96TH GENERAL ASSEMBLY
State of Illinois
2009 and 2010
SB3686


 
Introduced 2/11/2010, by Sen. Don Harmon
 
SYNOPSIS AS INTRODUCED:















20 ILCS 3855/1-10





20 ILCS 3855/1-56






20 ILCS 3855/1-75











 Amends the Illinois Power Agency Act. In provisions concerning the procurement of renewable energy resources, provides that at least 75% of the renewable energy resources shall come from wind generation and, in specified amounts by specified dates, of the renewable energy resources that must be derived from photovoltaics, at least 20% must come from large-scale distributed solar and at least 10% must come from small-scale distributed solar (rather than starting June 1, 2015, at least 6% of the renewable energy resources used to meet these standards shall come from solar photovoltaics). Provides that through June 1, 2016 (rather than June 1, 2011), renewable energy resources shall be counted for the purpose of meeting the renewable energy standards only if they are generated from facilities located in the State, provided that cost-effective renewable energy resources are available from those facilities. Provides that after June 1, 2016 (rather than June 1, 2011), cost-effective renewable energy resources located in Illinois and in states that adjoin Illinois may be counted towards compliance with specified standards. Effective immediately.
















LRB096 20770 MJR 36521 b

















 


 


A BILL FOR









 











SB3686

LRB096 20770 MJR 36521 b






1
 AN ACT concerning State government.


2
 Be it enacted by the People of the State of Illinois,

3
represented in the General Assembly:



4
 Section 5. The Illinois Power Agency Act is amended by 
5
changing Sections 1-10, 1-56, and 1-75 as follows:



6
 (20 ILCS 3855/1-10)


7
 Sec. 1-10. Definitions. 
8
 "Agency" means the Illinois Power Agency.
9
 "Agency loan agreement" means any agreement pursuant to 
10
which the Illinois Finance Authority agrees to loan the 
11
proceeds of revenue bonds issued with respect to a project to 
12
the Agency upon terms providing for loan repayment installments 
13
at least sufficient to pay when due all principal of, interest 
14
and premium, if any, on those revenue bonds, and providing for 
15
maintenance, insurance, and other matters in respect of the 
16
project.
17
 "Authority" means the Illinois Finance Authority.
18
 "Clean coal facility" means an electric generating 
19
facility that uses primarily coal as a feedstock and that 
20
captures and sequesters carbon emissions at the following 
21
levels: at least 50% of the total carbon emissions that the 
22
facility would otherwise emit if, at the time construction 
23
commences, the facility is scheduled to commence operation 
 


 






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before 2016, at least 70% of the total carbon emissions that 
2
the facility would otherwise emit if, at the time construction 
3
commences, the facility is scheduled to commence operation 
4
during 2016 or 2017, and at least 90% of the total carbon 
5
emissions that the facility would otherwise emit if, at the 
6
time construction commences, the facility is scheduled to 
7
commence operation after 2017. The power block of the clean 
8
coal facility shall not exceed allowable emission rates for 
9
sulfur dioxide, nitrogen oxides, carbon monoxide, particulates 
10
and mercury for a natural gas-fired combined-cycle facility the 
11
same size as and in the same location as the clean coal 
12
facility at the time the clean coal facility obtains an 
13
approved air permit. All coal used by a clean coal facility 
14
shall have high volatile bituminous rank and greater than 1.7 
15
pounds of sulfur per million btu content, unless the clean coal 
16
facility does not use gasification technology and was operating 
17
as a conventional coal-fired electric generating facility on 
18
June 1, 2009 (the effective date of Public Act 95-1027). 
19
 "Clean coal SNG facility" means a facility that uses a 
20
gasification process to produce substitute natural gas, that 
21
sequesters at least 90% of the total carbon emissions that the 
22
facility would otherwise emit and that uses petroleum coke or 
23
coal as a feedstock, with all such coal having a high 
24
bituminous rank and greater than 1.7 pounds of sulfur per 
25
million btu content. 
26
 "Commission" means the Illinois Commerce Commission.
 


 






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1
 "Costs incurred in connection with the development and 
2
construction of a facility" means:
3
  (1) the cost of acquisition of all real property and 
4
 improvements in connection therewith and equipment and 
5
 other property, rights, and easements acquired that are 
6
 deemed necessary for the operation and maintenance of the 
7
 facility;
8
  (2) financing costs with respect to bonds, notes, and 
9
 other evidences of indebtedness of the Agency;
10
  (3) all origination, commitment, utilization, 
11
 facility, placement, underwriting, syndication, credit 
12
 enhancement, and rating agency fees;
13
  (4) engineering, design, procurement, consulting, 
14
 legal, accounting, title insurance, survey, appraisal, 
15
 escrow, trustee, collateral agency, interest rate hedging, 
16
 interest rate swap, capitalized interest and other 
17
 financing costs, and other expenses for professional 
18
 services; and
19
  (5) the costs of plans, specifications, site study and 
20
 investigation, installation, surveys, other Agency costs 
21
 and estimates of costs, and other expenses necessary or 
22
 incidental to determining the feasibility of any project, 
23
 together with such other expenses as may be necessary or 
24
 incidental to the financing, insuring, acquisition, and 
25
 construction of a specific project and placing that project 
26
 in operation.
 


 






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1
 "Department" means the Department of Commerce and Economic 
2
Opportunity.
3
 "Director" means the Director of the Illinois Power Agency.
4
 "Demand-response" means measures that decrease peak 
5
electricity demand or shift demand from peak to off-peak 
6
periods.
7
 "Energy efficiency" means measures that reduce the amount 
8
of electricity or natural gas required to achieve a given end 
9
use.
10
 "Electric utility" has the same definition as found in 
11
Section 16-102 of the Public Utilities Act.
12
 "Facility" means an electric generating unit or a 
13
co-generating unit that produces electricity along with 
14
related equipment necessary to connect the facility to an 
15
electric transmission or distribution system.
16
 "Governmental aggregator" means one or more units of local 
17
government that individually or collectively procure 
18
electricity to serve residential retail electrical loads 
19
located within its or their jurisdiction.
20
 "Local government" means a unit of local government as 
21
defined in Article VII of Section 1 of the Illinois 
22
Constitution.
23
 "Large-scale distributed solar" means photovoltaic systems 
24
that (i) have a generation capacity greater than 10 kilowatts 
25
and (ii) are located on the customer's side of customer's 
26
electric meter. 
 


