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Long‐TermRenewableResourcesProcurementPlanfiledforICCApproval December4,2017

Long‐TermRenewableResourcesProcurementPlan

FiledforIllinoisCommerceCommissionApprovalDecember4,2017

PreparedinaccordancewiththeIllinoisPowerAgencyAct(20ILCS3855),andtheIllinoisPublicUtilitiesAct(220ILCS5)

RENEWABLERESOURCES


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TableofContents1. Introduction......................................................................................................................................................................1 1.1. ChangingtheRPSPlanningFramework.....................................................................................................2 1.2. PlanOrganization.................................................................................................................................................3 1.3. ActionPlan..............................................................................................................................................................4

2. Legislative/RegulatoryRequirementsofthePlan............................................................................................5 2.1. RenewableEnergyResourceProcurementPriortoPublicAct99‐0906.....................................5 2.1.1. OriginalRPS—EligibleRetailCustomerLoad.................................................................................5 2.1.2. OriginalRPS—HourlyPricingCustomers........................................................................................6 2.1.3. OriginalRPS—ARESCompliance.........................................................................................................6

2.2. PublicAct99‐0906..............................................................................................................................................9 2.2.1. LegislativeFindings.................................................................................................................................10 2.2.2. ChangestotheRPS...................................................................................................................................11 2.2.3. NewConceptsandTerms......................................................................................................................11 2.2.4. Long‐TermRenewableResourcesProcurementPlan..............................................................12 2.2.5. PlanRequirements...................................................................................................................................12 2.2.6. ItemsNotIncludedinLong‐TermRenewableResourceProcurementPlan...................17 2.2.7. PlanDevelopmentandApproval.......................................................................................................18 2.2.8. PlanUpdates...............................................................................................................................................20

2.3. TheRPSandPercentage‐BasedGoalsoftheRPS.................................................................................20 2.3.1. LoadApplicabletoRPSGoals..............................................................................................................20 2.3.2. EligibleProjectsfortheIllinoisRPS.................................................................................................21 2.3.3. ComplianceMechanism:RECsvs.“RenewableEnergyResources”....................................24 2.3.4. RPSFundingandRateImpactCap....................................................................................................25 2.3.5. EmploymentOpportunities..................................................................................................................26

2.4. QuantitativeNewBuildTargetsoftheRPS.............................................................................................26 2.4.1. QuantitativeProcurementRequirements......................................................................................26 2.4.2. “Newwindproject”and“newphotovoltaicproject”Definition...........................................27 2.4.3. InitialForwardProcurements.............................................................................................................29 2.4.4. SubsequentForwardProcurements.................................................................................................29 2.4.5. BalancingExpectedWindRECsvs.SolarRECs............................................................................29

2.5. AdjustableBlock&CommunityRenewableGenerationPrograms...............................................30 2.5.1. AdjustableBlockProgram....................................................................................................................30 2.5.2. CommunityRenewableGenerationProgram...............................................................................34

2.6. IllinoisSolarforAll............................................................................................................................................34 2.6.1. IllinoisSolarforAll—Overview..........................................................................................................35 2.6.2. IllinoisSolarforAll—Sub‐programs................................................................................................37 2.6.3. IllinoisSolarforAll—AdditionalRequirements..........................................................................40 2.6.4. IllinoisSolarforAll—Third‐partyprogramadministrator.....................................................41

3. RPSGoals,Targets,andBudgets............................................................................................................................42 3.1. StatewideGoalsandAllocationofCostandRECsfromRPSProcurementstoEachUtility43 3.2. ImpactofthePhaseoutofAlternativeRetailElectricSupplierRPSObligations....................44 3.3. Section1‐75(c)(1)(H)(i)ARESOptiontoSupplyRECsfortheirRetailCustomers................44 3.4. MidAmericanVolumes.....................................................................................................................................46 3.5. CostCapandCostRecovery...........................................................................................................................46 3.6. RPSComplianceProcurementPriorities..................................................................................................47 3.7. Wind/SolarMatchingRequirementandSolarSplit............................................................................48 3.8. RECPortfolio........................................................................................................................................................48 3.9. ExistingRECPortfolios‐RECsAlreadyUnderContract....................................................................49


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3.10. InitialForwardProcurement........................................................................................................................50 3.11. StatewideRECPortfolio..................................................................................................................................51 3.12. Loads,RPSGoalsandTargets,andRECGaps.........................................................................................51 3.13. ApplicableRetailCustomerLoad................................................................................................................51 3.14. RPSGoalsandTargets......................................................................................................................................52 3.15. OverallRECProcurementTargets(RECGaps)......................................................................................52 3.16. ProcurementTargetstoMeetSpecificWind‐SolarRequirementandOverallRPSTargets53 3.17. RPSBudget............................................................................................................................................................54 3.17.1. UtilitiesBudgets..................................................................................................................................................55 3.18. SummaryofRECProcurementTargetsandRPSBudgets................................................................58 3.19. AlternativeCompliancePaymentFundsHeldbytheUtilities.........................................................58 3.20. ImpactofRPSBudgetonProcurementVolumes..................................................................................59

4. RenewableEnergyCreditEligibility.....................................................................................................................60 4.1. AdjacentStateRequirement..........................................................................................................................60 4.1.1. PublicInterestCriteria.....................................................................................................................................62 4.1.2. ApplicationProcess...........................................................................................................................................67 4.2. CostRecoveryRequirement..........................................................................................................................68

5. CompetitiveProcurementSchedule.....................................................................................................................71 5.1. StatutoryRequirements..................................................................................................................................72 5.2. BackgroundonpastRECProcurementsconductedbytheIPA......................................................73 5.3. UpdatestotheAgency’sCompetitiveProcurementApproach.......................................................74 5.4. RevisedRECEligibility.....................................................................................................................................75 5.5. CreditRequirements.........................................................................................................................................76 5.6. Benchmarks..........................................................................................................................................................76 5.7. ProcurementsforRECsfromNewProjectsvs.RECstoMeetAnnualGoals..............................77 5.7.1. FirstSubsequentForwardProcurement........................................................................................80 5.7.2. BrownfieldSiteForwardProcurement...........................................................................................82

5.8. OtherProcurementstoMeetRPSTargets...............................................................................................83 5.8.1. PhotovoltaicForwardProcurement.................................................................................................83 5.8.2. SecondSubsequentForwardProcurement...................................................................................85 5.8.3. OtherRenewables15‐YearForwardProcurement....................................................................86 5.8.4. CommunityRenewableGenerationProgramForwardProcurement................................87

5.9. 2018and2019SpotProcurements............................................................................................................89 5.10. ConsiderationofPotentialProcurementsafter2019andThrough2030..................................91

6. AdjustableBlockProgram.........................................................................................................................................92 6.1. Background...........................................................................................................................................................92 6.2. LessonsFromOtherJurisdictions...............................................................................................................93 6.2.1. ManagingInitialDemand......................................................................................................................93

6.3. BlockStructure....................................................................................................................................................94 6.3.1. TransitionbetweenBlocks...................................................................................................................96

6.4. RECPricingModel..............................................................................................................................................97 6.5. AdjustmentsandAdders..............................................................................................................................101 6.5.1. SizeCategoryAdjustments................................................................................................................101 6.5.2. CommunitySolar...................................................................................................................................102 6.5.3. AdderstoAdjustforChangingSystemRevenue......................................................................103

6.6. PaymentTerms................................................................................................................................................103 6.7. Contracts.............................................................................................................................................................105 6.8. AdjustmentstoBlocksandPrices............................................................................................................105 6.8.1. NetMeteringCapAdjustment..........................................................................................................107


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6.8.2. SmartInverterRebate.........................................................................................................................107 6.8.3. FederalSolarInvestmentTaxCreditAdjustment....................................................................108 6.8.4. TariffsonForeignPhotovoltaicModulesandCells.................................................................109

6.9. ApprovedVendors..........................................................................................................................................111 6.10. ProgramAdministrator................................................................................................................................113 6.11. ProgramLaunch..............................................................................................................................................114 6.12. ProjectRequirements....................................................................................................................................114 6.12.1. TechnicalSystemRequirements.....................................................................................................114 6.12.2. MeteringRequirements......................................................................................................................115

6.13. CustomerInformationRequirements/ConsumerProtections....................................................116 6.13.1. CommunitySolar...................................................................................................................................118 6.13.2. MonitoringofConsumerComplaints............................................................................................119

6.14. ApplicationProcess........................................................................................................................................119 6.14.1. Batches.......................................................................................................................................................119 6.14.2. Systemsbelow25kW..........................................................................................................................120 6.14.3. BatchSize..................................................................................................................................................120 6.14.4. BatchReview...........................................................................................................................................121 6.14.5. ConvertingSystemSizeintoRECQuantities..............................................................................121 6.14.6. BatchContractApproval....................................................................................................................122

6.15. ProjectDevelopmentTimelineandExtensions..................................................................................122 6.15.1. DevelopmentTimeAllowed..............................................................................................................122 6.15.2. Extensions................................................................................................................................................123 6.15.3. ProjectCompletionandEnergization...........................................................................................123 6.15.4. AdditionalRequirementsforCommunitySolarProjects......................................................124 6.15.5. RECDelivery............................................................................................................................................125

6.16. OngoingPerformanceRequirements......................................................................................................126 6.16.1. CreditRequirements............................................................................................................................126 6.16.2. OptionstoReduceRECDeliveryObligations.............................................................................127

6.17. AnnualReport...................................................................................................................................................128 7. CommunityRenewableGenerationProjects.................................................................................................130 7.1. StatutoryOverview........................................................................................................................................130 7.2. EligibleGeneratingTechnologiesandProcurement/ProgramEligibility...............................133 7.3. Co‐locationofProjects..................................................................................................................................133 7.3.1. Co‐locationStandard............................................................................................................................134

7.4. EligibilityofProjectsLocatedinRuralElectricCooperativesandMunicipalUtilities.......135 7.5. TypesofCommunityRenewableGenerationProjects....................................................................137 7.6. SubscriberRequirements............................................................................................................................138 7.6.1. SmallSubscriberParticipation........................................................................................................138 7.6.2. MarketingtoSmallSubscribers.......................................................................................................139 7.6.3. Marketing Claims Related to the Ownership of RECs and Community RenewableGenerationSubscriptions.......................................................................................................................................142

7.7. UtilityResponsibilities..................................................................................................................................143 8. IllinoisSolarforAllProgram................................................................................................................................145 8.1. Overview.............................................................................................................................................................145 8.2. DesignConsiderations..................................................................................................................................145 8.2.1. RelationshipwiththeAdjustableBlockProgram....................................................................145 8.2.2. EconomicBenefits.................................................................................................................................146

8.3. ProgramLaunch..............................................................................................................................................147 8.4. FundingandBudget.......................................................................................................................................147 8.4.1. RenewableEnergyResourcesFundFundingAvailable........................................................148


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8.4.2. UtilitiesAnnualFundingAvailable.................................................................................................149 8.4.3. Section16‐108(k)Funding................................................................................................................150 8.4.4. SettingBudgets.......................................................................................................................................151 8.4.5. PaymentStructure................................................................................................................................152

8.5. Programs.............................................................................................................................................................153 8.6. SettingIncentiveLevels................................................................................................................................154 8.6.1. Low‐IncomeDistributedGenerationIncentive........................................................................155 8.6.2. Low‐IncomeCommunitySolarProjectInitiative.....................................................................156 8.6.3. IncentivesforNon‐ProfitsandPublicFacilities.......................................................................158 8.6.4. Low‐IncomeCommunitySolarPilotProjects............................................................................160

8.7. ProvidingGuidanceandEducation..........................................................................................................161 8.8. IllinoisSolarforAllProgramAdministrator........................................................................................162 8.9. QualityAssurance...........................................................................................................................................163 8.10. CoordinationwithJobTrainingPrograms...........................................................................................163 8.11. AdditionalRequirementsforApprovedVendors..............................................................................165 8.12. ApplicationProcess........................................................................................................................................166 8.13. CustomerEligibility........................................................................................................................................167 8.13.1. IncomeGuidelines.................................................................................................................................167 8.13.2. DeterminingIncomeEligibility........................................................................................................170

8.14. ConsumerProtections...................................................................................................................................171 8.15. EnvironmentalJusticeCommunities.......................................................................................................172 8.15.1. Definitions................................................................................................................................................172 8.15.2. ProposedApproachforDefiningEnvironmentalJusticeCommunities..........................175 8.15.3. EnvironmentalJusticeCommunityDesignations.....................................................................177 8.15.4. EnvironmentalJusticeCommunities25%Goal........................................................................177

8.16. ProgramChanges............................................................................................................................................177 8.17. Evaluation...........................................................................................................................................................178

TablesTable3‐1:UtilityRECCostAllocations.........................................................................................................................43 Table3‐2.RECProcurementCostCapRatebyUtility...........................................................................................47 Table3‐3.AmerenIllinoisExistingRECPortfolio...................................................................................................49 Table3‐4.ComEdExistingRECPortfolio....................................................................................................................49 Table3‐5.MidAmericanExistingRECPortfolio.......................................................................................................50 Table3‐6.InitialForwardProcurementRECs..........................................................................................................50 Table3‐7.StatewideRECPortfolio................................................................................................................................51 Table3‐8.RetailCustomerLoadApplicabletotheComplianceYear..............................................................52 Table3‐9.StatewideRPSGoalsandTargets..............................................................................................................52 Table3‐10.StatewideOverallRECGap........................................................................................................................53 Table3‐11.StatewideRECPortfolioandMinimumRECProcurementTargets.........................................54 Table3‐12.AmerenIllinoisRPSBudget......................................................................................................................56 Table3‐13.ComEdRPSBudget.......................................................................................................................................56 Table3‐14.MidAmericanRPSBudget..........................................................................................................................57 Table3‐15.StatewideRPSBudget.................................................................................................................................57 Table3‐16.StatewideRECGapandAvailableRPSBudget..................................................................................58 Table4‐1:NaturalGas‐FiredGenerationEmissionsRates..................................................................................63


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Table4‐2:WindDuration/DirectionFactors............................................................................................................64 Table5‐1:2018and2019ForwardProcurementsSummary............................................................................79 Table5‐2:2018and2019SpotProcurementsSummary....................................................................................80 Table6‐1:IllustrativeBlockOpeningVolumes(MW)...........................................................................................97 Table6‐2:BlockGroupRECPrices($/REC)..............................................................................................................99 Table6‐3:SizeCategoryAdjustments.......................................................................................................................101 Table6‐4:CommunitySolarAdders..........................................................................................................................103 Table7‐1:FederalStatutesthatApplytoCommunitySolar............................................................................140 Table7‐2:IllinoisStatutesthatApplytoCommunitySolar.............................................................................140 Table8‐1:UtilityFunding...............................................................................................................................................150 Table8‐2:IllinoisSolarforAllBudgets.....................................................................................................................152 Table8‐3:DeliveryYear2018‐2019IllinoisSolarforAllFundingAllocations.......................................154 Table8‐4:IncentivesfortheLow‐IncomeDistributedGenerationProgram($/REC).........................156 Table8‐5:IncentivesforLow‐IncomeCommunitySolarProjects($/REC)..............................................158 Table8‐6:IncentivesforNon‐ProfitsandPublicFacilities($/REC).............................................................159 Table8‐7:HUDIncomeLimits......................................................................................................................................168 Table8‐8:EligibilityGuidelinesforLIHEAPandWAPinIllinois..................................................................168 Table8‐9:SummaryofCalEnviroScreen3.0IdentificationMethodology..................................................174

FiguresFigure3‐1.StatewideApplicableRetailLoad,RECPortfolioandOverallRECGap...................................53 Figure4‐1:PollutionScoreCalculation.......................................................................................................................64 Figure4‐2:FuelandResourceDiversityScore.........................................................................................................65 Figure4‐3:ReliabilityandResiliencyScore...............................................................................................................66 Figure4‐4:CO2ScoreCalculation...................................................................................................................................67 Figure6‐1:GroupABlocks.............................................................................................................................................100 Figure6‐2:GroupBBlocks.............................................................................................................................................100 Figure8‐1:SpringfieldQualifiedCensusTracts....................................................................................................169 Figure8‐2:CalEnviroScreenFormula........................................................................................................................176

AppendicesAppendixA:LegislativeComplianceIndexAppendixB:SummariesofGoalsandTargets,RPSPortfolios,andBudgetsAppendixC:ReviewofOtherProgramsAppendixD:RenewableEnergyCreditPricingModelDescriptionAppendixE:RenewableEnergyCreditPricingModels AppendixE‐1:AdjustableBlockProgramDistributedGenerationPricingModel AppendixE‐2:AdjustableBlockProgramCommunitySolarPricingModel AppendixE‐3:IllinoisSolarforAllDistributedGenerationIncentivePricingModel AppendixE‐4:IllinoisSolarforAllCommunitySolarPricingModel AppendixE‐5:IllinoisSolarforAllNon‐profitandPublicFacilityPricingModelAppendixF:IncomeEligibilityGuidelinesforIllinoisSolarForAll


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1. IntroductionThisisthefirstLong‐TermRenewableResourcesProcurementPlan(“Plan”)developedbytheIllinoisPowerAgency(“IPA”or“Agency”)pursuanttotheprovisionsofSections1‐56(b)and1‐75(c)oftheIllinoisPowerAgencyAct(“Act”or“IPAAct”),andSection16‐111.5ofthePublicUtilitiesAct(“PUA”).ThisPlan is the result ofPublicAct 99‐0906 (“P.A.99‐0906”), enactedDecember7, 2016,whichsubstantiallyrevisedtheIllinoisRenewablePortfolioStandard(“IllinoisRPS”or“RPS”).PublicAct99‐0906tookeffectonJune1,2017andprovidedfortheAgencytodevelopadraftPlanwithin120daysofthatdate.1ThereleaseofthedraftPlanonSeptember29,2017fulfilledthatrequirement.Interestedpartieshad45daystocommentonthedraftPlan,andtheAgencythenhad21daystorevisethePlantoprepareitforfilingforwiththeIllinoisCommerceCommission(“Commission”or“ICC”).ThefilingofthisPlanwiththeCommissiononDecember4,2017fulfillsthatrequirement.UnderSection16‐111.5(b)(5)(ii)(C)ofthePUA,theCommissionnowhas120daystoreviewthisPlanandenteritsOrderconfirmingormodifyingthisPlan.

ThisPlan addresseshow theAgencywill undertakea variety ofprogramsandprocurements forAmeren Illinois Company (“Ameren Illinois”), Commonwealth Edison Company (“ComEd”), andMidAmerican Energy Company (“MidAmerican”) to meet their annual obligations to purchaseRenewableEnergyCredits(“RECs”)tomeetthegoalsoftheIllinoisRPS.ItalsodescribeshowtheAgencywilldevelopandimplementtheIllinoisSolarforAllProgram,whichutilizesacombinationoffundsheldbytheAgencyintheRenewableEnergyResourcesFund(“RERF”),andfundssuppliedbythe utilities from ratepayer collections, to develop a program to support the development ofphotovoltaic(“PV”)resourcesthatwillbenefitlow‐incomehouseholdsandcommunities.

Prior to the development of this Plan, the planning for the procurement of renewable energyresourcesbytheAgencywascontainedintheAgency’sannualprocurementplan.WiththeenactmentofPublicAct99‐0906,theAgencyistaskedtodevelopthisseparatePlanfortheprocurementofRECsfortheutilities,whiletheannualprocurementplannowfocusesontheprocurementofelectricityandother“standardwholesaleproducts”fortheutilities(inaddition,theAgencyhasdevelopedaseparateZeroEmissionStandardProcurementPlanfortheprocurementofzeroemissioncreditspursuanttothenewSection1‐75(d‐5)oftheAct).

ThisPlancovers theAgency’sproposals forprocurementsandprograms tobe conductedduringcalendaryears2018and2019.TheAgencyexpectsthataspartofitsprocurementplanningprocessconductedincalendaryear2019forimplementationstartingincalendaryear2020,theAgencywillupdatethisPlanandproposeprocurementsandprograms(orrefinementstoexistingprograms)forsubsequentyears.TheseproposalsarespecificallydesignedtomeettheIllinoisRPSgoals forthedeliveryyears22017‐2018through2019‐2020aswellastobegintoputintoplacecontractsforRECdeliveriesforfuturedeliveryyearsthatwillhelptomeetthosefutureyears’RPSgoals.

1Section16.111.5(b)(5)(ii)(B)ofthePublicUtilitiesAct(220ILCS5)providesthatthedraftPlanshallbepublished“nolaterthan120days”aftertheeffectivedateoftheAct,whileSection1‐75(c)(1)(A)oftheIllinoisPowerAgencyAct(20ILCS3855)providesthatthedraftPlan“shallbereleasedforcommentnolaterthan160days”aftertheAct’seffectivedate.Toensurecompliancewitheitherprovision,theAgencyreleaseditsdraftPlanforcomment120daysaftertheeffectivedateoftheAct.2Anenergydeliveryyear(“deliveryyear”)runsfromJune1ofagivenyeartoMay31ofthefollowingyear.TheAgencyhashistoricallyinterpretedandusedthephrasing(e.g.)“2020deliveryyear”tomeanthe2020‐2021deliveryyear,andPublicAct99‐0906codifiedthatinterpretationbydefining“deliveryyear”inSection1‐10oftheIPAAct("theconsecutive12‐monthperiodbeginningJune1ofagivenyearandendingMay31ofthefollowingyear”)..


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1.1. ChangingtheRPSPlanningFrameworkWiththechangestotheIllinoisRPScontainedinPublicAct99‐0906,thereareseveralkeyimpactsontheRPSwhichinformhowtheAgencyhasdevelopedthisPlan.Theseinclude:

Thephase‐outofRPSobligationsforAlternativeRetailElectricSuppliers,andtheassociatedphase‐in of programs and procurements conducted by the Agency to cover the RPSobligations of all retail customers rather than just the eligible retail customers (theresidentialandsmallcommercialcustomerswhoremainedonutilitydefaultservice).WhileoverallRPSannualpercentagegoalsremainthesame,thischangesignificantlyincreasesthequantityofRECsunderconsiderationinthisPlancomparedtopreviousprocurementplansdevelopedbytheAgency.

TheintroductionofanewpublicinterestcriteriaforRECsfromfacilitiesinadjacentstates,alongwith a prohibition on RECs from facilities that have their costs recovered throughregulated rates, together decrease the pool of eligible RECs for IPA administeredprocurements.CombinedwithamoregeneralgoaltoemphasizetheprocurementofRECsfromnewprojects, thedesignof the rangeofprocurements contained in thisPlan,whilebuilding on previous procurements conducted by the Agency, focuses first on “ForwardProcurements”thatseekRECsfromnewprojects,andsecondarilyon“SpotProcurements”tomeetannualRPSpercentagegoals.

WhiletheRPSpreviouslycontainedpercentage‐basedcarve‐outsforspecifictechnologies,theRPSnowcontainsspecificquantity‐basedtargetsforRECsfromnewwindandnewsolarandbrownfieldsitesolarprojects.Thesegoalsmustbeconsideredandbalancedwiththeneedtomeetannualpercentage‐basedgoals.

InachangefromthecompetitiveprocurementmodelpreviouslyemployedbytheAgency(whichwasbased,inpart,onhowtheAgencyprocurespowertoservetheutilities’eligibleretailcustomers),theAgencyisnowdirectedtodevelopandimplementanAdjustableBlockProgram for photovoltaic distributed generation and community solar that includesadministrativelydeterminedRECpricesratherthanpricesdeterminedthroughpay‐as‐bidcompetitive procurements. The Agency also will now be managing an ongoing programratherthandiscreteprocurementevents.

Recognizingthegrowinginterestnationallyincommunitysolar,theAgencyisnowtaskedwith developing a community renewable generation program (to encompass bothcommunitysolaraswellasotherrenewablegeneratingtechnologies).Communityrenewablegenerationprojectsallowresidentialandbusinesscustomerstoparticipatedirectly intherenewable energy economy even if they cannot host solar panels (or other renewablegenerationdevices)on‐sitebysubscribingtosharesofafacilitylocatedwithintheirelectricutilityserviceterritory.

Toprovideopportunitiesforlow‐incomecustomersandcommunities,theIllinoisSolarforAll Program creates a separate set of incentives designed to overcome the barriers toparticipation in renewable energy programs that low‐income customers have historicallyfaced.

While this is not a comprehensive list of all changes to the Illinois RPS, it provides a high‐leveloverviewofthemostsignificantitemsandconstitutesabroadandambitiousvisionforsettingtheIllinoisRPSbackontrackandhelpingmakeIllinoisanationalleaderindevelopingitscleanenergyeconomy.GiventhescopeofthesechangesandthatthisisthefirstPlandevelopedbytheAgencyto


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meet these new goals, the Agency views this Plan as a starting point. While it sets in place theapproachanddirection theAgency intends to take in theyears to come, thisPlan is subject to aregulatory approval process before theCommissionduringwhich theproposed approachesmayevolve.Further,theAgencynotesthatthePlanwillbeupdatedintwoyears’time,whichwillallowtheAgencytoadjustandadapttowhatitlearnsasthisinitialPlanisimplemented.

1.2. PlanOrganization

ThisPlancontainseightchapters.

Chapter1isthisIntroduction.ItcontainsabriefoverviewofthePlanandasetofActionItemsthattheAgencyrequeststhattheCommissionexpresslyadoptaspartofitsapprovalofthisPlan.

Chapter2providesanoverviewofthelegislative/regulatoryrequirementscontainedintheIllinoisPowerAgencyActandthePublicUtilitiesAct(particularlythosethatresultfromtheenactmentofPublic Act 99‐0906) that lead to the development of this Long‐Term Renewable ResourcesProcurement Plan and the implementation of the resulting programs and procurements by theIllinoisPowerAgency.

Chapter3containscalculationsofRPStargets,summariesofRPSportfolios,andsummariesofRPSbudgets.

Chapter4discussestheeligibilityofRECsforuseintheIllinoisRPS.Inparticular,itaddressestwonew requirements of the RPS: eligibility of RECs from resources in adjacent states, and therequirementthatRECsdonotcomefromfacilitiesthatrecovertheircoststhroughregulatedrates.

Chapter5describesthecompetitiveprocurementstheAgencyproposestoconduct.Theseinclude:

SpotProcurementsfor2017‐2018and2018‐2019deliveryyears(anyresource) FirstSubsequentForwardProcurement(newutility‐scalewindRECs) BrownfieldSitePhotovoltaic15‐YearForwardProcurement ForwardProcurementfor1MillionnewPhotovoltaicRECs SpotProcurementfor2019‐2020deliveryyear(anyresource) SecondSubsequentForwardProcurement(newutility‐scalewindRECs) Other Renewables 15‐Year Forward Procurement (resources other than wind or

photovoltaic) CommunityRenewableGenerationProgram15‐YearForwardCompetitiveProcurementfor

Non‐PhotovoltaicProjects

Chapter 6 describes the Adjustable Block Program. This includes details on the structure of theblocks,REC(andadder)pricesandpricingmodeldevelopment, theapplicationprocess,paymentterms, theprocess foradjustingprices, theprocess forapprovingvendors,project specifications,consumerprotections,deliveryrequirements,andmore.

Chapter 7 describes the Community Renewable Generation Program including standards for co‐location,eligibilityofprojectslocatedinmunicipalutilitiesandruralelectriccooperatives,subscriberrequirements,consumerprotections,legalissuesaroundmarketingclaimsrelatedtoRECs,andtheresponsibilitiesofutilities.


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Chapter8describes the IllinoisSolar forAllProgram including theprogram fundinganddesign;customer terms,conditions,andeligibility;andanapproach todesignatingenvironmental justicecommunities.

1.3. ActionPlan

InthisPlan,theIPArecommendsthefollowingitemsforICCactionaspartofthePlan’sapproval:

1. ApprovetheRPStargets,andbudgetestimatesforAmerenIllinois,ComEd,andMidAmericanforthedeliveryyears2017‐2018through2019‐2020containedinChapter3.

2. ApprovetheAgency’sproposedapproachforconsideringandweightingthepublicinterestcriteriarelatedtofacilitieslocatedinadjacentstatesthatiscontainedinChapter4.

3. ApprovetheproposedprocurementscontainedinChapter5.4. ApprovethedesignoftheAdjustableBlockProgramcontainedinChapter6,includingthe

blockdesign,scheduleofRECprices(andadders),andprogramtermsandconditions.5. Approve the design and terms and conditions of the Community Renewable Generation

ProgramcontainedinChapter7.6. ApprovethedesignandtermsandconditionsoftheIllinoisSolarforAllProgramcontained

inChapter8.

TheIllinoisPowerAgencyrespectfullyfilesthisLong‐TermRenewableResourcesProcurementPlanforreviewandapprovalbytheIllinoisCommerceCommission.


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2. Legislative/RegulatoryRequirementsofthePlanThisSectionoftheIPA’sLong‐TermRenewableResourcesProcurementPlandescribesthelegislativeand regulatory requirements applicable to the Long‐Term Renewables Plan. A LegislativeCompliance Index, Appendix A, provides a complete cross‐index of regulatory/legislativerequirementsandthespecificsectionsofthisplanthataddresseachrequirementidentified.

2.1. RenewableEnergyResourceProcurementPriortoPublicAct99‐0906PublicAct99‐0906didnotintroduceaRenewablePortfolioStandardintoIllinoislaw,andthisPlanis not the first Plan that the Agency has produced addressing renewable energy resourcesprocurement. Instead, theAgencyhasbeenproducingprocurementplansaddressing renewableenergyresourceprocurementssince2008andconductingrenewableenergyresourceprocurementssince2009,anditishelpfultounderstandthebackgroundoftheIllinoisRPS’soriginalstructureandsubsequent challenges inunderstanding thechangesmade throughP.A.99‐0906and thechoicesmadeinthisPlan.

PriortoP.A.99‐0906,theIllinoisRPSeffectivelyhadthreecompliancemechanismsdependingonacustomer’ssupplysource:eligibleretailcustomerprocurements,AlternativeRetailElectricSupplier(“ARES”)compliance,andhourlypricingcustomercompliancepayments.

2.1.1. OriginalRPS—EligibleRetailCustomerLoadOfthethreeformerRPScompliancemechanisms,thecompliancepathwaythatlookedmostliketherevisedRPSenactedthroughP.A.99‐0906wasthatwhichappliedto“eligibleretailcustomers,”orthosecustomersstill takingdefault supplyservice fromtheirelectricutility (ComEdandAmerenIllinois,andstarting in2015,MidAmerican). TheAgency’sannualprocurementplans(developedprimarily to propose procurements intended to meet the energy, capacity, and other standardwholesale product requirements of eligible retail customers) also were required to includeprocurement proposals intended tomeet annually‐climbing, percentage‐based renewable energyresourcetargets.AswithblockenergyprocuredbytheAgency,theapplicableutilitywouldbethecounterpartytoanyresultingcontracts.

Sub‐targets were also introduced to the overall procurement volumes: of the renewable energyresourcesprocured,75%wererequiredtocomefromwind,6%fromphotovoltaics,and1%fromdistributed generation. Prior to June 1, 2011, resources from Illinoiswere expressly prioritized(lookingnexttoadjoiningstatesifnonewasavailable,andthentoelsewhere);afterJune1,2011,theRPSrequiredlookingtoIllinoisandadjoiningstatestogetherasafirstpriority,andthentoelsewhere.FundsavailableforuseunderRPScontractsweresubjecttoarateimpactcap—afixedbillimpactcappercentage(2.015%of2007rates),whichwasthenappliedtoeligibleretailcustomerloadtoproducearenewableresourcesprocurementbudget.

ThissystemmayhaveworkedmoreeffectivelyhadIllinoisnotexperiencedsignificantvolatilityinthesizeofitseligibleretailcustomerload.Butitdid,primarilyforthefollowingreason:upontheestablishmentoftheIPAin2007,theGeneralAssemblyrequiredthattheelectricutilitiesenterintorelativelylong‐termenergysupplycontracts(knownasthe“swapcontracts”)toserveeligibleretailcustomerload.Butintheyearsthatfollowed,energypricesplummetedinthewholesalemarket,andtheseagreementsservedtoinflatethedefaultsupplyratewellabovethatwhichcouldbeofferedbyacompetitivesupplier.From2011to2013,massivewavesofdefaultsupplycustomersswitchedto


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ARES, often through opt‐outmunicipal aggregation (municipalities, whether individually or in acoalitionwithothers,leveragingeconomiesofscaletonegotiatefavorableelectricsupplyratesfortheir residents, under authority of Section 1‐92 of the Act), and eligible retail customer loaddwindled—withtheannualavailablerenewableresourcesbudgetdecliningcorrespondingly.

Aspartofits2009AnnualProcurementPlan,theAgencyproposed,andtheCommissionapproved,aprocurementfor“bundled”(energyandREC)long‐termcontractsfromrenewableenergysuppliers.Thesecontractswereexecutedthrougha2010procurementevent,withwinningsuppliersreceiving20yearbundledcontractstohelpmeetfutureyears’targetsintheRPS.WhilethishelpedfacilitatesignificantnewrenewableenergydevelopmentinIllinois(especiallyintheformofwindprojects),italsoprovidedafloorofannualpaymentobligationsundertherenewableresourcesbudgetforfutureyears.

Astheannualrenewableresourcesbudgetdeclinedduetocustomerswitching,notonlywasfundingunavailabletoconductadditionalrenewableenergyresourceprocurements,fundingwasnolongeravailabletomeetthefullcommitmentsintheLong‐TermPowerPurchaseAgreements(“LTPPAs”)describedabove—resultingintwoyearsinwhichComEd’sLTPPAswerecurtailed,orpaymentnotmadethroughtherenewableresourcesbudgetforthefullexpectedoutput.Andwhilesomeloadhasswitchedbacktodefaultsupplyserviceinrecentyears,futurebudgetuncertaintymadeenteringintoanyadditional long‐termagreementsunworkable (especially if suchcontractswere junior to theexisting2010LTPPAs).Asaresult,outsideofdistributedgeneration(“DG”)procurements(whichwerestatutorilyrequiredtobeatleast5yearcontracts)theAgency’sannualprocurementplansafterthe 2010 LTPPAs proposed only the procurement of one‐year contracts tomeet each upcomingdeliveryyear’srenewableenergyresourceobligations—astheAgencysimplydidnotandcouldnothavevisibilityintobudgetsavailableinfutureyears.

2.1.2. OriginalRPS—HourlyPricingCustomersForhourlypricingcustomers,Section1‐75(c)(5)oftheActrequiredthattheapplicableelectricutilityapply“thelesserofthemaximumalternativecompliancepaymentrateorthemostrecentestimatedalternative compliance payment rate for its service territory for the corresponding complianceperiod” tohourlypricingcustomers. Those fundswereheldby theelectricutility—andthusnotsubjecttothetransfer,sweep,andappropriationrisksfacingspecialstatefunds—andsubjecttotheAgency’sannualprocurementplanningprocess.

Inrecentyears,becausecontractswithdistributedgenerationsystemsrequiredcontractsofatleast5years,theIPAusedthesehourlyAlternativeCompliancePayments(“ACPs”)toserveasthefundingsourceforDGprocurements,includingitsmostrecentDGprocurementsapprovedintheIPA’s2017AnnualProcurementPlan.3

2.1.3. OriginalRPS—ARESComplianceLastly,adoptedin2009,theARESRPScompliancemechanismwasmorecomplex.UnderSection16‐115DofthePublicUtilitiesAct,eachAREScarriedapercentage‐basedrenewableportfoliostandardrequirementsimilartotheSection1‐75(c)requirementasapercentageofitssales,butcouldsatisfyitsobligationbymakingalternativecompliancepaymentsataratereflectingthatratepaidbyeligible

3TheAgencyunderstandsthatanyremainingACPfundswillberolledintotheavailableRPSbudgetforplanningpurposes,butasfundsarealreadycollected,wouldnotcountagainsttherateimpactcap.


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retailcustomersfornolessthan50%ofitsobligation,andcouldself‐procureRECsfortheremainder(with a requirement that any RECs be produced by facilities within the regional transmissionterritoriesofPJMInterconnection,L.L.C.(“PJM”)andMidcontinentIndependentSystemOperator,Inc.(“MISO”),arelativelybroadgeographicfootprint).

WithAREScompetingwithoneanother forcustomers(and, forresidentialandsmallcommercialcustomers,alsoagainstdefaultsupplyservice),thisparadigmcreatedanincentiveforanAREStocomplyatthelowestcostpossible.4Thus,alternativecompliancepaymentsweregenerallymadeforthe minimum 50% amount (as the rate applicable to those ACPs reflected more expensiveprocurementsmadebytheAgencytoserveotherends,suchasthroughthe2010LTPPAs),andtheself‐procurement obligation was simply not structured in a way that was likely to lead to thedevelopmentofnewrenewableenergygenerationinIllinois.

Alternative compliance payments were deposited into the IPA‐administered Renewable EnergyResourcesFund.Leveragingthisfundforprocurementscarriedsignificantchallenges.AstheIPAexplained in its SupplementalPhotovoltaicProcurementPlan (released in2014and approved in2015):5

TheprocurementofrenewableenergyresourcesusingtheRERFissubjecttoasetofuniqueconstraints.First,unlikewiththeutilityrenewableresourcesbudgets,theRERFmayonlybeused toprocure renewable energy credits. While the term “renewableenergyresources”isdefinedintheIllinoisPowerAgencyActasRECsorbothrenewableenergy and associated RECs,6 the Public Utilities Actmakes clear that “alternativecompliancepayments . . . shallbedeposited in the IllinoisPowerAgencyRenewableEnergyResourcesFundandusedtoprocurerenewableenergycredits.”7

Second,Section1‐56(c)of the IPAAct callson the IPA touse theRERF to “procurerenewableenergyresourcesatleastonceeachyearinconjunctionwithaprocurementeventforelectricutilitiesrequiredtocomplywithSection1‐75oftheAct.”8GiventheIPA’sstrategyofadvancepurchasestohedgeloadrequirementsandtheunexpectedlyhigh levelsofmigration toalternativeretailelectricsuppliers,correspondingenergyprocurementeventsforelectricutilitieshadnotoccurredsince2012.9ThishaslefttheAgencywithoutaprocurementevent“inconjunctionwith”whichitcouldprocureRECsusingtheRERF.

Third,Section1‐56(d)oftheIPAActrequiresthat“thepricepaidtoprocurerenewableenergycredits”using theRERF“shallnotexceedthewinningbidpricespaid for likeresourcesprocured forelectricutilities required to complywithSection1‐75of thisAct.”10ThelackofaconjoiningprocurementeventhasalsolefttheAgencywithouta

4Totheextentthatacustomersoughtamoreenvironmentallyfriendlyproduct,theAREScouldalwaysoffera“green”productincluding100%ofmegawatt‐hoursmatchedwithrenewableenergycredits,disconnectedfromanyRPScomplianceobligation.5ThecharacterizationsofstatelawinthisexcerptrefertotherequirementsoftheIllinoisPowerAgencyActpriortoPublicAct99‐0906.620ILCS3855/1‐10.7220ILCS5/16‐115D(d)(4).820ILCS3855/1‐56(c).9Afternothavingprocuredenergyin2013,theAgencydidconductenergyprocurementsinApril2014andSeptember2014.1020ILCS3855/1‐56(d).


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statutorily envisioned price ceiling for “like resources,” further constrainingprocurementusingtheRERF.

Fourth,theIPAActclearlyarticulatesapreferenceforlonger‐termcontractsusingtheRERF, presumably to provide a stable stream of revenue necessary to incent thedevelopmentofnewresources. Section1‐56(c)oftheIPAActcallsfortheAgencyto,“wheneverpossible,enterintolong‐termcontractsonanannualbasisforaportionoftheincrementalrequirementforthegivenprocurementyear.”11 Similarly,Section1‐56(b)oftheActrequiresthatanycontractsforresourcesfromdistributedgeneration(“DG”)must run aminimum of 5 years.12 But due to unsettled and dynamic loadmigrationbetweenutilityandalternativesupplierservice,theAgencymustapproachlong‐termcontractingwithprudenceandcare,astheRERF’sfuturebalanceissubjecttothewhimsoffuturecustomerswitching.13

Inadditiontotheaboverisks,asaspecialstatefund,theRERFcouldalwaysbe—andindeedwas—subjecttotherisksofborrowingandtransfers.In2010,$6.7millionwastransferredoutoftheRERF,althoughultimatelyrepaidbackintoit.In2015,$98millionwaspermanentlytransferredfromtheRERF to the state’s General Revenue Fund (“GRF”) tomake up for insufficient Fiscal Year 2015generalrevenues.AndinAugust2017,$150millionwastemporarilytransferredfromtheRERFtotheGRF(after$12millionwaspermanentlytransferredfromtheRERFtothestate’sPublicUtilitiesFundinJune2017),leavingtheRERF’sbalancebelowthelevelneededtocoverexistingcontractualobligations.14Giventheserisks,andgivenrecentperiodsinwhichthestatefailedtoenactabudget(andthustheIPAlackedappropriationauthoritytomakepaymentsundercontractsregardlessofactualfundsavailable),theStateofIllinoiscouldbeanunattractivecounterpartyforaRECdeliverycontract.

WiththemajorityofIllinoiselectricloadbeingservedbyARES,thisstoodasnosmallproblem—while the RPS covered the vastmajority of electricity delivered in the state, littlewas producedthrough it. Significant amountswere being paid into the RERF each year to support renewableenergydevelopment,yetthemoneywasunabletobeeffectivelyleveragedforthatpurpose.WhileARESwereprocuring,inaggregate,millionsofRECseachyear,theincentivestructurefacingthosesuppliersmadeithighlyunlikelythatthoseRECswouldbesourcedfromanythingotherthanthelowest‐pricedseller:generally,facilitiesalreadybuiltandfinanced,andpotentiallyfromprojectsinvertically integratedstateswithcostsalreadybeingfullyrecoveredthroughrates. Hence,partiesseekingchangestothissystemoftencharacterizeditasa“brokenRPS,”15andonethatwouldrequireacomprehensivelegislativeoverhaultobeproperlyfixed.

1120ILCS3855/1‐56(c).1220ILCS3855/1‐56(b).13 For further discussion of the challenges associated with entering into long‐term contracts using funding streams subject to loadmigrationchanges,seefilingsmadeinCommissiondocketsapprovingtheIPA’s2013and2014annualprocurementplans(DocketNos.12‐0544and13‐0546).14Thetransferof$150millionwaspursuanttonewlyenactedSection5h.5oftheStateFinanceAct(30ILCS105/5h.5containedinPublicAct100‐0023)thatauthorizestransfersfromspecialfundstotheGeneralRevenueFund.However,thatSectionalsocontainsaprovisionthatfundswillberepaidwithin24months,aswellasaprovisiontotransferfundsbacktospecialfundsasneededto“satisfyoutstandingexpenditureobligationsonatimelybasis.”15OnenotablesuccessstoryfromtheRERFwastheSupplementalPhotovoltaicProcurementprocess,whichresultedinthedevelopmentofroughly30MWofnewdistributedgenerationphotovoltaicsinIllinoisthroughfive‐yearRECcontractsusingtheRERF.Buteventhisprocessrequiredlegislativechangestobeeffectuated,withtheAgency’sauthoritytodevelopitsSupplementalPhotovoltaicProcurementPlancomingfromPublicAct98‐0672(signedintolawin2014),whichcreatednewSection1‐56(i)oftheIPAAct.


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2.2. PublicAct99‐0906TheAgency’sobligationtodevelopaLong‐TermRenewableResourcesProcurementPlanstemsfromnewrequirements includedinPublicAct99‐0906,knowncolloquiallyas the“FutureEnergy JobsAct”andreferredtohereinasP.A.99‐0906.P.A.99‐0906,thenknownasSenateBill2814,waspassedbyboththeIllinoisHouseandSenateduringthelastdaysofthe99thGeneralAssemblyonDecember1,2016,andwassignedintolawbyIllinoisGovernorBruceRauneronDecember7,2016withaneffectivedateofJune1,2017.

In addition to the requirement that the Agency develop this Long‐Term Renewable ResourcesProcurementPlanand implement theprogramsandprocurementdiscussedherein,P.A.99‐0906alsocontainedanumberofothersignificantreformstoIllinoisenergylaw.Amongthosereformsinclude the establishment of a zero emission standard requiring the Agency to develop a ZeroEmission Standard Procurement Plan for the procurement of zero emission credits from zeroemission (i.e., nuclear) generating facilities;16 revisions to the state’s energy efficiency portfoliostandard found in Article VIII of the Public Utilities Act (220 ILCS 5) including the adoption ofcumulativesavingstargetsforenergyefficiencyprogramsandmeasures,andtheeliminationofthestatutory pathway bywhich incremental energy efficiency programswere included in the IPA’sannual procurement plans;17 additional financial assistance for low‐income ratepayers;18 billcrediting for the energy production associated with subscriptions to community renewablegeneration;19andasmartinverterrebateforbehind‐the‐metergeneratingfacilities.20

MorepertinentlyforpurposesofthisPlan,P.A.99‐0906constitutedacomprehensiveoverhaulofthestate’srenewableenergyportfoliostandard,elementsofwhichcanbefoundinSections1‐56and1‐75(c)oftheIPAActandSection16‐115DofthePUA.UnderthepriorIllinoisRPS,complianceandplanning depended on how a customer’s supply requirements were met, with three separatecompliancemechanismsforloadservicebydefaultutilitysupplyservice,hourly‐pricingcustomers,andloadservedbyAlternativeRetailElectricSuppliers.Asdiscussedfurtherbelow,changestotheIllinoisRPSthroughP.A.99‐0906willtransitionthestate’sRPStoastreamlined,centralizedplanningandprocurementprocess,withbothRPStargetsandavailablebudgetsdeterminedonthebasisofanelectric utility’s load for all retail customers21with funding collected through a delivery servicescharge.OutsideoftheInitialForwardProcurements(discussedfurtherbelow)andtworemainingyears22ofAREScompliancerequirements, thestate’sapproach tomeeting itsRPS targetswillbeaddressed through the development and continued refinement of this Long‐Term RenewableResources Procurement Plan,with the Plan proposing programs and procurements necessary to

16TheAgency’sZeroEmissionStandardProcurementPlan,developedpursuanttonewSection1‐75(d‐5)oftheAct,wasfiledwiththeCommissiononJuly31,2017andwasapprovedbytheCommissiononSeptember11,2017.SeeICCDocketNo.17‐0333.17See220ILCS5/16‐111.5B.18See220ILCS5/8‐103B(c)(requiringComEdandAmerenIllinoistoallocate$25millionand$8.5million,respectively,annuallyforlow‐incomeenergyefficiencyprograms);305ILCS20/18(c)(5),(5.5),(7)(authorizingPercentageofIncomePaymentPlan(“PIPP”)qualifiedcustomers to receive credits under a utility’s Arrearage Reduction Program, and creating a new Supplemental Arrearage ReductionProgramforutilitycustomerswhocannotjointhePIPPduetotimingorfundingconstraints);220ILCS5/16‐108.10(creatingnew$10millionannualfundingstreamoverfiveyearsforlow‐incomeassistanceprogramsforComEdcustomers).19See220ILCS5/16‐107.5(l).20See220ILCS5/16‐107.6.21ForMidAmerican,consistentwiththeCommission’sOrderinDocketNo.15‐0541,theIPAunderstandsthatSection1‐75(c)’srenewableenergyprocurementtargetsshould“onlyrelatetothatportionofthe‘totalsupply’procuredforMidAmerican’sjurisdictionaleligibleretailcustomers,”andnotallretailsalesinitsserviceterritory.22Thisincludesthecurrent2017‐2018deliveryyear.


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meetthenewrequirementsofIllinoislawandsatisfyingthelaw’snewemphasisonbothusingtheRPSasatooltofacilitatethedevelopmentofnewgeneratingfacilitiesandexpandingaccesstothebenefitsofrenewableenergyacrossabroadercross‐sectionofthestate’seconomy.

2.2.1. LegislativeFindingsThis new emphasis is reflected in the legislative findings associated with Public Act 99‐0906.Specifically,inenactingP.A.99‐0906,theGeneralAssemblyfoundthat“[t]oensurethattheStateanditscitizens,includinglow‐incomecitizens,areequippedtoenjoytheopportunitiesandbenefitsofthesmartgridandevolvingcleanenergymarketplace,”P.A.99‐0906shouldserveto“maximizetheimpact”ofthestate’sRPS.23ThisincludesdirectionthattheStateshould“encourage...theadoptionand deployment of cost‐effective distributed energy resource technologies and devices, such asphotovoltaics,which canencourageprivate investment in renewable energy resources, stimulateeconomicgrowth,enhancethecontinueddiversificationofIllinois'energyresourcemix,andprotecttheIllinoisenvironment; investment inrenewableenergyresources, including,butnot limitedto,photovoltaic distributed generation,which should benefit all citizens of the State, including low‐incomehouseholds.”24

ThesethemesarealsofoundinthenewlegislativefindingsanddeclarationsoftheIPAActenactedthroughP.A.99‐0906.TheIPAActnowfindsanddeclaresthat”[d]evelopingnewrenewableenergyresourcesinIllinois,includingbrownfieldsolarprojectsandcommunitysolarprojects,willhelptodiversifyIllinoiselectricitysupply,avoidandreducepollution,reducepeakdemand,andenhancepublic health and well‐being of Illinois residents.”25 Other findings also reinforce the value ofcommunitysolarinexpandingaccesstorenewableenergy,26andthevalueofdevelopingbrownfieldsitesolarprojectsto“helpreturnblightedorcontaminatedlandtoproductiveusewhileenhancingpublichealthandthewell‐beingofIllinoisresidents.”27

Thisapproachtothestate’sRPSappearstoconstituteameaningfulshiftinthelogicgoverningthestate’srenewableenergyrequirements:inpastyears,thestate’sapproachtoitsRPScouldhavebeenunderstoodasgovernedbythelogicthatstatutorycomplianceshouldbeachievedat“thelowesttotalcostover time, taking into account anybenefitsofprice stability,”28 as this criteria governed theAgency’s annual procurement plan, in which renewable energy procurements were proposed.Through changes effected by P.A. 99‐0906, it is apparent that the General Assembly also seeksoutcomesofspecifictypes—moreequitableanddiverseaccesstothebenefitsofrenewableenergy,and an emphasis on facilitating the development of new generation and maximizing itsenvironmentalbenefits—inachievingcompliancewiththetechnicalrequirementsofthelaw.

GuidancefoundintheRPSlawitselfalsoreflectsthatapproach.Specifically,Section1‐75(c)(1)(I)oftheIPAActrequiresthattheIPA“shalldesignitslong‐termrenewableenergyprocurementplantomaximize the State's interest in the health, safety, andwelfareof its residents, including butnot

23P.A.99‐0906,§1(a).24 P.A. 99‐0906,§ 1(a)(1). In the legislative findings of P.A. 99‐0906, theGeneral Assembly also specifically found that “low‐incomecustomersshouldbeincludedwithintheState'seffortstoexpandtheuseofdistributedgenerationtechnologiesanddevices.”P.A.99‐0906,§1(b).2520ILCS3855/1‐5(6).2620ILCS3855/1‐5(7).2720ILCS3855/1‐5(8).28See220ILCS5/16‐111.5(d)(4).


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limited tominimizing sulfur dioxide, nitrogen oxide, particulatematter and other pollution thatadversely affects public health in this State, increasing fuel and resource diversity in this State,enhancingthereliabilityandresiliencyoftheelectricitydistributionsysteminthisState,meetinggoalstolimitcarbondioxideemissionsunderfederalorStatelaw,andcontributingtoacleanerandhealthierenvironmentforthecitizensofthisState.”TheAgencybelievesitsLong‐TermRenewableResourcesProcurementPlanreflectstheseaspirations.

2.2.2. ChangestotheRPSTobettermeettheseobjectives,severalchangesweremadetotheRPS,includingtheintroductionofnewconceptsand terms, andnewprescriptive requirements. Severalof thesenewconceptsarediscussedbelow,discussedfurtherinthesubsectionslaterinthischapter,andinmoredetailintheChaptersthatfollow.

2.2.3. NewConceptsandTermsFirst, as discussed further below, P.A. 99‐0906 demonstrates a shift in compliance focus fromcompliancethroughtheprocurementof“renewableenergyresources”—whichmaybeeither1)arenewableenergycreditassociatedwithamegawatt‐hour(“MWh”)ofgeneration,or2)thatRECplusthe associated generation—to compliance through the purchase and retirement of “renewableenergycredits.”29Thismakesintuitivesense;thepurchaseofenergyisnotaddressedthroughthisplan, and the Agency’s planning for any energy purchases can only be for utility default supplycustomers(the“eligibleretailcustomers”)andishandledthroughthedevelopmentofaseparateprocurementplan(whichfocusesonashortertimeframethanmanyoftheRECcontractsenvisionedintherevisedRPS).

Second,P.A.99‐0906introducedtheconceptofa“communityrenewablegenerationproject”totheIllinoislaw.AsdefinedbytheIPAAct,30thisisanelectricgeneratingfacilitythat

(1)ispoweredbywind,solarthermalenergy,photovoltaiccellsorpanels,biodiesel,cropsanduntreatedandunadulteratedorganicwastebiomass,treewaste,andhydropowerthatdoesnotinvolvenewconstructionorsignificantexpansionofhydropowerdams;

(2)isinterconnectedatthedistributionsystemlevelofanelectricutilityasdefinedinthisSection, a municipal utility as defined in this Section that owns or operates electricdistributionfacilities,apublicutilityasdefinedinSection3‐105ofthePublicUtilitiesAct,oranelectriccooperative,asdefinedinSection3‐119ofthePublicUtilitiesAct;

(3)creditsthevalueofelectricitygeneratedbythefacilitytothesubscribersofthefacility;and

(4)islimitedinnameplatecapacitytolessthanorequalto2,000kilowatts.

Asubscriber’ssubscriptiontosuchafacilityisan“interest”inthatfacility,“expressedinkilowatts”andsizedprimarilytooffsetpartorallofthesubscriber'selectricityusage,andmaynotconstitutemorethan40%ofthefacility’snameplatecapacity.31Photovoltaicpoweredcommunityrenewable

29See,e.g.,20ILCS3855/1‐75(c)(1)(B),(C).Thelawappearstorecognizethat“renewableenergyresources”maybeusedtosatisfytheRPS,butappearstofocusthisplanonlyontheprocurementof“renewableenergycredits.”30See20ILCS3855/1‐10.31Id.


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generating projects are frequently described herein as “community solar” projects, and featuredistinctprocurementtargetsintheIllinoisRPS.

Third,P.A.99‐0906requiresthedevelopmentofan“adjustableblockprogram.”Usedtofacilitatethedevelopmentofnewcommunitysolaranddistributedphotovoltaicgeneration,theAdjustableBlockProgram featuresa “transparentscheduleofpricesandquantities” forRECs“toenable thephotovoltaicmarkettoscaleupandforrenewableenergycreditpricestoadjustatapredictablerateover time.”32 This represents a significant shift in the state’s approach to procuring renewableenergy;pasteffortstoprocurerenewableenergyresourcesfocusedoncompetitivesealedbidding,pay‐as‐bidprocurementevents.Mostbidderandsupplierinformation,includingresultingcontractprices and quantities for winning bidders, was kept confidential. While these competitiveprocurementelementsarerequiredforcertainactivitiesundertheIllinoisRPS(includinginitialandsubsequentforwardprocurements),othercompliancepathwaysnowfeatureopenapplicationtoaprogramfeaturingpriceandquantitytransparency.

Fourth,forboththeIllinoisSolarforAllProgramandtheAdjustableBlockProgram,P.A.99‐0906contemplates “prepayment” for a stream of RECs to be delivered over the course of a 15‐yearcontract. This likewise constitutes adeparture fromprioractivitiesunder the IllinoisRPS, allofwhichfeaturedpaymentforRECsonlyupondeliveryandinvoice.ThespecificprepaymentschedulesapplicabletoprojecttypesundertheAdjustableBlockProgramarediscussedfurtherinSection2.5below.

This,ofcourse,isnotacomprehensivelist;manyothernewtermsandconceptswereintroducedthroughP.A.99‐0906,andtheabovelistisnotevenamajorityoftheitems.Thisnon‐exhaustivelistisinsteadintendedonlytoprovidebackgroundforthediscussionsthatfollow.

2.2.4. Long‐TermRenewableResourcesProcurementPlanAsreferencedabove,P.A.99‐0906requirestheIPAtodevelopaLong‐TermRenewableResourcesProcurementPlan.ThisisadeparturefrompastpracticeundertheIllinoisRPS;previously,Illinoislaw required that renewable energy resource procurements used to meet the requirements ofSection1‐75(c)oftheIPAActbeproposedthroughtheAgency’sannualprocurementplan.Thoseplansweredeveloped,published,filedwiththeICC,andapprovedbytheICConanannualbasis(andstillare,withamorelimitedfocus)withaplanninghorizonofthefiveupcomingdeliveryyears.Bycontrast,theLong‐TermRenewableResourcesProcurementPlanisinitiallypreparedonce,revisedat leastevery twoyears,and“shall includeprocurementprogramsandcompetitiveprocurementeventsnecessary tomeet thegoals”33set forth inSection1‐75(c)of the IPAAct—whichcontainsannualtargetsoutuntil2030.AsexplainedintheChaptersthatfollow,asbudgetavailabilityandpossibleprogramsuccessesorfailuresmakesplanningfarintothefutureunwiseorunworkable,insomecasestheAgencyproposesthatcertaindecisionsbedeferreduntilfutureyears’revisionsoftheLong‐TermRenewableResourcesProcurementPlan.

2.2.5. PlanRequirementsWhileIllinoislawlacksanysinglelistofrequiredelementsforthePlan,bothSection16‐111.5(b)ofthePUAandSections1‐56(b)and1‐75(c)oftheIPAActdocontaindiscreterequirements.

3220ILCS3855/1‐75(c)(1)(K).3320ILCS3855/1‐75(c)(1)(A).


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2.2.5.1. Section16‐111.5(b)Requirements

Section16‐111.5(b)(5)ofthePUAprovidesthat“[t]heAgencyshallpreparealong‐termrenewableresourcesprocurementplanfortheprocurementofrenewableenergycreditsunderSections1‐56and1‐75oftheIllinoisPowerAgencyActfordeliverybeginninginthe2017deliveryyear,”34with“deliveryyear”definedas“theconsecutive12‐monthperiodbeginningJune1ofagivenyearandendingMay31ofthefollowingyear”35—i.e.,thefirstdeliveryyearforwhichthePlanisdevelopedwouldbe2017‐2018.Asaconsequence,theIPAbelievesthatalthoughitsPlanmaynotbeapprovedbytheCommissionuntillateMarchorearlyAprilof2018,thisPlanshouldproposeprocurementsnecessarytomeet“2017deliveryyear”targets,aswellastargetsforfuturedeliveryyears.FurtherdiscussionofthoseproposedprocurementscanbefoundinChapter5.

ThePUAcontainsthreediscreterequirementsforwhatthePlanmustcontain:

First, the Planmust “[i]dentify the procurement programs and competitive procurement eventsconsistentwiththeapplicablerequirementsoftheIllinoisPowerAgencyActandshallbedesignedto achieve the goals set forth in subsection (c) of Section 1‐75 of that Act.”36 While the term“competitive procurement event” is not specifically defined in the IPA Act or the PUA, the IPAunderstandstheterm“competitiveprocurementevent”tobeanelementof, ifnotcommensuratewith,a“competitiveprocurementprocess”or“competitivebidprocess,”whichthePUAdescribessubjecttotherequirementsofSection16‐111.5(e)‐(i)whereapplicable(i.e.,conductedinamannerconsistentwiththeAgency’spriorcompetitiveprocurements).37Theterm“program”presumablyreferstotheprogramsspecificallyreferencedinSection1‐56(b)andSection1‐75(c)(1)(K)and(N)oftheIPAAct.

InthisPlan,thespecificprocurementprogramsandprocurementeventsdesignedtomeetthegoalsofSection1‐75(c)canbefoundinChapters5through8.

Second, thePlanmust “[i]ncludea schedule forprocurements for renewableenergycredits fromutility‐scale wind projects, utility‐scale solar projects, and brownfield site photovoltaic projectsconsistentwithsubparagraph(G)ofparagraph(1)ofsubsection(c)ofSection1‐75oftheIllinoisPower Agency Act.”38 As explained further below, this subparagraph concerns the quantitativeprocurementtargetsforRECsfromnewsolarandwindfacilitiesfoundinSection1‐75(c),andthescheduleforthoseprocurementscanbefoundinChapter5.

Third,thePlanmust“[i]dentifytheprocesswherebytheAgencywillsubmittotheCommissionforreviewandapprovaltheproposedcontractstoimplementtheprogramsrequiredbysuchplan.”39Inthe past, under Section 16‐111.5(e), the IPA’s procurement administrator developed standardcontractformsinconsultationwithotherparties.ACommissiondecisionwasrequiredonlyifpartiescouldnotagreeonthecontractform,andthestandardformcontractwasrequiredtobeexecutedbywinning bidders after a competitive procurement result (the results of which were subject to

34220ILCS5/16‐111.5(b)(5).3520ILCS3855/1‐10.36220ILCS5/16‐111.5(b)(5)(ii)(B)(aa).37220ILCS5/16‐111.5(b)(5)(iii).38220ILCS5/16‐111.5(b)(5)(ii)(B)(bb).39220ILCS5/16‐111.5(b)(5)(ii)(B)(cc)


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Commissionapproval).Underthisrevisedmodelforuseinimplementingprograms,itappearsthatbothRECdeliverycontractsandtheIPA’sprogramadministratorcontracts40mustfirstbeapprovedbytheCommissionpriortoexecution.TheIPA’sproposalfortheprocessforsubmittingcontractstothe Commission for review and approval can be found in Chapters 6 and 8 of the Plan. As thisrequirementconcernsonly“theprogramsrequiredbysuchplan,”thisrequirementdoesnotimpactthecontractdevelopmentprocessforthecompetitiveprocurementsdescribedinChapter5.

2.2.5.2. Section1‐75(c)Requirements

Section1‐75(c)oftheIPAActcontainsthemostrobustsetofrequirementsforthelong‐termplan;thoseincludethefollowing:

First,thePlanmust“includethegoalsforprocurementofrenewableenergycreditstomeetatleastthefollowingoverallpercentages:13%bythe2017deliveryyear;increasingbyatleast1.5%eachdeliveryyearthereaftertoatleast25%bythe2025deliveryyear;andcontinuingatnolessthan25% for each delivery year thereafter.”41 As explained further below, these percentages aredescribedasaportionofeligibleretailsales,whichcurrentlyincludessomesalesbyalternativeretailelectricsupplierswhile transitioning toall retail saleswithin twoyears. The lawalsocontainsarequirement that “in the event of a conflict between these goals and the new wind and newphotovoltaic procurement requirements,” the long‐term plan shall prioritize the new wind andphotovoltaicrequirements.42TheIPAdoesnotanticipateanysuchconflictpriortoitsnextrevisionofthisPlan,andhasdesigneditsPlaninamannerthatreducesthelikelihoodofanysuchconflictoccurring(forinstance,throughusingshort‐termcontractstomeetpercentage‐baseddeliveryyeargoalsafternewbuildisaccountedfor).FurtherdiscussionofthesegoalscanbefoundinChapter3.

