1.1A bill for an act1.2relating to energy; providing direction for use of federal stimulus funds for 1.3energy programs.1.4BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MINNESOTA:1.5ARTICLE 11.6DEFINITIONS; GOALS; LEGISLATIVE REVIEW1.7    Section 1. FEDERAL STIMULUS FUNDING; GOAL OF ENERGY 1.8PROGRAMS.1.9    Subdivision 1.Definitions.For the purposes of articles 1 to 5, the following terms 1.10have the meaning given them.1.11(a) "Act" means the American Recovery and Reinvestment Act of 2009.1.12(b) "Commissioner" means the commissioner of commerce.1.13(c) "Stimulus funding" or "funding" means funding provided to the state under 1.14the act for:1.15(1) energy efficiency and conservation block grants authorized under subtitle E of 1.16title V of the federal Energy Independence and Security Act of 2007, United States Code, 1.17title 42, section 17151 et seq.;1.18(2) the Weatherization Assistance Program authorized under part A of title IV of the 1.19federal Energy Conservation and Production Act, United States Code, title 42, section 1.206861, et seq.; and1.21(3) the State Energy Program authorized under part D of title III of the federal 1.22Energy Policy and Conservation Act, United States Code, title 42, section 6321, et seq.1.23    Subd. 2.Stimulus funding allocation and use goals.To the extent allowed by 1.24federal law and regulation and consistent with the purposes and principles of the act, 2.1stimulus funding must be allocated and expended under articles 2 to 4 for activities that 2.2best achieve the following goals:2.3(1) job retention and creation;2.4(2) improved energy efficiency and increased renewable energy production capacity;2.5(3) coordination with and leveraging of other resources to increase the total benefits 2.6derived from stimulus funding;2.7(4) timely implementation of funded activities;2.8(5) long-term sustainability of benefits derived from stimulus funds;2.9(6) geographic distribution across the state; 2.10(7) compliance with the disadvantaged business enterprise requirements in 2.11Minnesota Statutes, section 16C.16; and2.12(8) ensuring that projects are cost-effective and maximize energy savings per dollar 2.13of stimulus funding expended.2.14EFFECTIVE DATE.This section is effective the day following final enactment.2.15    Sec. 2. LEGISLATIVE REVIEW.2.16The Office of Energy Security shall, prior to expending any stimulus funds, submit 2.17to the chairs and ranking minority members of the senate and house of representatives 2.18committees with primary jurisdiction over energy policy and finance the criteria it 2.19proposes to use to rank the programs in articles 1 to 5 in order to allocate stimulus funding 2.20among the programs. Comments on the proposed criteria must be submitted to the Office 2.21of Energy Security within ten working days of receipt of the criteria. The Office of Energy 2.22Security shall consider the comments before establishing the final allocation criteria, and 2.23shall submit a report on the amount of stimulus funds allocated to each of the programs 2.24under articles 1 to 5 the chairs and ranking minority members of the senate and house of 2.25representatives committees with primary jurisdiction over energy policy and finance 2.26within ten working days of establishing the stimulus funding allocations.2.27EFFECTIVE DATE.This section is effective the day following final enactment.2.28ARTICLE 22.29ENERGY EFFICIENCY2.30    Section 1. WEATHERIZATION.2.31    Subdivision 1.Allocation of funds.All stimulus funds for weatherization must be 2.32allocated by the director of the Office of Energy Security, consistent with federal allocation 2.33requirements and state allocation formulas in the state weatherization plan. Existing 3.1providers of weatherization services must be fully utilized, consistent with effective 3.2program delivery, before additional providers of weatherization services are added.3.3    Subd. 2.Rental units. Programs that include rental units must be developed, 3.4including developing procedures to increase low-income rental unit participation in 3.5programs. Priority must be given to serving the largest number of new weatherization 3.6clients consistent with federal eligibility requirements.3.7    Subd. 3.Background check.Any person offering employment to an individual 3.8to conduct weatherization activities under this section shall request a criminal history 3.9background check from the superintendent of the Bureau of Criminal Apprehension on that 3.10individual. In order for an individual to be eligible for employment, the individual must 3.11provide an executed criminal history consent form and a money order or check payable to 3.12the Bureau of Criminal Apprehension in an amount equal to the actual cost to the Bureau 3.13of Criminal Apprehension of conducting the background check. The superintendent of 3.14the Bureau