Bill Text: FL S1724 | 2011 | Regular Session | Introduced
Bill Title: Renewable Energy
Spectrum: Partisan Bill (Republican 5-0)
Status: (Introduced - Dead) 2011-05-07 - Indefinitely postponed and withdrawn from consideration [S1724 Detail]
Download: Florida-2011-S1724-Introduced.html
Florida Senate - 2011 SB 1724 By Senators Altman and Jones 24-00752-11 20111724__ 1 A bill to be entitled 2 An act relating to renewable energy; amending s. 3 212.08, F.S.; requiring that solar energy systems have 4 a certain percentage of components manufactured in 5 Florida or the United States in order to be eligible 6 for the exemption from the sales tax; amending s. 7 220.192, F.S.; extending the date of eligibility for 8 the renewable energy technologies investment tax 9 credit; revising the annual limits for the investment 10 tax credits; defining the term “solar energy system”; 11 providing requirement for a solar electric generating 12 facility to be eligible to receive the tax credit; 13 providing for unused amounts of the tax credit to be 14 carried forward; amending s. 220.193, F.S.; extending 15 until 2017 the Florida renewable energy production tax 16 credit; amending s. 366.02, F.S.; revising the 17 exceptions to the definition of the term “public 18 utility” to include the developer of certain renewable 19 energy generation facilities; creating s. 366.90, 20 F.S.; providing legislative intent with respect to the 21 production of electricity using renewable energy; 22 amending s. 366.91, F.S.; redefining the terms 23 “biomass,” “net metering,” and “renewable energy”; 24 amending s. 366.92, F.S.; revising legislative intent; 25 deleting and revising definitions; deleting provisions 26 for the renewable portfolio standard and renewable 27 energy credits; providing a mechanism for providers to 28 recover costs to produce or purchase specified amounts 29 of renewable energy through the environmental cost 30 recovery clause under certain conditions; providing 31 for a competitive auction; providing for recovery of 32 certain costs; providing for terms and conditions of a 33 standard form contract; providing criteria for 34 development deposits; providing criteria for 35 termination of the project; providing for required and 36 allowable purchase of renewable energy as a percentage 37 of the provider’s total revenue; providing for minimum 38 purchase of the various types of renewable energy; 39 providing limits on the amount of recoverable costs; 40 requiring certain information be provided to the 41 Public Service Commission for cost recovery 42 proceedings; providing conditions when a seller 43 surrenders attributes; requiring that certain revenues 44 received by a provider be shared with ratepayers; 45 exempting certain renewable energy generating 46 facilities from the Florida Electrical Power Plant 47 Siting Act; requiring providers to submit certain 48 information to the commission in its 10-year site 49 plan; exempting certain expansions of existing 50 renewable electric generating facilities from a 51 determination of need by the commission; authorizing 52 the developer of a solar energy generation facility to 53 locate the facility on the premises of a host consumer 54 under certain circumstances; requiring the commission 55 to adopt rules and submit reports to the Legislature; 56 exempting the expansion of existing renewable energy 57 electric generating facilities from requirements for a 58 determination of need under certain circumstances; 59 amending s. 377.601, F.S.; revising legislative intent 60 relating to the state’s energy policy; amending s. 61 377.703, F.S.; conforming cross-references; amending 62 s. 377.809, F.S; creating an energy economic zone 63 pilot program for attracting renewable energy, energy 64 efficiency, and biofuel technology industries to an 65 area; requiring the Department of Community Affairs to 66 provide technical assistance; providing for an 67 application process; providing criteria to grant at 68 least one application; amending s. 403.503, F.S.; 69 redefining the term “electrical power plant” for 70 purposes of the Florida Electrical Power Plant Siting 71 Act; providing for severability; providing an 72 effective date. 73 74 Be It Enacted by the Legislature of the State of Florida: 75 76 Section 1. Paragraph (hh) of subsection (7) of section 77 212.08, Florida Statutes, is amended to read: 78 212.08 Sales, rental, use, consumption, distribution, and 79 storage tax; specified exemptions.—The sale at retail, the 80 rental, the use, the consumption, the distribution, and the 81 storage to be used or consumed in this state of the following 82 are hereby specifically exempt from the tax imposed by this 83 chapter. 84 (7) MISCELLANEOUS EXEMPTIONS.—Exemptions provided to any 85 entity by this chapter do not inure to any transaction that is 86 otherwise taxable under this chapter when payment is made by a 87 representative or employee of the entity by any means, 88 including, but not limited to, cash, check, or credit card, even 89 when that representative or employee is subsequently reimbursed 90 by the entity. In addition, exemptions provided to any entity by 91 this subsection do not inure to any transaction that is 92 otherwise taxable under this chapter unless the entity has 93 obtained a sales tax exemption certificate from the department 94 or the entity obtains or provides other documentation as 95 required by the department. Eligible purchases or leases made 96 with such a certificate must be in strict compliance with this 97 subsection and departmental rules, and any person who makes an 98 exempt purchase with a certificate that is not in strict 99 compliance with this subsection and the rules is liable for and 100 shall pay the tax. The department may adopt rules to administer 101 this subsection. 102 (hh) Solar energy systems.—Also exempt are solar energy 103 systems, or any component thereof, as provided in this 104 paragraph. The Florida Solar Energy Center shall from time to 105 time certify to the department a list of equipment and requisite 106 hardware considered to be a solar energy system or a component 107 thereof. A solar energy system, or component thereof, having a 108 minimum of 50 percent of its materials manufactured in Florida, 109 as measured by the cost of such materials, or a minimum of 80 110 percent of its materials manufactured in the United States, as 111 measured by the cost of such materials, is exempt from the tax 112 imposed by this chapter. 