December 6, 2007, Introduced by Reps. Palsrok, Mayes, Nofs and Accavitti and referred to the Committee on Energy and Technology.
A bill to require certain providers of electric service to
establish a renewable energy program; and to prescribe the powers
and duties of certain state agencies and officials.
THE PEOPLE OF THE STATE OF MICHIGAN ENACT:
Sec. 1. As used in this act:
(a) "Commission" means the Michigan public service commission.
(b) "Portfolio standard" is the minimum percentage of a
provider's total annual retail kilowatt hour electricity sales in
this state that is required to be produced from a renewable energy
resource.
(c) "Provider" means any person that is in the business of
selling electricity to retail customers in this state and includes
all of the following:
(i) Any person or entity that is regulated by the commission
for the purpose of selling electricity to retail customers.
(ii) A municipal electric provider.
(iii) A cooperative electric provider.
(iv) An alternative electric supplier.
(v) An independent investor-owned electric utility.
(d) "Renewable energy" means electricity produced using a
renewable energy resource.
(e) "Renewable energy contract" means a contract to acquire
renewable energy and the associated renewable energy credits from 1
or more renewable energy systems.
(f) "Renewable energy credit" means a certified credit under
this act equal to 1 megawatt hour of generated renewable energy.
(g) "Renewable energy resource" means any of the following:
(i) Biomass.
(ii) Geothermal.
(iii) Solar thermal.
(iv) Photovoltaic cells and panels.
(v) Industrial cogeneration where an integrated unit generates
power and either cools, heats, or controls humidity in a building
or provides heating, drying, or chilling for an industrial process
not including electricity generation.
(vi) An incinerator brought into service before the effective
date of this act that complies with all federal and state
environmental regulations.
(vii) Wind.
(viii) Hydroelectric from existing hydroelectric facilities or
new hydroelectric facilities using existing dams unless, after the
effective date of this act, those dams are modified to increase
their holding capacity or further restrict water flow or in a
manner that does not fully incorporate the best environmental
practices.
(ix) Hydroelectric from pumped storage hydroelectric facilities
to the extent the water was pumped using energy generated from
renewable energy resources.
(x) Landfill gas.
(h) "Renewable energy resource" does not include the burning
or heating of tires, garbage, landscape waste, construction or
demolition debris, or general household, institutional, commercial,
office, or industrial lunchroom waste.
(i) "Renewable energy system" means a facility, electricity
generation system, or integrated set of electricity generation
systems that use renewable energy resources located in this state,
Illinois, Indiana, Minnesota, Ohio, Wisconsin, or the province of
Ontario or Manitoba, Canada.
Sec. 7. (1) Ninety days after the effective date of this act,
the commission shall establish for each provider a maximum retail
rate impact for this section of not less than 110% of the cost of
construction, operation and maintenance, and generation of a new
base load power plant over its lifecycle on a kilowatt per hour
basis. Following the initial determination, the commission shall
update the maximum rate impact at least every 2 years. In its
determination under this subsection, the commission shall consider
and make specific findings with respect to each of the following:
(a) Capital costs, including lifecycle capital additions.
(b) Financing and interest costs.
(c) Forecasted inflation.
(d) Construction costs.
(e) Operation and maintenance costs.
(f) Fuel costs, transportation of fuel costs, and fuel
disposal costs.
(g) Costs of transmitting, generation, and interconnection.
(h) Emission controls.
(i) Taxes and penalties on carbon and emissions.
(j) Costs of security measures.
(k) Other costs the commission considers appropriate.
(2) If the commission determines that the retail rate impact
of this section exceeds the maximum retail rate impact, it shall
reduce the required renewable energy credits required for
compliance with the portfolio standard by an amount necessary to
limit the retail rate impact to the maximum retail rate impact.
Sec. 9. (1) If a provider is unable to comply with the
portfolio standard through the generation of renewable energy
credits derived from its own renewable energy systems, the provider
shall comply by entering into 1 or more renewable energy contracts.
(2) If a provider is unable to comply with the portfolio
standard through the generation of renewable energy credits derived
from its own renewable energy systems or by entering 1 or more
renewable energy contracts, the provider shall purchase renewable
energy credits from a renewable energy system located in this
state.
(3) Renewable energy credits used by a provider to comply with
its portfolio standard are extinguished upon use. Renewable energy
credits shall automatically expire upon the date 3 years after the
generation of the electricity associated with the renewable energy
credit.
Sec. 11. (1) Upon petition by a provider, the commission may
for good cause grant an extension of the 2015 deadline to meet the
portfolio standard under section 5. The extension shall be for 1
year, but subsequent 1-year extensions may be granted for good
cause. If the commission determines that a provider cannot meet the
portfolio standard under section 5 because of a local unit of
government's zoning ordinance, the commission shall grant a
extension to that provider.
(2) The petitioner shall provide the commission information
requested by the commission for its deliberations on the petition
under subsection (1). The commission shall consider factors
including economic impact, availability, cost, and consumer impact
in determining whether to grant or deny the petition.
(3) If a provider, except for a municipally owned utility,
fails to meet the portfolio standard by the deadline under section
5 or the last extended deadline under subsection (2), whichever is
applicable, both of the following apply:
(a) Under section 9, the provider shall obtain sufficient
renewable energy credits to meet the portfolio standard.
(b) The provider shall not recover from its ratepayers the
cost of obtaining renewable energy credits under subdivision (a).
Enacting section 1. As provided in section 5 of 1846 RS 1, MCL
8.5, this act is severable.
Enacting section 2. This act does not take effect unless all
of the following bills of the 94th Legislature are enacted into
law:
(a) House Bill No. 5383.
(b) House Bill No. 5384.
(c) House Bill No. 5520.
(d) House Bill No. 5521.
(e) House Bill No. 5522.
(f) House Bill No. 5523.
(g) House Bill No. 5524.
(h) Senate Bill No.____ or House Bill No. 5548(request no.
05570'07).