HF 3102

as introduced - 93rd Legislature (2023 - 2024) Posted on 03/23/2023 01:31pm

A bill for an act
relating to energy; modifying the solar for schools program; transferring money;
amending Minnesota Statutes 2022, sections 216C.375, subdivisions 1, 2, 3, 4, 5,
6, 7, 9, 10, 11, by adding subdivisions; 216C.376, subdivision 1, by adding a
subdivision; repealing Minnesota Statutes 2022, section 216C.376, subdivisions
2, 3, 4, 5, 6, 7, 8, 9.

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

Section 1.

Minnesota Statutes 2022, section 216C.375, subdivision 1, is amended to read:

Subdivision 1.

Definitions.

(a) For the purposes of this section and section 216C.376,
the following terms have the meanings given them.

new text begin (b) "Competitive grant" means the grant the commissioner awards to a school to (1)
stimulate the installation of solar energy systems on school buildings or on school property
adjacent to a school building by reducing the upfront costs, and (2) enable schools to use
the solar energy system as a teaching tool that can be integrated into the school's curriculum.
new text end

new text begin (c) "Curriculum support grant" means a grant the commissioner awards to a school to
make the solar energy system a visible learning tool for students, teachers, staff, and the
public, including workforce and career opportunities for students.
new text end

deleted text begin (b) deleted text end new text begin (d) new text end "Developer" means an entity that installs a solar energy system on a school
building that has been awarded a grant under this section.

new text begin (e) "Loan" means a loan the commissioner issues to a school borrower in order to support
payment of the balance of solar energy system installation costs after accounting for the
competitive grant and any additional upfront incentives paid to the school by the electric
utility or a local governmental unit, provided that the school owns the solar energy system
throughout the loan term.
new text end

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

deleted text begin (d) deleted text end new text begin (g) new text end "School" means: (1) a school that operates as part of an independent or special
school district; new text begin (2) a Tribal school; new text end or deleted text begin (2) deleted text end new text begin (3) new text end a state college or university that is under the
jurisdiction of the Board of Trustees of the Minnesota State Colleges and Universities.

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

deleted text begin (f) deleted text end new text begin (i) new text end "Solar energy system" means photovoltaic or solar thermal devices.

deleted text begin (g) deleted text end new text begin (j) new text end "Solar thermal" has the meaning given to "qualifying solar thermal project" in
section 216B.2411, subdivision 2, paragraph (d).

deleted text begin (h) deleted text end new text begin (k) new text end "State colleges and universities" has the meaning given in section 136F.01,
subdivision 4.

Sec. 2.

Minnesota Statutes 2022, section 216C.375, subdivision 2, is amended to read:

Subd. 2.

Establishment; purpose.

A solar for schools program is established in the
Department of Commerce. The purpose of the program is to provide new text begin : (1) competitive new text end grants
to stimulate the installation of solar energy systems on or adjacent to school buildings by
reducing deleted text begin the cost, and to enable schools to use deleted text end new text begin costs, including interconnection costs and
other infrastructure costs directly related to installing the solar energy system; (2) loans to
schools to support the balance of solar installation costs after accounting for the competitive
grant and any additional upfront incentives paid to the school by the electric utility or a
local governmental unit, provided that the school owns the solar energy system throughout
the loan term; (3) new text end new text begin curriculum support grants to schools to make new text end the solar energy system deleted text begin as deleted text end
a teaching tool that can be integrated into the school's curriculum new text begin ; and (4) new text end new text begin technical assistance
and other services to schools seeking to install solar energy systems new text end .

Sec. 3.

Minnesota Statutes 2022, section 216C.375, subdivision 3, is amended to read:

Subd. 3.

Establishment of account.

A solar for schools program account is established
in the special revenue fund. Money received from the general fund must be transferred to
the commissioner of commerce and credited to the account. Except as otherwise provided
in this paragraph, money deposited in the account remains in the account until expended.
Any money that remains in the account on June 30, deleted text begin 2027 deleted text end new text begin 2035 new text end , cancels to the general fund.

