[Congressional Bills 107th Congress]
[From the U.S. Government Publishing Office]
[H.R. 3037 Introduced in House (IH)]
107th CONGRESS
1st Session
H. R. 3037
To enhance the benefits of the national electric system by encouraging
and supporting State programs for renewable energy sources, universal
electric service, affordable electric service, and energy conservation
and efficiency, and for other purposes.
_______________________________________________________________________
IN THE HOUSE OF REPRESENTATIVES
October 4, 2001
Mr. Pallone introduced the following bill; which was referred to the
Committee on Energy and Commerce
_______________________________________________________________________
A BILL
To enhance the benefits of the national electric system by encouraging
and supporting State programs for renewable energy sources, universal
electric service, affordable electric service, and energy conservation
and efficiency, and for other purposes.
Be it enacted by the Senate and House of Representatives of the
United States of America in Congress assembled,
SECTION 1. SHORT TITLE.
This Act may be cited as the ``Renewable Energy and Energy
Efficiency Investment Act of 2001''.
SEC. 2. FINDINGS.
Congress finds that--
(1) the generation of electricity is unique in its combined
influence on the security, environmental quality, and economic
efficiency of the United States;
(2) the generation and sale of electricity has a direct and
profound impact on interstate commerce;
(3) the Federal Government and the States have a joint
responsibility for the maintenance of public purpose programs
affected by the national electric system;
(4) notwithstanding the public's interest in and enthusiasm
for programs that enhance the environment, encourage the
efficient use of resources, and provide for affordable and
universal service, the investments in those public purposes by
existing means continues to decline;
(5) the dependence of the United States on foreign sources
of fossil fuels is contrary to our national security;
(6) alternative, sustainable energy sources must be
pursued;
(7) consumers have a right to certain information in order
to make objective choices on their electric service providers;
and
(8) net metering of small systems for self-generation of
electricity is in the public interest in order to encourage
private investment in renewable energy resources, stimulate
economic growth, and enhance the continued diversification of
the energy resources used in the United States.
SEC. 3. DEFINITIONS.
In this Act:
(1) Administrator.--The term ``Administrator'' means the
Administrator of the Environmental Protection Agency.
(2) Biomass.--The term ``biomass'' means--
(A) organic material from a plant that is planted
exclusively for the purpose of being used to produce
electricity; and
(B) nonhazardous, cellulosic or agricultural animal
waste material that is segregated from other waste
materials and is derived from--
(i) a forest-related resource, including--
(I) mill and harvesting residue;
(II) precommercial thinnings;
(III) slash; and
(IV) brush;
(ii) an agricultural resource, including--
(I) orchard tree crops;
(II) vineyards;
(III) grain;
(IV) legumes;
(V) sugar; and
(VI) other crop by-products or
residues;
(iii) miscellaneous waste such as--
(I) waste pallets;
(II) crates;
(III) dunnage; and
(IV) landscape or right-of-way tree
trimmings, but not including municipal
solid waste, recyclable postconsumer
wastepaper, painted, treated, or
pressurized wood, wood contaminated
with plastic or metals, or tires; and
(iv) animal waste that is converted to a
fuel rather than directly combusted, the
residue of which is converted to biological
fertilizer, oil, or activated carbon.
(3) Board.--The term ``Board'' means the National Electric
System Benefits Board established under section 4.
(4) Commission.--The term ``Commission'' means the Federal
Energy Regulatory Commission.
(5) Fund.--The term ``Fund'' means the National Electric
System Benefits Fund established by section 5.
(6) Landfill gas.--The term ``landfill gas'' means gas
generated from the decomposition of household solid waste,
commercial solid waste, and industrial solid waste disposed of
in a municipal solid waste landfill unit (as those terms are
defined in regulations promulgated under subtitle D of the
Solid Waste Disposal Act (42 U.S.C. 6941 et seq.)).
