75th OREGON LEGISLATIVE ASSEMBLY--2010 Special Session

NOTE:  Matter within  { +  braces and plus signs + } in an
amended section is new. Matter within  { -  braces and minus
signs - } is existing law to be omitted. New sections are within
 { +  braces and plus signs + } .

LC 124

                           A-Engrossed

                         House Bill 3690
                Ordered by the House February 10
          Including House Amendments dated February 10

Sponsored by COMMITTEE ON SUSTAINABILITY AND ECONOMIC DEVELOPMENT

                             SUMMARY

The following summary is not prepared by the sponsors of the
measure and is not a part of the body thereof subject to
consideration by the Legislative Assembly. It is an editor's
brief statement of the essential features of the measure.

  Establishes different size categories and permits Public
Utility Commission to adjust deployment targets for solar
photovoltaic energy systems participating in solar energy system
pilot programs.
  Declares emergency, effective on passage.

                        A BILL FOR AN ACT
Relating to feed-in tariffs on solar photovoltaic energy systems;
  creating new provisions; amending ORS 757.360 and 757.365; and
  declaring an emergency.
Be It Enacted by the People of the State of Oregon:
  SECTION 1. ORS 757.360 is amended to read:
  757.360. As used in ORS 757.360 to 757.380:
  (1) 'Electric company' has the meaning given that term in ORS
757.600.
  (2) 'Nameplate capacity' means the maximum rated output of a
generator or other electric power production equipment under
specific conditions designated by the manufacturer.
  (3) 'Qualifying system' means:
  (a) An alternative energy system used for emergency backup
power by a state agency or facility that is at least 30 percent
more efficient than existing agency or facility sources,
including fuel cells; or
  (b) A solar photovoltaic energy system that:
    { - (A) Meets the electric company's customer load service
obligation as its primary purpose; - }
    { - (B) - }  { +  (A) + } Directly connects to an electric
company's electrical system within this state or indirectly
connects through the system of an electric company's retail
electricity consumer or the electric system of a third party that
is not an electric company's retail electricity consumer but
whose system is located within this state;
    { - (C) - }  { +  (B) + } Has meters or other devices in
place to monitor and measure the quantity of energy generated by
the solar photovoltaic energy system; and
    { - (D) - }  { +  (C) + } Meets any other siting, design,
interconnection, installation and electric output standards and
codes required by the laws of this state.
   { +  (4) 'Residential qualifying system' means a qualifying
system with a nameplate capacity of 10 kilowatts or less. + }
    { - (4) - }  { +  (5) + } 'Resource value' means the
estimated value to an electric company of the electricity
delivered from a solar photovoltaic energy system associated
with:
  (a) The avoided cost of energy, including avoided fuel price
volatility, minus the costs of firming and shaping the
electricity generated from the facility; { +  and + }
  (b) Avoided distribution and transmission cost  { - ; and - }
    { - (c) The renewable energy certificates established under
ORS 469A.130 - } .
    { - (5) - }  { +  (6) + } 'Retail electricity consumer' means
a retail electricity consumer, as defined in ORS 757.600, that is
located in Oregon and is served by an electric company.
   { +  (7) 'Small commercial qualifying system' means a
qualifying system with a nameplate capacity greater than 10
kilowatts and less than or equal to 100 kilowatts. + }
    { - (6) - }  { +  (8) + } 'Solar photovoltaic energy system'
means equipment and devices that have the primary purpose of
collecting solar energy and generating electricity by
photovoltaic effect.
  SECTION 2. ORS 757.365 is amended to read:
  757.365. (1)   { - Prior to April 1, 2010, - }  The Public
Utility Commission shall establish a pilot program for each
electric company to demonstrate the use and effectiveness of
volumetric incentive rates and payments for electricity { +  or
for the nonenergy attributes of electricity, or both, + }
 { - delivered - }  from solar photovoltaic energy systems that
are permanently installed in this state by retail electricity
consumers and that first become operational after the program
begins. The cumulative nameplate capacity of the qualifying
systems enrolled in all of the pilot programs may not exceed 25
megawatts of alternating current.  Qualifying systems enrolled in
the pilot program may not have nameplate generating capacity
greater than 500 kilowatts.
  (2) The commission by rule shall adopt requirements for the
pilot programs described in subsection (1) of this section. Each
electric company shall file for commission approval
 { - rate - }  { +  tariff + } schedules for the pilot programs
that conform to the requirements.
  (3) The commission may establish incentive rates for the pilot
programs to enable the development of the most efficient solar
photovoltaic energy systems.
  (4) A retail electricity consumer participating in a pilot
