1.1                          A bill for an act 
  1.2             relating to state government; authorizing guaranteed 
  1.3             energy savings contracts; proposing coding for new law 
  1.4             in Minnesota Statutes, chapter 16C. 
  1.5   BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MINNESOTA: 
  1.6      Section 1.  [16C.144] [GUARANTEED ENERGY SAVINGS 
  1.7   CONTRACTS.] 
  1.8      Subdivision 1.  [DEFINITIONS.] (a) The definitions in this 
  1.9   subdivision apply to this section.  
  1.10     (b) "Energy conservation measure" means a training program 
  1.11  or facility alteration designed to reduce energy consumption or 
  1.12  operating costs and includes: 
  1.13     (1) insulation of the building structure and systems within 
  1.14  the building; 
  1.15     (2) storm windows and doors, caulking or weatherstripping, 
  1.16  multiglazed windows and doors, heat absorbing or heat reflective 
  1.17  glazed and coated window and door systems, additional glazing, 
  1.18  reductions in glass area, and other window and door system 
  1.19  modifications that reduce energy consumption; 
  1.20     (3) automatic energy control systems; 
  1.21     (4) heating, ventilating, or air conditioning system 
  1.22  modifications or replacements; 
  1.23     (5) replacement or modifications of lighting fixtures to 
  1.24  increase the energy efficiency of the lighting system without 
  1.25  increasing the overall illumination of a facility, unless an 
  2.1   increase in illumination is necessary to conform to the 
  2.2   applicable state or local building code for the lighting system 
  2.3   after the proposed modifications are made; 
  2.4      (6) energy recovery systems; 
  2.5      (7) cogeneration systems that produce steam or forms of 
  2.6   energy such as heat, as well as electricity, for use primarily 
  2.7   within a building or complex of buildings; and 
  2.8      (8) energy conservation measures that provide long-term 
  2.9   operating cost reductions.  
  2.10     (c) "Guaranteed energy savings contract" means a contract 
  2.11  for the evaluation and recommendations of energy conservation 
  2.12  measures, and for one or more energy conservation measures.  The 
  2.13  contract must provide that all payments, except obligations on 
  2.14  termination of the contract before its expiration, are to be 
  2.15  made over time, but not to exceed ten years from the date of 
  2.16  final installation, and that savings are guaranteed to the 
  2.17  extent necessary to make payments for the systems. 
  2.18     (d) "Qualified provider" means a person or business 
  2.19  experienced in the design, implementation, and installation of 
  2.20  energy conservation measures.  A qualified provider to whom the 
  2.21  contract is awarded shall give a sufficient bond to the 
  2.22  commissioner for its faithful performance. 
  2.23     Subd. 2.  [CONTRACT.] The commissioner may enter into a 
  2.24  guaranteed energy savings contract with a qualified provider to 
  2.25  significantly reduce energy or operating costs. 
  2.26     Before installation of equipment, modification, or 
  2.27  remodeling, the qualified provider shall first issue a report, 
  2.28  summarizing estimates of all costs of installations, 
  2.29  modifications, or remodeling, including costs of design, 
  2.30  engineering, installation, maintenance, repairs, or debt 
  2.31  service, and estimates of the amounts by which energy or 
  2.32  operating costs will be reduced. 
  2.33     A guaranteed energy savings contract that includes a 
  2.34  written guarantee that savings will meet or exceed the cost of 
  2.35  energy conservation measures is not subject to the competitive 
  2.36  bidding requirements of section 16C.06. 
  3.1      The commissioner may enter into a guaranteed energy savings 
  3.2   contract with a qualified provider if, after review of the 
  3.3   report, the commissioner finds that the amount that would be 
  3.4   spent on the energy conservation measures recommended in the 
  3.5   report is not likely to exceed the amount to be saved in energy 
  3.6   and operation costs over ten years from the date of installation 
  3.7   if the recommendations in the report were followed, and the 
  3.8   qualified provider provides a written guarantee that the energy 
  3.9   or operating cost savings will meet or exceed the costs of the 
  3.10  system.  The guaranteed energy savings contract may provide for 
  3.11  payments over a period of time, not to exceed 15 years.