(7) Pollutant.--The term ``pollutant'' means--
(A) carbon dioxide, mercury nitrous oxide, sulfur
dioxide, or any other substance that the Administrator
identifies by regulation as a substance that, when
emitted into the air from a combustion device used in
the generation of electricity, endangers public health
or welfare (within the meaning of section 302(h) of the
Clean Air Act (42 U.S.C. 7602(h));
(B) any substance discharged into water that is
regulated under a National Pollutant Discharge
Elimination System permit issued under section 402 of
the Federal Water Pollution Control Act (33 U.S.C.
1342); and
(C) any substance disposed of in a solid or
hazardous waste facility that is regulated under the
Solid Waste Disposal Act (42 U.S.C. 6901 et seq.).
(8) Renewable energy.--The term ``renewable energy'' means
electricity generated from--
(A) a renewable energy source; or
(B) hydrogen that is produced from a renewable
energy source.
(9) Renewable energy source.--The term ``renewable energy
source'' means--
(A) wind;
(B) biomass;
(C) landfill gas; or
(D) a geothermal, solar thermal, or photovoltaic
source.
(10) Retail electric supplier.--
(A) In general.--The term ``retail electric
supplier'' means a person or entity that sells retail
electricity to consumers.
(B) Inclusions.--The term ``retail electric
supplier'' includes--
(i) a regulated utility company (including
affiliates or associates of such a company);
(ii) a company that is not affiliated or
associated with a regulated utility company;
(iii) a municipal utility;
(iv) a cooperative utility;
(v) a local government; and
(vi) a special district.
(11) Secretary.--The term ``Secretary'' means the Secretary
of Energy.
SEC. 4. NATIONAL ELECTRIC SYSTEM PUBLIC BENEFITS BOARD.
(a) Establishment.--The Secretary shall establish a National
Electric System Public Benefits Board to carry out the functions and
responsibilities described in this section.
(b) Membership.--The Board shall be composed of--
(1) 1 representative of the Commission appointed by the
Commission;
(2) 2 representatives of the Secretary appointed by the
Secretary;
(3) 2 persons nominated by the national organization
representing State regulatory commissioners and appointed by
the Secretary;
(4) 1 person nominated by the national organization
representing State utility consumer advocates and appointed by
the Secretary;
(5) 1 person nominated by the national organization
representing State energy offices and appointed by the
Secretary;
(6) 1 person nominated by the national organization
representing energy assistance directors and appointed by the
Secretary; and
(7) 1 representative of the Environmental Protection Agency
appointed by the Administrator.
(c) Chairperson.--The Secretary shall select a member of the Board
to serve as Chairperson of the Board.
(d) Manager.--
(1) Appointment.--The Board shall by contract appoint an
electric systems public benefits manager for a term of not more
than 3 years, which term may be renewed by the Board.
(2) Compensation.--The compensation and other terms and
conditions of employment of the manager shall be determined by
a contract between the Board and the individual or the other
entity appointed as manager.
(3) Functions.--The manager shall--
(A) monitor the amounts in the Fund;
(B) receive, review, and make recommendations to
the Board regarding applications from States under
section 6(b); and
(C) perform such other functions as the Board may
require to assist the Board in carrying out its duties
under this Act.
SEC. 5. NATIONAL ELECTRIC SYSTEM PUBLIC BENEFITS FUND.
(a) Establishment.--
(1) In general.--The Board shall establish an account or
accounts at one or more financial institutions, which account
or accounts shall be known as the ``National Electric System
Public Benefits Fund'', consisting of amounts deposited in the
fund under subsection (c).
(2) Status of fund.--The wires charges collected under
subsection (c) and deposited in the Fund--
(A) shall constitute electric system revenues and
shall not constitute funds of the United States;
(B) shall be held in trust by the manager of the
Fund solely for the purposes stated in subsection (b);
and
(C) shall not be available to meet any obligations
of the United States.
(b) Use of Fund.--
(1) Funding of public purpose programs.--Amounts in the
Fund shall be used by the Board to provide matching funds to
States for the support of State public purpose programs
relating to--
(A) renewable energy sources;
(B) universal electric service;
(C) affordable electric service;
(D) energy conservation and efficiency;
(E) research and development in areas described in
subparagraphs (A) through (D), or
(F) disconnections during periods of extreme cold
or heat.
