Bill Text: PA HB1909 | 2009-2010 | Regular Session | Introduced

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Bill Title: Providing for the appointment and duties of a Commonwealth Energy Advocate; establishing and providing for the powers and duties of the Commonwealth Energy Procurement and Development Agency; and establishing the Energy Procurement and Development Fund.

Spectrum: Partisan Bill (Democrat 23-1)

Status: (Introduced - Dead) 2010-09-14 - Re-committed to APPROPRIATIONS [HB1909 Detail]

Download: Pennsylvania-2009-HB1909-Introduced.html

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PRINTER'S NO. 2554
THE GENERAL ASSEMBLY OF PENNSYLVANIA
HOUSE BILL
No. 1909 Session of2009
INTRODUCED BY GEORGE, BELFANTI, CALTAGIRONE, CONKLIN, DONATUCCI, FABRIZIO, FREEMAN, GIBBONS, GOODMAN, HARKINS, HORNAMAN, CARROLL, JOSEPHS, LEVDANSKY, MAHONEY, McILVAINE SMITH, MUNDY, MURT, MYERS, READSHAW, K. SMITH, WALKO AND WHITE, AUGUST 6, 2009
REFERRED TO COMMITTEE ON ENVIRONMENTAL RESOURCES AND ENERGY, AUGUST 6, 2009
AN ACT
Amending the act of April 9, 1929 (P.L.177, No.175), entitled
"An act providing for and reorganizing the conduct of the
executive and administrative work of the Commonwealth by the
Executive Department thereof and the administrative
departments, boards, commissions, and officers thereof,
including the boards of trustees of State Normal Schools, or
Teachers Colleges; abolishing, creating, reorganizing or
authorizing the reorganization of certain administrative
departments, boards, and commissions; defining the powers and
duties of the Governor and other executive and administrative
officers, and of the several administrative departments,
boards, commissions, and officers; fixing the salaries of the
Governor, Lieutenant Governor, and certain other executive
and administrative officers; providing for the appointment of
certain administrative officers, and of all deputies and
other assistants and employes in certain departments, boards,
and commissions; and prescribing the manner in which the
number and compensation of the deputies and all other
assistants and employes of certain departments, boards and
commissions shall be determined," providing for the
appointment and duties of a Commonwealth Energy Advocate;
establishing and providing for the powers and duties of the
Commonwealth Energy Procurement and Development Agency; and
establishing the Energy Procurement and Development Fund.
The General Assembly of the Commonwealth of Pennsylvania
hereby enacts as follows:
Section 1. The act of April 9, 1929 (P.L.177, No.175), known
as The Administrative Code of 1929, is amended by adding a
section to read:
Section 903-A.1. Commonwealth Energy Advocate.--(a) The
Consumer Advocate, with the approval of the Attorney General,
shall appoint a Commonwealth Energy Advocate. The compensation
of the Commonwealth Energy Advocate and staff shall be set by
the board of directors of the Commonwealth Energy Procurement
and Development Agency under section 2804-D(b). The Commonwealth
Energy Advocate shall not, while serving in such position,
engage in any business, vocation or other employment or have
other interests inconsistent with the advocate's official
responsibilities.
(b) The duties of the Commonwealth Energy Advocate shall be:
(1) To monitor the activities of the Federal Energy
Regulatory Commission, Congress and other Federal agencies and
advocate on behalf of the interests of retail electric customers
in this Commonwealth to assure that wholesale electric power
markets operate efficiently, effectively and in the best
interest of retail customers.
(2) To participate in the governance process for the
regional transmission organizations serving areas of this
Commonwealth and advocate on behalf of retail electric customers
in this Commonwealth.
(3) To consult with and report to the board of directors of
the agency on a monthly basis regarding the advocate's
activities.
(4) To provide an annual report to the board of directors of
the Commonwealth Energy Procurement and Development Agency
summarizing the advocate's activities.
Section 2. The act is amended by adding an article to read:
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ARTICLE XXVIII-D
POWERS AND DUTIES OF THE COMMONWEALTH ENERGY PROCUREMENT AND
DEVELOPMENT AGENCY
Section 2801-D. Short title of article.
This article shall be known and may be cited as the
Commonwealth Energy Procurement and Development Agency Act.
Section 2802-D. Legislative findings and declarations.
The General Assembly finds and declares as follows:
(1) The health, welfare and prosperity of all citizens
of this Commonwealth require the provision of adequate,
reliable and affordable electric service at the lowest total
cost over time, taking into account any benefits of price
stability.
