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21LSO-0659
2021
STATE OF WYOMING
21LSO-0659
Numbered
2.0
HOUSE BILL NO. HB0258
Public utilities-reliability and transparency requirements.
Sponsored by: Representative(s) Zwonitzer, Clausen, Greear and Heiner
A BILL
for
AN ACT relating to public utilities; providing legislative findings; amending reliable and dispatchable energy standards to require the public service commission to establish reliability and transparency requirements; amending low-carbon energy standard requirements to require the use of certain generation facilities as specified; authorizing the public service commission to revoke certificates of convenience and necessity as specified; amending and defining terms; amending definitions related to low-carbon energy standards and requirements; making conforming amendments; requiring rulemaking; and providing for effective dates.
Be It Enacted by the Legislature of the State of Wyoming:
Section 1.
(a)
The legislature finds that:
(i)
Wyoming is the largest producer of coal in the United States, supplying approximately forty percent (40%) of the nation's coal, which is used to generate approximately eleven percent (11%) of the nation's electricity that is supplied to millions of consumers in the United States;
(ii)
Approximately two
‑
thirds (2/3) of the electricity produced in Wyoming, most of which is produced by coal
‑
fired electric generation facilities, is exported to other states, ensuring reliability and sufficient resource adequacy of the electric transmission grid;
(iii)
The welfare and economic security of Wyoming and its citizens depend upon the reliability and resiliency of the nation's electric power supply;
(iv)
Electric power markets have likely been distorted by direct and indirect subsidies and will not
function rationally until policies account for the true and total cost of generated electricity;
(v)
Market distortions have resulted in the undervaluation of dispatchable thermal electric power generation facilities that are now at risk of early retirement, which will further erode the reliability and resiliency of the electric grid;
(vi)
The variability and
nondispatchability
of wind and solar electric generation threatens to expose the bulk power system to reliability and resiliency challenges without the continued presence of significant dispatchable thermal electric generation;
(vii)
Economics and scaling issues will prevent energy storage technologies from replacing dispatchable thermal electric generation and providing grid support for the foreseeable future;
(viii)
The current system of regulatory oversight is hindered in its ability to ensure the reliability and resiliency of the electric grid because
markets are distorted by direct and indirect subsidies, which prevent ratepayers from knowing the true and total cost of the electric power they are purchasing. Similarly, subsidies lead to analyses that incorporate premature retirement of thermal electric power generation and do not adequately consider the reliability and resiliency penalties of renewable,
nondispatchable
energy;
(ix)
In the states served by the Western Interconnection, state policies mandating and incentivizing the deployment of significant
nondispatchable
electricity sources, including wind and solar, are imposing reliability and resiliency penalties on the bulk power system that Wyoming citizens and industries rely upon;
(x)
It is essential that the state immediately develops additional regulatory structures to ensure that a system is put into place to address the reliability and resiliency penalties being imposed on the state as a result of the deployment of
nondispatchable
sources of electricity, and that Wyoming citizens and industries are given more transparency about the true and total cost of the deployment of those sources of electricity.
Section 2.
W.S. 37
‑
18
‑
103 is created to read:
37
‑
18
‑
103.
Energy reliability standards; enforcement; reporting requirements.
(a)
In addition to the standards established under W.S. 37
‑
18
‑
102, beginning on July 1, 2021, one hundred percent (100%) of the electricity generated or purchased by a public utility shall be dispatchable. Any public utility not meeting the standard required by this subsection shall:
(i)
Offset the reliability difference of
nondispatchable
sources of electricity through firming; or
(ii)
If the public utility does not offset the reliability difference, be subject to revocation of the public utility's certificate of convenience and necessity issued under W.S. 37
‑
2
‑
205.
(b)
To ensure that the reliability standard specified in subsection (a) of this section is implemented, the commission shall:
(i)
Require public utilities generating or purchasing
nondispatchable
electricity to demonstrate to the commission not later than December 1, 2022, and not later than each December 1 thereafter, that the public utility has secured sufficient firming capacity to meet the reliability standard in subsection (a) of this section. As part of this annual reporting requirement, the commission shall require each public utility to demonstrate or provide:
(A)
The firming costs necessitated by the use of renewable,
nondispatchable
energy;
(B)
The total transmission costs with an allocation of the transmission costs necessitated by the use of renewable,
nondispatchable
energy.
