<div class="xtend">
         <div class="xtend_ce"><a id="pl.1.1"></a><var>1.1</var>A bill for an act<br />
            		
         </div><a id="pl.1.2"></a><var>1.2</var>relating to energy; modifying or adding provisions relating to renewable energy <br />
         		<a id="pl.1.3"></a><var>1.3</var>production incentives and initiatives, C-BED contracts, renewable energy <br />
         		<a id="pl.1.4"></a><var>1.4</var>purchases, certain appraisal fees, energy conservation, utility costs and refunds, <br />
         		<a id="pl.1.5"></a><var>1.5</var>renewable and high-efficiency energy rate options, solar energy, utility energy <br />
         		<a id="pl.1.6"></a><var>1.6</var>savings, renewable residential heating, biomethane purchases, Sustainable <br />
         		<a id="pl.1.7"></a><var>1.7</var>Building 2030, power purchase agreements, power transmission, certificate <br />
         		<a id="pl.1.8"></a><var>1.8</var>of need exemptions, energy facilities, renewable development account, the <br />
         		<a id="pl.1.9"></a><var>1.9</var>reliability administrator, wind energy conversion systems, and Mountain Iron <br />
         		<a id="pl.1.10"></a><var>1.10</var>Economic Development Authority; requiring legislative reports and proposals; <br />
         		<a id="pl.1.11"></a><var>1.11</var>appropriating money;amending Minnesota Statutes 2008, sections 116C.779, <br />
         		<a id="pl.1.12"></a><var>1.12</var>subdivision 2, by adding a subdivision; 117.189; 216B.16, subdivision 6c, <br />
         		<a id="pl.1.13"></a><var>1.13</var>by adding a subdivision; 216B.1645, subdivision 2a; 216B.169, subdivision <br />
         		<a id="pl.1.14"></a><var>1.14</var>2; 216B.1691, subdivision 2a; 216B.23, by adding a subdivision; 216B.241, <br />
         		<a id="pl.1.15"></a><var>1.15</var>subdivisions 1c, 9, by adding subdivisions; 216B.2411, subdivisions 1, 2; <br />
         		<a id="pl.1.16"></a><var>1.16</var>216B.2424, subdivision 5a; 216B.2425, subdivision 3; 216B.243, subdivisions <br />
         		<a id="pl.1.17"></a><var>1.17</var>8, 9; 216C.052, subdivision 2; 216C.41, subdivision 5a; 216F.01, subdivisions <br />
         		<a id="pl.1.18"></a><var>1.18</var>2, 3; 216F.012; 216F.02; 216F.08; proposing coding for new law in Minnesota <br />
         		<a id="pl.1.19"></a><var>1.19</var>Statutes, chapters 216B; 216C; repealing Laws 2007, chapter 3, section 3.<br />
         		<a id="pl.1.20"></a><var>1.20</var>BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MINNESOTA:<br />
         		<br />
         		<a id="bill.0.1.0"></a><a id="pl.1.21"></a><var>1.21</var>&nbsp;&nbsp;&nbsp;&nbsp;Section 1. Minnesota Statutes 2008, section 116C.779, subdivision 2, is amended to <br />
         		<a id="pl.1.22"></a><var>1.22</var>read:<br />
         		<a id="pl.1.23"></a><var>1.23</var>&nbsp;&nbsp;&nbsp;&nbsp;Subd. 2. <b>Renewable energy production incentive.</b> (a) Until January 1, ~~2018~~ 2021, <br />
         		<a id="pl.1.24"></a><var>1.24</var>~~up to~~ $10,900,000 annually must be allocated from available funds in the account to <br />
         		<a id="pl.1.25"></a><var>1.25</var>fund renewable energy production incentives. $9,400,000 of this annual amount is for <br />
         		<a id="pl.1.26"></a><var>1.26</var>incentives for ~~up to 200 megawatts of~~ electricity generated by wind energy conversion <br />
         		<a id="pl.1.27"></a><var>1.27</var>systems that are eligible for the incentives under section 
         <statute_ref>216C.41</statute_ref> or Laws 2005, chapter <br />
         		<a id="pl.1.28"></a><var>1.28</var>40. <br />
         		<a id="pl.1.29"></a><var>1.29</var>(b) The balance of this amount, up to $1,500,000 annually, may be used for <br />
         		<a id="pl.1.30"></a><var>1.30</var>production incentives for on-farm biogas recovery facilities and hydroelectric facilities <br />
         		<a id="pl.2.1"></a><var>2.1</var>that are eligible for the incentive under section 
         <statute_ref>216C.41</statute_ref> ~~or for production incentives for~~ <br />
         		<a id="pl.2.2"></a><var>2.2</var>~~other renewables, to be provided in the same manner as under section~~ 
         <statute_ref>~~216C.41~~</statute_ref>. <br />
         		<a id="pl.2.3"></a><var>2.3</var>(c) Any funds allocated to incentive payments for wind energy conversion systems <br />
         		<a id="pl.2.4"></a><var>2.4</var>under paragraph (a) that are not expended for that purpose must be allocated to incentive <br />
         		<a id="pl.2.5"></a><var>2.5</var>payments under paragraph (b) if necessary to fully pay eligible claims for incentive <br />
         		<a id="pl.2.6"></a><var>2.6</var>payments to qualified on-farm biogas recovery facilities and hydroelectric facilities.<br />
         		<a id="pl.2.7"></a><var>2.7</var>(d) If funds allocated in calendar year 2010 under paragraphs (b) and (c) are <br />
         		<a id="pl.2.8"></a><var>2.8</var>insufficient to fully pay eligible claims for incentive payments to qualified on-farm biogas <br />
         		<a id="pl.2.9"></a><var>2.9</var>recovery facilities and hydroelectric facilities, up to $500,000 of additional funds in the <br />
         		<a id="pl.2.10"></a><var>2.10</var>renewable development account must be allocated to make up the insufficiency.<br />
         		<a id="pl.2.11"></a><var>2.11</var>(e) Any portion of the $10,900,000 not expended in any calendar year for the <br />
         		<a id="pl.2.12"></a><var>2.12</var>incentive is available for other spending purposes under this section. This subdivision <br />
         		<a id="pl.2.13"></a><var>2.13</var>does not create an obligation to contribute funds to the account.<br />
         		<a id="pl.2.14"></a><var>2.14</var>~~(b)~~ (f) The Department of Commerce shall determine eligibility of projects under <br />
         		<a id="pl.2.15"></a><var>2.15</var>section 
         <statute_ref>216C.41</statute_ref> for the purposes of this subdivision. At least quarterly, the Department of <br />
         		<a id="pl.2.16"></a><var>2.16</var>Commerce shall notify the public utility of the name and address of each eligible project <br />
         		<a id="pl.2.17"></a><var>2.17</var>owner and the amount due to each project under section 
         <statute_ref>216C.41</statute_ref>. The public utility shall <br />
         		<a id="pl.2.18"></a><var>2.18</var>make payments within 15 working days after receipt of notification of payments due.<br />
         		<br />
         		<a id="bill.0.2.0"></a><a id="pl.2.19"></a><var>2.19</var>&nbsp;&nbsp;&nbsp;&nbsp;Sec. 2. Minnesota Statutes 2008, section 116C.779, is amended by adding a subdivision <br />
         		<a id="pl.2.20"></a><var>2.20</var>to read:<br />
         		<a id="pl.2.21"></a><var>2.21</var>&nbsp;&nbsp;&nbsp;&nbsp;Subd. 3. <b>Initiative for Renewable Energy and the Environment</b>  (a) Beginning <br />
         		<a id="pl.2.22"></a><var>2.22</var>July 1, 2011, and each July 1 thereafter, $5,000,000 must be allocated from the renewable <br />
         		<a id="pl.2.23"></a><var>2.23</var>development account to fund a grant to the Board of Regents of the University of <br />
         		<a id="pl.2.24"></a><var>2.24</var>Minnesota for the Initiative for Renewable Energy and the Environment for the purposes <br />
         		<a id="pl.2.25"></a><var>2.25</var>described in paragraph (b). The Initiative for Renewable Energy and the Environment <br />
         		<a id="pl.2.26"></a><var>2.26</var>must set aside at least 15 percent of the funds received annually under the grant for <br />
         		<a id="pl.2.27"></a><var>2.27</var>qualified projects conducted at a rural campus or experiment station. Any set-aside funds <br />
         		<a id="pl.2.28"></a><var>2.28</var>not awarded to a rural campus or experiment station at the end of the fiscal year revert <br />
         		<a id="pl.2.29"></a><var>2.29</var>back to the Initiative for Renewable Energy and the Environment for its exclusive use. <br />
         		<a id="pl.2.30"></a><var>2.30</var>This subdivision does not create an obligation to contribute funds to the account.   <br />
         		<a id="pl.2.31"></a><var>2.31</var>(b) Activities funded under this grant may include, but are not limited to:<br />
         		<a id="pl.2.32"></a><var>2.32</var>(1) environmentally sound production of energy from a renewable energy source, <br />
         		<a id="pl.2.33"></a><var>2.33</var>including biomass;<br />
         		<a id="pl.2.34"></a><var>2.34</var>(2) environmentally sound production of hydrogen from biomass and any other <br />
         		<a id="pl.2.35"></a><var>2.35</var>renewable energy source for energy storage and energy utilization;<br />
         		<a id="pl.3.1"></a><var>3.1</var>(3) development of energy conservation and efficient energy utilization technologies;<br />
         		<a id="pl.3.2"></a><var>3.2</var>(4) energy storage technologies; and<br />
         		<a id="pl.3.3"></a><var>3.3</var>(5) analysis of policy options to facilitate adoption of technologies that use or <br />
         		<a id="pl.3.4"></a><var>3.4</var>produce low-carbon renewable energy.<br />
         		<a id="pl.3.5"></a><var>3.5</var>(c) For the purposes of this subdivision:<br />
         		<a id="pl.3.6"></a><var>3.6</var>(1) "biomass" means plant and animal material, agricultural and forest residues, <br />
         		<a id="pl.3.7"></a><var>3.7</var>mixed municipal solid waste, and sludge from wastewater treatment; and<br />
         		<a id="pl.3.8"></a><var>3.8</var>(2) "renewable energy source" means hydro, wind, solar, biomass, and geothermal <br />
         		<a id="pl.3.9"></a><var>3.9</var>energy, and microorganisms used as an energy source.<br />
         		<br />
         		<a id="bill.0.3.0"></a><a id="pl.3.10"></a><var>3.10</var>&nbsp;&nbsp;&nbsp;&nbsp;Sec. 3. Minnesota Statutes 2008, section 117.189, is amended to read:<br />
         		<a id="pl.3.11"></a><var>3.11</var><b>117.189 PUBLIC SERVICE CORPORATION EXCEPTIONS.</b><br />
         		<a id="pl.3.12"></a><var>3.12</var>Sections 
         <statute_ref>117.031</statute_ref>; 
         <statute_ref>117.036</statute_ref>; 
         <statute_ref>117.055</statute_ref>, subdivision 2, paragraph (b); 
         <statute_ref>117.186</statute_ref>; 
         <statute_ref>117.187</statute_ref>; <br />
         		
