House Bill No. 6524
Public Act No. 21-162
AN ACT CONCERNING THE SOLICITATION OF NEW FUEL CELL
ELECTRICITY GENERATION PROJECTS.
Be it enacted by the Senate and House of Representatives in General
Assembly convened:
Section 1. Section 16-244y of the general statutes is repealed and the
following is substituted in lieu thereof (Effective July 1, 2021):
[An electric distribution company may submit to the Public Utilities
Regulatory Authority for approval one or more plans to acquire new
fuel cell electricity generation that began operation on or after July 1,
2017. Any such plan shall utilize a competitive process for the purpose
of providing distribution system benefits, including, but not limited to,
avoiding or deferring distribution capacity upgrades, and enhancing
distribution system reliability, including, but not limited to, voltage or
frequency improvements. Any such plan shall give preference to
proposals that make efficient use of existing sites and supply
infrastructure. In the event that the authority approves such plan, an
electric distribution company may submit to the authority (1) one or
more proposals to build, own and operate new fuel cell generation, (2)
proposed power purchase agreements negotiated with persons to build,
own and operate new fuel cell generation, or (3) proposals to provide
financial incentives for the installation of combined heat and power
systems powered by fuel cells, provided any such incentives shall be House Bill No. 6524
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consistent with the Comprehensive Energy Strategy pursuant to section
16a-3d. The facilities acquired, built pursuant to said power purchase
agreements and that receive said financial incentives under this section
shall not exceed a total nameplate capacity rating of thirty megawatts in
the aggregate. Any proposal submitted by an electric distribution
company to build, own and operate a fuel cell shall include the electric
distribution company's full projected costs and shall demonstrate to the
authority that such facility is not supported in any form of cross
subsidization by affiliated entities. The authority shall evaluate any
proposal submitted pursuant to this section in a manner that is
consistent with the principles of sections 16-19 and 16-19e and may
approve one or more proposals if it finds that such proposal (A) was
developed in a manner that is consistent with the acquisition plan
approved by the authority, (B) serves the long-term interests of
ratepayers, and (C) cost-effectively avoids or defers distribution system
costs.]
(a) Each electric distribution company shall solicit proposals to
acquire new fuel cell electricity generation projects that began operation
on or after July 1, 2021. All such projects shall be selected utilizing a
competitive process that gives preference to fuel cell electricity
generation projects that utilize equipment manufactured in the state or
sited on brownfields, as defined in section 32-760, or landfills. On or
before January 1, 2022, each electric distribution company shall submit
the selected projects and associated tariffs to the Public Utilities
Regulatory Authority for approval.
(b) On or before August 1, 2021, all electric distribution companies
shall jointly file with the authority for approval a proposed tariff for use
in the solicitation authorized in subsection (a) of this section. The
facilities acquired under this section shall not exceed a total nameplate
capacity rating of thirty megawatts in the aggregate apportioned among
each electric distribution company in proportion to distribution load. House Bill No. 6524
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Any proposed projects submitted by an electric distribution company
shall include the electric distribution company's full projected costs and
shall demonstrate to the authority that such facility is not supported in
any form of cross subsidization by affiliated entities, except that the
costs associated with those benefits which the authority determines that
a proposed fuel cell project confers on the natural gas system may be
recovered from all gas customers through the purchased gas adjustment
clause established pursuant to section 16-19b and such costs shall be
apportioned relative to the revenues of each gas company as reported
to the authority pursuant to section 16-49 for the most recent fiscal year.
(c) The authority may approve any such projects for the purpose of
(1) providing commercial or industrial electric or gas customers with on-
site generation that increases power quality or resilience, as defined in
section 16-243y, or reduces energy costs for such customers, (2)
providing emergency service facilities or commercial or industrial
electric or gas customers with back-up power, or (3) enhancing
distribution system reliability, including, but not limited to, electric
voltage or frequency improvements, support of microgrids or other
measures that support electric or gas system resiliency. The authority
shall evaluate any projects submitted pursuant to this section in a
manner that is consistent with the provisions of sections 16-19 and 16-
19e.
(d) The costs prudently incurred by an electric distribution company
under this section shall be recovered from all customers of the electric
distribution company through a fully reconciling component of electric
rates for all customers of the electric distribution company, until the
electric distribution company's next rate case, at which time any costs
and investments for new fuel cell generation owned by the electric
distribution company pursuant to [subdivision (1) of] this section [shall]
may be recoverable through base distribution rates, as determined by
the authority. Nothing in this section shall preclude the resale or other House Bill No. 6524
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disposition of any energy products, capacity and associated
environmental attributes purchased by the electric distribution
company, [provided the electric distribution company shall net the cost
of payments made to projects under any long-term contracts entered
into pursuant to subdivision (2) of this section against the proceeds of
the sale of any energy products, capacity and environmental attributes
and the difference thereof plus any net costs incurred pursuant to
subdivision (3) of this section shall be credited or charged to distribution
customers through a reconciling component of electric rates, as
determined by the authority, that is nonbypassable when switching
electric suppliers] if so ordered by the authority. The electric
distribution company may use any energy products, capacity and
environmental attributes produced by such facility to meet the needs of
customers served pursuant to section 16-244c, and as determined by the
authority. Notwithstanding the provisions of subdivision (1) of
subsection (h) of section 16-244c, certificates issued by the New England
Power Pool Generation Information System for any Class I renewable
energy source acquired pursuant to this section may be retained by the
electric distribution company to meet the requirements of section 16-
245a, and as determined by the authority.