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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 5. The Illinois Power Agency Act is amended by | ||||||
5 | changing Sections 1-5, 1-20, and 1-75 as follows: | ||||||
6 | (20 ILCS 3855/1-5) | ||||||
7 | Sec. 1-5. Legislative declarations and findings. The | ||||||
8 | General Assembly finds and declares: | ||||||
9 | (1) The health, welfare, and prosperity of all Illinois | ||||||
10 | citizens require the provision of adequate, reliable, | ||||||
11 | affordable, efficient, and environmentally sustainable | ||||||
12 | electric service at the lowest total cost over time, taking | ||||||
13 | into account any benefits of price stability. | ||||||
14 | (2) The transition to retail competition is not | ||||||
15 | complete. Some customers, especially residential and small | ||||||
16 | commercial customers, have failed to benefit from lower | ||||||
17 | electricity costs from retail and wholesale competition. | ||||||
18 | (3) Escalating prices for electricity in Illinois pose | ||||||
19 | a serious threat to the economic well-being, health, and | ||||||
20 | safety of the residents of and the commerce and industry of | ||||||
21 | the State. | ||||||
22 | (4) To protect against this threat to economic | ||||||
23 | well-being, health, and safety it is necessary to improve |
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1 | the process of procuring electricity to serve Illinois | ||||||
2 | residents, to promote investment in energy efficiency and | ||||||
3 | demand-response measures, and to support development of | ||||||
4 | clean coal technologies and renewable resources. | ||||||
5 | (5) Procuring a diverse electricity supply portfolio | ||||||
6 | will ensure the lowest total cost over time for adequate, | ||||||
7 | reliable, efficient, and environmentally sustainable | ||||||
8 | electric service. | ||||||
9 | (6) Including cost-effective renewable resources in | ||||||
10 | that portfolio will reduce long-term direct and indirect | ||||||
11 | costs to consumers by decreasing environmental impacts and | ||||||
12 | by avoiding or delaying the need for new generation, | ||||||
13 | transmission, and distribution infrastructure. | ||||||
14 | (7) Energy efficiency, demand-response measures, and | ||||||
15 | renewable energy are resources currently underused in | ||||||
16 | Illinois. | ||||||
17 | (8) The State should encourage the use of advanced | ||||||
18 | clean coal technologies that capture and sequester carbon | ||||||
19 | dioxide emissions to advance environmental protection | ||||||
20 | goals and to demonstrate the viability of coal and | ||||||
21 | coal-derived fuels in a carbon-constrained economy. | ||||||
22 | The General Assembly therefore finds that it is necessary | ||||||
23 | to create the Illinois Power Agency and that the goals and | ||||||
24 | objectives of that Agency are to accomplish each of the | ||||||
25 | following: | ||||||
26 | (A) Develop electricity procurement plans to ensure |
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1 | adequate, reliable, affordable, efficient, and | ||||||
2 | environmentally sustainable electric service at the lowest | ||||||
3 | total cost over time, taking into account any benefits of | ||||||
4 | price stability, for electric utilities that on December | ||||||
5 | 31, 2005 provided electric service to at least 100,000 | ||||||
6 | customers in Illinois and for small multi-jurisdictional | ||||||
7 | electric utilities that (i) on December 31, 2005 served | ||||||
8 | less than 100,000 customers in Illinois and (ii) request a | ||||||
9 | procurement plan for their Illinois jurisdictional load . | ||||||
10 | The procurement plan shall be updated on an annual basis | ||||||
11 | and shall include renewable energy resources sufficient to | ||||||
12 | achieve the standards specified in this Act. | ||||||
13 | (B) Conduct competitive procurement processes to | ||||||
14 | procure the supply resources identified in the procurement | ||||||
15 | plan. | ||||||
16 | (C) Develop electric generation and co-generation | ||||||
17 | facilities that use indigenous coal or renewable | ||||||
18 | resources, or both, financed with bonds issued by the | ||||||
19 | Illinois Finance Authority. | ||||||
20 | (D) Supply electricity from the Agency's facilities at | ||||||
21 | cost to one or more of the following: municipal electric | ||||||
22 | systems, governmental aggregators, or rural electric | ||||||
23 | cooperatives in Illinois.
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24 | (Source: P.A. 95-481, eff. 8-28-07; 95-1027, eff. 6-1-09 .) | ||||||
25 | (20 ILCS 3855/1-20)
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1 | Sec. 1-20. General powers of the Agency. | ||||||
2 | (a) The Agency is authorized to do each of the following: | ||||||
3 | (1) Develop electricity procurement plans to ensure | ||||||
4 | adequate, reliable, affordable, efficient, and | ||||||
5 | environmentally sustainable electric service at the lowest | ||||||
6 | total cost over time, taking into account any benefits of | ||||||
7 | price stability, for electric utilities that on December | ||||||
8 | 31, 2005 provided electric service to at least 100,000 | ||||||
9 | customers in Illinois and for small multi-jurisdictional | ||||||
10 | electric utilities that (A) on December 31, 2005 served | ||||||
11 | less than 100,000 customers in Illinois and (B) request a | ||||||
12 | procurement plan for their Illinois jurisdictional load . | ||||||
13 | The procurement plans shall be updated on an annual basis | ||||||
14 | and shall include electricity generated from renewable | ||||||
15 | resources sufficient to achieve the standards specified in | ||||||
16 | this Act. | ||||||
17 | (2) Conduct competitive procurement processes to | ||||||
18 | procure the supply resources identified in the procurement | ||||||
19 | plan, pursuant to Section 16-111.5 of the Public Utilities | ||||||
20 | Act. | ||||||
21 | (3) Develop electric generation and co-generation | ||||||
22 | facilities that use indigenous coal or renewable | ||||||
23 | resources, or both, financed with bonds issued by the | ||||||
24 | Illinois Finance Authority. | ||||||
25 | (4) Supply electricity from the Agency's facilities at | ||||||
26 | cost to one or more of the following: municipal electric |
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1 | systems, governmental aggregators, or rural electric | ||||||
2 | cooperatives in Illinois. | ||||||
3 | (b) Except as otherwise limited by this Act, the Agency has | ||||||
4 | all of the powers necessary or convenient to carry out the | ||||||
5 | purposes and provisions of this Act, including without | ||||||
6 | limitation, each of the following: | ||||||
7 | (1) To have a corporate seal, and to alter that seal at | ||||||
8 | pleasure, and to use it by causing it or a facsimile to be | ||||||
9 | affixed or impressed or reproduced in any other manner. | ||||||
10 | (2) To use the services of the Illinois Finance | ||||||
11 | Authority necessary to carry out the Agency's purposes. | ||||||
12 | (3) To negotiate and enter into loan agreements and | ||||||
13 | other agreements with the Illinois Finance Authority. | ||||||
14 | (4) To obtain and employ personnel and hire consultants | ||||||
15 | that are necessary to fulfill the Agency's purposes, and to | ||||||
16 | make expenditures for that purpose within the | ||||||
17 | appropriations for that purpose. | ||||||
18 | (5) To purchase, receive, take by grant, gift, devise, | ||||||
19 | bequest, or otherwise, lease, or otherwise acquire, own, | ||||||
20 | hold, improve, employ, use, and otherwise deal in and with, | ||||||
21 | real or personal property whether tangible or intangible, | ||||||
22 | or any interest therein, within the State. | ||||||
23 | (6) To acquire real or personal property, whether | ||||||
24 | tangible or intangible, including without limitation | ||||||
25 | property rights, interests in property, franchises, | ||||||
26 | obligations, contracts, and debt and equity securities, |
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1 | and to do so by the exercise of the power of eminent domain | ||||||
2 | in accordance with Section 1-21; except that any real | ||||||
3 | property acquired by the exercise of the power of eminent | ||||||
4 | domain must be located within the State. | ||||||
5 | (7) To sell, convey, lease, exchange, transfer, | ||||||
6 | abandon, or otherwise dispose of, or mortgage, pledge, or | ||||||
7 | create a security interest in, any of its assets, | ||||||
8 | properties, or any interest therein, wherever situated. | ||||||
9 | (8) To purchase, take, receive, subscribe for, or | ||||||
10 | otherwise acquire, hold, make a tender offer for, vote, | ||||||
11 | employ, sell, lend, lease, exchange, transfer, or | ||||||
12 | otherwise dispose of, mortgage, pledge, or grant a security | ||||||
13 | interest in, use, and otherwise deal in and with, bonds and | ||||||
14 | other obligations, shares, or other securities (or | ||||||
15 | interests therein) issued by others, whether engaged in a | ||||||
16 | similar or different business or activity. | ||||||
17 | (9) To make and execute agreements, contracts, and | ||||||
18 | other instruments necessary or convenient in the exercise | ||||||
19 | of the powers and functions of the Agency under this Act, | ||||||
20 | including contracts with any person, local government, | ||||||
21 | State agency, or other entity; and all State agencies and | ||||||
22 | all local governments are authorized to enter into and do | ||||||
23 | all things necessary to perform any such agreement, | ||||||
24 | contract, or other instrument with the Agency. No such | ||||||
25 | agreement, contract, or other instrument shall exceed 40 | ||||||
26 | years. |
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1 | (10) To lend money, invest and reinvest its funds in | ||||||
2 | accordance with the Public Funds Investment Act, and take | ||||||
3 | and hold real and personal property as security for the | ||||||
4 | payment of funds loaned or invested. | ||||||
5 | (11) To borrow money at such rate or rates of interest | ||||||
6 | as the Agency may determine, issue its notes, bonds, or | ||||||
7 | other obligations to evidence that indebtedness, and | ||||||
8 | secure any of its obligations by mortgage or pledge of its | ||||||
9 | real or personal property, machinery, equipment, | ||||||
10 | structures, fixtures, inventories, revenues, grants, and | ||||||
11 | other funds as provided or any interest therein, wherever | ||||||
12 | situated. | ||||||
13 | (12) To enter into agreements with the Illinois Finance | ||||||
14 | Authority to issue bonds whether or not the income | ||||||
15 | therefrom is exempt from federal taxation. | ||||||
16 | (13) To procure insurance against any loss in | ||||||
17 | connection with its properties or operations in such amount | ||||||
18 | or amounts and from such insurers, including the federal | ||||||
19 | government, as it may deem necessary or desirable, and to | ||||||
20 | pay any premiums therefor. | ||||||
21 | (14) To negotiate and enter into agreements with | ||||||
22 | trustees or receivers appointed by United States | ||||||
23 | bankruptcy courts or federal district courts or in other | ||||||
24 | proceedings involving adjustment of debts and authorize | ||||||
25 | proceedings involving adjustment of debts and authorize | ||||||
26 | legal counsel for the Agency to appear in any such |
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1 | proceedings. | ||||||
2 | (15) To file a petition under Chapter 9 of Title 11 of | ||||||
3 | the United States Bankruptcy Code or take other similar | ||||||
4 | action for the adjustment of its debts. | ||||||
5 | (16) To enter into management agreements for the | ||||||
6 | operation of any of the property or facilities owned by the | ||||||
7 | Agency. | ||||||
8 | (17) To enter into an agreement to transfer and to | ||||||
9 | transfer any land, facilities, fixtures, or equipment of | ||||||
10 | the Agency to one or more municipal electric systems, | ||||||
11 | governmental aggregators, or rural electric agencies or | ||||||
12 | cooperatives, for such consideration and upon such terms as | ||||||
13 | the Agency may determine to be in the best interest of the | ||||||
14 | citizens of Illinois. | ||||||
15 | (18) To enter upon any lands and within any building | ||||||
16 | whenever in its judgment it may be necessary for the | ||||||
17 | purpose of making surveys and examinations to accomplish | ||||||
18 | any purpose authorized by this Act. | ||||||
19 | (19) To maintain an office or offices at such place or | ||||||
20 | places in the State as it may determine. | ||||||
21 | (20) To request information, and to make any inquiry, | ||||||
22 | investigation, survey, or study that the Agency may deem | ||||||
23 | necessary to enable it effectively to carry out the | ||||||
24 | provisions of this Act. | ||||||
25 | (21) To accept and expend appropriations. | ||||||
26 | (22) To engage in any activity or operation that is |
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1 | incidental to and in furtherance of efficient operation to | ||||||
2 | accomplish the Agency's purposes. | ||||||
3 | (23) To adopt, revise, amend, and repeal rules with | ||||||
4 | respect to its operations, properties, and facilities as | ||||||
5 | may be necessary or convenient to carry out the purposes of | ||||||
6 | this Act, subject to the provisions of the Illinois | ||||||
7 | Administrative Procedure Act and Sections 1-22 and 1-35 of | ||||||
8 | this Act. | ||||||
9 | (24) To establish and collect charges and fees as | ||||||
10 | described in this Act.