(2) Distribution.--
(A) In general.--Except for amounts needed to pay
costs of the Board in carrying out its duties under
this section, the Board shall instruct the manager of the Fund to
distribute all amounts in the Fund to States to fund public purpose
programs under paragraph (1).
(B) Fund share.--
(i) In general.--Subject to clause (iii),
the Fund share of a public purpose program
funded under paragraph (1) shall be 50 percent.
(ii) Proportionate reduction.--To the
extent that the amount of matching funds
requested by States exceeds the maximum
projected revenues of the Fund, the matching
funds distributed to the States shall be
reduced by an amount that is proportionate to
each State's annual consumption of electricity
compared to the Nation's aggregate annual
consumption of electricity.
(iii) Additional state funding.--A State
may apply funds to public purpose programs in
addition to the amount of funds applied for the
purpose of matching the Fund share.
(3) Program criteria.--The Board shall recommend
eligibility criteria for public benefits programs funded under
this section for approval by the Secretary.
(4) Application.--Not later than August 1 of each year
beginning in 2000, a State seeking matching funds for the
following year shall file with the Board, in such form as the
Board may require, an application--
(A) certifying that the funds will be used for an
eligible public purpose program; and
(B) stating the amount of State funds earmarked for
the program.
(c) Wires Charge.--
(1) Determination of needed funding.--Not later than August
1 of each year, the Board shall determine and inform the
Commission of the aggregate amount of wires charges that will
be necessary to be paid into the Fund to pay matching funds to
States and pay the operating costs of the Board in the
following year.
(2) Imposition of wires charge.--
(A) In general.--Not later than December 15 of each
year, the Commission shall impose a nonbypassable,
competitively neutral wires charge to be paid directly
into the Fund by the operator of the wire on
electricity carried through the wire (measured as it
exits the busbar at a generation facility) that affects
interstate commerce.
(B) Amount.--The wires charge shall be set at a
rate equal to the lesser of--
(i) 2.0 mills per kilowatt-hour; or
(ii) a rate that is estimated to result in
the collection of an amount of wires charges
that is as nearly as possible equal to the
amount of needed funding determined under
paragraph (1),
reduced by 50 percent of the amount of any wire charge imposed
on such electricity under State law that is used by a State for
State public purpose program described in subsection (b)(1).
(3) Deposit in the fund.--The wires charge shall be paid by
the operator of the wire directly into the Fund at the end of
each month during the calendar year for distribution by the
electric systems public benefits manager under section 5.
(4) Penalties.--The Commission may assess against a wire
operator that fails to pay a wires charge as required by this
subsection a civil penalty in an amount equal to not more than
the amount of the unpaid wires charge.
(d) Auditing.--
(1) In general.--The Fund shall be audited annually by a
firm of independent certified public accountants in accordance
with generally accepted auditing standards.
(2) Access to records.--Representatives of the Secretary
and the Commission shall have access to all books, accounts,
reports, files, and other records pertaining to the Fund as
necessary to facilitate and verify the audit.
(3) Reports.--
(A) In general.--A report on each audit shall be
submitted to the Secretary, the Commission, and the
Secretary of the Treasury, who shall submit the report
to the President and Congress not later than 180 days
after the close of the fiscal year.
(B) Requirements.--An audit report shall--
(i) set forth the scope of the audit; and
(ii) include--
(I) a statement of assets and
liabilities, capital; and surplus or
deficit;
(II) a statement of surplus or
deficit analysis;
(III) a statement of income and
expenses;
(IV) any other information that may
be considered necessary to keep the
President and Congress informed of the
operations and financial condition of
the Fund; and
(V) any recommendations with
respect to the Fund that the Secretary
or the Commission may have.
SEC. 6. RENEWABLE ENERGY PORTFOLIO STANDARDS.