         <statute_ref><a id="pl.3.13"></a><var>3.13</var>117.188
         </statute_ref>; and 
         <statute_ref>117.52</statute_ref>, subdivisions 1a and 4, do not apply to public service corporations. <br />
         		<a id="pl.3.14"></a><var>3.14</var>For purposes of an award of appraisal fees under section 
         <statute_ref>117.085</statute_ref>, the fees awarded may <br />
         		<a id="pl.3.15"></a><var>3.15</var>not exceed ~~$500~~ $1,500 for all types of property.<br />
         		<br />
         		<a id="bill.0.4.0"></a><a id="pl.3.16"></a><var>3.16</var>&nbsp;&nbsp;&nbsp;&nbsp;Sec. 4. Minnesota Statutes 2008, section 216B.16, subdivision 6c, is amended to read:<br />
         		<a id="pl.3.17"></a><var>3.17</var>&nbsp;&nbsp;&nbsp;&nbsp;Subd. 6c. <b>Incentive plan for energy conservation improvement.</b> (a) The <br />
         		<a id="pl.3.18"></a><var>3.18</var>commission may order public utilities to develop and submit for commission approval <br />
         		<a id="pl.3.19"></a><var>3.19</var>incentive plans that describe the method of recovery and accounting for utility <br />
         		<a id="pl.3.20"></a><var>3.20</var>conservation expenditures and savings. In developing the incentive plans the commission <br />
         		<a id="pl.3.21"></a><var>3.21</var>shall ensure the effective involvement of interested parties.<br />
         		<a id="pl.3.22"></a><var>3.22</var>(b) In approving incentive plans, the commission shall consider:<br />
         		<a id="pl.3.23"></a><var>3.23</var>(1) whether the plan is likely to increase utility investment in cost-effective energy <br />
         		<a id="pl.3.24"></a><var>3.24</var>conservation;<br />
         		<a id="pl.3.25"></a><var>3.25</var>(2) whether the plan is compatible with the interest of utility ratepayers and other <br />
         		<a id="pl.3.26"></a><var>3.26</var>interested parties;<br />
         		<a id="pl.3.27"></a><var>3.27</var>(3) whether the plan links the incentive to the utility's performance in achieving <br />
         		<a id="pl.3.28"></a><var>3.28</var>cost-effective conservation; and<br />
         		<a id="pl.3.29"></a><var>3.29</var>(4) whether the plan is in conflict with other provisions of this chapter.<br />
         		<a id="pl.3.30"></a><var>3.30</var>(c) The commission may set rates to encourage the vigorous and effective <br />
         		<a id="pl.3.31"></a><var>3.31</var>implementation of utility conservation programs. The commission may:<br />
         		<a id="pl.3.32"></a><var>3.32</var>(1) increase or decrease any otherwise allowed rate of return on net investment based <br />
         		<a id="pl.3.33"></a><var>3.33</var>upon the utility's skill, efforts, and success in conserving energy;<br />
         		<a id="pl.4.1"></a><var>4.1</var>(2) share between ratepayers and utilities the net savings resulting from energy <br />
         		<a id="pl.4.2"></a><var>4.2</var>conservation programs to the extent justified by the utility's skill, efforts, and success in <br />
         		<a id="pl.4.3"></a><var>4.3</var>conserving energy; and<br />
         		<a id="pl.4.4"></a><var>4.4</var>(3) ~~compensate the utility for earnings lost as a result of its conservation programs~~ <br />
         		<a id="pl.4.5"></a><var>4.5</var>adopt any mechanism that satisfies the criteria of this subdivision.<br />
         		<a id="pl.4.6"></a><var>4.6</var>(d) In its review under section 216B.241, subdivision 2c, the commission shall <br />
         		<a id="pl.4.7"></a><var>4.7</var>provide an incentive that makes effective implementation of cost-effective conservation <br />
         		<a id="pl.4.8"></a><var>4.8</var>the most profitable resource choice for public utilities.<br />
         		<br />
         		<a id="bill.0.5.0"></a><a id="pl.4.9"></a><var>4.9</var>&nbsp;&nbsp;&nbsp;&nbsp;Sec. 5. Minnesota Statutes 2008, section 216B.16, is amended by adding a subdivision <br />
         		<a id="pl.4.10"></a><var>4.10</var>to read:<br />
         		<a id="pl.4.11"></a><var>4.11</var>&nbsp;&nbsp;&nbsp;&nbsp;Subd. 7d. <b>University Avenue light rail transit utility zone cost adjustment.</b> (a) <br />
         		<a id="pl.4.12"></a><var>4.12</var>"University Avenue light rail transit utility zone" or "utility zone" means an area extending <br />
         		<a id="pl.4.13"></a><var>4.13</var>no more than one-half mile on either side of the route for the planned light rail transit <br />
         		<a id="pl.4.14"></a><var>4.14</var>system connecting the cities of Minneapolis and St. Paul along University Avenue.<br />
         		<a id="pl.4.15"></a><var>4.15</var>(b) A public utility that provides retail electric service within the utility zone, <br />
         		<a id="pl.4.16"></a><var>4.16</var>and which is required to replace, relocate, construct, or install facilities because of the <br />
         		<a id="pl.4.17"></a><var>4.17</var>mass transit system, may apply to the commission for approval of new facilities in the <br />
         		<a id="pl.4.18"></a><var>4.18</var>utility zone. Facilities proposed under this subdivision are not limited to those facilities <br />
         		<a id="pl.4.19"></a><var>4.19</var>that actually replace dislocated facilities and may include any transmission facilities, <br />
         		<a id="pl.4.20"></a><var>4.20</var>distribution facilities, generation facilities, advanced technology-assisted efficiency <br />
         		<a id="pl.4.21"></a><var>4.21</var>devices, and energy storage facilities within the utility zone. Upon approval under <br />
         		<a id="pl.4.22"></a><var>4.22</var>paragraph (c), the utility may construct and install the facilities.<br />
         		<a id="pl.4.23"></a><var>4.23</var>(c) The commission may approve the construction and installation of facilities in a <br />
         		<a id="pl.4.24"></a><var>4.24</var>mass transit utility zone proposed by a utility under paragraph (b) upon a finding:<br />
         		<a id="pl.4.25"></a><var>4.25</var>(1) that the facilities:<br />
         		<a id="pl.4.26"></a><var>4.26</var>(i) are necessary to provide electric service;<br />
         		<a id="pl.4.27"></a><var>4.27</var>(ii) assist future development of renewable energy, conservation, electric vehicles, or <br />
         		<a id="pl.4.28"></a><var>4.28</var>advanced technology-assisted efficiency programs and devices; or<br />
         		<a id="pl.4.29"></a><var>4.29</var>(iii) are exploratory, experimental, or research facilities to advance the use of <br />
         		<a id="pl.4.30"></a><var>4.30</var>renewable energy, conservation, electric vehicles, or advanced technology-assisted <br />
         		<a id="pl.4.31"></a><var>4.31</var>efficiency programs and devices;<br />
         		<a id="pl.4.32"></a><var>4.32</var>(2) that the utility has engaged in a cooperative process with affected local and state <br />
         		<a id="pl.4.33"></a><var>4.33</var>government agencies in the design, planning, or construction of the utility zone project <br />
         		<a id="pl.4.34"></a><var>4.34</var>and changes to utility facilities;<br />
         		<a id="pl.5.1"></a><var>5.1</var>(3) that the utility and local units of government have made reasonable efforts to seek <br />
         		<a id="pl.5.2"></a><var>5.2</var>federal, state, or private funds that may be available to mass transit and energy projects; <br />
         		<a id="pl.5.3"></a><var>5.3</var>(4) that the utility has made reasonable efforts to minimize the costs and maximize <br />
         		<a id="pl.5.4"></a><var>5.4</var>the value to customers of the facilities;<br />
         		<a id="pl.5.5"></a><var>5.5</var>(5) that the utility has a plan to offer a comprehensive array of programs for <br />
         		<a id="pl.5.6"></a><var>5.6</var>residential, commercial, and industrial customers located within the mass transit zone;<br />
         		<a id="pl.5.7"></a><var>5.7</var>(6) that the utility direct existing and planned solar energy programs to develop solar <br />
         		<a id="pl.5.8"></a><var>5.8</var>energy along the mass transit utility zone; and<br />
         		<a id="pl.5.9"></a><var>5.9</var>(7) that the utility has made reasonable efforts to apply for federal funds to develop <br />
         		<a id="pl.5.10"></a><var>5.10</var>technology-assisted efficiency programs and devices within the mass transit utility zone.<br />
         		<a id="pl.5.11"></a><var>5.11</var>(d) Notwithstanding any other provision of this chapter, the commission may approve <br />
         		<a id="pl.5.12"></a><var>5.12</var>a tariff mechanism for automatic adjustment of charges for new, replaced, or relocated <br />
         		<a id="pl.5.13"></a><var>5.13</var>facilities installed under this subdivision in a manner consistent with this subdivision and <br />
         		<a id="pl.5.14"></a><var>5.14</var>the standards and procedures contained in subdivision 7b, except that no approval under <br />
         		<a id="pl.5.15"></a><var>5.15</var>section 216B.243 or certification under section 216B.2425 is required unless otherwise <br />
         		<a id="pl.5.16"></a><var>5.16</var>required by law. This section does not authorize a city-requested facilities surcharge.<br />
         		<a id="pl.5.17"></a><var>5.17</var>(e) For the purpose of this subdivision, "technology-assisted efficiency programs and <br />
         		<a id="pl.5.18"></a><var>5.18</var>devices" includes, but is not limited to, infrastructure that integrates digital information and <br />
         		<a id="pl.5.19"></a><var>5.19</var>controls technology to improve the reliability, security, and efficiency of the electric grid.<br />
         		<br />
         		<a id="bill.0.6.0"></a><a id="pl.5.20"></a><var>5.20</var>&nbsp;&nbsp;&nbsp;&nbsp;Sec. 6. <b>[216B.1613] STANDARDIZED C-BED CONTRACT.</b><br />
         		<a id="pl.5.21"></a><var>5.21</var>(a) Within 60 days of the effective date of this section, the commission shall initiate <br />
         		<a id="pl.5.22"></a><var>5.22</var>a proceeding to standardize all contract provisions, except those establishing the power <br />
         		<a id="pl.5.23"></a><var>5.23</var>purchase price, for two classes of C-BED projects:<br />
         		<a id="pl.5.24"></a><var>5.24</var>(1) projects with a nameplate capacity of five megawatts or less; and<br />
         		<a id="pl.5.25"></a><var>5.25</var>(2) projects with a nameplate capacity of greater than five megawatts.<br />
         		<a id="pl.5.26"></a><var>5.26</var>&nbsp;&nbsp;&nbsp;&nbsp;(b) The proceeding shall provide for participation by the public and stakeholders. <br />
         		<a id="pl.5.27"></a><var>5.27</var>The commission shall issue an order containing standardized contract language for each <br />
         		<a id="pl.5.28"></a><var>5.28</var>class of C-BED project identified in this section no later than 90 days after the opening of <br />
         		<a id="pl.5.29"></a><var>5.29</var>the proceeding. The standardized contract form must be similar in all material respects to <br />
         		<a id="pl.5.30"></a><var>5.30</var>the standard contract form previously filed with the commission under section 216B.2423, <br />
         		<a id="pl.5.31"></a><var>5.31</var>subdivision 3, including any revisions to that contract on file with the commission as of <br />
         		<a id="pl.5.32"></a><var>5.32</var>the effective date of this section. Any applicable C-BED contract signed after the date of <br />
         		<a id="pl.5.33"></a><var>5.33</var>the commission's order whose provisions are not identical to the standardized contract <br />
         		<a id="pl.5.34"></a><var>5.34</var>contained in the commission's order is invalid.<br />
         		<a id="pl.5.35"></a><var>5.35</var><b>EFFECTIVE DATE.</b>This section is effective the day following final enactment.<br />
         		<br />
         		<a id="bill.0.7.0"></a><a id="pl.6.1"></a><var>6.1</var>&nbsp;&nbsp;&nbsp;&nbsp;Sec. 7. <b>[216B.1614] SMALL RENEWABLE PROJECTS PURCHASE.</b><br />
         		<a id="pl.6.2"></a><var>6.2</var>Between the effective date of this section and December 31, 2010, electric utilities, <br />
         		<a id="pl.6.3"></a><var>6.3</var>as defined in section 216B.1691, subdivision 1, paragraph (b), must purchase or contract to <br />
         		<a id="pl.6.4"></a><var>6.4</var>purchase energy from a sufficient number of renewable energy projects with a nameplate <br />
         		<a id="pl.6.5"></a><var>6.5</var>capacity of five megawatts or less so as to total at least 200 megawatts in the aggregate. <br />
         		<a id="pl.6.6"></a><var>6.6</var>Such projects must be constructed or under construction by December 31, 2010, and must <br />
         		<a id="pl.6.7"></a><var>6.7</var>meet the eligibility requirements for a renewable energy incentive under the American <br />
         		<a id="pl.6.8"></a><var>6.8</var>Recovery and Reinvestment Act of 2009, the federal Rural Energy for America Program, <br />
         		<a id="pl.6.9"></a><var>6.9</var>or other renewable energy incentive program. Before December 31, 2010, an electric <br />
         		<a id="pl.6.10"></a><var>6.10</var>utility must undertake such projects in approximate proportion to its share of the total <br />
         		<a id="pl.6.11"></a><var>6.11</var>amount of electrical energy sold within this state. This requirement does not prevent an <br />
         		<a id="pl.6.12"></a><var>6.12</var>electric utility from developing or acquiring electrical energy from other sources either <br />
         		<a id="pl.6.13"></a><var>6.13</var>within or outside the state regardless of whether such sources use renewable energy.<br />
         		<br />
         		<a id="bill.0.8.0"></a><a id="pl.6.14"></a><var>6.14</var>&nbsp;&nbsp;&nbsp;&nbsp;Sec. 8. Minnesota Statutes 2008, section 216B.1645, subdivision 2a, is amended to <br />
         		<a id="pl.6.15"></a><var>6.15</var>read:<br />
         		<a id="pl.6.16"></a><var>6.16</var>&nbsp;&nbsp;&nbsp;&nbsp;Subd. 2a.  <b>Cost recovery for utility's renewable facilities.</b> (a) A utility may petition <br />
         		<a id="pl.6.17"></a><var>6.17</var>the commission to approve a rate schedule that provides for the automatic adjustment of <br />
         		<a id="pl.6.18"></a><var>6.18</var>charges to recover prudently incurred investments, expenses, or costs associated with <br />
         		<a id="pl.6.19"></a><var>6.19</var>facilities constructed, owned, or operated by a utility to satisfy the requirements of section <br />
         		
