SB-1502, As Passed House, December 1, 2010
HOUSE SUBSTITUTE FOR
SENATE BILL NO. 1502
A bill to amend 2008 PA 295, entitled
"Clean, renewable, and efficient energy act,"
by amending section 93 (MCL 460.1093).
THE PEOPLE OF THE STATE OF MICHIGAN ENACT:
Sec.
93. (1) An eligible primary or secondary electric
customer is exempt from charges the customer would otherwise incur
as an electric customer under section 89 or 91 if the customer
files with its electric provider and implements a self-directed
energy optimization plan as provided in this section.
(2)
Eligibility requirements for the exemption under
subsection
(1) are as follows:Subject to
subsection (3), an
electric customer is not eligible under subsection (1) unless it is
a commercial or industrial electric customer and meets all of the
following requirements:
(a) In 2009 or 2010, the customer must have had an annual peak
demand in the preceding year of at least 2 megawatts at each site
to be covered by the self-directed plan or 10 megawatts in the
aggregate at all sites to be covered by the plan.
(b) In 2011, 2012, or 2013, the customer or customers must
have had an annual peak demand in the preceding year of at least 1
megawatt at each site to be covered by the self-directed plan or 5
megawatts in the aggregate at all sites to be covered by the plan.
(c) In 2014 or any year thereafter, the customer or customers
must have had an annual peak demand in the preceding year of at
least 1 megawatt in the aggregate at all sites to be covered by the
self-directed plan.
(3) The eligibility requirements of subsection (2) do not
apply to a commercial or industrial customer that installs or
modifies an electric energy efficiency improvement under a property
assessed clean energy program pursuant to the property assessed
clean energy act.
(4) (3)
The commission shall by order
establish the rates,
terms, and conditions of service for customers related to this
subpart.
(5) (4)
The commission shall by order do
all of the following:
(a) Require a customer to utilize the services of an energy
optimization service company to develop and implement a self-
directed plan. This subdivision does not apply to a customer that
had an annual peak demand in the preceding year of at least 2
megawatts at each site to be covered by the self-directed plan or
10 megawatts in the aggregate at all sites to be covered by the
self-directed plan.
(b) Provide a mechanism to recover from customers under
subdivision (a) the costs for provider level review and evaluation.
(c) Provide a mechanism to cover the costs of the low income
energy optimization program under section 89.
(6) (5)
All of the following apply to a
self-directed energy
optimization plan under subsection (1):
(a) The self-directed plan shall be a multiyear plan for an
ongoing energy optimization program.
(b) The self-directed plan shall provide for aggregate energy
savings
that for each year meet or exceed the energy optimization
performance
standards based on the electricity
purchases in the
previous year for the site or sites covered by the self-directed
plan.
(c) Under the self-directed plan, energy optimization shall be
calculated based on annual electricity usage. Annual electricity
usage shall be normalized so that none of the following are
included in the calculation of the percentage of incremental energy
savings:
(i) Changes in electricity usage because of changes in business
activity levels not attributable to energy optimization.
(ii) Changes in electricity usage because of the installation,
operation, or testing of pollution control equipment.
(d) The self-directed plan shall specify whether electricity
usage will be weather-normalized or based on the average number of
megawatt hours of electricity sold by the electric provider
annually during the previous 3 years to retail customers in this
state. Once the self-directed plan is submitted to the provider,
this option shall not be changed.
(e) The self-directed plan shall outline how the customer
intends to achieve the incremental energy savings specified in the
self-directed plan.
(7) (6)
A self-directed energy optimization
plan shall be
incorporated into the relevant electric provider's energy
optimization plan. The self-directed plan and information submitted
by
the customer under subsection (9) (10) are confidential and
exempt from disclosure under the freedom of information act, 1976
PA 442, MCL 15.231 to 15.246. Projected energy savings from
measures implemented under a self-directed plan shall be attributed
to the relevant provider's energy optimization programs for the
purposes of determining annual incremental energy savings achieved
by the provider under section 77 or 81, as applicable.