113 Section 2. Paragraphs (c), (f), and (g) of subsection (1) 114 and subsection (2) of section 220.192, Florida Statutes, are 115 amended to read: 116 220.192 Renewable energy technologies investment tax 117 credit.— 118 (1) DEFINITIONS.—For purposes of this section, the term: 119 (c) “Eligible costs” means: 120 1. Seventy-five percent of all capital costs, operation and 121 maintenance costs, and research and development costs incurred 122 between July 1, 2006, and June 30, 20162010, up to a limit of 123 $25$3million per state fiscal year for all taxpayers, in 124 connection with an investment in hydrogen-powered vehicles and 125 hydrogen vehicle fueling stations in the state, including, but 126 not limited to, the costs of constructing, installing, and 127 equipping such technologies in the state. 128 2. Seventy-five percent of all capital costs, operation and 129 maintenance costs, and research and development costs incurred 130 between July 1, 2006, and June 30, 20162010, up to a limit of 131 $25$1.5million per state fiscal year for all taxpayers, and 132 limited to a maximum of $12,000 per fuel cell, in connection 133 with an investment in commercial stationary hydrogen fuel cells 134 in the state, including, but not limited to, the costs of 135 constructing, installing, and equipping such technologies in the 136 state. 137 3. Seventy-five percent of all capital costs, operation and 138 maintenance costs, and research and development costs incurred 139 between July 1, 2006, and June 30, 20162010, up to a limit of 140 $6$6.5million per state fiscal year for all taxpayers, in 141 connection with an investment in the production, storage, and 142 distribution of biodiesel (B10-B100) and ethanol (E10-E100) in 143 the state, including the costs of constructing, installing, and 144 equipping such technologies in the state. Gasoline fueling 145 station pump retrofits for ethanol (E10-E100) distribution 146 qualify as an eligible cost under this subparagraph. 147 4. Fifty percent of all capital costs incurred between July 148 1, 2010, and June 30, 2016, in connection with an investment in 149 solar energy systems in the state, up to a limit of $500,000 per 150 system and up to a limit of $250 million per state fiscal year 151 for all taxpayers. To be eligible, such system must comply with 152 state interconnection standards as required by the rules of the 153 Public Service Commission. The eligible costs shall be 154 reapportioned equally over 5 years. 155 (f) “Solar energy system” means equipment that provides for 156 the collection and use of incident solar energy for water 157 heating, space heating or cooling, or other applications that 158 would normally require a conventional source of energy such as 159 petroleum products, natural gas, or electricity that performs 160 primarily with solar energy. In other systems in which solar 161 energy is used in a supplemental way, only those components that 162 collect and transfer solar energy are included in this 163 definition. 164 (g)(f)“Taxpayer” includes a corporation as defined in 165 paragraph (b) or s. 220.03. 166 (2) TAX CREDIT.— 167 (a) For tax years beginning on or after January 1, 2007, a 168 credit against the tax imposed by this chapter shall be granted 169 in an amount equal to the eligible costs defined in 170 subparagraphs (1)(c)1.-3. For a solar electric generating 171 facility to be eligible to receive the investment tax credit 172 provided by this section, the renewable energy supplier’s 173 facility must be located in Florida and contain at least 60 174 percent, as a percentage of the total installed cost including 175 construction labor costs, of materials that are manufactured in 176 Florida. For other renewable electric generating facilities to 177 be eligible to receive the investment tax credit provided by 178 this section, the renewable energy supplier’s facility must be 179 located in Florida and contain at least 30 percent, as a 180 percentage of the total installed cost including construction 181 labor costs, of materials that are manufactured in Florida. The 182 credits may be used in tax years beginning January 1, 2007, and 183 ending December 31, 20162010, after which the credit shall 184 expire. If the credit is not fully used in any one tax year 185 because of insufficient tax liability on the part of the 186 corporation, the unused amount may be carried forward and used 187 in tax years beginning January 1, 2007, and ending December 31, 188 20182012, after which the credit carryover expires and may not 189 be used. A taxpayer that files a consolidated return in this 190 state as a member of an affiliated group under s. 220.131(1) may 191 be allowed the credit on a consolidated return basis up to the 192 amount of tax imposed upon the consolidated group. Any eligible 193 cost for which a credit is claimed and which is deducted or 194 otherwise reduces federal taxable income shall be added back in 195 computing adjusted federal income under s. 220.13. 196 (b) For tax years beginning on or after January 1, 2011, a 197 credit against the tax imposed by this chapter shall be granted 198 in an amount equal to the eligible costs defined in subparagraph 199 (1)(c)4. The credits may be used in tax years beginning January 200 1, 2011, and ending December 31, 2016, after which the credit 201 shall expire. If the credit is not fully used in any one tax 202 year because of insufficient tax liability on the part of the 203 corporation, the unused amount may be carried forward and used 204 in tax years beginning January 1, 2010, and ending December 31, 205 2021, after which the credit carryover expires and may not be 206 used. A taxpayer that files a consolidated return in this state 207 as a member of an affiliated group under s. 220.131(1) may be 208 allowed the credit on a consolidated return basis up to the 209 amount of tax imposed upon the consolidated group. Any eligible 210 cost for which a credit is claimed and which is deducted or 211 otherwise reduces federal taxable income shall be added back in 212 computing adjusted federal income under s. 220.13. 213 Section 3. Paragraphs (b) and (g) of subsection (3) of 214 section 220.193, Florida Statutes, are amended to read: 215 220.193 Florida renewable energy production credit.