HF 2375

as introduced - 88th Legislature (2013 - 2014) Posted on 02/27/2014 03:15pm

A bill for an act
relating to energy; utilities; authorizing a bill for gas or electric services to
include charges for certain conservation improvements; requiring a Sustainable
Building 2030 incentive rate; requiring industrial energy efficiency plans to meet
forecasted electric generation capacity needs; amending Minnesota Statutes 2012,
sections 216B.241, by adding a subdivision; 216B.2422, subdivision 2, by adding
a subdivision; proposing coding for new law in Minnesota Statutes, chapter 216B.

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

Section 1.

new text begin [216B.1631] SUSTAINABLE BUILDING 2030 INCENTIVE RATES.
new text end

new text begin (a) The commissioner may require a public utility, as part of its obligation under
section 216B.241, subdivision 9, paragraph (e), to file a tariff with the commission
providing special rates for commercial, industrial, and institutional customers for a
building that is newly constructed or substantially reconstructed to meet the Sustainable
Building 2030 energy efficiency performance standards scheduled to become effective in
2015 under section 216B.241, subdivision 9. The commission shall approve a Sustainable
Building 2030 incentive rates tariff if the commission finds the proposal:
new text end

new text begin (1) encourages energy conservation and otherwise satisfies the requirements of
section 216B.03;
new text end

new text begin (2) requires customers to apply for the incentive rates prior to completion of
construction or reconstruction and provides evidence that the 2015 energy efficiency
performance standards will be met;
new text end

new text begin (3) requires the public utility to establish procedures to verify that a building meets
the 2015 energy efficiency performance standards while it is charged the Sustainable
Building 2030 incentive rates;
new text end

new text begin (4) provides incentive rates that are discounted from the public utility's standard
tariffed rates and fees;
new text end

new text begin (5) limits incentive rates for a building to a term not exceeding ten consecutive years;
new text end

new text begin (6) sets the incentive rates at a level sufficient to cover the public utility's incremental
cost of providing service to the customer;
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new text begin (7) allows the public utility to seek recovery of the difference in revenue collected
under the incentive rates and what would have been collected under the utility's standard
tariffed rates, except that the utility may not recover the difference from residential
customers; and
new text end

new text begin (8) is consistent with the public interest.
new text end

new text begin (b) The commission may approve, disapprove, or modify a proposed incentive
rate filed under this section. A large customer facility, as that term is defined in section
216B.241, subdivision 1, that has been exempted from the investment and expenditure
requirements of section 216B.241, subdivision 1a, paragraph (a), is not eligible for an
incentive rate under this section.
new text end

new text begin (c) A public utility may count the incremental savings associated with the energy
conservation improvements incented by the rate discount under this section toward
satisfying its energy-savings goals under section 216B.241, subdivision 1c.
new text end

Sec. 2.

Minnesota Statutes 2012, section 216B.241, is amended by adding a
subdivision to read:

new text begin Subd. 5d. new text end

new text begin On-bill loan repayment programs. new text end

new text begin (a) For the purposes of this
subdivision, "utility" means a public utility, municipal utility, or cooperative electric
association that provides electric or natural gas service to retail customers.
new text end

new text begin (b) A utility may include as part of its conservation improvement plan an on-bill
loan repayment program for a customer to finance eligible projects with installment
loans originated by an eligible lender. An eligible project is one that is either an energy
conservation improvement, or a project that uses an eligible renewable energy source as
that term is defined in section 216B.2411, subdivision 2, paragraph (b), but does not
include mixed municipal solid waste or refuse-derived fuel from mixed municipal solid
waste. To be an eligible lender, a lender must have a federal or state charter and be eligible
for federal deposit insurance. The commissioner must allow a utility broad discretion in
the design and implementation of an on-bill loan repayment program, provided that the
program complies with this subdivision.
new text end

new text begin (c) A utility may establish an on-bill loan repayment program for all customer
classes or for a specific customer class.
new text end

new text begin (d) A utility that implements an on-bill repayment program under this section
must contract with one or more eligible lenders for program capital commitments, loan
origination, transfer of loans to the utility for on-bill loan repayment, and acceptance of
loans returned due to delinquency or default.
new text end

