Senate File 2399 - Introduced
SENATE FILE
BY COMMITTEE ON WAYS AND MEANS
(SUCCESSOR TO SF 2325)
(SUCCESSOR TO SF 2133)
Passed Senate, Date Passed House, Date
Vote: Ayes Nays Vote: Ayes Nays
Approved
A BILL FOR
1 An Act relating to renewable energy including the renewable
2 energy tax credit and the wind energy production tax credit.
3 BE IT ENACTED BY THE GENERAL ASSEMBLY OF THE STATE OF IOWA:
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PAG LIN
1 1 Section 1. Section 476B.1, subsection 4, paragraph c, Code
1 2 Supplement 2005, is amended to read as follows:
1 3 c. Was originally placed in service on or after July 1,
1 4 2005, but before July 1, 2008 2009.
1 5 Sec. 2. Section 476B.5, subsection 1, paragraph e, Code
1 6 Supplement 2005, is amended to read as follows:
1 7 e. A copy of an executed power purchase agreement or other
1 8 agreement to purchase electricity upon completion of the
1 9 project. An executed interconnection agreement or
1 10 transmission service agreement shall be accepted by the board
1 11 under this paragraph if the owner of the facility has agreed
1 12 to sell electricity from the facility directly or indirectly
1 13 to a wholesale power pool market.
1 14 Sec. 3. Section 476B.5, subsection 3, Code Supplement
1 15 2005, is amended to read as follows:
1 16 3. A facility that is not operational within eighteen
1 17 months after issuance of an approval for the facility by the
1 18 board shall cease to be a qualified facility. However, a
1 19 facility that is approved as qualified under this section but
1 20 is not operational within eighteen months due to the
1 21 unavailability of necessary equipment shall be granted an
1 22 additional twelve months to become operational. A facility
1 23 that is granted and thereafter loses approval may reapply to
1 24 the board for a new determination.
1 25 Sec. 4. Section 476C.1, subsection 6, unnumbered paragraph
1 26 1, Code Supplement 2005, is amended to read as follows:
1 27 "Eligible renewable energy facility" means a wind energy
1 28 conversion facility, a biogas recovery facility, a biomass
1 29 conversion facility, a methane gas recovery facility, or a
1 30 solar energy conversion facility, or a refuse conversion
1 31 facility that meets all of the following requirements:
1 32 Sec. 5. Section 476C.1, subsection 6, paragraph d, Code
1 33 Supplement 2005, is amended to read as follows:
1 34 d. Was initially placed into service on or after July 1,
1 35 2005, and before January 1, 2011 2012.
2 1 Sec. 6. Section 476C.1, subsection 8, Code Supplement
2 2 2005, is amended to read as follows:
2 3 8. "Heat for a commercial purpose" means the heat in
2 4 British thermal unit equivalents from refuse derived fuel,
2 5 methane, or other biogas produced in this state sold to a
2 6 purchaser of renewable energy for use for a commercial purpose
2 7 in this state or for use by an institution in this state.
2 8 Sec. 7. Section 476C.1, Code Supplement 2005, is amended
2 9 by adding the following new subsection:
2 10 NEW SUBSECTION. 12A. "Refuse conversion facility" means a
2 11 facility in this state that converts solid waste into fuel
2 12 that can be burned to generate heat for a commercial purpose
2 13 in this state.
2 14 Sec. 8. Section 476C.3, subsections 2, 3, 4, and 5, Code
2 15 Supplement 2005, are amended to read as follows:
2 16 2. The board shall review the application and supporting
2 17 information and shall make a preliminary determination
2 18 regarding whether the facility is an eligible renewable energy
2 19 facility. The board shall notify the applicant of the
2 20 approval or denial of the application within thirty days of
2 21 receipt of the application and information required. If the
2 22 board fails to notify the applicant of the approval or denial
2 23 within thirty days, the application shall be deemed denied
2 24 unless the application is placed on a waiting list as
2 25 described in subsection 5. An applicant who receives a
2 26 determination denying an application may file an appeal with
2 27 the board within thirty days from the date of the denial
2 28 pursuant to the provisions of chapter 17A. In the absence of
2 29 a timely appeal, the preliminary determination shall be final.
