SENATE BILL NO. 1192

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S1192......................................................by STATE AFFAIRS
RENEWABLE ENERGY PROJECTS - BONDS - Amends and adds to existing law as a
"Trailer Bill" to House Bill No. 106 to authorize the Idaho Energy
Resources Authority to undertake any renewable energy generation project
for the benefit of one or more independent power producer and may issue its
bonds to finance their costs.
                                                                        
03/14    Senate intro - 1st rdg - to printing
03/15    Rpt prt - to St Aff
03/21    Rpt out - rec d/p - to 2nd rdg
03/22    2nd rdg - to 3rd rdg
03/23    3rd rdg - PASSED - 34-0-0, 1 vacancy
      AYES -- Andreason, Brandt, Broadsword, Bunderson, Burkett,
      Burtenshaw, Cameron, Coiner, Compton, Corder, Darrington, Davis,
      Gannon, Geddes, Goedde, Hill, Jorgenson, Kelly, Keough, Langhorst,
      Little, Lodge, Malepeai, Marley, McGee, McKenzie, Pearce, Richardson,
      Schroeder, Stegner, Stennett, Sweet, Werk, Williams
      NAYS -- None
      Absent and excused -- (District 21 seat vacant)
    Floor Sponsor - Hill
    Title apvd - to House
03/24    House intro - 1st rdg - to Env
03/29    Rpt out - rec d/p - to 2nd rdg
03/30    2nd rdg - to 3rd rdg
    Rls susp - PASSED - 66-0-4
      AYES -- Anderson, Andrus, Barraclough, Barrett, Bastian, Bayer, Bell,
      Bilbao, Black, Block, Boe, Bolz, Bradford, Cannon, Chadderdon, Clark,
      Collins, Crow, Deal, Denney, Edmunson, Ellsworth, Eskridge,
      Field(18), Field(23), Garrett, Hart, Harwood, Henbest, Henderson,
      Jaquet, Jones, Kemp, Lake, LeFavour, Loertscher, Martinez, Mathews,
      McGeachin, McKague, Miller, Mitchell, Moyle, Nielsen, Nonini,
      Pasley-Stuart, Pence, Raybould, Ring, Ringo, Rusche, Rydalch, Sali,
      Sayler, Schaefer, Shepherd(2), Shepherd(8), Shirley, Skippen,
      Smith(30), Smith(24), Smylie, Snodgrass, Trail, Wood, Mr. Speaker
      NAYS -- None
      Absent and excused -- Bedke, Roberts, Stevenson, Wills
    Floor Sponsors - Eskridge & Anderson
    Title apvd - to Senate
03/30    To enrol - Rpt enrol - Pres signed
03/31    Sp signed - To Governor
04/06    Governor signed
         Session Law Chapter 311
         Effective: 07/01/05

Bill Text


                                                                        
                                                                        
  ]]]]              LEGISLATURE OF THE STATE OF IDAHO             ]]]]
 Fifty-eighth Legislature                   First Regular Session - 2005
                                                                        
                                                                        
                                       IN THE SENATE
                                                                        
                                    SENATE BILL NO. 1192
                                                                        
                                 BY STATE AFFAIRS COMMITTEE
                                                                        
  1                                        AN ACT
  2    RELATING TO  THE  IDAHO  ENERGY  RESOURCES  AUTHORITY  ACT;  AMENDING  SECTION
  3        67-8902, IDAHO CODE, AS ADDED BY SECTION 1, HOUSE BILL NO. 106, ENACTED BY
  4        THE  FIRST  REGULAR SESSION OF THE FIFTY-EIGHTH IDAHO LEGISLATURE, TO PRO-
  5        VIDE FURTHER  DECLARATION  OF  NECESSITY  AND  PURPOSE;  AMENDING  SECTION
  6        67-8903, IDAHO CODE, AS ADDED BY SECTION 1, HOUSE BILL NO. 106, ENACTED BY
  7        THE  FIRST  REGULAR SESSION OF THE FIFTY-EIGHTH IDAHO LEGISLATURE, TO FUR-
  8        THER DEFINE TERMS AND TO MAKE A  TECHNICAL  CORRECTION;  AMENDING  SECTION
  9        67-8908, IDAHO CODE, AS ADDED BY SECTION 1, HOUSE BILL NO. 106, ENACTED BY
 10        THE  FIRST  REGULAR SESSION OF THE FIFTY-EIGHTH IDAHO LEGISLATURE, TO PRO-
 11        VIDE ADDITIONAL POWERS  TO  IDAHO  ENERGY  RESOURCES  AUTHORITY;  AMENDING
 12        CHAPTER  89,  TITLE  67, IDAHO CODE, AS ADDED BY SECTION 1, HOUSE BILL NO.
 13        106, ENACTED BY THE FIRST REGULAR SESSION OF THE FIFTY-EIGHTH IDAHO LEGIS-
 14        LATURE, BY THE ADDITION OF A NEW SECTION 67-8925, IDAHO CODE, TO AUTHORIZE
 15        THE IDAHO ENERGY RESOURCES AUTHORITY TO  UNDERTAKE  ANY  RENEWABLE  ENERGY
 16        PROJECT  FOR  THE  BENEFIT  OF ONE OR MORE INDEPENDENT POWER PRODUCERS AND
 17        ISSUE ITS BONDS TO FINANCE THE COST THEREOF AND TO PROVIDE APPLICATION  TO
 18        AN INDEPENDENT POWER PRODUCER.
                                                                        
