002LRB098 06614 CEL 44664 a

1
AMENDMENT TO SENATE BILL 2365

2    AMENDMENT NO. ______. Amend Senate Bill 2365 by replacing
3everything after the enacting clause with the following:
 
4    "Section 5. The Illinois Finance Authority Act is amended
5by changing Section 825-65 as follows:
 
6    (20 ILCS 3501/825-65)
7    Sec. 825-65. Clean Coal, Coal, Energy Efficiency, and
8Renewable Energy Project Financing.
9    (a) Findings and declaration of policy.
10        (i) It is hereby found and declared that Illinois has
11    abundant coal resources and, in some areas of Illinois, the
12    demand for power exceeds the generating capacity.
13    Incentives to encourage the construction of coal-fueled
14    electric generating plants in Illinois to ensure power
15    generating capacity into the future and to advance clean
16    coal technology and the use of Illinois coal are in the

 

 

09800SB2365sam002- 2 -LRB098 06614 CEL 44664 a

1    best interests of all of the citizens of Illinois.
2        (ii) It is further found and declared that Illinois has
3    abundant potential and resources to develop renewable
4    energy resource projects and that there are many
5    opportunities to invest in cost-effective energy
6    efficiency projects throughout the State. The development
7    of those projects will create jobs and investment as well
8    as decrease environmental impacts and promote energy
9    independence in Illinois. Accordingly, the development of
10    those projects is in the best interests of all of the
11    citizens of Illinois.
12        (iii) The Authority is authorized to issue bonds to
13    help finance Clean Coal, Coal, Energy Efficiency, and
14    Renewable Energy projects pursuant to this Section.
15    (b) Definitions.
16        (i) "Clean Coal Project" means (A) "clean coal
17    facility", as defined in Section 1-10 of the Illinois Power
18    Agency Act; (B) "clean coal SNG facility", as defined in
19    Section 1-10 of the Illinois Power Agency Act; (C)
20    transmission lines and associated equipment that transfer
21    electricity from points of supply to points of delivery for
22    projects described in this subsection (b); (D) pipelines or
23    other methods to transfer carbon dioxide from the point of
24    production to the point of storage or sequestration for
25    projects described in this subsection (b); or (E) projects
26    to provide carbon abatement technology for existing

 

 

09800SB2365sam002- 3 -LRB098 06614 CEL 44664 a

1    generating facilities.
2        (ii) "Coal Project" means new electric generating
3    facilities or new gasification facilities, as defined in
4    Section 605-332 of the Department of Commerce and Economic
5    Opportunity Law of the Civil Administrative Code of
6    Illinois, which may include mine-mouth power plants,
7    projects that employ the use of clean coal technology,
8    projects to provide scrubber technology for existing
9    energy generating plants, or projects to provide electric
10    transmission facilities or new gasification facilities.
11        (iii) "Energy Efficiency Project" means measures that
12    reduce the amount of electricity or natural gas required to
13    achieve a given end use, consistent with Section 1-10 of
14    the Illinois Power Agency Act. "Energy Efficiency Project"
15    also includes measures that reduce the total Btus of
16    electricity and natural gas needed to meet the end use or
17    uses consistent with Section 1-10 of the Illinois Power
18    Agency Act.
19        (iv) "Renewable Energy Project" means (A) a project
20    that uses renewable energy resources, as defined in Section
21    1-10 of the Illinois Power Agency Act; (B) a project that
22    uses environmentally preferable technologies and practices
23    that result in improvements to the production of renewable
24    fuels, including but not limited to, cellulosic
25    conversion, water and energy conservation, fractionation,
26    alternative feedstocks, or reduced green house gas

 

 

09800SB2365sam002- 4 -LRB098 06614 CEL 44664 a

1    emissions; (C) transmission lines and associated equipment
2    that transfer electricity from points of supply to points
3    of delivery for projects described in this subsection (b);
4    or (D) projects that use technology for the storage of
5    renewable energy, including, without limitation, the use
6    of battery or electrochemical storage technology for
7    mobile or stationary applications.
8    (c) Creation of reserve funds. The Authority may establish
9and maintain one or more reserve funds to enhance bonds issued
10by the Authority for a Clean Coal Project, a Coal Project, an
11Energy Efficiency Project, or a Renewable Energy Project. There
12may be one or more accounts in these reserve funds in which
13there may be deposited:
14        (1) any proceeds of the bonds issued by the Authority
15    required to be deposited therein by the terms of any
16    contract between the Authority and its bondholders or any
17    resolution of the Authority;
18        (2) any other moneys or funds of the Authority that it
19    may determine to deposit therein from any other source; and
20        (3) any other moneys or funds made available to the
21    Authority. Subject to the terms of any pledge to the owners
22    of any bonds, moneys in any reserve fund may be held and
23    applied to the payment of principal, premium, if any, and
24    interest of such bonds.
25    (d) Powers and duties. The Authority has the power:
26        (1) To issue bonds in one or more series pursuant to

 

 

09800SB2365sam002- 5 -LRB098 06614 CEL 44664 a

1    one or more resolutions of the Authority for any Clean Coal
2    Project, Coal Project, Energy Efficiency Project, or
3    Renewable Energy Project authorized under this Section,
4    within the authorization set forth in subsection (e).
5        (2) To provide for the funding of any reserves or other
6    funds or accounts deemed necessary by the Authority in
7    connection with any bonds issued by the Authority.
8        (3) To pledge any funds of the Authority or funds made
9    available to the Authority that may be applied to such
10    purpose as security for any bonds or any guarantees,
11    letters of credit, insurance contracts or similar credit
12    support or liquidity instruments securing the bonds.
13        (4) To enter into agreements or contracts with third
14    parties, whether public or private, including, without
15    limitation, the United States of America, the State or any
16    department or agency thereof, to obtain any
17    appropriations, grants, loans or guarantees that are
18    deemed necessary or desirable by the Authority. Any such
19    guarantee, agreement or contract may contain terms and
20    provisions necessary or desirable in connection with the
21    program, subject to the requirements established by the
22    Act.
23        (5) To exercise such other powers as are necessary or
24    incidental to the foregoing.
25    (e) Clean Coal Project, Coal Project, Energy Efficiency
26Project, and Renewable Energy Project bond authorization and

 

 

09800SB2365sam002- 6 -LRB098 06614 CEL 44664 a

1financing limits. In addition to any other bonds authorized to
2be issued under Sections 801-40(w), 825-60, 830-25 and 845-5,
3the Authority may have outstanding, at any time, bonds for the
4purpose enumerated in this Section 825-65 in an aggregate
5principal amount that shall not exceed $3,000,000,000, subject
6to the following limitations: (i) up to $300,000,000 may be
7issued to finance projects, as described in clause (C) of
8subsection (b)(i) and clause (C) of subsection (b)(iv) of this
9Section 825-65; (ii) up to $500,000,000 may be issued to
10finance projects, as described in clauses (D) and (E) of
11subsection (b)(i) of this Section 825-65; (iii) up to
12$2,000,000,000 may be issued to finance Clean Coal Projects, as
13described in clauses (A) and (B) of subsection (b)(i) of this
14Section 825-65 and Coal Projects, as described in subsection
15(b)(ii) of this Section 825-65; and (iv) up to $2,000,000,000
16may be issued to finance Energy Efficiency Projects, as
17described in subsection (b)(iii) of this Section 825-65 and
18Renewable Energy Projects, as described in clauses (A), (B),
19and (D) of subsection (b)(iii) of this Section 825-65. An
20application for a loan financed from bond proceeds from a
21borrower or its affiliates for a Clean Coal Project, a Coal
22Project, Energy Efficiency Project, or a Renewable Energy
23Project may not be approved by the Authority for an amount in
24excess of $450,000,000 for any borrower or its affiliates.
25These bonds shall not constitute an indebtedness or obligation
26of the State of Illinois and it shall be plainly stated on the

 

 

09800SB2365sam002- 7 -LRB098 06614 CEL 44664 a

1face of each bond that it does not constitute an indebtedness
2or obligation of the State of Illinois, but is payable solely
3from the revenues, income or other assets of the Authority
4pledged therefor.
5    (f) The bonding authority granted under this Section is in
6addition to and not limited by the provisions of Section 845-5.
7(Source: P.A. 95-470, eff. 8-27-07; 96-103, eff. 1-1-10;
896-817, eff. 1-1-10.)
 