 






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 "Municipality" means a city, village, or incorporated 
2
town.
3
 "Person" means any natural person, firm, partnership, 
4
corporation, either domestic or foreign, company, association, 
5
limited liability company, joint stock company, or association 
6
and includes any trustee, receiver, assignee, or personal 
7
representative thereof.
8
 "Project" means the planning, bidding, and construction of 
9
a facility.
10
 "Public utility" has the same definition as found in 
11
Section 3-105 of the Public Utilities Act.
12
 "Real property" means any interest in land together with 
13
all structures, fixtures, and improvements thereon, including 
14
lands under water and riparian rights, any easements, 
15
covenants, licenses, leases, rights-of-way, uses, and other 
16
interests, together with any liens, judgments, mortgages, or 
17
other claims or security interests related to real property.
18
 "Renewable energy credit" means a tradable credit that 
19
represents the environmental attributes of a certain amount of 
20
energy produced from a renewable energy resource.
21
 "Renewable energy resources" includes energy and its 
22
associated renewable energy credit or renewable energy credits 
23
from wind, solar thermal energy, photovoltaic cells and panels, 
24
biodiesel, crops and untreated and unadulterated organic waste 
25
biomass, tree waste, hydropower that does not involve new 
26
construction or significant expansion of hydropower dams, and 
 


 






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other alternative sources of environmentally preferable 
2
energy. For purposes of this Act, landfill gas produced in the 
3
State is considered a renewable energy resource. "Renewable 
4
energy resources" does not include the incineration or burning 
5
of tires, garbage, general household, institutional, and 
6
commercial waste, industrial lunchroom or office waste, 
7
landscape waste other than tree waste, railroad crossties, 
8
utility poles, or construction or demolition debris, other than 
9
untreated and unadulterated waste wood.
10
 "Small-scale distributed solar" means photovoltaic systems 
11
that (i) have a generation capacity of 10 kilowatts or less and 
12
(ii) are located on the customer's side of customer's electric 
13
meter. 
14
 "Revenue bond" means any bond, note, or other evidence of 
15
indebtedness issued by the Authority, the principal and 
16
interest of which is payable solely from revenues or income 
17
derived from any project or activity of the Agency.
18
 "Sequester" means permanent storage of carbon dioxide by 
19
injecting it into a saline aquifer, a depleted gas reservoir, 
20
or an oil reservoir, directly or through an enhanced oil 
21
recovery process that may involve intermediate storage in a 
22
salt dome. 
23
 "Servicing agreement" means (i) in the case of an electric 
24
utility, an agreement between the owner of a clean coal 
25
facility and such electric utility, which agreement shall have 
26
terms and conditions meeting the requirements of paragraph (3) 
 


 






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of subsection (d) of Section 1-75, and (ii) in the case of an 
2
alternative retail electric supplier, an agreement between the 
3
owner of a clean coal facility and such alternative retail 
4
electric supplier, which agreement shall have terms and 
5
conditions meeting the requirements of Section 16-115(d)(5) of 
6
the Public Utilities Act. 
7
 "Substitute natural gas" or "SNG" means a gas manufactured 
8
by gasification of hydrocarbon feedstock, which is 
9
substantially interchangeable in use and distribution with 
10
conventional natural gas. 
11
 "Total resource cost test" or "TRC test" means a standard 
12
that is met if, for an investment in energy efficiency or 
13
demand-response measures, the benefit-cost ratio is greater 
14
than one. The benefit-cost ratio is the ratio of the net 
15
present value of the total benefits of the program to the net 
16
present value of the total costs as calculated over the 
17
lifetime of the measures. A total resource cost test compares 
18
the sum of avoided electric utility costs, representing the 
19
benefits that accrue to the system and the participant in the 
20
delivery of those efficiency measures, as well as other 
21
quantifiable societal benefits, including avoided natural gas 
22
utility costs, to the sum of all incremental costs of end-use 
23
measures that are implemented due to the program (including 
24
both utility and participant contributions), plus costs to 
25
administer, deliver, and evaluate each demand-side program, to 
26
quantify the net savings obtained by substituting the 
 


 






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demand-side program for supply resources. In calculating 
2
avoided costs of power and energy that an electric utility 
3
would otherwise have had to acquire, reasonable estimates shall 
4
be included of financial costs likely to be imposed by future 
5
regulations and legislation on emissions of greenhouse gases.

6
(Source: P.A. 95-481, eff. 8-28-07; 95-913, eff. 1-1-09; 
7
95-1027, eff. 6-1-09; 96-33, eff. 7-10-09; 96-159, eff. 
8
8-10-09; 96-784, eff. 8-28-09; revised 9-15-09.)


9
 (20 ILCS 3855/1-56)
10
 Sec. 1-56. Illinois Power Agency Renewable Energy 
11
Resources Fund.
12
 (a) The Illinois Power Agency Renewable Energy Resources 
13
Fund is created as a special fund in the State treasury.
14
 (b) The Illinois Power Agency Renewable Energy Resources 
15
Fund shall be administered by the Agency to procure renewable 
16
energy resources. Prior to June 1, 2016 2011, resources 
17
procured pursuant to this Section shall be procured from 
18
facilities located in Illinois, provided the resources are 
19
available from those facilities. If resources are not available 
20
in Illinois, then they shall be procured in states that adjoin 
21
Illinois. If resources are not available in Illinois or in 
22
states that adjoin Illinois, then they may be purchased 
23
elsewhere. Beginning June 1, 2016 2011, resources procured 
24
pursuant to this Section shall be procured from facilities 
25
located in Illinois or states that adjoin Illinois. If 
 


 






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resources are not available in Illinois or in states that 
2
adjoin Illinois, then they may be procured elsewhere. To the 
3
extent available, at least 75% of these renewable energy 
4
resources shall come from wind generation. and, Of the 
5
renewable energy resources that must be derived from 
6
photovoltaics under this subsection (b), (0.5% by June 1, 2012, 
7
1.5% by June 1, 2013, 3% by June 1, 2014, and 6% by June 15 and 
8
each year thereafter) at least 20% must come from large-scale 
9
distributed solar and at least 10% must come from small-scale 
10
distributed solar starting June 1, 2015, at least 6% of the 
11
renewable energy resources used to meet these standards shall 
12
come from solar photovoltaics.
13
 (c) The Agency shall procure renewable energy resources at 
14
least once each year in conjunction with a procurement event 
15
for electric utilities required to comply with Section 1-75 of 
16
the Act and shall, whenever possible, enter into long-term 
17
contracts.
18
 (d) The price paid to procure renewable energy credits 
19
using monies from the Illinois Power Agency Renewable Energy 
20
Resources Fund shall not exceed the winning bid prices paid for 
21
like resources procured for electric utilities required to 
22
comply with Section 1-75 of this Act.
23
 (e) All renewable energy credits procured using monies from 
24
the Illinois Power Agency Renewable Energy Resources Fund shall 
25
be permanently retired.
26
 (f) The procurement process described in this Section is 
 


 






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exempt from the requirements of the Illinois Procurement Code, 
2
pursuant to Section 20-10 of that Code.
3
 (g) All disbursements from the Illinois Power Agency 
4
Renewable Energy Resources Fund shall be made only upon 
5
warrants of the Comptroller drawn upon the Treasurer as 
6
custodian of the Fund upon vouchers signed by the Director or 
7
by the person or persons designated by the Director for that 
8
purpose. The Comptroller is authorized to draw the warrant upon 
9
vouchers so signed. The Treasurer shall accept all warrants so 
10
signed and shall be released from liability for all payments 
11
made on those warrants.
12
 (h) The Illinois Power Agency Renewable Energy Resources 
13
Fund shall not be subject to sweeps, administrative charges, or 
14
chargebacks, including, but not limited to, those authorized 
15
under Section 8h of the State Finance Act, that would in any 
16
way result in the transfer of any funds from this Fund to any 
17
other fund of this State or in having any such funds utilized 
18
for any purpose other than the express purposes set forth in 
19
this Section.