 19    Be It Enacted by the Legislature of the State of Idaho:
                                                                        
 20        SECTION 1.  That Section 67-8902, Idaho Code, as added by Section 1, House
 21    Bill  No.  106, enacted by the First Regular Session of the Fifty-eighth Idaho
 22    Legislature, be, and the same is hereby amended to read as follows:
                                                                        
 23        67-8902.  DECLARATION OF NECESSITY AND PURPOSE. (1) It  is  hereby  deter-
 24    mined and declared that:
 25        (a)  Industrial,  irrigation,  commercial and residential consumers in the
 26        state of Idaho receive electric service from various investor-owned, coop-
 27        erative and municipal utilities and the ability of these utilities to pro-
 28        vide reliable and economic electric services at stable prices is essential
 29        to the economy and the economic development of the state of Idaho  and  to
 30        the health, safety and welfare of its people;
 31        (b)  The  regional interconnection of electric utilities causes events and
 32        conditions in other western states to have a  significant  impact  of  the
 33        operations of utilities in the state of Idaho and the restructuring of the
 34        electric  industry  in recent years by the federal government and in other
 35        states has exposed all utilities in Idaho, and  the  consumers  served  by
 36        them,  to  volatile  market prices, reliability concerns and other adverse
 37        conditions;
 38        (c)  It is in the best interest of the state of Idaho and its people  that
 39        sufficient and reliable electric generation and transmission resources are
 40        developed  and made available at cost-based rates in order to enable these
 41        utilities to meet existing and future demands for  electric  services,  to
 42        provide  adequate  reserves  and to promote reliability at the most stable
 43        rates practicable;
                                                                        
                                           2
                                                                        
  1        (d)  The electric utility and energy industries are and will  continue  to
  2        be  capital-intensive  industries  and  the availability of cost-effective
  3        financing to investor-owned,  cooperative  and  municipal  utilities  will
  4        enhance  the  ability  of  these utilities to provide and promote economic
  5        electric services to consumers in the state;
  6        (e)  Coordination, cooperation and joint ventures between and  among  such
  7        utilities  with  one  another  and with the private, cooperative, federal,
  8        state and municipal utilities and  agencies  that  provide  wholesale  and
  9        retail electric services in the western states will promote regional elec-
 10        tric reliability and stability and will provide economies of scale; and
 11        (f)  It  is  the  intent  of  the  legislature  to create the Idaho energy
 12        resources authority to promote the development and financing of facilities
 13        for the benefit of participating utilities and to accomplish the  purposes
 14        stated  above,  and to authorize the authority to exercise all such powers
 15        as are necessary to enable it to achieve such purposes and to thereby pro-
 16        mote and protect the economy of the state of Idaho and the health,  safety
 17        and welfare of its people; and
 18        (g)  It  is  in  the best interest of the state of Idaho and its people to
 19        encourage and promote the development of  renewable  energy  resources  in
 20        order   to   develop   sustainable   sources   of  energy  supply,  reduce
 21        inefficiencies in the use of electric energy  and  enhance  the  long-term
 22        stability of the energy resources and requirements of the state.
 23        (2)  Nothing  contained  herein is intended or shall be construed to limit
 24    or restrict the authority  of  the  Idaho  public  utilities  commission  with
 25    respect to the regulation of electric corporations and public utilities pursu-
 26    ant to title 61, Idaho Code.
                                                                        
 27        SECTION 2.  That Section 67-8903, Idaho Code, as added by Section 1, House
 28    Bill  No.  106, enacted by the First Regular Session of the Fifty-eighth Idaho
 29    Legislature, be, and the same is hereby amended to read as follows:
                                                                        