9    Section 10. The Illinois Power Agency Act is amended by
10changing Section 1-10 as follows:
 
11    (20 ILCS 3855/1-10)
12    Sec. 1-10. Definitions.
13    "Agency" means the Illinois Power Agency.
14    "Agency loan agreement" means any agreement pursuant to
15which the Illinois Finance Authority agrees to loan the
16proceeds of revenue bonds issued with respect to a project to
17the Agency upon terms providing for loan repayment installments
18at least sufficient to pay when due all principal of, interest
19and premium, if any, on those revenue bonds, and providing for
20maintenance, insurance, and other matters in respect of the
21project.
22    "Authority" means the Illinois Finance Authority.
23    "Clean coal facility" means an electric generating
24facility that uses primarily coal as a feedstock and that

 

 

09800SB2365sam002- 8 -LRB098 06614 CEL 44664 a

1captures and sequesters carbon dioxide emissions at the
2following levels: at least 50% of the total carbon dioxide
3emissions that the facility would otherwise emit if, at the
4time construction commences, the facility is scheduled to
5commence operation before 2016, at least 70% of the total
6carbon dioxide emissions that the facility would otherwise emit
7if, at the time construction commences, the facility is
8scheduled to commence operation during 2016 or 2017, and at
9least 90% of the total carbon dioxide emissions that the
10facility would otherwise emit if, at the time construction
11commences, the facility is scheduled to commence operation
12after 2017. The power block of the clean coal facility shall
13not exceed allowable emission rates for sulfur dioxide,
14nitrogen oxides, carbon monoxide, particulates and mercury for
15a natural gas-fired combined-cycle facility the same size as
16and in the same location as the clean coal facility at the time
17the clean coal facility obtains an approved air permit. All
18coal used by a clean coal facility shall have high volatile
19bituminous rank and greater than 1.7 pounds of sulfur per
20million btu content, unless the clean coal facility does not
21use gasification technology and was operating as a conventional
22coal-fired electric generating facility on June 1, 2009 (the
23effective date of Public Act 95-1027).
24    "Clean coal SNG brownfield facility" means a facility that
25(1) has commenced construction by July 1, 2015 on an urban
26brownfield site in a municipality with at least 1,000,000

 

 

09800SB2365sam002- 9 -LRB098 06614 CEL 44664 a

1residents; (2) uses a gasification process to produce
2substitute natural gas; (3) uses coal as at least 50% of the
3total feedstock over the term of any sourcing agreement with a
4utility and the remainder of the feedstock may be either
5petroleum coke or coal, with all such coal having a high
6bituminous rank and greater than 1.7 pounds of sulfur per
7million Btu content unless the facility reasonably determines
8that it is necessary to use additional petroleum coke to
9deliver additional consumer savings, in which case the facility
10shall use coal for at least 35% of the total feedstock over the
11term of any sourcing agreement; and (4) captures and sequesters
12at least 85% of the total carbon dioxide emissions that the
13facility would otherwise emit.
14    "Clean coal SNG facility" means a facility that uses a
15gasification process to produce substitute natural gas, that
16sequesters at least 90% of the total carbon dioxide emissions
17that the facility would otherwise emit, that uses at least 90%
18coal as a feedstock, with all such coal having a high
19bituminous rank and greater than 1.7 pounds of sulfur per
20million btu content, and that has a valid and effective permit
21to construct emission sources and air pollution control
22equipment and approval with respect to the federal regulations
23for Prevention of Significant Deterioration of Air Quality
24(PSD) for the plant pursuant to the federal Clean Air Act;
25provided, however, a clean coal SNG brownfield facility shall
26not be a clean coal SNG facility.

 

 

09800SB2365sam002- 10 -LRB098 06614 CEL 44664 a

1    "Commission" means the Illinois Commerce Commission.
2    "Costs incurred in connection with the development and
3construction of a facility" means:
4        (1) the cost of acquisition of all real property,
5    fixtures, and improvements in connection therewith and
6    equipment, personal property, and other property, rights,
7    and easements acquired that are deemed necessary for the
8    operation and maintenance of the facility;
9        (2) financing costs with respect to bonds, notes, and
10    other evidences of indebtedness of the Agency;
11        (3) all origination, commitment, utilization,
12    facility, placement, underwriting, syndication, credit
13    enhancement, and rating agency fees;
14        (4) engineering, design, procurement, consulting,
15    legal, accounting, title insurance, survey, appraisal,
16    escrow, trustee, collateral agency, interest rate hedging,
17    interest rate swap, capitalized interest, contingency, as
18    required by lenders, and other financing costs, and other
19    expenses for professional services; and
20        (5) the costs of plans, specifications, site study and
21    investigation, installation, surveys, other Agency costs
22    and estimates of costs, and other expenses necessary or
23    incidental to determining the feasibility of any project,
24    together with such other expenses as may be necessary or
25    incidental to the financing, insuring, acquisition, and
26    construction of a specific project and starting up,

 

 

09800SB2365sam002- 11 -LRB098 06614 CEL 44664 a

1    commissioning, and placing that project in operation.
2    "Department" means the Department of Commerce and Economic
3Opportunity.
4    "Director" means the Director of the Illinois Power Agency.
5    "Demand-response" means measures that decrease peak
6electricity demand or shift demand from peak to off-peak
7periods.
8    "Distributed renewable energy generation device" means a
9device that is:
10        (1) powered by wind, solar thermal energy,
11    photovoltaic cells and panels, biodiesel, crops and
12    untreated and unadulterated organic waste biomass, tree
13    waste, and hydropower that does not involve new
14    construction or significant expansion of hydropower dams;
15        (2) interconnected at the distribution system level of
16    either an electric utility as defined in this Section, an
17    alternative retail electric supplier as defined in Section
18    16-102 of the Public Utilities Act, a municipal utility as
19    defined in Section 3-105 of the Public Utilities Act, or a
20    rural electric cooperative as defined in Section 3-119 of
21    the Public Utilities Act;
22        (3) located on the customer side of the customer's
23    electric meter and is primarily used to offset that
24    customer's electricity load; and
25        (4) limited in nameplate capacity to no more than 2,000
26    kilowatts.

