Illinois General Assembly - Full Text of SB2365
Illinois General Assembly

Previous General Assemblies

Full Text of SB2365  98th General Assembly

SB2365eng 98TH GENERAL ASSEMBLY

  
  
  

 


 
SB2365 EngrossedLRB098 06614 MGM 36657 b

1    AN ACT concerning State government.
 
2    Be it enacted by the People of the State of Illinois,
3represented in the General Assembly:
 
4    Section 5. The Illinois Finance Authority Act is amended by
5changing Section 825-65 as follows:
 
6    (20 ILCS 3501/825-65)
7    Sec. 825-65. Clean Coal, Coal, Energy Efficiency, and
8Renewable Energy Project Financing.
9    (a) Findings and declaration of policy.
10        (i) It is hereby found and declared that Illinois has
11    abundant coal resources and, in some areas of Illinois, the
12    demand for power exceeds the generating capacity.
13    Incentives to encourage the construction of coal-fueled
14    electric generating plants in Illinois to ensure power
15    generating capacity into the future and to advance clean
16    coal technology and the use of Illinois coal are in the
17    best interests of all of the citizens of Illinois.
18        (ii) It is further found and declared that Illinois has
19    abundant potential and resources to develop renewable
20    energy resource projects and that there are many
21    opportunities to invest in cost-effective energy
22    efficiency projects throughout the State. The development
23    of those projects will create jobs and investment as well

 

 

SB2365 Engrossed- 2 -LRB098 06614 MGM 36657 b

1    as decrease environmental impacts and promote energy
2    independence in Illinois. Accordingly, the development of
3    those projects is in the best interests of all of the
4    citizens of Illinois.
5        (iii) The Authority is authorized to issue bonds to
6    help finance Clean Coal, Coal, Energy Efficiency, and
7    Renewable Energy projects pursuant to this Section.
8    (b) Definitions.
9        (i) "Clean Coal Project" means (A) "clean coal
10    facility", as defined in Section 1-10 of the Illinois Power
11    Agency Act; (B) "clean coal SNG facility", as defined in
12    Section 1-10 of the Illinois Power Agency Act; (C)
13    transmission lines and associated equipment that transfer
14    electricity from points of supply to points of delivery for
15    projects described in this subsection (b); (D) pipelines or
16    other methods to transfer carbon dioxide from the point of
17    production to the point of storage or sequestration for
18    projects described in this subsection (b); or (E) projects
19    to provide carbon abatement technology for existing
20    generating facilities.
21        (ii) "Coal Project" means new electric generating
22    facilities or new gasification facilities, as defined in
23    Section 605-332 of the Department of Commerce and Economic
24    Opportunity Law of the Civil Administrative Code of
25    Illinois, which may include mine-mouth power plants,
26    projects that employ the use of clean coal technology,

 

 

SB2365 Engrossed- 3 -LRB098 06614 MGM 36657 b

1    projects to provide scrubber technology for existing
2    energy generating plants, or projects to provide electric
3    transmission facilities or new gasification facilities.
4        (iii) "Energy Efficiency Project" means measures that
5    reduce the amount of electricity or natural gas required to
6    achieve a given end use, consistent with Section 1-10 of
7    the Illinois Power Agency Act. "Energy Efficiency Project"
8    also includes measures that reduce the total Btus of
9    electricity and natural gas needed to meet the end use or
10    uses consistent with Section 1-10 of the Illinois Power
11    Agency Act.
12        (iv) "Renewable Energy Project" means (A) a project
13    that uses renewable energy resources, as defined in Section
14    1-10 of the Illinois Power Agency Act; (B) a project that
15    uses environmentally preferable technologies and practices
16    that result in improvements to the production of renewable
17    fuels, including but not limited to, cellulosic
18    conversion, water and energy conservation, fractionation,
19    alternative feedstocks, or reduced green house gas
20    emissions; (C) transmission lines and associated equipment
21    that transfer electricity from points of supply to points
22    of delivery for projects described in this subsection (b);
23    or (D) projects that use technology for the storage of
24    renewable energy, including, without limitation, the use
25    of battery or electrochemical storage technology for
26    mobile or stationary applications.

 

 

SB2365 Engrossed- 4 -LRB098 06614 MGM 36657 b

1    (c) Creation of reserve funds. The Authority may establish
2and maintain one or more reserve funds to enhance bonds issued
3by the Authority for a Clean Coal Project, a Coal Project, an
4Energy Efficiency Project, or a Renewable Energy Project. There
5may be one or more accounts in these reserve funds in which
6there may be deposited:
7        (1) any proceeds of the bonds issued by the Authority
8    required to be deposited therein by the terms of any
9    contract between the Authority and its bondholders or any
10    resolution of the Authority;
11        (2) any other moneys or funds of the Authority that it
12    may determine to deposit therein from any other source; and
13        (3) any other moneys or funds made available to the
14    Authority. Subject to the terms of any pledge to the owners
15    of any bonds, moneys in any reserve fund may be held and
16    applied to the payment of principal, premium, if any, and
17    interest of such bonds.
18    (d) Powers and duties. The Authority has the power:
19        (1) To issue bonds in one or more series pursuant to
20    one or more resolutions of the Authority for any Clean Coal
21    Project, Coal Project, Energy Efficiency Project, or
22    Renewable Energy Project authorized under this Section,
23    within the authorization set forth in subsection (e).
24        (2) To provide for the funding of any reserves or other
25    funds or accounts deemed necessary by the Authority in
26    connection with any bonds issued by the Authority.

 

 

SB2365 Engrossed- 5 -LRB098 06614 MGM 36657 b

1        (3) To pledge any funds of the Authority or funds made
2    available to the Authority that may be applied to such
3    purpose as security for any bonds or any guarantees,
4    letters of credit, insurance contracts or similar credit
5    support or liquidity instruments securing the bonds.
6        (4) To enter into agreements or contracts with third
7    parties, whether public or private, including, without
8    limitation, the United States of America, the State or any
9    department or agency thereof, to obtain any
10    appropriations, grants, loans or guarantees that are
11    deemed necessary or desirable by the Authority. Any such
12    guarantee, agreement or contract may contain terms and
13    provisions necessary or desirable in connection with the
14    program, subject to the requirements established by the
15    Act.
16        (5) To exercise such other powers as are necessary or
17    incidental to the foregoing.
18    (e) Clean Coal Project, Coal Project, Energy Efficiency
19Project, and Renewable Energy Project bond authorization and
20financing limits. In addition to any other bonds authorized to
21be issued under Sections 801-40(w), 825-60, 830-25 and 845-5,
22the Authority may have outstanding, at any time, bonds for the
23purpose enumerated in this Section 825-65 in an aggregate
24principal amount that shall not exceed $3,000,000,000, subject
25to the following limitations: (i) up to $300,000,000 may be
26issued to finance projects, as described in clause (C) of

 

 