(2) Escalating or volatile prices for electricity in
this Commonwealth pose a serious threat to the economic well-
being, health and safety of residents, commerce and industry
of this Commonwealth.
(3) The cost of electricity is an important factor in
decisions made by businesses concerning locating, expanding
and retaining facilities in this Commonwealth.
(4) To protect against this threat to economic well-
being, health and safety, it is necessary to improve the
process of procuring electricity to serve the residents and
businesses of this Commonwealth and to support the
development of economical generation resources.
(5) Procuring a diverse electricity supply portfolio
will ensure the lowest total cost over time for adequate and
reliable electric service.
Section 2803-D. Definitions.
The following words and phrases when used in this article
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shall have the meanings given to them in this section unless the
context clearly indicates otherwise:
"Agency." The Commonwealth Energy Procurement and
Development Agency established under section 2804-D.
"Board." The board of directors of the Commonwealth Energy
Procurement and Development Agency.
"Consumer." As defined in 66 Pa.C.S. § 2803 (relating to
definitions).
"Customer." As defined in 66 Pa.C.S. § 2803 (relating to
definitions).
"Default service." Generation service provided to retail
electric customers who:
(1) contract for electric power, including energy and
capacity, and the chosen electric generation supplier, as
defined under 66 Pa.C.S. § 2803 (relating to definitions),
does not supply the service; or
(2) do not choose an alternative electric generation
supplier.
"Directly competing customer." A customer that makes the
same end product or offers the same service for the same general
group of customers. A customer shall not be considered a direct
competitor solely because it produces component products of the
same end product.
"Electric distribution company." As defined in 66 Pa.C.S. §
2803 (relating to definitions).
"Fund." The Energy Procurement and Development Fund
established in section 2809-D.
"Rebate." The generation rebate established under section
2809-D(c).
Section 2804-D. Commonwealth Energy Procurement and Development
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Agency.
(a) Establishment.--There is hereby established the
Commonwealth Energy Procurement and Development Agency. The
exercise of the powers conferred on the agency under section
2806-D shall constitute the performance of a public and
essential governmental function.
(b) Board of directors.--The agency shall be governed and
all of its powers exercised by a board of directors which shall
be composed of the following:
(1) The Consumer Advocate or a designee.
(2) The Small Business Advocate or a designee.
(3) One representative who shall be appointed by the
Governor from a list of nominations submitted by the
Industrial Energy Consumers of Pennsylvania or its successor.
(4) One representative who shall be appointed by the
President pro tempore of the Senate from a list of
nominations submitted by the Pennsylvania agricultural
community.
(5) One representative who shall be appointed by the
Speaker of the House of Representatives from a list of
nominations submitted by the American Association of Retired
Persons or its successor.
(c) Board compensation and reimbursement.--The members of
the board shall be entitled to no compensation for their
services but shall be entitled to reimbursement for all
necessary expenses incurred in connection with the performance
of their duties.
(d) Board meetings.--The board shall provide for the holding
of regular and special meetings. Three board members attending
shall constitute a quorum for the transaction of any business,
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and a simple majority of votes in attendance shall be required
to adopt any action. Each board member's vote shall be weighted
equally.
(e) Board appointments.--
(1) Board members shall serve a term of five years,
except that the Consumer Advocate and the Small Business
Advocate, or their respective designees, shall serve an
initial term of four years, which shall be followed by a
permanent regular term of five years.
(2) Board members shall be eligible for reappointment.
(3) All appointments shall be made within 90 days of the
effective date of this article, and any appointments to fill
a vacancy shall be made within 60 days of the vacancy.
(f) Conflict of interest.--The board must support and
accomplish the goals of the agency and demonstrate the absence
of a conflict of interest. No board member may, while serving on
the board and for two years before and after serving in the
position, be employed by an electric utility or any entity whose
primary business is engaged in the production or sale of
wholesale or retail electricity.
(g) Board rules.--The board shall provide all rules,
procedures and guidelines necessary for the administration of
the agency, including the conflict of interest policy for agency
employees and procedures related to the control and management
of the money of the agency.
Section 2804.1-D. Goals and objectives.
The goals and objectives of the agency are to accomplish the
following:
(1) Develop electricity procurement plans to ensure
adequate, reliable and affordable electric service at the
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lowest total cost over time, taking into account any benefits
of price stability, for electric distribution companies that
provide electric service in this Commonwealth. The
procurement plans shall be updated annually and ensure that
the costs of providing service to each customer class are not
subsidized by any other class.