         <statute_ref><a id="pl.6.20"></a><var>6.20</var>216B.1691
         </statute_ref>, provided those facilities were previously approved by the commission under <br />
         		<a id="pl.6.21"></a><var>6.21</var>section 216B.2422 or 
         <statute_ref>216B.243</statute_ref>, or were determined by the commission to be reasonable <br />
         		<a id="pl.6.22"></a><var>6.22</var>and prudent under section 216B.243, subdivision 9. For a facility not subject to review <br />
         		<a id="pl.6.23"></a><var>6.23</var>by the commission under section 216B.2422 or 216B.243, a utility shall first petition <br />
         		<a id="pl.6.24"></a><var>6.24</var>the commission to determine the utility's eligibility to apply for cost recovery for the <br />
         		<a id="pl.6.25"></a><var>6.25</var>facility under this section. The commission may approve, or approve as modified, a <br />
         		<a id="pl.6.26"></a><var>6.26</var>rate schedule that: <br />
         		<a id="pl.6.27"></a><var>6.27</var>&nbsp;&nbsp;&nbsp;&nbsp;(1) allows a utility to recover directly from customers on a timely basis the costs of <br />
         		<a id="pl.6.28"></a><var>6.28</var>qualifying renewable energy projects, including: <br />
         		<a id="pl.6.29"></a><var>6.29</var>&nbsp;&nbsp;&nbsp;&nbsp;(i) return on investment; <br />
         		<a id="pl.6.30"></a><var>6.30</var>&nbsp;&nbsp;&nbsp;&nbsp;(ii) depreciation; <br />
         		<a id="pl.6.31"></a><var>6.31</var>&nbsp;&nbsp;&nbsp;&nbsp;(iii) ongoing operation and maintenance costs; <br />
         		<a id="pl.6.32"></a><var>6.32</var>&nbsp;&nbsp;&nbsp;&nbsp;(iv) taxes; and <br />
         		<a id="pl.6.33"></a><var>6.33</var>&nbsp;&nbsp;&nbsp;&nbsp;(v) costs of transmission and other ancillary expenses directly allocable to <br />
         		<a id="pl.6.34"></a><var>6.34</var>transmitting electricity generated from a project meeting the specifications of this <br />
         		<a id="pl.6.35"></a><var>6.35</var>paragraph; <br />
         		<a id="pl.7.1"></a><var>7.1</var>&nbsp;&nbsp;&nbsp;&nbsp;(2) provides a current return on construction work in progress, provided that recovery <br />
         		<a id="pl.7.2"></a><var>7.2</var>of these costs from Minnesota ratepayers is not sought through any other mechanism; <br />
         		<a id="pl.7.3"></a><var>7.3</var>&nbsp;&nbsp;&nbsp;&nbsp;(3) allows recovery of other expenses incurred that are directly related to a <br />
         		<a id="pl.7.4"></a><var>7.4</var>renewable energy project, including expenses for energy storage, provided that the <br />
         		<a id="pl.7.5"></a><var>7.5</var>utility demonstrates to the commission's satisfaction that the expenses improve project <br />
         		<a id="pl.7.6"></a><var>7.6</var>economics, ensure project implementation, advance research and understanding of how <br />
         		<a id="pl.7.7"></a><var>7.7</var>storage devices may improve renewable energy projects, or facilitate coordination with <br />
         		<a id="pl.7.8"></a><var>7.8</var>the development of transmission necessary to transport energy produced by the project <br />
         		<a id="pl.7.9"></a><var>7.9</var>to market; <br />
         		<a id="pl.7.10"></a><var>7.10</var>&nbsp;&nbsp;&nbsp;&nbsp;(4) allocates recoverable costs appropriately between wholesale and retail customers; <br />
         		<a id="pl.7.11"></a><var>7.11</var>&nbsp;&nbsp;&nbsp;&nbsp;(5) terminates recovery when costs have been fully recovered or have otherwise <br />
         		<a id="pl.7.12"></a><var>7.12</var>been reflected in a utility's rates. <br />
         		<a id="pl.7.13"></a><var>7.13</var>&nbsp;&nbsp;&nbsp;&nbsp;(b) A petition filed under this subdivision must include: <br />
         		<a id="pl.7.14"></a><var>7.14</var>&nbsp;&nbsp;&nbsp;&nbsp;(1) a description of the facilities for which costs are to be recovered; <br />
         		<a id="pl.7.15"></a><var>7.15</var>&nbsp;&nbsp;&nbsp;&nbsp;(2) an implementation schedule for the facilities; <br />
         		<a id="pl.7.16"></a><var>7.16</var>&nbsp;&nbsp;&nbsp;&nbsp;(3) the utility's costs for the facilities; <br />
         		<a id="pl.7.17"></a><var>7.17</var>&nbsp;&nbsp;&nbsp;&nbsp;(4) a description of the utility's efforts to ensure that costs of the facilities are <br />
         		<a id="pl.7.18"></a><var>7.18</var>reasonable and were prudently incurred; and <br />
         		<a id="pl.7.19"></a><var>7.19</var>&nbsp;&nbsp;&nbsp;&nbsp;(5) a description of the benefits of the project in promoting the development of <br />
         		<a id="pl.7.20"></a><var>7.20</var>renewable energy in a manner consistent with this chapter. <br />
         		<br />
         		<a id="bill.0.9.0"></a><a id="pl.7.21"></a><var>7.21</var>&nbsp;&nbsp;&nbsp;&nbsp;Sec. 9. Minnesota Statutes 2008, section 216B.169, subdivision 2, is amended to read:<br />
         		<a id="pl.7.22"></a><var>7.22</var>&nbsp;&nbsp;&nbsp;&nbsp;Subd. 2. <b>Renewable and high-efficiency energy rate options.</b> (a) ~~Each~~ A <br />
         		<a id="pl.7.23"></a><var>7.23</var>utility ~~shall~~ may offer its customers~~, and shall advertise the offer at least annually,~~ <br />
         		<a id="pl.7.24"></a><var>7.24</var>one or more options that allow a customer to determine that a certain amount of the <br />
         		<a id="pl.7.25"></a><var>7.25</var>electricity generated or purchased on behalf of the customer is renewable energy or energy <br />
         		<a id="pl.7.26"></a><var>7.26</var>generated by high-efficiency, low-emissions, distributed generation such as fuel cells and <br />
         		<a id="pl.7.27"></a><var>7.27</var>microturbines fueled by a renewable fuel.<br />
         		<a id="pl.7.28"></a><var>7.28</var>~~(b) Each public utility shall file an implementation plan within 90 days of July 1,~~ <br />
         		<a id="pl.7.29"></a><var>7.29</var>~~2001, to implement paragraph (a).~~<br />
         		<a id="pl.7.30"></a><var>7.30</var>~~(c)~~ (b) Rates charged to customers must be calculated using the utility's cost of <br />
         		<a id="pl.7.31"></a><var>7.31</var>acquiring the energy for the customer and must:<br />
         		<a id="pl.7.32"></a><var>7.32</var>(1) reflect the difference between the cost of generating or purchasing the <br />
         		<a id="pl.7.33"></a><var>7.33</var>additional renewable ~~energy and the cost of generating or purchasing the same amount~~ <br />
         		<a id="pl.7.34"></a><var>7.34</var>~~of nonrenewable~~ energy and the cost that would otherwise be attributed to the customer <br />
         		<a id="pl.8.1"></a><var>8.1</var>for the same amount of energy based on the utility's mix of renewable and nonrenewable <br />
         		<a id="pl.8.2"></a><var>8.2</var>energy sources; and<br />
         		<a id="pl.8.3"></a><var>8.3</var>(2) be distributed on a per kilowatt-hour basis among all customers who choose to <br />
         		<a id="pl.8.4"></a><var>8.4</var>participate in the program.<br />
         		<a id="pl.8.5"></a><var>8.5</var>(d) ~~Implementation of these rate options may reflect a reasonable amount of~~ <br />
         		<a id="pl.8.6"></a><var>8.6</var>~~lead time necessary to arrange acquisition of the energy.~~ The utility may acquire the <br />
         		<a id="pl.8.7"></a><var>8.7</var>energy demanded by customers, in whole or in part, through procuring or generating the <br />
         		<a id="pl.8.8"></a><var>8.8</var>renewable energy directly, or through the purchase of credits from a provider that has <br />
         		<a id="pl.8.9"></a><var>8.9</var>received certification of eligible power supply pursuant to subdivision 3. ~~If a utility is not~~ <br />
         		<a id="pl.8.10"></a><var>8.10</var>~~able to arrange an adequate supply of renewable or high-efficiency energy to meet its~~ <br />
         		<a id="pl.8.11"></a><var>8.11</var>~~customers' demand under this section, the utility must file a report with the commission~~ <br />
         		<a id="pl.8.12"></a><var>8.12</var>~~detailing its efforts and reasons for its failure.~~<br />
         		<a id="pl.8.13"></a><var>8.13</var><b>EFFECTIVE DATE.</b>This section is effective the day following final enactment.<br />
         		<br />
         		<a id="bill.0.10.0"></a><a id="pl.8.14"></a><var>8.14</var>&nbsp;&nbsp;&nbsp;&nbsp;Sec. 10. Minnesota Statutes 2008, section 216B.1691, subdivision 2a, is amended to <br />
         		<a id="pl.8.15"></a><var>8.15</var>read:<br />
         		<a id="pl.8.16"></a><var>8.16</var>&nbsp;&nbsp;&nbsp;&nbsp;Subd. 2a. <b>Eligible energy technology standard.</b> (a) Except as provided in <br />
         		<a id="pl.8.17"></a><var>8.17</var>paragraph (b), each electric utility shall generate or procure sufficient electricity generated <br />
         		<a id="pl.8.18"></a><var>8.18</var>by an eligible energy technology to provide its retail customers in Minnesota, or the <br />
         		<a id="pl.8.19"></a><var>8.19</var>retail customers of a distribution utility to which the electric utility provides wholesale <br />
         		<a id="pl.8.20"></a><var>8.20</var>electric service, so that at least the following standard percentages of the electric utility's <br />
         		<a id="pl.8.21"></a><var>8.21</var>total retail electric sales to retail customers in Minnesota are generated by eligible energy <br />
         		<a id="pl.8.22"></a><var>8.22</var>technologies by the end of the year indicated:<br />
         		
         <table>
            <col width="50px"></col>
            <col width="71px"></col>
            <col width="71px"></col>
            <col width="277px"></col>
            <tr>
               <td><a id="pl.8.23"></a><var>8.23</var><br />
                  		
               </td>
               <td>(1)<br />
                  		
               </td>
               <td align="left">2012<br />
                  		
               </td>
               <td>12 percent<br />
                  		
               </td>
            </tr>
            <tr>
               <td><a id="pl.8.24"></a><var>8.24</var><br />
                  		
               </td>
               <td>(2)<br />
                  		
               </td>
               <td align="left">2016<br />
                  		
               </td>
               <td>17 percent<br />
                  		
               </td>
            </tr>
            <tr>
               <td><a id="pl.8.25"></a><var>8.25</var><br />
                  		
               </td>
               <td>(3)<br />
                  		
               </td>
               <td align="left">2020<br />
                  		
               </td>
               <td>20 percent<br />
                  		
               </td>
            </tr>
            <tr>
               <td><a id="pl.8.26"></a><var>8.26</var><br />
                  		
               </td>
               <td>(4)<br />
                  		
               </td>
               <td align="left">2025<br />
                  		
               </td>
               <td>25 percent.<br />
                  		
               </td>
            </tr>
         </table><a id="pl.8.27"></a><var>8.27</var>&nbsp;&nbsp;&nbsp;&nbsp;(b) An electric utility that owned a nuclear generating facility as of January 1, 2007, <br />
         		<a id="pl.8.28"></a><var>8.28</var>must meet the requirements of this paragraph rather than paragraph (a). An electric utility <br />
         		<a id="pl.8.29"></a><var>8.29</var>subject to this paragraph must generate or procure sufficient electricity generated by <br />
         		<a id="pl.8.30"></a><var>8.30</var>an eligible energy technology to provide its retail customers in Minnesota or the retail <br />
         		<a id="pl.8.31"></a><var>8.31</var>customer of a distribution utility to which the electric utility provides wholesale electric <br />
         		<a id="pl.8.32"></a><var>8.32</var>service so that at least the following percentages of the electric utility's total retail electric <br />
         		<a id="pl.8.33"></a><var>8.33</var>sales to retail customers in Minnesota are generated by eligible energy technologies by the <br />
         		<a id="pl.8.34"></a><var>8.34</var>end of the year indicated:<br />
         		
         <table>
            <col width="50px"></col>
            <col width="71px"></col>
            <col width="71px"></col>
            <col width="277px"></col>
            <tr>
               <td><a id="pl.9.1"></a><var>9.1</var><br />
                  		
               </td>
               <td>(1)<br />
                  		
               </td>
               <td align="left">2010<br />
                  		
               </td>
               <td align="left">15 percent<br />
                  		
               </td>
            </tr>
            <tr>
               <td><a id="pl.9.2"></a><var>9.2</var><br />
                  		
               </td>
               <td>(2)<br />
                  		
               </td>
               <td align="left">2012<br />
                  		
               </td>
               <td align="left">18 percent<br />
                  		
               </td>
            </tr>
            <tr>
               <td><a id="pl.9.3"></a><var>9.3</var><br />
                  		
               </td>
               <td>(3)<br />
                  		
               </td>
               <td align="left">2016<br />
                  		
               </td>
               <td align="left">25 percent<br />
                  		
               </td>
            </tr>
            <tr>
               <td><a id="pl.9.4"></a><var>9.4</var><br />
                  		
               </td>
               <td>(4)<br />
                  		
               </td>
               <td align="left">2020<br />
                  		
               </td>
               <td align="left">30 percent.<br />
                  		
               </td>
            </tr>
         </table><a id="pl.9.5"></a><var>9.5</var>Of the 30 percent in 2020, at least 25 percent must be generated by wind or solar <br />
         		<a id="pl.9.6"></a><var>9.6</var>energy conversion systems and the remaining five percent by other eligible energy <br />
         		<a id="pl.9.7"></a><var>9.7</var>technology.<br />
         		<br />
         		<a id="bill.0.11.0"></a><a id="pl.9.8"></a><var>9.8</var>&nbsp;&nbsp;&nbsp;&nbsp;Sec. 11. Minnesota Statutes 2008, section 216B.23, is amended by adding a subdivision <br />
         		<a id="pl.9.9"></a><var>9.9</var>to read:<br />
         		<a id="pl.9.10"></a><var>9.10</var>&nbsp;&nbsp;&nbsp;&nbsp;Subd. 1a. <b>Authority to issue refund.</b> (a) On determining that a public utility has <br />
         		<a id="pl.9.11"></a><var>9.11</var>charged a rate in violation of this chapter, a commission rule, or a commission order, the <br />
         		<a id="pl.9.12"></a><var>9.12</var>commission, after conducting a proceeding, may require the public utility to refund to its <br />
         		<a id="pl.9.13"></a><var>9.13</var>customers, in a manner approved by the commission, any revenues the commission finds <br />
         		<a id="pl.9.14"></a><var>9.14</var>were collected as a result of the unlawful conduct. Any refund authorized by this section <br />
         		<a id="pl.9.15"></a><var>9.15</var>is permitted in addition to any remedies authorized by section 216B.16 or any other law <br />
         		<a id="pl.9.16"></a><var>9.16</var>governing rates. Exercising authority under this section does not preclude the commission <br />
         		<a id="pl.9.17"></a><var>9.17</var>from pursuing penalties under sections 216B.57 to 216B.61 for the same conduct.<br />
         		<a id="pl.9.18"></a><var>9.18</var>(b) This section must not be construed as allowing:<br />
         		<a id="pl.9.19"></a><var>9.19</var>(1) retroactive ratemaking;<br />
         		<a id="pl.9.20"></a><var>9.20</var>(2) refunds based on claims that prior or current approved rates have been unjust, <br />
         		<a id="pl.9.21"></a><var>9.21</var>unreasonable, unreasonably preferential, discriminatory, insufficient, inequitable, or <br />
         		<a id="pl.9.22"></a><var>9.22</var>inconsistent in application to a class of customers; or<br />
         		<a id="pl.9.23"></a><var>9.23</var>(3) refunds based on claims that approved rates have not encouraged energy <br />
         		<a id="pl.9.24"></a><var>9.24</var>conservation or renewable energy use, or have not furthered the goals of section 216B.164, <br />
         		<a id="pl.9.25"></a><var>9.25</var>216B.241, or 216C.05.<br />
         		<a id="pl.9.26"></a><var>9.26</var>&nbsp;&nbsp;&nbsp;&nbsp;(c) A refund under this subdivision does not apply to revenues collected more than <br />
         		<a id="pl.9.27"></a><var>9.27</var>six years before the date of the notice of the commission proceeding required under this <br />
         		<a id="pl.9.28"></a><var>9.28</var>subdivision.<br />
         		<br />
         		<a id="bill.0.12.0"></a><a id="pl.9.29"></a><var>9.29</var>&nbsp;&nbsp;&nbsp;&nbsp;Sec. 12. Minnesota Statutes 2008, section 216B.241, subdivision 1c, is amended to <br />
         		<a id="pl.9.30"></a><var>9.30</var>read:<br />
         		<a id="pl.9.31"></a><var>9.31</var>&nbsp;&nbsp;&nbsp;&nbsp;Subd. 1c. <b>Energy-saving goals.</b> (a) The commissioner shall establish energy-saving <br />
         		<a id="pl.9.32"></a><var>9.32</var>goals for energy conservation improvement expenditures and shall evaluate an energy <br />
         		<a id="pl.9.33"></a><var>9.33</var>conservation improvement program on how well it meets the goals set.<br />
         		<a id="pl.10.1"></a><var>10.1</var>&nbsp;&nbsp;&nbsp;&nbsp;(b) Each individual utility and association shall have an annual energy-savings <br />
         		<a id="pl.10.2"></a><var>10.2</var>goal equivalent to 1.5 percent of gross annual retail energy sales unless modified by the <br />
         		<a id="pl.10.3"></a><var>10.3</var>commissioner under paragraph (d). The savings goals must be calculated based on the <br />
         		<a id="pl.10.4"></a><var>10.4</var>most recent three-year weather normalized average. A utility or association may elect to <br />
         		<a id="pl.10.5"></a><var>10.5</var>carry forward energy savings in excess of 1.5 percent for a year to the succeeding three <br />
         		<a id="pl.10.6"></a><var>10.6</var>calendar years, provided that a particular energy savings can apply only to one year's goal.<br />
         		<a id="pl.10.7"></a><var>10.7</var>&nbsp;&nbsp;&nbsp;&nbsp;(c) The commissioner must adopt a filing schedule that is designed to have all <br />
         		<a id="pl.10.8"></a><var>10.8</var>utilities and associations operating under an energy-savings plan by calendar year 2010.<br />
         		<a id="pl.10.9"></a><var>10.9</var>&nbsp;&nbsp;&nbsp;&nbsp;(d) In its energy conservation improvement plan filing, a utility or association may <br />
         		<a id="pl.10.10"></a><var>10.10</var>request the commissioner to adjust its annual energy-savings percentage goal based on <br />
         		<a id="pl.10.11"></a><var>10.11</var>its historical conservation investment experience, customer class makeup, load growth, <br />
         		<a id="pl.10.12"></a><var>10.12</var>a conservation potential study, or other factors the commissioner determines warrants <br />
         		<a id="pl.10.13"></a><var>10.13</var>an adjustment. The commissioner may not approve a plan that provides for an annual <br />
         		<a id="pl.10.14"></a><var>10.14</var>energy-savings goal of less than one percent of gross annual retail energy sales from <br />
         		<a id="pl.10.15"></a><var>10.15</var>energy conservation improvements. <br />
         		<a id="pl.10.16"></a><var>10.16</var>A utility or association may include in its energy conservation plan energy savings <br />
         		<a id="pl.10.17"></a><var>10.17</var>from electric utility infrastructure projects approved by the commission under section <br />
         		