— 216 (3) An annual credit against the tax imposed by this 217 section shall be allowed to a taxpayer, based on the taxpayer’s 218 production and sale of electricity from a new or expanded 219 Florida renewable energy facility. For a new facility, the 220 credit shall be based on the taxpayer’s sale of the facility’s 221 entire electrical production. For an expanded facility, the 222 credit shall be based on the increases in the facility’s 223 electrical production that are achieved after May 1, 2006. 224 (b) The credit may be claimed for electricity produced and 225 sold on or after January 1, 2007. Beginning in 2008 and 226 continuing until 20172011, each taxpayer claiming a credit 227 under this section must first apply to the department by 228 February 1 of each year for an allocation of available credit. 229 The department, in consultation with the commission, shall 230 develop an application form. The application form shall, at a 231 minimum, require a sworn affidavit from each taxpayer certifying 232 the increase in production and sales that form the basis of the 233 application and certifying that all information contained in the 234 application is true and correct. 235 (g) Notwithstanding any other provision of this section, 236 credits for the production and sale of electricity from a new or 237 expanded Florida renewable energy facility may be earned between 238 January 1, 2007, and June 30, 20172010. The combined total 239 amount of tax credits which may be granted for all taxpayers 240 under this section is limited to $250$5million per state 241 fiscal year. 242 Section 4. Subsection (1) of section 366.02, Florida 243 Statutes, is amended to read: 244 366.02 Definitions.—As used in this chapter: 245 (1) “Public utility” means every person, corporation, 246 partnership, association, or other legal entity and their 247 lessees, trustees, or receivers supplying electricity or gas 248 (natural, manufactured, or similar gaseous substance) to or for 249 the public within this state.; butThe term“public utility”250 does not include:either251 (a) A cooperative now or hereafter organized and existing 252 under the Rural Electric Cooperative Law of the state; 253 (b) A municipality or any agency thereof; 254 (c) Any dependent or independent specialnatural gas255 district, including special natural gas districts; 256 (d) Any natural gas transmission pipeline company making 257 only sales or transportation delivery of natural gas at 258 wholesale and to direct industrial consumers; 259 (e) Any entity selling or arranging for sales of natural 260 gas which neither owns nor operates natural gas transmission or 261 distribution facilities within the state;or262 (f) A person supplying liquefied petroleum gas, in either 263 liquid or gaseous form, irrespective of the method of 264 distribution or delivery, or owning or operating facilities 265 beyond the outlet of a meter through which natural gas is 266 supplied for compression and delivery into motor vehicle fuel 267 tanks or other transportation containers, unless such person 268 also supplies electricity or manufactured or natural gas; or.269 (g) The developer of a renewable energy generation facility 270 that has an aggregate gross power rating of 5 megawatts, 271 measured on an alternating current basis, or less; that is 272 located on the premises of a host consumer or group of host 273 consumers, including, without limitation, residential, 274 commercial, industrial, institutional, or agricultural host 275 customers located on the same or contiguous property, all 276 subject to the aggregate gross power limitation; and that 277 supplies electricity exclusively for sale to the host consumer 278 or consumers for consumption on the premises only and contiguous 279 property owned or leased by the host consumer or consumers, 280 regardless of interruptions in contiguity caused by easements, 281 public thoroughfares, transportation rights-of-way, or utility 282 rights-of-way. 283 Section 5. Section 366.90, Florida Statutes, is created to 284 read: 285 366.90 Renewable energy for electricity production.—In 286 furtherance of the energy policy goals established in s. 287 377.601, the Legislature finds that it is in the public interest 288 to promote the development of renewable energy resources in the 289 state, for purposes of electricity production, through the 290 provisions of ss. 366.91 and 366.92. The Legislature further 291 finds that renewable energy resources have the potential to help 292 diversify fuel types to alleviate the state’s growing dependence 293 on natural gas and other fossil fuels for the production of 294 electricity, minimize the volatility of fuel costs, encourage 295 investment within the state, promote the state’s energy 296 independence and long-term economic and environmental 297 sustainability, reduce the net outflow of energy expenditures, 298 improve environmental conditions, and make the state a leader in 299 new and innovative technologies. 300 Section 6. Subsection (2) of section 366.91, Florida 301 Statutes, is amended to read: 302 366.91 Renewable energy.— 303 (2) As used in this section, the term: 304 (a) “Biomass,” when used asmeansa power source, means any 305 organic material that is available on a renewable or recurring 306 basis and that is comprised of, but is not limited to, 307 combustible residues or gases from forest products 308 manufacturing, waste, byproducts, or products from agricultural 309 and orchard crops, waste or coproducts from livestock and 310 poultry operations, waste or byproducts from food processing, 311 recycling byproducts from the recycling of source materials that 312 are not derived from fossil fuels, urban wood waste, municipal 313 solid waste, municipal liquid waste treatment operations, and 314 landfill gas. 315 (b) “Customer-owned renewable generation” means an electric 316 generating system located on a customer’s premises that is 317 primarily intended to offset part or all of the customer’s 318 electricity requirements with renewable energy. 319 (c) “Net metering” means a metering and billing methodology 320 whereby customer-owned renewable generation is allowed to offset 321 the customer’s electricity consumption on site, and the 322 customer’s site includes all of the customer’s energy usage 323 accounts located on contiguous property owned by the same 324 customer. 325 (d) “Renewable energy” means electrical energy produced 326 from a method that uses one or more of the following fuels or 327 energy sources: hydrogen produced from sources other than fossil 328 fuels, biomass, solar energy, geothermal energy, wind energy, 329 ocean energy, and hydroelectric power. The term includes the 330 alternative energy resource, waste heat, from sulfuric acid 331 manufacturing operationsand electrical energy produced using332pipeline-quality synthetic gas produced from waste petroleum333coke with carbon capture and sequestration. 