20
(Source: P.A. 96-159, eff. 8-10-09.)

21
 (20 ILCS 3855/1-75)
22
 Sec. 1-75. Planning and Procurement Bureau. The Planning 
23
and Procurement Bureau has the following duties and 
24
responsibilities:
25
  (a) The Planning and Procurement Bureau shall each 
 


 






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 year, beginning in 2008, develop procurement plans and 
2
 conduct competitive procurement processes in accordance 
3
 with the requirements of Section 16-111.5 of the Public 
4
 Utilities Act for the eligible retail customers of electric 
5
 utilities that on December 31, 2005 provided electric 
6
 service to at least 100,000 customers in Illinois. For the 
7
 purposes of this Section, the term "eligible retail 
8
 customers" has the same definition as found in Section 
9
 16-111.5(a) of the Public Utilities Act.
10
   (1) The Agency shall each year, beginning in 2008, 
11
 as needed, issue a request for qualifications for 
12
 experts or expert consulting firms to develop the 
13
 procurement plans in accordance with Section 16-111.5 
14
 of the Public Utilities Act. In order to qualify an 
15
 expert or expert consulting firm must have:
16
    (A) direct previous experience assembling 
17
 large-scale power supply plans or portfolios for 
18
 end-use customers;
19
    (B) an advanced degree in economics, 
20
 mathematics, engineering, risk management, or a 
21
 related area of study;
22
    (C) 10 years of experience in the electricity 
23
 sector, including managing supply risk;
24
    (D) expertise in wholesale electricity market 
25
 rules, including those established by the Federal 
26
 Energy Regulatory Commission and regional 
 


 






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 transmission organizations;
2
    (E) expertise in credit protocols and 
3
 familiarity with contract protocols;
4
    (F) adequate resources to perform and fulfill 
5
 the required functions and responsibilities; and
6
    (G) the absence of a conflict of interest and 
7
 inappropriate bias for or against potential 
8
 bidders or the affected electric utilities.
9
   (2) The Agency shall each year, as needed, issue a 
10
 request for qualifications for a procurement 
11
 administrator to conduct the competitive procurement 
12
 processes in accordance with Section 16-111.5 of the 
13
 Public Utilities Act. In order to qualify an expert or 
14
 expert consulting firm must have:
15
    (A) direct previous experience administering a 
16
 large-scale competitive procurement process;
17
    (B) an advanced degree in economics, 
18
 mathematics, engineering, or a related area of 
19
 study;
20
    (C) 10 years of experience in the electricity 
21
 sector, including risk management experience;
22
    (D) expertise in wholesale electricity market 
23
 rules, including those established by the Federal 
24
 Energy Regulatory Commission and regional 
25
 transmission organizations; 
26
    (E) expertise in credit and contract 
 


 






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 protocols;
2
    (F) adequate resources to perform and fulfill 
3
 the required functions and responsibilities; and
4
    (G) the absence of a conflict of interest and 
5
 inappropriate bias for or against potential 
6
 bidders or the affected electric utilities.
7
   (3) The Agency shall provide affected utilities 
8
 and other interested parties with the lists of 
9
 qualified experts or expert consulting firms 
10
 identified through the request for qualifications 
11
 processes that are under consideration to develop the 
12
 procurement plans and to serve as the procurement 
13
 administrator. The Agency shall also provide each 
14
 qualified expert's or expert consulting firm's 
15
 response to the request for qualifications. All 
16
 information provided under this subparagraph shall 
17
 also be provided to the Commission. The Agency may 
18
 provide by rule for fees associated with supplying the 
19
 information to utilities and other interested parties. 
20
 These parties shall, within 5 business days, notify the 
21
 Agency in writing if they object to any experts or 
22
 expert consulting firms on the lists. Objections shall 
23
 be based on:
24
    (A) failure to satisfy qualification criteria;
25
    (B) identification of a conflict of interest; 
26
 or
 


 






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    (C) evidence of inappropriate bias for or 
2
 against potential bidders or the affected 
3
 utilities.
4
   The Agency shall remove experts or expert 
5
 consulting firms from the lists within 10 days if there 
6
 is a reasonable basis for an objection and provide the 
7
 updated lists to the affected utilities and other 
8
 interested parties. If the Agency fails to remove an 
9
 expert or expert consulting firm from a list, an 
10
 objecting party may seek review by the Commission 
11
 within 5 days thereafter by filing a petition, and the 
12
 Commission shall render a ruling on the petition within 
13
 10 days. There is no right of appeal of the 
14
 Commission's ruling.
15
   (4) The Agency shall issue requests for proposals 
16
 to the qualified experts or expert consulting firms to 
17
 develop a procurement plan for the affected utilities 
18
 and to serve as procurement administrator.
19
   (5) The Agency shall select an expert or expert 
20
 consulting firm to develop procurement plans based on 
21
 the proposals submitted and shall award one-year 
22
 contracts to those selected with an option for the 
23
 Agency for a one-year renewal.
24
   (6) The Agency shall select an expert or expert 
25
 consulting firm, with approval of the Commission, to 
26
 serve as procurement administrator based on the 
 


 






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 proposals submitted. If the Commission rejects, within 
2
 5 days, the Agency's selection, the Agency shall submit 
3
 another recommendation within 3 days based on the 
4
 proposals submitted. The Agency shall award a one-year 
5
 contract to the expert or expert consulting firm so 
6
 selected with Commission approval with an option for 
7
 the Agency for a one-year renewal.
8
  (b) The experts or expert consulting firms retained by 
9
 the Agency shall, as appropriate, prepare procurement 
10
 plans, and conduct a competitive procurement process as 
11
 prescribed in Section 16-111.5 of the Public Utilities Act, 
12
 to ensure adequate, reliable, affordable, efficient, and 
13
 environmentally sustainable electric service at the lowest 
14
 total cost over time, taking into account any benefits of 
15
 price stability, for eligible retail customers of electric 
16
 utilities that on December 31, 2005 provided electric 
17
 service to at least 100,000 customers in the State of 
18
 Illinois.
19
  (c) Renewable portfolio standard.
20
   (1) The procurement plans shall include 
21
 cost-effective renewable energy resources. A minimum 
22
 percentage of each utility's total supply to serve the 
23
 load of eligible retail customers, as defined in 
24
 Section 16-111.5(a) of the Public Utilities Act, 
25
 procured for each of the following years shall be 
26
 generated from cost-effective renewable energy 
 


