(REPRINTED WITH ADOPTED AMENDMENTS)
SECOND REPRINT S.B. 372
Senate Bill No. 372–Committee on Commerce and Labor
March 16, 2001
____________
Referred to Committee on Commerce and Labor
SUMMARY—Revises provisions concerning conservation of energy and use of renewable energy. (BDR 58‑287)
FISCAL NOTE: Effect on Local Government: Yes.
~
EXPLANATION
– Matter in bolded italics is new; matter
between brackets [omitted material] is material to be omitted.
Green numbers along left margin indicate location on the printed bill (e.g., 5-15 indicates page 5, line 15).
THE PEOPLE OF THE STATE OF NEVADA, REPRESENTED IN
SENATE AND ASSEMBLY, DO ENACT AS FOLLOWS:
1-1 Section 1. NRS 703.147 is hereby amended to read as follows:
1-2 703.147 1. The public utilities commission regulatory fund is hereby
1-3 created as a special revenue fund. [All] Except as otherwise provided in
1-4 section 12 of this act, all money collected by the commission pursuant to
1-5 law must be deposited in the state treasury for credit to the fund. Money
1-6 collected for the use of the consumer’s advocate of the bureau of
1-7 consumer protection in the office of the attorney general must be
1-8 transferred pursuant to the provisions of subsection 8 of NRS 704.035.
1-9 2. Money in the fund which belongs to the commission may be used
1-10 only to defray the costs of:
1-11 (a) Maintaining staff and equipment to regulate adequately public
1-12 utilities and other persons subject to the jurisdiction of the commission.
1-13 (b) Participating in all rate cases involving those persons.
1-14 (c) Audits, inspections, investigations, publication of notices, reports
1-15 and retaining consultants connected with that regulation and participation.
1-16 (d) The salaries, travel expenses and subsistence allowances of the
1-17 members of the commission.
2-1 3. All claims against the fund must be paid as other claims against the
2-2 state are paid.
2-3 4. The commission must furnish upon request a statement showing the
2-4 balance remaining in the fund as of the close of the preceding fiscal year.
2-5 Sec. 2. Chapter 704 of NRS is hereby amended by adding thereto the
2-6 provisions set forth as sections 3 to 12, inclusive, of this act.
2-7 Sec. 3. As used in sections 3 to 12, inclusive, of this act, unless the
2-8 context otherwise requires, the words and terms defined in sections 4 to
2-9 9, inclusive, of this act have the meanings ascribed to them in those
2-10 sections.
2-11 Sec. 4. “Biomass” means any organic matter that is available on a
2-12 renewable basis, including, without limitation:
2-13 1. Agricultural crops and agricultural wastes and residues;
2-14 2. Wood and wood wastes and residues;
2-15 3. Animal wastes;
2-16 4. Municipal wastes; and
2-17 5. Aquatic plants.
2-18 Sec. 5. “Portfolio standard” means a portfolio standard for
2-19 renewable energy established by the commission pursuant to section 10
2-20 of this act.
2-21 Sec. 6. 1. “Provider of electric service” and “provider” mean any
2-22 person or entity that is in the business of selling electricity to retail
2-23 customers in this state, regardless of whether the person or entity is
2-24 otherwise subject to regulation by the commission.
2-25 2. The term does not include:
2-26 (a) This state or an agency or instrumentality of this state.
2-27 (b) A rural electric cooperative established pursuant to chapter 81 of
2-28 NRS.
2-29 (c) A general improvement district established pursuant to chapter
2-30 318 of NRS.
2-31 (d) A utility established pursuant to chapter 709 or 710 of NRS.
2-32 (e) A cooperative association, nonprofit corporation, nonprofit
2-33 association or provider of electric service which is declared to be a public
2-34 utility pursuant to NRS 704.673 and which provides service only to its
2-35 members.
2-36 (f) A landlord of a mobile home park or owner of a company town
2-37 who is subject to any of the provisions of NRS 704.905 to 704.960,
2-38 inclusive.
2-39 Sec. 7. 1. “Renewable energy” means:
2-40 (a) Biomass;
2-41 (b) Geothermal energy;
2-42 (c) Solar energy; and
2-43 (d) Wind.
