H.R. 4861 (106th): Clean Power Act

106th Congress, 1999–2000. Text as of Jul 13, 2000 (Introduced).

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HR 4861 IH

106th CONGRESS

2d Session

H. R. 4861

To address the acid rain and greenhouse gas impacts of electric utility restructuring and to encourage the development of renewable energy resources, and for other purposes.

IN THE HOUSE OF REPRESENTATIVES

July 13, 2000

Mr. LAZIO (for himself and Mr. BOEHLERT) introduced the following bill; which was referred to the Committee on Commerce


A BILL

To address the acid rain and greenhouse gas impacts of electric utility restructuring and to encourage the development of renewable energy resources, 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

    This Act may be cited as the ‘Clean Power Act’.

SEC. 2. NITROGEN OXIDE AND CARBON DIOXIDE ALLOWANCE TRADING PROGRAM.

    (a) DEFINITIONS- In this section:

      (1) ADMINISTRATOR- The term ‘Administrator’ means the Administrator of the Environmental Protection Agency.

      (2) AFFECTED FACILITY- The term ‘affected facility’ means--

        (A) a combustion unit in the 48 contiguous States and the District of Columbia that serves at least one electric generator with a nameplate capacity of 25 megawatts or greater to generate electricity and that combusts any fuel, including biomass, or

        (B) a facility in the 48 contiguous States and the District of Columbia generating 5 kilowatts of electricity or greater using wind, geothermal, solar thermal, or photovoltaic energy.

      (3) NOX ALLOWANCE- The term ‘NOX allowance’ means a limited authorization under subsection (b)(3) to emit quantities of nitrogen oxide.

      (4) CO2 ALLOWANCE- The term ‘CO2 Allowance’ means a limited authorization under subsection (b)(4) to emit quantities of carbon dioxide.

      (5) PROGRAM- The term ‘Program’ means the Nitrogen Oxide or a Carbon Dioxide Allowance Program established under subsection (b).

      (6) TOTAL OUTPUT PRODUCTION- The term ‘total output production’ means the sum of electricity and steam generated by all affected facilities in the 48 contiguous States and the District of Columbia.

    (b) IN GENERAL- (1) Not later than 1 year after the date of enactment of this Act, the Administrator shall promulgate a final regulation to address interstate transport of nitrogen oxide and carbon dioxide pollution. Under such program, the Administrator shall establish a program to issue, record the sale or exchange of, and track NOX and CO2 allowances and to monitor and track emissions of nitrogen oxide.

    (2) After January 1, 2005, the total number of NOX allowances distributed each year under such Program shall not be greater than 2,750,000 and the total number of CO2 allowances distributed each year shall not be greater than 1,914,000,000.

    (3) Each NOX allowance issued under such Program shall authorize an affected facility to emit--

      (A) 1/2 ton of nitrogen oxide during the ozone period of May 1 through September 30 of any year, or

      (B) 1 ton of nitrogen oxide for any period of any year not covered in subparagraph (A).

    (4) Each CO2 allowance issued under such program shall authorize an affected facility to emit 1 ton of carbon dioxide.

    (5) The regulations under this section shall require affected facilities to report electric generation and other data the Administrator deems necessary to determine allocations and to ensure compliance with the Program. The owner or operator of an affected facility shall be required to install and operate continuous emissions monitoring systems at the facility or an alternative monitoring system approved by the Administrator.

    (6) The regulation under this section shall establish a tracking system for NOX and CO2 allowances. A NOX or CO2 allowance allocation or transfer shall, on recordation by the Administrator, be considered to be a part of any operating permit requirements of each affected facility involved in the allocation or transfer, without a requirement for any further permit review or revision.

    (7) The use of any NOX or CO2 allowance before the calendar year for which the NOX or CO2 allowance is allocated shall be prohibited.