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11 | (25) To manage procurement of substitute natural gas | ||||||
12 | from a facility that meets the criteria specified in | ||||||
13 | subsection (a) of Section 1-58 of this Act, on terms and | ||||||
14 | conditions that may be approved by the Agency pursuant to | ||||||
15 | subsection (d) of Section 1-58 of this Act, to support the | ||||||
16 | operations of State agencies and local governments that | ||||||
17 | agree to such terms and conditions. This procurement | ||||||
18 | process is not subject to the Procurement Code. | ||||||
19 | (Source: P.A. 95-481, eff. 8-28-07; 96-784, eff. 8-28-09; | ||||||
20 | 96-1000, eff. 7-2-10.) | ||||||
21 | (20 ILCS 3855/1-75) | ||||||
22 | Sec. 1-75. Planning and Procurement Bureau. The Planning | ||||||
23 | and Procurement Bureau has the following duties and | ||||||
24 | responsibilities: | ||||||
25 | (a) The Planning and Procurement Bureau shall each |
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1 | year, beginning in 2008, develop procurement plans and | ||||||
2 | conduct competitive procurement processes in accordance | ||||||
3 | with the requirements of Section 16-111.5 of the Public | ||||||
4 | Utilities Act for the eligible retail customers of electric | ||||||
5 | utilities that on December 31, 2005 provided electric | ||||||
6 | service to at least 100,000 customers in Illinois. The | ||||||
7 | Planning and Procurement Bureau shall also develop | ||||||
8 | procurement plans and conduct competitive procurement | ||||||
9 | processes in accordance with the requirements of Section | ||||||
10 | 16-111.5 of the Public Utilities Act for the eligible | ||||||
11 | retail customers of small multi-jurisdictional electric | ||||||
12 | utilities that (i) on December 31, 2005 served less than | ||||||
13 | 100,000 customers in Illinois and (ii) request a | ||||||
14 | procurement plan for their Illinois jurisdictional load. | ||||||
15 | This Section shall not apply to a small | ||||||
16 | multi-jurisdictional utility until such time as a small | ||||||
17 | multi-jurisdictional utility requests the Agency to | ||||||
18 | prepare a procurement plan for their Illinois | ||||||
19 | jurisdictional load. For the purposes of this Section, the | ||||||
20 | term "eligible retail customers" has the same definition as | ||||||
21 | found in Section 16-111.5(a) of the Public Utilities Act. | ||||||
22 | (1) The Agency shall each year, beginning in 2008, | ||||||
23 | as needed, issue a request for qualifications for | ||||||
24 | experts or expert consulting firms to develop the | ||||||
25 | procurement plans in accordance with Section 16-111.5 | ||||||
26 | of the Public Utilities Act. In order to qualify an |
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1 | expert or expert consulting firm must have: | ||||||
2 | (A) direct previous experience assembling | ||||||
3 | large-scale power supply plans or portfolios for | ||||||
4 | end-use customers; | ||||||
5 | (B) an advanced degree in economics, | ||||||
6 | mathematics, engineering, risk management, or a | ||||||
7 | related area of study; | ||||||
8 | (C) 10 years of experience in the electricity | ||||||
9 | sector, including managing supply risk; | ||||||
10 | (D) expertise in wholesale electricity market | ||||||
11 | rules, including those established by the Federal | ||||||
12 | Energy Regulatory Commission and regional | ||||||
13 | transmission organizations; | ||||||
14 | (E) expertise in credit protocols and | ||||||
15 | familiarity with contract protocols; | ||||||
16 | (F) adequate resources to perform and fulfill | ||||||
17 | the required functions and responsibilities; and | ||||||
18 | (G) the absence of a conflict of interest and | ||||||
19 | inappropriate bias for or against potential | ||||||
20 | bidders or the affected electric utilities. | ||||||
21 | (2) The Agency shall each year, as needed, issue a | ||||||
22 | request for qualifications for a procurement | ||||||
23 | administrator to conduct the competitive procurement | ||||||
24 | processes in accordance with Section 16-111.5 of the | ||||||
25 | Public Utilities Act. In order to qualify an expert or | ||||||
26 | expert consulting firm must have: |
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1 | (A) direct previous experience administering a | ||||||
2 | large-scale competitive procurement process; | ||||||
3 | (B) an advanced degree in economics, | ||||||
4 | mathematics, engineering, or a related area of | ||||||
5 | study; | ||||||
6 | (C) 10 years of experience in the electricity | ||||||
7 | sector, including risk management experience; | ||||||
8 | (D) expertise in wholesale electricity market | ||||||
9 | rules, including those established by the Federal | ||||||
10 | Energy Regulatory Commission and regional | ||||||
11 | transmission organizations; | ||||||
12 | (E) expertise in credit and contract | ||||||
13 | protocols; | ||||||
14 | (F) adequate resources to perform and fulfill | ||||||
15 | the required functions and responsibilities; and | ||||||
16 | (G) the absence of a conflict of interest and | ||||||
17 | inappropriate bias for or against potential | ||||||
18 | bidders or the affected electric utilities. | ||||||
19 | (3) The Agency shall provide affected utilities | ||||||
20 | and other interested parties with the lists of | ||||||
21 | qualified experts or expert consulting firms | ||||||
22 | identified through the request for qualifications | ||||||
23 | processes that are under consideration to develop the | ||||||
24 | procurement plans and to serve as the procurement | ||||||
25 | administrator. The Agency shall also provide each | ||||||
26 | qualified expert's or expert consulting firm's |
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1 | response to the request for qualifications. All | ||||||
2 | information provided under this subparagraph shall | ||||||
3 | also be provided to the Commission. The Agency may | ||||||
4 | provide by rule for fees associated with supplying the | ||||||
5 | information to utilities and other interested parties. | ||||||
6 | These parties shall, within 5 business days, notify the | ||||||
7 | Agency in writing if they object to any experts or | ||||||
8 | expert consulting firms on the lists. Objections shall | ||||||
9 | be based on: | ||||||
10 | (A) failure to satisfy qualification criteria; | ||||||
11 | (B) identification of a conflict of interest; | ||||||
12 | or | ||||||
13 | (C) evidence of inappropriate bias for or | ||||||
14 | against potential bidders or the affected | ||||||
15 | utilities. | ||||||
16 | The Agency shall remove experts or expert | ||||||
17 | consulting firms from the lists within 10 days if there | ||||||
18 | is a reasonable basis for an objection and provide the | ||||||
19 | updated lists to the affected utilities and other | ||||||
20 | interested parties. If the Agency fails to remove an | ||||||
21 | expert or expert consulting firm from a list, an | ||||||
22 | objecting party may seek review by the Commission | ||||||
23 | within 5 days thereafter by filing a petition, and the | ||||||
24 | Commission shall render a ruling on the petition within | ||||||
25 | 10 days. There is no right of appeal of the | ||||||
26 | Commission's ruling. |
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1 | (4) The Agency shall issue requests for proposals | ||||||
2 | to the qualified experts or expert consulting firms to | ||||||
3 | develop a procurement plan for the affected utilities | ||||||
4 | and to serve as procurement administrator. | ||||||
5 | (5) The Agency shall select an expert or expert | ||||||
6 | consulting firm to develop procurement plans based on | ||||||
7 | the proposals submitted and shall award one-year | ||||||
8 | contracts to those selected with an option for the | ||||||
9 | Agency for a one-year renewal. | ||||||
10 | (6) The Agency shall select an expert or expert | ||||||
11 | consulting firm, with approval of the Commission, to | ||||||
12 | serve as procurement administrator based on the | ||||||
13 | proposals submitted. If the Commission rejects, within | ||||||
14 | 5 days, the Agency's selection, the Agency shall submit | ||||||
15 | another recommendation within 3 days based on the | ||||||
16 | proposals submitted. The Agency shall award a one-year | ||||||
17 | contract to the expert or expert consulting firm so | ||||||
18 | selected with Commission approval with an option for | ||||||
19 | the Agency for a one-year renewal. | ||||||
20 | (b) The experts or expert consulting firms retained by | ||||||
21 | the Agency shall, as appropriate, prepare procurement | ||||||
22 | plans, and conduct a competitive procurement process as | ||||||
23 | prescribed in Section 16-111.5 of the Public Utilities Act, | ||||||
24 | to ensure adequate, reliable, affordable, efficient, and | ||||||
25 | environmentally sustainable electric service at the lowest | ||||||
26 | total cost over time, taking into account any benefits of |
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1 | price stability, for eligible retail customers of electric | ||||||
2 | utilities that on December 31, 2005 provided electric | ||||||
3 | service to at least 100,000 customers in the State of | ||||||
4 | Illinois , and for eligible Illinois retail customers of | ||||||
5 | small multi-jurisdictional electric utilities that (i) on | ||||||
6 | December 31, 2005 served less than 100,000 customers in | ||||||
7 | Illinois and (ii) request a procurement plan for their | ||||||
8 | Illinois jurisdictional load . | ||||||
9 | (c) Renewable portfolio standard. | ||||||
10 | (1) The procurement plans shall include | ||||||
11 | cost-effective renewable energy resources. A minimum | ||||||
12 | percentage of each utility's total supply to serve the | ||||||
13 | load of eligible retail customers, as defined in | ||||||
14 | Section 16-111.5(a) of the Public Utilities Act, | ||||||
15 | procured for each of the following years shall be | ||||||
16 | generated from cost-effective renewable energy | ||||||
17 | resources: at least 2% by June 1, 2008; at least 4% by | ||||||
18 | June 1, 2009; at least 5% by June 1, 2010; at least 6% | ||||||
19 | by June 1, 2011; at least 7% by June 1, 2012; at least | ||||||
20 | 8% by June 1, 2013; at least 9% by June 1, 2014; at | ||||||
21 | least 10% by June 1, 2015; and increasing by at least | ||||||
22 | 1.5% each year thereafter to at least 25% by June 1, | ||||||
23 | 2025. To the extent that it is available, at least 75% | ||||||
24 | of the renewable energy resources used to meet these | ||||||
25 | standards shall come from wind generation and, | ||||||
26 | beginning on June 1, 2011, at least the following |
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1 | percentages of the renewable energy resources used to | ||||||
2 | meet these standards shall come from photovoltaics on | ||||||
3 | the following schedule: 0.5% by June 1, 2012, 1.5% by | ||||||
4 | June 1, 2013; 3% by June 1, 2014; and 6% by June 1, | ||||||
5 | 2015 and thereafter. For purposes of this subsection | ||||||
6 | (c), "cost-effective" means that the costs of | ||||||
7 | procuring renewable energy resources do not cause the | ||||||
8 | limit stated in paragraph (2) of this subsection (c) to | ||||||
9 | be exceeded and do not exceed benchmarks based on | ||||||
10 | market prices for renewable energy resources in the | ||||||
11 | region, which shall be developed by the procurement | ||||||
12 | administrator, in consultation with the Commission | ||||||
13 | staff, Agency staff, and the procurement monitor and | ||||||
14 | shall be subject to Commission review and approval. | ||||||
15 | (2) For purposes of this subsection (c), the | ||||||
16 | required procurement of cost-effective renewable | ||||||
17 | energy resources for a particular year shall be | ||||||
18 | measured as a percentage of the actual amount of | ||||||
19 | electricity (megawatt-hours) supplied by the electric | ||||||
20 | utility to eligible retail customers in the planning | ||||||
21 | year ending immediately prior to the procurement. For | ||||||
22 | purposes of this subsection (c), the amount paid per | ||||||