2-44 2. The term does not include coal, natural gas, oil, propane or any
2-45 other fossil fuel, or nuclear energy.
2-46 Sec. 8. “Renewable energy system” means:
2-47 1. A facility or energy system that:
2-48 (a) Uses renewable energy to generate electricity; and
3-1 (b) Transmits or distributes the electricity that it generates from
3-2 renewable energy via:
3-3 (1) A power line which is dedicated to the transmission or
3-4 distribution of electricity generated from renewable energy and which is
3-5 connected to a facility or system owned, operated or controlled by a
3-6 provider of electric service; or
3-7 (2) A power line which is shared with not more than one facility or
3-8 energy system generating electricity from nonrenewable energy and
3-9 which is connected to a facility or system owned, operated or controlled
3-10 by a provider of electric service.
3-11 2. A solar thermal energy system that reduces the consumption of
3-12 electricity.
3-13 Sec. 9. 1. “Retail customer” means a customer who purchases
3-14 electricity at retail.
3-15 2. The term includes, without limitation:
3-16 (a) This state, a political subdivision of this state or an agency or
3-17 instrumentality of this state or political subdivision of this state when it
3-18 purchases electricity at retail; and
3-19 (b) A landlord of a mobile home park or owner of a company town
3-20 who is subject to any of the provisions of NRS 704.905 to 704.960,
3-21 inclusive.
3-22 Sec. 10. 1. For each provider of electric service, the commission
3-23 shall establish a portfolio standard for renewable energy. The portfolio
3-24 standard must require each provider to generate or acquire electricity
3-25 from renewable energy systems in an amount that is:
3-26 (a) For calendar years 2003 and 2004, not less than 5 percent of the
3-27 total amount of electricity sold by the provider to its retail customers in
3-28 this state during that calendar year.
3-29 (b) For calendar years 2005 and 2006, not less than 7 percent of the
3-30 total amount of electricity sold by the provider to its retail customers in
3-31 this state during that calendar year.
3-32 (c) For calendar years 2007 and 2008, not less than 9 percent of the
3-33 total amount of electricity sold by the provider to its retail customers in
3-34 this state during that calendar year.
3-35 (d) For calendar years 2009 and 2010, not less than 11 percent of the
3-36 total amount of electricity sold by the provider to its retail customers in
3-37 this state during that calendar year.
3-38 (e) For calendar years 2011 and 2012, not less than 13 percent of the
3-39 total amount of electricity sold by the provider to its retail customers in
3-40 this state during that calendar year.
3-41 (f) For calendar year 2013 and for each calendar year thereafter, not
3-42 less than 15 percent of the total amount of electricity sold by the provider
3-43 to its retail customers in this state during that calendar year.
3-44 2. In addition to the requirements set forth in subsection 1, the
3-45 portfolio standard for each provider must require that:
3-46 (a) Of the total amount of electricity that the provider is required to
3-47 generate or acquire from renewable energy systems during each calendar
3-48 year, not less than 5 percent of that amount must be generated or
3-49 acquired from solar renewable energy systems.
4-1 (b) If the provider acquires electricity from a renewable energy system
4-2 pursuant to a renewable energy contract with another party:
4-3 (1) The term of the renewable energy contract must be not less than
4-4 10 years, unless the other party agrees to a renewable energy contract
4-5 with a shorter term; and
4-6 (2) The terms and conditions of the renewable energy contract must
4-7 be just and reasonable, as determined by the commission. If the provider
4-8 is a public utility and the commission approves the terms and conditions
4-9 of the renewable energy contract between the provider and the other
4-10 party, the renewable energy contract and its terms and conditions shall
4-11 be deemed to be a prudent investment and the provider may recover all
4-12 just and reasonable costs associated with the renewable energy contract.
4-13 3. If, for the benefit of one or more of its retail customers in this
4-14 state, the provider has subsidized, in whole or in part, the acquisition or
4-15 installation of a solar thermal energy system which qualifies as a
4-16 renewable energy system and which reduces the consumption of
4-17 electricity, the total reduction in the consumption of electricity during
4-18 each calendar year that results from the solar thermal energy system
4-19 shall be deemed to be electricity that the provider generated or acquired
4-20 from a renewable energy system for the purposes of complying with its
4-21 portfolio standard.