 

 

09800SB2365sam002- 12 -LRB098 06614 CEL 44664 a

1    "Energy efficiency" means measures that reduce the amount
2of electricity or natural gas required to achieve a given end
3use. "Energy efficiency" also includes measures that reduce the
4total Btus of electricity and natural gas needed to meet the
5end use or uses.
6    "Electric utility" has the same definition as found in
7Section 16-102 of the Public Utilities Act.
8    "Facility" means an electric generating unit or a
9co-generating unit that produces electricity along with
10related equipment necessary to connect the facility to an
11electric transmission or distribution system.
12    "Governmental aggregator" means one or more units of local
13government that individually or collectively procure
14electricity to serve residential retail electrical loads
15located within its or their jurisdiction.
16    "Local government" means a unit of local government as
17defined in Section 1 of Article VII of the Illinois
18Constitution.
19    "Municipality" means a city, village, or incorporated
20town.
21    "Person" means any natural person, firm, partnership,
22corporation, either domestic or foreign, company, association,
23limited liability company, joint stock company, or association
24and includes any trustee, receiver, assignee, or personal
25representative thereof.
26    "Project" means the planning, bidding, and construction of

 

 

09800SB2365sam002- 13 -LRB098 06614 CEL 44664 a

1a facility.
2    "Public utility" has the same definition as found in
3Section 3-105 of the Public Utilities Act.
4    "Real property" means any interest in land together with
5all structures, fixtures, and improvements thereon, including
6lands under water and riparian rights, any easements,
7covenants, licenses, leases, rights-of-way, uses, and other
8interests, together with any liens, judgments, mortgages, or
9other claims or security interests related to real property.
10    "Renewable energy credit" means a tradable credit that
11represents the environmental attributes of a certain amount of
12energy produced from a renewable energy resource.
13    "Renewable energy resources" includes energy and its
14associated renewable energy credit or renewable energy credits
15from wind, solar thermal energy, photovoltaic cells and panels,
16biodiesel, anaerobic digestion, crops and untreated and
17unadulterated organic waste biomass, tree waste, hydropower
18that does not involve new construction or significant expansion
19of hydropower dams, and other alternative sources of
20environmentally preferable energy. For purposes of this Act,
21landfill gas produced in the State is considered a renewable
22energy resource. "Renewable energy resources" does not include
23the incineration or burning of tires, garbage, general
24household, institutional, and commercial waste, industrial
25lunchroom or office waste, landscape waste other than tree
26waste, railroad crossties, utility poles, or construction or

 

 

09800SB2365sam002- 14 -LRB098 06614 CEL 44664 a

1demolition debris, other than untreated and unadulterated
2waste wood.
3    "Revenue bond" means any bond, note, or other evidence of
4indebtedness issued by the Authority, the principal and
5interest of which is payable solely from revenues or income
6derived from any project or activity of the Agency.
7    "Sequester" means permanent storage of carbon dioxide by
8injecting it into a saline aquifer, a depleted gas reservoir,
9or an oil reservoir, directly or through an enhanced oil
10recovery process that may involve intermediate storage,
11regardless of whether these activities are conducted by a clean
12coal facility, a clean coal SNG facility, a clean coal SNG
13brownfield facility, or a party with which a clean coal
14facility, clean coal SNG facility, or clean coal SNG brownfield
15facility has contracted for such purposes.
16    "Sourcing agreement" means (i) in the case of an electric
17utility, an agreement between the owner of a clean coal
18facility and such electric utility, which agreement shall have
19terms and conditions meeting the requirements of paragraph (3)
20of subsection (d) of Section 1-75, (ii) in the case of an
21alternative retail electric supplier, an agreement between the
22owner of a clean coal facility and such alternative retail
23electric supplier, which agreement shall have terms and
24conditions meeting the requirements of Section 16-115(d)(5) of
25the Public Utilities Act, and (iii) in case of a gas utility,
26an agreement between the owner of a clean coal SNG brownfield

 

 

09800SB2365sam002- 15 -LRB098 06614 CEL 44664 a

1facility and the gas utility, which agreement shall have the
2terms and conditions meeting the requirements of subsection
3(h-1) of Section 9-220 of the Public Utilities Act.
4    "Substitute natural gas" or "SNG" means a gas manufactured
5by gasification of hydrocarbon feedstock, which is
6substantially interchangeable in use and distribution with
7conventional natural gas.
8    "Total resource cost test" or "TRC test" means a standard
9that is met if, for an investment in energy efficiency or
10demand-response measures, the benefit-cost ratio is greater
11than one. The benefit-cost ratio is the ratio of the net
12present value of the total benefits of the program to the net
13present value of the total costs as calculated over the
14lifetime of the measures. A total resource cost test compares
15the sum of avoided electric utility costs, representing the
16benefits that accrue to the system and the participant in the
17delivery of those efficiency measures, as well as other
18quantifiable societal benefits, including avoided natural gas
19utility costs, to the sum of all incremental costs of end-use
20measures that are implemented due to the program (including
21both utility and participant contributions), plus costs to
22administer, deliver, and evaluate each demand-side program, to
23quantify the net savings obtained by substituting the
24demand-side program for supply resources. In calculating
25avoided costs of power and energy that an electric utility
26would otherwise have had to acquire, reasonable estimates shall

 

 

09800SB2365sam002- 16 -LRB098 06614 CEL 44664 a

1be included of financial costs likely to be imposed by future
2regulations and legislation on emissions of greenhouse gases.
3(Source: P.A. 96-33, eff. 7-10-09; 96-159, eff. 8-10-09;
496-784, eff. 8-28-09; 96-1000, eff. 7-2-10; 97-96, eff.
57-13-11; 97-239, eff. 8-2-11; 97-491, eff. 8-22-11; 97-616,
6eff. 10-26-11; 97-813, eff. 7-13-12.)
 
7    Section 15. The Public Utilities Act is amended by changing
8Sections 8-103 and 8-104 as follows:
 
9    (220 ILCS 5/8-103)
10    Sec. 8-103. Energy efficiency and demand-response
11measures.
12    (a) It is the policy of the State that electric utilities
13are required to use cost-effective energy efficiency and
14demand-response measures to reduce delivery load. Requiring
15investment in cost-effective energy efficiency and
16demand-response measures will reduce direct and indirect costs
17to consumers by decreasing environmental impacts and by
18avoiding or delaying the need for new generation, transmission,
19and distribution infrastructure. It serves the public interest
20to allow electric utilities to recover costs for reasonably and
21prudently incurred expenses for energy efficiency and
22demand-response measures. As used in this Section,
23"cost-effective" means that the measures satisfy the total
24resource cost test. The low-income measures described in

 

 

09800SB2365sam002- 17 -LRB098 06614 CEL 44664 a

1subsection (f)(4) of this Section shall not be required to meet
2the total resource cost test. For purposes of this Section, the
3terms "energy-efficiency", "demand-response", "electric
4utility", and "total resource cost test" shall have the
5meanings set forth in the Illinois Power Agency Act. For
6purposes of this Section, the amount per kilowatthour means the
7total amount paid for electric service expressed on a per
8kilowatthour basis. For purposes of this Section, the total
9amount paid for electric service includes without limitation
10estimated amounts paid for supply, transmission, distribution,
11surcharges, and add-on-taxes.
12    (b) Electric utilities shall implement cost-effective
13energy efficiency measures to meet the following incremental
14annual energy savings goals:
15        (1) 0.2% of energy delivered in the year commencing
16    June 1, 2008;
17        (2) 0.4% of energy delivered in the year commencing
18    June 1, 2009;
19        (3) 0.6% of energy delivered in the year commencing
20    June 1, 2010;
21        (4) 0.8% of energy delivered in the year commencing
22    June 1, 2011;
23        (5) 1% of energy delivered in the year commencing June
24    1, 2012;
25        (6) 1.4% of energy delivered in the year commencing
26    June 1, 2013;