SB2365 Engrossed- 6 -LRB098 06614 MGM 36657 b

1subsection (b)(i) and clause (C) of subsection (b)(iv) of this
2Section 825-65; (ii) up to $500,000,000 may be issued to
3finance projects, as described in clauses (D) and (E) of
4subsection (b)(i) of this Section 825-65; (iii) up to
5$2,000,000,000 may be issued to finance Clean Coal Projects, as
6described in clauses (A) and (B) of subsection (b)(i) of this
7Section 825-65 and Coal Projects, as described in subsection
8(b)(ii) of this Section 825-65; and (iv) up to $2,000,000,000
9may be issued to finance Energy Efficiency Projects, as
10described in subsection (b)(iii) of this Section 825-65 and
11Renewable Energy Projects, as described in clauses (A), (B),
12and (D) of subsection (b)(iii) of this Section 825-65. An
13application for a loan financed from bond proceeds from a
14borrower or its affiliates for a Clean Coal Project, a Coal
15Project, Energy Efficiency Project, or a Renewable Energy
16Project may not be approved by the Authority for an amount in
17excess of $450,000,000 for any borrower or its affiliates.
18These bonds shall not constitute an indebtedness or obligation
19of the State of Illinois and it shall be plainly stated on the
20face of each bond that it does not constitute an indebtedness
21or obligation of the State of Illinois, but is payable solely
22from the revenues, income or other assets of the Authority
23pledged therefor.
24    (f) The bonding authority granted under this Section is in
25addition to and not limited by the provisions of Section 845-5.
26(Source: P.A. 95-470, eff. 8-27-07; 96-103, eff. 1-1-10;

 

 

SB2365 Engrossed- 7 -LRB098 06614 MGM 36657 b

196-817, eff. 1-1-10.)
 
2    Section 10. The Illinois Power Agency Act is amended by
3changing Section 1-10 as follows:
 
4    (20 ILCS 3855/1-10)
5    Sec. 1-10. Definitions.
6    "Agency" means the Illinois Power Agency.
7    "Agency loan agreement" means any agreement pursuant to
8which the Illinois Finance Authority agrees to loan the
9proceeds of revenue bonds issued with respect to a project to
10the Agency upon terms providing for loan repayment installments
11at least sufficient to pay when due all principal of, interest
12and premium, if any, on those revenue bonds, and providing for
13maintenance, insurance, and other matters in respect of the
14project.
15    "Authority" means the Illinois Finance Authority.
16    "Clean coal facility" means an electric generating
17facility that uses primarily coal as a feedstock and that
18captures and sequesters carbon dioxide emissions at the
19following levels: at least 50% of the total carbon dioxide
20emissions that the facility would otherwise emit if, at the
21time construction commences, the facility is scheduled to
22commence operation before 2016, at least 70% of the total
23carbon dioxide emissions that the facility would otherwise emit
24if, at the time construction commences, the facility is

 

 

SB2365 Engrossed- 8 -LRB098 06614 MGM 36657 b

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

 

 

SB2365 Engrossed- 9 -LRB098 06614 MGM 36657 b

1that it is necessary to use additional petroleum coke to
2deliver additional consumer savings, in which case the facility
3shall use coal for at least 35% of the total feedstock over the
4term of any sourcing agreement; and (4) captures and sequesters
5at least 85% of the total carbon dioxide emissions that the
6facility would otherwise emit.
7    "Clean coal SNG facility" means a facility that uses a
8gasification process to produce substitute natural gas, that
9sequesters at least 90% of the total carbon dioxide emissions
10that the facility would otherwise emit, that uses at least 90%
11coal as a feedstock, with all such coal having a high
12bituminous rank and greater than 1.7 pounds of sulfur per
13million btu content, and that has a valid and effective permit
14to construct emission sources and air pollution control
15equipment and approval with respect to the federal regulations
16for Prevention of Significant Deterioration of Air Quality
17(PSD) for the plant pursuant to the federal Clean Air Act;
18provided, however, a clean coal SNG brownfield facility shall
19not be a clean coal SNG facility.
20    "Commission" means the Illinois Commerce Commission.
21    "Costs incurred in connection with the development and
22construction of a facility" means:
23        (1) the cost of acquisition of all real property,
24    fixtures, and improvements in connection therewith and
25    equipment, personal property, and other property, rights,
26    and easements acquired that are deemed necessary for the

 

 

SB2365 Engrossed- 10 -LRB098 06614 MGM 36657 b

1    operation and maintenance of the facility;
2        (2) financing costs with respect to bonds, notes, and
3    other evidences of indebtedness of the Agency;
4        (3) all origination, commitment, utilization,
5    facility, placement, underwriting, syndication, credit
6    enhancement, and rating agency fees;
7        (4) engineering, design, procurement, consulting,
8    legal, accounting, title insurance, survey, appraisal,
9    escrow, trustee, collateral agency, interest rate hedging,
10    interest rate swap, capitalized interest, contingency, as
11    required by lenders, and other financing costs, and other
12    expenses for professional services; and
13        (5) the costs of plans, specifications, site study and
14    investigation, installation, surveys, other Agency costs
15    and estimates of costs, and other expenses necessary or
16    incidental to determining the feasibility of any project,
17    together with such other expenses as may be necessary or
18    incidental to the financing, insuring, acquisition, and
19    construction of a specific project and starting up,
20    commissioning, and placing that project in operation.
21    "Department" means the Department of Commerce and Economic
22Opportunity.
23    "Director" means the Director of the Illinois Power Agency.
24    "Demand-response" means measures that decrease peak
25electricity demand or shift demand from peak to off-peak
26periods.

 

 

SB2365 Engrossed- 11 -LRB098 06614 MGM 36657 b

1    "Distributed renewable energy generation device" means a
2device that is:
3        (1) powered by wind, solar thermal energy,
4    photovoltaic cells and panels, biodiesel, crops and
5    untreated and unadulterated organic waste biomass, tree
6    waste, and hydropower that does not involve new
7    construction or significant expansion of hydropower dams;
8        (2) interconnected at the distribution system level of
9    either an electric utility as defined in this Section, an
10    alternative retail electric supplier as defined in Section
11    16-102 of the Public Utilities Act, a municipal utility as
12    defined in Section 3-105 of the Public Utilities Act, or a
13    rural electric cooperative as defined in Section 3-119 of
14    the Public Utilities Act;
15        (3) located on the customer side of the customer's
16    electric meter and is primarily used to offset that
17    customer's electricity load; and
18        (4) limited in nameplate capacity to no more than 2,000
19    kilowatts.
20    "Energy efficiency" means measures that reduce the amount
21of electricity or natural gas required to achieve a given end
22use. "Energy efficiency" also includes measures that reduce the
23total Btus of electricity and natural gas needed to meet the
24end use or uses.
25    "Electric utility" has the same definition as found in
26Section 16-102 of the Public Utilities Act.