(a) Minimum Renewable Generation Requirement.--By April 1 of each
calendar year after 2001, each retail electric supplier shall submit to
the Secretary renewable energy credits in an amount equal to the
required annual percentage of the supplier's total kilowatt-hour sales
to end-use customers in the preceding calendar year.
(2) Each retail electric supplier shall include the required annual
percentage, as defined in subsection (b), in all products sold to end-
use customers. Suppliers are prohibited from representing to any
customer or prospective customer that any of its products contain more
than the specified percentage of eligible resources where the
additional amount of eligible resources is being used to satisfy the
minimum renewable generation requirement.
(3) Nothing in this section shall be construed to prohibit any
State from requiring additional renewable energy generation in that
State under any program adopted by the State. A State may limit the
benefits of any State renewable energy program to renewable energy
generators located within the State's boundaries or other boundaries
determined by the state.
(b) Required Renewable Energy.--Of the total amount of electricity
sold by each retail electric supplier during a calendar year, the
amount generated by renewable energy sources shall be not less than the
following:
(1) 2.5 percent in 2002.
(2) 3.0 percent in 2003.
(3) 4.0 percent in 2004.
(4) 5.0 percent in 2005.
(5) 6.0 percent in 2006.
(6) 7.0 percent in 2007.
(7) 8.0 percent in 2008.
(8) 9.0 percent in 2009.
(9) 10.0 percent in 2010.
(10) 11.0 percent in 2011.
(11) 12.0 percent in 2012.
(12) 13.0 percent in 2013.
(13) 14.0 percent in 2014.
(14) 15.0 percent in 2015.
(15) 16.0 percent in 2016.
(16) 17.0 percent in 2017.
(17) 18.0 percent in 2018.
(18) 19.0 percent in 2019.
(19) 20.0 percent in 2020 and each year thereafter.
(c) Submission of Credits.--A retail electric supplier may satisfy
the requirements of subsection (a) through the submission of any of the
following:
(1) Renewable energy credits issued under subsection (d)
for renewable energy generated by the retail electric supplier
in the calendar year for which credits are being submitted or
any previous calendar year.
(2) Renewable energy credits issued under subsection (d) to
any renewable energy generator for renewable energy generated
in the calendar year for which credits are being submitted or a
previous calendar year and acquired by the retail electric
supplier.
(3) Any combination of Credits under paragraphs (1) and
(2).
(d) Issuance of Credit.--(1) The Secretary shall establish, not
later than 1 year after the date of enactment of this section, a
program to issue, monitor the sale or exchange of, and track Renewable
energy credits.
(2) Under the program, an entity that generates electric energy
through the use of a renewable energy resource may apply to the
Secretary for the issuance of renewable energy credits. The application
shall indicate--
(A) the type of renewable energy resource used to produce
the electricity,
(B) the State in which the electric energy was produced,
and
(C) any other information the Secretary determines
appropriate.
(3)(A) The Secretary shall issue to an entity one renewable energy
credit for each kilowatt-hour of electric energy the entity generates
through the use of a renewable energy resource in any State in 2001 and
any succeeding year.
(B) To be eligible for a renewable energy credit, the unit of a
electricity generated through the use of a renewable energy resource
may be sold or may be used by the generator. If both a renewable energy
resource and a nonrenewable energy resource are used to generate the
electric energy, the Secretary shall issue credits based on the
proportion of the renewable energy resource used. The Secretary shall
identify renewable energy credits by type of generation and by the
State in which the generating facility is located.
(4) In order to receive a renewable energy credit, the recipient of
a renewable energy credit shall pay a fee, calculated by the Secretary,
in an amount that is equal to the administrative costs of issuing,
recording, monitoring the sale of exchange of, and tracking the credit
or does not exceed five percent of the dollar value of the credit,
whichever is lower. The Secretary shall retain the fee and use it to
pay these administrative costs.
(e) Sale or Exchange.--A renewable energy credit may be sold or
exchanged by the entity to whom issued or by any other entity who
acquires the credit.
(f) Enforcement.--
(1) In general.--The Secretary may bring an action in the
appropriate United States district court to impose a civil
penalty on a retail electric supplier that does not comply with
subsection (a).
