ENGROSSED
H. B. 408
(By Mr. Speaker, Mr. Thompson, and Delegate Armstead)
[By Request of the Executive]
[Introduced November 17, 2009; referred to the
Committee on Government Organization.]
A BILL to
amend and reenact §24-2F-3, §24-2F-4, §24-2F-5 and §24-
2F-9 of the Code of West Virginia, 1931, as amended, all
relating to the Alternative and Renewable Energy Portfolio
Act; limiting the use of supercritical technology to qualify
as advanced coal technology for the purpose of determining
credits; allowing the use of advanced supercritical technology
to qualify as advanced coal technology for the purpose of
determining credits; allowing the Public Service Commission to
certify additional advanced coal technologies; allowing for
the utilization of an independent and industry-recognized
alternative and renewable energy resource credit tracking
system; exempting certain credit pricing data from disclosure
under the freedom of information act; allowing for the
utilization of an independent and industry-recognized entity to verify and certify greenhouse gas emission reduction or
offset projects; allowing credits for certain energy
efficiency and demand-side projects undertaken pursuant to
federal requirements; and requiring a study of the economic
impacts of the Alternative and Renewable Energy Portfolio Act
on coal and coal mining.
Be it enacted by the Legislature of West Virginia:
That §24-2F-3, §24-2F-4, §24-2F-5 and §24-2F-9 of the Code of
West Virginia, 1931, as amended, be amended and reenacted, all to
read as follows:
ARTICLE 2F. ALTERNATIVE AND RENEWABLE ENERGY PORTFOLIO STANDARD.
§24-2F-3. Definitions.
Unless the context clearly requires a different meaning, as
used in this article:
(1) "Advanced coal technology" means a technology that is used
in a new or existing energy generating facility to reduce airborne
carbon emissions associated with the combustion or use of coal and
includes, but is not limited to, carbon dioxide capture and
sequestration technology, supercritical technology,
advanced
supercritical technology as that technology is determined by the
Public Service Commission, ultrasupercritical technology and
pressurized fluidized bed technology
and any other resource,
method, project or technology certified by the commission as
advanced coal technology.
(2) "Alternative and renewable energy portfolio standard" or
"portfolio standard" means a requirement in any given year that
requires an electric utility to own credits in an amount equal to
a certain percentage of electric energy sold in the preceding
calendar year by the electric utility to retail customers in this
state.
(3) "Alternative energy resources" means any of the following
resources, methods or technologies for the production or generation
of electricity:
(A) Advanced coal technology;
(B) Coal bed methane;
(C) Natural gas;
(D) Fuel produced by a coal gasification or liquefaction
facility;
(E) Synthetic gas;
(F) Integrated gasification combined cycle technologies;
(G) Waste coal;
(H) Tirederived fuel;
(I) Pumped storage hydroelectric projects;
(J) Recycled energy, which means useful thermal, mechanical or
electrical energy produced from: (i) Exhaust heat from any
commercial or industrial process; (ii) waste gas, waste fuel or
other forms of energy that would otherwise be flared, incinerated,
disposed of or vented; and (iii) electricity or equivalent mechanical energy extracted from a pressure drop in any gas,
excluding any pressure drop to a condenser that subsequently vents
the resulting heat; and
(K) Any other resource, method, project or technology
certified as an alternative energy resource by the Public Service
Commission.
(4) "Alternative and renewable energy resource credit" or
"credit" means a tradable instrument that is used to establish,
verify and monitor the generation of electricity from alternative
and renewable energy resource facilities, energy efficiency or
demand-side energy initiative projects or greenhouse gas emission
reduction or offset projects.
(5) "Alternative energy resource facility" means a facility or
equipment that generates electricity from alternative energy
resources.
(6) "Commission" or "Public Service Commission" means the
Public Service Commission of West Virginia as continued pursuant to
section three, article one of this chapter.
(7) "Customer-generator" means an electric retail customer who
owns and operates a customer-sited generation project utilizing an
alternative or renewable energy resource or a net metering system
in this state.
(8) "Electric utility" means any electric distribution company
or electric generation supplier that sells electricity to retail customers in this state. Unless specifically provided for
otherwise, for the purposes of this article, the term "electric
utility" may not include rural electric cooperatives, municipally-
owned electric facilities or utilities serving less than thirty
thousand residential electric customers in West Virginia.