334 Section 7. Section 366.92, Florida Statutes, is amended to 335 read: 336 366.92 Florida renewable energy policy.— 337 (1) It is the intent of the Legislature to promote the 338 development of renewable energy; protect the economic viability 339 of Florida’s existing renewable energy facilities; diversify the 340 types of fuel used to generate electricity in Florida; lessen 341 Florida’s dependence on natural gas and fuel oil for the 342 production of electricity; minimize the volatility of fuel 343 costs; encourage investment within the state; improve 344 environmental conditions; and, at the same time, minimize the 345 costs of the conventional and renewable power supply to electric 346 utilities and their customers while promoting Florida-based 347 renewable energy production consistent with the state’s energy 348 policy. 349 (2) As used in this section, the term: 350 (a) “Florida renewable energy resources” means renewable 351 energy, as defined in s. 377.803, that is produced in Florida. 352 (b) “Provider” means a “utility” as defined in s. 353 366.8255(1)(a). 354 (c) “Renewable energy” means renewable energy as defined in 355 s. 366.91(2)(d)which is produced in this state. 356(d) “Renewable energy credit” or “REC” means a product that357represents the unbundled, separable, renewable attribute of358renewable energy produced in Florida and is equivalent to 1359megawatt-hour of electricity generated by a source of renewable360energy located in Florida.361(e) “Renewable portfolio standard” or “RPS” means the362minimum percentage of total annual retail electricity sales by a363provider to consumers in Florida that shall be supplied by364renewable energy produced in Florida.365 (3) Subject to the provisions of this subsection, in order 366 to provide for the most cost-effective development and 367 deployment of renewable energy resources in this state, the 368 commission shall provide for the full cost recovery under the 369 environmental cost-recovery clause of all reasonable and prudent 370 costs incurred by a provider to produce or purchase, pursuant to 371 the provisions of this section, renewable energy for the 372 purposes of supplying electrical energy to its retail customers. 373 (a) Each provider shall purchase renewable energy pursuant 374 to a standard form contract for the purchase of renewable energy 375 from different types of renewable energy facilities located in 376 Florida. 377 1. The price to be paid for renewable energy purchased 378 through a standard form contract shall be expressed in a 379 levelized, or constant, price per kilowatt hour for the term of 380 the contract. The price shall be determined by a competitive 381 auction conducted by an independent auction administrator 382 engaged by the commission to ensure the objectivity and fairness 383 of the auction. The provider shall reimburse the commission for 384 the cost for the independent auction administrator, and the cost 385 is recoverable by the provider through the environmental cost 386 recovery clause. 387 2. The terms and conditions of the standard form contract 388 shall be determined pursuant to the hearing conducted by the 389 commission before the issuance of such contract and the conduct 390 of the auction provided for in this paragraph. 391 3. For a renewable electric generating facility to be 392 eligible to participate in the auction, a renewable energy 393 supplier’s facility must be located in Florida. 394 4. To ensure the timely construction of renewable energy 395 projects, the standard contract must contain the following 396 provisions: 397 a. A $20 per kilowatt development deposit for systems of 398 100 kilowatts or less, payable within 30 days after the contract 399 is executed by both the supplier and the purchasing utility. 400 b. A $30 per kilowatt development deposit for systems above 401 100 kilowatts, payable within 30 days after the contract is 402 executed by both the supplier and the purchasing utility. 403 5. Solar projects that are not operational within 18 months 404 after the contract is executed and non-solar projects that are 405 not operational within 36 months after the contract is executed 406 are subject to contract termination. Termination is not 407 automatic, and notice and the opportunity for a hearing must be 408 provided prior to termination. Project delays due to regulatory 409 processes outside the developer’s control may not be the basis 410 for contract termination. 411 6. A contract shall be for a minimum term of 20 years and a 412 maximum term of 30 years, with the term in years to be among the 413 terms and conditions to be established by the commission 414 pursuant to the hearing provided for in this paragraph. 415 (b) Each provider must offer, as its minimum, a standard 416 form contract for each of the following types and size classes 417 of renewable energy technologies: 418 1. Large (greater than 1,000 kilowatts), medium (greater 419 than 100 kilowatts but less than or equal to 999 kilowatts) and 420 small (less than or equal to 100 kilowatts) solar electric 421 technologies, including photovoltaic, solar thermoelectric, and 422 solar thermal generating technologies, as well as other electric 423 production technologies that convert solar energy into 424 electricity, and also including fuel cells that are fueled by 425 hydrogen produced from hydrolysis of water using electricity 426 produced by solar technologies; 427 2. Large (greater than 100 kilowatts) and small (less than 428 or equal to 100 kilowatts) wind technologies; 429 3. Large (greater than 100 kilowatts) and small (less than 430 or equal to 100 kilowatts) hydroelectric technologies, including 431 technologies that utilize the energy in waves, ocean currents, 432 and thermal energy differentials; 433 4. Large (greater than or equal to 10 megawatts), medium 434 sized (greater than 100 kilowatts but less than 10 megawatts), 435 and small (less than or equal to 100 kilowatts) biomass 436 technologies and applications of no more than 10 megawatts net 437 output capacity; and 438 5. Large (greater than 100 kilowatts) and small (less than 439 or equal to 100 kilowatts) waste heat technologies. 