of Criminal Apprehension shall conduct the background check by retrieving 3.15criminal history data maintained in the criminal justice information system computers.3.16    Subd. 4.Employment prohibited.An individual convicted of a violent crime, as 3.17defined in Minnesota Statutes, section 611A.08, subdivision 6, or a crime against property 3.18may not be hired to conduct weatherization activities under this section.3.19EFFECTIVE DATE.This section is effective the day following final enactment.3.20    Sec. 2. LOCAL GOVERNMENT AND SCHOOL DISTRICT BUILDING 3.21RENOVATIONS.3.22The Office of Energy Security must coordinate the use of stimulus funds with the 3.23local public building enhanced energy-efficiency program under Minnesota Statutes, 3.24section 216C.43. The Office of Energy Security shall prioritize lighting upgrades, energy 3.25recommissioning, and other cost-effective energy projects that are ready for immediate 3.26implementation. Stimulus funds may be used for, but are not limited to, grants for a portion 3.27of costs incurred by local governments to implement energy efficiency improvements 3.28under the local public building enhanced energy-efficiency program.  The Office of Energy 3.29Security may require a local government, as a condition of receiving a grant, to commit to 3.30implement future activities, including, but not limited to, staff training, that are designed 3.31to create additional energy or operating savings to the local government.  The Office of 3.32Energy Security shall coordinate with the Department of Education to prioritize school 3.33district projects for funding under this section, consistent with the principles of statewide 3.34geographic distribution of projects, optimized energy savings, and an improved learning 3.35environment for schoolchildren.4.1EFFECTIVE DATE.This section is effective the day following final enactment.4.2    Sec. 3. STATE GOVERNMENT BUILDINGS.4.3The Department of Administration shall develop a plan and procedures to select, 4.4fund, and implement projects using stimulus funds. The plan and procedures shall 4.5prioritize lighting upgrades, energy-efficient windows, energy recommissioning, and other 4.6cost-effective energy projects that are ready for immediate implementation. Funds may be 4.7used for, but are not limited to, grants for a portion of costs incurred by state agencies in 4.8implementing energy efficiency improvements.  The Department of Administration may 4.9require a state agency, as a condition of receiving stimulus funds, to commit to implement 4.10future activities, including, but not limited to, staff training, that are designed to create 4.11additional energy or operating savings to the state agency.4.12EFFECTIVE DATE.This section is effective the day following final enactment.4.13    Sec. 4. RESIDENTIAL ENERGY EFFICIENCY PROGRAMS.4.14The Office of Energy Security shall coordinate with the Minnesota Housing Finance 4.15Agency to use stimulus funds in conjunction with the Minnesota Housing Finance 4.16Agency's existing financing programs to improve energy efficiency in dwellings, including 4.17energy efficient windows.4.18EFFECTIVE DATE.This section is effective the day following final enactment.4.19    Sec. 5. TRAINING AND WORKFORCE DEVELOPMENT.4.20(a) The Department of Employment and Economic Development, in consultation 4.21with the Office of Energy Security and the Office of Higher Education, shall develop a 4.22plan and procedures to:4.23(1) allocate stimulus funds to training programs to train energy professionals needed 4.24to implement the energy programs described in sections 1 to 4, including but not limited to 4.25energy auditors, energy managers, and building operators;4.26(2) coordinate, oversee, and monitor the training and certification of energy 4.27professionals; and4.28(3) allocate stimulus funding for the purposes of clauses (1) and (2) and to training 4.29providers.4.30(b) Training strategies must be designed to meet the wide range of facilities 4.31managers and building sizes and types, and must protect the occupational health and safety 5.1of workers employed on these energy projects. Technical skills training must include 5.2insulation, air sealing, and mechanical work.5.3(c) The plan must include procedures to:5.4(1) train individuals already employed in implementing energy programs;5.5(2) recruit individuals to be trained to perform work in energy projects using 5.6stimulus funding who are unemployed, especially targeting communities experiencing 5.7disproportionately high rates of unemployment, including, but not limited to, low-income, 5.8youth, rural, or tribal communities and individuals in construction trades and crafts;5.9(3) ensure that the full capacity of current training providers is utilized, including, 5.10but not limited to, opportunities industrialization centers, skilled trades