(9) "Energy efficiency or demand-side energy initiative
project" means a project in this state that promotes customer
energy efficiency or the management of customer consumption of
electricity through the implementation of:
(A) Energy efficiency technologies, equipment, management
practices or other strategies utilized by residential, commercial,
industrial, institutional or government customers that reduce
electricity consumption by those customers;
(B) Load management or demand response technologies,
equipment, management practices, interruptible or curtailable
tariffs, energy storage devices or other strategies in residential,
commercial, industrial, institutional and government customers that
shift electric load from periods of higher demand to periods of
lower demand;
(C) Industrial by-product technologies consisting of the use
of a by-product from an industrial process, including, but not
limited to, the reuse of energy from exhaust gases or other
manufacturing by-products that can be used in the direct production
of electricity at the customer's facility;
(D) Customer-sited generation, demand-response, energy
efficiency or peak demand reduction capabilities, whether new or
existing, that the customer commits for integration into the
electric utility's demand-response, energy efficiency or peak
demand reduction programs; or
(E) Infrastructure and modernization projects that help
promote energy efficiency, reduce energy losses or shift load from
periods of higher demand to periods of lower demand, including the
modernization of metering and communications (also known as "smart
grid"), distribution automation, energy storage, distributed energy
resources and investments to promote the electrification of
transportation.
(10) "Greenhouse gas emission reduction or offset project"
means a project to reduce or offset greenhouse gas emissions from
sources in this state other than the electric utility's own
generating and energy delivery operations. Greenhouse gas emission
reduction or offset projects include, but are not limited to:
(A) Methane capture and destruction from landfills, coal mines
or farms;
(B) Forestation, afforestation or reforestation; and
(C) Nitrous oxide or carbon dioxide sequestration through
reduced fertilizer use or no-till farming.
(11) "Net metering" means measuring the difference between
electricity supplied by an electric utility and electricity generated from an alternative or renewable energy resource facility
owned or operated by an electric retail customer when any portion
of the electricity generated from the alternative or renewable
energy resource facility is used to offset part or all of the
electric retail customer's requirements for electricity.
(12) "Reclaimed surface mine" means a surface mine, as that
term is defined in section three, article three, chapter twenty-two
of this code, that is reclaimed or is being reclaimed in accordance
with state or federal law.
(13) "Renewable energy resource" means any of the following
resources, methods, projects or technologies for the production or
generation of electricity:
(A) Solar photovoltaic or other solar electric energy;
(B) Solar thermal energy;
(C) Wind power;
(D) Run of river hydropower;
(E) Geothermal energy, which means a technology by which
electricity is produced by extracting hot water or steam from
geothermal reserves in the earth's crust to power steam turbines
that drive generators to produce electricity;
(F) Biomass energy, which means a technology by which
electricity is produced from a nonhazardous organic material that
is available on a renewable or recurring basis, including pulp mill
sludge;
(G) Biologically derived fuel including methane gas, ethanol
not produced from corn, or biodiesel fuel;
(H) Fuel cell technology, which means any electrochemical
device that converts chemical energy in a hydrogen-rich fuel
directly into electricity, heat and water without combustion; and
(I) Any other resource, method, project or technology
certified by the commission as a renewable energy resource.
(14) "Renewable energy resource facility" means a facility or
equipment that generates electricity from renewable energy
resources.
(15) "Waste coal" means a technology by which electricity is
produced by the combustion of the by-product, waste or residue
created from processing coal (such as gob).
§24-2F-4. Awarding of alternative and renewable energy resource
credits.
(a)
Credits established. -- The Public Service Commission
shall establish a system of tradable credits to establish, verify
and monitor the generation and sale of electricity generated from
alternative and renewable energy resource facilities. The credits
may be traded, sold or used to meet the portfolio standards
established in section five of this article.
(b)
Awarding of credits. -- Credits shall be awarded as
follows:
(1) An electric utility shall be awarded one credit for each megawatt hour of electricity generated or purchased from an
alternative energy resource facility located within the
geographical boundaries of this state or located outside of the
geographical boundaries of this state but within the service
territory of a regional transmission organization, as that term is
defined in 18 C.F.R. §35.34, that manages the transmission system
in any part of this state;
(2) An electric utility shall be awarded two credits for each
megawatt hour of electricity generated or purchased from a
renewable energy resource facility located within the geographical
boundaries of this state or located outside of the geographical
boundaries of this state but within the service territory of a
regional transmission organization, as that term is defined in 18
C.F.R. §35.34, that manages the transmission system in any part of
this state;
(3) An electric utility shall be awarded three credits for
each megawatt hour of electricity generated or purchased from a
renewable energy resource facility located within the geographical
boundaries of this state if the renewable energy resource facility
is sited upon a reclaimed surface mine; and
(4) A customer-generator shall be awarded one credit for each
megawatt hour of electricity generated from an alternative energy
resource facility and shall be awarded two credits for each
megawatt hour of electricity generated from a renewable energy resource facility.