440 (c) Each provider shall purchase in 2012 and in each 441 calendar year thereafter 2 percent of the provider’s total 442 retail revenues for renewable energy. The purchase is in 443 addition to the provider’s avoided as-available energy cost for 444 the energy purchased. The provider’s total retail revenues 445 include all cost adjustment, cost recovery, and similar add-on 446 charges collected by the provider in the preceding calendar 447 year. However, the total retail revenues exclude only franchise 448 fee revenues. Ten percent of the amount designated for each 449 technology type shall be reserved for small renewable energy 450 production facilities of the respective technology. A provider 451 may expend in any year up to an additional 1 percent above the 452 minimum amounts required in this subsection of the provider’s 453 total retail revenues, including all cost adjustment, cost 454 recovery, and similar add-on charges, collected by the provider 455 in the preceding calendar year, excluding only franchise fee 456 revenues. 457 (d)1. The commission shall require that a minimum of 25 458 percent of the total funding to be expended by each provider on 459 the purchase of solar energy. Each utility shall make available 460 a minimum of 10 percent of the utility’s applicable amount for 461 small solar suppliers and a minimum of 20 percent of the 462 utility’s applicable amount for medium solar suppliers. The 463 commission may establish minimum percentages of the funding that 464 is to be expended for renewable energy for wind energy and other 465 renewable energy technologies. 466 2. If the bids received from the auction are insufficient 467 to expend the total amount of funds available, the residual 468 funds are available for either technologies other than the 469 under-subscribed technologies or to be carried forward and 470 expended on a pro rata basis over the succeeding 4 years. 471 (e) Each provider may elect to provide up to, but no more 472 than, 25 percent of the total amount of renewable energy to be 473 purchased for each technology type listed in paragraph (b). If 474 the provider elects this option, the provider’s cost recovery 475 shall be limited to the lowest price bid by any respondent in 476 the auction for supplying renewable energy of the respective 477 technology type for the life of the commitment. 478 (f) After a contract is executed or the provider has 479 elected to provide a portion of the renewable energy under 480 paragraph (c), the provider may not recover costs any greater 481 than the contract price or the price determined under paragraph 482 (c). 483 (g) Each provider may recover through the environmental 484 cost-recovery clause an amount equal to 0.005 percent of all 485 moneys paid to unaffiliated renewable energy producers to 486 purchase renewable energy. 487 (h) A provider may recover only the costs for new 488 construction or conversion projects for which construction 489 commenced on or after July 1, 2011, and for purchases made on or 490 after that date. All renewable energy projects for which costs 491 are approved by the commission for recovery through the 492 environmental cost-recovery clause before July 1, 2011, are not 493 subject to or included in the calculation pursuant to paragraph 494 (c). 495 (i) In a proceeding to recover costs, a provider must 496 provide to the commission all cost information, hourly energy 497 production information, and other information deemed relevant by 498 the commission with respect to each project. 499 (j) If a provider purchases renewable energy at a cost in 500 excess of its full avoided cost, the seller must surrender to 501 the provider all renewable attributes of the renewable energy 502 purchased. 503 (k) Revenues derived from any renewable energy credit, 504 carbon credit, green tag credit, renewable energy attribute, or 505 any other mechanism that attributes value to the production of 506 renewable energy, either existing or hereafter devised, and 507 received by a provider by virtue of the production or purchase 508 of renewable energy for which cost recovery is approved, shall 509 be shared with the provider’s ratepayers such that the 510 ratepayers are credited at least 95 percent of such revenues. 511 However, the provider is not required to share with its 512 ratepayers any value derived from credits received by the 513 provider by virtue of the purchase of renewable energy from a 514 third-party generating facility in the state which does not 515 exceed 2 megawatts in capacity and is not a regulated utility or 516 its unregulated affiliate. 517 (l) A renewable energy generating facility that is 518 constructed by a renewable energy supplier or by a provider to 519 provide renewable energy is not subject to s. 403.519. The 520 commission is not required to submit a report for the project 521 pursuant to s. 403.507(4)(a). 522 (4) Each provider shall, in its 10-year site plan submitted 523 to the commission, provide the following information: 524 (a) The amount of renewable energy resources the provider 525 produces or purchases. 526 (b) The amount of renewable energy resources the provider 527 plans to produce or purchase over the 10-year planning horizon 528 and the means by which such production or purchases will be 529 achieved. 530 (c) A statement indicating how the production and purchase 531 of renewable energy resources impact the provider’s present and 532 future capacity and energy needs. 533(3) The commission shall adopt rules for a renewable534portfolio standard requiring each provider to supply renewable535energy to its customers directly, by procuring, or through536renewable energy credits. In developing the RPS rule, the537commission shall consult the Department of Environmental538Protection and the Florida Energy and Climate Commission. The539rule shall not be implemented until ratified by the Legislature.540The commission shall present a draft rule for legislative541consideration by February 1, 2009.542(a) In developing the rule, the commission shall evaluate543the current and forecasted levelized cost in cents per kilowatt544hour through 2020 and current and forecasted installed capacity545in kilowatts for each renewable energy generation method through5462020.547(b) The commission’s rule:5481. Shall include methods of managing the cost of compliance549with the renewable portfolio standard, whether through direct550supply or procurement of renewable power or through the purchase551of renewable energy credits. The commission shall have552rulemaking authority for providing annual cost recovery and553incentive-based adjustments to authorized rates of return on554common