House File 669 H-1062 Amend House File 669 as follows: 1 1. By striking everything after the enacting clause and 2 inserting: 3 < Section 1. NEW SECTION . 476.49 Private generation rates 4 —— infrastructure support options for customers. 5 1. The general assembly recognizes the importance of 6 electric utility infrastructure, including electric generation, 7 transmission, and distribution systems, to provide electric 8 service to all customers in this state, whether electricity 9 is generated by a public utility, by a customer, or on behalf 10 of a customer. The general assembly also recognizes that 11 tariffs for electric service are traditionally designed for 12 the provision of full electric service to customers, not 13 taking into account the private generation of electricity. It 14 is the intent of the general assembly to require customers 15 who utilize private generation to pay their share of costs 16 of electric utility infrastructure, thereby eliminating 17 cross-subsidization. It is also the intent of the general 18 assembly to provide private generation customers with options 19 to pay their share of costs. 20 2. For purposes of this section, unless the context 21 otherwise requires: 22 a. “Avoided cost” means the energy rate paid by an electric 23 utility for energy purchases from a private generation customer 24 established in the electric utility’s board-approved tariff for 25 cogeneration facilities and small power production facilities 26 and in accordance with section 476.43. 27 b. “Private generation customer” means an electric utility 28 customer who utilizes a private generation facility. 29 c. (1) “Private generation facility” means an alternate 30 energy production facility, as defined in section 476.42, that 31 is owned, leased, operated by, or operated on behalf of a 32 private generation customer and whose production of electricity 33 is used to offset a portion or all of the customer’s 34 electricity bill or usage that would otherwise be purchased 35 -1- HF669.1035 (1) 88 (amending this HF 669 to CONFORM to SF 583) gh/rn 1/ 5 #1.

from an electric utility. 1 (2) “Private generation facility” does not include any of 2 the following: 3 (a) A cogeneration facility as defined in 18 C.F.R. pt. 292, 4 subpt. B, including without limitation combined heat and power 5 facilities. 6 (b) A facility that produces renewable fuel as defined 7 in section 214A.1, which is registered with the United 8 States environmental protection agency as a manufacturer, in 9 accordance with the requirements set forth in 40 C.F.R. §79.4. 10 (c) A facility that utilizes a de minimus amount of biomass 11 in its operations. For purposes of this subparagraph division, 12 “de minimus” means less than ten percent of all fuel utilized in 13 the generation processes. 14 (d) A private generation facility with a nameplate 15 generating capacity greater than one megawatt. 16 3. A rate-regulated electric utility may file tariffs with 17 the board applicable to any private generation customer who 18 utilizes a private generation facility installed on or after 19 the date a tariff is approved pursuant to subsection 4. All 20 tariff rates charged to a private generation customer for 21 electric service shall recover the electric utility’s actual 22 cost of providing electric service to the applicable customer 23 class, as determined by the board in the electric utility’s 24 most recently approved rate proceeding. Tariffs filed pursuant 25 to this section shall be designed to ensure that a private 26 generation customer pays for electric utility infrastructure 27 costs. Tariffs filed pursuant to this section shall require a 28 private generation customer to choose one of the following rate 29 structures for the provision of electric service: 30 a. A minimum infrastructure charge rate structure whereby 31 the private generation customer pays a minimum amount each 32 month, or the private generation customer’s applicable standard 33 electric service bill, whichever is higher. The private 34 generation customer’s applicable standard electric service 35 -2- HF669.1035 (1) 88 (amending this HF 669 to CONFORM to SF 583) gh/rn 2/ 5

bill shall be calculated using the applicable standard retail 1 tariff. This tariff rate structure shall allow the private 2 generation facility to offset the private generation customer’s 3 energy usage, and shall allow excess energy to carry forward 4 in the form of excess energy credits to offset the private 5 generation customer’s energy usage in future billing periods. 6 This tariff rate structure shall also include an annual 7 cash-out of excess energy credits at a rate that does not 8 exceed the electric utility’s avoided cost. 9 b. A multi-part rate structure whereby rates applicable 10 to the customer include, at a minimum, a fixed basic service 11 charge, an energy charge designed to recover variable costs, 12 and a monthly demand charge designed to ensure that the 13 private generation customer pays for fixed electric utility 14 infrastructure costs. This tariff rate structure shall 15 allow the private generation facility to offset the private 16 generation customer’s energy usage, and shall allow excess 17 energy to carry forward in the form of excess energy credits to 18 offset the private generation customer’s energy usage in future 19 billing periods. This tariff rate structure shall also include 20 an annual cash-out of excess energy credits at a rate that does 21 not exceed the electric utility’s avoided cost. 22 c. A buy all and sell all rate structure whereby the private 23 generation facility’s output is measured separately from the 24 private generation customer’s consumption. All electricity 25 consumed shall be purchased from the electric utility and all 26 electricity generated shall be sold to the electric utility on 27 a monthly basis. Rates applicable to the private generation 28 customer for all electricity purchased from the electric 29 utility shall be the applicable standard retail tariff. 30 Rates applicable for electricity purchased from the private 31 generation customer shall not exceed the electric utility’s 32 avoided cost. 33 d. A rate structure filed by the electric utility that 34 recovers the electric utility’s cost of providing electric 35 -3- HF669.1035 (1) 88 (amending this HF 669 to CONFORM to SF 583) gh/rn 3/ 5

service to the applicable customer class, subject to board 1 approval. 2 4. The board shall review a tariff filed pursuant to this 3 section for compliance with this section, and shall approve the 4 tariff as filed or docket the tariff for review in a formal 5 proceeding pursuant to section 476.6, and thereafter either 6 approve the tariff or modify the tariff to meet compliance 7 with this section within six months of the date of docketing. 8 If the board fails to complete a review of the tariff within 9 six months of the date of filing, the tariff shall be deemed 10 approved. A tariff approved pursuant to this subsection shall 11 supersede any previously approved tariffs applicable to private 12 generation customers, except as provided in subsection 5. 13 5. A private generation customer who utilizes a private 14 generation facility pursuant to a tariff approved by the board 15 on or before the effective date of this Act may continue to 16 receive electric service pursuant to the preexisting tariff for 17 the remaining duration of the contract involving the private 18 generation facility, regardless of any subsequent change in 19 ownership of such private generation facility. However, if the 20 private generation customer terminates electric service with 21 the electric utility, the preexisting tariff shall no longer 22 apply and the private generation customer shall be required to 23 receive electric service pursuant to a tariff approved pursuant 24 to subsection 4, provided that the electric utility filed such 25 tariff with the board. 26 6. Nothing in this section shall preclude a customer 27 from entering into a contract with an electric utility as an 28 alternate energy production facility, cogeneration and small 29 power production facility, or a standby and supplemental power 30 service customer under the terms of the electric utility’s 31 separate alternate energy production facility, cogeneration and 32 small power production facility, or standby and supplemental 33 power service tariffs filed pursuant to the federal Public 34 Utility Regulatory Policies Act of 1978, 16 U.S.C. §2601 et 35 -4- HF669.1035 (1) 88 (amending this HF 669 to CONFORM to SF 583) gh/rn 4/ 5