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Oregon Bulletin

January 1, 2012

 

Department of Energy
Chapter 330

Rule Caption: Procedures for consumer-owned utility power purchases to comply with the greenhouse gas emissions standard.

Adm. Order No.: DOE 9-2011

Filed with Sec. of State: 11-22-2011

Certified to be Effective: 11-22-11

Notice Publication Date: 8-1-2011

Rules Adopted: 330-180-0010, 330-180-0020, 330-180-0030, 330-180-0040, 330-180-0050, 330-180-0060, 330-180-0070

Subject: The purpose of the ODOE rules is to provide procedures for consumer-owned utilities to implement Oregon’s greenhouse gas emissions standard of ORS 757.528 AND 757.533 for power purchases. The proposed rules provide guidance for:

      An output-based methodology for calculating greenhouse gases;

      how electricity with no identified generation source will be addressed; and

      A process for determining how facilities would be designated as a “low-carbon resource” in the future and be eligible for meeting the greenhouse gas standards.

Rules Coordinator: Kathy Stuttaford—(503) 373-2127

330-180-0010

Purpose and Scope

These rules provide procedures to assist the governing boards of consumer-owned utilities to comply with the greenhouse gas emissions performance standard for electricity established in ORS 757.522 to 757.536.

Stat. Auth.: ORS 757.522 - 757.538, 469.040

Stats. Implemented: ORS 757.522 - 757.538

Hist.: DOE 9-2011, f. & cert. ef. 11-22-11

330-180-0020

Definitions

(1) “Cogeneration facility” means a facility where the sequential generation of electric energy and the production of steam or other forms of useful energy (such as heat) from the same primary energy source or fuel are used for industrial, commercial, heating, or cooling purposes.

(2) “Department” means the Oregon Department of Energy pursuant to ORS 469.020(5).

(3) “Director” means the director of the department pursuant to ORS 469.020(6).

(4) “Low-Carbon Emissions Resource” means a generating facility that is capable of meeting the greenhouse gas emissions standard through the use of technologies, fuels, or feedstocks that work together to result in an emissions rate at or below the emissions standard, or by sequestering a sufficient portion of greenhouse gas emissions such the net greenhouse gas emissions at the generating facility are maintained at or below the standard.

(5) “Useful thermal energy” is the net thermal energy made available by a cogeneration facility for processes or applications other than for the generation of electricity, taking into account any portion of the total thermal energy produced that is used as part of the cogeneration process or that is discharged as waste.

Stat. Auth.: ORS 757.522 - 757.538, 469.040

Stats. Implemented: ORS 757.522 - 757.538

Hist.: DOE 9-2011, f. & cert. ef. 11-22-11

330-180-0030

Greenhouse Gas Emissions Standard

(1) The greenhouse gas emissions standard is 1,100 pounds (0.5 metric tons) of greenhouse gases per megawatt-hour (MWh) of electricity for a generating facility as specified by ORS 757.528(1).

(2) The greenhouse gas emissions standard includes only carbon dioxide (CO2) emissions.

(3) A governing board of a consumer-owned utility entering into a long-term financial commitment as defined at ORS 757.522(10)(a) demonstrates compliance with these rules by making a written determination that baseload electricity acquired under the long-term financial commitment entered into by the utility’s governing board is produced by a generating facility that complies with the greenhouse gas emissions standard established in this rule.

Stat. Auth.: ORS 757.522 - 757.538, 469.040

Stats. Implemented: ORS 757.522 - 757.538

Hist.: DOE 9-2011, f. & cert. ef. 11-22-11

330-180-0040

Low-Carbon Emissions Resource Plan

(1) The governing board of a consumer-owned utility, or entity acting on behalf of one or more governing boards, may submit a plan for a generating facility to become a low-carbon emissions resource to the department. The department will make a determination as to whether the plan includes sufficient technical documentation to demonstrate that the generating facility is capable of becoming a low-carbon emissions resource within seven years of commencing operations at the generating facility. The plan must contain sufficient technical documentation to demonstrate:

(a) The net greenhouse gas emissions from the generating facility taking into account any greenhouse gas emissions that are captured, sequestered, or otherwise prevented from being released into the atmosphere – will be at or below the greenhouse gas emissions standard established in this rule;

(b) Additional capacity or capability exists to lower net greenhouse gas emissions over time to meet potential reductions in the greenhouse gas emissions standard;

(c) To the extent that maintenance of the low-carbon emissions resource requires one or more feedstocks, that sufficient supply of the feedstock(s) will be available for use by the generating facility;

(d) How other conditions identified by the governing board(s) to meet and maintain the low-carbon emissions resource status over time can and will be met by the generating facility.