 






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 resources: at least 2% by June 1, 2008; at least 4% by 
2
 June 1, 2009; at least 5% by June 1, 2010; at least 6% 
3
 by June 1, 2011; at least 7% by June 1, 2012; at least 
4
 8% by June 1, 2013; at least 9% by June 1, 2014; at 
5
 least 10% by June 1, 2015; and increasing by at least 
6
 1.5% each year thereafter to at least 25% by June 1, 
7
 2025. To the extent that it is available, at least 75% 
8
 of the renewable energy resources used to meet these 
9
 standards shall come from wind generation and, 
10
 beginning on June 1, 2011 2015, at least the following 
11
 percentages 6% of the renewable energy resources used 
12
 to meet these standards shall come from photovoltaics: 
13
 0.5% by June 1, 2012, 1.5% by June 1, 2013, 3% by June 
14
 1, 2014, and 6% by June 1, 2015 and each year 
15
 thereafter. Of the renewable energy resources that 
16
 must be derived from photovoltaics under this 
17
 subsection (c), at least 20% must come from large-scale 
18
 distributed solar and at least 10% must come from 
19
 small-scale distributed solar. For purposes of this 
20
 subsection (c), "cost-effective" means that the costs 
21
 of procuring renewable energy resources do not cause 
22
 the limit stated in paragraph (2) of this subsection 
23
 (c) to be exceeded and do not exceed benchmarks based 
24
 on market prices for renewable energy resources in the 
25
 region, which shall be developed by the procurement 
26
 administrator, in consultation with the Commission 
 


 






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 staff, Agency staff, and the procurement monitor and 
2
 shall be subject to Commission review and approval. 
3
   (2) For purposes of this subsection (c), the 
4
 required procurement of cost-effective renewable 
5
 energy resources for a particular year shall be 
6
 measured as a percentage of the actual amount of 
7
 electricity (megawatt-hours) supplied by the electric 
8
 utility to eligible retail customers in the planning 
9
 year ending immediately prior to the procurement. For 
10
 purposes of this subsection (c), the amount paid per 
11
 kilowatthour means the total amount paid for electric 
12
 service expressed on a per kilowatthour basis. For 
13
 purposes of this subsection (c), the total amount paid 
14
 for electric service includes without limitation 
15
 amounts paid for supply, transmission, distribution, 
16
 surcharges, and add-on taxes.
17
   Notwithstanding the requirements of this 
18
 subsection (c), the total of renewable energy 
19
 resources procured pursuant to the procurement plan 
20
 for any single year shall be reduced by an amount 
21
 necessary to limit the annual estimated average net 
22
 increase due to the costs of these resources included 
23
 in the amounts paid by eligible retail customers in 
24
 connection with electric service to:
25
    (A) in 2008, no more than 0.5% of the amount 
26
 paid per kilowatthour by those customers during 
 


 






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 the year ending May 31, 2007;
2
    (B) in 2009, the greater of an additional 0.5% 
3
 of the amount paid per kilowatthour by those 
4
 customers during the year ending May 31, 2008 or 1% 
5
 of the amount paid per kilowatthour by those 
6
 customers during the year ending May 31, 2007;
7
    (C) in 2010, the greater of an additional 0.5% 
8
 of the amount paid per kilowatthour by those 
9
 customers during the year ending May 31, 2009 or 
10
 1.5% of the amount paid per kilowatthour by those 
11
 customers during the year ending May 31, 2007;
12
    (D) in 2011, the greater of an additional 0.5% 
13
 of the amount paid per kilowatthour by those 
14
 customers during the year ending May 31, 2010 or 2% 
15
 of the amount paid per kilowatthour by those 
16
 customers during the year ending May 31, 2007; and 
17
    (E) thereafter, the amount of renewable energy 
18
 resources procured pursuant to the procurement 
19
 plan for any single year shall be reduced by an 
20
 amount necessary to limit the estimated average 
21
 net increase due to the cost of these resources 
22
 included in the amounts paid by eligible retail 
23
 customers in connection with electric service to 
24
 no more than the greater of 2.015% of the amount 
25
 paid per kilowatthour by those customers during 
26
 the year ending May 31, 2007 or the incremental 
 


 






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 amount per kilowatthour paid for these resources 
2
 in 2011.
3
   No later than June 30, 2011, the Commission shall 
4
 review the limitation on the amount of renewable energy 
5
 resources procured pursuant to this subsection (c) and 
6
 report to the General Assembly its findings as to 
7
 whether that limitation unduly constrains the 
8
 procurement of cost-effective renewable energy 
9
 resources.
10
   (3) Through June 1, 2016 2011, renewable energy 
11
 resources shall be counted for the purpose of meeting 
12
 the renewable energy standards set forth in paragraph 
13
 (1) of this subsection (c) only if they are generated 
14
 from facilities located in the State, provided that 
15
 cost-effective renewable energy resources are 
16
 available from those facilities. If those 
17
 cost-effective resources are not available in 
18
 Illinois, they shall be procured in states that adjoin 
19
 Illinois and may be counted towards compliance. If 
20
 those cost-effective resources are not available in 
21
 Illinois or in states that adjoin Illinois, they shall 
22
 be purchased elsewhere and shall be counted towards 
23
 compliance. After June 1, 2016 2011, cost-effective 
24
 renewable energy resources located in Illinois and in 
25
 states that adjoin Illinois may be counted towards 
26
 compliance with the standards set forth in paragraph 
 


 






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1
 (1) of this subsection (c). If those cost-effective 
2
 resources are not available in Illinois or in states 
3
 that adjoin Illinois, they shall be purchased 
4
 elsewhere and shall be counted towards compliance.
5
   (4) The electric utility shall retire all 
6
 renewable energy credits used to comply with the 
7
 standard.
8
   (5) Beginning with the year commencing June 1, 
9
 2010, an electric utility subject to this subsection 
10
 (c) shall apply the lesser of the maximum alternative 
11
 compliance payment rate or the most recent estimated 
12
 alternative compliance payment rate for its service 
13
 territory for the corresponding compliance period, 
14
 established pursuant to subsection (d) of Section 
15
 16-115D of the Public Utilities Act to its retail 
16
 customers that take service pursuant to the electric 
17
 utility's hourly pricing tariff or tariffs. The 
18
 electric utility shall retain all amounts collected as 
19
 a result of the application of the alternative 
20
 compliance payment rate or rates to such customers, 
21
 and, beginning in 2011, the utility shall include in 
22
 the information provided under item (1) of subsection 
23
 (d) of Section 16-111.5 of the Public Utilities Act the 
24
 amounts collected under the alternative compliance 
25
 payment rate or rates for the prior year ending May 31. 
26
 Notwithstanding any limitation on the procurement of 
 


