Bill Summary – FastDemocracy

HOUSE BILL NO. 4761
     June 14, 2023, Introduced by Reps. Aiyash, Farhat, Hoskins, O'Neal, Puri, Byrnes, Mentzer,
        Rheingans, Arbit, Morse, Hope, Wegela, Young, Price, McKinney, Glanville, Brixie,
        MacDonell, Tyrone Carter, Breen, Stone, Churches, Conlin, Hood, Weiss, Hill, Morgan,
        Wilson, McFall, Edwards, Rogers, Paiz, Martus, Pohutsky and Whitsett and referred to the
        Committee on Energy, Communications, and Technology.
          A bill to amend 2008 PA 295, entitled
    "Clean and renewable energy and energy waste reduction act,"
    by amending sections 1, 7, 9, 13, 22, 71, 73, 75, 77, and 78 (MCL
1001, 460.1007, 460.1009, 460.1013, 460.1022, 460.1071,
1073, 460.1075, 460.1077, and 460.1078), sections 1, 7, 9, 13,
    71, 73, 75, and 77 as amended and sections 22 and 78 as added by
PA 342, and by adding sections 80, 80a, and 80b.
                     THE PEOPLE OF THE STATE OF MICHIGAN ENACT:
       Sec. 1. (1) This act shall be known and may be cited as the
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 "clean and renewable energy and energy waste reduction act".
       (2) The purpose of this act is to promote the development and
 use of clean and renewable energy resources and the reduction of
 energy waste through programs that will cost-effectively do all of
 the following:
       (a) Diversify the resources used to reliably meet the energy
 needs of consumers in this state.
       (b) Provide greater energy security through the use of
 indigenous energy resources available within the state.
       (c) Encourage private investment in renewable energy and
 energy waste reduction.
       (d) Coordinate with federal regulations to provide improved
 air quality and other benefits to energy consumers and citizens of
 this state.
       (e) Remove unnecessary burdens on the appropriate use of solid
 waste as a clean energy source.
       (3) As a goal, not less than 35% of this state's electric
 needs should be met through a combination of energy waste reduction
 and renewable energy by 2025, if the investments in energy waste
 reduction and renewable energy are the most reasonable means of
 meeting an electric utility's energy and capacity needs relative to
 other resource options. Both of the following count toward
 achievement of the goal:
       (a) All renewable energy, including renewable energy credits
 purchased or otherwise acquired with or without the associated
 renewable energy, and any banked renewable energy credits, that
 counted toward the renewable energy standard on the effective date
 of the 2016 amendatory act that added this subsection, as well as
 renewable energy credits granted as a result of any investments
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 made in renewable energy by the utility or a utility customer after
 that effective date.
       (b) The sum of the annual electricity savings since October 6,
 2008, as recognized by the commission through annual reconciliation
 proceedings, that resulted from energy waste reduction measures
 implemented under an energy optimization plan or energy waste
 reduction plan approved under section 73.
       Sec. 7. As used in this act:
       (a) "Gasification facility" means a facility located in this
 state that, using a thermochemical process that does not involve
 direct combustion, produces synthesis gas, composed of carbon
 monoxide and hydrogen, from carbon-based feedstocks, (such as coal,
 petroleum coke, wood, biomass, hazardous waste, medical waste,
 industrial waste, and solid waste, including, but not limited to,
 municipal solid waste, electronic waste, and waste described in
 section 11514 of the natural resources and environmental protection
 act, 1994 PA 451, MCL 324.11514, ) and that uses the synthesis gas
 or a mixture of the synthesis gas and methane to generate
 electricity for commercial use. Gasification facility includes the
 transmission lines, gas transportation lines and facilities, and
 associated property and equipment specifically attributable to such
 a facility. Gasification facility includes, but is not limited to,
 an integrated gasification combined cycle facility and a plasma arc
 gasification facility.
       (b) "Incremental costs of compliance" means the net revenue
 required by an electric provider to comply with the renewable
 energy standard, calculated as provided under section 47.
       (c) "Independent transmission company" means that term as
 defined in section 2 of the electric transmission line
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 certification act, 1995 PA 30, MCL 460.562.
       (d) "Integrated gasification combined cycle facility" means a
 gasification facility that uses a thermochemical process, including
 high temperatures and controlled amounts of air and oxygen, to
 break substances down into their molecular structures and that uses
 exhaust heat to generate electricity.
       (e) "Integrated pyrolysis combined cycle facility" means a
 pyrolysis facility that uses exhaust heat to generate electricity.
       (f) "LEED" means the leadership in energy and environmental
 design green building rating system developed by the United States
 Green Building Council.
