Bill Text: IL HB2875 | 2023-2024 | 103rd General Assembly | Introduced

NOTE: There are more recent revisions of this legislation. Read Latest Draft

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Bill Title: Reinserts the provisions of the introduced bill with the following changes: Makes changes to legislative findings. Provides that the Illinois Commerce Commission shall initiate a proceeding within 6 months (rather than 3 months) after the effective date of the amendatory Act to support the development of pilot thermal energy networks. Provides that within 12 months (rather than 3 months) after the effective date of the amendatory Act, any gas public utility, electric public utility, or combination public utility serving over 100,000 customers shall file with the Commission a petition seeking Commission approval of at least one and no more than 3 proposed pilot thermal energy network projects. Provides that a gas public utility, electric public utility, or combination public utility required to develop any pilot thermal energy network project shall be permitted to recover all reasonable and prudently incurred costs associated with the development, construction, and operation of one or more pilot thermal energy network projects through general rates. Removes provisions amending the Illinois Power Agency Act. Makes other changes. Effective immediately.

Spectrum: Partisan Bill (Democrat 10-0)

Status: (Engrossed) 2023-05-26 - Rule 3-9(a) / Re-referred to Assignments [HB2875 Detail]

Download: Illinois-2023-HB2875-Introduced.html

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103RD GENERAL ASSEMBLY State of Illinois 2023 and 2024 HB2875 Introduced , by Rep. Ann M. Williams SYNOPSIS AS INTRODUCED:
20 ILCS 3855/1-83 new
220 ILCS 5/3-101 from Ch. 111 2/3, par. 3-101
220 ILCS 5/3-105 from Ch. 111 2/3, par. 3-105
220 ILCS 5/3-127 new
220 ILCS 5/3-128 new
220 ILCS 5/8-513 new
Provides that the amendatory Act may be referred to as the Thermal Energy Network and Jobs Acts. Sets forth a statement of legislative findings and intent. Amends the Public Utilities Act. Defines "thermal energy" and "thermal energy network". Provides that the Illinois Commerce Commission shall initiate a proceeding within 3 months after the effective date of the amendatory Act to support the development of thermal energy networks. Specifies the matters the Commission shall consider in such proceeding. Provides that the Commission shall adopt rules within 2 years after the effective date of the amendatory Act to do specified tasks. Provides for procedures for submittal of proposed pilot thermal energy network projects with the Commission. Provides that each gas, electric, or combination gas and utility corporation shall report to the Commission, on a quarterly basis and until completion of the pilot thermal energy network project, the status of each project. Provides that any thermal energy network created shall demonstrate that the gas, electric, or combination gas and electric corporation has entered into a labor peace agreement with a bona fide labor organization of jurisdiction that is actively engaged in representing gas and electric corporation employees. Makes corresponding changes to the Act and the Illinois Power Agency Act. Effective immediately.
LRB103 26364 AMQ 52726 b
A BILL FOR
HB2875 LRB103 26364 AMQ 52726 b
AN ACT concerning utilities.
Be it enacted by the People of the State of Illinois,
represented in the General Assembly:
Section 1. Short title. This Act may be referred to as the
Thermal Energy Network and Jobs Act.
Section 5. Legislative findings and intent.
(a) The General Assembly finds and declares that:
(1) This State has a strong interest in ensuring that
building emissions are kept at a minimum. Buildings are
one of this State's largest sources of greenhouse gases
and other climate emissions due to the combustion of
fossil fuels for heating, domestic hot water, cooking, and
other end uses.
(2) The decarbonization of buildings must be pursued
in a manner that is affordable, accessible, preserves and
creates living-wage jobs, and retains the knowledge and
experience of the existing utility union workforce.
(3) Thermal energy networks have the potential to
decarbonize buildings at the community and utility scale.
(4) Thermal energy networks consist of pipe loops
between multiple buildings and energy sources carrying
water at ambient temperature. Building owners can connect
to the ambient temperature loops with water heating and

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cooling and hot water services.
(5) Many utilities in this State have been seeking to
develop thermal energy networks, but legal and regulatory
barriers and the current, and outdated, Public Utilities
Act framework have prevented them from moving these
proposals forward.
(6) This State has a strong interest in ensuring an
adequate supply of reliable electrical power and,
therefore, needs to promote the development of alternative
power sources and take steps to assure reliable
deliverability. Thermal energy networks are highly
efficient because they utilize and exchange thermal energy
from many underground sources and buildings, including
recycled thermal energy, which minimizes impact on the
electricity grid.
(7) Access to thermal energy networks has the
potential to reduce the up-front and operating costs of
building electrification for customers.
(8) A utility's access to capital, the utility's
experience with networked infrastructure in public
rights-of-way, and the requirement that the utility serve
all customers positions the utility well to develop and
scale thermal energy networks that are accessible to all
customers and to coordinate the development of thermal
energy networks with any downsizing of the utility gas
system.

