HF 4393

as introduced - 92nd Legislature (2021 - 2022) Posted on 03/17/2022 02:21pm

A bill for an act
relating to energy; directing the Public Utilities Commission to issue an order;
requiring utilities to install an energy storage system under certain conditions;
directing public utilities to file a tariff with the Public Utilities Commission;
requiring the Public Utilities Commission to order the installation of energy storage
systems; requiring public utilities to file a plan to install energy storage systems;
establishing an incentive program to install energy storage systems; appropriating
money; amending Minnesota Statutes 2020, sections 216B.1611, by adding a
subdivision; 216B.2422, by adding a subdivision; proposing coding for new law
in Minnesota Statutes, chapters 216B; 216C.

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

Section 1.

Minnesota Statutes 2020, section 216B.1611, is amended by adding a subdivision
to read:

new text begin Subd. 5. new text end

new text begin Energy storage; capacity; treatment. new text end

new text begin No later than November 1, 2022, the
commission must issue an order clarifying that for the purpose of interconnecting an on-site
customer-owned distributed generation facility that operates in conjunction with an on-site
customer-owned energy storage system, as defined in section 216B.2422, subdivision 1,
paragraph (f), the system capacity must be calculated as including only the alternating
current capacity of the distributed generation facility.
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. 2.

new text begin [216B.1615] FEEDER LINE REPLACEMENT; STORAGE REQUIREMENT.
new text end

new text begin (a) When replacing a feeder line with a feeder line of higher capacity, an electric utility
must install at the applicable distribution substation an energy storage system that is of
sufficient capacity to insure customer safety and grid reliability.
new text end

new text begin (b) For the purposes of this section:
new text end

new text begin (1) "energy storage system" has the meaning given in section 216B.2422, subdivision
1, paragraph (f); and
new text end

new text begin (2) "feeder line" means a powerline (i) that transfers power from a distribution system
substation to distribution transformers, and (ii) whose current flow is the same at the sending
and receiving end of the powerline.
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.

new text begin [216B.1616] ENERGY STORAGE; PEAK SHAVING TARIFF.
new text end

new text begin (a) No later than September 15, 2022, the commission must initiate a docket designed
to result in a commission order requiring public utilities providing electric service to file a
tariff with the commission, based on guidelines established in the order, to compensate
customer-owners of on-site energy storage systems, as defined in section 216B.2422,
subdivision 1, paragraph (f), for the discharge of stored energy that is net input to the utility
during periods of peak electricity demand by utility customers.
new text end

new text begin (b) Within 90 days of the date the commission issues an order under this subdivision,
each public utility must file with the commission for commission approval, disapproval, or
modification a tariff that is consistent with the order.
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. 4.

Minnesota Statutes 2020, section 216B.2422, is amended by adding a subdivision
to read:

new text begin Subd. 8. new text end

new text begin Energy storage systems; installation. new text end

new text begin The commission must, as part of an
order regarding a public utility's integrated resource plan filed under this section, require a
public utility to install one or more energy storage systems, provided that the commission
finds the investments are reasonable, prudent, and in the public interest. When determining
the aggregate capacity of the energy storage systems ordered under this subdivision, the
commission must consider the public utility's assessment of energy storage systems contained
in the public utility's integrated resource plan, as required under subdivision 7.
new text end

new text begin EFFECTIVE DATE; APPLICATION. new text end

new text begin This section is effective the day following
final enactment and applies to any order issued to a public utility by the commission in an
integrated resource plan proceeding after July 1, 2022.
new text end

Sec. 5.

new text begin [216B.2429] ENERGY STORAGE SYSTEM; APPLICATION.
new text end

new text begin Subdivision 1. new text end

new text begin Definition. new text end

new text begin For the purposes of this section, "energy storage system" has
the meaning given in section 216B.2422, subdivision 1, paragraph (f).
new text end

new text begin Subd. 2. new text end

new text begin Application requirement. new text end

new text begin No later than one year following the date of the
commission's order to a public utility in an integrated resource plan proceeding under section
216B.2422, the public utility must submit an application to the commission for review and
approval to install one or more energy storage systems whose aggregate capacity meets or
exceeds that ordered by the commission in the public utility's most recent integrated resource
plan proceeding under section 216B.2422, subdivision 8.
new text end

new text begin Subd. 3. new text end

new text begin Application contents. new text end

new text begin (a) Each application submitted under this section must
contain:
new text end

new text begin (1) the energy storage system's technical specifications, including but not limited to:
new text end

new text begin (i) the maximum amount of electric output that the energy storage system can provide;
new text end

new text begin (ii) the length of time the energy storage system can sustain maximum output;
new text end