         <statute_ref><a id="pl.10.18"></a><var>10.18</var>216B.1636
         </statute_ref> or waste heat recovery converted into electricity projects that may count as <br />
         		<a id="pl.10.19"></a><var>10.19</var>energy savings in addition to the minimum energy-savings goal of at least one percent for <br />
         		<a id="pl.10.20"></a><var>10.20</var>energy conservation improvements. Electric utility infrastructure projects must result in <br />
         		<a id="pl.10.21"></a><var>10.21</var>increased energy efficiency greater than that which would have occurred through normal <br />
         		<a id="pl.10.22"></a><var>10.22</var>maintenance activity.<br />
         		<a id="pl.10.23"></a><var>10.23</var>&nbsp;&nbsp;&nbsp;&nbsp;(e) An energy-savings goal is not satisfied by attaining the revenue expenditure <br />
         		<a id="pl.10.24"></a><var>10.24</var>requirements of subdivisions 1a and 1b, but can only be satisfied by meeting the <br />
         		<a id="pl.10.25"></a><var>10.25</var>energy-savings goal established in this subdivision.<br />
         		<a id="pl.10.26"></a><var>10.26</var>&nbsp;&nbsp;&nbsp;&nbsp;(f) An association or utility is not required to make energy conservation investments <br />
         		<a id="pl.10.27"></a><var>10.27</var>to attain the energy-savings goals of this subdivision that are not cost-effective even <br />
         		<a id="pl.10.28"></a><var>10.28</var>if the investment is necessary to attain the energy-savings goals. For the purpose of <br />
         		<a id="pl.10.29"></a><var>10.29</var>this paragraph, in determining cost-effectiveness, the commissioner shall consider the <br />
         		<a id="pl.10.30"></a><var>10.30</var>costs and benefits to ratepayers, the utility, participants, and society. In addition, the <br />
         		<a id="pl.10.31"></a><var>10.31</var>commissioner shall consider the rate at which an association or municipal utility is <br />
         		<a id="pl.10.32"></a><var>10.32</var>increasing its energy savings and its expenditures on energy conservation.<br />
         		<a id="pl.10.33"></a><var>10.33</var>&nbsp;&nbsp;&nbsp;&nbsp;(g) On an annual basis, the commissioner shall produce and make publicly available <br />
         		<a id="pl.10.34"></a><var>10.34</var>a report on the annual energy savings and estimated carbon dioxide reductions achieved <br />
         		<a id="pl.10.35"></a><var>10.35</var>by the energy conservation improvement programs for the two most recent years for <br />
         		<a id="pl.10.36"></a><var>10.36</var>which data is available. The commissioner shall report on program performance both in <br />
         		<a id="pl.11.1"></a><var>11.1</var>the aggregate and for each entity filing an energy conservation improvement plan for <br />
         		<a id="pl.11.2"></a><var>11.2</var>approval or review by the commissioner.<br />
         		<a id="pl.11.3"></a><var>11.3</var>&nbsp;&nbsp;&nbsp;&nbsp;(h) By January 15, 2010, the commissioner shall report to the legislature whether <br />
         		<a id="pl.11.4"></a><var>11.4</var>the spending requirements under subdivisions 1a and 1b are necessary to achieve the <br />
         		<a id="pl.11.5"></a><var>11.5</var>energy-savings goals established in this subdivision.<br />
         		<a id="pl.11.6"></a><var>11.6</var><b>EFFECTIVE DATE.</b>This section is effective the day following final enactment.<br />
         		<br />
         		<a id="bill.0.13.0"></a><a id="pl.11.7"></a><var>11.7</var>&nbsp;&nbsp;&nbsp;&nbsp;Sec. 13. Minnesota Statutes 2008, section 216B.241, is amended by adding a <br />
         		<a id="pl.11.8"></a><var>11.8</var>subdivision to read:<br />
         		<a id="pl.11.9"></a><var>11.9</var>&nbsp;&nbsp;&nbsp;&nbsp;Subd. 2d. <b>Renewable residential heating.</b> (a) Up to five percent of a utility's <br />
         		<a id="pl.11.10"></a><var>11.10</var>conservation spending obligation under subdivision 1a or any amount expended in order <br />
         		<a id="pl.11.11"></a><var>11.11</var>to satisfy a utility's energy-savings goal under subdivision 1c may be used for a project <br />
         		<a id="pl.11.12"></a><var>11.12</var>located in this state that provides rebates to homeowners who install the following types of <br />
         		<a id="pl.11.13"></a><var>11.13</var>projects to heat the homeowner's primary residence:<br />
         		<a id="pl.11.14"></a><var>11.14</var>(1) a solar thermal project, as defined in section 216B.2411, subdivision 2, paragraph <br />
         		<a id="pl.11.15"></a><var>11.15</var>(e);<br />
         		<a id="pl.11.16"></a><var>11.16</var>(2) a geothermal project;<br />
         		<a id="pl.11.17"></a><var>11.17</var>(3) a heating unit that burns exclusively either biodiesel, shelled corn, or wood chips <br />
         		<a id="pl.11.18"></a><var>11.18</var>or wood pellets, provided that the heating unit is listed by Underwriters Laboratories.<br />
         		<a id="pl.11.19"></a><var>11.19</var>&nbsp;&nbsp;&nbsp;&nbsp;(b) A rebate awarded under this subdivision must not exceed the lesser of 25 percent <br />
         		<a id="pl.11.20"></a><var>11.20</var>of the purchase and installation costs of the project or $500.<br />
         		<a id="pl.11.21"></a><var>11.21</var><b>EFFECTIVE DATE.</b>This section is effective the day following final enactment.<br />
         		<br />
         		<a id="bill.0.14.0"></a><a id="pl.11.22"></a><var>11.22</var>&nbsp;&nbsp;&nbsp;&nbsp;Sec. 14. Minnesota Statutes 2008, section 216B.241, is amended by adding a <br />
         		<a id="pl.11.23"></a><var>11.23</var>subdivision to read:<br />
         		<a id="pl.11.24"></a><var>11.24</var>&nbsp;&nbsp;&nbsp;&nbsp;Subd. 5b. <b>Biomethane purchases.</b> (a) A natural gas utility may include in its <br />
         		<a id="pl.11.25"></a><var>11.25</var>conservation plan purchases of biomethane, and may use up to five percent of the total <br />
         		<a id="pl.11.26"></a><var>11.26</var>amount to be spent on energy conservation improvements under this section for that <br />
         		<a id="pl.11.27"></a><var>11.27</var>purpose. The cost-effectiveness of biomethane purchases may be determined by a <br />
         		<a id="pl.11.28"></a><var>11.28</var>different standard than for other energy conservation improvements under this section if <br />
         		<a id="pl.11.29"></a><var>11.29</var>the commissioner determines that doing so is in the public interest in order to encourage <br />
         		<a id="pl.11.30"></a><var>11.30</var>biomethane purchases. Energy savings from purchasing biomethane may not be counted <br />
         		<a id="pl.11.31"></a><var>11.31</var>toward the minimum energy-savings goal of at least one percent for energy conservation <br />
         		<a id="pl.11.32"></a><var>11.32</var>improvements required under subdivision 1c, but may, if the conservation plan is approved:<br />
         		<a id="pl.11.33"></a><var>11.33</var>(1) be counted toward energy savings above that minimum percentage; and<br />
         		<a id="pl.12.1"></a><var>12.1</var>(2) be considered when establishing performance incentives under subdivision 2c.<br />
         		<a id="pl.12.2"></a><var>12.2</var>(b) For the purposes of this subdivision, "biomethane" means biogas produced <br />
         		<a id="pl.12.3"></a><var>12.3</var>through anaerobic digestion of biomass, gasification of biomass, or other effective <br />
         		<a id="pl.12.4"></a><var>12.4</var>conversion processes, that is cleaned and purified into biomethane that meets natural gas <br />
         		<a id="pl.12.5"></a><var>12.5</var>utility quality specifications for use in a natural gas utility distribution system.<br />
         		<a id="pl.12.6"></a><var>12.6</var><b>EFFECTIVE DATE.</b>This section is effective the day following final enactment.<br />
         		<br />
         		<a id="bill.0.15.0"></a><a id="pl.12.7"></a><var>12.7</var>&nbsp;&nbsp;&nbsp;&nbsp;Sec. 15. Minnesota Statutes 2008, section 216B.241, subdivision 9, is amended to read:<br />
         		<a id="pl.12.8"></a><var>12.8</var>&nbsp;&nbsp;&nbsp;&nbsp;Subd. 9. <b>Building performance standards; Sustainable Building 2030.</b> (a) The <br />
         		<a id="pl.12.9"></a><var>12.9</var>purpose of this subdivision is to establish cost-effective energy-efficiency performance <br />
         		<a id="pl.12.10"></a><var>12.10</var>standards for new and substantially reconstructed commercial, industrial, and institutional <br />
         		<a id="pl.12.11"></a><var>12.11</var>buildings that can significantly reduce carbon dioxide emissions by lowering energy use in <br />
         		<a id="pl.12.12"></a><var>12.12</var>new and substantially reconstructed buildings. For the purposes of this subdivision, the <br />
         		<a id="pl.12.13"></a><var>12.13</var>establishment of these standards may be referred to as Sustainable Building 2030.<br />
         		<a id="pl.12.14"></a><var>12.14</var>&nbsp;&nbsp;&nbsp;&nbsp;(b) The commissioner shall contract with the Center for Sustainable Building <br />
         		<a id="pl.12.15"></a><var>12.15</var>Research at the University of Minnesota to coordinate development and implementation <br />
         		<a id="pl.12.16"></a><var>12.16</var>of energy-efficiency performance standards, strategic planning, research, data analysis, <br />
         		<a id="pl.12.17"></a><var>12.17</var>technology transfer, training, and other activities related to the purpose of Sustainable <br />
         		<a id="pl.12.18"></a><var>12.18</var>Building 2030. The commissioner and the Center for Sustainable Building Research <br />
         		<a id="pl.12.19"></a><var>12.19</var>shall, in consultation with utilities, builders, developers, building operators, and experts <br />
         		<a id="pl.12.20"></a><var>12.20</var>in building design and technology, develop a Sustainable Building 2030 implementation <br />
         		<a id="pl.12.21"></a><var>12.21</var>plan that must address, at a minimum, the following issues:<br />
         		<a id="pl.12.22"></a><var>12.22</var>&nbsp;&nbsp;&nbsp;&nbsp;(1) training architects to incorporate the performance standards in building design;<br />
         		<a id="pl.12.23"></a><var>12.23</var>&nbsp;&nbsp;&nbsp;&nbsp;(2) incorporating the performance standards in utility conservation improvement <br />
         		<a id="pl.12.24"></a><var>12.24</var>programs; and<br />
         		<a id="pl.12.25"></a><var>12.25</var>&nbsp;&nbsp;&nbsp;&nbsp;(3) developing procedures for ongoing monitoring of energy use in buildings that <br />
         		<a id="pl.12.26"></a><var>12.26</var>have adopted the performance standards.<br />
         		<a id="pl.12.27"></a><var>12.27</var>The plan must be submitted to the chairs and ranking minority members of the senate and <br />
         		<a id="pl.12.28"></a><var>12.28</var>house of representatives committees with primary jurisdiction over energy policy by <br />
         		<a id="pl.12.29"></a><var>12.29</var>July 1, 2009.<br />
         		<a id="pl.12.30"></a><var>12.30</var>&nbsp;&nbsp;&nbsp;&nbsp;(c) Sustainable Building 2030 energy-efficiency performance standards must be firm, <br />
         		<a id="pl.12.31"></a><var>12.31</var>quantitative measures of total building energy use and associated carbon dioxide emissions <br />
         		<a id="pl.12.32"></a><var>12.32</var>per square foot for different building types and uses, that allow for accurate determinations <br />
         		<a id="pl.12.33"></a><var>12.33</var>of a building's conformance with a performance standard. The energy-efficiency <br />
         		<a id="pl.12.34"></a><var>12.34</var>performance standards must be updated every three or five years to incorporate all <br />
         		<a id="pl.13.1"></a><var>13.1</var>cost-effective measures. The performance standards must reflect the reductions in carbon <br />
         		<a id="pl.13.2"></a><var>13.2</var>dioxide emissions per square foot resulting from actions taken by utilities to comply <br />
         		<a id="pl.13.3"></a><var>13.3</var>with the renewable energy standards in section 
         <statute_ref>216B.1691</statute_ref>. The performance standards <br />
         		<a id="pl.13.4"></a><var>13.4</var>should be designed to achieve reductions equivalent to the following reduction schedule, <br />
         		<a id="pl.13.5"></a><var>13.5</var>measured against energy consumption by an average building in each applicable building <br />
         		<a id="pl.13.6"></a><var>13.6</var>sector in 2003: (1) 60 percent in 2010; (2) 70 percent in 2015; (3) 80 percent in 2020; <br />
         		<a id="pl.13.7"></a><var>13.7</var>and (4) 90 percent in 2025. A performance standard must not be established or increased <br />
         		<a id="pl.13.8"></a><var>13.8</var>absent a conclusive engineering analysis that it is cost-effective based upon established <br />
         		<a id="pl.13.9"></a><var>13.9</var>practices used in evaluating utility conservation improvement programs.<br />
         		<a id="pl.13.10"></a><var>13.10</var>&nbsp;&nbsp;&nbsp;&nbsp;(d) The annual amount of the contract with the Center for Sustainable Building <br />
         		<a id="pl.13.11"></a><var>13.11</var>Research is up to $500,000. The Center for Sustainable Building Research shall expend <br />
         		<a id="pl.13.12"></a><var>13.12</var>no more than $150,000 of this amount each year on administration, coordination, and <br />
         		<a id="pl.13.13"></a><var>13.13</var>oversight activities related to Sustainable Building 2030. The balance of contract funds <br />
         		<a id="pl.13.14"></a><var>13.14</var>must be spent on substantive programmatic activities allowed under this subdivision <br />
         		<a id="pl.13.15"></a><var>13.15</var>that may be conducted by the Center for Sustainable Building Research and for <br />
         		<a id="pl.13.16"></a><var>13.16</var>subcontracts with not-for-profit energy organizations, architecture and engineering firms, <br />
         		<a id="pl.13.17"></a><var>13.17</var>and other qualified entities to undertake technical projects and activities in support of <br />
         		<a id="pl.13.18"></a><var>13.18</var>Sustainable Building 2030. The primary work to be accomplished each year by qualified <br />
         		<a id="pl.13.19"></a><var>13.19</var>technical experts under subcontracts is the development and thorough justification of <br />
         		<a id="pl.13.20"></a><var>13.20</var>recommendations for specific energy-efficiency performance standards. Additional work <br />
         		<a id="pl.13.21"></a><var>13.21</var>may include:<br />
         		<a id="pl.13.22"></a><var>13.22</var>&nbsp;&nbsp;&nbsp;&nbsp;(1) research, development, and demonstration of new energy-efficiency technologies <br />
         		<a id="pl.13.23"></a><var>13.23</var>and techniques suitable for commercial, industrial, and institutional buildings;<br />
         		<a id="pl.13.24"></a><var>13.24</var>&nbsp;&nbsp;&nbsp;&nbsp;(2) analysis and evaluation of practices in building design, construction, <br />
         		<a id="pl.13.25"></a><var>13.25</var>commissioning and operations, and analysis and evaluation of energy use in the <br />
         		<a id="pl.13.26"></a><var>13.26</var>commercial, industrial, and institutional sectors;<br />
         		<a id="pl.13.27"></a><var>13.27</var>&nbsp;&nbsp;&nbsp;&nbsp;(3) analysis and evaluation of the effectiveness and cost-effectiveness of Sustainable <br />
         		<a id="pl.13.28"></a><var>13.28</var>Building 2030 performance standards, conservation improvement programs, and building <br />
         		<a id="pl.13.29"></a><var>13.29</var>energy codes;<br />
         		<a id="pl.13.30"></a><var>13.30</var>&nbsp;&nbsp;&nbsp;&nbsp;(4) development and delivery of training programs for architects, engineers, <br />
         		<a id="pl.13.31"></a><var>13.31</var>commissioning agents, technicians, contractors, equipment suppliers, developers, and <br />
         		<a id="pl.13.32"></a><var>13.32</var>others in the building industries; and<br />
         		<a id="pl.13.33"></a><var>13.33</var>&nbsp;&nbsp;&nbsp;&nbsp;(5) analyze and evaluate the effect of building operations on energy use. <br />
         		<a id="pl.13.34"></a><var>13.34</var>&nbsp;&nbsp;&nbsp;&nbsp;(e) The commissioner shall require utilities to develop and implement conservation <br />
         		<a id="pl.13.35"></a><var>13.35</var>improvement programs that are expressly designed to achieve energy efficiency goals <br />
         		<a id="pl.13.36"></a><var>13.36</var>consistent with the Sustainable Building 2030 performance standards. These programs <br />
         		<a id="pl.14.1"></a><var>14.1</var>must include offerings of design assistance and modeling, financial incentives, and the <br />
         		<a id="pl.14.2"></a><var>14.2</var>verification of the proper installation of energy-efficient design components in new and <br />
         		<a id="pl.14.3"></a><var>14.3</var>substantially reconstructed buildings. A utility's design assistance program must consider <br />
         		<a id="pl.14.4"></a><var>14.4</var>the strategic planting of trees and shrubs around buildings as an energy conservation <br />
         		<a id="pl.14.5"></a><var>14.5</var>strategy for the designed project. A utility making an expenditure under its conservation <br />
         		<a id="pl.14.6"></a><var>14.6</var>improvement program that results in a building meeting the Sustainable Building 2030 <br />
         		<a id="pl.14.7"></a><var>14.7</var>performance standards may claim the energy savings toward its energy-savings goal <br />
         		<a id="pl.14.8"></a><var>14.8</var>established in subdivision 1c.<br />
         		<a id="pl.14.9"></a><var>14.9</var>&nbsp;&nbsp;&nbsp;&nbsp;(f) The commissioner shall report to the legislature every three years, beginning <br />
         		<a id="pl.14.10"></a><var>14.10</var>January 15, 2010, on the cost-effectiveness and progress of implementing the Sustainable <br />
         		<a id="pl.14.11"></a><var>14.11</var>Building 2030 performance standards and shall make recommendations on the need to <br />
         		<a id="pl.14.12"></a><var>14.12</var>continue the program as described in this section.<br />
         		<a id="pl.14.13"></a><var>14.13</var><b>EFFECTIVE DATE.</b>This section is effective the day following final enactment.<br />
         		<br />
         		<a id="bill.0.16.0"></a><a id="pl.14.14"></a><var>14.14</var>&nbsp;&nbsp;&nbsp;&nbsp;Sec. 16. Minnesota Statutes 2008, section 216B.2411, subdivision 1, is amended to <br />
         		<a id="pl.14.15"></a><var>14.15</var>read:<br />
         		<a id="pl.14.16"></a><var>14.16</var>&nbsp;&nbsp;&nbsp;&nbsp;Subdivision 1.  <b>Generation projects.</b> (a) Any municipality or rural electric <br />
         		<a id="pl.14.17"></a><var>14.17</var>association providing electric service and subject to section 
         <statute_ref>216B.241</statute_ref> may, and each <br />
         		<a id="pl.14.18"></a><var>14.18</var>public utility may, use five percent of the total amount to be spent on energy conservation <br />
         		<a id="pl.14.19"></a><var>14.19</var>improvements under section 
         <statute_ref>216B.241</statute_ref>, on: <br />
         		<a id="pl.14.20"></a><var>14.20</var>&nbsp;&nbsp;&nbsp;&nbsp;(1) projects in Minnesota to construct an electric generating facility that utilizes <br />
         		<a id="pl.14.21"></a><var>14.21</var>eligible renewable energy sources as defined in subdivision 2, such as methane or other <br />
         		<a id="pl.14.22"></a><var>14.22</var>combustible gases derived from the processing of plant or animal wastes, biomass fuels <br />
         		<a id="pl.14.23"></a><var>14.23</var>such as short-rotation woody or fibrous agricultural crops, or other renewable fuel, as <br />
         		<a id="pl.14.24"></a><var>14.24</var>its primary fuel source; <br />
         		<a id="pl.14.25"></a><var>14.25</var>&nbsp;&nbsp;&nbsp;&nbsp;(2) projects in Minnesota to install a distributed generation facility of ten megawatts <br />
         		<a id="pl.14.26"></a><var>14.26</var>or less of interconnected capacity that is fueled by natural gas, renewable fuels, or another <br />
         		<a id="pl.14.27"></a><var>14.27</var>similarly clean fuel; or <br />
         		<a id="pl.14.28"></a><var>14.28</var>&nbsp;&nbsp;&nbsp;&nbsp;(3) projects in Minnesota to install a qualifying solar energy project as defined in <br />