(8) (7)
Once a customer begins to implement
a self-directed
plan at a site covered by the self-directed plan, that site is
exempt from energy optimization program charges under section 89 or
91 and is not eligible to participate in the relevant electric
provider's energy optimization programs.
(9) (8)
A customer implementing a
self-directed energy
optimization plan under this section shall annually submit to the
customer's
electric provider every 2 years a brief report
documenting the energy efficiency measures taken under the self-
directed
plan during that 2-year period, the
previous year, and the
corresponding energy savings that will result. The report shall
provide sufficient information for the provider and the commission
to monitor progress toward the goals in the self-directed plan and
to develop reliable estimates of the energy savings that are being
achieved
from self-directed plans. A customer shall promptly notify
the
provider if the customer fails to achieve incremental energy
savings
as set forth in its self-directed plan for a year that will
be
the first year covered by the next biannual report. The customer
report shall indicate the level of incremental energy savings
achieved for the year covered by the report and whether that level
of incremental energy savings meets the goal set forth in the
customer's
self-directed plan. If a customer
submitting a report or
notice
under this subsection wishes to amend
its self-directed
plan,
the customer shall submit with the report or notice an
amended self-directed plan. A report under this subsection shall be
accompanied by an affidavit from a knowledgeable official of the
customer that the information in the report is true and correct to
the best of the official's knowledge and belief. If the customer
has retained an independent energy optimization service company,
the requirements of this subsection shall be met by the energy
optimization service company.
(10) (9)
An electric provider shall provide
an annual report
to the commission that identifies customers implementing self-
directed energy optimization plans and summarizes the results
achieved cumulatively under those self-directed plans. The
commission may request additional information from the electric
provider. If the commission has sufficient reason to believe the
information is inaccurate or incomplete, it may request additional
information from the customer to ensure accuracy of the report.
(11) (10)
If the commission determines after
a contested case
hearing that the minimum energy optimization goals under subsection
(5)(b)
(6)(b) have not been achieved at the sites covered by a
self-directed plan, in aggregate, the commission shall order the
customer or customers collectively to pay to this state an amount
calculated as follows:
(a) Determine the proportion of the shortfall in achieving the
minimum
energy optimization goals under subsection (5)(b) (6)(b).
(b) Multiply the figure under subdivision (a) by the energy
optimization charges from which the customer or customers
collectively were exempt under subsection (1).
(c) Multiply the product under subdivision (b) by a number not
less than 1 or greater than 2, as determined by the commission
based on the reasons for failure to meet the minimum energy
optimization goals.
(12) (11)
If a customer has submitted a
self-directed plan to
an electric provider, the customer, the customer's energy
optimization service company, if applicable, or the electric
provider shall provide a copy of the self-directed plan to the
commission upon request.
(13) (12)
By September 1, 2010, following a
public hearing,
the commission shall establish an approval process for energy
optimization service companies. The approval process shall ensure
that energy optimization service companies have the expertise,
resources, and business practices to reliably provide energy
optimization services that meet the requirements of this section.
The commission may adopt by reference the past or current standards
of a national or regional certification or licensing program for
energy optimization service companies. However, the approval
process shall also provide an opportunity for energy optimization
service companies that are not recognized by such a program to be
approved by posting a bond in an amount determined by the
commission and meeting any other requirements adopted by the
commission for the purposes of this subsection. The approval
process for energy optimization service companies shall require
adherence to a code of conduct governing the relationship between
energy optimization service companies and electric providers.
(14) (13)
The department of energy, labor, and
economic growth
shall maintain on the department's website a list of energy
optimization
service companies approved under subsection (12) (13).
Enacting section 1. This amendatory act does not take effect
unless House Bill No. 5640 of the 95th Legislature is enacted into
law.