Bill Summary – FastDemocracy

H-0175.1
                                HOUSE BILL 1046
     State of Washington       67th Legislature       2021 Regular Session
     By   Representatives Bateman,  Duerr,  Leavitt,  Shewmake, Kloba,
     Fitzgibbon, Dolan, Ramos, Ramel, Gregerson, Goodman, Ryu, Callan,
     Paul, Morgan, Riccelli, Pollet, Santos, Macri, Davis, and Harris-
     Talley
     Prefiled 12/22/20. Read first time 01/11/21.    Referred to Committee
     on Environment & Energy.
      AN ACT Relating to community solar programs; amending RCW
  80.28.370 and 80.28.375; and adding a new section to chapter 80.28
  RCW.
 BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF WASHINGTON:
     Sec. 1.   RCW 80.28.370 and 2017 3rd sp.s. c 36 s 10 are each
 amended to read as follows:
     The definitions in this section apply throughout this section
 ((and)), RCW 80.28.375, and section 2 of this act unless the context
 clearly requires otherwise.
     (1) (("Community solar company" means a person, firm, or
 corporation, other than an electric utility or a community solar
 cooperative, that owns a community solar project and provides
 community solar project services to project participants.
     (2))) "Community solar project" means ((a solar energy system
 that has a direct current nameplate generating capacity that is no
 larger than one thousand kilowatts)) one or more solar energy systems
 that provide project participants the opportunity to share the costs
 and benefits associated with the generation of electricity by solar
 energy systems.
     (2) "Community solar project manager" means the entity identified
 as having responsibility for managing the operation of a community
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 solar project and, if applicable, for maintaining contact with the
 investor-owned utility that procures electricity from the community
 solar project. A community solar project manager may be:
     (a) An investor-owned utility; or
     (b) An independent third party.
     (3) "Community solar project services" means the provision of
 electricity generated by a community solar project, or the provision
 of the financial benefits associated with electricity generated by a
 community solar project, to multiple project participants, and may
 include other services associated with the use of the community solar
 project   such  as   system  monitoring   and  maintenance,   warranty
 provisions, performance guarantees, and customer service.
     (4) "Electric utility" means a consumer-owned utility or
 investor-owned utility as those terms are defined in RCW 19.280.020.
     (5) "Investor-owned utility" has the same meaning as defined in
 RCW 19.280.020.
     (6) "Low-income" has the same meaning as defined in RCW
 19.405.020.
     (7) "Low-income service provider" includes, but is not limited
 to, a local community action agency or local community service agency
 designated by the department of commerce under chapter 43.63A RCW, a
 local housing authority, a tribal housing authority, a low-income
 tribal housing program, an affordable housing provider, a food bank,
 or other nonprofit organization whose primary service supports low-
 income households.
     (8) "Project participant" means a customer who enters into a
 lease, power purchase agreement, loan, direct ownership, or other
 financial agreement with a community solar company in order to obtain
 a beneficial interest in((, other than direct ownership of,)) a
 community solar project.
     (((6))) (9) "Solar energy system" means any device or combination
 of devices or elements that rely upon direct sunlight as an energy
 source for use in the generation of electricity.
     (10) "Unsubscribed energy" means the electricity generated by a
 community solar project that is not subscribed to by a project
 participant.
     NEW SECTION.   Sec. 2.   A new section is added to chapter 80.28
 RCW to read as follows:
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     (1)(a) The commission shall adopt by rule a program for the
 procurement of electricity from community solar projects. As part of
 this program the commission shall:
     (i) Adopt rules prescribing what qualifies a community solar
 project to participate in the program;
     (ii) Prescribe the form and manner by which project managers may
 apply for certification and the form and manner by which qualified
 community solar projects receive certification for participation in
 the program;
     (iii) Require, by rule or order, investor-owned utilities to
 enter into a 20 year or longer power purchase agreement with a
 certified community solar project;
     (iv) Determine a methodology by which 40 percent of the total
 program generating capacity is made available for use by low-income
 consumers and low-income service provider consumers of electricity;
 and
     (v) Periodically review and adjust the program described in this
 subsection.
     (b) The commission shall adopt rules under (a) of this subsection
 that, at a minimum:
     (i) Minimize the shifting of costs from the program to ratepayers
 that do not own or participate in a community solar project;
     (ii)   Incentivize  consumers   of  electricity   to  be   project
 participants;
     (iii) Protect project participants from undue financial hardship;
 and
     (iv) Protect the public interest.
     (c) The commission may suspend the program adopted under this
 subsection if the commission has good cause to suspend the program.
     (2) A community solar project must include at least one solar
 energy system located in this state.
     (3) A community solar project manager may offer ownership in or
 participation in a community solar project only to consumers of
 electricity that are:
     (a) In this state; and
     (b) A customer of the electric utility where the community solar
 project is located.
     (4)(a) A community solar project manager may offer proportional
 ownership in or proportional participation in a community solar
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 project in any amount that does not exceed a potential project
 participant's average annual consumption of electricity.
     (b) Any value associated with the generation of electricity in
 excess of a project participant's annual consumption as limited by
 (a) of this subsection must be, on March 31st of each calendar year,
 used by the investor-owned utility procuring electricity from the
 community solar project in support of low-income customers or low-
 income service provider customers.
