Revision: Jan. 18, 2019, 2:50 p.m.
SB 122-FN - AS INTRODUCED
2019 SESSION
19-0834
10/05
SENATE BILL 122-FN
AN ACT relative to expenditures from the energy efficiency fund.
SPONSORS: Sen. Fuller Clark, Dist 21; Sen. Hennessey, Dist 5; Sen. Levesque, Dist 12; Sen. Feltes, Dist 15; Sen. Sherman, Dist 24; Rep. Balch, Hills. 38; Rep. Cali-Pitts, Rock. 30; Rep. McGhee, Hills. 40
COMMITTEE: Energy and Natural Resources
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ANALYSIS
This bill:
I. Requires the public utilities commission to allocate certain funds to school districts for energy efficiency projects.
II. Repeals a rebate to retail electric ratepayers.
III. Requires the public utilities commission and the department of environmental services to submit a report with recommendations for allocations of auction proceeds.
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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Matter which is either (a) all new or (b) repealed and reenacted appears in regular type.
19-0834
10/05
STATE OF NEW HAMPSHIRE
In the Year of Our Lord Two Thousand Nineteen
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, III to read as follows:
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 utility core energy efficiency program.
(b) Beginning January 1, [2014] 2020, [up to $2,000,000] no more than $5,000,000 annually to utility core energy efficiency 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,] through 2019 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] 2020, 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.
(c) The remainder to [all-fuels, comprehensive energy efficiency programs] programs for reducing carbon emissions in the transportation sector 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 for reducing carbon emissions in the transportation sector.
(5) Ability to reach out to customers.
(6) The validity of the energy saving assumptions described in the bid.
2 Review and Report. The public utilities commission and the department of environmental services shall review the use of auction proceeds under RSA 125-O:23, III and shall submit a report, with recommendations to continue or revise the allocation of auction proceeds among the core programs based on program needs, to the house and senate finance committees, the speaker of the house of representatives, the president of the senate, the house clerk, the senate clerk, and director of legislative services on or before July 1, 2023.
3 Repeal. The following are repealed:
I. RSA 125-O:23, II, relative to rebates to retail electric ratepayers.
II. RSA 125-O:23, IV and V, relative to use of remaining proceeds received by the state from the sale of allowances.
4 Effective Date. This act shall take effect 60 days after its passage.
19-0834
1/15/19
SB 122-FN- FISCAL NOTE
AS INTRODUCED
AN ACT relative to expenditures from the energy efficiency fund.
FISCAL IMPACT: [ X ] State [ X ] County [ X ] Local [ ] None
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| Estimated Increase / (Decrease) | |||
STATE: | FY 2020 | FY 2021 | FY 2022 | FY 2023 |
Appropriation | $0 | $0 | $0 | $0 |
Revenue | $0 | $0 | $0 | $0 |
Expenditures | $100,000 | $100,000 | $100,000 | $100,000 |
Funding Source: | [ X ] General [ ] Education [ X ] Highway [ X ] Other - Energy Efficiency Fund, Multiple Others (See Methodology) | |||
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COUNTY: |
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Revenue | Indeterminable Increase | Indeterminable Increase | Indeterminable Increase | Indeterminable Increase |
Expenditures | Indeterminable Increase | Indeterminable Increase | Indeterminable Increase | Indeterminable Increase |
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LOCAL: |
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Revenue | Indeterminable Increase | Indeterminable Increase | Indeterminable Increase | Indeterminable Increase |
Expenditures | Indeterminable Increase | Indeterminable Increase | Indeterminable Increase | Indeterminable Increase |
METHODOLOGY:
This bill would repeal the $1 per allowance amount deposited into the Energy Efficiency Fund. Instead, all proceeds from the sale of allowances would be deposited into the Energy Efficiency Fund for specific programs and the provision in current law to rebate all electric ratepayers with any revenue above the $1 per allowance would end. Below is an estimate from the Public Utilities Commission and Department of Environmental Services of how this bill will impact the allocation of auction revenue based on the assumption that net auction revenue from the sale of allowances will be $13.65 million in FY 2020 and each year thereafter:
Current Law | Current Allocation of Revenue | Proposed Changes | Proposed Allocation of Revenue | Net Estimated Change |
Low-income Core Energy Efficiency Program (15%) | $440,000 | Low-income Utility Core Energy Efficiency Program (35%)
| $4.8 Million | $4.4 Million |
Energy Efficiency Program (only municipalities) | $2 Million | Energy Efficiency Program (municipalities + school districts)
| $5 Million | $3 Million |
All-fuels Program (remaining balance of $1 per allowances) | $200,000 | All-fuels Program (remaining balance) | $3.8 Million | $3.6 Million |
Rebates to all electricity rate payers | $11 Million | Rebates to all electricity rate payers
| $0 | ($11 Million) |
Total | $13.6 Million |
| $13.6 Million | $0 |
Note: These estimates assume an average allowance price of $4.75.
This bill will have no impact on net state revenue, but will reallocate state revenue to energy efficiency programs from rebates to electricity rate payers. Therefore, the cost of electricity will increase generally for all state, county, and local governments that consume electricity. For example, the Commission and Department estimate the elimination of the rebates to all electricity rate payers will increase state electricity cost by $100,000, based on the state’s consumption of electricity in FY 2017. This increase in state electricity costs will impact all funds used to purchase electricity. The Commission and Department note that investments into energy efficiency may offset, in the future, any increase to electricity costs.
While local governments would directly receive a net revenue increase of $3 million, the total direct and indirect benefits to local and county governments will increase by an indeterminable amount.
AGENCIES CONTACTED:
Public Utilities Commission and Department of Environmental Services