S. 426Senate109th Congress (2005-2007)In Committee

Electric Reliability Security Act of 2005

Introduced February 17, 2005

Legislative Activity

Stay on top of the latest movement without scrolling through every action

2 earlier actions
SenateIntro Referral Latest Action

Read twice and referred to the Committee on Energy and Natural Resources. (text of measure as introduced: CR S1635-1641)

February 17, 2005

View full timeline
SenateIntro Referral

Introduced in Senate

February 17, 2005

SenateIntro Referral

Sponsor introductory remarks on measure. (CR S1635)

February 17, 2005

SenateIntro Referral

Read twice and referred to the Committee on Energy and Natural Resources. (text of measure as introduced: CR S1635-1641)

February 17, 2005

Floor Debate

22 members

What members said about S. 426 on the floor

11 Republicans10 Democrats1 Independent
Byron L. Dorgan
Sen. Byron L. DorganD-ND · Jun 28, 2005

Mr. President, those amendments have all been cleared by both sides. I have no objection. Mr. President, I suggest the absence of a quorum. Mr. President, we are on the Interior appropriations bill,…

James M. Jeffords
Sen. James M. JeffordsI-VT · Feb 17, 2005

Mr. President, today I am introducing comprehensive legislation to ensure the reliable delivery of electric power in the United States. Last Congress, in August of 2003, nearly 50 million people in…

Lisa Murkowski
Sen. Lisa MurkowskiR-AK · Feb 17, 2005

Mr. President, this week the people of my State of Alaska pause to recognize two giant figures in the fight for equal rights and justice under the law, the late Elizabeth and Roy Peratrovich. On…

Daniel K. Akaka
Sen. Daniel K. AkakaD-HI · Feb 17, 2005

Mr. President, in the shadow of crude oil prices that have reached nearly $50 per barrel, and with the specter of higher gasoline prices forecast by the Department of Energy's Energy Information…

Christopher S. Bond
Sen. Christopher S. BondR-MO · Feb 17, 2005

Mr. President, I rise today to join with my colleague Senator McConnell in introducing the Voter Protection Act of 2005. This legislation builds upon the progress made by the Help America Vote Act…

Show 8 more
Jon Kyl
Sen. Jon KylR-AZ · Feb 17, 2005

Mr. President, today I am introducing legislation to make the 15-year depreciation recovery period for improvements to restaurants permanent, and to extend this treatment to cover new restaurant…

George Allen
Sen. George AllenR-VA · Feb 17, 2005

Mr. President, today, with my colleagues, Senators Talent, Graham, McCain, Lott, Warner, Grassley and Thune, I rise to introduce the Minority Serving Institution Digital & Wireless Technology…

Herb Kohl
Sen. Herb KohlD-WI · Feb 17, 2005

Mr. President, I rise today to join Senator Lott in introducing legislation which is of great importance to millions of people throughout the country. The sport fishing and boating communities play a…

Mike DeWine
Sen. Mike DeWineR-OH · Feb 17, 2005

Mr. President, I rise today along with my colleague, Senator Durbin, to introduce the Presidential Sites Improvement Act of 2005. As we look forward to celebrating President's Day this coming Monday,…

Russell D. Feingold
Sen. Russell D. FeingoldD-WI · Feb 17, 2005

Mr. President, today I am introducing the third in a series of bills intended to support American companies and American workers. Earlier this week, I introduced S. Con. Res. 12, which would set some…

Gordon H. Smith
Sen. Gordon H. SmithR-OR · Feb 17, 2005

Mr. President, I am pleased to be joined today by my colleagues, Senators Kohl, Lugar, Lieberman, Brownback, Clinton, Lautenberg, and Feingold, to introduce this important piece of legislation.…

Norm Coleman
Sen. Norm ColemanR-MN · Feb 17, 2005

Mr. President, today I am introducing legislation to reverse the decline in the number of international students studying at American colleges, universities, and high schools. I am very pleased to be…

James M. Jeffords
Sen. James M. JeffordsI-VT · Feb 17, 2005

Mr. President, today I am introducing comprehensive legislation to ensure the reliable delivery of electric power in the United States. Last Congress, in August of 2003, nearly 50 million people in…

Show 11 more
John Warner
Sen. John WarnerR-VA · Jun 28, 2005

Mr. President, I ask unanimous consent that the order for the quorum call be rescinded. It is my understanding of the parliamentary situation that an amendment by the distinguished Senator from West…

Barbara Boxer
Sen. Barbara BoxerD-CA · Feb 17, 2005

Mr. President, today I am introducing legislation to protect public health and the environment by preventing chemicals from leaking out of underground storage tanks and thereafter contaminating…

Jeff Bingaman
Sen. Jeff BingamanD-NM · Feb 17, 2005

Mr. President, I rise today, along with Senator Coleman, to introduce the American Competitiveness Through International Openness Now (``ACTION'') Act of 2005. A few days ago, I came to the Senate…

Jon S. Corzine
Sen. Jon S. CorzineD-NJ · Feb 17, 2005

Mr. President, I rise today to offer legislation that would designate New Jersey's elite urban search and rescue team, New Jersey Task Force One, as part of the National Urban Search and Rescue…

Byron L. Dorgan
Sen. Byron L. DorganD-ND · Feb 17, 2005

Mr. President, I rise today to introduce legislation, along with Senator Shelby, to provide a financial safety net for the families of our young men and women who proudly serve in the Nation's…

Mitch McConnell
Sen. Mitch McConnellR-KY · Feb 17, 2005

Mr. President, I rise today to introduce the Voter Protection Act of 2005, and I am pleased to be joined again by my good friend from Missouri, Senator Bond. I also acknowledge the deep interest and…

John D. Rockefeller IV
Sen. John D. Rockefeller IVD-WV · Feb 17, 2005

Mr. President, I am pleased to introduce legislation today know as the State Child Well-Being Research Act of 2005. This bill is designed to enhance child well-being in every State by collecting data…

Richard C. Shelby
Sen. Richard C. ShelbyR-AL · Feb 17, 2005

Mr. President, I rise today to introduce legislation with Senator Dorgan to provide a financial safety net for the families of our servicemembers who proudly serve in our Nation's military Reserve…

Robert C. Byrd
Sen. Robert C. ByrdD-WV · Jun 28, 2005

Mr. President, I ask for the regular order regarding amendment No. 1053. I thank the Chair. Mr. President, I have no remarks at the moment. If the Senator who stands in front of me, with his hand…

Michael B. Enzi
Sen. Michael B. EnziR-WY · Feb 17, 2005

Mr. President, I rise today with my colleague from New York to introduce the Military Personnel Financial Services Protection Act of 2005. This bill is needed to protect our military personnel and…

Paul S. Sarbanes
Sen. Paul S. SarbanesD-MD · Jun 28, 2005

Mr. President, I am very pleased to join in cosponsoring this amendment. I thank the Chairman and the ranking member of the Appropriations Committee for bringing this amendment forward. It is an…

Bill Text

Latest available legislative text

Reading Mode
Latest
Introduced in SenateIssued February 17, 2005
        [Congressional Bills 109th Congress]
[From the U.S. Government Publishing Office]
[S. 426 Introduced in Senate (IS)]

109th CONGRESS
1st Session
S. 426

To enhance national security by improving the reliability of the United
States electricity transmission grid, to ensure efficient, reliable and
affordable energy to American consumers, and for other purposes.