       (g) "Load management" means measures or programs that target
 equipment or behavior to result in decreased peak electricity
 demand such as by shifting demand from a peak to an off-peak
 period.
       (h) "Low-income customer" means a customer whose household
 income does not exceed 200% of the federal poverty level, as
 published by the United States Department of Health and Human
 Services under its authority to revise the poverty line under 42
 USC 9902, or who is enrolled in any federal, state, or local
 program with similar income eligibility requirements, including,
 but not limited to, any of the following:
       (i) Assistance from a state emergency relief program.
       (ii) Food assistance programs.
       (iii) Medicaid.
       (i) (h) "Megawatt", "megawatt hour", or "megawatt hour of
 electricity", unless the context implies otherwise, includes the
 steam equivalent of a megawatt or megawatt hour of electricity.
       (j) (i) "Modified net metering" means a utility billing method
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 that applies the power supply component of the full retail rate to
 the net of the bidirectional flow of kilowatt hours across the
 customer interconnection with the utility distribution system,
 during a billing period or time-of-use pricing period. A negative
 net metered quantity during the billing period or during each time-
 of-use pricing period within the billing period reflects net excess
 generation for which the customer is entitled to receive credit
 under section 177(4). Under modified net metering, standby charges
 for distributed generation customers on an energy rate schedule
 shall must be equal to the retail distribution charge applied to
 the imputed customer usage during the billing period. The imputed
 customer usage is calculated as the sum of the metered on-site
 generation and the net of the bidirectional flow of power across
 the customer interconnection during the billing period. The
 commission shall establish standby charges under modified net
 metering for distributed generation customers on demand-based rate
 schedules that provide an equivalent contribution to utility system
 costs. A charge for net metering and distributed generation
 customers established pursuant to section 6a of 1939 PA 3, MCL
 460.6a, shall must not be recovered more than once. This
 subdivision is subject to section 177(5).
       Sec. 9. As used in this act:
       (a) "Natural gas provider" means an investor-owned business
 engaged in the sale and distribution at retail of natural gas
 within this state whose rates are regulated by the commission.
       (b) "Pet coke" means a solid carbonaceous residue produced
 from a coker after cracking and distillation from petroleum
 refining operations.
       (c) "Plasma arc gasification facility" means a gasification
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 facility that uses a plasma torch to break substances down into
 their molecular structures.
         (d) "Provider" means an electric provider or a natural gas
 provider.
         (e) "PURPA" means the public utility regulatory policies act
 of 1978, Public Law 95-617.
         (f) "Pyrolysis facility" means a facility that effects
 thermochemical decomposition at elevated temperatures without the
 participation of oxygen, from carbon-based feedstocks including,
 but not limited to, coal, wood, biomass, industrial waste, or solid
 waste, but not including pet coke, hazardous waste, coal waste, or
 scrap tires. Pyrolysis facility includes the transmission lines,
 gas transportation lines and facilities, and associated property
 and equipment specifically attributable to the facility. Pyrolysis
 facility includes, but is not limited to, an integrated pyrolysis
 combined cycle facility.
         (g) "Qualifying high-efficiency electrification measures"
 means electric appliances or equipment installed in an existing
 home or building to convert energy usage from fossil fuels to
 electricity, and that meet appropriate standards for high energy
 efficiency. These standards may be added to or modified, with
 exceptions as appropriate, by the commission to reflect industry
 changes and best practices regarding cost-effective efficiency.
 Examples include, but are not limited to, any of the following:
         (i) "Qualifying ground source heat pumps", which are ground
 source heat pumps that meet the standard of Energy Star Geothermal
 v3.2.
         (ii) "Qualifying high-efficiency clothes dryers", which are
 dryers that meet Energy Star standards.
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       (iii) "Qualifying high-efficiency cold climate heat pumps",
 which are air source heat pumps that meet the standard of Energy
 Star Cold Climate v6.1.
       (iv) "Qualifying high-efficiency cooking equipment", which
 includes cooktops and stovetops with induction heating technology.
       (v) "Qualifying water heaters", which are water heaters that
 meet the Energy Star standards for residential water heaters.
       Sec. 13. As used in this act:
       (a) "Site" means a contiguous site, regardless of the number
 of meters at that site. A site that would be contiguous but for the
 presence of a street, road, or highway is considered to be
 contiguous for the purposes of this subdivision.
       (b) "Transmission line" means all structures, equipment, and
 real property necessary to transfer electricity at system bulk
 supply voltage of 100 kilovolts or more.