program may receive payments based on   { - the actual - }
electricity generated from solar photovoltaic energy system
output for 15 years from the consumer's date of enrollment in the
program, at rates or through a rate formula in a   { - rate - }
 { + tariff + } schedule established at the time of
enrollment { + , or at rates otherwise established at the time of
enrollment + }. The consumer thereafter may receive payments
based upon   { - the actual - }  electricity generated from the
qualifying system at a rate equal to the resource value.
  (5) The commission may adjust the   { - rate - }
 { + tariff + } schedule as needed for new pilot program
participants for the purpose of meeting the goal established in
subsection (1) of this section.  Once a retail electricity
consumer is enrolled in a program, the rates or rate formula for
determining payments to the consumer may not be modified.
  (6) The commission shall establish pilot programs designed to
attain a goal of 75 percent of the   { - energy - }  { +
capacity + } under each program to be   { - generated by - }
 { +  deployed by residential qualifying systems and small
commercial qualifying systems. + }   { - smaller-scale qualifying
systems within the allowed generating capacity range. - } The
commission by rule   { - shall define the size of a small-scale
qualifying system and may adjust the definition of size for
small-scale qualifying systems - }  { +  may adjust the
percentage goal for capacity deployed by residential and small
commercial qualifying systems + } based upon the costs of the
energy generated, the feasibility of attaining the goal and other
factors.   { - The commission may also adjust the maximum
percentage goal of energy generated by small-scale qualifying
systems based upon the same factors. - }
  (7) The commission may establish total generator nameplate
capacity limits for an electric company so that the rate impact
of the pilot program for any customer class does not exceed 0.25
percent of the electric company's revenue requirement for the
class in any year.
  (8) Ownership of renewable energy certificates established
under ORS 469A.130 that are associated with renewable energy
generation   { - that is sold to an electric company - }  under
the pilot programs must be transferred to the electric company
and may be used to comply with the renewable portfolio standard
described in ORS 469A.052 or 469A.055.
  (9) To the extent that   { - incentive - }  rates paid
 { - for electricity delivered to each electric company - }
under a pilot program exceed the resource value, qualifying
systems participating in the pilot programs are not eligible for
expenditures under ORS 757.612 (3)(b)(B) or tax credits under ORS
469.160 to 469.180 or 469.185 to 469.225.
  (10) All prudently incurred costs associated with compliance
with this section are recoverable in the rates of an electric
company.   { - The costs associated with the resource value are
recoverable in the rates of all retail electricity consumers.
Prudently incurred costs in excess of the resource value are
recoverable from customer classes eligible for the pilot programs
described in subsection (1) of this section. - }
  (11) The commission shall advise and assist the owners and
operators of qualifying systems in identifying and using grants,
incentive moneys, federal funding and other sources of
noninvestment financial support for the construction and
operation of qualifying systems.
  (12) The pilot programs described in subsection (1) of this
section close to new participants on  { + the earlier of:
  (a) + } March 31, 2015  { - , or when 25 megawatts of
alternating current of - }  { + ; or
  (b) The date the cumulative + } nameplate capacity of solar
photovoltaic energy systems  { + that + } have been permanently
installed by retail electricity consumers under the pilot
programs  { - , whichever is earlier - }  { +  equals 25
megawatts of alternating current + }.
  (13) The commission shall submit a report to the Legislative
Assembly by January 1 of each odd-numbered year   { - beginning
in 2011 - } . The report must evaluate the effectiveness of
 { - paying incentive rates under - }  the pilot programs
described in subsection (1) of this section compared to
 { - incentive rates described in subsection (9) of this
section - }   { + the effectiveness of expenditures under ORS
757.612 (3)(b)(B) or tax credits under ORS 469.160 to 469.180 or
469.185 to 469.225 + } for promoting the use of solar
photovoltaic energy systems and reducing system costs. The report
must also evaluate the estimated cost of the program to retail
electricity consumers.
  SECTION 3.  { + (1) The Public Utility Commission shall
establish the pilot programs described in ORS 757.365 so that
they are available to customers no later than July 1, 2010.
  (2) The commission shall submit the first report to the
Legislative Assembly under ORS 757.365 (13) no later than January
1, 2011. + }

  SECTION 4.  { + This 2010 Act being necessary for the immediate
preservation of the public peace, health and safety, an emergency
is declared to exist, and this 2010 Act takes effect on its
passage. + }
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