_______________________________________________________________________

IN THE SENATE OF THE UNITED STATES

February 17, 2005

Mr. Jeffords (for himself, Ms. Cantwell, and Mr. Kennedy) introduced
the following bill; which was read twice and referred to the Committee
on Energy and Natural Resources

_______________________________________________________________________

A BILL

To enhance national security by improving the reliability of the United
States electricity transmission grid, to ensure efficient, reliable and
affordable energy to American consumers, and for other purposes.

Be it enacted by the Senate and House of Representatives of the
United States of America in Congress assembled,

SECTION 1. SHORT TITLE; TABLE OF CONTENTS.

(a) Short Title.--This Act may be cited as the ``Electric
Reliability Security Act of 2005''.
(b) Table of Contents.--The table of contents of this Act is as
follows:

Sec. 1. Short title; table of contents.
TITLE I--RELIABILITY

Sec. 101. Electric reliability standards.
Sec. 102. Model electric utility workers code.
Sec. 103. Electricity outage investigation.
Sec. 104. Study on reliability of United States energy grid.
TITLE II--EFFICIENCY

Sec. 201. System benefits fund.
Sec. 202. Electricity efficiency performance standard.
Sec. 203. Appliance efficiency.
Sec. 204. Loan guarantees.
TITLE III--ONSITE GENERATION

Sec. 301. Net metering.
Sec. 302. Interconnection.
Sec. 303. Onsite generation for emergency facilities.

TITLE I--RELIABILITY

SEC. 101. ELECTRIC RELIABILITY STANDARDS.

(a) In General.--Part II of the Federal Power Act (16 U.S.C 824 et
seq.) is amended by adding at the end the following:

``SEC. 215. ELECTRIC RELIABILITY.