labor unions, tribal 5.11colleges or nonprofits working in tribal communities, community action partnerships, 5.12utility companies, higher education institutions, and nonprofit organizations with 5.13demonstrated expertise in energy efficiency; and5.14(4) publicize job and contract opportunities through cost-effective dissemination 5.15via the mass media, including, but not limited to, public service announcements and 5.16radio advertisements.5.17EFFECTIVE DATE.This section is effective the day following final enactment.5.18    Sec. 6. ACCOUNTABILITY AND TRANSPARENCY REPORTING.5.19The director of the Office of Energy Security, after compiling information supplied 5.20by the Departments of Administration, Education, and Employment and Economic 5.21Development, and the Office of Higher Education, shall report on the progress of the 5.22programs funded under articles 1 to 5 to the house of representatives and senate committees 5.23with jurisdiction over energy finance and workforce development policy by September 1, 5.242009, January 15, 2010, April 1, 2010, and September 1, 2010. The report must include a 5.25complete accounting of all stimulus funds spent on the programs funded under articles 1 to 5.265, to the extent allowable by state and federal law, including, but not limited to:5.27(1) the specific projects funded, including the location, building owner, and project 5.28manager;5.29(2) the number of jobs retained or created by each project;5.30(3) the total calculated and actual energy savings for each project;5.31(4) the remaining balances in each stimulus fund;5.32(5) the nonstimulus funding leveraged by stimulus funds for each project;5.33(6) the training courses provided, including the location and provider of courses 5.34offered, the funding source for each training course, and the total number of trainees; 6.1(7) compliance with prevailing wage, veterans, and disadvantaged business 6.2enterprise requirements; and6.3(8) the effectiveness of the outreach and recruitment efforts among youth, 6.4low-income, and unemployed workers conducted under section 5, paragraph (a), clause 6.5(2).6.6EFFECTIVE DATE.This section is effective the day following final enactment.6.7ARTICLE 36.8RENEWABLE ENERGY6.9    Section 1. RENEWABLE ENERGY GRANT PROGRAM.6.10(a) The commissioner of commerce shall establish a program to award grants to 6.11energy projects that meet the following conditions:6.12(1) the project qualifies as a community-based energy development (C-BED) project, 6.13as defined in Minnesota Statutes, section 216B.1612, subdivision 2, paragraph (g);6.14(2) for wind projects, the project is located in an area where the measured wind 6.15resource is Class 4 or above;6.16(3) the project begins commercial operation after July 1, 2009;6.17(4) the project does not receive renewable energy payment incentives under 6.18Minnesota Statutes, section 216C.41; and6.19(5) the project meets any other conditions established under the American Recovery 6.20and Reinvestment Act of 2009, Public Law 111-5, for use of these funds.6.21(b) The department shall develop an application form, application review procedures, 6.22criteria that projects must meet in order to be considered for a grant award, procedures 6.23and guidelines for project monitoring and evaluation, and other administrative procedures 6.24necessary to fully implement a grant program.6.25(c) The maximum grant to a project is $500,000.6.26(d) No more than two projects in a single county may receive a grant under this 6.27section.6.28(e) No C-BED qualifying owner may financially participate in more than one project 6.29that receives a grant under this section.6.30(f) Grant awards must be geographically dispersed throughout the state.6.31EFFECTIVE DATE.This section is effective the day following final enactment.6.32    Sec. 2. RENEWABLE ELECTRIC GENERATION FACILITY REBATES.7.1(a) The commissioner shall establish a program to award rebates to qualifying 7.2facilities that generate electricity from a renewable source and that:7.3(1) begin operation after July 1, 2009; 7.4(2) meet all other conditions established under the act; and7.5(3) provide electricity to:7.6(i) a homeowner's primary residence; or7.7(ii) a business with 20 or fewer full-time employees.7.8(b) The commissioner shall develop an application form, application review 7.9procedures, criteria that projects must meet in order to be considered for a rebate, 7.10procedures and guidelines for project monitoring and evaluation, and other administrative 7.11procedures necessary to fully implement a rebate program.7.12(c) The owner of a qualifying facility may apply to the commissioner for a rebate of 7.13the lesser of $2,500 or 35 percent of the cost of the electric generation facility, including 7.14installation costs.7.15(d) The commissioner shall award rebates only from funds appropriated