SF 2971

1st Unofficial Engrossment - 86th Legislature (2009 - 2010) Posted on 12/26/2012 11:17pm

1.1A bill for an act

1.2relating to energy; removing moratorium on construction of nuclear power plant;
1.3modifying considerations for implementing energy standard; modifying provision
1.4related to software developed by the state; making technical changes related to
1.5utility report filings, hydrogen energy projects, weatherization programs, public
1.6utility commission assessments, and utility metering for supportive housing;
1.7removing obsolete and redundant language;amending Minnesota Statutes
1.82008, sections 16E.15, subdivision 2; 216B.1691, subdivision 2b; 216B.241,
1.9subdivision 2; 216B.243, subdivision 3b; 216B.812, subdivision 2; 216C.264;
1.10216E.18, subdivision 3; 326B.106, subdivision 12; proposing coding for new law
1.11in Minnesota Statutes, chapter 216B; repealing Minnesota Statutes 2008, sections
1.12216C.19, subdivisions 2, 3, 13, 14, 15, 16, 18, 19, 20; 216C.262; Minnesota
1.13Statutes 2009 Supplement, section 216C.19, subdivision 17.
1.14BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MINNESOTA:

1.15    Section 1. Minnesota Statutes 2008, section 16E.15, subdivision 2, is amended to read:
1.16    Subd. 2. Software sale fund. (a) Except as provided in paragraphs paragraph (b)
1.17and (c), proceeds of the sale or licensing of software products or services by the chief
1.18information officer must be credited to the enterprise technology revolving fund. If a state
1.19agency other than the Office of Enterprise Technology has contributed to the development
1.20of software sold or licensed under this section, the chief information officer may reimburse
1.21the agency by discounting computer services provided to that agency.
1.22(b) Proceeds of the sale or licensing of software products or services developed by
1.23the Pollution Control Agency, or custom developed by a vendor for the agency, must be
1.24credited to the environmental fund.
1.25(c) Proceeds of the sale or licensing of software products or services developed by
1.26the Department of Education, or custom developed by a vendor for the agency, to support
1.27the achieved savings assessment program, must be appropriated to the commissioner of
1.28education and credited to the weatherization program to support weatherization activities.

2.1    Sec. 2. Minnesota Statutes 2008, section 216B.1691, subdivision 2b, is amended to
2.2read:
2.3    Subd. 2b. Modification or delay of standard. (a) The commission shall modify or
2.4delay the implementation of a standard obligation, in whole or in part, if the commission
2.5determines it is in the public interest to do so. The commission, when requested to modify
2.6or delay implementation of a standard, must consider:
2.7(1) the impact of implementing the standard on its customers' utility costs, including
2.8the economic and competitive pressure on the utility's customers;
2.9(2) the effects of implementing the standard on the reliability of the electric system;
2.10(3) technical advances or technical concerns;
2.11(4) delays in acquiring sites or routes due to rejection or delays of necessary siting or
2.12other permitting approvals;
2.13(5) the availability of suitable sites for the location of eligible energy technology
2.14facilities, considering local land use restrictions;
2.15(6) delays, cancellations, or nondelivery of necessary equipment for construction or
2.16commercial operation of an eligible energy technology facility;
2.17(6) (7) transmission constraints preventing delivery of service; and
2.18(7) (8) other statutory obligations imposed on the commission or a utility.
2.19The commission may modify or delay implementation of a standard obligation under
2.20clauses (1) to (3) only if it finds implementation would cause significant rate impact,
2.21requires significant measures to address reliability, or raises significant technical issues.
2.22The commission may modify or delay implementation of a standard obligation under
2.23clauses (4) to (6) only if it finds that the circumstances described in those clauses were due
2.24to circumstances beyond an electric utility's control and make compliance not feasible.
2.25    (b) When considering whether to delay or modify implementation of a standard
2.26obligation, the commission must give due consideration to a preference for electric
2.27generation through use of eligible energy technology and to the achievement of the
2.28standards set by this section.
2.29(c) An electric utility requesting a modification or delay in the implementation of a
2.30standard must file a plan to comply with its standard obligation in the same proceeding
2.31that it is requesting the delay.
2.32EFFECTIVE DATE.This section is effective the day following final enactment.

