House File 475 - Introduced
HOUSE FILE
BY KELLEY
A BILL FOR
1 An Act relating to alternate energy by allowing the
2 establishment of community solar garden projects.
3 BE IT ENACTED BY THE GENERAL ASSEMBLY OF THE STATE OF IOWA:
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PAG LIN
1 1 Section 1. Section 476.1, Code 2015, is amended by adding
1 2 the following new subsection:
1 3 NEW SUBSECTION. 5A. A community solar garden project
1 4 established pursuant to section 476.49 shall not be regarded as
1 5 a public utility for purposes of this chapter.
1 6 Sec. 2. Section 476.25, Code 2015, is amended by adding the
1 7 following new unnumbered paragraph:
1 8 NEW UNNUMBERED PARAGRAPH The furnishing of electricity
1 9 pursuant to a community solar garden project under section
1 10 476.49 shall not be considered an unnecessary duplication
1 11 of electric utility facilities and shall not constitute a
1 12 violation of this section.
1 13 Sec. 3. NEW SECTION. 476.49 Community solar garden
1 14 projects.
1 15 1. Definitions. For purposes of this section, unless the
1 16 context otherwise requires:
1 17 a. "Community solar garden project" means an electric
1 18 generating facility with a nameplate generating capacity of
1 19 two megawatts or less that generates electricity by means of a
1 20 ground=mounted or roof=mounted solar photovoltaic device and
1 21 that is comprised of a minimum of five subscribers who jointly
1 22 share the beneficial use of the electricity generated by the
1 23 project.
1 24 b. "Subscriber" means a retail customer of an electric
1 25 utility subject to this division who owns a subscription and
1 26 who has identified one or more physical locations to which the
1 27 subscription shall be attributed or attached.
1 28 c. "Subscription" means a proportional interest in a
1 29 community solar garden project, together with a proportional
1 30 interest in any state or federal tax credits for which the
1 31 facility associated with the project may be eligible.
1 32 2. Program established.
1 33 a. A community solar garden project may be established
1 34 to encourage and enhance the ability of electric utility
1 35 customers to participate in and derive benefit from solar
2 1 energy projects.
2 2 b. A community solar garden project established pursuant to
2 3 this section shall be subject to the following requirements and
2 4 specifications:
2 5 (1) A project may be established by an electric utility
2 6 or any other for=profit or nonprofit entity or organization,
2 7 including a subscriber organization whose sole purpose shall be
2 8 beneficially owning and operating the project. Additionally,
2 9 a project may be constructed, owned, and operated by a third
2 10 party under contract with a subscriber organization and
2 11 pursuant to a lease, sale=leaseback transaction, operating
2 12 agreement, or other third=party ownership arrangement.
2 13 (2) Physical locations to which subscriptions are
2 14 attributed or attached shall be located within the same county
2 15 or municipality and within the same electric utility service
2 16 area. Each subscription shall represent at least one kilowatt
2 17 of the community solar garden project's generating capacity and
2 18 shall supply no more than one hundred twenty percent of the
2 19 average annual consumption of electricity by each subscriber
2 20 at the premises to which the subscription is attributed or
2 21 attached. Subscriptions may be transferred or assigned to a
2 22 subscriber organization or to any person or entity otherwise
2 23 qualifying as a subscriber pursuant to this section, and may
2 24 be continued following relocation of a subscriber to another
2 25 location within the same county or municipality and electric
2 26 utility service area otherwise meeting the requirements of this
2 27 section. A subscription following relocation may be subject
2 28 to adjustment to reflect any differences between the new and
2 29 previous premises' electricity usage rate. The board shall
2 30 determine transfer, assignment, and relocation criteria by
2 31 rule.
2 32 (3) Electricity generated pursuant to the project shall
2 33 be aggregated and then proportionately allocated to each
2 34 subscriber. Excess electricity generated by the project not
2 35 utilized at the premises to which a subscription is attributed
3 1 or attached may be sold pursuant to a power purchase agreement
3 2 entered into with the electric utility at the same rates
3 3 applicable to alternate energy production facilities pursuant
3 4 to section 476.43.