 

 

09800SB2365sam002- 18 -LRB098 06614 CEL 44664 a

1        (7) 1.8% of energy delivered in the year commencing
2    June 1, 2014; and
3        (8) 2% of energy delivered in the year commencing June
4    1, 2015 and each year thereafter.
5    Electric utilities may comply with this subsection (b) by
6meeting the annual incremental savings goal in the applicable
7year or by showing that total savings associated with measures
8implemented on or after May 31, 2014 were equal to the sum of
9each annual incremental savings requirement on or after June 1,
102014 through the end of the applicable year.
11    (c) Electric utilities shall implement cost-effective
12demand-response measures to reduce peak demand by 0.1% over the
13prior year for eligible retail customers, as defined in Section
1416-111.5 of this Act, and for customers that elect hourly
15service from the utility pursuant to Section 16-107 of this
16Act, provided those customers have not been declared
17competitive. This requirement commences June 1, 2008 and
18continues for 10 years.
19    (d) Notwithstanding the requirements of subsections (b)
20and (c) of this Section, an electric utility shall reduce the
21amount of energy efficiency and demand-response measures
22implemented over in any 3-year period single year by an amount
23necessary to limit the estimated average annual increase in the
24amounts paid by retail customers in connection with electric
25service due to the cost of those measures to:
26        (1) in 2008, no more than 0.5% of the amount paid per

 

 

09800SB2365sam002- 19 -LRB098 06614 CEL 44664 a

1    kilowatthour by those customers during the year ending May
2    31, 2007;
3        (2) in 2009, the greater of an additional 0.5% of the
4    amount paid per kilowatthour by those customers during the
5    year ending May 31, 2008 or 1% of the amount paid per
6    kilowatthour by those customers during the year ending May
7    31, 2007;
8        (3) in 2010, the greater of an additional 0.5% of the
9    amount paid per kilowatthour by those customers during the
10    year ending May 31, 2009 or 1.5% of the amount paid per
11    kilowatthour by those customers during the year ending May
12    31, 2007;
13        (4) in 2011, the greater of an additional 0.5% of the
14    amount paid per kilowatthour by those customers during the
15    year ending May 31, 2010 or 2% of the amount paid per
16    kilowatthour by those customers during the year ending May
17    31, 2007; and
18        (5) thereafter, the amount of energy efficiency and
19    demand-response measures implemented for any single year
20    shall be reduced by an amount necessary to limit the
21    estimated average net increase due to the cost of these
22    measures included in the amounts paid by eligible retail
23    customers in connection with electric service to no more
24    than the greater of 2.015% of the amount paid per
25    kilowatthour by those customers during the year ending May
26    31, 2007 or the incremental amount per kilowatthour paid

 

 

09800SB2365sam002- 20 -LRB098 06614 CEL 44664 a

1    for these measures in 2011.
2    No later than June 30, 2011, the Commission shall review
3the limitation on the amount of energy efficiency and
4demand-response measures implemented pursuant to this Section
5and report to the General Assembly its findings as to whether
6that limitation unduly constrains the procurement of energy
7efficiency and demand-response measures.
8    (e) Electric utilities shall be responsible for overseeing
9the design, development, and filing of energy efficiency and
10demand-response plans with the Commission. Electric utilities
11shall implement 100% of the demand-response measures in the
12plans. Electric utilities shall implement 75% of the energy
13efficiency measures approved by the Commission, and may, as
14part of that implementation, outsource various aspects of
15program development and implementation. The remaining 25% of
16those energy efficiency measures approved by the Commission
17shall be implemented by the Department of Commerce and Economic
18Opportunity, and must be designed in conjunction with the
19utility and the filing process. The Department may outsource
20development and implementation of energy efficiency measures.
21A minimum of 10% of the entire portfolio of cost-effective
22energy efficiency measures shall be procured from units of
23local government, municipal corporations, school districts,
24and community college districts. The Department shall
25coordinate the implementation of these measures.
26    The apportionment of the dollars to cover the costs to

 

 

09800SB2365sam002- 21 -LRB098 06614 CEL 44664 a

1implement the Department's share of the portfolio of energy
2efficiency measures shall be made to the Department once the
3Department has executed rebate agreements, grants, or
4contracts for energy efficiency measures and provided
5supporting documentation for those rebate agreements, grants,
6and contracts to the utility. The Department is authorized to
7adopt any rules necessary and prescribe procedures in order to
8ensure compliance by applicants in carrying out the purposes of
9rebate agreements for energy efficiency measures implemented
10by the Department made under this Section.
11    The details of the measures implemented by the Department
12shall be submitted by the Department to the Commission in
13connection with the utility's filing regarding the energy
14efficiency and demand-response measures that the utility
15implements.
16    A utility providing approved energy efficiency and
17demand-response measures in the State shall be permitted to
18recover costs of those measures through an automatic adjustment
19clause tariff filed with and approved by the Commission. The
20tariff shall be established outside the context of a general
21rate case. Each year the Commission shall initiate a review to
22reconcile any amounts collected with the actual costs and to
23determine the required adjustment to the annual tariff factor
24to match annual expenditures.
25    Each utility shall include, in its recovery of costs, the
26costs estimated for both the utility's and the Department's

 

 

09800SB2365sam002- 22 -LRB098 06614 CEL 44664 a

1implementation of energy efficiency and demand-response
2measures. Costs collected by the utility for measures
3implemented by the Department shall be submitted to the
4Department pursuant to Section 605-323 of the Civil
5Administrative Code of Illinois, shall be deposited into the
6Energy Efficiency Portfolio Standards Fund, and shall be used
7by the Department solely for the purpose of implementing these
8measures. A utility shall not be required to advance any moneys
9to the Department but only to forward such funds as it has
10collected. The Department shall report to the Commission on an
11annual basis regarding the costs actually incurred by the
12Department in the implementation of the measures. Any changes
13to the costs of energy efficiency measures as a result of plan
14modifications shall be appropriately reflected in amounts
15recovered by the utility and turned over to the Department.
16    The portfolio of measures, administered by both the
17utilities and the Department, shall, in combination, be
18designed to achieve the annual savings targets described in
19subsections (b) and (c) of this Section, as modified by
20subsection (d) of this Section.
21    The utility and the Department shall agree upon a
22reasonable portfolio of measures and determine the measurable
23corresponding percentage of the savings goals associated with
24measures implemented by the utility or Department.
25    No utility shall be assessed a penalty under subsection (f)
26of this Section for failure to make a timely filing if that

 

 

09800SB2365sam002- 23 -LRB098 06614 CEL 44664 a

1failure is the result of a lack of agreement with the
2Department with respect to the allocation of responsibilities
3or related costs or target assignments. In that case, the
4Department and the utility shall file their respective plans
5with the Commission and the Commission shall determine an
6appropriate division of measures and programs that meets the
7requirements of this Section.
8    If the Department is unable to meet incremental annual
9performance goals for the portion of the portfolio implemented
10by the Department, then the utility and the Department shall
11jointly submit a modified filing to the Commission explaining
12the performance shortfall and recommending an appropriate
13course going forward, including any program modifications that
14may be appropriate in light of the evaluations conducted under
15item (7) of subsection (f) of this Section. In this case, the
16utility obligation to collect the Department's costs and turn
17over those funds to the Department under this subsection (e)
18shall continue only if the Commission approves the
19modifications to the plan proposed by the Department.
20    (f) No later than November 15, 2007, each electric utility
21shall file an energy efficiency and demand-response plan with
22the Commission to meet the energy efficiency and
23demand-response standards for 2008 through 2010. No later than
24October 1, 2010, each electric utility shall file an energy
25efficiency and demand-response plan with the Commission to meet
26the energy efficiency and demand-response standards for 2011