 






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1
 renewable energy resources imposed by item (2) of this 
2
 subsection (c), the Agency shall increase its spending 
3
 on the purchase of renewable energy resources to be 
4
 procured by the electric utility for the next plan year 
5
 by an amount equal to the amounts collected by the 
6
 utility under the alternative compliance payment rate 
7
 or rates in the prior year ending May 31. 
8
 (d) Clean coal portfolio standard.
9
  (1) The procurement plans shall include electricity 
10
 generated using clean coal. Each utility shall enter into 
11
 one or more sourcing agreements with the initial clean coal 
12
 facility, as provided in paragraph (3) of this subsection 
13
 (d), covering electricity generated by the initial clean 
14
 coal facility representing at least 5% of each utility's 
15
 total supply to serve the load of eligible retail customers 
16
 in 2015 and each year thereafter, as described in paragraph 
17
 (3) of this subsection (d), subject to the limits specified 
18
 in paragraph (2) of this subsection (d). It is the goal of 
19
 the State that by January 1, 2025, 25% of the electricity 
20
 used in the State shall be generated by cost-effective 
21
 clean coal facilities. For purposes of this subsection (d), 
22
 "cost-effective" means that the expenditures pursuant to 
23
 such sourcing agreements do not cause the limit stated in 
24
 paragraph (2) of this subsection (d) to be exceeded and do 
25
 not exceed cost-based benchmarks, which shall be developed 
26
 to assess all expenditures pursuant to such sourcing 
 


 






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 agreements covering electricity generated by clean coal 
2
 facilities, other than the initial clean coal facility, by 
3
 the procurement administrator, in consultation with the 
4
 Commission staff, Agency staff, and the procurement 
5
 monitor and shall be subject to Commission review and 
6
 approval.
7
   (A) A utility party to a sourcing agreement shall 
8
 immediately retire any emission credits that it 
9
 receives in connection with the electricity covered by 
10
 such agreement.
11
   (B) Utilities shall maintain adequate records 
12
 documenting the purchases under the sourcing agreement 
13
 to comply with this subsection (d) and shall file an 
14
 accounting with the load forecast that must be filed 
15
 with the Agency by July 15 of each year, in accordance 
16
 with subsection (d) of Section 16-111.5 of the Public 
17
 Utilities Act.
18
   (C) A utility shall be deemed to have complied with 
19
 the clean coal portfolio standard specified in this 
20
 subsection (d) if the utility enters into a sourcing 
21
 agreement as required by this subsection (d). 
22
  (2) For purposes of this subsection (d), the required 
23
 execution of sourcing agreements with the initial clean 
24
 coal facility for a particular year shall be measured as a 
25
 percentage of the actual amount of electricity 
26
 (megawatt-hours) supplied by the electric utility to 
 


 






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1
 eligible retail customers in the planning year ending 
2
 immediately prior to the agreement's execution. For 
3
 purposes of this subsection (d), the amount paid per 
4
 kilowatthour means the total amount paid for electric 
5
 service expressed on a per kilowatthour basis. For purposes 
6
 of this subsection (d), the total amount paid for electric 
7
 service includes without limitation amounts paid for 
8
 supply, transmission, distribution, surcharges and add-on 
9
 taxes.
10
  Notwithstanding the requirements of this subsection 
11
 (d), the total amount paid under sourcing agreements with 
12
 clean coal facilities pursuant to the procurement plan for 
13
 any given year shall be reduced by an amount necessary to 
14
 limit the annual estimated average net increase due to the 
15
 costs of these resources included in the amounts paid by 
16
 eligible retail customers in connection with electric 
17
 service to:
18
    (A) in 2010, no more than 0.5% of the amount 
19
 paid per kilowatthour by those customers during 
20
 the year ending May 31, 2009;
21
    (B) in 2011, the greater of an additional 0.5% 
22
 of the amount paid per kilowatthour by those 
23
 customers during the year ending May 31, 2010 or 1% 
24
 of the amount paid per kilowatthour by those 
25
 customers during the year ending May 31, 2009;
26
    (C) in 2012, the greater of an additional 0.5% 
 


 






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1
 of the amount paid per kilowatthour by those 
2
 customers during the year ending May 31, 2011 or 
3
 1.5% of the amount paid per kilowatthour by those 
4
 customers during the year ending May 31, 2009;
5
    (D) in 2013, the greater of an additional 0.5% 
6
 of the amount paid per kilowatthour by those 
7
 customers during the year ending May 31, 2012 or 2% 
8
 of the amount paid per kilowatthour by those 
9
 customers during the year ending May 31, 2009; and
10
    (E) thereafter, the total amount paid under 
11
 sourcing agreements with clean coal facilities 
12
 pursuant to the procurement plan for any single 
13
 year shall be reduced by an amount necessary to 
14
 limit the estimated average net increase due to the 
15
 cost of these resources included in the amounts 
16
 paid by eligible retail customers in connection 
17
 with electric service to no more than the greater 
18
 of (i) 2.015% of the amount paid per kilowatthour 
19
 by those customers during the year ending May 31, 
20
 2009 or (ii) the incremental amount per 
21
 kilowatthour paid for these resources in 2013. 
22
 These requirements may be altered only as provided 
23
 by statute.
No later than June 30, 2015, the 
24
 Commission shall review the limitation on the 
25
 total amount paid under sourcing agreements, if 
26
 any, with clean coal facilities pursuant to this 
 


 






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1
 subsection (d) and report to the General Assembly 
2
 its findings as to whether that limitation unduly 
3
 constrains the amount of electricity generated by 
4
 cost-effective clean coal facilities that is 
5
 covered by sourcing agreements.
6
  (3) Initial clean coal facility. In order to promote 
7
 development of clean coal facilities in Illinois, each 
8
 electric utility subject to this Section shall execute a 
9
 sourcing agreement to source electricity from a proposed 
10
 clean coal facility in Illinois (the "initial clean coal 
11
 facility") that will have a nameplate capacity of at least 
12
 500 MW when commercial operation commences, that has a 
13
 final Clean Air Act permit on the effective date of this 
14
 amendatory Act of the 95th General Assembly, and that will 
15
 meet the definition of clean coal facility in Section 1-10 
16
 of this Act when commercial operation commences. The 
17
 sourcing agreements with this initial clean coal facility 
18
 shall be subject to both approval of the initial clean coal 
19
 facility by the General Assembly and satisfaction of the 
20
 requirements of paragraph (4) of this subsection (d) and 
21
 shall be executed within 90 days after any such approval by 
22
 the General Assembly. The Agency and the Commission shall 
23
 have authority to inspect all books and records associated 
24
 with the initial clean coal facility during the term of 
25
 such a sourcing agreement. A utility's sourcing agreement 
26
 for electricity produced by the initial clean coal facility 
 


