HF 812

as introduced - 87th Legislature (2011 - 2012) Posted on 03/03/2011 10:57am

A bill for an act
relating to energy; amending definition of community-based energy development
project; amending Minnesota Statutes 2010, section 216B.1612, subdivision 2.

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

Section 1.

Minnesota Statutes 2010, section 216B.1612, subdivision 2, is amended to
read:

Subd. 2.

Definitions.

(a) The terms used in this section have the meanings given
them in this subdivision.

(b) "C-BED tariff" or "tariff" means a community-based energy development tariff.

(c) "Qualifying beneficiary" means:

(1) a Minnesota resident individually or as a member of a Minnesota limited liability
company organized under chapter 322B and formed for the purpose of developing a
C-BED project;

(2) a Minnesota nonprofit organization organized under chapter 317A;

(3) a Minnesota cooperative association organized under chapter 308A or 308B,
including a rural electric cooperative association or a generation and transmission
cooperative on behalf of and at the request of a member distribution utility;

(4) a Minnesota political subdivision or local government including, but not limited
to, a municipal electric utility, or a municipal power agency on behalf of and at the request
of a member distribution utility; the office of the commissioner of Iron Range resources
and rehabilitation; a county, statutory or home rule charter city, town, school district, or
public or private higher education institution; or any other local or regional governmental
organization such as a board, commission, or association;

(5) a tribal council; or

(6) a legal entity (i) formed for a purpose other than to participate in C-BED
projects; (ii) whose principal place of business or principal executive office is located
in Minnesota; and (iii) that provides labor, services, equipment, components, or debt
financing to a C-BED project.

A public utility, as defined in section 216B.02, subdivision 4, is not a qualifying
beneficiary.

(d) "Qualifying revenue" includes, but is not limited to:

(1) royalties, distributions, dividends, and other payments flowing directly or
indirectly to individuals who are qualifying beneficiaries;

(2) reasonable fees for consulting, development, professional, construction, and
operations and maintenance services paid to qualifying beneficiaries;

(3) interest and fees paid to financial institutions that are qualifying beneficiaries;

(4) the value-added portion of payments for goods manufactured in Minnesota; and

(5) production taxes.

(e) "Discount rate" means the ten-year United States Treasury Yield as quoted in
the Wall Street Journal as of the date of application for determination under subdivision
10, plus five percent; except that the discount rate applicable to any qualifying revenues
contingent upon an equity investor earning a specified internal rate of return is the ten-year
United States Treasury Yield, plus eight percent.

(f) "Standard reliability criteria" means:

(1) can be safely integrated into and operated within the utility's grid without causing
any adverse or unsafe consequences; and

(2) is consistent with the utility's resource needs as identified in its most recent
resource plan submitted under section 216B.2422.

(g) "Renewable" refers to a technology listed in section 216B.1691, subdivision 1,
paragraph (a).

(h) "Community-based energy development project" or "C-BED project" means a
new renewable energy project that either as a stand-alone project or part of a partnership
under subdivision 8:

(1) has no single qualifying beneficiary, including any parent company or subsidiary
of the qualifying beneficiary, owning more than 15 percent of a C-BED wind energy
project unless: (i) the C-BED wind energy project consists of only one or two turbines; or
(ii) the qualifying beneficiary is a public entity listed under paragraph (c), clause (4);

(2) demonstrates that at least 51 percent of the net present value of the gross revenues
from a power purchase agreement over the life of the project are qualifying revenues; deleted text begin and
deleted text end

(3) has a resolution of support adopted by the county board of each county in which
the project is to be located, or in the case of a project located within the boundaries of
a reservation, the tribal council for that reservation new text begin ; and
new text end

new text begin (4) has a nameplate capacity of 25 megawatts or less new text end .

(i) "Value-added portion" means the difference between the total sales price and the
total cost of components, materials, and services purchased from or provided outside
of Minnesota.

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective the day following final enactment
and applies to C-BED projects that file an application with the commissioner of commerce
for a predetermination or determination of C-BED eligibility after that date.
new text end