HF 1852

as introduced - 88th Legislature (2013 - 2014) Posted on 05/18/2013 09:52am

A bill for an act
relating to energy; expanding class of facilities eligible for the renewable energy
production incentive to include recovered energy generation facilities; amending
Minnesota Statutes 2012, sections 116C.779, subdivision 2; 216B.1691,
subdivision 1; 216C.41, subdivisions 1, 2, 3, 4.

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

Section 1.

Minnesota Statutes 2012, section 116C.779, subdivision 2, is amended to
read:

Subd. 2.

Renewable energy production incentive.

(a) Until January 1, 2021,
$10,900,000 annually must be allocated from available funds in the account to fund
renewable energy production incentives. $9,400,000 of this annual amount is for
incentives for electricity generated by wind energy conversion systems that are eligible for
the incentives under section 216C.41 or Laws 2005, chapter 40.

(b) The balance of this amount, up to $1,500,000 annually, may be used for production
incentives for on-farm biogas recovery facilities deleted text begin and deleted text end new text begin , new text end hydroelectric facilities new text begin , and recovered
energy generation facilities new text end that are eligible for the incentive under section 216C.41 or for
production incentives for other renewables, to be provided in the same manner as under
section 216C.41. new text begin Notwithstanding paragraph (a), up to $1,500,000 annually must be
allocated from available funds in the account from January 1, 2021, until December 31,
2027, to fund incentives for recovered energy generation facilities under section 216C.41.
new text end

(c) Any portion of the $10,900,000 not expended in any calendar year for the
incentive is available for other spending purposes under subdivision 1. This subdivision
does not create an obligation to contribute funds to the account.

(d) The Department of Commerce shall determine eligibility of projects under
section 216C.41 for the purposes of this subdivision. At least quarterly, the Department of
Commerce shall notify the public utility of the name and address of each eligible project
owner and the amount due to each project under section 216C.41. The public utility shall
make payments within 15 working days after receipt of notification of payments due.

Sec. 2.

Minnesota Statutes 2012, section 216B.1691, subdivision 1, is amended to read:

Subdivision 1.

Definitions.

(a) Unless otherwise specified in law, "eligible energy
technology" means an energy technology that generates electricity from the following
renewable energy sources:

(1) solar;

(2) wind;

(3) hydroelectric with a capacity of less than 100 megawatts;

(4) hydrogen, provided that after January 1, 2010, the hydrogen must be generated
from the resources listed in this paragraph; deleted text begin or
deleted text end

new text begin (5) recovered energy generation, which means electricity generated by either: (i)
converting exhaust heat from engines or from manufacturing, industrial, commercial,
or institutional sites whose primary purpose is not the generation of electricity; or (ii)
reducing pressure in gas pipelines before gas is distributed through the pipeline, provided
the conversion of energy to electricity is achieved without using additional fossil fuels; or
new text end

deleted text begin (5) deleted text end new text begin (6) new text end biomass, which includes, without limitation, landfill gas; an anaerobic
digester system; the predominantly organic components of wastewater effluent, sludge, or
related by-products from publicly owned treatment works, but not including incineration
of wastewater sludge to produce electricity; and an energy recovery facility used to
capture the heat value of mixed municipal solid waste or refuse-derived fuel from mixed
municipal solid waste as a primary fuel.

(b) "Electric utility" means a public utility providing electric service, a generation
and transmission cooperative electric association, a municipal power agency, or a power
district.

(c) "Total retail electric sales" means the kilowatt-hours of electricity sold in a year
by an electric utility to retail customers of the electric utility or to a distribution utility
for distribution to the retail customers of the distribution utility. "Total retail electric
sales" does not include the sale of hydroelectricity supplied by a federal power marketing
administration or other federal agency, regardless of whether the sales are directly to a
distribution utility or are made to a generation and transmission utility and pooled for
further allocation to a distribution utility.

Sec. 3.

Minnesota Statutes 2012, section 216C.41, subdivision 1, is amended to read:

Subdivision 1.

Definitions.

(a) The definitions in this subdivision apply to this
section.

(b) "Qualified hydroelectric facility" means a hydroelectric generating facility in
this state that:

(1) is located at the site of a dam, if the dam was in existence as of March 31, 1994; and

(2) begins generating electricity after July 1, 1994, or generates electricity after
substantial refurbishing of a facility that begins after July 1, 2001.