 

 

SB2365 Engrossed- 12 -LRB098 06614 MGM 36657 b

1    "Facility" means an electric generating unit or a
2co-generating unit that produces electricity along with
3related equipment necessary to connect the facility to an
4electric transmission or distribution system.
5    "Governmental aggregator" means one or more units of local
6government that individually or collectively procure
7electricity to serve residential retail electrical loads
8located within its or their jurisdiction.
9    "Local government" means a unit of local government as
10defined in Section 1 of Article VII of the Illinois
11Constitution.
12    "Municipality" means a city, village, or incorporated
13town.
14    "Person" means any natural person, firm, partnership,
15corporation, either domestic or foreign, company, association,
16limited liability company, joint stock company, or association
17and includes any trustee, receiver, assignee, or personal
18representative thereof.
19    "Project" means the planning, bidding, and construction of
20a facility.
21    "Public utility" has the same definition as found in
22Section 3-105 of the Public Utilities Act.
23    "Real property" means any interest in land together with
24all structures, fixtures, and improvements thereon, including
25lands under water and riparian rights, any easements,
26covenants, licenses, leases, rights-of-way, uses, and other

 

 

SB2365 Engrossed- 13 -LRB098 06614 MGM 36657 b

1interests, together with any liens, judgments, mortgages, or
2other claims or security interests related to real property.
3    "Renewable energy credit" means a tradable credit that
4represents the environmental attributes of a certain amount of
5energy produced from a renewable energy resource.
6    "Renewable energy resources" includes energy and its
7associated renewable energy credit or renewable energy credits
8from wind, solar thermal energy, photovoltaic cells and panels,
9biodiesel, anaerobic digestion, crops and untreated and
10unadulterated organic waste biomass, tree waste, hydropower
11that does not involve new construction or significant expansion
12of hydropower dams, and other alternative sources of
13environmentally preferable energy. For purposes of this Act,
14landfill gas produced in the State is considered a renewable
15energy resource. "Renewable energy resources" does not include
16the incineration or burning of tires, garbage, general
17household, institutional, and commercial waste, industrial
18lunchroom or office waste, landscape waste other than tree
19waste, railroad crossties, utility poles, or construction or
20demolition debris, other than untreated and unadulterated
21waste wood.
22    "Revenue bond" means any bond, note, or other evidence of
23indebtedness issued by the Authority, the principal and
24interest of which is payable solely from revenues or income
25derived from any project or activity of the Agency.
26    "Sequester" means permanent storage of carbon dioxide by

 

 

SB2365 Engrossed- 14 -LRB098 06614 MGM 36657 b

1injecting it into a saline aquifer, a depleted gas reservoir,
2or an oil reservoir, directly or through an enhanced oil
3recovery process that may involve intermediate storage,
4regardless of whether these activities are conducted by a clean
5coal facility, a clean coal SNG facility, a clean coal SNG
6brownfield facility, or a party with which a clean coal
7facility, clean coal SNG facility, or clean coal SNG brownfield
8facility has contracted for such purposes.
9    "Sourcing agreement" means (i) in the case of an electric
10utility, an agreement between the owner of a clean coal
11facility and such electric utility, which agreement shall have
12terms and conditions meeting the requirements of paragraph (3)
13of subsection (d) of Section 1-75, (ii) in the case of an
14alternative retail electric supplier, an agreement between the
15owner of a clean coal facility and such alternative retail
16electric supplier, which agreement shall have terms and
17conditions meeting the requirements of Section 16-115(d)(5) of
18the Public Utilities Act, and (iii) in case of a gas utility,
19an agreement between the owner of a clean coal SNG brownfield
20facility and the gas utility, which agreement shall have the
21terms and conditions meeting the requirements of subsection
22(h-1) of Section 9-220 of the Public Utilities Act.
23    "Substitute natural gas" or "SNG" means a gas manufactured
24by gasification of hydrocarbon feedstock, which is
25substantially interchangeable in use and distribution with
26conventional natural gas.

 

 

SB2365 Engrossed- 15 -LRB098 06614 MGM 36657 b

1    "Total resource cost test" or "TRC test" means a standard
2that is met if, for an investment in energy efficiency or
3demand-response measures, the benefit-cost ratio is greater
4than one. The benefit-cost ratio is the ratio of the net
5present value of the total benefits of the program to the net
6present value of the total costs as calculated over the
7lifetime of the measures. A total resource cost test compares
8the sum of avoided electric utility costs, representing the
9benefits that accrue to the system and the participant in the
10delivery of those efficiency measures, as well as other
11quantifiable societal benefits, including avoided natural gas
12utility costs, to the sum of all incremental costs of end-use
13measures that are implemented due to the program (including
14both utility and participant contributions), plus costs to
15administer, deliver, and evaluate each demand-side program, to
16quantify the net savings obtained by substituting the
17demand-side program for supply resources. In calculating
18avoided costs of power and energy that an electric utility
19would otherwise have had to acquire, reasonable estimates shall
20be included of financial costs likely to be imposed by future
21regulations and legislation on emissions of greenhouse gases.
22(Source: P.A. 96-33, eff. 7-10-09; 96-159, eff. 8-10-09;
2396-784, eff. 8-28-09; 96-1000, eff. 7-2-10; 97-96, eff.
247-13-11; 97-239, eff. 8-2-11; 97-491, eff. 8-22-11; 97-616,
25eff. 10-26-11; 97-813, eff. 7-13-12.)
 

 

 

SB2365 Engrossed- 16 -LRB098 06614 MGM 36657 b

1    Section 15. The Public Utilities Act is amended by changing
2Sections 8-103 and 8-104 as follows:
 
3    (220 ILCS 5/8-103)
4    Sec. 8-103. Energy efficiency and demand-response
5measures.
6    (a) It is the policy of the State that electric utilities
7are required to use cost-effective energy efficiency and
8demand-response measures to reduce delivery load. Requiring
9investment in cost-effective energy efficiency and
10demand-response measures will reduce direct and indirect costs
11to consumers by decreasing environmental impacts and by
12avoiding or delaying the need for new generation, transmission,
13and distribution infrastructure. It serves the public interest
14to allow electric utilities to recover costs for reasonably and
15prudently incurred expenses for energy efficiency and
16demand-response measures. As used in this Section,
17"cost-effective" means that the measures satisfy the total
18resource cost test. The low-income measures described in
19subsection (f)(4) of this Section shall not be required to meet
20the total resource cost test. For purposes of this Section, the
21terms "energy-efficiency", "demand-response", "electric
22utility", and "total resource cost test" shall have the
23meanings set forth in the Illinois Power Agency Act. For
24purposes of this Section, the amount per kilowatthour means the
25total amount paid for electric service expressed on a per

 

 

SB2365 Engrossed- 17 -LRB098 06614 MGM 36657 b

1kilowatthour basis. For purposes of this Section, the total
2amount paid for electric service includes without limitation
3estimated amounts paid for supply, transmission, distribution,
4surcharges, and add-on-taxes.
5    (b) Electric utilities shall implement cost-effective
6energy efficiency measures to meet the following incremental
7annual energy savings goals:
8        (1) 0.2% of energy delivered in the year commencing
9    June 1, 2008;
10        (2) 0.4% of energy delivered in the year commencing
11    June 1, 2009;
12        (3) 0.6% of energy delivered in the year commencing
13    June 1, 2010;
14        (4) 0.8% of energy delivered in the year commencing
15    June 1, 2011;
16        (5) 1% of energy delivered in the year commencing June
17    1, 2012;
18        (6) 1.4% of energy delivered in the year commencing
19    June 1, 2013;
20        (7) 1.8% of energy delivered in the year commencing
21    June 1, 2014; and
22        (8) 2% of energy delivered in the year commencing June
23    1, 2015 and each year thereafter.
24    Electric utilities may comply with this subsection (b) by
25meeting the annual incremental savings goal in the applicable
26year or by showing that total savings associated with measures