4-22 4. The commission may adopt regulations that establish a system of
4-23 renewable energy credits that may be used by a provider to comply with
4-24 its portfolio standard.
4-25 5. Except as otherwise provided in subsection 6, each provider shall
4-26 comply with its portfolio standard during each calendar year.
4-27 6. If, for any calendar year, a provider is unable to comply with its
4-28 portfolio standard through the generation of electricity from its own
4-29 renewable energy systems or, if applicable, through the use of renewable
4-30 energy credits, the provider shall take actions to acquire electricity
4-31 pursuant to one or more renewable energy contracts. If the commission
4-32 determines that, for a calendar year, there is not or will not be a
4-33 sufficient supply of electricity made available to the provider pursuant to
4-34 renewable energy contracts with just and reasonable terms and
4-35 conditions, the commission shall exempt the provider, for that calendar
4-36 year, from the remaining requirements of its portfolio standard or from
4-37 any appropriate portion thereof, as determined by the commission.
4-38 7. The commission shall adopt regulations for the determination of
4-39 just and reasonable terms and conditions for the renewable energy
4-40 contracts that a provider of electric service must enter into to comply with
4-41 its portfolio standard.
4-42 8. As used in this section:
4-43 (a) “Renewable energy contract” means a contract to acquire
4-44 electricity from one or more renewable energy systems owned, operated
4-45 or controlled by other parties.
4-46 (b) “Terms and conditions” includes, without limitation, the price that
4-47 a provider of electric service must pay to acquire electricity pursuant to a
4-48 renewable energy contract.
5-1 Sec. 11. 1. Each provider of electric service shall submit to the
5-2 commission an annual report that provides information relating to the
5-3 actions taken by the provider to comply with its portfolio standard.
5-4 2. Each provider shall submit the annual report to the commission
5-5 after the end of each calendar year and within the time prescribed by the
5-6 commission. The report must be submitted in a format approved by the
5-7 commission.
5-8 3. The commission may adopt regulations that require providers to
5-9 submit to the commission additional reports during each calendar year.
5-10 4. Each annual report and each additional report must include clear
5-11 and concise information that sets forth:
5-12 (a) The amount of electricity which the provider generated or
5-13 acquired from renewable energy systems during the reporting period
5-14 and, if applicable, the amount of renewable energy credits that the
5-15 provider acquired, sold or traded during the reporting period to comply
5-16 with its portfolio standard;
5-17 (b) The capacity of each renewable energy system owned, operated or
5-18 controlled by the provider, the total amount of electricity generated by
5-19 each such system during the reporting period and the percentage of that
5-20 total amount which was generated directly from renewable energy;
5-21 (c) Whether, during the reporting period, the provider began
5-22 construction on, acquired or placed into operation any renewable energy
5-23 system and, if so, the date of any such event; and
5-24 (d) Any other information that the commission by regulation may
5-25 deem relevant.
5-26 Sec. 12. 1. The commission shall adopt regulations to carry out
5-27 and enforce the provisions of sections 3 to 12, inclusive, of this act. The
5-28 regulations adopted by the commission may include any enforcement
5-29 mechanisms which are necessary and reasonable to ensure that each
5-30 provider of electric service complies with its portfolio standard. Such
5-31 enforcement mechanisms may include, without limitation, the imposition
5-32 of administrative fines.
5-33 2. If a provider does not comply with its portfolio standard for any
5-34 calendar year and the commission has not exempted the provider from
5-35 the requirements of its portfolio standard pursuant to section 10 of this
5-36 act, the commission may impose an administrative fine against the
5-37 provider or take other administrative action against the provider, or do
5-38 both.
5-39 3. The commission may impose an administrative fine against a
5-40 provider based upon:
5-41 (a) Each kilowatt-hour of electricity that the provider does not
5-42 generate or acquire from a renewable energy system or a solar renewable
5-43 energy system during a calendar year in violation of its portfolio
5-44 standard; or
5-45 (b) Any other reasonable formula adopted by the commission.