2 30 If the application is incomplete, the board may grant an
2 31 extension of time for the provision of additional information.
2 32 3. A facility that is not operational within eighteen
2 33 thirty months after issuance of an approval for the facility
2 34 by the board shall cease to be an eligible renewable energy
2 35 facility. A facility that is granted and thereafter loses
3 1 approval may reapply to the board for a new determination.
3 2 4. The maximum amount of nameplate generating capacity of
3 3 all wind energy conversion facilities the board may find
3 4 eligible under this chapter shall not exceed ninety one
3 5 hundred eighty megawatts of nameplate generating capacity.
3 6 The maximum amount of energy production capacity equivalent of
3 7 all other facilities the board may find eligible under this
3 8 chapter shall not exceed a combined output of ten twenty
3 9 megawatts of nameplate generating capacity and one hundred
3 10 sixty=seven billion British thermal units of heat for a
3 11 commercial purpose. Of the maximum amount of energy
3 12 production capacity equivalent of all other facilities found
3 13 eligible under this chapter, fifty=five billion British
3 14 thermal units of heat for a commercial purpose shall be
3 15 reserved for an eligible facility that is a refuse conversion
3 16 facility for processed, engineered fuel from a multi=county
3 17 solid waste management planning area. The maximum amount of
3 18 energy production capacity the board may find eligible for a
3 19 single refuse conversion facility is fifty=five billion
3 20 British thermal units of heat for a commercial purpose.
3 21 5. The board shall maintain a waiting list of facilities
3 22 that may have been found eligible under this section but for
3 23 the maximum capacity restrictions of subsection 4. The
3 24 priority of the waiting list shall be maintained in the order
3 25 the applications were received by the board. The board shall
3 26 remove from the waiting list any facility that has
3 27 subsequently been found ineligible under this chapter. If
3 28 additional capacity becomes available within the capacity
3 29 restrictions of subsection 4, the board shall grant approval
3 30 to facilities according to the priority of the waiting list
3 31 before granting approval to new applications. An owner of a
3 32 facility on the waiting list shall provide the board each year
3 33 by August 31 with a sworn statement of verification stating
3 34 that the information contained in the application for
3 35 eligibility remains true and correct or stating that the
4 1 information has changed and providing the new information.
4 2 5. 6. An owner meeting the requirements of section
4 3 476C.1, subsection 6, paragraph "b", shall not be an owner of
4 4 more than two eligible renewable energy facilities. A person
4 5 that has an equity interest equal to or greater than fifty=one
4 6 percent in an eligible renewable energy facility shall not
4 7 have an equity interest greater than ten percent in any other
4 8 eligible renewable energy facility.
4 9 Sec. 9. Section 476C.5, Code Supplement 2005, is amended
4 10 to read as follows:
4 11 476C.5 CERTIFICATE ISSUANCE PERIOD.
4 12 A producer or purchaser of renewable energy may receive
4 13 renewable energy tax credit certificates for a ten=year period
4 14 for each eligible renewable energy facility under this
4 15 chapter. The ten=year period for issuance of the tax credit
4 16 certificates begins with the date the purchaser of renewable
4 17 energy first purchases electricity, hydrogen fuel, methane gas
4 18 or other biogas used to generate electricity, or heat for
4 19 commercial purposes from the eligible renewable energy
4 20 facility for which a tax credit is issued under this chapter.
4 21 Renewable energy tax credit certificates shall not be issued
4 22 for renewable energy purchased after December 31, 2020 2021.
4 23 Sec. 10. TRANSITION PROVISIONS == APPLICABILITY.
4 24 1. The waiting list described in this Act is the waiting
4 25 list maintained by the Iowa utilities board for applications
4 26 for eligibility received prior to the effective date of this
4 27 Act.
4 28 2. As of the effective date of this Act, the section of
4 29 this Act amending section 476C.3, subsection 6, applies to all
4 30 facilities on the waiting list described by this Act
4 31 regardless of the date a facility applied for eligibility.