         		<a id="pl.14.29"></a><var>14.29</var>subdivision 2. <br />
         		<a id="pl.14.30"></a><var>14.30</var>&nbsp;&nbsp;&nbsp;&nbsp;(b) A utility that offers a program to customers to promote installing qualifying solar <br />
         		<a id="pl.14.31"></a><var>14.31</var>energy projects may request authority from the commissioner to exceed the five percent <br />
         		<a id="pl.14.32"></a><var>14.32</var>limit in paragraph (a) to meet customer demand for installation of qualifying solar energy <br />
         		<a id="pl.14.33"></a><var>14.33</var>projects. In considering this request, the commissioner shall consider customer interest in <br />
         		<a id="pl.14.34"></a><var>14.34</var>qualifying solar energy and the impact on other customers.<br />
         		<a id="pl.15.1"></a><var>15.1</var>~~For public utilities, as defined under section~~ 
         <statute_ref>~~216B.02, subdivision 4~~</statute_ref>~~,~~ (c) For a utility <br />
         		<a id="pl.15.2"></a><var>15.2</var>subject to this section, projects under this section must be considered energy conservation <br />
         		<a id="pl.15.3"></a><var>15.3</var>improvements as defined in section 
         <statute_ref>216B.241</statute_ref>. ~~For cooperative electric associations and~~ <br />
         		<a id="pl.15.4"></a><var>15.4</var>~~municipal utilities, projects under this section must be considered load-management~~ <br />
         		<a id="pl.15.5"></a><var>15.5</var>~~activities described in section~~ 
         <statute_ref>~~216B.241, subdivision 1~~</statute_ref>~~.~~<br />
         		<br />
         		<a id="bill.0.17.0"></a><a id="pl.15.6"></a><var>15.6</var>&nbsp;&nbsp;&nbsp;&nbsp;Sec. 17. Minnesota Statutes 2008, section 216B.2411, subdivision 2, is amended to <br />
         		<a id="pl.15.7"></a><var>15.7</var>read:<br />
         		<a id="pl.15.8"></a><var>15.8</var>&nbsp;&nbsp;&nbsp;&nbsp;Subd. 2.  <b>Definitions.</b> (a) For the purposes of this section, the terms defined in this <br />
         		<a id="pl.15.9"></a><var>15.9</var>subdivision and section 
         <statute_ref>216B.241, subdivision 1</statute_ref>, have the meanings given them. <br />
         		<a id="pl.15.10"></a><var>15.10</var>&nbsp;&nbsp;&nbsp;&nbsp;(b) "Eligible renewable energy sources" means fuels and technologies to generate <br />
         		<a id="pl.15.11"></a><var>15.11</var>electricity through the use of any of the resources listed in section 
         <statute_ref>216B.1691, subdivision <br />
            		<a id="pl.15.12"></a><var>15.12</var>1
         </statute_ref>, paragraph (a), except that the incineration of wastewater sludge is not an eligible <br />
         		<a id="pl.15.13"></a><var>15.13</var>renewable energy source, "biomass" has the meaning provided under paragraph (c), and <br />
         		<a id="pl.15.14"></a><var>15.14</var>"solar" must be from a qualified solar energy project as defined in paragraph (d). <br />
         		<a id="pl.15.15"></a><var>15.15</var>&nbsp;&nbsp;&nbsp;&nbsp;(c) "Biomass" includes: <br />
         		<a id="pl.15.16"></a><var>15.16</var>&nbsp;&nbsp;&nbsp;&nbsp;(1) methane or other combustible gases derived from the processing of plant or <br />
         		<a id="pl.15.17"></a><var>15.17</var>animal material; <br />
         		<a id="pl.15.18"></a><var>15.18</var>&nbsp;&nbsp;&nbsp;&nbsp;(2) alternative fuels derived from soybean and other agricultural plant oils or animal <br />
         		<a id="pl.15.19"></a><var>15.19</var>fats; <br />
         		<a id="pl.15.20"></a><var>15.20</var>&nbsp;&nbsp;&nbsp;&nbsp;(3) combustion of barley hulls, corn, soy-based products, or other agricultural <br />
         		<a id="pl.15.21"></a><var>15.21</var>products; <br />
         		<a id="pl.15.22"></a><var>15.22</var>&nbsp;&nbsp;&nbsp;&nbsp;(4) wood residue from the wood products industry in Minnesota or other wood <br />
         		<a id="pl.15.23"></a><var>15.23</var>products such as short-rotation woody or fibrous agricultural crops; <br />
         		<a id="pl.15.24"></a><var>15.24</var>&nbsp;&nbsp;&nbsp;&nbsp;(5) landfill gas;<br />
         		<a id="pl.15.25"></a><var>15.25</var>(6) the predominantly organic components of wastewater effluent, sludge, or related <br />
         		<a id="pl.15.26"></a><var>15.26</var>byproducts from publicly owned treatment works; and <br />
         		<a id="pl.15.27"></a><var>15.27</var>(7) mixed municipal solid waste, and refuse-derived fuel from mixed municipal <br />
         		<a id="pl.15.28"></a><var>15.28</var>solid waste. <br />
         		<a id="pl.15.29"></a><var>15.29</var>&nbsp;&nbsp;&nbsp;&nbsp;(d) "Qualifying solar energy project" means a qualifying solar thermal project or <br />
         		<a id="pl.15.30"></a><var>15.30</var>qualifying solar electric project. <br />
         		<a id="pl.15.31"></a><var>15.31</var>&nbsp;&nbsp;&nbsp;&nbsp;(e) "Qualifying solar thermal project" means a flat plate or evacuated tube that meets <br />
         		<a id="pl.15.32"></a><var>15.32</var>the requirements of section 
         <statute_ref>216C.25</statute_ref> with a fixed orientation that collects the sun's radiant <br />
         		<a id="pl.15.33"></a><var>15.33</var>energy and transfers it to a storage medium for distribution as energy to heat or cool air or <br />
         		<a id="pl.15.34"></a><var>15.34</var>water, but does not include equipment used to heat water at a residential property (1) for <br />
         		<a id="pl.16.1"></a><var>16.1</var>domestic use if less than one-half of the energy used for that purpose is derived from the <br />
         		<a id="pl.16.2"></a><var>16.2</var>sun or (2) for use in a hot tub or swimming pool. <br />
         		<a id="pl.16.3"></a><var>16.3</var>&nbsp;&nbsp;&nbsp;&nbsp;(f) "Qualifying solar electric project" means:<br />
         		<a id="pl.16.4"></a><var>16.4</var>(1) solar electric equipment that: (i) meets the requirements of section 
         <statute_ref>216C.25</statute_ref> <br />
         		<a id="pl.16.5"></a><var>16.5</var>~~with a total~~; (ii) has a peak generating capacity of 100 kilowatts or less; and (iii) is <br />
         		<a id="pl.16.6"></a><var>16.6</var>used ~~for generating~~ to generate electricity ~~primarily~~ for use in a residential ~~property or~~ <br />
         		<a id="pl.16.7"></a><var>16.7</var>~~small business to reduce the effective electric load for that residence or small business~~, <br />
         		<a id="pl.16.8"></a><var>16.8</var>commercial, or publicly owned building or facility; and<br />
         		<a id="pl.16.9"></a><var>16.9</var>(2) if applicable, equipment that is used to store the electricity generated by a <br />
         		<a id="pl.16.10"></a><var>16.10</var>qualified solar electric project under clause (1) and that is located proximate to the <br />
         		<a id="pl.16.11"></a><var>16.11</var>building or facility using the electricity. <br />
         		<a id="pl.16.12"></a><var>16.12</var>&nbsp;&nbsp;&nbsp;&nbsp;(g) "Residential ~~property~~ building" means the principal residence of a homeowner at <br />
         		<a id="pl.16.13"></a><var>16.13</var>the time the solar equipment is placed in service. <br />
         		<a id="pl.16.14"></a><var>16.14</var>&nbsp;&nbsp;&nbsp;&nbsp;~~(h) "Small business" has the meaning given to it in section~~ 
         <statute_ref>~~645.445~~</statute_ref>~~.~~ <br />
         		<a id="pl.16.15"></a><var>16.15</var><b>EFFECTIVE DATE.</b>This section is effective the day following final enactment.<br />
         		<br />
         		<a id="bill.0.18.0"></a><a id="pl.16.16"></a><var>16.16</var>&nbsp;&nbsp;&nbsp;&nbsp;Sec. 18. Minnesota Statutes 2008, section 216B.2424, subdivision 5a, is amended to <br />
         		<a id="pl.16.17"></a><var>16.17</var>read:<br />
         		<a id="pl.16.18"></a><var>16.18</var>&nbsp;&nbsp;&nbsp;&nbsp;Subd. 5a. <b>Reduction of biomass mandate.</b> (a) Notwithstanding subdivision 5, the <br />
         		<a id="pl.16.19"></a><var>16.19</var>biomass electric energy mandate must be reduced from 125 megawatts to 110 megawatts.<br />
         		<a id="pl.16.20"></a><var>16.20</var>(b) The Public Utilities Commission shall approve a request pending before the <br />
         		<a id="pl.16.21"></a><var>16.21</var>commission as of May 15, 2003, for amendments to and assignment of a power purchase <br />
         		<a id="pl.16.22"></a><var>16.22</var>agreement with the owner of a facility that uses short-rotation, woody crops as its primary <br />
         		<a id="pl.16.23"></a><var>16.23</var>fuel previously approved to satisfy a portion of the biomass mandate if the owner of <br />
         		<a id="pl.16.24"></a><var>16.24</var>the project agrees to reduce the size of its project from 50 megawatts to 35 megawatts, <br />
         		<a id="pl.16.25"></a><var>16.25</var>while maintaining an average price for energy in nominal dollars measured over the term <br />
         		<a id="pl.16.26"></a><var>16.26</var>of the power purchase agreement at or below $104 per megawatt-hour, exclusive of any <br />
         		<a id="pl.16.27"></a><var>16.27</var>price adjustments that may take effect subsequent to commission approval of the power <br />
         		<a id="pl.16.28"></a><var>16.28</var>purchase agreement, as amended. The commission shall also approve, as necessary, any <br />
         		<a id="pl.16.29"></a><var>16.29</var>subsequent assignment or sale of the power purchase agreement or ownership of the <br />
         		<a id="pl.16.30"></a><var>16.30</var>project to an entity owned or controlled, directly or indirectly, by two municipal utilities <br />
         		<a id="pl.16.31"></a><var>16.31</var>located north of Constitutional Route No. 8, as described in section 
         <statute_ref>161.114</statute_ref>, which <br />
         		<a id="pl.16.32"></a><var>16.32</var>currently own electric and steam generation facilities using coal as a fuel and which <br />
         		<a id="pl.16.33"></a><var>16.33</var>propose to retrofit their existing municipal electrical generating facilities to utilize biomass <br />
         		<a id="pl.16.34"></a><var>16.34</var>fuels in order to perform the power purchase agreement.<br />
         		<a id="pl.17.1"></a><var>17.1</var>(c) If the power purchase agreement described in paragraph (b) is assigned to an <br />
         		<a id="pl.17.2"></a><var>17.2</var>entity that is, or becomes, owned or controlled, directly or indirectly, by two municipal <br />
         		<a id="pl.17.3"></a><var>17.3</var>entities as described in paragraph (b), and the power purchase agreement meets the <br />
         		<a id="pl.17.4"></a><var>17.4</var>price requirements of paragraph (b), the commission shall approve any amendments to <br />
         		<a id="pl.17.5"></a><var>17.5</var>the power purchase agreement necessary to reflect the changes in project location and <br />
         		<a id="pl.17.6"></a><var>17.6</var>ownership and any other amendments made necessary by those changes. The commission <br />
         		<a id="pl.17.7"></a><var>17.7</var>shall also specifically find that:<br />
         		<a id="pl.17.8"></a><var>17.8</var>(1) the power purchase agreement complies with and fully satisfies the provisions of <br />
         		<a id="pl.17.9"></a><var>17.9</var>this section to the full extent of its 35-megawatt capacity;<br />
         		<a id="pl.17.10"></a><var>17.10</var>(2) all costs incurred by the public utility and all amounts to be paid by the public <br />
         		<a id="pl.17.11"></a><var>17.11</var>utility to the project owner under the terms of the power purchase agreement are fully <br />
         		<a id="pl.17.12"></a><var>17.12</var>recoverable pursuant to section 
         <statute_ref>216B.1645</statute_ref>;<br />
         		<a id="pl.17.13"></a><var>17.13</var>(3) subject to prudency review by the commission, the public utility may recover <br />
         		<a id="pl.17.14"></a><var>17.14</var>from its Minnesota retail customers the Minnesota jurisdictional portion of the amounts <br />
         		<a id="pl.17.15"></a><var>17.15</var>that may be incurred and paid by the public utility during the full term of the power <br />
         		<a id="pl.17.16"></a><var>17.16</var>purchase agreement; and<br />
         		<a id="pl.17.17"></a><var>17.17</var>(4) if the purchase power agreement meets the requirements of this subdivision, <br />
         		<a id="pl.17.18"></a><var>17.18</var>it is reasonable and in the public interest.<br />
         		<a id="pl.17.19"></a><var>17.19</var>(d) The commission shall specifically approve recovery by the public utility of <br />
         		<a id="pl.17.20"></a><var>17.20</var>any and all Minnesota jurisdictional costs incurred by the public utility to improve, <br />
         		<a id="pl.17.21"></a><var>17.21</var>construct, install, or upgrade transmission, distribution, or other electrical facilities owned <br />
         		<a id="pl.17.22"></a><var>17.22</var>by the public utility or other persons in order to permit interconnection of the retrofitted <br />
         		<a id="pl.17.23"></a><var>17.23</var>biomass-fueled generating facilities or to obtain transmission service for the energy <br />
         		<a id="pl.17.24"></a><var>17.24</var>provided by the facilities to the public utility pursuant to section 
         <statute_ref>216B.1645</statute_ref>, and shall <br />
         		<a id="pl.17.25"></a><var>17.25</var>disapprove any provision in the power purchase agreement that requires the developer <br />
         		<a id="pl.17.26"></a><var>17.26</var>or owner of the project to pay the jurisdictional costs or that permit the public utility to <br />
         		<a id="pl.17.27"></a><var>17.27</var>terminate the power purchase agreement as a result of the existence of those costs or the <br />
         		<a id="pl.17.28"></a><var>17.28</var>public utility's obligation to pay any or all of those costs.<br />
         		<a id="pl.17.29"></a><var>17.29</var>(e) Upon request by the project owner, the public utility shall agree to amend the <br />
         		<a id="pl.17.30"></a><var>17.30</var>power purchase agreement described in paragraph (b) and approved by the commission <br />
         		<a id="pl.17.31"></a><var>17.31</var>as required by paragraph (c). The amendment must be negotiated and executed within <br />
         		<a id="pl.17.32"></a><var>17.32</var>45 days of the effective date of this section and must apply to prices paid after January <br />
         		<a id="pl.17.33"></a><var>17.33</var>1, 2009. The average price for energy in nominal dollars measured over the term of the <br />
         		<a id="pl.17.34"></a><var>17.34</var>power purchase agreement must not exceed $104 per megawatt hour by more than five <br />
         		<a id="pl.17.35"></a><var>17.35</var>percent. The public utility shall request approval of the amendment by the commission <br />
         		<a id="pl.17.36"></a><var>17.36</var>within 30 days of execution of the amended power purchase agreement. The amendment <br />
         		<a id="pl.18.1"></a><var>18.1</var>is not effective until approval by the commission. The commission shall act on the <br />
         		<a id="pl.18.2"></a><var>18.2</var>amendment within 90 days of submission of the request by the public utility. Upon <br />
         		<a id="pl.18.3"></a><var>18.3</var>approval of the amended power purchase agreement, the commission shall allow the <br />
         		<a id="pl.18.4"></a><var>18.4</var>public utility to recover the costs of the amended power purchase agreement, as provided <br />
         		<a id="pl.18.5"></a><var>18.5</var>in section 216B.1645.<br />
         		<a id="pl.18.6"></a><var>18.6</var><b>EFFECTIVE DATE.</b>This section is effective the day following final enactment.<br />
         		<br />
         		<a id="bill.0.19.0"></a><a id="pl.18.7"></a><var>18.7</var>&nbsp;&nbsp;&nbsp;&nbsp;Sec. 19. Minnesota Statutes 2008, section 216B.2425, subdivision 3, is amended to <br />
         		<a id="pl.18.8"></a><var>18.8</var>read:<br />
         		<a id="pl.18.9"></a><var>18.9</var>&nbsp;&nbsp;&nbsp;&nbsp;Subd. 3. <b>Commission approval</b><b>; order</b><b>.</b> (a) By June 1 of each even-numbered <br />
         		<a id="pl.18.10"></a><var>18.10</var>year, the commission shall adopt a state transmission project list and shall certify, certify <br />
         		<a id="pl.18.11"></a><var>18.11</var>as modified, or deny certification of the projects proposed under subdivision 2. The <br />
         		<a id="pl.18.12"></a><var>18.12</var>commission may only certify a project that is a high-voltage transmission line as defined <br />
         		<a id="pl.18.13"></a><var>18.13</var>in section 
         <statute_ref>216B.2421, subdivision 2</statute_ref>, that the commission finds is: <br />
         		<a id="pl.18.14"></a><var>18.14</var>(1) necessary to maintain or enhance the reliability of electric service to Minnesota <br />
         		<a id="pl.18.15"></a><var>18.15</var>consumers;<br />
         		<a id="pl.18.16"></a><var>18.16</var>(2) needed, applying the criteria in section 
         <statute_ref>216B.243, subdivision 3</statute_ref>; and <br />
         		<a id="pl.18.17"></a><var>18.17</var>(3) in the public interest, taking into account electric energy system needs and <br />
         		<a id="pl.18.18"></a><var>18.18</var>economic, environmental, and social interests affected by the project.<br />
         		<a id="pl.18.19"></a><var>18.19</var>(b) In its order adopting a statewide transmission project list, the commission shall <br />
         		<a id="pl.18.20"></a><var>18.20</var>summarize the present and future inadequacies of the transmission system identified in <br />
         		<a id="pl.18.21"></a><var>18.21</var>the utilities' transmission project reports, plans to address those inadequacies, and any <br />
         		<a id="pl.18.22"></a><var>18.22</var>barriers that may prevent those inadequacies from being addressed. Within ten days of <br />
         		<a id="pl.18.23"></a><var>18.23</var>issuing the order, the commission shall send a copy of the order to the chairs and ranking <br />
         		<a id="pl.18.24"></a><var>18.24</var>minority members of the senate and house of representatives committees with primary <br />
         		<a id="pl.18.25"></a><var>18.25</var>jurisdiction over energy policy.<br />
         		<br />
         		<a id="bill.0.20.0"></a><a id="pl.18.26"></a><var>18.26</var>&nbsp;&nbsp;&nbsp;&nbsp;Sec. 20. Minnesota Statutes 2008, section 216B.243, subdivision 8, is amended to read:<br />
         		<a id="pl.18.27"></a><var>18.27</var>&nbsp;&nbsp;&nbsp;&nbsp;Subd. 8. <b>Exemptions.</b> This section does not apply to:<br />
         		<a id="pl.18.28"></a><var>18.28</var>(1) cogeneration or small power production facilities as defined in the Federal Power <br />
         		<a id="pl.18.29"></a><var>18.29</var>Act, United States Code, title 16, section 796, paragraph (17), subparagraph (A), and <br />
         		<a id="pl.18.30"></a><var>18.30</var>paragraph (18), subparagraph (A), and having a combined capacity at a single site of less <br />
         		<a id="pl.18.31"></a><var>18.31</var>than 80,000 kilowatts; plants or facilities for the production of ethanol or fuel alcohol; or <br />
         		<a id="pl.18.32"></a><var>18.32</var>any case where the commission has determined after being advised by the attorney general <br />
         		<a id="pl.18.33"></a><var>18.33</var>that its application has been preempted by federal law;<br />
         		<a id="pl.19.1"></a><var>19.1</var>(2) a high-voltage transmission line proposed primarily to distribute electricity to <br />
         		<a id="pl.19.2"></a><var>19.2</var>serve the demand of a single customer at a single location, unless the applicant opts to <br />
         		<a id="pl.19.3"></a><var>19.3</var>request that the commission determine need under this section or section 
         <statute_ref>216B.2425</statute_ref>;<br />
         		<a id="pl.19.4"></a><var>19.4</var>(3) the upgrade to a higher voltage of an existing transmission line that serves <br />
         		<a id="pl.19.5"></a><var>19.5</var>the demand of a single customer that primarily uses existing rights-of-way, unless the <br />
         		<a id="pl.19.6"></a><var>19.6</var>applicant opts to request that the commission determine need under this section or section <br />
         		