 






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1
 shall include:
2
   (A) a formula contractual price (the "contract 
3
 price") approved pursuant to paragraph (4) of this 
4
 subsection (d), which shall:
5
    (i) be determined using a cost of service 
6
 methodology employing either a level or deferred 
7
 capital recovery component, based on a capital 
8
 structure consisting of 45% equity and 55% debt, 
9
 and a return on equity as may be approved by the 
10
 Federal Energy Regulatory Commission, which in any 
11
 case may not exceed the lower of 11.5% or the rate 
12
 of return approved by the General Assembly 
13
 pursuant to paragraph (4) of this subsection (d); 
14
 and
15
    (ii) provide that all miscellaneous net 
16
 revenue, including but not limited to net revenue 
17
 from the sale of emission allowances, if any, 
18
 substitute natural gas, if any, grants or other 
19
 support provided by the State of Illinois or the 
20
 United States Government, firm transmission 
21
 rights, if any, by-products produced by the 
22
 facility, energy or capacity derived from the 
23
 facility and not covered by a sourcing agreement 
24
 pursuant to paragraph (3) of this subsection (d) or 
25
 item (5) of subsection (d) of Section 16-115 of the 
26
 Public Utilities Act, whether generated from the 
 


 






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1
 synthesis gas derived from coal, from SNG, or from 
2
 natural gas, shall be credited against the revenue 
3
 requirement for this initial clean coal facility;
4
   (B) power purchase provisions, which shall: 
5
    (i) provide that the utility party to such 
6
 sourcing agreement shall pay the contract price 
7
 for electricity delivered under such sourcing 
8
 agreement; 
9
    (ii) require delivery of electricity to the 
10
 regional transmission organization market of the 
11
 utility that is party to such sourcing agreement;
12
    (iii) require the utility party to such 
13
 sourcing agreement to buy from the initial clean 
14
 coal facility in each hour an amount of energy 
15
 equal to all clean coal energy made available from 
16
 the initial clean coal facility during such hour 
17
 times a fraction, the numerator of which is such 
18
 utility's retail market sales of electricity 
19
 (expressed in kilowatthours sold) in the State 
20
 during the prior calendar month and the 
21
 denominator of which is the total retail market 
22
 sales of electricity (expressed in kilowatthours 
23
 sold) in the State by utilities during such prior 
24
 month and the sales of electricity (expressed in 
25
 kilowatthours sold) in the State by alternative 
26
 retail electric suppliers during such prior month 
 


 






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1
 that are subject to the requirements of this 
2
 subsection (d) and paragraph (5) of subsection (d) 
3
 of Section 16-115 of the Public Utilities Act, 
4
 provided that the amount purchased by the utility 
5
 in any year will be limited by paragraph (2) of 
6
 this subsection (d); and
7
    (iv) be considered pre-existing contracts in 
8
 such utility's procurement plans for eligible 
9
 retail customers;
10
   (C) contract for differences provisions, which 
11
 shall:
12
    (i) require the utility party to such sourcing 
13
 agreement to contract with the initial clean coal 
14
 facility in each hour with respect to an amount of 
15
 energy equal to all clean coal energy made 
16
 available from the initial clean coal facility 
17
 during such hour times a fraction, the numerator of 
18
 which is such utility's retail market sales of 
19
 electricity (expressed in kilowatthours sold) in 
20
 the utility's service territory in the State 
21
 during the prior calendar month and the 
22
 denominator of which is the total retail market 
23
 sales of electricity (expressed in kilowatthours 
24
 sold) in the State by utilities during such prior 
25
 month and the sales of electricity (expressed in 
26
 kilowatthours sold) in the State by alternative 
 


 






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1
 retail electric suppliers during such prior month 
2
 that are subject to the requirements of this 
3
 subsection (d) and paragraph (5) of subsection (d) 
4
 of Section 16-115 of the Public Utilities Act, 
5
 provided that the amount paid by the utility in any 
6
 year will be limited by paragraph (2) of this 
7
 subsection (d);
8
    (ii) provide that the utility's payment 
9
 obligation in respect of the quantity of 
10
 electricity determined pursuant to the preceding 
11
 clause (i) shall be limited to an amount equal to 
12
 (1) the difference between the contract price 
13
 determined pursuant to subparagraph (A) of 
14
 paragraph (3) of this subsection (d) and the 
15
 day-ahead price for electricity delivered to the 
16
 regional transmission organization market of the 
17
 utility that is party to such sourcing agreement 
18
 (or any successor delivery point at which such 
19
 utility's supply obligations are financially 
20
 settled on an hourly basis) (the "reference 
21
 price") on the day preceding the day on which the 
22
 electricity is delivered to the initial clean coal 
23
 facility busbar, multiplied by (2) the quantity of 
24
 electricity determined pursuant to the preceding 
25
 clause (i); and
26
    (iii) not require the utility to take physical 
 


 






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1
 delivery of the electricity produced by the 
2
 facility;
3
   (D) general provisions, which shall:
4
    (i) specify a term of no more than 30 years, 
5
 commencing on the commercial operation date of the 
6
 facility;
7
    (ii) provide that utilities shall maintain 
8
 adequate records documenting purchases under the 
9
 sourcing agreements entered into to comply with 
10
 this subsection (d) and shall file an accounting 
11
 with the load forecast that must be filed with the 
12
 Agency by July 15 of each year, in accordance with 
13
 subsection (d) of Section 16-111.5 of the Public 
14
 Utilities Act. 
15
    (iii) provide that all costs associated with 
16
 the initial clean coal facility will be 
17
 periodically reported to the Federal Energy 
18
 Regulatory Commission and to purchasers in 
19
 accordance with applicable laws governing 
20
 cost-based wholesale power contracts;
21
    (iv) permit the Illinois Power Agency to 
22
 assume ownership of the initial clean coal 
23
 facility, without monetary consideration and 
24
 otherwise on reasonable terms acceptable to the 
25
 Agency, if the Agency so requests no less than 3 
26
 years prior to the end of the stated contract term;
 


 






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    (v) require the owner of the initial clean coal 
2
 facility to provide documentation to the 
3
 Commission each year, starting in the facility's 
4
 first year of commercial operation, accurately 
5
 reporting the quantity of carbon emissions from 
6
 the facility that have been captured and 
7
 sequestered and report any quantities of carbon 
8
 released from the site or sites at which carbon 
9
 emissions were sequestered in prior years, based 
10
 on continuous monitoring of such sites. If, in any 
11
 year after the first year of commercial operation, 
12
 the owner of the facility fails to demonstrate that 
13
 the initial clean coal facility captured and 
14
 sequestered at least 50% of the total carbon 
15
 emissions that the facility would otherwise emit 
16
 or that sequestration of emissions from prior 
17
 years has failed, resulting in the release of 
18
 carbon dioxide into the atmosphere, the owner of 
19
 the facility must offset excess emissions. Any 
20
 such carbon offsets must be permanent, additional, 
21
 verifiable, real, located within the State of 
22
 Illinois, and legally and practicably enforceable. 
23
 The cost of such offsets for the facility that are 
24
 not recoverable shall not exceed $15 million in any 
25
 given year. No costs of any such purchases of 
26
 carbon offsets may be recovered from a utility or 
 


