House File 672 - Reprinted HOUSE FILE 672 BY COMMITTEE ON WAYS AND MEANS (SUCCESSOR TO HF 634) (SUCCESSOR TO HSB 201) (As Amended and Passed by the House April 18, 2011 ) A BILL FOR An Act relating to wind and other sources of renewable energy 1 development and production. 2 BE IT ENACTED BY THE GENERAL ASSEMBLY OF THE STATE OF IOWA: 3 HF 672 (5) 84 rn/nh/mb

H.F. 672 Section 1. Section 476B.5, subsection 4, Code 2011, is 1 amended to read as follows: 2 4. The maximum amount of nameplate generating capacity of 3 all qualified facilities the board may find eligible under this 4 chapter shall not exceed one hundred fifty twenty-six megawatts 5 of nameplate generating capacity. 6 Sec. 2. Section 476C.1, subsection 6, paragraph d, Code 7 2011, is amended to read as follows: 8 d. Was initially placed into service on or after July 1, 9 2005, and before January 1, 2012 2015 . 10 Sec. 3. Section 476C.1, subsection 6, Code 2011, is amended 11 by adding the following new paragraphs: 12 NEW PARAGRAPH . e. For applications filed on or after July 13 1, 2011, is a facility of not less than three-fourths megawatts 14 of nameplate generating capacity or the energy production 15 capacity equivalent if all or a portion of the renewable energy 16 produced is for on-site consumption by the producer. 17 NEW PARAGRAPH . f. For applications filed on or after 18 July 1, 2011, except for wind energy conversion facilities, 19 is a facility of no greater than five megawatts of nameplate 20 generating capacity or the energy production capacity 21 equivalent. 22 Sec. 4. Section 476C.1, subsection 8, Code 2011, is amended 23 to read as follows: 24 8. “Heat for a commercial purpose” means the heat in British 25 thermal unit equivalents from refuse-derived fuel, methane, or 26 other biogas produced in this state either for commercial use 27 by a producer for on-site consumption or sold to a purchaser of 28 renewable energy for use for a commercial purpose in this state 29 or for use by an institution in this state. 30 Sec. 5. Section 476C.2, subsection 1, Code 2011, is amended 31 to read as follows: 32 1. A producer or purchaser of renewable energy may 33 receive renewable energy tax credits under this chapter in 34 an amount equal to one and one-half cents per kilowatt-hour 35 -1- HF 672 (5) 84 rn/nh/mb 1/ 6

H.F. 672 of electricity, or four dollars and fifty cents per million 1 British thermal units of heat for a commercial purpose, or 2 four dollars and fifty cents per million British thermal units 3 of methane gas or other biogas used to generate electricity, 4 or one dollar and forty-four cents per one thousand standard 5 cubic feet of hydrogen fuel generated by and purchased from 6 an eligible renewable energy facility or used for on-site 7 consumption by the producer . 8 Sec. 6. Section 476C.3, subsection 1, paragraph e, Code 9 2011, is amended to read as follows: 10 e. A Except when the renewable energy is produced for 11 on-site consumption by the producer, a copy of the power 12 purchase agreement or other agreement to purchase electricity, 13 hydrogen fuel, methane or other biogas, or heat for a 14 commercial purpose which shall designate either the producer 15 or purchaser of renewable energy as eligible to apply for the 16 renewable energy tax credit. 17 Sec. 7. Section 476C.3, subsection 3, Code 2011, is amended 18 to read as follows: 19 3. a. A facility that is not operational within thirty 20 months after issuance of an approval for the facility by 21 the board shall cease to be an eligible renewable energy 22 facility. However, a wind energy conversion facility that is 23 approved as eligible under this section but is not operational 24 within eighteen months due to the unavailability of necessary 25 equipment shall be granted an additional twenty-four months to 26 become operational. 27 b. A facility which notifies the board prior to the 28 expiration of the time periods specified in paragraph “a” 29 that the facility intends to become operational and wishes 30 to preserve its eligibility shall be granted a twelve-month 31 extension. An extension may be renewed for succeeding 32 twelve-month periods if the board is notified prior to the 33 expiration of the extension of the continued intention to 34 become operational during the succeeding period of extension. 35 -2- HF 672 (5) 84 rn/nh/mb 2/ 6