 

 

09800SB2365sam002- 24 -LRB098 06614 CEL 44664 a

1through 2013. Every 3 years thereafter, each electric utility
2shall file, no later than September 1, an energy efficiency and
3demand-response plan with the Commission. If a utility does not
4file such a plan by September 1 of an applicable year, it shall
5face a penalty of $100,000 per day until the plan is filed.
6Each utility's plan shall set forth the utility's proposals to
7meet the utility's portion of the energy efficiency standards
8identified in subsection (b) and the demand-response standards
9identified in subsection (c) of this Section as modified by
10subsections (d) and (e), taking into account the unique
11circumstances of the utility's service territory. The
12Commission shall seek public comment on the utility's plan and
13shall issue an order approving or disapproving each plan within
145 months after its submission. If the Commission disapproves a
15plan, the Commission shall, within 30 days, describe in detail
16the reasons for the disapproval and describe a path by which
17the utility may file a revised draft of the plan to address the
18Commission's concerns satisfactorily. If the utility does not
19refile with the Commission within 60 days, the utility shall be
20subject to penalties at a rate of $100,000 per day until the
21plan is filed. This process shall continue, and penalties shall
22accrue, until the utility has successfully filed a portfolio of
23energy efficiency and demand-response measures. Penalties
24shall be deposited into the Energy Efficiency Trust Fund. In
25submitting proposed energy efficiency and demand-response
26plans and funding levels to meet the savings goals adopted by

 

 

09800SB2365sam002- 25 -LRB098 06614 CEL 44664 a

1this Act the utility shall:
2        (1) Demonstrate that its proposed energy efficiency
3    and demand-response measures will achieve the requirements
4    that are identified in subsections (b) and (c) of this
5    Section, as modified by subsections (d) and (e).
6        (2) Present specific proposals to implement new
7    building and appliance standards that have been placed into
8    effect.
9        (3) Present estimates of the total amount paid for
10    electric service expressed on a per kilowatthour basis
11    associated with the proposed portfolio of measures
12    designed to meet the requirements that are identified in
13    subsections (b) and (c) of this Section, as modified by
14    subsections (d) and (e).
15        (4) Coordinate with the Department to present a
16    portfolio of energy efficiency measures proportionate to
17    the share of total annual utility revenues in Illinois from
18    households at or below 150% of the poverty level. The
19    energy efficiency programs shall be targeted to households
20    with incomes at or below 80% of area median income.
21        (5) Demonstrate that its overall portfolio of energy
22    efficiency and demand-response measures, not including
23    programs covered by item (4) of this subsection (f), are
24    cost-effective using the total resource cost test and
25    represent a diverse cross-section of opportunities for
26    customers of all rate classes to participate in the

 

 

09800SB2365sam002- 26 -LRB098 06614 CEL 44664 a

1    programs.
2        (6) Include a proposed cost-recovery tariff mechanism
3    to fund the proposed energy efficiency and demand-response
4    measures and to ensure the recovery of the prudently and
5    reasonably incurred costs of Commission-approved programs.
6        (7) Provide for an annual independent evaluation of the
7    performance of the cost-effectiveness of the utility's
8    portfolio of measures and the Department's portfolio of
9    measures, as well as a full review of the 3-year results of
10    the broader net program impacts and, to the extent
11    practical, for adjustment of the measures on a
12    going-forward basis as a result of the evaluations. The
13    resources dedicated to evaluation shall not exceed 3% of
14    portfolio resources in any given year.
15    (g) No more than 3% of energy efficiency and
16demand-response program revenue may be allocated for
17demonstration of breakthrough equipment and devices.
18    (h) This Section does not apply to an electric utility that
19on December 31, 2005 provided electric service to fewer than
20100,000 customers in Illinois.
21    (i) If, after 2 years, an electric utility fails to meet
22the efficiency standard specified in subsection (b) of this
23Section, as modified by subsections (d) and (e), it shall make
24a contribution to the Low-Income Home Energy Assistance
25Program. The combined total liability for failure to meet the
26goal shall be $1,000,000, which shall be assessed as follows: a

 

 

09800SB2365sam002- 27 -LRB098 06614 CEL 44664 a

1large electric utility shall pay $665,000, and a medium
2electric utility shall pay $335,000. If, after 3 years, an
3electric utility fails to meet the efficiency standard
4specified in subsection (b) of this Section, as modified by
5subsections (d) and (e), it shall make a contribution to the
6Low-Income Home Energy Assistance Program. The combined total
7liability for failure to meet the goal shall be $1,000,000,
8which shall be assessed as follows: a large electric utility
9shall pay $665,000, and a medium electric utility shall pay
10$335,000. In addition, the responsibility for implementing the
11energy efficiency measures of the utility making the payment
12shall be transferred to the Illinois Power Agency if, after 3
13years, or in any subsequent 3-year period, the utility fails to
14meet the efficiency standard specified in subsection (b) of
15this Section, as modified by subsections (d) and (e). The
16Agency shall implement a competitive procurement program to
17procure resources necessary to meet the standards specified in
18this Section as modified by subsections (d) and (e), with costs
19for those resources to be recovered in the same manner as
20products purchased through the procurement plan as provided in
21Section 16-111.5. The Director shall implement this
22requirement in connection with the procurement plan as provided
23in Section 16-111.5.
24    For purposes of this Section, (i) a "large electric
25utility" is an electric utility that, on December 31, 2005,
26served more than 2,000,000 electric customers in Illinois; (ii)

 

 

09800SB2365sam002- 28 -LRB098 06614 CEL 44664 a

1a "medium electric utility" is an electric utility that, on
2December 31, 2005, served 2,000,000 or fewer but more than
3100,000 electric customers in Illinois; and (iii) Illinois
4electric utilities that are affiliated by virtue of a common
5parent company are considered a single electric utility.
6    (j) If, after 3 years, or any subsequent 3-year period, the
7Department fails to implement the Department's share of energy
8efficiency measures required by the standards in subsection
9(b), then the Illinois Power Agency may assume responsibility
10for and control of the Department's share of the required
11energy efficiency measures. The Agency shall implement a
12competitive procurement program to procure resources necessary
13to meet the standards specified in this Section, with the costs
14of these resources to be recovered in the same manner as
15provided for the Department in this Section.
16    (k) No electric utility shall be deemed to have failed to
17meet the energy efficiency standards to the extent any such
18failure is due to a failure of the Department or the Agency.
19(Source: P.A. 96-33, eff. 7-10-09; 96-159, eff. 8-10-09;
2096-1000, eff. 7-2-10; 97-616, eff. 10-26-11; 97-841, eff.
217-20-12.)
 