Sec. 4.

Minnesota Statutes 2022, section 216C.375, subdivision 4, is amended to read:

Subd. 4.

Expenditures.

(a) Money in the account new text begin is appropriated to the commissioner
and new text end may be used only:

(1) for new text begin competitive new text end grant awards made under this section; deleted text begin and
deleted text end

new text begin (2) for curriculum support grants made under this section;
new text end

new text begin (3) for loans to schools made under this section;
new text end

new text begin (4) to pay for technical assistance to schools under this section; and
new text end

deleted text begin (2) deleted text end new text begin (5) new text end to pay the reasonable costs incurred by the department to administer this section.

(b) new text begin Competitive new text end grant awards new text begin , curriculum support grants, and loans to schools that receive
service from the utility subject to section 116C.779 may be new text end made new text begin only new text end with deleted text begin funds deleted text end new text begin money new text end
in the account deleted text begin must be used only for grants for solar energy systems installed on or adjacent
to school buildings receiving retail electric service from a utility that is not subject to deleted text end new text begin
transferred from the account established under new text end section 116C.779, subdivision 1 new text begin , paragraph
(e), pursuant to section 216C.376, subdivision 1 new text end .

Sec. 5.

Minnesota Statutes 2022, section 216C.375, subdivision 5, is amended to read:

Subd. 5.

Eligible system.

(a) A grant may be awarded to a school under this section
only if the solar energy system that is the subject of the grant:

(1) is installed on or adjacent to the school building that consumes the electricity generated
by the solar energy system, on property within the service territory of the utility currently
providing electric service to the school building;

(2) has a capacity that does not exceed deleted text begin the lesser of 40 kilowatts or deleted text end 120 percent of the
estimated annual electricity consumption of the school building at which the solar energy
system is installed new text begin , new text end new text begin as determined (i) by the total consumption of the applicable electricity
premise during any 12-month period during the last three years immediately prior to
application for a competitive grant or a loan under this section, and (ii) after including any
projected additional future electrical consumption estimated by a professional engineer or
a certified energy manager, accounting for: (A) forecasted installation of electric vehicle
charging infrastructure for school vehicles; (B) electric heat pump or other geo-exchange
heating and cooling equipment; and (C) other low-carbon electrification measures new text end ; and

(3) has real-time and cumulative display devices, located in a prominent location
accessible to students and the public, that indicate the system's electrical performance.

(b) A school that receives a rebate or other financial incentive under section 216B.241
for a solar energy system and that demonstrates considerable need for financial assistance,
as determined by the commissioner, is eligible for a grant under this section for the same
solar energy system.

Sec. 6.

Minnesota Statutes 2022, section 216C.375, subdivision 6, is amended to read:

Subd. 6.

Application process.

(a) The commissioner must issue a request for proposals
to utilities, schools, and developers deleted text begin who may wish deleted text end to apply for a new text begin competitive new text end grant new text begin , a
curriculum support grant, or a loan new text end under this section on behalf of a school. new text begin The commissioner
may issue: (1) a single request for proposals for applications for the competitive grant
program, curriculum support program, and loan program; or (2) individual requests for
proposals for each program under clause (1).
new text end

(b) A new text begin school, new text end utility new text begin , new text end or developer deleted text begin must deleted text end new text begin may new text end submit an application new text begin for a competitive
grant new text end to the commissioner on behalf of a school on a form prescribed by the commissioner.

new text begin (c) A school must apply for a curriculum support grant or a loan under this section.
new text end

new text begin (d) new text end The new text begin application new text end form must include, at a minimum, the following information:

(1) the capacity of the proposed solar energy system and the new text begin expected new text end amount of
electricity deleted text begin that is expected to be deleted text end generated;

