Senate Bill No. 4008
(By Senators Tomblin (Mr. President) and Caruth,
By Request of the Executive)
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[Introduced November 17, 2009; referred to the Committee on the
Judiciary.]
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A BILL to amend and reenact §24-2F-3 and §24-2F-4 of the Code of
West Virginia, 1931, as amended, all relating to the
Alternative and Renewable Energy Portfolio Act; discontinuing
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, industry-recognized
alternative and renewable energy resource credit tracking
system; exempting certain credit pricing data from public
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; and allowing credits for certain energy
efficiency and demand-side projects undertaken pursuant to
federal requirements.
Be it enacted by the Legislature of West Virginia:
That §24-2F-3 and §24-2F-4 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,
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.
NOTE: The purpose of this bill is to amend a definition in the
Alternative and Renewable Energy Portfolio Act, to permit the
Public Service Commission (PSC) to utilize an independent and
industry-recognized alternative and renewable energy resource
credit tracking system, and to permit the PSC to utilize an
independent, industry recognized entity to verify and certify
greenhouse gas emission reduction or offset projects.
Strike-throughs indicate language that would be stricken from
the present law, and underscoring indicates new language that would
be added.
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