S T A T E   O F   N E W   Y O R K
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                                 4862--A

                       2011-2012 Regular Sessions

                            I N  S E N A T E

                             April 27, 2011
                               ___________

Introduced  by  Sens.  LAVALLE,  AVELLA,  OPPENHEIMER  -- read twice and
  ordered printed, and when printed to be committed to the Committee  on
  Energy and Telecommunications -- recommitted to the Committee on Ener-
  gy  and Telecommunications in accordance with Senate Rule 6, sec. 8 --
  committee discharged, bill amended, ordered reprinted as  amended  and
  recommitted to said committee

AN  ACT to amend the public authorities law, in relation to creating the
  solar feed-in tariff pilot program

  THE PEOPLE OF THE STATE OF NEW YORK, REPRESENTED IN SENATE AND  ASSEM-
BLY, DO ENACT AS FOLLOWS:

  Section  1. Legislative intent. The legislature finds and declares all
of the following:
  (a) It is the policy of the state of New York to encourage  the  rapid
and  sustainable  development  of  electricity  from  renewable sources,
particularly from smaller, widely distributed solar photovoltaic instal-
lations, by the adoption of a solar feed-in tariff pilot program created
pursuant to this act. Such pilot program will be instituted by the  Long
Island Power Authority within the service area of the authority.
  (b)  This  act  will create green jobs for the state. The German solar
energy industry created over 50,000 jobs in less than five  years,  with
the  entire  renewable energy industry creating as many as 200,000 jobs.
Spain boasts 25,000 solar energy workers. Gainesville, Florida, where  a
solar  feed-in tariff program is currently being tested, is experiencing
a surge of capital investment  in  community  solar  systems  and  local
contractors are hiring.
  (c)  The  pilot program created pursuant to this act will moderate the
near-term impact on ratepayers, while reducing volatility and  long-term
rates relative to other sources of power.
  (d)  The  pilot  program  created  pursuant to this act will encourage
energy conservation by requiring a separate new  meter  to  measure  the

 EXPLANATION--Matter in ITALICS (underscored) is new; matter in brackets
                      [ ] is old law to be omitted.
                                                           LBD10773-03-2

              