23 | kilowatthour means the total amount paid for electric | ||||||
24 | service expressed on a per kilowatthour basis. For | ||||||
25 | purposes of this subsection (c), the total amount paid | ||||||
26 | for electric service includes without limitation |
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1 | amounts paid for supply, transmission, distribution, | ||||||
2 | surcharges, and add-on taxes. | ||||||
3 | Notwithstanding the requirements of this | ||||||
4 | subsection (c), the total of renewable energy | ||||||
5 | resources procured pursuant to the procurement plan | ||||||
6 | for any single year shall be reduced by an amount | ||||||
7 | necessary to limit the annual estimated average net | ||||||
8 | increase due to the costs of these resources included | ||||||
9 | in the amounts paid by eligible retail customers in | ||||||
10 | connection with electric service to: | ||||||
11 | (A) in 2008, no more than 0.5% of the amount | ||||||
12 | paid per kilowatthour by those customers during | ||||||
13 | the year ending May 31, 2007; | ||||||
14 | (B) in 2009, the greater of an additional 0.5% | ||||||
15 | of the amount paid per kilowatthour by those | ||||||
16 | customers during the year ending May 31, 2008 or 1% | ||||||
17 | of the amount paid per kilowatthour by those | ||||||
18 | customers during the year ending May 31, 2007; | ||||||
19 | (C) in 2010, the greater of an additional 0.5% | ||||||
20 | of the amount paid per kilowatthour by those | ||||||
21 | customers during the year ending May 31, 2009 or | ||||||
22 | 1.5% of the amount paid per kilowatthour by those | ||||||
23 | customers during the year ending May 31, 2007; | ||||||
24 | (D) in 2011, the greater of an additional 0.5% | ||||||
25 | of the amount paid per kilowatthour by those | ||||||
26 | customers during the year ending May 31, 2010 or 2% |
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1 | of the amount paid per kilowatthour by those | ||||||
2 | customers during the year ending May 31, 2007; and | ||||||
3 | (E) thereafter, the amount of renewable energy | ||||||
4 | resources procured pursuant to the procurement | ||||||
5 | plan for any single year shall be reduced by an | ||||||
6 | amount necessary to limit the estimated average | ||||||
7 | net increase due to the cost of these resources | ||||||
8 | included in the amounts paid by eligible retail | ||||||
9 | customers in connection with electric service to | ||||||
10 | no more than the greater of 2.015% of the amount | ||||||
11 | paid per kilowatthour by those customers during | ||||||
12 | the year ending May 31, 2007 or the incremental | ||||||
13 | amount per kilowatthour paid for these resources | ||||||
14 | in 2011. | ||||||
15 | No later than June 30, 2011, the Commission shall | ||||||
16 | review the limitation on the amount of renewable energy | ||||||
17 | resources procured pursuant to this subsection (c) and | ||||||
18 | report to the General Assembly its findings as to | ||||||
19 | whether that limitation unduly constrains the | ||||||
20 | procurement of cost-effective renewable energy | ||||||
21 | resources. | ||||||
22 | (3) Through June 1, 2011, renewable energy | ||||||
23 | resources shall be counted for the purpose of meeting | ||||||
24 | the renewable energy standards set forth in paragraph | ||||||
25 | (1) of this subsection (c) only if they are generated | ||||||
26 | from facilities located in the State, provided that |
| |||||||
| |||||||
1 | cost-effective renewable energy resources are | ||||||
2 | available from those facilities. If those | ||||||
3 | cost-effective resources are not available in | ||||||
4 | Illinois, they shall be procured in states that adjoin | ||||||
5 | Illinois and may be counted towards compliance. If | ||||||
6 | those cost-effective resources are not available in | ||||||
7 | Illinois or in states that adjoin Illinois, they shall | ||||||
8 | be purchased elsewhere and shall be counted towards | ||||||
9 | compliance. After June 1, 2011, cost-effective | ||||||
10 | renewable energy resources located in Illinois and in | ||||||
11 | states that adjoin Illinois may be counted towards | ||||||
12 | compliance with the standards set forth in paragraph | ||||||
13 | (1) of this subsection (c). If those cost-effective | ||||||
14 | resources are not available in Illinois or in states | ||||||
15 | that adjoin Illinois, they shall be purchased | ||||||
16 | elsewhere and shall be counted towards compliance. | ||||||
17 | (4) The electric utility shall retire all | ||||||
18 | renewable energy credits used to comply with the | ||||||
19 | standard. | ||||||
20 | (5) Beginning with the year commencing June 1, | ||||||
21 | 2010, an electric utility subject to this subsection | ||||||
22 | (c) shall apply the lesser of the maximum alternative | ||||||
23 | compliance payment rate or the most recent estimated | ||||||
24 | alternative compliance payment rate for its service | ||||||
25 | territory for the corresponding compliance period, | ||||||
26 | established pursuant to subsection (d) of Section |
| |||||||
| |||||||
1 | 16-115D of the Public Utilities Act to its retail | ||||||
2 | customers that take service pursuant to the electric | ||||||
3 | utility's hourly pricing tariff or tariffs. The | ||||||
4 | electric utility shall retain all amounts collected as | ||||||
5 | a result of the application of the alternative | ||||||
6 | compliance payment rate or rates to such customers, | ||||||
7 | and, beginning in 2011, the utility shall include in | ||||||
8 | the information provided under item (1) of subsection | ||||||
9 | (d) of Section 16-111.5 of the Public Utilities Act the | ||||||
10 | amounts collected under the alternative compliance | ||||||
11 | payment rate or rates for the prior year ending May 31. | ||||||
12 | Notwithstanding any limitation on the procurement of | ||||||
13 | renewable energy resources imposed by item (2) of this | ||||||
14 | subsection (c), the Agency shall increase its spending | ||||||
15 | on the purchase of renewable energy resources to be | ||||||
16 | procured by the electric utility for the next plan year | ||||||
17 | by an amount equal to the amounts collected by the | ||||||
18 | utility under the alternative compliance payment rate | ||||||
19 | or rates in the prior year ending May 31. | ||||||
20 | (d) Clean coal portfolio standard. | ||||||
21 | (1) The procurement plans shall include electricity | ||||||
22 | generated using clean coal. Each utility shall enter into | ||||||
23 | one or more sourcing agreements with the initial clean coal | ||||||
24 | facility, as provided in paragraph (3) of this subsection | ||||||
25 | (d), covering electricity generated by the initial clean | ||||||
26 | coal facility representing at least 5% of each utility's |
| |||||||
| |||||||
1 | total supply to serve the load of eligible retail customers | ||||||
2 | in 2015 and each year thereafter, as described in paragraph | ||||||
3 | (3) of this subsection (d), subject to the limits specified | ||||||
4 | in paragraph (2) of this subsection (d). It is the goal of | ||||||
5 | the State that by January 1, 2025, 25% of the electricity | ||||||
6 | used in the State shall be generated by cost-effective | ||||||
7 | clean coal facilities. For purposes of this subsection (d), | ||||||
8 | "cost-effective" means that the expenditures pursuant to | ||||||
9 | such sourcing agreements do not cause the limit stated in | ||||||
10 | paragraph (2) of this subsection (d) to be exceeded and do | ||||||
11 | not exceed cost-based benchmarks, which shall be developed | ||||||
12 | to assess all expenditures pursuant to such sourcing | ||||||
13 | agreements covering electricity generated by clean coal | ||||||
14 | facilities, other than the initial clean coal facility, by | ||||||
15 | the procurement administrator, in consultation with the | ||||||
16 | Commission staff, Agency staff, and the procurement | ||||||
17 | monitor and shall be subject to Commission review and | ||||||
18 | approval. | ||||||
19 | (A) A utility party to a sourcing agreement shall | ||||||
20 | immediately retire any emission credits that it | ||||||
21 | receives in connection with the electricity covered by | ||||||
22 | such agreement. | ||||||
23 | (B) Utilities shall maintain adequate records | ||||||
24 | documenting the purchases under the sourcing agreement | ||||||
25 | to comply with this subsection (d) and shall file an | ||||||
26 | accounting with the load forecast that must be filed |
| |||||||
| |||||||
1 | with the Agency by July 15 of each year, in accordance | ||||||
2 | with subsection (d) of Section 16-111.5 of the Public | ||||||
3 | Utilities Act. | ||||||
4 | (C) A utility shall be deemed to have complied with | ||||||
5 | the clean coal portfolio standard specified in this | ||||||
6 | subsection (d) if the utility enters into a sourcing | ||||||
7 | agreement as required by this subsection (d). | ||||||
8 | (2) For purposes of this subsection (d), the required | ||||||
9 | execution of sourcing agreements with the initial clean | ||||||
10 | coal facility for a particular year shall be measured as a | ||||||
11 | percentage of the actual amount of electricity | ||||||
12 | (megawatt-hours) supplied by the electric utility to | ||||||
13 | eligible retail customers in the planning year ending | ||||||
14 | immediately prior to the agreement's execution. For | ||||||
15 | purposes of this subsection (d), the amount paid per | ||||||
16 | kilowatthour means the total amount paid for electric | ||||||
17 | service expressed on a per kilowatthour basis. For purposes | ||||||
18 | of this subsection (d), the total amount paid for electric | ||||||
19 | service includes without limitation amounts paid for | ||||||
20 | supply, transmission, distribution, surcharges and add-on | ||||||
21 | taxes. | ||||||
22 | Notwithstanding the requirements of this subsection | ||||||
23 | (d), the total amount paid under sourcing agreements with | ||||||
24 | clean coal facilities pursuant to the procurement plan for | ||||||
25 | any given year shall be reduced by an amount necessary to | ||||||
26 | limit the annual estimated average net increase due to the |
| |||||||
| |||||||
1 | costs of these resources included in the amounts paid by | ||||||
2 | eligible retail customers in connection with electric | ||||||
3 | service to: | ||||||
4 | (A) in 2010, no more than 0.5% of the amount | ||||||
5 | paid per kilowatthour by those customers during | ||||||
6 | the year ending May 31, 2009; | ||||||
7 | (B) in 2011, the greater of an additional 0.5% | ||||||
8 | of the amount paid per kilowatthour by those | ||||||
9 | customers during the year ending May 31, 2010 or 1% | ||||||
10 | of the amount paid per kilowatthour by those | ||||||
11 | customers during the year ending May 31, 2009; | ||||||
12 | (C) in 2012, the greater of an additional 0.5% | ||||||
13 | of the amount paid per kilowatthour by those | ||||||
14 | customers during the year ending May 31, 2011 or | ||||||
15 | 1.5% of the amount paid per kilowatthour by those | ||||||
16 | customers during the year ending May 31, 2009; | ||||||
17 | (D) in 2013, the greater of an additional 0.5% | ||||||
18 | of the amount paid per kilowatthour by those | ||||||
19 | customers during the year ending May 31, 2012 or 2% | ||||||
20 | of the amount paid per kilowatthour by those | ||||||
21 | customers during the year ending May 31, 2009; and | ||||||
22 | (E) thereafter, the total amount paid under | ||||||
23 | sourcing agreements with clean coal facilities | ||||||
24 | pursuant to the procurement plan for any single | ||||||
25 | year shall be reduced by an amount necessary to | ||||||
26 | limit the estimated average net increase due to the |
| |||||||
| |||||||
1 | cost of these resources included in the amounts | ||||||
2 | paid by eligible retail customers in connection | ||||||
3 | with electric service to no more than the greater | ||||||
4 | of (i) 2.015% of the amount paid per kilowatthour | ||||||
5 | by those customers during the year ending May 31, | ||||||
6 | 2009 or (ii) the incremental amount per | ||||||
7 | kilowatthour paid for these resources in 2013. | ||||||
8 | These requirements may be altered only as provided | ||||||
9 | by statute.