         <statute_ref><a id="pl.19.7"></a><var>19.7</var>216B.2425
         </statute_ref>;<br />
         		<a id="pl.19.8"></a><var>19.8</var>(4) a high-voltage transmission line of one mile or less required to connect a new or <br />
         		<a id="pl.19.9"></a><var>19.9</var>upgraded substation to an existing, new, or upgraded high-voltage transmission line;<br />
         		<a id="pl.19.10"></a><var>19.10</var>(5) conversion of the fuel source of an existing electric generating plant to using <br />
         		<a id="pl.19.11"></a><var>19.11</var>natural gas;<br />
         		<a id="pl.19.12"></a><var>19.12</var>(6) the modification of an existing electric generating plant to increase efficiency, <br />
         		<a id="pl.19.13"></a><var>19.13</var>as long as the capacity of the plant is not increased more than ten percent or more than <br />
         		<a id="pl.19.14"></a><var>19.14</var>100 megawatts, whichever is greater; or<br />
         		<a id="pl.19.15"></a><var>19.15</var>(7) a large energy facility that: <br />
         		<a id="pl.19.16"></a><var>19.16</var>(i) generates electricity from wind energy conversion systems~~,~~; <br />
         		<a id="pl.19.17"></a><var>19.17</var>(ii) will serve retail customers in Minnesota~~,~~; and <br />
         		<a id="pl.19.18"></a><var>19.18</var>(iii) meets any of the following conditions:<br />
         		<a id="pl.19.19"></a><var>19.19</var>(A) is specifically intended to be used to meet the renewable energy objective under <br />
         		<a id="pl.19.20"></a><var>19.20</var>section 
         <statute_ref>216B.1691</statute_ref> ~~or~~; <br />
         		<a id="pl.19.21"></a><var>19.21</var>(B)  addresses a resource need identified in a current commission-approved or <br />
         		<a id="pl.19.22"></a><var>19.22</var>commission-reviewed resource plan under section 
         <statute_ref>216B.2422</statute_ref>~~,  and (iv)~~; or<br />
         		<a id="pl.19.23"></a><var>19.23</var>(C) derives at least ten percent of the total nameplate capacity of the proposed project <br />
         		<a id="pl.19.24"></a><var>19.24</var>from one or more C-BED projects, as defined under section 
         <statute_ref>216B.1612, subdivision 2, <br />
            		<a id="pl.19.25"></a><var>19.25</var>paragraph (f)
         </statute_ref>.<br />
         		<br />
         		<a id="bill.0.21.0"></a><a id="pl.19.26"></a><var>19.26</var>&nbsp;&nbsp;&nbsp;&nbsp;Sec. 21. Minnesota Statutes 2008, section 216B.243, subdivision 9, is amended to read:<br />
         		<a id="pl.19.27"></a><var>19.27</var>&nbsp;&nbsp;&nbsp;&nbsp;Subd. 9.  <b>Renewable energy standard facilities.</b> The requirements of this section <br />
         		<a id="pl.19.28"></a><var>19.28</var>do not apply to a wind energy conversion system or a solar electric generation facility that <br />
         		<a id="pl.19.29"></a><var>19.29</var>is intended to be used to meet or exceed the obligations of section 
         <statute_ref>216B.1691</statute_ref>; provided <br />
         		<a id="pl.19.30"></a><var>19.30</var>that, after notice and comment, the commission determines that the facility is a reasonable <br />
         		<a id="pl.19.31"></a><var>19.31</var>and prudent approach to meeting a utility's obligations under that section. When making <br />
         		<a id="pl.19.32"></a><var>19.32</var>this determination, the commission may consider:<br />
         		<a id="pl.19.33"></a><var>19.33</var>(1) the size of the facility relative to a utility's total need for renewable resources ~~and~~;<br />
         		<a id="pl.19.34"></a><var>19.34</var>(2) alternative approaches for supplying the renewable energy to be supplied by <br />
         		<a id="pl.19.35"></a><var>19.35</var>the proposed facility~~, and must consider~~;<br />
         		<a id="pl.20.1"></a><var>20.1</var>(3) the facility's ability to promote economic development, as required under section <br />
         		