(2) the current energy demand of the school building deleted text begin on deleted text end new text begin to new text end which the solar energy
generating system is to be deleted text begin installed deleted text end new text begin interconnected new text end and information regarding any distributed
energy resource, including subscription to a community solar garden, that currently provides
electricity to the school building;

new text begin (3) the projected additional future electrical demand of the school building, after
accounting for forecasted installation of (i) electric vehicle charging infrastructure for school
vehicles, (ii) electric heat pumps or other geo-exchange heating and cooling equipment,
and (iii) other low-carbon electrification measures, provided that the forecast has been
completed by a professional engineer or certified energy manager;
new text end

new text begin (4) calculations that demonstrate the solar energy system is projected to generate no
more than 120 percent of the sum of (i) the current energy demand of the school building
under clause (2), and (ii) the projected additional future electrical demand under clause (3);
new text end

deleted text begin (3) deleted text end new text begin (5) new text end a description of any solar thermal devices proposed as part of the solar energy
system;

deleted text begin (4) deleted text end new text begin (6) new text end the total cost to purchase and install the solar energy system and the solar energy
system's lifecycle cost, including removal and disposal at the end of the system's life;

deleted text begin (5) deleted text end new text begin (7) new text end a copy of the proposed contract agreement between the school and the public
utility or developer that includes provisions addressing responsibility for maintenance of
the solar energy system;

deleted text begin (6) deleted text end new text begin (8) new text end the school's plan to make the solar energy system serve as a visible learning tool
for students, teachers, and deleted text begin visitors to deleted text end the deleted text begin school deleted text end new text begin public new text end , including new text begin (i) new text end how the solar energy
system may be integrated into the school's curriculum new text begin , new text end deleted text begin and deleted text end new text begin (ii) new text end provisions for real-time
monitoring of the solar energy system performance for display in a prominent location
within the school or on-demand in the classroom new text begin , and (iii) solar energy and environmentally
friendly workforce and career opportunities for students and the public new text end ;

deleted text begin (7) deleted text end new text begin (9) new text end information that demonstrates the school's level of need for financial assistance
available under this section;

deleted text begin (8) deleted text end new text begin (10) new text end information that demonstrates the school's readiness to implement the project,
including but not limited to the availability of the site on which the solar energy system is
to be installed and the level of the school's engagement with the utility providing electric
service to the school building on which the solar energy system is to be installed on issues
relevant to the implementation of the project, including metering and other issues;

deleted text begin (9) deleted text end new text begin (11) new text end with respect to the installation and operation of the solar energy system, the
willingness and ability of the developer or the public utility to:

(i) pay employees and contractors a prevailing wage rate, as defined in section 177.42,
subdivision 6; and

(ii) adhere to the provisions of section 177.43;

new text begin (12) the interconnection and utility infrastructure required to install the solar energy
systems, provided that the upgrades to main electrical panels, transformers, substations, and
other infrastructure are necessary and directly related to the solar installation;
new text end

deleted text begin (10) deleted text end new text begin (13) new text end how the developer or public utility plans to reduce the school's initial capital
expense to purchase and install the solar energy system by providing financial assistance
to the school; and

deleted text begin (11) deleted text end new text begin (14) new text end any other information deemed relevant by the commissioner.

deleted text begin (c) deleted text end new text begin (e) new text end The commissioner must administer an open application process new text begin for competitive
grants and curriculum support grants new text end under this section at least twice annually.

new text begin (f) The commissioner must administer an open application process under this section
on a rolling basis for solar for school loans.
new text end

deleted text begin (d) deleted text end new text begin (g) new text end The commissioner must develop administrative procedures governing the
application and deleted text begin grant deleted text end award process new text begin for competitive grants, curriculum support grants, and
solar for school loans new text end .

Sec. 7.

Minnesota Statutes 2022, section 216C.375, subdivision 7, is amended to read:

Subd. 7.

Energy conservation review.

