SF 1424

as introduced - 91st Legislature (2019 - 2020) Posted on 02/22/2019 02:27pm

A bill for an act
relating to solar energy; establishing a grant program to enable school districts to
finance the installation of solar energy systems on school buildings; creating an
account and a reserve account; appropriating money; proposing coding for new
law in Minnesota Statutes, chapter 216C.

BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MINNESOTA:

Section 1.

new text begin [216C.375] SOLAR ON SCHOOLS PROGRAM.
new text end

new text begin Subdivision 1. new text end

new text begin Definitions. new text end

new text begin (a) For the purposes of this section, the following terms have
the meanings given them.
new text end

new text begin (b) "Energy storage system" means a commercially available technology capable of (1)
absorbing and storing electrical energy, and (2) dispatching stored electrical energy at a
later time.
new text end

new text begin (c) "Investor" means an entity that finances the design, purchase, installation, operation
and maintenance of a solar energy system installed at a school building in a school district
that received a grant under this section.
new text end

new text begin (d) "Photovoltaic device" has the meaning given in section 216C.06, subdivision 16.
new text end

new text begin (e) "School district" means an independent or special school district.
new text end

new text begin (f) "Solar energy system" means photovoltaic devices installed alone or in conjunction
with an energy storage system.
new text end

new text begin Subd. 2. new text end

new text begin Establishment; purpose. new text end

new text begin A solar on schools program is established in the
Department of Commerce. The program's purpose is to provide grants to stimulate the
installation of solar energy systems in school districts throughout the state by reducing the
cost to purchase and install solar energy systems.
new text end

new text begin Subd. 3. new text end

new text begin Establishment of account; reserve account. new text end

new text begin (a) A solar on schools program
reserve account number 1 is established in the renewable development account under section
116C.779, subdivision 1, paragraph (a). Money received from the renewable development
account must be transferred to the commissioner of commerce and credited to this account.
Money in the account is held in the account and does not lapse.
new text end

new text begin (b) A solar on schools program reserve account number 2 is established in the renewable
development account under section 116C.779, subdivision 1, paragraph (a). Money received
from the general fund must be transferred to the commissioner of commerce and credited
to this account. Money in the account is held in the account and does not lapse.
new text end

new text begin (c) When a grant is awarded under this section, the commissioner must reserve in the
applicable account the amount of funds necessary to enable the school district to acquire
the investor's entire financial interest in the solar energy system and terminate the power
purchase agreement, as stated in the power purchase agreement.
new text end

new text begin Subd. 4. new text end

new text begin Expenditures. new text end

new text begin Money in the account and reserve account may be used only:
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new text begin (1) for grant awards made under this section; and
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new text begin (2) to pay the reasonable costs incurred by the department to administer this section.
new text end

new text begin Subd. 5. new text end

new text begin Eligible system. new text end

new text begin A grant may be awarded under this section to an eligible school
district only if the solar energy system that is the subject of the grant:
new text end

new text begin (1) is placed on, adjacent to, or in proximity to the school district building using the
electricity generated; and
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new text begin (2) has a capacity that does not exceed 300 kilowatts or 120 percent of the estimated
electric load of the school district building where the solar energy system is proposed to be
installed, whichever is greater.
new text end

new text begin Subd. 6. new text end

new text begin Eligible grant expenditures. new text end

new text begin Grants awarded to a school district under this
section must be used to acquire the entire financial interest in a solar energy system held
by an investor under a power purchase agreement signed with the school district.
new text end

new text begin Subd. 7. new text end

new text begin Power purchase agreement; design. new text end

new text begin The commissioner must design a power
purchase agreement that must be used by an applicant seeking a grant under this section
and an investor. The power purchase agreement must:
new text end

new text begin (1) authorize a school district to use a grant awarded under this section to acquire the
investor's entire financial interest in the solar energy system and terminate the power purchase
agreement when both parties agree to the terms of the acquisition;
new text end

