BILL REQ. #: S-0934.1
State of Washington | 62nd Legislature | 2011 Regular Session |
Read first time 01/31/11. Referred to Committee on Environment, Water & Energy.
AN ACT Relating to temporarily suspending provisions of the energy independence act during periods of economic downturn; amending RCW 19.285.040; and creating a new section.
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF WASHINGTON:
NEW SECTION. Sec. 1 In 2006, the voters approved a sweeping
environmental law, the energy independence act. While protecting the
environment is of utmost importance, we must balance such regulation
with the ability to maintain jobs and protect our economy. At the time
the initiative was passed, the unemployment rate in Washington was 4.9
percent. Washington's unemployment rate has since skyrocketed to more
than 9.3 percent. It is the legislature's intent to provide utilities
with more time during the continuing economic downturn to meet certain
mandates of the energy independence act and thereby delay the rate
impacts that would be caused by the capital investments to meet such
mandates. This will benefit electricity consumers who cannot currently
afford the increased prices that will be passed onto them as a result
of this legislation. Fortunately, the delay in implementing certain
provisions of this law will be minimal due to Washington's existing
clean energy portfolio, which is recognized as the third cleanest state
in the nation.
Sec. 2 RCW 19.285.040 and 2007 c 1 s 4 are each amended to read
as follows:
(1) Each qualifying utility shall pursue all available conservation
that is cost-effective, reliable, and feasible.
(a) By January 1, 2010, using methodologies consistent with those
used by the Pacific Northwest electric power and conservation planning
council in its most recently published regional power plan, each
qualifying utility shall identify its achievable cost-effective
conservation potential through 2019. At least every two years
thereafter, the qualifying utility shall review and update this
assessment for the subsequent ten-year period.
(b) Beginning January 2010, each qualifying utility shall establish
and make publicly available a biennial acquisition target for cost-effective conservation consistent with its identification of achievable
opportunities in (a) of this subsection, and meet that target during
the subsequent two-year period. At a minimum, each biennial target
must be no lower than the qualifying utility's pro rata share for that
two-year period of its cost-effective conservation potential for the
subsequent ten-year period.
(c) In meeting its conservation targets, a qualifying utility may
count high-efficiency cogeneration owned and used by a retail electric
customer to meet its own needs. High-efficiency cogeneration is the
sequential production of electricity and useful thermal energy from a
common fuel source, where, under normal operating conditions, the
facility has a useful thermal energy output of no less than thirty-three percent of the total energy output. The reduction in load due to
high-efficiency cogeneration shall be: (i) Calculated as the ratio of
the fuel chargeable to power heat rate of the cogeneration facility
compared to the heat rate on a new and clean basis of a
best-commercially available technology combined-cycle natural gas-fired
combustion turbine; and (ii) counted towards meeting the biennial
conservation target in the same manner as other conservation savings.
(d) The commission may determine if a conservation program
implemented by an investor-owned utility is cost-effective based on the
commission's policies and practice.
(e) The commission may rely on its standard practice for review and
approval of investor-owned utility conservation targets.
(2)(a) Each qualifying utility shall use eligible renewable
resources or acquire equivalent renewable energy credits, or a
combination of both, to meet the following annual targets:
(i) At least three percent of its load by January 1, 2012, and each
year thereafter through December 31, 2015;
(ii) At least nine percent of its load by January 1, 2016, and each
year thereafter through December 31, 2019; and
(iii) At least fifteen percent of its load by January 1, 2020, and
each year thereafter.
(b) A qualifying utility may count distributed generation at double
the facility's electrical output if the utility: (i) Owns or has
contracted for the distributed generation and the associated renewable
energy credits; or (ii) has contracted to purchase the associated
renewable energy credits.
(c) In meeting the annual targets in (a) of this subsection, a
qualifying utility shall calculate its annual load based on the average
of the utility's load for the previous two years.
(d) A qualifying utility shall be considered in compliance with an
annual target in (a) of this subsection if: (i) The utility's weather-adjusted load for the previous three years on average did not increase
over that time period; (ii) after December 7, 2006, the utility did not
commence or renew ownership or incremental purchases of electricity
from resources other than renewable resources other than on a daily
spot price basis and the electricity is not offset by equivalent
renewable energy credits; and (iii) the utility invested at least one
percent of its total annual retail revenue requirement that year on
eligible renewable resources, renewable energy credits, or a
combination of both.
(e) The requirements of this section may be met for any given year
with renewable energy credits produced during that year, the preceding
year, or the subsequent year. Each renewable energy credit may be used
only once to meet the requirements of this section.
(f) In complying with the targets established in (a) of this
subsection, a qualifying utility may not count:
(i) Eligible renewable resources or distributed generation where
the associated renewable energy credits are owned by a separate entity;
or
(ii) Eligible renewable resources or renewable energy credits
obtained for and used in an optional pricing program such as the
program established in RCW 19.29A.090.
(g) Where fossil and combustible renewable resources are cofired in
one generating unit located in the Pacific Northwest where the cofiring
commenced after March 31, 1999, the unit shall be considered to produce
eligible renewable resources in direct proportion to the percentage of
the total heat value represented by the heat value of the renewable
resources.
(h)(i) A qualifying utility that acquires an eligible renewable
resource or renewable energy credit may count that acquisition at one
and two-tenths times its base value:
(A) Where the eligible renewable resource comes from a facility
that commenced operation after December 31, 2005; and
(B) Where the developer of the facility used apprenticeship
programs approved by the council during facility construction.
(ii) The council shall establish minimum levels of labor hours to
be met through apprenticeship programs to qualify for this extra
credit.
(i) A qualifying utility shall be considered in compliance with an
annual target in (a) of this subsection if events beyond the reasonable
control of the utility that could not have been reasonably anticipated
or ameliorated prevented it from meeting the renewable energy target.
Such events include weather-related damage, mechanical failure,
strikes, lockouts, and actions of a governmental authority that
adversely affect the generation, transmission, or distribution of an
eligible renewable resource under contract to a qualifying utility.
(j)(i) On the effective date of this section, a qualifying utility
is deemed in compliance with the annual target in (a)(i) of this
subsection regardless of whether or not it has acquired an amount of
eligible renewable resources or renewable energy credits equal to three
percent of its load.
(ii) A qualifying utility is considered in compliance with the
applicable annual target in (a)(ii) and (iii) of this subsection for
the given year and the succeeding four years if at any time during the
given year, the state unemployment rate is above six percent.
(iii) Any investment made by an investor-owned utility in eligible
renewable resources or renewable energy credits to comply with an
annual target in (a) of this subsection, made prior to the given year,
must be considered for recovery in rates by the commission as if the
annual target dates in (a) of this subsection had not been delayed
pursuant to this subsection (2)(j). Nothing in this subsection (2)(j)
may be construed as preventing a qualifying utility from acquiring
generation resources, including eligible renewable resources, in order
to meet its load growth projections.
(3) Utilities that become qualifying utilities after December 31,
2006, shall meet the requirements in this section on a time frame
comparable in length to that provided for qualifying utilities as of
December 7, 2006.