 

 

SB2365 Engrossed- 18 -LRB098 06614 MGM 36657 b

1implemented on or after May 31, 2014 were equal to the sum of
2each annual incremental savings goal on or after June 1, 2014
3through the end of the applicable year.
4    (c) Electric utilities shall implement cost-effective
5demand-response measures to reduce peak demand by 0.1% over the
6prior year for eligible retail customers, as defined in Section
716-111.5 of this Act, and for customers that elect hourly
8service from the utility pursuant to Section 16-107 of this
9Act, provided those customers have not been declared
10competitive. This requirement commences June 1, 2008 and
11continues for 10 years.
12    (d) Notwithstanding the requirements of subsections (b)
13and (c) of this Section, an electric utility shall reduce the
14amount of energy efficiency and demand-response measures
15implemented over in any 3-year period single year by an amount
16necessary to limit the estimated average annual increase in the
17amounts paid by retail customers in connection with electric
18service due to the cost of those measures to:
19        (1) in 2008, no more than 0.5% of the amount paid per
20    kilowatthour by those customers during the year ending May
21    31, 2007;
22        (2) in 2009, the greater of an additional 0.5% of the
23    amount paid per kilowatthour by those customers during the
24    year ending May 31, 2008 or 1% of the amount paid per
25    kilowatthour by those customers during the year ending May
26    31, 2007;

 

 

SB2365 Engrossed- 19 -LRB098 06614 MGM 36657 b

1        (3) in 2010, the greater of an additional 0.5% of the
2    amount paid per kilowatthour by those customers during the
3    year ending May 31, 2009 or 1.5% of the amount paid per
4    kilowatthour by those customers during the year ending May
5    31, 2007;
6        (4) in 2011, the greater of an additional 0.5% of the
7    amount paid per kilowatthour by those customers during the
8    year ending May 31, 2010 or 2% of the amount paid per
9    kilowatthour by those customers during the year ending May
10    31, 2007; and
11        (5) thereafter, the amount of energy efficiency and
12    demand-response measures implemented for any single year
13    shall be reduced by an amount necessary to limit the
14    estimated average net increase due to the cost of these
15    measures included in the amounts paid by eligible retail
16    customers in connection with electric service to no more
17    than the greater of 2.015% of the amount paid per
18    kilowatthour by those customers during the year ending May
19    31, 2007 or the incremental amount per kilowatthour paid
20    for these measures in 2011.
21    No later than June 30, 2011, the Commission shall review
22the limitation on the amount of energy efficiency and
23demand-response measures implemented pursuant to this Section
24and report to the General Assembly its findings as to whether
25that limitation unduly constrains the procurement of energy
26efficiency and demand-response measures.

 

 

SB2365 Engrossed- 20 -LRB098 06614 MGM 36657 b

1    (e) Electric utilities shall be responsible for overseeing
2the design, development, and filing of energy efficiency and
3demand-response plans with the Commission. Electric utilities
4shall implement 100% of the demand-response measures in the
5plans. Electric utilities shall implement 75% of the energy
6efficiency measures approved by the Commission, and may, as
7part of that implementation, outsource various aspects of
8program development and implementation. The remaining 25% of
9those energy efficiency measures approved by the Commission
10shall be implemented by the Department of Commerce and Economic
11Opportunity, and must be designed in conjunction with the
12utility and the filing process. The Department may outsource
13development and implementation of energy efficiency measures.
14A minimum of 10% of the entire portfolio of cost-effective
15energy efficiency measures shall be procured from units of
16local government, municipal corporations, school districts,
17and community college districts. The Department shall
18coordinate the implementation of these measures.
19    The apportionment of the dollars to cover the costs to
20implement the Department's share of the portfolio of energy
21efficiency measures shall be made to the Department once the
22Department has executed rebate agreements, grants, or
23contracts for energy efficiency measures and provided
24supporting documentation for those rebate agreements, grants,
25and contracts to the utility. The Department is authorized to
26adopt any rules necessary and prescribe procedures in order to

 

 

SB2365 Engrossed- 21 -LRB098 06614 MGM 36657 b

1ensure compliance by applicants in carrying out the purposes of
2rebate agreements for energy efficiency measures implemented
3by the Department made under this Section.
4    The details of the measures implemented by the Department
5shall be submitted by the Department to the Commission in
6connection with the utility's filing regarding the energy
7efficiency and demand-response measures that the utility
8implements.
9    A utility providing approved energy efficiency and
10demand-response measures in the State shall be permitted to
11recover costs of those measures through an automatic adjustment
12clause tariff filed with and approved by the Commission. The
13tariff shall be established outside the context of a general
14rate case. Each year the Commission shall initiate a review to
15reconcile any amounts collected with the actual costs and to
16determine the required adjustment to the annual tariff factor
17to match annual expenditures.
18    Each utility shall include, in its recovery of costs, the
19costs estimated for both the utility's and the Department's
20implementation of energy efficiency and demand-response
21measures. Costs collected by the utility for measures
22implemented by the Department shall be submitted to the
23Department pursuant to Section 605-323 of the Civil
24Administrative Code of Illinois, shall be deposited into the
25Energy Efficiency Portfolio Standards Fund, and shall be used
26by the Department solely for the purpose of implementing these

 

 

SB2365 Engrossed- 22 -LRB098 06614 MGM 36657 b

1measures. A utility shall not be required to advance any moneys
2to the Department but only to forward such funds as it has
3collected. The Department shall report to the Commission on an
4annual basis regarding the costs actually incurred by the
5Department in the implementation of the measures. Any changes
6to the costs of energy efficiency measures as a result of plan
7modifications shall be appropriately reflected in amounts
8recovered by the utility and turned over to the Department.
9    The portfolio of measures, administered by both the
10utilities and the Department, shall, in combination, be
11designed to achieve the annual savings targets described in
12subsections (b) and (c) of this Section, as modified by
13subsection (d) of this Section.
14    The utility and the Department shall agree upon a
15reasonable portfolio of measures and determine the measurable
16corresponding percentage of the savings goals associated with
17measures implemented by the utility or Department.
18    No utility shall be assessed a penalty under subsection (f)
19of this Section for failure to make a timely filing if that
20failure is the result of a lack of agreement with the
21Department with respect to the allocation of responsibilities
22or related costs or target assignments. In that case, the
23Department and the utility shall file their respective plans
24with the Commission and the Commission shall determine an
25appropriate division of measures and programs that meets the
26requirements of this Section.