``(a) Definitions.--In this section:
``(1)(A) The term `bulk-power system' means--
``(i) facilities and control systems necessary for
operating an interconnected electric energy
transmission network (or any portion thereof); and
``(ii) electric energy from generation facilities
needed to maintain transmission system reliability.
``(B) The term `bulk-power system' does not include
facilities used in the local distribution of electric energy.
``(2) The terms `Electric Reliability Organization' and
`ERO' mean the organization certified by the Commission under
subsection (c) the purpose of which is to establish and enforce
reliability standards for the bulk-power system, subject to
Commission review.
``(3) The term `interconnection' means a geographic area in
which the operation of bulk-power system components is
synchronized such that the failure of 1 or more of such
components may adversely affect the ability of the operators of
other components within the system to maintain reliable
operation of the facilities within their control.
``(4) The term `regional entity' means an entity having
enforcement authority pursuant to subsection (e)(4).
``(5)(A) The term `reliability standard' means a
requirement, approved by the Commission under this section, to
provide for reliable operation of the bulk-power system.
``(B) The term `reliability standard' includes requirements
for the operation of existing bulk-power system facilities and
the design of planned additions or modifications to those
facilities to the extent necessary to provide for reliable
operation of the bulk-power system.
``(C) The term `reliability standard' does not include any
requirement to enlarge a facility described in subparagraph (B)
or to construct new transmission capacity or generation
capacity.
``(6) The term `reliable operation' means operating the
elements of the bulk-power system within equipment and electric
system thermal, voltage, and stability limits so that
instability, uncontrolled separation, or cascading failures of
such system will not occur as a result of a sudden disturbance
or unanticipated failure of system elements.
``(7) The term `transmission organization' means a regional
transmission organization, independent system operator,
independent transmission provider, or other transmission
organization finally approved by the Commission for the
operation of transmission facilities.
``(b) Jurisdiction and Applicability.--(1)(A) The Commission shall
have jurisdiction, within the United States, over the ERO certified by
the Commission under subsection (c), any regional entities, and all
users, owners and operators of the bulk-power system, including the
entities described in section 201(f), for purposes of approving
reliability standards established under this section and enforcing
compliance with this section.
``(B) All users, owners, and operators of the bulk-power system
shall comply with reliability standards that take effect under this
section.
``(2) Not later than 180 days after the date of enactment of this
section, the Commission shall issue a final rule to implement this
section.
``(c) Certification.--(1) Following the issuance of a Commission
rule under subsection (b)(2), any person may submit an application to
the Commission for certification as the Electric Reliability
Organization.
``(2) The Commission may certify an ERO described in paragraph (1)
if the Commission determines that the ERO--
``(A) has the ability to develop and enforce, subject to
subsection (e)(2), reliability standards that provide for an
adequate level of reliability of the bulk-power system; and
``(B) has established rules that--
``(i) ensure the independence of the ERO from the
users and owners and operators of the bulk-power
system, while ensuring fair stakeholder representation
in the selection of directors of the ERO and balanced
decisionmaking in any ERO committee or subordinate
organizational structure;
``(ii) allocate equitably reasonable dues, fees,
and other charges among end users for all activities
under this section;
``(iii) provide fair and impartial procedures for
enforcement of reliability standards through the
imposition of penalties in accordance with subsection
(e) (including limitations on activities, functions, or
operations, or other appropriate sanctions);
``(iv) provide for reasonable notice and
opportunity for public comment, due process, openness,
and balance of interests in developing reliability
standards and otherwise exercising the duties of the
ERO; and
``(v) provide for taking, after certification,
appropriate steps to gain recognition in Canada and
Mexico.
``(d) Reliability Standards.--(1) The Electric Reliability
Organization shall file each reliability standard or modification to a
reliability standard that the Electric Reliability Organization
proposes to be made effective under this section with the Commission.
``(2)(A) The Commission may approve, by rule or order, a proposed
reliability standard or modification to a reliability standard if the
Commission determines that the standard is just, reasonable, not unduly
discriminatory or preferential, and in the public interest.
``(B) The Commission--
``(i) shall give due weight to the technical expertise of
the Electric Reliability Organization with respect to the
content of a proposed standard or modification to a reliability
standard and to the technical expertise of a regional entity
organized on an interconnection-wide basis with respect to a
reliability standard to be applicable within that
interconnection; but
``(ii) shall not defer with respect to the effect of a
standard on competition.
``(C) A proposed standard or modification shall take effect upon
approval by the Commission.
``(3) The Electric Reliability Organization shall rebuttably
presume that a proposal from a regional entity organized on an
interconnection-wide basis for a reliability standard or modification
to a reliability standard to be applicable on an interconnection-wide
basis is just, reasonable, and not unduly discriminatory or
preferential, and in the public interest.
``(4) The Commission shall remand to the Electric Reliability
Organization for further consideration a proposed reliability standard
or a modification to a reliability standard that the Commission
disapproves in whole or in part.
``(5) The Commission, upon a motion of the Commission or upon
complaint, may order the Electric Reliability Organization to submit to
the Commission a proposed reliability standard or a modification to a
reliability standard that addresses a specific matter if the Commission
considers such a new or modified reliability standard appropriate to
carry out this section.
``(6)(A) The final rule adopted under subsection (b)(2) shall
include fair processes for the identification and timely resolution of
any conflict between a reliability standard and any function, rule,
order, tariff, rate schedule, or agreement accepted, approved, or
ordered by the Commission applicable to a transmission organization.
``(B) The transmission organization shall continue to comply with
such function, rule, order, tariff, rate schedule, or agreement as is
accepted, approved, or ordered by the Commission until--
``(i) the Commission finds a conflict exists between a
reliability standard and any such provision;
``(ii) the Commission orders a change to the provision
pursuant to section 206; and
``(iii) the ordered change becomes effective under this
part.
``(C) If the Commission determines that a reliability standard
needs to be changed as a result of such a conflict, the Commission
shall order the ERO to develop and file with the Commission a modified
reliability standard under paragraph (4) or (5).
``(e) Enforcement.--(1) Subject to paragraph (2), the ERO may
impose a penalty on a user or owner or operator of the bulk-power
system for a violation of a reliability standard approved by the
Commission under subsection (d) if the ERO, after notice and an
opportunity for a hearing--
``(A) finds that the user or owner or operator has violated
a reliability standard approved by the Commission under
subsection (d); and
``(B) files notice and the record of the proceeding with
the Commission.
``(2)(A) A penalty imposed under paragraph (1) may take effect not
earlier than the 31st day after the date on which the ERO files with
the Commission notice of the penalty and the record of proceedings.
``(B) The penalty shall be subject to review by the Commission
upon--
``(i) a motion by the Commission; or
``(ii) application by the user, owner, or operator that is
the subject of the penalty filed not later than 30 days after
the date on which the notice is filed with the Commission.
``(C) Application to the Commission for review, or the initiation
of review by the Commission upon a motion of the Commission, shall not
operate as a stay of the penalty unless the Commission orders otherwise
upon a motion of the Commission or upon application by the user, owner,
or operator that is the subject of the penalty.
``(D) In any proceeding to review a penalty imposed under paragraph
(1), the Commission, after notice and opportunity for hearing (which
hearing may consist solely of the record before the ERO and opportunity
for the presentation of supporting reasons to affirm, modify, or set
aside the penalty), shall by order affirm, set aside, reinstate, or
modify the penalty, and, if appropriate, remand to the ERO for further
proceedings.
``(E) The Commission shall implement expedited procedures for
hearings described in subparagraph (D).
``(3) Upon a motion of the Commission or upon complaint, the
Commission may order compliance with a reliability standard and may
impose a penalty against a user or owner or operator of the bulk-power
system if the Commission finds, after notice and opportunity for a
hearing, that the user or owner or operator of the bulk-power system
has engaged or is about to engage in any act or practice that
constitutes or will constitute a violation of a reliability standard.
``(4)(A) The Commission shall issue regulations authorizing the ERO
to enter into an agreement to delegate authority to a regional entity
for the purpose of proposing reliability standards to the ERO and
enforcing reliability standards under paragraph (1) if--
``(i) the regional entity is governed by an independent
board, a balanced stakeholder board, or a combination of an
independent and balanced stakeholder board;
``(ii) the regional entity otherwise meets the requirements
of paragraphs (1) and (2) of subsection (c); and
``(iii) the agreement promotes effective and efficient
administration of bulk-power system reliability.
``(B) The Commission may modify a delegation under this paragraph.
``(C) The ERO and the Commission shall rebuttably presume that a
proposal for delegation to a regional entity organized on an
interconnection-wide basis promotes effective and efficient
administration of bulk-power system reliability and should be approved.
``(D) The regulations issued under this paragraph may provide that
the Commission may assign the authority of the ERO to enforce
reliability standards under paragraph (1) directly to a regional entity
in accordance with this paragraph.
``(5) The Commission may take such action as the Commission
determines to be appropriate against the ERO or a regional entity to
ensure compliance with a reliability standard or any Commission order
affecting the ERO or a regional entity.
``(6) Any penalty imposed under this section shall bear a
reasonable relation to the seriousness of the violation and shall take
into consideration the efforts of the user, owner, or operator to
remedy the violation in a timely manner.
``(f) Changes in Electric Reliability Organization Rules.--(1) The
Electric Reliability Organization shall file with the Commission for
approval any proposed rule or proposed rule change, accompanied by an
explanation of the basis and purpose of the rule and proposed rule
change.
``(2) The Commission, upon a motion of the Commission or upon
complaint, may propose a change to the rules of the ERO.
``(3) A proposed rule or proposed rule change shall take effect
upon a finding by the Commission, after notice and opportunity for
comment, that the change is just, reasonable, not unduly discriminatory
or preferential, is in the public interest, and meets the requirements
of subsection (c).
``(g) Reliability Reports.--The ERO shall conduct periodic
assessments of the reliability and adequacy of the bulk-power system in
North America.
``(h) Coordination With Canada and Mexico.--The President is urged
to negotiate international agreements with the governments of Canada
and Mexico to provide for effective compliance with reliability
standards and the effectiveness of the ERO in the United States and
Canada or Mexico.
``(i) Savings Provisions.--(1) The ERO may develop and enforce
compliance with reliability standards for only the bulk-power system.
``(2) Nothing in this section authorizes the ERO or the Commission
to order the construction of additional generation or transmission
capacity or to set and enforce compliance with standards for adequacy
or safety of electric facilities or services.
``(3) Nothing in this section preempts any authority of any State
to take action to ensure the safety, adequacy, and reliability of
electric service within that State, as long as such action is not
inconsistent with any reliability standard.
``(4) Not later than 90 days after the date of application of the
Electric Reliability Organization or other affected party, and after
notice and opportunity for comment, the Commission shall issue a final
order determining whether a State action is inconsistent with a
reliability standard, taking into consideration any recommendation of
the ERO.
``(5) The Commission, after consultation with the ERO and the State
taking action, may stay the effectiveness of any State action, pending
the issuance by the Commission of a final order.
``(j) Regional Advisory Bodies.--(1) The Commission shall establish
a regional advisory body on the petition of at least \2/3\ of the
States within a region that have more than \1/2\ of the electric load
of the States served within the region.
``(2) A regional advisory body--
``(A) shall be composed of 1 member from each participating
State in the region, appointed by the Governor of the State;
and
``(B) may include representatives of agencies, States, and
provinces outside the United States.
``(3) A regional advisory body may provide advice to the Electric
Reliability Organization, a regional entity, or the Commission
regarding--
``(A) the governance of an existing or proposed regional
entity within the same region;
``(B) whether a standard proposed to apply within the
region is just, reasonable, not unduly discriminatory or
preferential, and in the public interest;
``(C) whether fees proposed to be assessed within the
region are just, reasonable, not unduly discriminatory or
preferential, and in the public interest; and
``(D) any other responsibilities requested by the
Commission.
``(4) The Commission may give deference to the advice of a regional
advisory body if that body is organized on an interconnection-wide
basis.
``(k) Alaska and Hawaii.--This section does not apply to Alaska or
Hawaii.''.
(b) Status of ERO.--The Electric Reliability Organization certified
by the Federal Energy Regulatory Commission under section 215(c) of the
Federal Power Act (as added by subsection (a)) and any regional entity
delegated enforcement authority pursuant to section 215(e)(4) of that
Act (as so added) are not departments, agencies, or instrumentalities
of the United States Government.