for that 7.16purpose and to the extent of those appropriations. Grants must be made to applicants in 7.17the order of the time of receipt of a complete application.7.18(e) For purposes of this section:7.19(1) "Qualifying facility" means an electric generation facility with a capacity of less 7.20than 40 kilowatts that generates electricity from a renewable energy source.7.21(2) "Renewable energy source" means:7.22(i) solar;7.23(ii) wind;7.24(iii) hydroelectric;7.25(iv) hydrogen, provided that after January 1, 2010, the hydrogen must be generated 7.26from the resources listed in this clause; or7.27(v) biomass, which includes, without limitation, landfill gas; an anaerobic digester 7.28system; and the predominantly organic components of wastewater effluent, sludge, or 7.29related by-products from publicly owned treatment works, but not including incineration 7.30of wastewater sludge to produce electricity.7.31(3) "Commissioner" means the commissioner of commerce.7.32EFFECTIVE DATE.This section is effective the day following final enactment.7.33    Sec. 3. SOLAR ENERGY PROJECTS IN PUBLIC BUILDINGS AND 7.34SCHOOLS.7.35(a) The commissioner shall establish a program to award grants to:8.1(1) local units of government to pay the costs of installing solar energy projects to 8.2generate energy used in public buildings; or8.3(2) to school districts to pay the costs of installing solar energy projects to generate 8.4energy used in K-12 schools.8.5(b) To be eligible to receive a grant, a project must:8.6(1) begin operation after July 1, 2009; and8.7(2) meet all other conditions established under the act.8.8(c) The commissioner shall develop an application form, application review 8.9procedures, criteria that a project must meet in order to be considered for a grant award, 8.10procedures and guidelines for project monitoring and evaluation, and other administrative 8.11procedures necessary to fully implement a grant program.8.12(d) In awarding grants, the commissioner must determine, at a minimum, the 8.13following:8.14(1) that the physical condition of the building is sufficient to support the efficient 8.15operation of the solar energy project;8.16(2) that there is no significant possibility that the building may close within ten 8.17years, which determination, for a school, must be based on enrollment projections; and8.18(3) that the projected cumulative energy savings exceed the grant amount within 15 8.19years for a qualifying solar thermal project, and within 20 years for a photovoltaic device.8.20(e) In awarding grants, the commissioner must also consider:8.21(1) the reliability and cost-effectiveness of the solar technology to be installed;8.22(2) the extent to which the proposal effectively coordinates with the conservation 8.23and energy efficiency programs offered by the energy utilities serving the building in 8.24which the project is located, and with the public building enhanced energy efficiency 8.25program under section 216C.43, if applicable;8.26(3) life cycle energy use reductions and greenhouse gas emissions reductions 8.27projected per dollar of installed cost of the project; and8.28(4) the geographic distribution of grant recipients throughout the state.8.29(f) For the purposes of this section:8.30(1) "public building" means any publicly owned building, sports arena, or other 8.31facility of a county, city, or other local unit of government;8.32(2)  "solar energy" means:8.33(i) a photovoltaic device, as defined in Minnesota Statutes, section 216C.06, 8.34subdivision 16; or9.1(ii) a qualifying thermal project, as defined in Minnesota Statutes, section 9.2216B.2411, subdivision 2, that includes modifications made to a distribution system to 9.3distribute heating or cooling throughout a building; and9.4(3) "commissioner" means the commissioner of commerce.9.5EFFECTIVE DATE.This section is effective the day following final enactment.9.6ARTICLE 49.7MISCELLANEOUS PROGRAMS 9.8    Section 1. ENERGY PROGRAMS IN COMMERCIAL AND INDUSTRIAL 9.9BUILDINGS.9.10(a) The commissioner of commerce shall establish a program to award grants to 9.11commercial and industrial facilities for the purpose of:9.12(1) installing energy-efficiency improvements or devices that use renewable energy 9.13sources to generate electricity or to heat or cool a building; or 9.14(2) manufacturing renewable fuels in solid form from biomass for use in industrial 9.15boilers. 