(2) The department determination that the plan includes sufficient technical documentation to demonstrate that the generating facility is capable of becoming a low-carbon emissions resource within seven years of commencing operations must be obtained prior to entering into a long-term commitment with that generating facility.

(3) The department will begin a review within 90 days of receipt of a plan and provide a determination to the governing board(s) as to whether the plan includes sufficient technical documentation to demonstrate that the generating facility is capable of becoming a low-carbon emissions resource within seven years of commencing operations. A plan may be re-submitted to the department for reconsideration if additional technical documentation is available.

(4) If the Oregon Public Utility Commission makes a determination pursuant to ORS 757.531(2)(c) that a plan for a generating facility to become a low-carbon emissions resource is sufficient then the governing board of a consumer-owned utility may consider that determination to provide a sufficient demonstration for purposes of ORS 757.533(2)(c) to consider the same generating facility, utilizing the same plan and under the same time frame, as a low-carbon emissions resource in lieu of a review of that plan by the department.

(5) The department may waive the need or alter the timeline to submit a plan to become a low-carbon emissions resource for good cause shown.

Stat. Auth.: ORS 757.522 - 757.538, 469.040

Stats. Implemented: ORS 757.522 - 757.538

Hist.: DOE 9-2011, f. & cert. ef. 11-22-11

330-180-0050

Unspecified Emissions

(1) Long-term financial commitments consisting of contracts for electricity where the greenhouse gas emissions cannot readily be determined with any specificity are those in which:

(a)  The contract does not allow for the identification of one or more generating facilities from which the contracted energy is derived; or,

(b)  The contract does not provide sufficient detail about the resource mix from which the contracted energy is derived to determine the greenhouse gas emissions associated with the contracted energy.

(2) Emissions to be attributed to such contracts for purposes of determining compliance with the emissions standard in this rule are to be derived as follows:

(a)  By utilizing data from greenhouse gas emissions reports or otherwise submitted to the Oregon Department of Environmental Quality or the US Environmental Protection Agency characterizing the emissions profile of the baseload electricity if that electricity is anticipated to be representative of the contracted energy in the long-term financial commitment; or,

(b) By utilizing the greenhouse gas emissions reporting protocols and emissions factors required by the Oregon Department of Environmental Quality or the US Environmental Protection Agency to estimate the expected emissions profile of the baseload electricity in the long-term financial commitment; or,

(c)  If unable to use the greenhouse gas reporting data, procedures, or protocols utilized by the Oregon Department of Environmental Quality or the US Environmental Protection Agency to assign emissions to the baseload electricity by multiplying the amount of energy for which emissions cannot be determined with specificity by an emissions factor of 1,100 pounds of greenhouse gases per megawatt hour to determine the greenhouse gas emissions.

Stat. Auth.: ORS 757.522 - 757.538, 469.040

Stats. Implemented: ORS 757.522 - 757.538

Hist.: DOE 9-2011, f. & cert. ef. 11-22-11

330-180-0060

Methodology for Calculating Greenhouse Gas Emissions

(1) A generating facility’s annual average electricity production in megawatt-hours (MWh) is the sum of the electricity available for all of the following:

(a) Use onsite;

(b) Use at a host site in a commercial or industrial process;

(c) Sale; or

(d) Transmission from the generating facility.

(2) The greenhouse gases for cogeneration facilities must include the total usable energy output of the process and includes all greenhouse gases emitted by the facility in the production of both electrical and thermal energy.

(a) A cogeneration facility’s annual average electricity production is the sum of the MWh of electricity produced and the useful thermal energy output expressed in MWh.

(b) The useful thermal energy output must be converted into a MWh equivalent using the standard engineering conversion factor of 3.413 MMBtu per MWh (or 3,413 Btu per kWh).

 (3) In determining whether a generating facility complies with the emissions standard, the total emissions associated with producing energy at the generating facility must be included in determining the rate of emissions of greenhouse gases. The total emissions associated with producing electricity at the generating facility do not include emissions associated with transportation, fuel extraction or other life-cycle emissions associated with obtaining the fuel for the facility.

Stat. Auth.: ORS 757.522 - 757.538, 469.040

Stats. Implemented: ORS 757.522 - 757.538

Hist.: DOE 9-2011, f. & cert. ef. 11-22-11

330-180-0070

Exemptions

The requirement for a governing body to report exemptions to the department as required by ORS 757.528(7) must be in writing and may be submitted electronically or by regular mail.