new text begin (iii) the location of the project within the utility's distribution system and a description
of the analysis conducted to determine the location;
new text end

new text begin (iv) a description of the public utility's electric system needs that the proposed energy
storage system addresses;
new text end

new text begin (v) a description of the types of services the energy storage system is expected to provide;
and
new text end

new text begin (vi) a description of the technology required to construct, operate, and maintain the
energy storage system, including any data or communication system necessary to operate
the energy storage system;
new text end

new text begin (2) the estimated cost of the project, including:
new text end

new text begin (i) capital costs;
new text end

new text begin (ii) the estimated cost per unit of energy delivered by the energy storage system; and
new text end

new text begin (iii) an evaluation of the cost-effectiveness of the energy storage system;
new text end

new text begin (3) the estimated benefits of the energy storage system to the public utility's electric
system, including but not limited to:
new text end

new text begin (i) deferred investments in generation, transmission, or distribution capacity;
new text end

new text begin (ii) reduced need for electricity during times of peak demand;
new text end

new text begin (iii) improved reliability of the public utility's transmission or distribution system; and
new text end

new text begin (iv) improved integration of the public utility's renewable energy resources;
new text end

new text begin (4) a description indicating how the addition of an energy storage system complements
the public utility's proposed actions described in the most recent integrated resource plan
submitted under section 216B.2422 to meet expected demand with the least expensive
combination of resources; and
new text end

new text begin (5) any additional information required by the commission.
new text end

new text begin (b) A public utility must include in the application an evaluation of the potential to store
energy throughout the public utility's electric system and must identify geographic areas in
the public utility's service area where the deployment of energy storage systems has the
greatest potential to achieve the economic benefits identified in paragraph (a), clause (3).
new text end

new text begin Subd. 4. new text end

new text begin Commission review. new text end

new text begin The commission must review each proposal submitted
under this section and may approve, reject, or modify the proposal. The commission must
approve a proposal the commission determines is in the public interest and reasonably
balances the value derived from the deployment of an energy storage system for ratepayers
and the public utility's operations with the cost to procure, construct, operate, and maintain
the energy storage system.
new text end

new text begin Subd. 5. new text end

new text begin Cost recovery. new text end

new text begin A public utility may recover from ratepayers all costs prudently
incurred by the public utility to deploy an energy storage system approved by the commission
under this section, net of any revenues generated by the operation of the energy storage
system.
new text end

new text begin Subd. 6. new text end

new text begin Commission authority; orders. new text end

new text begin The commission may issue orders necessary
to implement and administer this section.
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. 6.

new text begin [216C.377] ENERGY STORAGE INCENTIVE PROGRAM.
new text end

new text begin (a) The electric utility subject to section 116C.779 must develop and operate a program
to provide a lump-sum grant to customers to reduce the cost to purchase and install an on-site
energy storage system, as defined in section 216B.2422, subdivision 1, paragraph (f). The
utility subject to this section must file a plan with the commissioner to operate the program
no later than October 1, 2022. The utility must not operate the program until it is approved
by the commissioner. Any change to an operating program must be approved by the
commissioner.
new text end

new text begin (b) To be eligible to receive a grant under this section, an energy storage system:
new text end

new text begin (1) must have a capacity no greater than 50 kilowatt hours; and
new text end

new text begin (2) must be located within the electric service area of the utility subject to this section.
new text end

new text begin (c) An owner of an energy storage system is eligible to receive a grant under this section
if:
new text end

new text begin (1) a solar energy generating system is operating at the same site as the proposed energy
storage system; or
new text end

new text begin (2) the owner has filed an application with the utility subject to this section to interconnect
a solar energy generating system at the same site as the proposed energy storage system.
new text end

new text begin (d) The commissioner must annually review and may adjust the amount of grants awarded
under this section, but must not increase the amount over that awarded in previous years
unless the commissioner demonstrates in writing that an upward adjustment is warranted
by market conditions.
new text end

new text begin (e) A customer who receives a grant under this section is eligible to receive financial
assistance under programs operated by the state or the utility for the solar energy generating
system operating in conjunction with the energy storage system.
new text end

new text begin (f) For the purposes of this section, "solar energy generating system" has the meaning
given in section 216E.01, subdivision 9a.
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. 7. new text begin APPROPRIATION.
new text end

new text begin Notwithstanding Minnesota Statutes, section 116C.779, subdivision 1, paragraph (j),
$....... in fiscal year 2023 is appropriated from the renewable development account established
in Minnesota Statutes, section 116C.779, to the commissioner of commerce to award grants
to install energy storage systems under Minnesota Statutes, section 216C.377, and to pay
the reasonable costs of the department to administer that section. This appropriation remains
available until expended. The base for this program in fiscal year 2024 is $........
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