Full Text of HB2875 103rd General Assembly
HB2875eng 103RD GENERAL ASSEMBLY |
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| 1 | | AN ACT concerning utilities.
| 2 | | Be it enacted by the People of the State of Illinois,
| 3 | | represented in the General Assembly:
| 4 | | Section 1. Short title. This Act may be referred to as
the | 5 | | Thermal Energy Network and Jobs Act.
| 6 | | Section 5. Legislative findings and intent. | 7 | | (a) The General Assembly finds and
declares that:
| 8 | | (1) This State has a strong interest in ensuring that | 9 | | emissions of greenhouse gases from buildings are reduced | 10 | | because buildings are one of this State's largest sources | 11 | | of greenhouse gases due to the combustion of
fossil fuels | 12 | | for heating, domestic hot water production, cooking, and | 13 | | other end uses.
| 14 | | (2) The decarbonization of buildings must be pursued | 15 | | in a manner that
is affordable and accessible, preserves | 16 | | and creates living-wage jobs, and
retains the knowledge | 17 | | and experience of the existing utility union workforce.
| 18 | | (3) Thermal energy networks have the potential to | 19 | | decarbonize buildings
at the community and utility scale | 20 | | and help achieve the goals of Public Act 102-662 (also | 21 | | known as the Climate and Equitable Jobs Act).
| 22 | | (4) Thermal energy networks consist of pipe loops | 23 | | between multiple
buildings and energy sources, which carry |
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| 1 | | water and can be connected to by building owners to | 2 | | support heating and cooling and hot water services. | 3 | | Building owners can connect to the loops to support water
| 4 | | heating and cooling and hot water services.
| 5 | | (5) Many utilities in this State have been seeking to | 6 | | develop thermal energy networks but have encountered legal | 7 | | and regulatory barriers.
| 8 | | (6) This State has a strong interest in ensuring an | 9 | | adequate supply
of reliable electrical power and, | 10 | | therefore, needs to promote the development of alternative | 11 | | power sources and take steps to assure reliable
| 12 | | deliverability. Thermal energy networks are highly | 13 | | efficient because
they use and exchange thermal energy | 14 | | from many underground sources
and buildings, including | 15 | | recycled thermal energy, which minimizes impacts on
the | 16 | | electricity grid.
| 17 | | (7) Access to thermal energy networks has the | 18 | | potential to reduce the
upfront and operating costs of | 19 | | building electrification for customers.
| 20 | | (8) A utility's access to capital, the utility's | 21 | | experience with networked
infrastructure in public | 22 | | rights-of-way, and the requirement that the utility
serve | 23 | | all customers positions the utility well to develop and | 24 | | scale thermal
energy networks that are accessible to all | 25 | | customers and to coordinate
the development of thermal | 26 | | energy networks with any orderly rightsizing of the
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| 1 | | utility gas system.
| 2 | | (9) This State also has an interest in the efficient | 3 | | and
reliable delivery of energy and the energy | 4 | | infrastructure of the State,
which interest is | 5 | | acknowledged throughout the Public Utilities Act. Utility | 6 | | corporations and other power suppliers share these | 7 | | interests and, moreover, have a duty to protect | 8 | | proprietary interests in the projects they fund. Such | 9 | | investments of ratepayer resources can be protected by | 10 | | establishing effective contractor qualification and | 11 | | performance standards, including requirements for | 12 | | prevailing wage rates, bona fide apprenticeship criteria, | 13 | | and project labor agreements.
| 14 | | (10) The construction industry is highly skilled and | 15 | | labor intensive,
and the installation of modern thermal | 16 | | energy networks involves particularly complex work. | 17 | | Therefore, effective qualification standards
for craft | 18 | | labor personnel employed on these projects are critically
| 19 | | needed to promote successful project delivery.
| 20 | | (11) Finally, these findings are especially vital now | 21 | | because the construction industry is experiencing | 22 | | widespread skill shortages across the country, which are | 23 | | crippling existing capital projects and threatening | 24 | | projects planned for the future. The construction of | 25 | | thermal energy networks will utilize many of the same | 26 | | skills that the current utility and building trades |
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| 1 | | workforces already possess.