SEC. 102. MODEL ELECTRIC UTILITY WORKERS CODE.

Subtitle B of title I of the Public Utility Regulatory Policies Act
of 1978 (16 U.S.C. 2621 et seq.) is amended by adding at the end the
following:

``SEC. 118. MODEL CODE FOR ELECTRIC UTILITY WORKERS.

``(a) In General.--The Secretary shall develop by rule and
circulate among the States for their consideration a model code
containing standards for electric facility workers to ensure electric
facility safety and reliability.
``(b) Consultation.--In developing the standards, the Secretary
shall consult with all interested parties, including representatives of
electric facility workers.
``(c) Not Affecting Occupational Safety and Health.--In issuing a
model code under this section, the Secretary shall not, for purposes of
section 4 of the Occupational Safety and Health Act of 1970 (29 U.S.C.
653), be deemed to be exercising statutory authority to prescribe or
enforce standards or regulations affecting occupational safety and
health.''.

SEC. 103. ELECTRICITY OUTAGE INVESTIGATION.

Part III of the Federal Power Act (16 U.S.C. 824) is amended--
(1) by redesignating sections 320 and 321 (16 U.S.C. 825r,
791a) as sections 321 and 322, respectively; and
(2) by inserting after section 319 (16 U.S.C. 825q) the
following:

``SEC. 320. ELECTRICITY OUTAGE INVESTIGATION BOARD.

``(a) Establishment.--There is established an Electricity Outage
Investigation Board that shall be an independent establishment within
the executive branch.
``(b) Membership.--(1) The Board shall consist of 7 members and
shall include--
``(A) the Secretary of Energy (or a designee);
``(B) the Chairperson of the Federal Energy Regulatory
Commission (or a designee);
``(C) a representative of the National Academy of Sciences
appointed by the President;
``(D) a representative nominated by the majority leader of
the Senate and appointed by the President;
``(E) a representative nominated by the minority leader of
the Senate and appointed by the President;
``(F) a representative nominated by the majority leader of
the House of Representatives and appointed by the President;
and
``(G) a representative nominated by the minority leader of
the House of Representatives and appointed by the President.
``(2) Each member of the Board shall demonstrate relevant expertise
in the field of electricity generation, transmission, and distribution,
and such other expertise as will best assist in carrying out the duties
of the Board.
``(c) Terms.--(1) Except as provided in paragraph (2), each member
of the Board shall serve for a term of 3 years.
``(2) The Secretary of Energy and the Chairperson of the Federal
Energy Regulatory Commission shall be permanent members of the Board.
``(d) Duties.--The Board shall--
``(1) upon request by Congress or the President,
investigate a major bulk-power system failure in the United
States to determine the causes of the failure;
``(2) report expeditiously to Congress and the President
the results of the investigation; and
``(3) recommend to Congress and the President actions to
minimize the possibility of future bulk-power system failure.
``(e) Compensation.--(1) Each member of the Board shall be paid at
the rate payable for level III of the Executive Schedule for each day
(including travel time) the member is engaged in the work of the Board.
``(2) Each member of the Board may receive travel expenses,
including per diem in lieu of subsistence, in the same manner as is
permitted under sections 5702 and 5703 of title 5, United States
Code.''.

SEC. 104. STUDY ON RELIABILITY OF UNITED STATES ELECTRICITY GRID.

(a) Study on Reliability.--Not later than 45 days after the date of
enactment of this Act, the Secretary of Energy shall enter into a
contract with the National Academy of Sciences under which the Academy
shall conduct a study on the reliability of the United States
electricity grid to examine the effectiveness of the current United
States electricity transmission and distribution system at providing
efficient, secure, and affordable power to United States consumers.
(b) Contents.--The study shall include an analysis of--
(1) the vulnerability of the transmission and distribution
system to disruption by natural, mechanical or human causes
including sabotage;
(2) the most efficient and cost-effective solutions for
dealing with vulnerabilities or other problems of the
electricity transmission and distribution system of the United
States, including a comparison of investments in--
(A) efficiency;
(B) distributed generation;
(C) technical advances in software and other
devices to improve the efficiency and reliability of
the grid;
(D) new power line construction; and
(E) any other relevant matters.
(c) Report.--The contract shall provide that, not later than 180
days after the date of execution of the contract, the National Academy
of Sciences shall submit to the President and Congress a report that
details the findings and recommendations of the study.

TITLE II--EFFICIENCY

SEC. 201. SYSTEM BENEFITS FUND.