5-46 4. In the aggregate, the administrative fines imposed against a
5-47 provider for all violations of its portfolio standard for a single calendar
5-48 year must not exceed the amount which is necessary and reasonable to
6-1 ensure that the provider complies with its portfolio standard, as
6-2 determined by the commission.
6-3 5. If the commission imposes an administrative fine against a
6-4 provider that is a public utility:
6-5 (a) The administrative fine is not a cost of service of the provider;
6-6 (b) The provider shall not include any portion of the administrative
6-7 fine in any application for a rate adjustment or rate increase; and
6-8 (c) The commission shall not allow the provider to recover any portion
6-9 of the administrative fine from its retail customers.
6-10 6. All administrative fines imposed and collected pursuant to this
6-11 section must be deposited in the state general fund.
6-12 Sec. 13. NRS 704.743 is hereby amended to read as follows:
6-13 704.743 1. A utility which supplies electricity in this state may apply
6-14 to the commission for authority to charge, as part of a program of optional
6-15 pricing, a higher rate for electricity that is [derived] generated from
6-16 renewable energy . [resources.]
6-17 2. The program [must] may provide the customers of the utility with
6-18 the option of paying a higher rate for electricity to support the increased
6-19 use by the utility of renewable energy [resources] in the [production]
6-20 generation of electricity.
6-21 3. As used in this section [, “renewable energy resources” means
6-22 resources from which electricity is produced, but which are not consumed
6-23 or combusted and are] :
6-24 (a) “Biomass” has the meaning ascribed to it in section 4 of this act.
6-25 (b) “Renewable energy” means a source of energy that occurs
6-26 naturally or is regenerated [,] naturally, including, without limitation:
6-27 [(a)] (1) Wind;
6-28 [(b)] (2) Solar energy; [and
6-29 (c)] (3) Geothermal energy [.] ; and
6-30 (4) Biomass.
6-31 The term does not include coal, natural gas, oil, propane or any other
6-32 fossil fuel, or nuclear energy.
6-33 Sec. 14. Chapter 278 of NRS is hereby amended by adding thereto a
6-34 new section to read as follows:
6-35 In each county whose population is 100,000 or more:
6-36 1. If the governing body of the county or any city in the county has
6-37 adopted a building code, each such governing body shall, as part of its
6-38 building code, adopt construction codes and energy codes that regulate:
6-39 (a) The design of energy efficient residential, commercial and
6-40 industrial structures; and
6-41 (b) The installation of energy efficient mechanical, lighting and power
6-42 systems in such structures.
6-43 2. If the governing body of the county or any city in the county has
6-44 not adopted a building code, each such governing body shall:
6-45 (a) By ordinance, adopt the codes described in subsection 1; and
6-46 (b) Provide for the enforcement of such codes by the officers or
6-47 employees of the county or city or by the officers or employees of another
6-48 local government pursuant to an interlocal agreement.
6-49 3. The codes described in subsection 1 must:
7-1 (a) Be adopted and become effective not later than January 1, 2002;
7-2 and
7-3 (b) Be applied to each new residential, commercial and industrial
7-4 structure on which construction begins on or after the date on which the
7-5 codes become effective.
7-6 Sec. 15. NRS 278.010 is hereby amended to read as follows:
7-7 278.010 As used in NRS 278.010 to 278.630, inclusive, and section 14
7-8 of this act, unless the context otherwise requires, the words and terms
7-9 defined in NRS 278.0105 to 278.0195, inclusive, have the meanings
7-10 ascribed to them in those sections.
7-11 Sec. 16. NRS 704.989 is hereby repealed.
7-12 Sec. 17. Not later than 180 days after the effective date of this act, the
7-13 public utilities commission of Nevada shall adopt the regulations required
7-14 by section 10 of this act.
7-15 Sec. 18. This act becomes effective upon passage and approval.
7-16 TEXT OF REPEALED SECTION
7-17 704.989 Renewable energy resources: Portfolio standards; report;
7-18 exceptions.
7-19 1. The commission shall establish portfolio standards for domestic
7-20 energy that set forth the minimum percentage of the total amount of
7-21 electricity sold by an electric utility to its retail customers in this state
7-22 during each calendar year that must be derived from renewable energy
7-23 resources. The portfolio standards must:
7-24 (a) On January 1, 2001, be set at two-tenths of 1 percent of the total
7-25 amount of electricity sold by the electric utility to its retail customers in
7-26 this state during the immediately preceding calendar year.