9.16(b) To be eligible to receive a grant, a project must:9.17(1) begin commercial operation after July 1, 2009; and9.18(2) meet all other conditions established under the act.9.19(c) The commissioner shall develop an application form, application review 9.20procedures, criteria that a project must meet in order to be considered for a grant award, 9.21procedures and guidelines for project monitoring and evaluation, and other administrative 9.22procedures necessary to fully implement a grant program.9.23(d) For the purposes of this section, "renewable energy source" means:9.24(i) solar;9.25(ii) wind;9.26(iii) hydroelectric;9.27(iv) hydrogen, provided that after January 1, 2010, the hydrogen must be generated 9.28from the resources listed in this paragraph; or9.29(v) biomass, which includes, without limitation, rotating woody crops; landfill gas; 9.30an anaerobic digester system; and the predominantly organic components of wastewater 9.31effluent, sludge, or related by-products from publicly owned treatment works, but not 9.32including incineration of wastewater sludge to produce electricity.9.33EFFECTIVE DATE.This section is effective the day following final enactment.10.1    Sec. 2. ENERGY EDUCATION, TRAINING, AND DATA SYSTEMS.10.2The Office of Energy Security shall establish programs to work with teachers and 10.3other energy experts to include energy issues in K-12 curricula; develop training and 10.4certification programs for technicians to install and service wind and solar energy systems; 10.5and upgrade data systems to enable accurate tracking of energy savings resulting from the 10.6conservation improvement program and other state energy programs.10.7EFFECTIVE DATE.This section is effective the day following final enactment.10.8    Sec. 3. ENERGY EFFICIENCY GRANTS TO LOCAL GOVERNMENTS.10.9The Office of Energy Security shall establish a grant program to award grants to 10.10local units of government to enhance energy efficiency and reduce energy use. Energy 10.11efficiency and conservation block grant funds may be used for grants for planning, 10.12consultant services, energy audits, implementing energy-efficient building codes and 10.13inspection services, energy efficiency renovations, street lighting, and the installation of 10.14renewable energy devices deployed on public buildings.10.15ARTICLE 510.16APPROPRIATIONS10.17    Section 1. WEATHERIZATION ASSISTANCE PROGRAM APPROPRIATION.10.18Of the funds available to the state of Minnesota from the federal stimulus funding for 10.19the weatherization assistance program under the American Recovery and Reinvestment 10.20Act of 2009, Public Law 111-5, $131,937,411 is appropriated to the commissioner of 10.21commerce. The funds must be administered consistent with the requirements in article 2, 10.22section 1.10.23    Sec. 2. ENERGY EFFICIENCY AND CONSERVATION BLOCK PROGRAM 10.24APPROPRIATION.10.25The funds available to the state of Minnesota from the federal stimulus funding 10.26for the Energy Efficiency and Conservation Block Grant Program under the American 10.27Recovery and Reinvestment Act of 2009, Public Law 111-5, estimated to be $10,644,100, 10.28are appropriated to the commissioner of commerce. The appropriation must be distributed 10.29as follows:10.30(1) 61.5 percent, estimated to be $6,546,121, is for energy efficiency grants to local 10.31government in article 4, section 3; and11.1(2) 38.5 percent, estimated to be $4,097,979, is for local government and school 11.2district buildings consistent with the requirements in article 2, section 2.11.3EFFECTIVE DATE.This section is effective the day following final enactment.11.4    Sec. 3. STATE ENERGY PROGRAM APPROPRIATION.11.5Of the funds available to the state of Minnesota from the federal stimulus funding 11.6for the State Energy Program under the American Recovery and Reinvestment Act of 11.72009, Public Law 111-5, $54,172,000 is appropriated to the commissioner of commerce. 11.8Of this amount:11.9(1) $10,650,000 is for local government and school district buildings consistent 11.10with the requirements in article 2, section 2;11.11(2) $8,000,000 is for state government buildings consistent with the requirements in 11.12article 2, section 3;11.13(3) $12,000,000 is for the residential energy financing programs in article 2, section 11.144;11.15(4) $12,000,000 is for renewable energy programs, including, but not limited to, the 11.16programs specified in article 3;11.17(5) $5,000,000 is for grants to commercial and industrial facilities for energy 11.18efficiency and renewable energy projects in article 4, section 1;11.19(6) $5,022,000 is for energy education, training, and information and data systems in 11.20article 4, section 2; and11.21(7) $1,500,000 is for a grant to the Board of Trustees of the Minnesota State Colleges 11.22and Universities for the International Renewable Energy Technology Institute (IRETI) to 11.23be located at Minnesota State University, Mankato, as a public and private partnership to 11.24support applied research in renewable energy and energy efficiency to aid in the transfer of 11.25technology from Sweden to Minnesota and to support technology commercialization from 11.26companies located in Minnesota and throughout the world.11.27EFFECTIVE DATE.This section is effective the day following final enactment.