(a) Definitions.--In this section:
(1) Administrator.--The term ``Administrator'' means the
Administrator of the Environmental Protection Agency.
(2) Board.--The term ``Board'' means the System Benefits
Trust Fund Board established under subsection (b).
(3) Commission.--The term ``Commission'' means the Federal
Energy Regulatory Commission.
(4) Farm system.--The term ``farm system'' means an
electric generating facility that generates electric energy
from the anaerobic digestion of agricultural waste produced by
farming that is located on the farm where substantially all of
the waste used is produced.
(5) Fund.--The term ``Fund'' means the System Benefits
Trust Fund established under subsection (c).
(6) Renewable Energy.--The term ``renewable energy'' means
electricity generated from wind, ocean energy, organic waste
(excluding incinerated municipal solid waste), biomass
(including anaerobic digestion from farm systems and landfill
gas recovery) or a geothermal, solar thermal, or photovoltaic
source.
(7) Secretary.--The term ``Secretary'' means the Secretary
of Energy.
(b) Board.--
(1) Establishment.--The Secretary shall establish a System
Benefits Trust Fund Board to carry out the functions and
responsibilities described in this section.
(2) Membership.--The Board shall be composed of--
(A) 1 representative of the Federal Energy
Regulatory Commission appointed by the Federal Energy
Regulatory Commission;
(B) 2 representatives of the Secretary of Energy
appointed by the Secretary;
(C) 2 persons nominated by the National Association
of Regulatory Utility Commissioners and appointed by
the Secretary;
(D) 1 person nominated by the National Association
of State Utility Consumer Advocates and appointed by
the Secretary;
(E) 1 person nominated by the National Association
of State Energy Officials and appointed by the
Secretary;
(F) 1 person nominated by the National Energy
Assistance Directors' Association and appointed by the
Secretary; and
(G) 1 representative of the Environmental
Protection Agency appointed by the Administrator.
(3) Chairperson.--The Secretary shall select a member of
the Board to serve as Chairperson of the Board.
(c) Establishment of Fund.--
(1) In general.--The Board shall establish an account or
accounts at 1 or more financial institutions, which account or
accounts shall--
(A) be known as the ``System Benefits Trust Fund'';
and
(B) consist of amounts deposited in the Fund under
subsection (e).
(2) Status of fund.--The wires charges collected under
subsection (e) and deposited in the Fund--
(A) shall not constitute funds of the United
States;
(B) shall be held in trust by the Board solely for
the purposes stated in subsection (d); and
(C) shall not be available to meet any obligations
of the United States.
(d) Use of Fund.--
(1) Funding of state programs.--Amounts in the Fund shall
be used by the Board to provide matching funds to States and
Indian tribes for the support of State or tribal public
benefits programs relating to--
(A) energy conservation and efficiency;
(B) renewable energy sources;
(C) assisting low-income households in meeting
their home energy needs; or
(D) research and development in areas described in
subparagraphs (A) through (C).
(2) Distribution.--
(A) In general.--Except for amounts needed to pay
costs of the Board in carrying out its duties under
this section, the Board shall distribute all amounts in
the Fund to States or Indian tribes to fund public
benefits programs under paragraph (1).
(B) Fund share.--
(i) In general.--Subject to clause (iii),
the Fund share of a public benefits program
funded under paragraph (1) shall be 50 percent.
(ii) Proportionate reduction.--To the
extent that the amount of matching funds
requested by States and Indian tribes exceeds
the maximum projected revenues of the Fund, the
matching funds distributed to each State and
Indian tribe shall be reduced by an amount
equal to the proportion that the annual
consumption of electricity of the State or
Indian tribe bears to the annual consumption of
electricity of all States and Indian tribes.
(iii) Additional state or indian tribe
funding.--A State or Indian tribe may apply
funds to public benefits programs in addition
to the amount of funds applied for the purpose
of matching the Fund share.
(3) Program criteria.--The Board shall recommend
eligibility criteria for public benefits programs funded under
this section for approval by the Secretary.
(4) Application.--Not later than August 1 of each year
beginning in 2006, a State or Indian tribe seeking matching
funds for the following fiscal year shall file with the Board,
in such form as the Board may require, an application--
(A) certifying that the funds will be used for an
eligible public benefits program;
(B) stating the amount of State or Indian tribe
funds earmarked for the program; and
(C) summarizing how amounts from the Fund from the
previous calendar year (if any) were spent by the State
and what the State accomplished as a result of the
expenditures.
(e) Wires Charge.--
(1) Determination of needed funding.--Not later than
September 1 of each year, the Board shall determine and inform
the Commission of the aggregate amount of wires charges that
will be necessary to be paid into the Fund to pay matching
funds to States and Indian tribes and pay the operating costs
of the Board in the following fiscal year.
(2) Imposition of wires charge.--
(A) In general.--Not later than December 15 of each
year, the Commission shall impose a nonbypassable,
competitively neutral wires charge, to be paid directly
into the Fund by the operator of the wire, on
electricity carried through the wire (measured as the
electricity exits at the busbar at a generation
facility, or, for electricity generated outside the
United States, at the point of delivery to the wire
operator's system) in interstate commerce.
(B) Amount.--The wires charge shall be set at a
rate equal to the lesser of--
(i) 1.0 mills per kilowatt hour; or
(ii) a rate that is estimated to result in
the collection of an amount of wires charges
that is, to the maximum extent practicable,
equal to the amount of needed funding
determined under paragraph (1).
(3) Deposit in the fund.--The wires charge shall be paid by
the operator of the wire directly into the Fund at the end of
each month during the calendar year for distribution by the
Board under subsection (c).
(4) Penalties.--The Commission may assess against a wire
operator that fails to pay a wires charge as required by this
subsection a civil penalty in an amount equal to not more than
the amount of the unpaid wires charge.
(f) Auditing.--
(1) In general.--The Fund shall be audited annually by a
firm of independent certified public accountants in accordance
with generally accepted auditing standards.
(2) Access to records.--Representatives of the Secretary
and the Commission shall have access to all books, accounts,
reports, files, and other records pertaining to the Fund as
necessary to facilitate and verify the audit.
(3) Reports.--
(A) In general.--A report on each audit shall be
submitted to the Secretary, the Commission, and the
Secretary of the Treasury, who shall submit the report
to the President and Congress not later than 180 days
after the end of the fiscal year.
(B) Requirements.--An audit report shall--
(i) set forth the scope of the audit; and
(ii) include--
(I) a statement of assets and
liabilities, capital, and surplus or
deficit;
(II) a surplus of deficit analysis;
(III) a statement of income and
expenses;
(IV) any other information that may
be considered necessary to keep the
President and Congress informed of the
operations and financial condition of
the Fund; and
(V) any recommendations with
respect to the Fund that the Secretary
or the Commission may have.

SEC. 202. ELECTRICITY EFFICIENCY PERFORMANCE STANDARD.

Title VI of the Public Utility Regulatory Policies Act of 1978 (16
U.S.C. 2621 note) is amended by adding at the end the following:

``SEC. 609. FEDERAL ELECTRICITY EFFICIENCY PERFORMANCE STANDARD.