Stat. Auth.: ORS 757.522 - 757.538, 469.040

Stats. Implemented: ORS 757.522 - 757.538

Hist.: DOE 9-2011, f. & cert. ef. 11-22-11

 

Rule Caption: Amendments to Business Energy Tax Credit rules to implement Oregon Laws 2011, Chapter 730 (HB 3672).

Adm. Order No.: DOE 10-2011

Filed with Sec. of State: 11-30-2011

Certified to be Effective: 11-30-11

Notice Publication Date: 10-1-2011

Rules Adopted: 330-090-0160

Rules Amended: 330-090-0133

Subject: These permanent rule amendments implement changes made by Oregon Laws 2011, Chapter 730 (house Bill 3672) to the Business Energy Tax Credit program. These amendments implement statutory changes to the sunset of the program, and provide a process for participants to demonstrate “beginning construction before April 15, 2011” for the purpose of extending the time allowed to receive final certification of their facility.

Rules Coordinator: Kathy Stuttaford—(503) 373-2127

330-090-0133

How ODOE Processes a Final Application

(1) Processing the Final Certification: To qualify for a Final Certification, the facility must be completed as described in the Application for Preliminary Certification and the Preliminary Certificate. Any changes to the Preliminary Certificate and/or Application for Preliminary Certification must complete the amendment process outlined in these rules prior to the project completion date. Failure to obtain approval through the amendment process may result in denial of the Final Certification Application.

(a) Applications shall be considered received for the purposes of ORS 469.220 on the date marked received by the department, unless the application is incomplete. If the application for final certification is not complete, the date marked received by the department on the complete application containing all of the required information shall be considered the received date.

(A) When a facility owner chooses to transfer the tax credit under ORS 469.206, the Department may hold the application for final certification until pass-through partner(s) information is received by the Department. Except for a facility using or producing renewable energy resources with a certified cost that exceeds $10 million, any application in which the facility owner has indicated a choice to transfer the tax credit under ORS 469.206 is not a “completed application” until the Department receives both the completed final certification application form from the facility owner and the completed pass-through partner agreement form for the tax credit, or portion of the tax credit, being transferred to that pass-through partner. The receipt of the completed application by the Department begins the certification period, as provided in ORS 469.220.

(B) As provided in Oregon Laws, 2011, Chapter 693, Section(2)(c), a facility using or producing renewable energy resources with a certified cost that exceeds $10 million and that receives final certification under ORS 469.215 after January 1, 2010, a final certification application shall be considered complete without the identification of a transferee for purposes of ORS 469.206 or 469.208.

(C) If more than one pass-through partner is being transferred the credit, facility owners may have up to 18 months from the date the first pass-through partner agreement form is received by the Department to begin each certification period of the tax credit. For pass-through partner(s) agreement forms received by the Department after the 18-month period, the certification period begins 18 months from the date the first pass-through partner agreement form was received by the Department.

(D) For purposes of administering the sunset of the program, the Department may issue a Final Certificate to a facility owner who previously indicated a choice to transfer a tax credit to a pass-through partner under ORS 469.206, if the Department has not received a completed application that includes the signed pass-through partner agreement form at least sixty days prior to the sunset date for the BETC program provided under ORS 315.357. The Final Certificate will be issued to a facility owner if the only piece causing the application for final certification to be incomplete is the pass-through partner(s) agreement form.

(b)    Within 30 days after a final certification application is received, the Director will determine whether the application is complete. An application is incomplete if it does not include information needed to demonstrate substantive compliance with the provisions of ORS 469.185 to 469.225 and any applicable rules or standards and preliminary certification conditions adopted by the Director. If it is not complete, the applicant will be provided a written explanation describing deficiencies. If it is complete, the Director will process the application. Within 60 days after a completed final certification application is received the director will either approve or deny the final certification.

(c) If the Director approves the application, the Director will issue final certification, which will state the amount of certified costs and the amount of the tax credit approved. The final certification may contain additional criteria and conditions that must be met in order to retain tax credit benefits or the tax credit certificate may be subject to revocation. If the facility fails to meet any of the criteria, conditions and requirements established in the final certification, the facility owner must notify the Department within 30 days.

(d) For efficient truck technology facilities the department may, upon the request of the applicant, issue no more than two final certificates for each preliminary certification, up to the amount of the preliminary certification.

