1.Renewable electricity
standard
(a)Title VI of the
Public Utility Regulatory Policies Act of 1978 (16 U.S.C. 2601 et seq.) is
amended by adding at the end the following:
610.Renewable
electricity standard
(a)In
this section:
(1)Base quantity of
electricity
(A)The term base quantity of electricity means
the total quantity of electric energy sold by a retail electric supplier,
expressed in terms of kilowatt hours, to electric customers for purposes other
than resale during the most recent calendar year for which information is
available.
(B)The
term base quantity of electricity does not include—
(i)electric energy that is not incremental
hydropower generated by a hydroelectric facility; and
(ii)electricity generated through the
incineration of municipal solid waste.
(2)
(A)The term biomass means—
(i)cellulosic (plant
fiber) organic materials from a plant that is planted for the purpose of being
used to produce energy;
(ii)nonhazardous
plant or algal matter that is derived from—
(I)an agricultural
crop, crop byproduct, or residue resource; or
(II)waste, such as landscape or right-of-way
trimmings (but not including municipal solid waste, recyclable postconsumer
waste paper, painted, treated, or pressurized wood, wood contaminated with
plastic, or metals);
(iii)animal waste or animal byproducts;
and
(iv)landfill
methane.
(B)National forest
land and certain other public landIn the case of organic material removed
from National Forest System land or from public land administered by the
Secretary of the Interior, the term biomass means only organic
material from—
(i)ecological forest restoration;
(ii)precommercial thinnings;
(iii)brush;
(iv)mill residues; or
(v)slash.
(C)Exclusion of
certain Federal landNotwithstanding subparagraph (B), the term
biomass does not include material or matter that would otherwise
qualify as biomass if the material or matter is located on the following
Federal land:
(i)Federal land containing old growth forest
or late successional forest unless the Secretary of the Interior or the
Secretary of Agriculture determines that the removal of organic material from
the land—
(I)is appropriate for the applicable forest
type; and
(II)maximizes the retention of—
- (aa)late-successional and large and old growth
trees;
- (bb)late-successional and old growth forest
structure; and
- (cc)late-successional and old growth forest
composition.
(ii)Federal land on which the removal of
vegetation is prohibited, including components of the National Wilderness
Preservation System.
(iii)Wilderness study areas.
(iv)Inventoried roadless areas.
(v)Components of the National Landscape
Conservation System.
(vi)National Monuments.
(3)The term existing facility means a facility
for the generation of electric energy from a renewable energy resource that is
not an eligible facility.
(4)The term
incremental hydropower means additional generation that is
achieved from increased efficiency or additions of capacity made on or
after—
(A)the date of enactment of this section;
or
(B)the effective date of an existing
applicable State renewable portfolio standard program at a hydroelectric
facility that was placed in service before that date.
(5)The term Indian land means—
(A)any land within
the limits of any Indian reservation, pueblo, or rancheria;
(B)any land not
within the limits of any Indian reservation, pueblo, or rancheria title to
which was on the date of enactment of this section held by—
(i)the United States
for the benefit of any Indian tribe or individual; or
(ii)any Indian tribe
or individual subject to restriction by the United States against
alienation;
(C)any dependent
Indian community; or
(D)any land conveyed
to any Alaska Native corporation under the Alaska Native Claims Settlement Act
(43 U.S.C. 1601 et seq.).
(6)The term Indian tribe means any Indian tribe,
band, nation, or other organized group or community, including any Alaskan
Native village or regional or village corporation as defined in or established
pursuant to the Alaska Native Claims Settlement Act (43 U.S.C. 1601 et seq.),
that is recognized as eligible for the special programs and services provided
by the United States to Indians because of their status as Indians.
(7)The term renewable energy means electric
energy generated by a renewable energy resource.
(8)Renewable energy
resourceThe term
renewable energy resource means solar, wind, ocean, tidal,
geothermal energy, biomass, landfill gas, incremental hydropower, or
hydrokinetic energy.
(9)Repowering or
cofiring incrementThe term repowering or cofiring
increment means—
(A)the additional
generation from a modification that is placed in service on or after the date
of enactment of this section, to expand electricity production at a facility
used to generate electric energy from a renewable energy resource;
(B)the additional
generation above the average generation during the 3-year period ending on the
date of enactment of this section at a facility used to generate electric
energy from a renewable energy resource or to cofire biomass that was placed in
service before the date of enactment of this section; or
(C)the portion of the electric generation from
a facility placed in service on or after the date of enactment of this section,
or a modification to a facility placed in service before the date of enactment
of this section made on or after January 1, 2001, associated with cofiring
biomass.