    (c) ALLOCATIONS- The Administrator shall promulgate regulations that shall--

      (1) place 5 percent of the total quantity of NOX allowances and 5 percent of the total quantity of CO2 allowances available each year into a new source reserve,

      (2) distribute to each affected facility the remaining NOX and CO2 allowances for each calendar year,

      (3) distribute the allocations to each affected facility in proportion to each affected facility’s share of total output production,

      (4) distribute 2 years of allowances to each affected facility every 2 years, at least 6 months prior to the beginning of the relevant 2-year period,

      (5) distribute to each new affected facility from the new source reserve prior to the relevant control period, and

      (6) redistribute any allowances remaining in the new source reserve after the relevant control period to--

        (A) affected sources in proportion to each facility’s share of total output production, or

        (B) the following year’s new source reserve, if the Administrator determines that the reserve will be insufficient to meet expected need.

    (d) INSUFFICIENT ALLOWANCES- If the Administrator determines that the quantity of allowances in the new source reserve in subsection (c) is insufficient to accommodate the operations of new facilities, the Administrator shall promulgate a regulation to set a new percentage of the total annual quantity of NOX or CO2 allowances to place into the new source reserve, no later than 6 months prior to the beginning of the next 2-year allocation period.

    (e) ENFORCEMENT- (1) An affected facility may not emit nitrogen oxides and carbon dioxide in excess of the amount permitted by the quantity of NOX or CO2 allowances held by the designated representative of the affected facility in the NOX allowance tracking system starting in the calendar year 2005.

    (2) If an affected facility emits nitrogen oxides in excess of the amount permitted, the Administrator shall calculate the deficit of additional NOX allowances the affected facility would require to authorize the emitted quantity of nitrogen oxides. The affected facility shall--

      (A) pay $6,000 for each additional NOX allowance calculated, and

      (B) offset in the following calendar year a quantity of NOX allowances equal to the number of NOX allowances calculated.

    (3) If an affected facility emits carbon dioxide in excess of the amount permitted, the Administrator shall calculate the deficit of additional CO2 allowances the affected facility would require to authorize the emitted quantity of carbon dioxide. The affected facility shall--

      (A) pay $100 for each additional CO2 allowance calculated, and

      (B) offset in the following year a quantity of CO2 allowances equal to the number of CO2 allowances calculated.

    (4) For every year after 2005, the Administrator shall annually adjust the amount of the penalty in paragraphs (2)(A) and (3)(A) to reflect changes in the Consumer Price Index.

    (f) REPEAL OF OTHER NOX LIMITATIONS- Section 407 of the Clean Air Act (42 U.S.C. 7651f) is repealed as of the date the provisions of this section related to NOX are implemented.

    (g) CONSTRUCTION- Neither a NOX allowance nor a CO2 allowance shall be considered to be a property right. Notwithstanding any other provision of law, the Administrator may terminate or limit a NOX or CO2 allowance.

    (h) SAVINGS PROVISIONS- Nothing in this section affects the application of, or compliance with, the Clean Air Act for an affected facility, including the provisions related to applicable national ambient air quality standards and State implementation plans or requires a change in, affects, or limits any State law regulating electric utility rates or charges, including prudency review under State law, affects the application of the Federal Power Act (16 U.S.C. 791a et seq.) or the authority of the Commission under that Act, or interferes with or impairs any program for competitive bidding for power supply in any State.

SEC. 3. SULFUR DIOXIDE ALLOWANCE PROGRAM REVISIONS.

    Section 402 of the Clean Air Act (42 U.S.C. 7651) is amended by striking paragraph (3) and inserting the following:

      ‘(3) ALLOWANCE- The term ‘allowance’ means an authorization, allocated to an affected unit by the Administrator under this title, to emit, during or after a specified calendar year--

        ‘(A) in the case of allowances allocated for calendars years 1997 through 2004, one ton of sulfur dioxide, and

        ‘(B) in the case of allowances allocated for calendar year 2005 and each calendar year thereafter, 1/4 ton of sulfur dioxide.’.

SEC. 4. MERCURY EMISSION CONTROL.

    (a) EMISSION CONTROLS- The Administrator shall promulgate regulations based on the protection of human health and the environment controlling electric utility emissions of mercury in accordance with this section.

    (b) NATIONWIDE STANDARD- The nationwide standard under this section for calendar year 2005 and each year thereafter for electric utility emissions of mercury shall be not greater than 5 tons.

