Revision: Jan. 25, 2017, 3:40 p.m.
HB 559-FN - AS INTRODUCED
2017 SESSION
17-0470
06/04
HOUSE BILL 559-FN
AN ACT relative to expenditures from the energy efficiency fund.
SPONSORS: Rep. Richardson, Coos 4; Rep. Shepardson, Ches. 10; Rep. Backus, Hills. 19; Sen. Feltes, Dist 15; Sen. Fuller Clark, Dist 21
COMMITTEE: Science, Technology and Energy
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This bill modifies the allocation of rebates to retail electric customers.
This bill also requires the public utilities commission to allocate certain funds to school districts for energy efficiency projects.
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Explanation: Matter added to current law appears in bold italics.
Matter removed from current law appears [in brackets and struckthrough.]
Matter which is either (a) all new or (b) repealed and reenacted appears in regular type.
17-0470
06/04
STATE OF NEW HAMPSHIRE
In the Year of Our Lord Two Thousand Seventeen
AN ACT relative to expenditures from the energy efficiency fund.
Be it Enacted by the Senate and House of Representatives in General Court convened:
1 Regional Greenhouse Gas Initiative; Energy Efficiency Fund and Use of Auction Proceeds. Amend RSA 125-O:23, II and III to read as follows:
II. All amounts [in excess of the threshold price of $1 for any allowance sale] shall be allocated to the commercial and industrial retail electric customers and the residential retail electric customers consistent with the kilowatt-hour delivery sales of electric distribution utilities as determined by the commission. All of the commercial and industrial retail electric customer allocations shall be rebated to all [retail electric ratepayers] commercial and industrial retail customers in the state on a per-kilowatt-hour basis, in a timely manner to be determined by the commission.
III. All remaining proceeds received by the state from the sale of allowances, excluding the amount used for commission and department administration under paragraph I, shall be allocated by the commission as follows:
(a) At least [15] 35 percent to the low-income core energy efficiency program.
(b) Beginning January 1, [2014] 2017, up to [$2,000,000] $5,000,000 annually to utility core programs for municipal, school district, and local government energy efficiency projects, including projects by local governments that have their own municipal utilities. Funding elements shall include, but not be limited to, funding for direct technical and project management assistance to identify and encourage comprehensive projects and incentives structured to assist municipal and local governments funding energy efficiency projects. In calendar years 2014, 2015, [and] 2016, and 2017, any unused funds allocated to municipal and local government projects under this paragraph remaining at the end of the year shall roll over and be added to the new calendar year program funds and continue to be made available exclusively for municipal and local government projects. Beginning in calendar year [2017] 2018, and all subsequent years, funds allocated to municipal and local government projects under this paragraph shall be offered first to municipal and local governments as described in this paragraph for no less than 4 full calendar months. If, at the end of this time, municipal and local governments have not submitted requests for eligible projects that will expend the funds allocated to municipal and local government projects under this paragraph within that program year, the funds shall [be offered on a first-come, first-serve basis to business and municipal customers who fund the system benefits charge] go to a fuel neutral residential core energy efficiency program.
(c) The remainder to [all-fuels, comprehensive energy efficiency programs administered by qualified parties which may include electric distribution companies as selected through a competitive bid process. The funding shall be distributed among residential, commercial, and industrial customers based upon each customer class's electricity usage to the greatest extent practicable as determined by the commission. Bids shall be evaluated based on, but not limited to, the following criteria:]
(1) A benefit/cost ratio analysis including all fuels.
(2) Demonstrated ability to provide a comprehensive, fuel neutral program.
(3) Demonstrated infrastructure to effectively deliver such program.
(4) Experience of the bidder in administering energy efficiency programs.
(5) Ability to reach out to customers.
(6) The validity of the energy saving assumptions described in the bid] a fuel neutral residential core energy efficiency program.
2 Repeal. RSA 125-O:23, IV and V, relative to use of remaining proceeds received by the state from the sale of allowances is repealed.