         <statute_ref><a id="pl.20.2"></a><var>20.2</var>216B.1691
         </statute_ref>, subdivision 9~~, maintain~~;<br />
         		<a id="pl.20.3"></a><var>20.3</var>(4) maintenance of electric system reliability ~~and consider~~;<br />
         		<a id="pl.20.4"></a><var>20.4</var>(5) impacts on ratepayers~~,~~ ; and <br />
         		<a id="pl.20.5"></a><var>20.5</var>(6) other criteria ~~as~~ that the commission ~~may determine~~ determines are relevant. <br />
         		<br />
         		<a id="bill.0.22.0"></a><a id="pl.20.6"></a><var>20.6</var>&nbsp;&nbsp;&nbsp;&nbsp;Sec. 22. Minnesota Statutes 2008, section 216C.052, subdivision 2, is amended to read:<br />
         		<a id="pl.20.7"></a><var>20.7</var>&nbsp;&nbsp;&nbsp;&nbsp;Subd. 2. <b>Administrative issues.</b> (a) The commissioner may select the administrator. <br />
         		<a id="pl.20.8"></a><var>20.8</var>The administrator must have ~~at least five years of~~ experience working as a power systems <br />
         		<a id="pl.20.9"></a><var>20.9</var>~~engineer~~ planner or transmission planner, or in a position dealing with power system <br />
         		<a id="pl.20.10"></a><var>20.10</var>reliability issues, and may not have been a party or a participant in a commission energy <br />
         		<a id="pl.20.11"></a><var>20.11</var>proceeding for at least one year prior to selection by the commissioner. The commissioner <br />
         		<a id="pl.20.12"></a><var>20.12</var>shall oversee and direct the work of the administrator, annually review the expenses of the <br />
         		<a id="pl.20.13"></a><var>20.13</var>administrator, and annually approve the budget of the administrator. The administrator <br />
         		<a id="pl.20.14"></a><var>20.14</var>may hire staff and may contract for technical expertise in performing duties when existing <br />
         		<a id="pl.20.15"></a><var>20.15</var>state resources are required for other state responsibilities or when special expertise is <br />
         		<a id="pl.20.16"></a><var>20.16</var>required. The salary of the administrator is governed by section 
         <statute_ref>15A.0815, subdivision 2</statute_ref>.<br />
         		<a id="pl.20.17"></a><var>20.17</var>&nbsp;&nbsp;&nbsp;&nbsp;(b) Costs relating to a specific proceeding, analysis, or project are not general <br />
         		<a id="pl.20.18"></a><var>20.18</var>administrative costs. For purposes of this section, "energy utility" means public utilities, <br />
         		<a id="pl.20.19"></a><var>20.19</var>generation and transmission cooperative electric associations, and municipal power <br />
         		<a id="pl.20.20"></a><var>20.20</var>agencies providing natural gas or electric service in the state.<br />
         		<a id="pl.20.21"></a><var>20.21</var>&nbsp;&nbsp;&nbsp;&nbsp;(c) The Department of Commerce shall pay:<br />
         		<a id="pl.20.22"></a><var>20.22</var>&nbsp;&nbsp;&nbsp;&nbsp;(1) the general administrative costs of the administrator, not to exceed $1,000,000 <br />
         		<a id="pl.20.23"></a><var>20.23</var>in a fiscal year, and shall assess energy utilities for those administrative costs. These <br />
         		<a id="pl.20.24"></a><var>20.24</var>costs must be consistent with the budget approved by the commissioner under paragraph <br />
         		<a id="pl.20.25"></a><var>20.25</var>(a). The department shall apportion the costs among all energy utilities in proportion to <br />
         		<a id="pl.20.26"></a><var>20.26</var>their respective gross operating revenues from sales of gas or electric service within <br />
         		<a id="pl.20.27"></a><var>20.27</var>the state during the last calendar year, and shall then render a bill to each utility on a <br />
         		<a id="pl.20.28"></a><var>20.28</var>regular basis; and<br />
         		<a id="pl.20.29"></a><var>20.29</var>&nbsp;&nbsp;&nbsp;&nbsp;(2) costs relating to a specific proceeding analysis or project and shall render a bill to <br />
         		<a id="pl.20.30"></a><var>20.30</var>the specific energy utility or utilities participating in the proceeding, analysis, or project <br />
         		<a id="pl.20.31"></a><var>20.31</var>directly, either at the conclusion of a particular proceeding, analysis, or project, or from <br />
         		<a id="pl.20.32"></a><var>20.32</var>time to time during the course of the proceeding, analysis, or project.<br />
         		<a id="pl.20.33"></a><var>20.33</var>&nbsp;&nbsp;&nbsp;&nbsp;(d) For purposes of administrative efficiency, the department shall assess energy <br />
         		<a id="pl.20.34"></a><var>20.34</var>utilities and issue bills in accordance with the billing and assessment procedures provided <br />
         		<a id="pl.20.35"></a><var>20.35</var>in section 
         <statute_ref>216B.62</statute_ref>, to the extent that these procedures do not conflict with this subdivision. <br />
         		<a id="pl.21.1"></a><var>21.1</var>The amount of the bills rendered by the department under paragraph (c) must be paid by <br />
         		<a id="pl.21.2"></a><var>21.2</var>the energy utility into an account in the special revenue fund in the state treasury within <br />
         		<a id="pl.21.3"></a><var>21.3</var>30 days from the date of billing and is appropriated to the department for the purposes <br />
         		<a id="pl.21.4"></a><var>21.4</var>provided in this section. The commission shall approve or approve as modified a rate <br />
         		<a id="pl.21.5"></a><var>21.5</var>schedule providing for the automatic adjustment of charges to recover amounts paid by <br />
         		<a id="pl.21.6"></a><var>21.6</var>utilities under this section. All amounts assessed under this section are in addition to <br />
         		<a id="pl.21.7"></a><var>21.7</var>amounts appropriated to the commission and the department by other law.<br />
         		<br />
         		<a id="bill.0.23.0"></a><a id="pl.21.8"></a><var>21.8</var>&nbsp;&nbsp;&nbsp;&nbsp;Sec. 23. <b>[216C.055] KEY ROLE OF SOLAR AND BIOMASS RESOURCES IN </b><br />
         		<a id="pl.21.9"></a><var>21.9</var><b>PRODUCING THERMAL ENERGY.</b><br />
         		<a id="pl.21.10"></a><var>21.10</var>The legislature recognizes that the use of solar energy and the combustion of grasses, <br />
         		<a id="pl.21.11"></a><var>21.11</var>agricultural wastes, trees, and other vegetation to produce thermal energy for heating <br />
         		<a id="pl.21.12"></a><var>21.12</var>commercial, industrial, and residential buildings and for industrial process can play a <br />
         		<a id="pl.21.13"></a><var>21.13</var>significant role in helping Minnesota meet its future energy needs and its greenhouse gas <br />
         		<a id="pl.21.14"></a><var>21.14</var>emissions reduction goals. The annual legislative proposals required to be submitted by <br />
         		<a id="pl.21.15"></a><var>21.15</var>the commissioners of commerce and the Pollution Control Agency under section 216H.07, <br />
         		<a id="pl.21.16"></a><var>21.16</var>subdivision 4, must include proposals regarding the use of the renewable energy sources <br />
         		<a id="pl.21.17"></a><var>21.17</var>described in this section if the commissioners determine that such policies are appropriate <br />
         		<a id="pl.21.18"></a><var>21.18</var>to achieve the state's greenhouse gas emissions reduction goals. No legal claim against <br />
         		<a id="pl.21.19"></a><var>21.19</var>any person is allowed under this section. The combustion of municipal solid waste or <br />
         		<a id="pl.21.20"></a><var>21.20</var>refuse-derived fuel to produce thermal energy is not addressed under this section. For <br />
         		<a id="pl.21.21"></a><var>21.21</var>purposes of this section, removal of woody biomass from publicly owned forests must be <br />
         		<a id="pl.21.22"></a><var>21.22</var>consistent with the principles of sustainable forest management.<br />
         		<br />
         		<a id="bill.0.24.0"></a><a id="pl.21.23"></a><var>21.23</var>&nbsp;&nbsp;&nbsp;&nbsp;Sec. 24. Minnesota Statutes 2008, section 216C.41, subdivision 5a, is amended to read:<br />
         		<a id="pl.21.24"></a><var>21.24</var>&nbsp;&nbsp;&nbsp;&nbsp;Subd. 5a. <b>Renewable development account.</b> The Department of Commerce <br />
         		<a id="pl.21.25"></a><var>21.25</var>shall authorize payment of the renewable energy production incentive to wind energy <br />
         		<a id="pl.21.26"></a><var>21.26</var>conversion systems ~~for 200 megawatts of nameplate capacity and~~ that are eligible under <br />
         		<a id="pl.21.27"></a><var>21.27</var>this section or Laws 2005, chapter 40, to on-farm biogas recovery facilities, and to <br />
         		<a id="pl.21.28"></a><var>21.28</var>hydroelectric facilities. Payment of the incentive shall be made from the renewable energy <br />
         		<a id="pl.21.29"></a><var>21.29</var>development account as provided under section 
         <statute_ref>116C.779, subdivision 2</statute_ref>.<br />
         		<br />
         		<a id="bill.0.25.0"></a><a id="pl.21.30"></a><var>21.30</var>&nbsp;&nbsp;&nbsp;&nbsp;Sec. 25. Minnesota Statutes 2008, section 216F.01, subdivision 2, is amended to read:<br />
         		<a id="pl.21.31"></a><var>21.31</var>&nbsp;&nbsp;&nbsp;&nbsp;Subd. 2. <b>Large wind energy conversion system or LWECS.</b> "Large wind energy <br />
         		<a id="pl.21.32"></a><var>21.32</var>conversion system" or "LWECS" means any combination of WECS with a combined <br />
         		<a id="pl.21.33"></a><var>21.33</var>nameplate capacity ~~of 5,000~~ greater than 25,000 kilowatts ~~or more~~.<br />
         		<a id="pl.22.1"></a><var>22.1</var><b>EFFECTIVE DATE.</b>This section is effective the day following final enactment.<br />
         		<br />
         		<a id="bill.0.26.0"></a><a id="pl.22.2"></a><var>22.2</var>&nbsp;&nbsp;&nbsp;&nbsp;Sec. 26. Minnesota Statutes 2008, section 216F.01, subdivision 3, is amended to read:<br />
         		<a id="pl.22.3"></a><var>22.3</var>&nbsp;&nbsp;&nbsp;&nbsp;Subd. 3. <b>Small wind energy conversion system or SWECS.</b> "Small wind energy <br />
         		<a id="pl.22.4"></a><var>22.4</var>conversion system" or "SWECS" means any combination of WECS with a combined <br />
         		<a id="pl.22.5"></a><var>22.5</var>nameplate capacity ~~of~~ less than ~~5,000~~ or equal to 25,000 kilowatts.<br />
         		<a id="pl.22.6"></a><var>22.6</var><b>EFFECTIVE DATE.</b>This section is effective the day following final enactment.<br />
         		<br />
         		<a id="bill.0.27.0"></a><a id="pl.22.7"></a><var>22.7</var>&nbsp;&nbsp;&nbsp;&nbsp;Sec. 27. Minnesota Statutes 2008, section 216F.012, is amended to read:<br />
         		<a id="pl.22.8"></a><var>22.8</var><b>216F.012 SIZE ELECTION. </b><br />
         		<a id="pl.22.9"></a><var>22.9</var>&nbsp;&nbsp;&nbsp;&nbsp;(a) ~~A wind energy conversion system of less than 25 megawatts of nameplate~~ <br />
         		<a id="pl.22.10"></a><var>22.10</var>~~capacity as determined under section~~ 
         <statute_ref>~~216F.011~~</statute_ref> ~~is a small wind energy conversion system~~ <br />
         		<a id="pl.22.11"></a><var>22.11</var>~~if, by July 1, 2009, the owner so elects in writing and submits a completed application for~~ <br />
         		<a id="pl.22.12"></a><var>22.12</var>~~zoning approval and the written election to the county or counties in which the project is~~ <br />
         		<a id="pl.22.13"></a><var>22.13</var>~~proposed to be located. The owner must notify the Public Utilities Commission of the~~ <br />
         		<a id="pl.22.14"></a><var>22.14</var>~~election at the time the owner submits the election to the county.~~ <br />
         		<a id="pl.22.15"></a><var>22.15</var>&nbsp;&nbsp;&nbsp;&nbsp;~~(b) Notwithstanding paragraph (a),~~ A wind energy conversion system with a <br />
         		<a id="pl.22.16"></a><var>22.16</var>nameplate capacity exceeding five megawatts that is proposed to be located wholly or <br />
         		<a id="pl.22.17"></a><var>22.17</var>partially within a wind access buffer adjacent to state lands that are part of the outdoor <br />
         		<a id="pl.22.18"></a><var>22.18</var>recreation system, as enumerated in section 
         <statute_ref>86A.05</statute_ref>, is a large wind energy conversion <br />
         		<a id="pl.22.19"></a><var>22.19</var>system. The Department of Natural Resources shall negotiate in good faith with a system <br />
         		<a id="pl.22.20"></a><var>22.20</var>owner regarding siting and may support the system owner in seeking a variance from the <br />
         		<a id="pl.22.21"></a><var>22.21</var>system setback requirements if it determines that a variance is in the public interest. <br />
         		<a id="pl.22.22"></a><var>22.22</var>&nbsp;&nbsp;&nbsp;&nbsp;~~(c)~~ (b) The Public Utilities Commission shall issue an annual report to the chairs <br />
         		<a id="pl.22.23"></a><var>22.23</var>and ranking minority members of the house of representatives and senate committees <br />
         		<a id="pl.22.24"></a><var>22.24</var>with primary jurisdiction over energy policy and natural resource policy regarding any <br />
         		<a id="pl.22.25"></a><var>22.25</var>variances applied for and not granted for systems subject to paragraph (b). <br />
         		<a id="pl.22.26"></a><var>22.26</var><b>EFFECTIVE DATE.</b>This section is effective July 1, 2009.<br />
         		<br />
         		<a id="bill.0.28.0"></a><a id="pl.22.27"></a><var>22.27</var>&nbsp;&nbsp;&nbsp;&nbsp;Sec. 28. Minnesota Statutes 2008, section 216F.02, is amended to read:<br />
         		<a id="pl.22.28"></a><var>22.28</var><b>216F.02 EXEMPTIONS.</b><br />
         		<a id="pl.22.29"></a><var>22.29</var>(a) The requirements of chapter 216E do not apply to the siting of ~~LWECS~~ a WECS <br />
         		<a id="pl.22.30"></a><var>22.30</var>with a combined nameplate greater than 5,000 kilowatts that applies to the commission for <br />
         		<a id="pl.22.31"></a><var>22.31</var>a site permit, except for sections 
         <statute_ref>216E.01</statute_ref>; 
         <statute_ref>216E.03, subdivision 7</statute_ref>; 
         <statute_ref>216E.08</statute_ref>; 
         <statute_ref>216E.11</statute_ref>; <br />
         		