(ii)
Commence revocation proceedings under W.S. 37
‑
2
‑
205 if a public utility fails to meet the requirements of subsection (a) of this section.
Section 3.
W.S. 37
‑
1
‑
101(a)(vi)(N), 37
‑
2
‑
205 by creating a new subsection (k) and 37
‑
18
‑
101(a)(i) through (iii) and by creating new paragraphs (v) through (x) are amended to read:
37
‑
1
‑
101.
Definitions.
(a)
As used in chapters 1, 2, 3, 12, 17 and 18 of this title:
(vi)
"Public utility" means and includes every person that owns, operates, leases, controls or has power to operate, lease or control:
(N)
The provisions of W.S. 37
‑
18
‑
101
and 37
‑
18
‑
102
through 37
‑
18
‑
103
shall not apply to any public utility owned or operated by a municipality or any cooperative electrical generation and transmission association operating in interstate commerce whose rates are not regulated by the Wyoming public service commission.
37
‑
2
‑
205.
Certificate of convenience and necessity; hearings.
(k)
The commission shall commence proceedings to revoke a certificate of convenience and necessity issued under this section after finding that a public utility has failed to meet the requirements of W.S. 37
‑
18
‑
103. The commission shall afford a public utility subject to this subsection reasonable notice and an opportunity for hearing for the public utility to show cause why the certificate of convenience and necessity should not be revoked.
37
‑
18
‑
101.
Definitions.
(a)
As used in this article:
(i)
"Carbon capture, utilization and storage technology" means technology that has the principal purpose of capturing, reusing, storing,
transporting,
sequestering or using carbon dioxide emissions to prevent carbon dioxide from entering the atmosphere whether constructed integral or adjacent to a coal fired generation facility;
(ii)
"Dispatchable" means a source of electricity that is available for use on demand and that
can be dispatched upon request of a power grid operator or that can have its power output adjusted, according to market needs
and where the availability of the source is not directly dependent on the presence or variability of wind, sunshine or other weather conditions
;
(iii)
"Low
‑
carbon" means electricity that is generated
while using
by a coal
‑
fired electric generation facility that has been retrofitted and is operating with
carbon capture, utilization and storage technology
and
that produces carbon emissions
either
not greater than six hundred fifty (650) pounds of carbon dioxide per megawatt hour of generated electricity averaged over one (1) calendar year
or such other emission rate as approved by the commission
;
(v)
"Availability factor" means the amount of time that an electric generation facility is able to produce electricity in a specified period of time;
(vi)
"Dispatchable energy reliability factor" means the average availability factor of all dispatchable sources of electricity in the state during the five (5)
peak electric demand hours in the most recent calendar year, or an average of the five (5) peak electric demand hours in past calendar years, as determined by the commission;
(vii)
"Firming" means the act of mitigating the reliability difference of a given
nondispatchable
source of electricity to ensure that the hourly availability of the
nondispatchable
source of electricity equals or exceeds the dispatchable energy reliability factor by:
(A)
Continuing to operate or constructing a facility that generates reliable, dispatchable electricity;
(B)
Acquiring reliable, dispatchable electricity through a power purchase agreement;
(C)
Otherwise generating sufficient electricity to meet the standard specified in this paragraph.
(viii)
"
Nondispatchable
" means a source of electricity that is not dispatchable as defined in paragraph (ii) of this subsection;
(ix)
"Reliability difference" means the difference between a
nondispatchable
source of electricity's average availability factor during the five (5) peak electric demand hours in the most recent calendar year, or an average of the five (5) peak electric demand hours in past calendar years, as determined by the commission, and the dispatchable energy reliability factor;
(x)
"Resiliency" means the ability to withstand and reduce the magnitude or duration of disruptive events and includes the capability to anticipate, absorb, adapt to or rapidly recover from a disruptive event.
Section 4.
The public service commission shall promulgate all rules necessary to implement the provisions of this act.
Section 5
.
(a) Except as provided in subsection (b) of this section, t
his act is effective July 1, 2021
.
(b) Sections 4 and 5 of this act are
effective immediately upon completion of all acts necessary for a bill to become law as provided by Article 4, Section 8 of the Wyoming Constitution.
(END)
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HB0258