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1 | AN ACT concerning utilities.
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2 | Be it enacted by the People of the State of Illinois,
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3 | represented in the General Assembly:
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4 | Section 1. Short title. This Act may be referred to as
the | ||||||
5 | Thermal Energy Network and Jobs Act.
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6 | Section 5. Legislative findings and intent. | ||||||
7 | (a) The General Assembly finds and
declares that:
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8 | (1) This State has a strong interest in ensuring that | ||||||
9 | emissions of greenhouse gases from buildings are reduced | ||||||
10 | because buildings are one of this State's largest sources | ||||||
11 | of greenhouse gases due to the combustion of
fossil fuels | ||||||
12 | for heating, domestic hot water production, cooking, and | ||||||
13 | other end uses.
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14 | (2) The decarbonization of buildings must be pursued | ||||||
15 | in a manner that
is affordable and accessible, preserves | ||||||
16 | and creates living-wage jobs, and
retains the knowledge | ||||||
17 | and experience of the existing utility union workforce.
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18 | (3) Thermal energy networks have the potential to | ||||||
19 | decarbonize buildings
at the community and utility scale | ||||||
20 | and help achieve the goals of Public Act 102-662 (also | ||||||
21 | known as the Climate and Equitable Jobs Act).
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22 | (4) Thermal energy networks consist of pipe loops | ||||||
23 | between multiple
buildings and energy sources, which carry |
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1 | water and can be connected to by building owners to | ||||||
2 | support heating and cooling and hot water services. | ||||||
3 | Building owners can connect to the loops to support water
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4 | heating and cooling and hot water services.
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5 | (5) Many utilities in this State have been seeking to | ||||||
6 | develop thermal energy networks but have encountered legal | ||||||
7 | and regulatory barriers.
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8 | (6) This State has a strong interest in ensuring an | ||||||
9 | adequate supply
of reliable electrical power and, | ||||||
10 | therefore, needs to promote the development of alternative | ||||||
11 | power sources and take steps to assure reliable
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12 | deliverability. Thermal energy networks are highly | ||||||
13 | efficient because
they use and exchange thermal energy | ||||||
14 | from many underground sources
and buildings, including | ||||||
15 | recycled thermal energy, which minimizes impacts on
the | ||||||
16 | electricity grid.
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17 | (7) Access to thermal energy networks has the | ||||||
18 | potential to reduce the
upfront and operating costs of | ||||||
19 | building electrification for customers.
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20 | (8) A utility's access to capital, the utility's | ||||||
21 | experience with networked
infrastructure in public | ||||||
22 | rights-of-way, and the requirement that the utility
serve | ||||||
23 | all customers positions the utility well to develop and | ||||||
24 | scale thermal
energy networks that are accessible to all | ||||||
25 | customers and to coordinate
the development of thermal | ||||||
26 | energy networks with any orderly rightsizing of the
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1 | utility gas system.
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2 | (9) This State also has an interest in the efficient | ||||||
3 | and
reliable delivery of energy and the energy | ||||||
4 | infrastructure of the State,
which interest is | ||||||
5 | acknowledged throughout the Public Utilities Act. Utility | ||||||
6 | corporations and other power suppliers share these | ||||||
7 | interests and, moreover, have a duty to protect | ||||||
8 | proprietary interests in the projects they fund. Such | ||||||
9 | investments of ratepayer resources can be protected by | ||||||
10 | establishing effective contractor qualification and | ||||||
11 | performance standards, including requirements for | ||||||
12 | prevailing wage rates, bona fide apprenticeship criteria, | ||||||
13 | and project labor agreements.
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14 | (10) The construction industry is highly skilled and | ||||||
15 | labor intensive,
and the installation of modern thermal | ||||||
16 | energy networks involves particularly complex work. | ||||||
17 | Therefore, effective qualification standards
for craft | ||||||
18 | labor personnel employed on these projects are critically
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19 | needed to promote successful project delivery.