No later than June 30, 2015, the | ||||||
10 | Commission shall review the limitation on the | ||||||
11 | total amount paid under sourcing agreements, if | ||||||
12 | any, with clean coal facilities pursuant to this | ||||||
13 | subsection (d) and report to the General Assembly | ||||||
14 | its findings as to whether that limitation unduly | ||||||
15 | constrains the amount of electricity generated by | ||||||
16 | cost-effective clean coal facilities that is | ||||||
17 | covered by sourcing agreements. | ||||||
18 | (3) Initial clean coal facility. In order to promote | ||||||
19 | development of clean coal facilities in Illinois, each | ||||||
20 | electric utility subject to this Section shall execute a | ||||||
21 | sourcing agreement to source electricity from a proposed | ||||||
22 | clean coal facility in Illinois (the "initial clean coal | ||||||
23 | facility") that will have a nameplate capacity of at least | ||||||
24 | 500 MW when commercial operation commences, that has a | ||||||
25 | final Clean Air Act permit on the effective date of this | ||||||
26 | amendatory Act of the 95th General Assembly, and that will |
| |||||||
| |||||||
1 | meet the definition of clean coal facility in Section 1-10 | ||||||
2 | of this Act when commercial operation commences. The | ||||||
3 | sourcing agreements with this initial clean coal facility | ||||||
4 | shall be subject to both approval of the initial clean coal | ||||||
5 | facility by the General Assembly and satisfaction of the | ||||||
6 | requirements of paragraph (4) of this subsection (d) and | ||||||
7 | shall be executed within 90 days after any such approval by | ||||||
8 | the General Assembly. The Agency and the Commission shall | ||||||
9 | have authority to inspect all books and records associated | ||||||
10 | with the initial clean coal facility during the term of | ||||||
11 | such a sourcing agreement. A utility's sourcing agreement | ||||||
12 | for electricity produced by the initial clean coal facility | ||||||
13 | shall include: | ||||||
14 | (A) a formula contractual price (the "contract | ||||||
15 | price") approved pursuant to paragraph (4) of this | ||||||
16 | subsection (d), which shall: | ||||||
17 | (i) be determined using a cost of service | ||||||
18 | methodology employing either a level or deferred | ||||||
19 | capital recovery component, based on a capital | ||||||
20 | structure consisting of 45% equity and 55% debt, | ||||||
21 | and a return on equity as may be approved by the | ||||||
22 | Federal Energy Regulatory Commission, which in any | ||||||
23 | case may not exceed the lower of 11.5% or the rate | ||||||
24 | of return approved by the General Assembly | ||||||
25 | pursuant to paragraph (4) of this subsection (d); | ||||||
26 | and |
| |||||||
| |||||||
1 | (ii) provide that all miscellaneous net | ||||||
2 | revenue, including but not limited to net revenue | ||||||
3 | from the sale of emission allowances, if any, | ||||||
4 | substitute natural gas, if any, grants or other | ||||||
5 | support provided by the State of Illinois or the | ||||||
6 | United States Government, firm transmission | ||||||
7 | rights, if any, by-products produced by the | ||||||
8 | facility, energy or capacity derived from the | ||||||
9 | facility and not covered by a sourcing agreement | ||||||
10 | pursuant to paragraph (3) of this subsection (d) or | ||||||
11 | item (5) of subsection (d) of Section 16-115 of the | ||||||
12 | Public Utilities Act, whether generated from the | ||||||
13 | synthesis gas derived from coal, from SNG, or from | ||||||
14 | natural gas, shall be credited against the revenue | ||||||
15 | requirement for this initial clean coal facility; | ||||||
16 | (B) power purchase provisions, which shall: | ||||||
17 | (i) provide that the utility party to such | ||||||
18 | sourcing agreement shall pay the contract price | ||||||
19 | for electricity delivered under such sourcing | ||||||
20 | agreement; | ||||||
21 | (ii) require delivery of electricity to the | ||||||
22 | regional transmission organization market of the | ||||||
23 | utility that is party to such sourcing agreement; | ||||||
24 | (iii) require the utility party to such | ||||||
25 | sourcing agreement to buy from the initial clean | ||||||
26 | coal facility in each hour an amount of energy |
| |||||||
| |||||||
1 | equal to all clean coal energy made available from | ||||||
2 | the initial clean coal facility during such hour | ||||||
3 | times a fraction, the numerator of which is such | ||||||
4 | utility's retail market sales of electricity | ||||||
5 | (expressed in kilowatthours sold) in the State | ||||||
6 | during the prior calendar month and the | ||||||
7 | denominator of which is the total retail market | ||||||
8 | sales of electricity (expressed in kilowatthours | ||||||
9 | sold) in the State by utilities during such prior | ||||||
10 | month and the sales of electricity (expressed in | ||||||
11 | kilowatthours sold) in the State by alternative | ||||||
12 | retail electric suppliers during such prior month | ||||||
13 | that are subject to the requirements of this | ||||||
14 | subsection (d) and paragraph (5) of subsection (d) | ||||||
15 | of Section 16-115 of the Public Utilities Act, | ||||||
16 | provided that the amount purchased by the utility | ||||||
17 | in any year will be limited by paragraph (2) of | ||||||
18 | this subsection (d); and | ||||||
19 | (iv) be considered pre-existing contracts in | ||||||
20 | such utility's procurement plans for eligible | ||||||
21 | retail customers; | ||||||
22 | (C) contract for differences provisions, which | ||||||
23 | shall: | ||||||
24 | (i) require the utility party to such sourcing | ||||||
25 | agreement to contract with the initial clean coal | ||||||
26 | facility in each hour with respect to an amount of |
| |||||||
| |||||||
1 | energy equal to all clean coal energy made | ||||||
2 | available from the initial clean coal facility | ||||||
3 | during such hour times a fraction, the numerator of | ||||||
4 | which is such utility's retail market sales of | ||||||
5 | electricity (expressed in kilowatthours sold) in | ||||||
6 | the utility's service territory in the State | ||||||
7 | during the prior calendar month and the | ||||||
8 | denominator of which is the total retail market | ||||||
9 | sales of electricity (expressed in kilowatthours | ||||||
10 | sold) in the State by utilities during such prior | ||||||
11 | month and the sales of electricity (expressed in | ||||||
12 | kilowatthours sold) in the State by alternative | ||||||
13 | retail electric suppliers during such prior month | ||||||
14 | that are subject to the requirements of this | ||||||
15 | subsection (d) and paragraph (5) of subsection (d) | ||||||
16 | of Section 16-115 of the Public Utilities Act, | ||||||
17 | provided that the amount paid by the utility in any | ||||||
18 | year will be limited by paragraph (2) of this | ||||||
19 | subsection (d); | ||||||
20 | (ii) provide that the utility's payment | ||||||
21 | obligation in respect of the quantity of | ||||||
22 | electricity determined pursuant to the preceding | ||||||
23 | clause (i) shall be limited to an amount equal to | ||||||
24 | (1) the difference between the contract price | ||||||
25 | determined pursuant to subparagraph (A) of | ||||||
26 | paragraph (3) of this subsection (d) and the |
| |||||||
| |||||||
1 | day-ahead price for electricity delivered to the | ||||||
2 | regional transmission organization market of the | ||||||
3 | utility that is party to such sourcing agreement | ||||||
4 | (or any successor delivery point at which such | ||||||
5 | utility's supply obligations are financially | ||||||
6 | settled on an hourly basis) (the "reference | ||||||
7 | price") on the day preceding the day on which the | ||||||
8 | electricity is delivered to the initial clean coal | ||||||
9 | facility busbar, multiplied by (2) the quantity of | ||||||
10 | electricity determined pursuant to the preceding | ||||||
11 | clause (i); and | ||||||
12 | (iii) not require the utility to take physical | ||||||
13 | delivery of the electricity produced by the | ||||||
14 | facility; | ||||||
15 | (D) general provisions, which shall: | ||||||
16 | (i) specify a term of no more than 30 years, | ||||||
17 | commencing on the commercial operation date of the | ||||||
18 | facility; | ||||||
19 | (ii) provide that utilities shall maintain | ||||||
20 | adequate records documenting purchases under the | ||||||
21 | sourcing agreements entered into to comply with | ||||||
22 | this subsection (d) and shall file an accounting | ||||||
23 | with the load forecast that must be filed with the | ||||||
24 | Agency by July 15 of each year, in accordance with | ||||||
25 | subsection (d) of Section 16-111.5 of the Public | ||||||
26 | Utilities Act. |
| |||||||
| |||||||
1 | (iii) provide that all costs associated with | ||||||
2 | the initial clean coal facility will be | ||||||
3 | periodically reported to the Federal Energy | ||||||
4 | Regulatory Commission and to purchasers in | ||||||
5 | accordance with applicable laws governing | ||||||
6 | cost-based wholesale power contracts; | ||||||
7 | (iv) permit the Illinois Power Agency to | ||||||
8 | assume ownership of the initial clean coal | ||||||
9 | facility, without monetary consideration and | ||||||
10 | otherwise on reasonable terms acceptable to the | ||||||
11 | Agency, if the Agency so requests no less than 3 | ||||||
12 | years prior to the end of the stated contract term; | ||||||
13 | (v) require the owner of the initial clean coal | ||||||
14 | facility to provide documentation to the | ||||||
15 | Commission each year, starting in the facility's | ||||||
16 | first year of commercial operation, accurately | ||||||
17 | reporting the quantity of carbon emissions from | ||||||
18 | the facility that have been captured and | ||||||
19 | sequestered and report any quantities of carbon | ||||||
20 | released from the site or sites at which carbon | ||||||
21 | emissions were sequestered in prior years, based | ||||||
22 | on continuous monitoring of such sites. If, in any | ||||||
23 | year after the first year of commercial operation, | ||||||
24 | the owner of the facility fails to demonstrate that | ||||||
25 | the initial clean coal facility captured and | ||||||
26 | sequestered at least 50% of the total carbon |
| |||||||
| |||||||
1 | emissions that the facility would otherwise emit | ||||||
2 | or that sequestration of emissions from prior | ||||||
3 | years has failed, resulting in the release of | ||||||
4 | carbon dioxide into the atmosphere, the owner of | ||||||
5 | the facility must offset excess emissions. Any | ||||||
6 | such carbon offsets must be permanent, additional, | ||||||
7 | verifiable, real, located within the State of | ||||||
8 | Illinois, and legally and practicably enforceable. | ||||||
9 | The cost of such offsets for the facility that are | ||||||
10 | not recoverable shall not exceed $15 million in any | ||||||
11 | given year. No costs of any such purchases of | ||||||
12 | carbon offsets may be recovered from a utility or | ||||||
13 | its customers. All carbon offsets purchased for | ||||||
14 | this purpose and any carbon emission credits | ||||||
15 | associated with sequestration of carbon from the | ||||||
16 | facility must be permanently retired. The initial | ||||||
17 | clean coal facility shall not forfeit its | ||||||
18 | designation as a clean coal facility if the | ||||||
19 | facility fails to fully comply with the applicable | ||||||
20 | carbon sequestration requirements in any given | ||||||
21 | year, provided the requisite offsets are | ||||||
22 | purchased. However, the Attorney General, on | ||||||
23 | behalf of the People of the State of Illinois, may | ||||||
24 | specifically enforce the facility's sequestration | ||||||
25 | requirement and the other terms of this contract | ||||||
26 | provision. Compliance with the sequestration |
| |||||||
| |||||||
1 | requirements and offset purchase requirements | ||||||
2 | specified in paragraph (3) of this subsection (d) | ||||||
3 | shall be reviewed annually by an independent | ||||||
4 | expert retained by the owner of the initial clean | ||||||
5 | coal facility, with the advance written approval | ||||||
6 | of the Attorney General. The Commission may, in the | ||||||
7 | course of the review specified in item (vii), | ||||||
8 | reduce the allowable return on equity for the | ||||||
9 | facility if the facility wilfully fails to comply | ||||||
10 | with the carbon capture and sequestration | ||||||
11 | requirements set forth in this item (v); | ||||||
12 | (vi) include limits on, and accordingly | ||||||
13 | provide for modification of, the amount the | ||||||
14 | utility is required to source under the sourcing | ||||||
15 | agreement consistent with paragraph (2) of this | ||||||
16 | subsection (d); | ||||||
17 | (vii) require Commission review: (1) to | ||||||
18 | determine the justness, reasonableness, and | ||||||
19 | prudence of the inputs to the formula referenced in | ||||||
20 | subparagraphs (A)(i) through (A)(iii) of paragraph | ||||||
21 | (3) of this subsection (d), prior to an adjustment | ||||||
22 | in those inputs including, without limitation, the | ||||||
23 | capital structure and return on equity, fuel | ||||||
24 | costs, and other operations and maintenance costs | ||||||
25 | and (2) to approve the costs to be passed through | ||||||
26 | to customers under the sourcing agreement by which |
| |||||||
| |||||||
1 | the utility satisfies its statutory obligations. | ||||||
2 | Commission review shall occur no less than every 3 | ||||||
3 | years, regardless of whether any adjustments have | ||||||
4 | been proposed, and shall be completed within 9 | ||||||
5 | months; | ||||||
6 | (viii) limit the utility's obligation to such | ||||||
7 | amount as the utility is allowed to recover through | ||||||
8 | tariffs filed with the Commission, provided that | ||||||
