A bill for an act
relating to energy; establishing a loan program for municipal utilities paying
unusually high prices for natural gas in February 2021; establishing a program to
defray high natural gas bills from the February 2021 price spike for low-income
households; appropriating money.
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MINNESOTA:
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(a) For the purposes of this section, the following terms have
the meanings given.
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(b) "Commissioner" means the commissioner of commerce.
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(c) "Critical period" means the period beginning February 12, 2021, and ending February
17, 2021.
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(d) "Incremental cost" means the average unit price a utility paid for natural gas purchased
for immediate delivery during the critical period, minus the average natural gas unit price
for wholesale natural gas the utility paid during the period between February 5, 2021, and
February 10, 2021.
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(e) "Incremental volume" means the difference between the volume of gas a utility
purchased for immediate delivery in Minnesota during the critical period and the volume
of gas a utility distributed in Minnesota between February 5, 2021, and February 10, 2021.
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(f) "Spot price" means the price paid per unit for an immediate delivery of natural gas.
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(g) "Utility" means a nonprofit municipal utility established under Minnesota Statutes,
chapter 412, that (1) is owned by the city to which it provides service, and (2) sells natural
gas to retail customers in Minnesota.
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The 2021 polar vortex loan account
is established in a special revenue fund. The commissioner must manage the account. Money
in the account may be used to make loans under this section and to pay the reasonable costs
incurred to administer this section.
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The 2021 polar vortex loan account is established to alleviate cash
flow problems experienced by Minnesota municipal gas utilities that purchased natural gas
supplies for immediate delivery at unusually high prices during the extreme cold weather
in February 2021.
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A utility that purchased natural gas for immediate delivery
during the critical period to distribute the natural gas to Minnesota retail natural gas customers
is eligible to receive a loan under this section.
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(a) An applicant for a loan under this section must file an
application with the commissioner on a form developed by the commissioner. The application
must require an applicant to supply:
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(1) the utility's incremental cost and incremental volume;
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(2) evidence indicating the prices and volumes of natural gas purchased by the utility
during the critical period that the utility used to calculate the utility's incremental cost and
incremental volume; and
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(3) any additional information required by the commissioner.
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(b) The commissioner must develop procedures governing the filing of applications,
review of applications, and awarding of loans under this section.
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(a) A loan made under this section must be
a zero-interest loan with a term not exceeding five years.
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(b) The commissioner must determine the amount of a loan based on the information
provided in an application filed under this section. A utility's loan must not exceed the
utility's incremental cost multiplied by its incremental volume. The commissioner may
reduce the amount of loans proportionately if the demand for loan assistance exceeds the
funds available for loans.
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(c) Loan principal repayments must be made to the commissioner. The commissioner
must deposit money received from loan principal repayments in the general fund.
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(a) A utility awarded a loan under this section must use the
loan funds to pay for natural gas purchased during the critical period for immediate delivery.
The utility must submit to the commissioner evidence that the full loan amount was used
to pay for natural gas as provided in this section. The evidence must be submitted to the
commissioner within ten days of the date the payment was made.
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(b) A utility that is issued a loan under this section and that also receives funding from
another source that is meant to be used for the purpose described in subdivision 3 must
remit an amount equal to the additional funding received to the commissioner within ten
days of the date the utility received the additional funding or received a loan under this
section, whichever is later.
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This section is effective the day following final enactment.
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(a) For the purposes of this section, the following terms have
the meanings given.
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(b) "Commission" means the Public Utilities Commission.
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(c) "Commissioner" means the commissioner of commerce.
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(d) "Cooperative association" means a cooperative association organized under Minnesota
Statutes, chapter 308A, that sells natural gas to retail customers in Minnesota.
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(e) "Critical period" means the period beginning February 12, 2021, and ending February
17, 2021.
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(f) "Eligible low-income household" means a Minnesota residential household that
consumed natural gas for space heating during the critical period and, as determined by the
utility providing natural gas service to the household:
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(1) receives federal heating assistance under LIHEAP;
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(2) is participating in a payment agreement with the utility under Minnesota Statutes,
section 216B.096, 216B.097, or 216B.098; or
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(3) has missed two or more utility bill payments or submitted two or more partial utility
bill payments since October 2020.
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(g) "Incremental price of gas" means the difference between the average per unit price
a utility paid for natural gas purchased for immediate delivery during the critical period and
the average unit price the utility paid for wholesale natural gas delivered to a customer
between February 5, 2021, and February 10, 2021.
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(h) "Incremental consumption" means the amount of natural gas a customer consumed
during the critical period, minus the amount of gas the same customer consumed between
February 5, 2021, and February 10, 2021.
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(i) "LIHEAP" means the low-income home energy assistance program under United
States Code, title 42, sections 8621 to 8630, and Minnesota Statutes, section 216C.02,
subdivision 1.
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(j) "Municipal utility" means a nonprofit utility established under Minnesota Statutes,
chapter 412, that (1) is owned by the city to which it provides service, and (2) sells natural
gas to retail customers in Minnesota.
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(k) "Public utility" means a public utility, as defined in Minnesota Statutes, section