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20 | (11) Finally, these findings are especially vital now | ||||||
21 | because the construction industry is experiencing | ||||||
22 | widespread skill shortages across the country, which are | ||||||
23 | crippling existing capital projects and threatening | ||||||
24 | projects planned for the future. The construction of | ||||||
25 | thermal energy networks will utilize many of the same | ||||||
26 | skills that the current utility and building trades |
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1 | workforces already possess.
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2 | (b) It is the intent of the General Assembly that passage | ||||||
3 | of this Act is for the following purposes: | ||||||
4 | (1) to remove the legal barriers to utility | ||||||
5 | development of thermal
energy networks and require the | ||||||
6 | Illinois Commerce Commission, within 90 days after the | ||||||
7 | effective date of this amendatory Act of the 103rd General | ||||||
8 | Assembly, to begin to authorize and direct utilities to | ||||||
9 | immediately commence piloting thermal energy networks in | ||||||
10 | each and every utility territory;
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11 | (2) to direct and authorize the Illinois Commerce | ||||||
12 | Commission to develop a regulatory structure for utility | ||||||
13 | thermal energy networks that scales affordable and | ||||||
14 | accessible building electrification, protects customers, | ||||||
15 | and balances the role of incumbent monopoly utilities with | ||||||
16 | other market and public actors;
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17 | (3) to promote the successful planning and delivery of | ||||||
18 | thermal energy
networks and protect critical investments | ||||||
19 | in such projects by requiring the use of appropriate | ||||||
20 | quality craft labor policies that ensure the development | ||||||
21 | of and access to an adequate supply of well trained, | ||||||
22 | highly skilled craft persons needed to support timely, | ||||||
23 | reliable, high-quality projects;
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24 | (4) to promote strong economic development and good | ||||||
25 | jobs for local
residents in the expanding decarbonized | ||||||
26 | sector by requiring application of progressive State labor |
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1 | and employment policies that ensure public utility | ||||||
2 | investments and related State subsidies create | ||||||
3 | unparalleled skill training and employment opportunities | ||||||
4 | for residents in project areas through the use of local | ||||||
5 | prevailing wage standards and successful, bona fide | ||||||
6 | apprenticeship programs or project labor agreements that | ||||||
7 | incorporate prevailing wage and training standards and | ||||||
8 | provide additional benefits for project owners and | ||||||
9 | workers; and
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10 | (5) to promote the use of preapprenticeship programs | ||||||
11 | that will fortify and expand existing apprenticeship | ||||||
12 | programs through systematic outreach efforts to recruit | ||||||
13 | and assist persons from underrepresented and low income | ||||||
14 | communities by providing such persons with remedial | ||||||
15 | education, social services, and unique opportunities for | ||||||
16 | direct access into high-quality apprenticeship programs | ||||||
17 | and gainful employment in the growing building | ||||||
18 | decarbonization workforce.
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19 | Section 900. The Public Utilities Act is amended by | ||||||
20 | changing Sections 3-101 and by adding Sections 3-127, 3-128, | ||||||
21 | and 8-513 as follows:
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22 | (220 ILCS 5/3-101) (from Ch. 111 2/3, par. 3-101)
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23 | Sec. 3-101. Definitions. Unless otherwise specified, the | ||||||
24 | terms set forth
in Sections 3-102 through 3-128 3-126 are used |
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1 | in this Act as therein defined.
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2 | (Source: P.A. 97-96, eff. 7-13-11; 97-239, eff. 8-2-11; | ||||||
3 | 97-813, eff. 7-13-12.)