(2) Conduct competitive procurement processes to procure
the supply resources identified in the procurement plans.
(3) Acquire or develop electric generation and
cogeneration facilities in this Commonwealth, particularly
facilities that use indigenous resources.
(4) Supply electricity from the agency's facilities at
cost to electric distribution companies for distribution at
cost to one or more of the following:
(i) Default service customers under the procurement
plans specified in section 2805-D(9).
(ii) Eligible commercial and industrial customers as
described in section 2810-D.
Section 2805-D. Duties and obligations.
The agency shall:
(1) Develop electricity procurement plans to ensure
adequate, reliable and affordable electric service at the
lowest total cost over time for default service customers and
commercial and industrial customers eligible for economic
development generation, taking into account any benefits of
price stability, ensuring that the requirements of the act of
November 30, 2004 (P.L.1672, No.213), known as the
Alternative Energy Portfolio Standards Act, are met and
ensuring that the costs of each customer class are not
subsidized by any other class.
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(2) Produce, procure in applicable regional transmission
organization markets or acquire, through the use of contracts
and competitive solicitation, power supply and other related
products to serve Pennsylvania consumers.
(3) Enter into power purchase agreements with new and
existing Pennsylvania-based power plants and industrial
cogeneration facilities.
(4) Enter into long-term power purchase agreements to
facilitate the financing of new Pennsylvania-based power
plants and industrial cogeneration facilities.
(5) Acquire ownership of or ownership interests in
existing and new Pennsylvania-based power plants and
industrial cogeneration facilities through purchase or
construction.
(6) Distribute the agency's default service power
supply, at cost, among Commonwealth electric distribution
companies on an equitable basis. Power supplies shall be
provided by the electric distribution companies at cost to
the default service customers.
(7) Support economic development, including the
retention of jobs at existing commercial and industrial
facilities, by offering generation supply options on a cost-
of-service basis to eligible commercial and industrial
customers that agree to waive the right to switch suppliers
during the term of the arrangement. Power supply shall be
provided at cost to the customer's electric distribution
company, which shall provide the supply at cost to the
particular customer that has entered into the arrangement
with the agency. In performing this function, the agency
shall ensure that directly competing customers are afforded
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similar opportunities on generation supply arrangements
available from the agency.
(8) Determine an appropriate portion of the revenues
raised by the rebate to be distributed to retail customers
through a ratepayer fairness credit, and distribute the
portion on a per-kilowatt-hour basis to electric distribution
companies which shall pass on the ratepayer fairness credit
on the same basis. A ratepayer fairness credit shall be
competitively neutral and distributed to customers on default
service and customers purchasing generation supply from
alternate sources including the facilities owned by or
associated with the agency.
(9) Manage default service acquisition for Commonwealth
electric distribution companies under a least-cost portfolio
approach over time. In performing this function, the agency
shall take into consideration and honor any generation supply
commitments entered by the electric distribution company
prior to the effective date of this article under a
procurement plan approved by the Pennsylvania Public Utility
Commission.
(10) Adopt rules as may be necessary and appropriate for
the operation of the agency, including procedures for
monitoring the administration of any contracts administered
directly or indirectly by the agency, except for executed
contracts between electric distribution companies and their
suppliers.
Section 2806-D. Agency powers.
(a) Powers.--The agency shall have all powers necessary to
engage in any activity that is incidental to and in furtherance
of efficient operation to accomplish the agency's purposes,
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including, but not limited to, the following:
(1) The agency may enter into contracts or transactions
to purchase power supply and other necessary products in
order to procure the supply resources identified in the
procurement plans and may enter into contracts, including
long-term power purchase agreements, to facilitate the
financing or constructing of power plants and industrial
cogeneration facilities in this Commonwealth. All contracts
related to construction of a generating unit shall be awarded
by competitive solicitations.
(2) If the procurement plan specifies the acquisition of
or construction of a generation facility, the agency may take
all necessary actions, through request for proposals or other
agreements where appropriate, to purchase or construct
Pennsylvania-based power plants and industrial cogeneration
facilities. The following apply:
(i) The agency may begin construction of a
generation facility only if the agency demonstrates each
of the following:
(A) After conducting a feasibility study, that
the construction and operation of the facility is
feasible.