(2) Amount of penalty.--A retail electric supplier who does
not submit the required number of renewable energy credits
under subsection (a) shall be subject to a civil penalty of not
more than 3 times the estimated national average market value (as
determined by the Secretary) for the calendar year concerned of that
quantity of renewable energy credits.
(g) Information Collection.--The Secretary may collect the
information necessary to verify and audit each of the following:
(1) The annual electric energy generation and renewable
energy generation of any entity applying for renewable energy
credits under this section.
(2) The validity of renewable energy credits submitted by a
retail electric supplier to the Secretary.
(3) The quantity of electricity sales of all retail
electric suppliers.
SEC. 7. NET METERING.
(a) Amendment of PURPA.--The Public Utility Regulatory Polices Act
of 1978 is amended by adding the following new section after section
214:
``SEC. 215. NET METERING.
``(a) Definitions.--For purposes of this section--
``(1) The term `eligible on-site generating facility' means
a facility on the site of a residential electric consumer with
a maximum generating capacity of 100 kilowatts or less that is
fueled by solar or wind energy or a facility on the site of a
commercial electric consumer with a maximum generating capacity
of 250 kilowatts or less that is fueled solely by a renewable
energy resource.
``(2) The term `renewable energy resource' means solar
energy, wind energy, biomass, and fuel cells.
``(3) The term `net metering service' means service to an
electric consumer under which electricity generated by that
consumer from an eligible on-site generating facility and
delivered to the distribution system through the same meter
through which purchased electricity is received may be used to
offset the cost of electricity provided by the retail electric
supplier to the electric consumer during the applicable billing
period so that an electric consumer is billed only for the net
electricity consumed during the billing period, but in no event
shall the net be less than zero during any calendar year.
``(b) Requirement To Provide Net Metering Service.--Each retail
electric supplier shall make available upon request net metering
service to any retail electric consumer that the supplier currently
serves or solicits for service.
``(c) Rates and Charges.--
``(1) Identical charges.--A retail electric supplier--
``(A) shall charge the owner or operator of an on-
site generating facility rates and charges that are
identical to those that would be charged other retail
electric customers of the electric company in the same
rate class; and
``(B) shall not charge the owner or operator of an
on-site generating facility any additional standby,
capacity, interconnection, or other rate or charge.
``(2) Measurement.--A retail electric supplier that
supplies electricity to the owner or operator of an on-site
generating facility shall measure the quantity of electricity
produced by the on-site facility and the quantity of
electricity consumed by the owner or operator of an on-site
generating facility during a billing period in accordance with
normal metering practices.
``(3) Electricity supplied exceeding electricity
generated.--If the quantity of electricity supplied by a retail
electric supplier during a billing period exceeds the quantity
of electricity generated by an on-site generating facility and
fed back to the electric distribution system during the billing
period, the supplier may bill the owner or operator for the net
quantity of electricity supplied by the retail electric
supplier, in accordance with normal metering practices.
``(4) Electricity generated exceeding electricity
supplied.--If the quantity of electricity generated by an on-
site generating facility during a billing period exceeds the
quantity of electricity supplied by the retail electric
supplier during the billing period--
``(A) the retail electric supplier may bill the
owner or operator of the on-site generating facility
for the appropriate charges for the billing period in
accordance with paragraph (2); and
``(B) the owner or operator of the on-site
generating facility shall be credited for the excess
kilowatt-hours generated during the billing period,
with the kilowatt-hour credit appearing on the bill for
the following billing period.
``(5) Unused credits.--At the beginning of each calendar
year, any unused kilowatt-hour credits accumulated by an owner
or operator of an on-site generating facility during the
previous calendar year shall expire without compensation to the
owner or operator of an on-site generating facility.
``(d) Safety and Performance Standards.--(1) An eligible on-site
generating facility and net metering system used by a retail electric
consumer shall meet all applicable safety, performance, reliability,
and interconnection standards established by the National Electrical
Code, the Institute of Electrical and Electronics Engineers, and
Underwriters Laboratories.