At the commissioner's request, a school awarded
a grant under this section shall provide the commissioner information regarding new text begin participation
in the utility's energy conservation and optimization program under section 216B.241,
including any new text end energy conservation measures implemented at the school building at which
the solar energy system is installed. The commissioner may make new text begin additional new text end
recommendations to the school regarding cost-effective conservation measures it can
implement and may provide technical assistance and direct the school to available financial
assistance programs.

Sec. 8.

Minnesota Statutes 2022, section 216C.375, is amended by adding a subdivision
to read:

new text begin Subd. 7a. new text end

new text begin Interconnection. new text end

new text begin A utility must establish procedures governing the engineering
review and interconnection process for solar installations supported by competitive grants
or loans under this section. A solar for schools project under this section must receive an
initial engineering review within 60 days of the date a complete project application is
submitted. A solar for schools project must receive final witness testing and permission to
operate within 30 days of the date an application is submitted. A utility that fails to meet
the requirements of this subdivision is subject to a fine of $100 per day, which must be paid
to the commissioner and deposited in solar for schools account under subdivision 3.
new text end

Sec. 9.

Minnesota Statutes 2022, section 216C.375, subdivision 9, is amended to read:

Subd. 9.

new text begin Competitive new text end grant payments.

new text begin (a) new text end The commissioner must award a new text begin competitive new text end
grant from the account established under subdivision 3 to a school for the necessary costs
associated with the purchase and installation of a solar energy system. The amount of the
grant must be based on the commissioner's assessment of the school's need for financial
assistance. new text begin A school must not receive a grant in excess of $........ Grant expenses related to
interconnection costs or directly related infrastructure upgrade costs necessitated by the
solar installation must be limited to $250,000 per school. Grant expenses related to
interconnection costs or infrastructure upgrade costs may include the costs incurred by the
utility or by the solar installation contractor.
new text end

new text begin (b) For competitive grant awards to schools served by the utility subject to section
116C.779, the commissioner may prioritize schools where more than 50 percent of students
are eligible for free and reduced-price lunch under the National School Lunch Program.
new text end

Sec. 10.

Minnesota Statutes 2022, section 216C.375, is amended by adding a subdivision
to read:

new text begin Subd. 9a. new text end

new text begin Curriculum support grant payments. new text end

new text begin (a) The commissioner must award a
curriculum support grant from the account established under subdivision 3 to a school to
make the solar energy system a visible learning tool for students, teachers, staff, and the
public, including workforce and career opportunities for students.
new text end

new text begin (b) The commissioner may make up to $2,000,000 of curriculum support grant awards
annually under this section.
new text end

Sec. 11.

Minnesota Statutes 2022, section 216C.375, is amended by adding a subdivision
to read:

new text begin Subd. 9b. new text end

new text begin Solar for schools loans. new text end

new text begin The commissioner must award a loan from the account
established under subdivision 3 to a school to support the balance of solar installation costs,
after accounting for the competitive grant and any additional upfront incentives paid to the
school by the electric utility or a local governmental unit, provided that the school owns
the solar energy system throughout the loan term. Loans provided under this section must
be made without regard to the status of a grant award under this section.
new text end

new text begin (b) The total principal of loans provided to any single school, Tribal school, or charter
school with common directors or trustees must not exceed $1,000,000. Loans provided
under this section must not include any charged or accrued interest.
new text end

new text begin (c) A loan issued under this section is not: (1) subject to any referendum that prohibits
the school district from borrowing money under section 123B.63; and (2) included in a
school district's debt limits under section 475.53.
new text end

Sec. 12.

Minnesota Statutes 2022, section 216C.375, is amended by adding a subdivision
to read:

new text begin Subd. 9c. new text end

new text begin Renewable energy credits. new text end

new text begin The renewable energy credits associated with the
electricity generated by a solar energy system installed under this section are the property
of the public utility subject to this section for the life of the system, regardless of the duration
of the financial assistance provided by the public utility under this section.
new text end

Sec. 13.