(B) That the agency has received all Federal,
State and local government licenses, permits or
approvals necessary to begin construction.
(ii) The agency shall enter into management and
operating agreements for its facility or facilities.
Solicitation for any agreement shall be pursuant to a
request for proposals. The agreements must comply with
the Internal Revenue Code of 1986 (Public Law 99-514, 26
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U.S.C. § 1 et seq.) and its regulations and shall not
jeopardize the tax-exempt status of any bond issued in
connection with a project for which the agency entered
into the agreement.
(iii) The agency shall not own or acquire
distribution or transmission facilities except as
necessary to connect a facility or facilities owned by
the agency, or under long-term contract therewith, to an
electric transmission or distribution system.
(iv) The agency shall purchase an insurance policy
to cover construction and operation costs associated with
the facility. A policy shall remain in effect for the
period under which the agency may accrue any liabilities
associated with the facility.
(v) The agency may sell excess capacity and excess
energy into the wholesale electric market at prevailing
market rates.
(vi) All construction contracts and subcontracts
executed by the agency shall comply with the act of
August 15, 1961 (P.L.987, No.442), known as the
Pennsylvania Prevailing Wage Act.
(3) The agency may use eminent domain only when
necessary to acquire or construct any transmission lines or
transmission-related facilities to connect a facility or
facilities owned by the agency, or under long-term contract
therewith, to a transmission or distribution system in the
manner provided by 26 Pa.C.S. (relating to eminent domain).
(4) The agency may issue limited obligation revenue
bonds and notes and incur debt as needed to effectuate the
purposes of the agency as outlined in this article. The
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following apply:
(i) Bonds may be authorized by resolution of the
board and may be issued by the agency in one or more
series. All such bonds shall bear any date or dates,
mature at any time or times, bear interest at any rate or
rates or at variable rates, be in any denomination or
denominations, be in any form, either coupon or
registered, carry any conversion or registration
privileges, have any rank or priority, be executed in any
manner, be payable from such sources in any medium of
payment at any place or places within or without this
Commonwealth and be subject to any terms of redemption,
purchase or tender by the agency or the holders thereof,
with or without premium. A resolution of the agency
authorizing the issuance of bonds may provide for the
acquisition of credit enhancement devices, such as bond
insurance, letters of credit or any other instruments to
carry out the provisions under this paragraph.
(ii) Bonds shall be sold initially at public sale at
any price or prices and in any manner as the agency may
determine. Any portion of any bond issue so offered and
not sold or subscribed for may be disposed of by private
sale by the agency in such manner and at such prices as
the agency shall determine.
(iii) Whether or not the bonds are a form and
character as to be negotiable instruments under the terms
of 13 Pa.C.S. (relating to Commercial Code), the bonds
are made negotiable instruments within the meaning of and
for the purposes of 13 Pa.C.S., subject only to the
provisions of the bonds for registration.
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(iv) Bonds may be issued under the provisions of
this article without obtaining the consent of any
department, division, board, bureau or agency of the
Commonwealth and without any other proceeding or the
occurrence of any other conditions not specifically
required by this article.
(v) All such bonds and notes issued by the agency
shall be the obligations of the agency payable out of any
revenues, receipts and funds of the agency, subject only
to any agreements with the holders of particular notes or
bonds pledging any particular revenues, receipts and
funds.
(vi) Bonds or notes issued by the agency shall not
be deemed to constitute a debt or liability of the
Commonwealth, any municipality or political subdivision
thereof, or a pledge of the faith and credit or taxing
power of the Commonwealth, any municipality or political
subdivision thereof; all such bonds and notes shall be
payable solely from the revenues and funds pledged or
provided under this section and shall contain on the face
thereof a statement expressing this provision. In
addition, the agreements governing any issue of
indebtedness shall provide that all holders of that
indebtedness have agreed to waive and release all claims
and causes of action against the Commonwealth in respect
of the indebtedness or any project associated therewith
based on any theory of law. However, the waiver shall not
prohibit the holders of indebtedness from filing any
cause of action against or recovering damages from the
agency, recovering from any property or funds pledged to
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secure the indebtedness or recovering from any property
or funds to which the agency holds title if the property
or funds are directly associated with the project for
which the indebtedness was specifically issued.