``(a) In General.--Each electric retail supplier shall implement
energy efficiency and load reduction programs and measures to achieve
verified improvements in energy efficiency and peak load reduction in
retail customer facilities and the distribution systems that serve
those facilities.
``(b) Power Savings.--The programs and measures under subsection
(a) shall produce savings in total peak power demand and total
electricity use by retail customers by an amount that is equal to or
greater than the following percentages relative to the peak demand and
electricity used in that year by the retail electric supplier's
customers:

------------------------------------------------------------------------
Reduction    Reduction
in demand      in use
------------------------------------------------------------------------
In calendar year 2006.........................           1%         .75%
In calendar year 2007.........................           2%         1.5%
In calendar year 2009.........................           4%         3.0%
In calendar year 2011.........................           6%         4.5%
In calendar year 2013.........................           8%         6.0%
In calendar year 2015.........................          10%         7.5%
------------------------------------------------------------------------

``(c) Beginning Date.--For purposes of this section, savings shall
be counted only for measures installed after January 1, 2006.
``(d) Rulemaking.--(1) Not later than June 30, 2005, the Secretary
shall establish, by rule--
``(A) procedures and standards for counting and
independently verifying energy and demand savings for purposes
of enforcing the energy efficiency performance standards
imposed by this section; and
``(B) procedures and a schedule for reporting findings to
the Department of Energy and for making the reports available
to the public.
``(2) In developing the procedures, standards, and schedule under
paragraph (1), the Secretary shall consult with--
``(A) the association representing public utility
regulators in the United States; and
``(B) the association representing the State energy
officials in the United States.
``(e) Reporting.--(1) Not later than June 30, 2008, and every 2
years thereafter, each retail electric supplier shall file with the
State public utilities commission in each State in which the supplier
provides service to retail customers a report demonstrating that the
retail electric supplier has taken action to comply with the energy
efficiency performance standards of this section.
``(2) A report filed under paragraph (1) shall include independent
verification of the estimated savings pursuant to standards established
by the Secretary.
``(3)(A) A State public utilities commission may--
``(i) accept a report as filed under paragraph (1); or
``(ii) review and investigate the accuracy of the report.
``(B) Each State public utilities commission shall--
``(i) make findings on any deficiencies relating to the
requirements under section 2; and
``(ii) issue a remedial order for the correction of any
deficiencies that are found.
``(f) Utilities Outside State Jurisdiction.--(1) An electric retail
supplier that is not subject to the jurisdiction of a State public
utilities commission shall submit reports in accordance with subsection
(e) to the governing body of the electric retail supplier.
``(2) A report submitted under paragraph (1) shall include
independent verification of the estimated savings pursuant to standards
established by the Secretary.
``(g) Program Participation.--(1) An electric retail supplier may
demonstrate satisfaction of the standard under this section, in whole
or part, by savings achieved through participation in statewide,
regional, or national programs that can be demonstrated to
significantly improve the efficiency of electric distribution and use.
``(2) Verified efficiency savings resulting from programs described
in paragraph (1) may be assigned to each participating retail supplier
based upon the degree of participation of the supplier in the programs.
``(3) An electric retail supplier may purchase rights to extra
savings achieved by other electric retail suppliers if the selling
supplier or another electric retail supplier does not also take credit
for those savings.
``(h) Remedies for Failure To Comply.--(1) In the event that any
retail electric supplier fails to achieve its energy savings or load
reduction target for a specific year, any aggrieved party may bring a
civil action or file an administrative claim to seek prompt remedial
action before a State public utilities commission (or, in the case of
an electric retail supplier not subject to State public utility
commission jurisdiction, before an appropriate governing body).
``(2)(A) The State public utilities commission or other appropriate
governing body shall have a maximum of 1 year to craft a remedy for a
civil action or claim filed under paragraph (1).
``(B) If a State public utilities commission or other governing
body certifies that the commission or body has inadequate resources or
authority to promptly resolve enforcement actions under this section,
or fails to take action within the time period specified in
subparagraph (A), the commission or body or an aggrieved party may seek
enforcement in Federal district court.
``(3)(A) If a commission or court determines that energy savings or
load reduction targets for a specific year have not been achieved by a
retail electric supplier under this section, the commission or court
shall--
``(i) determine the amount of the deficit; and
``(ii) fashion an equitable remedy to restore the lost
savings as soon as practicable.
``(B) A remedy under subparagraph (A)(ii) may include--
``(i) a refund to retail electric customers of an amount
equal to the retail cost of the electricity consumed due to the
failure to reach the target; and
``(ii) the appointment of a special master to administer a
bidding system to procure the energy and demand savings equal
to 125 percent of the deficit.''.

SEC. 203. APPLIANCE EFFICIENCY.

Section 325(d)(3) of the Energy Policy and Conservation Act (42
U.S.C. 6295(d)(3)) is amended by striking subparagraph (B) and
inserting the following:
``(B) Not later than January 1, 2009, the Secretary shall publish a
final rule to determine whether the standards in effect for central air
conditioners and central air conditioning heat pumps should be amended.
The rule shall address both system annual energy use and peak electric
demand and may include more than 1 efficiency descriptor. The rule
shall apply to products manufactured on or after January 1, 2012.''.

SEC. 204. LOAN GUARANTEES.

(a) Definitions.--In this section:
(1) Eligible activity.--The term ``eligible activity''
means--
(A) advanced technologies for high-efficiency
electricity transmission control and operation,
including high-efficiency power electronics
technologies (including software-controlled computer
chips and sensors to diagnose trouble spots and re-
route power into appropriate areas), high-efficiency
electricity storage systems, and high-efficiency
transmission wire or transmission cable system;
(B) distributed generation systems fueled solely
by--
(i) solar, wind, biomass, geothermal, or
ocean energy;
(ii) landfill gas;
(iii) natural gas systems utilizing best
available control technology;
(iv) fuel cells; or
(v) any combination of the above;
(C) combined heat and power systems; and
(D) energy efficiency systems producing
demonstrable electricity savings.
(2) Qualifying entity.--The term ``qualifying entity''
means an individual, corporation, partnership, joint venture,
trust or other entity identified by the Secretary under
subsection (d)(1) as eligible for a guaranteed loan under this
section.
(3) Secretary.--The term ``Secretary'' means the Secretary
of Energy.
(b) Authority.--The Secretary may guarantee not more than 50
percent of the principal of any loan made to a qualifying entity for
eligible activities under this section.
(c) Conditions.--
(1) In general.--The Secretary shall not guarantee a loan
under this section unless--
(A) the guarantee is a qualifying entity;
(B) the guarantee has filed an application with the
Secretary;
(C) the project, activity, program, or system for
which the loan is made is an eligible activity; and
(D) the project, activity, program, or system for
which the loan is made will significantly enhance the
reliability, security, efficiency, and cost-
effectiveness of electricity generation, transmission
or distribution.
(2) Priority.--The Secretary shall give priority to
guaranteed loans under this section for eligible activities
that accomplish the objectives of this section in the most
environmentally beneficial manner.
(3) Eligible financial institutions.--A loan guaranteed
under this section shall be made by a financial institution
subject to the examination of the Secretary.
(d) Rules.--Not later than 1 year after the date of enactment of
this section, the Secretary shall publish a final rule establishing
guidelines for loan requirements under this section, including
establishment of--
(1) criteria for determining which entities shall be
considered qualifying entities eligible for loan guarantees
under this section;
(2) criteria for determining which projects, activities,
programs, or systems shall be considered eligible activities
eligible for loan guarantees in accordance with the purposes of
this section;
(3) loan requirements including term, maximum size,
collateral requirements; and
(4) any other relevant features.
(e) Limitation on Size.--The Secretary may make commitments to
guarantee loans under this section only to the extent that the total
principal, any part of which is guaranteed, will not exceed
$10,000,000,000.
(f) Authorization of Appropriations.--There are authorized to be
appropriated to the Secretary such sums as are necessary to cover the
cost of loan guarantees (as defined by section 502(5) of the Federal
Credit Reform Act of 1990 (2. U.S.C. 661a(5))) under this section.

