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.
   74  Be It Enacted by the Legislature of the State of Florida:
   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, 2016 2010, up to a limit of
  123  $25 $3 million 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, 2016 2010, up to a limit of
  131  $25 $1.5 million 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, 2016 2010, up to a limit of
  140  $6 $6.5 million 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, 2016 2010, 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  2018 2012, 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 2017 2011, 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, 2017 2010. The combined total
  239  amount of tax credits which may be granted for all taxpayers
  240  under this section is limited to $250 $5 million 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.; but The term “public utility”
  250  does not include: either
  251         (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 special natural gas
  255  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; or
  262         (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 as means a 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 operations and electrical energy produced using
  332  pipeline-quality synthetic gas produced from waste petroleum
  333  coke 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 that
  357  represents the unbundled, separable, renewable attribute of
  358  renewable energy produced in Florida and is equivalent to 1
  359  megawatt-hour of electricity generated by a source of renewable
  360  energy located in Florida.
  361         (e) “Renewable portfolio standard” or “RPS” means the
  362  minimum percentage of total annual retail electricity sales by a
  363  provider to consumers in Florida that shall be supplied by
  364  renewable 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 renewable
  534  portfolio standard requiring each provider to supply renewable
  535  energy to its customers directly, by procuring, or through
  536  renewable energy credits. In developing the RPS rule, the
  537  commission shall consult the Department of Environmental
  538  Protection and the Florida Energy and Climate Commission. The
  539  rule shall not be implemented until ratified by the Legislature.
  540  The commission shall present a draft rule for legislative
  541  consideration by February 1, 2009.
  542         (a) In developing the rule, the commission shall evaluate
  543  the current and forecasted levelized cost in cents per kilowatt
  544  hour through 2020 and current and forecasted installed capacity
  545  in kilowatts for each renewable energy generation method through
  546  2020.
  547         (b) The commission’s rule:
  548         1. Shall include methods of managing the cost of compliance
  549  with the renewable portfolio standard, whether through direct
  550  supply or procurement of renewable power or through the purchase
  551  of renewable energy credits. The commission shall have
  552  rulemaking authority for providing annual cost recovery and
  553  incentive-based adjustments to authorized rates of return on
  554  common equity to providers to incentivize renewable energy.
  555  Notwithstanding s. 366.91(3) and (4), upon the ratification of
  556  the rules developed pursuant to this subsection, the commission
  557  may approve projects and power sales agreements with renewable
  558  power producers and the sale of renewable energy credits needed
  559  to comply with the renewable portfolio standard. In the event of
  560  any conflict, this subparagraph shall supersede s. 366.91(3) and
  561  (4). However, nothing in this section shall alter the obligation
  562  of each public utility to continuously offer a purchase contract
  563  to producers of renewable energy.
  564         2. Shall provide for appropriate compliance measures and
  565  the conditions under which noncompliance shall be excused due to
  566  a determination by the commission that the supply of renewable
  567  energy or renewable energy credits was not adequate to satisfy
  568  the demand for such energy or that the cost of securing
  569  renewable energy or renewable energy credits was cost
  570  prohibitive.
  571         3. May provide added weight to energy provided by wind and
  572  solar photovoltaic over other forms of renewable energy, whether
  573  directly supplied or procured or indirectly obtained through the
  574  purchase of renewable energy credits.
  575         4. Shall determine an appropriate period of time for which
  576  renewable energy credits may be used for purposes of compliance
  577  with the renewable portfolio standard.
  578         5. Shall provide for monitoring of compliance with and
  579  enforcement of the requirements of this section.
  580         6. Shall ensure that energy credited toward compliance with
  581  the requirements of this section is not credited toward any
  582  other purpose.
  583         7. Shall include procedures to track and account for
  584  renewable energy credits, including ownership of renewable
  585  energy credits that are derived from a customer-owned renewable
  586  energy facility as a result of any action by a customer of an
  587  electric power supplier that is independent of a program
  588  sponsored by the electric power supplier.
  589         8. Shall provide for the conditions and options for the
  590  repeal or alteration of the rule in the event that new
  591  provisions of federal law supplant or conflict with the rule.
  592         (c) Beginning on April 1 of the year following final
  593  adoption of the commission’s renewable portfolio standard rule,
  594  each provider shall submit a report to the commission describing
  595  the steps that have been taken in the previous year and the
  596  steps that will be taken in the future to add renewable energy
  597  to the provider’s energy supply portfolio. The report shall
  598  state whether the provider was in compliance with the renewable
  599  portfolio standard during the previous year and how it will
  600  comply with the renewable portfolio standard in the upcoming
  601  year.
  602         (4)In order to demonstrate the feasibility and viability
  603  of clean energy systems, the commission shall provide for full
  604  cost recovery under the environmental cost-recovery clause of
  605  all reasonable and prudent costs incurred by a provider for
  606  renewable energy projects that are zero greenhouse gas emitting
  607  at the point of generation, up to a total of 110 megawatts
  608  statewide, and for which the provider has secured necessary
  609  land, zoning permits, and transmission rights within the state.
  610  Such costs shall be deemed reasonable and prudent for purposes
  611  of cost recovery so long as the provider has used reasonable and
  612  customary industry practices in the design, procurement, and
  613  construction of the project in a cost-effective manner
  614  appropriate to the location of the facility. The provider shall
  615  report to the commission as part of the cost-recovery
  616  proceedings the construction costs, in-service costs, operating
  617  and maintenance costs, hourly energy production of the renewable
  618  energy project, and any other information deemed relevant by the
  619  commission. Any provider constructing a clean energy facility
  620  pursuant to this section shall file for cost recovery no later
  621  than 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 state of Florida to:
  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 impacts impact.
  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. 377.601 s. 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.
  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. 377.601 s. 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 steam or solar electrical generating facility
  857  using any process or fuel, including nuclear materials, except
  858  that this term does not include any steam or solar electrical
  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.