[Congressional Bills 109th Congress]
[From the U.S. Government Publishing Office]
[S. 427 Introduced in Senate (IS)]
109th CONGRESS
1st Session
S. 427
To amend the Public Utility Regulatory Policies Act of 1978 to provide
for a Federal renewable portfolio standard.
_______________________________________________________________________
IN THE SENATE OF THE UNITED STATES
February 17, 2005
Mr. Jeffords (for himself, Ms. Snowe, Ms. Cantwell, Mrs. Feinstein, Mr.
Durbin, Mr. Kennedy, Mr. Reed, Mr. Kerry, Mr. Dodd, Mrs. Boxer, and Mr.
Lautenberg) introduced the following bill; which was read twice and
referred to the Committee on Energy and Natural Resources
_______________________________________________________________________
A BILL
To amend the Public Utility Regulatory Policies Act of 1978 to provide
for a Federal renewable portfolio standard.
Be it enacted by the Senate and House of Representatives of the
United States of America in Congress assembled,
SECTION 1. SHORT TITLE.
This Act may be cited as the ``Renewable Energy Investment Act of
2005''.
SEC. 2. RENEWABLE PORTFOLIO STANDARD.
Title VI of the Public Utility Regulatory Policies Act of 1978 (16
U.S.C. 2601 et seq.) is amended by adding at the end the following:
``SEC. 606. FEDERAL RENEWABLE PORTFOLIO STANDARD.
``(a) Definitions.--In this section:
``(1) Biomass.--
``(A) In general.--The term `biomass' means--
``(i) organic material from a plant that is
planted for the purpose of being used to
produce energy;
``(ii) nonhazardous, cellulosic or
agricultural waste material that is segregated
from other waste materials and is derived
from--
``(I) a forest-related resource,
including--
``(aa) mill and harvesting
residue;
``(bb) precommercial
thinnings;
``(cc) slash; and
``(dd) brush;
``(II) agricultural resources,
including--
``(aa) orchard tree crops;
``(bb) vineyards;
``(cc) grains;
``(dd) legumes;
``(ee) sugar; and
``(ff) other crop by-
products or residues; or
``(III) miscellaneous waste such
as--
``(aa) waste pallet;
``(bb) crate; and
``(cc) landscape or right-
of-way tree trimmings; and
``(iii) animal waste that is converted to a
fuel rather than directly combusted, the
residue of which is converted to a biological
fertilizer, oil, or activated carbon.
``(B) Exclusions.--The term `biomass' shall not
include--
``(i) municipal solid waste that is
incinerated;
``(ii) recyclable post-consumer waste
paper;
``(iii) painted, treated, or pressurized
wood;
``(iv) wood contaminated with plastics or
metals; or
``(v) tires.
``(2) Distributed generation.--The term `distributed
generation' means reduced electricity consumption from the
electric grid due to use by a customer of renewable energy
generated at a customer site.
``(3) Incremental hydropower.--The term `incremental
hydropower' means additional generation achieved from increased
efficiency after January 1, 2005, at a hydroelectric dam that
was placed in service before January 1, 2005.
``(4) Landfill gas.--The term `landfill gas' means gas
generated from the decomposition of household solid waste,
commercial solid waste, and industrial solid waste disposed of
in a municipal solid waste landfill unit (as those terms are
defined in regulations promulgated under subtitle D of the
Solid Waste Disposal Act (42 U.S.C. 6941 et seq.)).
``(5) Renewable energy.--The term `renewable energy' means
electricity generated from
``(A) a renewable energy source; or
``(B) hydrogen that is produced from a renewable
energy source.
``(6) Renewable energy source.--The term `renewable energy
source' means--
``(A) wind;
``(B) ocean waves;
``(C) biomass;
``(D) solar;
``(E) landfill gas;
``(F) incremental hydropower; or
``(G) geothermal.
``(7) Retail electric supplier.--The term `retail electric
supplier' means a person or entity that sells retail
electricity to consumers, and which sold not less than 500,000
megawatt-hours of electric energy to consumers for purposes
other than resale during the preceding calendar year.
``(8) Secretary.--The term `Secretary' means the Secretary
of Energy.
``(b) Renewable Energy Requirements.--
``(1) In general.--For each calendar year beginning in
Calendar year 2006, each retail electric supplier shall submit
to the Secretary, not later than April 30 of each year,
renewable energy credits in an amount equal to the required
annual percentage of the retail electric supplier's total
amount of kilowatt-hours of non-hydropower (excluding
incremental hydropower) electricity sold to retail consumers
during the previous calendar year.
``(2) Carryover.--A renewable energy credit for any year
that is not used to satisfy the minimum requirement for that
year may be carried over for use within the next two years.
``(c) Required Annual Percentage.--Of the total amount of non-
hydropower (excluding incremental hydropower) electricity sold by each
retail electric supplier during a calendar year, the amount generated
by renewable energy sources shall be not less than the percentage
specified below:
Percentage of
Renewable energy
``Calendar years: Each year:
2006-2009..................................... 5
2010-2014..................................... 10
2015-2019..................................... 15
2020 and subsequent years..................... 20.
``(d) Submission of Renewable Energy Credits.--
``(1) In general.--To meet the requirements under
subsection (b), a retail electric supplier shall submit to the
Secretary either--
``(A) renewable energy credits issued to the retail
electric supplier under subsection (f);
``(B) renewable energy credits obtained by purchase
or exchange under subsection (g);
``(C) renewable energy credits purchased from the
United States under subsection (h); or
``(D) any combination of credits under subsections
(f), (g) or (h).