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4 | (220 ILCS 5/3-127 new) | ||||||
5 | Sec. 3-127. Thermal energy. "Thermal energy" means piped
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6 | noncombustible fluids used for transferring heat into and out | ||||||
7 | of buildings for the purpose of reducing any resultant
onsite | ||||||
8 | greenhouse gas emissions of all types of heating and cooling | ||||||
9 | processes, including, but not limited to, comfort heating and | ||||||
10 | cooling, domestic hot water, and refrigeration. | ||||||
11 | (220 ILCS 5/3-128 new) | ||||||
12 | Sec. 3-128. Thermal energy network. "Thermal energy
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13 | network" means all real estate, fixtures, and personal | ||||||
14 | property operated, owned, used, or to be used for, in | ||||||
15 | connection with, or to facilitate a utility-scale distribution | ||||||
16 | infrastructure project that supplies thermal energy. | ||||||
17 | (220 ILCS 5/8-513 new) | ||||||
18 | Sec. 8-513. Pilot thermal energy network development. | ||||||
19 | (a) The Illinois Commerce Commission shall initiate a | ||||||
20 | proceeding within 6 months after the effective date of this | ||||||
21 | amendatory Act of the 103rd General Assembly to support the | ||||||
22 | development of pilot thermal energy networks. The Commission | ||||||
23 | shall consider matters in the proceeding, including, but not |
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1 | limited to, the appropriate ownership, market, and rate | ||||||
2 | structures for pilot thermal energy networks and whether the | ||||||
3 | provision of thermal energy services by thermal network energy | ||||||
4 | providers is in the public interest. | ||||||
5 | (b) Within 12 months after the effective date of this | ||||||
6 | amendatory Act of the 103rd General Assembly, any gas public | ||||||
7 | utility, electric public utility, or combination public | ||||||
8 | utility serving over 100,000 customers shall file with the | ||||||
9 | Commission a petition seeking Commission approval of at least | ||||||
10 | one and no more than 3 proposed pilot thermal energy network | ||||||
11 | projects. Designs for the projects should coordinate and | ||||||
12 | maximize the value of existing State energy efficiency and | ||||||
13 | weatherization programs and take full advantage of federal | ||||||
14 | funding opportunities. No later than 18 months after the | ||||||
15 | effective date of this amendatory Act of the 103rd General | ||||||
16 | Assembly, the Commission shall enter an order approving, | ||||||
17 | approving with modification, or rejecting each proposed pilot | ||||||
18 | thermal energy network project and shall direct the public | ||||||
19 | utility to implement the pilot thermal energy network projects | ||||||
20 | as approved or approved as modified. In considering whether to | ||||||
21 | approve or approve as modified each pilot thermal energy | ||||||
22 | network project, the Commission shall consider whether the | ||||||
23 | pilot thermal energy network project is in the public | ||||||
24 | interest, whether the pilot thermal energy network project | ||||||
25 | will develop information useful for the Commission in adopting | ||||||
26 | rules governing thermal energy
networks, whether the pilot |
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1 | thermal energy network project furthers climate justice and | ||||||
2 | emissions reduction, whether the pilot thermal energy network | ||||||
3 | project advances financial and technical approaches to | ||||||
4 | equitable and
affordable building electrification, and whether | ||||||
5 | the pilot thermal energy network project creates benefits to | ||||||
6 | customers and society at large, including, but not limited to, | ||||||
7 | public health benefits in areas with disproportionate | ||||||
8 | environmental or public health burdens, job retention and | ||||||
9 | creation, reliability, and increased
affordability of | ||||||
10 | renewable thermal energy options. | ||||||
11 | (c) If a utility proposes 3 pilot thermal energy network | ||||||
12 | projects, at least one project shall be proposed in | ||||||
13 | economically disadvantaged communities and at least one shall | ||||||
14 | be focused on existing electric heat customers. Each public | ||||||
15 | utility shall coordinate with other public utilities and | ||||||
16 | consultants with expertise on successful pilot projects to | ||||||
17 | ensure that the pilot projects are diverse and designed to | ||||||
18 | inform the Commission's decisions in the proceeding on the | ||||||
19 | various ownership, market, and rate structures for thermal | ||||||
20 | energy networks. The pilot project proposals shall be made | ||||||
21 | publicly available on the Commission's website. | ||||||
22 | (d) Any gas public utility, electric public utility, or | ||||||