Minnesota Statutes 2022, section 216C.375, is amended by adding a subdivision
to read:

new text begin Subd. 9d. new text end

new text begin Net metering. new text end

new text begin Notwithstanding the capacity limits under section 216B.164,
subdivision 3, a school with a solar installation having a capacity of no more than 250
kilowatts may elect to be compensated for the customer's net input into the utility system
in the form a kilowatt-hour credit on the school's energy bill carried forward and applied
to subsequent energy bills, with any net input supplied by the customer into the utility system
that exceeds the energy supplied to the customer by the utility to be compensated at the
average retail energy rate. For the purposes of this subdivision, "average retail energy rate"
has the meaning given in section 216B.164, subdivision 3. This subdivision does not apply
to a school receiving a value of solar rate under section 216B.164, subdivision 10.
new text end

Sec. 14.

Minnesota Statutes 2022, section 216C.375, subdivision 10, is amended to read:

Subd. 10.

Application deadline.

No application may be submitted under this section
after December 31, deleted text begin 2025 deleted text end new text begin 2033 new text end .

Sec. 15.

Minnesota Statutes 2022, section 216C.375, subdivision 11, is amended to read:

Subd. 11.

Reporting.

Beginning January 15, 2022, and each year thereafter until January
15, deleted text begin 2028 deleted text end new text begin 2036 new text end , the commissioner must report to the chairs and ranking minority members
of the legislative committees with jurisdiction over energy regarding: (1) grants and amounts
awarded to schools under this section during the previous year; (2) new text begin loans and amounts
awarded to schools under this section during the previous year; (3) the total capacity of all
solar installations on all Minnesota schools and the capacity installed during the previous
year, including the number of school installations supported by grants and loans under this
section; new text end new text begin (4) new text end financial assistance, including amounts per award, provided to schools under
section 216C.376 during the previous year; and deleted text begin (3) deleted text end new text begin (5) new text end any remaining balances available
under this section and section 216C.376.

Sec. 16.

Minnesota Statutes 2022, section 216C.376, subdivision 1, is amended to read:

Subdivision 1.

deleted text begin Establishment; purpose deleted text end new text begin Transfer new text end .

new text begin Notwithstanding section 116C.779,
subdivision 1, paragraph (j), beginning July 1, 2023, and until June 30, 2035, new text end the utility
subject to section 116C.779 must deleted text begin operate a program to provide financial assistance to enable
schools to install and operate solar energy systems that can be used as teaching tools and
be integrated into the school curriculum deleted text end new text begin annually transfer $8,000,000 from the renewable
development account under section 116C.779, subdivision 1, to the solar new text end new text begin for schools account
under section 216C.375, subdivision 3 new text end .

Sec. 17.

Minnesota Statutes 2022, section 216C.376, is amended by adding a subdivision
to read:

new text begin Subd. 2a. new text end

new text begin Use of money. new text end

new text begin The money transferred to the solar for schools account under
subdivision 1 must be used to pay for competitive grants, curriculum support grants, and
solar for schools loans under section 216C.375, to applicants located within the service
territory of the utility subject to section 116C.779.
new text end

Sec. 18. new text begin SOLAR FOR SCHOOLS PROGRAM; TRANSFER.
new text end

new text begin (a) $250,000,000 in fiscal year 2024 is transferred from the general fund to the
commissioner of commerce to the solar for schools account established under Minnesota
Statutes, section 216C.375, subdivision 3.
new text end

new text begin (b) Of the amount transferred under paragraph (a), $110,000,000 is reserved for solar
for schools loans made under Minnesota Statutes, section 216C.375, subdivision 9b, and
$10,000,000 is reserved for curriculum support grants made under Minnesota Statutes,
section 216C.375, subdivision 9a.
new text end

Sec. 19. new text begin REPEALER.
new text end

new text begin Minnesota Statutes 2022, section 216C.376, subdivisions 2, 3, 4, 5, 6, 7, 8, and 9, new text end new text begin are
repealed.
new text end

APPENDIX

Repealed Minnesota Statutes: 23-03755

216C.376 SOLAR FOR SCHOOLS PROGRAM FOR CERTAIN UTILITY SERVICE TERRITORY.

