HF 1271

as introduced - 88th Legislature (2013 - 2014) Posted on 03/13/2013 11:36am

A bill for an act
relating to energy; modifying the way certain conservation investments are
counted toward a utility's conservation savings goal; setting a 2015 expiration date
for utility performance-based conservation savings goals; amending Minnesota
Statutes 2012, sections 216B.164, subdivision 3; 216B.241, subdivisions 1c, 2c.

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

Section 1.

Minnesota Statutes 2012, section 216B.164, subdivision 3, is amended to
read:

Subd. 3.

Purchases; small facilities.

(a) For a qualifying facility having less than
40-kilowatt capacity, the customer shall be billed for the net energy supplied by the utility
according to the applicable rate schedule for sales to that class of customer. In the case
of net input into the utility system by a qualifying facility having less than 40-kilowatt
capacity, compensation to the customer shall be at a per kilowatt-hour rate determined
under paragraph (b) deleted text begin or (c) deleted text end .

(b) In setting rates, the commission shall consider the fixed distribution costs to the
utility not otherwise accounted for in the basic monthly charge and shall ensure that the
costs charged to the qualifying facility are not discriminatory in relation to the costs
charged to other customers of the utility. The commission shall set the rates for net
input into the utility system based on avoided costs as defined in the Code of Federal
Regulations, title 18, section 292.101, paragraph (b)(6), the factors listed in Code of
Federal Regulations, title 18, section 292.304, and all other relevant factors.

(c) deleted text begin Notwithstanding any provision in this chapter to the contrary, a qualifying facility
having less than 40-kilowatt capacity may elect that the compensation for net input by
the qualifying facility into the utility system shall be at the average retail utility energy
rate. "Average retail utility energy rate" is defined as the average of the retail energy rates,
exclusive of special rates based on income, age, or energy conservation, according to the
applicable rate schedule of the utility for sales to that class of customer.
deleted text end

deleted text begin (d) deleted text end If the qualifying facility is interconnected with a nongenerating utility which has
a sole source contract with a municipal power agency or a generation and transmission
utility, the nongenerating utility may elect to treat its purchase of any net input under this
subdivision as being made on behalf of its supplier and shall be reimbursed by its supplier
for any additional costs incurred in making the purchase. Qualifying facilities having
less than 40-kilowatt capacity may, at the customer's option, elect to be governed by
the provisions of subdivision 4.

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.

Minnesota Statutes 2012, section 216B.241, subdivision 1c, is amended to read:

Subd. 1c.

Energy-saving goals.

(a) The commissioner shall establish energy-saving
goals for energy conservation improvement expenditures and shall evaluate an energy
conservation improvement program on how well it meets the goals set.

(b) Each individual utility and association shall have an annual energy-savings
goal equivalent to 1.5 percent of gross annual retail energy sales unless modified by the
commissioner under paragraph (d). The savings goals must be calculated based on the
most recent three-year weather-normalized average. A utility or association may elect to
carry forward energy savings in excess of 1.5 percent for a year to the succeeding three
calendar years, except that savings from electric utility infrastructure projects allowed
under paragraph (d) may be carried forward for five years. A particular energy savings can
be used only for one year's goal.

(c) The commissioner must adopt a filing schedule that is designed to have all
utilities and associations operating under an energy-savings plan by calendar year 2010.

(d) In its energy conservation improvement plan filing, a utility or association may
request the commissioner to adjust its annual energy-savings percentage goal based on
its historical conservation investment experience, customer class makeup, load growth, a
conservation potential study, or other factors the commissioner determines warrants an
adjustment. The commissioner may not approve a plan of a public utility that provides for
an annual energy-savings goal of less than one percent of gross annual retail energy sales
from energy conservation improvements.

A utility or association may include in its energy conservation plan energy savings
from electric utility infrastructure projects approved by the commission under section
216B.1636 or waste heat recovery converted into electricity projects that may count as
energy savings deleted text begin in addition to a minimum energy-savings goal of at least one percent for
energy conservation improvements deleted text end . Electric utility infrastructure projects must result in
increased energy efficiency greater than that which would have occurred through normal
maintenance activity.

(e) An energy-savings goal is not satisfied by attaining the revenue expenditure
requirements of subdivisions 1a and 1b, but can only be satisfied by meeting the
energy-savings goal established in this subdivision.

(f) An association or utility is not required to make energy conservation investments
to attain the energy-savings goals of this subdivision that are not cost-effective even
if the investment is necessary to attain the energy-savings goals. For the purpose of
this paragraph, in determining cost-effectiveness, the commissioner shall consider the
costs and benefits to ratepayers, the utility, participants, and society. In addition, the
commissioner shall consider the rate at which an association or municipal utility is
increasing its energy savings and its expenditures on energy conservation.

(g) On an annual basis, the commissioner shall produce and make publicly available
a report on the annual energy savings and estimated carbon dioxide reductions achieved
by the energy conservation improvement programs for the two most recent years for
which data is available. The commissioner shall report on program performance both in
the aggregate and for each entity filing an energy conservation improvement plan for
approval or review by the commissioner.

(h) By January 15, 2010, the commissioner shall report to the legislature whether
the spending requirements under subdivisions 1a and 1b are necessary to achieve the
energy-savings goals established in this subdivision.

new text begin (i) This subdivision expires December 31, 2015.
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

Sec. 3.

Minnesota Statutes 2012, section 216B.241, subdivision 2c, is amended to read:

Subd. 2c.

Performance incentives.

By December 31, 2008, the commission
shall review any incentive plan for energy conservation improvement it has approved
under section 216B.16, subdivision 6c deleted text begin , and adjust the utility performance incentives to
recognize making progress toward and meeting the energy-savings goals established
in subdivision 1c deleted text end .

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective January 1, 2016.
new text end