4 32 Sec. 11. PROPOSAL FOR TRANSMISSION STUDY. The utilities
4 33 board shall submit to the government oversight committee by
4 34 January 1, 2007, a proposal to conduct a study on the
4 35 transmission of electricity in Iowa. The proposal shall
5 1 include a description of the content to be studied which shall
5 2 include examining the reliability and limitations of the
5 3 primary grid system and the development of additional small
5 4 wind projects in all regions of the state. The content to be
5 5 studied shall also include issues related to the security of
5 6 Iowa's energy supply in the event of a national or local
5 7 emergency affecting the primary grid system. The proposal
5 8 shall include a description of the estimated time needed to
5 9 complete the study, an estimate of the cost to complete the
5 10 study, and any other information the board deems necessary.
5 11 EXPLANATION
5 12 This bill relates to renewable energy including the
5 13 renewable energy tax credit and the wind energy production tax
5 14 credit.
5 15 The bill extends the eligibility of a qualified facility
5 16 for the wind energy production tax credit by one year to
5 17 include those wind energy conversion facilities that are
5 18 initially placed into service before July 1, 2009. The bill
5 19 permits an owner applying for a determination as to whether a
5 20 facility is qualified to provide an executed interconnection
5 21 agreement or transmissions service agreement instead of an
5 22 executed power purchase agreement or other agreement. The
5 23 bill provides that if a qualified facility is not operational
5 24 within 18 months, that the facility shall be granted an
5 25 additional 12 months to become operational if the delay is due
5 26 to the unavailability of necessary equipment.
5 27 The bill extends the eligibility of renewable energy
5 28 facilities for the renewable energy tax credit by one year to
5 29 include those facilities that are initially placed into
5 30 service before January 1, 2012. The bill extends the time by
5 31 which an eligible renewable energy facility must be
5 32 operational after approval of eligibility is granted from 18
5 33 months to 30 months.
5 34 The bill provides that an eligible renewable energy
5 35 facility includes a refuse conversion facility as defined by
6 1 the bill. The bill provides that "heat for a commercial
6 2 purpose" includes heat from refuse derived fuel and may be for
6 3 use by an institution.
6 4 The bill provides that the board may place an application
6 5 for a determination of whether a facility is an eligible
6 6 renewable energy facility on a waiting list if the facility
6 7 may have been found eligible but for the maximum capacity
6 8 requirements. The bill requires owners of facilities on the
6 9 waiting list to provide the board an annual verification of
6 10 the content of the application for eligibility. The bill
6 11 prohibits a person with an equity interest of 51 percent or
6 12 more in an eligible facility from owning more than 10 percent
6 13 in another eligible facility.
6 14 The bill allows additional tax credits for the production
6 15 of wind energy by increasing the maximum amount of nameplate
6 16 generating capacity that the board may find eligible for a
6 17 renewable energy tax credit from 90 megawatts to 180
6 18 megawatts. The bill similarly increases the maximum
6 19 eligibility for other nonwind renewable energy facilities from
6 20 10 megawatts to 20 megawatts of nameplate generating capacity
6 21 and provides for a maximum amount of 167 billion British
6 22 thermal units of heat for a commercial purpose to be found
6 23 eligible by the board. The bill provides that 55 billion
6 24 British thermal units shall be reserved for a refuse
6 25 conversion facility for processed, engineered fuel from a
6 26 multi=county solid waste management planning area. The board
6 27 shall not find eligible more than 55 billion British thermal
6 28 units for a single refuse conversion facility.
6 29 The bill extends the tax credit certificate issuance period
6 30 by one year to allow tax credits issued for facilities placed
6 31 into service before January 1, 2012, to have the same 10=year
6 32 period of eligibility to produce and sell renewable energy for
6 33 a renewable energy tax credit certificate as facilities are
6 34 allowed under current law.
6 35 The bill provides that the waiting list described in the
7 1 bill is the same waiting list maintained by the board for
7 2 applications received prior to the effective date of the bill.
7 3 The bill requires the board to conduct a study on the
7 4 transmission of electricity in this state.
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