S. 4862--A                          2

amount  of solar electricity produced on site, while retaining the meter
that measures the total amount of electricity used on site.
  (e)  Distributed generation will enhance reliability while maintaining
utility profitability.
  (f) Local power generation from renewable energy resources is a  clear
pathway to energy independence and security for our future.
  (g)  Distributed solar installations bring the opportunity for renewa-
ble power generation to the  local  level,  avoiding  the  environmental
costs  of  large-scale,  carbon-based, centralized power generation, and
reducing a wide range of air pollutants, particularly greenhouse gases.
  (h) This act presents a market mechanism to spur  the  solar  industry
within  our  communities. It provides a simple and transparent means for
solar investments to earn  reasonable  and  reliable  returns,  allowing
capital  to  flow  into  clean  and renewable energy systems in New York
communities. While initially more expensive, these investments will,  in
the  near  future,  result  in sustainable green power sources that will
deliver electricity to public  utilities  at  lower  energy  costs  than
conventional generation.
  S  2.  Sections 1020-ii, 1020-jj and 1020-kk of the public authorities
law, as renumbered by chapter 388 of the laws of  2011,  are  renumbered
sections 1020-jj, 1020-kk and 1020-ll and a new section 1020-ii is added
to read as follows:
  S  1020-II. SOLAR FEED-IN TARIFF PILOT PROGRAM. 1. FOR THE PURPOSES OF
THIS SECTION, THE FOLLOWING TERMS SHALL HAVE THE FOLLOWING MEANINGS:
  (A) "COMMISSIONED" MEANS THE FIRST  TIME  A  SOLAR  ENERGY  GENERATION
FACILITY  IS  PUT  INTO OPERATION FOLLOWING ESTABLISHMENT OF OPERATIONAL
READINESS. COMMISSIONING ALSO INCLUDES THE MODERNIZATION OF AN  EXISTING
SOLAR  ENERGY  GENERATION  FACILITY, IF MODERNIZATION COSTS ARE AT LEAST
FIFTY PERCENT OF THE TOTAL ESTIMATED COST  TO  BUILD  A  COMPLETELY  NEW
ELECTRICAL  GENERATION  FACILITY  AT  THAT  SITE, INCLUDING ALL BUILDING
STRUCTURES AND INSTALLATIONS REQUIRED FOR ITS OPERATION.
  (B) "PROGRAM" MEANS THE SOLAR FEED-IN  TARIFF  PILOT  PROGRAM  CREATED
PURSUANT TO THIS SECTION.
  (C) "SOLAR ENERGY GENERATION FACILITY" MEANS A FACILITY OR DEVICE THAT
HAS  THE  PRIMARY PURPOSE OF COLLECTION AND DISTRIBUTION OF SOLAR ENERGY
FOR THE GENERATION OF ELECTRICITY, THAT HAS THE CAPACITY TO  PRODUCE  AT
LEAST ONE KILOWATT AND NOT MORE THAN ONE MEGAWATT OF ALTERNATING CURRENT
RATED PEAK ELECTRICITY.
  (D)  "TAXABLE  ENTITY"  MEANS  AN  OWNER OR OPERATOR OF A SOLAR ENERGY
GENERATION FACILITY THAT IS NOT A TAX-EXEMPT ENTITY.
  (E) "TAX-EXEMPT ENTITY" MEANS AN OWNER OR OPERATOR OF A  SOLAR  ENERGY
GENERATION  FACILITY  THAT IS LISTED UNDER SECTION 501(C) OF TITLE 26 OF
THE UNITED STATES CODE.
  2. (A) THE AUTHORITY SHALL ENTER INTO AGREEMENTS TO  PURCHASE  ALL  OF
THE  ELECTRICITY  GENERATED  BY  THE OWNER OR OPERATOR OF A SOLAR ENERGY
GENERATION FACILITY LOCATED WITHIN THE SERVICE AREA OF THE AUTHORITY  AT
THE  PRICES  SET  FORTH  IN  SUBDIVISION  SIX  OF THIS SECTION USING THE
CONTRACT DEVELOPED BY THE AUTHORITY PURSUANT  TO  SUBDIVISION  THREE  OF
THIS  SECTION ON A FIRST-COME-FIRST-SERVED BASIS. CONTRACTS ENTERED INTO
PURSUANT TO THIS SUBDIVISION SHALL BE TRANSFERABLE AND MAY  BE  USED  AS
SECURITY FOR LOANS.  NOTWITHSTANDING ANY PROVISION OF LAW TO THE CONTRA-
RY, THERE SHALL BE NO CAP ON THE AMOUNT OF ELECTRICITY PURCHASED FROM AN
INDIVIDUAL  OWNER  OR  OPERATOR  OF  A  SOLAR ENERGY GENERATING FACILITY
LOCATED WITHIN THE SERVICE  AREA  OF  THE  AUTHORITY  PURSUANT  TO  THIS
SECTION.  THE  ONLY  LIMITATION  ON  THE AMOUNT OF ELECTRICITY PURCHASED