``(2) The Commission, after consultation with State regulatory
authorities and nonregulated local distribution systems and after
notice and opportunity for comment, may adopt, by rule, additional
control and testing requirements for on-site generating facilities and
net metering systems that the Commission determines are necessary to
protect public safety and system reliability.
``(e) Interconnection Standards.--(1) The Commission shall
promulgate regulations requiring that the owners or operators of
eligible on-site generating facilities and net metering systems comply
with uniform national standards, consistent with this section, for the
physical connection between such facilities and systems and local
distribution systems. At the election of the owner or operator of the
generation facility concerned connections meeting such standards may be
made--
``(A) by such owner or operator at such owner's or
operator's expense, or
``(B) by the owner or operator of the local distribution
system upon the request of the owner or operator of the
generating facility and pursuant to an offer by the owner or
operator of the generating facility to reimburse the local
distribution system in an amount equal to the minimum cost of
such connection, consistent with the procurement procedures of
the State in which the facility is located.
Such standards shall be consistent with all applicable safety and
performance standards established by the national electrical code, the
Institute of Electrical and Electronics Engineers, or Underwriters
Laboratories and with such additional safety and reliability standards
as the Commission shall, by rule, prescribe.
``(2) The regulations under this section shall establish such
measures for the safety and reliability of the affected equipment and
local distribution systems as may be appropriate.
``(f) State Authority.--This section does not preclude a State from
imposing additional requirements consistent with the requirements in
this section, including the imposition of a cap limiting the amount of
net metering available in the State. Nothing in this Act or any other
Federal law preempts or otherwise affects authority under State law to
require a retail electric supplier to make available net metering
service to a retail electric consumer which the supplier serves or
offers to serve.''.
(c) Table of Contents.--The table of contents for title II of the
Public Utility Regulatory Policies Act of 1978 (16 U.S.C. 2601 and
following) is amended by adding the following at the end thereof:
``Sec. 215. Net metering.''.
SEC. 8. DISCLOSURE REQUIREMENTS.
(a) Definitions.--In this section:
(1) Emissions data.--The term ``emissions data'' means the
type and amount of each pollutant emitted or released by a
generation facility in generating electricity.
(2) Generation data.--The term ``generation data'' means
the type of fuel (such as coal, oil, nuclear energy, or solar
power) used by a generation facility to generate electricity.
(b) Disclosure System.--The Secretary shall establish a system of
disclosure that--
(1) enables retail consumers to knowledgeably compare
retail electric service offerings, including comparisons based
on generation source portfolios, emissions data, and price
terms; and
(2) considers such factors as--
(A) cost of implementation;
(B) confidentiality of information; and
(C) flexibility.
(c) Regulation.--Not later than March 1, 2002, the Secretary, in
consultation with the Board, and with the assistance of a Federal
interagency task force that includes representatives of the Commission,
the Federal Trade Commission, the Food and Drug Administration, and the
Environmental Protection Agency, shall promulgate a regulation
prescribing--
(1) the form, content, and frequency of disclosure of
emissions data and generation data of electricity by generation
facilities to electricity wholesalers or retail companies and
by wholesalers to retail companies;
(2) the form, content, and frequency of disclosure of
emissions data, generation data, and the price of electricity
by retail companies to ultimate consumers; and
(3) the form, content, and frequency of disclosure of
emissions data, generation data, and the price of electricity
by generation facilities selling directly to ultimate
consumers.
(d) Access to Records.--The Secretary shall have full access to the
records of all generation facilities, electricity wholesalers, and
retail companies to obtain any information necessary to administer and
enforce this section.
(e) Failure To Disclose.--The failure of a retail company to
accurately disclose information as required by this section shall be
treated as a deceptive act in commerce under section 5 of the Federal
Trade Commission Act (15 U.S.C. 45).
(f) Regulations.--The Secretary may promulgate such regulations,
conduct such investigations, and take such other actions as are
necessary or appropriate to implement and obtain compliance with this
section and regulations promulgated under this section.
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