Bill Text: NH SB440 | 2022 | Regular Session | Introduced
Bill Title: Relative to the office of offshore wind industry development.
Spectrum: Strong Partisan Bill (Democrat 11-1)
Status: (Passed) 2022-06-08 - Signed by the Governor on 06/07/2022; Chapter 0177; Effective 06/07/2022 [SB440 Detail]
Download: New_Hampshire-2022-SB440-Introduced.html
SB 440-FN - AS INTRODUCED
2022 SESSION
22-3011
12/08
SENATE BILL 440-FN
AN ACT relative to approval of offshore wind energy contracts.
SPONSORS: Sen. Watters, Dist 4; Sen. Sherman, Dist 24; Sen. D'Allesandro, Dist 20; Sen. Avard, Dist 12; Sen. Rosenwald, Dist 13; Sen. Whitley, Dist 15; Sen. Soucy, Dist 18; Sen. Cavanaugh, Dist 16; Sen. Prentiss, Dist 5; Rep. Cali-Pitts, Rock. 30; Rep. McGhee, Hills. 27; Rep. Wall, Straf. 6
COMMITTEE: Energy and Natural Resources
-----------------------------------------------------------------
ANALYSIS
This bill authorizes the public utilities commission to approve power purchase agreements for wind energy produced in the Gulf of Maine and establishes the clean energy resources committee to review said agreements.
- - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - -
Explanation: Matter added to current law appears in bold italics.
Matter removed from current law appears [in brackets and struckthrough.]
Matter which is either (a) all new or (b) repealed and reenacted appears in regular type.
22-3011
12/08
STATE OF NEW HAMPSHIRE
In the Year of Our Lord Two Thousand Twenty Two
AN ACT relative to approval of offshore wind energy contracts.
Be it Enacted by the Senate and House of Representatives in General Court convened:
1 New Subdivision; Gulf of Maine Clean Energy Resources. Amend RSA 362-F by inserting after section 15 the following new subdivision:
Gulf of Maine Clean Energy Resources
362-F:16 Definitions. In this subdivision:
I. “Clean energy resources” means electricity or hydrogen produced by wind turbines in the Gulf of Maine.
II. "Commercially reasonable” means terms and pricing that are reasonably consistent with what an experienced power market analyst would expect to see in transactions involving regional-energy resources and regional-energy infrastructure and include having a credible project operation date, contingent on final permitting, as determined by the commission.
III. "Commission" means the public utilities commission.
362-F:17 Public Utilities Commission Evaluation Criteria.
I. The public utilities commission may approve power purchase agreements if the commission determines that the clean energy resources from a provider to be used by an energy distribution company, or by a community power program, under the agreement::
(a) Are recommended by the clean energy resources committee established in RSA 362-F:18;
(b) Provide adequate energy with enhanced electricity distribution reliability, where there is a clear public need and a reasonable price over the term of the contract;
(c) Contribute to reducing winter electricity price spikes;
(d) Are cost effective to electric ratepayers in New Hampshire over the term of the contract taking into consideration potential economic benefit, greenhouse gas and other polluting emission reductions and other health and environmental benefits to the ratepayers, and, where feasible, create and foster employment and economic development in New Hampshire.
(e) Avoid line loss and mitigate transmission costs to the extent possible and ensure that transmission cost overruns, if any, are not borne by ratepayers;
(f) Are commercially reasonable;
(g) Allow contracts for clean energy generation resources to be paired with energy storage systems;
(h) Address reliable energy delivery in winter months;
(i) Adequately demonstrate project viability and that the bidder has the technical, financial, and managerial capabilities to perform in a commercially reasonable time frame;
(j) Avoid, minimize, and mitigate impacts to wildlife, natural resources, ecosystems, and traditional or existing water-dependent uses, including but not limited to, commercial and recreational fishing and transit lanes, and other commercial and recreational maritime activities;
(k) Complies with relevant consistency standards;
(l) Complies with relevant mitigation requirements;
(m) Creates energy diversity for New Hampshire’s electricity supply.