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(9) This State also has a proprietary interest in the
efficient and reliable delivery of energy and the energy
infrastructure of the State, which interest is
acknowledged throughout the Public Utilities Act. Utility
corporations and other power suppliers share these
interests and, moreover, have a duty to protect
proprietary interests in the projects they fund. Such
investments of ratepayer resources can be protected by
establishing effective contractor qualification and
performance standards, including requirements for
prevailing wage rates, bona fide apprenticeship criteria,
and project labor agreements.
(10) The construction industry is highly skilled and
labor intensive, and the installation of modern thermal
energy networks involves particularly complex work.
Therefore, effective qualification standards for craft
labor personnel employed on these projects are critically
needed to promote successful project delivery.
(11) Finally, these findings are especially vital now
because the construction industry is experiencing
widespread skill shortages across the country, which are
crippling existing capital projects and threatening
projects planned for the future. The construction of
thermal energy networks will utilize many of the same
skills that the current utility and building trades
workforces already possess.

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(b) It is the intent of the General Assembly that passage
of this Act is for the following purposes:
(1) to remove the legal barriers to utility
development of thermal energy networks and require the
Illinois Commerce Commission to authorize and direct
utilities to immediately commence piloting thermal energy
networks in each and every utility territory;
(2) to direct and authorize the Illinois Commerce
Commission to develop a regulatory structure for utility
thermal energy networks that scales affordable and
accessible building electrification, protects customers,
and balances the role of incumbent monopoly utilities with
other market and public actors;
(3) to promote the successful planning and delivery of
thermal energy networks and protect critical investments
in such projects by requiring the use of appropriate
quality craft labor policies that ensure the development
of and access to an adequate supply of well trained,
highly skilled craft persons needed to support timely,
reliable, high-quality projects;
(4) to promote strong economic development and good
jobs for local residents in the expanding decarbonized
sector by requiring application of progressive State labor
and employment policies that ensure public utility
investments and related State subsidies create
unparalleled skill training and employment opportunities

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for residents in project areas through the use of local
prevailing wage standards and successful, bona fide
apprenticeship programs or project labor agreements that
incorporate prevailing wage and training standards and
provide additional benefits for project owners and
workers; and
(5) to promote the use of preapprenticeship programs
that will fortify and expand existing apprenticeship
programs through systematic outreach efforts to recruit
and assist persons from underrepresented and low income
communities by providing such persons with remedial
education, social services, and unique opportunities for
direct access into high-quality apprenticeship programs
and gainful employment in the growing building
decarbonization workforce.
Section 10. The Illinois Power Agency Act is amended by
adding Section 1-83 as follows:
(20 ILCS 3855/1-83 new)
Sec. 1-83. Pilot thermal energy network projects. No later
than 3 months after the effective date of this amendatory Act
of the 103rd General Assembly, the Resource Development
Bureau, the Agency, and the Agency's service provider shall
submit for review to the Commission at least one and as many as
5 proposed pilot thermal energy network projects as described

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in Section 8-513 of the Public Utilities Act. No later than 6
months after the effective date of this amendatory Act of the
103rd General Assembly, and upon recommendation by the Agency,
the Commission shall determine whether it is in the public
interest to approve or modify such pilot thermal energy
network projects and shall direct the service provider to
implement such proposed or modified pilot thermal energy
network projects. The Commission shall adopt rules consistent
with the standards set forth in subsections (b) and (c) of
Section 8-513 of the Public Utilities Act.
Section 905. The Public Utilities Act is amended by
changing Sections 3-101 and 3-105 and by adding Sections
3-127, 3-128, and 8-513 as follows:
(220 ILCS 5/3-101) (from Ch. 111 2/3, par. 3-101)
Sec. 3-101. Definitions. Unless otherwise specified, the
terms set forth in Sections 3-102 through 3-128 3-126 are used
in this Act as therein defined.
(Source: P.A. 97-96, eff. 7-13-11; 97-239, eff. 8-2-11;
97-813, eff. 7-13-12.)
(220 ILCS 5/3-105) (from Ch. 111 2/3, par. 3-105)
Sec. 3-105. Public utility.
(a) "Public utility" means and includes, except where
otherwise expressly provided in this Section, every

