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       Florida Senate - 2010                                    SB 2346
       By Senator Altman
       24-01031-10                                           20102346__
    1                        A bill to be entitled                      
    2         An act relating to renewable energy; creating s.
    3         366.925, F.S.; providing a short title; defining
    4         terms; requiring investor-owned electric utilities and
    5         participating municipal electric utilities and rural
    6         electric cooperatives to collect renewable energy fees
    7         from retail electric customers; providing for the
    8         deposit and use of such fees; providing procedures for
    9         municipal electric utilities and rural electric
   10         cooperatives to participate or terminate their
   11         participation; providing for the continuation of
   12         contract payments and the collection of renewable
   13         energy fees after a participating electric utility
   14         terminates its participation; providing eligibility
   15         criteria and application requirements for renewable
   16         energy facilities; authorizing the Florida Energy and
   17         Climate Commission to issue and revoke certificates of
   18         eligibility under certain circumstances and to adopt
   19         rules; requiring participating electric utilities to
   20         provide interconnection service and enter into
   21         purchase contracts with producers of certain types of
   22         renewable energy; providing requirements and limiting
   23         fees for such interconnection service; requiring
   24         certain provisions in purchase contracts; requiring
   25         the Public Service Commission to disburse certain
   26         funds for the payment of renewable energy incentives
   27         to eligible facilities; requiring the Public Service
   28         Commission to adopt a schedule of incentive payments
   29         based on certain requirements; requiring producers to
   30         provide certain proof related to their renewable
   31         energy facilities; authorizing the Public Service
   32         Commission to enter the premises and conduct
   33         inspections of certain renewable energy facilities;
   34         requiring that purchase contracts be approved by the
   35         Public Service Commission; requiring temporary
   36         reductions of incentive payments to cover shortfalls
   37         in renewable energy fee collections; providing for the
   38         termination of a facility’s incentive payments under
   39         certain circumstances; amending s. 366.11, F.S.;
   40         conforming provisions; providing an effective date.
   42         WHEREAS, the Legislature recognizes the vital role that the
   43  agricultural industry plays in the economy of this state and
   44  that growth in this industry can translate to greater economic
   45  benefits and job growth in this state, and
   46         WHEREAS, the Legislature also recognizes that one area for
   47  potential growth in the agricultural industry is to encourage
   48  the use of agricultural plant materials, farm waste, and feed
   49  stock to produce alternative energy resources that can be used
   50  to generate electricity, and
   51         WHEREAS, the Legislature recognizes that no opportunity
   52  currently exists in this state to allow for farm byproducts and
   53  other alternative resources to be used to create energy
   54  resources to generate electricity, NOW, THEREFORE,
   56  Be It Enacted by the Legislature of the State of Florida:
   58         Section 1. Section 366.925, Florida Statutes, is created to
   59  read:
   60         366.925Renewable energy incentives for biomass, solar, and
   61  wind energy; retail electric customer fees.—
   62         (1)SHORT TITLE.—This section may be cited as the “Florida
   63  Farm to Energy Act.”
   64         (2)DEFINITIONS.—As used in this section, the term:
   65         (a)Biomass” means a power source that is comprised of,
   66  but not limited to, combustible residues or gases from forest
   67  products manufacturing, waste, byproducts, or products from
   68  agricultural and orchard crops, waste or coproducts from
   69  livestock and poultry operations, waste or byproducts from food
   70  processing, urban wood waste, municipal solid waste, municipal
   71  liquid waste treatment operations, and landfill gas.
   72         (b)“Biomass facility” means a facility that generates
   73  electricity through the controlled combustion of biomass as
   74  defined in s. 366.91 which is produced in the United States.
   75         (c)“Eligible renewable energy facility” means a biomass,
   76  solar, or wind energy facility that is issued a certificate of
   77  eligibility by the Florida Energy and Climate Commission.
   78         (d)“Interconnection service” means connection of a
   79  producer’s eligible renewable energy facility to an electric
   80  utility’s electric grid.
   81         (e)“Participating electric utility” means an investor
   82  owned electric utility or a municipal electric utility or rural
   83  electric cooperative that chooses to participate under paragraph
   84  (3)(c).
   85         (f)“Purchase contract” means an agreement by which an
   86  electric utility pays a producer for the electricity generated
   87  by the producer’s eligible renewable energy facility and
   88  delivered to the utility’s electric grid.
   89         (g)“Solar energy facility” means a facility that generates
   90  electricity by converting solar radiation into electricity.
   91         (h)“Wind energy facility” means a facility that generates
   92  electricity by converting the kinetic energy of wind into
   93  electricity.