9 | neither the clean coal facility nor the utility | ||||||
10 | waives any right to assert federal pre-emption or | ||||||
11 | any other argument in response to a purported | ||||||
12 | disallowance of recovery costs; | ||||||
13 | (ix) limit the utility's or alternative retail | ||||||
14 | electric supplier's obligation to incur any | ||||||
15 | liability until such time as the facility is in | ||||||
16 | commercial operation and generating power and | ||||||
17 | energy and such power and energy is being delivered | ||||||
18 | to the facility busbar; | ||||||
19 | (x) provide that the owner or owners of the | ||||||
20 | initial clean coal facility, which is the | ||||||
21 | counterparty to such sourcing agreement, shall | ||||||
22 | have the right from time to time to elect whether | ||||||
23 | the obligations of the utility party thereto shall | ||||||
24 | be governed by the power purchase provisions or the | ||||||
25 | contract for differences provisions; | ||||||
26 | (xi) append documentation showing that the |
| |||||||
| |||||||
1 | formula rate and contract, insofar as they relate | ||||||
2 | to the power purchase provisions, have been | ||||||
3 | approved by the Federal Energy Regulatory | ||||||
4 | Commission pursuant to Section 205 of the Federal | ||||||
5 | Power Act; | ||||||
6 | (xii) provide that any changes to the terms of | ||||||
7 | the contract, insofar as such changes relate to the | ||||||
8 | power purchase provisions, are subject to review | ||||||
9 | under the public interest standard applied by the | ||||||
10 | Federal Energy Regulatory Commission pursuant to | ||||||
11 | Sections 205 and 206 of the Federal Power Act; and | ||||||
12 | (xiii) conform with customary lender | ||||||
13 | requirements in power purchase agreements used as | ||||||
14 | the basis for financing non-utility generators. | ||||||
15 | (4) Effective date of sourcing agreements with the | ||||||
16 | initial clean coal facility. Any proposed sourcing | ||||||
17 | agreement with the initial clean coal facility shall not | ||||||
18 | become effective unless the following reports are prepared | ||||||
19 | and submitted and authorizations and approvals obtained: | ||||||
20 | (i) Facility cost report. The owner of the | ||||||
21 | initial clean coal facility shall submit to the | ||||||
22 | Commission, the Agency, and the General Assembly a | ||||||
23 | front-end engineering and design study, a facility | ||||||
24 | cost report, method of financing (including but | ||||||
25 | not limited to structure and associated costs), | ||||||
26 | and an operating and maintenance cost quote for the |
| |||||||
| |||||||
1 | facility (collectively "facility cost report"), | ||||||
2 | which shall be prepared in accordance with the | ||||||
3 | requirements of this paragraph (4) of subsection | ||||||
4 | (d) of this Section, and shall provide the | ||||||
5 | Commission and the Agency access to the work | ||||||
6 | papers, relied upon documents, and any other | ||||||
7 | backup documentation related to the facility cost | ||||||
8 | report. | ||||||
9 | (ii) Commission report. Within 6 months | ||||||
10 | following receipt of the facility cost report, the | ||||||
11 | Commission, in consultation with the Agency, shall | ||||||
12 | submit a report to the General Assembly setting | ||||||
13 | forth its analysis of the facility cost report. | ||||||
14 | Such report shall include, but not be limited to, a | ||||||
15 | comparison of the costs associated with | ||||||
16 | electricity generated by the initial clean coal | ||||||
17 | facility to the costs associated with electricity | ||||||
18 | generated by other types of generation facilities, | ||||||
19 | an analysis of the rate impacts on residential and | ||||||
20 | small business customers over the life of the | ||||||
21 | sourcing agreements, and an analysis of the | ||||||
22 | likelihood that the initial clean coal facility | ||||||
23 | will commence commercial operation by and be | ||||||
24 | delivering power to the facility's busbar by 2016. | ||||||
25 | To assist in the preparation of its report, the | ||||||
26 | Commission, in consultation with the Agency, may |
| |||||||
| |||||||
1 | hire one or more experts or consultants, the costs | ||||||
2 | of which shall be paid for by the owner of the | ||||||
3 | initial clean coal facility. The Commission and | ||||||
4 | Agency may begin the process of selecting such | ||||||
5 | experts or consultants prior to receipt of the | ||||||
6 | facility cost report. | ||||||
7 | (iii) General Assembly approval. The proposed | ||||||
8 | sourcing agreements shall not take effect unless, | ||||||
9 | based on the facility cost report and the | ||||||
10 | Commission's report, the General Assembly enacts | ||||||
11 | authorizing legislation approving (A) the | ||||||
12 | projected price, stated in cents per kilowatthour, | ||||||
13 | to be charged for electricity generated by the | ||||||
14 | initial clean coal facility, (B) the projected | ||||||
15 | impact on residential and small business | ||||||
16 | customers' bills over the life of the sourcing | ||||||
17 | agreements, and (C) the maximum allowable return | ||||||
18 | on equity for the project; and | ||||||
19 | (iv) Commission review. If the General | ||||||
20 | Assembly enacts authorizing legislation pursuant | ||||||
21 | to subparagraph (iii) approving a sourcing | ||||||
22 | agreement, the Commission shall, within 90 days of | ||||||
23 | such enactment, complete a review of such sourcing | ||||||
24 | agreement. During such time period, the Commission | ||||||
25 | shall implement any directive of the General | ||||||
26 | Assembly, resolve any disputes between the parties |
| |||||||
| |||||||
1 | to the sourcing agreement concerning the terms of | ||||||
2 | such agreement, approve the form of such | ||||||
3 | agreement, and issue an order finding that the | ||||||
4 | sourcing agreement is prudent and reasonable. | ||||||
5 | The facility cost report shall be prepared as follows: | ||||||
6 | (A) The facility cost report shall be prepared by | ||||||
7 | duly licensed engineering and construction firms | ||||||
8 | detailing the estimated capital costs payable to one or | ||||||
9 | more contractors or suppliers for the engineering, | ||||||
10 | procurement and construction of the components | ||||||
11 | comprising the initial clean coal facility and the | ||||||
12 | estimated costs of operation and maintenance of the | ||||||
13 | facility. The facility cost report shall include: | ||||||
14 | (i) an estimate of the capital cost of the core | ||||||
15 | plant based on one or more front end engineering | ||||||
16 | and design studies for the gasification island and | ||||||
17 | related facilities. The core plant shall include | ||||||
18 | all civil, structural, mechanical, electrical, | ||||||
19 | control, and safety systems. | ||||||
20 | (ii) an estimate of the capital cost of the | ||||||
21 | balance of the plant, including any capital costs | ||||||
22 | associated with sequestration of carbon dioxide | ||||||
23 | emissions and all interconnects and interfaces | ||||||
24 | required to operate the facility, such as | ||||||
25 | transmission of electricity, construction or | ||||||
26 | backfeed power supply, pipelines to transport |
| |||||||
| |||||||
1 | substitute natural gas or carbon dioxide, potable | ||||||
2 | water supply, natural gas supply, water supply, | ||||||
3 | water discharge, landfill, access roads, and coal | ||||||
4 | delivery. | ||||||
5 | The quoted construction costs shall be expressed | ||||||
6 | in nominal dollars as of the date that the quote is | ||||||
7 | prepared and shall include (1) capitalized financing | ||||||
8 | costs during construction,
(2) taxes, insurance, and | ||||||
9 | other owner's costs, and (3) an assumed escalation in | ||||||
10 | materials and labor beyond the date as of which the | ||||||
11 | construction cost quote is expressed. | ||||||
12 | (B) The front end engineering and design study for | ||||||
13 | the gasification island and the cost study for the | ||||||
14 | balance of plant shall include sufficient design work | ||||||
15 | to permit quantification of major categories of | ||||||
16 | materials, commodities and labor hours, and receipt of | ||||||
17 | quotes from vendors of major equipment required to | ||||||
18 | construct and operate the clean coal facility. | ||||||
19 | (C) The facility cost report shall also include an | ||||||
20 | operating and maintenance cost quote that will provide | ||||||
21 | the estimated cost of delivered fuel, personnel, | ||||||
22 | maintenance contracts, chemicals, catalysts, | ||||||
23 | consumables, spares, and other fixed and variable | ||||||
24 | operations and maintenance costs. | ||||||
25 | (a) The delivered fuel cost estimate will be | ||||||
26 | provided by a recognized third party expert or |
| |||||||
| |||||||
1 | experts in the fuel and transportation industries. | ||||||
2 | (b) The balance of the operating and | ||||||
3 | maintenance cost quote, excluding delivered fuel | ||||||
4 | costs will be developed based on the inputs | ||||||
5 | provided by duly licensed engineering and | ||||||
6 | construction firms performing the construction | ||||||
7 | cost quote, potential vendors under long-term | ||||||
8 | service agreements and plant operating agreements, | ||||||
9 | or recognized third party plant operator or | ||||||
10 | operators. | ||||||
11 | The operating and maintenance cost quote | ||||||
12 | (including the cost of the front end engineering | ||||||
13 | and design study) shall be expressed in nominal | ||||||
14 | dollars as of the date that the quote is prepared | ||||||
15 | and shall include (1) taxes, insurance, and other | ||||||
16 | owner's costs, and (2) an assumed escalation in | ||||||
17 | materials and labor beyond the date as of which the | ||||||
18 | operating and maintenance cost quote is expressed. | ||||||
19 | (D) The facility cost report shall also include (i) | ||||||
20 | an analysis of the initial clean coal facility's | ||||||
21 | ability to deliver power and energy into the applicable | ||||||
22 | regional transmission organization markets and (ii) an | ||||||
23 | analysis of the expected capacity factor for the | ||||||
24 | initial clean coal facility. | ||||||
25 | (E) Amounts paid to third parties unrelated to the | ||||||
26 | owner or owners of the initial clean coal facility to |
| |||||||
| |||||||
1 | prepare the core plant construction cost quote, | ||||||
2 | including the front end engineering and design study, | ||||||
3 | and the operating and maintenance cost quote will be | ||||||
4 | reimbursed through Coal Development Bonds. | ||||||
5 | (5) Re-powering and retrofitting coal-fired power | ||||||
6 | plants previously owned by Illinois utilities to qualify as | ||||||
7 | clean coal facilities. During the 2009 procurement | ||||||
8 | planning process and thereafter, the Agency and the | ||||||
9 | Commission shall consider sourcing agreements covering | ||||||
10 | electricity generated by power plants that were previously | ||||||
11 | owned by Illinois utilities and that have been or will be | ||||||
12 | converted into clean coal facilities, as defined by Section | ||||||
13 | 1-10 of this Act. Pursuant to such procurement planning | ||||||
14 | process, the owners of such facilities may propose to the | ||||||
15 | Agency sourcing agreements with utilities and alternative | ||||||
16 | retail electric suppliers required to comply with | ||||||
17 | subsection (d) of this Section and item (5) of subsection | ||||||
18 | (d) of Section 16-115 of the Public Utilities Act, covering | ||||||
19 | electricity generated by such facilities. In the case of | ||||||
20 | sourcing agreements that are power purchase agreements, | ||||||
21 | the contract price for electricity sales shall be | ||||||
22 | established on a cost of service basis. In the case of | ||||||
23 | sourcing agreements that are contracts for differences, | ||||||
24 | the contract price from which the reference price is | ||||||
25 | subtracted shall be established on a cost of service basis. | ||||||
26 | The Agency and the Commission may approve any such utility |
| |||||||
| |||||||
1 | sourcing agreements that do not exceed cost-based | ||||||
2 | benchmarks developed by the procurement administrator, in | ||||||
3 | consultation with the Commission staff, Agency staff and | ||||||
4 | the procurement monitor, subject to Commission review and | ||||||
5 | approval. The Commission shall have authority to inspect | ||||||
6 | all books and records associated with these clean coal | ||||||
7 | facilities during the term of any such contract. | ||||||
8 | (6) Costs incurred under this subsection (d) or | ||||||
9 | pursuant to a contract entered into under this subsection | ||||||
10 | (d) shall be deemed prudently incurred and reasonable in | ||||||
11 | amount and the electric utility shall be entitled to full | ||||||
12 | cost recovery pursuant to the tariffs filed with the | ||||||
13 | Commission. | ||||||
14 | (e) The draft procurement plans are subject to public | ||||||
15 | comment, as required by Section 16-111.5 of the Public | ||||||
16 | Utilities Act. | ||||||
17 | (f) The Agency shall submit the final procurement plan | ||||||
18 | to the Commission. The Agency shall revise a procurement | ||||||
19 | plan if the Commission determines that it does not meet the | ||||||
20 | standards set forth in Section 16-111.5 of the Public | ||||||
21 | Utilities Act. | ||||||
22 | (g) The Agency shall assess fees to each affected | ||||||
23 | utility to recover the costs incurred in preparation of the | ||||||
24 | annual procurement plan for the utility. | ||||||
25 | (h) The Agency shall assess fees to each bidder to | ||||||
26 | recover the costs incurred in connection with a competitive |
| |||||||
| |||||||
1 | procurement process.