Second,thePlan“shallincludetheprocurementofrenewableenergycreditsinamountsequaltoatleast” thenewwindandnewphotovoltaics targets found inSection1‐75(c)(1)(C)of the IPAAct.Thesetargetsare2millionRECsfrom“newwindprojects”bythe2020deliveryyear,3millionby2025, and4millionby2030. “Newphotovoltaicprojects” feature thesameoverallprocurementtargets,whilealsocontainingrequirementsthatatleast50%ofPVRECsbeprocuredthroughtheAdjustableBlockProgram(andthusfromdistributedgenerationorcommunitysolarprojects),atleast40%fromutility‐scale(above2MW)photovoltaicprojects,andatleast2%frombrownfieldsitephotovoltaicprojectsthatarenotcommunityrenewablegenerationprojects.FurtherdiscussionofthesequantitativenewbuildtargetscanbefoundinChapter5.

Third,thelawrequiresthat,totheextentthatannualRPSspendingbudgets43foreachutilitybecomeabindingconstraint,thePlan“shallprioritizecompliancewiththerequirementsofthissubsection(c) regarding renewableenergy credits” in themannerdiscussed inSection1‐75(c)(1)(F),whichfeaturesthefollowingpriorityranking:

40 For the Agency’s third‐party program administrators, Section 16‐111.5(b)(5)(iii) provides that “[t]hird parties shall not beginimplementinganyprogramsorreceiveanypaymentunderthisSectionuntiltheCommissionhasapprovedthecontractorcontractsundertheprocessauthorizedbytheCommissioninitem(D)ofsubparagraph(ii)ofparagraph(5)ofthissubsection(b)andthethirdpartyandtheAgencyorutility,asapplicable,haveexecutedthecontract.”4120ILCS3855/1‐75(c)(1)(B).42Id.43ThestatutorycostcapandresultingbudgetsforRPSspending,directedinSection1‐75(c)(1)(E)oftheAct,arediscussedinmoredetailinSection2.4.4andChapter3ofthisPlan.


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(i)renewableenergycreditsunderexistingcontractualobligations;

(i‐5)fundingfortheIllinoisSolarforAllProgramasdescribedinSection1‐75(c)(1)(O);44

(ii)renewableenergycreditsnecessarytocomplywiththenewwindandnewphotovoltaicprocurementrequirementsinSection1‐75(c)(1)(C);and

(iii)renewableenergycreditsnecessarytomeettheremainingrequirementsofSection1‐75(c)(includingthepercentage‐baseddeliveryyeargoalsinSection1‐75(c)(1)(B)).45

Whileitistooearlyintheplanningprocessforanyonerequirementpotentiallytocannibalizetheother,theIPAiscommittedtoensuringthatthispriorityrankingisreflectedinanyfuturerevisionstothePlanandhasassembledthisPlancognizantofandsensitivetothisprioritization.

Fourth, the law requires that renewable energy credits procured under the Initial ForwardProcurementsshallbeincludedintheAgency'slong‐termplanandshallapplytoSection1‐75(c)’sgoals;46whiletheInitialForwardProcurementforsolarisyettobecompleted,theexpectedresultsof the Initial Forward Procurements are reflected in the Agency’s target procurement quantitiesfoundlaterinChapter3ofthisPlan.

Fifth,thePlanmustsetforththeprocessbywhichadjustmentsmaybemadewhenthecumulativeamountofrenewableenergycreditsprojectedtobedeliveredfromallnewwindprojectsinagivendeliveryyearexceedsthecumulativeamountofrenewableenergycreditsprojectedtobedeliveredfrom all new photovoltaic projects in that delivery year by 200,000 or more renewable energycredits.47Thisprovisionispresumablyintendedtoprovidesomebalancingbetweenwindandsolarquantities, and theAgency’sproposal forhow itwould seek toprocureRECs fromadditionalPVprojectsto“rebalance”canbefoundinChapter5ofthePlan.

Sixth, thePlanmustdescribe indetailhoweach“public interest factor”enumerated inSection1‐75(c)(1)(I)“shallbeconsideredandweightedforfacilitieslocatedinstatesadjacenttoIllinois”indeterminingwhetherthosefacilities’RECsmaybeconsidered“eligible”tosatisfytheIllinoisRPS.This limitation of eligible RECs to Illinois and adjacent states constitutes a departure from pastpracticeundertheRPS,underwhichcompetitiveprocurementsfirstlookedtoRECsfromIllinoisandadjoining states and then to “elsewhere” in attempting to satisfy targets, and may serve tosignificantly limit the pool of renewable energy credits eligible to meet the RPS. The Agency’sproposalforhowtoapplythiscriteriacanbefoundinChapter4.

Seventh,thePlanshallprovidethatrenewableenergycreditspreviouslyallocatedfromgeneratingsystemspreviouslyunderstoodnottoberate‐basedforastate‐regulatedentity,butwhichendupbeing so rate‐based, shall be made up through a procurement conducted in the Agency’s nextprocurementevent. Thisconnectsbacktoanewrequirement in the lawthat“renewableenergycreditsshallnotbeeligibletobecountedtoward”RPStargets“iftheyaresourcedfromageneratingunitwhosecostswerebeingrecoveredthroughratesregulatedbythisStateoranyotherstateorstatesonorafterJanuary1,2017.”48Itappearsthatthiscouldeasilybeaccomplishedthroughan44Thisrequirementisdiscussedfurtherinthesubsectionbelow.4520ILCS3855/1‐75(c)(1)(F).4620ILCS3855/1‐75(c)(1)(G)(i).4720ILCS3855/1‐75(c)(1)(G)(iv).4820ILCS3855/1‐75(c)(1)(J).


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adjustment in procurement volumes for subsequent procurement events, and the IPA commitsthroughthisPlantomakeanysuchadjustments(notdescribedherein,astheyareasyetunknownandunknowable).

Eighth,thePlan“shallincludeanAdjustableBlockprogramfortheprocurementofrenewableenergycreditsfromnewphotovoltaicprojectsthataredistributedrenewableenergygenerationdevicesornew photovoltaic community renewable generation projects.”49 A description of the Agency’sproposedAdjustableBlockProgramcanbefoundinChapter6,anditincludestheAgency’sproposalfortheallocationoftheremaining25%ofRECstobeprocuredthroughthatprogramnotallocatedtospecificDGorcommunitysolarprojecttypes.

Ninth,andlastamongtherequirementsfoundinSection1‐75(c),thePlan“shallincludeacommunityrenewablegenerationprogram,”witharequirementthattheAgency“establishtheterms,conditions,and program requirements for community renewable generation projectswith a goal to expandrenewable energy generating facility access to a broader group of energy consumers, to ensurerobustparticipationopportunitiesforresidentialandsmallcommercialcustomersandthosewhocannotinstallrenewableenergyontheirownproperties”andthatanysubscriptionstosuchprojects“beportableandtransferable.”50Presumably,althoughcommunitysolarphotovoltaicisasubsetof“community renewable generationprojects”—which can include generating technologies such aswind, solar thermal, biodiesel, biomass, tree waste, and hydropower—this means that onlyestablishing an Adjustable Block Program featuring a community solar photovoltaic componentwouldnotsatisfythisstatutoryrequirement,andadistinctnon‐PVcommunityrenewablegenerationprogram must also be established.51 The Agency’s proposed community renewable generationprogram,modeledonbutdistinctfromitsAdjustableBlockProgram,canbefoundinChapter7.

2.2.5.3. IllinoisSolarforAllRequirements

Asdiscussedfurtherbelow,inrecognitionofafindingthat“theStateshouldencourage...investmentin renewableenergy resources, including,butnot limited to,photovoltaicdistributedgeneration,whichshouldbenefitallcitizensoftheState,includinglow‐incomehouseholds,”revisionstoSection1‐56oftheIPAActprovideforthecreationof“theIllinoisSolarforAllProgram,whichshallincludeincentives for low‐income distributed generation and community solar projects [. . .] to bringphotovoltaicstolow‐incomecommunitiesinthisState.”52Insodoing,theAgencymust“includeadescriptionofitsproposedapproachtothedesign,administration,implementationandevaluationoftheIllinoisSolarforAllProgram”inthePlanand“proposetheIllinoisSolarforAllProgramterms,conditions, and requirements,”53 including REC prices (which may be through a formula). ThedescriptionoftheAgency’sproposedIllinoisSolarforAllProgramcanbefoundinChapter8.

4920ILCS3855/1‐75(c)(1)(K).5020ILCS3855/1‐75(c)(1)(N).51Morespecifically,Section1‐75(c)(1)(N)providesthat“[t]heAgencyshallpurchaserenewableenergycreditsfromsubscribedsharesofphotovoltaiccommunityrenewablegenerationprojectsthroughtheAdjustableBlockprogramdescribedinsubparagraph(K)ofthisparagraph(1)orthroughtheIllinoisSolarforAllProgramdescribedinSection1‐56ofthisAct”(emphasisadded).(AstheIPAcannotbethecounterpartytoRECdeliverycontractsunderSection1‐75(c),theAgencyunderstands“purchase”effectivelytomean“procure”inthiscontext.)5220ILCS3855/1‐56(b)(2).5320ILCS3855/1‐56(b)(4).


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InadditiontodescribingwhattheIllinoisSolarforAllProgramisandhowitwillbeadministered,the law also requires that should the IPA hire a third‐party program administrator (oradministrators)toassistwiththeadministrationoftheIllinoisSolarforAllProgram,thePlanshallidentifyatwhatintervalitmustreporttotheAgencyandtheCommission(providedthatintervalisatleastquarterly).ThePlanshallalsoprovideforanindependentevaluationoftheprogram,andmustcontainadefinitionoftheterm“environmentaljustice”community.TheseissuesarelikewiseaddressedinChapter8.

ThePlanmustalsoensurethattheIllinoisSolarforAllprogramisfunded.Specifically,Section1‐75(c)(1)(O)oftheActprovidesthatthePlan“shallallocate5%ofthefundsavailableundertheplanfortheapplicabledeliveryyear,or$10,000,000perdeliveryyear,whicheverisgreater,tofundtheprograms.” This raises the question ofwhat ismeant by the phrase “funds available under theplan”—onlythoseutility‐collectedfundsavailablethroughSection1‐75(c),orallfundsinclusiveofanyfundsavailablefromtheRenewableEnergyResourcesFundbalance?Intheformerreading,theAgencywouldretaindiscretiontoallocateseparatelyfundsfromtheRERF,butinthelatterreading,the Agency could not do so. The IPA believes this could not have been the drafters’ intent; forinstance,inayearinwhichtheRERFbalanceremainedhighbuttheutility‐collectedbudgetunderSection1‐75(c)(1)(E)waslargelycommitted(i.e.,unavailable),theAgencywouldbeconstrainedtousing only $10million to support Illinois Solar for All, despite having significantlymoremoneyavailableandregardlessofwhateversuccesstheSolarforAllprogramshadbeenexperiencing.Thus,the IPAbelieves that the intentionof this language inSection1‐75(c)(1)(O) is that5%ofutility‐collectedfunds,or$10million,whicheverisgreater,wouldbemadeavailableannuallyforIllinoisSolarforAll—inadditiontowhatevermaybespentinagivenyearthroughtheRERF.

Notwithstandingthelanguagediscussedintheparagraphabove,thelawalsorequiresthatforeachofthreeparticulardeliveryyears—“thedeliveryyearsbeginningJune1,2017,June1,2021,andJune1, 2025”—the Plan “shall allocate 10% of the funds available under the plan for the applicabledeliveryyear,or$20,000,000perdeliveryyear,whicheverisgreater,”and$10,000,000ofsuchfundsshallbeusedbyComEdtoimplementitsCommission‐approvedworkforcedevelopmentplanfiledunderSection16‐108.12of thePUA.54 If additional funding for Illinois Solar forAll programs isavailableunderSection16‐108(k)55ofthePUA,thenthePlan“shallprovidefortheAgencytoprocurecontractsinanamountthatdoesnotexceedthefunding,”withtheapplicableutilityorutilitiesasthecounterpartytosuchcontracts.56

2.2.6. ItemsNotIncludedinLong‐TermRenewableResourceProcurementPlan

While the Plan sets forth the IPA’s proposed approach tomeeting the state’s renewable energyresource procurement targets, it is not the sole mechanism for facilitating the development ofrenewable energy in Illinois or providing value for the environmental attributes of electricitygeneration. Thus, many items that may be of interest to readers of this Plan are not directlyaddressedinthisPlan,andbelowisanon‐exhaustivelistofthoseitemsnotaddressedinthePlan:

5420ILCS3855/1‐75(c)(1)(O).55AsdiscussedinSections2.6.1and8.4.3,uptoone‐halfofexcesscollectionsbyutilitiesforRPSpurposesineachofthe2017‐2018,2018‐2019,and2019‐2020deliveryyearsmaybeusedfortheSolarforAllProgramintheeventofa“fundingshortfall”.220ILCS5/16‐108(k).56220ILCS5/16‐108(k).


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Contracts or tariffs for the sale of energy from renewable energy generating facilities,whether through bilateral contracts, wholesale market sales, community renewablegenerationbillcrediting,ornetmetering;

RenewableenergyresourceprocurementobligationsofalternativeretailelectricsuppliersunderSection16‐115DofthePUA;

The procurement of zero emission credits from zero emission facilities (i.e., nucleargeneratingfacilities)underSection1‐75(d‐5)oftheIPAAct;

Workforcedevelopmentplansproducedbyautilitypursuant toSection16‐108.12of thePUA;

RenewableenergygeneratingdeviceinstallercertificationrequirementsdevelopedpursuanttoSection16‐128AofthePUA;

RenewableenergyprovidersupplierdiversitygoalsunderSection5‐117(b)ofthePUA; Tarifffilingsormodificationsforthecollectionoffundsusedbyutilitiestopayforrenewable

energycreditandzeroemissioncreditdeliverycontracts; Specificrenewableenergygeneratingprojects,proposals,orsites; “Green” or “clean energy” retail supply productsmarketed and sold by alternative retail

electricsuppliers.

TheseissuesmayindeedbeofsignificantinteresttotheAgency,andinsomecases,theirpresenceorresolutioninformeddecisionsmadeinthisPlan.However,astheydonotfallwithinthescopeandjurisdictionofwhat the IPAmaypropose and theCommissionmay approve aspart of thisPlan,specificproposalsrelatedtotheabove‐listedtopicsarenotmadewithinthisdocument.

2.2.7. PlanDevelopmentandApprovalThePlandevelopmentandapprovallargelymirrorstheprocessesapplicabletotheAgency’sannualprocurementplanandzeroemissionstandardprocurementplan,onlywithlongertimelines.

The process begins with the Agency developing an initial draft of this Plan, while Section 1‐75(c)(1)(A)oftheIPAActprovidesthatthe“initial,”ordraft,Plan“bereleasedforcommentnolaterthan 160 days after” the effective date of P.A. 99‐0906 (i.e., June 1, 2017). Section 16‐111.5(b)(5)(ii)(B)ofthePUAprovidesthattheAgency“shallpublishforcommenttheinitiallong‐termrenewableresourcesprocurementplannolaterthan120daysaftertheeffectivedate.” TheAgencyhaschosentocomplywiththetighterofthetworequirements,ensuringcomplianceundereitherapproach,andthusreleaseditsdraftPlanonSeptember29.2017.AswiththeIPA’sannualprocurementplanpreparedpursuanttoSection16‐111.5(d)(2)ofthePUA,copiesofthedraftPlan“andall subsequent revisions” shall beposted to the IPAand ICCwebsitesandprovided toeachaffectedelectricutility.

Thelawthenprovidespartieswith45daystoprovidecommentonthedraftplan.CommentsaremadepubliclyavailablethroughbeingpostedontheIPA’sandICC’swebsites,andsuchcommentsarerequiredtobe“specific,supportedbydataorotherdetailedanalyses,and,ifobjectingtoalloraportionoftheprocurementplan,accompaniedbyspecificalternativewordingorproposals.”

Duringthecommentperiod,theAgencyheldpublichearingsforreceivingpubliccommentonthePlanintheserviceterritoryofeachaffectedutility.TheAgency’shearingsoccurredonOctober26thin Springfield (Ameren Illinois), October 31st in Chicago (ComEd), andNovember 3rd inMoline(MidAmerican).


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With a draft Plan release date of September 29, 2017, commentswere due on the draft Plan byNovember 13, 2017. 49 comments were received from: 3Degrees, Ameren Illinois, APX, CarbonSolutions Group, Center for Resource Solutions, City of Springfield, Clean Energy Design Group,Coalition forCommunity SolarAccess, ComEd,DirectEnergy,Downstate Caucus, ElevateEnergy,EnvironmentalDefenseFund/CitizensUtilityBoard,EnvironmentalLawandPolicyCenter,ExelonGeneration,ForeFrontPower,GRIDAlternatives,GRIDAlternatives/ElevateEnergy,IGSSolar/SGCPower, Illinois Attorney General, Illinois Commerce Commission Staff, Illinois Municipal ElectricAgency,IllinoisNationalAssociationfortheAdvancementofColoredPeople,IllinoisPeople'sAction,IllinoisSolarEnergyAssociation, IllinoisSolar forAllWorkingGroup, InnovativePowerSystems,InterstateRenewableEnergyCouncil,JointSolarParties,KimberlyWasserman/VeronicaKyle/KeithHarley,LandleaseEnergyDevelopment,LittleVillageEnvironmentalJusticeOrganization,MarseillesLand&Water,MetropolitanMayorsCaucus,NaturalResourcesDefenseCouncil,NorthernIllinoisHydropower, Renewables Suppliers, Sierra Club, SolAmerica Energy, Solar Energy IndustriesAssociation, SRECTrade, Sunvest Solar, Syncarpha Capital, Tick Tock Energy, Trajectory EnergyPartners,VillageofOakPark,VoteSolar,WillCounty,andWindontheWires.

After the conclusion of the comment period, “the Agency may revise the long‐term renewableresources procurement plan based on the comments received” and, within 21 days after theconclusionofthatperiod,“shallfiletheplanwiththeCommissionforreviewandapproval.”57ThiswouldleavetheAgencywithafilingdeadlineofDecember4,2017.ThisPlanfiledforCommissionreviewandapprovalreflectstherevisionsmadebytheAgencyinresponseto,andconsiderationof,thecommentsreceived.58

The IllinoisCommerceCommission’sPlanapprovalproceedingwill take the formof a contested,docketedproceedinggovernedbytheCommission’sRulesofPractice(Title83,Part200oftheIllinoisAdministrativeCode).SimilartotherequirementsapplicabletotheIPA’sannualprocurementplans,within14daysafterthefilingofthePlan,“anypersonobjectingtotheplanmayfileanobjectionwiththeCommission.”59WithaDecember4,2017filingdate,“objections”wouldbeduebyDecember18,2017.Within21daysafterthefilingofthePlan,theCommissionshalldeterminewhetherahearingis necessary.60 Other deadlines, such as for Responses, Replies, the Administrative Law Judge’s(“ALJ”)ProposedOrder,andBriefsonException,willbesetbytheALJthroughanoticeissuedduringtheproceeding.

The Commission shall enter its order confirming ormodifying the initial Long‐Term RenewableResourcesProcurementPlanoranysubsequentrevisionswithin120daysafterthefilingoftheplanbytheIllinoisPowerAgency.61Again,withaDecember4,2017filingdate,thisleavestheCommissionwithanApril3,2018deadline for issuinganOrderconfirmingormodifyingtheplan. As for theCommission’s standard of review, it shall approve the Plan if it determines “that the plan will

57Id.58ForadditionaldiscussionoftheAgency’sreviewofcommentsreceived,andtheresultingpositionsmodifiedandexplanationofwhycertainpositionswerenotmodified,pleaserefertothePetitionaccompanyingthefilingofthisPlanforCommissionapproval.OntheIPA’swebsitecanbefoundaredlineshowingchangesinthisPlanagainsttheDraftPlanpublishedonSeptember29,2017.59220ILCS5/16‐111.5(b)(5)(ii)(C).60Id.61Id.


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reasonablyandprudentlyaccomplishtherequirementsofSection1‐56andsubsection(c)ofSection1‐75oftheIllinoisPowerAgencyAct.”62

2.2.8. PlanUpdatesWhiletheAgency’slong‐termrenewableresourcesprocurementplanfeaturesa“long‐term”focus,many elements informing future program and procurement decisions—technological progress,marketplacechanges,thesuccessorfailureofworkundertakenunderaprior‐approvedapproach—aresimplyunknowableatthistime.Asaresult,updatestothePlanwillbecrucialinensuringthatgoalsoftheRPSareefficientlymet.

ThePUAprovidesthattheAgency“shallreview,andmayrevise,theplanatleastevery2years”afterthe initial Plan, and “shall review and propose any revisions to the long‐term renewable energyresources procurement plan in conjunction with the Agency's other planning and approvalprocesses”63 conducted under this Section 16‐111.5 of the PUA—specifically, the annualprocurement plan development and approval process referenced in Section 16‐111.5(d).64 TheAgencydevelopsitsannualplaninJulyandAugustofeachyear,publishesthatplanforcommentbyAugust15,receivescommentsonthatplanover30days,andthenfilesthatplanwiththeCommission14dayslater.AsverylittleworkunderthisPlanwillhavebeendonebythetimetheAgencybeginsdevelopingitsnextannualprocurementplan(July2018),theAgencytentativelyplansforitsfirstrevisionstoitsLong‐TermRenewableResourcesProcurementPlantobeproposedin2019,aspartofthedevelopmentandapprovalprocessoftheIPA’s2020annualprocurementplan,whichwilltakeeffectin2020.

Lastly,“theCommissionshallholdaninformalhearingforthepurposeofreceivingcommentsontheprioryear'sprocurementprocessandanyrecommendationsforchange”onorbeforeJuly1ofeachyear.65Insatisfyingasimilarrequirementapplicabletotheannualprocurementplan,thishastakentheformofwrittenrecommendations,technicalorsubstantive,beingsubmittedtotheCommissionandpostedpubliclyontheCommission’swebsite.

2.3. TheRPSandPercentage‐BasedGoalsoftheRPSTheIllinoisRPSsharessimilaritywithotherstateRPSswhichrequirethatacertainpercentageofelectricitysalesbemetwithaclimbingpercentageofrenewableenergyorrenewableenergycreditprocurement.ForIllinois,thistotalis25%by2025:“13%bythe2017deliveryyear;increasingbyatleast1.5%eachdeliveryyearthereaftertoatleast25%bythe2025deliveryyear;andcontinuingatnolessthan25%foreachdeliveryyearthereafter.”66

2.3.1. LoadApplicabletoRPSGoalsAtfirstblush,theAgency’s25%by2025goalappearstomirrortheSection1‐75(c)(1)targetsfoundinIllinoislawpriortoP.A.99‐0906.However,priortoP.A.99‐0906,only“eligibleretailcustomer”

62220ILCS5/16‐111.5(b)(5)(ii)(D).63220ILCS5/16‐111.5(b)(5)(ii)(B).64Section1‐75(c)(1)(A)oftheActcontainsasimilarprovision,statingthat“[t]heAgencyshallreview,andmayreviseonanexpeditedbasis, the long‐termrenewable resourcesprocurementplanat least every2years,which shall be conducted in conjunctionwith theprocurementplanunderSection16‐111.5ofthePublicUtilitiesActtotheextentpracticabletominimizeadministrativeexpense.”65220ILCS5/16‐111.5(b)(5)(vi).6620ILCS3855/1‐75(c)(1)(B).


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load—meaning load associated with utility default supply customers, and not customers takingsupplythroughalternativeretailelectricsuppliersorthroughhourlypricing—wassubjecttothisrequirement. In recent years, only 30‐50% of potentially eligible retail customer load actuallyreceiveddefaultsupplyservice,whilecompetitiveclasscustomers(includingallmediumto largecommercial and industrial customers—who represent approximately half of total load) had nodefaultsupplyoption.Stateddifferently,whiletheRPSfeatureda“25%by2025”requirementpriortoP.A.99‐0906,thevastmajorityofretailcustomerloadinIllinoiswasnotcoveredbySection1‐75(c)(1)’s“25%by2025”RPSgoal.

Overtwodeliveryyears(beginningwiththe2017deliveryyear),P.A.99‐0906transitionsthosegoalsapplicable only to “eligible retail customer” load to goals applicable to all “all load for retailcustomers.”Forthe2017deliveryyear,thosegoalsare“equaltoatleast13%ofeachutility'sloadfor eligible retail customers and 13% of the applicable portion of each utility's load for retailcustomerswhoarenoteligibleretailcustomers,”withtheapplicableportionat50%.Forthe2018deliveryyear,thepercentagegoalincreasesto14.5%whiletheapplicableportionincreasesto75%.Forthe2019deliveryyear,thepercentagegoalincreasesto16%andappliestoallretailcustomerload,includingloadassociatedwithAREScustomers.67

Oneexceptionexiststothisloadcalculationtransition,however:underSection1‐75(c)(1)(H),ifanARESownedoneormorerenewablegeneratingfacilitiesthatwerenotwindorphotovoltaicasofDecember31,2015,thenthatARESmayelect“tosupplyitsretailcustomerswithrenewableenergycreditsfromthefacilityorfacilities”solongasthosefacilitiescontinuedtobeownedbythatARES.Thisself‐procurementfromARES‐ownedfacilitiesbytheARESthusservestoreducethestatutoryrenewableenergyresourceobligationbytheamountofRECsself‐procured.

Furtherdiscussionofhowthesepercentage‐basedmultipliersapplytoretailcustomerloadtocreateactualRECprocurementtargetscanbefoundinChapter3.AsfurtherdiscussedwithinthatChapter,oftherenewableenergycreditsprocuredunderSection1‐75(c),“atleast75%shallcomefromwindandphotovoltaicprojects.”68

Notably,theserequirementsonlyapplytoloadservedbyIllinois’majorelectricdistributionutilities:ComEd, Ameren Illinois, and that portion of MidAmerican load for which the IPA conductsprocurements.TheIllinoisRPSgoalsdonotapplytoloadservedbymunicipalelectricutilities,ruralelectriccooperatives,orMt.CarmelPublicUtility,andthoseentitiesdonothaverenewableenergyprocurementobligationsunderIllinoislaw.

2.3.2. EligibleProjectsfortheIllinoisRPSNotallrenewableenergygeneratingfacilitiesareeligibletosellRECsintotheIllinoisRPS.Changesmade through P.A. 99‐0906 have significantly narrowed the universe of facilities capable ofgenerating RECs which qualify for the RPS, and specific criteria applicable to RECs or facilitiesproducingthoseRECsarediscussedfurtherbelow.

67Id.6820ILCS3855/1‐75(c)(1)(C).


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2.3.2.1. EligibleGeneratingTechnologies

TheIllinoisPowerAgencyAct’sdefinitionof“renewableenergyresource”setsforththegeneratingtechnologiescapableofproducingRECseligiblefortheIllinoisRPS.AssetforthinSection1‐10oftheIPAAct,theunderlyingenergymustbegenerated“fromwind,solarthermalenergy,photovoltaiccellsandpanels,biodiesel,anaerobicdigestion,cropsanduntreatedandunadulteratedorganicwastebiomass,treewaste,andhydropowerthatdoesnotinvolvenewconstructionorsignificantexpansionofhydropowerdams,”aswellas“landfillgasproduced in theState.” While this language largelymirrors thedefinitionof “renewableenergyresource”prior toP.A.99‐0906, thatActdeleted theinclusion of “other alternative sources of environmentally preferable energy” from the formerdefinition,thusclarifyingthatonlythosegeneratingtechnologiesdelineatedinthedefinitionmayqualify.

TheActalsosets forthcertaingenerating technologiescategorically incapableofproducingRECseligible for the Illinois RPS,which include “the incineration or burning of tires, garbage, generalhousehold, institutional, and commercial waste, industrial lunchroom or office waste, landscapewasteotherthantreewaste,railroadcrossties,utilitypoles,orconstructionordemolitiondebris,otherthanuntreatedandunadulteratedwastewood.”69

PleasenotethattheserequirementsaremerelythresholdrequirementsfortheIllinoisRPS;specificprograms, such as the Adjustable Block Program, or procurement targets may carry additionallimitations.

2.3.2.2. EligibleProjects—Locational

P.A.99‐0906alsointroducednewlocationalandpublicinterestbenefitrequirementsforgeneratingfacilitiesseekingtosellRECsintotheIllinoisRPS.FromtheintroductionoftheIllinoisRPSin2007toJune1,2011,Section1‐75(c)requiredtheAgencytofirstlooktorenewableenergyresourcesfromIllinois,thentoresourcesfromstatesadjoiningIllinois,andthentoelsewhere.AfterJune1,2011,theIPAfirstlookedtoresourcesfromIllinoisandadjoiningstates,andnextto“elsewhere.”

ThroughthenewSection1‐75(c)(1)(I),P.A.99‐0906shiftsthefocusoftheIllinoisRPS’sapproachtoprojectlocationinbothfocusandapproach.Ageneratingfacility’sRECsarenolongerprioritizedbasedonlocation;instead,thefacilityeitherqualifiesfortheIllinoisRPS,oritdoesnot.

Section1‐75(c)(1)(I)providesthatthePlanmustbedesigned“tomaximizetheState'sinterestinthehealth,safety,andwelfareof itsresidents, includingbutnot limitedtominimizingsulfurdioxide,nitrogenoxide, particulatematter andotherpollution that adversely affectspublic health in thisState,increasingfuelandresourcediversityinthisState,enhancingthereliabilityandresiliencyoftheelectricitydistributionsysteminthisState,meetinggoalstolimitcarbondioxideemissionsunderfederalorStatelaw,andcontributingtoacleanerandhealthierenvironmentforthecitizensofthisState.” While the statute presumes that a facility located in‐state provides those benefits at asufficientlevel,theAgencymayalso“mayqualifyrenewableenergycreditsfromfacilitieslocatedinstates adjacent to Illinois if the generator demonstrates and the Agency determines that theoperationofsuchfacilityorfacilitieswillhelppromotetheState'sinterestinthehealth,safety,andwelfareofitsresidents”basedonthispublicinterestcriteria.Asthelawprovidesnodiscussionof

6920ILCS3855/1‐10.


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potentiallyqualifyingfacilitieslocatedinstatesnot“adjacenttoIllinois,”theIPAbelievesfacilitieslocatedinthosestatescannotproduceRECsforsatisfyingtheIllinoisRPS.

TheAgency’sdiscussionofhowtoapplythesecriteriatoadjacentstatefacilities,aswellasalistingofwhichstatesareconsidered“adjacent”toIllinois,canbefoundinChapter4.

2.3.2.3. EligibleProjects—CostRecovery

Through Section 1‐75(c)(1)(J), P.A. 99‐0906 introduces an additional requirement on generatingfacilitiesseekingtogenerateRECseligiblefortheIllinoisRPS:“ageneratingunitwhosecostswerebeingrecoveredthroughratesregulatedbythisStateoranyotherstateorstatesonorafterJanuary1, 2017” is ineligible. The statute’s rationale behind this change is to “promote the competitivedevelopmentofrenewableenergyresourcesinfurtheranceoftheState'sinterestinthehealth,safety,andwelfareofitsresidents.”Thisraisesmultiplequestions,amongwhicharethefollowing:first,whatcriteriashouldbeusedfordeterminingwhetherafacility’scostsarebeingrecoveredthroughregulatedrates?Second,whatofmunicipalutilitiesorruralcooperativesthateffectivelyserveasvertically‐integratedutilities(insofarastheycanachievefullcostrecoveryforthedevelopmentofrenewableenergygeneratingfacilitiesthroughrates),butmaynotberegulatedby“thisstateoranyotherstateorstates”?TheAgency’sproposedapproachtotheseissuesisdiscussedinChapter4.

Thelawalsooffersmorepunitiveconsequencesifanon‐regulatedratefacilitybecomesaregulatedratefacilityaftertheexecutionofanIllinoisRPScontract;insuchasituation,thecontractmustbeterminatedand“thesupplierofthecreditsmustreturn110%ofallpaymentsreceivedunderthecontract”70(withthosepaymentsthenbeingusedfortheprocurementofadditionalRECsfromnewwindorphotovoltaicgenerationintheAgency’snextprocurementevent).

2.3.2.4. InstallerRequirements

Certain facilities seeking to participate in the RPS are also subject to an installer qualificationrequirement. Specifically, after June 1, 2017, “new photovoltaic projects or new distributedrenewableenergygenerationdevices[. . .]mustbeprocuredfromdevicesinstalledbyaqualifiedpersonincompliancewiththerequirementsofSection16‐128AofthePublicUtilitiesActandanyrulesorregulationsadoptedthereunder.”71

In Docket No. 17‐0268, the Illinois Commerce Commission adopted its Title 83, Part 461administrativerulesunderSection16‐128AofthePUA.Inthatproceeding,theCommissionadoptedthefollowingdefinitionfortheterm“qualifiedperson”:

"Qualified person" means a person who performs installations on behalf of thecertificate holder and who has completed at least one of the following programsrequiringlaborfieldworkandreceivedacertificationofsatisfactorycompletion:anapprenticeshipasajourneymanelectricianfromaUSDOL‐registeredoranapplicablestate‐agency‐registered electrical apprenticeship and training program; a NorthAmerican Board of Certified Energy Practitioners (NABCEP) distributed generationtechnology certification program; an electrical training program for in‐houseemployees established and administered by an electric utility regulated by the

7020ILCS3855/1‐75(c)(1)(J).7120ILCS3855/1‐75(c)(7).


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Commission; or anAssociate inApplied Science degree from an Illinois CommunityCollegeBoard‐approvedcommunitycollegeprograminsolargenerationtechnology.

ThePart461rulesalsoprovideadefinitionoftheterm“install”:

"Install" means to perform the electrical wiring and connections necessary tointerconnectthenewsolarprojectwiththeelectricutility'stransmissionordistributionsystematthepointofinterconnectionbetweentheprojectandtheutility."Install"inthisPartspecificallydoesnotmean:

Electricalwiring and connections to interconnect the new solar projectperformedbyutilityworkers;

Electrical wiring and connections internal to the new solar projectperformedbythemanufacturer;

The on‐site construction and installation of a solar panel or a collectorsubstation;or

Tasks relating to construction, planning and project managementperformed by individuals such as an inspector, management planner,consultant, project designer, or contractor for the project or theiremployees.

Definitions of these termswere initially approved by the Commission in a Second Notice Orderentered on August 25, 2017, and approvedwithmodification by the state’s Joint Committee onAdministrativeRules(“JCAR”)onOctober24,2017withaneffectivedateofOctober26,2017.

AnypartiesseekingtodevelopnewphotovoltaicprojectsorDGprojects inIllinoisshouldalsobeawareoftheCommission’sPart461andPart468rules(governingdistributedgenerationinstallers)andcertificationprocessmoregenerallyaswell.Thedefinitionof“Qualifiedperson”mayprecludetheinclusionofself‐installednewphotovoltaicprojectsintheAdjustableBlockProgram(unlesstheself‐installermeetsthedefinition).

2.3.3. ComplianceMechanism:RECsvs.“RenewableEnergyResources”OneotherchangetotheIllinoisRPSconcernswhatappearstobetheexclusiveuseofRECsasthecompliancemechanismformeetingIllinoisrenewableenergyprocurementtargets.PriortoP.A.99‐0906, Section 1‐75(c) required renewable energy procurement targets to be met through theprocurementof“renewableenergyresources”—eitheraREC,ortheRECanditsunderlyingenergy.WhilethevastmajorityoftheIPA’sprocurementactivitiesfocusedonlyontheprocurementofRECs,the2010long‐termpowerpurchaseagreementsare20‐yearcontractsforthedeliveryofa“bundled”RECandenergyproduct.

Ratherthanusingtheterm“renewableenergyresources,”Section1‐75(c)(1)(B)requiresthatthePlan“shall includethegoalsforprocurementofrenewableenergycredits”72tomeetthestatute’stargets.WhilethedescriptionoftheARESloadtransitionlaterinthatsamesubparagraph(B)usestheterm“renewableenergyresources,”subparagraph(C)andlatersubparagraphsalsoreferonlytotheprocurementof“renewableenergycredits”(althoughsubparagraph(E)references“renewableenergyresources”).

72Emphasisadded.


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Ashift in focus from“resources” to “RECs”makes intuitivesense; the IPA’spriorSection1‐75(c)renewable energy planning and procurement processeswere conducted in conjunctionwith thedevelopmentofitsannualprocurementplanformeetingtheenergysupplyrequirementsofeligibleretailcustomers,andusedtomeetprocurementrequirementsspecifictothatcustomerbase.WhiletheIPAnowconductsrenewableenergyplanningandprocurementprocesses(eventually)tomeetgoalsandtargetsapplicabletoallretailcustomerload,itsenergyprocurementsstillfocusonlyoneligible retail customer load—thus creating a disconnect between the universes of supplyrequirementsservedbythesetwoexercises.

WhiletheIPAhasnotdevelopedafinalpositiononwhetheritcouldeventuallyprocureabundledREC and energy product through the Plan or future revisions to it, or some combination of itsconcurrent planning and procurement processes, the Agency proposes no such bundled productprocurementsaspartofthisPlanandbelievesthatnochangesmadetothelawjeopardizeprior‐executedbundled“renewableenergyresource”contracts(suchasthe2010LTTPAs).

2.3.4. RPSFundingandRateImpactCapAsbefore,theprocurementofrenewableenergycreditscontinuestobeconstrainedbyanannualprocurement budget established through a rate impact cap. Specifically, “the total of renewableenergyresourcesprocuredundertheprocurementplanforanysingleyear...shallbereducedforallretailcustomersbasedontheamountnecessarytolimittheannualestimatedaveragenetincreasedue to the costs of these resources included in the amounts paid by eligible retail customers inconnectionwith electric service to nomore than the greater of 2.015% of the amount paid perkilowatthourbythosecustomersduringtheyearendingMay31,2007ortheincrementalamountper kilowatthour paid for these resources in 2011.”73 The greater of these amounts—the 2007amountperkilowatt‐hour(“kWh”),asbothamountsareknownand,foreachutility,itisgreater74—then“shallbeappliedtotheactualamountofkilowatthoursofelectricitydelivered,orapplicableportionof such amount [. . .] by the electric utility in thedelivery year immediately prior to theprocurement to all retail customers in its service territory.” This produces an annual RECprocurementbudgetforthe“costsofthoseresources”inagivenyear.75

Foralimitedperiod,P.A.99‐0906’schangestoSection16‐108(k)ofthePUAalsoallowforbudgetamountstoberolledovertofutureyears.Thosechangesprovidethatratherthanconductingannualreconciliations of collections and costs, the Commission “shall instead conduct a single review,reconciliation,andtrue‐upassociatedwithrenewableenergyresources'collectionsandcostsforthe4‐year period beginning June 1, 2017 and ending May 31, 2021, provided that the review,reconciliation,andtrue‐upshallnotbeinitiateduntilafterAugust31,2021.”76Overthatfour‐yearperiodpriortotheeventualreconciliation,“theutilityshallbepermittedtocollectandretainfundsunderthissubsection(k)andtopurchaserenewableenergyresourcesunderanapprovedlong‐term

7320ILCS3855/1‐75(c)(1)(E).74ThespecificcostcaprateforeachofthethreeutilitiesisshowninTable3‐1inChapter3ofthisPlan.75TheexceptionreferencedaboveinSection1‐75(c)(1)(H)servestoreduceavailablebudgetsaswell,as“thechargesthatwouldotherwisebeapplicabletotheretailcustomersofthealternativeretailelectricsupplier...shallbereducedbytheratioofthequantityofrenewableenergycreditssuppliedbythealternativeretailelectricsuppliercomparedtothatsupplier'stargetrenewableenergycreditquantity.”76ChangesunderP.A.99‐0906alsoprovidethattheutilityshallnotberequiredto“advanceanypaymentorpayanyamountsthatexceedtheactualamountofrevenuescollectedbytheutility”underitsSection16‐108(k)RPSrider,and“contractsexecutedunderthisSectionshallexpresslyincorporatethislimitation.”20ILCS3855/1‐75(c)(1)(L)(vii);alsosee220ILCS5/16‐111.5(b)(5)(iv).


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renewableresourcesprocurementplanusingthosefundsregardlessofthedeliveryyearinwhichthefundswerecollectedduringthe4‐yearperiod.”

Through the budgets established under the rate impact cap and the associated tariffs for thecollectionoffunds,theapplicableelectricutility“shallbeentitledtorecoverallofitscostsassociatedwiththeprocurementofrenewableenergycredits”underthePlan,including“associatedreasonableexpenses for implementing theprocurementprograms, including,butnot limited to, the costs ofadministering and evaluating the Adjustable Block program.”77 As a result, annual procurementbudgets based only on REC costs would be inaccurate, and some estimate of associatedadministrativeexpensesmustbe includedandtaken intoaccount. Furtherdiscussionof therateimpactcap,andtheprojectedbudgetsproducedundertherateimpactcap,canbefoundinChapter3.

2.3.5. EmploymentOpportunitiesThe law also provides that “the renewable energy credit procurements, Adjustable Block solarprogram,andcommunityrenewablegenerationprogramshallprovideemploymentopportunitiesfor all segments of the population and workforce, including minority‐owned and female‐ownedbusinessenterprises,andshallnot,consistentwithStateandfederallaw,discriminatebasedonraceorsocioeconomicstatus.”78TheIPAbelievesstronglyintheprinciplesoutlinedinthisstatementinthe law, and believes that its Plan—including provisions to lower the barrier to entry in theAdjustableBlockProgramforminority‐ownedandfemaleownedbusinesses,itsIllinoisSolarforAllproposals,itsapproachtogenerationinadjacentstates,anditsapproachtothegeographicdiversityofprojectswithinIllinois—properlytakesthoseconsiderationsintoaccountandwillresultinthoseopportunitiesbeingprovided.

2.4. QuantitativeNewBuildTargetsoftheRPSSection1‐75(c)(1)(B)oftheIPAActestablishespercentage‐basedumbrellagoalsforRECsrequiredtobeprocuredbasedonapercentageofapplicableretailcustomerload,butwithinthoseumbrellarequirements,other,morespecificrequirementsmustbealsobemet.OnesuchrequirementistheprocurementofRECsfrom“newwindprojects”and“newphotovoltaicprojects”foundinSection1‐75(c)(1)(C).Ratherthanexpressedasapercentageofload,theserequirementsareexpressedonaquantitativebasis(i.e.,afixed,statutorily‐definedminimumnumberofRECs)whilecountingtowardtheoverallrenewablesprocurementrequirements.

2.4.1. QuantitativeProcurementRequirementsThequantitativetargets foundinSection1‐75(c)(1)(C)arestraightforwardandsymmetrical,andoperateasfollows:

Bytheendofthe2020deliveryyear(May31,2021):

Atleast2,000,000renewableenergycreditsforeachdeliveryyearshallcomefromnewwindprojects;and

7720ILCS3855/1‐75(c)(6).7820ILCS3855/1‐75(c)(7).


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At least 2,000,000 renewable energy credits for each delivery year shall come fromnewphotovoltaicprojects.







For the “newphotovoltaicproject” requirement,at least50%mustcome fromsolarphotovoltaicprojectsusingtheAdjustableBlockProgram(usedtosupportdistributedgenerationandcommunitysolar,asdiscussedfurtherbelow),atleast40%fromutility‐scalesolarprojects,andatleast2%fromnon‐communitysolarbrownfieldsitephotovoltaicprojects.79TheAgencyunderstandsthis“atleast50%”concepttobefirst,intermsofRECs(asopposedtobudgetorinstalledcapacity),andalso,ofthequantitativetargetamountslistedinthelaw(as,ineachofSections1‐75(c)(1)(C)(i),(ii),and(iii)“ofthatamount”referencestheRECamountexpresslyprecedingitinthelaw),andnotnecessarily50%oftheoverallnumberofRECsprocured.80

TheAgency’sproposedprocurementsformeetingthesetargetscanbefoundinChapter5.

2.4.2. “Newwindproject”and“newphotovoltaicproject”DefinitionThedefinitionsofa“newwindproject”anda“newphotovoltaicproject”arealsoaddressedthroughthestatute. Whatconstitutesa“newphotovoltaicproject”isstraightforward;itisa“photovoltaicrenewableenergyfacilit[y]that[is]energizedafterJune1,2017.”81ProjectsdevelopedunderSection

79TheIPAAct,asmodifiedbyP.A.99‐0906,definesa“brownfieldsitephotovoltaicproject”as:

[P]hotovoltaicsthatare:(1)interconnectedtoanelectricutilityasdefinedinthisSection,amunicipalutilityasdefinedinthisSection,a

publicutilityasdefinedinSection3‐105ofthePublicUtilitiesAct,oranelectriccooperative,asdefinedinSection3‐119ofthePublicUtilitiesAct;and

(2)locatedatasitethatisregulatedbyanyofthefollowingentitiesunderthefollowingprograms:(A) theUnited StatesEnvironmentalProtectionAgency under the federal ComprehensiveEnvironmental

Response,Compensation,andLiabilityActof1980,asamended;(B)theUnitedStatesEnvironmentalProtectionAgencyundertheCorrectiveActionProgramofthefederal

ResourceConservationandRecoveryAct,asamended;(C)theIllinoisEnvironmentalProtectionAgencyundertheIllinoisSiteRemediationProgram;or(D)theIllinoisEnvironmentalProtectionAgencyundertheIllinoisSolidWasteProgram.

20ILCS3855/1‐10.80Thus,weretheAdjustableBlockProgramtobeextremelysuccessfulveryquicklyandexceedthetargetsof1,000,000RECsbytheendof2020‐2021and1,500,000RECsbytheendof2025‐2026,the“atleast40%”requirementforutility‐scalephotovoltaicprojectsremainsat40%ofthenewphotovoltaictargetsstatedinthelaw,or800,000RECsbytheendofthe2020deliveryyearand1,200,000RECSbytheendofthe2025deliveryyear.20ILCS3855/1‐75(c)(1)(C)(i),(ii).8120ILCS3855/1‐10.


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1‐56oftheIPAAct(i.e.,supplementalphotovoltaicandIllinoisSolarforAllprojects)arenoteligibletomeetquantitative“newphotovoltaicproject”targets.82

Thedefinitionofa“newwindproject”ismoreawkward.Thelawdefines“newwindprojects”as“wind renewable energy facilities that are energized after June 1, 2017 for the delivery yearcommencingJune1,2017orwithin3yearsafterthedatetheCommissionapprovescontractsforsubsequentdeliveryyears.”83Thiscouldbeunderstoodinoneoftwoways:perhapsmostliterally,thismeansthatforanydeliveryyearafterJune1,2017(“subsequentdeliveryyears,”beginningwiththe2018deliveryyear),anewwindproject,onceenergized,isonly“new”untiltheendofthe3yearsafterthedateonwhichtheCommissionapprovesitsRECdeliverycontract.However,manywindprojectsmay take 3 years to develop, interconnect, and produce RECs, thusmeaning that RECsproduced from the facility would no longer be “new” around the time that the facility beginsoperation.Asthisinterpretationwouldallowforwindprojectstobe“new”foronlyabrief,definedperiodbeforethefacilitymayhavebegunoperation,theIPAbelievesthiscouldnothavebeenthedrafters’intent.

Instead,theIPAunderstandsthat“forsubsequentdeliveryyears”—projectsforwhichcontractsareenteredintoonorafterJune1,2018—the“3yearsafterthedate”ofcontractapprovaliseffectivelyadeadlinebywhenthefacilitymustbe“energized”forittoretainits“new”statusunderthelawgoingforward.Stateddifferently,ifthefacilityisabletobeenergizedwithin3yearsafterthedateonwhichtheCommissionapprovesitsRECcontract,thenthoseRECsmaybecountedtowardthe“newwindproject”procurementtargetsinthelawoverthelifeofthecontract.However,ifthewindprojectcannotenergizewithin3yearsafterCommissionapproval,itsRECsmaynotbeusedtocounttowardquantitative“newwindproject”targets,andresultantRECdeliverycontractsshouldreflectaconsequenceforthatchangeinlegalstatus(astheproject’sRECswouldthenhavelessvalueinmeetingtherequirementsoftheRPS;theywouldmeetthepercentagegoalsofSection1‐75(c)(1)(B)oftheAct,butnotthequantitativeRECtargetsofSection1‐75(c)(1)(C)).

Ofcourse,bothofthesedefinitionsraisethequestionofwhatconstitutesafacilitybeing“energized.”Unlikeinterconnection,whereofficialapprovalisrequiredandassociatedformsareproducedandexecutedonaspecificdate,“energized”ismorenebulousand,unfortunately,notdefinedthroughthelaw.FacedwithasimilarquandaryindevelopingitsSupplementalPhotovoltaicProcurementPlan,theAgencysettledonadefinitionof“energized”asbeing“thedatebywhichtheSystemhasbeenturned on for a period of 24 consecutive hours and is operational for purposes of generatingelectricityregardlessofwhetherthesystemhasregisteredwithaRECtrackingsystem.”Partiescouldthensubstantiateasystem’senergizationthroughacertificationaccompaniedbythesubmissionofvarious forms establishing a system’s energization timeline. The Agency notes that unlike theSupplementalPhotovoltaicProcurementprocess, inwhichpaymentforRECswasmadeafterRECgenerationandonlyupondeliveryandinvoicetotheAgency,theAdjustableBlockProgramandtheIllinoisSolarforAllProgramfeatureprepaymentforsome,orall,oftheRECsfromasystemuponenergization.Therefore,asdiscussedinChapters6and8,someconsiderationshouldbemadeofasystembeing registered in a tracking system to generate RECs in addition to the date onwhichinterconnectiontotheutilitywasapproved.

82Id.8320ILCS3855/1‐75(c)(1)(C).


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2.4.3. InitialForwardProcurementsIndependentof(andpotentiallypriorto)thedevelopmentofthisPlan,P.A.99‐0906calledontheIPAtoconduct“initialforwardprocurements”ofRECsfrom“fromnewutility‐scalewindprojects”and“from new utility‐scale solar projects and brownfield site photovoltaic projects.”84 ConductedthroughcompetitiveprocurementprocessessubjecttoapplicablerequirementsofSection16‐111.5of thePUA, the Initial ForwardProcurement sought/seeks 15‐yearRECdelivery contracts set tobegindeliveryonJune1,2019attheearliestandJune1,2021atthelatest.Forbothwindandsolar,theoverallRECprocurementquantitiesare1,000,000RECs,withthewindprocurementrequiredtotakeplacewithin160daysofJune1,2017andthesolarprocurementpotentiallyconductedacrossmultipleprocurementeventsuptooneyearfromJune1,2017.85

ThestatuteprovidesthatRECsprocuredthroughtheInitialForwardProcurement“shallbeincludedintheAgency'sLong‐TermRenewableResourcesProcurementPlanandshallapplytoallrenewableenergygoals”86foundinSection1‐75(c)oftheIPAAct,includingthequantitative“newwind”and“newphotovoltaic”targetsdiscussedabove.TheAgency’sInitialForwardProcurementfornewwindhas concluded, as has the first of the Agency’s procurement events for new photovoltaics; theexpectedresultsoftheInitialForwardProcurement,aswellashowthoseresultsinformremainingquantitativeprocurementtargets,arediscussedfurtherinChapters3and5.

2.4.4. SubsequentForwardProcurementsSection 1‐75(c)(1)(G)(iii) also floats the concept of “subsequent forward procurements.” Thatsection sets forth conditions applicable to subsequent forward procurements: theymust be “forutility‐scalewindprojects,”they“shallsolicitatleast1,000,000renewableenergycreditsdeliveredannuallyperprocurementevent,”andtheyshallbe“planned,scheduled,anddesignedsuchthatthecumulativeamountof[RECs]deliveredfromallnewwindprojectsineachdeliveryyearshallnotexceedtheAgency'sprojectionofthecumulativeamountof[RECs]thatwillbedeliveredfromallnewphotovoltaicprojects,”inthatsamedeliveryyear.

However,thelawdoesnotcontainstatementseitherrequiringthattheAgencyconductasubsequentforwardprocurement,orrequiringthatRECsfromutility‐scalewindprojectsmayonlybeprocuredusingasubsequentforwardprocurementmodel.Nevertheless,consistentwiththespiritofthelawand in recognition that the Agencywill need to procure at least 1,000,000 additional newwindprojectRECstomeetitsSection1‐75(c)(1)(C)(i)2020DeliveryYearquantitativenewwindtarget(asnomorethan1,000,000couldbeprocuredthroughtheinitialforwardprocurementtomeeta2,000,000RECtargetfor2020‐2021),theAgencyhasproposedaSubsequentForwardProcurementforRECsfromnewwindprojectsaspartofthePlan.FurtherdiscussionoftheAgency’sproposedSubsequentForwardProcurementcanbefoundinChapter5.

2.4.5. BalancingExpectedWindRECsvs.SolarRECsInadditiontotheconditionplacedonsubsequentforwardprocurementsmentionedabove,thelawalso contains amore general requirement thatRECsunder contract fromnewwindprojectsnotsignificantly exceed RECs under contract from new photovoltaic projects. Specifically, if the

8420ILCS3855/1‐75(c)(1)(G)(i),(ii).85Id.86Id.


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projectedamountofRECsfromnewwindprojectstobedeliveredinagivendeliveryyearexceedstheprojectedamountofRECsfromnewphotovoltaicprojectsby200,000ormoreRECs,then“theAgencyshallwithin60daysadjusttheprocurementprogramsinthelong‐termrenewableresourcesprocurementplantoensurethattheprojectedcumulativeamountofrenewableenergycreditstobedeliveredfromallnewwindprojectsdoesnotexceedtheprojectedcumulativeamountofrenewableenergycredits tobedelivered fromallnewphotovoltaicprojectsby200,000ormorerenewableenergycredits.”87

ThisrequirementisnotintendedtobeapplicabletoresultsfromtheInitialForwardProcurements,atleastinitially.GiventhattheInitialForwardProcurementcallsfor1,000,000RECsfrom“newwindprojects” tobeprocured“within160daysaftertheeffectivedate”ofP.A.99‐0906,butthe InitialForwardProcurementfrom“newphotovoltaicprojects”istobeprocured“withinoneyearaftertheeffectivedate,”thelawopenlyaccommodatesalongertimehorizonforbringingsolarRECsundercontract from the initial forward procurements. As the law expressly establishes thismatchingrequirementasonlyapplicable“atanytimeafterthetimesetfordeliveryofrenewableenergycreditspursuant to the initial procurements,”88 the IPA understands that this requirement becomesapplicabletoitsplanningprocessafterJune1,2021,thelatestdateforfirstdeliveryofRECsfromtheinitialforwardprocurements.

ThelawalsoprovidesthattheAgencyshallprovide“itsprojectionoftherenewableenergycreditstobedeliveredfromallprojectsineachdeliveryyear”ona“quarterlybasis.”89

2.5. AdjustableBlock&CommunityRenewableGenerationProgramsAsreferencedabove,atleast50%ofthequantitativenewphotovoltaictargetsfoundinSection1‐75(c)(1)(C)of the IPAActshallbeprocured“fromsolarphotovoltaicprojectsusing theprogramoutlinedinsubparagraph(K)ofthisparagraph(1)fromdistributedrenewableenergygenerationdevicesorcommunityrenewablegenerationprojects”—i.e.,usingtheAdjustableBlockProgram.

2.5.1. AdjustableBlockProgramAt its core, the Adjustable Block Program is perhapsmost notable forwhat it is not: it is not a“competitiveprocurementevent”using“payasbid”pricingwithselectionofbidson thebasisofprice.Norisitaprojectselectionprocessthroughwhichpublicinterestcriteria,suchasthosesetforth inSection1‐75(c)(1)(I)or thoseemployed for theselectionofwinningbidsunder theZeroEmissionStandardfoundinSection1‐75(d‐5)oftheIPAAct,determinethewinningbidder.

Instead,theAdjustableBlockProgramprovides“atransparentscheduleofpricesandquantitiestoenable thephotovoltaicmarket to scaleupand for renewable energy creditprices to adjust at apredictable rate over time.”90 Stated differently, a party seeking a REC contract—such as aphotovoltaicdistributedgenerationorcommunitysolarprojectdeveloper—knowstheRECpriceinadvance, and has visibility intowhen and how that pricemay change. The law sets forth otherrequirements of the Adjustable Block Program: it must include “a schedule of standard blockpurchaseprices tobeoffered;aseriesofsteps,withassociatednameplatecapacityandpurchase

8720ILCS3855/1‐75(c)(1)(G)(iv).88Id.89Id.9020ILCS3855/1‐75(c)(1)(K).


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pricesthatadjustfromsteptostep;andautomaticopeningofthenextstepassoonasthenameplatecapacityandavailablepurchasepricesforanopensteparefullycommittedorreserved.”91 Thus,eachblockconstitutesaquantityofnameplatecapacitywithaRECprice92attachedtothatblock,andwhenablockisfullysubscribedbyqualifyingprojects,projectsmaythenqualifyforthenextblock(whichfeaturesadifferentprice).TheAgencyunderstandsthat“automaticopening”asusedinthelawneednotbe“immediate”or“instantaneous,”andinsteadthat“automatic”referstotheabilityfortheblocktoopeninapredictablemannernotrequiringadditionaladministrativeaction.

2.5.1.1. AdjustableBlockProgram—Projects

The Adjustable Block Program is applicable to only two project types: photovoltaic distributedrenewable energy generation devices (i.e., solar DG), and photovoltaic community renewablegenerationprojects(i.e.,communitysolar93).

UnderIllinoislaw,aphotovoltaicdistributedrenewableenergygenerationdevicemustbe:

(1) Poweredbyphotovoltaics;(2) interconnectedatthedistributionsystemlevelofeitheranelectricutilityasdefinedinthis

Section, a municipal utility as defined in this Section that owns or operates electricdistributionfacilities,oraruralelectriccooperativeasdefinedinSection3‐119ofthePublicUtilitiesAct(andthus,mustbelocatedinIllinoistobeinterconnectedtosuchanentity);

(3) locatedonthecustomersideofthecustomer'selectricmeterandisprimarilyusedtooffsetthatcustomer'selectricityload;and

(4) limitedinnameplatecapacitytolessthanorequalto2,000kilowatts.94

UnderIllinoislaw,aphotovoltaiccommunityrenewablegenerationprojectisagenerationfacilitythat:

(1) ispoweredbyphotovoltaics;(2) is interconnected at the distribution system level of an electric utility as defined in this

Section, a municipal utility as defined in this Section that owns or operates electricdistributionfacilities,apublicutilityasdefinedinSection3‐105ofthePublicUtilitiesAct,oranelectriccooperative,asdefinedinSection3‐119ofthePublicUtilitiesAct(andthus,mustbelocatedinIllinoistobeinterconnectedtosuchanentity);

(3) creditsthevalueofelectricitygeneratedbythefacilitytothesubscribersofthefacility;and(4) islimitedinnameplatecapacitytolessthanorequalto2,000kilowatts.95

Onlynewprojects—those“energizedonorafterJune1,2017”—areeligiblefortheAdjustableBlockProgram.

91Id.92Notethatpricescanbeasetvalue,orestablishedastheproductofaformula.93ThereareotherformsofcommunitysolarrecognizedbyIllinoislaw,including(A)propertiesownedorleasedbymultiplecustomersthatcontributetotheoperationofaneligiblerenewableelectricalgeneratingfacility,and(B)individualunits,apartments,orpropertieslocated in a single building that are ownedor leasedbymultiple customers and collectively served by a commoneligible renewableelectricalgeneratingfacility.220ILCS5/16‐107.5(l)(1).TheseformsofcommunitysolararenoteligiblefortheAdjustableBlockProgram.9420ILCS3855/1‐10.95Id.


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IntermsofwhatprojecttypesparticipateatwhatlevelwithintheAdjustableBlockProgram,thelawprovidesthefollowingdelineation:

(1) At least 25% from distributed renewable energy generation devices with a nameplatecapacityofnomorethan10kilowatts;

(2) At least 25% from distributed renewable energy generation devices with a nameplatecapacityofmorethan10kilowattsandnomorethan2,000kilowatts.96

(3) Atleast25%fromphotovoltaiccommunityrenewablegenerationprojects.(4) Theremaining25%shallbeallocatedasspecifiedbytheAgencyinthelong‐termrenewable

resourcesprocurementplan.97

TheAgencybelievesthatthisremainingallocationrequirementdoesnotnecessarilyrequireastrictassignmentoftheremaining25%tooneofthepriorthreecategories,andthattheremaindercanbeallocatedtoadjustforongoingprogramperformanceoftheothercategories.

Theabovecategoriesalsoraisethequestionof“25%ofwhat”—installedcapacity?Budgets?RECs?While the statute is perhaps unclear, the IPA believes that, given that RECs are the standardcompliancepathwayintherevisedIllinoisRPS,25%shouldbeunderstoodtorefertothenumberofRECsprocuredfromprojectsofthattype.

ThelawalsoprovidesthattheAdjustableBlockProgramshallensurethatRECsareprocuredfrom“projectsindiverselocationsandarenotconcentratedinafewgeographicareas.”Atpresent,theAgencybelievesthatnospecialincentiveoradderbasedonlyongeographicdiversityisnecessarytoensurethatthisobjectiveismet,butcommitstomonitorthelocationsofproposedandcompletedprojects,andtoreviewandreportonthisissueinthenextrevisiontothePlan.

2.5.1.2. AdjustableBlockProgram—Contracts

Section1‐75(c)(1)(L)setsforthcertainrequirementsapplicabletoRECdeliverycontractsenteredintothroughtheAdjustableBlockProgram.Thefirstisthatcontractsmustbe“atleast15yearsinlength,” which the Agency understands to require at least 15 years of REC deliveries under thecontract. Payment forRECs ismadeby(andRECsaredeliveredto)theapplicableelectricutility(whichisthenrequiredtoretiretheRECs),andpaymentisrequiredbylawtooccuraccordingtothefollowingschedule:

ForDGsystemsofnomorethan10kW,“therenewableenergycreditpurchasepriceshallbepaidinfullbythecontractingutilitiesatthetimethatthefacilityproducingtherenewableenergycreditsisinterconnected at the distribution system level of the utility and energized.”98 The Agencyunderstands“purchaseprice”torefertothesumofpaymentsforRECsrequiredtobemadeunderthecontract,orfullprepayment.99

96 The Agencymay create sub‐categorieswithin this category to account for the differences between projects for small commercialcustomers,largecommercialcustomers,andpublicornon‐profitcustomers.9720ILCS3855/1‐75(c)(1)(K).9820ILCS3855/1‐75(c)(1)(L)(ii).TheAgencyunderstandsthisprovisiontomeanthatasystem10kWinsizewouldbeincludedinthiscategory.99Allprepaymentremainssubjecttotheamountsactuallycollectedbytheutilitiesunder itsSection16‐108(k)tariffs,however. (SeeSection1‐75(c)(1)(L)(vii)).


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For largerDGsystemsandcommunitysolarprojects, “20percentof therenewableenergycreditpurchasepriceshallbepaidbythecontractingutilitiesat thetimethatthe facilityproducingtherenewable energy credits is interconnected at the distribution system level of the utility andenergized”withtheremainingportion“paidratablyoverthesubsequent4‐yearperiod.”100

Prepaymentposesuniquechallenges—whileRECsarerequiredtobedeliveredwhengeneratedtomeet annual utility compliance obligations, prepayment reduces the incentive to actually deliverRECs. On this point, the law requires that each contract “shall include provisions to ensure thedeliveryoftherenewableenergycreditsforthefulltermofthecontract,”andtheAgency’sapproachtoclawbackprovisions,collateralrequirements,andothercontractelementsintendedtoensureRECdeliverycanbefoundinChapter6.