 30        67-8903.  DEFINITIONS. When used in  this  chapter,  the  following  terms
 31    shall have the following meanings:
 32        (1)  "Authority" means the Idaho energy resources authority created pursu-
 33    ant to section 67-8904, Idaho Code.
 34        (2)  "Board" means the board of directors of the authority.
 35        (3)  "Bonds"  means any bonds, notes, certificates or other obligations or
 36    evidences of indebtedness issued by the authority.
 37        (4)  "Commission" means the Idaho public utilities commission created pur-
 38    suant to section 61-201, Idaho Code.
 39        (5)  "Electric cooperative" means a cooperative corporation or association
 40    which is:
 41        (a)  Organized under the provisions of section 501(c)(12) or 1381  of  the
 42        Internal Revenue Code;
 43        (b)  Is  an  Idaho  nonprofit corporation pursuant to chapter 3, title 30,
 44        Idaho Code; and
 45        (c)  Is an operating entity or successor entity thereof which owns facili-
 46        ties and provides electric service to customers in Idaho as of the  effec-
 47        tive date of this chapter.
 48        (6)  "Facility" means any facility necessary, used or useful in connection
 49    with  the  generation  or  transmission  of  electric power and energy and any
 50    renewable energy generation project, in each case including, but  not  limited
 51    to,  all  real and personal property, fuel supplies and transportation facili-
 52    ties, pollution control facilities and all equipment and  improvements  neces-
 53    sary  or  desirable  in  connection  with a facility. "Facility" shall include
                                                                        
                                           3
                                                                        
  1    facilities owned in whole or in part by the authority or a participating util-
  2    ity, including undivided ownership interests in facilities,  leasehold  inter-
  3    ests  in facilities and other estates, but excludes a generating facility that
  4    sells any portion of its output as a qualifying facility  to  a  participating
  5    utility  under  provisions  of  the  public utility regulatory policies act of
  6    1978, 16 U.S.C. section 2601 et sec seq.
  7        (7)  "Independent power producer" means any public or private  corporation
  8    which  is not itself a participating utility, but which may be an affiliate of
  9    a participating utility, that develops any renewable energy generation project
 10    undertaken by the authority pursuant to this chapter.
 11        (8)  "Participating utility" means, with respect to any facilities  under-
 12    taken  by the authority pursuant to this chapter, any public or private corpo-
 13    ration, electric cooperative or other cooperative corporation or  association,
 14    municipal  corporation,  political subdivision of this state or another state,
 15    state or federal agency, joint operating entity or other entity that:
 16        (a)  Owns and operates an electric utility system that  provides  electric
 17        services  to  consumers of electricity located in an existing service area
 18        within the boundaries of this state;
 19        (b)  Provides  electric  generation,  power  supply,  transmission  and/or
 20        ancillary and related services at wholesale to one (1) or more participat-
 21        ing utilities described in paragraph (a) of this subsection; or
 22        (c)  Is organized or operates as a regional transmission organization cov-
 23        ering all or any part of the state of Idaho and  one  (1)  or  more  other
 24        states.
 25        (89)  "Renewable  energy"  means a source of energy that occurs naturally,
 26    is regenerated naturally or uses as a fuel source, a waste product or  byprod-
 27    uct  from  a  manufacturing  process  including,  but  not limited to, open or
 28    closed-loop biomass, fuel cells, geothermal energy, waste heat,  cogeneration,
 29    solar energy, waterpower and wind.
 30        (10) "Renewable  energy  generation  project" means an electric generating
 31    facility or system that uses renewable energy as its primary source of  energy
 32    to generate electricity.
 33        (11) "Revenues"  means  all  receipts, purchase payments, loan repayments,
 34    lease payments, rents, fees and charges, and  all  other  income  or  receipts
 35    derived by the authority from a participating utility.
                                                                        
 36        SECTION 3.  That Section 67-8908, Idaho Code, as added by Section 1, House
 37    Bill  No.  106, enacted by the First Regular Session of the Fifty-eighth Idaho
 38    Legislature, be, and the same is hereby amended to read as follows:
                                                                        
 39        67-8908.  POWERS. (1) The authority shall have the following powers, which
 40    are hereby declared to be necessary to enable the authority to carry  out  and
 41    effectuate  the  purposes  and  provisions  of this chapter, together with all
 42    powers incidental thereto or necessary for the performance thereof:
 43        (a)  To have perpetual succession as a body politic and corporate;
 44        (b)  To adopt bylaws for the regulation of its affairs and the conduct  of
 45        its business;
 46        (c)  To  sue and be sued and to prosecute and defend, at law or in equity,
 47        in any court having jurisdiction of the subject matter and of the parties;
 48        (d)  To have and to use a corporate seal and to alter the same  at  pleas-
 49        ure;
 50        (e)  To maintain an office at such place or places as it may designate;
 51        (f)  To  make and execute contracts and all other instruments necessary or
 52        convenient for the exercise of its powers and functions under  this  chap-
 53        ter;
                                                                        