equity to providers to incentivize renewable energy.555Notwithstanding s.366.91(3) and (4), upon the ratification of556the rules developed pursuant to this subsection, the commission557may approve projects and power sales agreements with renewable558power producers and the sale of renewable energy credits needed559to comply with the renewable portfolio standard. In the event of560any conflict, this subparagraph shall supersede s.366.91(3) and561(4). However, nothing in this section shall alter the obligation562of each public utility to continuously offer a purchase contract563to producers of renewable energy.5642. Shall provide for appropriate compliance measures and565the conditions under which noncompliance shall be excused due to566a determination by the commission that the supply of renewable567energy or renewable energy credits was not adequate to satisfy568the demand for such energy or that the cost of securing569renewable energy or renewable energy credits was cost570prohibitive.5713. May provide added weight to energy provided by wind and572solar photovoltaic over other forms of renewable energy, whether573directly supplied or procured or indirectly obtained through the574purchase of renewable energy credits.5754. Shall determine an appropriate period of time for which576renewable energy credits may be used for purposes of compliance577with the renewable portfolio standard.5785. Shall provide for monitoring of compliance with and579enforcement of the requirements of this section.5806. Shall ensure that energy credited toward compliance with581the requirements of this section is not credited toward any582other purpose.5837. Shall include procedures to track and account for584renewable energy credits, including ownership of renewable585energy credits that are derived from a customer-owned renewable586energy facility as a result of any action by a customer of an587electric power supplier that is independent of a program588sponsored by the electric power supplier.5898. Shall provide for the conditions and options for the590repeal or alteration of the rule in the event that new591provisions of federal law supplant or conflict with the rule.592(c) Beginning on April 1 of the year following final593adoption of the commission’s renewable portfolio standard rule,594each provider shall submit a report to the commission describing595the steps that have been taken in the previous year and the596steps that will be taken in the future to add renewable energy597to the provider’s energy supply portfolio. The report shall598state whether the provider was in compliance with the renewable599portfolio standard during the previous year and how it will600comply with the renewable portfolio standard in the upcoming601year.602(4)In order to demonstrate the feasibility and viability603of clean energy systems, the commission shall provide for full604cost recovery under the environmental cost-recovery clause of605all reasonable and prudent costs incurred by a provider for606renewable energy projects that are zero greenhouse gas emitting607at the point of generation, up to a total of 110 megawatts608statewide, and for which the provider has secured necessary609land, zoning permits, and transmission rights within the state.610Such costs shall be deemed reasonable and prudent for purposes611of cost recovery so long as the provider has used reasonable and612customary industry practices in the design, procurement, and613construction of the project in a cost-effective manner614appropriate to the location of the facility. The provider shall615report to the commission as part of the cost-recovery616proceedings the construction costs, in-service costs, operating617and maintenance costs, hourly energy production of the renewable618energy project, and any other information deemed relevant by the619commission. Any provider constructing a clean energy facility620pursuant to this section shall file for cost recovery no later621than July 1, 2009.622 (5) Each municipal electric utility and rural electric 623 cooperative shall develop standards for the promotion, 624 encouragement, and expansion of the use of renewable energy 625 resources and energy conservation and efficiency measures. On or 626 before April 1, 2009, and annually thereafter, each municipal 627 electric utility and electric cooperative shall submit to the 628 commission a report that identifies such standards. 629 (6) Nothing in this section shall be construed to impede or 630 impair terms and conditions of existing contracts. 631 (7) To further promote renewable energy, any expansion of 632 an existing renewable energy electric generating facility, 633 subject to a total of up to 200 net megawatts statewide, for 634 which a site certification application is filed before January 635 1, 2011, and which is owned by a local government entity, does 636 not require a determination of need pursuant to s. 403.519. 637 (8)(a) A developer of renewable energy generation may 638 locate, own, and operate a renewable energy generation facility 639 that has an aggregate gross power rating of 5 megawatts or less, 640 measured on an alternating current basis, on the premises of a 641 host consumer or group of host consumers, including, without 642 limitation, residential, commercial, industrial, institutional, 643 or agricultural host customers located on the same or contiguous 644 property, all subject to the aggregate gross power limitation, 645 and supply electricity exclusively for sale to the host consumer 646 for consumption only on the premises or contiguous property 647 owned or leased by the host consumer, regardless of 648 interruptions in contiguity caused by easements, public 649 thoroughfares, transportation rights-of-way, or utility rights 650 of-way. 651 (b) Interconnection, metering, and standby and supplemental 652 service must be available to the host consumer served by 653 renewable generation facilities on the same basis as if the host 654 consumer owned and operated the renewable generation facilities 655 themselves. 656 (c) The developer of renewable energy must annually provide 657 to the commission the following information: 658 1. The size and location of each renewable energy 659 generation facility planned. 660 2. The identity and historical and projected load 661 characteristics of each host consumer. 662 3. The actual production and use of renewable electricity 663 by facilities installed. 