2.5.1.3. AdjustableBlockProgram—Changes

Unlike a competitive procurement process, throughwhich changes inmarket conditionsmay bereflected in bidders’ bids, the Adjustable Block Program requires that the Agency project futuremarketconditionsthroughestablishingfutureblocksizesandprices.

Thelawenvisionsthesechangesoccurringintwoways:first,theAgency“mayperiodicallyreviewitspriordecisionsestablishingthenumberofblocks,theamountofgenerationcapacityineachblock,and thepurchaseprice foreachblock,andmaypropose,onanexpeditedbasis, changes to thesepreviouslysetvalues”subjecttotheSection16‐111.5planrevisionprocess.101

Second,“[p]rogrammodificationstoanyprice,capacityblock,orotherprogramelementthatdonotdeviatefromtheCommission'sapprovedvaluebymorethan25%shalltakeeffectimmediatelyandarenotsubjecttoCommissionreviewandapproval.”102Thisraisesthequestionofwhatbaselinethe25% deviation cap should be based on—would two 20% changes over the course of a year bepermissible,asneitherwasabove25%eventhoughbothwereinaggregate?Ifnot,howlongmusttheAgencywaituntilthenextchangeismade?TopreventtherequirementthattheAgencyseekformaladministrativeapproval for largemodifications frombeingeffectively ignored, theAgencybelievesthisthresholdshouldbeunderstoodasa25%changebasedonthelastformallyapproved(i.e., through establishment or revision of the Plan via Commission’s Section 16‐111.5 approvalprocess)level.

Section 1‐75(c)(1)(M) of the Act requires that the Agency “consider stakeholder feedbackwhenmaking adjustments to the Adjustable Block design” and “notify stakeholders in advance of anyplannedchanges,”andtheAgencycommitstodoso,asdiscussedfurtherinChapter6.Likewise,thelawrequiresthat“[t]heAgencyanditsconsultantorconsultantsshallmonitorblockactivity,shareprogramactivitywithstakeholdersandconductregularlyscheduledmeetingstodiscussprogramactivity andmarket conditions.” Asdescribed further inChapter6, theAgencyplans tomonitorprogramperformancecloselyandshall seek tobeproactive incommunicatingwithstakeholdersaboutprogramperformanceandmakinganynecessarychangestothestructureoftheAdjustableBlockProgram.

10020ILCS3855/1‐75(c)(1)(L)(iii).10120ILCS3855/1‐75(c)(1)(K).10220ILCS3855/1‐75(c)(1)(M).


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2.5.2. CommunityRenewableGenerationProgramP.A.99‐0906alsocalls for theestablishmentofa “community renewablegenerationprogram.”103Unlike with the Adjustable Block Program, the law does not set forth procurement targets or aproposed contract structure for this program; the Agency thus understands that, legally, it haslatitude to design its Community Renewable Generation Program in any manner otherwiseconsistentwithstatelawanddone“withagoaltoexpandrenewableenergygeneratingfacilityaccesstoabroadergroupofenergyconsumers,toensurerobustparticipationopportunitiesforresidentialand small commercial customers and those who cannot install renewable energy on their ownproperties.”104

From the law, the exact interaction and structure between the Agency’s Community RenewableGeneration Program, and the portion of the Agency’s Adjustable Block Program set‐aside forcommunity solar, is unclear; the law simply references that “subscribed shares of photovoltaiccommunity renewable generation projects” shall be purchased through the Adjustable BlockProgram.105Thus,theIPAunderstandsthecommunitysolarportionofitsAdjustableBlockProgramtobesomethingofasubsetof itsCommunityRenewableGenerationProgram,withastandaloneCommunityRenewableGenerationProgramstillrequiredtobeestablishedtoprovidesupportforcommunityrenewablegenerationprojectsusingtechnologyotherthanphotovoltaics.

Along these lines, Section 1‐75(c)(1)(N) requires that “subscriptions” to community renewablegenerationprojectsunder theCommunityRenewableGenerationProgrammustbeportable (i.e.,retainedbythesubscriberevenifthesubscriberrelocatesorchangesitsaddresswithinthesameutility service territory) and transferable (i.e., a subscriber may assign or sell subscriptions toanother person within the same utility service territory). The Agency believes that theserequirementsapply tosubscriptions forcommunitysolarprojectsparticipating in theAdjustableBlockProgramaswell.

FurtherdiscussionoftheIPA’sCommunityRenewableGenerationProgramcanbefoundinChapter7.

2.6. IllinoisSolarforAllSetforthinSection1‐56(b)oftheIPAAct,theIllinoisSolarforAllProgramshall“includeincentivesforlow‐incomedistributedgenerationandcommunitysolarprojects,andotherassociatedapprovedexpenditures”inorder“tobringphotovoltaicstolow‐incomecommunitiesinthisStateinamannerthatmaximizesthedevelopmentofnewphotovoltaicgeneratingfacilities,tocreatealong‐term,low‐incomesolarmarketplacethroughoutthisState,tointegrate,throughinteractionwithstakeholders,with existing energy efficiency initiatives, and to minimize administrative costs.” Further, theprogramshallbe“designedtogrowthelow‐incomesolarmarket.”106

AnoverviewoftheIllinoisSolarforAllProgram,aswellastheindividualsub‐programsundertheIllinoisSolarforAllbanner,isbelow.

10320ILCS3855/1‐75(c)(1)(N).104Id.105Id.10620ILCS3855/1‐56(b)(2).


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2.6.1. IllinoisSolarforAll—OverviewAtitscore,theIllinoisSolarforAllProgramisanincentiveprogram—throughmoregenerousRECcontracts,theIllinoisSolarforAllProgramincentslow‐incomeparticipationinsolarphotovoltaicprojects,whetherasasystemowner,communitysolarprojectsubscriber,orsystemhost. ThoseRECs are retired to satisfy Section 1‐75(c) compliance obligations just as with the otherprocurementsandprogramsdescribedabove,whiletheadditionalpremiumhelpsproducebenefitsspecific togrowing the low‐incomesolarmarketplaceandensuringmoreequitable access to thebenefitsofcleanenergy.Thus,structurally,thelawenvisionstheSolarforAllProgram’sincentivebeing offered through contracts for the delivery of RECs at a premium price abovewhatwouldotherwise be available, reflecting the additional incentive necessary to ensure low‐incomeparticipation,withtheAgencyalsohavingtheabilitytoofferfullcontractprepaymentorotherwiserelax(orenhance)requirementsinrecognitionoftheuniquechallengesfacinglow‐incomeprojectdevelopment.

TheprogramfeaturesnohardtargetsorgoalsforthequantityofRECsrequiredtobeprocured,butdoes feature defined funding sources. First, Illinois Solar for All is funded through using theRenewable Energy Resources Fund. Unfortunately, at the time of the filing of this Plan forCommissionapproval(roughlythreemonthsaftertheunexpectedtransferof$150millionoutoftheRERF), the existing balance of the RERF is below the current balance of already‐committedcontractualobligations,andthe IPAconsidersanyexistingcontractualobligations fromtheRERF(specifically,SupplementalPhotovoltaicProcurementcontracts)tobeseniortoanynewobligationsenteredintothroughtheIllinoisSolarforAllProgram.107Statelaw108requiresthat$150millionbetransferredbackintotheRERFwithin24monthsofitstransferinAugust2017,butnoadditionalalternativecompliancepaymentsareduetobemadeintotheRERF.109

Second,IllinoisSolarforAllisfundedthroughaportionoffundscollectedbytheutilitiesundertheirSection16‐108(k)RPStariffsforpurchasesmadeunderSection1‐75(c)oftheIPAAct.UnderSection1‐75(c)(1)(O), “5% of the funds available under the plan for the applicable delivery year, or$10,000,000perdeliveryyear,whicheverisgreater”isavailableforIllinoisSolarforAllannuallyinmostyears;while“forthedeliveryyearsbeginningJune1,2017,June1,2021,andJune1,2025,thelong‐termrenewableresourcesprocurementplanshallallocate10%ofthefundsavailableundertheplanfortheapplicabledeliveryyear,or$20,000,000perdeliveryyear,whicheverisgreater”with$10 million in each of those three delivery years going toward funding ComEd’s workforcedevelopmentplan. Thismechanismensuresabaselevelof IllinoisSolarforAll fundingannually,whichiscrucialgiventheuncertaintysurroundingtheRERF.

Third,Section16‐108(k)ofthePUAcontainsthefollowingprovision:

If theamountof funds collectedduring thedeliveryyear commencing June1,2017,exceeds the costs incurred during that delivery year, then up to half of this excess

107ThisappearstobetheintentevidentinSection1‐56(b)aswell,asthatsectionprefacesthepercentage‐basedallocationofRERFfundswith thequalifier “moniesavailable in the IllinoisPowerAgencyRenewableEnergyResourcesFundandnototherwisecommitted tocontractsexecutedundersubsection(i)ofthisSection.”(emphasisadded)10830ILCS105/5h.5(b).109Section16‐115DofthePUAprovidesthatwhile“[t]hroughMay31,2017,allalternativecompliancepaymentsbyalternativeretailelectricsuppliersshallbedepositedintheIllinoisPowerAgencyRenewableEnergyResourcesFund,”“beginningwiththedeliveryyearcommencingJune1,2017,allalternativecompliancepaymentsbyalternativeretailelectricsuppliersshallberemittedtotheapplicableelectricutility”andnotdepositedintotheRERF.(220ILCS5/16‐115D(d)(4),(4.5).)Seealso83IllAdm.CodePart455.


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amount, as calculated on June 1, 2018,may be used to fund the programs undersubsection(b)ofSection1‐56oftheIllinoisPowerAgencyActinthesameproportiontheprogramsare fundedunder that subsection (b).However,anyamount identifiedunderthissubsection(k)tofundprogramsundersubsection(b)ofSection1‐56oftheIllinois Power Agency Act shall be reduced if it exceeds the funding shortfall. ForpurposesofthisSection,"fundingshortfall"meansthedifferencebetween$200,000,000and theamountappropriatedby theGeneralAssembly to the IllinoisPowerAgencyRenewableEnergyResourcesFundduringtheperiodthatcommencesontheeffectivedateofthisamendatoryactofthe99thGeneralAssemblyandendsonAugust1,2018.

SimilarprovisionsexistinSection16‐108(k)foreachofthedeliveryyearscommencingJune1,2018andJune1,2019,andthemeaningisunclear:thereisnosingle“amountappropriatedbytheGeneralAssembly to the Illinois Power Agency Renewable Energy Resources Fund” for the 14 monthsreferenced in theparagraphabove; instead, thereare threeseparate fiscalyearappropriations110coveredbythisperiod,oneofwhichiscurrentlyunknownandwillnotbeknownforsometime.Thelogic behind the provision is likewise unclear, as the Agency’s appropriation is merely itslegislatively‐grantedauthoritytospendanddoesnotreflectactualexpendituresmade—andthus,the“amountappropriated”isaslightlyawkwardmeasuringtoolfora“fundingshortfall.”

ShouldfundingforIllinoisSolarforAllbeavailable111underthismechanism(whileunstatedinthelaw, presumably for overcollections in the 2017‐2018 delivery year, although the Agencywouldreservetherighttodeveloparevisedprocurementplanshouldovercollectionsoccurin2018‐2019or2019‐2020),then“theAgencyshallsubmitaprocurementplantotheCommissionnolaterthanSeptember1,2018,thatproposeshowtheAgencywillprocureprogramsonbehalfoftheapplicableutility.”112TheCommissionwouldhaveuntilNovember1,2018toapproveanysuchPlan.

Under the Illinois Solar forAllProgram,payments “shall be in exchange for an assignmentof allrenewableenergycreditsgeneratedbythesystemduringthefirst15yearsofoperationandshallbestructured to overcome barriers to participation in the solar market by the low‐incomecommunity.”113 The contract “may pay for such renewable energy credits through an upfrontpaymentperinstalledkilowattofnameplatecapacitypaidoncethedeviceisinterconnectedatthedistributionsystemleveloftheutilityandisenergized,”givingtheAgencyflexibilityinproposingcontractstructures.114

ThecounterpartytoIllinoisSolarforAllcontractsenteredintousingRERFfundsistheAgency,whilethecounterpartytocontractsenteredintousingutilityfundsistheapplicableutility.

110ThesearetheappropriationsforFiscalYear2017(July1,2016throughJune30,2017),FiscalYear2018(July1,2017throughJune30,2017),andFiscalYear2019(July1,2018throughJune30,2019).111Followingeachofthe2017‐2018,2018‐2019,and2019‐2020deliveryyears,theAgencywillaskeachofComEd,AmerenIllinois,andMidAmericantoprovideanaccountingoftheutility’sRPSridercollectionsduringtheprecedingdeliveryyearandthecostsitincurredforSection1‐75(c)contractsduringthatdeliveryyear.112 20 ILCS3855/1‐56(b)(7). Perhapsnotably,while the requirement that the IPA submit aPlan isprescriptive, Section16‐108(k)’sfundingallocationlanguageismerely“permissive”(“uptohalfthisexcessamount...maybeusedtofundtheprograms”).TheIPAthusneednotpropose,andtheCommissionneednotapprove,afull(orany)statutorilyauthorizedallocation. InpreparingitsSection16‐108(k)Plan,theIPAplanstoexaminetheavailabilityandsufficiencyofexistingRERFfundsandSolarforAllprograminterestanduptakebeforeofferingitsrecommendationforafundingallocation.11320ILCS3855/1‐56(b)(3).114Id.


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InadditiontopaymentsforRECdeliverycontracts,thelawprovidesthat“[t]heAgencyshallensurecollaborationwithcommunityagencies,andallocateupto5%ofthefundsavailableundertheIllinoisSolarforAllProgramtocommunity‐basedgroupstoassistingrassrootseducationeffortsrelatedtotheIllinoisSolarforAllProgram.”115 Notably,forgrassrootseducationefforts,thisamountisnotbasedonlyonthebalanceoftheRERF;itisinstead“upto5%ofthefundsavailableundertheIllinoisSolarforAllProgram,”andthusalsoinclusiveofanySection1‐75(c)or16‐108(k)funds.Inadditionto grassroots education, “costs associatedwith procuring experts, consultants, and the programadministrator...andrelatedincrementalcosts,andcostsrelatedtotheevaluationoftheIllinoisSolarforAllProgram”maybepaidoutoftheRERF.

2.6.2. IllinoisSolarforAll—Sub‐programsIllinoisSolarforAllisdesignedtoincentspecificdefinedprojecttypes,andtothisend,IllinoisSolarforAll features four sub‐programswith percentage‐based Fundbalance allocations applicable toeach.Notably,theAgencyunderstandsthesepercentage‐basedallocationstobeapplicableonlytoRERFfunds,andnottofundscollectedbytheutilitiesbutavailableforIllinoisSolarforAlluse(asthe law uses the phrasing “monies available in the Illinois Power Agency Renewable EnergyResources Fund”116 in making those percentage‐based assignments). For the first three sub‐programs,theseallocationsmaybechangedif,afterstakeholderinputthroughastakeholderprocess,theAgencyoritsadministratordeterminesthatincentivesforanythosethreesubprograms“havenot been adequately subscribed to fully utilize the Illinois Power Agency Renewable EnergyResourcesFund.”117

Thefirstthreesub‐programsalsocontain“agoal...thataminimumof25%oftheincentivesforthisprogrambeallocatedtocommunityphotovoltaicprojectsinenvironmentaljusticecommunities.”118TheAgency’sdefinitionofferedtotheterm“environmentaljusticecommunity”isdiscussedfurtherinChapter8.

Discussionofthefoursub‐programsisbelow.Inadditiontothesefoursub‐programs,“apartymayproposeanadditionallow‐incomesolarorsolarincentiveprogram,ormodificationstotheprogramsproposed” and that additional program or modification will be approved “if the additional ormodifiedprogrammoreeffectivelymaximizesthebenefitstolow‐incomecustomersaftertakingintoaccountallrelevantfactors,including,butnotlimitedto,theextenttowhichacompetitivemarketforlow‐incomesolarhasdeveloped.”119

2.6.2.1. Low‐IncomeDistributedGenerationIncentive

This sub‐program “provide incentives to low‐income customers, either directly or through solarproviders,toincreasetheparticipationoflow‐incomehouseholdsinphotovoltaicon‐sitedistributedgeneration.”120 Usedforthissub‐programandothers, theterm“solarprovider” isundefinedandunclear;forpurposesofallowingthemarkettodetermineappropriatemodels,theAgencybelieves

115Id.11620ILCS3855/1‐56(b)(2).117Id.11820ILCS3855/1‐56(b)(2)(A),(B),(C).11920ILCS3855/1‐56(b)(4).12020ILCS3855/1‐56(b)(2)(A).


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that “solar providers” can refer to any entitywhich has a contractual relationshipwith the low‐incomecustomer inconnectionwith theunderlyingphotovoltaic system(whether in the formofpurchase,leasing,installation,aggregation,orfinancing).

Thisprogramcontainsafirm,unequivocalcommitmenttousingjobtrainees;thelawprovidesthat“companiesparticipatinginthisprogramthatinstallsolarpanelsshallcommittohiringjobtraineesforaportionoftheirlow‐incomeinstallations,”121althoughtheterm“portion”isundefinedinthelaw. Nevertheless,theIPAbelievesthat“portion”shouldnotbeunderstoodastoosmalltobedeminimis,nor too large tobea “majority” (a termwhich likelywouldhavebeenusedhad itbeenintended).

For this sub‐program, the law also requires that “an administrator shall facilitate partnering thecompaniesthatinstallsolarpanelswithentitiesthatprovidesolarpanelinstallationjobtraining.”122The IPA understands this to mean its third‐party Program Administrator engaging in suchfacilitation,andcommitstohavingitsProgramAdministratordothesame.

Thelawalsoincludesaprovisionthat“[c]ontractsenteredintounderthisparagraphmaybeenteredintowithanentitythatwilldevelopandadministertheprogram,”123althoughitispresentlyunclearhowtheadministratorcouldleveragestatefundsforthisuse.

Thissub‐programisallocated22.5%ofavailableRERFfunds.

2.6.2.2. Low‐IncomeCommunitySolarProjectInitiative

Through the low‐incomecommunity solarproject initiative, “[i]ncentivesshallbeoffered to low‐incomecustomers,eitherdirectlyorthroughdevelopers,toincreasetheparticipationoflow‐incomesubscribersofcommunitysolarprojects.”124Again,theterm“developer”isundefined;ascommunitysolarprojectsubscriptionsmaybeactivelymarketedbyentitiesotherthantheliteraldefinitionofphotovoltaic project “developers,” it is unclear whether this phrasing is intended to include allentities marketing such subscriptions or only the project’s actual developer. The Agency willinterpret“developer”tobeanApprovedVendorortheirprojectpartner.

A requirement of this program is that each participating project’s developer “shall identify itspartnershipwithcommunitystakeholdersregardingthelocation,development,andparticipationinthe project.”125 Unclear from this phrasing is what constitutes a “community stakeholder,” orwhethertheprojectitselfmustinclude“communitystakeholders”fromthecommunityinwhichtheproject is located (presumably so), the community of any subscribers (unclear), or both (alsounclear).

Thelawfurtherprovidesthat“[i]ncentivesshouldalsobeofferedtocommunitysolarprojectsthatare 100% low‐income subscriber owned, which includes low‐income households, not‐for‐profitorganizations,andaffordablehousingowners.”126Thisphrasingleavesprogrameligibilityunclear—

121Id.122Id.123Id.12420ILCS3855/1‐56(b)(2)(B).125Id.126Id.


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mustallsubscribersbe“low‐income”foreligibility,or—asthelawusestheterm“also”indesignating100% low‐income projects for eligibility—only a portion (and if so, what portion)? Not allsubscriptions are “ownership”; does ownership matter, and should it result in a heightenedincentive?Thesequestionshavenoobviousanswer,andthephrasingistooambiguoustorevealanyclearintent.

Thelawalsoprovidesthat“[c]ontractsenteredintounderthisparagraphmaybeenteredintowithdevelopers,”127 which the IPA understands to mean that a project developer, upon a sufficientshowingoflow‐incomeparticipation,mayqualifyforacontractaward.

Thissub‐programisallocated37.5%ofavailableRERFfunds.

2.6.2.3. IncentivesforNon‐profitsandPublicFacilities

The third sub‐program provides that funding “shall be used to support on‐site photovoltaicdistributed renewable energy generationdevices to serve the load associatedwithnot‐for‐profitcustomers and to support photovoltaic distributed renewable energy generation that usesphotovoltaictechnologytoservetheloadassociatedwithpublicsectorcustomerstakingserviceatpublicbuildings.”128Stateddifferently,theprogramoperatessimilarlytothefirstsub‐program—anincentive for on‐site DG through a higher‐priced REC contract—only with different eligibilityrequirements (not‐for‐profit customers and public sector customers taking service at publicbuildings).

Thisraisesthequestionofwhetherallnon‐profitsandallpublicsectorentitiesmayqualifyforthesub‐program,orwhethersomenexuswiththebroader“low‐income”intentofIllinoisSolarforAllisrequired. As the lawprovidesvery specific thresholds (suchas25% fromenvironmental justicecommunities)whenaspecificthresholdisintended,theIPAbelievesthatthelawmayprovideforparticipationfromallnon‐profitandpublicsectorcustomerstakingserviceatpublicbuildings,butbelievesthatsomelevelofcommunityinvolvementmayberequiredtomaintainconsistencywiththespiritofthelaw(asdiscussedfurtherinChapter8).

This sub‐programalso combined referencedelementsof eachof thepriorprograms, stating that“[c]ontractsmaybeenteredintowithanentitythatwilldevelopandadministertheprogramorwithdevelopers,”129whichcarriessimilarchallengesandopenquestionstothosereferencedabove.

Thissub‐programisallocated15%ofavailableRERFfunds.

2.6.2.4. Low‐IncomeCommunitySolarPilotProjects

The fourthsub‐programallows that “persons, including,butnot limited to,electricutilities, shallproposepilotcommunitysolarprojects.”130 Suchprojectsareallowedby lawtobe larger than2megawatts (“MW”), but “the amount paid per project under this program may not exceed$20,000,000.”131Suchprojects“mustresultineconomicbenefitsforthemembersofthecommunity

127Id.12820ILCS3855/1‐56(b)(2)(C).129Id.13020ILCS3855/1‐56(b)(2)(D).131Id.


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inwhichtheprojectwillbelocated”and“mustincludeapartnershipwithatleastonecommunity‐basedorganization”(withthattermagainundefined).132

Beyondtheallowancethattheprojectmaybeproposedbyanelectricutilityandmaybelargerthanthe lawotherwiseallows, it isnotclearwhatotherrequirementsmakesuch facilitiessufficientlydistinctsoastobeconsidereda“pilotproject.”Whileitmaybetemptingtorequiredemonstrationof innovation through this program, the IPA does not believe that any additional limitations orconditionsonsuchprojectsshouldbeinferred.

While the manner through which contracts are entered into in the other subprograms is notestablished in the statute, the low‐income community solar pilot project sub‐program must be“competitively bid by the Agency,” which the Agency understands to be consistent with theprocurementrequirementsofSection16‐111.5ofthePUAwhereapplicable.

Thelawfurtherprovidesthatfundingunderthissub‐program“maynotbedistributedsolelytoautility,”andthatsomefunds“mustincludeaprojectpartnershipthatincludescommunityownershipbytheprojectsubscribers.”TheIPAthusunderstandsthat,forbidselectionpurposes,disbursementtoanentityotherthanautilityisaprerequisiteforautilitybidtowin,whilesatisfyingthereferencedpartnershipthroughawinningbidisaprerequisiteforanyotherbidtowin.

ThelawprovidesthatcontractsundertheLow‐IncomeCommunitySolarPilotProjectprogram“maybeenteredintowithanentitythatwilldevelopandadministertheprogramorwithdevelopers.”133

Thissub‐programisallocated25%ofavailableRERFfunds.

2.6.3. IllinoisSolarforAll—AdditionalRequirementsSection1‐56(b)alsoprovidesthatunderIllinoisSolarforAll,“[e]achcontractthatprovidesfortheinstallationofsolarfacilitiesshallprovidethatthesolarfacilitieswillproduceenergyandeconomicbenefits, at a level determined by theAgency to be reasonable, for the participating low incomecustomer.”134TheAgencybelievesthatthisrequirementisinpartmetthroughthepremiumattachedto the REC price under Illinois Solar for All (and “energy benefits” for community solar anddistributedgenerationprojectsarealreadyhandledthoughbillcreditingandnetmeteringprovisionsoverwhichtheAgencylacksjurisdiction),andprovidessupportforconsumerprotectionstoensurethatlowincomecustomersindeedreceivebenefitsinenteringintocontractualarrangementswithinstallers,projectdevelopers,aggregators,orotherintermediaries.

IllinoisSolarforAllcontractsmustalso“ensurethewholesalemarketvalueoftheenergyiscreditedtoparticipatinglow‐incomecustomersororganizations,”135which,again,isanissuehandledthroughnetmetering,butcanbeemphasizedinresultingcontracts.Contractsmustalsoensurethat“tangibleeconomicbenefits flowdirectly toprogramparticipants, except in the caseof low‐incomemulti‐family housingwhere the low‐income customer does not directly pay for energy;”136 while it isunclearwhatconstitutesa“tangibleeconomicbenefit”(or,forthatmatter,a“programparticipant,”especiallyiftheunderlyingcontractiswithaprojectdeveloperorothersuchentity).thislanguage132Id.13320ILCS3855/1‐56(b)(2)(D).13420ILCS3855/1‐56(b)(2).135Id.136Id.


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appearstoprovidefurthersupportforensuringthatmarketingpracticesarestandardizedsuchthatlow‐income customers receive clear, standardized information about the benefits to be expectedfromanIllinoisSolarforAllproject.

Thelawalsoseeksforprioritytobegiventoprojectsthat“demonstratemeaningfulinvolvementoflow‐incomecommunitymembersindesigningtheinitialproposal.”137Hereagain,thelawprovidesnodefinitionof“meaningful involvement”nordoes itdefinea“low‐incomecommunitymember,”anditisunclearwhetherthiswouldbedistinctfroman“environmentaljusticecommunity”orwhatconstitutes a community “member.” The law further provides that “[a]cceptable proposals toimplementprojectsmustdemonstratetheapplicant'sabilitytoconductinitialcommunityoutreach,education, and recruitment of low‐income participants in the community;” again, the term“participantsinthecommunity”isundefinedandentirelyunclear,buttheAgencydoesunderstandthis language as providing that entities seeking to market installations or community solarsubscriptionsusingIllinoisSolarforAllcontractsmust,ataminimum,becertifiedbytheAgencyandpossess some baseline level of demonstrated competency. The Agency’s approach to vendorcertificationisdiscussedfurtherinChapter6.

As growing the low‐income solarmarket involvesmore than justRECdelivery contractsmakingphotovoltaics more economic, the law also requires that projects “must include job trainingopportunitiesifavailable,”andseeksthatsuchjobtrainingopportunitiesshouldbeeffectedthroughcoordinationwiththejobtrainingprogramsproposedinComEd’sWorkforceDevelopmentPlan.TheAgency’sapproachtoencouragingthatprojectsusejobtraineestohelpbuildthelow‐incomesolarmarketplaceisdiscussedfurtherinChapter8.

2.6.4. IllinoisSolarforAll—Third‐partyprogramadministratorToassisttheAgencyinitsadministrationoftheIllinoisSolarforAllProgram,theAgencymayretainathird‐partyprogramadministrator(oradministrators)throughaRequestForQualificationsandcompetitivebidprocess.Theselectioncriteriaandrequirementsmustinclude,butarenotlimitedto,“experienceinadministeringlow‐incomeenergyprogramsandoverseeingstatewidecleanenergyorenergyefficiencyservices.”

AsbothitsIllinoisSolarforAllthird‐partyprogramadministratorandthe“expertconsultingfirms”toassistwithimplementingandoperatingtheAdjustableBlockProgrammerely“may”beretained,the Agency understands that it could, in theory, use the same entity to assist it with theimplementationofbothprograms(andisnotprohibitedfromusingeitherthird‐partyadministratortoassistitwiththeimplementationoftheCommunityRenewableGenerationProgram).

137Id.


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3. RPSGoals,Targets,andBudgetsTheoriginalIllinoisRenewablePortfolioStandardwasestablishedin2007throughPublicAct95‐0481andbecameeffectiveonJune1,2008.ThatRPSsetannualpercentagegoalsrelativetoeligibleretailloadsinthestatefortheprocurementofrenewableresources,startingwithatleast2%bythebeginningofthe2008‐2009deliveryyearandrisingto25%bythe2025‐2026deliveryyear.138Thesegoalsinitiallyappliedonlytotheloadassociatedwitheligibleretailcustomers—theresidentialandsmallcommercialcustomerswhoreceivefixed‐pricebundledservicefromtheutilities,ratherthanswitchingtohourlypricedserviceortoservicefromanAlternativeRetailElectricSupplier.In2009,PublicAct96‐0033addedSection16‐115DtothePublicUtilitiesAct,whichcreatedRPSobligationsforARES.TheARESRPSgoalswerebasedonthequantityofmeteredelectricitydeliveredbytheAREStoretailcustomersinIllinois.

P.A.99‐0906revisedtheRPStoapplythegoalstoallretailcustomersandtophaseouttheAREScomplianceobligationsoveratwo‐yearperiodterminatingonMay31,2019(seeSection3.2formoreinformation).TheserevisionsalsoconsolidatetheRPSintoasingle,centralizedplanningmechanismforprocurementsandprogramsasdescribedinthisPlan.Significantly,therevisionstotheRPSshiftthe focus fromtheprocurementofrenewableenergyresourcestotheprocurementofrenewableenergycreditsorRECs.139

The revisions to the RPS include a number of REC procurement goals and targets. The Agencyconsidersa“goal”tobeanoverallpercentageofloadtobeprocuredintheformofRECsforagivenyear based upon that year’smandated RPS requirement.140 A “target,” on the other hand, is thenumber of RECs for a specific procurement event or program based upon the specific goal ornumericalmandate.

UnderthechangestotheRPSmadeviaP.A.99‐0906,theannualRPSpercentagegoalremainsthesameas inP.A.95‐0481—13% in the2017deliveryyear, rising incrementallyby1.5percentagepointsannuallyto25%by2025—butthisgoalwillnowbeappliedtoallretailelectricitysalesratherthansaleslimitedtoeligibleretailcustomers.MeetingtheRPSgoalsoftheActstartswiththeneedto procure an additional 7.5 million RECs for the 2017‐2018 delivery year, increasing to theforecastedprocurementof27.5millionRECsforthe2030‐2031deliveryyear.

Inaddition,whilestayingwithinthemandatedgoals,specificRECtargetscallforvariousquantitiesofRECstobeprocuredinincreasingstepsstartingwiththe2017‐2018deliveryyearthroughtheendofthe2030‐2031deliveryyear,including:

1,000,000newwindand1,000,000newsolarRECstobedeliveredannually(withdeliverybeginningnoearlierthanJune1,2019,andno laterthan June1,2021) thatareprocuredthroughtheInitialForwardProcurementconductedseparatelyfromthisPlan;and

Atotalof2,000,000RECsannuallyeachfromnewwindandnewphotovoltaicprojectsbytheendofthe2020‐2021deliveryyear,rampingupto3,000,000annuallyeachfromnewwindand new photovoltaic projects by the end of the 2025‐2026 delivery year, and reaching

138220ILCS5/16‐111.5(a)13920ILCS3855/1‐75(c)(1)(B).140Forexample,theRPS“goal”forthe2020‐2021deliveryyearis17.5%oftheretailload.


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4,000,000RECsannuallyeachfromnewwindandnewphotovoltaicprojectsbytheendof2030‐2031.(RECsfromtheInitialForwardProcurementcounttowardthesetargets.)

ThisChaptercontainscalculationsofRPStargets,summariesofRPSportfolios,andsummariesofRPSbudgets.AdditionaldetailsareavailableinAppendixB.

3.1. StatewideGoalsandAllocationofCostandRECs fromRPSProcurements to

EachUtilitySpecific numerical targets included in the Act are statewide targets which do not specifyindividualizedRECtargetsforeachutility.TheAgencythusproposestoconducttheprocurementofRECsunderthisPlanbasedonstatewideRPSgoalsandtargets,ratherthanviewingthosetargetsbyutility. The cost of the RECs associatedwith RPS procurementswill be allocated to each utility,throughRECprocurement contracts thatare specific to theapplicableutilityand independentofsupplierperformanceunderotherutilities’ contracts,basedoneachutility’sRenewablePortfolioStandardBudget(“RPSBudget”);Table3‐1showstheproposedallocation.141

Table3‐1:UtilityRECCostAllocations

UtilityReferenceYearForecastedDeliveredVolume(MWh)142

CostCapRate143($/MWh)

RPSBudgetfor2020‐2021DeliveryYear($)144

AllocationBasedonRPSBudgetfor2020‐2021DeliveryYear(%)

AmerenIllinois 38,017,110 1.8054 68,636,091 29.33%ComEd 87,012,436 1.8917 164,601,426 70.34%MidAmerican* 616,844 1.2415 765,812 0.33%

*LoadcoveredbyIPAprocurements

Thismeansthatforevery$1,000,000ofcostincurredtoprocureRECs,$293,300andassociatedRECcontractswouldbeallocatedtoAmerenIllinois,$703,400andassociatedRECstoComEd,and$3,300andassociatedRECstoMidAmerican.TheIPAplanstoreviewandupdatethisallocationinitsnextPlanin2019.

141ThisallocationmethodwasinitiallydevelopedtoallocatetheRECsfromtheAugust31,2017InitialForwardProcurementandwasbasedontheRPSBudgetfor2020‐2021,whichusestheprioryeardeliveredvolumesasreference.The2019‐2020referencedeliveryyearwasusedbecauseitwillbethefirstyearwhenallload,includingthatservedbyARES,willbeundertheIPA’sRECprocurements,thusmakingtheresultingRPSBudgetabetterrepresentationoffutureRPSBudgets.AsshowninTable3‐1,theallocationtoeachutilityisbasedontheutility’sshareofthe2020‐2021deliveryyearRPSBudget.AsnotedinChapter6,thesameallocationwillbeusedfortheAdjustableBlockProgramprocurementstoeachutility.142The2019‐2020deliveryyearisthereferenceyearforthe2020‐2021deliveryyear.143TheCostCapRate foreachutility isdefined inSection1‐75(c)(1)(F)of theActas “thegreaterof2.015%of theamountpaidperkilowatthourby[eligibleretail]customersduringtheyearendingMay31,2007ortheincrementalamountperkilowatthourpaidfortheseresourcesin2011.”2.015%ofthebundledpricepaidperkWhbyeligibleretailcustomersinthe2006‐2007deliveryyearwas0.18054cents forAmeren Illinois, 0.18917 cents forComEd, and0.12415 cents forMidAmerican. The incremental amountperkWhpaid forrenewableresourcesin2011was0.00584centsforAmerenIllinois,and0.0057centsforComEd.MidAmericandidnotparticipateinIPA‐administeredrenewableenergyprocurementsin2011;therefore,itdidnothaveanincrementalamountforthatyear.144Beginningwiththe2019‐2020deliveryyear,theRPSBudgetforeachutilityiscalculatedbymultiplyingthevaluesoftheprecedingtwocolumns of the table, as specified by Section 1‐75(c)(1)(F) of the Act (“To arrive at amaximumdollar amount of renewable energyresourcestobeprocuredfortheparticulardeliveryyear,theresultingperkilowatthouramountshallbeappliedtotheactualamountofkilowatthoursofelectricitydelivered[…]by theelectricutility in thedeliveryyear immediatelyprior to theprocurement toall retailcustomersinitsserviceterritory.”).


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3.2. ImpactofthePhaseoutofAlternativeRetailElectricSupplierRPSObligationsP.A.99‐0906resulted inchanges to therequirements forARESRPScompliance.Prior to theRPSrevisionscontainedinSection16‐115DofthePublicUtilitiesAct,AREScouldmeettheircompliancerequirements through Alternative Compliance Payments or through a combination of ACPs,generation using eligible renewable resources, purchasing electricity generated using eligiblerenewableresources,andpurchasingRECs.Amaximumof50%oftheARESrequirementscouldbemetwithself‐procurementorgeneration,whileACPscouldaccountforaminimumof50%uptoamaximumof100%oftherequirements.Ingeneralpractice,theAREStendedtowardtheuseoftheminimum50%ACPrequirement,relyingontheprocurementofeligiblerenewableenergyresourcestomeet the remaining compliance requirement. In order to be eligible forARES compliance, therenewableresourcesproducingtheRECscouldbe located inIllinois,statesthatadjoinIllinois,orwithintheU.S.footprintsofPJMorMISO.145

UnderthenewRPSrequirements,afteratwo‐yeartransitionperiod,theIPAwillberesponsibleforprocuring RECs for virtually all retail load in Illinois, including load served byARES. During thetransition period, the REC quantity associated with ARES load to be covered by the Agency’sprogramsandprocurementswillbebasedon50%ofARESloadforthe2017‐2018deliveryyear,75%forthe2018‐2019deliveryyear,and100%foreachdeliveryyearthereafter.146

Starting with the 2017‐2018 delivery year, ARES will have to certify that the RECs used forcompliance were not produced by facilities whose costs were being recovered through ratesregulatedbyanystateorstatesonorafterJanuary1,2017.147Startingwiththe2019‐2020deliveryyearandcontinuingforsubsequentdeliveryyears,ARESdonothaveanobligationtoprocureRECsormakeACPsforRPScompliance.

The impact of the ARES RPS compliance obligations phase out is that the volume of RECs to beprocuredbytheIPAincreasessignificantly.

3.3. Section1‐75(c)(1)(H)(i)ARESOptiontoSupplyRECsfortheirRetailCustomersSection1‐75(c)(1)(H)of theActprovidesanexception to thephaseoutofARESRPSobligationsdescribedinSection3.2.Underthisexception,anAREScoulduseself‐suppliedRECstomeetaportion(andpossiblyall)ofitsRECrequirements.Todoso,theAREShadtofirstmakeaninformationalfilingto the ICCwithin 45 days of the effective date of Public Act 99‐0906, indicating that it owned ageneratingfacilityorfacilitiesasofDecember31,2015,thatproducedRECseligibletomeettheRPS,providedthatthosefacilitieswerenotpoweredbywindorsolarphotovoltaics.TheARESmustalsonotifytheAgencyandtheapplicableutilitybyFebruary28ofeachyearofitselectiontosupplyRECstoitsretailcustomersandincludetheamountofRECstobesupplied.

OneARESinformationalfilingcoveringanownedgenerationfacilityoutsideofIllinoiswassubmittedonaconfidentialbasistotheICCbythedeadlineofJuly15,2017.

Section1‐75(c)(1)(H)oftheActprovidesthattheprocurementofrenewableenergyresourcesforagivenyearshallbereducediftheARESusesRECsfromanARES‐ownedgenerationfacilitytosupply

145MISOalsoincludestheCanadianprovinceofManitoba,aswellaspartsorallofseveralU.S.states.14620ILCS3855/1‐75(c)(1)(B).14783Ill.Adm.Code§455.120(b)(4).


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itsretailcustomers.TheamountofRECsthatcanbesuppliedbyARES‐owned/generationissubjecttoseverallimitations.Specifically,theActprovidesthat:

“For the delivery year beginning June 1, 2018, themaximum amount of renewableenergy credits to be supplied by an alternative retail electric supplier under thissubparagraph(H)shallbe68%multipliedby25%multipliedby14.5%multipliedbytheamountofmeteredelectricity(megawatt‐hours)deliveredbythealternativeretailelectric supplier to Illinois retailcustomersduring thedeliveryyearendingMay31,2016.”148

“Fordelivery yearsbeginning June1,2019and each year thereafter, themaximumamount of renewable energy credits to be supplied by an alternative retail electricsupplierunder thissubparagraph (H) shallbe68%multipliedby50%multipliedby16%multipliedbytheamountofmeteredelectricity(megawatt‐hours)deliveredbythealternativeretailelectricsuppliertoIllinoisretailcustomersduringthedeliveryyearendingMay31,2016,providedthatthe16%valueshallincreaseby1.5%eachdeliveryyearthereafterto25%bythedeliveryyearbeginningJune1,2025,andthereafterthe25%valueshallapplytoeachdeliveryyear.”149

TheActlimitsthetotalamountofRECsthatcanbesuppliedbyallARESthroughownedgeneration:

“Foreachdeliveryyear,thetotalamountofrenewableenergycreditssuppliedbyallalternativeretailelectricsuppliersshallnotexceed9%oftheIllinoistargetrenewableenergy credit quantity.The Illinois target renewable energy credit quantity for thedeliveryyearbeginningJune1,2018is14.5%multipliedbythetotalamountofmeteredelectricity(megawatt‐hours)deliveredinthedeliveryyearimmediatelyprecedingthatdelivery year, provided that the 14.5% shall increase by 1.5% each delivery yearthereafterto25%bythedeliveryyearbeginningJune1,2025,andthereafterthe25%valueshallapplytoeachdeliveryyear.”150

Inordertotakeintoaccounttheself‐supplybytheARES,theActrequiresthatthechargeswhichareapplicabletotheretailcustomersoftheARESbereducedbytheratiooftheRECssuppliedbytheAREStotheARES’sRPStarget.Specifically,theActstatesthat:

“Iftherequirementssetforthinitems(i)through(iii)ofthissubparagraph(H)aremet,thechargesthatwouldotherwisebeapplicabletotheretailcustomersofthealternativeretail electric supplierunderparagraph (6)of this subsection (c) for theapplicabledeliveryyearshallbereducedbytheratioofthequantityofrenewableenergycreditssuppliedbythealternativeretailelectricsuppliercomparedtothatsupplier'stargetrenewable energy credit quantity. The supplier's target renewable energy creditquantityforthedeliveryyearbeginningJune1,2018is14.5%multipliedbythetotalamount ofmetered electricity (megawatt‐hours) delivered by the alternative retailsupplier in thatdelivery year,provided that the14.5% shall increaseby1.5% each

14820ILCS3855/1‐75(c)(1)(H)(iii).149Id.150Id.


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delivery year thereafter to 25% by the delivery year beginning June 1, 2025, andthereafterthe25%valueshallapplytoeachdeliveryyear.”151

TheAgencywillpostonitswebsitebyApril1ofeachyearareportontheaggregatenumberofRECsbeingsuppliedbytheARES for theupcomingdeliveryyear,starting June1.Thisquantitywillbeaccounted asRECs from “other technologies” (i.e., other thanwindor solar) andwill reduce theoverallRPSTargetforthatdeliveryyear.Thosetargetsareshown(unadjusted)inTable3‐10.

3.4. MidAmericanVolumesMidAmerican’s status as amulti‐jurisdictional utilitywhichuses its own generating resources tomeet a portion of its Illinois load creates a unique situation for RPS compliance. Unlike AmerenIllinoisandComEd,forwhichallretailloadissubjecttotheRPSgoalsandtargets,theMidAmericanload forwhichtheRPSgoalsandtargetsareapplicable isonly the loadthat issubject to the IPAprocurement process for conventional power. That amount is the load which is in excess ofMidAmerican’sIllinois‐allocatedgenerationinanygivendeliveryyear,whichisapproximatelyonly25‐35%ofitstotaljurisdictionalload.152

ToaccountforthetransitionfromtheRPSpreviouslyapplicableonlytoeligibleretailcustomerloadtotheRPSnowbeingapplicabletoallretailsales(includingthosemadebyARES),MidAmerican’stargetsandbudgetswillbecalculatedalsotoincludetheshareofARESloadinMidAmerican’sservicearea.TheARESloadwillbeproratedbyanamountequaltotheshareofMidAmerican’ssupplyloadcoveredbytheIPAenergyprocurementprocess,thesamediscountappliedtoMidAmerican’snonARES‐suppliedload,andfurtheradjustedby50%forthe2017‐2018deliveryyear,and75%forthe2018‐2019deliveryyear,toaccountfortheARESloadtransitionperiod.153

Asaconsequence,thenumberofRECstobeprocuredforMidAmericanisaverysmallportionofthetotalnumberofRECstobeprocuredstatewide.BasedonthedatapresentedinTable3‐1,forthe2017‐2018through2020‐2021period,MidAmerican’sapplicableretailloadisapproximately0.55%ofthestatewideapplicableload.

3.5. CostCapandCostRecoveryTheIPA’sprocurementofRECsissubjecttomonetarylimitationsintheformofacostcapbasedonlimitingtheannualaveragenetincreasetoalleligibleretailcustomersto“nomorethanthegreaterof2.015%oftheamountpaidperkilowatt‐hourbythosecustomersduringtheyearendingMay31,2007ortheincrementalamountperkilowatt‐hourpaidfortheseresourcesin2011.”154ThecostcapdeterminedunderthesecriteriaisunchangedfromthepriorRPScostcap;however,itisnowappliedto the actual quantity of electricity delivered in the prior delivery year to all applicable retail

151Id.152TheCommissionspecifiedthisapproachfortheprocurementofrenewableresourcestomeettheRPScompliancetargetsapplicabletoMidAmerican in Docket No. 15‐0541, determining that only the portion of MidAmerican’s load subject to the IPA’s planning andprocurementprocessissubjecttoSection1‐75(c)oftheAct’srequirements.153TablesinthisPlandonotyetreflecttheARESshareofMidAmerican’sretailload.TheAgencywillupdateMidAmericanRECtargetsandbudgetsbasedonupdatedloadforecastsfromMidAmericanwhichincludeARESload.15420ILCS3855/1‐75(c)(1)(E).


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customersintheutility’sserviceterritory.155Thecostcaprate,incentsperkilowatt‐hour,isprovidedinTable3‐2.

Table3‐2.RECProcurementCostCapRatebyUtility156

Utility RPSCostCapRate(¢/kWh)

AmerenIllinois 0.18054

ComEd 0.18917

MidAmerican 0.12415

Each utility is entitled to recover the costs of the RECs procured to meet the RPS compliancerequirements,subjecttothecostcaplimitations,alongwith“…thereasonablecoststhattheutilityincursaspartoftheprocurementprocessandtoimplementandcomplywithplansandprocessesapprovedbytheCommission…”157

Beginningwith the2017‐2018deliveryyear, theutilitieswillbeable torecoverallof theircostsassociatedwiththeRECspreviouslyprocuredandprocuredthroughtheimplementationoftheIPA’slong‐termrenewable resourceprocurementplans through tariffs applicable to all of theutilities’customers.ThesetariffstookeffectasoftheJune2017billingperiodandwillallowcollectionsbyutilities to recover the costsofRECsprocuredby the IPA.TheCommissionwill conduct a singlereview,reconciliationandtrue‐upoftheutility’scollectionscoveringRECcostsforthe2017‐2018,2018‐2019,2019‐2020,and2020‐2021deliveryyearsnoearlierthanAugust31,2021.Subjecttolimits (discussed inChapters2 and8of thisPlan)basedon any shortfall of funding to the IPA’sRenewableEnergyResourcesFund,aportionofanyover‐collection,uptohalf,willbeusedtofundtheIllinoisSolarforAllProgram.ThisfundingfortheIllinoisSolarforAllProgramwillnotreducetheoverallRPSBudget.

3.6. RPSComplianceProcurementPrioritiesTheActprovidesguidelines forprioritizing theRECprocurements in theevent that the cost caplimitations conflict with the RPS goals and targets such that the IPA cannot procure sufficientadditionalquantitiesofRECstomeetgoalsortargets.158TheseprioritiesregardingtheprocurementofRECstakethefollowingorder,arrangedbasedondescendingpriority:

RECsprocuredunderexistingcontracts; RECsprocuredwithfundingfortheIllinoisSolarforAllProgram; RECs procured to comply with the new wind and solar photovoltaic procurement

requirements; RECsprocuredtomeettheremainingRPStargets(RECGap).

155Id.156 These figures are the same used in the IPA’s 2017 Electricity Procurement Plan approved by the Commission. See:https://www.illinois.gov/sites/ipa/Documents/2017ProcurementPlan/2017‐IPA‐Procurement‐Plan.pdfat12.157220ILCS5/16‐108(k).15820ILCS3855/1‐75(c)(1)(F).


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Basedonthelistabove,theprocurementofRECsunderexistingcontractualobligationswillhavethehighest priority,with the procurement of RECs tomeet remaining RPS requirements having thelowest priority. The RPS Budget for each year will therefore be allocated in the order of thesepriorities,untilgoalsaremet,or therearenoremaining fundsavailable for thatyear (aswellasallocationofexpectedexpendituresforfutureyears).

3.7. Wind/SolarMatchingRequirementandSolarSplitTheActdefinestheannualRECtargetsforwindandsolarresourcesintermsofthetimingoftheannual quantities to be procured and the technology preferences for the renewable resourcesgeneratingtheRECs.159TheoverallquantityofRECsprocuredtomeettheRPSgoalsmustincludeatleast a combined75% fromwindandphotovoltaicprojects.This is a change from thepriorRPSconstruct,underwhich therewasagoal that75%of therenewableenergyresourcescome fromwind,6%fromphotovoltaics,and1%fromdistributedgeneration.160

InadditiontothewindandphotovoltaicrequirementsthatapplytotheoverallRPSgoals,therearealsospecificnumericaltargetsthatapplytoRECsfromnewwindandnewphotovoltaicprojects.Newprojects are those projects energized after June 1, 2017.161 The REC target deliveries from newprojects from each technology are 2,000,000 RECs by the end of the 2020‐2021 delivery year,3,000,000RECsbytheendofthe2025‐2026deliveryyear,and4,000,000RECsbytheendofthe2030‐2031deliveryyear.ThenewphotovoltaicprojectRECprocurementtargetsarefurtherbrokendown to reflect the procurement of 50% from distributed photovoltaic renewable generationprojects or photovoltaic community renewable generation projects using the Adjustable BlockProgram,40%fromutility‐scalephotovoltaicprojects,2%frombrownfieldsitephotovoltaicprojectsthatarenotcommunitysolarprojects,andtheremaining8%notspecifiedbutdeterminedthroughthisPlan.Furthermore,thetotalamountofRECstargetedfordeliveryfromallnewwindsourcesisintendednottoexceedthetotalamountofRECstobedeliveredfromallnewphotovoltaicprojects.IntheeventthattheprojectedcumulativequantityofnewwindprojectRECstobedeliveredexceedsthe quantity of new solar project RECs projected to be delivered by 200,000 RECs ormore, theprocurement targets for the programs contained in the Planwill be adjusted as needed. Per thedefinitionof“newphotovoltaicprojects”intheAct,RECsprocuredaspartoftheIllinoisSolarforAllProgram (see Chapter 8) cannot be counted as new photovoltaic RECs and therefore are notaccountedassuchinthisPlan,althoughtheseRECswouldcounttowardtheoverall75%ofRECscomingfromwindorphotovoltaicresources.162

3.8. RECPortfolioFortheplanninganddevelopmentofthevariousprocurementsandprogramsunderthisPlan,itisnecessarytoaggregatetheutilitylevelportfoliosofexistingRECsundercontractandRECsfromtheInitial ForwardProcurementmandated in theAct into a single, statewideportfolio ofRECsThatresultingstatewideportfoliocanthenbeexaminedagainstRECgoalsandtargetsmandatedintheActtoestimategapsthatneedtobeclosedthroughtheprocurementofRECs.Thefollowingsections

15920ILCS3855/1‐75(c)(1)(C)160220ILCS5/16‐111.5(a).161TheIPA,inaccountingforRECsfromnewprojectstowardstheSection1‐75(c)(1)(C)RECtargets,excludesRECsprocuredfromDGprojects in2017becauseof their relativesmallquantityanduncertaintyaroundtheirenergizeddate.Theyare,however, included incompliancecalculationstoensurethatatleastacombined75%ofRECsbefromwindandphotovoltaicprojects.16220ILCS3855/1‐75(c)(1)(B),(C).


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examine existing REC portfolios and the resulting statewide REC Portfolio after accounting forexpecteddeliveriesofRECsresultingfromtheInitialForwardProcurement.

3.9. ExistingRECPortfolios‐RECsAlreadyUnderContractEachofthethreeutilitieshasanexistingportfolioofRECsfromIPAprocurementsapprovedpriortotheenactmentofP.A.99‐0906.ThetablesthatfollowshowtheRECportfolioofeachutilityandtheaggregatedstatewideportfolio.163Inthesetables,“LTPPA”meanstheLong‐TermPowerPurchaseAgreements entered into in 2010; “Rate Stability” means the Rate Stability Block Procurementconductedin2012;164and“DG”meanstheDistributedGenerationprocurementsconductedbytheIPAin2015,2016,and2017.165

Table3‐3.AmerenIllinoisExistingRECPortfolio

DeliveryYear

LTPPAWind

LTPPASolar

RateStabilityWind

RateStabilitySolar

DGWind

DGSolar

TotalWind

TotalSolar

TotalAllRECs

2017‐2018

596,571 3,429 251,767 2,629 18 6,797 848,356 12,855 861,211

2018‐2019

596,571 3,429 18 8,411 596,589 11,840 608,429

2019‐2020

596,571 3,429 18 8,411 596,589 11,840 608,429

2020‐2021

596,571 3,429 7,475 596,571 10,904 607,475

Table3‐4.ComEdExistingRECPortfolio

DeliveryYear

LTPPAWind

LTPPASolar

RateStabilityOther

DGWind

DGSolar

TotalWind

TotalSolar

TotalAllRECs

2017‐2018

1,233,838 27,887 271,473 22 16,556 1,233,860 44,443 1,549,776

2018‐2019

1,233,838 27,887 22 23,095 1,233,860 50,982 1,284,842

2019‐2020

1,233,838 27,887 22 23,095 1,233,860 50,982 1,284,842

2020‐2021

1,233,838 27,887 21,181 1,233,838 49,068 1,282,906

163RECsfromtheInitialForwardProcurementconductedinAugust2017arenotincludedinthesetables;insteadtheyareshownintheSectionthatfollows.164Procurementconductedpursuantto220ILCS/16‐111.5(k‐5)(Repealed,effectiveJune1,2017).165Forprocurementandbudgetplanningpurposes,theIPAassumesthatRECsfromtheSpringDG2017Procurementwillbedeliveredstartinginthe2017‐2018deliveryyear,andRECsfromtheFallDGProcurementwillbedeliveredstartinginthe2018‐2019deliveryyear.


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Table3‐5.MidAmericanExistingRECPortfolio

DeliveryYear DGSolar TotalAllRECs

2017‐2018 655 655

2018‐2019 655 655

2019‐2020 655 655

2020‐2021 655 655

3.10. InitialForwardProcurementTheAct requires the IPA to conduct an Initial ForwardProcurement forRECs generatedbynewutility‐scalewind projects, new utility‐scale solar projects, and new brownfield site photovoltaicprojects through 15‐year contracts with the goal of procuring 1,000,000 new wind project and1,000,000newsolarprojectRECsannually.166Theutility‐scaleprojectsarespecifiedasthosewithageneratingcapacitythatisgreaterthan2,000kW,167whilethereisnominimumsizerequirementforthecapacityofthebrownfieldsitesolarprojects.TheInitialForwardProcurementisbeingheldasasingleprocurementeventforwindRECsandmultipleprocurementeventsforsolarRECs.

ThefirstprocurementeventwasheldonAugust31,2017withprocurementtargetsof1millionwindRECs and 200,000 solar RECs to be generated by utility‐scale and brownfield site projects.168AdditionalprocurementeventstobeconductedaspartoftheInitialForwardProcurementwillfocusonprocuringtheremaining800,000solarRECs.Forprocurementandbudgetplanningpurposes,theIPAassumesthatRECsfromtheInitialForwardProcurementwillbedeliveredstartinginthe2019‐2020deliveryyearasshowninTable3‐6.ThisassumptionallowstheAgencytobeconservativeintermsofestimatingfutureexpenditures;theAgencywillmonitorwhenactualdeliveriescommenceandwillinthefutureupdateactualgoalsandbudgetsaccordingly.

Table3‐6.InitialForwardProcurementRECs169

DeliveryYear Wind Solar TotalAllRECs

2017‐2018

2018‐2019

2019‐2020 965,000 1,000,000 1,965,000

2020‐2021 965,000 1,000,000 1,965,000

16620ILCS3855/1‐75(c)(1)(G)(i),(ii).16720ILCS3855/1‐10.168ResultsoftheAugust31,2017procurementareavailableathttps://www.icc.illinois.gov/downloads/public/Public%20Notice%20of%202017%20Wind%20and%20Solar%20REC%20Procurement%20Results%202017‐09‐07.docx.NotethataftertheCommission’sapprovaloftheresults,onewinningwindbidderdeclinedtoacceptitsportionoftheprocurementvolume(whichrepresentedaproratedamountofthatbidder’sbid,giventheInitialForwardProcurement’sstatutorylimitationofa1,000,000RECprocurementvolume).ThequantitieslistedinTable3‐1reflectthatdecision.169Section1‐75(c)(1)(G)oftheActcontemplatesthatdeliveriesfromtheInitialForwardProcurementwillbegindelivery“onJune1,2019,ifavailable,butnotlaterthanJune1,2021.”Therefore,noRECsareindicatedfordeliveryyears2017‐2018and2018‐2019.


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3.11. StatewideRECPortfolioTheutilities’existingRECportfoliosandtheresultingRECsfromtheInitialForwardProcurementsshownabove,intheaggregate,producetheStatewideRECPortfoliopresentedinTable3‐7.ThistableindicatesthevolumeofRECsavailabletomeetthevariousRPSgoalsandtargetsmandatedintheAct.

Table3‐7.StatewideRECPortfolio

Del.Year

ExistingWind

ExistingSolar

ExistingOther170

InitialForwardWind

InitialForwardSolar

TotalWind

TotalSolar

TotalOther

TotalAllRECs

2017‐2018

2,082,216 57,953 271,473 2,082,216 57,953 271,473 2,411,642

2018‐2019

1,830,449 63,477 1,830,449 63,477 1,893,926

2019‐2020

1,830,449 63,477 965,000 1,000,000 2,795,449 1,063,477 3,858,926

2020‐2021

1,830,409 60,627 965,000 1,000,000 2,795,409 1,060,627 3,856,036

3.12. Loads,RPSGoalsandTargets,andRECGapsThevariousprocurementsandprogramsunderthisPlanaredesignedtomeetRPSgoalsandtargetsmandatedbytheAct.Tostarttheprocurementplanningprocess,itisnecessaryfirsttocalculatetheannualRECtargetsandthegapsthattobefilled.InthepriorSection,astatewideRECportfoliowaspresented.TheRECsinthatportfoliowillbeusedinconjunctionwiththeRECtargetsdevelopedinthisSectiontoestimatethegaps.

3.13. ApplicableRetailCustomerLoadThetablebelowshowstheforecastedretailcustomerloadsubjecttoRPScompliancethroughthe2020‐2021deliveryyear.171TheActmandatesthetransitiontoasingleRPSprocurementmechanisminwhichstatewideRPSgoalsareappliedtoallretailcustomerloadbythe2019‐2020deliveryyearandbeyond.ThistabletakesintoaccountthetransitionprovisionsasexplainedinSection3.2.

170“Other”referstoRECsfromothertechnologies,otherthanwindorsolar.171Ascustomary,insupportoftheIPAprocurementprocesses,theutilitiesdevelopedandprovidedtheactualandforecastloadsusedinthisPlan.


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Table3‐8.RetailCustomerLoadApplicabletotheComplianceYear

ComplianceDeliveryYear

ReferenceDeliveryYear

Ameren Illinois[MWh]

ComEd[MWh]

MidAmerican[MWh]172

Statewide[MWh]

2017‐2018 2016‐2017 21,152,970 54,420,529 539,165 76,112,664

2018‐2019 2017‐2018 29,995,820 71,460,380 503,181 101,959,381

2019‐2020 2018‐2019 37,993,441 87,121,731 704,364 125,819,536

2020‐2021 2019‐2020 38,017,110 87,012,436 616,844 125,646,391

3.14. RPSGoalsandTargetsRPSannualgoalsaremandatedintheAct.TodeterminethenumberofRECsrequiredtomeetthegoals(the“OverallRPSTarget”),thedeliveryyearRPSgoalisappliedtothereferenceyearapplicableretailcustomerload(“ApplicableLoad”)asshowninequation(1).

(1) Delivery Year Overall RPS Target = Delivery Year RPS Goal * Reference YearApplicableLoad

The statewideRPSGoals andTargets for 2017‐2018 through 2020‐2021 are shown in the tablebelow.

Table3‐9.StatewideRPSGoalsandTargets

DeliveryYear RPSGoal ReferenceYearReferenceYearApplicableLoad

[MWh]

OverallRPSTarget[RECs]

2017‐2018 13.0% 2016‐2017 76,112,664 9,894,646

2018‐2019 14.5% 2017‐2018 101,959,381 14,784,110

2019‐2020 16.0% 2018‐2019 125,819,536 20,131,126

2020‐2021 17.5% 2019‐2020 125,646,391 21,988,118

3.15. OverallRECProcurementTargets(RECGaps)TheoverallnumberofRECstargetedforprocurementforeachyearunderthisPlan(“RECGap”)issimplythedifferencebetweentheRPSTargetRECsandthetotalnumberofRECsintheStatewideRECPortfolioasshownbelow.

172 As noted in Section 3.4, unlike Ameren Illinois and ComEd for which all retail load is subject to the RPS goals and targets, theMidAmericanapplicableloadsubjecttotheRPSgoalsandtargetsisonlythepercentageofloadthatissubjecttotheIPAprocurementprocess.


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Table3‐10.StatewideOverallRECGap

DeliveryYearOverallRPSTargetRECs

StatewidePortfolioTotalAllRECs

OverallRECProcurementTarget

(RECGap)

2017‐2018 9,894,646 2,411,642 7,483,004

2018‐2019 14,784,110 1,893,926 12,890,184

2019‐2020 20,131,126 3,858,926 16,272,200

2020‐2021 21,988,118 3,856,036 18,132,082

Figure3‐1belowprovidesavisualrepresentationoftheApplicableLoads,RECPortfolio,andOverallRECGapsdiscussedinthisSection.

Figure3‐1.StatewideApplicableRetailLoad,RECPortfolioandOverallRECGap

3.16. Procurement Targets to Meet Specific Wind‐Solar Requirement andOverallRPSTargets

Section1‐75(c)(1)(C)oftheAct,asexplainedinSection3.1,requiresthattheoverallquantityofRECsprocuredtomeettheRPSgoalsmustincludeatleastacombined75%fromwindandphotovoltaicprojects.AnalysisoftheStatewideRECPortfolioagainsttheoverallRPSTargetproducesminimumRECProcurementTargetsforwindandphotovoltaics.Table3‐11belowshowstheminimumRECProcurementTargetsforwindandsolar(i.e.,photovoltaic)projectsandRECsofanytechnologytomeettheoverallRPSTargets.


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Table3‐11.StatewideRECPortfolioandMinimumRECProcurementTargets

Del.