| ||||||
2 | (Source: P.A. 95-481, eff. 8-28-07; 95-1027, eff. 6-1-09; | ||||||
3 | 96-159, eff. 8-10-09; 96-1437, eff. 8-17-10.) | ||||||
4 | Section 10. The Public Utilities Act is amended by changing | ||||||
5 | Section 16-111.5 as follows: | ||||||
6 | (220 ILCS 5/16-111.5) | ||||||
7 | Sec. 16-111.5. Provisions relating to procurement. | ||||||
8 | (a) An electric utility that on December 31, 2005 served at | ||||||
9 | least 100,000 customers in Illinois shall procure power and | ||||||
10 | energy for its eligible retail customers in accordance with the | ||||||
11 | applicable provisions set forth in Section 1-75 of the Illinois | ||||||
12 | Power Agency Act and this Section. A small multi-jurisdictional | ||||||
13 | electric utility that on December 31, 2005 served less than | ||||||
14 | 100,000 customers in Illinois may elect to procure power and | ||||||
15 | energy for all or a portion of its eligible Illinois retail | ||||||
16 | customers in accordance with the applicable provisions set | ||||||
17 | forth in this Section and Section 1-75 of the Illinois Power | ||||||
18 | Agency Act. This Section shall not apply to a small | ||||||
19 | multi-jurisdictional utility until such time as a small | ||||||
20 | multi-jurisdictional utility requests the Illinois Power | ||||||
21 | Agency to prepare a procurement plan for its eligible retail | ||||||
22 | customers. "Eligible retail customers" for the purposes of this | ||||||
23 | Section means those retail customers that purchase power and | ||||||
24 | energy from the electric utility under fixed-price bundled |
| |||||||
| |||||||
1 | service tariffs, other than those retail customers whose | ||||||
2 | service is declared or deemed competitive under Section 16-113 | ||||||
3 | and those other customer groups specified in this Section, | ||||||
4 | including self-generating customers, customers electing hourly | ||||||
5 | pricing, or those customers who are otherwise ineligible for | ||||||
6 | fixed-price bundled tariff service. Those customers that are | ||||||
7 | excluded from the definition of "eligible retail customers" | ||||||
8 | shall not be included in the procurement plan load | ||||||
9 | requirements, and the utility shall procure any supply | ||||||
10 | requirements, including capacity, ancillary services, and | ||||||
11 | hourly priced energy, in the applicable markets as needed to | ||||||
12 | serve those customers, provided that the utility may include in | ||||||
13 | its procurement plan load requirements for the load that is | ||||||
14 | associated with those retail customers whose service has been | ||||||
15 | declared or deemed competitive pursuant to Section 16-113 of | ||||||
16 | this Act to the extent that those customers are purchasing | ||||||
17 | power and energy during one of the transition periods | ||||||
18 | identified in subsection (b) of Section 16-113 of this Act. | ||||||
19 | (b) A procurement plan shall be prepared for each electric | ||||||
20 | utility consistent with the applicable requirements of the | ||||||
21 | Illinois Power Agency Act and this Section. For purposes of | ||||||
22 | this Section, Illinois electric utilities that are affiliated | ||||||
23 | by virtue of a common parent company are considered to be a | ||||||
24 | single electric utility. Small multi-jurisdictional utilities | ||||||
25 | may request a procurement plan for a portion of or all of its | ||||||
26 | Illinois load. Each procurement plan shall analyze the |
| |||||||
| |||||||
1 | projected balance of supply and demand for eligible retail | ||||||
2 | customers over a 5-year period with the first planning year | ||||||
3 | beginning on June 1 of the year following the year in which the | ||||||
4 | plan is filed. The plan shall specifically identify the | ||||||
5 | wholesale products to be procured following plan approval, and | ||||||
6 | shall follow all the requirements set forth in the Public | ||||||
7 | Utilities Act and all applicable State and federal laws, | ||||||
8 | statutes, rules, or regulations, as well as Commission orders. | ||||||
9 | Nothing in this Section precludes consideration of contracts | ||||||
10 | longer than 5 years and related forecast data. Unless specified | ||||||
11 | otherwise in this Section, in the procurement plan or in the | ||||||
12 | implementing tariff, any procurement occurring in accordance | ||||||
13 | with this plan shall be competitively bid through a request for | ||||||
14 | proposals process. Approval and implementation of the | ||||||
15 | procurement plan shall be subject to review and approval by the | ||||||
16 | Commission according to the provisions set forth in this | ||||||
17 | Section. A procurement plan shall include each of the following | ||||||
18 | components: | ||||||
19 | (1) Hourly load analysis. This analysis shall include: | ||||||
20 | (i) multi-year historical analysis of hourly | ||||||
21 | loads; | ||||||
22 | (ii) switching trends and competitive retail | ||||||
23 | market analysis; | ||||||
24 | (iii) known or projected changes to future loads; | ||||||
25 | and | ||||||
26 | (iv) growth forecasts by customer class. |
| |||||||
| |||||||
1 | (2) Analysis of the impact of any demand side and | ||||||
2 | renewable energy initiatives. This analysis shall include: | ||||||
3 | (i) the impact of demand response programs and | ||||||
4 | energy efficiency programs , both current and | ||||||
5 | projected; for small multi-jurisdictional utilities, | ||||||
6 | the impact of demand response and energy efficiency | ||||||
7 | programs approved pursuant to Section 8-408 of this | ||||||
8 | Act, both current and projected; and | ||||||
9 | (ii) supply side needs that are projected to be | ||||||
10 | offset by purchases of renewable energy resources, if | ||||||
11 | any . ; and | ||||||
12 | (iii) the impact of energy efficiency programs, | ||||||
13 | both current and projected. | ||||||
14 | (3) A plan for meeting the expected load requirements | ||||||
15 | that will not be met through preexisting contracts. This | ||||||
16 | plan shall include: | ||||||
17 | (i) definitions of the different Illinois retail | ||||||
18 | customer classes for which supply is being purchased; | ||||||
19 | (ii) the proposed mix of demand-response products | ||||||
20 | for which contracts will be executed during the next | ||||||
21 | year. For small multi-jurisdictional electric | ||||||
22 | utilities that on December 31, 2005 served fewer than | ||||||
23 | 100,000 customers in Illinois, these shall be defined | ||||||
24 | as demand-response products offered in an energy | ||||||
25 | efficiency plan approved pursuant to Section 8-408 of | ||||||
26 | this Act. The cost-effective demand-response measures |
| |||||||
| |||||||
1 | shall be procured whenever the cost is lower than | ||||||
2 | procuring comparable capacity products, provided that | ||||||
3 | such products shall: | ||||||
4 | (A) be procured by a demand-response provider | ||||||
5 | from eligible retail customers; | ||||||
6 | (B) at least satisfy the demand-response | ||||||
7 | requirements of the regional transmission | ||||||
8 | organization market in which the utility's service | ||||||
9 | territory is located, including, but not limited | ||||||
10 | to, any applicable capacity or dispatch | ||||||
11 | requirements; | ||||||
12 | (C) provide for customers' participation in | ||||||
13 | the stream of benefits produced by the | ||||||
14 | demand-response products; | ||||||
15 | (D) provide for reimbursement by the | ||||||
16 | demand-response provider of the utility for any | ||||||
17 | costs incurred as a result of the failure of the | ||||||
18 | supplier of such products to perform its | ||||||
19 | obligations thereunder; and | ||||||
20 | (E) meet the same credit requirements as apply | ||||||
21 | to suppliers of capacity, in the applicable | ||||||
22 | regional transmission organization market; | ||||||
23 | (iii) monthly forecasted system supply | ||||||
24 | requirements, including expected minimum, maximum, and | ||||||
25 | average values for the planning period; | ||||||
26 | (iv) the proposed mix and selection of standard |
| |||||||
| |||||||
1 | wholesale products for which contracts will be | ||||||
2 | executed during the next year, separately or in | ||||||
3 | combination, to meet that portion of its load | ||||||
4 | requirements not met through pre-existing contracts, | ||||||
5 | including but not limited to monthly 5 x 16 peak period | ||||||
6 | block energy, monthly off-peak wrap energy, monthly 7 x | ||||||
7 | 24 energy, annual 5 x 16 energy, annual off-peak wrap | ||||||
8 | energy, annual 7 x 24 energy, monthly capacity, annual | ||||||
9 | capacity, peak load capacity obligations, capacity | ||||||
10 | purchase plan, and ancillary services; | ||||||
11 | (v) proposed term structures for each wholesale | ||||||
12 | product type included in the proposed procurement plan | ||||||
13 | portfolio of products; and | ||||||
14 | (vi) an assessment of the price risk, load | ||||||
15 | uncertainty, and other factors that are associated | ||||||
16 | with the proposed procurement plan; this assessment, | ||||||
17 | to the extent possible, shall include an analysis of | ||||||
18 | the following factors: contract terms, time frames for | ||||||
19 | securing products or services, fuel costs, weather | ||||||
20 | patterns, transmission costs, market conditions, and | ||||||
21 | the governmental regulatory environment; the proposed | ||||||
22 | procurement plan shall also identify alternatives for | ||||||
23 | those portfolio measures that are identified as having | ||||||
24 | significant price risk. | ||||||
25 | (4) Proposed procedures for balancing loads. The | ||||||
26 | procurement plan shall include, for load requirements |
| |||||||
| |||||||
1 | included in the procurement plan, the process for (i) | ||||||
2 | hourly balancing of supply and demand and (ii) the criteria | ||||||
3 | for portfolio re-balancing in the event of significant | ||||||
4 | shifts in load. | ||||||
5 | (c) The procurement process set forth in Section 1-75 of | ||||||
6 | the Illinois Power Agency Act and subsection (e) of this | ||||||
7 | Section shall be administered by a procurement administrator | ||||||
8 | and monitored by a procurement monitor. | ||||||
9 | (1) The procurement administrator shall: | ||||||
10 | (i) design the final procurement process in | ||||||
11 | accordance with Section 1-75 of the Illinois Power | ||||||
12 | Agency Act and subsection (e) of this Section following | ||||||
13 | Commission approval of the procurement plan; | ||||||
14 | (ii) develop benchmarks in accordance with | ||||||
15 | subsection (e)(3) to be used to evaluate bids; these | ||||||
16 | benchmarks shall be submitted to the Commission for | ||||||
17 | review and approval on a confidential basis prior to | ||||||
18 | the procurement event; | ||||||
19 | (iii) serve as the interface between the electric | ||||||
20 | utility and suppliers; | ||||||
21 | (iv) manage the bidder pre-qualification and | ||||||
22 | registration process; | ||||||
23 | (v) obtain the electric utilities' agreement to | ||||||
24 | the final form of all supply contracts and credit | ||||||
25 | collateral agreements; | ||||||
26 | (vi) administer the request for proposals process; |
| |||||||
| |||||||
1 | (vii) have the discretion to negotiate to | ||||||
2 | determine whether bidders are willing to lower the | ||||||
3 | price of bids that meet the benchmarks approved by the | ||||||
4 | Commission; any post-bid negotiations with bidders | ||||||
5 | shall be limited to price only and shall be completed | ||||||
6 | within 24 hours after opening the sealed bids and shall | ||||||
7 | be conducted in a fair and unbiased manner; in | ||||||
8 | conducting the negotiations, there shall be no | ||||||
9 | disclosure of any information derived from proposals | ||||||
10 | submitted by competing bidders; if information is | ||||||
11 | disclosed to any bidder, it shall be provided to all | ||||||
12 | competing bidders; | ||||||
13 | (viii) maintain confidentiality of supplier and | ||||||
14 | bidding information in a manner consistent with all | ||||||
15 | applicable laws, rules, regulations, and tariffs; | ||||||
16 | (ix) submit a confidential report to the | ||||||
17 | Commission recommending acceptance or rejection of | ||||||
18 | bids; | ||||||
19 | (x) notify the utility of contract counterparties | ||||||
20 | and contract specifics; and | ||||||
21 | (xi) administer related contingency procurement | ||||||
22 | events. | ||||||
23 | (2) The procurement monitor, who shall be retained by | ||||||
24 | the Commission, shall: | ||||||
25 | (i) monitor interactions among the procurement | ||||||
26 | administrator, suppliers, and utility; |
| |||||||
| |||||||
1 | (ii) monitor and report to the Commission on the | ||||||
2 | progress of the procurement process; | ||||||
3 | (iii) provide an independent confidential report | ||||||
4 | to the Commission regarding the results of the | ||||||
5 | procurement event; | ||||||
6 | (iv) assess compliance with the procurement plans | ||||||
7 | approved by the Commission for each utility that on | ||||||
8 | December 31, 2005 provided electric service to a least | ||||||
9 | 100,000 customers in Illinois and for each small | ||||||
10 | multi-jurisdictional utility that on December 31, 2005 | ||||||
11 | served less than 100,000 customers in Illinois ; | ||||||
12 | (v) preserve the confidentiality of supplier and | ||||||
13 | bidding information in a manner consistent with all | ||||||
14 | applicable laws, rules, regulations, and tariffs; | ||||||
15 | (vi) provide expert advice to the Commission and | ||||||
16 | consult with the procurement administrator regarding | ||||||
17 | issues related to procurement process design, rules, | ||||||
18 | protocols, and policy-related matters; and | ||||||
19 | (vii) consult with the procurement administrator | ||||||
20 | regarding the development and use of benchmark | ||||||
21 | criteria, standard form contracts, credit policies, | ||||||
22 | and bid documents. | ||||||
23 | (d) Except as provided in subsection (j), the planning | ||||||
24 | process shall be conducted as follows: | ||||||
25 | (1) Beginning in 2008, each Illinois utility procuring | ||||||
26 | power pursuant to this Section shall annually provide a |
| |||||||
| |||||||
1 | range of load forecasts to the Illinois Power Agency by | ||||||
2 | July 15 of each year, or such other date as may be required | ||||||
3 | by the Commission or Agency. The load forecasts shall cover | ||||||
4 | the 5-year procurement planning period for the next | ||||||
5 | procurement plan and shall include hourly data | ||||||
6 | representing a high-load, low-load and expected-load | ||||||
7 | scenario for the load of the eligible retail customers. The | ||||||
8 | utility shall provide supporting data and assumptions for | ||||||
9 | each of the scenarios.