TITLE III--ONSITE GENERATION

SEC. 301. NET METERING.

(a) Adoption of Standard.--Section 111(d) of the Public Utility
Regulatory Policies Act of 1978 (16 U.S.C. 2621(d)) is amended by
adding at the end the following:
``(11) Net metering.--
``(A) In general.--Each electric utility shall make
available upon request net metering service to any electric
consumer that the electric utility serves.
``(B) References.--For purposes of implementing this
paragraph, any reference contained in this section to the date
of enactment of this Act shall be deemed to be a reference to
the date of enactment of this paragraph.''.
(b) Special Rules for Net Metering.--Section 115 of the Public
Utility Regulatory Policies Act of 1978 (16 U.S.C. 2625) is amended by
adding at the end the following:
``(i) Net Metering.--(1) In this subsection:
``(A) The term `eligible onsite generating facility'
means--
``(i) a facility on the site of a residential
electric consumer with a maximum generating capacity of
25 kilowatts or less; or
``(ii) a facility on the site of a commercial
electric consumer with a maximum generating capacity of
1,000 kilowatts or less,
that is fueled solely by a renewable energy resource.
``(B) The term `net metering service' means service to an
electric consumer under which electric energy generated by that
electric consumer from an eligible onsite generating facility
and delivered to the local distribution facilities may be used
to offset electric energy provided by the electric utility to
the electric consumer during the applicable billing period.
``(C) The term `renewable energy resource' means--
``(i) solar, wind, biomass, geothermal, or wave
energy;
``(ii) landfill gas;
``(iii) fuel cells; and
``(iv) a combined heat and power system.
``(2) In undertaking the consideration and making the determination
concerning net metering established by section 111(d)(11), the
following shall apply:
``(A) An electric utility--
``(i) shall charge the owner or operator of an
onsite generating facility rates and charges that are
identical to those that would be charged other electric
consumers of the electric utility in the same rate
class; and
``(ii) shall not charge the owner or operator of an
onsite generating facility any additional standby,
capacity, interconnection, or other rate or charge.
``(B) An electric utility that sells electric energy to the
owner or operator of an onsite generating facility shall
measure the quantity of electric energy produced by the onsite
facility and the quantity of electricity consumed by the owner
or operator of an onsite generating facility during a billing
period in accordance with normal metering practices.
``(C) If the quantity of electric energy sold by the
electric utility to an on-site generating facility exceeds the
quantity of electric energy supplied by the onsite generating
facility to the electric utility during the billing period, the
electric utility may bill the owner or operator for the net
quantity of electric energy sold, in accordance with normal
metering practices.
``(D) If the quantity of electric energy supplied by the
onsite generating facility to the electric utility exceeds the
quantity of electric energy sold by the electric utility to the
onsite generating facility during the billing period--
``(i) the electric utility may bill the owner or
operator of the onsite generating facility for the
appropriate charges for the billing period in
accordance with subparagraph (B); and
``(ii) the owner or operator of the onsite
generating facility shall be credited for the excess
kilowatt-hours generated during the billing period,
with the kilowatt-hour credit appearing on the bill for
the following billing period.
``(E) An eligible onsite generating facility and net
metering system used by an electric consumer shall meet all
applicable safety, performance, reliability, and
interconnection standards established by the National
Electrical Code, the Institute of Electrical and Electronics
Engineers, and Underwriters Laboratories.
``(F) The Commission, after consultation with State
regulatory authorities and nonregulated electric utilities and
after notice and opportunity for comment, may adopt, by rule,
additional control and testing requirements for onsite
generating facilities and net metering systems that the
Commission determines are necessary to protect public safety
and system reliability.
``(G) An electric utility must provide net metering
services to electric consumers until the cumulative generating
capacity of net metering systems equals 1.0 percent of the
utility's peak demand during the most recent calendar year.
``(H) Nothing in this subsection precludes a State from
imposing additional requirements regarding the amount of net
metering available within a State consistent with the
requirements of this section.''.

SEC. 302. INTERCONNECTION.