H.F. 672 c. If the owner of a facility discontinues efforts to 1 achieve operational status, the owner shall notify the board 2 within thirty days of such discontinuance that the owner no 3 longer seeks a tax credit pursuant to this chapter. Upon 4 receipt of such notification, the board shall no longer 5 consider the facility as an eligible renewable energy facility 6 under this chapter. 7 d. A facility that is granted and thereafter loses approval 8 may reapply to the board for a new determination. 9 Sec. 8. Section 476C.3, subsection 4, Code 2011, is amended 10 to read as follows: 11 4. a. The maximum amount of nameplate generating capacity 12 of all wind energy conversion facilities the board may find 13 eligible under this chapter shall not exceed three hundred 14 thirty sixty-three megawatts of nameplate generating capacity. 15 b. The maximum amount of energy production capacity 16 equivalent of all other facilities the board may find eligible 17 under this chapter shall not exceed a combined output of 18 twenty sixty-nine megawatts of nameplate generating capacity 19 and one hundred sixty-seven billion British thermal units 20 of heat for a commercial purpose. Of the maximum amount of 21 energy production capacity equivalent of all other facilities 22 found eligible under this chapter , fifty-five billion British 23 thermal units of heat for a commercial purpose shall be 24 reserved for an eligible facility that is a refuse conversion 25 facility for processed, engineered fuel from a multicounty 26 solid waste management planning area. The maximum amount of 27 energy production capacity the board may find eligible for 28 a single refuse conversion facility is fifty-five billion 29 British thermal units of heat for a commercial purpose. Of 30 the maximum amount of energy production capacity equivalent 31 of all other facilities found eligible under this chapter, 32 an amount equivalent to sixteen megawatts of nameplate 33 generating capacity shall be reserved for eligible renewable 34 energy facilities incorporated within or associated with an 35 -3- HF 672 (5) 84 rn/nh/mb 3/ 6

H.F. 672 ethanol cogeneration plant, provided such a facility becomes 1 operational on or before July 1, 2016. Notwithstanding 2 subsection 3, in the event such a facility does not become 3 operational on or before July 1, 2016, the sixteen megawatts 4 of nameplate generating capacity reserved for such facilities 5 shall cease to be reserved. 6 Sec. 9. Section 476C.4, subsections 1 and 2, Code 2011, are 7 amended to read as follows: 8 1. A producer or purchaser of renewable energy may apply to 9 the board for the renewable energy tax credit by submitting to 10 the board all of the following: 11 a. A completed application in a form prescribed by the 12 board. 13 b. A copy of the determination granting approval of the 14 facility as an eligible renewable energy facility by the board. 15 c. A copy of a signed power purchase agreement or other 16 agreement to purchase electricity, hydrogen fuel, methane or 17 other biogas, or heat for a commercial purpose from an eligible 18 renewable energy facility which shall designate either the 19 producer or purchaser of renewable energy as eligible to apply 20 for the renewable energy tax credit. 21 d. Sufficient documentation that the electricity, heat for 22 a commercial purpose, methane gas or other biogas, or hydrogen 23 fuel has been generated by the eligible renewable energy 24 facility and sold to the purchaser of renewable energy. 25 e. To the extent the produced electricity, hydrogen fuel, 26 methane or other biogas, or heat for a commercial purpose is 27 used for on-site consumption, the requirements of paragraphs 28 “c” and “d” shall not be applicable. For such renewable energy 29 production, the owner must submit a certification under penalty 30 of perjury that the claimed amount of electricity, hydrogen 31 fuel, methane or other biogas, or heat for a commercial purpose 32 was produced by the eligible facility and consumed by the 33 owner. 34 e. f. Any other information the board deems necessary. 35 -4- HF 672 (5) 84 rn/nh/mb 4/ 6

H.F. 672 2. The board shall notify the department of the amount 1 of kilowatt-hours, British thermal units of heat for a 2 commercial purpose, British thermal units of methane gas or 3 other biogas used to generate electricity, or standard cubic 4 feet of hydrogen fuel generated and purchased from an eligible 5 renewable energy facility or generated and used by the producer 6 for on-site consumption . The department shall calculate the 7 amount of the tax credit for which the applicant is eligible 8 and shall issue the tax credit certificate for that amount or 9 notify the applicant in writing of its refusal to do so. An 10 applicant whose application is denied may file an appeal with 11 the department within sixty days from the date of the denial 12 pursuant to the provisions of chapter 17A . 13 Sec. 10. Section 476C.4, subsection 5, Code 2011, is amended 14 to read as follows: 15 5. The department shall not issue a tax credit certificate 16 if the facility approved by the board as an eligible renewable 17 energy facility is not operational within eighteen months after 18 the approval is issued , subject to the extension provisions of 19 section 476C.3, subsection 3 . 20 Sec. 11. Section 476C.5, Code 2011, is amended to read as 21 follows: 22 476C.5 Certificate issuance period. 23 A producer or purchaser of renewable energy may receive 24 renewable energy tax credit certificates for a ten-year period 25 for each eligible renewable energy facility under this chapter . 26 The ten-year period for issuance of the tax credit certificates 27 begins with the date the purchaser of renewable energy first 28 purchases electricity, hydrogen fuel, methane gas or other 29 biogas used to generate electricity, or heat for commercial 30 purposes from the eligible renewable energy facility for 31 which a tax credit is issued under this chapter , or the date 32 the producer of the renewable energy first uses the energy 33 produced by the eligible renewable energy facility for on-site 34 consumption . Renewable energy tax credit certificates shall 35 -5- HF 672 (5) 84 rn/nh/mb 5/ 6

H.F. 672 not be issued for renewable energy purchased or produced for 1 on-site consumption after December 31, 2021 2024 . 2 -6- HF 672 (5) 84 rn/nh/mb 6/ 6