22    (220 ILCS 5/8-104)
23    Sec. 8-104. Natural gas energy efficiency programs.
24    (a) It is the policy of the State that natural gas
25utilities and the Department of Commerce and Economic

 

 

09800SB2365sam002- 29 -LRB098 06614 CEL 44664 a

1Opportunity are required to use cost-effective energy
2efficiency to reduce direct and indirect costs to consumers. It
3serves the public interest to allow natural gas utilities to
4recover costs for reasonably and prudently incurred expenses
5for cost-effective energy efficiency measures.
6    (b) For purposes of this Section, "energy efficiency" means
7measures that reduce the amount of energy required to achieve a
8given end use. "Energy efficiency" also includes measures that
9reduce the total Btus of electricity and natural gas needed to
10meet the end use or uses. "Cost-effective" and "cost-effective"
11means that the measures satisfy the total resource cost test
12which, for purposes of this Section, means a standard that is
13met if, for an investment in energy efficiency, the
14benefit-cost ratio is greater than one. The benefit-cost ratio
15is the ratio of the net present value of the total benefits of
16the measures to the net present value of the total costs as
17calculated over the lifetime of the measures. The total
18resource cost test compares the sum of avoided natural gas
19utility costs, representing the benefits that accrue to the
20system and the participant in the delivery of those efficiency
21measures, as well as other quantifiable societal benefits,
22including avoided electric utility costs, to the sum of all
23incremental costs of end use measures (including both utility
24and participant contributions), plus costs to administer,
25deliver, and evaluate each demand-side measure, to quantify the
26net savings obtained by substituting demand-side measures for

 

 

09800SB2365sam002- 30 -LRB098 06614 CEL 44664 a

1supply resources. In calculating avoided costs, reasonable
2estimates shall be included for financial costs likely to be
3imposed by future regulation of emissions of greenhouse gases.
4The low-income programs described in item (4) of subsection (f)
5of this Section shall not be required to meet the total
6resource cost test.
7    (c) Natural gas utilities shall implement cost-effective
8energy efficiency measures to meet at least the following
9natural gas savings requirements, which shall be based upon the
10total amount of gas delivered to retail customers, other than
11the customers described in subsection (m) of this Section,
12during calendar year 2009 multiplied by the applicable
13percentage. Natural gas utilities may comply with this Section
14by meeting the annual incremental savings goal in the
15applicable year or by showing that total savings associated
16with measures implemented after May 31, 2011 were equal to the
17sum of each annual incremental savings requirement from May 31,
182011 through the end of the applicable year:
19        (1) 0.2% by May 31, 2012;
20        (2) an additional 0.4% by May 31, 2013, increasing
21    total savings to .6%;
22        (3) an additional 0.6% by May 31, 2014, increasing
23    total savings to 1.2%;
24        (4) an additional 0.8% by May 31, 2015, increasing
25    total savings to 2.0%;
26        (5) an additional 1% by May 31, 2016, increasing total

 

 

09800SB2365sam002- 31 -LRB098 06614 CEL 44664 a

1    savings to 3.0%;
2        (6) an additional 1.2% by May 31, 2017, increasing
3    total savings to 4.2%;
4        (7) an additional 1.4% by May 31, 2018, increasing
5    total savings to 5.6%;
6        (8) an additional 1.5% by May 31, 2019, increasing
7    total savings to 7.1%; and
8        (9) an additional 1.5% in each 12-month period
9    thereafter.
10    (d) Notwithstanding the requirements of subsection (c) of
11this Section, a natural gas utility shall limit the amount of
12energy efficiency implemented in any 3-year reporting period
13established by subsection (f) of Section 8-104 of this Act, by
14an amount necessary to limit the estimated average increase in
15the amounts paid by retail customers in connection with natural
16gas service to no more than 2% in the applicable 3-year
17reporting period. The energy savings requirements in
18subsection (c) of this Section may be reduced by the Commission
19for the subject plan, if the utility demonstrates by
20substantial evidence that it is highly unlikely that the
21requirements could be achieved without exceeding the
22applicable spending limits in any 3-year reporting period. No
23later than September 1, 2013, the Commission shall review the
24limitation on the amount of energy efficiency measures
25implemented pursuant to this Section and report to the General
26Assembly, in the report required by subsection (k) of this

 

 

09800SB2365sam002- 32 -LRB098 06614 CEL 44664 a

1Section, its findings as to whether that limitation unduly
2constrains the procurement of energy efficiency measures.
3    (e) Natural gas utilities shall be responsible for
4overseeing the design, development, and filing of their
5efficiency plans with the Commission. The utility shall utilize
675% of the available funding associated with energy efficiency
7programs approved by the Commission, and may outsource various
8aspects of program development and implementation. The
9remaining 25% of available funding shall be used by the
10Department of Commerce and Economic Opportunity to implement
11energy efficiency measures that achieve no less than 20% of the
12requirements of subsection (c) of this Section. Such measures
13shall be designed in conjunction with the utility and approved
14by the Commission. The Department may outsource development and
15implementation of energy efficiency measures. A minimum of 10%
16of the entire portfolio of cost-effective energy efficiency
17measures shall be procured from local government, municipal
18corporations, school districts, and community college
19districts. Five percent of the entire portfolio of
20cost-effective energy efficiency measures may be granted to
21local government and municipal corporations for market
22transformation initiatives. The Department shall coordinate
23the implementation of these measures and shall integrate
24delivery of natural gas efficiency programs with electric
25efficiency programs delivered pursuant to Section 8-103 of this
26Act, unless the Department can show that integration is not

 

 

09800SB2365sam002- 33 -LRB098 06614 CEL 44664 a

1feasible.
2    The apportionment of the dollars to cover the costs to
3implement the Department's share of the portfolio of energy
4efficiency measures shall be made to the Department once the
5Department has executed rebate agreements, grants, or
6contracts for energy efficiency measures and provided
7supporting documentation for those rebate agreements, grants,
8and contracts to the utility. The Department is authorized to
9adopt any rules necessary and prescribe procedures in order to
10ensure compliance by applicants in carrying out the purposes of
11rebate agreements for energy efficiency measures implemented
12by the Department made under this Section.
13    The details of the measures implemented by the Department
14shall be submitted by the Department to the Commission in
15connection with the utility's filing regarding the energy
16efficiency measures that the utility implements.
17    A utility providing approved energy efficiency measures in
18this State shall be permitted to recover costs of those
19measures through an automatic adjustment clause tariff filed
20with and approved by the Commission. The tariff shall be
21established outside the context of a general rate case and
22shall be applicable to the utility's customers other than the
23customers described in subsection (m) of this Section. Each
24year the Commission shall initiate a review to reconcile any
25amounts collected with the actual costs and to determine the
26required adjustment to the annual tariff factor to match annual

 

 

09800SB2365sam002- 34 -LRB098 06614 CEL 44664 a

1expenditures.
2    Each utility shall include, in its recovery of costs, the
3costs estimated for both the utility's and the Department's
4implementation of energy efficiency measures. Costs collected
5by the utility for measures implemented by the Department shall
6be submitted to the Department pursuant to Section 605-323 of
7the Civil Administrative Code of Illinois, shall be deposited
8into the Energy Efficiency Portfolio Standards Fund, and shall
9be used by the Department solely for the purpose of
10implementing these measures. A utility shall not be required to
11advance any moneys to the Department but only to forward such
12funds as it has collected. The Department shall report to the
13Commission on an annual basis regarding the costs actually
14incurred by the Department in the implementation of the
15measures. Any changes to the costs of energy efficiency
16measures as a result of plan modifications shall be
17appropriately reflected in amounts recovered by the utility and
18turned over to the Department.
19    The portfolio of measures, administered by both the
20utilities and the Department, shall, in combination, be
21designed to achieve the annual energy savings requirements set
22forth in subsection (c) of this Section, as modified by
23subsection (d) of this Section.
24    The utility and the Department shall agree upon a
25reasonable portfolio of measures and determine the measurable
26corresponding percentage of the savings goals associated with