(10)
(A)The term retail
electric supplier means a person that sells electric energy to electric
consumers (other than consumers in Hawaii) that sold not less than 1,000,000
megawatt-hours of electric energy to electric consumers for purposes other than
resale during the preceding calendar year.
(B)The term retail electric
supplier includes a person that sells electric energy to electric
consumers that, in combination with the sales of any affiliate organized after
the date of enactment of this section, sells not less than 1,000,000 megawatt
hours of electric energy to consumers for purposes other than resale.
(C)Sales to parent
companies or affiliatesFor
purposes of this paragraph, sales by any person to a parent company or to other
affiliates of the person shall not be treated as sales to electric
consumers.
(D)
(i)Except as provided in clause (ii), the term retail
electric supplier does not include—
(I)the United
States, a State, any political subdivision of a State, or any agency,
authority, or instrumentality of the United States, State, or political
subdivision; or
(II)a rural electric
cooperative.
(ii)The
term retail electric supplier includes an entity that is a
political subdivision of a State, or an agency, authority, or instrumentality
of the United States, a State, a political subdivision of a State, a rural
electric cooperative that sells electric energy to electric consumers, or any
other entity that sells electric energy to electric consumers that would not
otherwise qualify as a retail electric supplier if the entity notifies the
Secretary that the entity voluntarily agrees to participate in the Federal
renewable electricity standard program.
(b)For calendar year 2012 and each calendar
year thereafter, each retail electric supplier shall meet the requirements of
subsection (c) by submitting to the Secretary, not later than April 1 of the
following calendar year, 1 or more of the following:
(1)Federal renewable energy credits issued
under subsection (e).
(2)Certification of the renewable energy
generated and electricity savings pursuant to the funds associated with State
compliance payments as specified in subsection (e)(4)(G).
(3)Alternative
compliance payments pursuant to subsection (h).
(c)Required annual
percentageFor each of calendar years 2012 through 2039, the
required annual percentage of the base quantity of electricity of a retail
electric supplier that shall be generated from renewable energy resources, or
otherwise credited towards the percentage requirement pursuant to subsection
(d), shall be the applicable percentage specified in the following
table:
Required Amount
Calendar Yearspercentage
20126.0
20136.0
20148.5
20158.5
201611.0
201711.0
201814.0
201914.0
202017.5
202117.5
202221.0
202321.0
202423.0
2025 and thereafter through 203925.0.
(d)
(1)A retail electric supplier may satisfy the requirements
of subsection (b)(1) through the submission of Federal renewable energy
credits—
(A)issued to the
retail electric supplier under subsection (e);
(B)obtained by
purchase or exchange under subsection (f); or
(C)borrowed under
subsection (g).
(2)Federal
renewable energy creditsA
Federal renewable energy credit may be counted toward compliance with
subsection (b)(1) only once.
(e)Issuance of
Federal renewable energy credits
(1)Not later than 1 year
after the date of enactment of this section, the Secretary shall establish by
rule a program—
(A)to verify and issue Federal renewable
energy credits to generators of renewable energy;
(B)to track the sale, exchange, and retirement
of the credits; and
(C)to enforce the requirements of this
section.
(2)Existing
non-Federal tracking systemsTo the maximum extent practicable, in
establishing the program, the Secretary shall rely on existing and emerging
State or regional tracking systems that issue and track non-Federal renewable
energy credits.
(3)
(A)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.
(B)To
be eligible for the issuance of the credits, the applicant shall demonstrate to
the Secretary that—
(i)the electric
energy will be transmitted onto the grid; or
(ii)in the case of a
generation offset, the electric energy offset would have otherwise been
consumed onsite.
(C)The
application shall indicate—
(i)the type of
renewable energy resource that is used to produce the electricity;
(ii)the location at
which the electric energy will be produced; and
(iii)any other
information the Secretary determines appropriate.
(4)Quantity of
Federal renewable energy credits
(A)Except as otherwise provided in this paragraph, the
Secretary shall issue to a generator of electric energy 1 Federal renewable
energy credit for each kilowatt hour of electric energy generated by the use of
a renewable energy resource at an eligible facility.
(B)
(i)For purpose of
compliance with this section, Federal renewable energy credits for incremental
hydropower shall be based on the increase in average annual generation
resulting from the efficiency improvements or capacity additions.
