On August 17, 2010, the Governor of Illinois, Pat Quinn, signed into law new legislation that is expected to help encourage solar energy development, increase the state’s solar energy use, and create new jobs in the state’s renewable energy industry. Referred to as the “Solar Ramp-Up Bill,” House Bill 6202 (“HB 6202”), which was sponsored by Rep. William Burns (D-Chicago) and Sen. Don Harmon (D-Oak Park), amends the Illinois Power Agency Act and the Public Utilities Act by changing the date by which certain utilities must begin purchasing solar energy as part of the state’s renewable energy portfolio from June 1, 2015, to June 1, 2012.
Although the state’s renewable portfolio standards applies to both the state’s alternative retail electric suppliers and investor-owned electric utilities, only investor-owned electric utilities supplying over 100,000 Illinois customers are affected by the “ramp-up.” As a result, only two utilities are affected by HB 6202, Commonwealth Edison and Ameren Corporation (the “Affected Utilities”).
The prior legislation required the Affected Utilities to procure 6% of its power from solar sources by June 1, 2015. Although the 6% threshold by June 1, 2015, is still in place, the Affected Utilities now have an additional requirement to purchase 0.5% of its power from solar energy by June 1, 2012, 1.5% by June 1, 2013, 3% by June 1, 2014, and 6% by June 1, 2015. Utilities that are not affected by HB 6202 are still required to procure 6% of its power from solar sources by June 1, 2015.
HB 6202 aims to “establish strengthened targets for utilities that will be purchasing more solar energy and help homeowners who want to increase their solar energy usage,” according to a press release issued by Governor Quinn. The Governor also acknowledges that “[s]olar energy is the wave of the future, and it is important that our public utilities and homeowners are able to more easily increase their use of solar energy.”
The Illinois renewable portfolio standard, which was originally established in 2007, currently requires the state’s alternative retail electric suppliers as well as investor-owned electric utilities to supply 25% of its power from renewable resources by 2025. 75% of the renewable portfolio standard must be satisfied through wind sources and 6% of the renewable portfolio standard must be satisfied through solar sources.
The state’s renewable portfolio standard may be satisfied through the purchase of renewable energy certificates (“RECs”). Prior to June 1, 2011, the RECs must be purchased from in-state generators, provided that they are cost-effective. If RECs are unavailable or are not cost-effective from in-state generators, then they may be purchased from states that adjoin Illinois. If RECs are not available from adjoining states, then they may be purchased elsewhere. After June 1, 2011, however, the RECs may be purchased from either renewable energy resources located in Illinois or in the states that adjoin Illinois. If the utilities are not able to purchase the certificates from in-state generators or adjoining-state generators, then the certificates may be purchased elsewhere.
For more information or questions regarding HB 6202 or any related topic, please contact Candice Columbres located in our Chicago office at 312-759-5946 or Candice.Columbres@troutmansanders.com or Craig Kline located in our New York office at 212-704-6150 or Craig.Kline@troutmansanders.com.
The full text of House Bill 6202 can be found here.