(vii) The principal of and interest on bonds or
notes issued by the agency may be secured by a pledge of
any revenues, receipts, accounts, funds and other
property of the agency and may be additionally secured by
contracts, mortgages, deeds of trust or security
interests covering all or any part of a project,
including any additions, improvements, extensions to or
enlargements of any projects thereafter made. Such bonds
or notes may also be secured by pledges or assignments of
loan agreements or sale agreements, by assignments of the
lease of any project for the construction and acquisition
of which the bonds or notes are issued and by assignments
of the revenues and receipts derived from such projects.
A pledge of revenues, receipts, accounts, funds,
contracts or any other property made by the agency shall
be valid and binding from the time when the pledge is
made. The revenues, receipts, accounts, funds, contracts
or any other property pledged and thereafter received by
the agency shall be immediately subject to the lien of
the pledge without its physical delivery or further act,
and the lien of any pledge shall be valid and binding as
against all parties having claims of any kind in tort,
contract or otherwise against the agency irrespective of
whether the parties have notice of the lien. Neither the
resolution nor any other instrument by which a pledge
under this paragraph is created or evidenced need be
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filed or recorded except in the records of the agency.
(viii) Issuance by the agency of one or more series
of bonds or notes for one or more purposes shall not
preclude it from issuing other bonds or notes in
connection with the same project or any other projects,
but the proceeding wherein any subsequent bonds or notes
may be issued shall recognize and protect any prior
pledge or mortgage made for any prior issue of bonds or
notes, unless in the resolution authorizing such prior
issue the right is reserved to issue subsequent bonds on
a parity with such prior issue.
(ix) The agency may issue bonds for the purpose of
refunding any bonds of the agency then outstanding,
including the payment of any redemption premium thereon
and any interest accrued or to accrue to the earliest or
subsequent date of redemption, purchase or maturity of
such bonds and, if deemed advisable by the agency, for
the additional purpose of paying all or any part of the
cost of constructing and acquiring additions,
improvements, extensions or enlargements of a project or
any portion thereof. The proceeds of any such bonds
issued for the purpose of refunding outstanding bonds
may, in the discretion of the agency, be applied to the
purchase or retirement at maturity or redemption of such
outstanding bonds either on their earliest or any
subsequent redemption date and may, pending such
application, be placed in escrow to be applied to such
purchase or retirement at maturity or redemption on such
date as may be determined by the agency.
(x) The Commonwealth may not limit or alter the
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rights vested in the agency until its debt obligations,
including the interest thereon, are fully met and
discharged and such contracts are fully performed on the
part of the agency. However, nothing contained in this
subparagraph shall preclude such limitation or alteration
if adequate provision is made by law to protect the
interests of the holders of such bonds and notes of the
agency or those entering into such contracts with the
agency.
(xi) The agency may invest moneys of the agency not
required for immediate use, including proceeds from the
sale of any bonds, notes or other debt instruments, in
such manner as the board shall determine, subject to any
agreement with bondholders stated in the authorizing
resolution providing for the issuance of bonds.
(xii) Neither the directors of the board nor any
person executing the bonds, notes or other such debt
instruments shall be liable personally on the bonds,
notes or other debt instruments or be subject to any
personal liability or accountability by reason of the
issuance thereof.
(xiii) Bonds, notes or other such debt instruments
shall be signed by or shall bear the facsimile signature
of such officers as the agency shall determine, which may
be prescribed in a resolution or resolutions.
(xiv) Bonds, notes or other such debt instruments
may be issued and delivered, notwithstanding that one or
more of the officers signing such bonds, notes or other
debt instruments may have ceased to be such officer or
officers at the time when such bonds, notes or other debt
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instruments are actually delivered.
(5) The agency may hire staff and outside consultants to
implement the agency's activities. Any outside consultants or
firms hired by the agency must support the goals of the
agency and demonstrate the absence of a conflict of interest
or inappropriate bias for or against potential bidders, other
service providers or the affected utilities.
(b) Cooperation and assistance.--Any Commonwealth agency or
department may, to the extent permitted by law, cooperate with
or assist the agency to achieve its goals and objectives.
(c) Execution of duties.--In executing its duties, the
agency shall apply sound economic principles and ensure its
activities meet a cost-benefit analysis.
Section 2806.1-D. Tax-exempt status.
(a) General rule.--The agency shall not be required to pay
any taxes or assessments upon any property or income of the
agency levied by the Commonwealth. In addition, any bonds, notes
or debt instruments issued under the provisions of this article
shall at all times be free from taxation of every kind by the
Commonwealth, the municipalities and all other political
subdivisions having taxing powers of the Commonwealth. However,
the agency shall pay any local property tax or assessment upon
its facility or facilities.