 

 

09800SB2365sam002- 35 -LRB098 06614 CEL 44664 a

1measures implemented by the Department.
2    No utility shall be assessed a penalty under subsection (f)
3of this Section for failure to make a timely filing if that
4failure is the result of a lack of agreement with the
5Department with respect to the allocation of responsibilities
6or related costs or target assignments. In that case, the
7Department and the utility shall file their respective plans
8with the Commission and the Commission shall determine an
9appropriate division of measures and programs that meets the
10requirements of this Section.
11    If the Department is unable to meet performance
12requirements for the portion of the portfolio implemented by
13the Department, then the utility and the Department shall
14jointly submit a modified filing to the Commission explaining
15the performance shortfall and recommending an appropriate
16course going forward, including any program modifications that
17may be appropriate in light of the evaluations conducted under
18item (8) of subsection (f) of this Section. In this case, the
19utility obligation to collect the Department's costs and turn
20over those funds to the Department under this subsection (e)
21shall continue only if the Commission approves the
22modifications to the plan proposed by the Department.
23    (f) No later than October 1, 2010, each gas utility shall
24file an energy efficiency plan with the Commission to meet the
25energy efficiency standards through May 31, 2014. Every 3 years
26thereafter, each utility shall file, no later than October 1,

 

 

09800SB2365sam002- 36 -LRB098 06614 CEL 44664 a

1an energy efficiency plan with the Commission. If a utility
2does not file such a plan by October 1 of the applicable year,
3then it shall face a penalty of $100,000 per day until the plan
4is filed. Each utility's plan shall set forth the utility's
5proposals to meet the utility's portion of the energy
6efficiency standards identified in subsection (c) of this
7Section, as modified by subsection (d) of this Section, taking
8into account the unique circumstances of the utility's service
9territory. The Commission shall seek public comment on the
10utility's plan and shall issue an order approving or
11disapproving each plan. If the Commission disapproves a plan,
12the Commission shall, within 30 days, describe in detail the
13reasons for the disapproval and describe a path by which the
14utility may file a revised draft of the plan to address the
15Commission's concerns satisfactorily. If the utility does not
16refile with the Commission within 60 days after the
17disapproval, the utility shall be subject to penalties at a
18rate of $100,000 per day until the plan is filed. This process
19shall continue, and penalties shall accrue, until the utility
20has successfully filed a portfolio of energy efficiency
21measures. Penalties shall be deposited into the Energy
22Efficiency Trust Fund and the cost of any such penalties may
23not be recovered from ratepayers. In submitting proposed energy
24efficiency plans and funding levels to meet the savings goals
25adopted by this Act the utility shall:
26        (1) Demonstrate that its proposed energy efficiency

 

 

09800SB2365sam002- 37 -LRB098 06614 CEL 44664 a

1    measures will achieve the requirements that are identified
2    in subsection (c) of this Section, as modified by
3    subsection (d) of this Section.
4        (2) Present specific proposals to implement new
5    building and appliance standards that have been placed into
6    effect.
7        (3) Present estimates of the total amount paid for gas
8    service expressed on a per therm basis associated with the
9    proposed portfolio of measures designed to meet the
10    requirements that are identified in subsection (c) of this
11    Section, as modified by subsection (d) of this Section.
12        (4) Coordinate with the Department to present a
13    portfolio of energy efficiency measures proportionate to
14    the share of total annual utility revenues in Illinois from
15    households at or below 150% of the poverty level. Such
16    programs shall be targeted to households with incomes at or
17    below 80% of area median income.
18        (5) Demonstrate that its overall portfolio of energy
19    efficiency measures, not including programs covered by
20    item (4) of this subsection (f), are cost-effective using
21    the total resource cost test and represent a diverse cross
22    section of opportunities for customers of all rate classes
23    to participate in the programs.
24        (6) Demonstrate that a gas utility affiliated with an
25    electric utility that is required to comply with Section
26    8-103 of this Act has integrated gas and electric

 

 

09800SB2365sam002- 38 -LRB098 06614 CEL 44664 a

1    efficiency measures into a single program that reduces
2    program or participant costs and appropriately allocates
3    costs to gas and electric ratepayers. The Department shall
4    integrate all gas and electric programs it delivers in any
5    such utilities' service territories, unless the Department
6    can show that integration is not feasible or appropriate.
7        (7) Include a proposed cost recovery tariff mechanism
8    to fund the proposed energy efficiency measures and to
9    ensure the recovery of the prudently and reasonably
10    incurred costs of Commission-approved programs.
11        (8) Provide for quarterly status reports tracking
12    implementation of and expenditures for the utility's
13    portfolio of measures and the Department's portfolio of
14    measures, an annual independent review, and a full
15    independent evaluation of the 3-year results of the
16    performance and the cost-effectiveness of the utility's
17    and Department's portfolios of measures and broader net
18    program impacts and, to the extent practical, for
19    adjustment of the measures on a going forward basis as a
20    result of the evaluations. The resources dedicated to
21    evaluation shall not exceed 3% of portfolio resources in
22    any given 3-year period.
23    (g) No more than 3% of expenditures on energy efficiency
24measures may be allocated for demonstration of breakthrough
25equipment and devices.
26    (h) Illinois natural gas utilities that are affiliated by

 

 

09800SB2365sam002- 39 -LRB098 06614 CEL 44664 a

1virtue of a common parent company may, at the utilities'
2request, be considered a single natural gas utility for
3purposes of complying with this Section.
4    (i) If, after 3 years, a gas utility fails to meet the
5efficiency standard specified in subsection (c) of this Section
6as modified by subsection (d), then it shall make a
7contribution to the Low-Income Home Energy Assistance Program.
8The total liability for failure to meet the goal shall be
9assessed as follows:
10        (1) a large gas utility shall pay $600,000;
11        (2) a medium gas utility shall pay $400,000; and
12        (3) a small gas utility shall pay $200,000.
13    For purposes of this Section, (i) a "large gas utility" is
14a gas utility that on December 31, 2008, served more than
151,500,000 gas customers in Illinois; (ii) a "medium gas
16utility" is a gas utility that on December 31, 2008, served
17fewer than 1,500,000, but more than 500,000 gas customers in
18Illinois; and (iii) a "small gas utility" is a gas utility that
19on December 31, 2008, served fewer than 500,000 and more than
20100,000 gas customers in Illinois. The costs of this
21contribution may not be recovered from ratepayers.
22    If a gas utility fails to meet the efficiency standard
23specified in subsection (c) of this Section, as modified by
24subsection (d) of this Section, in any 2 consecutive 3-year
25planning periods, then the responsibility for implementing the
26utility's energy efficiency measures shall be transferred to an

 

 

09800SB2365sam002- 40 -LRB098 06614 CEL 44664 a

1independent program administrator selected by the Commission.
2Reasonable and prudent costs incurred by the independent
3program administrator to meet the efficiency standard
4specified in subsection (c) of this Section, as modified by
5subsection (d) of this Section, may be recovered from the
6customers of the affected gas utilities, other than customers
7described in subsection (m) of this Section. The utility shall
8provide the independent program administrator with all
9information and assistance necessary to perform the program
10administrator's duties including but not limited to customer,
11account, and energy usage data, and shall allow the program
12administrator to include inserts in customer bills. The utility
13may recover reasonable costs associated with any such
14assistance.
15    (j) No utility shall be deemed to have failed to meet the
16energy efficiency standards to the extent any such failure is
17due to a failure of the Department.
18    (k) Not later than January 1, 2012, the Commission shall
19develop and solicit public comment on a plan to foster
20statewide coordination and consistency between statutorily
21mandated natural gas and electric energy efficiency programs to
22reduce program or participant costs or to improve program
23performance. Not later than September 1, 2013, the Commission
24shall issue a report to the General Assembly containing its
25findings and recommendations.
26    (l) This Section does not apply to a gas utility that on