(2) Basis for Denying Tax Credit Benefits

(a) If the Director does not approve the application, the Director will provide written notice of the action, including a statement of the findings and reasons for the denial by regular and certified mail.

(b) A final certification application that is denied can be submitted again. A final certification application can be amended or withdrawn by the applicant. If an application is submitted again or amended, the time within which final certification review occurs starts over.

(c) If the Director does not issue a final certification within 60 days after an application is filed, the application is denied pursuant to ORS 469.215(4).

(d) The Director may deny a final certificate if:

(A) The applicant does not provide information about the facility in a reasonable time after the Director requests it;

(B) The facility is significantly different than the proposed facility for which the preliminary certification was issued;

(C) The applicant misrepresents or fails to construct or operate the facility;

(D) The applicant fails to demonstrate that the facility described in the application is separate and distinct from previous or current applications reviewed by the Department;

(E) The facility does not meet all of the conditions and requirements contained in the preliminary certificate; or

(F) The applicant is unable to demonstrate that the facility complies with all applicable provisions of ORS Chapter 469 and the rules adopted thereunder.

(3) Basis for Revoking Tax Credit Benefits

(a) The Director may revoke certificates as provided in ORS 469.225 and ORS 315.354 (5). For the purposes of this section, “fraud or misrepresentation” means any misrepresentation made by an applicant for a preliminary or final certification, including but not limited to, misrepresentations as to the applicant’s financial viability, facility construction and operation, or any other information provided as part of an application for a preliminary or final certification.

(b) After the Director issues a final certificate, an applicant must notify the director in writing of any of the following conditions:

(A) The facility has been moved;

(B) Title to the facility has been conveyed;

(C) The facility is subject to or part of a bankruptcy proceeding;

(D) The facility is not operating; or

(E) The term of a leased facility has ended.

(c) Pursuant to ORS 469.225, upon receiving information that a BETC certification was obtained by fraud or misrepresentation, or that the facility has not been constructed or operated in compliance with the requirements in the certificate, the Director shall revoke the certificate for the facility.

(d) A revocation of the final certification or portion of a certification due to fraud or misrepresentation results in the loss of all prior and future tax credits in connection with that facility. If all or a part of the tax credit certificate has been transferred to a Pass-through partner under ORS 469.206, the certificate is not considered revoked as to the Pass-through partner, but the facility owner is liable for the amount of tax credits claimed or that could be claimed.

(e) The revocation of a certificate due to failure to construct or operate the facility in compliance with the certificate results in the loss of any tax credits not yet claimed by the facility owner. If all or a part of the tax credit certificate has been transferred to a Pass-through partner under ORS 469.206, the certificate is not considered revoked as to the Pass-through partner, but the facility owner is liable for the amount of tax credits claimed or that could be claimed.

(4) Sale or Disposition of the Facility after Final Certification:

(a) Pursuant to ORS 315.354(5), upon receiving notice that the facility has been sold or otherwise transferred, the Director will revoke the final certificate, as of the date of the disposition of the facility, unless the BETC for the facility has already been transferred under ORS 468.206.

(b) The new owner or new or renewed lessee of a facility may apply for a final certificate. The request must comply with OAR 330-090-0130(10) and include information to allow the Director to determine the amount of tax credit not claimed by the former owner or former lessee. If the facility continues to comply with the requirements set out in these rules and any applicable conditions imposed by the Director, the Director will issue a new final certification consistent with the provisions of ORS 315.354(5).

(5) Request for Reconsideration: No later than 60 days after the Director issues an order on a preliminary certification, amendment to a preliminary certification, final certification, or canceling or revoking a final certificate under these rules, the applicant or certificate holder may request reconsideration in writing.

(6) Inspections: After an application is filed under ORS 469.205 or ORS 469.215 or a tax credit is claimed under these rules, the Department may inspect the facility. The Department will schedule the inspection during normal working hours, following reasonable notice to the facility operator.