Subd. 2.

Required plan.

(a) By October 1, 2021, the public utility must file a plan for the solar for schools program with the commissioner. The plan must contain but is not limited to the following elements:

(1) a description of how the public utility proposes to use incentive program money withheld from the renewable development account to provide financial assistance to schools at which a solar energy system is installed;

(2) an estimate of the amount of financial assistance that the public utility provides to a school under clause (1), and the length of time financial assistance is provided;

(3) administrative procedures governing the application and financial assistance award process, and the costs the public utility is projected to incur to administer the program;

(4) the public utility's proposed process for periodic reevaluation and modification of the program; and

(5) any additional information required by the commissioner.

(b) The public utility may not implement the program until the commissioner approves the public utility's plan submitted under this subdivision. The commissioner must approve a plan under this subdivision that the commissioner determines to be in the public interest no later than December 31, 2021. Any proposed modifications to the plan approved under this subdivision must be approved by the commissioner.

Subd. 3.

System eligibility.

A solar energy system is eligible to receive financial assistance under this section if it meets all of the following conditions:

(1) the solar energy system must be located on or adjacent to a school building receiving retail electric service from the public utility and completely located within the public utility's electric service territory, provided that any land situated between the school building and the site where the solar energy system is installed is owned by the school district or the state college or university in which the school building operates;

(2) the total aggregate nameplate capacity of all distributed generation serving the school building, including any subscriptions to a community solar garden under section 216B.1641, may not exceed the lesser of one megawatt alternating current or 120 percent of the average annual electric energy consumption of the school building; and

(3) has real-time and cumulative display devices, located in a prominent location accessible to students and the public, that indicate the system's electrical performance.

Subd. 4.

Application process.

(a) A school seeking financial assistance under this section must submit an application to the public utility, including a plan for how the school uses the solar energy system as a visible learning tool for students, teachers, and visitors to the school, and how the solar energy system may be integrated into the school's curriculum.

(b) The public utility must award financial assistance under this section on a first-come, first-served basis.

(c) The public utility must discontinue accepting applications under this section after all money withheld under subdivision 5 are allocated to program participants, including funds from canceled projects.

Subd. 5.

Program funding.

(a) In 2022, the public utility subject to section 116C.779 must withhold $8,000,000 from the transfer made under section 116C.779, subdivision 1, paragraph (e), to pay for assistance provided by the program under this section. The money withheld under this paragraph must be used to pay for financial assistance awarded under this section and the costs to administer this section. Any money that remains unexpended on June 30, 2027, cancels to the renewable development account.

(b) The renewable energy credits associated with the electricity generated by a solar energy system installed under this section are the property of the public utility that is subject to this section for the life of the system, regardless of the duration of the financial assistance provided by the public utility under this section.

Subd. 6.

Limitation.

(a) No more than 60 percent of the financial assistance provided by the public utility to schools under this section may be provided to schools where the proportion of students eligible for free and reduced-price lunch under the National School Lunch Program is less than 50 percent. If, after December 31, 2024, there is an insufficient number of applicant schools to fulfill the requirements of this paragraph, the remaining amounts may be provided to any school that is otherwise eligible to receive financial assistance under this section but for the requirements of this paragraph.

(b) No more than ten percent of the total amount of financial assistance provided by the public utility to schools under this section may be provided to schools that are part of the same school district or state college or university.

(c) Paragraph (a) does not apply to a state college or university.

Subd. 7.

Technical assistance.

The commissioner may provide technical assistance to schools to develop and execute projects under this section.

Subd. 8.

Program information.

The public utility must provide information requested by the commissioner that the commissioner determines is necessary to complete the report required under section 216C.375, subdivision 11.

Subd. 9.

Application deadline.

No application may be submitted under this section after December 31, 2025.