Year

OverallRPSTarget[RECs]

Combined75%

Wind/SolarREC

Requirement

SumofWindand

SolarinREC

Portfolio

MinimumREC

ProcurementTargetforWindandSolar

ExistingPlusARESSuppliedOtherTech.RECs173

TargetedResidualRECProcurementofanyTechnologytoMeetOverallRPSTarget

OverallRECProcurement

Target

(RECGap)

(a) (b)

=(a)*0.75

(c) (d)

=(b)‐(c)

(e) (f)

=(a)‐(c)‐(d)‐(e)

(g)

=(a)‐(c)‐(e)

2017‐

20189,894,646 7,420,985 2,140,169 5,280,816 271,473 2,202,189 7,483,004

2018‐

201914,784,110 11,088,083 1,893,926 9,194,157 3,696,028 12,890,184

2019‐

202020,131,126 15,098,344 3,858,926 11,239,418 5,032,781 16,272,200

2020‐

202121,988,118 16,491,089 3,856,036 12,635,053 5,497,030 18,132,082

3.17. RPSBudgetAsdescribedinSection3.5,theActimposesmonetarylimitationsontheRPSintheformofacostcapthatlimitstheannualaveragenetincreaseinratestoalleligibleretailcustomers.Thecostcaprate,in cents per kilowatt‐hour, is unique to each utility and is provided in Table 3‐2. The cents perkilowatt‐hourrateisappliedtotheactualelectricity(expressedinkilowatt‐hours)deliveredinthedeliveryyearimmediatelypriortodetermineamaximumdollaramountwhichconstitutestheRPSBudgetforthedeliveryyear.Specifically,theActstatesthat:

“Notwithstandingtherequirementsofthissubsection(c),thetotalofrenewableenergyresourcesprocuredundertheprocurementplanforanysingleyearshallbesubjecttothelimitationsofthissubparagraph(E).Suchprocurementshallbereducedforallretailcustomersbasedontheamountnecessaryto limittheannualestimatedaveragenetincreasedue to thecostsof theseresources included in theamountspaidbyeligibleretail customers in connectionwith electric service to nomore than the greater of2.015%oftheamountpaidperkilowatthourbythosecustomersduringtheyearendingMay31,2007ortheincrementalamountperkilowatthourpaidfortheseresourcesin2011.To arrive at amaximum dollar amount of renewable energy resources to beprocuredfortheparticulardeliveryyear,theresultingperkilowatthouramountshallbeappliedtotheactualamountofkilowatthoursofelectricitydelivered,orapplicableportionofsuchamountasspecifiedinparagraph(1)ofthissubsection(c),asapplicable,bytheelectricutilityinthedeliveryyearimmediatelypriortotheprocurementtoall

173ExpectedtobeupdatedApril1,2018.


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retailcustomersinitsserviceterritory.Thecalculationsrequiredbythissubparagraph(E)shallbemadeonlyonceforeachdeliveryyearatthetimethattherenewableenergyresourcesareprocured.Oncethedeterminationastotheamountofrenewableenergyresourcestoprocureismadebasedonthecalculationssetforthinthissubparagraph(E)andthecontractsprocuringthoseamountsareexecuted,nosubsequentrateimpactdeterminationsshallbemadeandnoadjustmentstothosecontractamountsshallbeallowed.AllcostsincurredundersuchcontractsshallbefullyrecoverablebytheelectricutilityasprovidedinthisSection.”174

Autility’sannualRPSBudgetiscalculatedasshowninequation(2).

(2) AnnualRPSBudget($/Year)=PriorYearDeliveredElectricity(MWh)*CostCapRate($/MWh)

A utility’s delivery year remaining available gross RPSBudget (“Available Gross RPSBudget”) isdetermined by subtracting from the utility’s total RPS Budget the direct financial obligationsassociatedwithexistingRECcontracts(“ContractedRECSpend”)andtheestimateddirectfinancialobligationsassociatedwiththeInitialForwardProcurement(“EstimatedRECSpend”),asshowninequation(3).175

(3) DeliveryYearAvailableRPSBudget=AnnualRPSBudget(equation2)–ContractedRECSpend–EstimatedRECSpend

For the purpose of establishing funds available forRECpurchases, as explained in the followingSection,theAvailableGrossBudgetamountwillbeadjustedpriortoanyprocurementtoaccountforindirect costs: (i) allocation to fund the Illinois Solar for All Program, (ii) allocation to fund jobtrainingprograms,and(iii)setasideforadministrativeexpenses.

3.17.1. UtilitiesBudgetsTable 3‐12 through Table 3‐14 show, for each utility, the corresponding Cost Cap Rate, the RPSBudget,thePriorYearDeliveredElectricity,ContractedRECSpend,EstimatedRECSpendassociatedwiththeInitialForwardProcurement,andtheAvailableGrossRPSBudgetfordeliveryyears2017‐2018through2020‐2021.TheAvailableGrossRPSbudgetisanestimatethatwillbeupdatedpriortoconductingcompetitiveRECprocurementsandpriortotheimplementationofProgramsunderthisPlanthatdependontheRPSBudget.

In addition to direct expenditures onRECs, RPS budgetswill also feature allocations for severaladditional purposes. First, pursuant to Section 1‐75(c)(1)(O) of the Act, the greater of 5% or$10,000,000(ofthecombinedRPSbudgetsoftheutilities)eachyearwillbeallocatedtotheIllinoisSolarforAllProgram.SeeSection8.4fordetailsonthatallocation.Second,alsopursuanttoSection1‐75(c)(1)(O),ineachofthedeliveryyears2017‐2018,2021‐2022,and2025‐2026,$10,000,000ofComEd’sRPSbudgetwillbeallocatedtofundjobtrainingprogramspursuanttoSection16‐108.12ofthePUA.Third,areasonableamountofeachbudgetwillbesetasideforadministrativeexpenses

17420ILCS3855/1‐75(c)(1)(E).175IntheeventthatthecostcaplimitationsconflictwiththeRPSgoalsandtargetssuchthattheIPAcannotprocuresufficientadditionalquantities of RECs tomeet theRPS goals or targets, priority for procurement shall first be given to RECs under existing contractualobligations,followedbyRECsfortheIllinoisSolarforAllProgram,followedbyRECsnecessarytocomplywiththenewwindandsolarprocurementrequirements,andfinallyRECsnecessarytomeettheremainingRPSrequirements.20ILCS3855/1‐75(c)(1)(F).


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(including,butnotlimitedto,expensesrelatedtodevelopmentofthisPlanandfutureupdates,themanagementofprocurementsandprograms,AdjustableBlockProgramAdministratorexpensesnotcoveredbyfeeschargedtoparticipants,andfeeschargedbytrackingsystemsfortheretirementofRECs).TheIPAproposesinitiallytosetaside3%ofthebudgetfortheseadministrativeexpenses,andwillrefinethissetasideasmoreinformationbecomesavailable.

Unspentfundsfordeliveryyears2017‐2018through2020‐2021willrolloverandbeavailableforthesubsequentdeliveryyear,providedthattherolloverfundsmustbeappliedonorbeforeMay31,2021.Uptohalfofanyrolloverfunds,moreover,maybeallocatedtocoverany“fundingshortfall”fortheIllinoisSolarforAllProgram(seeSections2.6.1and8.4.3formoredetails).176TheAgencywillupdateRPSbudgetsonanannualbasistoreflectthesevariousadjustments.

Table3‐12.AmerenIllinoisRPSBudget177

DeliveryYear

PriorYearDeliveredElectricity(MWh)

CostCapRate($/MWh)

RPSBudgetContractedRECSpend

EstimatedRECSpendInitialForwardProcurement

AvailableGrossRPSBudget(est.)

2017‐2018 21,152,970 1.8054 $38,189,571 $9,412,155 $28,777,416

2018‐2019 29,995,820 1.8054 $54,154,453 $8,000,000 $46,154,453

2019‐2020 37,993,441 1.8054 $68,593,358 $7,999,000 $3,000,000 $57,594,358

2020‐2021 38,017,110 1.8054 $68,636,091 $7,753,000 $3,000,000 $57,883,091

Table3‐13.ComEdRPSBudget178

DeliveryYear


CostCapRate

($/MWh)RPSBudget

ContractedRECSpend

EstimatedRECSpendInitialForward

Procurement


2017‐2018 54,420,529 1.8917 $102,947,315 $23,718,264 $79,229,051

2018‐2019 71,460,380 1.8917 $135,181,601 $23,357,415 $111,824,186

2019‐2020 87,121,731 1.8917 $164,808,179 $23,484,084 $8,000,000 $133,324,095

2020‐2021 87,012,436 1.8917 $164,601,426 $23,095,360 $8,000,000 $133,506,066

176See220ILCS5/16‐108(k).177Doesnotincludeindirectallocations,administrativesetaside,ARESACPfundscollectedbytheutility,oruncommittedHourlyACPfunds.178Doesnotincludeindirectallocations,administrativesetaside,ARESACPfundscollectedbytheutility,oruncommittedHourlyACPfunds.


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Table3‐14.MidAmericanRPSBudget179

DeliveryYear


CostCapRate

($/MWh)RPSBudget

ContractedRECSpend


Procurement


2017‐2018 539,165 1.2415 $669,373 $111,829 $557,544

2018‐2019 503,181 1.2415 $624,699 $111,829 $512,870

2019‐2020 704,364 1.2415 $874,468 $111,829 $36,000 $726,639

2020‐2021 616,844 1.2415 $765,812 $111,829 $36,000 $617,983

Table3‐15.StatewideRPSBudget180

DeliveryYear RPSBudgetContractedRECSpend


ProcurementRECSpend


2017‐2018 $141,806,259 $33,242,248 $108,564,011

2018‐2019 $189,960,753 $31,469,244 $158,491,509

2019‐2020 $234,276,005 $31,594,913 $11,036,000 $191,645,092

2020‐2021 $234,003,329 $30,960,189 $11,036,000 $192,007,140

179Doesnotincludeindirectallocation,administrativesetaside,orARESACPfundscollectedbytheutility.180Doesnotincludeindirectallocation,administrativesetasides,ARESACPfundscollectedbytheutilities,oruncommittedHourlyACPfunds.


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3.18. SummaryofRECProcurementTargetsandRPSBudgetsTheaggregationofRECTargetsandRPSBudgetsatastatewidelevelprovidesanimportanttoolforplanningandimplementingthevariousprocurementsandprogramsunderthisPlan.ThetablebelowpresentsasnapshotsummaryoftheRECGaptobeprocuredandAvailableGrossRPSBudget,whichtogetherareessentialfactorstoachievetheRPSGoalssetforthbytheAct.

Table3‐16.StatewideRECGapandAvailableRPSBudget181

DeliveryYearOverallRECProcurement

Target(RECGap)

Available GrossRPSBudget

(est.)

2017‐2018 7,483,004 $108,564,011

2018‐2019 12,898,337 $158,491,509

2019‐2020 16,280,353 $191,645,092

2020‐2021 18,140,235 $192,007,140

3.19. AlternativeCompliancePaymentFundsHeldbytheUtilitiesAs of June 1, 2017, Ameren Illinois had $16.2 million and ComEd $32.8 million of alternativecompliancepaymentscollectedfromretailcustomersthattakeserviceunderelectricutilities'hourlypricingtariffortariffs.ThesefundsarebeingusedtofundtheRECpurchasesfromthe2015through2017 distributed generation procurements the Agency conducted for the utilities.182 The finaldistributed generation procurement occurred on October 13, 2017.With the completion of thatprocurement,andasofOctober31,2017,theremainingbalanceofunallocatedhourlyalternativecompliancepaymentsis$11.3millionforAmerenIllinois,and$20.3millionforComEd.Also,asofOctober31,2017,AmerenIllinoishad$23.4million,ComEd$40.6million,andMidAmerican$0.01million of alternative compliance payment funds collected fromARES since June 1, 2017.183 Theutilitieswillcontinuetocollectalternativecompliancepayments fromARESin2018and2019asARESRPScomplianceobligationsphaseout.

TheIPAproposestosetasidetheuncommittedbalanceoftheHourlyACPfunds,aswellastheARESACPfundscollectedbytheutilities(atotalof$95.6millionasofOctober31,2017184)foruseatalaterdateintheeventofashortfallintheAvailableRPSBudgets.Theuncommittedfundscouldalsobeasourceof theavailable fundsused tohelp support the Illinois Solar forAllProgram.TheAgencybelievesthatholdingthesefundsinreservefortheshorttermisaprudentwaytousethefundstomanagethetransitiontothenewRPSstructureprovidedforunderP.A.99‐0906.

181Doesnotincludeindirectallocation,administrativesetasides,ARESACPfundscollectedbytheutilities,uncommittedHourlyACPfunds.1822016and2017DistributedGenerationprocurementsforMidAmericanwerefundedoutofMidAmerican’sRenewableEnergyResourcesbudget,asMidAmericandoesnothaveanyHourlyAlternativeCompliancePayments.183Section16‐115DofthePUAprovidesthatwhile“[t]hroughMay31,2017,allalternativecompliancepaymentsbyalternativeretailelectricsuppliersshallbedepositedintheIllinoisPowerAgencyRenewableEnergyResourcesFund,”“beginningwiththedeliveryyearcommencingJune1,2017,allalternativecompliancepaymentsbyalternativeretailelectricsuppliersshallberemittedtotheapplicableelectricutility”andnotdepositedintotheRERF.(220ILCS5/16‐115D(d)(4),(4.5).)Seealso83IllAdm.CodePart455.184AdditionalARESACPfundswillbecollectedbytheutilitiesin2018and2019.


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3.20. ImpactofRPSBudgetonProcurementVolumes AsexplainedinpriorsectionsofthisChapter,theavailableRPSBudgetsmaylimitthequantityofRECsthatcanbeprocuredtomeettheRPSgoals.Forexample,aspresentedinthetablesabove,forthe2020‐2021deliveryyear,anestimateoftheavailableGrossRPSBudgetstatewideis$192million;foradeliveryyearfeaturingagapofapproximately18millionRECs;thisindicatesthatabudgetofroughly$11perRECisavailabletomeettheRPSGoalforthatdeliveryyear.However,theRECGapis expected to be filled with RECs from a variety of sources: spot procurements, forwardprocurements,andtheAdjustableBlockProgram.TheRECpricesforthesewilllikelyvarygreatly,andtheAdjustableBlockProgramfeaturespaymentforRECsthatisheavilyfront‐loaded.

WhiletheAgencyinChapter6hasproposedRECpricesfortheAdjustableBlockProgram,thetimingbetweenwhenaprojectreservesitsRECpricefromanapplicableBlockandwhenitisenergizedandthusbeginsreceivingpayments(whicharefront‐loadedtovaryingdegrees)isnotyetknownbecausethat program is designed to allocateRECs to projects before they are built, and the lag betweenreservingfundsandthestartofpaymentafterdevelopmentiscompleteandtheprojectenergizedcouldbeasmuchastwoyears.185Furthermore,theAgencyhasproposedmeasurestopotentiallycapthenumberofprojectsinspecificBlockgroupsundertheAdjustableBlockProgramtohelppreventcreatingcontractualobligationsgreaterthantheavailablefundingavailable.Inaddition,theAgencyhas a long‐standing policy not to publicly speculate on, or suggest, future REC prices related tocompetitive procurements. This creates a slight challenge in terms of discussing when the RPSBudgetswill become limited.Onemitigating factor is that through the 2020‐2021delivery year,unspentfundscanberolledoverfromoneyeartothenext.GiventhattheproposalscontainedinthisPlanwillnotlaunchuntilthe2018‐2019deliveryyear,andonlylimitedfundswouldbespentforaspotprocurementtoattempttomeetthe2017‐2018deliveryyeargoals,theAgencyexpectsthattheamount of accumulated roll‐over in the initial years could be substantial. That roll‐over will befurthersupplementedbythehourlyACPfundsthathavebeencollectedandnotallocatedtothepriorutilityDGprocurements,aswellastheARESACPfundsthathavebeencollectedandwillbecollectedin2018and2019.

In light of those observations, the Agency does not expect that the procurements and programsproposedinthisPlanwillbelimitedbyavailableRPSbudgetfundsthroughatleastthe2020‐2021deliveryyear.TheAgencywillrefineandupdatethisestimatewhenitupdatesthisPlanin2019forimplementation in calendar year 2020, and if it appears therewill be limitations created in theavailableRPSBudget, theAgencywillproposeprocurement andprogramapproaches toaddressthoselimitationsproactivelyincludingpotentiallysettingspecificbudgetsforindividualprogramsandprocurements.186Nonetheless,through2019,theAgencywillcarefullymonitortheresultsofitsprocurements andprogramsandwill adjust procurement andprogramvolumes accordingly if itfindsitnecessarytodoso.

185SeeSections6.15.1and6.15.2.186AnysuchallocationswouldbemadeconsistentwiththeprioritiesoutlinedinSection1‐75(c)(1)(F)oftheActandconsistentwithanyotherimmutableobligationsinthegoverninglaw.


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4. RenewableEnergyCreditEligibilityTobeeligible foruse in compliancewith the IllinoisRPS,RECsare required tomeetavarietyofeligibilityrequirements.First,theRECsaretobesourcedfromgeneratingtechnologiespermittedinthe definition of “renewable energy resources” contained in Section1‐10 of theAct. The reviseddefinitioncontainedintheActremovesthecategory“otheralternativesourcesofenvironmentallypreferable energy” from the definition.187 Second, Public Act 99‐0906 added two new eligibilityrequirements in Subsections (I) and (J) of Section 1‐75(c)(1). Subsection (I) creates locationaleligibilitycriteria,whilesubsection(J)createscriteriarelatedtohowafacilitythatgeneratesRECsrecoversitscosts.ThisChapterdiscusseshowtheAgencyproposestointerpretandimplementthesetwonewrequirements.

4.1. AdjacentStateRequirementSection1‐75(c)(1)(I)oftheIPAAct,anewprovisioncontainedinPublicAct99‐0906,createdanewlocationaleligibilityrequirementfortheIllinoisRPS.Thisrequirementreplacesthepriorstandard,whichwasthatrenewableenergyresourcescouldcomefromIllinoisandadjoiningstates,andifnotavailable, thentheycouldcome fromelsewhere.188Thenewlocationalrequirementspecifies thatqualifying renewable energy credits canbe generatedby facilities located in Illinois, andmaybesourced from facilities in adjacent189 states—but only if these facilities canmeet a set of publicinterest criteria. While not explicitly stated in the statute, the Agency understands that theconsiderationofthepublicinterestcriteriaforadjacentstatesmeansthatrenewableenergycreditsfromstatesthatarenotadjacenttoIllinois(orforthatmatter,fromothercountries)wouldnotbeeligiblefortheIllinoisRPS.

ThepublicinterestcriteriathattheAgencyisinstructedtoconsiderinclude:

1. Minimizing sulfur dioxide, nitrogen oxide, particulate matter and other pollution thatadverselyaffectspublichealthinthisState

2. IncreasingfuelandresourcediversityinthisState3. EnhancingthereliabilityandresiliencyoftheelectricitydistributionsysteminthisState4. Meetinggoalstolimitcarbondioxideemissionsunderfederalorstatelaw5. ContributingtoacleanerandhealthierenvironmentforthecitizensofthisState

TheActspecifiesthattheAgency“mayqualifyrenewableenergycredits fromfacilities located instates adjacent to Illinois if the generator demonstrates and the Agency determines that the

187Thisleavesthedefinitionas,"‘[r]enewableenergyresources’includesenergyanditsassociatedrenewableenergycreditorrenewableenergycredits fromwind,solarthermalenergy,photovoltaiccellsandpanels,biodiesel,anaerobicdigestion,cropsanduntreatedandunadulteratedorganicwastebiomass, treewaste,andhydropowerthatdoesnot involvenewconstructionorsignificantexpansionofhydropowerdams.Forpurposesof thisAct, landfillgasproducedin theState isconsideredarenewableenergyresource. `Renewableenergyresources’doesnotincludetheincinerationorburningoftires,garbage,generalhousehold,institutional,andcommercialwaste,industriallunchroomorofficewaste,landscapewasteotherthantreewaste,railroadcrossties,utilitypoles,orconstructionordemolitiondebris,otherthanuntreatedandunadulteratedwastewood.”188Former20ILCS3855/1‐75(c)(3),repealedJune1,2017.189ForthepurposeofassessingeligibilityforcompliancewiththeIllinoisRPS,theAgencydefinesonlystatesthathaveacommonborderasstatesadjacenttoIllinois:Wisconsin,Iowa,Missouri,Kentucky,Indiana,andMichigan.MichiganisconsideredadjacentduetotheborderbetweenIllinoisandMichiganthatexistsinLakeMichigan.ThisisconsistentwithhowotherStateAgenciesinterpretthefederalCoastalZoneManagementAct.Seeforexample,https://www.dnr.illinois.gov/cmp/documents/3_boundary.pdf.


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operationofsuchfacilityorfacilitieswillhelppromotetheState'sinterestinthehealth,safety,andwelfareofitsresidentsbasedonthepublicinterestcriteriadescribedabove.”190

Todoso,andto“ensurethatthepublicinterestcriteriaareappliedtotheprocurementandgivenfulleffect”, the Plan “shall describe in detail howeachpublic interest factor shall be considered andweightedforfacilitieslocatedinstatesadjacenttoIllinois.”ThisChapterprovidesthatdescription.

Developing a methodology for considering and weighting these public interest criteria createscertain challenges. The complex nature of an interconnected electric power grid and associatedsystemoperations(i.e.,generationdispatchforeconomicsandreliability),andhowpollutionflowsacrossstates,allpreventtheAgencyfromsimplyquantifyingandscoringfacilityeligibilityrequestsusingeasilyobtainabledata.Whilepredictionscanbesimulated,thereisnotoneclear,unassailablewaytodeterminehowarenewableenergyfacilityinanadjacentstatewillmeetthepublicinterestcriteria.

Instead, theAgencyhasdevelopedwhat itbelievesarereasonableproxies foreachcriterion.TheAgency notes that it developed a similar set of criteria for use in its Zero Emission StandardProcurement Plan (“ZES Plan”) developed pursuant to Section 1‐75(d‐5) of the Act, which wasapprovedbytheCommissiononSeptember11,2017inDocketNo.17‐0333.ThatZESPlanincludesconsiderationofhowtominimizesulfurdioxide,nitrogenoxide,andparticulatematteremissionsthatwouldresultfromthepotentialclosureofzeroemissionfacilities(i.e.,nuclearplantslocatedinPJMorMISO).

Thecircumstancesunderconsiderationinthatplanweredifferent;fortheZESPlan,thechallengewasindeterminingwhatgenerationwouldreplaceazeroemission(nuclear)facilityshoulditclose(and its associated environmental effects), rather than assessing the value that a renewablegeneratingfacilitywouldaddtothegridandtheenvironment.Forexample,whilebasedconceptuallyonthesameapproachusedfortheZESPlan,thebasisfordeterminingcompliancewithoneofthepublicinterestcriteriainthisPlanisfocusedonthedisplacementofpotentialnewnon‐renewablegas‐fired generation by renewable generation that could be eligible to supply RECs tomeet theIllinois RPS requirements. Among the differences from the ZES Plan scoring approach are thatrenewable generating facilities are likely to be intermittent rather than baseload (a definingcharacteristicofzeroemissionfacilities),typicallyimpactgenerationonthemarginofthedispatchorder,andaregenerallysmallerinsizerelativetotheZESreplacementgeneration.

ToassesswhetherarenewablegeneratingfacilitylocatedinanadjacentstateiseligibletoparticipateintheIPA’sRECprocurementstomeettheIllinoisRPS,theAgencyproposestoassignamaximumof20pointstoeachofthefivepublicinterestcriteria,asdescribedbelow,foratotalof100possiblepoints.

ForarenewableenergygeneratingfacilityinanadjacentstatetohaveitsRECsconsideredeligiblefortheIllinoisRPS,theIPAproposesthatanadjacentstatefacilitywouldneedtodemonstratethatitcanachieveatotalscoreofatleast60pointsfortheAgencytoapprovethatrequest.TheIPAbelievesthatthisscorethreshold–onewhichrequiresabetterthanaveragescoredemonstratingbenefitstothehealth,safety,andwelfareofIllinoisresidents,butyetnottoooneroustoprohibitanyadjacentstateparticipation–providesabalancedapproachtoensuringthatadjacentstatefacilitiesindeedprovidesufficientbenefitsconsistentwiththelaw’sdirective. TheAgencycommitstoreviewand19020ILCS3855/1‐75(c)(1)(I).


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analyze not only this scoring threshold, but also the Agency’s proposed methodology for theconsiderationofadjacentstatefacilities,forits2019updateofthisPlan.

TheAgencyalsonotesthattherearetwowindfacilitiesinadjacentstatesthatweretherecipientsofcontractsfromthe2010Long‐TermRenewableResourcesProcurement.OneinIowahasacontractwith Ameren, while one in Indiana has a contract with ComEd. As these facilities were grantedcontractsatatimethatIllinoislawviewedthemasprovidingsufficientbenefitstoIllinoisresidentsfortheirrenewableenergyresourcestobeusedtomeettheIllinoisRPS,theAgencyproposesthatthesetwofacilitiesbegrandfatheredintothisrequirement.

4.1.1. PublicInterestCriteria1. Minimizingsulfurdioxide,nitrogenoxide,particulatematterandotherpollutionthat

adverselyaffectspublichealthinthisState

IntheZeroEmissionStandardProcurementPlan,theAgencydevelopedascoringmethodologyforsulfur dioxide, nitrogen oxide, and particulate matter that considered the likely location ofreplacementgenerationcomparedtoabiddingzeroemissionfacilitythatcouldbeatriskofceasingoperation.Thatmethodologycalculated,foranygivenzeroemissionfacility,thepercentageofthereplacementgenerationthatwouldoccur invariousstates,anemissions factorrelatedtoeachofthosestatesbasedonitsexistingcoalandgasgeneration,andanadjustmentfactorthatrecognizedthe frequencyofprevailingwindsandthedistance fromIllinois thatcouldpredict theamountofpollutionthatwouldimpacttheresidents(andthuspublichealth)ofIllinois.

ForthepurposesofthisPlanandtheconsiderationofthiscriterion,theAgencyproposestorefineandsimplifythemethodologicalapproachutilizedintheZESPlan.UndertheZESPlan,emissionsareassociatedwithreplacementofgenerationlocatedanywhereinPJMorMISO;forthepurposesofthisPlan,theAgencywillconsiderthatarenewableenergyfacilitywoulddisplacetheemissionsofatypicalnewnaturalgas‐firedgenerationfacility.

IntheZESPlan,theAgencyweightedreplacementgenerationacrossmultiplestates,inrecognitionthat replacement generation for a large Zero Emission Facilitywould likely come frommultiplesources(replacementgenerationwouldbeacombinationofchangeddispatchofexistinggenerationunits aswell as the potential development of new generating units).191 For this Plan theAgencyproposessimplifyingthatweightingtofocusoncomparingemissionsfromrenewablegenerationtotheemissionsfromanewnaturalgas‐firedgeneratingfacility.ThisassumptionreflectsthefactthatrecentandanticipatedadditionstotheresourcemixinPJMandMISOwillbepredominantlynaturalgas,windorsolar192andnaturalgasisincreasinglythefuelonthemarginforbothPJMandMISO,andthusmoreappropriateforcomparisonthan,say,abaseloadcoalfacility.193Asdiscussedbelow,191Specifically,33%ofthereplacementgenerationwasassumedtobeinthebiddingzeroemissionfacility’sownstate,andtheremaining67%ofreplacementgenerationwasassumedtooccuracrosstherelevantRTO,allocatedbystatesbasedoneachstate’sshareofRTO‐widegeneration.ZESPlan,July31,2017,https://www.icc.illinois.gov/downloads/public/edocket/451223.pdf,at37.192TheNorthAmericanElectricReliabilityCorporation2016Long‐TermReliabilityAssessment (December2016)notes that capacityadditionsintheEasternInterconnection(whichincludesPJMandMISO)fortheperiod2015through2016areforecastedtobemorethan95 percent natural gas, wind, or solar. In the March 2017 report, “PJM’s Evolving Resource Mix and System Reliability”(http://www.pjm.com/~/media/library/reports‐notices/special‐reports/20170330‐pjms‐evolving‐resource‐mix‐and‐system‐reliability.ashx),PJMstatesthatfrom2010to2016,naturalgasandrenewablemadeup87percentofnewmegawattsplacedinservice.193See:PotomacEconomics,“2016StateoftheMarketReportfortheMISOElectricityMarkets,”June2017,https://www.potomaceconomics.com/wp‐content/uploads/2017/06/2016‐SOM_Report_Final_Rev.pdf;MonitoringAnalytics,LLC,“Q22017StateoftheMarketReportforPJMJanuarythroughJune,”August10,2017,http://www.monitoringanalytics.com/reports/PJM_State_of_the_Market/2017.shtml.


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thiscomparisonisarelevantfactorintheevaluationcriteriaforrenewabletechnologiesthatinvolvecombustion(thusnotincludingwind,solar,orhydro).

To simplify the calculation, the emissions comparisonwill includeSO2 andNOx asproxies for allemissionsbecausehigheremissionsofSO2andNOxaregenerallycorrelatedwithhigheremissionsofPM,especiallywithregardtofacilitiesthatinvolvethecombustionofsolidfuels.TheSO2andNOx

areprimarysourcesofPM2.5inambientairawayfromtheimmediateemissionssource,ascoarsePM(PM10) isdepositednearerthesource,whilesecondaryPM2.5 increasesbasedontheformationofsulfatesandnitratesfromtheSO2andNOxintheatmosphereasthepollutantsmoveawayfromtheprimarysource.194ThefollowingtableshowsSO2,NOx,andCO2emissionsratesofnewnaturalgas‐firedgenerationbasedupon2016datafromtheU.S.EnergyInformationAgency(“EIA”).195

Table4‐1:NaturalGas‐FiredGenerationEmissionsRates

Pollutant Pounds/MWhSO2 0.007NOX 0.05CO2 772

The calculationof the scorewillmultiply an emissions factor for the renewable resource facility(scaledfrom0to1)byawindduration/directionfactor(scaledfrom0to1)andthenby20pointstodeterminethenumberofpointsawardedforthiscriterion.

Theemissionsfactoriscalculatedbytakingoneminus:thesumoftheeligiblerenewableresource’sSO2andNOxemissionsinpounds/MWhdividedbythesumoftheSO2andNOxemissionsfromanewnaturalgas‐firedgenerationfacilityinpounds/MWh.

Theemissionsfactorforrenewableenergygeneratingfacilitiessuchaswind,solar,orhydro,whichdonotemitSO2,NOx,orParticulateMatter,wouldbe1.0becausethosefacilitieswouldhavezerointhenumeratorofthepartoftheequationthatissubtractedfromone.

Forotherrenewablegeneratingtechnologies,theAgencynotesthatthosetechnologieseligibleforthe Illinois RPS include a combination of technologies that rely on combustion of a fuel sourceincluding biodiesel, anaerobic digestion (which presumably would create a biogas that is thenburned),biomass,andtreewaste;andothertechnologiesthatdonotinvolvecombustion(e.g.,wind,solarthermal,photovoltaic,andhydropower).196Renewablegenerationtechnologiesthatinvolvecombustiontogenerateelectricitygeneratesulfurdioxide,nitrogenoxide,particulatematter,andCO2,amongotherthings.Inordertoassesstheemissionsimpactofrenewableresourcetechnologiesthatinvolvecombustion,theemissionsfromthesefacilitiesarecomparedtotheemissionsfromanewnaturalgas‐firedfacility.TotheextentthatthetechnologiesthatinvolvecombustiongenerateSO2andNOxemissions,andtheemissionsinpounds/MWharelowerthantheemissionsfromanew

194U.S.EPA,“ParticulateMatterEmissions,”ReportontheEnvironment,http://www.epa.gov/roe/195Emissionsratesforanaturalgasturbineoperatingincombinedcyclewithaheatrateof6,600Btu/kWhareshowninTable2‐5oftheNovember2016U.S.EIAReport“CapitalCostEstimatesforUtilityScaleElectricityGeneratingPlants.”TheCO2emissionsinpoundsperMMBtuare117forCO2,0.001forSO2,andforNOx0.0075;whichattheheatrateof6,600Btu/kWh,are772poundsperMWhofCO2,0.007poundsperMWhofSO2,and0.05poundsperMWhofNOx.See:https://www.eia.gov/analysis/studies/powerplants/capitalcost/pdf/capcost_assumption.pdf.196WhilelandfillgasproducedinIllinoisiseligible,itisnotrelevanttothisdiscussionoffacilitieslocatedinadjacentstates.


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gas‐firedfacility, thenthecalculationfortherenewableenergyfacilitywouldresult inthefacilityreceivingpointsforthiscriterion.Ontheotherhand,iftheemissionsareequaltoorgreateronapounds/MWhbasisthanfromanewnaturalgas‐firedfacility,thenthecalculationwouldresultinthefacilityreceivingzeropointsforthiscriterion.Thisreflectsthatanemissionsratethatisgreaterthanthatforanaturalgas‐firedfacilitydoesnothaveapositiveimpactontheenvironmentandpublichealth.

TheZeroEmissionStandardPlanincludedconsiderationofwinddirectionanddurationaswellasthedistancefromIllinoistomodifytheemissionscriteriascoring.InscoringtheemissionsrelatedpublicinterestcriterionforthisPlan,theAgencyproposestosimplifythewindduration/directionapproach.SincetherenewablegeneratingfacilitiessupplyingRECsfromoutsideofIllinoismustbelocatedinthestatesadjacenttoIllinois(asopposedtoanywherewithinPJMandMISOundertheZeroEmissionStandard),theconsiderationofdistanceislessimportantandwillnotbeconsideredintheapproachadoptedforthisPlan.

Thefollowingtableprovidesthewindduration/directionfactorsforeachadjacentstate.

Table4‐2:WindDuration/DirectionFactors

AdjacentState WindDirectionSectors WindDirectionandDurationFactor197

Indiana SSE,SE,ESE,E,NNE,NE,ENE 0.256Kentucky S,SSE,SE 0.201Missouri W,WSW,SW,SSW,S 0.439Iowa W,WNW,NW,NNW 0.269Wisconsin N,NNW 0.096Michigan NE,NNE 0.088

ThewinddurationfactorisbasedonthepercentageofthetimethewindblowsintoIllinoisfrom16directionalsectorsthatformallofthedirectionsin360degreesaroundIllinois. Forexample,thewindblowingfromIndianawouldencompasssevendirectionalsectorsfromwhichthewindblowsonaverage25.6percentof the time. Thus, forexample, a solar facility located in Indianawouldreceive1x0.256x20or5.1points.Thefollowingequationshowshowthisscoreisobtained:

Figure4‐1:PollutionScoreCalculation

20 /

1

2

2

FactorDirectionDurationWind

MWh

lbsNOandSO

MWh

lbsNOandSO

Score

resourcegasx

resourcerenewablex

197Totalfactorsexceed1.0becausetheremaybemorethanonestaterepresentedinagivenwinddirectionsector.


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2. IncreasingfuelandresourcediversityinthisState

Fuelandresourcediversitygenerallyreferstotheuseofabalancedgroupofgeneratingfacilitiesandtechnologieswhich results in reducing the risk that a specific technologycouldadversely impactoverallsystemreliability.Forexample,PJMdefinesfueldiversityas:utilizingmultipleresourcetypestomeetdemandsuchthatasufficientlydiversifiedsystemisexpectedtoprovidetheflexibilityandadaptability to: “1)mitigate risk associatedwith equipment design issues or commonmodes offailureinsimilarresourcetypes,2)addressfuelpricevolatilityandfuelsupplydisruptions,and3)reliablymitigateinstabilitiescausedbyweatherandotherunforeseensystemshocks.”198Ineffect,fuelandresourcediversitycanactasahedgetohelpensureastableandreliablesupplyofelectricity.

Any generation source that promotes more reliance on generation sources other than coal andnuclear, which presently have generation shares of 38% and 50.2% of Illinois’ total generationrespectively,wouldcontributetoincreasingfuelandresourcediversityinIllinois.Bythismeasure,anyoftheeligiblerenewableenergyresourcegeneratingtechnologieswouldcontributetodiversityinIllinois.However,sincethesefacilitieswouldbelocatedoutsideofIllinois,intheadjacentstates,thefullimpactontheState’sfuelandresourcediversitydependsonwhethertheelectricitygeneratedbythesefacilitiescouldactuallybeavailabletoIllinoisend‐users.

GiventhatrenewablegenerationiscurrentlyonlyasmallfractionoftheresourcemixforIllinois,theincrease of renewable generation in the region could increase the fuel and resource diversity ofIllinois.However,theAgencynotesthatIllinoisisanetexporterofelectricity,sotheimpactonfuelandresourcediversity inIllinoismaybelimitedfor facilities locatedinadjacentstates.ButwhileIllinois isanetexporterofelectricity, thatdoesnotmeanthatthereisnoimpactonIllinoisfromelectricitygeneratedinadjacentstates,becauseonanhour‐to‐hourbasiselectricitymayflowinto,oroutof,Illinois.Inordertoaddressthisissueforfacilitieslocatedintheadjacentstates,theAgencywillusethelocationoftherenewableresourcefacilityrelativetoIllinoisasthebasisformodifyingthe fuelandresourcediversityscore. Adistance factorwillbecalculated foreach facility.199ThedistancefactorwillbebasedonthedistancefromthefacilitytoMorris,Illinois(whichisthetownclosesttothepopulationweightedgeographiccenterofIllinois,200andthuscanserveasareasonableproxyfortheload‐weightedcenterofthestate).Thefactorwillbecalculatedas1minustheratioof(i)thedistancefromthefacilitytoMorrisand(ii)470miles,whichisroughlythefurthestpointinanadjacentstatefromMorris.Thatfactorwillbemultipliedbythemaximumpossible20points.

Figure4‐2:FuelandResourceDiversityScore

20 470

)( , 1

miles

milesILMorristofacilityfromDistanceScore

198PJM,“PJM’sEvolvingResourceMixandSystemReliability,”March2017,availableat:http://www.pjm.com/~/media/library/reports‐notices/special‐reports/20170330‐pjms‐evolving‐resource‐mix‐and‐system‐reliability.ashx.199Becausewindfarmscoveralargegeographicarea,awindfarm’sdistancewouldbebasedontheborderoftheclosestcountycontainingturbinesthatarepartofthatwindfarm.200Basedonthe2010Census.See:https://www2.census.gov/geo/docs/reference/cenpop2010/CenPop2010_Mean_ST.txt.


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3. Enhancingthereliabilityandresiliencyoftheelectricitydistributionsystem inthisState.

While this criterion references the “electricity distribution system” and that term is generallyunderstood tomean the local distribution system that serveshomes andbusinesses andnot thetransmissiongridthattransportspoweroverlongerdistances(andacrossstatelines),theAgencyisconcernedthatreadliterally,therewouldbenodirectwayforafacilityinanadjacentstatetomeetthiscriterionbecauseafacilityinanadjacentstatewouldhave(atbest)onlyanincidentalimpactonthedistribution system (ormore accurately systems, eachoperatedby adifferent utility)withinIllinois.Withthatinmind,theAgencyproposestointerpretthiscriterionmoreliberallyandconsiderthe impact on the grid more generally, as distribution service is ultimately supported by thereliabilityoftransmissionservice.Thescoringforthispublicinterestcriterioninvolvesathresholdand,basedontheassumptionthatgeneratingfacilitieslocatedclosertoIllinoiswouldhaveamorebeneficialimpactontheState’sdistributionsystemreliabilityandresiliency,adistancefactor.ThecriterioncanbeunderstoodtorefertothetransmissionsystemsoperatedbyPJMandMISO.TotheextentthatafacilityinanadjacentstateisnotinterconnectedtothePJMorMISOgrid(forexample,in the portions of Iowa and Missouri that are part of the Southwest Power Pool(“SPP”)), thosefacilitieswouldnotscoreanypointsforthiscriterion.Otherwise,afacilityinanadjacentstatethatisineitherofthePJMorMISOcontrolareaswouldbeeligibletoreceivepoints.Toobtainthedistancefactor, theAgencywilluseanapproachthatconsidersproximitytoIllinoisandthusanincreasedlikelihoodthatelectricityproducedwillprovideincreasedsystemreliabilityandresilience.

Thescoringforthispublicinterestcriterionwillutilizethesamedistancefactorasisappliedtothefuelandresourcediversityscoring.

Figure4‐3:ReliabilityandResiliencyScore

20 miles 470

(miles) IL Morris, ofacility t from Distance1 0 else PJM/MISO;in if 1

Score

4. MeetinggoalstolimitcarbondioxideemissionsunderfederalorStatelaw

DuetothestayoftheUnitedStatesEnvironmentalProtectionAgency’s(“USEPA”)CleanPowerPlanimposedbytheU.S.SupremeCourtinFebruary2016,therearenotcurrentlyanyenforceablefederallawsorregulationsthatlimitcarbondioxideemissionsfromexistingpowergenerationfacilities.201Illinois does not have any specific law that limits carbon dioxide; however, there are multipleprovisionsofIllinoislaw,suchastheZeroEmissionStandardandtheRenewableEnergyPortfolioStandard,thatrecognizethevalueofminimizingcarbondioxideemissionsevenifthoseprovisionsdonotcreateexplicitlimits.Torecognizethevalueinreducingcarbondioxideemissions,theAgencywilldeterminethescoreforeachrenewableresourcefacilitybyadjustingthe20pointsavailableforthiscriterionbyafactorwhichreflectstheratiooftheCO2emissionsfromtherenewableresourcetotheCO2emissionsfromanewnaturalgasfiredgeneratingfacility,772poundsofCO2perMWh,asshown inTable 4‐1 above. Thiswill be done by using the formula applied to the first emissions

201See,e.g.,http://www.nytimes.com/2016/02/10/us/politics/supreme‐court‐blocks‐obama‐epa‐coal‐emissions‐regulations.html;http://www.scotusblog.com/wp‐content/uploads/2016/02/15A773‐Clean‐Power‐Plan‐stay‐order.pdf.


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criterionexceptthattheinputswillbepoundsofCO2emittedperMWh.Thefactorappliedtothe20pointsavailableforthispublicinterestcriterionwillbecalculatedasfollows:

Figure4‐4:CO2ScoreCalculation

20

MWh

lbs

MWh

lbs

1

resourcegas

2

resource renewable

2

CO

CO

Score

Renewable generating facilities that do not emit any CO2 will receive the full 20 points, whilerenewablegeneratingfacilitiesthatemitCO2willreceivepointsbasedonthefactormultipliedbythe20points.SinceCO2emissionsaregenerallyconsideredtobeaglobalproblem,inthatCO2emissionsanywhereontheplanetcontributetoglobalwarming,whichaffectsthehealthandwelfareofthecitizensofIllinois,winddirection,duration,anddistancefromIllinois’sload‐weightedcenterarenotrelevantforthescoringofthiscriterionandarenotincludedinthecalculation.202

5. ContributingtoacleanerandhealthierenvironmentforthecitizensofthisState

Thiscriterionisarguablythemostsubjectiveinnature,andpresentsuniquechallengesgiventhattheAgencystrivestouseobjectiveapproachestothegreatestextentpossiblewhenconsideringthepublicinterestcriteria.Generallyspeaking,theAgencybelievesthatrenewableresourcesinherentlycontributetoacleanerandhealthierenvironmentgenerally(withthecaveatrelatedtoemissionsfrom renewable resources that involve combustion, discussed above) because they reduce thereliance on fossil fuels and have no safety issues generally associatedwith the containment anddisposalofradioactivematerialsofnucleargeneration.AtthistimetheAgencysuggeststhepointsawardedforthispublicinterestcriterionbetheaverageofthepointsawardedunderthefirstandfourthpublicinterestcriteriadescribedabove.Thisapproachwilltakeintoaccounttheemissionsfrom renewable resource facilities that involve combustion and, subsequently, emissions, whichwouldnotcontributetoacleanerandhealthierenvironmentforthecitizensofIllinois.

4.1.2. ApplicationProcessTheeligibilityof renewableenergycredits fromrenewableenergygenerating facilities located instatesadjacenttoIllinoisisnotautomaticallygranted,becausetheActrequiresthatapprovalcomesonly after “the generator demonstrates and the Agency determines” that the facility’s operationmeetsthepublicinterestcriteriadiscussedabove.203Thatdeterminationrequiresanactiverequest(demonstration)byaninterestedgenerator.Therefore,oncethisPlanisapproved,theAgencywillremove all out‐of‐state resources from eligibility for the Utility RPS in GATS and M‐RETS (thisremoval will not impact eligibility for the ARES RPS under Section 16‐115D of the PUA), and

202 The Agency notes that the Zero Emission Standard Plan contains a different scoring methodology for CO2 emissions, but thatmethodologyisbasedupontheimpactsofreplacementgenerationandtheconsiderationrelatedto“minimizingcarbondioxideemissionsthatresultfromelectricityconsumedinIllinois”(20ILCS3855/1‐75(d‐5)(1)(C)),whichisnotthesamestandardasunderconsiderationinqualifyingadjacent‐statefacilitiesfortheRPS.20320ILCS3855/1‐75(c)(1)(I).


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renewable generating facilities in adjacent statesmay apply to the Agency for consideration foreligibility.204

TheAgencywilldevelopanapplicationform(i.e.,aspreadsheet)forusebyownersofadjacent‐statefacilitiesthatwishtohaverenewableenergycreditsconsideredtobeeligiblefortheIllinoisRPS.Theinformation to be entered into the application form will at minimum include the generatingtechnology(includinginformationonemissionsratesifthetechnologyinvolvescombustion),statewhere thegenerator is located,distance fromMorris, IL, theRegionalTransmissionOrganization(“RTO”)wherethefacilityisorplannedtobeinterconnected(e.g.,PJM,MISO,SPP),andthetrackingsystemID(forexistingfacilities).Theapplicationformwillautomaticallycalculatethescoreforthefacility. In addition, the generatorwill also have to include information related to the provisionlimitingtherecoveryofcostsinratesdescribedinthenextSection.TheAgencywillupdatethedatausedintheeligibilitycalculationsonanannualbasistousethemostrecentavailableinputs,butafacility’sdeterminationofeligibilitywillbebasedonthedataavailableatthetimeoftherequestfordetermination(inotherwords,afacilitywouldnotriskhavingitseligibilityrevokedatalaterdateiftheinputschangedaftertheinitialeligibilitydeterminationismadebytheAgency).

TheAgencywillreviewapplicationstoverifytheinformationsubmitted(e.g.,confirmingthedistanceinputs),andifthefacilityhasascoreequaltoorgreaterthan60points(andmeetsthecostrecoveryrequirement),theAgencywillapprovethefacilityaseligibletoproducerenewableenergycreditsforcompliancewiththeIllinoisRPS.TheAgencywillinformtheapplicabletrackingsystem(GATSorM‐RETS)thatthefacility(andanyRECsitgeneratesafterthedeterminationismade)shouldbecodedasIllinoisRPSeligible.

Inthecaseofanewadjacent‐statefacilitythatisnotyetoperational(andthusalsonotregisteredinGATSorM‐RETS),anownermaysubmitarequestfordeterminationofeligibilitybasedupontheplanneddesignofthefacility.SuchasubmittalmustalsoincludedocumentationfromtheapplicableRTO(orutilityfordistributedresources)thatthefacilityhasenteredtheinterconnectionqueueandisactivelypursuinganinterconnectionagreement.IftheAgencydeterminesthattheplannedfacilitydoesmeetthepublicinterestcriteria,thenitwillgrantapre‐approvaloftheeligibility.Itwillbetheresponsibility of the facility owner to notify the IPA and the tracking system once the facility isoperationaltorequestbeingcodedaseligiblefortheIllinoisRPSintheapplicabletrackingsystem.The Agency will review final system information to verify consistency with the informationsubmittedforthepre‐approval.

4.2. CostRecoveryRequirementSection1‐75(c)(1)(J)oftheActcontainstheprovisionthat,

In order topromote the competitivedevelopment of renewable energy resources infurtheranceof the State's interest in thehealth, safety,andwelfareof its residents,renewable energy credits shall not be eligible to be counted toward the renewableenergyrequirementsofthissubsection(c)iftheyaresourcedfromageneratingunit

204Anexceptionwillbemadefortheout‐of‐statefacilitiesthathaveLTPPAcontractswiththeutilities.AsdiscussedinSection4.1,thosefacilitieswillbegrandfatheredintothisconsiderationandwillremaineligibletoprovideRECsforcompliancewiththeIllinoisRPS.


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whosecostswerebeingrecoveredthroughratesregulatedbythisStateoranyotherstateorstatesonorafterJanuary1,2017.

SimilarlanguagealsoappliestoRECsprocuredbyARESfortheirRPSobligations(“…shallnotincludeanyresourcesfromafacilitywhosecostswerebeingrecoveredthroughratesregulatedbyanystateorstatesonorafterJanuary1,2017”205).TheICCrecentlyupdatedrules206forARESRPScompliancetocomplywiththisnewstatutoryprovision(amongothers)207Aspartoftheprocessofimplementingthoserules,theAgencywillworkwithICCstafftoreviewfacilityeligibilityinGATSandM‐RETStomakereasonabledeterminationsofwhatexistingfacilitieswouldmeetthesecriteriaandwouldhaveRECseligibleforusebyARESfortheirRPScompliance.

Generallyspeaking,theAgencyunderstandsthatfacilitiesownedbyaruralelectriccooperativeoramunicipalutilitywouldnotbeimpactedbythiscriterion(asinIllinois,thoseentities’ratesarenotregulatedbythisstateoranyother),althoughtheAgencynotesthattherearecertainadjacentstateswhichregulatesomeruralelectriccooperativeandmunicipalutilityrates.Therefore,therewillnotbeablanketapprovaloffacilitiesownedbyruralelectriccooperativesormunicipalutilitiesserviceterritoriesinadjacentstates;rather,asthosefacilitiesrequesteligibility,theirraterecoverystatuswillbereviewed.

TheAgency also understands that this provisionwas generally intended to ensure that facilitiesownedbyaverticallyintegratedutility,forwhichRECrevenuesmaybeincidentaltobuildingandfinancingthefacility(asthatfacility’scostscouldberecoveredfromratepayersinthatotherstate,potentiallyresultinginacreditordiscounttothoseratepayersforanyRECrevenues—effectivelycausing Illinois ratepayers to cross‐subsidize those in vertically integrated states) would not beeligible.Ontheotherhand,themerepresenceofaPowerPurchaseAgreementbetweenafacilityandaseparateutilitywhosecostsarerecoveredinregulatedrateswouldnottriggerthesecriteria(norwouldparticipationintheIPA’senergyprocurementevents, forwhichregulatedutilitiesserveascontractualcounterparties,orparticipationinanetmeteringorsimilarenergycreditingprogram,whichwouldserve todisqualify thevery facilities thatotherportionsof the IllinoisRPSwork tosupport). Likewise, the Agency believes that being a Qualifying Facility under the Public UtilityRegulatoryPoliciesAct(“PURPA”)(andalsomeetingtheotheraspectsoftherequirementsoftheIllinoisRPS),wouldnotbedisqualifyingbecausetheQualifyingFacilitydoesnotdirectlyrecoveritscoststhroughrates;rather,itiscompensatedforitsenergyatthepurchasingutility’savoidedcostrate.

Additionally,theAgencyendeavorstoprovideconsistentapplicationofthisrateregulatedlanguageinmakingfacilitydeterminationsforboththeRPSunderSection1‐75(c)andalsoARESRPSeligibilityunderSection16‐115DofthePUA,andproposestoworkwithIllinoisCommerceCommissionStaff(withwhomtheAgencyhastraditionallymadeandislikelytobemakingjointdeterminationsonARESRPSfacilityeligibility)tothisend.

AftertheapprovalofthisPlanbytheCommission,theAgencywillrequestthatGATSandM‐RETShaveallfacilitiesoutsideofIllinoishavetheirRECeligibilityremovedforIllinoisutilityRPSpurposes.

205220ILCS5/16‐115D(a)(3.5)20683Ill.Adm.CodePart455.207TheCommission’sSecondNoticeOrderwasissuedAugust25,2017,andtheRuleswereapprovedbyJCARonOctober24,2017withaneffectivedateofOctober26,2017.


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(This change will not impact ARES RPS eligibility designations.) As described in Section 4.1.2,facilities located in adjacent states will proactively have to request eligibility for the utility RPSpursuanttothepublicinterestcriteriastandardexplainedabove.Thoserequeststomeetthepublicinterestcriteriawillalsoberequiredtoincludeanotarizedcertification,anddocumentation,thatthefacility does not have its costs recovered through regulated rates. For a distributed generationfacility, simpledocumentationof ownershipwould suffice. For larger facilities, theAgency is notproposingafirmstandardofdocumentationbutsuggeststhattherearemultipleapproachesthatcouldbeusedbyarequestingfacility.Theseinclude,butarenotlimitedto:

ForfacilitiestrackedinM‐RETS,documentationtosupportthestatuslistedinthe“FacilityOwnershipType”field

AMarketBasedRateauthorizationletterfromtheFederalEnergyRegulatoryCommissionthat demonstrates that the facility owner is not a utility with costs recovered throughregulatedrates

CertificationasaQualifyingFacility UseofinformationfromothersourcessuchastheS&PGlobalIntelligenceBriefingBook,or

thePlattsUDIDirectoryofElectricPowerProducersandDistributors

TheAgencywillreview(inconsultationwiththeICC)informationprovidedforafacility,andmay,asneeded,requestadditionalinformationinordertoverifyafacility’sstatus.

TheAgencyisnotawareofanyfacilitiesinIllinoisthathavetheircostsrecoveredthroughregulatedrates.

In addition to the screeningprocessdescribedabove, all contracts from future IPA‐administeredprocurementsorprogramswillcontainprovisionstoreflectthisadditionalrequirementofSection1‐75(c)(1)(J),

Eachcontractexecutedtopurchaserenewableenergycreditsunderthissubsection(c)shallprovideforthecontract'sterminationifthecostsofthegeneratingunitsupplyingthe renewable energy credits subsequently begin to be recovered through ratesregulatedby thisStateoranyother stateor states;andeachcontract shall furtherprovidethat,inthatevent,thesupplierofthecreditsmustreturn110%ofallpaymentsreceived under the contract. Amounts returned under the requirements of thissubparagraph(J)shallberetainedbytheutilityandalloftheseamountsshallbeusedfor theprocurement ofadditional renewable energy credits fromnewwind ornewphotovoltaicresourcesasdefinedinthissubsection(c).Thelong‐termplanshallprovidethattheserenewableenergycreditsshallbeprocuredinthenextprocurementevent.

TheAgencynotesthatSection1‐75(c)(1)(J)alsoprovidesalimitedexceptiontothisprovisionforfacilitiesthatparticipateintheIllinoisSolarforAllProgramoutlinedinSection1‐56oftheAct,

Notwithstanding the limitations of this subparagraph (J), renewable energy creditssourcedfromgeneratingunitsthatareconstructed,purchased,owned,orleasedbyanelectricutilityaspartofanapprovedproject,program,orpilotunderSection1‐56ofthisActshallbeeligibletobecountedtowardtherenewableenergyrequirementsofthissubsection(c),regardlessofhowthecostsoftheseunitsarerecovered.


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5. CompetitiveProcurementScheduleAsdescribedthroughoutthisChapter,tohelpmeetRPSgoalsoutlinedinSection1‐75(c)oftheIPAAct,theIPAproposestoconductavarietyofcompetitiveprocurementsforRECsincalendaryears2018and2019.IncombinationwiththeprogramsdescribedinChapters6,7,and8,subjecttoanylimitationscreatedbytheRPSbudgetcaps, thesecompetitiveprocurementsare intendedto fullymeet the RPS REC goals outlined in Sections 1‐75(c)(1)(B) and (C), and identified in Chapter 3,throughthe2019‐2020deliveryyears,andalsoprocureadditionalRECsunderlong‐termcontractstoprepareformeetingthegoalsforfuturedeliveryyears.

This Chapter contains proposals using two types of competitive procurements: ForwardProcurements, and Spot Procurements. For purposes of this Chapter, the Agency proposes thefollowingdefinitionstotheseprocurements:

A Forward Procurement is a competitive procurement for RECs where the beginningdeliverydateisinafuturedeliveryyearandthedeliverytermismultipleyears.Further,aForward Procurement is for unit‐specific RECs. Forward Procurements include thosespecifically outlined in the Act (e.g., a Subsequent Forward Procurement) and additionalForwardProcurementsproposedbytheIPAaspartofthisPlan.UnlessspecifiedotherwiseinthisChapter(i.e.,CommunityGenerationProgramForwardProcurementinSection5.8.4),ForwardProcurementswill,totheextentpracticable,followthemodelusedfortheInitialForwardProcurementincluding:

o 15‐yearREC‐onlycontractso PriceperRECfixedoverthetermofthecontract,nopriceescalationo AbilitytobankRECso Creditrequirementsandinstruments

ASpotProcurementisacompetitiveprocurementforRECsforeithertheprior,current,or

thepromptdeliveryyeargoals.ThedeliverytermofaSpotProcurementisonedeliveryyear.WhiletheIPAdoesnotbelievethePUAorIPAActrequiresthatspotprocurementproposalstrack exactly on the requirements of Section 16‐111.5, theAgency proposes that its spotprocurementswill, to the extent practicable, follow themodel the IPA has used for pastsimilarRECprocurementsincluding:

o FixedpriceperRECo RECsmustbefromapplicabledeliveryyearo Creditrequirementsandinstruments

AsdiscussedinChapter2,theAgencywillreviewandupdatethisPlanin2019inconjunctionwiththedevelopmentoftheAgency’s2020AnnualProcurementPlan,withthoseupdatesandrevisionstotakeeffectincalendaryear2020.Thescheduleofcompetitiveprocurementsoccurringafter2019willbeaddressedinthatPlanupdate.AdiscussionofthegeneralprinciplesforfuturecompetitiveprocurementsisdiscussedinSection5.10.


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5.1. StatutoryRequirementsSection16‐111.5(b)(5)(ii)(B)(aa)ofthePUArequiresthatthisPlan:

“Identify theprocurementprogramsand competitiveprocurement events consistentwiththeapplicablerequirementsoftheIllinoisPowerAgencyActandshallbedesignedtoachievethegoalssetforthinsubsection(c)ofSection1‐75ofthatAct.”

The“competitiveprocurementevents”contemplatedbytheIPAarediscussedinthisChapter,whilethe“procurementprograms”arediscussedinChapters6,7and8.Alsospecificallyaddressedinthischapter is the following additional provision (bb) of that subsection of the Act regarding RECprocurementssubsequenttotheInitialForwardProcurement:208

“Includeaschedule forprocurements forrenewableenergycredits fromutility‐scalewind projects, utility‐scale solar projects, and brownfield site photovoltaic projectsconsistentwithsubparagraph(G)ofparagraph(1)ofsubsection(c)ofSection1‐75oftheIllinoisPowerAgencyAct.”

Section16‐111.5(b)(5)(iii)furtherstatesthat,

“Forthoserenewableenergycreditssubjecttoprocurementthroughacompetitivebidprocessundertheplanorundertheinitialforwardprocurementsforwindandsolarresourcesdescribedinsubparagraph(G)ofparagraph(1)ofsubsection(c)ofSection1‐75oftheIllinoisPowerAgencyAct,theAgencyshallfollowtheprocurementprocessspecifiedintheprovisionsrelatingtoelectricityprocurementinsubsections(e)through(i)ofthisSection.”

WhileitisunclearwhetherprocurementssuchasthoseproposedinthisChapterarerequiredtobeconductedas“acompetitivebidprocess,”theAgencyhasachievedpositiveresultsinpastexperiencewithitscompetitivebidprocessand,outsideoftheprogramsitproposesinlaterChapters,seesnoneedtodeviatefromthisapproach.Section5.3discussesinmoredetailtheprocurementprocessspecified in Section 16‐111.5(e) through (i) conducted by the Agency for prior electricityprocurements,aswellaspriorrenewableenergyprocurements,andhowthisprocesswillbeappliedtothecompetitiveprocurementsproposedinthisPlan.209

208TheAgencynotes thatsubparagraph(G)also includes the InitialForwardProcurements thatweremandatedtobedevelopedandimplemented prior to the release of this Plan. The Agency therefore understands this provision to apply only to subparagraph (iii)regardingthe“SubsequentForwardProcurements.”209 The provisions related to this Plan contained in Section 16‐111.5 of the PUA and Section 1‐75(c)(1) of theAct generally refer to“competitiveprocurementprocesses”or“competitiveprocurementevents”whileinthisoneinstancethereisreferenceto“acompetitivebidprocess”thatshallfollowtheprocurementprocesscontainedinSection16‐111.5.However,thatprovisiononlyappliestotheInitialForward Procurement. Nonetheless,while the Agencymay have the discretion to conduct other competitive procurement processesthroughproceduresotherthanthoseenvisionedbySection16‐111.5(e.g.,ratherthanasealedbiddingwithpay‐as‐bidsettlement,offeringa standard offer price, or perhaps a single clearing price), at this time the Agency believes that all the competitive procurements itadministersshouldfollowtheframeworksetupbySection16‐111.5.


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5.2. BackgroundonpastRECProcurementsconductedbytheIPAIntheyears2009through2016,withtheexceptionsof2013and2014,210theIPAheldprocurementsfor renewable energy resources to meet the RPS requirements of the utilities’ eligible retailcustomers.Theseprocurementswereconductedthroughacompetitiveprocurementprocess.

While changes to Section 1‐75(c) of the IPA Act significantly increase the volume of RECs to beprocuredbytheAgency,theAgencyhasalongtrackrecordofprocuringrenewableenergyresources,predominantly RECs.211 The Agency’s past competitive procurements for renewable energyresources,resultedintheprocurementofthefollowingquantitiesofRECs:212

SpotProcurementsforone‐yeardeliveryofRECso 2009RECprocurementsforAmerenIllinoisandComEd(720,000RECsforAmeren

Illinois,1,564,360RECsforComEd)o 2010 REC procurements for Ameren Illinois and ComEd (860,860 RECs and

1,887,014RECsforAmerenIllinoisandComEd,respectively)o 2011 REC procurements for Ameren Illinois and ComEd (952,145 and 2,117,054

RECs)o 2012 REC procurements for Ameren Illinois and ComEd (523,376 RECs and

1,335,673RECs)o 2015SRECprocurementsforAmerenIllinoisandComEd(30,212SRECsand49,770

SRECs)o 2016SRECprocurementsforAmerenIllinoisandComEd(33,271SRECsand67,952

SRECs)o 2016RECprocurementforMidAmerican

ProcurementsformultipledeliveryyearsofRECs

o 2010Long‐termprocurements forAmeren IllinoisandComEd (20year contracts,bundled RECs and energy, 600,000 RECs per year and 1,261,725 RECs per year,respectively)

o 2012“RateStability”procurementforAmerenIllinoisandComEd(contractsforsixdeliveryyears)(429,425RECsperyearand299,672RECsperyear)

o 2015 Supplemental Photovoltaic procurements using the RERF (5 year contracts,withprovision to allow time for identificationof under25kWsystems) (187,160SRECsperyear)

o 2015DistributedGenerationprocurement forAmeren Illinois andComEd (5 yearcontracts)

o 2016SupplementalPhotovoltaicprocurementusingtheRERF(5yearcontracts,withprovisiontoallowtimeforidentificationofunder25kWsystems)(91,770SRECsperyear)

210IntheAgency’s2013ProcurementPlan,duetoadeclineofeligibleretailcustomers’loadservedbytheutilities,mainlyattributabletomunicipalaggregation,theAgencydetermined,andtheCommissionagreed,thatnonewprocurementsofrenewableenergyresources(orforthatmatterenergy)wererequired.SeeOrder,DocketNo.12‐0544,December19,2012,at109‐110.211Section1‐75(c)oftheActpriortothechangesenactedthroughPublicAct99‐0906focusedontheprocurementof“renewableenergyresources.”TherevisionstotheSectioncontainedinPublicAct99‐0906focustheLong‐TermRenewableResourcesProcurementPlanonspecificallyacquiring“renewableenergycredits”fromprogramsandcompetitiveprocurements.212 Announcements of these procurements that contain additional information can be found at:https://www.illinois.gov/sites/ipa/Pages/Prior_Approved_Plans.aspx.CertainRECvolumeinformationhavebeenredactedtomaintainrequiredconfidentialityinaccordancewith220ILCS5/16‐111.5(h).