   95  UTILITIES.—
   96         (a)Effective January 1, 2011, each investor-owned electric
   97  utility, and each municipal electric utility or rural electric
   98  cooperative that chooses to participate under paragraph (c),
   99  shall impose a renewable energy fee upon each of its retail
  100  electric service customers of a certain amount as determined by
  101  the Public Service Commission. The fees shall be collected and
  102  deposited monthly into the Florida Public Service Regulatory
  103  Trust Fund according to rules adopted by the commission.
  104         (b)Renewable energy fees collected from customers of an
  105  investor-owned electric utility shall be used to pay renewable
  106  energy incentives to facilities located within the territory
  107  served by any investor-owned electric utility in the state. Fees
  108  collected from customers of a municipal electric utility or
  109  rural electric cooperative may be used only to pay renewable
  110  energy incentives to facilities located within the territory
  111  served by that respective utility or cooperative.
  112         (c)A municipal electric utility or rural electric
  113  cooperative that, upon approval of its governing authority,
  114  chooses to participate shall notify the commission in the format
  115  prescribed by the commission. Such notice must include the date
  116  that the municipal electric utility or rural electric
  117  cooperative will begin to impose and collect renewable energy
  118  fees.
  119         (d)A municipal electric utility or rural electric
  120  cooperative that chooses to terminate its participation shall
  121  notify the commission in the format prescribed by the
  122  commission. Such notice must include the date that the municipal
  123  electric utility or rural electric cooperative will cease to
  124  impose renewable energy fees. The commission, upon receipt of
  125  such notice, may not approve new purchase contracts for
  126  additional facilities within the territory served by that
  127  utility or cooperative. However, the municipal electric utility
  128  or rural electric cooperative shall continue payments under any
  129  previously approved purchase contract, and shall continue
  130  collecting renewable energy fees needed for payment of
  131  incentives pursuant to subsection (7), until expiration of the
  132  contract.
  135         (a)A producer seeking a certificate of eligibility for the
  136  producer’s biomass, solar, or wind energy facility shall apply
  137  to the Florida Energy and Climate Commission. An application
  138  must be submitted in the format prescribed by the Florida Energy
  139  and Climate Commission and must include:
  140         1.The location of the producer’s biomass, solar, or wind
  141  energy facility.
  142         2.A description of the primary energy input of the
  143  producer’s facility, whether biomass, solar, or wind, and, if
  144  the facility’s primary energy input is biomass, a description of
  145  the type of biomass input, which may include, but is not limited
  146  to, landfill gas, manure digester gas, municipal solid waste,
  147  sewage digester gas, wood, or agricultural byproduct.
  148         3.Proof that the producer’s facility has qualifying
  149  facility status pursuant to 18 C.F.R. Part 292, whether self
  150  certified or certified by the Federal Energy Regulatory
  151  Commission.
  152         (b)The Florida Energy and Climate Commission shall issue a
  153  certificate of eligibility for a producer’s biomass, solar, or
  154  wind energy facility if:
  155         1.The application is complete and accompanied by an
  156  application fee not to exceed $250.
  157         2.The facility is located within the territory served by a
  158  participating electric utility.
  159         (c)The Florida Energy and Climate Commission shall revoke
  160  a facility’s certificate of eligibility if the Federal Energy
  161  Regulatory Commission revokes the facility’s qualifying facility
  162  status.
  163         (d)The Florida Energy and Climate Commission may adopt
  164  rules to administer this subsection.
  165         (5)INTERCONNECTION SERVICE.—Notwithstanding any other
  166  provision of law:
  167         (a)A participating electric utility that serves a
  168  territory in which an eligible renewable energy facility is
  169  located shall, within 60 days after the producer’s request,
  170  provide the facility with interconnection service and enter into
  171  a purchase contract with the producer.
  172         (b)The interconnection service must comply with the
  173  interconnection standards adopted by the commission and the
  174  Florida Reliability Coordinating Council, Inc.
  175         (c)The interconnection service must include installation
  176  of supply oriented metering equipment that measures the
  177  electricity generated by the producer’s eligible renewable
  178  energy facility and delivered to the utility’s electric grid.
  179         (d)An electric utility may not charge fees for
  180  interconnection service that exceed the utility’s incremental
  181  cost of providing such service.
  182         (6)PURCHASE CONTRACTS.—
  183         (a)A purchase contract must provide for the participating
  184  electric utility’s purchase of the electricity generated by the
  185  producer’s eligible renewable energy facility and delivered to
  186  the utility’s electric grid.
  187         (b)The Public Service Commission shall establish
  188  requirements for the purchase of energy and capacity by
  189  participating electric utilities from eligible renewable energy
  190  facilities. A purchase contract shall contain payment provisions
  191  for energy and capacity which are based upon the utility’s full
  192  avoided costs as defined in s. 366.051; however, capacity
  193  payments are not required if, due to the operational
  194  characteristics of the renewable energy facility or the
  195  anticipated peak and off-peak availability and capacity factor
  196  of the utility’s avoided unit, the producer is unlikely to
  197  provide any capacity value to the utility or the electric grid
  198  during the contract term.