``(2) Prohibition on double counting.--A credit may be
counted toward compliance with subsection (b) only once.
``(e) Renewable Energy Credit Program.--The Secretary shall
establish, not later than 1 year after the date of enactment of this
Act, a program to issue, monitor the sale or exchange of, and track,
renewable energy credits.
``(f) Issuance of Renewable Energy Credits.--
``(1) In general.--Under the program established in
subsection (e), an entity that generates electric energy
through the use of a renewable energy resource may apply to the
Secretary for the issuance of renewable energy credits.
``(2) Application.--An application for the issuance of
renewable energy credits shall indicate--
``(A) the type of renewable energy resource used to
produce the electric energy;
``(B) the State in which the electric energy was
produced; and
``(C) any other information the Secretary
determines appropriate.
``(3) Credit value.--Except as provided in subparagraph
(4), the Secretary shall issue to an entity applying under this
subsection 1 renewable energy credit for each kilowatt-hour of
renewable energy generated in any State from the date of
enactment of this Act and in each subsequent calendar year.
``(4) Credit value for distributed generation.--The
Secretary shall issue 3 renewable energy credits for each
kilowatt-hour of distributed generation.
``(5) Vesting.--A renewable energy credit will vest with
the owner of the system or facility that generates the
renewable energy unless such owner explicitly transfers the
credit.
``(6) Credit eligibility.--To be eligible for a renewable
energy credit, the unit of electricity generated through the
use of a renewable energy resource shall be sold for retail
consumption or used by the generator. If both a renewable
energy resource and a non-renewable energy resource are used to
generate the electric energy, the Secretary shall issue
renewable energy credits based on the proportion of the
renewable energy resource used.
``(7) Identifying credits.--The Secretary shall identify
renewable energy credits by the type and date of generation.
``(8) Sale under purpa contract.--When a generator sells
electric energy generated through the use of a renewable energy
resource to a retail electric supplier under a contract subject
to section 210 of the Public Utilities Regulatory Policies Act
of 1978 (16 U.S.C. 824a-3), the retail electric supplier is
treated as the generator of the electric energy for the
purposes of this Act for the duration of the contract.
``(g) Sale or Exchange of Renewable Energy Credits.--A renewable
energy credit may be sold or exchanged by the entity issued the
renewable energy credit or by any other entity that acquires the
renewable energy credit. Credits may be sold or exchanged in any manner
not in conflict with existing law, including on the spot market or by
contractual arrangements of any duration.
``(h) Purchase From the United States.--The Secretary shall offer
renewable energy credits for sale at the lesser of three cents per
kilowatt-hour or 110 percent of the average market value of credits for
the applicable compliance period. On January 1 of each year following
calendar year 2006, the Secretary shall adjust for inflation the price
charged per credit for such calendar year.
``(i) State Programs.--Nothing in this section shall preclude any
State from requiring additional renewable energy generation in the
State under any renewable energy program conducted by the State.
``(j) Consumer Allocation.--The rates charged to classes of
consumers by a retail electric supplier shall reflect a proportional
percentage of the cost of generating or acquiring the required annual
percentage of renewable energy under subsection (b). A retail electric
supplier shall not represent to any customer or prospective customer
that any product contains more than the percentage of eligible
resources if the additional amount of eligible resources is being used
to satisfy the renewable generation requirement under subsection (b).
``(k) Enforcement.--A retail electric supplier that does not submit
renewable energy credits as required under subsection (b) shall be
liable for the payment of a civil penalty. That penalty shall be
calculated on the basis of the number of renewable energy credits not
submitted, multiplied by the lesser of 4.5 cents or 300 percent of the
average market value of credits for the compliance period.
``(l) Information Collection.--The Secretary may collect the
information necessary to verify and audit--
``(1) the annual electric energy generation and renewable
energy generation of any entity applying for renewable energy
credits under this section;
``(2) the validity of renewable energy credits submitted by
a retail electric supplier to the Secretary; and
``(3) the quantity of electricity sales of all retail
electric suppliers.
``(m) Voluntary Participation.--The Secretary may issue a renewable
energy credit pursuant to subsection (f) to any entity not subject to
the requirements of this Act only if the entity applying for such
credit meets the terms and conditions of this Act to the same extent as
entities subject to this Act.
``(n) State Renewable Energy Grant Program.--
``(1) Distribution to states.--The Secretary shall
distribute amounts received from sales under subsection (h) and
from amounts received under subsection (k) to States to be used
for the purposes of this section.
``(2) Regional equity program.--
``(A) Establishment of program.--Within 1 year from
the date of enactment of this Act, the Secretary shall
establish a program to promote renewable energy
production and use consistent with the purposes of this
section.
``(B) Eligibility.--The Secretary shall make funds
available under this section to State energy agencies
for grant programs for--
``(i) renewable energy research and
development;
``(ii) loan guarantees to encourage
construction of renewable energy facilities;
``(iii) consumer rebate or other programs
to offset costs of small residential or small
commercial renewable energy systems including
solar hot water; or
``(iv) promoting distributed generation.
``(3) Allocation preferences.--In allocating funds under
the program, the Secretary shall give preference to--
``(A) States in regions which have a
disproportionately small share of economically
sustainable renewable energy generation capacity; and
``(B) State grant programs most likely to stimulate
or enhance innovative renewable energy technologies.''.
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