664 (d) Beginning January 1, 2013, and at least once every 12 665 months thereafter, the commission shall report to the President 666 of the Senate and the Speaker of the House of Representatives on 667 activity under this subsection and the impacts of renewable 668 energy generation activity on the electric power grid of the 669 state, the individual utility systems, and each utility’s 670 general body of ratepayers, and shall make recommendations 671 concerning implementation of this program. 672 (9)(7)The commission may adopt rules to administer and 673 implement the provisions of this section. 674 Section 8. Section 377.601, Florida Statutes, is amended to 675 read: 676 377.601 Legislative intent.— 677 (1) The purpose of the state’s energy policy is to ensure 678 adequate, reliable, cost-effective, and sustainable energy 679 supplies for the state in a manner that: promotes sustainable 680 economic growth; reduces Florida’s dependence on fuels from 681 outside the state; maximizes, within the limitations set forth 682 in applicable provisions of law, the use of Florida-based 683 renewable energy resources to produce electricity and 684 transportation fuels; ensures that renewable energy resources 685 are procured, to the maximum extent possible, using fair, 686 transparent, and competitive purchase systems; and minimizes and 687 mitigates any adverse impacts on human health and welfare, and 688 on Florida’s environment, to the maximum extent practicable and 689 subject to the limitations set forth in applicable provisions of 690 state law. The Legislature intends that the state’s energy 691 policy, and all decisions made by all state agencies impacting 692 the state’s energy policy, be efficiently directed toward 693 achieving these purposes. 694 (2) In furtherance of these purposes, the state’s energy 695 policy shall be implemented through effective, efficient, and 696 reliable governance and shall be guided by the following goals 697 in order of their priority: 698 (a) Ensuring an affordable energy supply. 699 (b) Ensuring an adequate and sustainable energy supply and 700 a Florida-based energy production capacity. 701 (c) Ensuring a secure and reliable energy supply. 702 (d) Minimizing energy cost volatility and the state’s long 703 term exposure to volatility and increases in world energy 704 prices. 705 (e) Minimizing the negative impacts of energy production on 706 the state’s environment, social fabric, and the public health 707 and welfare. 708 (f) Maximizing economic synergies for the state associated 709 with its energy policy. 710 (g) Reducing the net export of energy expenditures by 711 maximizing the use of Florida-based renewable energy resources 712 to meet the state’s energy needs. 713 (3)(1)The Legislature finds that the state’s energy 714 security can be increased by lessening dependence on foreign 715 oil; that the impacts of global climate change can be reduced 716 through the reduction of greenhouse gas emissions; and that the 717 implementation of alternative energy technologies can be a 718 source of new jobs and employment opportunities for many 719 Floridians. The Legislature further finds that the state is 720 positioned at the front line against potential impacts of global 721 climate change. Human and economic costs of those impacts can be 722 averted by global actions and, where necessary, adapted to by a 723 concerted effort to make Florida’s communities more resilient 724 and less vulnerable to these impacts. In focusing the 725 government’s policy and efforts to benefit and protect our 726 state, its citizens, and its resources, the Legislature believes 727 that a single government entity with a specific focus on energy 728 and climate change is both desirable and advantageous. Further, 729 the Legislature finds that energy infrastructure provides the 730 foundation for secure and reliable access to the energy supplies 731 and services on which Florida depends. Therefore, there is 732 significant value to Florida consumers that comes from 733 investment in Florida’s energy infrastructure that increases 734 system reliability, enhances energy independence and 735 diversification, stabilizes energy costs, and reduces greenhouse 736 gas emissions. 737 (4)(2)It is further the policy of the stateof Floridato: 738 (a) Develop and promote the effective use of energy in the 739 state, discourage all forms of energy waste, and recognize and 740 address the potential of global climate change wherever 741 possible. 742 (b) Play a leading role in developing and instituting 743 energy management programs aimed at promoting energy 744 conservation, energy security, and the reduction of greenhouse 745 gas emissions. 746 (c) Include energy considerations consistent with the 747 state’s energy policy in all state, regional, and local planning 748 decisions, as well as in all decisions by state agencies. 749 (d) Utilize and manage effectively energy resources used 750 within state agencies. 751 (e) Encourage local governments to include energy 752 considerations in all planning and to support their work in 753 promoting energy management programs. 754 (f) Include the full participation of citizens in the 755 development and implementation of energy programs. 756 (g) Consider in its decisions the energy needs of each 757 economic sector, including residential, industrial, commercial, 758 agricultural, and governmental uses, and reduce those needs 759 whenever possible. 760 (h) Promote energy education and the public dissemination 761 of information on the use and consumption of energy and its 762 environmental, economic, and social impactsimpact. 763 (i) Encourage the research, development, demonstration, and 764 application of alternative energy resources, particularly 765 renewable energy resources. 766 (j) Consider, in its decisionmaking, the social, economic, 767 and environmental impacts of energy-related activities, 768 including the whole-life-cycle impacts of any potential energy 769 use choices, so that detrimental effects of these activities are 770 understood and minimized. 771 (k) Develop and maintain energy emergency preparedness 772 plans to minimize the effects of an energy shortage within 773 Florida. 774 Section 9. Subsection (1) and paragraph (f) of subsection 775 (2) of section 377.703, Florida Statutes, are amended to read: 776 377.703 Additional functions of the Florida Energy and 777 Climate Commission.— 778 (1) LEGISLATIVE INTENT.