 

 

SB2365 Engrossed- 23 -LRB098 06614 MGM 36657 b

1    If the Department is unable to meet incremental annual
2performance goals for the portion of the portfolio implemented
3by the Department, then the utility and the Department shall
4jointly submit a modified filing to the Commission explaining
5the performance shortfall and recommending an appropriate
6course going forward, including any program modifications that
7may be appropriate in light of the evaluations conducted under
8item (7) of subsection (f) of this Section. In this case, the
9utility obligation to collect the Department's costs and turn
10over those funds to the Department under this subsection (e)
11shall continue only if the Commission approves the
12modifications to the plan proposed by the Department.
13    (f) No later than November 15, 2007, each electric utility
14shall file an energy efficiency and demand-response plan with
15the Commission to meet the energy efficiency and
16demand-response standards for 2008 through 2010. No later than
17October 1, 2010, each electric utility shall file an energy
18efficiency and demand-response plan with the Commission to meet
19the energy efficiency and demand-response standards for 2011
20through 2013. Every 3 years thereafter, each electric utility
21shall file, no later than September 1, an energy efficiency and
22demand-response plan with the Commission. If a utility does not
23file such a plan by September 1 of an applicable year, it shall
24face a penalty of $100,000 per day until the plan is filed.
25Each utility's plan shall set forth the utility's proposals to
26meet the utility's portion of the energy efficiency standards

 

 

SB2365 Engrossed- 24 -LRB098 06614 MGM 36657 b

1identified in subsection (b) and the demand-response standards
2identified in subsection (c) of this Section as modified by
3subsections (d) and (e), taking into account the unique
4circumstances of the utility's service territory. The
5Commission shall seek public comment on the utility's plan and
6shall issue an order approving or disapproving each plan within
75 months after its submission. If the Commission disapproves a
8plan, the Commission shall, within 30 days, describe in detail
9the reasons for the disapproval and describe a path by which
10the utility may file a revised draft of the plan to address the
11Commission's concerns satisfactorily. If the utility does not
12refile with the Commission within 60 days, the utility shall be
13subject to penalties at a rate of $100,000 per day until the
14plan is filed. This process shall continue, and penalties shall
15accrue, until the utility has successfully filed a portfolio of
16energy efficiency and demand-response measures. Penalties
17shall be deposited into the Energy Efficiency Trust Fund. In
18submitting proposed energy efficiency and demand-response
19plans and funding levels to meet the savings goals adopted by
20this Act the utility shall:
21        (1) Demonstrate that its proposed energy efficiency
22    and demand-response measures will achieve the requirements
23    that are identified in subsections (b) and (c) of this
24    Section, as modified by subsections (d) and (e).
25        (2) Present specific proposals to implement new
26    building and appliance standards that have been placed into

 

 

SB2365 Engrossed- 25 -LRB098 06614 MGM 36657 b

1    effect.
2        (3) Present estimates of the total amount paid for
3    electric service expressed on a per kilowatthour basis
4    associated with the proposed portfolio of measures
5    designed to meet the requirements that are identified in
6    subsections (b) and (c) of this Section, as modified by
7    subsections (d) and (e).
8        (4) Coordinate with the Department to present a
9    portfolio of energy efficiency measures proportionate to
10    the share of total annual utility revenues in Illinois from
11    households at or below 150% of the poverty level. The
12    energy efficiency programs shall be targeted to households
13    with incomes at or below 80% of area median income.
14        (5) Demonstrate that its overall portfolio of energy
15    efficiency and demand-response measures, not including
16    programs covered by item (4) of this subsection (f), are
17    cost-effective using the total resource cost test and
18    represent a diverse cross-section of opportunities for
19    customers of all rate classes to participate in the
20    programs.
21        (6) Include a proposed cost-recovery tariff mechanism
22    to fund the proposed energy efficiency and demand-response
23    measures and to ensure the recovery of the prudently and
24    reasonably incurred costs of Commission-approved programs.
25        (7) Provide for an annual independent evaluation of the
26    performance of the cost-effectiveness of the utility's

 

 

SB2365 Engrossed- 26 -LRB098 06614 MGM 36657 b

1    portfolio of measures and the Department's portfolio of
2    measures, as well as a full review of the 3-year results of
3    the broader net program impacts and, to the extent
4    practical, for adjustment of the measures on a
5    going-forward basis as a result of the evaluations. The
6    resources dedicated to evaluation shall not exceed 3% of
7    portfolio resources in any given year.
8    (g) No more than 3% of energy efficiency and
9demand-response program revenue may be allocated for
10demonstration of breakthrough equipment and devices.
11    (h) This Section does not apply to an electric utility that
12on December 31, 2005 provided electric service to fewer than
13100,000 customers in Illinois.
14    (i) If, after 2 years, an electric utility fails to meet
15the efficiency standard specified in subsection (b) of this
16Section, as modified by subsections (d) and (e), it shall make
17a contribution to the Low-Income Home Energy Assistance
18Program. The combined total liability for failure to meet the
19goal shall be $1,000,000, which shall be assessed as follows: a
20large electric utility shall pay $665,000, and a medium
21electric utility shall pay $335,000. If, after 3 years, an
22electric utility fails to meet the efficiency standard
23specified in subsection (b) of this Section, as modified by
24subsections (d) and (e), it shall make a contribution to the
25Low-Income Home Energy Assistance Program. The combined total
26liability for failure to meet the goal shall be $1,000,000,

 

 

SB2365 Engrossed- 27 -LRB098 06614 MGM 36657 b

1which shall be assessed as follows: a large electric utility
2shall pay $665,000, and a medium electric utility shall pay
3$335,000. In addition, the responsibility for implementing the
4energy efficiency measures of the utility making the payment
5shall be transferred to the Illinois Power Agency if, after 3
6years, or in any subsequent 3-year period, the utility fails to
7meet the efficiency standard specified in subsection (b) of
8this Section, as modified by subsections (d) and (e). The
9Agency shall implement a competitive procurement program to
10procure resources necessary to meet the standards specified in
11this Section as modified by subsections (d) and (e), with costs
12for those resources to be recovered in the same manner as
13products purchased through the procurement plan as provided in
14Section 16-111.5. The Director shall implement this
15requirement in connection with the procurement plan as provided
16in Section 16-111.5.
17    For purposes of this Section, (i) a "large electric
18utility" is an electric utility that, on December 31, 2005,
19served more than 2,000,000 electric customers in Illinois; (ii)
20a "medium electric utility" is an electric utility that, on
21December 31, 2005, served 2,000,000 or fewer but more than
22100,000 electric customers in Illinois; and (iii) Illinois
23electric utilities that are affiliated by virtue of a common
24parent company are considered a single electric utility.
25    (j) If, after 3 years, or any subsequent 3-year period, the
26Department fails to implement the Department's share of energy

 

 

SB2365 Engrossed- 28 -LRB098 06614 MGM 36657 b

1efficiency measures required by the standards in subsection
2(b), then the Illinois Power Agency may assume responsibility
3for and control of the Department's share of the required
4energy efficiency measures. The Agency shall implement a
5competitive procurement program to procure resources necessary
6to meet the standards specified in this Section, with the costs
7of these resources to be recovered in the same manner as
8provided for the Department in this Section.
9    (k) No electric utility shall be deemed to have failed to
10meet the energy efficiency standards to the extent any such
11failure is due to a failure of the Department or the Agency.
12(Source: P.A. 96-33, eff. 7-10-09; 96-159, eff. 8-10-09;
1396-1000, eff. 7-2-10; 97-616, eff. 10-26-11; 97-841, eff.
147-20-12.)
 