| ||||||
10 | (2) Beginning in 2008, the Illinois Power Agency shall | ||||||
11 | prepare a procurement plan by August 15th of each year, or | ||||||
12 | such other date as may be required by the Commission. The | ||||||
13 | procurement plan shall identify the portfolio of | ||||||
14 | demand-response and power and energy products to be | ||||||
15 | procured. Cost-effective demand-response measures shall be | ||||||
16 | procured as set forth in item (iii) of subsection (b) of | ||||||
17 | this Section. Copies of the procurement plan shall be | ||||||
18 | posted and made publicly available on the Agency's and | ||||||
19 | Commission's websites, and copies shall also be provided to | ||||||
20 | each affected electric utility. An affected utility shall | ||||||
21 | have 30 days following the date of posting to provide | ||||||
22 | comment to the Agency on the procurement plan. Other | ||||||
23 | interested entities also may comment on the procurement | ||||||
24 | plan. All comments submitted to the Agency shall be | ||||||
25 | specific, supported by data or other detailed analyses, | ||||||
26 | and, if objecting to all or a portion of the procurement |
| |||||||
| |||||||
1 | plan, accompanied by specific alternative wording or | ||||||
2 | proposals. All comments shall be posted on the Agency's and | ||||||
3 | Commission's websites. During this 30-day comment period, | ||||||
4 | the Agency shall hold at least one public hearing within | ||||||
5 | each utility's service area for the purpose of receiving | ||||||
6 | public comment on the procurement plan. Within 14 days | ||||||
7 | following the end of the 30-day review period, the Agency | ||||||
8 | shall revise the procurement plan as necessary based on the | ||||||
9 | comments received and file the procurement plan with the | ||||||
10 | Commission and post the procurement plan on the websites. | ||||||
11 | (3) Within 5 days after the filing of the procurement | ||||||
12 | plan, any person objecting to the procurement plan shall | ||||||
13 | file an objection with the Commission. Within 10 days after | ||||||
14 | the filing, the Commission shall determine whether a | ||||||
15 | hearing is necessary. The Commission shall enter its order | ||||||
16 | confirming or modifying the procurement plan within 90 days | ||||||
17 | after the filing of the procurement plan by the Illinois | ||||||
18 | Power Agency. | ||||||
19 | (4) The Commission shall approve the procurement plan, | ||||||
20 | including expressly the forecast used in the procurement | ||||||
21 | plan, if the Commission determines that it will ensure | ||||||
22 | adequate, reliable, affordable, efficient, and | ||||||
23 | environmentally sustainable electric service at the lowest | ||||||
24 | total cost over time, taking into account any benefits of | ||||||
25 | price stability. | ||||||
26 | (e) The procurement process shall include each of the |
| |||||||
| |||||||
1 | following components: | ||||||
2 | (1) Solicitation, pre-qualification, and registration | ||||||
3 | of bidders. The procurement administrator shall | ||||||
4 | disseminate information to potential bidders to promote a | ||||||
5 | procurement event, notify potential bidders that the | ||||||
6 | procurement administrator may enter into a post-bid price | ||||||
7 | negotiation with bidders that meet the applicable | ||||||
8 | benchmarks, provide supply requirements, and otherwise | ||||||
9 | explain the competitive procurement process. In addition | ||||||
10 | to such other publication as the procurement administrator | ||||||
11 | determines is appropriate, this information shall be | ||||||
12 | posted on the Illinois Power Agency's and the Commission's | ||||||
13 | websites. The procurement administrator shall also | ||||||
14 | administer the prequalification process, including | ||||||
15 | evaluation of credit worthiness, compliance with | ||||||
16 | procurement rules, and agreement to the standard form | ||||||
17 | contract developed pursuant to paragraph (2) of this | ||||||
18 | subsection (e). The procurement administrator shall then | ||||||
19 | identify and register bidders to participate in the | ||||||
20 | procurement event. | ||||||
21 | (2) Standard contract forms and credit terms and | ||||||
22 | instruments. The procurement administrator, in | ||||||
23 | consultation with the utilities, the Commission, and other | ||||||
24 | interested parties and subject to Commission oversight, | ||||||
25 | shall develop and provide standard contract forms for the | ||||||
26 | supplier contracts that meet generally accepted industry |
| |||||||
| |||||||
1 | practices. Standard credit terms and instruments that meet | ||||||
2 | generally accepted industry practices shall be similarly | ||||||
3 | developed. The procurement administrator shall make | ||||||
4 | available to the Commission all written comments it | ||||||
5 | receives on the contract forms, credit terms, or | ||||||
6 | instruments. If the procurement administrator cannot reach | ||||||
7 | agreement with the applicable electric utility as to the | ||||||
8 | contract terms and conditions, the procurement | ||||||
9 | administrator must notify the Commission of any disputed | ||||||
10 | terms and the Commission shall resolve the dispute. The | ||||||
11 | terms of the contracts shall not be subject to negotiation | ||||||
12 | by winning bidders, and the bidders must agree to the terms | ||||||
13 | of the contract in advance so that winning bids are | ||||||
14 | selected solely on the basis of price. | ||||||
15 | (3) Establishment of a market-based price benchmark. | ||||||
16 | As part of the development of the procurement process, the | ||||||
17 | procurement administrator, in consultation with the | ||||||
18 | Commission staff, Agency staff, and the procurement | ||||||
19 | monitor, shall establish benchmarks for evaluating the | ||||||
20 | final prices in the contracts for each of the products that | ||||||
21 | will be procured through the procurement process. The | ||||||
22 | benchmarks shall be based on price data for similar | ||||||
23 | products for the same delivery period and same delivery | ||||||
24 | hub, or other delivery hubs after adjusting for that | ||||||
25 | difference. The price benchmarks may also be adjusted to | ||||||
26 | take into account differences between the information |
| |||||||
| |||||||
1 | reflected in the underlying data sources and the specific | ||||||
2 | products and procurement process being used to procure | ||||||
3 | power for the Illinois utilities. The benchmarks shall be | ||||||
4 | confidential but shall be provided to, and will be subject | ||||||
5 | to Commission review and approval, prior to a procurement | ||||||
6 | event. | ||||||
7 | (4) Request for proposals competitive procurement | ||||||
8 | process. The procurement administrator shall design and | ||||||
9 | issue a request for proposals to supply electricity in | ||||||
10 | accordance with each utility's procurement plan, as | ||||||
11 | approved by the Commission. The request for proposals shall | ||||||
12 | set forth a procedure for sealed, binding commitment | ||||||
13 | bidding with pay-as-bid settlement, and provision for | ||||||
14 | selection of bids on the basis of price. | ||||||
15 | (5) A plan for implementing contingencies in the event | ||||||
16 | of supplier default or failure of the procurement process | ||||||
17 | to fully meet the expected load requirement due to | ||||||
18 | insufficient supplier participation, Commission rejection | ||||||
19 | of results, or any other cause. | ||||||
20 | (i) Event of supplier default: In the event of | ||||||
21 | supplier default, the utility shall review the | ||||||
22 | contract of the defaulting supplier to determine if the | ||||||
23 | amount of supply is 200 megawatts or greater, and if | ||||||
24 | there are more than 60 days remaining of the contract | ||||||
25 | term. If both of these conditions are met, and the | ||||||
26 | default results in termination of the contract, the |
| |||||||
| |||||||
1 | utility shall immediately notify the Illinois Power | ||||||
2 | Agency that a request for proposals must be issued to | ||||||
3 | procure replacement power, and the procurement | ||||||
4 | administrator shall run an additional procurement | ||||||
5 | event. If the contracted supply of the defaulting | ||||||
6 | supplier is less than 200 megawatts or there are less | ||||||
7 | than 60 days remaining of the contract term, the | ||||||
8 | utility shall procure power and energy from the | ||||||
9 | applicable regional transmission organization market, | ||||||
10 | including ancillary services, capacity, and day-ahead | ||||||
11 | or real time energy, or both, for the duration of the | ||||||
12 | contract term to replace the contracted supply; | ||||||
13 | provided, however, that if a needed product is not | ||||||
14 | available through the regional transmission | ||||||
15 | organization market it shall be purchased from the | ||||||
16 | wholesale market. | ||||||
17 | (ii) Failure of the procurement process to fully | ||||||
18 | meet the expected load requirement: If the procurement | ||||||
19 | process fails to fully meet the expected load | ||||||
20 | requirement due to insufficient supplier participation | ||||||
21 | or due to a Commission rejection of the procurement | ||||||
22 | results, the procurement administrator, the | ||||||
23 | procurement monitor, and the Commission staff shall | ||||||
24 | meet within 10 days to analyze potential causes of low | ||||||
25 | supplier interest or causes for the Commission | ||||||
26 | decision. If changes are identified that would likely |
| |||||||
| |||||||
1 | result in increased supplier participation, or that | ||||||
2 | would address concerns causing the Commission to | ||||||
3 | reject the results of the prior procurement event, the | ||||||
4 | procurement administrator may implement those changes | ||||||
5 | and rerun the request for proposals process according | ||||||
6 | to a schedule determined by those parties and | ||||||
7 | consistent with Section 1-75 of the Illinois Power | ||||||
8 | Agency Act and this subsection. In any event, a new | ||||||
9 | request for proposals process shall be implemented by | ||||||
10 | the procurement administrator within 90 days after the | ||||||
11 | determination that the procurement process has failed | ||||||
12 | to fully meet the expected load requirement. | ||||||
13 | (iii) In all cases where there is insufficient | ||||||
14 | supply provided under contracts awarded through the | ||||||
15 | procurement process to fully meet the electric | ||||||
16 | utility's load requirement, the utility shall meet the | ||||||
17 | load requirement by procuring power and energy from the | ||||||
18 | applicable regional transmission organization market, | ||||||
19 | including ancillary services, capacity, and day-ahead | ||||||
20 | or real time energy or both; provided, however, that if | ||||||
21 | a needed product is not available through the regional | ||||||
22 | transmission organization market it shall be purchased | ||||||
23 | from the wholesale market. | ||||||
24 | (6) The procurement process described in this | ||||||
25 | subsection is exempt from the requirements of the Illinois | ||||||
26 | Procurement Code, pursuant to Section 20-10 of that Code. |
| |||||||
| |||||||
1 | (f) Within 2 business days after opening the sealed bids, | ||||||
2 | the procurement administrator shall submit a confidential | ||||||
3 | report to the Commission. The report shall contain the results | ||||||
4 | of the bidding for each of the products along with the | ||||||
5 | procurement administrator's recommendation for the acceptance | ||||||
6 | and rejection of bids based on the price benchmark criteria and | ||||||
7 | other factors observed in the process. The procurement monitor | ||||||
8 | also shall submit a confidential report to the Commission | ||||||
9 | within 2 business days after opening the sealed bids. The | ||||||
10 | report shall contain the procurement monitor's assessment of | ||||||
11 | bidder behavior in the process as well as an assessment of the | ||||||
12 | procurement administrator's compliance with the procurement | ||||||
13 | process and rules. The Commission shall review the confidential | ||||||
14 | reports submitted by the procurement administrator and | ||||||
15 | procurement monitor, and shall accept or reject the | ||||||
16 | recommendations of the procurement administrator within 2 | ||||||
17 | business days after receipt of the reports. | ||||||
18 | (g) Within 3 business days after the Commission decision | ||||||
19 | approving the results of a procurement event, the utility shall | ||||||