—Recognizing that energy supply and 779 demand questions have become a major area of concern to the 780 state which must be dealt with by effective and well-coordinated 781 state action, it is the intent of the Legislature to promote the 782 efficient, effective, and economical management of energy 783 problems, centralize energy coordination responsibilities, 784 pinpoint responsibility for conducting energy programs, and 785 ensure the accountability of state agencies for the 786 implementation of s. 377.601s.377.601(2), the state energy 787 policy. It is the specific intent of the Legislature that 788 nothing in this act shall in any way change the powers, duties, 789 and responsibilities assigned by the Florida Electrical Power 790 Plant Siting Act, part II of chapter 403, or the powers, duties, 791 and responsibilities of the Florida Public Service Commission. 792 (2) FLORIDA ENERGY AND CLIMATE COMMISSION; DUTIES.—The 793 commission shall perform the following functions consistent with 794 the development of a state energy policy: 795 (f) The commission shall submit an annual report to the 796 Governor and the Legislature reflecting its activities and 797 making recommendations of policies for improvement of the 798 state’s response to energy supply and demand and its effect on 799 the health, safety, and welfare of the people of Florida. The 800 report shall include a report from the Florida Public Service 801 Commission on electricity and natural gas and information on 802 energy conservation programs conducted and underway in the past 803 year and shall include recommendations for energy conservation 804 programs for the state, including, but not limited to, the 805 following factors: 806 1. Formulation of specific recommendations for improvement 807 in the efficiency of energy utilization in governmental, 808 residential, commercial, industrial, and transportation sectors. 809 2. Collection and dissemination of information relating to 810 energy conservation. 811 3. Development and conduct of educational and training 812 programs relating to energy conservation. 813 4. An analysis of the ways in which state agencies are 814 seeking to implement s. 377.601s.377.601(2), the state energy 815 policy, and recommendations for better fulfilling this policy. 816 Section 10. Present subsections (3) and (4) of section 817 377.809, Florida Statutes, are renumbered as subsections (4) and 818 (5), respectively, and a new subsection (3) is added to that 819 section to read: 820 377.809 Energy Economic Zone Pilot Program.— 821 (3) The Department of Community Affairs, in consultation 822 with the Florida Energy and Climate Commission, shall implement 823 an Energy Economic Zone Pilot Program for the purpose of 824 developing a model to assist communities in attracting renewable 825 energy technology, energy efficiency technology, and biofuel 826 technology industries that are focused on bringing research and 827 development projects to large-scale production. The Office of 828 Tourism, Trade, and Economic Development shall provide technical 829 assistance in obtaining additional or supplemental financing and 830 in developing and administering the program. 831 (a) The application for the pilot project shall: 832 1. Identify the proposed location of the energy economic 833 zone, which must have a significant workforce population that is 834 at risk as a result of reduced or eliminated federal funding. 835 2. Present a proposed strategic plan for development and 836 redevelopment in the energy economic zone. 837 3. Demonstrate consistency of the strategic plan with the 838 local comprehensive plan or include proposed plan amendments 839 necessary to achieve consistency. 840 (b) The Department of Community Affairs must grant at least 841 one application if the application meets the requirements of 842 this subsection and the community has demonstrated a prior 843 commitment to technology development. The Department of 844 Community Affairs, the Florida Energy and Climate Commission, 845 and the Office of Tourism, Trade, and Economic Development shall 846 provide the pilot community with technical assistance in 847 identifying and qualifying for eligible grants and credits in 848 job creation, energy development, and other areas of 849 development, and encourage businesses to locate within the 850 energy economic zone. 851 Section 11. Subsection (14) of section 403.503, Florida 852 Statutes, is amended to read: 853 403.503 Definitions relating to Florida Electrical Power 854 Plant Siting Act.—As used in this act: 855 (14) “Electrical power plant” means, for the purpose of 856 certification, any steamor solarelectrical generating facility 857 using any process or fuel, including nuclear materials, except 858 that this term does not include any steamor solarelectrical 859 generating facility of less than 75 megawatts in capacity or any 860 solar or biomass electrical generating facility of any sized 861 capacity unless the applicant for such a facility elects to 862 apply for certification under this act. This term also includes 863 the site; all associated facilities that will be owned by the 864 applicant that are physically connected to the site; all 865 associated facilities that are indirectly connected to the site 866 by other proposed associated facilities that will be owned by 867 the applicant; and associated transmission lines that will be 868 owned by the applicant which connect the electrical power plant 869 to an existing transmission network or rights-of-way to which 870 the applicant intends to connect. At the applicant’s option, 871 this term may include any offsite associated facilities that 872 will not be owned by the applicant; offsite associated 873 facilities that are owned by the applicant but that are not 874 directly connected to the site; any proposed terminal or 875 intermediate substations or substation expansions connected to 876 the associated transmission line; or new transmission lines, 877 upgrades, or improvements of an existing transmission line on 878 any portion of the applicant’s electrical transmission system 879 necessary to support the generation injected into the system 880 from the proposed electrical power plant. 881 Section 12. If any provision of this act or the application 882 thereof to any person or circumstance is held invalid, the 883 invalidity does not affect other provisions or applications of 884 the act that may be given effect without the invalid provision 885 or application, and to this end the provisions of this act are 886 declared to be severable. 887 Section 13. This act shall take effect upon becoming a law.