(ii)The incremental
generation shall be calculated using the same water flow information that
is—
(I)used to determine a historic average annual
generation baseline for the hydroelectric facility; and
(II)certified by the Secretary or the Federal
Energy Regulatory Commission.
(iii)The calculation of
the Federal renewable energy credits for incremental hydropower shall not be
based on any operational changes at the hydroelectric facility that is not
directly associated with the efficiency improvements or capacity
additions.
(C)
(i)The Secretary shall issue 2 renewable energy credits for
each kilowatt hour of electric energy generated and supplied to the grid in a
calendar year through the use of a renewable energy resource at an eligible
facility located on Indian land.
(ii)For
purposes of this paragraph, renewable energy generated by biomass cofired with
other fuels is eligible for 2 credits only if the biomass was grown on the
land.
(D)On-site eligible
facilities
(i)In the case of
electric energy generated by a renewable energy resource at an on-site eligible
facility that is not larger than 1 megawatt in capacity and is used to offset
all or part of the requirements of a customer for electric energy, the
Secretary shall issue 3 renewable energy credits to the customer for each
kilowatt hour generated.
(ii)In the case of an
on-site eligible facility on Indian land, the Secretary shall issue not more
than 3 credits per kilowatt hour.
(E)Combination of
renewable and nonrenewable energy resourcesIf both a renewable energy resource and a
nonrenewable energy resource are used to generate the electric energy, the
Secretary shall issue the Federal renewable energy credits based on the
proportion of the renewable energy resources used.
(F)Retail electric
suppliersIf a generator has
sold electric energy generated through the use of a renewable energy resource
to a retail electric supplier under a contract for power from an existing
facility and the contract has not determined ownership of the Federal renewable
energy credits associated with the generation, the Secretary shall issue the
Federal renewable energy credits to the retail electric supplier for the
duration of the contract.
(G)Compliance with
State renewable portfolio standard programsPayments made by a retail electricity
supplier, directly or indirectly, to a State for compliance with a State
renewable portfolio standard program, or for an alternative compliance
mechanism, shall be valued at 1 credit per kilowatt hour for the purpose of
subsection (b)(2) based on the quantity of electric energy generation from
renewable resources that results from the payments.
(f)Renewable energy
credit trading
(1)A Federal renewable energy credit may be sold,
transferred, or exchanged by the entity to whom the credit is issued or by any
other entity that acquires the Federal renewable energy credit, other than
renewable energy credits from existing facilities.
(2)A
Federal renewable energy credit for any year that is not submitted to satisfy
the minimum renewable generation requirement of subsection (c) for that year
may be carried forward for use pursuant to subsection (b)(1) within the next 3
years.
(3)The Secretary may delegate to an
appropriate market-making entity the administration of a national tradeable
renewable energy credit market for purposes of creating a transparent national
market for the sale or trade of renewable energy credits.
(g)Renewable energy
credit borrowing
(1)Not later than December 31, 2014, a retail electric
supplier that has reason to believe the retail electric supplier will not be
able to fully comply with subsection (b) may—
(A)submit a plan to the Secretary
demonstrating that the retail electric supplier will earn sufficient Federal
renewable energy credits within the next 3 calendar years that, when taken into
account, will enable the retail electric supplier to meet the requirements of
subsection (b) for calendar year 2014 and the subsequent calendar years
involved; and
(B)on the approval of the plan by the
Secretary, apply Federal renewable energy credits that the plan demonstrates
will be earned within the next 3 calendar years to meet the requirements of
subsection (b) for each calendar year involved.
(2)The
retail electric supplier shall repay all of the borrowed Federal renewable
energy credits by submitting an equivalent number of Federal renewable energy
credits, in addition to the credits otherwise required under subsection (b), by
calendar year 2022 or any earlier deadlines specified in the approved
plan.
(h)Alternative
compliance paymentsAs a
means of compliance under subsection (b)(4), the Secretary shall accept payment
equal to the lesser of—
(1)200 percent of the average market value of
Federal renewable energy credits and Federal energy efficiency credits for the
applicable compliance period; or
(2)3 cents per kilowatt hour (as adjusted on
January 1 of each year following calendar year 2006 based on the implicit price
deflator for the gross national product).
(i)The Secretary may collect the information necessary to
verify and audit—
(1)(A)the annual renewable energy generation of
any retail electric supplier; and
(B)Federal renewable energy credits submitted
by a retail electric supplier pursuant to subsection (b)(1);
(2)the validity of
Federal renewable energy credits submitted for compliance by a retail electric
supplier to the Secretary; and
(3)the quantity of
electricity sales of all retail electric suppliers.