                                           4
                                                                        
  1        (g)  To  acquire,  whether  by  purchase,  gift,  grant,  bequest, devise,
  2        exchange, eminent domain or otherwise, own, hold, improve,  lease,  trans-
  3        fer,  assign,  pledge and dispose of, any real or personal property or any
  4        interest therein necessary or convenient  in connection with any  facility
  5        or  its  purposes  under this chapter; provided however, that the power of
  6        eminent domain is limited to only those purposes and participating  utili-
  7        ties as authorized by section 7-701, Idaho Code;
  8        (h)  To acquire, construct, reconstruct, renovate, improve, replace, main-
  9        tain, repair, manage, operate, lease as lessee or lessor, and regulate any
 10        facility; to enter into contracts for any and all of such purposes and for
 11        the  acquisition and management of fuel supplies, provided such is reason-
 12        ably necessary for the operation and maintenance of any facility; to enter
 13        into contracts and agreements to manage risks associated with the purchase
 14        and sale of energy and energy commodities,  provided  such  is  reasonably
 15        necessary  for  the  operation  and maintenance of any facility; and shall
 16        designate one (1) or more qualified participating utilities  as  agent  or
 17        agents  of  the authority, as agreed to among the participating utilities,
 18        with respect to the foregoing;
 19        (i)  To sell, lease or otherwise provide by contract to one  (1)  or  more
 20        participating utilities the services, output or product provided by any or
 21        all of the facilities undertaken by the authority upon such terms and con-
 22        ditions  as  the  authority  and  the  participating  utilities shall deem
 23        proper, and to establish, charge, collect and revise  from  time  to  time
 24        such  rents, fees and charges for such services, output or product as pro-
 25        vided for in this chapter;
 26        (j)  To borrow money and to issue bonds for any of the purposes  described
 27        in  this chapter, to issue refunding bonds and to enter into contracts and
 28        agreements determined by the authority to be  necessary  or  desirable  to
 29        manage its debt service and interest costs;
 30        (k)  To  establish  rules and regulations for the use of facilities and to
 31        designate a participating utility as its agent,  to  establish  rules  and
 32        regulations  for  the use of the facilities undertaken or operated by such
 33        participating utility;
 34        (l)  To employ or contract for consulting  engineers,  architects,  attor-
 35        neys,  accountants,  construction  and financial experts, superintendents,
 36        managers, and such other employees and agents as may be necessary  in  its
 37        judgment and to fix their compensation;
 38        (m)  To  enter  into  contracts, agreements or other transactions with and
 39        accept grants and the cooperation of  the  United  States  or  any  agency
 40        thereof or any state or any agency or governmental subdivision thereof, in
 41        furtherance of the purposes of this chapter including, but not limited to,
 42        the development, maintenance, operation, and financing of any facility and
 43        to  do  any  and all things necessary in order to avail itself of such aid
 44        and cooperation;
 45        (n)  To receive and accept aid or contributions from any source of  money,
 46        property,  labor,  or other things of value, to be held, used, and applied
 47        to carry out the purposes of this chapter subject to such conditions  upon
 48        which  such  grants and contributions may be made, including, but not lim-
 49        ited to, gifts or grants from any  department  or  agency  of  the  United
 50        States or any state for any purpose consistent with this chapter;
 51        (o)  To  assign  and pledge all or any part of its revenues and income and
 52        to mortgage or otherwise encumber any or all of  its  facilities  and  the
 53        site  or sites thereof, whether then owned or thereafter acquired, for the
 54        benefit and security of the holders of bonds issued to finance such facil-
 55        ities or any portion thereof;
                                                                        