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o 2016 Distributed Generation procurement for Ameren Illinois and ComEd andMidAmerican(5yearcontracts)

o 2017DistributedGenerationprocurements(5yearcontracts,alsoincludeprovisionto allow time for identification of under 25 kW systems)(19,549 SRECs per yearprocuredinSpring2017,8,153SRECsperyearprocuredinFall2017)

o 2017InitialForwardProcurement(15yearcontracts,1.165millionRECsperyearprocuredtodate,additional800,000SRECsperyeartobeprocuredbyMay31,2018)

5.3. UpdatestotheAgency’sCompetitiveProcurementApproachBasedonthispreviousRECprocurementexperience,theAgencyhasasolidfoundationtobuilduponforconductingthecompetitiveprocurementsproposedinthisPlan.Whilethespecificproductsanddelivery terms may vary from past procurements, the Agency believes that no significantmodificationstotheprocurementapproachitselfareneeded.Nonetheless,therearesomespecificitemsthatcanbeupdatedasdiscussedbelow.

The procurement approach the Agency has used for prior REC procurements stems from theapproachlaidoutinSection16‐111.5ofthePublicUtilitiesActforstandardwholesaleproduct(blockenergy,capacity,etc.)procurements.Itincludesthefollowingkeyprovisions:

Standardcontractsandcreditprovisions Sealedbidswithpay‐as‐bidsettlement Useofconfidentialbenchmarkstoeliminatebidsnotconsistentwiththemarket Bidselectionbasedonprice Nopost‐bidnegotiations ProcurementAdministratorevaluatesbidsandprovidesconfidentialrecommendationtothe

Commissionforapproval ProcurementAdministratorprovidebidderinterfaceincludingtraining Uniform/standardizedbidforms Uniform/standardized/harmonizedcreditrequirements ProcurementMonitorinvolvement

Theseprovisionsdefineaprocurementprocessthathasmultiplestages.

TheProcurementAdministratordevelopsdraftcontracts inconsultationwiththeutilities,theAgency,theProcurementMonitor,213andICCStaff.214

Draftcontractsarereleasedforpubliccomment. The Procurement Administrator, the Agency, the utilities, ICC Staff and the Procurement

Monitor review all comments received on the draft contract and revise the contract asneeded.215

Typically, theProcurementAdministratorholdsan informationalwebcastuponreleaseofthefinalcontractsandRFPrules.

SubmissionofProposalsisintwoparts:

213 The Procurement Monitor is an independent consultant who works on behalf of the Commission to oversee all aspects of theprocurementprocess.220ILCS5/16‐111.5(c)(2).214TheAgencyexpectsthatthecontractwillbebasedonamodifiedABA‐EMA‐ACORERECPurchase&SaleAgreement.215IfagreementbetweentheProcurementAdministratorandtheutilitiesisnotreachedonthetermsandprovisionsofthecontracts,anydisputesareresolvedbytheCommission.(See220ILCS5/16‐111.5(e)(2)).


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o Part1forpre‐qualification–allowsbidderstoprovidebasicinformation,andagreetothetermsofthecontractandtheRFPrules.

o Part 2 for registration of bidders – allows bidders to update information, makeadditionalcertifications includingregardingconfidentialityofbidding information,andpostbidassurancecollateral.

Bids–onthebiddate,bidderssubmitbidsusingastandardizedbidform. Evaluation of Bids – the Procurement Administrator evaluates bids based on price,

procurement objectives and priorities; identifies the winning bids; prepares arecommendationfortheCommission.TheProcurementMonitorobservesthebiddingandevaluationprocessandmakesitsownrecommendation.216

Commissiondecision–AfterreviewoftheProcurementAdministrator’sandProcurementMonitor’sreportsandrecommendations,theCommissionrendersadecisionontheresultsoftheprocurementevent.217

Releaseofprocurementresults–TheProcurementAdministratorreleasestheresultsoftheprocurementevent;confidentialinformationisprotected.218

Contractexecutionwiththeutilities–WithinthreebusinessdaysofCommissionapprovaloftheprocurementresults,utilitiesandwinningbidderssignbindingcontractualarrangementsusingthestandardformcontracts.219

Unless specifically noted in the following sections, the IPA proposes that the competitiveprocurementsforRECsproposedinthisPlanfollowthesepastpracticesthathavebeenrefinedoverthepasteightyears.

5.4. RevisedRECEligibilityChanges in theRPSwill requireseveralchanges to the IPA’sapproach toconductingcompetitiveprocurements.Themostsignificantchangeisthattheuniverseofeligiblefacilities,andthuseligibleRECs,haschangedsignificantly.Priorto2011,thestandardwas:

“ResourcesprocuredpursuanttothisSectionshallbeprocuredfromfacilitieslocatedinIllinois,providedtheresourcesareavailablefromthosefacilities.IfresourcesarenotavailableinIllinois,thentheyshallbeprocuredinstatesthatadjoinIllinois.IfresourcesarenotavailableinIllinoisorinstatesthatadjoinIllinois,thentheymaybepurchasedelsewhere.”

After2011,thestandardchangedto:

“ResourcesprocuredpursuanttothisSectionshallbeprocuredfromfacilitieslocatedinIllinoisorstatesthatadjoinIllinois.IfresourcesarenotavailableinIllinoisorinstatesthatadjoinIllinois,thentheymaybeprocuredelsewhere.”220

Thisallowedthe IPA torunprocurements that featuredabidselectionprocesswherebidswereselectedonthebasisofpriceinaseriesofpreferentialcategoriesthatreflectedlocationalpriorities.

216See220ILCS5/16‐111.5(f).217Seeid.218See220ILCS5/16‐111.5(h).219See220ILCS5/16‐111.5(g).220Bothprovisionswerecontainedinthepriorprovisionsof20ILCS3855/1‐75(c)(3)repealedandreplacedeffectiveJune1,2017throughPublicAct99‐0906.


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Ascanbeseeninthepublicnoticesofwinningbiddersfrompastprocurementresults,221RECswereprocuredinthecategories,“Illinoisandadjoiningstates”and“otherstates.”

Starting June1,2017,under the revisedRPSenacted throughPublicAct99‐0906, thisparadigmchanged again and the pool of potentially eligibleRECs has shrunk significantly. As discussed inChapter 4, two new conditions have been placed on RECs that are eligible to be used for RPScompliance.FirstisalocationalstandardthatallowsRECsfromfacilitieslocatedinIllinois,andfromfacilitieslocatedinadjacentstatesonlyiftheymeetthepublicinterestcriteriasetoutinSection1‐75(c)(1)(I)(asexplainedinChapter4above).Byimplication,RECsfromstatesfurtherafieldthanthestatesadjacenttoIllinoisdonotqualifyfortheIllinoisRPS.Second,astandardrelatedtohowgeneratingunitsrecovertheircostsnotonlylimitsRECstothosefromgeneratingunitsthatdonotrecovertheircoststhroughregulatedrates,butalsoassessespenaltiesforRECsfromsystemslaterfoundtobenon‐compliant.(SeeSection1‐75(c)(1)(J)oftheIPAAct).222

TheseneweligibilityrequirementswillrequirecompetitiveprocurementsconductedbytheIPAtofeatureadditionalstepstoverifythatRECsbeingprocuredareeligiblefortheIllinoisRPS.Howthismanifestsitselfwilldependonthetypeofprocurementbeingconducted.ForForwardProcurements,additionalreviewmayberequiredduringthebidderregistrationprocesstoallowtheProcurementAdministratorandtheAgencytoverifyinformationaboutproposedfacilitiesandiffacilitieslocatedinthestatesadjacenttoIllinoismeetthepublicinterestcriteria(forexample,seeChapter4formoreinformationonhow facilitieswould request thisdetermination).ForSpotProcurements, suchasthoseproposedinSection5.9below,therewillnotbethesamelevelofinitialscreeningofeligibilitybecausetheSpotProcurementsarenotunit‐specific,buttheprocurementrulesandcontractswillclearlystatethattheobligationandresponsibility(andpotentiallypenalties)ofdeliveringeligibleRECs(ascodedeligibleinGATSorM‐RETS)willresidewiththewinningsuppliers.

5.5. CreditRequirementsToensure thatRECsundercontract toserveacompliancerequirementare indeeddelivered, theAgency proposes to continue requiring collateral with contracts, with the collateral amountestablishedasafunctionofcontractvalue.Whilespecificcollaterallevelsarenotproposedaspartofthis Plan (and are generally determined through the contract development process), the Agencybelievesthatthelevelofcollateralmustbelowenoughtoencourageparticipationandhighenoughtodiscouragesupplierstovoluntarilydefaultoncontracts foreconomicreasons.Further, theIPAproposes a strict requirement that suppliers and associated facilitieswho voluntarily default oncontractsforeconomicreasonsormisrepresenttheireligibilitytoparticipateinaprocurementeventwillbebarredfromparticipationinfutureIPAprocurements.

5.6. BenchmarksPriortotherevisionstotheRPScontainedinPublicAct99‐0906,benchmarksusedforrenewableenergy resources procurements (i.e., confidential price levels above which no bids would beaccepted) were developed pursuant to a statutory provision requiring that the price paid forrenewableenergyresourcesbeingprocured “notexceedbenchmarksbasedonmarketprices for221See:https://www.illinois.gov/sites/ipa/Pages/Prior_Approved_Plans.aspxforpastIPAprocurementresults.222NotethatSection1‐75(c)(1)(I)references“facility”and“facilities”forthegeographicstandard,whileSection1‐75(c)(1)(J)references“generatingunit”forthecostrecoverystandard.Section1‐10oftheIPAActdoesnotspecificallydefine“generatingunit”butdoesdefineafacilityas,“anelectricgeneratingunitoraco‐generatingunitthatproduceselectricityalongwithrelatedequipmentnecessarytoconnectthefacilitytoanelectrictransmissionordistributionsystem.”TheAgencyunderstandsthesetermstoberoughlyinterchangeable.


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renewableenergyresourcesintheregion,”andrequiredthatsuchbenchmarks“bedevelopedbytheprocurement administrator, in consultation with the Commission staff, Agency staff, and theprocurementmonitor”and“subjecttoCommissionreviewandapproval.”223

FortheprocurementstobeconductedundertherevisedSection1‐75(c)asdescribedinthisPlan,the concept of being cost effective for the competitive procurement of RECs has been revised.Specifically,throughchangesbyP.A.99‐0906,“cost‐effective”nowmeansthatthepricesforRECs

donotexceedbenchmarksbasedonmarketpricesforlikeproductsintheregion.Forpurposesofthissubsection(c),"likeproducts"meanscontractsforrenewableenergycreditsfromthesameorsubstantiallysimilartechnology,sameorsubstantiallysimilarvintage(neworexisting),thesameorsubstantiallysimilarquantity,andthesameorsubstantiallysimilarcontractlengthandstructure.Benchmarksshallbedevelopedbytheprocurementadministrator,inconsultationwiththeCommissionstaff,Agencystaff,andtheprocurementmonitorandshallbesubjecttoCommissionreviewandapproval.Ifpricebenchmarksforlikeproductsintheregionarenotavailable,theprocurementadministrator shall establishprice benchmarks based on publicly availabledata onregionaltechnologycostsandexpectedcurrentandfutureregionalenergyprices.224

Due to the sensitive nature of the benchmark development process and how the release ofinformation related to the level of the benchmark could impact bidder behavior in competitiveprocurements,thisPlanwillnotprovideadditionalinformationontheprocessfordevelopingthebenchmarkoranyrangeofpotentialbenchmarkprices.

ThesebenchmarksarenottobeusedtocurtailorotherwisereducecontractualobligationsenteredintobyorthroughtheAgencypriortoJune1,2017.225

5.7. ProcurementsforRECsfromNewProjectsvs.RECstoMeetAnnualGoalsSection1‐75(c)(1)(F) creates a prioritization order forRECprocurements, to the extent that the“budget”ofutility‐collectedfunds,pursuanttoSections1‐75(c)(1)(E)and1‐75(c)(6)oftheActandSection16‐108(k)ofthePublicUtilitiesAct,becomesabindingconstraint:

1. RECsunderexistingcontractualobligations;2. RECsprocuredthroughfundingfortheIllinoisSolarforAllProgram;3. RECs necessary to comply with the new wind and new photovoltaic procurement

requirementsdescribedinitems(i)through(iii)ofsubparagraph(C)ofthisparagraph(1)[ofSection1‐75oftheIPAAct];226

4. RECsnecessarytomeettheremainingrequirementsofthissubsection(c).

Chapter 3 describes a substantial gap between the quantity of RECs needed to meet annualpercentageRPSgoalsandtheRECsfrompriorprocurementsthatarealreadyundercontractorwillbebroughtundercontractthroughtheInitialForwardProcurement.Takingintoconsiderationthe

22320ILCS3855/1‐75(c)(1)repealedeffectiveJune1,2017.22420ILCS3855/1‐75(c)(1)(D).225Id.226Theprovisionsarefor2,000,000RECsbytheendofthe2020‐2021deliveryyear,3,000,000RECsbytheendofthe2025‐2026deliveryyear,and4,000,000RECsbytheendofthe2030‐2031deliveryyear.


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RECprocurementprioritiesdiscussedabove,tomeettheannualRPSpercentagegoals,theAgencyproposestofirstsatisfythenewwindandphotovoltaicrequirements.ThentheAgencywillseektomeettheremainingrequirementsofSection1‐75(c)(whichtheIPAunderstandstoreferprimarily,ifnotexclusively,tothepercentage‐basedgoalsfoundinSection1‐75(c)(1)(B)).

WithintheproposalstomeettheremainingrequirementsofSection1‐75(c)(aftertheprocurementofRECsfromnewwindandphotovoltaicprojects),theAgencywillprioritizeForwardProcurementsforRECsfromnewprojectsoverSpotProcurements.Whileatleast75%ofRECscomemustfromwindandsolarprojects,227suchprocurementswouldsolicitRECsfromotherrenewablegeneratingtechnologiesaswell.

TheIPAproposestoimplementthecompetitiveprocurementssummarizedinTable5‐1andTable5‐2below.Adescriptionofeachoftheseprocurements followsinSections5.7.1through5.9.TheProcurementDateslistedaretentativedatesandmaybeadjustedbytheAgencyifneeded.WhiletheAgency will strive to keep to this procurement schedule, unforeseen circumstances could delayprocurements.Likewise,ifitisfeasibletoholdaprocurementearlierthanplanned(butnotmorethanonecalendarquarter),theAgencymayacceleratethescheduleforcertainprocurements.TheAgencywillannounceanychangestoprocurementdatesatleastthreemonthspriortotheearlierofthescheduledorreviseddate.228

22720ILCS3855/1‐75(c)(1)(C).228Forthepurposesofthisschedule,theprocurementdatereferstothecommencementoftheprocessforthespecificprocurement,andnotthebiddate.


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Table5‐1:2018and2019ForwardProcurementsSummary

Section Procurement Technology Type229

ProcurementDate

Term DeliveryStart

AnnualRECTarget230

5.7.1 FirstSubsequentForward

Wind(utility‐scale)

New Summer2018 15Years

2020‐2021 1.035million

5.7.2 BrownfieldSiteForward

Photovoltaic(brownfieldsite)

Any Summer2018 15Years

2020‐2021 0.08million231

5.8.1 PhotovoltaicForward

Photovoltaic(utility‐scale)

New Spring2019 15Years

2020‐2021 1millionminimum232

5.8.2 SecondSubsequentForward233


New Fall2019 15Years

2021‐2022 1millionminimum234

5.8.3 OtherRenewablesForward235

Anyotherthanwind/photovoltaic


2020‐2021orlater

Tobedetermined236

5.8.4 CommunityRenewableGenerationProgramForward

Anynon‐photovoltaic(withsubscribers)


2020‐2021orlater

Tobedetermined237

8.6.4 Low‐IncomeCommunitySolarPilotProject

Photovoltaic(withcommunityparticipation/subscribers)

New Tobedetermined(tentativelylate2018orearly2019)

15Years

Tobedetermined

Basedonavailablebudget

229TypereferstowhetherthegeneratingfacilitythatproducestheRECsisneworexisting.“Any”meansthateithertypeisacceptable.230AllRECTargetsaresubjecttoavailableRPSbudgetlimitations.231TobeconfirmedbasedontheresultsoftheInitialForwardProcurement,upto0.08millionRECstomeetthe2%requirementforthe2025deliveryyear.232ThefinaltargetRECvolumeforthisprocurementwillbesetinearly2019.233Contingentuponwhethersufficientphotovoltaicsareprojectedtobeprocured.234ThefinaltargetRECvolumeforthisprocurementwillbesetinearly2019.235TobeheldbasedonRequestforInformationresponses.236The final targetRECvolume for thisprocurementwill be set in early2019basedon theperformanceof otherprocurements andprograms,marketfeedback,andanalysisofexpectedavailablebudget.237The final targetRECvolume for thisprocurementwill be set in early2019basedon theperformanceof otherprocurements andprogramsandanalysisofexpectedavailablebudget.


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Table5‐2:2018and2019SpotProcurementsSummary

Section Procurement Technology Type238

ProcurementDate

Term DeliveryStart

AnnualRECTarget239

5.9 2018SpringSpot

Any240 Any Spring2018 OneYear

2017‐2018

7.5million241

5.9 2018SummerSpot

Any242 Any Summer2018 OneYear

2018‐2019

12.9million(est.)243

5.9 2019SummerSpot

Any244 Any Summer2019 OneYear

2019‐2020

16.3million(est.)245

5.7.1. FirstSubsequentForwardProcurementProcurement Technology Type

246ProcurementDate

Term DeliveryStart

AnnualRECTarget247

FirstSubsequentForward Wind(utility‐scale)

New Summer2018 15Years 2020‐2021 1.035million

ThefirstroundoftheInitialForwardProcurement,conductedbytheAgencyinAugust2017,selected(but did not precisely procure) 1,000,000 annual RECs from newwind projects (“annual RECs”meaningthequantityofRECstobedeliveredannuallyundertheresultingRECdeliverycontracts).248It alsoprocured200,000annualRECs fromnewphotovoltaicprojects.Theseprojectsmust startdeliveryofRECsbyJune1,2021.(TheAgencyisplanningadditionalroundsoftheInitialForwardProcurement to procure the remaining 800,000 RECs from utility‐scale and brownfield sitephotovoltaicprojects.TheseprocurementswillbeconcludedbyMay31,2018.)

238TypereferstowhetherthegeneratingfacilitythatproducestheRECsisneworexisting.“Any”meansthateithertypeisacceptable239AllRECTargetsaresubjecttoavailableRPSbudgetlimitations.240Subjecttotherequirementthat75%ofoverallRECsforthedeliveryyeararefromwindorphotovoltaic.241QuantityneededtomeetthedeliveryyearRPSGoal.242Subjecttotherequirementthat75%ofoverallRECsforthedeliveryyeararefromwindorphotovoltaic.243EstimatedquantityneededtomeetthedeliveryyearRPSGoal.Finalquantitywillbebasedon2017‐2018actualdeliveredenergy,andcontractedvolumesexpectedfordeliveryinthisdeliveryyear.244Subjecttotherequirementthat75%ofoverallRECsforthedeliveryyeararefromwindorphotovoltaic.245EstimatedquantityneededtomeettheDeliveryYearRPSGoal.Finalquantitywillbebasedon2018‐2019actualdeliveredenergy,contractedvolumesfordeliveryinthisdeliveryyear,andexpectedRECdeliveriesassociatedwiththeAdjustableBlockProgram.246Typereferstowhetherthegeneratingfacilityisneworexisting.247RECTargetissubjecttoavailableRPSbudgetlimitations.248965,000RECswereultimatelyprocuredduetoonebidder’srejectionofapartialawardafterapprovalbytheCommission.


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Section1‐75(c)(1)(C)(ii)specifiesthatbytheendofthe2020‐2021deliveryyear(May31,2021),atleast2,000,000RECsusedtomeettherequirementsoftheIllinoisRPSaretobedeliveredannuallyfromnewwindprojects,andlikewisethatatleast2,000,000RECsaretobedeliveredannuallyfromnewphotovoltaicprojects.249Itfurtherspecifiesthatatleast50%ofthosephotovoltaicRECs(i.e.,atleast1,000,000RECs)aretocomefromprojectsdevelopedthroughtheAdjustableBlockProgramdescribedinChapter6,that40%ofthephotovoltaicRECs(atleast800,000RECs)aretocomefromutility‐scaleprojects,andthattheAgencydeterminethroughthisPlanhowtheremainder(200,000RECs)aretobeprocured.Section1‐75(c)(1)(C)(ii)alsospecifiesthat2%ofthephotovoltaicRECs(at least 40,000 RECs) be procured from brownfield site photovoltaic projects that are notcommunitysolar.

Forpresentplanningpurposes,theAgencywillassumethattheadditionalroundsofthephotovoltaicInitial Forward Procurement meet their targets, and that the projects from the Initial ForwardProcurementaresuccessfullydeveloped,energized,andbegindeliveringtheirannualquantitiesofRECsbytheirstatutorydeadline.Underthisapproach,theinitialforwardprocurementswillmeet965,000outof the2,000,000RECgoal fornewwindprojects.Fornewphotovoltaicprojects, the1,000,000RECsfromutility‐scalesolarprojectsthroughtheInitialForwardProcurementwillexceedthe40%ofRECsfromnewutility‐scalesolarprojectsrequirement(800,000RECs),andtheAgencyviewstheadditional200,000RECsfromutility‐scalesolarprojectsascontributingtothe8%portionofthe2,000,000newphotovoltaicRECsbythe2020‐2021deliveryyearforwhichtheAgencyhasdiscretiononhowtoprocure.

Therefore, the Agency will need to conduct an additional procurement of RECs from newwindprojects to meet the 2,000,000 REC goal. To do so, the Agency proposes to conduct its FirstSubsequentForwardProcurementforRECsfromnewutility‐scalewindprojectstobeheldpursuanttoSection1‐75(c)(1)(G)(iii).ThatsectionoutlinesseveralrequirementsforaSubsequentForwardProcurement:

The procurement must be for “at least 1,000,000 renewable energy credits deliveredannuallyperprocurementevent.”

The procurement “shall be planned, scheduled, and designed such that the cumulativeamountofrenewableenergycreditsdeliveredfromallnewwindprojectsineachdeliveryyearshallnotexceedtheAgency'sprojectionofthecumulativeamountofrenewableenergycreditsthatwillbedeliveredfromallnewphotovoltaicprojects,includingutility‐scaleanddistributedphotovoltaicdevices, inthesamedeliveryyearatthetimescheduledforwindcontractdelivery.”

AtthetimeofthedevelopmentofthisPlan,theAgency’sprojectionisthataprocurementofatleast1,035,000 additional RECs from new wind projects through the First Subsequent ForwardProcurementcanproceedbecausetheresultingcumulativeamountofRECsfromnewwindprojectsprocured in any given future delivery year would not exceed the Agency’s projection of thecumulativeamountofRECsthatwillbedelivered fromallnewphotovoltaicprojects in thesamedeliveryyear.

249ForthepurposesofthisChapter,referencestoRECquantitiesshouldbeunderstoodtomeananannualdeliveryquantityseparatefromthelengthofthecontractunderwhichRECsaredelivered.


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TheFirstSubsequentForwardProcurementforRECsfromnewutility‐scalewindprojectswill,totheextentpracticable,followtheapproachesusedbytheIPAinpreviousprocurementsincludingtheInitialForwardProcurement.TheAgencyunderstandsthattobeconsidereda“newwindproject,”afacility must be energized within three years of the Commission’s approval of the procurementresults.SeeSection2.4.2foradditionaldiscussionofthisissue.250

In order tomaximize federal tax incentives (reducingpotentialRECprices) and tomaximize thelikelihoodthatprojectswillbecompletedbytheendofthe2020‐2021deliveryyear,theSubsequentForwardProcurementwillbeheldinthesummerof2018.

5.7.2. BrownfieldSiteForwardProcurementProcurement Technology Type

251ProcurementDate

Term DeliveryStart

AnnualRECTarget252

BrownfieldSiteForward

Photovoltaic(brownfieldsite)

Any Summer2018 15Years 2020‐2021 0.08million253

ThefirstroundoftheInitialForwardProcurementconductedinAugust2017didnotprocureanyRECsfromnewbrownfieldsitephotovoltaicprojects,andtheAgencyhasnototherwiseprocuredany RECs that would satisfy the brownfield site photovoltaic project requirement. While thebrownfield site photovoltaic target could be met through the Initial Forward Procurement, it isunclearwhetherthefutureroundsoftheInitialForwardProcurementwillprocuresufficient(orany)RECstomeetthebrownfieldsitephotovoltaicgoal.GiventheemphasisthatP.A.99‐0906gavetoencouragingbrownfieldsitephotovoltaics(forexample,addingtothe“Legislativedeclarationsandfindings”sectionoftheIPAActanewprovisionstatingthat“[d]evelopingbrownfieldsolarprojectsinIllinoiswillhelpreturnblightedorcontaminatedlandtoproductiveusewhileenhancingpublichealthandthewell‐beingofIllinoisresidents”254),theIPAbelievesthatprocuringanamountgreaterthanthe2020quantitativetargetofRECsfrombrownfieldsitephotovoltaicprojectsisconsistentwiththelaw’sintent.Asproposed,thisprocurementwouldseektoacceleratethedevelopmentofbrownfieldsitephotovoltaicprojectswiththegoaltomeetthe2025brownfieldsitetarget(80,000RECsversusthe2020targetof40,000RECs).Ifthe80,000RECbrownfieldsitephotovoltaicgoalismetthroughtheInitialForwardProcurement,theAgencyproposesthatnoadditionalprocurementsspecificallydesignedtoprocureRECsfrombrownfieldsitephotovoltaicprojectsbeconductedduringthecalendaryears2018or2019.

250Inaddition,theAgencynotesthatitwouldgenerallynotconsiderarepoweredwindfarma“newwindproject”forpurposesofSection1‐75(c)(1)(C) of the IPA Act. Providing an incentive for existing generation to simply repower for increased efficiency would beinconsistentwithstatutorydirectivesencouragingthedevelopmentof“new”projectsto“todiversifyIllinoiselectricitysupply,avoidandreducepollution,reducepeakdemand,andenhancepublichealthandwell‐beingofIllinoisresidents”(20ILCS3855/1‐75(1‐5)(6)),astheincrementalbenefitsofferedtoIllinoisresidentsbyarepoweredprojectwouldbesignificantlylessthanthoseofferedbyanentirelynewfacility.251Typereferstowhetherthegeneratingfacilityisneworexisting.252RECTargetissubjecttoavailableRPSbudgetlimitations.253TobeconfirmedbasedontheresultsoftheInitialForwardProcurement,upto0.08millionRECstomeetthe2%requirementforthe2025deliveryyear.25420ILCS3855/1‐5(8).


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However,ifaftertheconclusionoftheInitialForwardProcurement,the80,000RECtargetfornewbrownfield site photovoltaic projects has not beenmet, then the Agency proposes to conduct aForwardProcurementincalendaryear2018forRECsfromnewbrownfieldsitephotovoltaicprojectstomeetthe2025deliveryyeargoal.

5.8. OtherProcurementstoMeetRPSTargetsAssuming that the Initial Forward Procurement, as well as the First Subsequent ForwardProcurement for newwindRECs,meet their target procurement quantities, and further that theAdjustableBlockProgramalsomeetsitsprojectedprocurementtargetof1millionRECsperyear,4millionRECsperyearwillhavebeenprocuredbytheendoftheSummerof2020throughcontractswithmulti‐year delivery obligations.255 In addition, about 1.9million RECs per year are alreadyscheduled to be delivered under existing contracts256 for the 2019‐2020 delivery year. This 5.9millionRECsperyearfromprocurementsandprogramsspecificallymandatedintheIPAActfallswell short of the annual percentage‐based RPS goals. The IPA estimates that unless additionalprocurementsareconductedincalendaryears2018and2019,forthedeliveryperiodof2019‐2020and beyond, the annual REC shortagewould be in excess of 16million. (Forward ProcurementswouldnottobeabletomeetRECGoalsforthe2017‐2018orthe2018‐2019deliveryyears;SpotProcurementsasdiscussedbelowwillinsteadbeusedforRPSgoalsforthoseyears.)

Tohelpclosethisgapandmeetthepercentage‐basedgoalsoftheRPSfoundinSection1‐75(c)(1)(B)of the IPA Act, the Agency must also offer proposals to procure additional RECs. The followingsectionsoutlineadditionalproposedprocurements.

5.8.1. PhotovoltaicForwardProcurementProcurement Technology Type

257ProcurementDate

Term DeliveryStart AnnualRECTarget258

PhotovoltaicForward

Photovoltaic(utility‐scale)

New Spring2019 15Years 2020‐2021 1millionminimum

FollowingtheFirstSubsequentForwardProcurementdiscussedinSection5.7.1andtheBrownfieldForwardProcurementdiscussed inSection5.7.2, thenextconsideration for theAgency ishowtoexpand the number of RECs procured from new photovoltaics projects. A procurement forphotovoltaicRECswilllikelybenecessarytoconductpriortoconsideringadditionalprocurementsfor new wind RECs after the First Subsequent Forward Procurement because of the statutoryrequirement for the Agency to balance RECs from new wind projects with those from newphotovoltaicprojects.Section1‐75(c)(1)(G)(iv)statesinpartthat,

2551,000,000newwindRECsfromtheInitialForwardProcurement,1,000,000newwindRECsfromtheSubsequentForwardProcurement,1,000,000 new photovoltaic RECs from the Initial Forward Procurement (of which some may be from brownfield site photovoltaicprojects),and1,000,0000RECsfromtheAdjustableBlockProgram.256TheLong‐TermPowerPurchaseAgreementsdatingfrom2010.257Typereferstowhetherthegeneratingfacilityisneworexisting.258RECTargetissubjecttoavailableRPSbudgetlimitations.ThefinaltargetRECvolumeforthisprocurementwillbesetinearly2019.


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If[…]thecumulativeamountofrenewableenergycreditsprojectedtobedeliveredfromall new wind projects in a given delivery year exceeds the cumulative amount ofrenewableenergycreditsprojectedtobedeliveredfromallnewphotovoltaicprojectsinthatdeliveryyearby200,000ormorerenewableenergycredits,thentheAgencyshallwithin60daysadjusttheprocurementprogramsinthelong‐termrenewableresourcesprocurementplantoensurethattheprojectedcumulativeamountofrenewableenergycredits to be delivered from all new wind projects does not exceed the projectedcumulative amount of renewable energy credits to be delivered from all newphotovoltaic projects by 200,000 ormore renewable energy credits, provided thatnothing inthisSectionshallprecludetheprojectedcumulativeamountofrenewableenergycreditstobedelivered fromallnewphotovoltaicprojects fromexceedingtheprojectedcumulativeamountofrenewableenergycreditstobedeliveredfromallnewwindprojectsineachdeliveryyearandprovidedfurtherthatnothinginthisitem(iv)shallrequirethecurtailmentofanexecutedcontract.

TheInitialForwardProcurementisexpectedtoprocure1,000,000RECsannuallyfromnewutilityscaleandbrownfieldsitephotovoltaicprojects;itwillbecompletedinthefirsthalfofcalendaryear2018.AssumingtheAdjustableBlockProgramreachesitstargetof1,000,000RECs,then2,000,000RECsannuallyfromnewphotovoltaicprojectswillhavebeenprocured.UnlikeforRECsfromnewwindprojects,whereSection1‐75(c)(1)(G)(iii)describestheutilizationofa“SubsequentForwardProcurement” tomeet futureyears’ targets, the law issilentas to theapproach taken toprocureadditionalRECsfromnewutility‐scalephotovoltaicprojectsaftertheInitialForwardProcurement.

ThematchingrequirementsforRECsfromnewwindandnewphotovoltaicprojectsalsoreferencesbothutility‐scaleanddistributedgeneration/communityrenewablegenerationphotovoltaics.IftheAdjustableBlockProgramonlyprocures1,000,000RECsbytheendofthe2020‐2021deliveryyear,moreRECsfromnewphotovoltaicprojectswillbeneededtomatchthequantityofRECsfromnewwind projects that go beyond the initial 2,000,000 newwind REC goal from the Initial ForwardProcurementandtheFirstSubsequentForwardProcurement.ThoseadditionalRECsfromnewwindprojects would be procured through the Second Subsequent Forward Procurement of at least1,000,000newwindRECsasdescribedinSection5.8.2below.Thepurposeofgoingbeyondtheinitialtargetsof2,000,000RECseachfornewwindandnewphotovoltaicsistohelpensurealong‐termsupplyofRECstomeettheincreasingannualRPSpercentagegoalsthatriseto25%in2025(aswellastoanticipatethenexttargetof3,000,000RECsfromeachcategoryby2025).WhiletheAdjustableBlockProgrammaywellexceedexpectations,itislikelythatanadditionalutility‐scalephotovoltaicRECprocurementwillberequiredtohelpmeetthistarget.

The Photovoltaic Forward Procurement proposed herein for annual delivery of aminimum of 1millionRECsfromnewutility‐scalephotovoltaicprojectswouldbeconductedinearly2019.ThefinaltargetRECvolumeforthisprocurementwillbesetinearly2019baseduponareviewoftheresultsoftheAdjustableBlockProgramandadeterminationoftheRECquantitythatwouldbeneededtoallowfortheSecondSubsequentForwardProcurement(describedinthenextsection)fornewwindRECstoproceed.Atminimum,thetargetprocurementvolumeshouldbe1millionRECsdeliveredannually,buttheAgencymayadjustthatamountbecauseunlesstheAdjustableBlockProgramisontracktoproducesubstantiallymorethan1millionRECsbythe2020‐2021deliveryyear,procuringannualdeliveriesoffewerthan1millionRECsthroughthePhotovoltaicForwardProcurementcouldentailinsufficientRECstoallowtheSecondSubsequentForwardProcurementfornewwindRECsto


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proceed.ThetargetprocurementvolumeforthePhotovoltaicForwardProcurementwillbesettohelp ensure that the Second Subsequent Forward Procurement can occur. The Agency will alsoconsider increasing the target volume if, after reviewing the results of the Initial ForwardProcurement,itdeterminesthereisahighlikelihoodofprocuringmorethantheannualdeliveryof1millionnewphotovoltaicRECs.

5.8.2. SecondSubsequentForwardProcurementProcurement Technology Type

259ProcurementDate

Term DeliveryStart

AnnualRECTarget260

SecondSubsequentForward


New Fall2019 15Years 2021‐2022 1millionminimum

IfavailablebudgetsandprojectedRECsfromnewphotovoltaicprojectsaresufficienttoallowforanadditionalSubsequentForwardProcurement,theAgencyproposestoconductaSecondSubsequentForwardProcurement.Thisprocurementwouldbeconducted inthefallof2019andwillseektoprocureRECsfromnewwindprojects.ItwouldalsofollowthemodeldescribedinSection5.7.1.ThefinaltargetforthisSecondSubsequentForwardProcurementcouldbeadjustedupfrom1millionRECsiftheprojectedquantityofRECsfromnewphotovoltaicprojectsissufficienttomaintainthenewwind targetwithin 200,000RECsper year of the newphotovoltaic targets. TheAgencywillreviewtheresultsoftheAdjustableBlockProgramandthePhotovoltaicForwardProcurementtomakethisdetermination.

ThisSecondSubsequentForwardProcurementfromnewwindprojectswouldonlyoccurifatleast2.8millionnewphotovoltaicRECsareprojectedtobeprocuredbytheendofthe2020‐2021deliveryyear.ThislimitationexistsbecauseeachoftheInitialForwardProcurement,SubsequentForwardProcurement,andSecondSubsequentForwardProcurementmustbeforatleast1millionRECs261fromnewwindprojects,underSections1‐75(c)(1)(G)(i)and(iii)oftheAct.Forafurtherexample,ifthe projectionwere3.2millionnewphotovoltaicRECs (e.g., 1million from theAdjustableBlockProgram, 1million from the Initial ForwardProcurement, and 1.2million from the PhotovoltaicForwardProcurement)bytheendof2020‐2021,thentheSecondSubsequentForwardProcurementvolume could be increased from 1million RECs to 1.4million RECs to stay at the 200,000 RECmatchingrequirement.

259Typereferstowhetherthegeneratingfacilityisneworexisting.260RECTargetissubjecttoavailableRPSbudgetlimitations.ThefinaltargetRECvolumeforthisprocurementwillbesetinearly2019.261Tobeprecise,theInitialForwardProcurementobtained965,000annualRECsfromutility‐scalewindpowerfacilities,andtheFirstSubsequentForwardProcurementwillseektoobtain1,035,000annualRECsfromutility‐scalewindfacilities,asdescribedinSections3.10and5.7.1.


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5.8.3. OtherRenewables15‐YearForwardProcurementProcurement Technology Type

262ProcurementDate

Term DeliveryStart

AnnualRECTarget

OtherRenewablesForward

Anyotherthanwind/photovoltaic

New Fall2019 15Years 2020‐2021orlater

Tobedetermined

TheAgencywillalsolookbeyondRECsfromnewwindandnewphotovoltaicprojectstomeettheannualRPSgoals.GiventheintroductionofnewlanguageintotheIPAActspecificallyexplainingthebenefitof“developingnewrenewableenergyresourcesinIllinois,”263theAgencyunderstandsthegeneralgoalandspiritofP.A.99‐0906tobetoprioritizeprocurementsforRECsthatresultinthedevelopmentofnewrenewableenergyfacilitiesoverprocuringRECsfromexistingfacilities.ThisprioritizationleadstheAgencynexttoproposeprocurementsfocusedondevelopingnewrenewableenergyfacilitiesthatarenotwindorphotovoltaic.

Section1‐10oftheIPAActdefinesRenewableEnergyResourcesasfollows:

“`Renewable energy resources’ includes energy and its associated renewable energycreditorrenewableenergycreditsfromwind,solarthermalenergy,photovoltaiccellsand panels, biodiesel, anaerobic digestion, crops and untreated and unadulteratedorganic waste biomass, tree waste, and hydropower that does not involve newconstructionor significantexpansionofhydropowerdams.Forpurposesof thisAct,landfill gas produced in the State is considered a renewable energy resource.`Renewable energy resources’ does not include the incineration or burning of tires,garbage,generalhousehold,institutional,andcommercialwaste,industriallunchroomorofficewaste,landscapewasteotherthantreewaste,railroadcrossties,utilitypoles,orconstructionordemolitiondebris,other thanuntreatedandunadulteratedwastewood.”

Section 1‐75(c)(1)(C) of the Act states that “at least 75% [of the RECs satisfying the Section 1‐75(c)(1)(B)percentage goals] shall come fromwindandphotovoltaicprojects,”whichopens thedoorforconsiderationbytheAgencyofprocurementsforRECsfromothergeneratingtechnologies.The Agency believes that there is value in increasing the diversity of sources of RECs for itsprocurementsbeyondonlywindandsolar.

Tothatend,theAgencyproposestoconductanOtherRenewablesForwardProcurementofRECsfromnewrenewableenergygeneratingfacilitiesthatarenotwindorphotovoltaic.264ThisForward

262Typereferstowhetherthegeneratingfacilityisneworexisting.26320ILCS3855/1‐5(6).Newrenewablegenerationalsohelpsachievethegoalsandobjectivesoutlinedin20ILCS3855/1‐5(H)(“diversifyIllinoiselectricitysupply,improvereliability,avoidandreducepollution,reducepeakdemand,andenhancepublichealthandwell‐beingofIllinoisresidents,includinglow‐incomeresidents”),alsonewlyintroducedthroughP.A.99‐0906.264TheAgencyunderstands thathydropower facilities featuringnew turbinesadded toexistingnon‐hydropowerdamswouldnotbeeligibletoparticipateasthesefacilitieswouldconstituteanewlyconstructed“hydropower”dam,andwouldthusbeprohibitedunderSection1‐10oftheIPAAct’slimitationofeligiblehydropoweronlyto“hydropowerthatdoesnotinvolvenewconstructionorsignificantexpansionofhydropowerdams.”


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Procurementwilltakepriorityoverthe2019SpotProcurementdiscussedinSection5.9265becausethis procurement helps ensure that the benefits of new renewable generation are captured.Furthermore, by conducting a Forward Procurement for RECs from new renewable energygenerating facilities thatarenotwindorphotovoltaic, theAgencywillhelpensure the long‐termsupplyofRECstomeetRPSgoalsafterthe2020‐2021deliveryyear.

Prior toproceedingwith thisprocurement, theAgencywill conductaRequest for Information togaugedeveloperinterestintheprocurement.IftheAgency,inconsultationwithICCStaff,determinesthat there is sufficient interest tomake a procurement viable and cost effective, the Agencywillconductthisprocurementinthefallof2019forRECstobegindeliveryinthe2020‐2021deliveryyearorlater.ThefinaltargetRECvolumeforthisprocurementwillbesetinearly2019basedontheperformanceofotherprocurementsandprograms,marketfeedback(includingthroughtheRequestforInformationprocess),andanalysisofexpectedavailablebudget.

5.8.4. CommunityRenewableGenerationProgramForwardProcurementProcurement Technology Type

266ProcurementDate

Term DeliveryStart

AnnualRECTarget

CommunityRenewableGenerationProgramForward

Anynon‐photovoltaic(withsubscribers)

New Fall2019 15Years 2020‐2021orlater

Tobedetermined

Section 1‐75(c)(1)(N) of the IPA Act contains specific provisions requiring the creation of aCommunityRenewableGenerationProgram:

The long‐termrenewableresourcesprocurementplanrequiredbythissubsection(c)shallincludeacommunityrenewablegenerationprogram.TheAgencyshallestablishtheterms,conditions,andprogramrequirementsforcommunityrenewablegenerationprojectswithagoaltoexpandrenewableenergygeneratingfacilityaccesstoabroadergroupofenergyconsumers,toensurerobustparticipationopportunitiesforresidentialand smallcommercialcustomersand thosewhocannot installrenewableenergyontheirownproperties.

In turn, “community renewable generation projects” are defined in Section 1‐10 of the Act asincluding wind, solar thermal, photovoltaic, biodiesel, crops and untreated and unadulteratedorganicwastebiomass, treewaste, andnon‐newhydropower.TheAgency expects that themostlikely type of project to participate in a program to support community renewable generationprojectswouldbephotovoltaicprojects,andthoseprojectsmustparticipateintheAdjustableBlockProgram.267However, theremaybe interest indevelopingother potential community renewable

265TheSpotProcurementproposed for2018wouldbe forRECs for thedeliveryyears2017‐2018and2018‐2019,andtherefore it isunlikelythatanyprocurementofRECsfromnewresourceswouldcreateanoverlapinRECsprocuredtomeettheRECtargetsforthoseyears.266Typereferstowhetherthegeneratingfacilityisneworexisting.267 Specifically, Section1‐75(c)(1)(N)provides that “[t]heAgency shall purchase renewable energy credits fromsubscribed sharesofphotovoltaic community renewable generationprojects through theAdjustableBlock programdescribed in subparagraph (K) of thisparagraph(1)orthroughtheIllinoisSolarforAllProgramdescribedinSection1‐56ofthisAct.”


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generation projects that use other sources of renewable energy such as wind, solar thermal, orbiomass.ThisSectiondescribesthecompetitiveprocurementprocessthatwouldbeusedtoprocureRECs from community renewable generation projects that are not photovoltaic (photovoltaiccommunity renewable generation projects will participate in the Adjustable Block ProgramdescribedinChapter6).

Detailsrelatedtoterms,conditions,andprogramrequirementsandotheraspects(e.g.,portabilityandtransferabilityofsubscriptions,andmonetarybillcredits)ofcommunityrenewablegenerationprogramsaredescribedindetailinChapter7.

The creation of the Community Renewable Generation Program does not provide any specificquantitativetargetsfortheprogramorexplicitlystatethattheprogramwouldprocureRECsfromthecommunityrenewablegenerationprojects,otherthantospecifythemechanismsforprocuringRECsfromphotovoltaiccommunityrenewablegenerationprojects:

The Agency shall purchase renewable energy credits from subscribed shares ofphotovoltaiccommunityrenewablegenerationprojectsthroughtheAdjustableBlockprogramdescribed insubparagraph(K)ofthisparagraph(1)orthroughtheIllinoisSolarforAllProgramdescribedinSection1‐56ofthisAct.

TheAgencynotesthat,outsideofitsuseoftheRenewableEnergyResourcesFundasdescribedinSection1‐56oftheIPAAct,itdoesnot(andcannot)directly“purchase”RECsfromsystems,inpartbecauseithasnofundingsourcefromwhichtodoso;instead,itfacilitatesthepurchaseofRECsbytheutilities.OtherprovisionsofSection1‐75(c)oftheAct,aswellasSection16‐108(k)ofthePublicUtilitiesAct,contemplatethatutilitieswoulddirectly“purchase”RECsthroughtheAdjustableBlockProgram;thus,theIPAwillinterpretthisprovisiontomeanfacilitationbytheAgencyofpurchasebyutilities.RECsfromphotovoltaiccommunityrenewablegenerationprojectsareconsideredpartofthe Adjustable Block Program REC targets. RECs from other types of community renewablegenerationprojectscouldbeappliedtootherportionsoftheRPStargets.

For community renewable generationprojects that arenotphotovoltaic, theAgencyproposes toconductaCommunityRenewableGenerationProgramForwardProcurement forRECs fromnon‐photovoltaicprojects.ThisRECprocurementwilloccur in2019.RECs fromwinningprojectswillbegindeliveryinthe2020‐2021deliveryyearorlaterandwillhaveadeliverytermof15years.Therequirements to participate in this procurementwillmirror the requirements for a photovoltaiccommunity renewable generation project to apply to the Adjustable Block Program. The keydifferencewillbethat,ratherthanapplyingforasetpriceforRECs,theapplicationwillbetheinitialsubmittalforacompetitiveprocurementthathasbidsselectedbasedprimarilyonprice,asisdonefortheothercompetitiveprocurementsconductedbytheIPA.ThefinaltargetRECvolumeforthisprocurement will be set in early 2019 based on the performance of other procurements andprogramsandanalysisofexpectedavailablebudget.

TheCommunityRenewableGenerationProgramForwardProcurementforwillalsoincludethesefeatures:

RECpricewillbebasedonbidprice.Therewillnotbeadditionaladdersbeyondthatprice. RECswillbepaidforondelivery(asopposedtothefront‐loadedpaymentstructureofthe

AdjustableBlockProgramcommunitysolarprojects).


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Projectsmustmaintainsubscriberparticipationlevels,andthequantityofRECthatwillbepaidforeachyearwillbetiedtothesubscriptionlevelmaintained(measuredincapacity,notnumberofsubscribers).WinningbidderswillberequiredtoreportannuallytotheAgencyandtotheutilitypurchasingtheRECsonsubscriptionlevels.

5.9. 2018and2019SpotProcurementsProcurement Technology268 Type

269ProcurementDate

Term Delivery AnnualRECs270

2018SpringSpot

Any Any Spring2018 OneYear 2017‐2018 7.5million271

2018SummerSpot

Any Any Summer2018 OneYear 2018‐2019 12.9 million(est.)272

2019SummerSpot

Any Any Summer2019 OneYear 2019‐2020 16.3 million(est.)273

TheRPSgoalsidentifiedinChapter3fortheinitialyearsofthisPlanarenotlikelytobemetbyalltheprocurementsproposedintheprevioussectionsofthisChapterplustheprogramsdescribedinChapters6,7,and8.ThisisespeciallytruefortheinitialyearscoveredbythisPlanduringwhichnewprojectsareunderdevelopmentandconstructionandnotyetdeliveringRECs.TheprocurementsdescribedintheprevioussectionsareintendedtomaximizetheopportunitiestoprocureRECsfromnewprojects,resultinginthedevelopmentofnewrenewableenergygenerationthatwillprovideRECs.ThissectiondescribestheSpotProcurementsthatareintendedtomeettheRPSgoalsfortheinitial years of the Plan as well as to fill in any remaining gaps after the various ForwardProcurementsareconducted.

ThisPlanwillnotbeapprovedbytheCommissionuntilwellintothe2017‐2018deliveryyear,yettheActrequiresthat,

ForthedeliveryyearbeginningJune1,2017,theprocurementplanshallincludecost‐effective renewableenergy resourcesequal toat least13%ofeachutility's load foreligible retailcustomersand13%of theapplicableportionofeachutility's load forretailcustomerswhoarenoteligibleretailcustomers,whichapplicableportionshallequal50%oftheutility'sloadforretailcustomerswhoarenoteligibleretailcustomersonFebruary28,2017.274

TheAgencybelieves that it isobligated toseek toprocureRECs fromneworexistinggeneratingfacilities tomeet the13%goal for the2017‐2018deliveryyearusingavailableRPS funds for the268Subjecttotherequirementthat75%ofoverallRECsforthedeliveryyeararefromwindorphotovoltaic.269Typereferstowhetherthegeneratingfacilityisneworexisting.270AllquantitiesaresubjecttoavailableRPSbudgetlimitations,andareexpectedtoclosethegapandmeettheRPSdeliveryyearRPSGoal.271Finalquantitybasedon2016‐2017actualdeliveredenergy,andcontractedvolumesexpectedfordeliveryinthisdeliveryyear.272Finalquantitytobebasedon2017‐2018actualdeliveredenergy,andcontractedvolumesexpectedfordeliveryinthisdeliveryyear.273EstimatedquantityneededtomeettheDeliveryYearRPSGoal.Finalquantitywillbebasedon2018‐2019actualdeliveredenergy,contractedvolumesfordeliveryinthisdeliveryyear,andexpectedRECdeliveriesassociatedwiththeAdjustableBlockProgram.27420ILCS3855/1‐75(c)(1)


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deliveryyear.Furthermore,asimilarprovision(14.5%)existsforthe2018‐2019deliveryyear(withtheportionofloadtowhichRPSrequirementsapplyfornon‐eligibleretailcustomersincreasingto75%),andthenincreasingby1.5percentagepointseachyearthereafterforallretailload(otherthantheAREScarve‐outdiscussedinSection3.3).

AkeyconsiderationforSpotProcurementsisthatthepoolofeligibleRECswillbesmallerthanformany of the previous REC procurements conducted by the IPA. This is due to the narrowing ofgeographiceligibilityoffacilitiesproducingRECstoonlyIllinoisandselectfacilitiesinadjacentstates(thosethatcanmeetthepublicinterestcriteriaprovisionsofSection1‐75(c)(1)(I)),aswellastheprohibitionofRECs fromgeneratingunitswithcosts recovered throughregulated rates found inSection1‐75(c)(1)(J).275

AreviewofthepublicreportsinGATSandM‐RETSsuggestthattheremaybesignificantquantitiesofRECs inIllinoisandadjacentstatesthatcouldbeeligible fortheSpotProcurements.Whiletheways in which RECs from previous years were used does not necessarily indicate future RECavailability,5millionIllinoiswindRECsfromthe2016‐2017deliveryyearwerenotretired,and5millionwindRECsfromIowaandWisconsinwerenotretired,whileanother1millionhydroelectricRECsfromWisconsinwerelikewisenotretired.276ARECnotbeingretiredmaybebecausetheownerwasunabletosellit,butmayalsobebecausetheownerchosenottosellitbecauseitwishedtoretaintherights to theenvironmentalattributesassociatedwith theREC.The IPAhasnotbeenable toascertainwhytheselargequantitiesofRECsremainunretired,buttheydoindicatethattheremaybeopportunitiesfortheIPAtoprocuresuchRECsforthe2017‐2018andsubsequentdeliveryyears.Conducting theprocurementsmayalsoprovide informationon theextent towhich thoseunsoldRECsareavailableforuseinmeetingtheIllinoisRPSannualgoals.

Asaresult,theAgencyproposesthefollowingSpotProcurements:

Spring2018SpotProcurementforRECsgeneratedinthe2017‐2018deliveryyear Summer2018SpotProcurementforRECsgeneratedinthe2018‐2019deliveryyear Summer2019SpotProcurementforRECsgeneratedinthe2019‐2020deliveryyear

EachprocurementwillbedesignedtoprocuretheremainingRECsrequiredtomeetthatdeliveryyear’sRECgoalsusingtheavailable(e.g.,unallocatedtoothercontracts)RPSbudgetforthatdeliveryyear,andwillonlybeforRECsfromtheapplicabledeliveryyear(inotherwords,thevintage277oftheRECsmustmatchthedeliveryyearforwhichtheSpotProcurementismeanttomeettheRPSgoals).These procurementswill contain the following provisions, but otherwisewill be conducted in amannersimilar to theprevious IPARECprocurementsandwillbeconductedconsistentwith therequirementsofSection16‐111.5ofthePUA,totheextentpracticable.

Foreachprocurement, therewillbe twogroupsofRECstobeprocured,with targetsadjustedtoensurethattheresultofeachoftheseprocurementswouldbethatatleast75%ofRECsusedtomeettheIllinoisRPStargetscomefromwindandphotovoltaics.Thegroupsare:

275ThesenewrestrictionsarediscussedinChapter4ofthisPlan.276TheseillustrativeexamplesdonotfactorinthepublicinterestcriteriathatmaylimitavailabilityofRECsfromadjacentstatesortherequirementthatRECscomefromgeneratingunitsthatdonothavetheircostsrecoveredthroughregulatedrates.277VintagereferstothemonthandyearofthegenerationusedtocreateaREC.


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1. Wind/photovoltaicRECs2. Non‐windandnon‐photovoltaicsRECs

ForSpotProcurements,RECswouldnotneedtobefromaspecificgeneratingfacilityidentifiedatthetime of bidding; thus, the obligation to deliver RECs cannot be excused by a unit‐related issue(althoughtheunitmustbeeligibletodeliverRECsforcompliancewiththeIllinoisRPS).RECsthatareotherwisecontractuallycommittedthroughanyotherprocurementorprogramadministeredbytheIPAwillnotbeacceptable.Inotherwords,eligiblefacilitiesthathavesurplusRECs(nototherwisecontractuallycommittedRECs)maybidsurplusRECsinSpotProcurements.

The Procurement Administrator will allocate bids to each utility, including splitting bids wherenecessarywiththegoalofmatching,totheextentpossible,eachutility’saverageRECpriceandeachutility’sRECCostAllocationdiscussedinSection3.1.

5.10. ConsiderationofPotentialProcurementsafter2019andThrough2030

ThisChapterhasfocusedoncompetitiveprocurementstobeconductedin2018and2019designedtomeet annualRPSpercentagegoals through theendof the2019‐2020delivery year aswell asmeetingthespecifictechnology‐basedRPStargetsthroughtheendofthe2020‐2021deliveryyear,includingthe2millionRECseachfromnewwindandphotovoltaicprojectsandthe2%requirementfrom brownfield site photovoltaics. At this time, the IPA is proposing to review updated loadforecasts,budgets,andactualprogramandprocurementresultsaspartofitsreviewandrevisionofthePlantobeconductedin2019forimplementationin2020,andwillproposespecificprocurementstomeetfutureyears’targetsaspartofthatPlanrevision.

Nonetheless,inconsideringtheprocurementsthatmightbeproposedinthe2019Planupdate,duetothelimitationsonnewwindbeingprocuredwhichwouldcauseRECsfromnewwindprojectstoexceedRECsfromnewphotovoltaicprojectsbymorethan200,000,thefirstprioritywillbetoensurethatthereareenoughRECsfromnewphotovoltaicprojectsprocuredtoallowforthenextforwardprocurementofRECs fromnewwindprojects.Thiswill likely requirebothensuring theongoingsuccessoftheAdjustableBlockProgramaswellasadditionalcompetitiveprocurementsforRECsfromnewutility‐scaleandbrownfieldsitephotovoltaicprojects.

Lookingbeyond2019,assumingthereviewofinitialresultsandbudgetlimitationsconductedaspartofthe2019PlanupdatedonotleadtheAgencytoreconsiderradicallyitsapproachtoprocurementandprograms,theAgencyplansforitsprocurementschedulefrom2020to2030togenerallyfollowthescheduleoutlinedinthisPlanfortheinitialyears.Subjecttobudgetavailability,thisapproachwouldconsistofannualprocurementsofRECsfromutility‐scalenewwindprojectsandfromnewutility‐scaleandbrownfieldsitephotovoltaicprojects,andothernewprojectsofotherrenewablegenerating technologies through 15‐year forward procurements (with the Agency continuing toassessandmonitorthemarketinterestin15‐yearforwardprocurementsforgeneratingtechnologiesotherthanwindandsolar).Subjecttobudgetavailability,theAgencywouldcontinuetoconductspotprocurementsasnecessarytomeettheannualtargetsinSection1‐75(c)(1)(B)oftheActthatarenotbeingmetthroughthevariousForwardProcurementRECcontractsandRECsfromtheAdjustableBlockProgram.TotheextentthatcommittingfuturebudgetstoForwardProcurementcontractsisfeasible,theAgencywouldseektoemphasizeobtainingRECsthroughthoseprocurementsandovertime reduce the reliance on Spot Procurements to meet the statutorily mandated annual RECpercentagegoals.


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6. AdjustableBlockProgram

6.1. BackgroundSections1‐75(c)(1)(K)and(L)oftheIPAAct,asamendedbyPublicAct99‐0906,requiretheAgencyto establish an Adjustable Block Program for the procurement of RECs from new photovoltaicdistributed generation systems and from new photovoltaic community renewable generationprojects(colloquiallyknownas“communitysolar”).TheAdjustableBlockProgramstandsincontrastto the competitive procurements described in Chapter 5 in that it features administrativelydeterminedpricesforRECsandisopenonanongoingbasis,ratherthanhavingdiscreteprocurementevents.

PriortotheadoptionoftheAdjustableBlockProgrammodel,thedevelopmentofnewphotovoltaicdistributed generation in Illinois had been supported in other ways. From 1999 to 2015, theDepartment of Commerce and Economic Opportunity (“DCEO”) offered rebates for photovoltaicprojects;theserebatescoveredupto25%‐30%oftheprojectcostandsupportedover1,100solarPVprojectswithatotalcapacityof13MW.278TheDCEOrebateswereavailableonceperyearandtheavailablebudgetwasquicklyallocated,leadingtouncertaintyforinstallersaboutwhethertheirprojectswouldorwouldnotreceivearebateinanygivenyear.Nofundshavebeenappropriatedfortherebateprogramforthepasttwoyears,anditisnotknownwhetherfundswillbeappropriatedagainbeforetheenactinglegislationexpiresin2020.

Additionally,theIPAconductedSupplementalPhotovoltaicProcurementsin2015and2016underauthority granted by Section 1‐56(i) of the IPA Act, and the Agency proposed and conductedDistributed Generation procurements for the utilities from 2015 through 2017 (although theseprocurementsfortheutilitieswerenotlimitedtophotovoltaicsystemsortonewsystems)tomeetastatutory DG procurement target in the pre‐P.A. 99‐0906 RPS. The previous procurementsadministeredbytheIPAfeaturedcompetitivebiddingforprojects,andeachwinningbidderreceivedacontractthroughwhichRECsactuallydeliveredwerepaidforatthebidder’sbidprice.Whilethisapproachcreatedthemarketefficiencythatisinherentincompetitivebiddingprocesses,installersofprojectsfounditdifficulttosellprojectswhenthepotentialRECrevenuewouldnotbeknownuntilabidwasaccepted(oralternativelytherewouldbenoRECrevenueifabidwasnotaccepted).Tomitigatethatchallenge,theAgencyallowedbidderstobidonforecastedblocksofRECsforsystemsbelow25kWandgivedeveloperstimetoidentifyprojectsusingaknownRECprice.

TheAdjustableBlockProgramisintendedtoaddresstheseissuesbyfeaturinganapproachthatiscontinuously open, rather than relying on specific procurement events (or rebate applicationwindows),featuresaclearsetofprices,andcantapintoamuchlargerbudget.Theprogramalsoexpandsthemodeltoaccommodatecommunitysolarsothathomesandbusinessesthatcannotplacesolarontheirpropertycannonethelessparticipatein,andbenefitfrom,directaccesstorenewableenergy.

TheAdjustableBlockProgramapproachhasbeenpreviously implemented insimilarmanners inother states and countries. The Adjustable Block Program will offer a set price for RECs fromqualifyingprojects,andthepricewillbeadjustedinvolumetricblocks(hencethe“adjustableblock”

278 See Renewable Energy, Energy Efficiency, and Coal Resources Development Law of 1997, 20 ILCS 687/6‐1 et seq.; also seehttps://www.illinois.gov/dceo/AboutDCEO/ReportsRequiredByStatute/2013%20RERP%20Annual%20Report.pdf,https://energy.gov/savings/renewable‐energy‐resources‐trust‐fund.


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name)basedonmarketresponse.TheAgency’sgoalistodesignasystemofadjustableblockswithpricesthatwillelicitthemaximumamountofdeploymentattheleastpossiblecost,withahighlevelofcertaintyandtransparencyforconsumersandmarketparticipants.

6.2. LessonsFromOtherJurisdictionsIllinoisisfarfrombeingthefirsttoadoptanapproachofadministratively‐determinedincentivesorablockprogramtomanagegrowthofthephotovoltaicindustry.Experiencefromothermarketscaninformbestpracticesforsettingpricesandprogramdesign. Solarphotovoltaicpowerhasbeenarapidlydevelopingtechnologyinrecentyears,withrapidpricedeclinesandindustrygrowth.Thisdynamic environment hasmade it challenging for policymakers to design incentives that ensurehealthygrowth,withoutcostingtaxpayersandratepayerstoomuchorcausingunsustainable“boomandbust”cyclesthatharmtheindustryandconsumers.

ToinformtheprogramdesignoftheAdjustableBlockProgram,theAgency’sreviewandanalysisofother programs included relevant experiences from Germany, Spain, California, and particularlyMassachusettsandNewYork.AppendixCprovidesasummaryofthoseexperiences.

WhiletheNewYorkandMassachusettsprogramsarebothbasedonadecliningblockstructure,andpayincentivesonafirst‐come,first‐servedbasis,keydesignaspectsvary.TheNYSUNprogramhas3regions(LongIsland,ConEdison,andUpstate)eachwithadistinctnumberofblocks,blocksizesandblockprices. IncentivesarepaidindollarsperWatt(capacity),decliningdifferentlyforeachregion and sector, except for the residential sectorwhereprices decrease by $0.10/Wacross allregions.LiketheproposedIllinoisAdjustableBlockProgram,NYSUNpayssmallsystemsatthetimeofenergization,whereascommercialprojectsreceiveapartialpaymentupfrontwiththeremainderpaidininstallmentsoversubsequentyears.

The proposed Massachusetts SMART program (which builds upon the past success of earlierprogramsinthatstate)willhavethesameblocksizesforallthedistributioncompanies,withthesamecompensationrateacrossthestate.Theincentivewillbeexpressedin$/kWh(energy)andwilldecreasebyauniform4%asitmovesfromoneblocktothenext.