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corporation, company, limited liability company, association,
joint stock company or association, firm, partnership or
individual, their lessees, trustees, or receivers appointed by
any court whatsoever that owns, controls, operates or manages,
within this State, directly or indirectly, for public use, any
plant, equipment or property used or to be used for or in
connection with, or owns or controls any franchise, license,
permit, or right to engage in:
(1) the production, storage, transmission, sale,
delivery, or furnishing of heat, cold, power, electricity,
water, or light, except when used solely for
communications purposes;
(2) the disposal of sewerage; or
(3) the conveyance of oil or gas by pipe line; or .
(4) a thermal energy network.
(b) "Public utility" does not include, however:
(1) public utilities that are owned and operated by
any political subdivision, public institution of higher
education or municipal corporation of this State, or
public utilities that are owned by such political
subdivision, public institution of higher education, or
municipal corporation and operated by any of its lessees
or operating agents;
(2) water companies which are purely mutual concerns,
having no rates or charges for services, but paying the
operating expenses by assessment upon the members of such

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a company and no other person;
(3) electric cooperatives as defined in Section 3-119;
(4) the following natural gas cooperatives:
(A) residential natural gas cooperatives that are
not-for-profit corporations established for the
purpose of administering and operating, on a
cooperative basis, the furnishing of natural gas to
residences for the benefit of their members who are
residential consumers of natural gas. For entities
qualifying as residential natural gas cooperatives and
recognized by the Illinois Commerce Commission as
such, the State shall guarantee legally binding
contracts entered into by residential natural gas
cooperatives for the express purpose of acquiring
natural gas supplies for their members. The Illinois
Commerce Commission shall establish rules and
regulations providing for such guarantees. The total
liability of the State in providing all such
guarantees shall not at any time exceed $1,000,000,
nor shall the State provide such a guarantee to a
residential natural gas cooperative for more than 3
consecutive years; and
(B) natural gas cooperatives that are
not-for-profit corporations operated for the purpose
of administering, on a cooperative basis, the
furnishing of natural gas for the benefit of their

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members and that, prior to 90 days after the effective
date of this amendatory Act of the 94th General
Assembly, either had acquired or had entered into an
asset purchase agreement to acquire all or
substantially all of the operating assets of a public
utility or natural gas cooperative with the intention
of operating those assets as a natural gas
cooperative;
(5) sewage disposal companies which provide sewage
disposal services on a mutual basis without establishing
rates or charges for services, but paying the operating
expenses by assessment upon the members of the company and
no others;
(6) (blank);
(7) cogeneration facilities, small power production
facilities, and other qualifying facilities, as defined in
the Public Utility Regulatory Policies Act and regulations
promulgated thereunder, except to the extent State
regulatory jurisdiction and action is required or
authorized by federal law, regulations, regulatory
decisions or the decisions of federal or State courts of
competent jurisdiction;
(8) the ownership or operation of a facility that
sells compressed natural gas at retail to the public for
use only as a motor vehicle fuel and the selling of
compressed natural gas at retail to the public for use

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only as a motor vehicle fuel;
(9) alternative retail electric suppliers as defined
in Article XVI; and
(10) the Illinois Power Agency.
(c) An entity that furnishes the service of charging
electric vehicles does not and shall not be deemed to sell
electricity and is not and shall not be deemed a public utility
notwithstanding the basis on which the service is provided or
billed. If, however, the entity is otherwise deemed a public
utility under this Act, or is otherwise subject to regulation
under this Act, then that entity is not exempt from and remains
subject to the otherwise applicable provisions of this Act.
The installation, maintenance, and repair of an electric
vehicle charging station shall comply with the requirements of
subsection (a) of Section 16-128 and Section 16-128A of this
Act.
For purposes of this subsection, the term "electric
vehicles" has the meaning ascribed to that term in Section 10
of the Electric Vehicle Act.
(Source: P.A. 97-1128, eff. 8-28-12.)
(220 ILCS 5/3-127 new)
Sec. 3-127. Thermal energy. "Thermal energy" means piped
noncombustible fluids used for transferring heat into and out
of buildings for the purpose of eliminating any resultant
onsite greenhouse gas emissions of all types of heating and