       (c) "True net metering" means a utility billing method that
 applies the full retail rate to the net of the bidirectional flow
 of kilowatt hours across the customer interconnection with the
 utility distribution system, during a billing period or time-of-use
 pricing period. A negative net metered quantity during the billing
 period or during each time-of-use pricing period within the billing
 period reflects net excess generation for which the customer is
 entitled to receive credit under section 177(4). This subdivision
 is subject to section 177(5).
       (d) "Utility system resource cost test" means a standard that
 is met for an investment in energy waste reduction if, on a life
 cycle basis , using a real societal discount rate based on actual
 long-term treasury bond yields, the sum of A and B is greater than
 C, where:
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       (i) A equals the total avoided supply-side costs to the
 provider, including representative values for electricity or
 natural gas supply, transmission, distribution, and other
 associated costs. , are greater than the
       (ii) B equals the number of tons of reduced emissions in carbon
 dioxide equivalents multiplied by $100.00 per ton, adjusted
 annually for inflation using the Consumer Price Index. As used in
 this subparagraph, "Consumer Price Index" means the most
 comprehensive index of consumer prices available for this state
 from the United States Department of Labor, Bureau of Labor
 Statistics.
       (iii) C equals the total costs to the provider of administering
 and delivering the energy waste reduction program, including net
 costs for any provider incentives paid by customers and capitalized
 costs recovered under section 89.
       (e) "Wind energy conversion system" means a system that uses 1
 or more wind turbines to generate electricity and has a nameplate
 capacity of 100 kilowatts or more.
       (f) "Wind energy resource zone" or "wind zone" means an area
 designated by the commission under section 147.
       Sec. 22. (1) Renewable energy plans and associated revenue
 recovery mechanisms filed by an electric provider, approved under
 former section 21 or 23 or found to comply with this act under
 former section 25 and in effect on the effective date of the 2016
 amendatory act that added this section, April 20, 2017, remain in
 effect, subject to amendments as provided for under subsections (3)
 and (4).
       (2) For an electric provider whose rates are regulated by the
 commission, amended renewable energy plans shall must establish a
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 nonvolumetric mechanism for the recovery of the incremental costs
 of compliance within the electric provider's customer rates. The
 revenue recovery mechanism shall must not result in rate impacts
 that exceed the monthly maximum retail rate impacts specified under
 section 45. The revenue recovery mechanism is subject to adjustment
 under sections 47(4) and 49.
        (3) Within 1 year after the effective date of the 2016
 amendatory act that added this section, Not later than April 20,
 2018, the commission shall review each electric provider's
 renewable energy plan pursuant to a filing schedule established by
 the commission. For an electric provider whose rates are regulated
 by the commission, the commission shall conduct a contested case
 hearing on the renewable energy plan pursuant to the administrative
 procedures act of 1969, 1969 PA 306, MCL 24.201 to 24.328. After
 the hearing, the commission shall approve, with any changes
 consented to by the electric provider, or reject the renewable
 energy plan and any amendments to the renewable energy plan. For
 all other electric providers, the commission shall provide an
 opportunity for public comment on the renewable energy plan. After
 the applicable opportunity for public comment, the commission shall
 determine whether any amendment to the renewable energy plan
 proposed by the provider complies with this act. For alternative
 electric suppliers, the commission shall approve, with any changes
 consented to by the electric provider, or reject any proposed
 amendments to the renewable energy plan. For cooperative electric
 utilities and municipally owned utilities, the proposed amendment
 is adopted if the commission determines that it complies with this
 act.
        (4) If an electric provider proposes to amend its renewable
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 energy plan after the review process under subsection (3), the
 electric provider shall must file the proposed amendment with the
 commission. For an electric provider whose rates are regulated by
 the commission, if the proposed amendment would modify the revenue
 recovery mechanism, the commission shall must conduct a contested
 case hearing on the amendment pursuant to in accordance with the
 administrative procedures act of 1969, 1969 PA 306, MCL 24.201 to
 24.328. After the hearing and within 90 days after the amendment is
 filed, the commission shall approve, with any changes consented to
 by the electric provider, or reject the renewable energy plan and
 the proposed amendment or amendments to the renewable energy plan.
 For all other electric providers, the commission shall provide an
 opportunity for public comment on the amendment. After the
 applicable opportunity for public comment and within 90 days after
 the amendment is filed, the commission shall determine whether the
 proposed amendment to the renewable energy plan complies with this
 act. For alternative electric suppliers, the commission shall
 approve, with any changes consented to by the electric provider, or
 reject any proposed amendments to the renewable energy plan. For
 cooperative electric utilities and municipally owned