IntheMassachusettsprogramforprojectswithcapacitiesof25kWorless,theexecutedcontractshall include a budget that identifies key project components and a timeline and correspondingpaymentscheduleforinstallationoftheproject.

6.2.1. ManagingInitialDemandSomeincentiveprogramshaveencounteredproblemsdealingwithalargequantityofapplicationscominginveryquicklyupontheapplicationwindowopening.California’sSelfGenerationIncentiveProgram (“SGIP”) is aprimeexample. In2016, $40millionof SGIP fundingwasmade available.Applicantsfiled658reservationrequeststotaling$181millioninrequestedincentivesinthefirst10minutes followingprogramopening.279Someapplicantswere foundtobedeployingquestionablestrategiestogettheirapplicationearlierinline,includingfilingapplicationsfromwithinthesameservernetworkastheapplicationrecipient.Onevendorvolunteeredtogiveuphalfofitsrewarded

279 EricWesoff, GreentechMedia, “Update: Stem’sResponse to the California SGIP SubsidyAwardProcess Imbroglio,”May 16, 2016.https://www.greentechmedia.com/articles/read/Update‐Stems‐Response‐to‐the‐California‐SGIP‐Subsidy‐Award‐Process‐Imbrog.


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incentivestoavoidlitigation.Asaresult,theCaliforniaPUCreformedtheprogramtoaddanumberofprotectionsagainstawardsbeingmonopolizedbyearlyapplicants:280

Replacing the first‐come, first‐served system with a lottery in which projects havingadditionalgreenhousegas/gridbenefitsareassignedpriority;

Makingallof the incentivemoneyavailableonacontinuousbasis inadeclining incentive“step”structure,akintotheCaliforniaSolarInitiative;and

Restrictingeachprojectdevelopertoacapof20percentoftheincentivebudget,ratherthantheprevious40percentcapthatappliedtoequipmentmanufacturers

In the development of the structure of theAdjustableBlockProgram, theAgencyhas taken intoaccount its review of the experiences of other jurisdictions, what it has learned from previousprocurements ithasadministered,andthefeedbackithasreceivedfromstakeholders.For issuesthatarenotexpresslyaddressedintheAct,theAgencyhasmadepolicydecisionstoimplementtheprogramthatitbelieveswillresultinacosteffectiveandsuccessfulprogram.

6.3. BlockStructureThe core of the Adjustable Block Program is the concept of a “block.” The program delineatesincentivesforvariouscategoriesofeligibleprojectsusingblocksofgenerationcapacityatcertainpricesperREClevels.Theblocksareintendedtocreateaprogressionfromonepriceleveltoanotherbased on the response of themarket. A strong response from themarketwill result in a rapidprogression toa lowerprice level, forexample,whileaweakresponsecouldelicitan increase inincentivesifitisdeterminedtobenecessary.Figures6‐1and6‐2inSection6.4provideanillustrationofhowtheblocksadjustbyprice.

Progressionfromoneleveltoanotheristriggeredbyacertainvolumeofdeployment,notbyatime‐baseddeadline.Thisdeployment‐baseddesignisintendedtoactasasafetyvalveincaseincentivesare set at too high a level, which has been a problem in previous attempts at administratively‐determinedprices.Itcanalsoprovidelongtermcertaintybygivinganindicationoffuturepricesandquantitiestoallpotentialmarketparticipants.

TheinitialgoalfortheAdjustableBlockprogramistohave1,000,000RECsdeliveredannuallybytheendofthe2020‐2021deliveryyear(i.e.,May31,2021).SeeChapter3formorediscussionofgoals.Usingacapacityfactorof17%(seeSection6.14.5),thiswouldresultinapproximately666MWofnewphotovoltaicgeneration.Thisgoalisnotacap;ifdemandfornewprojectsisstrongenough,andfundingavailable,thereisnobarrier(otherthanthemonetaryRPSbudgetdiscussedinSection3.17)togoingbeyondthatlevel.

Inordertoachievethatgoal,theAgencyhasdevelopedablockstructurethatitexpectswillallocatethreeblockspercategorytomeettheexpecteddemandforthisprogram(e.g.,1millionRECsperyearbytheendofthe2020‐2021deliveryyear),whichwouldroughlybeoneblockpercategoryperyear through 2020. However, the block structure is open ended, so while the initial blocks aredesignedtoroughlymatchthegoalsthroughthe2020‐2021deliveryyear,ifdemandinanygivencategory is stronger thananticipated (and fundingavailable), additionalblocksafterBlock3willopentoaccommodatethatdemand.(Likewise,ifdemandislowerinacategory,ablockmayremain

280 Eric Wesoff, Greentech Media, “California PUC Proposes Long‐Overdue Reform on SGIP Subsidy,” May 23, 2016.https://www.greentechmedia.com/articles/read/california‐puc‐proposes‐long‐overdue‐reform‐on‐sgip‐subsidy.


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openlonger.)Inaddition,theblocksize,structure,andpriceswillbereviewedandupdatedasneededaspartofthePlanupdatein2019(totakeeffectincalendaryear2020).

To encourage simplicity, the Agency proposes to allocate incentives into two groups by serviceterritory/geographiccategory,baseduponloadforecastscontainedinChapter3.281

GroupA:forprojectslocatedintheserviceterritoriesofAmerenIllinois,MidAmerican,Mt.CarmelPublicUtility,andruralelectriccooperativesandmunicipalutilitieslocatedinMISO.

Group B: for projects located in the service territories of ComEd, and rural electriccooperativesandmunicipalutilitieslocatedinPJM.

Incentivelevelswillvarybygroupandwillbebasedupontheproject’slocation.WhiletheprogramadministratorwillstrivetoallocateRECdeliverycontractswiththeelectricutilityinwhoseserviceterritorytheprojectislocated(whereapplicable,astheIPAlacksauthoritytoprocureRECcontractson behalf of municipal utilities or rural electric cooperatives), in order to allocate RECsproportionatelyamongAmerenIllinois,ComEd,andMidAmericantomeettheirRPSobligations,thatwillnotalwaysbepossible.

TheAgencyalsoconsideredcreatinganadditionalgrouporgroups forMidAmerican,Mt.CarmelPublicUtility,ruralelectriccooperatives,andmunicipalutilities.However,giventheirsmallshareoftheloadinIllinois,theresultinggrouporgroupswouldbequitesmall.Byconsolidatingthemintothe larger groups, block sizes are more administratively manageable, and prices are moretransparentandeasilyunderstood.TheassignmenttoGroupsofprojectsintheserviceterritoriesofMt.CarmelPublicUtility,MidAmerican,ruralelectriccooperativesandmunicipalutilitiesisintendedtoapproximatelymatchthosesmallerentitiestoalargerutilitywithcomparableelectricrates.

Withineachgroup,theblockswillbedividedbytheallocationsspecifiedinSection1‐75(c)(1)(K)oftheAct,whichare25%forsystemsupto10kW,25%forsystemsgreaterthan10kWandupto2,000kW,25%forphotovoltaiccommunityrenewablegeneration,and25%tobeallocatedbytheAgency.At this point in time, it is premature for the Agency to predictwhich sectorwill experience thestrongestdemand.Therefore,the25%thatislefttotheAgency’sdiscretionwillbeevenlyallocatedacross the three categories. In the Plan Update, the Agencywill review and reallocate that 25%amountifneeded.

Theallocationswillbe:

33.3%forDGPVsystemsupto10kW(Smallsystems) 33.3%forDGPVsystemsgreaterthan10kWandupto2,000kW(Largesystems) 33.3%forphotovoltaiccommunityrenewablegenerationprojects(CommunitySolar)

ForsystemsintheLargeDGPVandCommunitySolarcategories,theuseofadjustments(asdiscussedbelowinSection6.5)willbeusedtodifferentiatethepriceforRECsfromdifferentsizedsystems.Inthe alternative, the Agency considered subdividing those categories into smaller blocks, but theAgency isnotconvincedthatsuchanapproachwouldbemoreefficientorabetterwaytomatchpricestodemandfromthemarket.

281TheallocationforComEdMidAmericanwouldbe70.34%andthecombinedallocationforAmerenIllinoisandMidAmerican29.66%.Forsimplicity,thesehavebeenroundedto70%and30%fordeterminingthesizeofblocksforGroupAandGroupB.


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ProjectsthatparticipateintheIllinoisSolarforAllProgram(asdescribedinChapter8)willgenerallyfollowtheprogramtermsandconditionsoftheAdjustableBlockProgram,butwillapplyseparately,andwillnotbeconsideredpartoftheseGroupsandcategoriesforthepurposeoffillingthecapacityofeachBlock. Thoseprojectswillalsobesubjecttoadditionaltermsandconditions,aswellasadifferentcontractualprocess.

6.3.1. TransitionbetweenBlocksWhenablock’scapacityisfilled,thenextblockforthatcategory(withadifferentprice)willopenatapriceexpectedtobe4%lowerthanthepreviousblock.Inordertosmooththetransitionbetweenblocks,andtoavoidunnecessaryrushesintheapplicationprocess,theclosingofeachblockwillbeasoftclosing,asexplainedbelow.TheAgencyanticipatesthattherewillbestrongpent‐updemandforparticipationintheAdjustableBlockProgram.Therefore,thetreatmentofblockclosingwillbedifferentforeachBlock1thanforsubsequentblocks.

For each Block 1, projects submitted within 45 days of the program opening will beconsideredforthatBlock.IfthetotalquantityofreviewedandapprovedprojectssubmittedinBlock1duringthatfirst45daysexceeds200%oftheBlock1volume,thentheAgencywillassessthetotaldollarvalueofprojectssubmittedandtheavailable(uncommitted)currentand future yearRPSbudgets282 of the applicableutility.283TheAgencywould then select,through a lottery, projects that would be included in the approval of initial batches forinclusion in Block 1. Projects not selectedwould be held for approval until such time asfunding is available and would be included in the next block at the applicable price.284Projectssubmittedafterthefirst45dayswouldbeincludedinthesubsequentblock,buttheywouldnotbe included insubsequentapprovedbatchesuntil all initialprojectsareeitherapproved or withdrawn by the Approved Vendor. Each block will be evaluatedindependently,andtheAgencywillannounceanestimateofavailablefundingpriortotheopeningoftheBlock1s.

Forsubsequentblocks(andforeachBlock1ifitisnotfilledinthefirst45days),theblockwillbeheldopenfor14daysaftertheblockvolumeisusedup.TheAgencywillannouncewhenablockhasbeenfilledandwhentheclosingdatewillbe.

Table6‐1showstheamountofnameplatecapacitythatwillbeinitiallyallocatedtoeachblockforeachgroupandcategory.285Thefinalamountforeachblockmaychangetoaccommodatethesoftclosingdescribedabove.Inotherwords,iftheinitialdemandfortheGroupA,Smallcategoryinthefirst45daysis30MW,thefinalamountofcapacityinthatblockwouldbe30MW,andthenextblockwouldopenwith22MWofexpectedcapacityavailable.However,ifGroupA,Largecategoryonlyhad10MWofdemandinthefirst45days,itwouldremainopenuntilits22MWofcapacitywerefilled(subjecttoanyadjustmentsinthefinal14days),andthenthenext22MWblockfortheGroupA,largecategorywouldopen.

282IncludinghourlyandARESACPfundsheldinreserve(seeSection3.19).283Thisassessmentwillaccountforthedifferencesinpaymentschedulesforprojectsupto10kW(fullpaymentonenergization)andover10kW(20%paymentonenergizationwiththebalancepaidoutoverthefollowingfouryears;seeSection6.6forfurtherdiscussion).284Theorderofreleaseofprojectsforapprovalwillbedeterminedintheinitiallottery.285EachMWofnameplatecapacityrepresentsapproximately1,490RECsforthefirstyearofproduction.


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Table6‐1:IllustrativeBlockOpeningVolumes(MW)

BlockGroup BlockCategory Block1 Block2 Block3GroupA

(AmerenIllinois,MidAmerican,Mt.Carmel,RuralElectricCooperativesandMunicipal

UtilitieslocatedinMISO)

Small 22 22 22Large 22 22 22

CommunitySolar 22 22 22GroupB

(ComEd,andRuralElectricCooperativesandMunicipalUtilitieslocatedinPJM)

Small 52 52 52Large 52 52 52

CommunitySolar 52 52 52Total 222 222 222

Subjecttotheconditionsoutlinedabove,aprojectwillreceivethepriceoftheblockthatisopenatthetimetheprojectapplicationissubmitted. Ifablockcloseswhileaprojectapplicationisbeingreviewedandtheprojectisnotaccepted,thecapacityassociatedwiththatrejectedprojectwillbeassignedtothenextblock.

AsdiscussedfurtherinSection6.15.3below,shouldasysteminagivenblockfailtobedeveloped,thatsystem’sportionoftheblockwillbeforfeited.Thevolumeassociatedwiththeforfeitedsystemwillbeaddedtotheblockthatiscurrentlyopenatthepriceforthatblock.

ThepublicwillbenotifiedoftheavailabilityofcapacityineachBlockviaanonlinedashboard,asdiscussedinmoredetailinSection6.10.

6.4. RECPricingModel

HistoricallytheIPAhasprocuredstandardwholesaleproducts(e.g.,energyandcapacity)aswellasrenewableenergyresources(e.g.,RECs)throughacompetitiveprocurementprocessthatfeaturedpay‐as‐bidRequestsforProposals.Underthatmodel,thepricepaidforaproductisthepricethatthesuccessfulbidderbids.Bidsforaspecificproductorcategoryofproductsarerankedonpriceandthen selecteduntil the target volume for theprocurement ismet. The competitivenatureof thisprocesscreatesmarketefficienciesasbiddersareforcedtosharpentheirbidstosucceed.Forthisprocess tobe successful, it is critical that information about prices andbids is kept confidential;biddersshouldbidbasedupontheirowninformationandnotinformationaboutotherbidders’bids.Incontrast,theAdjustableBlockProgrammodelisbasedupontheprincipleofhavinga“transparentscheduleofprices.”286Eachblockasdescribedabove inSection6.3willhaveanadministrativelydetermined,pre‐announcedprice,andadderswillbeused(wherespecified)tofurtheradjustthepricefortheRECsfromeachsystem.

GiventhischangeinapproachforthepricingofRECstobeusedfortheAdjustableBlockProgram,theIPAhasdevelopedaRECPricingModelfeaturingamethodologyforpricingRECsthatemphasizestransparency.Themethodologyusespubliclyavailabledata,andthemodelusedisbaseduponanindustrystandardphotovoltaicpricingapproach.TheintentoftheRECPricingModelistomodelaRECpricefortypicalsystemsinordertocreateasetofstandardRECpricesforuseinthisprogram.

28620ILCS3855/1‐75(c)(1)(K).


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TheRECPricingModelisbasedontheCRESTmodeldevelopedbytheNationalRenewableEnergyLaboratory(“NREL”).287TheRECPricingModeldeterminesRECpricesbybalancingthecalculatedCostofEnergyfromtheCRESTmodelwiththerevenuethatasystemwouldbeexpectedtoreceivethroughnetmetering.IndevelopingtheRECPricingModel,thedefaultinputsintheCRESTmodelwereupdatedtousepubliclyavailabledatafromthemostrecentNRELsolarphotovoltaicsystemcost study,288 certain information received by the Agency in the responses to the Request forCommentstheAgencyissuedinJune2017,andinformationcontainedincommentsonthedraftPlan.Severaldifferentsystemsizesweremodeled,andcommunitysolarwasmodeledbyadjustingforthedifferenceinnetmeteringbetweencommunitysolaranddistributedgeneration(e.g.,energy‐onlynetmeteringforcommunitysolar).AmoredetailedexplanationofthemodelandinputassumptionsiscontainedinAppendixD.Inaddition,themodelitselfisavailableasAppendixE.289

TheIPAadaptedandmodifiedtheCRESTmodelforthepurposesofcalculatingRECpricesforthisPlan.CRESTisaneconomiccashflowmodelthatestimatesthecostofenergyintermsofcentsperkilowatt‐hour associated with specific input assumptions regarding technology type, location,system capital and operating costs, expected production, project useful life, and various projectfinancingvariables.Modificationswerenotmadetothemodelingtoolitself,butrathertotheinputassumptionsandpostprocessingof the results.For thisPlan, filed forCommissionapproval andsubjecttochangethroughthedocketedproceedingapprovingthePlan,theAgencyemphasizesthatthesepricesshouldbeviewedaspreliminaryinnatureandnotnecessarilythepricesthatwillbe offered once programs launch, and parties should not take actions in reliance on theavailabilityofthesepreliminaryproposedincentivelevels.Thesepriceswilllikelychangedueto a combination of any proposals made during the docketed proceeding and approved by theCommissioninitsOrderapprovingthePlan,andtheupdatingofinputdatasubsequenttothePlanapprovalasdescribedbelow.TheAgencyalsonotesthatthesepricesarenotcomparabletotheRECpricesfrompreviousIPAprocurementsbecausethesearebasedonassumptionsarounda15‐yeardelivery of RECs, rather than bids received for a 5‐year delivery or 1‐year delivery of RECs.Furthermore,thepricespresentedinthisPlandonotreflectanypotentialtariffsthatmaybeimposedontheimportationofphotovoltaicmodulesandcells(asdiscussedbelowinSection6.8.4).

TheAgencyrecommends thatafter theCommissionapproves thisPlan in2018, theAgencyshallupdatespecificinputswherethedatamayhavechangedandpublishfinalpriceswithin60daysaftertheapprovalofthePlan.

Table6‐2containstheprelimarycalculationofRECprices,factoringinthesizecategoryadjustmentsdescribedinSection6.5.1.

287See:https://financere.nrel.gov/finance/content/crest‐cost‐energy‐models. 288 Ran Fu, Donald Chung, Travis Lowder, David Feldman, Kristen Ardani, and RobertMargolis. “U.S. Solar Photovoltaic SystemCostBenchmark:Q12016.”https://www.nrel.gov/docs/fy16osti/66532.pdf.289ExcelversionsofAppendixEareavailableontheAgency’swebsite,www.illinois.gov/sites/ipa/Pages/Renewable_Resources.aspx.


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Table6‐2:BlockGroupRECPrices($/REC)290

BlockGroup BlockCategory Block1 Block2 Block3

GroupA(AmerenIllinois,

MidAmerican,Mt.Carmel,RuralElectric

Cooperatives,andMunicipalUtilitieslocated

inMISO)

Small <=10kW $82.48 $79.18 $76.02

Large

>10‐25kW $74.75 $71.76 $68.89>25‐100kW $58.51 $56.17 $53.92>100‐200kW $45.75 $43.92 $42.16>200‐500kW $39.87 $38.27 $36.74

>500‐2,000kW $37.57 $36.07 $34.63

CommunitySolar

<=10kW $111.44 $106.98 $102.70>10‐25kW $99.88 $95.88 $92.05>25‐100kW $79.17 $76.00 $72.96>100‐200kW $65.76 $63.13 $60.61>200‐500kW $59.55 $57.17 $54.88

>500‐2,000kW $56.93 $54.66 $52.47

GroupB(ComEd,andRuralElectric

CooperativesandMunicipalUtilitieslocated

inPJM)

Small <=10kW $74.03 $71.07 $68.23

Large

>10‐25kW $67.58 $64.88 $62.28>25‐100kW $52.62 $50.52 $48.50>100‐200kW $39.87 $38.27 $36.74>200‐500kW $33.98 $32.62 $31.32

>500‐2,000kW $31.69 $30.42 $29.21

CommunitySolar

<=10kW $105.79 $101.56 $97.50>10‐25kW $94.24 $90.47 $86.85>25‐100kW $73.52 $70.58 $67.76>100‐200kW $60.12 $57.71 $55.40>200‐500kW $53.91 $51.75 $49.68

>500‐2,000kW $51.29 $49.24 $47.27AfterBlock1,pricesareexpectedtodeclineby4%witheachtransitionbetweenBlocks.TheAgencywillmonitorperformanceduringtheinitialBlocksandmayelecttomodifythepricechangebetweenblocksbaseduponthespeedthateachBlockisfilled.TheprocessformakingchangesisdescribedinSection6.8.

Figure6‐1and6‐2illustrateblockpricesforGroupAandGroupB,incorporatingthevarioussizecategoryadjustments.

290Inthe“Large”and“CommunitySolar”categoriesthepriceslistedincludetheSizeCategoryAdjustmentsdescribedinSection6.5.1.


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Figure6‐1:GroupABlocks

Figure6‐2:GroupBBlocks

$0.00

$20.00

$40.00

$60.00

$80.00

$100.00

$120.00

<=10kW

>10 ‐25 kW

>25 ‐100kW

>100 ‐200kW

>200 ‐500kW

>500 ‐2,000kW

<=10kW

>10 ‐25 kW

>25 ‐100kW

>100 ‐200kW

>200 ‐500kW

>500 ‐2,000kW

Small Large Community Solar

Group A: Ameren Illinois, MidAmerican, Mt. Carmel, Rural Electric Cooperatives and Municipal Utilities

located in MISO

Block 1

Block 2

Block 3

$0.00

$20.00

$40.00

$60.00

$80.00

$100.00

$120.00

<=10kW

>10 ‐25 kW

>25 ‐100kW

>100 ‐200kW

>200 ‐500kW

>500 ‐2,000kW

<=10kW

>10 ‐25 kW

>25 ‐100kW

>100 ‐200kW

>200 ‐500kW

>500 ‐2,000kW

Small Large Community Solar

Group B: ComEd, and Rural Electric Cooperatives and Municipal Utilities located in PJM

Block 1

Block 2

Block 3


101

6.5. AdjustmentsandAddersThe following set of adjustments andAdders are intended to adjust the base REC price tomeetspecific additionalpurposes.These includeadjusting for systemsize, adjusting for theadditionalcosts of small subscribers to community solar, andpotentially accounting for the changes to netmetering,smartinverterrebatesandfederaltaxcredits.

WhiletheActseekstoencourageprojects“indiverselocations…notconcentratedinafewgeographicareas,”291atthistimetheAgencyisnotproposinganyspecificgeographicadders.Thesplitoftheblocksbetweenutilityserviceterritoriesshouldhelpaddressgeographicdiversity,andtheAgencynotes that for the Supplemental Photovoltaic Procurements (which featured no geographicpreferences),resultingnewphotovoltaicsystemshavebeenwelldistributedacrossthestate.

Nevertheless,theAgencywillreviewthisdeterminationaspartofthePlanupdate,andifgeographicdiversityisnotbeingsufficientlyachieved,theAgencymayproposeageographicadderinthefuturetoencourageprojectsinunderrepresentedareas.

6.5.1. SizeCategoryAdjustmentsTheAgencyproposesasetofadjustmentsbasedonprojectsizeforprojectsgreaterthan10kWandupto2,000kW.Astherearesignificanteconomiesofscaleforlargersystemscomparedtosmallersystems,theAgencybelievesthatsettingasingleRECpriceforallprojectsinthisrangewilleitherover‐incentivizelargeprojectsorunder‐incentivizesmallprojects.Havingadiversityofprojectsizesisimportantforcreatingahealthyanddiversedistributedsolarmarket,withrobustopportunitiesforparticipationbyallcustomers.TheseadjustmentsreflectRECpricingtoreasonablymatchsystemsizes.

These adjustmentswill only be available for systems over 10 kW in size in both the Large andCommunitySolarcategories.TheAgencydoesnotbelievetherewillbesignificantcostdifferencesfor systems in the “no more than 10 kW” category that would require adjustments within thatcategory;therefore,theupto10kWcategoryisasinglecalculatedprice.

Table6‐3:SizeCategoryAdjustments

Size$/REC

GroupA GroupB

Over10kWto25kW $37.17 $35.89

Over25kWto100kW $20.93 $20.93

Over100kWto200kW $8.18 $8.18

Over200kWto500kW $2.29 $2.29

Over500kWto2000kW Noadjustment Noadjustment

29120ILCS3855/1‐75(c)(1)(K).


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TheseadjustmentswerecalculatedusingtheRECpricingmodeldescribedinSection6.4withthesystemcostsbasedona typical sized system foreach size category.While theadjustmentswerecalculatedusingtheRECPricingModelasdescribedabove,theAgencynotesthattheresultinghigherREC prices for smaller systems could lead to more systems being developed, which may helpencouragethegeographicdiversityofthesystemlocations.

The totalcapacityofdistributedgenerationsystemsenergizedafter June1,2017atacustomer’slocationwillbeconsideredasinglesystem.292(Forexample,three100kWsystemsatasinglelocationwillbeconsidereda300kWsystem.)Ifasystematasinglelocationissubsequentlyexpanded,theAgencyreservestherighttorevisetheincentiveamountspaidfortheoriginalsystem,andtosetnewincentivesbasedon the total expanded system size rather than just the treat the expansion as aseparatesystem.Forthepurposeofestablishinganincentivelevel,asystem’slocationwouldbeasinglebuilding(regardlessofthenumberofutilityaccountsatthelocation)forrooftopinstallations,and a single property parcel for ground‐mounted systems (if a property had both rooftop andground‐mountedsystems,itwillbeconsideredasinglesystem).293Exceptionswillbemadeifitcanbe demonstrated that two projects on one roof serve to offset the load of separate occupants(residentialorcommercial)ofabuilding.Additionaldiscussionofco‐locationofcommunitysolarprojects is included in Section 7.3. For the purposes of consideration of co‐location, distributedgenerationsystemsandcommunitysolarprojectswouldbeconsideredseparatelyandnotimpacteachother.

6.5.2. CommunitySolarCommunitysolarprojectsmayfaceadditionalcostsandfeaturereducedeligibilityfordirectenergy‐related revenues than distributed generation systems. On the revenue side, subscribers to suchprojectsareeligibleonlyforenergy‐onlynetmetering,294whileonthecostside,thereisthecostofacquiring,maintaining,andmanagingsubscribers.ThepricesforcommunitysolarRECsreflectthosedifferences.TheRECpricesfortheseprojectsalsoincludestheSizeCategoryAdjustmentsdiscussedabove.

ToensurethatthebenefitsofsolarenergyarewidelysharedbyIllinoisresidents, theAdjustableBlockProgramwillofferanadditionalincentiveforcommunitysolarprojectswithahigherlevelofsmallsubscribers(residentialandsmallcommercialcustomerswithsubscriptionsbelow25kW).Toaccount foradditionalcostsrelatedtosmallsubscribers, the followingscheduleofadderswillbeavailable to community solar projects that haveminimum levels of small subscribers. Formorediscussionofissuesrelatedtosmallsubscribers,seeSection7.6.2.

292AnysystemdevelopedunderthisprogramwouldrequireaseparateGATSorM‐RETSIDfromanysystemdevelopedthroughadifferentprogram(e.g.,theSupplementalPhotovoltaicProcurementortheUtilityDGprocurements)orwithoutprogrammaticsupport.ThiswouldallowforacleardemarcationbetweensystemsandtheirassociatedRECs.293 Please note that this is a different standard than the IPA used for determining the size of co‐located systems participating in itsSupplementalPhotovoltaicProcurementprocess,forwhichtheseparatemeasurementofasystem’soutputcouldbeusedtoestablishthatsystem’ssize(thusallowingco‐locationmoreliberallywhilestillretainingeligibilityforasmallersystemsize).294220ILCS5/16‐107.5(l)(2).TheIPAalsonotesthatinICCDocketNo.17‐0350,theproceedingtoapproveComEd’sproposedcommunitysolarnetmeteringtariffpursuanttoSection16‐107.5(l‐5)ofthePUA,severalpartiesarguedthatvolumetrictransmissionchargesshouldbepartofthenetmeteringsupplycreditgrantedtocommunitysolarprojects,whileComEdarguedthattransmissionchargesshouldbeexcluded.TheCommission’sSeptember27,2017Orderinthismatterdetermined(page15)thatthetransmissionserviceschargeshouldbeexcludedfromthecommunitysolarnetmeteringcredit.


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Table6‐4:CommunitySolarAdders

Adder$/REC

GroupA GroupB

Lessthan25%smallsubscriber NoAdder NoAdder

25%to50%smallsubscriber $11.17 $10.88

Over50%to75%smallsubscriber $22.34 $21.77

Greaterthan75%smallsubscriber $33.51 $32.65

Thesmallsubscriberadderswillbedeterminedonthepercentageoftheenergyoutputoftheprojectsubscribedtobysmallsubscribers,andnotthenumberofsmallsubscribers.AsdescribedinmoredetailinSections6.15.3and6.17,acommunitysolarprojectwillhavetodemonstratealevelofsmallsubscribersatthetimeofenergizationtoreceiveanadderinitially,andwillhavetomaintainthesmallsubscribersubscriptionlevelsorfacehavingtopaypenaltiestoremovetheaddedvalueoftheaddersifthelevelisnotmaintained.

At this time, the Agency is not proposing an Adder thatwould distinguish between “developer‐driven”projectsand“community‐led”projects.Suchadistinctionmaybedifficulttomakeinpractice,may invite opportunities for abuse, and may create additional complexities to programadministration.TheAgencybelievesthecombinationoftheSizeCategoryAdjustment,whichwouldprovide benefits to smaller projects, plus the option of participating in the Illinois Solar for Allcommunity solar program, adequately addresses the needs of those types of projects. Formoredetailsonthisdetermination,seeSection7.5.

6.5.3. AdderstoAdjustforChangingSystemRevenueAsdiscussedinSection6.8.1below,theAgencyanticipatesthatasnetmeteringcapsaremet,smartinverterrebatesareadjustedorcreated,andFederaltaxincentivesdecrease,therevenueasystemwouldreceivefromothersourceswilldecline.NotaccountingforthatinRECpricescouldmakeasystemthatwouldhavebeeneconomicallyviablenolongerviableafterthosedecreases.

Atthistime,theAgencyisnotproposingspecificadderstoaddressthesechallenges,butnotesthatSection1‐75(c)(1)(M)oftheActprovidesthat“[p]rogrammodificationstoanyprice,capacityblock,orotherprogramelementthatdonotdeviatefromtheCommission'sapprovedvaluebymorethan25%shalltakeeffectimmediatelyandarenotsubjecttoCommissionreviewandapproval,”allowingtheAgencytomakesmalladjustmentstoRECpricestoaccountforcertainchallenges.Ifnecessary,the Agencywill use this authority to propose adders to account for these changes following theprocessdescribedinSection6.8,orutilizetheCommissionapprovalprocessforrevisingitsPlanforanylargerchanges.

6.6. PaymentTermsTheActsetsupaclearscheduleofpaymentsforRECsforprojects.Section1‐75(c)(1)(L)specifiesthefollowingschedule.


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Forsystemsupto10kW,“therenewableenergycreditpurchasepriceshallbepaidinfullbythecontractingutilitiesatthetimethatthefacilityproducingtherenewableenergycreditsisinterconnectedatthedistributionsystemleveloftheutilityandenergized.”

Fordistributedgenerationsystemsgreaterthan10kWandupto2,000kWandcommunityrenewablesolarprojects,“20percentoftherenewableenergycreditpurchasepriceshallbepaidbythecontractingutilitiesatthetimethatthefacilityproducingtherenewableenergycredits is interconnectedat thedistributionsystem levelof theutilityandenergized.Theremainingportionshallbepaidratablyoverthesubsequent4‐yearperiod.”

The Agency proposes that the standard for being “energized” as used above must include thecompletionoftheinterconnectionapprovalbythelocalutilityandtheregistrationofthesysteminGATSorM‐RETSsothatgenerationdatacanbetrackedandRECscreated.295Inaddition,asdiscussedinSection6.15.4,toavoidasystembeingcompletedbutRECsnotcreatedanddelivered,beforeasystemcanbeconsidered“energized”soastoinitiatetheprocessingofaninvoiceforRECdeliverycontractpayments,automaticassignmentofRECstotheapplicableutilitywillneedtobeestablishedTheAgencybelieves that by ensuringproper registration in the tracking systemup front, futureadministrativechallengescanbeminimized.

Forsystemsover10kWandcommunitysolarprojects,itisnotclearfromthelawhowexactlythe“subsequent4‐yearperiod”wouldbecalculated,andwhetherthefrequencyofpaymentsshouldbeannually,quarterly,ormonthly.TheAgencyproposesthatafterthefirstpaymentof20%,thebalanceofpaymentsbemadeonaquarterlybasisoverthefollowing16quarters.Forexample,ifthefirstpayment is made on September 1, 2018 (upon interconnection and energization), assumingcontinuedcompliancewithcontractualrequirements,thenextpaymentswouldoccurapproximatelyonDecember1,2018,March1,2019,etc.,withthefinalpaymentonapproximatelySeptember1,2022.Thiswouldbe17totalpaymentsthatbookendafour‐yearperiodoftime.PaymentamountswouldbeonasetscheduleandcouldbeadjustedtoreflectchangesinRECquantities(perSection6.16.2),orcommunitysolarsubscriptionlevels(perSection6.15.4).

Section1‐75(c)(1)(L)alsorequiresthat:

(vi)If,atanytime,approvedapplicationsfortheAdjustableBlockprogramexceedfundscollected by the electric utility orwould cause the Agency to exceed the limitationdescribedinsubparagraph(E)ofthisparagraph(1)ontheamountofrenewableenergyresources thatmaybeprocured, then theAgency shallconsider futureuncommittedfunds to be reserved for these contracts ona first‐come, first‐served basis,with thedeliveryofrenewableenergycreditsrequiredbeginningatthetimethatthereservedfundsbecomeavailable.

The Agency does not currently anticipate that approved applications for the Adjustable BlockProgramwillexceedfundscollected.However,theAgencywillmonitorthissituationandaddressanypotentialconcernsingreaterdetailinthenextPlanupdate.

295ThisproposedstandardisonlyintendedtorelatetothecontractualpaymenttermsfortheProgram.Section1‐75(c)(1)(K)specifiesthat,“[o]nlyprojectsenergizedonorafterJune1,2017shallbeeligiblefortheAdjustableBlockprogram.”TheAgencyviewsthistomeanthataprojectmustbeinterconnectedtotheapplicableutilityafterJune1,2017andthattheregistrationdateofthesysteminGATSorM‐RETSdoesnotimpactthatdetermination.TheaddedcontractualstandardismeanttoensurethatenergizedsystemswillproducetheRECsthattheyarereceivingupfrontpaymentsfor.


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AdditionalprovisionsofSection1‐75(c)(1)(L)requirethat:

“Theelectricutilityshallreceiveandretireallrenewableenergycreditsgeneratedbytheprojectforthefirst15yearsofoperation.”

“Eachcontractshallincludeprovisionstoensurethedeliveryoftherenewableenergycreditsforthefulltermofthecontract.”

TheseprovisionsarediscussedfurtherinSection6.16.

6.7. ContractsTheAgencynotesthatwhilepaymentswillbemadeaccordingtothetermsdescribedinSection6.6,the Adjustable Block Program and its REC delivery contracts will feature ongoing performancerequirementstoensurethatRECsaredeliveredacrossthe15‐yeartermofthecontracts,especiallyafter payments have been made. Section 6.16 describes in more detail how those performancerequirementswillbeimplemented.

TheAgency,inconsultationwithitsProgramAdministratorand/oritsProcurementAdministrator,willdevelopstandardRECdeliverycontractsbetweentheutilitiesandApprovedVendorsmuchasits Procurement Administrator has done for the competitive procurement processes. This willincludetheopportunityforinterestedpartiestocommentonthecontracts.UltimatelythecontractswillreflecttheconsensusoftheAgency,theutilities,andCommissionStaff.Contracts,oncefinalized,willnotbesubjecttonegotiation.

Theinitialcontracts—thosefirstdevelopedunderthisprocess—willbeusedthroughtheendofthe2018‐2019 delivery year. On an annual basis, the Agency will review and update the contractsthroughaprocessthatincludesinputfrominterestedparties.

TheAgencynotesthattheActprovidesthat“[n]ocontractshallbeexecutedforanamountthatislessthanonerenewableenergycreditperyear.”296Giventhateachcontractwillbeforabatchofprojectsthat,tobeapproved,mustbeforatleast75kW,297thisminimumrequirementwillbeeasilymet.(SeeSection6.14formoreinformationonbatches.)

Contractswill be assignable.Theassigneemust agree to, andabideby, theapplicable termsandconditionsrequiredofanApprovedVendor(oraSingleProjectApprovedVendorinthecaseoftheassignmentofasingleprojectfromacontract).

6.8. AdjustmentstoBlocksandPricesTheActcontainstwoprovisionsthatallowtheAgencytoreviewandadjustblockquantities,sizes,andprices.TheprovisionsarecontainedinSection1‐75(c)(1)(K):

“TheAgencymay periodically review its prior decisions establishing the number ofblocks,theamountofgenerationcapacityineachblock,andthepurchasepriceforeachblock,andmaypropose,onanexpeditedbasis,changestothesepreviouslysetvalues,includingbutnot limited toredistributing theseamountsand theavailable fundsas

29620ILCS3855/1‐75(c)(1)(L)(v).297Whiletheminimumbatchsizeis100kW,75%ofthecapacityofthesystemsinabatchmustbeapprovedforthecontracttobeexecuted.


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necessaryandappropriate,subjecttoCommissionapprovalaspartoftheperiodicplanrevisionprocessdescribedinSection16‐111.5ofthePublicUtilitiesAct.”

AndinSection1‐75(c)(1)(M):

“If necessary, the Agencymaymake prospective administrative adjustments to theAdjustable Block program design, such as redistributing available funds ormakingadjustmentstopurchasepricesasnecessarytoachievethegoalsofthissubsection(c).Programmodificationstoanyprice,capacityblock,orotherprogramelementthatdonotdeviatefromtheCommission'sapprovedvaluebymorethan25%shalltakeeffectimmediately and are not subject to Commission review and approval. Programmodificationstoanyprice,capacityblock,orotherprogramelementthatdeviatemorethan25%fromtheCommission'sapprovedvaluemustbeapprovedbytheCommissionasalong‐termplanamendmentunderSection16‐111.5ofthePublicUtilitiesAct.TheAgencyshallconsiderstakeholderfeedbackwhenmakingadjustmentstotheAdjustableBlockdesignandshallnotifystakeholdersinadvanceofanyplannedchanges.”

Inessence,changesoflessthan25%canbemadebytheAgencywithoutseekingreviewandapprovalfrom the Commission,while larger changeswill require that review and approval as part of theAgency’sregularannualprocurementplanningprocess.

TheAgencyisawareoffourkeyeventsthatcouldsignificantlyimpactRECpricing.Thefirstisthatwhenautilityreachesitsnetmeteringcap(seeSection6.8.1formorediscussion),netmeteringfornew enrollments by distributed generation systems will change from full retail net metering toenergy‐onlynetmetering.Thesecondisthat,uponthenetmeteringcapbeingmet,thedistributedgenerationrebateforsmartinverterswillchangefrom$250/kW(fornon‐residentialcustomersandcommunityrenewableparticipants)toarebatebaseduponthelocationalvalueofthesystemtothegrid,whileanewdistributedgenerationrebatewillbecreatedforresidentialcustomers.ThethirdisthattheFederalSolarInvestmentTaxCreditwillstepdownfrom30%to26%forprojectsthatstartconstructionin2020,andthento22%in2021;itwillbeeliminatedforresidentialprojectsafterthattimeandbereducedto10%forotherprojects.Andfourth,twoU.S.solarpanelmanufacturersfiledapetitionwiththeUnitedStatesInternationalTradeCommission(“ITC”)allegingunfairtradepractices.298OnSeptember22,2017,theITCvotedinagreementwiththatclaimanditisnowmovingtowards a relief phase that could result in tariffs or other trade restrictions being imposed onphotovoltaicmodulesandcellsfromcertainforeigncountries.

EachofthesechangeswouldimpactthevaluepropositionfordevelopingaprojectandcouldrequireanadjustmentinRECpricestokeepprojectdevelopmentviable.TheAgencywillnotifystakeholdersandprovideopportunitiesforfeedbackforchangestoreflectthesecircumstances,orothersthatmayarisethatwouldalsorequirechangestobemade.

In addition to these factors, and in keeping with the adjustable nature of the Adjustable BlockProgram,theAgencyrecognizesthatdespiteitsbesteffortstosetREC(andAdder)pricesat“justright”levels,itispossiblethatfactorsthatimpactpricesmayneedtobeupdatedtoreflectchangingmarketdynamics.Inresponsetoveryloworveryhighdemandfortheprogram,theAgencymayadjustRECandAdderprices,blocksizes,andothervariablesasneededtomaintainavigorousand

298 United States International Trade Commission, Investigation No. TA‐201‐75, Crystalline Silicon Photovoltaic Cells,https://www.usitc.gov/investigations/title_7/2017/crystalline_silicon_photovoltaic_cells_whether_or/safeguard.htm.


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healthymarket fordistributed solar and to reachprogrammatic goals. TheAgencywillmonitorprogramactivityandconsidersuchchangeifitdeterminestheyarewarranted.

TheAgency intends towait at least sixmonths after program launch before consideringmakingsignificant changes to help encourage program stability. However, if program participation isextremelylow,orifitbecomesclearthatRECpricesweresettoohigh,theAgencymayelecttoactsoonerthanthat.

WhentheAgencybecomesawareofasituationthatwouldrequireachangetoblockquantities,size,price,orotherfactors,including,butnotlimitedto,thesituationsdescribedherein,theAgencywillpost an announcement to its website regarding the proposed changes and will hold either astakeholder meeting, or an online webinar to provide an opportunity for stakeholder input.Stakeholderswill alsobe invited to submitwritten commentson theproposedmaterial changeswhichwillbepostedtotheAgency’swebsite.TheAgencywillconsiderfeedbackitreceivespriortofinalizing changes it makes that are less than 25% and do not require Commission review andapproval,andwilllikewiseconsiderthatfeedbackinfilingsmadebeforetheCommissiontoupdatetheAdjustableBlockProgram.

6.8.1. NetMeteringCapAdjustmentUnder Section 16‐107.5(j) of the PUA, net energymetering is generally credited at a value thataccountsforthevalueofenergyanddeliveryuntilnetmeteringaccountsfor5%ofthetotalpeakdemand of each electricity provider’s eligible customers. At that time, netmetering for any newinstallationswillbeforenergyonly.299

TheAgencywillworkwiththeutilitiestokeepinformedonwhenthenetmeteringcapsmaybemet.At that time, theAgencywill review theperformanceof theprogramandmakeprice andpolicyadjustmentsneededtoachievecompliancewithRPSgoals.Asnotedabove,theAgencywillbeabletomakeadjustmentstooffsettheimpactofthechangeinnetmeteringrevenueiftheyarelessthana25%changeinthepriceofRECs.Ifthechangeinpriceisgreaterthan25%,thentheAgencywillbeable to cap the adder and block price adjustment at 25%andwill seek Commission review andapprovalofarevisedscheduleofRECpricesasoutlinedinSections1‐75(c)(1)(K)and(M)oftheAct.Atthistime,theAgencydoesnotexpectthenetmeteringcaptobemetpriortoitsnextPlanrevisioncycle(i.e.,notbeforetheFallof2019).

6.8.2. SmartInverterRebateUnderSection16‐107.6(e)ofthePUA,whenautilityreachesnetmeteringloadequaling3%ofitstotalpeakdemand,theCommissionwillinitiateaninvestigationtoadjustthesmartinverterrebatefrom$250/kW (for non‐residential customers and community renewable participants) to a newvalue, and to establish an initial smart inverter rebate value for residential customers. Once theresultingrebatevalueisapprovedbytheCommission,itwilltakeeffectwhentheloadofnetmeteringenrollmentforthatutilityreaches5%oftheutility’stotalpeakdemand.Itiscurrentlynotclearifthe5%levelwillbereachedbeforetheendofthe2020deliveryyear,andevenifitis,ifanyoftheplansforchangingtheinverterrebatewillhavebeenapprovedbytheCommission.Therefore,atthistimetheAgencyisnotproposingaspecificaddertoadjustforthechangetotheinverterrebate(whichcouldalsobeanincreaseintherebatelevelforsomeprojectsthusnotrequiringanynewAdders).

299220ILCS5/16‐107.5(j),(n).


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TheAgencywilltakepartineachutility’sinvestigationproceedingandwillconsiderproposingnewAdders,ifneeded,asthoseinvestigationsproceed.TheadoptionofanynewAdderwilleitherfollowtheprocessoutlinedinSection6.8oraspartofthePlanupdate.

6.8.3. FederalSolarInvestmentTaxCreditAdjustmentTheU.S.Congresshassetascheduleforadeclineandpartialphaseoutoffederaltaxcreditsforsolarphotovoltaics.300 Projects that start construction in 2017, 2018, and 2019 will receive a 30%InvestmentTaxCredit;projectsthatstartconstructionin2020and2021willreceive26%and22%,respectively; for construction starts after that, the credit will drop permanently to 10% forcommercialprojectsand0%forresidentialprojects.301After2015legislation,projectownerswhostartconstructionbefore2022mayclaimtheapplicablecreditonceconstructionbegins,aslongastheprojectisoperationalbytheendof2023.

Additionally,federaltaxlegislationcurrentlybeingconsideredbytheU.S.CongressasofthetimeoffilingofthisPlancouldalterthestructureandscheduleoftheInvestmentTaxCreditforsolarpowerfacilities. OnNovember16,2017, theU.S.HouseofRepresentativespasseda taxreformbill thatwouldendtheInvestmentTaxCreditforsolarprojectsthatbeginconstructionafter2027andalsorequirea“continuousprogramofconstruction”prior toagivencutoffdate inorder toqualifyashavingstartedconstructionforthatdate.302

IntheearlymorninghoursofDecember2,2017,theU.SSenatepassedanamendedversion303ofthesamebill,captionedH.R.1.IncontrastwiththeU.S.Houseversion,theSenatebillwouldnotaltertheInvestmentTaxCredit.However,theSenatebillintroducedaprovisioncalledtheBaseErosionAnti‐AbuseTax.304Theprovisiondefinesanewconceptofa“baseerosionminimumtaxamount”thatcertaincorporationswillpay,equaltotheexcess(ifany)of:

(A)10percent(12.5%after2025)ofacompany’smodifiedtaxableincome,305minus

(B) the company’s regular tax liability, reduced by the tax credits towhich it is entitled(excludingtheR&Dcreditunder26U.S.C.§41).306

Thisprovision,ifenactedintolaw,wouldapplytocorporationswithaverageannualrevenuesofatleast $500million andwhichmake certain levels of tax‐deductible transfer payments to foreignaffiliates.307ThisprovisioniswidelythoughttodiminishthevalueoftheInvestmentTaxCreditforsolar generation for “tax equity” investors,which are oftenparts of largemultinationals. To theextent that thepotential investor’sU.S. income tax liability for a givenyearwould fall below the

300ConsolidatedAppropriationsActof2016,PublicLaw114‐113,December18,2015,at§303(modifying26U.S.C.§48(a));seealsohttps://energy.gov/savings/business‐energy‐investment‐tax‐credit‐itc,https://www.seia.org/research‐resources/impacts‐solar‐investment‐tax‐credit‐extension.30126U.S.C.§§48(a)(2)(A),(a)(3)(A)(i),(a)(6)(A).302 115th Congress, H.R. 1, https://www.congress.gov/115/bills/hr1/BILLS‐115hr1eh.pdf, at 279 (proposing to modify 26 U.S.C. §48(a)(3)(A)(i)andtoaddnew§48(c)(5)).Seealsohttps://solarindustrymag.com/what‐the‐house‐gop‐tax‐plan‐could‐mean‐renewable‐energy;https://www.greentechmedia.com/articles/read/house‐tax‐bill‐impact‐on‐wind‐solar‐electric‐cars.303https://www.budget.senate.gov/imo/media/doc/TAX%20SUBSTITUTE.pdf.304Id.at450‐469(proposingtoaddnew26U.S.C.§59A).305“Modifiedtaxableincome”willbecalculatedbynotincludingtheeffectofforeigntransferpayments.Id.at453(proposednew26U.S.C.§59A(c)(1),(2)).306Id.at450‐451(proposednew26U.S.C.§59A(a),(b)(1)).307Id.at458‐459(proposednew26U.S.C.§59A(e)(1)).


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defined10%levelafterdeductingtheInvestmentTaxCreditfromtaxliability,theinvestorwouldessentiallyberequiredtopaybacktheInvestmentTaxCredittotheU.S.Treasury.308Thestatusofthetaxcreditcouldchangefromyeartoyeardependingontheinvestor’sbroadertaxandfinancialprofile.

Typically,whentheU.S.HouseandSenatepassdifferentversionsofabill,thetwoversionsgotoaconferencecommitteewherethelegislatorstrytoreconcilethedifferences,andthenthereconciledbillwouldbevotedonagainbyboththeHouseandSenate,andifitpassesboth,wouldthenbesenttothePresidentforsignature.AsofthedateofthefilingofthisPlanforapprovalbytheCommission,itisnotyetknownwhenandhowthatprocesswilltakeplace.

The phase‐out of the federal Investment Tax Credit, and any possible legislative change to thatschedule, will affect project economics for distributed solar in Illinois. Like other anticipatedchanges, the Agency will review the performance of the program and make price and policyadjustmentsneededtoachievecompliancewithRPSgoals.Forexample,theAgencycouldofferanaddertoreflectthechangeinthefederalInvestmentTaxCreditfrom30%to26%.Thisadjustmentwillprobablynotbelargerthan25%,sowouldnotrequireCommissionreviewandapproval.ThePlanUpdatescheduledtobeconductedin2019forimplementationin2020willaddressanyfutureadjustmentsforprojectsthatstartconstructionin2021orlater.

6.8.4. TariffsonForeignPhotovoltaicModulesandCellsOn May 17, 2017, Suniva, Inc., a Georgia (U.S.)‐based maker of crystalline silicon photovoltaic(“CSPV”) cells and modules, filed an amended petition for import relief at the United StatesInternationalTradeCommission(“ITC”)underSections201and202(a)ofthefederalTradeActof1974,19U.S.C.§§2251,2252(a),allegingthatimportsofthesameproductarebeingimportedintotheUnitedStatesinsuchincreasedquantitiesastobeasubstantialcauseofseriousinjury,orthethreatthereof,tothedomesticindustry.309SolarWorldAmericas,Inc.,anotherU.S.manufacturerofCSPV modules, joined the petition on May 25, 2017. The joint petitioners proposed a tariff of$0.40/wattonimportedCSPVcellsandafloorpriceof$0.78/wattonimportedCSPVmodules. AhearingonthisharmissuewasheldattheITConAugust15,2017.

OnSeptember22,2017,theITC,exercisingitsauthorityunderSection202(b)oftheTradeAct,voted4‐0tofindthattherewasaseriousinjurycausedbytheimportationofcrystallinesiliconphotovoltaiccellsandmodules.TheITCruledtoexcludeSingapore,Australia,Canada,andotherfreetradepartnercountries from the finding—although it found serious injury caused by imports from free tradepartnersMexicoandSouthKorea.310

308SeealsoKeithMartin,“UStaxequitymarketcouldshrinkunderSenatebill,”NortonRoseFulbrightLLP,November22,2017,availableat: http://www.nortonrosefulbright.com/knowledge/publications/158454/us‐tax‐equity‐market‐could‐shrink‐under‐senate‐tax‐bill;ChristianRoselund, “Senateapproves taxbill, likelywithprovision tohobble ITC,PTC,”PVMagazine,December2,2017,availableat:https://pv‐magazine‐usa.com/2017/12/02/senate‐approves‐tax‐bill‐likely‐with‐provision‐to‐hobble‐itc‐ptc.309See82Fed.Reg.25331‐25333,June1,2017(https://www.usitc.gov/trade_remedy/731_ad_701_cvd/investigations/2017/Solar%20Panels/Safeguard/cspv_‐_institution.pdf).310 See, e.g., “Solar Tariff Case Advances as ITC Finds ‘Injury’,” Greentech Media, September 22, 2017,https://www.greentechmedia.com/articles/read/solar‐trade‐case‐advances‐as‐itc‐finds‐injury; see alsoU.S. ITCNewsRelease17‐133,September22,2017,https://www.usitc.gov/press_room/news_release/2017/er0922ll832.htm.


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Ahearingregardingremedieswasheldat theITConOctober3,2017.311The ITCCommissionersannounced their remedy recommendations on October 31, 2017.312 The ITC issued a lengthierwrittenreportcontainingitsinjuryfindingsandremedyrecommendationsduetotheU.S.PresidentonNovember17,2017,313satisfyingitsobligationunderSections202(e)and(f)oftheTradeAct.TheITC’sChairmanrecommendedatariffonCSPVcellsof10%advaloremforthefirst500MWofimportsinagivenyearandthena30%tariffrateforadditionalimports.314ForCSPVmodules,theChairmanrecommendeda35%tariffrate.315Inallcases,theChairman’srecommendedtariffrateswoulddeclinesteadilyoverthesecond,third,andfourthyearsofa four‐yeartariffprogram. TheChairmanalsorecommendedthatthePresidentinitiateinternationalnegotiationsto“addresstheunderlying cause of the increase in imports of CSPV products and alleviate the serious injurythereof.”316 TwootherCommissioners issueda joint remedyproposal similar instructure to theChairman’s.317 A fourth Commissioner issued a recommendation that the President impose aquantitativerestrictiononimportsofCSPVproducts,includingcellsandmodules,startingat8,900MWinthefirstyearandincreasingannuallyby1,300MWineachofthesecond,third,andfourthyears of a four‐year quota program; she also recommended that the quotas be administered viaimport license auctions at a minimum price of $0.01/watt, with auction revenue used to assistdomesticCSPVmanufacturers.318

OnNovember27,2017,theUnitedStatesTradeRepresentative,exercisingthePresident’sauthorityunder Section 203(a)(5) of the Trade Act, asked the ITC for additional information to assist thePresidentin“determiningtheappropriateandfeasibleactiontotakethatwillfacilitateeffortsbythedomestic industry to make a positive adjustment to import competition and provide greatereconomicandsocialbenefitsthancosts.”TheTradeRepresentativeaskedtheITCto“identifyanyunforeseendevelopmentsthatledtothearticlesatissuebeingimportedintotheUnitedStatesinsuchincreasedquantitiesastobeasubstantialcauseofseriousinjury.”319Followingthisletter,theITChasuntilDecember27,2017torespond;thePresidentwillthenhaveuntilJanuary26,2018tomakeadecisiononwhat tariffsorother trade restrictions to impose,under the requirementsofSection203(a)oftheTradeAct,19U.S.C.§2253(a).IfthePresidentdoesnotfullyadopttheITC’srecommendations,theU.S.Congresshastheoption,pursuanttoSection203(c)oftheTradeAct,ofenacting the ITC’s recommended action via a joint resolution by 90 days after the Presidentannounceshisdecision.320

311https://www.usitc.gov/calendarpad/events/usitc_hearing_crystalline_silicon_photovoltaic_.htm_0.312https://www.usitc.gov/press_room/news_release/2017/er1031ll857.htm;https://www.usitc.gov/sites/default/files/press_room/documents/solar201_remedy_commissionerstatements.pdf.313U.S.ITC,CrystallineSiliconPhotovoltaicCells(WhetherornotPartiallyorFullyAssembledintoOtherProducts),InvestigationNo.TA‐201‐75, Volume I: Determination and Views of Commissioners, Publication 4739, November 2017, available at:https://www.usitc.gov/publications/safeguards/pub4739‐vol_i.pdf.314Id.at2.315Id.316Id.317Id.318Id.at3.319 Joe Ryan, “Trump Seeks Details on Solar Imports Before Setting Tariffs,” Bloomberg Markets, November 29, 2017, available at:https://www.bloomberg.com/news/articles/2017‐11‐29/trump‐seeks‐more‐detail‐on‐solar‐imports‐before‐setting‐tariffs; also seehttps://d12v9rtnomnebu.cloudfront.net/paychek/1243576‐629905.pdf(letterfromUnitedStatesTradeRepresentative).320 The ITC’s November 17, 2017 report to the President under Section 202(f) of the Trade Act did not contain a single unifiedrecommendation,soitisunclearhowCongress’sSection203(c)powertooverridethePresident’sdecisionunderSection203(a)wouldapplyinthiscase.


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ThiscreatesabitofadilemmafortheAgencyregardingthecalculationofRECprices.Thepricescontained in this Plan do not reflect any impact from potential tariffs. It is unclear what traderestrictions,ifany,thePresidentwillannounce.TheAgencyintendstoupdatetheinputsintotheRECpricingmodeltoreflectanytariffsorothertraderestrictionsoncetheyareimposedbythePresidentunderSection203(a)oftheTradeActonorbeforeJanuary26,2018.TheAgencywillfilethisupdatein the instant Commission proceeding as soon as practicable following the President’sannouncement.

6.9. ApprovedVendorsParticipation in the Adjustable Block Programwill take place through, and conditional upon, anApprovedVendorprocessdevelopedbytheAgency.TheApprovedVendormodelisbasedupontheexperiencestheAgencygainedthroughthedevelopmentandimplementationoftheSupplementalPhotovoltaicProcurementaswellasobservationsofprogramsinotherstates.Whilearguablytherecouldbemore flexibilityavailable to consumers throughaprogramunderwhichanyentitymayreceive a contract, by having Approved Vendors—i.e., ensuring that any entity receiving a RECdeliverycontractisregisteredwithandvettedbytheAgency,andhasmetconditionspredicate—theAgencywillbebetterabletomonitorcompliancewithprogramtermsandconditions,ensuretheaccuracy and quality of information submitted, and reduce the administrative burden on thecontractualcounterparties.Themodelwillbenefitconsumersbecausetheywillbeabletoverifythatanentitythatproposestodevelopaphotovoltaicsystemforthem(orsellthemasubscriptiontoacommunitysolarproject)isalegitimateentityparticipatingintheprogram.AnApprovedVendorthatfailstoliveuptotherequirementsoftheAdjustableBlockProgramandisa“badactor”couldhave a significant negative impact on the entire renewable energymarket in Illinois thatwouldextendbeyondjustitsownactions.ItisimportantfortheAgencytohavetheabilitytomonitortheprogramandensurehighqualityperformancebytheApprovedVendors.

TheAgencydoesnotanticipaterestrictingApprovedVendorsbytheentitytype;assuch,thetypesofApprovedVendorscouldincludeacompanythatspecializesintheaggregationandmanagementofRECs; a for‐profit developer or installer of photovoltaic systems; amunicipality; or non‐profitservingaspecificsectorofthecommunity,amongothers.

ApprovedVendorswillbetheentitythatisthecontractualcounterpartywiththeutility,andthuswillbetheentitythatreceivespaymentsfromtheutilityforRECdeliveriesascontractobligationsaremet.ApprovedVendorsarethereforetheentitiesresponsibleforsubmittingpaperworktotheProgramAdministrator(astheresponsiblepartyfortheinformationcontainedinthatpaperwork),maintainingcollateralrequirements,andprovideongoinginformationandreporting.Assuch,theApprovedVendorswillhavetocoordinatethedownstreaminformationfrominstallers/developersas well as individual system owners (who may well provide required information through theinstaller/developer).

The Agency will not require a specific delegation of duties between the Approved Vendor,installer/developer,andsystemowner,ratheritbelievesthatthemarketisbettersuitedtoallowavarietyofbusinessarrangementstodevelop.ThekeyconsiderationisthattheApprovedVendorisultimately responsible for the fulfillment of contractual obligations, including any obligationsdelegatedtosubcontractors,inamannerconsistentwiththerequirementsofthisPlanandoftheApprovedVendor’scontractwiththecounterpartyutility.

ApprovedVendorswillhavetoagreetothefollowingterms:


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ParticipateinregistrationandcompleteanytrainingdevelopedbytheAgency Abidebytheseongoingprogramtermsandconditions ProvideinformationtotheAgencyontheApprovedVendor’sorganizationalhistory,capacity,

financial information, regulatory status in Illinois and other states (including currentcomplaints or other actions against the Vendor or prior complaints within the past fiveyears),etc.(TheAgencywillworkwithitsAdjustableBlockProgramAdministratoronthespecific scope and format of these submissions after the conclusion of the Plan approvalproceeding.)

BeregisteredtodobusinessinIllinois Disclose to the Agency names and other information on installers and projects, while

otherwisemaintainingconfidentialityofinformation Documentthatallinstallersandothersubcontractorscomplywithapplicablelocal,state,and

federal laws and regulations, including for example, maintaining Distributed GenerationInstallerCertification

ProvidesamplesofanymarketingmaterialsorcontentusedbytheApprovedVendor,and/ortheirsubcontractors/installersandaffiliates,totheAgencyforreview,asrequested.321

AgreetomakechangestomarketingmaterialsasinstructedbytheAgency.322 RegisterinGATSorM‐RETSanddemonstratetheabilitytomanageprojectapplicationand

RECmanagementfunctionsintheapplicabletrackingsystem Payapplicableapplicationfees Provideandmaintaincreditandcollateralrequirements SubmitAnnualReportsonatimelybasis

The Agency intends to open the registration and training process for Approved Vendorsapproximatelytwotothreemonthspriortotheopeningofprograms.

ApprovedVendorswillhavetorenewtheirapprovalonceayear.FailurebyanApprovedVendortofollow the requirements of the Adjustable Block Program could result in the entity having thesuspensionofor losingitsstatusasanApprovedVendorandthuslosingtheabilitytobringnewprojects in to the Programs. Losing that status would not relieve an Approved Vendor of itsobligationstoensurethatRECsfromitsprojectsthathavebeenenergizedcontinuetobedeliveredtotheapplicableutility;failuretodosocouldresultinhavingthevendor’screditcollateraldrawnupon.(SeeSection6.16formorediscussionofcontractualobligations.)

TheAgencyrecognizesthattheremaybecertainprojectswheretheApprovedVendormodelmaynot be completely appropriate, and thereforewill allow an Approved Vendorwho has only oneproject to apply under amore limited set of requirements as a Single ProjectApprovedVendor.Specifically,thisdesignationmayapplytoaprojectthatisownedbythatSingleProjectApprovedVendor (as opposed to a situationwhere the Approved Vendor is an intermediary between thesystem developer and/or owner and the contracting utility). In this situation, the followingprovisionsrelatedtoApprovedVendorswouldnotapply:

321 This requirement applies to atminimum, printedmaterials, advertising through television and radio,websites (including affiliatewebsites),webads,marketingviaemailorsocialmedia,andtelemarketingscripts.322Thisrequirementisnotmeanttoimpedetheabilitytomarkettocustomers,butrathertoensurethatanytypesofmarketingarenotdeceptive,confusing,ormisleading.Likewise,theAgencyisconcernedaboutmisrepresentationsthatcouldbemadeabouttherelationshipbetweenanApprovedVendor(orthesubcontractors/installers)andtheAgencyorprogram.


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ProvidesamplesofanymarketingmaterialsorcontentusedbytheApprovedVendor,and/ortheirsubcontractors/installersandaffiliates,totheAgencyforreview,asrequested.

AgreetomakechangestomarketingmaterialsasinstructedbytheAgency.

Inaddition,therequirementsofSection6.13wouldnotapply,butiftheprojectisacommunitysolarsystem,allapplicablecommunitysolarrequirementsrelatedtosubscriberswouldapply.

SingleProjectApprovedVendorswillneedtorequestthatstatuspriortosubmittingthesystem,andtheProgramAdministratorandAgencywillreviewrequeststoensurethatthisprocessisnotusedto avoid themore general requirements of this program through the establishmentofnominallyseparateentities.TheminimumsizeforaprojectsubmittedbyaSingleProjectApprovedVendorwillbe100kW.