2.33    Sec. 3. [216B.1695] NUCLEAR POWER PLANT; COST RECOVERY.
3.1(a) The commission may not allow any of the following costs attributable to the
3.2construction of a nuclear generating plant begun after July 1, 2010, to be recovered from
3.3Minnesota ratepayers until the plant begins operating at a monthly load capacity factor of
3.4at least 85 percent:
3.5(1) planning, design, safety, environmental, or engineering studies undertaken prior
3.6to construction; or
3.7(2) the costs of obtaining regulatory approval, including permits, licenses and any
3.8other approval required prior to construction from federal, state and local authorities.
3.9(b) The commission may not allow any of the following costs attributable to the
3.10construction of a nuclear generating plant begun after July 1, 2010, to be recovered from
3.11Minnesota ratepayers:
3.12(1) any construction costs exceeding the projected construction cost of the generating
3.13plant and any ancillary facility constructed by the utility to temporarily or permanently
3.14store nuclear waste generated by the plant, as identified in the utility's certificate of need
3.15application submitted under section 216B.243;
3.16(2) the costs of insuring the plant against accidents that exceed the cost of insurance
3.17for a fossil fuel plant of equivalent capacity; or
3.18(3) contributions from the plant to provide and maintain local fire protection and
3.19emergency services to the plant in case of an accident.
3.20(c) Except for regulatory costs of state agencies, no revenues from taxes or
3.21fees imposed by the state of Minnesota may be used to pay for any portion of the
3.22preconstruction, construction, maintenance, or operating costs of a nuclear generating
3.23plant, or to assume any financial risk associated with an accidental release of radioactivity
3.24from the generating plant or an ancillary facility constructed by the utility that owns the
3.25generating plant to temporarily or permanently store nuclear waste generated by the plant.

3.26    Sec. 4. Minnesota Statutes 2008, section 216B.241, subdivision 2, is amended to read:
3.27    Subd. 2. Programs. (a) The commissioner may require public utilities to make
3.28investments and expenditures in energy conservation improvements, explicitly setting
3.29forth the interest rates, prices, and terms under which the improvements must be offered to
3.30the customers. The required programs must cover no more than a three-year period. Public
3.31utilities shall file conservation improvement plans by June 1, on a schedule determined by
3.32order of the commissioner, but at least every three years. Plans received by a public utility
3.33by June 1 must be approved or approved as modified by the commissioner by December
3.341 of that same year. The commissioner shall evaluate the program on the basis of
3.35cost-effectiveness and the reliability of technologies employed. The commissioner's order
4.1must provide to the extent practicable for a free choice, by consumers participating in the
4.2program, of the device, method, material, or project constituting the energy conservation
4.3improvement and for a free choice of the seller, installer, or contractor of the energy
4.4conservation improvement, provided that the device, method, material, or project seller,
4.5installer, or contractor is duly licensed, certified, approved, or qualified, including under
4.6the residential conservation services program, where applicable.
4.7    (b) The commissioner may require a utility to make an energy conservation
4.8improvement investment or expenditure whenever the commissioner finds that the
4.9improvement will result in energy savings at a total cost to the utility less than the cost
4.10to the utility to produce or purchase an equivalent amount of new supply of energy. The
4.11commissioner shall nevertheless ensure that every public utility operate one or more
4.12programs under periodic review by the department.
4.13    (c) Each public utility subject to subdivision 1a may spend and invest annually up to
4.14ten percent of the total amount required to be spent and invested on energy conservation
4.15improvements under this section by the utility on research and development projects
4.16that meet the definition of energy conservation improvement in subdivision 1 and that
4.17are funded directly by the public utility.
4.18    (d) A public utility may not spend for or invest in energy conservation improvements
4.19that directly benefit a large energy facility or a large electric customer facility for which
4.20the commissioner has issued an exemption pursuant to subdivision 1a, paragraph (b).
4.21The commissioner shall consider and may require a utility to undertake a program
4.22suggested by an outside source, including a political subdivision, a nonprofit corporation,
4.23or community organization.
4.24    (e) A utility, a political subdivision, or a nonprofit or community organization
4.25that has suggested a program, the attorney general acting on behalf of consumers and
4.26small business interests, or a utility customer that has suggested a program and is not
4.27represented by the attorney general under section 8.33 may petition the commission to
4.28modify or revoke a department decision under this section, and the commission may do
4.29so if it determines that the program is not cost-effective, does not adequately address the
4.30residential conservation improvement needs of low-income persons, has a long-range
4.31negative effect on one or more classes of customers, or is otherwise not in the public
4.32interest. The commission shall reject a petition that, on its face, fails to make a reasonable
4.33argument that a program is not in the public interest.
4.34    (f) The commissioner may order a public utility to include, with the filing of the
4.35utility's proposed conservation improvement plan under paragraph (a) annual status
4.36report, the results of an independent audit of all or a selection of the utility's conservation
5.1improvement programs and expenditures performed by the department or an auditor
5.2with experience in the provision of energy conservation and energy efficiency services
5.3approved by the commissioner and chosen by the utility. The audit must specify the
5.4energy savings or increased efficiency in the use of energy within the service territory of
5.5the utility that is the result of the spending and investments. The audit must evaluate the
5.6cost-effectiveness of the utility's conservation programs.