    (c) FACTORS- The regulations under this section shall take into account technological feasibility, cost, and the projected reduction in levels of mercury emissions that will result from implementation of this Act. Such regulations shall prevent localized adverse effects on public health and the environment and shall prohibit emission trading in mercury.

SEC. 5. RENEWABLE PORTFOLIO STANDARD.

    (a) STANDARD- Title II of the Public Utility Regulatory Policies Act of 1978 (16 U.S.C. 2601 and following) is amended by adding after section 214 the following new section:

‘SEC. 215. FEDERAL RENEWABLE PORTFOLIO STANDARD.

    ‘(a) EFFECTIVE DATE- The Administrator of the Energy Information Administration in the Department of Energy shall publish a notice on or before January 1, 2005, specifying the percentage of total electric energy generation in the United States that the Administrator estimates to be supplied by renewable energy during the calendar year 2004. If such percentage is less than 3 percent, this section shall take effect on January 1, 2005.

    ‘(b) MINIMUM RENEWABLE GENERATION REQUIREMENT- (1) For each calendar year beginning after the effective date of this section, and ending January 1, 2010, a retail electric supplier shall submit to the Secretary of Energy (referred to in this section as the ‘Secretary’) Renewable Energy Credits in an amount equal to 3 percent of the total electric energy sold by the retail electric supplier to electric consumers in the calendar year. For each calendar year beginning January 1, 2010, a retail electric supplier shall submit to the Secretary Renewable Energy Credits in an amount equal to 6 percent of the total electric energy sold by the retail electric supplier to electric consumers in the calendar year. The retail electric supplier shall make this submission before April 1 of the following calendar year.

    ‘(2) For purposes of this section, a ‘renewable energy’ resource means solar energy, wind, geothermal, or biomass.

    ‘(3) This section does not preclude a State from requiring additional renewable energy generation in that State.

    ‘(c) SUBMISSION OF CREDITS- A retail electric supplier may satisfy the requirements of subsection (a) through the submission of--

      ‘(1) Renewable Energy Credits issued under subsection (d) for renewable energy generated by the retail electric supplier in the calendar year for which credits are being submitted or any previous calendar year,

      ‘(2) Renewable Energy Credits issued under subsection (d) to any renewable energy generator for renewable energy generated in the calendar year for which credits are being submitted or a previous calendar year and acquired by the retail electric supplier, or

      ‘(3) any combination of credits under paragraphs (1) and (2).

    ‘(d) ISSUANCE OF CREDITS- (1) The Secretary shall establish a program to issue, monitor the sale or exchange of, and track Renewable Energy Credits.

    ‘(2) Under the program, 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. The application shall indicate--

      ‘(A) the type of renewable energy resource used to produce the electricity,

      ‘(B) the State in which the electric energy was produced, and

      ‘(C) any other information the Secretary determines appropriate.

    ‘(3)(A) Except as provided in subparagraph (B), the Secretary shall issue to an entity 1 Renewable Energy Credit for each kilowatt-hour of electric energy the entity generates through the use of a renewable energy resource in any State in 2005 and any succeeding year.

    ‘(B) To be eligible for a Renewable Energy Credit, the unit of electricity generated through the use of a renewable energy resource may be sold or may be used by the generator. If both a renewable energy resource and a nonrenewable energy resource are used to generate the electric energy, the Secretary shall issue credits based on the proportion of the renewable energy resource used. The Secretary shall identify Renewable Energy Credits by type of generation and by the State in which the generating facility is located.

    ‘(4) In order to receive a Renewable Energy Credit, the recipient of a Renewable Energy Credit shall pay a fee, calculated by the Secretary, in an amount that is equal to the administrative costs of issuing, recording, monitoring the sale or exchange of, and tracking the credit, or does not exceed 5 percent of the dollar value of the credit, whichever is lower. The Secretary shall retain the fee and use it to pay these administrative costs.

    ‘(5) 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 this Act, the retail electric supplier is treated as the generator of the electric energy for the purposes of this section for the duration of the contract.

    ‘(6) The Secretary shall disqualify an otherwise eligible renewable energy generator from receiving a Renewable Energy Credit if the generator has elected to participate in net metering under section 216.