new text begin (2) contain a formula to calculate the future fair market value of the solar energy system;
new text end

new text begin (3) contain a formula to calculate the future value of payments to be made by the school
district to the investor under the power purchase agreement in the absence of an acquisition
described in clause (1);
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new text begin (4) specify an escalator for the allowable rate of increase for costs over the term of the
power purchase agreement of the utility providing retail electricity service to the school
where the solar energy system is located; and
new text end

new text begin (5) not exceed a term of 20 years.
new text end

new text begin Subd. 8. new text end

new text begin Ancillary agreement. new text end

new text begin At the same time the power purchase agreement is
executed, the school district and the investor must enter into a separate agreement requiring
the investor to continue operating and maintaining the solar energy system through the term
of the original power purchase agreement.
new text end

new text begin Subd. 9. new text end

new text begin Adjustment. new text end

new text begin (a) Every five years after entering into the power purchase
agreement, and just prior to the proposed termination of the power purchase agreement, the
parties to the agreement must reexamine the projected values based on the formulas in the
power purchase agreement described in subdivision 7, clauses (2) to (4).
new text end

new text begin (b) The parties must notify the commissioner of any significant adjustments that should
be made to the future values forecasts in subdivision 7, clauses (2) to (4), based on experience
under the power purchase agreement or for other reasons.
new text end

new text begin (c) The commissioner must review the adjustments requested by the parties and must
approve the adjustments if the commissioner determines the adjustments:
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new text begin (1) are reasonable;
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new text begin (2) were unforeseeable to the parties at the time the power purchase agreement was
entered into or at the previous reexamination of the projected values; and
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new text begin (3) are in the public interest.
new text end

new text begin (d) The commissioner must adjust the amount reserved in the applicable reserve account
for the project to conform with adjustments approved under this subdivision.
new text end

new text begin Subd. 10. new text end

new text begin Application process. new text end

new text begin A school district must submit an application to the
commissioner on a form prescribed by the commissioner. The commissioner must develop
administrative procedures governing the application and grant award process, and must
award grants on a first-come, first-served basis.
new text end

new text begin Subd. 11. new text end

new text begin Duties of the commissioner. new text end

new text begin The commissioner must:
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new text begin (1) provide technical assistance to school districts to develop and execute projects; and
new text end

new text begin (2) convene an advisory committee composed of representatives of solar energy
developers, school districts, and investors to develop procedures and policies that result in
the successful operation of the program established under this section.
new text end

new text begin Subd. 12. new text end

new text begin Grant payments. new text end

new text begin The commissioner must make a grant payment to the school
district, as adjusted under subdivision 10, if applicable, within 30 days of the date the
commissioner receives a copy of the agreement, signed by both parties, by which the school
district acquires the entire financial interest of the investor in the solar energy system and
which terminates the original power purchase agreement.
new text end

new text begin Subd. 13. new text end

new text begin Application deadline. new text end

new text begin An application must not be made under this section
after December 31, 2023.
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new text begin EFFECTIVE DATE. new text end

new text begin This section is effective the day following final enactment.
new text end

Sec. 2. new text begin APPROPRIATION.
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new text begin (a) $....... in fiscal year 2020 is transferred from the renewable development account
under Minnesota Statutes, section 116C.779, subdivision 1, to the commissioner of commerce
to conduct the program established under Minnesota Statutes, section 216C.375. The
commissioner of commerce must deposit the appropriation in the account established under
Minnesota Statutes, section 216C.375, subdivision 3, paragraph (a).
new text end

new text begin (b) $....... in fiscal year 2020 is appropriated from the general fund to the commissioner
of commerce to conduct the program established under Minnesota Statutes, section 216C.375.
The commissioner of commerce must deposit the appropriation in the account established
under Minnesota Statutes, section 216C.375, subdivision 3, paragraph (b).
new text end

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective the day following final enactment.
new text end