(a) Definitions.--Section 3 of the Federal Power Act (16 U.S.C.
796) is amended--
(1) by striking paragraph 23 and inserting the following:
``(23) Transmitting utility.--The term `transmitting
utility' means any entity (notwithstanding section 201(f)) that
owns, controls, or operates an electric power transmission
facility that is used for the sale of electric energy.''; and
(2) by adding at the end the following:
``(26) Appropriate regulatory authority.--The term
`appropriate regulatory authority' means--
``(A) the Commission;
``(B) a State commission;
``(C) a municipality; or
``(D) a cooperative that is self-regulating under
State law and is not a public utility.
``(27) Generating facility.--The term `generating facility'
means a facility that generates electric energy.
``(28) Local distribution utility.--The term `local
distribution facility' means an entity that owns, controls, or
operates an electric power distribution facility that is used
for the sale of electric energy.
``(29) Non-federal regulatory authority.--The term `non-
Federal regulatory authority' means an appropriate regulatory
authority other than the Commission.''.
(b) Interconnection to Distribution Facilities.--Section 210 of the
Federal Power Act (16 U.S.C. 824i) is amended--
(1) by redesignating subsection (e) as subsection (g); and
(2) by inserting after subsection (d) the following:
``(e) Interconnection to Distribution Facilities.--(1)(A) A local
distribution utility shall interconnect a generating facility with the
distribution facilities of the local distribution utility if the owner
of the generating facility--
``(i) complies with the final rule promulgated under
paragraph (2); and
``(ii) pays the costs of the interconnection.
``(B) The costs of the interconnection--
``(i) shall be just and reasonable, and not unduly
discriminatory or preferential, as determined by the
appropriate regulatory authority; and
``(ii) shall be comparable to the costs charged by the
local distribution utility for interconnection by any similarly
situated generating facility to the distribution facilities of
the local distribution utility.
``(C) The right of a generating facility to interconnect under
subparagraph (A) does not relieve the generating facility or the local
distribution utility of other Federal, State, or local requirements.
``(2) Not later than 180 days after the date of enactment of this
subparagraph, the Commission shall promulgate final rules establishing
reasonable and appropriate technical standards for the interconnection
of a generating facility with the distribution facilities of a local
distribution utility.
``(3)(A) In accordance with subparagraph (B) a local distribution
utility shall offer to sell backup power to a generating facility that
has interconnected with the local distribution utility to the extent
that the local distribution utility--
``(i) is not subject to an order of a non-Federal
regulatory authority to provide open access to the distribution
facilities of the local distribution utility;
``(ii) has not offered to provide open access to the
distribution facilities of the local distribution utility; or
``(iii) does not allow a generating facility to purchase
backup power from another entity using the distribution
facilities of the local distribution utility.
``(B) A sale of backup power under subparagraph (A) shall be at
such a rate, and under such terms and conditions as are just and
reasonable and not unduly discriminatory or preferential, taking into
account the actual incremental cost, whenever incurred by the local
distribution utility, to supply such backup power service during the
period in which the backup power service is provided, as determined by
the appropriate regulatory authority.
``(C) A local distribution utility shall not be required to offer
backup power for resale to any entity other than the entity for which
the backup power is purchased.
``(D) To the extent backup power is used to serve a new or expanded
load on the distribution system, the generating facility shall pay any
reasonable cost associated with any transmission, distribution, or
generating upgrade required to provide such service.''.
(c) Interconnection to Transmission Facilities.--Section 210 of the
Federal Power Act (16 U.S.C. 824i) (as amended by subsection (b)) is
amended by inserting after subsection (e) the following:
``(f) Interconnection to Transmission Facilities.--(1)(A)
Notwithstanding subsections (a) and (c), a transmitting utility shall
interconnect a generating facility with the transmission facilities of
the transmitting utility if the owner of the generating facility--
``(i) complies with the final rules promulgated under
paragraph (2); and
``(ii) pays the costs of interconnection.
``(B) Subject to subparagraph (C), the costs of interconnection--
``(i) shall be just and reasonable and not unduly
discriminatory or preferential; and
``(ii) shall be comparable to the costs charged by the
transmitting utility for interconnection by any similarly
situated generating facility to the transmitting facilities of
the transmitting utility.
``(C) A non-Federal regulatory authority that is authorized under
Federal law to determine the rates for transmission service shall be
authorized to determine the costs of any interconnection under this
subparagraph.
``(D) The right of a generating facility to interconnect under
subparagraph (A) does not relieve the generating facility or the
transmitting utility of other Federal, State, or local requirements.
``(2) Not later than 180 days after the date of enactment of this
subparagraph, the Commission shall promulgate rules establishing
reasonable and appropriate technical standards for the interconnection
of a generating facility with the transmission facilities of a
transmitting utility.
``(3)(A) In accordance with subparagraph (B), a transmitting
utility shall offer to sell backup power to a generating facility that
has interconnected with the transmitting utility unless--
``(i) Federal or State law allows a generating facility to
purchase backup power from an entity other than the
transmitting utility; or
``(ii) a transmitting utility allows a generating facility
to purchase backup power from an entity other than the
transmitting utility using the transmission facilities of the
transmitting utility and the transmission facilities of any
other transmitting utility.
``(B) A sale of backup power under subparagraph (A) shall be at
such a rate and under such terms and conditions as are just and
reasonable and not unduly discriminatory or preferential, taking into
account the actual incremental cost, whenever incurred by the local
distribution utility, to supply such backup power service during the
period in which the backup power service is provided, as determined by
the appropriate regulatory authority.
``(C) A transmitting utility shall not be required to offer backup
power for resale to any entity other than the entity for which the
backup power is purchased.
``(D) To the extent backup power is used to serve a new or expanded
load on the transmission system, the generating facility shall pay any
reasonable costs associated with any transmission, distribution, or
generation upgrade required to provide the service.''.
(d) Conforming Amendments.--Section 210 of the Federal Power Act
(16 U.S.C. 824i) is amended--
(1) in subsection (a)(1)--
(A) by inserting ``transmitting utility, local
distribution utility,'' after ``electric utility,'';
and
(B) in subparagraph (A), by inserting ``any
transmitting utility,'' after ``small power production
facility,'';
(2) in subsection (b)(2), by striking ``an evidentiary
hearing'' and inserting ``a hearing'';
(3) in subsection (c)(2)--
(A) in subparagraph (B), by striking ``or'' at the
end;
(B) in subparagraph (C), by striking ``and'' at the
end and inserting ``or''; and
(C) by adding at the end the following:
``(D) promote competition in electricity markets,
and''; and
(4) in subsection (d), by striking the last sentence.

SEC. 303. ONSITE GENERATION FOR EMERGENCY FACILITIES.

(a) Definitions.--In this section:
(1) Eligible facility.--The term ``eligible facility''
means a building owned or operated by a State or local
government that is used for--
(A) critical governmental dispatch and
communication;
(B) police, fire, or emergency services;
(C) traffic control systems; or
(D) public water or sewer systems.
(2) Renewable uninterruptible power supply system.--The
term ``renewable uninterruptible power supply system'' means a
system designed to maintain electrical power to critical loads
in a public facility in the event of a loss or disruption in
conventional grid electricity, where such system derives its
energy production or storage capacity solely from--
(A) solar, wind, biomass, geothermal, or ocean
energy;
(B) natural gas;
(C) landfill gas;
(D) a fuel cell device; or
(E) a combination of energy described in
subparagraphs (A) through (D).
(3) Secretary.--The term ``Secretary'' means the Secretary
of Energy.
(b) Demonstration and Technology Transfer Program.--The Secretary
shall establish a demonstration program for the implementation of
innovative technologies for renewable uninterruptible power supply
systems located in eligible buildings and for the dissemination of
information on those systems to interested parties.
(c) Limit on Federal Funding.--The Secretary shall provide not more
than 40 percent of the costs of projects funded under this section.
(d) Authorization of Appropriations.--There is authorized to be
appropriated to carry out this section $30,000,000 for each of fiscal
years 2006 through 2009.
<all>