    ‘(e) SALE OR EXCHANGE- A Renewable Energy Credit may be sold or exchanged by the entity to which it was issued or by any other entity that acquires the credit. A Renewable Energy Credit for any year that is not

used to satisfy the minimum renewable generation requirement of subsection (a) for that year may be carried forward for use in another year.

    ‘(f) RENEWABLE ENERGY CREDIT COST CAP- Beginning on the effective date of this section, the Secretary shall offer Renewable Energy Credits for sale. The Secretary shall charge 1.5 cents for each Renewable Energy Credit sold during calendar year 2005, and on January 1 of each following year, the Secretary shall adjust for inflation, based on the Consumer Price Index, the price charged per credit for that calendar year.

    ‘(g) RENEWABLE ENERGY AND ENERGY EFFICIENCY FUND- The Secretary shall deposit in a separate account the amount received from a sale under subsection (f). Amounts in the separate account shall be available, without further appropriation, to the Secretary to be used for purposes of providing assistance for research and development of cleaner burning fuels, renewable energy, and energy efficiency.

    ‘(h) ENFORCEMENT- The Secretary may bring an action in the appropriate United States district court to impose a civil penalty on a retail electric supplier that does not comply with subsection (b). A retail electric supplier that does not submit the required number of Renewable Energy Credits under subsection (b) is subject to a civil penalty of not more than 3 times the value of the Renewable Energy Credits not submitted. For purposes of this subsection, the value of a Renewable Energy Credit is the price of a credit determined under subsection (f) for the year the credits were not submitted.

    ‘(i) 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.

    ‘(j) SUNSET- This section expires December 31, 2015.’.

    (b) DEFINITIONS- Section 3 of the Public Utility Regulatory Policies Act of 1978 (16 U.S.C. 2602) is amended by adding after paragraph (24) the following new paragraph:

      ‘(25) The term ‘retail electric supplier’ means a person, State agency, or Federal agency that sells electric energy to an electric consumer.’.

    (c) TABLE OF CONTENTS- The table of contents for title II of the Public Utility Regulatory Policies Act of 1978 (16 U.S.C. 2601 and following) is amended by adding the following at the end thereof:

      ‘Sec. 215. Federal renewable portfolio standard.’.

SEC. 6. NET METERING.

    (a) AMENDMENT OF PURPA- The Public Utility Regulatory Policies Act of 1978 (16 U.S.C. 2601 and following) is amended by adding the following new section after section 215, as added by section 5 of this Act:

‘SEC. 216. NET METERING FOR RENEWABLE ENERGY.

    ‘(a) DEFINITIONS- For purposes of this section--

      ‘(1) The term ‘eligible on-site generating facility’ means a facility on the site of an electric consumer with a peak generating capacity of 100 kilowatts or less that is fueled solely by a renewable energy resource.

      ‘(2) The term ‘renewable energy resource’ means solar energy, wind, geothermal, or biomass.

      ‘(3) The term ‘net metering service’ means service to an electric consumer under which electricity generated by that consumer from an eligible on-site generating facility and delivered to the distribution system through the same meter through which purchased electricity is received may be used to offset electricity provided by the retail electric supplier to the electric consumer during the applicable billing period so that an electric consumer is billed only for the net electricity consumer during the billing period, but in no event shall the net be less than zero during the applicable billing period.

    ‘(b) REQUIREMENT TO PROVIDE NET METERING SERVICE- Each retail electric supplier shall make available upon request net metering service to any retail electric consumer that the supplier currently serves or solicits for service.

    ‘(c) STATE AUTHORITY- This section does not preclude a State from imposing additional requirements consistent with the requirements in this section, including the imposition of a cap limiting the amount of net metering available in the State. Nothing in this Act or any other Federal law preempts or otherwise affects authority under State law to require a retail electric supplier to make available net metering service to a retail electric consumer which the supplier serves or offers to serve.’.

    (c) TABLE OF CONTENTS- The table of contents for title II of the Public Utility Regulatory Policies Act of 1978 (16 U.S.C. 2601 and following) is amended by adding the following at the end thereof:

      ‘Sec. 216. Net metering for renewable energy.’.