(c) "Qualified wind energy conversion facility" means a wind energy conversion
system in this state that:

(1) produces two megawatts or less of electricity as measured by nameplate rating
and begins generating electricity after December 31, 1996, and before July 1, 1999;

(2) begins generating electricity after June 30, 1999, produces two megawatts or
less of electricity as measured by nameplate rating, and is:

(i) owned by a resident of Minnesota or an entity that is organized under the laws
of this state, is not prohibited from owning agricultural land under section 500.24, and
owns the land where the facility is sited;

(ii) owned by a Minnesota small business as defined in section 645.445;

(iii) owned by a Minnesota nonprofit organization;

(iv) owned by a tribal council if the facility is located within the boundaries of
the reservation;

(v) owned by a Minnesota municipal utility or a Minnesota cooperative electric
association; or

(vi) owned by a Minnesota political subdivision or local government, including,
but not limited to, a county, statutory or home rule charter city, town, school district, or
any other local or regional governmental organization such as a board, commission, or
association; or

(3) begins generating electricity after June 30, 1999, produces seven megawatts or
less of electricity as measured by nameplate rating, and:

(i) is owned by a cooperative organized under chapter 308A other than a Minnesota
cooperative electric association; and

(ii) all shares and membership in the cooperative are held by an entity that is not
prohibited from owning agricultural land under section 500.24.

(d) "Qualified on-farm biogas recovery facility" means an anaerobic digester system
that:

(1) is located at the site of an agricultural operation; and

(2) is owned by an entity that is not prohibited from owning agricultural land under
section 500.24 and that owns or rents the land where the facility is located.

(e) "Anaerobic digester system" means a system of components that processes
animal waste based on the absence of oxygen and produces gas used to generate electricity.

new text begin (f) "Qualified recovered energy generation" means a facility that either:
new text end

new text begin (1) generates electricity by converting energy from exhaust heat generated by
engines or by manufacturing, industrial, commercial, or institutional sites whose primary
purpose is not the generation of electricity; or
new text end

new text begin (2) reduces the pressure in gas pipelines before gas is distributed through the
pipeline, provided the conversion of energy to electricity is achieved without using
additional fossil fuels and the facility:
new text end

new text begin (i) is located at the site of a compressor station of a natural gas pipeline regulated by
the Federal Energy Regulatory Commission;
new text end

new text begin (ii) begins generating electricity before January 1, 2017; and
new text end

new text begin (iii) produces seven megawatts or less electricity, as measured by the nameplate
rating.
new text end

Sec. 4.

Minnesota Statutes 2012, section 216C.41, subdivision 2, is amended to read:

Subd. 2.

Incentive payment; appropriation.

(a) Incentive payments must be
made according to this section to (1) a qualified on-farm biogas recovery facility, (2) the
owner or operator of a new text begin recovered energy generation system, (3) the owner or operator of
a new text end qualified hydropower facility or qualified wind energy conversion facility for electric
energy generated and sold by the facility, deleted text begin (3) deleted text end new text begin (4) new text end a publicly owned hydropower facility for
electric energy that is generated by the facility and used by the owner of the facility outside
the facility, or deleted text begin (4) deleted text end new text begin (5) new text end the owner of a publicly owned dam that is in need of substantial
repair, for electric energy that is generated by a hydropower facility at the dam and the
annual incentive payments will be used to fund the structural repairs and replacement of
structural components of the dam, or to retire debt incurred to fund those repairs.

(b) Payment may only be made upon receipt by the commissioner of commerce of
an incentive payment application that establishes that the applicant is eligible to receive an
incentive payment and that satisfies other requirements the commissioner deems necessary.
The application must be in a form and submitted at a time the commissioner establishes.

(c) There is annually appropriated from the renewable development account
under section 116C.779 to the commissioner of commerce sums sufficient to make the
payments required under this section, in addition to the amounts funded by the renewable
development account as specified in subdivision 5a.

Sec. 5.

Minnesota Statutes 2012, section 216C.41, subdivision 3, is amended to read:

Subd. 3.

Eligibility window.

Payments may be made under this section only for:

(a) electricity generated from:

(1) a qualified hydroelectric facility that is operational and generating electricity
before December 31, 2011;

(2) a qualified wind energy conversion facility that is operational and generating
electricity before January 1, 2008; or

(3) a qualified on-farm biogas recovery facility from July 1, 2001, through December
31, 2017; deleted text begin and deleted text end new text begin or
new text end

new text begin (4) a qualified recovery energy generation facility that is operational and generating
electricity before January 1, 2017; and
new text end

(b) gas generated from a qualified on-farm biogas recovery facility from July 1,
2007, through December 31, 2017.

Sec. 6.

Minnesota Statutes 2012, section 216C.41, subdivision 4, is amended to read:

Subd. 4.

Payment period.

(a) A facility may receive payments under this section for
a ten-year period. No payment under this section may be made for electricity generated:

(1) by a qualified hydroelectric facility after December 31, 2021;

(2) by a qualified wind energy conversion facility after December 31, 2018; deleted text begin or
deleted text end

(3) by a qualified on-farm biogas recovery facility after December 31, 2015 new text begin ; or
new text end

new text begin (4) by a qualified recovered energy generation facility after December 31, 2027 new text end .

(b) The payment period begins and runs consecutively from the date the facility
begins generating electricity or, in the case of refurbishment of a hydropower facility, after
substantial repairs to the hydropower facility dam funded by the incentive payments are
initiated.