(j)Environmental
savings clauseIncremental hydropower shall be subject to all
applicable environmental laws and licensing and regulatory requirements.
(k)
(1)Nothing in this
section diminishes any authority of a State or political subdivision of a
State—
(A)to adopt or enforce any law (including
regulations) respecting renewable energy, including programs that exceed the
required quantity of renewable energy under this section; or
(B)to regulate the acquisition and disposition
of Federal renewable energy credits by retail electric suppliers.
(2)No law or regulation referred to in paragraph (1)(A)
shall relieve any person of any requirement otherwise applicable under this
section.
(3)Coordination
with State programThe Secretary, in consultation with States
that have in effect renewable energy programs, shall—
(A)preserve the
integrity of the State programs, including programs that exceed the required
quantity of renewable energy under this section; and
(B)facilitate
coordination between the Federal program and State programs.
(4)Existing
renewable energy programsIn the regulations establishing the
program under this section, the Secretary shall incorporate common elements of
existing renewable energy programs, including State programs, to ensure
administrative ease, market transparency and effective enforcement.
(5)Minimization of
administrative burdens and costsIn carrying out this section,
the Secretary shall work with the States to minimize administrative burdens and
costs to retail electric suppliers.
(l)An electric utility
that has sales of electric energy that are subject to rate regulation
(including any utility with rates that are regulated by the Commission and any
State regulated electric utility) shall not be denied the opportunity to
recover the full amount of the prudently incurred incremental cost of renewable
energy obtained to comply with the requirements of subsection (b).
(m)
(1)The Secretary shall enter into an arrangement with the
National Academy of Sciences under which the Academy shall conduct a
comprehensive evaluation of all aspects of the program established under this
section.
(2)The
study shall include an evaluation of—
(A)the effectiveness
of the program in increasing the market penetration and lowering the cost of
the eligible renewable energy technologies;
(B)the opportunities
for any additional technologies and sources of renewable energy emerging since
the date of enactment of this section;
(C)the impact on the
regional diversity and reliability of supply sources, including the power
quality benefits of distributed generation;
(D)the regional
resource development relative to renewable potential and reasons for any
investment in renewable resources; and
(E)the net
cost/benefit of the renewable electricity standard to the national and State
economies, including—
(i)retail power
costs;
(ii)the economic
development benefits of investment;
(iii)avoided costs
related to environmental and congestion mitigation investments that would
otherwise have been required;
(iv)the impact on
natural gas demand and price; and
(v)the effectiveness
of green marketing programs at reducing the cost of renewable resources.
(3)Not
later than January 1, 2018, the Secretary shall transmit to Congress a report
describing the results of the evaluation and any recommendations for
modifications and improvements to the program.
(n)State renewable
energy account
(1)There is established
in the Treasury a State renewable energy account.
(2)All
money collected by the Secretary from the alternative compliance payments under
subsection (h) shall be deposited into the State renewable energy account
established under paragraph (1).
(3)
(A)Proceeds deposited in
the State renewable energy account shall be used by the Secretary, subject to
annual appropriations, for a program to provide grants—
(i)to the State agency responsible for
administering a fund to promote renewable energy generation for customers of
the State or an alternative agency designated by the State; or
(ii)if no agency described in clause (i), to
the State agency developing State energy conservation plans under section 362
of the Energy Policy and Conservation Act (42 U.S.C. 6322).
(B)The grants shall be used for the purpose
of—
(i)promoting renewable energy production;
and
(ii)providing energy assistance and
weatherization services to low-income consumers.
(C)The Secretary may issue guidelines and
criteria for grants awarded under this paragraph.
(D)State-approved
funding mechanismsAt least
75 percent of the funds provided to each State for each fiscal year shall be
used to promote renewable energy production through grants, production
incentives, or other State-approved funding mechanisms.
(E)The funds shall be allocated to the States
on the basis of retail electric sales subject to the renewable electricity
standard under this section or through voluntary participation.
(F)State agencies receiving grants under this
paragraph shall maintain such records and evidence of compliance as the
Secretary may
require.
.
(b)Table of
contents amendmentThe table of contents of the Public Utility
Regulatory Policies Act of 1978 (16 U.S.C. prec. 2601) is amended by adding at
the end of the items relating to title VI the following:
Sec. 609. Rural and remote
communities electrification grants.
Sec. 610. Renewable electricity
standard.
.