3 Effective Date. This act shall take effect 60 days after its passage.
17-0470
1/14/17
HB 559-FN- FISCAL NOTE
as introduced
AN ACT relative to expenditures from the energy efficiency fund.
FISCAL IMPACT: [ X ] State [ ] County [ X ] Local [ ] None
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| Estimated Increase / (Decrease) | |||
STATE: | FY 2018 | FY 2019 | FY 2020 | FY 2021 |
Appropriation | $0 | $0 | $0 | $0 |
Revenue | $0 | $0 | $0 | $0 |
Expenditures | Indeterminable | Indeterminable | Indeterminable | Indeterminable |
Funding Source: | [ ] General [ ] Education [ ] Highway [ X ] Other | |||
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LOCAL: |
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Revenue | Indeterminable Increase | Indeterminable Increase | Indeterminable Increase | Indeterminable Increase |
Expenditures | Indeterminable | Indeterminable | Indeterminable | Indeterminable |
METHODOLOGY:
This bill modifies State law concerning the Regional Greenhouse Gas Initiative (RGGI) program by repealing the $1 per allowance rebate threshold for auction proceeds deposited into the Energy Efficiency Fund. Under the bill, all commercial and industrial retail electric ratepayers would receive a full rebate and residential customer rebates would end. Up to 35% of all remaining proceeds received by the State from the sale of allowances, after administrative costs, would be allocated to the low-income core energy efficiency program (current rate is 15%). Up to $5,000,000 annually would be allocated to municipal, school district, and local government energy efficiency projects under the core programs beginning January 1, 2017. Any remaining amounts would go to a fuel-neutral residential core energy efficiency program.
The Department of Environmental Services (DES) and the Public Utilities Commission (PUC) state this bill does not change gross restricted revenue to the energy efficiency fund. Current law provides for revenue in excess of $1 per allowance sold to be allocated by the PUC for rebates to all electric ratepayers on a per-kilowatt hour basis. DES and the PUC state that under this bill commercial and industrial ratepayers and state and local governmental units would receive a full rebate and the existing commercial and industrial efficiency program would no longer be supported with RGGI funds. Using a $14 million revenue estimate for FY 2018 and assuming commercial and industrial customers represent 60% of the total kilowatt-hour delivery sales of electric distribution utilities and residential customers represent 40%, approximately $8.4 million would be rebated back to the utilities for distribution to commercial and industrial customers in the form of a reduction to their monthly electric bill based on usage.
DES and the PUC state the bill ends rebates to residential customers and further redirects the use of "residential" RGGI revenues (estimated at $5.25 million). The termination of rebates will result in some minor increases in electricity costs which may be offset by energy efficiency investments and lower local taxes that could result from municipal and school energy efficiency investment. DES and the PUC estimate the $5.25 million of revenue would be allocated as follows in FY 2018:
DES and the PUC state that municipal, school district, and local government energy efficiency projects under the CORE energy efficiency programs would benefit these governmental entities in the form of incentives, loans, or spending on energy efficiency investments. Municipal, school district, and local government entities would also receive increased rebates and would gain both direct and indirect benefits in the long term due to increased energy efficiency funding.
DES and the PUC state that State governmental entities would gain additional rebates which could reduce direct expenditures for electricity. State agencies would no longer be eligible for direct energy efficiency benefits because the bill focuses all energy efficiency funding on low income residential, local governmental and residential customers.
The New Hampshire Municipal Association states this bill increases the amount to be distributed annually to municipal and school district energy efficiency projects from the sale of carbon allowances under the regional greenhouse gas initiative from approximately $2 to $5 million beginning in FY 2017. The Association expects there would be long-term reductions in local expenditures resulting from the increased funds.
The New Hampshire Association of Counties states this bill will have no fiscal impact on county budgets.
AGENCIES CONTACTED:
Department of Environmental Services, Public Utilities Commission, New Hampshire Municipal Association, and New Hampshire Association of Counties