(c)
Acquiring of credits permitted. --
(1) An electric utility may meet the alternative and renewable
energy portfolio standards set forth in this article by purchasing
additional credits. Credits may be bought or sold by an electric
utility or customer-generator or banked and used to meet an
alternative and renewable energy portfolio standard requirement in
a subsequent year.
(2) Each credit transaction shall be reported by the selling
entity to the Public Service Commission on a form provided by the
commission.
(3) As soon as reasonably possible after the effective date of
this section, the commission shall establish a registry of data,
or
use an independent and industry-recognized system, that shall track
credit transactions and shall list the following information for
each transaction: (i) The parties to the transaction; (ii) the
number of credits sold or transferred; and (iii) the price paid.
Information contained in the registry shall be available to the
public,
except that pricing information concerning individual
transactions shall be confidential and exempt from disclosure under
subdivision (5), subsection (a), section four, article one, chapter
twenty-nine-b of this code.
(4) The commission may impose an administrative transaction
fee on a credit transaction in an amount not to exceed the actual direct cost of processing the transaction by the commission.
(d)
Credits for certain emission reduction or offset projects.
--
(1) The commission may award credits to an electric utility
for greenhouse gas emission reduction or offset projects. For each
ton of carbon dioxide equivalent reduced or offset as a result of
an approved greenhouse gas emission reduction project, the
commission shall award an electric utility one credit:
Provided,
That the emissions reductions and offsets are verifiable and
certified in accordance with rules promulgated by the commission:
Provided, however, That the commission has previously approved the
greenhouse gas emission reduction and offset project for credit in
accordance with section six of this article.
(2) The commission shall consult and coordinate with the
Secretary of the Department of Environmental Protection
or an
independent and industry-recognized entity to verify and certify
greenhouse gas emission reduction or offset projects. The
Secretary of the Department of Environmental Protection shall
provide assistance and information to the Public Service Commission
and may enter into interagency agreements with the commission to
effectuate the purposes of this subsection.
(3) Notwithstanding the provisions of this subsection, an
electric utility may not be awarded credits for a greenhouse gas
emission reduction or offset project undertaken pursuant to any obligation under any other state law, policy or regulation.
(e)
Credits for certain energy efficiency and demand-side
energy initiative projects. --
(1) The commission may award credits to an electric utility
for investments in energy efficiency and demand-side energy
initiative projects. For each megawatt hour of electricity
conserved as a result of an approved energy efficiency or demand-
side energy initiative project, the commission shall award one
credit:
Provided, That the amount of electricity claimed to be
conserved is verifiable and certified in accordance with rules
promulgated by the commission:
Provided, however, That the
commission has approved the energy efficiency or demand-side energy
initiative project for credit in accordance with section six of
this article.
(2) Notwithstanding the provisions of this subsection, an
electric utility may not be awarded credit for an energy efficiency
or demand-side energy initiative project undertaken pursuant to any
obligation under any other state
or federal law, policy or
regulation.
§24-2F-5. Alternative and renewable energy portfolio standard;
compliance assessments.
(a)
General rule. -- Each electric utility doing business in
this state shall be required to meet the alternative and renewable
energy portfolio standards set forth in this section. In order to meet these standards, an electric utility each year shall own an
amount of credits equal to a certain percentage of electricity, as
set forth in subsections (c) and (d) of this section, sold by the
electric utility in the preceding year to retail customers in West
Virginia.
(b)
Counting of credits towards compliance. -- For the purpose
of determining an electric utility's compliance with the
alternative and renewable energy portfolio standards set forth in
subsections (c) and (d) of this section, each credit shall equal
one megawatt hour of electricity sold by an electric utility in the
preceding year to retail customers in West Virginia. Furthermore,
a credit may not be used more than once to meet the requirements of
this section.
No more than ten percent of the credits used each
year to meet the compliance requirements of this section may be
credits acquired from the generation or purchase of electricity
generated from natural gas. No more than ten percent of the
credits used each year to meet the compliance requirements of this
section may be credits acquired from the generation or purchase of
electricity generated from supercritical technology.
(c) Twenty-five percent by 2025. -- On and after January 1,
2025, an electric utility shall each year own credits in an amount
equal to at least twenty-five percent of the electric energy sold
by the electric utility to retail customers in this state in the
preceding calendar year.
(d) Interim portfolio standards. --
(1) For the period beginning January 1, 2015, and ending
December 31, 2019, an electric utility shall each year own credits
in an amount equal to at least ten percent of the electric energy
sold by the electric utility to retail customers in this state in
the preceding calendar year; and
(2) For the period beginning January 1, 2020, and ending
December 31, 2024, an electric utility shall each year own credits
in an amount equal to at least fifteen percent of the electric
energy sold by the electric utility to retail customers in this
state in the preceding calendar year.