5.7    Sec. 5. Minnesota Statutes 2008, section 216B.243, subdivision 3b, is amended to read:
5.8    Subd. 3b. Nuclear power plant; new construction prohibited; relicensing.
5.9(a) The commission may not issue a certificate of need for the construction of a new
5.10nuclear-powered electric generating plant provided that the certificate of need application
5.11contains a separate estimate of preconstruction and construction costs that does not include
5.12any of the costs identified in section 216B.1695, paragraphs (a) and (b).
5.13(b) Any certificate of need for additional storage of spent nuclear fuel for a facility
5.14seeking a license extension shall address the impacts of continued operations over the
5.15period for which approval is sought.

5.16    Sec. 6. Minnesota Statutes 2008, section 216B.812, subdivision 2, is amended to read:
5.17    Subd. 2. Pilot projects. (a) In consultation with appropriate representatives from
5.18state agencies, local governments, universities, businesses, and other interested parties, the
5.19Department of Commerce shall report back to the legislature by November 1, 2005, and
5.20every two years thereafter, with develop a slate of proposed pilot projects that contribute
5.21to realizing Minnesota's hydrogen economy goal as set forth in section 216B.8109. The
5.22Department of Commerce must consider the following nonexclusive list of priorities in
5.23developing the proposed slate of pilot projects:
5.24    (1) deploy "bridge" technologies such as hybrid-electric, off-road, and fleet vehicles
5.25running on hydrogen or fuels blended with hydrogen;
5.26    (2) lead to cost-competitive, on-site renewable hydrogen production technologies;
5.27    (3) demonstrate nonvehicle applications for hydrogen;
5.28    (4) improve the cost and efficiency of hydrogen from renewable energy sources; and
5.29    (5) improve the cost and efficiency of hydrogen production using direct solar energy
5.30without electricity generation as an intermediate step.
5.31    (b) For deployment projects that do not involve a demonstration component,
5.32individual system components of the technology should, if feasible, meet commercial
5.33performance standards and systems modeling must be completed to predict commercial
6.1performance, risk, and synergies. In addition, the proposed pilots should meet as many of
6.2the following criteria as possible:
6.3    (1) advance energy security;
6.4    (2) capitalize on the state's native resources;
6.5    (3) result in economically competitive infrastructure being put in place;
6.6    (4) be located where it will link well with existing and related projects and be
6.7accessible to the public, now or in the future;
6.8    (5) demonstrate multiple, integrated aspects of renewable hydrogen infrastructure;
6.9    (6) include an explicit public education and awareness component;
6.10    (7) be scalable to respond to changing circumstances and market demands;
6.11    (8) draw on firms and expertise within the state where possible;
6.12    (9) include an assessment of its economic, environmental, and social impact; and
6.13    (10) serve other needs beyond hydrogen development.