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cooling processes, including, but not limited to, comfort
heating and cooling, domestic hot water, and refrigeration.
(220 ILCS 5/3-128 new)
Sec. 3-128. Thermal energy network. "Thermal energy
network" means all real estate, fixtures, and personal
property operated, owned, used, or to be used for, in
connection with, or to facilitate a utility-scale distribution
infrastructure project that supplies thermal energy.
(220 ILCS 5/8-513 new)
Sec. 8-513. Thermal energy network development.
(a) The Illinois Commerce Commission shall initiate a
proceeding within 3 months of the effective date after this
amendatory Act of the 103rd General Assembly to support the
development of thermal energy networks. The matters the
Commission shall consider in such proceeding shall include,
but is not limited to, the appropriate ownership, market, and
rate structures for thermal energy networks and whether the
provision of thermal energy services by gas or electric
utilities is in the public interest.
(b) The Commission shall adopt rules within 2 years after
the effective date of this amendatory Act of the 103rd General
Assembly to:
(1) create fair market access rules for utility-owned
thermal energy networks to accept thermal energy that

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aligns with the Illinois Power Agency Act and that does
not increase greenhouse gas emissions or copollutants;
(2) exempt small-scale thermal energy networks not
owned by utilities from regulation by the Commission;
(3) promote the training and transition of utility
workers impacted by this amendatory Act of the 103rd
General Assembly; and
(4) encourage third-party participation and
competition where it will maximize benefits to customers.
(c) Within 3 months after the effective date of this
amendatory Act of the 103rd General Assembly, each of the
largest gas, electric, or combination gas and electric
corporations shall submit to the Commission for review and
approval at least one and as many as 5 proposed pilot thermal
energy network projects. In developing the pilot project
proposals, at least one pilot project in each utility
territory shall be proposed in a disadvantaged community, as
described in the Illinois Power Agency Act, and if a utility
proposes 4 or more pilot projects, at least 2 shall be proposed
in disadvantaged communities. Each utility shall coordinate
with other utility participants, the Illinois Power Agency,
and consultants with expertise on successful pilot projects to
ensure that the pilot projects are diverse and designed to
inform the Commission's decisions in the proceeding on the
various ownership, market, and rate structures for thermal
energy networks. The pilot project proposals shall include

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specific customer protection plans, shall be made publicly
available on the Commission's website, and shall be subject to
a public comment period of no less than 30 days. Within 6
months after the effective date of this amendatory Act of the
103rd General Assembly, the Commission shall determine whether
it is in the public interest to approve or modify such pilot
thermal energy network projects and shall issue an order
directing each gas, electric, or combination gas and electric
corporation to implement such proposed or modified pilot
thermal energy network projects. In considering whether pilot
thermal energy network projects are in the public interest,
the Commission shall consider whether the pilot project will
develop information useful for the Commission's adoption of
rules governing thermal energy networks, whether the pilot
project furthers the climate justice and emissions reduction,
whether the pilot project advances financial and technical
approaches to equitable and affordable building
electrification, and whether the pilot project creates
benefits to customers and society at large, including, but not
limited to, public health benefits in areas with
disproportionate environmental or public health burdens, job
retention and creation, reliability, and increased
affordability of renewable thermal energy options.
(d) Each gas, electric, or combination gas and utility
corporation shall report to the Commission, on a quarterly
basis and until completion of the pilot thermal energy network

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project, as determined by the Commission, the status of each
pilot thermal energy network project. The Commission shall
post and make publicly available such reports on its website.
The report shall include, but not be limited to:
(1) the stage of development of each pilot project;
(2) the barriers to development;
(3) the number of customers served;
(4) the costs of the pilot project;
(5) the number of jobs retained or created by the
pilot project; and
(6) any other such information the Commission deems to
be in the public interest.
(e) Any thermal energy network created under this Section
shall demonstrate that the gas, electric, or combination gas
and electric corporation has entered into a labor peace
agreement with a bona fide labor organization of jurisdiction
that is actively engaged in representing gas, electric, and
combination gas and electric corporation employees. The labor
peace agreement shall apply to the employees necessary for the
maintenance and operation of such thermal energy network. The
labor peace agreement shall be an ongoing material condition
of authorization to maintain and operate such thermal energy
networks. The employees eligible for these positions shall
first be selected from and offered to a pool of transitioning
utility workers who have lost, or are at risk of losing, their
employment with a utility downsizing its gas transmission and

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distribution system. Such list of potential employees shall be
provided by affected unions and provided to the Illinois
Department of Labor. The Illinois Department of Labor shall
update and provide such list to the gas, electric, or
combination gas and electric corporation 90 days prior to the
purchase, acquisition, or construction of any thermal energy
network created under this Section.
Section 999. Effective date. This Act takes effect upon
becoming law.