TheAgencywillalsoencourage thehiringofgraduatesof job trainingprograms(asdescribed inSection8.10)toworkoninstallationsofprojectssupportedbytheAdjustableBlockProgram.TheProgramAdministratorwillprovideinformationtoApprovedVendorstosupportthisgoal.

6.10. ProgramAdministratorThe Agency will issue a Request for Qualifications to start the process of selecting a ProgramAdministrator323fortheAdjustableBlockProgram.324TheRequestforQualificationswillbeameanstoselectqualifiedbidderswhowill thenbe invitedtorespondtoaRequest forProposals.325TheAgencywillevaluatethebidsreceivedandwillselectanentity(orentities)toserveastheProgramAdministrator.326TheAgencywillreviewandscoretheRequestforProposalssubmittedbyqualifiedbiddersandwillsubmitthecontractforitsselectedbidtotheCommissionforApproval.TheAgencywill also provide the Commission with information about all bids received. The request forCommissionapprovalwillnotoccuruntilafterthisPlanhasbeenapproved.TheselectionprocessisexpresslyexemptedfromtheIllinoisProcurementCode.327

TheProgramAdministratorwillrunthedaytodayoperationsoftheAdjustableBlockProgram.Thisincludes,butisnotlimitedto:

AssistingtheAgencywithApprovedVendorregistrationandtraining DevelopingaProgramManual Establishing an online portal for Approved Vendors to submit projects (and providing

technicalsupporttoApprovedVendors)andcollectingapplicationfees Maintaininganonlinedashboardtoshowblockstatus Reviewingandapprovingsubmittedbatchesofprojects PreparingcontractsforCommissionreviewandutilityexecution Ongoingmonitoringofprojectdevelopmentstatus

323Section1‐75(c)(1)(M)oftheActauthorizestheAgencyto“retainoneormoreexpertsorexpertconsultingfirmstodevelop,administer,implement,operate,andevaluatetheAdjustableBlockprogram.”324TheRequestforQualificationswillbepostedtotheAgency’swebsite,www.illinois.gov/IPA.325ThisprocessgenerallyfollowstheprocesscontainedinSection1‐75(a)(1)to(5)thattheAgencyhasusedtoselectitsProcurementAdministratorandProcurementPlanningConsultant.326TheAgencyalsoexpectstoissueaseparateRequestforQualifications/RequestforProposalsforadedicatedProgramAdministratororAdministratorsfortheIllinoisSolarforAllProgram.32720ILCS3855/1‐75(C)(1)(M).


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Verifyingcompletionofprojectsand theprocessingofapprovals forpayments,aswellasconductingon‐siteinspectionsforqualityassurancepurposes.

ReviewingAnnualReportssubmittedbyApprovedVendors Providinginformationforthepublicincludingdevelopingaprogrambrand,andmaintaining

an online list of Approved Vendors and educational materials related to distributedgenerationandcommunitysolar

Assistinginworkforcedevelopmenteffortstotheextentfeasible

TheProgramAdministratorwillbeauthorizedtochargefeestoApprovedVendorsasdescribedinSection6.14.4forprocessingapplications.TheProgramAdministratorwilloperateunderacontractwiththeAgencyandmayalsobereimburseddirectlybytheutilitiesforaportionofthecostoftheservicesprovidedtothemincluding,butnotlimitedto,thepreparationofcontractsandreviewofAnnualReports.ProgramAdministratorcosts,otherthanthosecoveredbyfeescollecteddirectlybytheProgramAdministratorfromApprovedVendors,wouldbeconsideredpartoftheadministrativecostsdiscussedinSection3.17.TheProgramAdministratormaynotalsobeanApprovedVendor.

6.11. ProgramLaunchThisPlanisexpectedtobeapprovedbytheCommissionbyearlyApril2018.Shortlythereafter,theAgencywillseekapprovalfromtheCommissionfortheselectionoftheProgramAdministrator.Withthesetwoelementsinplace,implementationofthisPlanwillthencommence.Duetothescopeandcomplexity of the Adjustable Block Program, and the need for the Agency and the ProgramAdministrator todevelopstandardcontracts, aProgramManual, anonlineportal (includingbetatesting),andothertasks,itisreasonabletoassumethatitwilltakeseveralmonthsfortheProgramtolaunch.TheAgencywillworkwiththeProgramAdministratortofindwaystoexpediteprogramopening,ifpossible.UntiltheAgencyhasreceivedbidsfrompotentialProgramAdministrators,itisprematurefortheAgencytocommittoasetscheduleforProgramLaunch.TheAgencywillprovideupdatesonitswebsiteontheexpectedschedulefortheprogramlaunch.

6.12. ProjectRequirementsProjectsthatareeligiblefortheAdjustableBlockProgramwillhavetomeettwosetsofrequirements.Thefirstrelatestothetechnicalaspectsofthesystemitself,andthesecondtothecustomer(andadditionallysubscribers,inthecaseofcommunitysolar).Thepurposeofthefirstsetofrequirementsistoensurethathigh‐qualitysystemsareinstalledthatwillbecapableofgeneratingtheexpectedquantity of RECs over the 15‐year duration of the contracts. The purpose of the second set ofrequirementsistoensureconsumerprotections.

6.12.1. TechnicalSystemRequirementsInthisSectiontheAgencyoutlineswhattechnical informationwillhavetobesubmittedforeachproject.Thesestandardsapplyforbothdistributedgenerationandcommunitysolarprojects.TheapplicationprocessisdescribedinmoredetailinSection6.14.

Thetechnicalsystemrequirementsareasfollows:

Informationaboutthesystemlocation,andsize,includingbutnotlimitedtoo Adescriptionofthetechnicalspecificationsofthemainsystemcomponentsincluding

the make and model, manufacturer, number (quantity) of panels, of panels and


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inverters andmeters, array location (roof or groundmount), tilt, orientation, andshadingpercentage.328

o Sitemaporotherprojectdetails Proofofsitecontroland/orhostacknowledgement Project‐specificestimateofRECproductionduringthe15‐yeardeliverytermusingPVWatts

orasimilartool329 Forsystemsover25kW,asignedInterconnectionAgreement330 Forsystemsover25kW,evidenceofhavingobtainedallnon‐ministerialpermits331 Shadingstudy

For systems thathavebeenenergizedprior to application the following informationwill alsoberequired:

GATSorM‐RETSunitID332 CertificateofCompletionofInterconnection Netmeteringapplicationapprovalletter(ifapplicable) Photographicdocumentationoftheinstallation

TheAgencyrecognizesthattheremaybespecialsituationswheresomeportionofthesedocumentsmaynotbeavailable(forexample,someruralelectriccooperativesandmunicipalutilitiesmaynothavestandardizedinterconnectiondocuments).TheAgencywillbewillingtoconsideralternativedocumentationtodemonstratecompletionofinterconnectioninthosesituations.

6.12.2. MeteringRequirementsIndevelopingmeteringstandardsfortheSupplementalPhotovoltaicProcurementsthattookplacein2015and2016,theAgencydevelopedameteringstandard333thatincluded:

SystemsregisteredinM‐RETSmustutilizeanANSIC.12certifiedrevenuequalitymeter.328EligibleequipmentwillincludeanyequipmentlistedontheGoSolarCaliforniaequipmentlist(see:http://www.gosolarcalifornia.ca.gov/equipment/index.php);otherequipmentwillbereviewedandconsideredonacasebycasebasisandmayrequireadditionaldocumentation.329ActualRECvolumesforasystemwillbebasedoffastandardcapacityfactorasdescribedinSection6.14.5.330WhiletheAdjustableBlockProgramprovidesforseparatecategoriesforsystemsupto10kW,andgreaterthan10kWandupto2,000kW,forthepurposesoftherequirementsrelatedtoeachproject,theAgencyhasdeterminedthat25kWisanappropriatebreakpointbetween different levels for certain requirements. While most residential systems are below 10 kW, the Agency observed from itsSupplementalPhotovoltaicProcurements that therecanbe largerresidentialsystems,particularly inruralareas.25kWisacommonbreakpointusedinprogramsinotherstatesandisthusadoptedbytheAgencyfortheserequirements.331TheAgencyunderstandsthedistinctionbetweenministerialandnon‐ministerialpermitstobeassuggestedbytheMassachusettsnetmeteringprogram(see:http://www.massaca.org/pdf/FAQ.pdf):

“A ministerial permit is a permit that is granted based upon a determination that the request complies with establishedstandards.Suchdeterminationsarearrivedatobjectively,involvelittleornodiscretionaryjudgment,andareusuallyissuedbyasingleofficialorhis/herdesignee. Non‐ministerialpermitsarepermitsinwhichoneormoreofficialsconsider(s)variousfactorsandexercise(s)somediscretionindecidingwhethertoissue(typicallywithconditions)ordenypermits.

Examplesofministerialpermitsinclude,butarenotlimitedtobuildingpermitsandelectricalpermits.

Examples of non‐ministerial permits include, but are not limited to wetlands Order of Conditions, Special Permit, ZoningVariance,EndangeredSpecies,andMEPACertificate.”(TheAgencynotesthatforIllinois,“MEPACertificate”wouldbereplacedbypermitsissuedbytheIllinoisEnvironmentalProtectionAgency.)

332GATSorM‐RETSregistrationmustbecompleteandunitIDverifiablethroughGATSorM‐RETSpublicreports.333See:https://www.illinois.gov/sites/ipa/Documents/IPA‐metering‐accuracy‐standard‐5‐14‐15.pdf.


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Systems over 25 kW registered in GATSmust utilize a newmeter thatmeets ANSI C.12standards.

Systemsover10kWandlessthan25kWinsizeregisteredwithGATSmustutilizeameterthatmeets ANSI C.12 standards.Meters that are refurbished (and certified by themetersupplier)areallowed.

Systemsof10kWinsizeandbelowregisteredwithGATSmustutilizeeitherameterthatisaccurate to +/‐ 5% (including refurbished and certified meters), or an inverter that isspecifiedbythemanufacturertobeaccurateto+/‐5%.TheinvertermustbeUL‐certifiedandmustincludeeitheradigitalorweb‐basedoutputdisplay.

The Agency did not allow production estimates. A production estimate consists of GATSautomaticallygeneratingRECsforasystembasedonthesystemsizeandengineeringmodelingofexpected kilowatt hour generation. Production estimates do not require the system owner (oraggregator)toprovideongoingdatatoGATS.

In responses to the Agency’s Request for Comments, several commenters suggested allowingproductionestimates for smallersystems.Whileseveralstatesdoallowproductionestimates forsmallersystems,becauseproductionestimatesdonotrequireanyactualdatabeingtransmittedtothetrackingsystemtoverifyproduction,thisappearstotheAgencytobeproblematicbecausetherewouldbenowaytoverifythesystem’songoingoperation.Bycontrast,ameterread(fromeitherameter,oraninverteroutput)onlyneedstobesubmittedonceperyeartoGATS.

GiventheupfrontpaymentsforRECspairedwiththe15‐yearrequirementforRECstobedelivered,the Agency believes that getting actual data on system performance is essential to ensuring theintegrityoftheRPS,andhavingmeterreadsasinfrequentasannually(althoughtheycouldbeasfrequently as monthly) appropriately balances the need for accurate data and the complianceburdensonthesystemoperators.334Therefore,theAgencyproposestocontinuetorequiremeteredoutputforthegenerationofRECs.Theuseofinverterreadingsforsystemsupto10kWwillcontinuetobeallowed.335Inotherwords,themeteringstandarddevelopedfortheSupplementalPhotovoltaicProcurementisproposedtobethemeteringstandardfortheAdjustableBlockProgram,withthecaveatthatmeterreadswillonlyberequiredonanannualbasis.

6.13. CustomerInformationRequirements/ConsumerProtectionsInadditiontotheinformationaboutthetechnicalsysteminformationdescribedinSection6.12.1,fordistributed generationprojectsApprovedVendorswill be required to submit information to theAgencyregardingthecustomerhostingthesystemandtheinformationthatwasprovidedtothatcustomer.Thepurposeofrequiringthisinformationistoensureconsumerprotections.Installingaphotovoltaic system is a significant financial commitment on behalf of that system’s host (andpotential owner) and a system that has been sold (or leased) to a customer using incorrect,inaccurate, or deceptive information could put the financial security of Illinois residents orbusinessesatriskandpoisontheongoingviabilityofthesolarmarketinIllinois.Inaddition,aprojectthatsuccessfullyappliestothisprogramstandstoreceiveafinancialbenefitfromtheprogramintheformofaRECdeliverycontractandbyextensionfromtheratepayerswhofundit.Requiringclear

334TheAgencyalsounderstandsthatGATSrequiresanannualreadinginstatesthatuseproductionestimatessothisstandardisinfactfunctionallysimilartotheuseofproductionestimates.335TheAgencynotesthatwhileusinganinverterratherthanametermaysaveoninstallationcosts,iftheinverterweretosufferasystemfailureandlosedata,noRECscouldbecreated.AmetermaybeamorereliablewaytoensureRECcreation.


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andconsistentinformationontherelationshipbetweentheendcustomer,theinstaller/developer,andtheApprovedVendoriscriticaltoensuringthatthefiscalrisksandcontrolsofthisprogramareproperlyandprudentlymanaged.

These requirements are program terms and conditions for participation in a state‐administeredincentiveprogramthatprovidestheopportunityforadditionalprojectrevenuethroughRECdeliverycontracts.Indevelopingtheserequirements,theAgencyrecognizesthatitisnotaregulatoryagencyand does not have jurisdiction over all distributed generation installations or community solarprojectsacrossthestate.Itcan,however,createcommonsenseprovisionstoensurethatentitiesdevelopingprojectsseekingtoparticipateinthisprogramareheldtohighstandardsforconsumerprotection. Ultimately, theAdjustableBlockProgram isa ratepayer fundedprogram intended tobenefitthestate’sresidentsthroughenhancedabilitytoparticipateinthecleanenergyeconomy,andin the Agency’s view, it is essential to ensure that this program produces not only projectdevelopment,butalsoatransparent,positiveexperienceforsystemhostsandsubscribers.

The information thatmust be provided to all customers (and such provision documented to theAgency)includes:

Contracts:Acopyofthecontractforthepowerpurchaseagreement,lease,orsale.Alistofcontract requirements will be developed by the Agency in conjunction with its ProgramAdministrator,andwillbeprovidedtoApprovedVendors.Ataminimum,ApprovedVendorsmayalsousemodelleasesandmodelpowerpurchaseagreements(“PPAs”)providedbytheSolarEnergyIndustriesAssociation(“SEIA”)336,orothercontractsthatmeetrequirementsprovidedbytheAgency.WhiletheAgencywillnotrequirethataspecificcontractformbeutilizedorrequirethesubmittalandapprovalofallcontracts,itretainstherighttorequestcopiesofcontractsfromApprovedVendorsanddevelopnewrequirementsforcontracts.

DisclosureForm:TheAgency,inconjunctionwithitsProgramAdministrator,willdevelopandprovidetoApprovedVendorsstandardDisclosureFormstobecompletedandprovidedtoeachprogramparticipantpriortocontractexecution.Fordistributedgenerationprojects,the form will at minimum, include standard information on the system equipment andcomponents,warranty,installer,andleaseorfinancingstructure.Theformwillalsoincludeastandardizedestimateofthepriceandperformanceofthesystemasinstalled, includinganticipated firstyearproduction, expectedannual systemproductiondecreases, expectedoverall percentage degradation over the life of the system, a standard forecast for retailelectricityprices,anetcashflowanalysis,andatargetrateofreturnofeachproject.Theformwillalsoincludeadisclosurethatcashflowsmaychangeiftheutility’snetmeteringtariffsordistributedgenerationrebateschangepriortothecompletionofthesystem(e.g.,thechangesthatoccurwhennetmeteringenrollmentreaches5%). TheAgencywillprovidestandardelectricityprices (andother inputs) tobeused for theseestimatesas to allowequivalentcomparisonsbetweendifferentoffers.Forcommunitysolarsubscribers,theformwillincludesimilarapplicableprovisionsaswellasconformtotheprovisionslistedinSection7.6.2.337

336SolarEnergyIndustriesAssociation,“ModelLeasesandPPAs,”https://www.seia.org/research‐resources/model‐leases‐and‐ppas.337IntheresponsestotheRequestforCommentsthattheAgencyissuedinJune,2017,severalcommenterssuggestedthattheAgencyconsider adopting the standard disclosure forms developed by the SEIA earlier in 2017 (see: https://www.seia.org/research‐resources/solar‐transaction‐disclosures).Whiletheremaybeaspectsofthoseformsthatareworthconsidering,theAgencyisconcernedthat they do not fully capture the information the Agency believes that potential program participants need to have, in particular,standardizedcomparisonsofenergycosts.Therefore,theAgencywillinsteaddevelopitsowndisclosureformsthatwillcaptureaspectsoftheSEIAdisclosureforms,bestpracticesfromotherstates,aswellasaddressingtheneedtostandardizeenergycostcomparisons.

For a general discussion of challenges related to themarketing of solar and consumer protection policies, see Barbara R.Alexander and Janee Briesemeister, “Solar Power on the Roof and in theNeighborhood: Recommendations for Consumer Protection


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Brochure:TheAgencywillrequireApprovedVendorstodistributetoprogramparticipantspriortotheexecutionofthecontractwiththeprogramparticipant,aconsumerprotectionbrochure in both print and electronic form prepared by the Program Administrator andapprovedbytheAgency.Thatbrochurewillinformconsumersoftheirrights,proceduresforfilingcomplaints,andpointtomoreinformationontheprogramwebsite.

FulldetailswillbeprovidedtovendorswhoapplyforparticipationintheAdjustableBlockProgramortheIllinoisSolarForAllprogram.

Vendorsmustalsoagreetoprovidesalesandmarketinginformation,includedcontractpricesandsalesvolumes,totheAgencyonaconfidentialbasis.TheAgencywillusethisinformationforinternalpurposestotrackmarketprogress.

Additionally,theIPAhasdevelopeditsPlanmindfulofthestate’sexperiencewiththeretailenergysupplymarketandthemarketingandsaleofenergy‐relatedproducts.Assuch,itseekstotapintothe experience and institutional knowledge reflected in the state’s conditions applicable toalternativeretailelectricsuppliers. WhiletheAgencyrecognizes thatApprovedVendorswillnotnecessarilybeAlternativeRetailElectricSuppliers,andthusasApprovedVendorsarenotgovernedasamatteroflawbytheCommission’sRulesapplicabletoARES,itbelievesthattheCommission’sTitle83,Part412rulesprovideaworkableblueprintforexpectationsofApprovedVendors.Thus,asaconditionofongoingapproval,fordistributedgenerationsystemsorcommunitysolarsubscriptionsharesbelow100kwinsize,ApprovedVendorswillbeexpectedtocomplywithmarketingstandardsequivalent to the following sections of Commission‐approved rules for marketing practices byalternativeretailelectricsuppliers.(83Ill.Admin.CodePart412,SubpartB):

412.105(a)‐(c) 412.110(a)‐(i) 412.120 412.130 412.140(a)‐(b),(d) 412.150 412.160(a)‐(b),(d) 412.170 412.180 412.210(applicableonlytocommunitysolar) 412.240(applicableonlytocommunitysolar)

KeyitemsreferencedelsewhereinPart412(includingdisclosureforms,contractassignability,andgreenmarketing)areaddressedseparatelyinthisPlantotheextentapplicabletoApprovedVendors.

6.13.1. CommunitySolarFor community solar projects, the Approved Vendor will have to submit the Technical SystemRequirements information and a copy of the contract between the project developer and theApprovedVendor(iftheyareseparateentities).TheAgencyreservestherighttorequestadditionalinformation about the project structure and financing in order to review project feasibility and

Policies,” March 2016 (http://utilityproject.org/wp‐content/uploads/2016/03/Solar‐Power‐Consumer‐Protection‐Report‐March‐2016.pdf),inparticular,AppendixB.


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contractualarrangementsthatcouldjeopardizeconsumerprotections.Thereareadditionalprogramterms and conditions related to subscribers of community renewable generation projects (bothcommunitysolarandthosethatuseothertechnologies)thatarediscussedinSection7.6.2.

Communitysolarprojectswillnotberequiredtodemonstratethattheyhaveacquiredsubscribersaspartof their initial application.However, asdescribed inSection6.15.4,by the time that suchsystemsareenergized,minimumsubscriberrequirementsmustbemetinordertobeeligibletobepaidforRECs.

TheapplicationforaRECdeliverycontractforacommunitysolarprojectwillrequiretheapplicanttodescribetheproposedsubscriptionmodel(e.g.,typicallengthandstructureofcontract,economicterms,marketingchannels,etc.)andexpectedmixofresidentialandnon‐residentialsubscribers.TheAgency will assess whether the subscription model will reasonably meet program terms andconditionsdescribedinSection7.6andwillusethesubscribermixtodeterminewhatAdder,ifany,willbegiventothesystem,butthefinalAdder(ifany)usedwilldependonthesubscriptionleveldemonstratedoncethesystemisenergized.

6.13.2. MonitoringofConsumerComplaintsTheProgramAdministratorwillprovideconsumerprotectionmaterialsonaprogramwebsiteandthrough printed materials. The Program Administrator will also provide a toll‐free consumerprotectionhotlineandemailaddress,andtheywillreceive,respondto,anddocumentcomplaintsaboutmarketingpractices,salespractices,installations,andotheraspectsofsolarmarketing.

Ifwarranted,theProgramAdministratorwillrefercomplaintstotheAgencyandtoappropriatestateandfederalagencies,includingtheConsumerProtectionDivisionoftheIllinoisAttorneyGeneral’sOffice,ortheIllinoisCommerceCommission(e.g.,forfailureofinstallerstomaintaintheirstatusasCertifiedDistributedGeneration Installers). To theextent feasible, theAgencywillworkwith itsProgram Administrator to maintain a public database of complaints (with any confidential orparticularly sensitive information redacted frompublic entries).ApprovedVendors foundby theAgencytohaveviolatedconsumerprotectionstandardsmaybesubject,atminimum,tosuspensionorrevocationof theirApprovedVendorstatusbytheAgency,andif inviolationof local,state,orfederallaw,alsopotentialcivilorcriminalpenaltiesfromotherrelevantauthorities.

TheAgencywillprovideanannualwrittenreporttotheCommissiondocumentingthefrequencyandnatureofcomplaints,andanyenforcementactionstaken.

6.14. ApplicationProcessThefollowingsectionoutlinestheprocessandprocedurethatApprovedVendorswillusetosubmitprojects to the Program Administrator for review and approval, as well as how projects, onceapproved,willbeplacedintocontractswiththeutilities.

6.14.1. BatchesApprovedVendorswillsubmitprojectsthatarebundledintobatches.Onceapproved,ormodified,eachbatchwillresultinonecontractwithoneutility.Thesystemswithinthebatchwillbelistedonascheduleattachedtothecontractandmaynotbesubstitutedonceapproved.WhileprojectsmaybesubmittedtotheAgencyonanongoingbasis,andgivenpreliminaryapprovalontheprojectlevel,


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final approval and resulting prices will be based upon the time when the batch of projects issubmitted.

Abatchmaycontainprojectsindifferentgroups/blocks(andthuswithdifferentprices)andwithdifferentadders.ThepricefortheRECsforeachsystemwillbebasedonthepriceavailablewithintheapplicableblockonthedateofthesubmittal.Thefailureofanysystemtobedeveloped(andthustheforfeitureofanycollateralassociatedwiththatspecificsystem)willnotimpactanyoftheothersystems on the same schedule, although theAgencywillmonitor system failure rates. ApprovedVendorswithhighfailureratesmayberequiredtoprovideadditionalinformationtotheAgencyforsubsequentapplications.

The ProgramAdministratorwill determinewhich utilitywill serve as the counterparty for eachcontract. While a batch may contain projects in multiple utility service territories, the ProgramAdministratorwillstrivetoassigncontractstotheutilitywherethebulkoftheprojectsarelocated,butmaynot alwaysbe able todo sobecause theProgramAdministratorwill also considerhowassigningcontractstoeachutilitywillalloweachutilitytomeetitspro‐ratashareoftheRPSRECtargets.TheRECpriceforeachsystemwillbebasedonthelocationofthesystemandtheapplicableGroupforthatsystem’sphysicallocation,andnotbasedontheidentityofthecounterpartyutilitytothatcontract.

6.14.2. Systemsbelow25kWInresponsestotheRequestforCommentsthattheAgencyissuedinJune2017,severalcommentersrecommendedthatsystemsunder25kWonlybesubmittedoncetheyarecompletedandenergized,tominimizeadministrativeburdensandavoidprojectattrition.WhiletheAgencyissympathetictothose ideas, this Plan does not adopt that recommendation for several reasons. First, itmay bedifficult, or impossible, tohaveappropriate consumerprotections if theAgency sees informationabout a system only after it is completed. Preventing problematic behavior (such as deceptiveinformation about system costs and payback times) should be done prior to the homeowner orbusinesspayingforthesystem;thatwouldnotbethecaseifsystemsapplyafterbeingenergized.Second,becausetheAgency isrequiringprojects tobesubmitted inbatches, therecouldbea lagbetweenwhenasystemiscompletedandwhentheApprovedVendorhasenoughsystemstosubmitthebatch,whichcouldleadtoadelayinpaymentfortheRECs.Thesystemrequirementsdescribedin Section 6.11 adequately recognize the differences in the project development cycle betweensmallerandlargersystems.

Tobeclear,thereisnothingthatwouldpreventanApprovedVendorfromsubmittinganewsystemthathasalreadybeenenergized(forexample,systemsenergizedafterJune1,2017butpriortothelaunchoftheprogram),buttheApprovedVendorwillhavetoassumetheriskthatthesystemmaynotmeet the required termsand conditionsand couldbe rejectedand thusnotbe included in acontractforthepurchaseofthesystem’sRECs.Asystemthatisrejectedcouldberesubmittedatalaterdateifthedeficienciesarecured,buttheAgencycautionsthatsomedeficienciesmaybedifficultor impossible to cure (particularly when related to ensuring consumer protections from thebeginningoftheproject’slife).

6.14.3. BatchSizeEachbatchmustcontainatleast100kWofproposedprojects,andmaybeaslargeas2MW.Abatchcouldcontainasingle100kWorlargerproject.Toprovideemploymentopportunitiesforminority‐


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owned and female‐owned business enterprises as specified in Section 1‐75(c)(7) of the Act, aminority‐ownedorfemale‐ownedbusinessmayrequesttosubmitaninitialbatchofonly50kW,withanysubsequentbatchessubjecttothestandard100kWrequirement.AnApprovedVendorthatisasmallbusiness338mayalsorequestapproval tosubmitan initialbatchofonly50kW,then futurebatchesof100kW.

Foreachproject,therewillbeanon‐refundableapplicationfeepaidtotheProgramAdministratorortheAgencyof$10perkW,nottoexceed$5,000perproject.This feewillbeusedtooffsettheadministrativecostsofrunningtheprogramandwilldecreasetheadministrativefeesthatwouldotherwisebetakenfromtheutilityRPSbudgets.

6.14.4. BatchReviewTheProgramAdministratorwillreviewtheprojectscontainedinabatchand,asneeded,requestadditionalinformationfromtheApprovedVendorinordertoverifythesubmittedinformationandapprovetheproject.AnApprovedVendorwillbegivenuptotwoweekstocuredeficienciesinanapplication.If,afteranyattemptstocuredeficiencieshasbeenmade,75%ormoreofthekWvolumeinabatchisreviewedandapprovedbytheProgramAdministrator,theProgramAdministratorwillassignthebatch(lessanyprojectsnotapproved)toautility,339preparethecontract,andsubmitittotheCommissionforapproval.Iflessthan75%ofthekWvolumeofabatchisapproved,thebatchwillberejectedinitsentirety.Batcheswillbereviewedintheorderthattheyarereceived.

Systemsthatarereviewedandapprovedbutareinabatchthatisrejectedmaybesubmittedinafuturebatchandwillbesubjecttoanexpeditedreviewprocess.Theapplicationfeeforabatchthatcontains systems that were previously reviewed and approved only needs to be for the newlysubmittedsystemsinthatbatch.

AnApprovedVendorthatrepeatedlysubmitsbatchesthatarerejectedmaybesubjecttohavingitsApprovedVendorstatusreviewed,andpossiblyterminated.

6.14.5. ConvertingSystemSizeintoRECQuantitiesFor each system that is approved, a 15‐year REC payment amount and obligation level will becalculated for that system and that payment amountwill be included in the contract. ApprovedVendorswillhavetheoptionofusingastandardcapacityfactor,orproposinganalternativecapacityfactorbaseduponananalysisconductedusingPVWattsoranequivalenttool.Alternativecapacityfactorsmay be proposed as part of each system’s application andwill be subject to review andapprovalbytheProgramAdministrator.

The calculation for the standard capacity factorwill be based on the following average capacityfactorswhich,asdiscussedbelow,arebaseduponthecapacityfactorusedintheFall2017UtilityDGprocurementandadjustedforanexpecteddegradationrateover15years.

Fixed‐mountsystem16.42%

338AsdefinedintheSmallBusinessAdvisoryAct(20ILCS692/5):“`Smallbusiness’meansanyforprofitentity,independentlyownedandoperated,thatgrosseslessthan$4,000,000peryearorthathas50orfewerfull‐timeemployees.ForthepurposesofthisAct,a`smallbusiness’hasitsprincipalofficeinIllinois.”339ItisunlikelythatabatchwouldneedtobesplitbetweenutilitiesbecauseofRPSbudgetconstraints,butshouldthatoccur,thesplittingofthebatchwouldnotsplitindividualsystems.


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Trackingsystem19.32%

ThesenumbersvaryfromthecapacityfactorusedbytheAgencyfortheSupplementalPhotovoltaicProcurementsandtheUtilityDistributedGenerationProcurementsforthefollowingreasons.

First,priortotheFall2017UtilityDistributedGenerationProcurement,theAgencyusedacapacityfactorof14.38%.ThiscapacityfactorwascalculatedusingaDCrating.PublicAct99‐0906includeda definition of “nameplate capacity,” referring to “the aggregate inverter nameplate capacity inkilowattsAC.”340WiththischangefortheFall2017UtilityDistributedGenerationProcurement,theAgencyupdatedthecapacityfactorstoreflectanACratingandestablishedthemas17%forafixedmountsystemand20%foratrackingsystem.

Second,theSupplementalPhotovoltaicProcurementandtheDistributedGenerationProcurementwereforfive‐yearRECcontracts.Whilephotovoltaicpanelsexperienceannualdegradationintheiroutput,itwasnotfactoredintothecapacityfactorsforthoseprocurements.Giventhe15‐yearRECdeliveryobligationfortheAdjustableBlockProgram,degradationisamoresignificantconcern,andthusa0.5%/yearaverageoutputdegradationfactorwasusedtocalculatethecapacityfactorslistedabove.

Usingthesecapacityfactorswhichhavebeenadjustedbythedegradationrate,forevery1kWofcapacity,approximately21RECswouldbeexpectedtobegeneratedover15yearsforafixed‐mountphotovoltaicsystem.Foratrackingsystem,forevery1kWofcapacity,approximately25RECswouldbeexpectedtobegeneratedover15years.341

6.14.6. BatchContractApprovalTheCommissionmeetsapproximatelyeverytwoweeks.TheProgramAdministratorwillstrivetoefficientlyprocessapprovedbatchesforsubmittaltotheCommission.TheAgencyunderstandsthatCommissionpractice is that items for considerationby theCommissionmustbe submitted tobeplacedonitsopenmeetingagendaatleastoneweekpriortoeachmeeting.

OnceabatchisapprovedbytheCommission,theProgramAdministratorwillforwardthecontractinformation(e.g.,systemsinformation,RECquantities,RECprice,etc.)totheapplicableutilityforthepreparation of contracts for execution. The Approved Vendor will be required also to sign thecontractwithinsevenbusinessdaysofreceivingitfromtheutility.Acollateralrequirementtobeheldbytheutilityequalto5%ofthetotalcontractvaluewillberequiredintheformofeithercashoraletterofcreditwiththeutilitywithin30businessdaysofCommissionapprovalofthecontract.

6.15. ProjectDevelopmentTimelineandExtensions

6.15.1. DevelopmentTimeAllowedOnceacontractforabatchhasbeenexecutedbytheApprovedVendorandtheutility,thenextstepis forprojectsnotyetdevelopedtobedevelopedandenergized.Thesetimesarebaseduponthecontractexecutiondatesothatanydelaysinprocessingandapprovinganapplicationwillnotreducethetimeavailablefordevelopment.

34020ILCS3855/1‐10.341kWsizeistranslatedtoRECsbythefollowingformula:1kW*capacityfactor/1000[kw/MW]*8760[hours/year]*15[years].


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Distributedgenerationprojectswillbegivenoneyeartobedevelopedandenergized. Community solar projects will be given 18 months to be developed, energized, and

demonstratethattheyhavesufficientsubscribers.

Aprojectthatisnotcompletedinthetimeallowed(plusanyextensionsgranted)willbecanceledandremovedfromthescheduleonitscontract,andtheRECvolumeassociatedwiththeprojectwillbeeliminated.TheApprovedVendorwillalsoforfeitthepostedcollateralassociatedwiththeproject.

AprojectthatisnotcompletedintimeandiscanceledmaybesubsequentlyincludedinafuturebatchsubmittedbyanApprovedVendor,butwillbetreatedlikeanyothersystembeingsubmittedinthatnewbatch.

6.15.2. ExtensionsExtensionswillbegrantedforthefollowingcircumstances.

An indefiniteextensionwillbegranted if a system iselectricallycomplete (ready to startgeneration)buttheutilityhasnotapprovedtheinterconnection.TheApprovedVendormustdocumentthattheinterconnectionapprovalrequestwasmadetotheutilitywithin30daysofthesystembeingelectricallycomplete,yetnotprocessedandapproved.

A 6‐month extension will be granted for documented legal delays, including permittingdelays.

A6‐monthextensionwillbegranteduponpaymentofarefundable$25/kWextensionfee,fordistributedgenerationsystems,anduptotwo6monthextensionsforcommunitysolarprojects (the second extension is only for achieving the required subscriber rate, not forprojectcompletionandenergization,andwillrequireanadditionalrefundable$25/kWfee).Theextensionfee(s)wouldbepayabletothecontractingutility,andwouldberefundedaspartofthefirst(oronlyforsystemsupto10kW)RECpayment.

TheAgencymayalso,butisnotrequiredto,approveadditionalextensionsfordemonstrationofgoodcause.

6.15.3. ProjectCompletionandEnergizationTheApprovedVendorwillprovidetheProgramAdministratorwithastatusupdateoneachprojectthatisunderdevelopmentbutnotyetenergizedatleasteverysixmonthsandwillinformtheAgencyofanysignificantchangestothesystem.342Forcommunitysolarprojects,theupdatewillincludeanupdateonthestatusofacquiringsubscribers.TheAgencyandProgramAdministratorwillprovideastandardizedform(includingstandardstatuscategoriestosimplifyreporting)forthispurpose.

Onceaprojectisenergized,thefollowinginformationwillberequiredtoapprovethefinalprojectandauthorizethestartofpaymentforRECs.

Finalsystemsize Finalsystemspecificcapacityfactorand15yearRECproductionestimate GATSorM‐RETSunitID343

342Forsystemsunder25kWthestatusupdatewouldonlyberequiredforasystemwherethereisachangeinstatus(e.g.,aprojectbeingcompleted,orcanceled).343GATSorM‐RETSregistrationmustbecompleteandunitIDverifiablethroughGATSorM‐RETSpublicreports.


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CertificateofCompletionofInterconnectionorcomparabledocumentation344 Netmeteringapplicationapprovalletter(ifapplicable) Photographicdocumentationoftheinstallation Disclosureofanychangestothesystemtechnicalspecificationsthatoccurredbetweenthe

initialapplicationandthecompletionoftheproject

Ifthefinalsystemsizeislargerthantheproposedsystemsizesuchthatitwouldcausethesystemtochangefromtheupto‐10kWtotheover‐10kWcategory,thepaymenttermswillbeadjustedfromthefullpaymentonenergizationto20%onenergizationandthebalanceoverthenextfouryears.ThepriceperRECwillalsobechangedtotheapplicableRECpricefortheover10kWcategoryineffectatthetimewhenthesystemisenergized.

Forsystemsover10kW,anyaddersreceivedwillbebasedonthefinalsystemsizeifthatfinalsystemsizewouldcausetheadderstodecrease.Asystemthatisdevelopedatasizesmallerthantheoriginalapplicationwillnotbeeligibleforadditionaladders.

ThequantityofRECsusedforthecalculationofthepaymentforRECswillbebasedonthelesseroftheRECscalculatedbasedontheproposedsystemsizeandcapacityfactor,andtheRECscalculatedbasedonthefinalsystemsizeandcapacityfactor. Inthisway,asystemthat isbuiltsmallerthanplannedwillnotbenefitfromexcessRECpaymentsthatcouldresultfrompurposefullysubmittingtheprojectatalargersizethanreallyintended.Ontheoppositeside,ifaproject’sfinalsystemsizeissignificantly larger than the planned system size, an increase in the payment due could presentunexpectedbudgetmanagementchallenges.AnApprovedVendorwouldhavetheoptionofcancelingandresubmittingasystemifthefinalsizeislargerthantheproposedsysteminordertoaligntheRECquantitiesorifitdesirestohavethesystemchangefromadistributedgenerationprojecttoacommunitysolarproject,orviceversa.However,theresubmittalwillbeatthepriceoftheBlockopenatthetime,nottheoriginalsubmittal.AnewapplicationfeewillberequiredbecausetheAgencywillneedtoreviewthesystemdesignwhichwouldbedifferentfromwhatwasoriginallysubmitted(e.g.,becauseofthechangeinsystemsize).Ifaprojectisresubmitted,thecollateralassociatedwiththeoriginalsystemwouldbeappliedtotheresubmittedsystem,ifapproved.

TheAgencywillreservetherighttorequestmoreinformationonaninstallation,and/orconducton‐siteinspections/auditsofprojectstoverifythequalityoftheinstallationandconformancewiththeproject information submitted to the Agency. Projects found not to conform with applicableinstallation standardsand requirements, orprojects foundnot tobe consistentwith informationprovidedto theAgencywillbesubject toremoval fromtheprogramif thedeficienciescannotberemedied.Likewise,ApprovedVendorswhorepeatedlysubmitprojectsthathavetheseproblemsmaybesubjecttolosingtheirApprovedVendorstatus.

6.15.4. AdditionalRequirementsforCommunitySolarProjectsAcommunitysolarprojectwillhavetodemonstratethatithasmetaminimumsubscriptionleveltobeconsideredenergizedandeligibletoreceivepaymentforRECs.Atleast50%ofthecapacityoftheprojectmustbesubscribedatthetimeofenergizationinordertoreceivepaymentforRECs,andthatpaymentwillbebaseduponcalculatingthenumberofRECsthatcorrespondwiththeamountoftheproject’scapacitythathasbeeninitiallysubscribed.TheApprovedVendorwillreportsubscription

344ComparabledocumentationwouldonlyapplyforaruralelectriccooperativeormunicipalutilitythatdoesnotprovideaCertificateofCompletionofInterconnection.


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levelsonaquarterlybasisduringthefirstyear.ThecalculationofthenumberofRECsforpaymentwillbeupdatedafteroneyearofoperation(basedonthefinalquarterlyreportofthatfirstyear)toallow for the acquisition of additional subscribers. A community solar project may request oneadditionalextension(withanon‐refundableextensionpaymentasprovidedforinSection6.15.2)toitsenergizeddateifitneedsadditionaltimetoacquiresubscribers.

ThecalculationofthemaximumnumberofRECsduepaymentwillbedeterminedbytheproject’ssubscriptionlevelafteroneyearofoperation(andwillbesubjecttothemaintenanceofsubscriptionlevelsasdescribedinSection6.17).Forexample,ifaprojectisexpectedtoproduce1,000REC/yearandafteroneyearofoperationis95%subscribed(onaprojectcapacitybasis),thentheannualRECproductionvalueusedforthecontractpaymentlevelwouldbe950RECs.UndertheRECdeliverycontract, theApprovedVendorwould thenbeobligated todeliver to theutility95%of theRECsproducedby that systemeachyear. Theownership (and any subsequent transfer or sale) of theremaining5%ofRECswouldbeoutsideofthecontract.

Theaddersforsmallsubscriberparticipation(i.e.,foraminimumof25%,50%,or75%ofenergysales)willonlybeadded(onaproratedbasis)totheRECpriceiftheprojectdemonstratesthatlevelofparticipationforthesubscribedamountatthetimeofenergization.Ifthesubscriptionlevelhasnotbeenmetbythetimeofenergization,theadderwillbeheldbackfromtheinitialpaymentandthesystemwillhavetowaituntilithasbeeninoperationforonequartertodemonstratethatithasbegun tomeet thesmall subscriberparticipation level tobegin toreceive thisadder. If thesmallsubscribersubscriptionrate ismet, thenthe fullvalueof theadderwillbeaddedpro‐rata to theremainingpayments.

Ifacommunitysolarprojectfailstoattractsufficientsubscribersbythetimeofenergization,butalsomeetsthedefinitionofadistributedgenerationproject(i.e.,islocatedon‐site,behindacustomer’smeter,andusedprimarilytooffsetasinglecustomer’sload),itmayrequesttoberecategorizedasadistributedgenerationprojectandreceiveaRECpaymentatthelesseroftheoriginalpriceandthepriceofthedistributedgenerationblockopenatthetimethisdeterminationismade.AcommunitysolarprojectthatdoesnotmeetthedefinitionofadistributedgenerationprojectthatfailstoattractsubscriberswillnotbeeligibleforthisoptionandwouldnotbeeligibleforRECpayments.Likewise,aproposeddistributedgeneration systemmayswitch tobeinga community solarprojectbeforeenergization and receive the REC price of the currently open community solar block, and anyappropriateadders.Inbothofthesesituationsaprojectmayonlyswitchonetime.

Ongoing requirements for overall subscription levels and small subscriber participation arediscussedfurtherinSection6.16.

6.15.5. RECDeliveryOnceasystemisenergized,itwillberequiredtobeginRECdelivery.Forsystemslargerthan5kW,thefirstRECmustbedeliveredwithin90daysofwhenthesystemisenergizedandregisteredinGATSorM‐RETS.Forsystemssmallerthan5kW,180dayswillbeallowed.The15‐yeardeliverytermwillbegininthemonthfollowingthefirstRECdeliveryandwilllast180months.


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ApprovedVendorswillberequiredtosetupanirrevocable15yearStandingOrderforthetransferofRECsfromthesystemtotheutility.345AstheAgencyunderstandsthatautomatictransferscanonlybeterminatedwiththeassentofbothparties,thiswillreducetherisktotheutilitythattheRECscouldbesoldtoanotherpartyaftertheutilityhaspaidforthem.

Aspartof theAnnualReportdiscussed in Section6.17, theApprovedVendorwill report onanysystemsthathavenotdeliveredafirstREC,andreportonanysystemsthathavenotdeliveredRECsformorethanayearfromtheirpreviousdelivery.Thereportwillalsodetailwhatcorrectiveactionswillbetaken.IntheeventoffailuretoremedytheRECsnotbeingdelivered,theutilitywillhavetheabilitytocallontheongoingperformancecollateralitholdsfromtheApprovedVendor.

6.16. OngoingPerformanceRequirementsAsignificantchallengefortheAdjustableBlockProgramisthatthepaymentforRECsisfrontloaded;allRECsarepaidforonenergizationforsystemsupto10kW,andallpaymentsforsystemsover10kWwillbemadewithinthefirstfouryearsofenergizationforthelargersystems.YetthecontractsforRECdeliveryhavea15‐yearobligationfortheRECstobedelivered.Thiscreatesasituationinwhich, absent any additional measures, the buyer (the utility) will be unable to use the typicalcontractual tool of withholding payments for the good not yet received to ensure REC delivery.Fortunately,theActanticipatedthisissueandrequiresthat“[e]achcontractshallincludeprovisionstoensurethedeliveryoftherenewableenergycreditsforthefulltermofthecontract.”346

The Agency proposes the following approach to ensure REC delivery over the full term of thecontracts.Thisapproachwill alsoensurepropermatchingof adders forphotovoltaic communityrenewablegenerationprojectsatdifferentlevelsofresidentialsubscriptionlevels.

RECdeliveryobligationswillbemanagedataportfoliolevel.Asprojectsarecompletedandbecomeenergized, each Approved Vendor will therefore have a portfolio of systems with REC deliveryobligations from thevarious contracts that it haswitheachutility.Theobligation to ensureRECdeliverywillbeatthecontractlevelratherthantheindividualprojectlevel.Inthisway,thenaturalvariationthatsomesystemswillproducemoreRECsthanforecastandothersfewerRECswillreducetheriskofcontractdefault,comparedtoproject‐levelcontracts,andallowforsomeeaseincontractadministration.

6.16.1. CreditRequirementsAnApprovedVendorisrequiredtopostcollateralequivalentto5%ofthetotalcontractvaluewheneachBatch’scontractisapproved.TheApprovedVendormaychoosefortheutilitytowithholdthecollateralamountforeachsystemfromthelastRECpaymentforthesystem(oronlyRECpaymentforsmallsystems)inexchangefornotneedingtomaintaintheongoingcollateralrequirement.Inthissituation,thecollateralwouldbereducedasdescribedbelow,andfullyreturnedattheendofthe contract (net anyamounts thatweredrawn tomeet contractualobligations).As systemsareenergized,thiscollateralamount(ordeferredpayment)willbemaintainedthroughthelifeofthecontract, and can be reduced in the later years of the contract when the collateral requirement

345SeeSection10.2oftheGATSOperatingRulesavailableathttps://www.pjm‐eis.com/~/media/pjm‐eis/documents/gats‐operating‐rules.ashx.34620ILCS3855/1‐75(c)(1)(L)(iv).


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exceedstheremainingvalueof thecontract.Thisrequirementwillbemaintainedat theportfoliolevel,nottheindividualcontractorsystemlevel.

By maintaining collateral requirements at the portfolio level, the Agency is allowing ApprovedVendorstomanagetheriskthatsomesystemsmayunderperform(orhaveotherproblems),andotherswillnot,orevenoverperform.Thisallowsthecollateralleveltobelowerthanitwouldbeifmaintainedatthesystemlevel.

Nonetheless, an Approved Vendor will be responsible for delivering RECs each year under itscontracts(subjecttothereductionoptionsdescribedinthefollowingSection).Onanannualbasis,failuretodeliverRECsforthepreviousyearwillresultintheutilitydrawingonthecollateraltobecompensatedfortheundeliveredRECsfromthatyearthatalreadyreceivedpayment.AfteranysuchdrawingtheApprovedVendorwillneedtorestoreitscollateralleveltobringitbackuptothe5%ofremainingvalueof theportfoliowithin90days. If theamountofcollateralheld foranApprovedVendor is insufficienttocompensate theutility, theApprovedVendorwillberequiredtopaytheutilityforthebalanceofthevalueoftheundeliveredRECsfromthatpreviousyear.Failuretomakepaymentand/ormaintainthecollateralrequirementwillresultintheApprovedVendor’ssuspensionfromparticipatingintheProgram.

ReconciliationofRECdeliveriesandcollateralrequirementswillbeconductedonanannualbasisbasedontheAnnualReportsfiledbytheApprovedVendorsasdescribedinSection6.17.

6.16.2. OptionstoReduceRECDeliveryObligationsSection1‐75(c)(1)(L)of theIPAActprovidesthat“[t]heelectricutilityshallreceiveandretireallrenewableenergycreditsgeneratedbytheprojectforthefirst15yearsofoperation.”347Thecapacityfactor asdescribed inSection6.14.5willbeused to calculate thenumberof expectedRECseachsystemgenerates,andthustheoverallpaymentforthatsystem.IfasystemproducesmoreRECsthanexpectedfromthatcalculation,thennoadjustmentwouldbemadetopaymentsortothestatutorilymandated 15‐yearREC delivery term.However, if the systemproduces fewer than the expectednumberofRECs,thenthefollowingconditionswouldapply.

The Agency expects each Approved Vendor to take the steps necessary to ensure that projectscontained within its portfolio meet all expected REC deliveries. This may include working withsystemownerstoensurethatongoingmaintenanceandrepairsofsystemsoccursaswellastoensurethat meter/inverter data is properly transferred to GATS or M‐RETS for the creation of RECs.Furthermore,ApprovedVendorswillberesponsibleforensuringtheongoingtransferofRECstotheapplicableutility.However,becauseweatherandotherfactorsmayimpactannualproductionvalues,RECdeliveryperformancewillbeevaluatedonathree‐yearrolling‐averagebasis.

Thereare circumstanceswherea systemmaynotbeable todeliver theRECs itwasexpected toproduce;theAgencybelievesthatreasonableaccommodationsshouldbemadeforthesesituationsthatappropriatelybalancetherequirementsfortheutilitiestocomplywithRPStargetsandtheirexpectationtoreceiveRECsforwhichpaymenthasalreadybeenmadewhileacknowledgingthatunexpectedsituationsmayariseatnofaultoftheApprovedVendor.

Inforcemajeuretypecircumstances(including,butnotlimitedto,physicaldamagetothesystemfromfires,tornados,etc.)theApprovedVendormayrequesttohaveadeliveryobligationsuspended,34720ILCS3855/1‐75(c)(1)(L)(ii).


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reduced,oreliminatedwithoutpenalty.348ApprovaloftherequestwillrequireconsensusbetweentheAgencyandtheapplicableutility.Curtailmentsbyeithertheutility(includingthosethroughasmartinverter)ortheRTOthatresultinreducedRECproductionwouldbeconsideredaneventthatallowsforreducedRECdeliveryobligations.

Inthecaseofreductionsoreliminationsofdeliveryobligations,theApprovedVendorwillneedtodemonstratewhatmeasureshavebeentakenthatdonotadequatelycurethesituation(suchasfilingand receiving an insurance claim that is inadequate to restore the system to operation). For thesuspensionofdeliveryobligations,theApprovedVendorwillneedtodemonstratethatreasonablemeasures are being taken to have a timely restoration of production. Approved suspension ofdeliveryobligationswillchangetheenddateforthe15‐yearRECdeliverytimelinetoreflectthetimethedeliveryobligationsweresuspended.

AnApprovedVendormayalsodeterminethatasystemisnotperformingatthelevelexpected.Inthiscircumstance,theApprovedVendormayrequesttohavethedeliveryobligationrelatedtothatsystemwithinitsportfolioreducedinexchangeforthereturntotheutilityofapaymentadjustmenttoaccountforallundeliveredRECsattheoriginaldeliverylevelasofthetimeoftherequest.

6.17. AnnualReportOnanannualbasis,eachApprovedVendorwillsubmitanAnnualReportofthecontractsandsystemsinitsportfolio.349TheAnnualReportwillserveasthebasisforverifyingthatRECsfromprojectsarebeing delivered to the applicable utility, and, absent corrective actions taken by the ApprovedVendor, will be used to determine what actions should be taken by the utilities to enforce thecontractualrequirementsthatRECsaredelivered,including,butnotlimitedto,drawingoncollateral.Additionally,theAnnualReportwillbeusedbytheAgencytoconsidertheongoingeligibilityofanApprovedVendortocontinueparticipationintheprogram.

Fordistributedgenerationsystems,thereportwillincludeinformationon:

RECsdeliveredbyeachofthesystemsintheportfolio Statusofallsystemsthathavebeenapproved,butnotyetenergized,includinganyextensions

requestedandgranted EnergizedsystemsthathavenotdeliveredRECsintheyear Balanceofcollateralheldbyeachutility AsummaryofrequestsforRECobligationsreductionsduetoforcemajeureevents AsummaryofrequestsforRECobligations,suspensions,reductions,oreliminationsdueto

forcemajeureevents Informationonconsumercomplaintsreceived Otherinformationrelatedtoongoingprogramparticipation

Forcommunitysolarprojectsthereportwillalsoinclude:

Percentageofeachsystemsubscribedonacapacitybasis

348Specificcircumstancesthatconstituteforcemajeurewillbeoutlinedincontractdevelopmentprocess.349ApprovedVendorsmayrequestconfidentialtreatmentoftheAnnualReport.However,aggregatedinformationfromAnnualReportsmaybepubliclydisclosedbytheAgencytotheextentthatitdoesnotdiscloseApprovedVendor‐specificconfidentialinformation.


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The number and type of subscribers (e.g., residential, small commercial, largecommercial/industrial),includingcapacityallocatedtoeachtype

Subscriberturn‐overrates

The Agency will review the annual reports to assess compliance with the requirements of theAdjustableBlockProgram and, if there are shortfalls ofRECdeliveries or subscription levels forphotovoltaiccommunityrenewablegenerationprojects,willcoordinatewiththeapplicableutilityonwhatremediesshouldbetaken,includingdrawingoncollateral.350

For community solarprojects, subscription levelsmustbemaintained to remain eligible forRECpayments.Iftheannualreportshowsthatsubscriberlevelshavefallenbelow50%ofthesystems’capacityonarollingaveragebasis,thenifRECpaymentsarestilldue,thosepaymentswillbereducedasdescribedearlierinthischapter;ifallpaymentshavebeenmade,thentheAgencywillworkwiththeapplicableutilityonwhatremediesshouldbetakenincludingdrawingoncollateral.

Asimilarreviewwillbeconductedforprojectsthathavereceivedasmallsubscriberparticipationadder but do notmaintain sufficient levels of small subscriber participation. If small subscriberparticipationlevelsarenotmaintainedandthereareremainingRECpaymentsdue,thosepaymentswillbereduced(toeithertheactualsmallsubscriberaddercategorythathasbeenmaintained,ortoremovetheadderaltogetherifthelevelfallsbelow25%).Ifallpaymentshavebeenmade,thentheAgencywillworkwiththeapplicableutilityonwhatremediesshouldbetakenincludingdrawingoncollateral.

ApprovedVendorswillbegiven90daystocureanydeficienciesfoundbytheAgencyand/orutilities.

350TheAgencywillrequestonasemi‐annualbasisareportfromeachutilityonRECsdeliveredbycontract.


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7. CommunityRenewableGenerationProjectsCommunity Renewable Generation is a relatively new concept in Illinois. It is intended to allowconsumerstoparticipateinrenewableenergygenerationeveniftheyareunabletohaveanon‐sitesystemattheirhomeorbusiness,andtoofferamoredirectconnectiontothebenefitsofrenewableenergythansigningupforarenewableenergyretailsupplyofferfromanAlternativeRetailElectricSupplier(whereinformationaboutthespecificsources,costsandbenefitsoftherenewableenergyandtheunderlyinggeneratingsystem(s)maynotbereadilyavailable).

Community, or “shared,” renewable energy is growingnationally,most often in conjunctionwithsolarpower.CommunitySolarHubcountsover100projectsin26states,manyledbyruralelectriccooperatives.351 Illinoishas at least two community solarprojects already, built for rural electriccooperatives.

Manypolicy issuesthathavebeendebatedinotherstatesareresolvedinIllinoisthroughtheActitself, including elements of project size, ownership structures, and the number and type ofsubscribers. In this Chapter, the Agency outlines the terms and conditions for the CommunityRenewableGenerationProgramthatarenotprescribedbytheAct.

7.1. StatutoryOverviewThe Act contains several key provisions designed to make community renewable generationeconomically viable and practical in Illinois. These provisions create a program, provide it withimportantstructure,andincreasethebenefitstoparticipantsthroughchangestonetmeteringandbillcreditingandtheabilitytomonetizethevalueofRECsfromthesystems.

Section1‐10containsseveralkeydefinitions:

"Communityrenewablegenerationproject"meansanelectricgeneratingfacilitythat:

(1) ispoweredbywind, solar thermalenergy,photovoltaiccellsorpanels,biodiesel,crops and untreated and unadulterated organic waste biomass, tree waste, andhydropower that does not involve new construction or significant expansion ofhydropowerdams;

(2)isinterconnectedatthedistributionsystemlevelofanelectricutilityasdefinedinthisSection,amunicipalutilityasdefinedinthisSectionthatownsoroperateselectricdistributionfacilities,apublicutilityasdefinedinSection3‐105ofthePublicUtilitiesAct,oranelectriccooperative,asdefinedinSection3‐119ofthePublicUtilitiesAct;

(3) credits thevalueofelectricitygeneratedby the facility to the subscribersof thefacility;and

(4)islimitedinnameplatecapacitytolessthanorequalto2,000kilowatts.

"Subscriber"meansapersonwho(i)takesdeliveryservicefromanelectricutility,and(ii)hasasubscriptionofnolessthan200wattstoacommunityrenewablegenerationprojectthatislocatedintheelectricutility'sservicearea.Nosubscriber'ssubscriptionsmay totalmore than 40% of the nameplate capacity of an individual community

351CommunitySolarHub,https://www.communitysolarhub.com.AccessedSeptember1,2017.


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renewablegenerationproject.Entitiesthatareaffiliatedbyvirtueofacommonparentshallnotrepresentmultiplesubscriptionsthattotalmorethan40%ofthenameplatecapacityofanindividualcommunityrenewablegenerationproject.

"Subscription" means an interest in a community renewable generation projectexpressedinkilowatts,whichissizedprimarilytooffsetpartorallofthesubscriber'selectricityusage.

These three definitions create the core of the idea of community renewable generation, wheresubscriberspay forsharesorsomeother“interest” inacentralized(butsmall)renewablepowerproject,receivingbillcreditsinexchange.ItcanbeseenasawayofgivingcustomerschoicesabouttheirelectricitygenerationinamannerthatcanserveasanalternativetotheoptionscreatedbytheestablishmentofretailchoicethroughtheElectricServiceCustomerChoiceandRateReliefLawof1997.352

Section1‐75(c)(1)(N)createsthecommunityrenewablegenerationprogram:

(N)Thelong‐termrenewableresourcesprocurementplanrequiredbythissubsection(c) shall include a community renewable generation program. The Agency shallestablishtheterms,conditions,andprogramrequirementsforcommunityrenewablegenerationprojectswithagoaltoexpandrenewableenergygeneratingfacilityaccesstoabroadergroupofenergyconsumers,toensurerobustparticipationopportunitiesforresidentialandsmallcommercialcustomersandthosewhocannotinstallrenewableenergy on their own properties. Any plan approved by the Commission shall allowsubscriptions to community renewable generation projects to be portable andtransferable. For purposes of this subparagraph (N), "portable" means thatsubscriptionsmay be retained by the subscriber even if the subscriber relocates orchangesitsaddresswithinthesameutilityserviceterritory;and"transferable"meansthatasubscribermayassignorsellsubscriptionstoanotherpersonwithinthesameutilityserviceterritory.

Electricutilitiesshallprovideamonetarycredit toasubscriber'ssubsequentbill forservice for the proportional output of a community renewable generation projectattributabletothatsubscriberasspecifiedinSection16‐107.5ofthePublicUtilitiesAct.

The Agency shall purchase renewable energy credits from subscribed shares ofphotovoltaiccommunityrenewablegenerationprojectsthroughtheAdjustableBlockprogramdescribed insubparagraph(K)ofthisparagraph(1)orthroughtheIllinoisSolar forAllProgramdescribed inSection1‐56of thisAct.The electricutility shallpurchaseanyunsubscribedenergyfromcommunityrenewablegenerationprojectsthatare Qualifying Facilities ("QF") under the electric utility's tariff for purchasing theoutputfromQFsunderPublicUtilitiesRegulatoryPoliciesActof1978.Theownersofand any subscribers to a community renewable generation project shall not beconsideredpublicutilitiesoralternative retail electricity suppliersunder thePublic

352OneaspectofthesuccessofretailcompetitioninIllinoishasbeenmunicipalaggregationprogramswherebyamunicipalitynegotiatesanelectricsupplyofferfromanARESonanopt‐outbasisforeligibleretailcustomers.TheAgencyunderstandsthatthosecustomerswhoparticipateinamunicipalaggregationprogramremainindividualcustomersandthuswouldbeconsideredindividuallyforthepurposesofthe40%caponindividualsubscriptions.Theaggregatorwouldnotbeconsideredasubscribertoacommunityrenewablegenerationproject.


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Utilities Act solely as a result of their interest in or subscription to a communityrenewablegenerationprojectandshallnotberequiredtobecomeanalternativeretailelectricsupplierbyparticipatinginacommunityrenewablegenerationprojectwithapublicutility.

This Chapter describes the “terms, conditions, and program requirements” and how RECs arepurchased. Certain other aspects of the program requirements are requirements that areadministered by the applicable utility, and the Agency will coordinate with them to ensurecompliancewiththeAct.

While theActdefines community renewable energy as including solar,wind, biomass, andotherrenewable sources, it creates an Adjustable Block Program only for photovoltaic generation,directingtheAgencyto“purchaserenewableenergycreditsfromsubscribedshares”ofcommunitysolarprojects.353ByprocuringtheirRECs,theAgencyisabletoofferanadditionalfinancialincentiveforcustomerschoosingcommunitysolar.

Subscriberscapturethevalueoftheircommunityenergysubscriptionintheformofa“monetarycredit”appliedtothesubscriber’ssubsequentutilitybillforservice,inproportiontothenetoutputoftheirsubscriptiontotheproject.ThedeterminationofthatcreditisnotthesubjectofthisPlan,and is established through tariffs filedby theutilitieswith the IllinoisCommerceCommissionasdiscussed furtherbelow. Instead, theAgency’srole issimply in theprocurementofRECs. Whilesubscribersmaynot(iftheirsubscriptiondoesnottaketheformofequityintheproject)necessarilydirectlyreceiverevenuefortheRECsprocuredfortheutilitiesbytheAgency,thatrevenueshouldfactorintotheeconomicsfacedbytheprojectdeveloperandimpactthesubscriptionoffermadetosubscribers.

ThemonetarycreditsfornetenergyproductionflowfromnewlyavailableprovisionsofthePublicUtilities Act that expand the concept of net metering, which had previously been available fordistributedgeneration,tobecomeavailableforcommunityrenewablegenerationsubscribers.ThepreviousversionofSection16‐107.5(l)ofthePublicUtilitiesActbeforetheenactmentofPublicAct99‐0906providedthatelectricutilitiesmerely“shallconsider”whethertoallowcommunity‐ownedfacilitiesormeteraggregationprojectsinasinglebuilding.TherevisedversionofthatSectionaddsthe requirement to Section 16‐107.5 that utilities shall allow354 net metering for subscribers to“communityrenewablegenerationprojects,”aswellastheothertwotypesofcommunityrenewableprojects.

The new law requires an “electricity provider” (meaning an electric utility or alternative retailelectric supplier) to provide net metering credits for a community solar subscriber’s share of aproject’snetelectricityproductionatthesubscriber’senergysupplyrate.355

PublicAct99‐0906alsorequiredthateachelectricutilityfileacommunitysolarnetmeteringtariffby90daysafterthenewlaw’seffectivedateofJune1,2017.EachofComEd,AmerenIllinois,and

353Asdiscussedelsewhere,theAgencyunderstands“purchase”effectivelytomean“procure”asusedinthisprovision,astheAgencywouldnotdirectlyenterintocontractswithrenewableproviders.354220ILCS5/16‐107.5(l)(1).355Communitysolarprojectsaretoreceiveenergy‐onlynetmeteringcreditsstartingfromtheenactmentofPublicAct99‐0906onJune1,2017(orwhenevereachelectricityproviderimplementsthetariffortermstodosofollowingJune1,2017),incontrasttoothertypesofdistributedgeneration,whichwill continue to receive full retail ratenetmetering from June1,2017until totalnetmetering for thatelectricityproviderreaches5%oftheelectricityprovider’speakdemand,asdiscussedinChapter6.