S. 4862--A                          3

PURSUANT TO THIS SECTION SHALL BE THE AGGREGATE LIMITATION PROVIDED  FOR
IN PARAGRAPH (C) OF SUBDIVISION THREE OF THIS SECTION.
  (B)  THE OWNER OR OPERATOR OF A SOLAR ENERGY GENERATION FACILITY SHALL
PROVIDE THE AUTHORITY WITH NOTICE NOT LESS THAN SIXTY DAYS PRIOR TO  THE
SOLAR ENERGY GENERATION FACILITY BECOMING OPERATIONAL. ONCE OPERATIONAL,
THE OWNER OR OPERATOR OF THE FACILITY SHALL REQUEST INTERCONNECTION WITH
THE ELECTRICAL CORPORATION'S DISTRIBUTION SYSTEM.
  (C) (I) THE AUTHORITY SHALL CONNECT A SOLAR ENERGY GENERATION FACILITY
TO  ITS  DISTRIBUTION  SYSTEM  UPON  THE TERMS AND CONDITIONS SET BY THE
AUTHORITY, BUT IN NO CASE MORE THAN SIXTY DAYS  AFTER  THE  REQUEST  FOR
INTERCONNECTION  PURSUANT  TO  PARAGRAPH  (B)  OF  THIS SUBDIVISION. THE
AUTHORITY SHALL APPLY, IN A NONDISCRIMINATORY MANNER, ESTABLISHED STAND-
ARDS FOR THE INTERCONNECTION OF SOLAR ENERGY GENERATION FACILITIES  THAT
WILL  ENSURE THE RELIABILITY OF ELECTRICAL SERVICE TO ALL CUSTOMERS, AND
WILL ENSURE THE SAFETY OF CUSTOMERS, GRID OPERATOR  EMPLOYEES,  AND  THE
GENERAL PUBLIC.
  (II)  THE  AUTHORITY  SHALL  PREPARE,  PUBLISH, AND APPLY TRANSPARENT,
OBJECTIVE, AND  NONDISCRIMINATORY  RULES  FOR  CONNECTING  SOLAR  ENERGY
GENERATION FACILITIES TO ITS DISTRIBUTION SYSTEM.
  (III)  IF  THE  AUTHORITY  DOES NOT PROVIDE INTERCONNECTION WITHIN THE
SIXTY-DAY TIMEFRAME ESTABLISHED PURSUANT TO  SUBPARAGRAPH  (I)  OF  THIS
PARAGRAPH,  THE AUTHORITY SHALL BEGIN PAYMENTS PURSUANT TO PARAGRAPH (A)
OF THIS SUBDIVISION ON THE SIXTY-FIRST DAY AND THEREAFTER.  THE  PAYMENT
AMOUNTS  SHALL  BE BASED ON THE NAMEPLATE CAPACITY THAT THE SOLAR ENERGY
GENERATION FACILITY COULD  PROVIDE  IF  CONNECTED  TO  THE  DISTRIBUTION
SYSTEM.
  (IV)  ALL  COSTS  ASSOCIATED  WITH THE INTERCONNECTION OF SOLAR ENERGY
GENERATION FACILITIES, INCLUDING DIRECT INTERCONNECTION COSTS,  DISTRIB-
UTION SYSTEM ENHANCEMENTS, AND AUTHORITY COMPLIANCE COSTS, SHALL BE PAID
BY  THE  AUTHORITY AND INCLUDED AMONG THE COSTS THAT THE AUTHORITY SHALL
CONSIDER UNDER PARAGRAPH (C) OF SUBDIVISION THREE OF  THIS  SECTION  FOR
COST RECOVERY FROM RATEPAYERS.
  3. (A) THE AUTHORITY SHALL DEVELOP A STANDARD CONTRACT OF TWENTY YEARS
DURATION TO BE USED FOR ALL PAYMENTS MADE PURSUANT TO SUBDIVISION TWO OF
THIS  SECTION.  THE  CONTRACT SHALL BE WRITTEN IN SIMPLE, CLEAR LANGUAGE
AND SHALL SPECIFY BOTH OF THE FOLLOWING:
  (I) THE PRICE TO BE PAID FOR EACH KILOWATT-HOUR GENERATED.
  (II) THAT THE OWNER OR OPERATOR OF THE SOLAR ENERGY GENERATION FACILI-
TY MUST SELL, AND THE ELECTRICAL CORPORATION MUST PURCHASE, ALL  OF  THE
SOLAR ENERGY GENERATED BY THE SOLAR ENERGY GENERATION FACILITY.
  (B)  THE  AUTHORITY MAY ADJUST THE AMOUNT SET FORTH IN SUBDIVISION SIX
OF THIS SECTION NO MORE THAN ONCE EVERY TWO YEARS. THE  AUTHORITY  SHALL
ANNUALLY REVIEW THE AMOUNT TAKING INTO CONSIDERATION THE ABILITY OF SUCH
AMOUNT TO SUCCESSFULLY ENCOURAGE THE INSTALLATION OF SOLAR ENERGY GENER-
ATION FACILITIES AND TAKING INTO CONSIDERATION ANY CHANGES IN ANY OF THE
FOLLOWING:
  (I)  ACTUAL  AVERAGE  SYSTEM COSTS AND THE PRODUCTION OF EACH TYPE AND
SIZE OF SOLAR ENERGY GENERATION FACILITY.
  (II) INFLATION AND INTEREST RATES.
  (III) THE RETURN ACHIEVED BY THE OWNERS  OR  OPERATORS  OF  THE  SOLAR
ENERGY  GENERATION FACILITIES AND THE ELECTRICITY RATES PAID BY RATEPAY-
ERS.
  (C) NO MORE THAN ONE HUNDRED MEGAWATTS OF  ALTERNATING  CURRENT  RATED
PEAK ELECTRICITY IS SUBJECT TO THE REQUIREMENTS OF THIS SECTION.
  4. THE AUTHORITY SHALL ENSURE ALL OF THE FOLLOWING:

S. 4862--A                          4

  (A) A SIMPLE, CLEAR APPLICATION FORM FOR SOLAR ENERGY SYSTEM OPERATORS
OR OWNERS REQUIRING IDENTIFICATION OF THE SOLAR ENERGY GENERATION FACIL-
ITY  OWNER AND THE INSTALLER, AND THE PRECISE LOCATION, TYPE AND SIZE OF
THE FACILITY.
  (B) APPLICATIONS ARE PROCESSED IN LESS THAN THIRTY DAYS.
  (C)  SOLAR  ENERGY  GENERATION  FACILITIES ARE COMMISSIONED WITHIN ONE
YEAR AFTER THEIR APPLICATION IS APPROVED.
  (D) NO SYSTEM INSPECTION IS REQUIRED BEYOND WHAT IS REQUIRED BY EXIST-
ING LAW.
  (E) THE INSTALLATION AND USE OF A SEPARATE, DEDICATED METER TO MEASURE
THE PRODUCTION OF SOLAR ENERGY FACILITIES  OPERATING  PURSUANT  TO  THIS
SECTION,  AND REQUIRING ELECTRICAL CORPORATIONS TO READ THAT METER AT NO
COST TO THE OWNER OR OPERATOR OF THE SOLAR ENERGY GENERATION FACILITY.
  5. (A) THE AUTHORITY SHALL PREPARE AN  ANNUAL  REPORT  DESCRIBING  AND
SUMMARIZING THE PROGRAM PURSUANT TO THIS SECTION.
  (B)  THE AUTHORITY SHALL BIENNIALLY SUBMIT A REPORT TO THE LEGISLATURE
AND THE GOVERNOR ON  THE  IMPLEMENTATION  OF  THIS  SECTION  THAT  SHALL
INCLUDE, BUT NOT BE LIMITED TO, ALL OF THE FOLLOWING:
  (I)  THE GENERATION CAPACITY OF NEW SOLAR ENERGY GENERATION FACILITIES
INSTALLED IN THE SERVICE AREA OF THE  AUTHORITY  AND  THE  ENVIRONMENTAL
EFFECTS OF THE ADDITION OF SUCH FACILITIES.
  (II) ACTIONS TAKEN BY THE AUTHORITY TO IMPLEMENT THIS SECTION.
  (III)  REVISIONS  TO  THE  AMOUNT SET FORTH IN SUBDIVISION SIX OF THIS
SECTION.
  (IV) THE IMPACT OF THE IMPLEMENTATION OF THIS  SECTION  ON  ELECTRICAL
RATES.
  (V)  RECOMMENDATIONS  FOR CHANGES TO THIS SECTION, IF ANY, THAT MAY BE
NECESSARY OR ADVISABLE, INCLUDING WHETHER THE PROVISIONS OF THIS SECTION
SHOULD BE EXPANDED TO OTHER CITIES OR ADOPTED STATEWIDE.
  6. THE PRICE OF ELECTRICITY UNDER AN AGREEMENT ENTERED  INTO  PURSUANT
TO THIS SECTION SHALL BE $0.22 PER KILOWATT HOUR.
  S 3. Severability. If any clause, sentence, paragraph, section or part
of  this act shall be adjudged by any court of competent jurisdiction to
be invalid and after exhaustion of  all  further  judicial  review,  the
judgment  shall  not affect, impair or invalidate the remainder thereof,
but shall be confined in its operation to the  clause,  sentence,  para-
graph,  section or part of this act directly involved in the controversy
in which the judgment shall have been rendered.
  S 4. This act shall take effect on the first of January next  succeed-
ing the date on which it shall have become a law.