(b) Payments in lieu of taxes.--Any person leasing a project
from the agency shall pay the municipality or other political
subdivision having taxing powers, in which such project is
located, a payment in lieu of taxes which shall equal the taxes
on real and personal property, including water and sewer
assessments, which such lessee would have been required to pay
had it been the owner of such property during the period for
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which such payment is made.
Section 2807-D. Agency reporting obligations.
The agency shall make and submit an annual report to the
Governor and the General Assembly for the preceding fiscal year
not later than 120 days after the conclusion of the fiscal year.
The report shall contain a detailed statement of activities and
a complete operating and financial statement, all in accordance
with generally accepted accounting principles, covering the
operations of the agency during the year.
Section 2808-D. Electric distribution company obligations.
(a) Power supplies.--Electric distribution companies shall
accept specified supplies from the agency at cost and pass on
the supplies to default service customers at cost.
(b) Power supplies distribution.--Electric distribution
companies shall allocate power supplies from the agency to
default service customers on an equitable basis, in a manner to
be determined by the Pennsylvania Public Utility Commission. The
allocation must ensure that the costs of providing service to
each customer class are not subsidized by any other class.
(c) Revenues.--Electric distribution companies shall pass on
to retail customers a ratepayer fairness credit in a manner
specified in section 2805-D.
(d) Fixed-price contracts.--Electric distribution companies
shall offer fixed-price contracts to retail customers who agree
to waive their right to switch suppliers during the term of the
contract. This obligation is not limited by the amount of the
power supply provided to the electric distribution companies by
the agency.
(e) Economic development generation.--Electric distribution
companies shall accept specified generation supplies from the
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agency on behalf of eligible commercial and industrial customers
that are located within the electric distribution company's
territory and shall pass on the generation supplies to such
customers based on the rates, terms and conditions negotiated by
the agency with the individual eligible commercial or industrial
customer. Such contracts may not be subsidized by any other
customer or customer class.
(f) Coordination with agency.--Electric distribution
companies and their personnel shall cooperate and coordinate
with the agency, including providing access to any information
reasonably necessary for the agency to acquire generation
supplies in a least cost manner.
Section 2809-D. Revenue.
(a) Fund.--The Energy Procurement and Development Fund is
established as a separate fund in the State Treasury. All
sources of revenue provided for under this section shall be
deposited into the fund, which shall be maintained by the State
Treasurer.
(b) Revenue sources.--The money in the fund shall be used to
provide the ratepayer fairness credits under section 2805-D to
Pennsylvania electric consumers to reduce generation rates and
to fund the establishment and ongoing activities of the agency
and the Commonwealth Energy Advocate, as determined by the
board.
(c) Generation rebate.--An annual generation rebate is
established to be collected on a per-megawatt-basis from the
owners of all the Pennsylvania generating units or portions of
those units that were subject to regulation as a public utility
function prior to 66 Pa.C.S. Ch. 28 (relating to restructuring
of electric utility industry) taking effect.
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(d) Imposition.--The amount of the rebate shall be based on
application of the generation rebate rate established under
subsection (f) to the nameplate rating of units or portions of
units that were subject to regulation as a public utility
function regardless of current ownership.
(e) Applicability.--
(1) The rebate shall apply to generating units or
portions of generating units with nameplate ratings in excess
of 150 megawatts.
(2) The rebate shall not apply, during the term of the
contract, to any portion of the nameplate capacity of a
generating unit that is committed by a contract of five years
or longer to sell power to the agency at rates that are based
on the generating unit's cost of service.
(3) The rebate shall not apply to any generating units
or portions of generating units owned by rural electric
cooperative corporations under 15 Pa.C.S. Pt. II Subpt. D
Art. B (relating to domestic cooperative corporation
ancillaries) by the Commonwealth or by any political
subdivision of the Commonwealth. For purposes of this
exemption, the ownership of stock in an entity that owns a
generating unit shall not constitute ownership of the
generating unit or a portion thereof.
(f) Rates.--
(1) On or before September 30 of each year, the agency
shall establish the generation rebate rate to be collected
from the owners of subject generating units or portions
thereof for the following calendar year, which shall not
exceed the maximum annual rebate rate set forth in this
subsection. The agency may establish different generation
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rebate rates for different classifications of generating
units, based on the type of fuel used to generate
electricity.