II. The public utilities commission shall determine whether an agreement is commercially reasonable pursuant to paragraph I(f). The commission shall find an agreement commercially reasonable if the benefits to New Hampshire exceed the cost of the project. The commission shall determine, based on the preponderance of the evidence, that the total energy security, reliability, environmental, and economic benefits to the state of New Hampshire and its ratepayers exceed the costs of such projects. If there is a dispute about whether any terms or pricing are commercially reasonable, the commission shall make the final determination after evidentiary hearings.
III. A proposed agreement shall be subject to the review and approval of the public utilities commission. As part of its approval process, the commission shall consider recommendations by the attorney general, which shall be submitted to the commission within 45 days following the filing of such contracts with the commission. The commission shall consider both the potential costs and benefits of such contracts and shall approve a contract only upon a finding that it is a cost effective mechanism for procuring renewable energy generation on a long-term basis taking into account the factors outlined in the clean energy resources committee selection process established in RSA 362-F:18.
IV. The clean energy resources committee and the commission may jointly develop requirements for a bond or other security to ensure performance with requirements under this section. If this section is subjected to a legal challenge, the commission may suspend the applicability of the challenged provision during the pendency of the action until a final resolution, including any appeals, is obtained and shall issue an order and take other actions as are necessary to ensure that the provisions not subject to the challenge are implemented expeditiously to achieve the public purposes of this section.
362-F:18 Renewable Energy Credits.
I. A distribution company may elect to use any energy purchased under contracts described in RSA 362-F:16 for sale to its customers and may elect to retain renewable energy certificates to meet the applicable annual renewable portfolio standard requirements under RSA 362-F:3. If the energy and renewable energy certificates are not so used, the distribution companies shall sell the purchased energy into the wholesale market and, provided that the commission has not notified the distribution company that the renewable energy certificates should be retained to facilitate reaching emission reduction targets pursuant to RSA 362-F:3, shall sell the purchased renewable energy certificates to minimize the costs to ratepayers under the contract. If a distribution company sells the purchased energy into the wholesale market and sells the renewable energy certificates, the distribution company shall net the cost of payments made to projects under the contracts against the net proceeds obtained from the sale of energy and renewable energy certificates, and the difference shall be credited or charged to all distribution customers through a uniform fully reconciling annual factor in distribution rates, subject to review and approval of the commission.
II. If a distribution company sells the purchased energy into the wholesale market and auctions the renewable energy certificates as described in this section, the distribution company shall net the cost of payments made to projects under the contracts against the net proceeds obtained from the sale of energy and renewable energy certificates, and the difference shall be credited or charged to all distribution customers through a uniform fully reconciling annual factor in distribution rates, subject to review and approval of the commission.
III. The commission shall conduct periodic reviews to determine the impact on the energy and renewable energy certificate markets of the disposition of energy and renewable energy certificates under this section and may issue reports recommending legislative changes if it determines that actions are being taken that will adversely affect the energy and renewable energy certificate markets.
362-F:19 Clean Energy Resources Committee (CERC). There is hereby established the clean energy resources committee within in the department of energy.
I. The committee shall consist of the following members:
(a) The commissioner of the department of energy, or designee.
(b) The commissioner of the department of business and economic affairs, or designee.
(c) The commissioner of the department of environmental services, or designee.
(d) The executive director of the fish and game department, or designee.
(e) One representative of energy distribution companies, appointed by the governor.
(f) One representative of labor, appointed by the president of the New Hampshire AFL-CIO.
(g) One representative of commercial or recreational fisheries, appointed by the governor.
(h) An attorney from the department of justice, designated by the attorney general, with experience in energy procurement, who shall serve in a nonvoting, advisory capacity to the committee.
II. Members of the CERC shall serve without compensation. Appointed members shall each serve a term of 3 years.
III. The CERC shall review proposals from providers of clean energy resources, in accordance with RSA 362-F:16, and select proposals for electric distribution company submission to the commission.
IV. In solicitation and selection of proposals for offshore wind development, the CERC shall require selected bidders to include a plan to engage in a good faith negotiation of a project labor agreement for laborers, workers, and mechanics performing construction activities within the United States with respect to the project. Any solicitation issued pursuant to this section shall specify the minimum terms that such project labor agreements address.