         <statute_ref><a id="pl.22.32"></a><var>22.32</var>216E.12
         </statute_ref>; 
         <statute_ref>216E.14</statute_ref>; 
         <statute_ref>216E.15</statute_ref>; 
         <statute_ref>216E.17</statute_ref>; and 
         <statute_ref>216E.18, subdivision 3</statute_ref>, which do apply. <br />
         		<a id="pl.23.1"></a><var>23.1</var>(b) Any person may construct an SWECS with a combined nameplate capacity less <br />
         		<a id="pl.23.2"></a><var>23.2</var>than or equal to 5,000  kilowatts without complying with chapter 216E or this chapter. <br />
         		<a id="pl.23.3"></a><var>23.3</var>(c) Nothing in this chapter ~~shall preclude~~ precludes a local governmental unit from <br />
         		<a id="pl.23.4"></a><var>23.4</var>establishing requirements for the siting and construction of SWECS. <br />
         		<a id="pl.23.5"></a><var>23.5</var><b>EFFECTIVE DATE.</b>This section is effective the day following final enactment.<br />
         		<br />
         		<a id="bill.0.29.0"></a><a id="pl.23.6"></a><var>23.6</var>&nbsp;&nbsp;&nbsp;&nbsp;Sec. 29. Minnesota Statutes 2008, section 216F.08, is amended to read:<br />
         		<a id="pl.23.7"></a><var>23.7</var><b>216F.08 PERMIT AUTHORITY; ASSUMPTION BY COUNTIES.</b><br />
         		<a id="pl.23.8"></a><var>23.8</var>&nbsp;&nbsp;&nbsp;&nbsp;(a) A county board may, by resolution and upon written notice to the Public Utilities <br />
         		<a id="pl.23.9"></a><var>23.9</var>Commission, assume responsibility for processing applications for permits required under <br />
         		<a id="pl.23.10"></a><var>23.10</var>this chapter for ~~LWECS with a combined nameplate capacity of less than 25,000 kilowatts~~ <br />
         		<a id="pl.23.11"></a><var>23.11</var>SWECS. The responsibility for permit application processing, if assumed by a county, <br />
         		<a id="pl.23.12"></a><var>23.12</var>may be delegated by the county board to an appropriate county officer or employee. <br />
         		<a id="pl.23.13"></a><var>23.13</var>~~Processing by~~ A county shall ~~be done~~ process applications in accordance with procedures <br />
         		<a id="pl.23.14"></a><var>23.14</var>and processes established under chapter 394. <br />
         		<a id="pl.23.15"></a><var>23.15</var>&nbsp;&nbsp;&nbsp;&nbsp;(b) A county board that exercises its option under paragraph (a) may issue, deny, <br />
         		<a id="pl.23.16"></a><var>23.16</var>modify, impose conditions upon, or revoke permits pursuant to this section. The action of <br />
         		<a id="pl.23.17"></a><var>23.17</var>~~the~~ a county board ~~about~~ with respect to a permit application is final, subject to appeal as <br />
         		<a id="pl.23.18"></a><var>23.18</var>provided in section 
         <statute_ref>394.27</statute_ref>. <br />
         		<a id="pl.23.19"></a><var>23.19</var>&nbsp;&nbsp;&nbsp;&nbsp;(c) The commission shall, by order, establish general permit standards~~, including~~ <br />
         		<a id="pl.23.20"></a><var>23.20</var>~~appropriate property line set-backs,~~ governing site permits for LWECS ~~under this section~~ <br />
         		<a id="pl.23.21"></a><var>23.21</var>and SWECS. ~~The order must consider existing and historic commission standards for~~ <br />
         		<a id="pl.23.22"></a><var>23.22</var>~~wind permits issued by the commission.~~ The general permit standards ~~shall~~ may apply <br />
         		<a id="pl.23.23"></a><var>23.23</var>to permits issued by counties and must apply to permits issued by the commission for <br />
         		<a id="pl.23.24"></a><var>23.24</var>LWECS ~~with a combined nameplate capacity of less than 25,000 kilowatts~~ and SWECS. <br />
         		<a id="pl.23.25"></a><var>23.25</var>The general permit standards must establish a setback for a SWECS from a road or <br />
         		<a id="pl.23.26"></a><var>23.26</var>property line equal to 1.1 times the maximum tip height of a rotor blade measured from <br />
         		<a id="pl.23.27"></a><var>23.27</var>ground level when the blade is in a vertical position. Counties are encouraged to consider <br />
         		<a id="pl.23.28"></a><var>23.28</var>an identical setback standard in permits they issue. The commission or a county may grant <br />
         		<a id="pl.23.29"></a><var>23.29</var>a variance from a general permit standard if the variance is found to be in the public <br />
         		<a id="pl.23.30"></a><var>23.30</var>interest. Permit standards established by a county under this section supersede general <br />
         		<a id="pl.23.31"></a><var>23.31</var>permit standards established by the commission.<br />
         		<a id="pl.23.32"></a><var>23.32</var>&nbsp;&nbsp;&nbsp;&nbsp;(d) Upon request by a county, the commission and the commissioner of commerce <br />
         		<a id="pl.23.33"></a><var>23.33</var>shall provide technical assistance to a county with respect to ~~the processing of LWECS~~ <br />
         		<a id="pl.23.34"></a><var>23.34</var>SWECS site permit applications.<br />
         		<a id="pl.24.1"></a><var>24.1</var><b>EFFECTIVE DATE.</b>This section is effective the day following final enactment.<br />
         		<br />
         		<a id="bill.0.30.0"></a><a id="pl.24.2"></a><var>24.2</var>&nbsp;&nbsp;&nbsp;&nbsp;Sec. 30. <b>MOUNTAIN IRON ECONOMIC DEVELOPMENT AUTHORITY; </b><br />
         		<a id="pl.24.3"></a><var>24.3</var><b>WIND ENERGY PROJECT.</b><br />
         		<a id="pl.24.4"></a><var>24.4</var>(a) The Mountain Iron Economic Development Authority may form or become a <br />
         		<a id="pl.24.5"></a><var>24.5</var>member of a limited liability company organized under Minnesota Statutes, chapter 322B, <br />
         		<a id="pl.24.6"></a><var>24.6</var>for the purpose of developing a community-based energy development project pursuant <br />
         		<a id="pl.24.7"></a><var>24.7</var>to Minnesota Statutes, section 216B.1612. A limited liability company formed or joined <br />
         		<a id="pl.24.8"></a><var>24.8</var>under this section is subject to the open meeting requirements established in Minnesota <br />
         		<a id="pl.24.9"></a><var>24.9</var>Statutes, chapter 13D. A project authorized by this section may not sell, transmit, or <br />
         		<a id="pl.24.10"></a><var>24.10</var>distribute the electrical energy at retail or provide for end use of the electricity to an <br />
         		<a id="pl.24.11"></a><var>24.11</var>off-site facility of the economic development corporation or the limited liability company. <br />
         		<a id="pl.24.12"></a><var>24.12</var>Nothing in this section modifies the exclusive service territories or exclusive right to serve <br />
         		<a id="pl.24.13"></a><var>24.13</var>as provided in Minnesota Statutes, sections 216B.37 to 216B.43.<br />
         		<a id="pl.24.14"></a><var>24.14</var>(b) The authority may acquire a leasehold interest in property outside its corporate <br />
         		<a id="pl.24.15"></a><var>24.15</var>boundaries for the purpose of developing a community-based energy development project <br />
         		<a id="pl.24.16"></a><var>24.16</var>as provided in Minnesota Statutes, section 216B.1612.<br />
         		<a id="pl.24.17"></a><var>24.17</var><b>EFFECTIVE DATE.</b>This section is effective the day after the city of Mountain <br />
         		<a id="pl.24.18"></a><var>24.18</var>Iron and its chief clerical officer comply with Minnesota Statutes, section 645.021, <br />
         		<a id="pl.24.19"></a><var>24.19</var>subdivisions 2 and 3.<br />
         		<br />
         		<a id="bill.0.31.0"></a><a id="pl.24.20"></a><var>24.20</var>&nbsp;&nbsp;&nbsp;&nbsp;Sec. 31. <b>SOLAR CITIES REPORT.</b><br />
         		<a id="pl.24.21"></a><var>24.21</var>The cities of Minneapolis and St. Paul, designated as solar cities under the federal <br />
         		<a id="pl.24.22"></a><var>24.22</var>Department of Energy's Solar America Initiative, shall, by October 1, 2009, and October <br />
         		<a id="pl.24.23"></a><var>24.23</var>1, 2010, submit a report to the cochairs of the Legislative Energy Committee containing <br />
         		<a id="pl.24.24"></a><var>24.24</var>strategies to accelerate the rate of solar thermal and solar electric energy installations <br />
         		<a id="pl.24.25"></a><var>24.25</var>in all building types throughout the state.  The report must, at a minimum, address the <br />
         		<a id="pl.24.26"></a><var>24.26</var>following issues:<br />
         		<a id="pl.24.27"></a><var>24.27</var>(1) identify legal, administrative, financial, and operational barriers to increasing the <br />
         		<a id="pl.24.28"></a><var>24.28</var>installation of solar energy, and measures to overcome them;<br />
         		<a id="pl.24.29"></a><var>24.29</var>(2) identify financial and regulatory mechanisms that stimulate the development of <br />
         		<a id="pl.24.30"></a><var>24.30</var>solar energy;<br />
         		<a id="pl.24.31"></a><var>24.31</var>(3) identify ways to link solar energy development with energy conservation and <br />
         		<a id="pl.24.32"></a><var>24.32</var>energy efficiency strategies and programs;<br />
         		<a id="pl.24.33"></a><var>24.33</var>(4) how efforts and initiatives undertaken by St. Paul and Minneapolis can be <br />
         		<a id="pl.24.34"></a><var>24.34</var>integrated with activities undertaken in other parts of the state; and<br />
         		<a id="pl.25.1"></a><var>25.1</var>(5) how projected trends in solar technologies and the costs of solar generation can <br />
         		<a id="pl.25.2"></a><var>25.2</var>be integrated into the state's strategy to advance adoption of solar energy.<br />
         		<a id="pl.25.3"></a><var>25.3</var>In preparing these reports, the cities may confer with any person whose experience <br />
         		<a id="pl.25.4"></a><var>25.4</var>and expertise will assist in preparing the reports, including utilities, businesses providing <br />
         		<a id="pl.25.5"></a><var>25.5</var>solar energy installation services, nonprofit organizations promoting solar energy, and <br />
         		<a id="pl.25.6"></a><var>25.6</var>others.<br />
         		<br />
         		<a id="bill.0.32.0"></a><a id="pl.25.7"></a><var>25.7</var>&nbsp;&nbsp;&nbsp;&nbsp;Sec. 32. <b>NATURAL GAS UTILITIES; INTERIM ENERGY SAVINGS PLAN.</b><br />
         		<a id="pl.25.8"></a><var>25.8</var>(a) The commissioner of commerce may approve an energy conservation <br />
         		<a id="pl.25.9"></a><var>25.9</var>improvement plan under Minnesota Statutes, section 216B.241, subdivision 1c, paragraph <br />
         		<a id="pl.25.10"></a><var>25.10</var>(d), that:<br />
         		<a id="pl.25.11"></a><var>25.11</var>(1) is submitted to the commissioner in calendar year 2009 by a utility that provides <br />
         		<a id="pl.25.12"></a><var>25.12</var>natural gas service at retail;<br />
         		<a id="pl.25.13"></a><var>25.13</var>(2) governs the conservation improvements to be undertaken by the utility over the <br />
         		<a id="pl.25.14"></a><var>25.14</var>next three-year time period; and<br />
         		<a id="pl.25.15"></a><var>25.15</var>(3) is accompanied by a study that specifies how the utility may:<br />
         		<a id="pl.25.16"></a><var>25.16</var>(i) average savings of at least 0.75 percent over the three years following submission <br />
         		<a id="pl.25.17"></a><var>25.17</var>of the plan;<br />
         		<a id="pl.25.18"></a><var>25.18</var>(ii) meet and exceed the minimum energy savings goal of one percent of gross <br />
         		<a id="pl.25.19"></a><var>25.19</var>annual retail sales within five years of submission of the plan; and<br />
         		<a id="pl.25.20"></a><var>25.20</var>(iii) achieve average annual savings of at least one percent over the nine years <br />
         		<a id="pl.25.21"></a><var>25.21</var>following submission of the plan.<br />
         		<a id="pl.25.22"></a><var>25.22</var>(b) The plan must include projections of the total amount spent by the utility to <br />
         		<a id="pl.25.23"></a><var>25.23</var>achieve energy savings each year and the cost per unit of energy saved.<br />
         		<a id="pl.25.24"></a><var>25.24</var>(c) Nothing in this section precludes the commissioner from requiring additional <br />
         		<a id="pl.25.25"></a><var>25.25</var>energy conservation improvement activities and programs beyond those proposed by a <br />
         		<a id="pl.25.26"></a><var>25.26</var>utility in its proposed plan so long as those additional activities and programs meet the <br />
         		<a id="pl.25.27"></a><var>25.27</var>requirements of Minnesota Statutes, section 216B.241. The commissioner shall require <br />
         		<a id="pl.25.28"></a><var>25.28</var>all reasonable actions by a utility that will increase the likelihood of the utility's meeting <br />
         		<a id="pl.25.29"></a><var>25.29</var>and exceeding the minimum one percent energy savings goal and the 1.5 percent goal <br />
         		<a id="pl.25.30"></a><var>25.30</var>as soon as reasonably feasible.<br />
         		<br />
         		<a id="bill.0.33.0"></a><a id="pl.25.31"></a><var>25.31</var>&nbsp;&nbsp;&nbsp;&nbsp;Sec. 33. <b>CLEAN ENERGY RESOURCE TEAMS; APPROPRIATION.</b><br />
         		<a id="pl.25.32"></a><var>25.32</var>The utility subject to Minnesota Statutes, section 116C.779, shall transfer $563,000 <br />
         		<a id="pl.25.33"></a><var>25.33</var>in fiscal year 2010 and $563,000 in fiscal year 2011 from the renewable development <br />
         		<a id="pl.25.34"></a><var>25.34</var>account established in Minnesota Statutes, section 116C.779, to the Department of <br />
         		<a id="pl.26.1"></a><var>26.1</var>Commerce on a schedule to be determined by the commissioner of commerce. The funds <br />
         		<a id="pl.26.2"></a><var>26.2</var>must be deposited in the special revenue fund and are appropriated to the commissioner <br />
         		<a id="pl.26.3"></a><var>26.3</var>for the purposes of this section.<br />
         		<a id="pl.26.4"></a><var>26.4</var>$563,000 in fiscal year 2010 and $563,000 in fiscal year 2011 are for continued <br />
         		<a id="pl.26.5"></a><var>26.5</var>funding of community energy technical assistance and outreach on renewable energy and <br />
         		<a id="pl.26.6"></a><var>26.6</var>energy efficiency, as described in Minnesota Statutes, section 216C.385. Of this amount, <br />
         		<a id="pl.26.7"></a><var>26.7</var>$113,000 each year is for technical assistance in the metropolitan area.<br />
         		<br />
         		<a id="bill.0.34.0"></a><a id="pl.26.8"></a><var>26.8</var>&nbsp;&nbsp;&nbsp;&nbsp;Sec. 34. <b> REPEALER.</b><br />
         		<a id="pl.26.9"></a><var>26.9</var>Laws 2007, chapter 3, section 3, is repealed.<br />
         		
      </div>