6.14    Sec. 7. Minnesota Statutes 2008, section 216C.264, is amended to read:
6.15216C.264 COORDINATING RESIDENTIAL WEATHERIZATION
6.16PROGRAMS.
6.17    Subdivision 1. Agency designation. The department is the state agency to apply
6.18for, receive, and disburse money made available to the state by federal law for the purpose
6.19of weatherizing the residences of low-income persons. The commissioner must coordinate
6.20available federal money with state money appropriated for this purpose.
6.21    Subd. 2. Grants. The commissioner must make grants of federal and state money
6.22to community action agencies and other public or private nonprofit agencies for the
6.23purpose of weatherizing the residences of low-income persons. Grant applications must
6.24be submitted in accordance with rules promulgated by the commissioner.
6.25    Subd. 3. Benefits of weatherization. In the case of any grant made to an owner of a
6.26rental dwelling unit for weatherization, the commissioner must require that (1) the benefits
6.27of weatherization assistance in connection with the dwelling unit accrue primarily to the
6.28low-income family that resides in the unit; (2) the rents on the dwelling unit will not be
6.29raised because of any increase in value due solely to the weatherization assistance; and (3)
6.30no undue or excessive enhancement will occur to the value of the dwelling unit.
6.31    Subd. 4. Rules. The commissioner must promulgate rules that describe procedures
6.32for the administration of grants, data to be reported by grant recipients, and compliance
6.33with relevant federal regulations. The commissioner must require that a rental unit
6.34weatherized under this section be rented to a household meeting the income limits of
6.35the program for 24 of the 36 months after weatherization is complete. In applying this
7.1restriction to multiunit buildings weatherized under this section, the commissioner must
7.2require that occupancy continue to reflect the proportion of eligible households in the
7.3building at the time of weatherization.
7.4    Subd. 5. Grant allocation. The commissioner must distribute supplementary
7.5state grants in a manner consistent with the goal of producing the maximum number of
7.6weatherized units. Supplementary state grants are provided primarily for the payment of
7.7additional labor costs for the federal weatherization program, and as an incentive for the
7.8increased production of weatherized units.
7.9Criteria for the allocation of state grants to local agencies include existing local
7.10agency production levels, emergency needs, and the potential for maintaining or increasing
7.11acceptable levels of production in the area.
7.12An eligible local agency may receive advance funding for 90 days' production, but
7.13thereafter must receive grants solely on the basis of program criteria.
7.14    Subd. 6. Eligibility criteria. To the extent allowed by federal regulations, the
7.15commissioner must ensure that the same income eligibility criteria apply to both the
7.16weatherization program and the energy assistance program.

7.17    Sec. 8. Minnesota Statutes 2008, section 216E.18, subdivision 3, is amended to read:
7.18    Subd. 3. Funding; assessment. The commission shall finance its baseline studies,
7.19general environmental studies, development of criteria, inventory preparation, monitoring
7.20of conditions placed on site and route permits, and all other work, other than specific site
7.21and route designation, from an assessment made quarterly, at least 30 days before the start
7.22of each quarter, by the commission against all utilities with annual retail kilowatt-hour
7.23sales greater than 4,000,000 kilowatt-hours in the previous calendar year.
7.24Each share shall be determined as follows: (1) the ratio that the annual retail
7.25kilowatt-hour sales in the state of each utility bears to the annual total retail kilowatt-hour
7.26sales in the state of all these utilities, multiplied by 0.667, plus (2) the ratio that the annual
7.27gross revenue from retail kilowatt-hour sales in the state of each utility bears to the annual
7.28total gross revenues from retail kilowatt-hour sales in the state of all these utilities,
7.29multiplied by 0.333, as determined by the commission. The assessment shall be credited
7.30to the special revenue fund and shall be paid to the state treasury within 30 days after
7.31receipt of the bill, which shall constitute notice of said assessment and demand of payment
7.32thereof. The total amount which may be assessed to the several utilities under authority
7.33of this subdivision shall not exceed the sum of the annual budget of the commission
7.34for carrying out the purposes of this subdivision. The assessment for the second third
7.35quarter of each fiscal year shall be adjusted to compensate for the amount by which actual
8.1expenditures by the commission for the preceding fiscal year were more or less than the
8.2estimated expenditures previously assessed.

8.3    Sec. 9. Minnesota Statutes 2008, section 326B.106, subdivision 12, is amended to read:
8.4    Subd. 12. Separate metering for electric service. The standards concerning heat
8.5loss, illumination, and climate control adopted pursuant to subdivision 1, shall require
8.6that electrical service to individual dwelling units in buildings containing two or more
8.7units be separately metered, with individual metering readily accessible to the individual
8.8occupants. The standards authorized by this subdivision shall only apply to buildings
8.9constructed after the effective date of the amended standards. Buildings intended for
8.10occupancy primarily by persons who are 62 years of age or older or disabled, supportive
8.11housing, or which buildings that contain a majority of units not equipped with complete
8.12kitchen facilities, shall be exempt from the provisions of this subdivision. For purposes
8.13of this section, "supportive housing" means housing made available to individuals and
8.14families with multiple barriers to obtaining and maintaining housing, including those who
8.15are formerly homeless or at risk of homelessness and those who have a mental illness,
8.16substance abuse disorder, debilitating disease, or a combination of these conditions.

8.17    Sec. 10. REPEALER.
8.18Minnesota Statutes 2008, sections 216C.19, subdivisions 2, 3, 13, 14, 15, 16, 18,
8.1919, and 20; and 216C.262, are repealed.
8.20Minnesota Statutes 2009 Supplement, section 216C.19, subdivision 17, is repealed.