(2) For calendar years 2010 and 2011, the maximum
generation rebate rate shall be $46,355 per megawatt.
Starting in 2012, the maximum annual rebate rate shall
thereafter be adjusted annually. On or before September 30,
2011, and by September 30 of each year thereafter, the agency
shall calculate the maximum annual rebate rate for the
subsequent calendar year by multiplying the initial annual
rebate rate of $46,355 per megawatt by a factor equal to the
greater of:
(i) the ratio of the cost of new entry for
generating facilities as calculated by the PJM
Interconnection LLC, or a successor entity, for the 12-
month period from June 1 of the then current year through
May 31 of the following year, to the cost of new entry
for generating facilities as calculated by the PJM
Interconnection LLC, or a successor entity, for the 12-
month period from June 1, 2009, through May 31, 2010; or
(ii) the ratio of the all hours average price of
electricity at the PJM Interconnection LLC Western Hub,
or a successor entity performing an equivalent function
for the purpose of calculating the all hours average
price of electricity, for the preceding calendar year, to
the all hours average price of electricity at the PJM
Interconnection LLC Western Hub, or a successor entity
performing an equivalent function for the purpose of
calculating the all hours average price of electricity
for 2009. For purposes of determining the cost of new
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entry under this adjustment mechanism, the agency shall
use the load weighted average of the cost of new entry
for the various regions in this Commonwealth. If either
of the indexes under subparagraph (i) or this
subparagraph should cease to exist, then the remaining
index shall thereafter be used to determine the maximum
annual generation rebate rate. In the event both indexes
should cease to exist, the maximum annual rebate rate
shall thereafter be the highest maximum rate in effect
for the last year for which either of the indexes was
available for purposes of calculating the maximum rebate
rate.
(g) Reports and payment.--The annual generation rebate shall
be reported and paid to the agency by the owners of subject
generating units or portions thereof no later than 120 days
after the beginning of the calendar year, pursuant to forms and
procedures to be established by the agency.
(h) Bond sales.--Proceeds from the sale of revenue bonds of
the agency authorized under section 2806-D(a)(4) shall be
deposited into the fund.
(i) Appropriations.--
(1) For the first two years of the agency's operations,
the General Assembly may appropriate money from the General
Fund for the operation of the agency not to exceed $2,500,000
for each year. These appropriated funds shall constitute an
advance that the agency shall repay without interest to the
Commonwealth within four years from the date it received the
appropriation.
(2) In addition to paragraph (1), where necessary to
cover the short-term operating costs of the agency, the
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General Assembly may appropriate from the General Fund from
time to time advance funds, not to exceed a total of
$1,000,000 per year to the agency as a short-term loan
without interest. The agency must repay the funds advanced
within two years of the date of receipt of the funds.
(j) Other funds or grants awarded.--Federal funds or
Commonwealth grants, if any, awarded to the agency shall be
deposited into the fund.
Section 2810-D. Eligible commercial and industrial customers.
(a) Criteria.--To be eligible to be served by the agency, a
commercial or industrial customer must:
(1) Enter into a contract taking all its power needs for
the account from the agency.
(2) Meet two or more of the following criteria:
(i) Be a manufacturer.
(ii) Be a large consumer of power in this
Commonwealth.
(iii) Be a user whose electricity bill is a high
percentage of its conversion cost, manufacturing cost
less raw materials cost.
(iv) Use power at a high load factor on an annual
basis.
(v) Help to create or retain a substantial number of
jobs in this Commonwealth.
(vi) Help to maintain the profitability of a
Commonwealth business at risk.
(vii) Create new capital investment in this
Commonwealth.
(viii) Have demonstrated a long-term commitment to
this Commonwealth, as evidenced by the longevity of
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operations.
(ix) Help other businesses in this Commonwealth to
remain competitive by lowering their input costs.
(x) Help to retain a business at risk of moving to a
location outside this Commonwealth.
(b) Agency discretion.--The agency shall have discretion to
allow eligibility based on criteria that are not specified in
subsection (a), provided that the grant of eligibility furthers
similar economic development goals.
Section 2811-D. Dissolution.
The agency may be dissolved by law, provided that the agency
has no bonds or other debts or obligations outstanding or that
provision has been made for the payment or retirement of all
such bonds, debts and obligations. Upon the dissolution of the
agency, all property, funds and assets of the agency shall be
vested in the Commonwealth.
Section 3. This act shall take effect in 60 days.
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