15    (220 ILCS 5/8-104)
16    Sec. 8-104. Natural gas energy efficiency programs.
17    (a) It is the policy of the State that natural gas
18utilities and the Department of Commerce and Economic
19Opportunity are required to use cost-effective energy
20efficiency to reduce direct and indirect costs to consumers. It
21serves the public interest to allow natural gas utilities to
22recover costs for reasonably and prudently incurred expenses
23for cost-effective energy efficiency measures.
24    (b) For purposes of this Section, "energy efficiency" means
25measures that reduce the amount of energy required to achieve a

 

 

SB2365 Engrossed- 29 -LRB098 06614 MGM 36657 b

1given end use. "Energy efficiency" also includes measures that
2reduce the total Btus of electricity and natural gas needed to
3meet the end use or uses. "Cost-effective" and "cost-effective"
4means that the measures satisfy the total resource cost test
5which, for purposes of this Section, means a standard that is
6met if, for an investment in energy efficiency, the
7benefit-cost ratio is greater than one. The benefit-cost ratio
8is the ratio of the net present value of the total benefits of
9the measures to the net present value of the total costs as
10calculated over the lifetime of the measures. The total
11resource cost test compares the sum of avoided natural gas
12utility costs, representing the benefits that accrue to the
13system and the participant in the delivery of those efficiency
14measures, as well as other quantifiable societal benefits,
15including avoided electric utility costs, to the sum of all
16incremental costs of end use measures (including both utility
17and participant contributions), plus costs to administer,
18deliver, and evaluate each demand-side measure, to quantify the
19net savings obtained by substituting demand-side measures for
20supply resources. In calculating avoided costs, reasonable
21estimates shall be included for financial costs likely to be
22imposed by future regulation of emissions of greenhouse gases.
23The low-income programs described in item (4) of subsection (f)
24of this Section shall not be required to meet the total
25resource cost test.
26    (c) Natural gas utilities shall implement cost-effective

 

 

SB2365 Engrossed- 30 -LRB098 06614 MGM 36657 b

1energy efficiency measures to meet at least the following
2natural gas savings requirements, which shall be based upon the
3total amount of gas delivered to retail customers, other than
4the customers described in subsection (m) of this Section,
5during calendar year 2009 multiplied by the applicable
6percentage. Natural gas utilities may comply with this Section
7by meeting the annual incremental savings goal in the
8applicable year or by showing that total savings associated
9with measures implemented after May 31, 2011 were equal to the
10sum of each annual incremental savings requirement from May 31,
112011 through the end of the applicable year:
12        (1) 0.2% by May 31, 2012;
13        (2) an additional 0.4% by May 31, 2013, increasing
14    total savings to .6%;
15        (3) an additional 0.6% by May 31, 2014, increasing
16    total savings to 1.2%;
17        (4) an additional 0.8% by May 31, 2015, increasing
18    total savings to 2.0%;
19        (5) an additional 1% by May 31, 2016, increasing total
20    savings to 3.0%;
21        (6) an additional 1.2% by May 31, 2017, increasing
22    total savings to 4.2%;
23        (7) an additional 1.4% by May 31, 2018, increasing
24    total savings to 5.6%;
25        (8) an additional 1.5% by May 31, 2019, increasing
26    total savings to 7.1%; and

 

 

SB2365 Engrossed- 31 -LRB098 06614 MGM 36657 b

1        (9) an additional 1.5% in each 12-month period
2    thereafter.
3    (d) Notwithstanding the requirements of subsection (c) of
4this Section, a natural gas utility shall limit the amount of
5energy efficiency implemented in any 3-year reporting period
6established by subsection (f) of Section 8-104 of this Act, by
7an amount necessary to limit the estimated average increase in
8the amounts paid by retail customers in connection with natural
9gas service to no more than 2% in the applicable 3-year
10reporting period. The energy savings requirements in
11subsection (c) of this Section may be reduced by the Commission
12for the subject plan, if the utility demonstrates by
13substantial evidence that it is highly unlikely that the
14requirements could be achieved without exceeding the
15applicable spending limits in any 3-year reporting period. No
16later than September 1, 2013, the Commission shall review the
17limitation on the amount of energy efficiency measures
18implemented pursuant to this Section and report to the General
19Assembly, in the report required by subsection (k) of this
20Section, its findings as to whether that limitation unduly
21constrains the procurement of energy efficiency measures.
22    (e) Natural gas utilities shall be responsible for
23overseeing the design, development, and filing of their
24efficiency plans with the Commission. The utility shall utilize
2575% of the available funding associated with energy efficiency
26programs approved by the Commission, and may outsource various

 

 

SB2365 Engrossed- 32 -LRB098 06614 MGM 36657 b

1aspects of program development and implementation. The
2remaining 25% of available funding shall be used by the
3Department of Commerce and Economic Opportunity to implement
4energy efficiency measures that achieve no less than 20% of the
5requirements of subsection (c) of this Section. Such measures
6shall be designed in conjunction with the utility and approved
7by the Commission. The Department may outsource development and
8implementation of energy efficiency measures. A minimum of 10%
9of the entire portfolio of cost-effective energy efficiency
10measures shall be procured from local government, municipal
11corporations, school districts, and community college
12districts. Five percent of the entire portfolio of
13cost-effective energy efficiency measures may be granted to
14local government and municipal corporations for market
15transformation initiatives. The Department shall coordinate
16the implementation of these measures and shall integrate
17delivery of natural gas efficiency programs with electric
18efficiency programs delivered pursuant to Section 8-103 of this
19Act, unless the Department can show that integration is not
20feasible.
21    The apportionment of the dollars to cover the costs to
22implement the Department's share of the portfolio of energy
23efficiency measures shall be made to the Department once the
24Department has executed rebate agreements, grants, or
25contracts for energy efficiency measures and provided
26supporting documentation for those rebate agreements, grants,

 

 

SB2365 Engrossed- 33 -LRB098 06614 MGM 36657 b

1and contracts to the utility. The Department is authorized to
2adopt any rules necessary and prescribe procedures in order to
3ensure compliance by applicants in carrying out the purposes of
4rebate agreements for energy efficiency measures implemented
5by the Department made under this Section.
6    The details of the measures implemented by the Department
7shall be submitted by the Department to the Commission in
8connection with the utility's filing regarding the energy
9efficiency measures that the utility implements.
10    A utility providing approved energy efficiency measures in
11this State shall be permitted to recover costs of those
12measures through an automatic adjustment clause tariff filed
13with and approved by the Commission. The tariff shall be
14established outside the context of a general rate case and
15shall be applicable to the utility's customers other than the
16customers described in subsection (m) of this Section. Each
17year the Commission shall initiate a review to reconcile any
18amounts collected with the actual costs and to determine the
19required adjustment to the annual tariff factor to match annual
20expenditures.
21    Each utility shall include, in its recovery of costs, the
22costs estimated for both the utility's and the Department's
23implementation of energy efficiency measures. Costs collected
24by the utility for measures implemented by the Department shall
25be submitted to the Department pursuant to Section 605-323 of
26the Civil Administrative Code of Illinois, shall be deposited