3 5 (4) Notwithstanding the maximum purchase and ownership
3 6 restrictions contained in section 476.44, an electric utility
3 7 subject to this division shall enter into one or more power
3 8 purchase agreements with one or more projects to purchase a
3 9 minimum of five hundred kilowatts of electricity annually. The
3 10 board may by rule adjust this requirement on or after July 1,
3 11 2018.
3 12 (5) Federal or state tax credits for which the community
3 13 solar garden facility associated with the project qualifies
3 14 shall be proportionately allocated to each subscriber.
3 15 3. Rules. The board shall adopt rules governing the
3 16 establishment of community solar garden projects pursuant to
3 17 this section.
3 18 EXPLANATION
3 19 The inclusion of this explanation does not constitute agreement with
3 20 the explanation's substance by the members of the general assembly.
3 21 This bill allows the establishment of community solar garden
3 22 projects.
3 23 The bill defines a "community solar garden project" to
3 24 mean a facility with a nameplate generating capacity of two
3 25 megawatts or less that generates electricity by means of a
3 26 ground=mounted or roof=mounted solar photovoltaic device and
3 27 that is comprised of a minimum of five subscribers who jointly
3 28 share the beneficial use of the electricity generated by the
3 29 project. The bill defines a "subscriber" to mean a retail
3 30 customer of an electric utility who owns a subscription and
3 31 who has identified one or more physical locations to which the
3 32 subscription shall be attributed or attached. The bill defines
3 33 a "subscription" to mean a proportional interest in a community
3 34 solar garden project, together with a proportional interest
3 35 in any tax credits for which the facility associated with the
4 1 project may be eligible.
4 2 The bill states that the objective of a project shall be to
4 3 encourage and enhance the ability of public utility customers
4 4 to participate in and derive benefit from solar energy
4 5 projects.
4 6 Regarding project ownership, the bill provides that
4 7 a project may be established by an electric or any other
4 8 for=profit or nonprofit entity or organization, including a
4 9 subscriber organization whose sole purpose is to beneficially
4 10 own and operate the project. A project can also be
4 11 constructed, owned, and operated by a third party under
4 12 contract with a subscriber organization and pursuant to a
4 13 lease, sale=leaseback transaction, operating agreement, or
4 14 other third=party ownership arrangement.
4 15 The bill provides that physical locations to which
4 16 subscriptions are attributed or attached must be located within
4 17 the same county or municipality and within the same electric
4 18 utility service area. The bill states that each subscription
4 19 shall represent at least one kilowatt of a project's generating
4 20 capacity and shall supply no more than 120 percent of the
4 21 average annual consumption of electricity by each subscriber
4 22 at the premises to which the subscription is attributed or
4 23 attached. The bill authorizes the transfer, assignment, or
4 24 relocation of subscriptions, under conditions to be determined
4 25 by the board by rule.
4 26 The bill states that electricity generated pursuant to
4 27 a project shall be aggregated and then proportionately
4 28 allocated to each subscriber, and that excess electricity
4 29 generated by the project not utilized at the premises to which
4 30 a subscription is attributed may be sold pursuant to a power
4 31 purchase agreement entered into with the electric utility
4 32 at the same rates applicable to alternate energy production
4 33 facilities pursuant to Code section 476.43.
4 34 The bill imposes purchase requirements on electric
4 35 utilities. The bill states that an electric utility shall
5 1 enter into one or more power purchase agreements with one
5 2 or more projects to purchase a minimum of 500 kilowatts of
5 3 electricity annually. The bill provides that the board may by
5 4 rule adjust this requirement on or after July 1, 2018, and that
5 5 subscribers shall qualify for the federal and state tax credits
5 6 for which the community solar garden facility qualifies on a
5 7 proportionate basis.
5 8 The bill provides that a community solar garden project
5 9 shall not be considered a public utility subject to the
5 10 regulatory provisions of Code chapter 476, and that such a
5 11 project does not violate provisions contained in Code chapter
5 12 476 prohibiting the unnecessary duplication of electric utility
5 13 facilities.
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