     (5)(a) The commission may adopt a rate for an investor-owned
 utility to use in crediting a project participant's electric bill. An
 investor-owned utility shall credit a project participant's electric
 bill for electricity generated by a community solar project for the
 project participant.
     (b) The commission may adopt a rate for the investor-owned
 utility's purchase of unsubscribed energy from a community solar
 project manager.
     (6)(a)   All  start-up   costs   prudently  incurred  during   the
 development or modification of the program established under this
 section are recoverable in the rates of an investor-owned utility.
     (b) Except as otherwise provided in this section, project
 participants bear the costs and benefits of constructing and
 operating a community solar project.
     (c) Costs incurred by an investor-owned utility under the terms
 of a power purchase agreement entered into pursuant to subsection
 (1)(a)(iii) of this section are recoverable in the rates of an
 investor-owned utility. Moneys collected pursuant to imposing those
 rates, under the terms of a power purchase agreement entered into
 pursuant to subsection (1)(a)(iii) of this section, may be
 transferred to a community solar project manager for the purpose of
 operating a community solar project.
     (7) All renewable energy certificates that are associated with
 the generation of electricity by a community solar project are either
 owned by the investor-owned utility or retired on behalf of the
 project participant.
     Sec. 3.   RCW 80.28.375 and 2017 3rd sp.s. c 36 s 11 are each
 amended to read as follows:
     (1) No community solar ((company)) project manager may engage in
 business in this state except in accordance with the provisions of
 this chapter. Engaging in business as a community solar company
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 includes advertising, soliciting, offering, or entering into an
 agreement to own a community solar project and provide community
 solar project services to electric utility customers.
     (2) ((A community solar company must register with the commission
 before engaging in business in this state or applying for
 certification from the Washington State University extension energy
 program under RCW 82.16.165(1).)) Registration with the commission as
 a community solar ((company)) project manager must occur on an annual
 basis. The registration must be on a form prescribed by the
 commission and contain that information as the commission may by rule
 require, but must include at a minimum:
     (a) The name and address of the community solar ((company))
 project manager;
     (b) The name and address of the community solar ((company's))
 project manager's registered agent, if any;
     (c) The name, address, and title of each officer or director;
     (d) The community solar ((company's)) project manager's most
 current balance sheet;
     (e) The community solar ((company's)) project manager's latest
 annual report, if any;
     (f) A description of the services the community solar ((company))
 project manager offers or intends to offer, including financing
 models; and
     (g) Disclosure of any pending litigation against it.
     (3) As a precondition to registration, the commission may require
 the procurement of a performance bond or other mechanism sufficient
 to cover any advances or deposits the community solar ((company))
 project manager may collect from project participants or order that
 the advances or deposits be held in escrow or trust.
     (4) The commission may deny registration to any community solar
 ((company)) project manager that:
     (a) Does not provide the information required by this section;
     (b) Fails to provide a performance bond or other mechanism, if
 required;
     (c) Does not possess adequate financial resources to provide the
 proposed service; or
     (d) Does not possess adequate technical competency to provide the
 proposed service.
     (5) The commission must take action to approve or issue a notice
 of hearing concerning any application for registration within thirty
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 days after receiving the application. The commission may approve an
 application with or without a hearing. The commission may deny an
 application after a hearing.
     (6) The commission may charge a community solar ((company))
 project manager an annual application fee to recover the cost of
 processing applications for registration under this section.
     (7) The commission may adopt rules that describe the manner by
 which it will register a community solar ((company)) project manager,
 ensure that the terms and conditions of community solar projects or
 community solar project services comply with the requirements of
 chapter 36, Laws of 2017 3rd sp. sess., establish the community solar
 ((company's)) project manager's responsibilities for responding to
 customer complaints and disputes, and adopt annual reporting
 requirements. In addition to the application fee authorized under
 subsection (6) of this section, the commission may adopt regulatory
 fees applicable to community solar companies pursuant to RCW
 80.04.080, 80.24.010, and 80.24.020. Such fees may not exceed the
 cost of ensuring compliance with this chapter.
     (8) The commission may suspend or revoke a registration upon
 complaint by any interested party, or upon the commission's own
 motion after notice and opportunity for hearing, when it finds that a
 registered community solar ((company)) project manager or its agent
 has violated this chapter or the rules of the commission, or that the
 community solar ((company)) project manager or its agent has been
 found by a court or governmental agency to have violated the laws of
 a state or the United States.
     (9) For the purpose of ensuring compliance with this chapter, the
 commission may issue penalties against community solar ((companies))
 project managers for violations of this chapter as provided for
 public service companies pursuant to chapter 80.04 RCW.
     (10) Upon request of the commission, a community solar
 ((company)) project manager registered under this section must
 provide information about its community solar projects or community
 solar project services.
     (11) A violation of this section constitutes an unfair or
 deceptive act in trade or commerce in violation of chapter 19.86 RCW,
 the consumer protection act. Acts in violation of chapter 36, Laws of
 2017 3rd sp. sess. are not reasonable in relation to the development
 and preservation of business, and constitute matters vitally
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 affecting the public interest for the purpose of applying the
 consumer protection act, chapter 19.86 RCW.
     (12) For the purposes of RCW 19.86.170, actions or transactions
 of a community solar ((company)) project manager may not be deemed
 otherwise permitted, prohibited, or regulated by the commission.
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Statutes affected: 
Bill: 80.28.370, 80.28.375