 

 

SB2365 Engrossed- 34 -LRB098 06614 MGM 36657 b

1into the Energy Efficiency Portfolio Standards Fund, and shall
2be used by the Department solely for the purpose of
3implementing these measures. A utility shall not be required to
4advance any moneys to the Department but only to forward such
5funds as it has collected. The Department shall report to the
6Commission on an annual basis regarding the costs actually
7incurred by the Department in the implementation of the
8measures. Any changes to the costs of energy efficiency
9measures as a result of plan modifications shall be
10appropriately reflected in amounts recovered by the utility and
11turned over to the Department.
12    The portfolio of measures, administered by both the
13utilities and the Department, shall, in combination, be
14designed to achieve the annual energy savings requirements set
15forth in subsection (c) of this Section, as modified by
16subsection (d) of this Section.
17    The utility and the Department shall agree upon a
18reasonable portfolio of measures and determine the measurable
19corresponding percentage of the savings goals associated with
20measures implemented by the Department.
21    No utility shall be assessed a penalty under subsection (f)
22of this Section for failure to make a timely filing if that
23failure is the result of a lack of agreement with the
24Department with respect to the allocation of responsibilities
25or related costs or target assignments. In that case, the
26Department and the utility shall file their respective plans

 

 

SB2365 Engrossed- 35 -LRB098 06614 MGM 36657 b

1with the Commission and the Commission shall determine an
2appropriate division of measures and programs that meets the
3requirements of this Section.
4    If the Department is unable to meet performance
5requirements for the portion of the portfolio implemented by
6the Department, then the utility and the Department shall
7jointly submit a modified filing to the Commission explaining
8the performance shortfall and recommending an appropriate
9course going forward, including any program modifications that
10may be appropriate in light of the evaluations conducted under
11item (8) of subsection (f) of this Section. In this case, the
12utility obligation to collect the Department's costs and turn
13over those funds to the Department under this subsection (e)
14shall continue only if the Commission approves the
15modifications to the plan proposed by the Department.
16    (f) No later than October 1, 2010, each gas utility shall
17file an energy efficiency plan with the Commission to meet the
18energy efficiency standards through May 31, 2014. Every 3 years
19thereafter, each utility shall file, no later than October 1,
20an energy efficiency plan with the Commission. If a utility
21does not file such a plan by October 1 of the applicable year,
22then it shall face a penalty of $100,000 per day until the plan
23is filed. Each utility's plan shall set forth the utility's
24proposals to meet the utility's portion of the energy
25efficiency standards identified in subsection (c) of this
26Section, as modified by subsection (d) of this Section, taking

 

 

SB2365 Engrossed- 36 -LRB098 06614 MGM 36657 b

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

 

 

SB2365 Engrossed- 37 -LRB098 06614 MGM 36657 b

1    service expressed on a per therm basis associated with the
2    proposed portfolio of measures designed to meet the
3    requirements that are identified in subsection (c) of this
4    Section, as modified by subsection (d) of this Section.
5        (4) Coordinate with the Department to present a
6    portfolio of energy efficiency measures proportionate to
7    the share of total annual utility revenues in Illinois from
8    households at or below 150% of the poverty level. Such
9    programs shall be targeted to households with incomes at or
10    below 80% of area median income.
11        (5) Demonstrate that its overall portfolio of energy
12    efficiency measures, not including programs covered by
13    item (4) of this subsection (f), are cost-effective using
14    the total resource cost test and represent a diverse cross
15    section of opportunities for customers of all rate classes
16    to participate in the programs.
17        (6) Demonstrate that a gas utility affiliated with an
18    electric utility that is required to comply with Section
19    8-103 of this Act has integrated gas and electric
20    efficiency measures into a single program that reduces
21    program or participant costs and appropriately allocates
22    costs to gas and electric ratepayers. The Department shall
23    integrate all gas and electric programs it delivers in any
24    such utilities' service territories, unless the Department
25    can show that integration is not feasible or appropriate.
26        (7) Include a proposed cost recovery tariff mechanism

 

 

SB2365 Engrossed- 38 -LRB098 06614 MGM 36657 b

1    to fund the proposed energy efficiency measures and to
2    ensure the recovery of the prudently and reasonably
3    incurred costs of Commission-approved programs.
4        (8) Provide for quarterly status reports tracking
5    implementation of and expenditures for the utility's
6    portfolio of measures and the Department's portfolio of
7    measures, an annual independent review, and a full
8    independent evaluation of the 3-year results of the
9    performance and the cost-effectiveness of the utility's
10    and Department's portfolios of measures and broader net
11    program impacts and, to the extent practical, for
12    adjustment of the measures on a going forward basis as a
13    result of the evaluations. The resources dedicated to
14    evaluation shall not exceed 3% of portfolio resources in
15    any given 3-year period.
16    (g) No more than 3% of expenditures on energy efficiency
17measures may be allocated for demonstration of breakthrough
18equipment and devices.
19    (h) Illinois natural gas utilities that are affiliated by
20virtue of a common parent company may, at the utilities'
21request, be considered a single natural gas utility for
22purposes of complying with this Section.
23    (i) If, after 3 years, a gas utility fails to meet the
24efficiency standard specified in subsection (c) of this Section
25as modified by subsection (d), then it shall make a
26contribution to the Low-Income Home Energy Assistance Program.

 

 

SB2365 Engrossed- 39 -LRB098 06614 MGM 36657 b

1The total liability for failure to meet the goal shall be
2assessed as follows:
3        (1) a large gas utility shall pay $600,000;
4        (2) a medium gas utility shall pay $400,000; and
5        (3) a small gas utility shall pay $200,000.
6    For purposes of this Section, (i) a "large gas utility" is
7a gas utility that on December 31, 2008, served more than
81,500,000 gas customers in Illinois; (ii) a "medium gas
9utility" is a gas utility that on December 31, 2008, served
10fewer than 1,500,000, but more than 500,000 gas customers in
11Illinois; and (iii) a "small gas utility" is a gas utility that
12on December 31, 2008, served fewer than 500,000 and more than
13100,000 gas customers in Illinois. The costs of this
14contribution may not be recovered from ratepayers.
15    If a gas utility fails to meet the efficiency standard
16specified in subsection (c) of this Section, as modified by
17subsection (d) of this Section, in any 2 consecutive 3-year
18planning periods, then the responsibility for implementing the
19utility's energy efficiency measures shall be transferred to an
20independent program administrator selected by the Commission.
21Reasonable and prudent costs incurred by the independent
22program administrator to meet the efficiency standard
23specified in subsection (c) of this Section, as modified by
24subsection (d) of this Section, may be recovered from the
25customers of the affected gas utilities, other than customers
26described in subsection (m) of this Section. The utility shall