                                           5
                                                                        
  1        (p)  To make loans to any participating utility to finance the cost of any
  2        facilities in accordance with an agreement between the authority and  such
  3        participating utility;
  4        (q)  To  make  secured  or  unsecured  loans to a participating utility to
  5        refinance obligations and indebtedness incurred for facilities  undertaken
  6        and  completed  prior  to  or after the enactment of this chapter when the
  7        authority finds that such financing is in the public interest  and  either
  8        alleviates  the financial hardship upon the participating utility or is in
  9        connection with other financing by the authority  for  such  participating
 10        utility or may be expected to result in a cost-effective delivery of elec-
 11        tricity  to the consumers served by the participating utility, or any com-
 12        bination thereof;
 13        (r)  To charge to and equitably apportion  its  administrative  costs  and
 14        expenses  incurred  in  the exercise of the powers and duties conferred by
 15        this chapter among the participating utilities that have entered into con-
 16        tracts with the authority;
 17        (s)  To procure insurance against any loss in connection with its property
 18        and other assets in such amounts and from such insurers as it deems desir-
 19        able and to self-insure against such risks as it shall deem to be  reason-
 20        able;
 21        (t)  To  invest  any  funds  not needed for immediate use or disbursement,
 22        including any funds held in reserve, in:
 23             (i)   Bonds, notes and other obligations of the United States or  any
 24             agency  or  instrumentality  thereof  and other securities secured by
 25             such bonds, notes or other obligations;
 26             (ii)  Money market funds which are insured or the assets of which are
 27             limited to obligations of the United States or any agency or  instru-
 28             mentality thereof;
 29             (iii) Time certificates of deposit and savings accounts;
 30             (iv)  Commercial  paper  which, at the time of its purchase, is rated
 31             in the highest category by a nationally recognized rating service;
 32             (v)   Property or securities in which the state treasurer may  invest
 33             funds  in the state treasury pursuant to section 67-1210, Idaho Code;
 34             and
 35             (vi)  With respect to any funds representing bond proceeds or amounts
 36             pledged to the payment of bonds, such other  investments  as  may  be
 37             specified  in  a bond resolution or trust indenture securing bonds of
 38             the authority;
 39        (u)  To participate in cooperative ventures with any agencies or organiza-
 40        tions in order to provide affordable and reliable energy to the  residents
 41        of the state; and
 42        (v)  To  undertake and finance renewable energy generation projects devel-
 43        oped by an independent power producer; and
 44        (w)  To do all things necessary and convenient to carry out  the  purposes
 45        of this chapter.
 46        (2)  Notwithstanding  any  other  provision of this chapter, the authority
 47    shall have no power to:
 48        (a)  Acquire the operating property of any investor-owned, private,  coop-
 49        erative,  municipal  or other utility by the exercise of the power of emi-
 50        nent domain;
 51        (b)  Provide financing for the acquisition of the  operating  property  of
 52        any  such  utility  by  or  under threat of eminent domain, in either case
 53        unless such utility consents in writing to the acquisition; or
 54        (c)  Deliver retail electricity or related retail products or services  to
 55        any ultimate consumer, whether in violation of the Idaho electric supplier
                                                                        
                                           6
                                                                        
  1        stabilization act or otherwise.
                                                                        
  2        SECTION  4.  That Chapter 89, Title 67, Idaho Code, as added by Section 1,
  3    House Bill No. 106, enacted by the First Regular Session of  the  Fifty-eighth
  4    Idaho  Legislature, be, and the same is hereby amended by the addition thereto
  5    of a NEW SECTION, to be known and designated as Section 67-8925,  Idaho  Code,
  6    and to read as follows:
                                                                        
  7        67-8925.  RENEWABLE  ENERGY  GENERATION PROJECTS. The authority may under-
  8    take any renewable energy generation project for the benefit  of  one  (1)  or
  9    more  independent  power producers and may issue its bonds to finance the cost
 10    thereof, all to the same extent and subject to the same provisions  applicable
 11    to  the  undertaking  and financing of other facilities for the benefit of one
 12    (1) or more participating utilities. In furtherance of the foregoing, an inde-
 13    pendent power producer shall be deemed to  be  a  participating  utility  with
 14    respect  to  a  renewable  energy  generation project for purposes of sections
 15    67-8909, 67-8910 and 67-8911, Idaho Code.

Statement of Purpose / Fiscal Impact


                       STATEMENT OF PURPOSE

                             RS 14977

Amendment to the Idaho Energy Resources Authority Act.
House Bill 106 creates the Idaho Energy Resources Authority to
finance the construction of electric generation and transmission
projects by electric utilities.  

This proposed legislation acts as a "trailer bill" or amendment
to H 106 so that independent (non-utility) developers of
renewable energy projects may also request financing from the
Idaho Energy Resources Authority.  

House Bill 30, the original bill creating the Idaho Energy
Resources Authority, combined the financing of both generation
and transmission facilities and renewable energy facilities. 
Sponsors of the proposed Act believed that renewable energy
project financing by independent developers needed to be
contained in a bill separate from utility financing of generation
and transmission facilities.


                          FISCAL IMPACT

This legislation will have no fiscal impact on the state.



Contact  
Name:  Representative George Eskridge
       Representative Eric Anderson
       Senator Brent Hill
Phone: 332-1000


STATEMENT OF PURPOSE/FISCAL NOTE                     S 1192