Stat. Auth.: ORS 469.040 & 469.165

Stats. Implemented: ORS 469.185 - 469.225

Hist.: DOE 2-2009(Temp), f. & cert. ef. 11-3-09 thru 5-1-10; DOE 3-2010, f. & cert. ef. 4-30-10; DOE 4-2010(Temp), f. 5-21-10, cert. ef. 5-27-10 thru 11-2-10; Administrative correction 11-23-10; DOE 14-2010, f. & cert. ef. 11-23-10; DOE 3-2011(Temp), f. 4-15-11, cert. ef. 4-18-11 thru 10-14-11; DOE 6-2011, f. & cert. ef. 9-29-11; DOE 7-2011, f. & cert. ef. 10-25-11; DOE 10-2011, f. & cert. ef. 11-30-11

330-090-0160

Sunset of the Business Energy Tax Credit Program

(1) Oregon Laws 2011, chapter 730, amends the sunset of the Business Energy Tax Credit Program and implements dates by which final certification must be issued for an applicant to be allowed a credit under ORS 315.354. Applicants must meet the deadlines that apply to their project:

(a) Applicants with a preliminary certification for a facility that uses or produces renewable energy resources that are unable to demonstrate evidence of beginning construction before April 15, 2011 must file a complete application for final certification before the expiration of the preliminary certification and receive final certification before January 1, 2013. The Director does not guarantee that a complete final certification application received on or after November 1, 2012 will be processed prior to January 1, 2013. Applicants that have not already extended their preliminary certification may file for an extension under OAR 330-090-0130.

(b) Applicants with a preliminary certification for a facility that uses or produces renewable energy resources that are able to demonstrate evidence of beginning construction before April 15, 2011 must file a complete application for final certification before the expiration of the preliminary certification. Applicants that have not already extended their preliminary certification may file for an extension under OAR 330-090-0130.

(c) Applicants with a preliminary certification for a facility other than a facility that uses or produces renewable energy resources that are unable to demonstrate evidence of beginning construction before April 15, 2011 must receive final certification before January 1, 2013. The Director does not guarantee that a complete final certification application received on or after November 1, 2012 will be processed before January 1, 2013.

(d) Applicants with a preliminary certification for a facility other than a facility that uses or produces renewable energy resources that are able to demonstrate evidence of beginning construction before April 15, 2011 must file a complete application for final certification on or before July 1, 2014.

(2) Applicants with a preliminary certification may apply to the department to demonstrate that construction of the facility began before April 15, 2011.

(a) An application must include at least these items:

(A) A brief update on the progress of the facility.

(B) A construction schedule showing the anticipated completion date.

(C) A statement that the facility will be completed as approved in the preliminary certification.

(D) Evidence of beginning construction, including but not limited to:

(i) A copy of an approved building, grading or other permit issued for the facility, dated prior to April 15, 2011.

(ii) Evidence of site-specific construction activity, for the period on or after the later of preliminary certification or building permit approval and before April 15, 2011.

(iii) Evidence of facility-specific construction activity, for the period on or after preliminary certification and before April 15, 2011.

(b) Evidence of site-specific construction activity may include, but is not limited to:

(A) Paid invoices for completed construction activity.

(B) Timesheets for construction activities linked to the facility site.

(C) Paid rental documentation for construction equipment.

(D) A written report from the project engineer or installer signed under penalties of perjury describing the work that had commenced before April 15, 2011.

(c) Evidence of facility-specific construction activity may include, but is not limited to:

(A) Paid invoices for facility-specific assembly or manufacturing activity.

(B) Timesheets for assembly or manufacturing activities linked to the facility.

(C) A written report from the project engineer or manufacturer signed under penalties of perjury describing the work that had commenced before April 15, 2011.

 (d) Applications must be received by the department before July 1, 2012.

(e) The Department will review the provided information and respond to the application within 60 days. As part of its determination, the department may request additional information from the applicant and may perform inspections.

(A) The department will issue a written acceptance letter to applicants who are able to demonstrate evidence of beginning construction. The acceptance letter will state the date by which the applicant must receive final certification to be allowed a credit under ORS 315.354.

(B) The department will issue a letter to applicants who have not provided sufficient evidence of beginning of construction providing reasons for the denial.

Stat. Auth.: ORS 469.040 & 469.165, 469.185-469.225, OL 2011, Ch. 730(HB 3672

Stats. Implemented: OL 2011, Ch. 730(HB 3672

Hist.: DOE 10-2011, f. & cert. ef. 11-30-11

Notes
1.) This online version of the OREGON BULLETIN is provided for convenience of reference and enhanced access. The official, record copy of this publication is contained in the original Administrative Orders and Rulemaking Notices filed with the Secretary of State, Archives Division. Discrepancies, if any, are satisfied in favor of the original versions. Use the OAR Revision Cumulative Index found in the Oregon Bulletin to access a numerical list of rulemaking actions after November 15, 2011.

2.) Copyright 2012 Oregon Secretary of State: Terms and Conditions of Use

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