 

 

SB2365 Engrossed- 40 -LRB098 06614 MGM 36657 b

1provide the independent program administrator with all
2information and assistance necessary to perform the program
3administrator's duties including but not limited to customer,
4account, and energy usage data, and shall allow the program
5administrator to include inserts in customer bills. The utility
6may recover reasonable costs associated with any such
7assistance.
8    (j) No utility shall be deemed to have failed to meet the
9energy efficiency standards to the extent any such failure is
10due to a failure of the Department.
11    (k) Not later than January 1, 2012, the Commission shall
12develop and solicit public comment on a plan to foster
13statewide coordination and consistency between statutorily
14mandated natural gas and electric energy efficiency programs to
15reduce program or participant costs or to improve program
16performance. Not later than September 1, 2013, the Commission
17shall issue a report to the General Assembly containing its
18findings and recommendations.
19    (l) This Section does not apply to a gas utility that on
20January 1, 2009, provided gas service to fewer than 100,000
21customers in Illinois.
22    (m) Subsections (a) through (k) of this Section do not
23apply to customers of a natural gas utility that have a North
24American Industry Classification System code number that is
2522111 or any such code number beginning with the digits 31, 32,
26or 33 and (i) annual usage in the aggregate of 4 million therms

 

 

SB2365 Engrossed- 41 -LRB098 06614 MGM 36657 b

1or more within the service territory of the affected gas
2utility or with aggregate usage of 8 million therms or more in
3this State and complying with the provisions of item (l) of
4this subsection (m); or (ii) using natural gas as feedstock and
5meeting the usage requirements described in item (i) of this
6subsection (m), to the extent such annual feedstock usage is
7greater than 60% of the customer's total annual usage of
8natural gas.
9        (1) Customers described in this subsection (m) of this
10    Section shall apply, on a form approved on or before
11    October 1, 2009 by the Department, to the Department to be
12    designated as a self-directing customer ("SDC") or as an
13    exempt customer using natural gas as a feedstock from which
14    other products are made, including, but not limited to,
15    feedstock for a hydrogen plant, on or before the 1st day of
16    February, 2010. Thereafter, application may be made not
17    less than 6 months before the filing date of the gas
18    utility energy efficiency plan described in subsection (f)
19    of this Section; however, a new customer that commences
20    taking service from a natural gas utility after February 1,
21    2010 may apply to become a SDC or exempt customer up to 30
22    days after beginning service. Such application shall
23    contain the following:
24            (A) the customer's certification that, at the time
25        of its application, it qualifies to be a SDC or exempt
26        customer described in this subsection (m) of this

 

 

SB2365 Engrossed- 42 -LRB098 06614 MGM 36657 b

1        Section;
2            (B) in the case of a SDC, the customer's
3        certification that it has established or will
4        establish by the beginning of the utility's 3-year
5        planning period commencing subsequent to the
6        application, and will maintain for accounting
7        purposes, an energy efficiency reserve account and
8        that the customer will accrue funds in said account to
9        be held for the purpose of funding, in whole or in
10        part, energy efficiency measures of the customer's
11        choosing, which may include, but are not limited to,
12        projects involving combined heat and power systems
13        that use the same energy source both for the generation
14        of electrical or mechanical power and the production of
15        steam or another form of useful thermal energy or the
16        use of combustible gas produced from biomass, or both;
17            (C) in the case of a SDC, the customer's
18        certification that annual funding levels for the
19        energy efficiency reserve account will be equal to 2%
20        of the customer's cost of natural gas, composed of the
21        customer's commodity cost and the delivery service
22        charges paid to the gas utility, or $150,000, whichever
23        is less;
24            (D) in the case of a SDC, the customer's
25        certification that the required reserve account
26        balance will be capped at 3 years' worth of accruals

 

 

SB2365 Engrossed- 43 -LRB098 06614 MGM 36657 b

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

 

 

SB2365 Engrossed- 44 -LRB098 06614 MGM 36657 b

1        and that it will provide information establishing this
2        level, upon request of the Department;
3            (G) in the case of either an exempt customer or a
4        SDC, the customer's certification that it has provided
5        the gas utility or utilities serving the customer with
6        a copy of the application as filed with the Department;
7            (H) in the case of either an exempt customer or a
8        SDC, certification of the natural gas utility or
9        utilities serving the customer in Illinois including
10        the natural gas utility accounts that are the subject
11        of the application; and
12            (I) in the case of either an exempt customer or a
13        SDC, a verification signed by a plant manager or an
14        authorized corporate officer attesting to the
15        truthfulness and accuracy of the information contained
16        in the application.
17        (2) The Department shall review the application to
18    determine that it contains the information described in
19    provisions (A) through (I) of item (1) of this subsection
20    (m), as applicable. The review shall be completed within 30
21    days after the date the application is filed with the
22    Department. Absent a determination by the Department
23    within the 30-day period, the applicant shall be considered
24    to be a SDC or exempt customer, as applicable, for all
25    subsequent 3-year planning periods, as of the date of
26    filing the application described in this subsection (m). If

 

 

SB2365 Engrossed- 45 -LRB098 06614 MGM 36657 b

1    the Department determines that the application does not
2    contain the applicable information described in provisions
3    (A) through (I) of item (1) of this subsection (m), it
4    shall notify the customer, in writing, of its determination
5    that the application does not contain the required
6    information and identify the information that is missing,
7    and the customer shall provide the missing information
8    within 15 working days after the date of receipt of the
9    Department's notification.
10        (3) The Department shall have the right to audit the
11    information provided in the customer's application and
12    annual reports to ensure continued compliance with the
13    requirements of this subsection. Based on the audit, if the
14    Department determines the customer is no longer in
15    compliance with the requirements of items (A) through (I)
16    of item (1) of this subsection (m), as applicable, the
17    Department shall notify the customer in writing of the
18    noncompliance. The customer shall have 30 days to establish
19    its compliance, and failing to do so, may have its status
20    as a SDC or exempt customer revoked by the Department. The
21    Department shall treat all information provided by any
22    customer seeking SDC status or exemption from the
23    provisions of this Section as strictly confidential.
24        (4) Upon request, or on its own motion, the Commission
25    may open an investigation, no more than once every 3 years
26    and not before October 1, 2014, to evaluate the

 

 

SB2365 Engrossed- 46 -LRB098 06614 MGM 36657 b

1    effectiveness of the self-directing program described in
2    this subsection (m).
3    (n) The applicability of this Section to customers
4described in subsection (m) of this Section is conditioned on
5the existence of the SDC program. In no event will any
6provision of this Section apply to such customers after January
71, 2020.
8(Source: P.A. 96-33, eff. 7-10-09; 97-813, eff. 7-13-12;
997-841, eff. 7-20-12.)
 
10    Section 99. Effective date. This Act takes effect upon
11becoming law.