20 | enter into binding contractual arrangements with the winning | ||||||
21 | suppliers using the standard form contracts; except that the | ||||||
22 | utility shall not be required either directly or indirectly to | ||||||
23 | execute the contracts if a tariff that is consistent with | ||||||
24 | subsection (l) of this Section has not been approved and placed | ||||||
25 | into effect for that utility. | ||||||
26 | (h) The names of the successful bidders and the load |
| |||||||
| |||||||
1 | weighted average of the winning bid prices for each contract | ||||||
2 | type and for each contract term shall be made available to the | ||||||
3 | public at the time of Commission approval of a procurement | ||||||
4 | event. The Commission, the procurement monitor, the | ||||||
5 | procurement administrator, the Illinois Power Agency, and all | ||||||
6 | participants in the procurement process shall maintain the | ||||||
7 | confidentiality of all other supplier and bidding information | ||||||
8 | in a manner consistent with all applicable laws, rules, | ||||||
9 | regulations, and tariffs. Confidential information, including | ||||||
10 | the confidential reports submitted by the procurement | ||||||
11 | administrator and procurement monitor pursuant to subsection | ||||||
12 | (f) of this Section, shall not be made publicly available and | ||||||
13 | shall not be discoverable by any party in any proceeding, | ||||||
14 | absent a compelling demonstration of need, nor shall those | ||||||
15 | reports be admissible in any proceeding other than one for law | ||||||
16 | enforcement purposes. | ||||||
17 | (i) Within 2 business days after a Commission decision | ||||||
18 | approving the results of a procurement event or such other date | ||||||
19 | as may be required by the Commission from time to time, the | ||||||
20 | utility shall file for informational purposes with the | ||||||
21 | Commission its actual or estimated retail supply charges, as | ||||||
22 | applicable, by customer supply group reflecting the costs | ||||||
23 | associated with the procurement and computed in accordance with | ||||||
24 | the tariffs filed pursuant to subsection (l) of this Section | ||||||
25 | and approved by the Commission. | ||||||
26 | (j) Within 60 days following the effective date of this |
| |||||||
| |||||||
1 | amendatory Act, each electric utility that on December 31, 2005 | ||||||
2 | provided electric service to at least 100,000 customers in | ||||||
3 | Illinois shall prepare and file with the Commission an initial | ||||||
4 | procurement plan, which shall conform in all material respects | ||||||
5 | to the requirements of the procurement plan set forth in | ||||||
6 | subsection (b); provided, however, that the Illinois Power | ||||||
7 | Agency Act shall not apply to the initial procurement plan | ||||||
8 | prepared pursuant to this subsection. The initial procurement | ||||||
9 | plan shall identify the portfolio of power and energy products | ||||||
10 | to be procured and delivered for the period June 2008 through | ||||||
11 | May 2009, and shall identify the proposed procurement | ||||||
12 | administrator, who shall have the same experience and expertise | ||||||
13 | as is required of a procurement administrator hired pursuant to | ||||||
14 | Section 1-75 of the Illinois Power Agency Act. Copies of the | ||||||
15 | procurement plan shall be posted and made publicly available on | ||||||
16 | the Commission's website. The initial procurement plan may | ||||||
17 | include contracts for renewable resources that extend beyond | ||||||
18 | May 2009. | ||||||
19 | (i) Within 14 days following filing of the initial | ||||||
20 | procurement plan, any person may file a detailed objection | ||||||
21 | with the Commission contesting the procurement plan | ||||||
22 | submitted by the electric utility. All objections to the | ||||||
23 | electric utility's plan shall be specific, supported by | ||||||
24 | data or other detailed analyses. The electric utility may | ||||||
25 | file a response to any objections to its procurement plan | ||||||
26 | within 7 days after the date objections are due to be |
| |||||||
| |||||||
1 | filed. Within 7 days after the date the utility's response | ||||||
2 | is due, the Commission shall determine whether a hearing is | ||||||
3 | necessary. If it determines that a hearing is necessary, it | ||||||
4 | shall require the hearing to be completed and issue an | ||||||
5 | order on the procurement plan within 60 days after the | ||||||
6 | filing of the procurement plan by the electric utility. | ||||||
7 | (ii) The order shall approve or modify the procurement | ||||||
8 | plan, approve an independent procurement administrator, | ||||||
9 | and approve or modify the electric utility's tariffs that | ||||||
10 | are proposed with the initial procurement plan. The | ||||||
11 | Commission shall approve the procurement plan if the | ||||||
12 | Commission determines that it will ensure adequate, | ||||||
13 | reliable, affordable, efficient, and environmentally | ||||||
14 | sustainable electric service at the lowest total cost over | ||||||
15 | time, taking into account any benefits of price stability. | ||||||
16 | (k) In order to promote price stability for residential and | ||||||
17 | small commercial customers during the transition to | ||||||
18 | competition in Illinois, and notwithstanding any other | ||||||
19 | provision of this Act, each electric utility subject to this | ||||||
20 | Section shall enter into one or more multi-year financial swap | ||||||
21 | contracts that become effective on the effective date of this | ||||||
22 | amendatory Act. These contracts may be executed with generators | ||||||
23 | and power marketers, including affiliated interests of the | ||||||
24 | electric utility. These contracts shall be for a term of no | ||||||
25 | more than 5 years and shall, for each respective utility or for | ||||||
26 | any Illinois electric utilities that are affiliated by virtue |
| |||||||
| |||||||
1 | of a common parent company and that are thereby considered a | ||||||
2 | single electric utility for purposes of this subsection (k), | ||||||
3 | not exceed in the aggregate 3,000 megawatts for any hour of the | ||||||
4 | year. The contracts shall be financial contracts and not energy | ||||||
5 | sales contracts. The contracts shall be executed as | ||||||
6 | transactions under a negotiated master agreement based on the | ||||||
7 | form of master agreement for financial swap contracts sponsored | ||||||
8 | by the International Swaps and Derivatives Association, Inc. | ||||||
9 | and shall be considered pre-existing contracts in the | ||||||
10 | utilities' procurement plans for residential and small | ||||||
11 | commercial customers. Costs incurred pursuant to a contract | ||||||
12 | authorized by this subsection (k) shall be deemed prudently | ||||||
13 | incurred and reasonable in amount and the electric utility | ||||||
14 | shall be entitled to full cost recovery pursuant to the tariffs | ||||||
15 | filed with the Commission. | ||||||
16 | (l) An electric utility shall recover its costs incurred | ||||||
17 | under this Section, including, but not limited to, the costs of | ||||||
18 | procuring power and energy demand-response resources under | ||||||
19 | this Section. The utility shall file with the initial | ||||||
20 | procurement plan its proposed tariffs through which its costs | ||||||
21 | of procuring power that are incurred pursuant to a | ||||||
22 | Commission-approved procurement plan and those other costs | ||||||
23 | identified in this subsection (l), will be recovered. The | ||||||
24 | tariffs shall include a formula rate or charge designed to pass | ||||||
25 | through both the costs incurred by the utility in procuring a | ||||||
26 | supply of electric power and energy for the applicable customer |
| |||||||
| |||||||
1 | classes with no mark-up or return on the price paid by the | ||||||
2 | utility for that supply, plus any just and reasonable costs | ||||||
3 | that the utility incurs in arranging and providing for the | ||||||
4 | supply of electric power and energy. The formula rate or charge | ||||||
5 | shall also contain provisions that ensure that its application | ||||||
6 | does not result in over or under recovery due to changes in | ||||||
7 | customer usage and demand patterns, and that provide for the | ||||||
8 | correction, on at least an annual basis, of any accounting | ||||||
9 | errors that may occur. A utility shall recover through the | ||||||
10 | tariff all reasonable costs incurred to implement or comply | ||||||
11 | with any procurement plan that is developed and put into effect | ||||||
12 | pursuant to Section 1-75 of the Illinois Power Agency Act and | ||||||
13 | this Section, including any fees assessed by the Illinois Power | ||||||
14 | Agency, costs associated with load balancing, and contingency | ||||||
15 | plan costs. The electric utility shall also recover its full | ||||||
16 | costs of procuring electric supply for which it contracted | ||||||
17 | before the effective date of this Section in conjunction with | ||||||
18 | the provision of full requirements service under fixed-price | ||||||
19 | bundled service tariffs subsequent to December 31, 2006. All | ||||||
20 | such costs shall be deemed to have been prudently incurred. The | ||||||
21 | pass-through tariffs that are filed and approved pursuant to | ||||||
22 | this Section shall not be subject to review under, or in any | ||||||
23 | way limited by, Section 16-111(i) of this Act. | ||||||
24 | (m) The Commission has the authority to adopt rules to | ||||||
25 | carry out the provisions of this Section. For the public | ||||||
26 | interest, safety, and welfare, the Commission also has |
| |||||||
| |||||||
1 | authority to adopt rules to carry out the provisions of this | ||||||
2 | Section on an emergency basis immediately following the | ||||||
3 | effective date of this amendatory Act. | ||||||
4 | (n) Notwithstanding any other provision of this Act, any | ||||||
5 | affiliated electric utilities that submit a single procurement | ||||||
6 | plan covering their combined needs may procure for those | ||||||
7 | combined needs in conjunction with that plan, and may enter | ||||||
8 | jointly into power supply contracts, purchases, and other | ||||||
9 | procurement arrangements, and allocate capacity and energy and | ||||||
10 | cost responsibility therefor among themselves in proportion to | ||||||
11 | their requirements. | ||||||
12 | (o) On or before June 1 of each year, the Commission shall | ||||||
13 | hold an informal hearing for the purpose of receiving comments | ||||||
14 | on the prior year's procurement process and any recommendations | ||||||
15 | for change.
| ||||||
16 | (p) An electric utility subject to this Section may propose | ||||||
17 | to invest, lease, own, or operate an electric generation | ||||||
18 | facility as part of its procurement plan, provided the utility | ||||||
19 | demonstrates that such facility is the least-cost option to | ||||||
20 | provide electric service to eligible retail customers. If the | ||||||
21 | facility is shown to be the least-cost option and is included | ||||||
22 | in a procurement plan prepared in accordance with Section 1-75 | ||||||
23 | of the Illinois Power Agency Act and this Section, then the | ||||||
24 | electric utility shall make a filing pursuant to Section 8-406 | ||||||
25 | of the Act, and may request of the Commission any statutory | ||||||
26 | relief required thereunder. If the Commission grants all of the |
| |||||||
| |||||||
1 | necessary approvals for the proposed facility, such supply | ||||||
2 | shall thereafter be considered as a pre-existing contract under | ||||||
3 | subsection (b) of this Section. The Commission shall in any | ||||||
4 | order approving a proposal under this subsection specify how | ||||||
5 | the utility will recover the prudently incurred costs of | ||||||
6 | investing in, leasing, owning, or operating such generation | ||||||
7 | facility through just and reasonable rates charged to eligible | ||||||
8 | retail customers. Cost recovery for facilities included in the | ||||||
9 | utility's procurement plan pursuant to this subsection shall | ||||||
10 | not be subject to review under or in any way limited by the | ||||||
11 | provisions of Section 16-111(i) of this Act. Nothing in this | ||||||
12 | Section is intended to prohibit a utility from filing for a | ||||||
13 | fuel adjustment clause as is otherwise permitted under Section | ||||||
14 | 9-220 of this Act.
| ||||||
15 | (Source: P.A. 95-481, eff. 8-28-07; 95-1027, eff. 6-1-09 .)
| ||||||
16 | Section 99. Effective date. This Act takes effect upon | ||||||
17 | becoming law.
|