| 2 | | (b) It is the intent of the General Assembly that passage | 3 | | of this Act is for the following purposes: | 4 | | (1) to remove the legal barriers to utility | 5 | | development of thermal
energy networks and require the | 6 | | Illinois Commerce Commission, within 90 days after the | 7 | | effective date of this amendatory Act of the 103rd General | 8 | | Assembly, to begin to authorize and direct utilities to | 9 | | immediately commence piloting thermal energy networks in | 10 | | each and every utility territory;
| 11 | | (2) to direct and authorize the Illinois Commerce | 12 | | Commission to develop a regulatory structure for utility | 13 | | thermal energy networks that scales affordable and | 14 | | accessible building electrification, protects customers, | 15 | | and balances the role of incumbent monopoly utilities with | 16 | | other market and public actors;
| 17 | | (3) to promote the successful planning and delivery of | 18 | | thermal energy
networks and protect critical investments | 19 | | in such projects by requiring the use of appropriate | 20 | | quality craft labor policies that ensure the development | 21 | | of and access to an adequate supply of well trained, | 22 | | highly skilled craft persons needed to support timely, | 23 | | reliable, high-quality projects;
| 24 | | (4) to promote strong economic development and good | 25 | | jobs for local
residents in the expanding decarbonized | 26 | | sector by requiring application of progressive State labor |
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| 1 | | and employment policies that ensure public utility | 2 | | investments and related State subsidies create | 3 | | unparalleled skill training and employment opportunities | 4 | | for residents in project areas through the use of local | 5 | | prevailing wage standards and successful, bona fide | 6 | | apprenticeship programs or project labor agreements that | 7 | | incorporate prevailing wage and training standards and | 8 | | provide additional benefits for project owners and | 9 | | workers; and
| 10 | | (5) to promote the use of preapprenticeship programs | 11 | | that will fortify and expand existing apprenticeship | 12 | | programs through systematic outreach efforts to recruit | 13 | | and assist persons from underrepresented and low income | 14 | | communities by providing such persons with remedial | 15 | | education, social services, and unique opportunities for | 16 | | direct access into high-quality apprenticeship programs | 17 | | and gainful employment in the growing building | 18 | | decarbonization workforce.
| 19 | | Section 900. The Public Utilities Act is amended by | 20 | | changing Sections 3-101 and by adding Sections 3-127, 3-128, | 21 | | and 8-513 as follows:
| 22 | | (220 ILCS 5/3-101) (from Ch. 111 2/3, par. 3-101)
| 23 | | Sec. 3-101. Definitions. Unless otherwise specified, the | 24 | | terms set forth
in Sections 3-102 through 3-128 3-126 are used |
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| 1 | | in this Act as therein defined.
| 2 | | (Source: P.A. 97-96, eff. 7-13-11; 97-239, eff. 8-2-11; | 3 | | 97-813, eff. 7-13-12.)
| 4 | | (220 ILCS 5/3-127 new) | 5 | | Sec. 3-127. Thermal energy. "Thermal energy" means piped
| 6 | | noncombustible fluids used for transferring heat into and out | 7 | | of buildings for the purpose of reducing any resultant
onsite | 8 | | greenhouse gas emissions of all types of heating and cooling | 9 | | processes, including, but not limited to, comfort heating and | 10 | | cooling, domestic hot water, and refrigeration. | 11 | | (220 ILCS 5/3-128 new) | 12 | | Sec. 3-128. Thermal energy network. "Thermal energy
| 13 | | network" means all real estate, fixtures, and personal | 14 | | property operated, owned, used, or to be used for, in | 15 | | connection with, or to facilitate a utility-scale distribution | 16 | | infrastructure project that supplies thermal energy. | 17 | | (220 ILCS 5/8-513 new) | 18 | | Sec. 8-513. Pilot thermal energy network development. | 19 | | (a) The Illinois Commerce Commission shall initiate a | 20 | | proceeding within 6 months after the effective date of this | 21 | | amendatory Act of the 103rd General Assembly to support the | 22 | | development of pilot thermal energy networks. The Commission | 23 | | shall consider matters in the proceeding, including, but not |
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| 1 | | limited to, the appropriate ownership, market, and rate | 2 | | structures for pilot thermal energy networks and whether the | 3 | | provision of thermal energy services by thermal network energy | 4 | | providers is in the public interest. | 5 | | (b) Within 12 months after the effective date of this | 6 | | amendatory Act of the 103rd General Assembly, any gas public | 7 | | utility, electric public utility, or combination public | 8 | | utility serving over 100,000 customers shall file with the | 9 | | Commission a petition seeking Commission approval of at least | 10 | | one and no more than 3 proposed pilot thermal energy network | 11 | | projects. Designs for the projects should coordinate and | 12 | | maximize the value of existing State energy efficiency and | 13 | | weatherization programs and take full advantage of federal | 14 | | funding opportunities. No later than 18 months after the | 15 | | effective date of this amendatory Act of the 103rd General | 16 | | Assembly, the Commission shall enter an order approving, | 17 | | approving with modification, or rejecting each proposed pilot | 18 | | thermal energy network project and shall direct the public | 19 | | utility to implement the pilot thermal energy network projects | 20 | | as approved or approved as modified. In considering whether to | 21 | | approve or approve as modified each pilot thermal energy | 22 | | network project, the Commission shall consider whether the | 23 | | pilot thermal energy network project is in the public | 24 | | interest, whether the pilot thermal energy network project | 25 | | will develop information useful for the Commission in adopting | 26 | | rules governing thermal energy
