EXPLANATION: CAPITALS INDICATE MAT TER ADDED TO EXISTIN G LAW.
[Brackets] indicate matter deleted from existing law.
*sb0902*
SENATE BILL 902
C5, M3 2lr2882
By: Senator Hershey
Introduced and read first time: February 7, 2022
Assigned to: Finance
A BILL ENTITLED
AN ACT concerning 1
Dams With Hydroelectric Power Plants – Annual Compensation Fee 2
FOR the purpose of requiring the owner of a dam associated with a certain hydroelectric 3
power plant to pay an annual compensation fee to the Department of the 4
Environment for the use of State land and waterways beginning on a certain date; 5
requiring the Public Service Commission to determine the average price of a Tier 2 6
renewable energy credit for certain renewable energy portfolio standard compliance 7
years; prohibiting the owner of the dam from applying to or petitioning the 8
Commission to increase the hydroelectric power plant’s rates as a means of offsetting 9
the cost of the compensation fee; requiring the Department to transfer revenue 10
generated from the compensation fee to the Chesapeake Bay Trust for certain 11
purposes; and generally relating to an annual compensation fee for dams associated 12
with hydroelectric power plants. 13
BY adding to 14
Article – Public Utilities 15
Section 7–217 16
Annotated Code of Maryland 17
(2020 Replacement Volume and 2021 Supplement) 18
SECTION 1. BE IT ENACTED BY THE GENERAL ASSEMBLY OF MARYLAND, 19
That the Laws of Maryland read as follows: 20
Article – Public Utilities 21
7–217. 22
(A) (1) IN THIS SECTION THE F OLLOWING WORDS HAVE THE MEANINGS 23
INDICATED. 24
2 SENATE BILL 902
(2) “RENEWABLE ENERGY CRED IT” HAS THE MEANING STAT ED IN § 1
7–701 OF THIS TITLE. 2
(3) “RENEWABLE ENERGY PORTFOLIO STANDARD ” HAS THE 3
MEANING STATED IN § 7–701 OF THIS TITLE. 4
(4) “TIER 2” MEANS A TIER 2 RENEWABLE SOURCE AS DEFINED IN § 5
7–701 OF THIS TITLE. 6
(B) BEGINNING JANUARY 1, 2023, THE OWNER OF A DAM ASSOC IATED WITH 7
A HYDROELECTRIC POWE R PLANT THAT HAS A GENERATIN G CAPACITY OF AT LEA ST 8
30 MEGAWATTS AND IS CONNECTED WIT H THE ELECTRIC DISTRIBUTION GRID 9
SERVING MARYLAND SHALL PAY AN ANNUAL COMPENSATION FEE TO THE 10
DEPARTMENT OF THE ENVIRONMENT FOR THE USE OF STATE LAND AND 11
WATERWAYS . 12
(C) (1) EXCEPT AS PROVIDED IN PARAGRAPH (3) OF THIS SUBSECTION , 13
THE COMPENSATION FEE SHA LL BE: 14
(I) CALCULATED ON AN ANNU AL BASIS; AND 15
(II) COMPUTED BY MULTIPLYI NG: 16
1. THE MEGAWATT –HOURS OF ELECTRICITY 17
GENERATED BY THE HYD ROELECTRIC POWER PLA NT DURING THE PREVIOUS YEAR ; 18
2. THE AVERAGE PRICE OF A TIER 2 RENEWABLE 19
ENERGY CREDIT FOR THE PREVIOUS RENEWABLE ENERGY POR TFOLIO STANDARD 20
COMPLIANCE YEAR, AS DETERMINED BY THE COMMISSION; AND 21
3. 80%. 22
(2) ON OR BEFORE JANUARY 31, 2023, AND ON OR BEFORE EACH 23
JANUARY 31 THEREAFTER , THE COMMISSION SHALL DETE RMINE THE AVERAGE 24
PRICE OF A TIER 2 RENEWABLE ENERGY CRE DIT FOR THE PREVIOUS RENEWABLE 25
ENERGY PORTFOLIO STANDARD COMPLIANCE YEAR. 26
(3) (I) THE COMPENSATION FEE PAID IN 2023 SHALL INCLUDE A 27
FEE FOR THE USE OF STATE LAND AND WATERW AYS DURING THE 2020 AND 2021 28
CALENDAR YEARS . 29
(II) THE COMPENSATION FEE UNDER SUBPARAGRAPH (I) OF 30
THIS PARAGRAPH SHALL BE COMPUTED BY MULTIPLY ING: 31 SENATE BILL 902 3
1. THE MEGAWATT –HOURS OF ELECTRICITY 1
GENERATED BY THE HYD ROELECTRIC POWER PLA NT DURING 2020 AND 2021, 2
RESPECTIVELY ; 3
2. THE AVERAGE PRICE OF A TIER 2 RENEWABLE 4
ENERGY CREDIT FOR TH E 2020 AND 2021 RENEWABLE ENERGY POR TFOLIO 5
STANDARD COMPLIANCE YEARS, RESPECTIVELY , AS DETERMINED BY THE 6
COMMISSION; AND 7
3. 80%. 8
(III) ON OR BEFORE JANUARY 31, 2023, THE COMMISSION 9
SHALL DETERMINE THE AVERAGE PRICE OF A TIER 2 RENEWABLE ENERGY CRE DIT 10
FOR THE 2020 AND 2021 RENEWABLE ENERGY POR TFOLIO STANDARD COMPLIANCE 11
YEARS. 12
(D) THE OWNER OF A DAM AS SOCIATED WITH A HYDR OELECTRIC POWER 13
PLANT MAY NOT APPLY TO OR PETITION THE COMMISSION TO INCREAS E THE 14
HYDROELECTRIC POWER PLANT’S ELECTRICITY RATES AS A MEANS OF OFFSET TING 15
THE COST OF THE COMP ENSATION FEE IMPOSED UNDER THIS SECTION . 16
(E) THE DEPARTMENT OF THE ENVIRONMENT SHALL TRANSFER REVEN UE 17
GENERATED FROM THE C OMPENSATION FEE UNDE R THIS SECTION TO TH E 18
CHESAPEAKE BAY TRUST TO BE USED AS FOLLOWS: 19
(1) 25% OF THE REVENUE FOR THE ADMINISTRATI ON OF GRANTS FOR 20
AQUATIC SPECIES REST ORATION; AND 21
(2) 75% OF THE REVENUE AS GRANTS TO COUNTY OYSTER 22
COMMITTEES FOR PURCH ASING OR OBTAINING N ATIVE CHESAPEAKE BAY OYSTER 23
SHELLS. 24
(F) THE COMMISSION AND THE DEPARTMENT OF THE ENVIRONMENT 25
JOINTLY SHALL ADOPT REGULATI ONS TO CARRY OUT THI S SECTION. 26
SECTION 2. AND BE IT FURTHER ENACTED, That this Act shall take effect 27
October 1, 2022. 28