23 | combination public utility constructing or operating a | ||||||
24 | Commission-approved pilot thermal energy network project shall | ||||||
25 | report to the Commission, on a quarterly basis and until | ||||||
26 | completion of the pilot thermal energy network project, as |
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1 | determined by the Commission, the status of each pilot thermal | ||||||
2 | energy network project. The Commission shall post and make | ||||||
3 | publicly available the reports on its website. The report | ||||||
4 | shall include, but not be limited to: | ||||||
5 | (1) the stage of development of each pilot project; | ||||||
6 | (2) the barriers to development; | ||||||
7 | (3) the number of customers served; | ||||||
8 | (4) the costs of the pilot project; | ||||||
9 | (5) the number of jobs retained or created by the | ||||||
10 | pilot project; and | ||||||
11 | (6) any other information the Commission deems to
be | ||||||
12 | in the public interest or considers likely to prove useful | ||||||
13 | or relevant to the rulemaking described in subsection (h). | ||||||
14 | (e) Any gas public utility, electric public utility, or | ||||||
15 | combination public utility constructing or operating a | ||||||
16 | Commission-approved pilot thermal energy network project shall | ||||||
17 | demonstrate that it has entered into a labor peace agreement | ||||||
18 | with a bona fide labor organization that is actively engaged | ||||||
19 | in representing its employees. The labor peace agreement shall | ||||||
20 | apply to the employees necessary for the ongoing maintenance | ||||||
21 | and operation of the thermal energy network. The labor peace | ||||||
22 | agreement shall be an ongoing material condition of | ||||||
23 | authorization to maintain and operate the thermal energy | ||||||
24 | networks. | ||||||
25 | (f) Any contractor or subcontractor that performs work on
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26 | a pilot thermal energy network under this Section shall be a
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1 | responsible bidder as described in Section 30-22 of the
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2 | Illinois Procurement Code and shall certify that not less than | ||||||
3 | prevailing wage, as determined under the Prevailing Wage Act, | ||||||
4 | was or will be paid to employees who are engaged in | ||||||
5 | construction activities associated with the pilot thermal | ||||||
6 | energy network project. The contractor or subcontractor
shall | ||||||
7 | submit evidence to the Commission that it complied with the | ||||||
8 | requirements of this subsection. | ||||||
9 | (g) For any pending application for a thermal energy | ||||||
10 | network, the contractor or subcontractor shall submit evidence | ||||||
11 | that the contractor or subcontractor has entered into a fully | ||||||
12 | executed project labor agreement with the applicable local | ||||||
13 | building trades council. The Commission shall not approve any | ||||||
14 | pending applications until the contractor or subcontractor has | ||||||
15 | submitted the information required under this subsection. | ||||||
16 | (h) Within 4 years after the completion of the | ||||||
17 | construction of all thermal energy network projects under this | ||||||
18 | Section, the Commission shall adopt rules to, at a minimum: | ||||||
19 | (1) create fair market access rules for
thermal energy | ||||||
20 | networks to accept thermal energy and that do
not increase | ||||||
21 | greenhouse gas emissions or copollutants; | ||||||
22 | (2) to the extent it is in the public interest to do | ||||||
23 | so, exempt small-scale thermal energy networks from active | ||||||
24 | regulation by the Commission; | ||||||
25 | (3) promote the training and transition of utility
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26 | workers impacted by this amendatory Act of the 103rd
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1 | General Assembly; and | ||||||
2 | (4) encourage third-party participation and
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3 | competition where it will maximize benefits to customers. | ||||||
4 | (i) A gas public utility, electric public utility, or | ||||||
5 | combination public utility required to develop any pilot | ||||||
6 | thermal energy network project under this Section shall be | ||||||
7 | permitted to recover all reasonable and prudently incurred | ||||||
8 | costs associated with the development, construction, and | ||||||
9 | operation of one or more pilot thermal energy network projects | ||||||
10 | through general rates set pursuant to Section 9-201 or through | ||||||
11 | rates set in a Multi-Year Rate Plan pursuant to Section | ||||||
12 | 16-108.18.
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13 | Section 999. Effective date. This Act takes effect upon | ||||||
14 | becoming law.
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