networks, whether the pilot |
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| 1 | | thermal energy network project furthers climate justice and | 2 | | emissions reduction, whether the pilot thermal energy network | 3 | | project advances financial and technical approaches to | 4 | | equitable and
affordable building electrification, and whether | 5 | | the pilot thermal energy network project creates benefits to | 6 | | customers and society at large, including, but not limited to, | 7 | | public health benefits in areas with disproportionate | 8 | | environmental or public health burdens, job retention and | 9 | | creation, reliability, and increased
affordability of | 10 | | renewable thermal energy options. | 11 | | (c) If a utility proposes 3 pilot thermal energy network | 12 | | projects, at least one project shall be proposed in | 13 | | economically disadvantaged communities and at least one shall | 14 | | be focused on existing electric heat customers. Each public | 15 | | utility shall coordinate with other public utilities and | 16 | | consultants with expertise on successful pilot projects to | 17 | | ensure that the pilot projects are diverse and designed to | 18 | | inform the Commission's decisions in the proceeding on the | 19 | | various ownership, market, and rate structures for thermal | 20 | | energy networks. The pilot project proposals shall be made | 21 | | publicly available on the Commission's website. | 22 | | (d) Any gas public utility, electric public utility, or | 23 | | combination public utility constructing or operating a | 24 | | Commission-approved pilot thermal energy network project shall | 25 | | report to the Commission, on a quarterly basis and until | 26 | | completion of the pilot thermal energy network project, as |
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| 1 | | determined by the Commission, the status of each pilot thermal | 2 | | energy network project. The Commission shall post and make | 3 | | publicly available the reports on its website. The report | 4 | | shall include, but not be limited to: | 5 | | (1) the stage of development of each pilot project; | 6 | | (2) the barriers to development; | 7 | | (3) the number of customers served; | 8 | | (4) the costs of the pilot project; | 9 | | (5) the number of jobs retained or created by the | 10 | | pilot project; and | 11 | | (6) any other information the Commission deems to
be | 12 | | in the public interest or considers likely to prove useful | 13 | | or relevant to the rulemaking described in subsection (h). | 14 | | (e) Any gas public utility, electric public utility, or | 15 | | combination public utility constructing or operating a | 16 | | Commission-approved pilot thermal energy network project shall | 17 | | demonstrate that it has entered into a labor peace agreement | 18 | | with a bona fide labor organization that is actively engaged | 19 | | in representing its employees. The labor peace agreement shall | 20 | | apply to the employees necessary for the ongoing maintenance | 21 | | and operation of the thermal energy network. The labor peace | 22 | | agreement shall be an ongoing material condition of | 23 | | authorization to maintain and operate the thermal energy | 24 | | networks. | 25 | | (f) Any contractor or subcontractor that performs work on
| 26 | | a pilot thermal energy network under this Section shall be a
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| 1 | | responsible bidder as described in Section 30-22 of the
| 2 | | Illinois Procurement Code and shall certify that not less than | 3 | | prevailing wage, as determined under the Prevailing Wage Act, | 4 | | was or will be paid to employees who are engaged in | 5 | | construction activities associated with the pilot thermal | 6 | | energy network project. The contractor or subcontractor
shall | 7 | | submit evidence to the Commission that it complied with the | 8 | | requirements of this subsection. | 9 | | (g) For any pending application for a thermal energy | 10 | | network, the contractor or subcontractor shall submit evidence | 11 | | that the contractor or subcontractor has entered into a fully | 12 | | executed project labor agreement with the applicable local | 13 | | building trades council. The Commission shall not approve any | 14 | | pending applications until the contractor or subcontractor has | 15 | | submitted the information required under this subsection. | 16 | | (h) Within 4 years after the completion of the | 17 | | construction of all thermal energy network projects under this | 18 | | Section, the Commission shall adopt rules to, at a minimum: | 19 | | (1) create fair market access rules for
thermal energy | 20 | | networks to accept thermal energy and that do
not increase | 21 | | greenhouse gas emissions or copollutants; | 22 | | (2) to the extent it is in the public interest to do | 23 | | so, exempt small-scale thermal energy networks from active | 24 | | regulation by the Commission; | 25 | | (3) promote the training and transition of utility
| 26 | | workers impacted by this amendatory Act of the 103rd
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| 1 | | General Assembly; and | 2 | | (4) encourage third-party participation and
| 3 | | competition where it will maximize benefits to customers. | 4 | | (i) A gas public utility, electric public utility, or | 5 | | combination public utility required to develop any pilot | 6 | | thermal energy network project under this Section shall be | 7 | | permitted to recover all reasonable and prudently incurred | 8 | | costs associated with the development, construction, and | 9 | | operation of one or more pilot thermal energy network projects | 10 | | through general rates set pursuant to Section 9-201 or through | 11 | | rates set in a Multi-Year Rate Plan pursuant to Section | 12 | | 16-108.18.
| 13 | | Section 999. Effective date. This Act takes effect upon | 14 | | becoming law.
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