Illinois legislators introduce groundbreaking clean energy bill

Source: by Kari Lydersen, Midwest Energy News • Posted: Friday, February 20, 2015

Illinois legislators are introducing a sweeping bill today that would “fix” the state’s troubled Renewable Portfolio Standard, create ambitious goals and policies for energy efficiency and solar energy and, backers say, create 32,000 clean-energy jobs per year.

The bill is being sponsored by state Sen. Don Harmon (D-Oak Park) and state Rep. Elaine Nekritz (D-Northbrook). It realizes the stated goals of the Illinois Clean Jobs Coalition, a group of 26 organizations and 33 businesses that launched earlier this month (and includes members of RE-AMP, which publishes Midwest Energy News).

The bill extends and ramps up the state’s renewable standard by requiring 35 percent of energy consumed in Illinois to be generated by clean renewable sources by 2030. The current standard calls for 25 percent by 2025, and experts were worried the state would not meet these goals because of problems with how the standard is currently structured.

The bill allows the Illinois Power Agency, which procures electricity on behalf of utilities ComEd and Ameren, to develop a long-term plan to procure renewables. This would avoid the problems currently plaguing the standard, wherein it is nearly impossible for wind and solar developers to be certain of a long-term commitment to purchase their power.

And as many utilities nationwide are trying to limit the growth of distributed solar generation, the bill includes a carve-out for distributed solar that would guarantee such solar installations are supported by utilities. The bill supports individual rooftop solar installations and community solar projects which people can invest in if they don’t have rooftop access. The bill also encourages utility-scale solar farms built on brownfields.

The bill also includes a “robust” solar program for low-income communities, as a summary distributed by proponents phrases it, and a solar job training component. And it mandates that a prevailing wage be paid for work on wind projects and solar projects over 1,000 kW.

Finally the bill continues an existing two percent cap on the amount utilities can increase rates related to their investments in renewable energy during the course of the program.

Market strategies to limit carbon

In a move likely to be embraced by renewable and nuclear energy interests, the bill calls on the Illinois Environmental Protection Agency to develop market-based strategies to reduce carbon emissions in order to meet the U.S. EPA’s requirements under the Clean Power Plan.

The bill authorizes the Illinois EPA to put a cap on power plant carbon emissions that, along with renewable energy and energy efficiency improvements, meets the federal standard for carbon reductions, which is still being finalized.

The bill also requires the Illinois EPA to administer an auction for carbon dioxide emissions allowances under the cap. Significantly, the bill prohibits the use of offsets or free carbon allowances in the carbon market. Sixty-five percent of the proceeds of the auction go to fund energy efficiency and renewable energy, with a portion going specifically to low-income and environmental justice communities including ones where power plants have been located. Five percent of the auction proceeds will fund assistance on energy bills for low-income customers.

An additional 10 percent of the auction proceeds will go to help communities polluted by power plants, five percent will go to job transition assistance for people affected by power plant closures or other energy shifts, and five percent will go toward “innovative strategies” on energy.

And the bill requires the state to attempt to enter a multi-state agreement for carbon reductions, but allows an Illinois-only program if the multi-state program isn’t feasible.

Energy efficiency boost

The legislation calls for utilities to make extensive investments in energy efficiency by mandating a 20 percent cumulative reduction in energy demand by 2025. The legislation says the program value must exceed the costs, and 12.5 percent of the program will be dedicated to serving low-income ratepayers. Utilities would have to report their progress to the Illinois Commerce Commission every four years.

The bill defines demand response – intentional reductions of energy use during peak times – and energy efficiency as commodities that utilities can procure and recover costs through their rate formulas.

The bill also makes it easier for individual customers to invest in energy efficiency, by modifying the on-bill financing option to make it more widely available. And the bill encourages more ratepayers to participate in real-time pricing, where people pay the actual price for electricity they use at a given time.

This encourages customers to reduce energy use during times of peak demand, when it is more expensive. The bill would eliminate the requirement that people stick with the program for 12 months, so theoretically people would see it as less risky and be more willing to give it a try.

“This bill benefits people in every part of Illinois, in our biggest cities, in suburbs, in farming communities – anywhere where people would gain from new jobs, better health and a cleaner environment,” said Harmon in a statement. “As strong as the clean energy economy is today, with 100,000 clean energy jobs throughout the state, Illinois is at a tipping point. There is no time to waste.”