7-27 (b) On January 1 of each successive odd-numbered year, be increased
7-28 by two-tenths of 1 percent of the total amount of electricity sold by the
7-29 electric utility to its retail customers in this state during the immediately
7-30 preceding calendar year until the portfolio standards reach a total of 1
7-31 percent of the total amount of electricity sold by the electric utility to its
7-32 retail customers in this state during the immediately preceding calendar
7-33 year.
7-34 (c) Be derived from not less than 50 percent renewable energy
7-35 resources.
7-36 (d) Be derived from not less than 50 percent solar renewable energy
7-37 systems.
7-38 (e) Be based on renewable energy credits, if applicable.
7-39 2. Each electric utility shall comply with the portfolio standards
7-40 established by the commission pursuant to this section. At the end of each
7-41 calendar year, each electric utility shall submit a report, in a format
7-42 approved by the commission, of the quantity of renewable energy and
7-43 credits, if applicable, that the electric utility generated, purchased, sold and
7-44 traded to meet the portfolio standards.
8-1 3. In establishing the portfolio standards pursuant to this section, the
8-2 commission may establish a system of credits pursuant to which an electric
8-3 utility may comply with the provisions of this section. A system of credits
8-4 must provide that:
8-5 (a) Credits are issued for renewable energy resources for each kilowatt
8-6 hour of energy which it produces; and
8-7 (b) Holders of credits may trade or sell the credits to other parties.
8-8 4. For the purposes of this section, if, on January 1, 1997, at least 9
8-9 percent of the total amount of electricity sold by an electric utility to its
8-10 retail customers in this state during the immediately preceding calendar
8-11 year was derived from renewable energy resources, the electric utility shall
8-12 be deemed to be in compliance until January 1, 2005, with the portfolio
8-13 standards established by the commission pursuant to this section. Between
8-14 January 1, 2005, and December 31, 2009, such an electric utility shall
8-15 have one-half of 1 percent of the total amount of electricity sold to its
8-16 retail customers in this state, increased in annual increments of one-tenth
8-17 of 1 percent during each calendar year of that period, derived from solar
8-18 energy resources for full compliance with the portfolio standards
8-19 established by the commission pursuant to this section.
8-20 5. In addition to the report required by subsection 2, each electric
8-21 utility shall submit a report, in a format approved by the commission, that
8-22 provides information relating to the compliance by the electric utility with
8-23 the requirements of this section. Such reports must be made at least
8-24 annually, unless the commission by regulation determines that such
8-25 reports must be made more frequently than annually, and must include
8-26 clear and concise information that sets forth:
8-27 (a) If the electric utility installed a renewable energy system during the
8-28 period for which the report is being made, the date of installation;
8-29 (b) The capacity of renewable energy systems of the electric utility;
8-30 (c) The amount of production of energy from the renewable energy
8-31 systems;
8-32 (d) The portion of the production of energy that is directly derived from
8-33 renewable energy resources;
8-34 (e) The quantity of energy from renewable energy systems that is
8-35 transmitted or distributed, or both, to retail customers in this state by the
8-36 electric utility; and
8-37 (f) Such other information that the commission by regulation may deem
8-38 relevant.
8-39 6. The provisions of this section do not apply to:
8-40 (a) Rural electric cooperatives established pursuant to chapter 81 of
8-41 NRS;
8-42 (b) General improvement districts established pursuant to chapter 318
8-43 of NRS; or
8-44 (c) Utilities established pursuant to chapter 709 or 710 of NRS.
8-45 7. As used in this section:
8-46 (a) “Electric utility” has the meaning ascribed to it in section 19 of this
8-47 act.
8-48 (b) “Renewable energy resources” means wind, solar, geothermal and
8-49 biomass energy resources that are naturally regenerated.
9-1 (c) “Renewable energy system” means an energy system that utilizes
9-2 renewable energy resources to produce electricity or solar thermal energy
9-3 systems that reduce the consumption of electricity that was installed and
9-4 commenced operations after July 1, 1997.
9-5 H