 






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1
 its customers. All carbon offsets purchased for 
2
 this purpose and any carbon emission credits 
3
 associated with sequestration of carbon from the 
4
 facility must be permanently retired. The initial 
5
 clean coal facility shall not forfeit its 
6
 designation as a clean coal facility if the 
7
 facility fails to fully comply with the applicable 
8
 carbon sequestration requirements in any given 
9
 year, provided the requisite offsets are 
10
 purchased. However, the Attorney General, on 
11
 behalf of the People of the State of Illinois, may 
12
 specifically enforce the facility's sequestration 
13
 requirement and the other terms of this contract 
14
 provision. Compliance with the sequestration 
15
 requirements and offset purchase requirements 
16
 specified in paragraph (3) of this subsection (d) 
17
 shall be reviewed annually by an independent 
18
 expert retained by the owner of the initial clean 
19
 coal facility, with the advance written approval 
20
 of the Attorney General. The Commission may, in the 
21
 course of the review specified in item (vii), 
22
 reduce the allowable return on equity for the 
23
 facility if the facility wilfully fails to comply 
24
 with the carbon capture and sequestration 
25
 requirements set forth in this item (v);
26
    (vi) include limits on, and accordingly 
 


 






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1
 provide for modification of, the amount the 
2
 utility is required to source under the sourcing 
3
 agreement consistent with paragraph (2) of this 
4
 subsection (d);
5
    (vii) require Commission review: (1) to 
6
 determine the justness, reasonableness, and 
7
 prudence of the inputs to the formula referenced in 
8
 subparagraphs (A)(i) through (A)(iii) of paragraph 
9
 (3) of this subsection (d), prior to an adjustment 
10
 in those inputs including, without limitation, the 
11
 capital structure and return on equity, fuel 
12
 costs, and other operations and maintenance costs 
13
 and (2) to approve the costs to be passed through 
14
 to customers under the sourcing agreement by which 
15
 the utility satisfies its statutory obligations. 
16
 Commission review shall occur no less than every 3 
17
 years, regardless of whether any adjustments have 
18
 been proposed, and shall be completed within 9 
19
 months; 
20
    (viii) limit the utility's obligation to such 
21
 amount as the utility is allowed to recover through 
22
 tariffs filed with the Commission, provided that 
23
 neither the clean coal facility nor the utility 
24
 waives any right to assert federal pre-emption or 
25
 any other argument in response to a purported 
26
 disallowance of recovery costs;
 


 






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1
    (ix) limit the utility's or alternative retail 
2
 electric supplier's obligation to incur any 
3
 liability until such time as the facility is in 
4
 commercial operation and generating power and 
5
 energy and such power and energy is being delivered 
6
 to the facility busbar;
7
    (x) provide that the owner or owners of the 
8
 initial clean coal facility, which is the 
9
 counterparty to such sourcing agreement, shall 
10
 have the right from time to time to elect whether 
11
 the obligations of the utility party thereto shall 
12
 be governed by the power purchase provisions or the 
13
 contract for differences provisions;
14
    (xi) append documentation showing that the 
15
 formula rate and contract, insofar as they relate 
16
 to the power purchase provisions, have been 
17
 approved by the Federal Energy Regulatory 
18
 Commission pursuant to Section 205 of the Federal 
19
 Power Act;
20
    (xii) provide that any changes to the terms of 
21
 the contract, insofar as such changes relate to the 
22
 power purchase provisions, are subject to review 
23
 under the public interest standard applied by the 
24
 Federal Energy Regulatory Commission pursuant to 
25
 Sections 205 and 206 of the Federal Power Act; and
26
    (xiii) conform with customary lender 
 


 






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1
 requirements in power purchase agreements used as 
2
 the basis for financing non-utility generators. 
3
  (4) Effective date of sourcing agreements with the 
4
 initial clean coal facility. Any proposed sourcing 
5
 agreement with the initial clean coal facility shall not 
6
 become effective unless the following reports are prepared 
7
 and submitted and authorizations and approvals obtained:
8
    (i) Facility cost report. The owner of the 
9
 initial clean coal facility shall submit to the 
10
 Commission, the Agency, and the General Assembly a 
11
 front-end engineering and design study, a facility 
12
 cost report, method of financing (including but 
13
 not limited to structure and associated costs), 
14
 and an operating and maintenance cost quote for the 
15
 facility (collectively "facility cost report"), 
16
 which shall be prepared in accordance with the 
17
 requirements of this paragraph (4) of subsection 
18
 (d) of this Section, and shall provide the 
19
 Commission and the Agency access to the work 
20
 papers, relied upon documents, and any other 
21
 backup documentation related to the facility cost 
22
 report.
23
    (ii) Commission report. Within 6 months 
24
 following receipt of the facility cost report, the 
25
 Commission, in consultation with the Agency, shall 
26
 submit a report to the General Assembly setting 
 


 






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1
 forth its analysis of the facility cost report. 
2
 Such report shall include, but not be limited to, a 
3
 comparison of the costs associated with 
4
 electricity generated by the initial clean coal 
5
 facility to the costs associated with electricity 
6
 generated by other types of generation facilities, 
7
 an analysis of the rate impacts on residential and 
8
 small business customers over the life of the 
9
 sourcing agreements, and an analysis of the 
10
 likelihood that the initial clean coal facility 
11
 will commence commercial operation by and be 
12
 delivering power to the facility's busbar by 2016. 
13
 To assist in the preparation of its report, the 
14
 Commission, in consultation with the Agency, may 
15
 hire one or more experts or consultants, the costs 
16
 of which shall be paid for by the owner of the 
17
 initial clean coal facility. The Commission and 
18
 Agency may begin the process of selecting such 
19
 experts or consultants prior to receipt of the 
20
 facility cost report.
21
    (iii) General Assembly approval. The proposed 
22
 sourcing agreements shall not take effect unless, 
23
 based on the facility cost report and the 
24
 Commission's report, the General Assembly enacts 
25
 authorizing legislation approving (A) the 
26
 projected price, stated in cents per kilowatthour, 
 


 