V. In responding to any solicitations issued pursuant to this section, a bidder may include the bidder's plans for the use of skilled labor, including, but not limited to, for any construction and manufacturing components of the proposal including any outreach, hiring, and referral systems, or any combination thereof, that are affiliated with an apprenticeship training program and other workforce development education and training programs recognized by the New Hampshire department employment security.
VI. In responding to any solicitations issued pursuant to this section that involve activities in New Hampshire, including state waters, a bidder shall demonstrate that it has prepared or will prepare for the Bureau of Ocean Energy Management an environmental, fisheries, and transit lanes mitigation plan for the construction and operation of such offshore wind facilities, including provisions under 485-I, provided such plan shall include, but not be limited to, an explicit description of the best management practices the bidder will employ that are informed by the latest science at the time the proposal is made that will avoid, minimize, and mitigate any impacts to wildlife, natural resources, ecosystems, and traditional or existing water-dependent uses, including, but not limited to, commercial and recreational fishing, including aquaculture, and transit lanes. For each solicitation issued pursuant to this section, the commissioner of the department of environmental services and the executive director of the New Hampshire fish and game department shall inform the CERC concerning its input to the bidder on best practices for avoiding, minimizing, and mitigating any impacts to wildlife, natural resources, ecosystems, and traditional or existing water-dependent uses, including, but not limited to, commercial and recreational fishing, and transit lanes, during the construction and operation of facilities eligible pursuant to this section.
VII. The CERC shall select, and the public utilities commission shall contract with, an independent evaluator to monitor and report on the solicitation and bid selection process in order to assist the CERC in determining whether a proposal received pursuant to this section is reasonable and to be selected for submission to the commission in its consideration of contracts filed for approval. To ensure an open, fair, and transparent solicitation, and a bid selection process that is not unduly influenced by an affiliated company, the independent evaluator shall issue a report to the commission analyzing the timetable and method of solicitation and the solicitation process implemented by the distribution companies and the CERC and include recommendations, if any, for improving the process. Upon the opening of an investigation by the commission into a proposed contract for a winning bid proposal, the independent evaluator shall file a report with the commission summarizing and analyzing the solicitation and the bid selection process, and providing its independent assessment of whether all bids were evaluated in a fair and non-discriminatory manner. The independent evaluator shall have access to all information and data related to the competitive solicitation and bid selection process necessary to fulfill the purposes of this subsection, but shall ensure all proprietary information remains confidential. The commission shall consider the findings of the independent evaluator and may adopt recommendations made by the independent evaluator as a condition for approval. If the independent evaluator concludes in the findings that the solicitation and bid selection of a contract was not fair and objective and that the process was substantially prejudiced as a result, the commission shall reject the contract. The commission's cost of evaluation shall be directly assessed to the state’s distribution utilities and the New Hampshire Electric Cooperative as authorized by the public utilities commission.
VIII. The CERC shall consult interested parties and provide opportunities for submission of information in public meetings or other means by members of the public in the process of solicitation of proposals.
IX. The representatives of energy distribution companies on the CERC shall not participate in the selection of procurement proposals.
X. The CERC shall report on its activities annually to the governor, the senate president, the speaker of the house of representatives, and to the commission on offshore wind and port development established in RSA 374-F:10.
XI. All reasonable costs associated with the CERC solicitation and review of proposals pursuant to this section shall be recoverable through the same fully reconciling rate component for all customers of the electric distribution companies.
2 Effective Date. This act shall take effect 60 days after its passage.
22-3011
12/28/21
SB 440-FN- FISCAL NOTE
AS INTRODUCED
AN ACT relative to approval of offshore wind energy contracts.
FISCAL IMPACT:
Due to time constraints, the Office of Legislative Budget Assistant is unable to provide a fiscal note for this bill, as introduced, at this time. The Department of Energy was contacted for a fiscal note worksheet initially on 11/22/2021 and again on 12/14/2021. When completed, the fiscal note will be forwarded to the Senate Clerk's Office.
AGENCIES CONTACTED:
Department of Energy