 

 

09800SB2365sam002- 41 -LRB098 06614 CEL 44664 a

1January 1, 2009, provided gas service to fewer than 100,000
2customers in Illinois.
3    (m) Subsections (a) through (k) of this Section do not
4apply to customers of a natural gas utility that have a North
5American Industry Classification System code number that is
622111 or any such code number beginning with the digits 31, 32,
7or 33 and (i) annual usage in the aggregate of 4 million therms
8or more within the service territory of the affected gas
9utility or with aggregate usage of 8 million therms or more in
10this State and complying with the provisions of item (l) of
11this subsection (m); or (ii) using natural gas as feedstock and
12meeting the usage requirements described in item (i) of this
13subsection (m), to the extent such annual feedstock usage is
14greater than 60% of the customer's total annual usage of
15natural gas.
16        (1) Customers described in this subsection (m) of this
17    Section shall apply, on a form approved on or before
18    October 1, 2009 by the Department, to the Department to be
19    designated as a self-directing customer ("SDC") or as an
20    exempt customer using natural gas as a feedstock from which
21    other products are made, including, but not limited to,
22    feedstock for a hydrogen plant, on or before the 1st day of
23    February, 2010. Thereafter, application may be made not
24    less than 6 months before the filing date of the gas
25    utility energy efficiency plan described in subsection (f)
26    of this Section; however, a new customer that commences

 

 

09800SB2365sam002- 42 -LRB098 06614 CEL 44664 a

1    taking service from a natural gas utility after February 1,
2    2010 may apply to become a SDC or exempt customer up to 30
3    days after beginning service. Such application shall
4    contain the following:
5            (A) the customer's certification that, at the time
6        of its application, it qualifies to be a SDC or exempt
7        customer described in this subsection (m) of this
8        Section;
9            (B) in the case of a SDC, the customer's
10        certification that it has established or will
11        establish by the beginning of the utility's 3-year
12        planning period commencing subsequent to the
13        application, and will maintain for accounting
14        purposes, an energy efficiency reserve account and
15        that the customer will accrue funds in said account to
16        be held for the purpose of funding, in whole or in
17        part, energy efficiency measures of the customer's
18        choosing, which may include, but are not limited to,
19        projects involving combined heat and power systems
20        that use the same energy source both for the generation
21        of electrical or mechanical power and the production of
22        steam or another form of useful thermal energy or the
23        use of combustible gas produced from biomass, or both;
24            (C) in the case of a SDC, the customer's
25        certification that annual funding levels for the
26        energy efficiency reserve account will be equal to 2%

 

 

09800SB2365sam002- 43 -LRB098 06614 CEL 44664 a

1        of the customer's cost of natural gas, composed of the
2        customer's commodity cost and the delivery service
3        charges paid to the gas utility, or $150,000, whichever
4        is less;
5            (D) in the case of a SDC, the customer's
6        certification that the required reserve account
7        balance will be capped at 3 years' worth of accruals
8        and that the customer may, at its option, make further
9        deposits to the account to the extent such deposit
10        would increase the reserve account balance above the
11        designated cap level;
12            (E) in the case of a SDC, the customer's
13        certification that by October 1 of each year, beginning
14        no sooner than October 1, 2012, the customer will
15        report to the Department information, for the 12-month
16        period ending May 31 of the same year, on all deposits
17        and reductions, if any, to the reserve account during
18        the reporting year, and to the extent deposits to the
19        reserve account in any year are in an amount less than
20        $150,000, the basis for such reduced deposits; reserve
21        account balances by month; a description of energy
22        efficiency measures undertaken by the customer and
23        paid for in whole or in part with funds from the
24        reserve account; an estimate of the energy saved, or to
25        be saved, by the measure; and that the report shall
26        include a verification by an officer or plant manager

 

 

09800SB2365sam002- 44 -LRB098 06614 CEL 44664 a

1        of the customer or by a registered professional
2        engineer or certified energy efficiency trade
3        professional that the funds withdrawn from the reserve
4        account were used for the energy efficiency measures;
5            (F) in the case of an exempt customer, the
6        customer's certification of the level of gas usage as
7        feedstock in the customer's operation in a typical year
8        and that it will provide information establishing this
9        level, upon request of the Department;
10            (G) in the case of either an exempt customer or a
11        SDC, the customer's certification that it has provided
12        the gas utility or utilities serving the customer with
13        a copy of the application as filed with the Department;
14            (H) in the case of either an exempt customer or a
15        SDC, certification of the natural gas utility or
16        utilities serving the customer in Illinois including
17        the natural gas utility accounts that are the subject
18        of the application; and
19            (I) in the case of either an exempt customer or a
20        SDC, a verification signed by a plant manager or an
21        authorized corporate officer attesting to the
22        truthfulness and accuracy of the information contained
23        in the application.
24        (2) The Department shall review the application to
25    determine that it contains the information described in
26    provisions (A) through (I) of item (1) of this subsection

 

 

09800SB2365sam002- 45 -LRB098 06614 CEL 44664 a

1    (m), as applicable. The review shall be completed within 30
2    days after the date the application is filed with the
3    Department. Absent a determination by the Department
4    within the 30-day period, the applicant shall be considered
5    to be a SDC or exempt customer, as applicable, for all
6    subsequent 3-year planning periods, as of the date of
7    filing the application described in this subsection (m). If
8    the Department determines that the application does not
9    contain the applicable information described in provisions
10    (A) through (I) of item (1) of this subsection (m), it
11    shall notify the customer, in writing, of its determination
12    that the application does not contain the required
13    information and identify the information that is missing,
14    and the customer shall provide the missing information
15    within 15 working days after the date of receipt of the
16    Department's notification.
17        (3) The Department shall have the right to audit the
18    information provided in the customer's application and
19    annual reports to ensure continued compliance with the
20    requirements of this subsection. Based on the audit, if the
21    Department determines the customer is no longer in
22    compliance with the requirements of items (A) through (I)
23    of item (1) of this subsection (m), as applicable, the
24    Department shall notify the customer in writing of the
25    noncompliance. The customer shall have 30 days to establish
26    its compliance, and failing to do so, may have its status

 

 

09800SB2365sam002- 46 -LRB098 06614 CEL 44664 a

1    as a SDC or exempt customer revoked by the Department. The
2    Department shall treat all information provided by any
3    customer seeking SDC status or exemption from the
4    provisions of this Section as strictly confidential.
5        (4) Upon request, or on its own motion, the Commission
6    may open an investigation, no more than once every 3 years
7    and not before October 1, 2014, to evaluate the
8    effectiveness of the self-directing program described in
9    this subsection (m).
10    (n) The applicability of this Section to customers
11described in subsection (m) of this Section is conditioned on
12the existence of the SDC program. In no event will any
13provision of this Section apply to such customers after January
141, 2020.
15(Source: P.A. 96-33, eff. 7-10-09; 97-813, eff. 7-13-12;
1697-841, eff. 7-20-12.)
 
17    Section 99. Effective date. This Act takes effect upon
18becoming law.".