SF 3504

1st Engrossment - 90th Legislature (2017 - 2018) Posted on 05/14/2018 11:50am

A bill for an act
relating to energy; establishing a carbon reduction facility designation for certain
large electric generating facilities; proposing coding for new law in Minnesota
Statutes, chapter 216B.

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

Section 1.

[216B.1697] CARBON REDUCTION FACILITIES; NUCLEAR ENERGY.

Subdivision 1.

Qualifying facilities.

An existing large electric generating power plant,
as defined in section 216B.2421, subdivision 2, clause (1), employing nuclear technology
to generate electricity qualifies for designation as a carbon reduction facility as provided in
this section.

Subd. 2.

Proposal submission.

(a) A public utility may submit a proposal to the
commission for designation of a qualifying facility as a carbon reduction facility under this
section. The proposal must be filed within a public utility's new resource plan filing no
earlier than February 1, 2019. The proposal shall include:

(1) a showing that the facility meets the requirements of subdivision 1;

(2) a proposed statement of the total expected costs, including, but not limited to, capital
investments and operation and maintenance costs, associated with operation of the facility.
The total expected costs shall cover a period not to exceed the planning period of the public
utility's new resource plan;

(3) details about all costs currently included in rates, current operating costs if different
than those currently included in rates, and an evaluation of the utility's forecasted costs
prepared by an independent evaluator; and

(4) an analysis of how the proposed capital investments and operation and maintenance
costs would impact rates if that impact is different than any described in the utility's most
recently filed resource plan.

(b) If the information submitted in the original proposal changes because it was unknown
and not capable of being known at the time of the original proposal, a utility may at any
time file additional proposals for the same facility.

(c) The proposal may ask the commission to establish a sliding scale rate-of-return
mechanism for the capital investments to provide an additional incentive for the utility to
complete the project at or under the proposed costs.

Subd. 3.

Proposal approval.

(a) The commission shall approve, reject, or modify the
proposed designation of the facility and the total expected costs submitted by the public
utility. The commission shall make a final determination on the proposed designation
concurrent with its order in the resource plan, or sooner, should the commission determine
that it is in the public interest.

(b) When conducting the review in paragraph (a), the commission shall allow intervention
by the Department of Commerce, the Office of the Attorney General, ratepayer advocates,
and other interested parties. The public utility shall pay the costs of any nuclear expert
retained by the Department of Commerce.

(c) To the extent the commission modifies the proposal, the utility may choose whether
to accept the modifications. If the utility does not accept the modifications, the commission
shall deem the proposal withdrawn.

(d) With respect to any carbon reduction facility, the approval shall constitute a finding
of prudency for the total costs contained in the proposal, meaning that the utility shall be
entitled to recover, through a subsequent rate case, any actual costs not in excess of the
costs provided in its proposal for designation as a carbon reduction facility.

(e) Upon approval of a proposed designation of a facility and the total expected costs
submitted by the utility, the utility shall provide biennial updates to the commission regarding
its progress with respect to adhering to the approved costs. The commission may issue
orders it deems necessary to ensure that the carbon reduction facility remains cost-effective
for customers and financially viable for the utility.