new text begin (e) A utility's contract with a lender must require the lender to comply with all
applicable federal and state laws, rules, and regulations related to lending practices and
consumer protection, and to conform to reasonable and prudent lending standards.
new text end

new text begin (f) A utility's contract with a lender may provide:
new text end

new text begin (1) for the utility to purchase loans from the lender with a condition that the lender
must purchase back loans in delinquency or default; or
new text end

new text begin (2) provide for the lender to retain ownership of loans with the utility servicing the
loans through on-bill repayment as long as payments are current.
new text end

new text begin The risk of default must remain with the lender. The lender shall not have recourse against
the utility except in the event of negligence or breach of contract by the utility.
new text end

new text begin (g) If a utility customer makes a partial payment on a utility bill that includes a loan
installment, the partial payment must be credited first to the amount owed for utility
service, including taxes and fees. A utility may not suspend or terminate a customer's
utility service for delinquency or default on a loan that is being serviced through the
utility's on-bill loan repayment program.
new text end

new text begin (h) An outstanding balance is not a financial obligation of the next customer to
occupy the premises associated with that utility account. The utility must return to the
lender a loan not repaid when a customer borrower no longer occupies the premises.
new text end

new text begin (i) The commission may approve recovery under section 216B.16, subdivision 6b,
paragraph (c), of reasonable costs for billing system modifications necessary to implement
and operate an on-bill loan repayment program and for ongoing costs to operate the
program. Approved costs may be counted toward a utility's conservation spending
requirements under subdivisions 1a and 1b. Energy savings from energy conservation
improvements resulting from this section may be counted toward satisfying a utility's
energy-savings goals under subdivision 1c.
new text end

new text begin (j) This subdivision does not require a utility to terminate or modify an existing
financing program and does not prohibit a utility from establishing an on-bill financing
program in which the utility provides the financing capital.
new text end

Sec. 3.

Minnesota Statutes 2012, section 216B.2422, subdivision 2, is amended to read:

Subd. 2.

Resource plan filing and approval.

new text begin (a) new text end A utility shall file a resource plan
with the commission periodically in accordance with rules adopted by the commission.
The commission shall approve, reject, or modify the plan of a public utility, as defined in
section 216B.02, subdivision 4, consistent with the public interest. In the resource plan
proceedings of all other utilities, the commission's order shall be advisory and the order's
findings and conclusions shall constitute prima facie evidence which may be rebutted
by substantial evidence in all other proceedings. With respect to utilities other than
those defined in section 216B.02, subdivision 4, the commission shall consider the filing
requirements and decisions in any comparable proceedings in another jurisdiction.

new text begin (b) new text end As a part of its resource plan filing, a utility shall include new text begin :
new text end

new text begin (1) new text end the least cost plan for meeting 50 and 75 percent of all new and refurbished
capacity needs through a combination of conservation and renewable energy resources deleted text begin . deleted text end new text begin ; and
new text end

new text begin (2) an analysis of the cost and technical barriers to the utility continuing to make
progress on its system toward achieving the state greenhouse gas emission reduction goals
established in section 216H.02, subdivision 1, and the technologies, alternatives, and steps
the utility is considering to address those barriers.
new text end

Sec. 4.

Minnesota Statutes 2012, section 216B.2422, is amended by adding a
subdivision to read:

new text begin Subd. 2c. new text end

new text begin Resource acquisition; combined heat and power. new text end

new text begin (a) A utility that has a
forecasted need for capacity greater than 25 megawatts within five years from the date of
approval or acceptance of its most recent resource plan under subdivision 2 must:
new text end

new text begin (1) notify the industrial customers of the utility, or of the distribution utility to which
the utility provides wholesale electric service, that the utility is interested in industrial
combined heat and power projects of greater than 60 percent total system efficiency;
new text end

new text begin (2) evaluate proposals submitted by industrial customers along with supply
alternatives being considered by the utility to meet the forecasted need; and
new text end

new text begin (3) acquire the least cost resource or combination of resources available to the utility.
new text end

new text begin (b) The utility must demonstrate compliance with this subdivision in its next filing
under this section or in its next filing under section 216B.243, whichever comes first. A
utility may elect to satisfy this subdivision by filing and receiving commission approval
of a standard offer tariff to acquire industrial combined heat and power installations of
greater than 60 percent total system efficiency.
new text end