(e) Double-counting of credits prohibited. -- Any portion of
electricity generated from an alternative or renewable energy
resource facility that is used to meet another state's alternative
energy, advanced energy, renewable energy or similar energy
portfolio standard may not be used to meet the requirements of this
section. An electric utility that is subject to an alternative
energy, advanced energy, renewable energy or similar energy
portfolio standard in any other state shall list, in the
alternative and renewable energy portfolio standard compliance plan
required under section six of this article, any such requirements
and shall indicate how it satisfied those requirements. The
electric utility shall provide in the annual progress report
required under section six of this article any additional information required by the commission to prevent double-counting
of credits.
(f) Carryover. -- An electric utility may apply any credits
that are in excess of the alternative and renewable energy
portfolio standard in any given year to the requirements for any
future year portfolio standard: Provided, That the electric
utility determines to the satisfaction of the commission that such
credits were in excess of the portfolio standard in a given year
and that such credits have not previously been used for compliance
with a portfolio standard.
(g) Compliance assessments. --
(1) On or after January 1, 2015, and each year thereafter, the
commission shall determine whether each electric utility doing
business in this state is in compliance with this section. If,
after notice and a hearing, the commission determines that an
electric utility has failed to comply with an alternative and
renewable energy portfolio standard, the commission shall impose a
compliance assessment on the electric utility which shall equal at
least the lesser of the following:
(A) Fifty dollars multiplied by the number of additional
credits that would be needed to meet an alternative and renewable
energy portfolio standard in a given year; or
(B) Two hundred percent of the average market value of credits
sold in a given year multiplied by the number of additional credits needed to meet the alternative and renewable energy portfolio
standard for that year.
(2) Compliance assessments collected by the commission
pursuant to this subsection shall be deposited into the Alternative
and Renewable Energy Resources Research Fund established in section
eleven of this article.
(h) Force majeure. --
(1) Upon its own initiative or upon the request of an electric
utility, the commission may modify the portfolio standard
requirements of an electric utility in a given year or years or
recommend to the Legislature that the portfolio standard
requirements be eliminated if the commission determines that
alternative or renewable energy resources are not reasonably
available in the marketplace in sufficient quantities for the
electric utility to meet the requirements of this article.
(2) In making its determination, the commission shall consider
whether the electric utility made good faith efforts to acquire
sufficient credits to comply with the requirements of this article.
Such good faith efforts shall include, but are not limited to,
banking excess credits, seeking credits through competitive
solicitations and seeking to acquire credits through long-term
contracts. The commission shall assess the availability of credits
on the open market. The commission may also require that the
electric utility solicit credits before a request for modification may be granted.
(3) If an electric utility requests a modification of its
portfolio standard requirements, the commission shall make a
determination as to the request within sixty days.
(4) Commission modification of an electric utility's portfolio
standard requirements shall apply only to the portfolio standard in
the year or years modified by the commission. Commission
modification may not automatically reduce an electric utility's
alternative and renewable energy portfolio standard requirements in
future years.
(5) If the commission modifies an electric utility's portfolio
standard requirements, the commission may also require the electric
utility to acquire additional credits in subsequent years
equivalent to the requirements reduced by the commission in
accordance with this subsection.
(i) Termination -- The provisions of this section shall have
no force and effect after June 30, 2026.
§24-2F-9. Interagency agreements; alternative and renewable energy
resource planning assessment.
(a) Interagency agreements. -- The commission may enter into
interagency agreements with the Department of Environmental
Protection and the Division of Energy to carry out the
responsibilities set forth in this article.
(b) Alternative and renewable energy resource planning assessment. -- The commission, in cooperation with the Department
of Environmental Protection and the Division of Energy, shall
conduct an ongoing alternative and renewable energy resource
planning assessment for this state that shall, at a minimum: (i)
Identify current and operating alternative and renewable energy
resource facilities in this state; (ii) assess the potential to add
future generating capacity in this state from alternative and
renewable energy resource facilities; (iii) assess the conditions
of the alternative and renewable energy resource marketplace,
including costs associated with alternative and renewable energy;
(iv) assess the economic impacts of this article on coal and coal
mining in West Virginia; (v) recommend methods to maintain or
increase the relative competitiveness of the alternative and
renewable energy resource market in this state; and (v)(vi)
recommend to the Legislature additional compliance goals for
alternative and renewable energy portfolio standards beyond 2025.
The commission shall report the initial results of its
assessment to the Governor, the President of the Senate and the
Speaker of the House of Delegates within three years of the
effective date of this article and shall report the ongoing results
of the assessment on a yearly basis thereafter, except that on or
before January 1, 2012, the commission, in collaboration with the
Public Energy Authority, shall report the initial results of its
assessment to the Joint Committee on Government and Finance.
Email
Webmaster | © 2024 West Virginia Legislature **
