[Congressional Bills 114th Congress]
[From the U.S. Government Publishing Office]
[S. 2003 Introduced in Senate (IS)]
114th CONGRESS
1st Session
S. 2003
To facilitate the free market for distributed energy resources.
_______________________________________________________________________
IN THE SENATE OF THE UNITED STATES
August 6, 2015
Mr. King introduced the following bill; which was read twice and
referred to the Committee on Energy and Natural Resources
_______________________________________________________________________
A BILL
To facilitate the free market for distributed energy resources.
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 ``Free Market Energy Act''.
SEC. 2. DEFINITION OF DISTRIBUTED ENERGY RESOURCE.
Section 3 of the Federal Power Act (16 U.S.C. 796) is amended by
adding at the end the following:
``(30) Distributed energy resource.--The term `distributed
energy resource' means a resource, technology, or service
interconnected to the electricity distribution system that
generates, manages, or reduces energy use.''.
SEC. 3. GENERAL RIGHT TO NEUTRALITY OF INTERCONNECTION.
The Public Utility Regulatory Policies Act of 1978 is amended by
inserting after section 4 (16 U.S.C. 2603) the following:
``SEC. 5. GENERAL RIGHT TO NEUTRALITY OF INTERCONNECTION.
``(a) In General.--Distributed energy resources (as defined in
section 3 of the Federal Power Act (16 U.S.C. 796)) shall have a
general right of interconnection under this Act.
``(b) Rates and Fees.--States shall ensure that electric
distribution grid operators adopt standards, conditions, and
requirements for rates and fees for interconnection of distributed
energy resources under this Act, that--
``(1) are just and reasonable;
``(2) provide for the 2-way benefit for the distributed
energy resource and the electricity grid; and
``(3) shall not be punitive.
``(c) Timeframes.--
``(1) In general.--Timeframes for interconnection of
distributed energy resources under this Act shall be well-
defined, expeditious, and not unduly protracted.
``(2) Delays or denial.--An interconnection of distributed
energy resources under this Act shall not be delayed or denied
unless the electric utility demonstrates that the
interconnection is unsafe or impracticable.''.
SEC. 4. ENERGY AND RATE TREATMENTS FOR DISTRIBUTED ENERGY RESOURCES.
Section 111(d) of the Public Utility Regulatory Policies Act of
1978 (16 U.S.C. 2621(d)) is amended by adding at the end the following:
``(20) Distributed energy resources.--
``(A) In general.--If a State regulatory authority
considers, through a rate proceeding or another
mechanism (such as consideration of fixed or minimum
charges), modifying the treatment of net energy
metering customers, the State regulatory authority
shall consider requiring that distributed energy
resources (as defined in section 3 of the Federal Power
Act (16 U.S.C. 796)) be eligible to receive just and
reasonable energy and rate treatment using dynamic
pricing, which may account for locational benefit, to
be provided on an unbundled basis, after accounting for
the 2-way valuation of dynamic rates, for services
provided to or provided by the grid, including the
considerations with respect to the use of dynamic
pricing described in subparagraph (B).
``(B) Considerations.--The considerations for the
use of dynamic pricing referred to in subparagraph (A)
include--
``(i)(I) pricing for energy sold to an
electric utility; and
``(II) pricing for energy purchased from an
electric utility;
``(ii) capacity;
``(iii) the provision of ancillary
services;
``(iv) the societal value of distributed
energy resources;
``(v) transmission and distribution losses;
and
``(vi) any other benefits that the State
regulatory authority considers to be
appropriate.''.
SEC. 5. CONSIDERATION OF NONTRANSMISSION ALTERNATIVES.
Section 111(d) of the Public Utility Regulatory Policies Act of
1978 (16 U.S.C. 2621(d)) (as amended by section 4) is amended by adding
at the end the following:
``(21) Nontransmission alternatives.--
``(A) In general.--Each State regulatory authority
or applicable Regional Transmission Organization or
Independent System Operator shall consider
nontransmission alternatives in instances in which an
entity proposes transmission projects seeking cost-of-
service rate recovery.
``(B) Cost.--To reduce the cost to the ratepayer of
a potential transmission upgrade, a nontransmission
alternative considered under subparagraph (A), the cost
of the nontransmission alternative shall be recovered
from the ratebase or regional recovery mechanism in the
same manner as the transmission upgrade would have
been.''.
SEC. 6. PRIOR STATE ACTIONS.
(a) In General.--Section 112 of the Public Utility Regulatory
Policies Act of 1978 (16 U.S.C. 2622) is amended by adding at the end
the following:
``(g) Prior State Actions.--Subsections (b) and (c) shall not apply
to a standard established under paragraphs (20) and (21) of section
111(d) in the case of any electric utility in a State if, before the
date of enactment of this subsection--
``(1) the State has implemented for the electric utility
the standard (or a comparable standard);
``(2) the State regulatory authority for the State, or the
relevant nonregulated electric utility, has conducted a
proceeding to consider implementation of the standard (or a
comparable standard) for the electric utility; or
``(3) the State legislature has voted on the implementation
of the standard (or a comparable standard) for the electric
utility.''.
(b) Cross-Reference.--Section 124 of the Public Utility Regulatory
Policies Act of 1978 (16 U.S.C. 2634) is amended by adding at the end
the following: ``In the case of each standard established under
paragraphs (20) and (21) of section 111(d), the reference contained in
this subsection to the date of enactment of this Act shall be deemed to
be a reference to the date of enactment of those paragraphs.''.
SEC. 7. EFFECT.
Nothing in this Act (or an amendment made by this Act) shall apply
to distributed energy resource contracts in effect on the date of
enactment of this Act.
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