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1
 to be charged for electricity generated by the 
2
 initial clean coal facility, (B) the projected 
3
 impact on residential and small business 
4
 customers' bills over the life of the sourcing 
5
 agreements, and (C) the maximum allowable return 
6
 on equity for the project; and
7
    (iv) Commission review. If the General 
8
 Assembly enacts authorizing legislation pursuant 
9
 to subparagraph (iii) approving a sourcing 
10
 agreement, the Commission shall, within 90 days of 
11
 such enactment, complete a review of such sourcing 
12
 agreement. During such time period, the Commission 
13
 shall implement any directive of the General 
14
 Assembly, resolve any disputes between the parties 
15
 to the sourcing agreement concerning the terms of 
16
 such agreement, approve the form of such 
17
 agreement, and issue an order finding that the 
18
 sourcing agreement is prudent and reasonable.
19
 The facility cost report shall be prepared as follows: 
20
   (A) The facility cost report shall be prepared by 
21
 duly licensed engineering and construction firms 
22
 detailing the estimated capital costs payable to one or 
23
 more contractors or suppliers for the engineering, 
24
 procurement and construction of the components 
25
 comprising the initial clean coal facility and the 
26
 estimated costs of operation and maintenance of the 
 


 






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1
 facility. The facility cost report shall include:
2
    (i) an estimate of the capital cost of the core 
3
 plant based on one or more front end engineering 
4
 and design studies for the gasification island and 
5
 related facilities. The core plant shall include 
6
 all civil, structural, mechanical, electrical, 
7
 control, and safety systems.
8
    (ii) an estimate of the capital cost of the 
9
 balance of the plant, including any capital costs 
10
 associated with sequestration of carbon dioxide 
11
 emissions and all interconnects and interfaces 
12
 required to operate the facility, such as 
13
 transmission of electricity, construction or 
14
 backfeed power supply, pipelines to transport 
15
 substitute natural gas or carbon dioxide, potable 
16
 water supply, natural gas supply, water supply, 
17
 water discharge, landfill, access roads, and coal 
18
 delivery.
19
   The quoted construction costs shall be expressed 
20
 in nominal dollars as of the date that the quote is 
21
 prepared and shall include (1) capitalized financing 
22
 costs during construction,
(2) taxes, insurance, and 
23
 other owner's costs, and (3) an assumed escalation in 
24
 materials and labor beyond the date as of which the 
25
 construction cost quote is expressed.
26
   (B) The front end engineering and design study for 
 


 






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1
 the gasification island and the cost study for the 
2
 balance of plant shall include sufficient design work 
3
 to permit quantification of major categories of 
4
 materials, commodities and labor hours, and receipt of 
5
 quotes from vendors of major equipment required to 
6
 construct and operate the clean coal facility.
7
   (C) The facility cost report shall also include an 
8
 operating and maintenance cost quote that will provide 
9
 the estimated cost of delivered fuel, personnel, 
10
 maintenance contracts, chemicals, catalysts, 
11
 consumables, spares, and other fixed and variable 
12
 operations and maintenance costs.
13
    (a) The delivered fuel cost estimate will be 
14
 provided by a recognized third party expert or 
15
 experts in the fuel and transportation industries.
16
    (b) The balance of the operating and 
17
 maintenance cost quote, excluding delivered fuel 
18
 costs will be developed based on the inputs 
19
 provided by duly licensed engineering and 
20
 construction firms performing the construction 
21
 cost quote, potential vendors under long-term 
22
 service agreements and plant operating agreements, 
23
 or recognized third party plant operator or 
24
 operators.
25
    The operating and maintenance cost quote 
26
 (including the cost of the front end engineering 
 


 






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1
 and design study) shall be expressed in nominal 
2
 dollars as of the date that the quote is prepared 
3
 and shall include (1) taxes, insurance, and other 
4
 owner's costs, and (2) an assumed escalation in 
5
 materials and labor beyond the date as of which the 
6
 operating and maintenance cost quote is expressed.
7
   (D) The facility cost report shall also include (i) 
8
 an analysis of the initial clean coal facility's 
9
 ability to deliver power and energy into the applicable 
10
 regional transmission organization markets and (ii) an 
11
 analysis of the expected capacity factor for the 
12
 initial clean coal facility. 
13
   (E) Amounts paid to third parties unrelated to the 
14
 owner or owners of the initial clean coal facility to 
15
 prepare the core plant construction cost quote, 
16
 including the front end engineering and design study, 
17
 and the operating and maintenance cost quote will be 
18
 reimbursed through Coal Development Bonds.
19
  (5) Re-powering and retrofitting coal-fired power 
20
 plants previously owned by Illinois utilities to qualify as 
21
 clean coal facilities. During the 2009 procurement 
22
 planning process and thereafter, the Agency and the 
23
 Commission shall consider sourcing agreements covering 
24
 electricity generated by power plants that were previously 
25
 owned by Illinois utilities and that have been or will be 
26
 converted into clean coal facilities, as defined by Section 
 


 






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1
 1-10 of this Act. Pursuant to such procurement planning 
2
 process, the owners of such facilities may propose to the 
3
 Agency sourcing agreements with utilities and alternative 
4
 retail electric suppliers required to comply with 
5
 subsection (d) of this Section and item (5) of subsection 
6
 (d) of Section 16-115 of the Public Utilities Act, covering 
7
 electricity generated by such facilities. In the case of 
8
 sourcing agreements that are power purchase agreements, 
9
 the contract price for electricity sales shall be 
10
 established on a cost of service basis. In the case of 
11
 sourcing agreements that are contracts for differences, 
12
 the contract price from which the reference price is 
13
 subtracted shall be established on a cost of service basis. 
14
 The Agency and the Commission may approve any such utility 
15
 sourcing agreements that do not exceed cost-based 
16
 benchmarks developed by the procurement administrator, in 
17
 consultation with the Commission staff, Agency staff and 
18
 the procurement monitor, subject to Commission review and 
19
 approval. The Commission shall have authority to inspect 
20
 all books and records associated with these clean coal 
21
 facilities during the term of any such contract.
22
  (6) Costs incurred under this subsection (d) or 
23
 pursuant to a contract entered into under this subsection 
24
 (d) shall be deemed prudently incurred and reasonable in 
25
 amount and the electric utility shall be entitled to full 
26
 cost recovery pursuant to the tariffs filed with the 
 


 






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1
 Commission. 
2
  (e) The draft procurement plans are subject to public 
3
 comment, as required by Section 16-111.5 of the Public 
4
 Utilities Act.
5
  (f) The Agency shall submit the final procurement plan 
6
 to the Commission. The Agency shall revise a procurement 
7
 plan if the Commission determines that it does not meet the 
8
 standards set forth in Section 16-111.5 of the Public 
9
 Utilities Act.
10
  (g) The Agency shall assess fees to each affected 
11
 utility to recover the costs incurred in preparation of the 
12
 annual procurement plan for the utility.
13
  (h) The Agency shall assess fees to each bidder to 
14
 recover the costs incurred in connection with a competitive 
15
 procurement process.

16
(Source: P.A. 95-481, eff. 8-28-07; 95-1027, eff. 6-1-09; 
17
96-159, eff. 8-10-09.)


18
 Section 99. Effective date. This Act takes effect upon 
19
becoming law.