  199         (c)Prudent and reasonable costs associated with a purchase
  200  contract shall be recovered from the ratepayers of the
  201  contracting utility, without differentiation among customer
  202  classes, through the appropriate cost-recovery clause mechanism
  203  administered by the commission.
  204         (d)A purchase contract must provide a contract term of at
  205  least 20 years.
  206         (e)A purchase contract must provide for the renewable
  207  energy facility’s environmental attributes, including, but not
  208  limited to, greenhouse gas emissions credits and renewable
  209  energy certificates to transfer to the contracting utility.
  211         (a)Effective January 1, 2011, the Public Service
  212  Commission shall disburse to each participating electric utility
  213  from among the renewable energy fees collected pursuant to
  214  subsection (3) funds for the payment of renewable energy
  215  incentives to eligible renewable energy facilities that have
  216  entered into purchase contracts with the utility.
  217         (b)The renewable energy incentives shall be paid according
  218  to a schedule adopted by the Public Service Commission based on
  219  market research of the various costs of generating renewable
  220  energy. The incentive payment rates, together with the utility’s
  221  full avoided costs paid under the purchase contract, must be
  222  sufficient to ensure that the development of renewable energy
  223  generation is cost-effective and profitable for producers.
  224         (c)The schedule shall establish differentiated rates for
  225  incentive payments based on a facility’s primary energy input as
  226  described in subparagraph (4)(a)2., the methodology or
  227  technology used by the facility to generate electricity, and the
  228  size of the facility.
  229         (d)A producer must provide proof of the primary energy
  230  input and the quantity and origin of the resources used to
  231  generate electricity at the producer’s renewable energy
  232  facility.
  233         (e)The commission or its duly authorized representatives
  234  may during all reasonable hours enter the premises of a
  235  renewable energy facility receiving incentive payments under
  236  this section and may set up and use on the premises all
  237  necessary apparatus and appliances for the purpose of making
  238  investigations, inspections, examinations, and tests. The
  239  facility has the right to be notified of and be represented
  240  during such investigations, inspections, examinations, and
  241  tests.
  244         (a)A purchase contract may not take effect until approved
  245  by the commission. The commission may approve a purchase
  246  contract only if:
  247         1.The contracting utility is a participating electric
  248  utility.
  249         2.The producer’s renewable energy facility has a
  250  certificate of eligibility issued by the Florida Energy and
  251  Climate Commission.
  252         3.The terms and conditions of the purchase contract comply
  253  with the requirements of this section, including, but not
  254  limited to, provisions for the utility’s payment of its full
  255  avoided costs.
  256         4.Based on the commission’s analysis, the renewable energy
  257  fees collected pursuant to subsection (3) are estimated to
  258  produce sufficient revenues to pay renewable energy incentives
  259  to the facility through the end of the contract term.
  260         (b)If the amount of renewable energy fees available for
  261  disbursement to participating electric utilities is not
  262  sufficient for payment of renewable energy incentives to all
  263  renewable energy facilities whose purchase contracts are
  264  approved by the commission, the commission shall:
  265         1.Proportionately reduce each facility’s incentive
  266  payments to cover the shortfall.
  267         2.Not approve new purchase contracts for additional
  268  facilities whose incentive payments would be paid from those
  269  renewable energy fees.
  270         3.As additional renewable energy fees become available for
  271  disbursement, increase each facility’s incentive payments until
  272  the payments are current and any amounts of unpaid incentives
  273  caused by the payment reductions are paid.
  274         (c)A renewable energy facility shall cease to receive
  275  incentive payments if:
  276         1.Its certificate of eligibility is revoked by the Florida
  277  Energy and Climate Commission.
  278         2.The Florida Energy and Climate Commission determines
  279  that the facility has failed to provide proof of the primary
  280  energy input and the quantity and origin of the resources used
  281  to generate electricity at the facility.
  282         Section 2. Subsection (1) of section 366.11, Florida
  283  Statutes, is amended to read:
  284         366.11 Certain exemptions.—
  285         (1) No provision of this chapter shall apply in any manner,
  286  other than as specified in ss. 366.04, 366.05(7) and (8),
  287  366.051, 366.055, 366.093, 366.095, 366.14, 366.80-366.85, and
  288  366.91, and 366.925 to utilities owned and operated by
  289  municipalities, whether within or without any municipality, or
  290  by cooperatives organized and existing under the Rural Electric
  291  Cooperative Law of the state, or to the sale of electricity,
  292  manufactured gas, or natural gas at wholesale by any public
  293  utility to, and the purchase by, any municipality or cooperative
  294  under and pursuant to any contracts now in effect or which may
  295  be entered into in the future, when such municipality or
  296  cooperative is engaged in the sale and distribution of
  297  electricity or manufactured or natural gas, or to the rates
  298  provided for in such contracts.
  299         Section 3. This act shall take effect July 1, 2010.

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