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MidAmericanfiledaproposedtariffduringAugustof2017,andtheCommissionapprovedallthreetariffsonSeptember27,2017.356ThesetariffsarediscussedfurtherinSection7.7ofthisPlan.

ComEd’s new tariff consisted of modifications to its Rider POGCS (Parallel Operation of RetailCustomer Generating Facilities Community Supply), Rider POG (Parallel Operation of RetailCustomerGeneratingFacilities),RiderPORCB(PurchaseofReceivableswithConsolidatedBilling),andRateRESS(RetailElectricSupplyService).Ameren’snewtariffconsistedofacompleterevisiontoitsRiderNM(NetMetering)tonowincorporateprovisionsgoverningcommunityrenewablenetmetering. MidAmerican’s new tariff created a new Rate NMS to embody its new communityrenewablenetmeteringprogram.

7.2. EligibleGeneratingTechnologiesandProcurement/ProgramEligibilityCommunityrenewablegenerationprojectsthatarephotovoltaicwillbeeligibletoparticipateintheAdjustableBlockProgramoutlinedinChapter6.Othertypesofcommunityrenewablegenerationprojects(thelistingforwhichcanbefoundinthedefinitionof“renewableenergyresources”foundinSection1‐10oftheIPAAct)willbeeligibletoparticipateinthecompetitiveprocurementoutlinedinChapter5.Theseoptionsdefinetheprocessbywhichasystemwouldcomeundercontractwithautility to sell its RECs, and each option features different payment terms. The Adjustable BlockProgramhasfront‐loadedRECpayments,whilecompetitiveprocurementswillpayforRECsastheyaredelivered.Otherthanthesecontractualdifferences,theAgencybelievesallcommunityrenewablegeneration projects (including those participating in the Adjustable Block Program) should betreated the sameas to other terms and conditions that follow in thisChapter, unless specificallynoted.

Fornon‐photovoltaiccommunityrenewablegenerationprojects,thepriceperRECtheywillbepaidwillbebaseduponthepriceofthewinningbidder’sbidinthecompetitiveprocurementandisnottiedtoanyaddersorrequirementsforresidentialsubscriptionrates.

7.3. Co‐locationofProjectsCo‐locationiswhenmultipleprojectsarelocatedadjacenttoeachother,perhapsusingthesamegridinterconnection.Co‐locatedprojectscanbestructuredtomaximizeincomefromincentives,suchasbydividingupa largerproject intosmallerpieces thatqualify forhigher incentives. CommunityRenewableGenerationProjectsaredefinedintheActasbeingsmallerthanorequalto2,000kW,andforphotovoltaicprojects, theAdjustableBlockProgramincludesadders forsmallerprojects. Co‐locationstrategiescouldthereforeresultinthegamingofprices.

Minnesotaofferstwopointsofexperiencewiththeissueofco‐location,forbothcommunitywindandcommunitysolar. Underbothpolicies, largerprojectswerestructuredasaseriesofsmallerprojectstoqualifyforhigherincentives,underminingthelegislativeintentofpromotingdistributed,community‐ownedprojects.A30MWwindproject,ownedby15corporateentitieswiththesameowners,wasdevelopedundertheMinnesotaCommunity‐BasedEnergyDevelopment(C‐BED)tariffprogram,whichwasintendedtoencouragecommunity‐ownedwindprojectsof2MWorless.That

356SeeICCDocketNo.17‐0350(ComEd),ICCDocketNo.17‐0368(MidAmerican),andICCtariffno.ERM17‐144(AmerenIllinois).


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programwasreformedin2003tobemoreprescriptive,limitingownershiptoMinnesotaresidents,withasingleownerlimitedtoa15%shareofaproject.357

ThemorerecentMinnesotaCommunitySolarGardenspolicy ledtoasimilarproblem. Whilethelegislature cappedproject size at 1MW, it didnot address co‐location issues.As a result, 15 co‐located,aggregatedprojectswereproposedbetween10and20MW,threebetween20and30MW,andtwointhe30to50MWrange.Onedeveloper,SunriseEnergyVentures,filedapplicationsfor100projectswithinthefirsthouroftheprogram.WhenthestatePublicUtilitiesCommission(“PUC”)imposedco‐locationcapsof5MWforprojectswithfiledapplicationsand1MWfornewlyproposedprojects,SunriseappealedtotheMinnesotaCourtofAppeals.TheCourt,however,affirmedthePUC’sdecisiontoimplementcaps.358

Whileco‐locationcanunderminetheconceptofsmallerandmoregeographicallydiffuseprojects,itcan also capture economies of scale from larger projects: large, available parcels with goodinterconnectionpointscanbelow‐costandefficientwaystodeveloplargeamountsofrenewablesquickly. Lowdevelopment costs could help compensate for the highermarketing and customeracquisitioncostsofcommunityrenewablegeneration,andprovidegreaterbenefitstolow‐incomecustomers. Also,differentownersmightapplytodevelopcompletelydistinctprojectsatdifferenttimes,thatjusthappentobeonadjacentparcels;restrictiveruleswouldlimitthedevelopmentofespeciallyattractiveparcelsofland.

7.3.1. Co‐locationStandardInenactingPublicAct99‐0906,theGeneralAssemblyexpresslyincludedasizelimitforcommunityrenewablegenerationprojectsof2,000kW,359andtheAgencydoesnotbelieveitshouldignoretheintentofthatsizelimitbeingincludedinthedefinitionofcommunityrenewablegenerationprojects.Additionally,asdiscussedinSection6.5.1,theAgencyseekstoavoidthesituationinwhichmultiplesmallerprojectsareco‐locatedinordertoobtainthehigherRECpricesavailabletosmallersystems.

Toappropriatelybalancethesecompetingissues,andinrecognitionofaneedtoavoidproblemsofthetypesseeninMinnesota,theAgencyproposesthefollowingco‐locationpolicy.360

Foreachparcelofland(asdefinedbytheCountytheparcelislocatedin),nomorethan2MWofcommunityrenewablegenerationmaybeinstalled.

o Aparceloflandmaynothavebeendividedintomultipleparcelsinthetwoyearspriortotheprojectapplication(fortheAdjustableBlockProgram),orbid(forcompetitiveprocurements)inordertocircumventthispolicy.Ifaparcelhasbeendividedwithin

357JessicaA.ShoemakerandChristyAndersonBrekken,Farmers’LegalActionGroup,CommunityWind:AReviewofSelectStateandFederalPolicyIncentives,August2006,http://www.flaginc.org/wp‐content/uploads/2013/03/CommWindAug061.pdf.358MitchellWilliams,SeligGates&WoodyardPLLC,“CommunitySolarGardens:MinnesotaAppellateCourtAllowsPublicUtilityCommissiontoImplementCapsonUsage,”Lexology,August23,2016.http://www.lexology.com/library/detail.aspx?g=c4690835‐61c4‐40cf‐8105‐0cc8d3229c77.359See20ILCS3855/1‐10("’Communityrenewablegenerationproject’meansanelectricgeneratingfacilitythat...islimitedinnameplatecapacitytolessthanorequalto2,000kilowatts.”).360TheseprinciplesarederivedfromthedefinitionadoptedinMinnesotaregardingco‐location.See,MinnesotaPUC,IntheMatterofthePetitionofNorthernStatesPowerCompany,dbaXcelEnergy, forApprovalof ItsProposedCommunitySolarGardenProgram.OrderAdoptingPartialSettlementAsModified.August6,2015.DocketNo.E‐002/M‐13‐867.

https://www.edockets.state.mn.us/EFiling/edockets/searchDocuments.do?method=showPoup&documentId={43AC9E59‐AD57‐44FE‐A57A‐5F8A572D3C74}&documentTitle=20158‐113077‐01.


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thattimeperiod,therequirementwillapplytotheboundariesofthelargerparcelpriortoitsdivision.

Iftherearemultipleprojectsownedordevelopedbyasingleentity(oritsaffiliates)locatedononeparcelofland,oroncontiguousparcelsofland,anysize‐basedadderswillbebasedonthetotalsizeoftheprojectsownedordevelopedonthecontiguousparcelsbythatsingleentityoritsaffiliates.Furthermore,thetotalcombinedsizeofprojectsownedordevelopedbyasingleentity(oritsaffiliates)oncontiguousparcelsoflandmaynotbemorethan2MW.

o “Affiliate” means, with respect to any entity, any other entity that, directly, orindirectlythroughoneormoreintermediaries,controls,iscontrolledby,orisundercommoncontrolwitheachotherorathirdentity.“Control”meansthepossession,directlyorindirectly,ofthepowertodirectthemanagementandpoliciesofanentity,whether through the ownership of voting securities, by contract, or otherwise.Affiliatesmaynothavesharedsalesorrevenue‐sharingarrangements,orcommondebtandequityfinancingarrangements.

o “Contiguous” means touching along a boundary or a point. For example, parcelstouchingalongaboundaryarecontiguous,asareparcelsthatmeetonlyatacorner.Parcels,howeverneartoeachother,thatareseparatedbyathirdparcelanddonottouchalongaboundaryorapointarenotcontiguous.

Projectsownedordevelopedbyseparateentities(meaningthatthattheyarenotaffiliates)may be located on contiguous parcels. If there is a naturally good location from aninterconnectionstandpoint,oneownershouldnotbeallowedtopreventanotherownerfromdevelopingaprojectinthatlocation.

Projectsmusthaveseparateinterconnectionpoints.

7.4. Eligibility ofProjects Located inRural Electric Cooperatives andMunicipalUtilities

The definition of community renewable generation projects specifically mentions rural electriccooperatives andmunicipal utilities,361 but does not explicitly include or exclude them from anyprogramorprocurementtoberunbytheAgency.Moreover,thedefinitionincludestheconceptofthatprojecthaving“subscribers,”atermwhichinturnhasadefinitionthatdefinessuch“subscribers”as“tak[ing]deliveryservicefromanelectricutility,”whichasdefinedintheIPAActdoesnotincludecooperative and municipal utilities.362 This results in ambiguity around whether a communityrenewable generation project can be located within the service territory of a rural electriccooperativeoramunicipalutility.Ultimately,theAgencyrecognizestheGeneralAssembly’schoiceexpresslytoincludethoseentitiesindefining“communityrenewablegenerationprojects”—atermonly used in the IPA Act in connection with the Agency’s community renewable generationprogram—andbelievesthatcommunityrenewablegenerationprojects(includingcommunitysolar)locatedintheseserviceterritoriesshould,ifpossible,beincludedinthisPlan.

361See20ILCS3855/1‐10("’Communityrenewablegenerationproject’meansanelectricgeneratingfacilitythatis...interconnectedatthedistributionsystemlevelofanelectricutilityasdefined in thisSection,amunicipalutilityasdefined in thisSectionthatownsoroperateselectricdistributionfacilities,apublicutilityasdefinedinSection3‐105ofthePublicUtilitiesAct,oranelectriccooperative,asdefinedinSection3‐119ofthePublicUtilitiesAct”).362Specifically,Section1‐10oftheIPAActdefinesanelectricutilityashaving“thesamedefinitionasfoundinSection16‐102ofthePublicUtilitiesAct,”whichis“apublicutility,asdefinedinSection3‐105ofthisAct,thathasafranchise,license,permitorrighttofurnishorsellelectricity toretail customerswithinaservicearea.” 220 ILCS5/16‐102. Section3‐105of thePUA in turndefines “publicutility” toexpressly exclude “public utilities that are owned and operated by any political subdivision, public institution of higher education ormunicipalcorporationofthisState,orpublicutilitiesthatareownedbysuchpoliticalsubdivision,publicinstitutionofhighereducation,ormunicipalcorporationandoperatedbyanyofitslesseesoroperatingagents”aswellas“electriccooperativesasdefinedinSection3‐119”ofthePUA.220ILCS5/3‐105.


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Asmentionedabove, therearealreadyat least twocommunitysolarofferings fromruralelectriccooperatives.Illinois’firstcommunitysolarprojectwasa126kWinstallationinElizabeth,builtbyJoCarrollEnergyinDecember2014.363ThatprojectallowsJoCarrollcustomerstobuyindividualpanelsinthe460‐panelground‐mountedsystem,withtheenergyproducedcreditedagainsttheirbills.PrairiePowersellskWhblocksofsolarpowertocustomersofits10distributioncooperativesthrough the Bright Options Solar program. The program is supplied by two 500 kW solarinstallationsnearShelbyvilleandAstoria,bothbuiltin2015.364NeitheroftheseprojectswouldbeeligibletoparticipateintheAdjustableBlockProgrambecausetheywereenergizedpriortoJune1,2017,buttheyindicatethatruralelectriccooperativeshavethusfarbeentheleadersincommunitysolarinIllinois.

TheAgencyproposesthefollowingstandardforallowingcommunityrenewablegenerationprojectsintheserviceterritoriesofruralelectriccooperativesandmunicipalutilitiestoparticipateintheAgency’s programsorprocurements.These standardsmay require actionsbe takenby the ruralelectriccooperativeormunicipalutility.Asentitiesnotregulatedbythestate,theyarefreetochoosetotaketheseactionsordeclinetotaketheseactions,butshouldtheychoosenotto,thentheresidentsandbusinesseswithin theirservice territorieswouldnotbenefit fromreceivingrevenue throughtheseprograms for itsRECs,and thus theeconomicsofsuchprojectsmaynotbeasattractive todevelopersorsubscribers.

TherequirementsforparticipationthattheAgencyrecommendsforaruralelectriccooperativeormunicipalutilityfollowfromthoserequiredintheActforelectricutilities:

Becapableof“credit[ing]thevalueofelectricitygeneratedbythefacilitytothesubscribersof the facility.”365 This can be accomplished though offering “virtual net metering”substantiallysimilartotheprovisionscontainedinSection16‐107.5(l)ofthePublicUtilitiesAct.366“Thevalueofelectricitycreditedmustbeatno lower than thesubscriber’s supplyrate.367

Provideamonetarycredittoasubscriber'ssubsequentbillforservicefortheproportionaloutputofacommunityrenewablegenerationprojectattributabletothatsubscriber.”368

“PurchaseanyunsubscribedenergyfromcommunityrenewablegenerationprojectsthatareQualifyingFacilities("QF")undertheelectricutility'stariffforpurchasingtheoutputfromQFsunderPublicUtilitiesRegulatoryPoliciesActof1978.”369

PriortoaphotovoltaiccommunityrenewablegenerationprojectapplyingfortheAdjustableBlockProgram,oracommunityrenewablegenerationprojectpoweredbyotherrenewabletechnologiesparticipatinginthecompetitiveprocurement,theApprovedVendorshallobtainacertificationtotheAgency that the rural electric cooperativeormunicipalutilityhasmet these conditions from the

363JoCarrollEnergy,https://jocarroll.com/content/south‐view‐solar‐farm.364PrairiePower,https://www.ppi.coop/brightoptions.365Seedefinitionof“CommunityRenewableGenerationFacility”in20ILCS3855/1‐10.366See220ILCS5/16‐107.5(l).367Ifthemunicipalutilityorruralelectriccooperativedoesnothaveunbundledrates(e.g.,separatelineitemsfordeliveryservicesandelectricitysupply)thentheapplicablemunicipalutilityorruralelectriccooperativemustindicatetheportionofthebundledratethatreasonablycorrelatestothecostofelectricitysupplyservice.368See20ILCS3855/1‐75(c)(1)(N).369Seeid.


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subject cooperative ormunicipal utility. Absent this information, a project located in the serviceterritoryofthatruralelectriccooperativeormunicipalutilitywillnotbeallowedtoparticipate.Alltheotherprogrammaticrequirementsforcommunityrenewablegenerationprojects(e.g.,sizelimits,co‐location,consumerprotections)wouldapplytoprojectslocatedinruralelectriccooperativesormunicipal utility service territories. For the purposes of rural electric cooperatives, theserequirementsapplyatthedistributioncooperativelevel,ratherthanforgenerationandtransmissioncooperatives(whichdonotdirectlyinteractwithretailcustomers).

7.5. TypesofCommunityRenewableGenerationProjectsCommunity Renewable Generation remains a new concept for Illinois, and is still developingnationally.Practitionersarestilldevelopingthemostviablebusinessmodels,andnewmodelsarelikelytoemerge,bothfor‐profitandnon‐profit.Insomemodels,customerstakeownershipofashareofacommunityproject,identifyingspecificsolarpanels.Inothers,thedeveloperownstheprojectandsellssubscriptionsforacontractuallyobligatedterm,oranindefinitetermthatcanbeendedatwill. Thevalueofthegenerationcanbeconveyedtothecustomerbyvirtualnetmetering(asanenergycredit),byavalue‐of‐solartariff,orasapremiumpurchase.

One issue that the Agency has considered is the extent to which projects will be proposed bycommercialdeveloperswhothenseektoidentifysubscribers,andbycommunity‐ledprojectswhereinterestedpartiesinacommunitycometogethertoseektodevelopaproject.Achurchparish,forexample, could put photovoltaic panels on the roof of the church, with subscriptions sold toparishioners.Developer‐ledprojectsarelikelytobelargerandlocatedwhereinterconnectioncostsareminimized,whilecommunity‐ledprojectslikethechurchparishcouldbesmallerandfacethepossibilityofhigherinterconnectioncostsbecausethelocationisdeterminedbycommunity‐focusedinterestsratherthanpureengineeringconsiderations.

While such community‐ledprojects seemconsistentwith the intentof theAct, theAgency isnotproposingaspecificadderforcommunity‐ledprojectsatthistime.Thereareseveralreasonsforthis.First,theAgencyhasproposedAddersthatshouldencouragecommunity‐ledprojectslikethechurchparishexample,suchasforsmallersizedsystemsandforalargerportionofresidentialsubscribers.Second,properlydefiningwhatistrulyacommunity‐ledprojectcouldbeproblematicandsubjecttogaming. It is possible, for example, that community groups will team with professional solardeveloperstorealizetheirprojects,withvaryingownershipstructures.

Inadditionto theaddersavailable throughtheAdjustableBlockProgram,certaincommunity‐ledprojectsmayinsteadparticipatein,andbeeligibleforahigherlevelofincentivesthrough,theIllinoisSolar for All Program as described in Chapter 8. Developers of Community Solar projects thatparticipateinthatprogramarerequiredto“identifyitspartnershipwithcommunitystakeholdersregarding the location,development,andparticipation in theproject,provided thatnothingshallprecludeaprojectfromincludingananchortenantthatdoesnotqualifyaslow‐income.Incentivesshouldalsobeofferedtocommunitysolarprojectsthatare100%low‐incomesubscriberowned,which includes low‐income households, not‐for‐profit organizations, and affordable housingowners.”370Becauseaprojectdoesnothavetorelyexclusivelyonlow‐incomesubscribers(althoughadditionalincentivesareavailableforprojectsthatdoso)thisoptionmaybringanadditionalvalueoptiontocommunity‐ledprojects.

37020ILCS3855/1‐56(b)(2)(B).


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Itcouldalsobehardtoascertainifaprojectwasreallyproposedbyacommunity,orifadeveloperproposed the project and found community organizations to represent the project,whichwouldclearlynotbetheintendedoutcomeofa“community”adder.WhileasimilarchallengeexistsforthecommunitysolarprojectsthatparticipateintheIllinoisSolarforAllPrograminthattheyrequirecommunityparticipation,thatprogramalsofeaturestherequirementthateconomicbenefitsflowtothe(low‐income)participants,whichcanhelpmitigatethisconcern.

7.6. SubscriberRequirementsWithcommunityrenewablegenerationstillanemergingconcept,thelevelofconsumerinterestandthemostviablebusinessmodelsremaintobedetermined.TheAgencyseekstoallowcreativityandflexibilityindevelopingprojectswhileatthesametimeensuringbasicconsumerprotections.

7.6.1. SmallSubscriberParticipationTheActrequires that theAgencyproposetermsandconditions that“ensurerobustparticipationopportunities for residential and small commercial customers and those who cannot installrenewable energyon theirownproperties.”371Collectively theAgency considers “residential andsmallcommercialcustomers,”tobe“smallsubscribers”solongastheirsubscriptionsizeisbelow25kW.IntheresponsestotheRequestforCommentsissuedbytheAgencyafteritsMayworkshops,therewerestrongdisagreementsexpressedabouthowthisprovisionshouldbeinterpreted.Someparties argued that it meant that all projects must include some level of residential or smallcommercialparticipation,whileothersarguedthattheappropriateaddersorotherincentiveswouldleadtorobustparticipationandthatthereshouldbenorequirement.

WhiletheAgencyappreciatestheargumentsmadebythosewhowouldwishtorequireresidentialorsmallcommercialparticipation inallprojects, theAgencydeclines toadopt thatproposal.Theabove‐quoted language of the Act refers to “robust participation opportunities”372 for smallcustomers,anddoesnotmandaterobustparticipation.

Instead,asdescribedinSection6.5,theuseofAddersintheAdjustableBlockProgramrecognizesthevalue of small subscriber subscriptions, and the Agency expects that this will be a sufficientmechanism to ensure robust participation opportunities for small subscribers. The Agency willreview the actual level of small subscribers achievedby initial community renewablegenerationprojectsandwilluse that reviewandanyotheravailable informationaspartof thePlanUpdateconducted in2019andwill consider revising thisdetermination if residentialparticipation rates(measuredincapacity)areinaggregateunder25%.

Thelevelofinterestincommunityrenewablegenerationisstillunknown,anditispossiblethattheinterestanduptakeofsubscriptionsmaybestrongerfromlargercommercialcustomers.Nationally,corporate customers have emerged as major buyers of renewable energy in order to meetsustainabilityandfinancialgoals.Illinoisishometomanycorporationsthathavemadesustainabilitycommitments,whichmayconstituteasignificantmarketforcommunityrenewablegeneration.

Ifitturnsoutthattheinterestfrompotentialsmallsubscribersincommunityrenewablegenerationislimited,requiringsmallsubscriberparticipationcouldimpedethesuccessfuldevelopmentofthecommercial community renewable generationmarket. As the Agency considers small subscriber37120ILCS3855/1‐75(c)(1)(N).372Emphasisadded.


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participationlevelsinthefuture,considerationoftheissuewillincludebothresultsinIllinoisaswellasfromotherjurisdictions.

7.6.2. MarketingtoSmallSubscribersSubscribingtoacommunityrenewablegenerationprojectisnotthesameaschoosingtopurchaseorleaseasystemtobelocatedonyourownproperty.Itdoes,however,bearsimilaritiestosigninguptotakesupplyservicefromanAlternativeRetailElectricSupplier.TheAgencyobservesthatthehistoryofquestionablemarketingpracticesofsomeAlternativeRetailElectricSuppliersgivesreasontobeconcernedaboutthemarketingofcommunityrenewablegenerationsubscriptions.373

While competition in the natural gas and electricity markets has createdmany benefits for theresidentsandbusinessesofIllinois, thosebenefitshavenotbeenuniform,andinmanyinstances,particularlyinresidentialmarkets,thebenefitshavebeennon‐existent;infact,attimessupplyoffershave been harmful to consumers. This Plan is not the place to have a full debate on acceptablemarketingpractices,buttheAgencywouldliketohighlightpastpracticesthatsomealternativegasandelectricsuppliershaveengagedinthatcauseconcernfortheAgency.Theseincludeimproperlyassociatingthesupplierwiththelocalutilityoragovernmentagencyorprogram;implyingthatacustomermust choose to enroll; inflating the price of green energy offers far beyond the actualincrementalcostofprocuringrenewableresources;andtargetingelderly,non‐Englishspeaking,andlowincomecustomerswhomayhavelessaccesstoqualityinformationaboutenergyprices.

TheAgencyrecognizes that itmaynotbeable toprohibitdoor todooror telemarketingsalesofcommunity renewable generation subscriptions, but notes those marketing channels as ones ofparticular concern because of the information asymmetry between the salesperson and theconsumer.TheAgencybelievesaninformedconsumerisawiseconsumerandstronglyencouragesmarketing channels that respect the opportunity for consumers to have complete and accurateinformationaboutthedecisionstheymaymakeregardingsubscriptions,particularlythoserelatedtoupfrontpayments,thenetpriceofenergy,andterminationfeesandconditions.TheAgencyand/oritsProgramAdministratormayconductadditionalmonitoringofApprovedVendors(and/ortheirpartners/affiliates)thatutilizedoortodoorortelemarketingsales,andreservestherighttorequesttheApprovedVendorprovideadditionaldocumentationofthosemarketingchannelsincluding,butnotlimitedto,accesstocallcenterrecordingsforeithersalesorthird‐partyverifications.

Thatbeingsaid,thereareanumberofstateandfederalconsumerprotectionlaws,regulations,andenforcementagenciesthatapplytoallformsofmarketing,includingmarketingofsubscriptionstoCommunityRenewableGenerationProjects.374

373See,e.g.,ICCDocketNo.14‐0512,ConsumerServicesDivisionandOfficeofRetailMarketDevelopmentStaffReporttotheCommissiondated August 20, 2014, https://www.icc.illinois.gov/downloads/public/edocket/384622.pdf (detailing misleading and noncompliantmarketingtacticsemployedbyoneARES);ICCDocketNo.15‐0438,ConsumerServicesDivisionandOfficeofRetailMarketDevelopmentStaffReporttotheCommissiondatedJuly20,2015,https://www.icc.illinois.gov/docket/files.aspx?no=15‐0438&docId=232481(detailingseveralmisleadingtelephonemarketingtacticsemployedbyadifferentARES);ICCDocketNo.15‐0512,FirstNoticeOrder,September22,2016, at 55 (expressly relying on information submitted with the ICC Staff Initial Comments dated November 5, 2015(https://www.icc.illinois.gov/downloads/public/edocket/417068.pdf), which detailed trends in allegations of ARES wrongdoingincluding unauthorized switching, misrepresentation of the nature of the transaction, misrepresentation of identity of the ARES,misrepresentationofpriceorsavings,failuretodisclosecancellationfeesorrighttocancel,andmore);ICCDocketNo.17‐0273,Order,August15,2017,at4‐5(denyingacertificateofserviceauthoritytoanARESthat,previouslyoperatinginIllinoisunderapriorcorporatestructure,hadamassednumerouscomplaintsrelatedtosalesandmarketing).374DianaChaceandNateHausman,CleanEnergyStatesAlliance,ConsumerProtectionforCommunitySolar:AGuideforStates,June8,2017.http://cesa.org/resource‐library/resource/consumer‐protection‐for‐community‐solar‐a‐guide‐for‐states.


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Table7‐1:FederalStatutesthatApplytoCommunitySolar

Statute TopicCAN‐SPAMAct ElectronicmarketingConsumerLeasingAct LeasingdisclosuresElectronicFundsTransferAct ConsumerrightsinelectronicfundtransfersEqualCreditOpportunityAct DiscriminationincredittransactionsFairCreditReportingAct CollectionanduseofconsumerinformationFederalTradeCommissionAct UnfairanddeceptivetradepracticesMagnuson‐MossWarrantyAct ConsumerproductwarrantiesRighttoFinancialPrivacyAct FinancialprivacyfromgovernmentintrusionTruthinLendingAct LendingdisclosuresandstandardizationTelephoneConsumerProtectionAct TelemarketingandautomatedtelephoneequipmentUnfairDeceptivePracticesAct(UDAAP) MisleadingfinancialproductsandservicesUniformCommercialCode Salesandcommercialtransactions

Source:CESA,ConsumerProtectionforCommunitySolar:AGuideforStates,2017.

Table7‐2:IllinoisStatutesthatApplytoCommunitySolar

Statute TopicConsumerFraudandDeceptiveBusinessPracticesAct(815ILCS505)

Enrollment,marketing,billing,andcollectionbyelectricserviceproviders

ElectronicMailAct(EMA)(815ILCS511) Regulatese‐mailsolicitations

TelephoneSolicitationsAct(815ILCS413)andtheRestrictedCallRegistryAct(815ILCS402)

Regulatestelemarketingpractices

PersonalInformationProtectionAct(815ILCS530)

Requirescompaniesthatcollectpersonalinformationtotakereasonablemeasurestoprotectitandreportunauthorizedaccesstoconsumer’spersonalinformation.

Theselawsandregulationsprovideastartingpointforprotectingconsumers,buttheirenforcementagenciestypicallyonlytrackandenforceviolationsiftriggeredbyconsumercomplaints.Inordertoensure that subscribersarewell‐informedand thusaffordedadequateconsumerprotections, theAgencywillrequirethatallprojectsadheretothefollowingtermsandconditionsforsubscriptions.

Drawing fromtheconsumerprotectionguidelines forcommunitysolaradoptedby theMarylandPublic Service Commission, the Agency proposes to require that Approved Vendors (or theirsubcontractors)seekingRECdeliverycontractsassociatedwithCommunityRenewableGenerationFacilitiesparticipatingintheAdjustableBlockProgramorinIllinoisSolarforAllmustincludeeachofthefollowinginanycontractsenteredintowithsubscribers:


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(a)Aplainlanguagedisclosureofthesubscription,including:(i)Thetermsunderwhichthepricingwillbecalculatedoverthelifeofthecontractandagoodfaithestimateofthesubscriptionpriceexpressedasamonthlyrateoronaperkilowatt‐hourbasis;(ii)Whetheranychargesmayincreaseduringthecourseofservice,and,ifso,howmuchadvancenoticeisprovidedtothesubscriber.

(b)Contractprovisionsregulatingthedispositionortransferofasubscription,aswellasthecostsorpotentialcostsassociatedwithsuchadispositionortransfer;(c)Allnonrecurring(one‐time)charges;(d)Allrecurring(monthly,yearly)charges;(e) A statement of contract duration, including the initial time period and any rolloverprovision;(f)Termsandconditionsforearlytermination,including:

(i)AnypenaltiesthattheProjectDevelopermaychargetothesubscriber;and(ii)Theprocessforunsubscribingandanyassociatedcosts.

(g)Ifasecuritydepositisrequired:(i)Theamountofthesecuritydeposit;(ii)Adescriptionofwhenandunderwhatcircumstancesthesecuritydepositwillbereturned;(iii)Adescriptionofhowthesecuritydepositmaybeused;and(iv)Adescriptionofhowthesecuritydepositwillbeprotected.

(h)Adescriptionofanyfeeorchargeandthecircumstancesunderwhichacustomermayincurafeeorcharge;(i)AstatementexplaininganyconditionsunderwhichtheProjectDevelopermayterminatethecontractearly,including:

(i)CircumstancesunderwhichearlycancellationbytheProjectDevelopermayoccur;(ii)Manner inwhich the Project Developer shall notify the customer of the earlycancellationofthecontract;(iii)Durationofthenoticeperiodbeforeearlycancellation;and(iv)Remediesavailabletothecustomerifearlycancellationoccurs;

(j)Astatementthatthecustomermayterminatethecontractearly,including:(i)Amountofanyearlycancellationfee;

(k)Astatementdescribingcontractrenewalprocedures,ifany;(l)Adisputeprocedure;(m)TheAgency’sandCommission’sphonenumberandInternetaddress;(n)Abillingproceduredescription;(o)ThedataprivacypoliciesoftheProjectDeveloper;(p)Adescriptionofanycompensationtobepaidforunderperformance;(q)Evidenceofinsurance;(r)Adescriptionoftheproject’slong‐termmaintenanceplan;(s)Currentproductionprojectionsandadescriptionof themethodologyused todevelopproductionprojections;(t)ContactinformationfortheProjectDeveloperforquestionsandcomplaints;(u) A statement that the Project Developer and utility do not make representations orwarrantiesconcerningthetaximplicationsofanybillcreditsprovidedtothesubscriber;


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(v)Themethodofprovidingnoticetothesubscriberswhentheprojectisoutofserviceformorethanthreebusinessdays,includingnoticeof:

(i)Theestimateddurationoftheoutage;and(ii)Theestimatedproductionthatwillbelostduetotheoutage.

(w)Anyothertermsandconditionsofservice.Asreferencedabove,theAgencyanditsProcurementAdministratorwillalsobedevelopingStandardDisclosureFormsforuseinthemarketingofcommunityrenewablegenerationprojectsubscriptions.Inaddition,toensureportabilityandtransferabilityofsubscriptioncontracts,asrequiredbySection1‐75(c)(1)(N)of theAct, anysuchcontract shouldprovide that thesubscriber (i)mayretain thesubscriptionaslongasthesubscriberchangesaddressesforutilityservicewithinthesameutilityserviceterritory,and(ii)mayassignorsellthesubscriptiontoanotherpersonwithinthesameutilityserviceterritory,withoutanyfeeowedtothesubscriptioncounterparty.TheAgencyunderstandsthatthecommunityrenewablenetmeteringtariffs forAmerenIllinois,ComEd,andMidAmericanapprovedbytheCommissiononSeptember27,2017areconsistentwiththeseprinciples.

7.6.3. MarketingClaimsRelatedtotheOwnershipofRECsandCommunityRenewableGenerationSubscriptions

TheAgency’sAdjustableBlockProgramforcommunitysolar,andthecompetitiveprocurementforotherformsofcommunityrenewablegeneration,arebothbasedonthecorerequirementthatthevalue to the project developer (and in turn the ability to make a financially attractive offer tosubscribers)isbaseduponthesaleoftheproject’senvironmentalattributes(intheformofRECs)fromtheprojecttoautility.ThoseRECsarethenretiredbytheutilitytomeettheannualRPSgoalsofthatutility,andtheoriginalRECholder’sclaimstothoseenvironmentalattributesareeffectivelyextinguishedthroughthatsale.

Thisraisestheissueofwhatmarketingclaimsmaybemaderelatedtoasubscriptioninacommunityrenewable generation project receiving a REC contract (including community solar projectsparticipating in the Adjustable Block Program), as such projects will have already contractuallycommitted the sale of their environmental attributes to a third party. With the underlying“renewable”or“solar”elementofthatgenerationhavingbeendecoupledandsoldtotheutility,canitstillbemarketedasa“communitysolar”project?Moreover,canthesubscribermakeanyclaimsforanycommercialpurposeaboutany “green” (orsimilar)aspectofhisorherenergysourcing?GuidancefromtheFederalTradeCommissionwouldappeartolimitwhatclaimscanbemadeaboutenergy sourced from projects whose RECs are transferred to another entity.375 The guidancesuggeststhatappropriatedisclaimersaboutthefateoftheRECsmaysatisfyrulesagainstdeceptivemarketing.Yet,atsomepoint,theissuebeginstoborderontheabsurd:alengthyfactualexplanationofacommunitysolarsubscriptionandthisAgency’svariousRPSprogramswouldbepermissible,butashorthanddescriptionusedtomarketthatsubscriptionmaybelegallyproblematic.

While theAgencyrecognizes that it isnot theFederalTradeCommission (or thestate’sOfficeofAttorney General) and thus cannot provide reliable guidance onwhatmarketing claimsmay bepermissible, the Agency can play an important role in ensuring that any potential subscribers

375See16C.F.R.§260.15(d),Example5;seealsoU.S.EPA,“MakingEnvironmentalClaims,”https://www.epa.gov/greenpower/making‐environmental‐claims.


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understandthevalueofacommunitysolarsubscription—evenifmoredirectstatementscannotbemadeabouttheenvironmentalattributesoftheunderlyingenergy.Tothisend,theAgencyproposestoworkwithitsProgramAdministratoronthedevelopmentofa“brand”associatedwithAdjustableBlock Program participation. This “brand,” and associated content (including public‐facingwebcontent) would allow potential subscribers to a community solar project to understand thatsubscriptionstosuchaprojecthelpthestatemeetitsrenewableenergygoalsandmaysupportthedevelopmentofanewgeneratingfacility—butwithoutriskingtheprojectdeveloperitselfmakingfalseormisleadingclaimsabout“renewable”or“clean”energy.TheAgencyplanstoworkcloselywithrepresentativesofthecommunitysolarindustry,thestate’sOfficeoftheAttorneyGeneral,theStaffoftheIllinoisCommerceCommission,andotherpartiesindevelopingthisapproachandanyassociatedcontent.

7.7. UtilityResponsibilitiesWhile theAgency, through theAdjustableBlock Program and competitive procurements,will beresponsiblefortheprocurementofRECsfromcommunityrenewablegenerationprojects,itisnotresponsible for all aspects of a successful program. There are several additional key aspects ofmakingcommunityrenewablegenerationprojectssuccessfulthatfalloutsideofthecontroloftheAgency.

Thecreditingofthevalueofenergythroughnetmetering Ensuringtheportabilityandtransferabilityofsubscriptionswithinautilityserviceterritory.

TheAgencywillworkwiththesystemownersanddevelopersaswellastheutilities(andwithruralelectriccooperativesandmunicipalutilitiesshouldtheychoosetoparticipate)incoordinatingtheserequirementswiththeterms,conditions,andoperationalaspectsoftheprogramsandprocurementsconducted by the Agency. The Agency will also coordinate with the utilities on the data andinformationthateachpartycollectsandmaintainsregardingprojectsandsubscriptions.

PublicAct99‐0906requiredeachelectricutilitytofileatariffwithin90daysaftertheAct’seffectivedate,June1,2017,toimplementnetmeteringforcommunityrenewableprojects.376Allthreeutilitiesdidso.

ComEd’scommunityrenewablegenerationnetmeteringtariffwasapprovedbytheCommissioninDocketNo.17‐0350onSeptember27,2017.TheCommissionresolvedadisputeamongtheCompanyandintervenorsaroundindemnificationbyapprovingComEd’sproposalthatbothsubscribersandtheproject itselfwill indemnify theCompanyagainst any liabilities relating to the reportingof asubscriber’sshareorasubscriber’sintervalusagedata–andthatComEdwillnothaveanyreciprocalindemnificationobligations.TheCommissionrejectedtheproposalofcertainintervenorsthatthenet metering credit paid to community renewable generation projects include the volumetrictransmissionservicescharge,inadditiontothesupplycharge(whichincludesanadjustmentfactor).

MidAmerican’s community renewable generation net metering tariff was approved by theCommission in Docket No. 17‐0368 on September 27, 2017. The tariff stipulates that bothsubscribersandtheprojectitselfwillindemnifytheCompanyagainstanyliabilitiesrelatingtothereportingofasubscriber’sshareorasubscriber’sintervalusagedata.MidAmerican’stariffwould

376220ILCS5/16‐107.5(l),(l‐5).


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providecommunityrenewablenetmeteringcreditsatthe“supplycharge,”pluscertainadjustmentfactors.

Ameren Illinois proposed revisions to its existing net metering tariff to include provisions forcommunity renewable generation project net metering. The revisions were approved by theCommissiononSeptember27,2017.AmerenIllinois’revisedtariffcreditstheenergyservicebillsofsubscribers to a community renewable generation project for net production at the “tariffed orcontractrateforelectricitysupplyasappropriate.”

AsdiscussedinSection7.6.2,theAgencybelievesthatthethreeapprovedtariffswillallowportabilityandtransferabilityofsubscriptions,asrequiredbySection1‐75(c)(1)(N)oftheAct.

TheAgencyunderstandsthatthereareongoingdiscussionsbetweenstakeholdersandtheutilitiesregardingthesetariffs(inparticular,issuesrelatedtobillcrediting).TheAgencywillactivelymonitorthosediscussions,andtotheextenttheyresultinchangestoanyorallofthesetariffs,theAgencywillupdatetheRECPricingmodeltoreflectanyofthosechanges.


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8. IllinoisSolarforAllProgram

8.1. OverviewTheIllinoisSolarforAllProgramwascreatedthroughrevisionstoSection1‐56(b)oftheIPAActcontainedinPublicAct99‐0906to“includeincentivesforlow‐incomedistributedgenerationandcommunitysolarprojects”withtheobjectiveto:

“bringphotovoltaicstolow‐incomecommunitiesinthisStateinamannerthatmaximizesthe development of new photovoltaic generating facilities, to create a long‐term, low‐income solarmarketplace throughout this State, to integrate, through interactionwithstakeholders,with existing energy efficiency initiatives, and tominimize administrativecosts.”377

The Act creates four sub‐programs within Illinois Solar for All, with incentives for each type ofdevelopment:

(A)Low‐incomedistributedgeneration,foron‐sitesolarprojects(B)Low‐IncomeCommunitySolar,foroff‐sitesolarprojects(C)Incentivesfornon‐profitsandpublicfacilitiestodoon‐siteprojects(D)Low‐IncomeCommunitySolarPilotProjects,withdistinctrulesandincentives

The Agency is instructed to “include a description of its proposed approach to the design,administration,implementationandevaluationoftheIllinoisSolarforAllProgram”inthisPlan.ThisChapterfulfillsthatprovisionoftheAct.

Whilethepriceofphotovoltaicshasdeclineddramaticallyoverrecentyears,therecanbesignificantupfrontcostsforthedevelopmentofprojects.ThefinancialincentivesofferedthroughtheAdjustableBlockProgrammaynotbesufficientforlow‐incomehouseholdsandcommunitiestoovercomethesubstantialbarrierstoparticipatinginthegrowingsolarenergymarket. TheIllinoisSolarforAllProgramisanalternativeapproachandprogramtohelpaddressthischallenge.

8.2. DesignConsiderationsTheAgencyhasidentifiedtwokeyelementsinimplementingtheIllinoisSolarforAllProgram:therelationshiptotheAdjustableBlockProgram,andthecreationofeconomicbenefitsforparticipants.

8.2.1. RelationshipwiththeAdjustableBlockProgramThegoalsoftheIllinoisSolarforAllProgramoverlapwiththegoalsoftheAdjustableBlockProgramin that both promote distributed photovoltaic generation and community solar. The differenceinvolvesthesectorsthattheprogramsserveandthestructureoftheincentivesandprogramdesign.

AsdescribedinthisChapter,theAgencywilladministertheIllinoisSolarforAllProgramseparatefrom theAdjustable Block Program, but building on the programdesign of theAdjustable BlockProgram,withadditionalconsiderationsspecifictoIllinoisSolarforAll.Theseincludeadifferentsetofincentives,additionalrequirementstobeanIllinoisSolarforAllApprovedVendor,IllinoisSolarforAllspecificcontracts,andadditionalconsiderationstoensurecommunityinvolvement,consumer

37720ILCS3855/1‐56(b)(2).


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protections, andeligibility.To theextentnot specificallymentioned in thisChapter, theprogramdesign,terms,andconditionsoftheAdjustableBlockProgramwouldalsoapplytotheadministrationof,andcontractsenteredintofor,theIllinoisSolarforAllProgram.

The exception to this principle is the Low‐IncomeCommunity Solar Pilot Projects,which do notparticipateintheAdjustableBlockProgram,andwhichtheAgencyproposestofundsolelythroughtheRenewableEnergyResourcesFundandadministerthroughacompetitiveprocurementprocess.

8.2.2. EconomicBenefitsThesecondconsiderationistheconceptof“economicbenefits”andhowlowincomeparticipantscancapture them. TheAct stipulates that for the Illinois Solar forAllProgram, “[e]ach contract thatprovidesfortheinstallationofsolarfacilitiesshallprovidethatthesolarfacilitieswillproduceenergyandeconomicbenefits,ataleveldeterminedbytheAgencytobereasonable,fortheparticipatinglowincomecustomers.”378Inaddition,contractsshould“ensure[that]thewholesalemarketvalueof the energy is credited to participating low‐income customers or organizations and to ensuretangibleeconomicbenefitsflowdirectlytoprogramparticipants,exceptinthecaseoflow‐incomemulti‐familyhousingwherethelow‐incomecustomerdoesnotdirectlypayforenergy.”379

Akeybarriertolow‐incomeparticipationinrenewableenergyprogramsislackofaccesstofundsandfinancingtopayfortheup‐frontcostsofphotovoltaicsystems.

To create “tangible economic benefits” at a “reasonable” level, the Agency has determined thateligiblelow‐incomeresidentialparticipantsintheIllinoisSolarforAllProgramshouldnothavetopay up‐front costs for on‐site distributed generation, or pay an up‐front fee to subscribe to acommunitysolarproject.Further,participationintheprogramshouldresultinimmediate,reliablereductionsinenergycostsforthoseresidentsorsubscribers.Thismeansthatforprojectsthatarefinancedorleased,anyongoingpaymentswouldbesmallerthantheexpectedenergysavings.

TheAgencywillrequirethatIllinoisSolarforAllApprovedVendorsverifythatdevelopers,installers,landlords,andotherintermediariesensurethattheresultingvalueoftheincentivesofferedbytheprogramflowthroughtothepeopletheprogramismeanttoserve.However,theAgencynotesthatinordertoavoidanoverlycomplexadministrativesystemforthisprogram,incentivelevelswillnotbecustomizedtoeachparticipant’sspecificeconomiccircumstances.AspartoftheevaluationoftheIllinoisSolarforAllProgram(seeSection8.17)theAgencywillreviewtheimpactoftheprogramontheenergycostsofparticipants toassesshowthebenefits createdby theprogramreduces theirenergy burden. This evaluationwill be used to inform any futuremodifications to the setting ofincentivelevelsdesignedtocreatetangibleeconomicbenefitsatareasonablelevelforparticipants.

Forpublicandnon‐profitfacilitiesthatparticipateintheIllinoisSolarforAllProgram,theAgencyproposesanapproachinwhichtheincentivelevelrecognizesthattheseentitiesmaynotbeabletocapturethetaxbenefitsthatacomparablesizedprojectthatparticipatesinsteadintheAdjustableBlock Programwould be able to. This adjusted incentive level can help overcome the financingbarriersthatnon‐profitsandpublicfacilitiesmayfacecomparedtoprivateentities.

Ensuring that “the wholesale market value of energy is credited to participating low‐incomecustomers” canbeachieved throughexistingnetmeteringprovisions.Therefore,projectswillbe37820ILCS3855/1‐56(b)(2).379Id.


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requiredtoparticipateintheapplicableutility’sorARES’snetmeteringprogram.Thismaypreventprojectsintheserviceterritoryofamunicipalutilityorruralelectriccooperativethatdoesnotoffernetmetering fromparticipating in the IllinoisSolar forAllProgram.TheAgencyhopes that suchmunicipalutilitiesandruralelectriccooperativesstronglyconsideradoptingnetmeteringpoliciestobringthefullvalueofsolartotheirresidentsandmembers.

Ensuring that tangible economic benefits flow directly to program participants can also beaccomplishedbyprovidingdocumentationtotheAgencythattheprojecthasnoupfrontcosttotheparticipant,thatthevalueofincentivesareusedbytheprojectdeveloper/installertooffsetcoststotheparticipant,andthattherewillnotbeongoingcostsorfeestotheparticipantthatexceedthevalueofenergyproduced.Theresultingeconomicbenefitstoprogramparticipantswillbeaccruedthrough the value they receive through net metering for the energy the system produces. AsdescribedinSection8.11,IllinoisSolarforAllApprovedVendorswillberequiredtodocumenthowtheyensurethatthisgoalismet.Thecaseoflow‐incomemulti‐familyhousingcanbemorecomplexandisdiscussedinmoredetailinSection8.6.1.

It should be noted that these incentives are tied directly to creating economic benefits throughlowerednetenergycostsandarecalculatedinthatmanner.Asaresult,theremaybeadditionalcostsrequiredtomakeaspecificprojectviable(e.g.,costsassociatedwithroofrepairsorwiringupgrades)that these incentivesmaynot be able to address. Additional incentives to pay for those types ofseparate costs will not be available through the Illinois Solar for All Program, and the Agencyencouragesparticipants toexplorealternativesourcesof fundingasneeded.TheAgencyand theIllinoisSolarforAllProgramAdministratorwillworkwithIllinoisSolarforAllApprovedVendorstofacilitateinformingandeducatingprogramparticipantsaboutopportunitiesthatmaybeavailabletothemthroughutility‐administeredenergyefficiencyprograms,weatherizationassistanceprograms,leadabatementprograms,andotherformsofsupport.

8.3. ProgramLaunchInimplementingthevariousnewprogramsandprocurementsmandatedbyPublicAct99‐0906,theAgencyhas a largeandvaried setofnew tasks toundertake.TheAgencyappreciates the stronginterestintheIllinoisSolarforAllProgramanddesiretomakethebenefitsoftheProgramavailabletolow‐incomehouseholdsandcommunitiessothattheycanbenefitfromlowerenergycosts.TheIllinoisSolarforAllProgramasproposedmostlybuildsontheAdjustableBlockProgramdescribedin Chapter 6; therefore, itwill be necessary first to have the Adjustable Block Program’s designfinalizedandputintooperationbeforetheIllinoisSolarforAllProgramwillbereadytolaunch.LikewiththeAdjustableBlockProgram,whilethisPlandetailsmanyprogrammaticconsiderations,finalprogramdesignincludingcontracts,programmanuals,etc.willneedtobedevelopedandfinalizedbytheAgencyandtheIllinoisSolarforAllProgramAdministrator(s)priortoprogramlaunch.ThismaycreatesomedelayinthestartoftheIllinoisSolarforAllProgram,buttheAgencywillendeavortomaketheIllinoisSolarforAllProgramavailableassoonaspracticable.

8.4. FundingandBudgetThe Illinois Solar for All Program is funded through three sources. First, the Renewable EnergyResourcesFundpursuanttoSection1‐56(b)(2)of the IPAAct;second, fundsfromtherenewableenergyresourcesbudgetsoftheutilitiespursuanttoSection1‐75(c)(1)(O)oftheIPAAct;andthird,potentialadditionalfundsfromtherenewableresourcesbudgetsoftheutilitiespursuanttoSection16‐108(k)ofthePublicUtilitiesAct.


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8.4.1. RenewableEnergyResourcesFundFundingAvailableWhileSection1‐56(b)(2)envisionstheIllinoisSolarforAllProgrambeingfundedprimarilythroughtheRenewableEnergyResourcesFund, as of September29, 2017, thebalanceof theRenewableEnergyResourcesFund is $23,601,311,while existing commitments from theFund for contractsfromtheSupplementalPhotovoltaicProcurementstotal$25,903,103.380

Prior to the enactment of Public Act 99‐0906, the Renewable Energy Resources Fund receivedAlternativeCompliancePaymentseachfallfromAlternativeRetailElectricSuppliersaspartoftheirRPScomplianceobligations.UndertherevisionstoSection16‐115DofthePUAcontainedinPublicAct99‐0906,thosepaymentsarenolongermadetotheFundasofJune1,2017;rather,theyarenowmadetotheutilitiesthroughMay2019.381Withtheendofthosepayments,thereisnonewrevenuethatwillbedepositedintotheFund.

The RERF’s current low balance is due to the fact that on August 10, 2017, $150 million wastransferredfromtheRenewableEnergyResourcesFundtotheGeneralRevenueFundpursuanttotherecentlyenactedborrowingprovisionscontainedinnewSection5h.5oftheStateFinanceAct.382ThosefundsarerequiredbylawtobepaidbacktotheRenewableEnergyResourcesFundwithintwoyears(i.e.,byAugust10,2019).

Section5h.5(b)containsaprovisionthatwhentheRERF(orforthatmatterotherstatefundsthathadsimilartransfers),

ha[s] insufficient cash from which the State Comptroller may make expendituresproperlysupportedbyappropriationsfromthefund,thentheStateTreasurerandStateComptroller shall transfer from general funds to the fund only such amount as isimmediatelynecessarytosatisfyoutstandingexpenditureobligationsonatimelybasis.

Likewise,thatSectionalsoprovidesfor,

continuingauthorityforanddirectiontotheStateTreasurerandStateComptrollertoreimbursethefundsoforiginfromgeneralfundsbytransferringtothefundsoforigin,atsuchtimesand insuchamountsasdirectedbytheComptrollerwhennecessarytosupportappropriatedexpendituresfromthefunds,anamountequaltothattransferredfrom themplusany interest thatwouldhave accrued thereon had the transfernotoccurred…

TheseprovisionsallowtheAgencytomakeexpendituresfromtheRERFpriortotherepaymentofthetransferredamount—i.e.,tooperateasthoughtheRERF’sbalancewereatitsoriginalamount,even if transferred funds have not yet beenmoved back into the RERF. In addition, the Agencyunderstands that the State Comptroller will coordinate with the Agency to make sure that anyappropriated expenditures that the Agency makes through new contractual commitments arehonoredbyensuringthatthebalanceoftheRERFisatalltimessufficienttomaketimelypaymentson contracts. While the Agency understands that recent transfers from the RERF have caused

380Thecommitmentsarebeingpaid,orwillbepaid,overafive‐yearRECdeliveryscheduledependingonwhenindividualsystemsundercontractarecompletedandbeginRECdeliveries.381AfterMay31,2019,theAlternativeCompliancePaymentsbyARESwillceasealtogether.38230ILCS105/5h.5(b);seePublicAct100‐0023.


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consternation,basedontheassurancescontainedinthelaw,itdoesnotbelievethatthesetransfersnecessitateanyadjustmentstoitsproposedSolarforAllprogramdesign,structure,andbudget.

Consistentwiththisapproach,theAgencyplanstoallocateupto$20millionperyearfromtheRERFforusefortheIllinoisSolarforAllProgram.ThiswouldensurethatRERFfundingfortheLow‐IncomeDistributed Generation Incentive, the Low‐Income Community Solar Project Initiative, and theIncentivesfornon‐profitsandpublicfacilitiesisavailableforseventoeightyearsiffullyspenteachyear,whileasdiscussedinSection8.6.4,fundingfortheLow‐IncomeCommunitySolarPilotProjectswouldbedistributedoveraten‐yearperiod.RERFfundsnotspentinayearwouldberolledovertothe following year. The funds allocated from the RERF would be allocated according to thepercentagesspecifiedinSection1‐56(b)(2)oftheAct,namely22.5%fortheLow‐IncomeDistributedGeneration Incentive, 37.5% to the Low‐Income Community Solar Project Initiative, 15% forIncentives for non‐profits and public facilities, and 25% for Low‐Income Community Solar PilotProjects(withanall‐timecapof$50million).383

After accounting for all payments under the Supplemental Photovoltaic Procurement processpursuanttoSection1‐56(i)oftheIPAAct,aswellasallpaymentsunderIllinoisSolarforAllcontracts,wheneverthebalanceoftheRERFfallsunder$5,000,thentheRERFshallbeinoperativeandanyremainingfundsshallbetransferredtotheSupplementalLow‐IncomeEnergyAssistanceFundforuseintheLow‐IncomeHomeEnergyAssistanceProgram,asauthorizedbytheEnergyAssistanceAct.384

8.4.2. UtilitiesAnnualFundingAvailableSection1‐75(c)(1)(O)containsaprovisionthat

The long‐termrenewableresourcesprocurementplanshallallocate5%of the fundsavailableundertheplanfortheapplicabledeliveryyear,or$10,000,000perdeliveryyear,whichever is greater, to fund the programs, and the plan shall determine theamountof funding tobeapportioned to theprograms identified insubsection (b)ofSection1‐56ofthisAct;providedthatforthedeliveryyearsbeginningJune1,2017,June1,2021,andJune1,2025,thelong‐termrenewableresourcesprocurementplanshallallocate10%ofthefundsavailableundertheplanfortheapplicabledeliveryyear,or$20,000,000perdeliveryyear,whicheverisgreater,and$10,000,000ofsuchfundsinsuch year shallbeusedbyan electricutility that servesmore than3,000,000 retailcustomers in theState to implementaCommission‐approvedplanunderSection16‐108.12ofthePublicUtilitiesAct.

TheAgencyexpectstheIllinoisSolarforAllProgramtobeginduringthe2018‐2019deliveryyear.AsdiscussedinSection2.2.5.3,theAgencyinterprets“fundsavailableundertheplan”intheabovestatutoryprovisiontomeanfundscollectedbyutilitiesthroughRPSridersunderSection1‐75(c)(6)of theActandSection16‐108(k)of thePUA.Thefollowingtable lists forthefirstthreeyearstheprojectedamountsofutilityfundingthatwouldbeallocatedtoIllinoisSolarforAllbasedupontheloadandbudgetforecastscontainedinChapter3.

383AssumingthatpaymentsfortheLow‐IncomeCommunitySolarPilotProjectsaremadeoveraten‐yearperiod,thatwouldbeupto$5millionperyear,whichwouldbeconsistentwitha25%allocationofthe$20millionperyearfromtheRenewableEnergyResourcesFund.38420ILCS3855/1‐56(b‐10).


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Table8‐1:UtilityFunding

DeliveryYear UtilityRenewableEnergyMaximumBudgets

5%ofFunds AllocationtoIllinoisSolarforAll

2018‐2019 $189,960,757 $9,498,038 $10,000,000

2019‐2020 $234,276,011 $11,713,801 $11,713,801

2020‐2021 $234,003,334 $11,700,167 $11,700,167

ThesefundswillbesuppliedbyeachutilitybasedontheallocationpercentagescontainedinSection3.1.ThesefundsarenotsubjecttothepercentageallocationsspecifiedforthefundingfromtheRERF,specifiedinSection1‐56(b)(2).TheAgencywillusetheutility‐suppliedfundingtosupplementtheprogramsthathaveuseduptheiravailablefundingfromtheRERF(withtheexceptionoftheLow‐IncomeCommunitySolarPilotProjects).

ThefundingforjobtrainingprogramsprovidedbyComEd(anelectricutilitythatservesmorethan3,000,000retailcustomers)underSection16‐108.12isnotedinthebudgetdiscussioninChapter3.AsthosefundsarenotdirectlypartoftheIllinoisSolarforAllProgramasmanagedbytheAgency,thosefundsarenotincludedinthisbudgetdiscussion.(TheintersectionbetweentheIllinoisSolarforAllProgramandthejobtrainingprogramsisdiscussedinSection8.10.)

8.4.3. Section16‐108(k)FundingSection16‐108(k)of thePublicUtilitiesActprovides forasituation inwhichthetotalamountoffundsappropriatedbytheGeneralAssemblyfrom385theRenewableEnergyResourcesFundduringtheperiodbetweenJune1,2017andAugust1,2018islessthan$200,000,000,creatinga“fundingshortfall.”ThisperiodencompassespartorallofthreestateFiscalYears(runningfromJuly1ofagivenyeartoJune30ofthefollowingyear).Ifthereisafundingshortfall,additionalfundingfromtheutilities could be available, as discussed below, to support Illinois Solar for All as part of asupplementalplandevelopedbytheAgency.

However,aspartof the timeperiod inquestion includes the firstmonthofFiscalYear2019, theamountofthefundingshortfall,ifany,willnotbeknownuntilaftertheFiscalYear2019budgetisadopted, which is expected to be during the late spring or summer of 2018. If this provision isinterpretedtobebasedontheamountsappropriatedforthewholeofallthreeFiscalYearscovered(ratherthanaproratedamountoftheappropriationsforthefirstandlastyears,FiscalYear2017andFiscalYear2019),thenforFiscalYear2017(whichendedJune30,2017),theappropriationthatwasmadefortheRenewableEnergyResourcesFundwas$50million,andforFiscalYear2018,also$50million—totaling$100millionthathasalreadybeenappropriatedbytheGeneralAssemblyforthe relevant period.386 The existence of a funding shortfall will depend upon the size of the

385ThesixthparagraphofthenewlyenactedSection16‐108(k)ofthePublicUtilitiesActdefinesthe“fundingshortfall”basedonamountsappropriatedbytheGeneralAssemblytotheRenewableEnergyResourcesFund.However,theGeneralAssemblyhas,infact,nevermadeanappropriationtotheRERF.TheGeneralAssemblydoes,though,regularlymakeappropriationsfromtheRERF.(See,e.g.,PublicAct99‐0524,enactedJune30,2016,atArt.24,§10;PublicAct100‐0021,enactedJuly6,2017,atArt.45,§10.)Thus,theIPAinterpretstheword“to”asascrivener’serror,intendedtomean“from.”386Id.


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appropriation theAgencyreceives fromtheRERF forFiscalYear2019,andwillonlyoccur if theappropriationislessthan$100million.TheAgencytypicallysubmitsitsappropriationsrequeststotheGeneralAssemblyinFebruaryofeachyear(inthiscase2018)anditsrequestistakenupalongwiththeothercomponentsofthestatebudgetduringtheSpringlegislativesession.387

TheAgencynotesthatanappropriationismerelyauthoritytospendfundsuptotheappropriatedamountforthepurposescontainedinanapplicableFiscalYear’sappropriationbill.Itmay,ormaynot,correspondtotheactualFundbalanceormatchactualexpendituresmadeinthatfiscalyear.

In addition, this funding is only available if the funds collected from ratepayers by the utilitiesthroughtheirRPSridersexceedtheirexpendituretofundtheirpurchasesofRECsundertheRPSduringeachof the2017‐2018,2018‐2019,and2019‐2020deliveryyears,andhalfofeachyear’sdifference,ifany,wouldbeavailabletooffsettheshortfall.Theamountcollectedandexpendedbytheutilitieswillalsonotbeknownuntilalaterdate,althoughbaseduponthescopeofprocurementsproposedforthe2017‐2018and2018‐2019deliveryyears,theAgencywouldexpectthattheamountcollectedfromcustomerswillsignificantlyexceedactualexpendituresbytheutilitiesonRenewableEnergyCredits. TheAgencywill askeachutility toprovideanaccountingofRPScollectionsandexpendituresfollowingtheendofeachdeliveryyear.

IfthereisafundingshortfallandthereareutilityRPSriderovercollectionsduringthe2017‐2018,2018‐2019,and/or2019‐2020deliveryyearsthat,inaggregate,donotexceedthefundingshortfall,thenSection1‐56(b)(7)providesthat,

Ifadditionalfundingfortheprogramsdescribedinthissubsection(b)isavailableundersubsection(k)ofSection16‐108ofthePublicUtilitiesAct,thentheAgencyshallsubmitaprocurementplantotheCommissionnolaterthanSeptember1,2018,thatproposeshowtheAgencywillprocureprogramsonbehalfoftheapplicableutility.Afternoticeandhearing,theCommissionshallapprove,orapprovewithmodification,theplannolaterthanNovember1,2018.

ForthepurposesofthisPlan,itisnotyetknownwhethera“fundingshortfall”willoccurandifthissourceoffundingwillbeavailable.Ifthesefundsbecomeavailablefollowingthe2017‐2018deliveryyear,theAgencywilldevelopandsubmitaPlantotheCommissionbySeptember1,2018toreflectifandhowanysuchfundswouldbeproposedtobeusedbeginninginthe2018‐2019deliveryyear.

8.4.4. SettingBudgetsTheAgency is developing the Illinois Solar forAll Programunder the assumption that the fundsavailableforthe2018‐2019deliveryyearwillbefundsfromtheRERFandtheutility‐suppliedfundsidentifiedinSection8.4.2.Table8‐2providesasummaryoftheIllinoisSolarforAllfunding.

387 As an independent State Agency, under the oversight of the Executive Ethics Commission, the Agency develops its appropriationrequestsseparatelyfromthebudgetdevelopedbytheGovernor.


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Table8‐2:IllinoisSolarforAllBudgets

ProgramYear

RenewableEnergyResourcesFund

UtilityFunding FundingShortfall TotalFunding

2018‐2019 $20,000,000 $10,000,000 TobeDetermined $30,000,000

2019‐2020 $20,000,000 $11,708,367 TobeDetermined $31,708,367

2020‐2021 $20,000,000 $11,694,637 TobeDetermined $31,694,637

8.4.5. PaymentStructureThe Illinois Solar forAll Program is structured so that theAgency “may pay for such renewableenergycreditsthroughanupfrontpaymentperinstalledkilowattofnameplatecapacitypaidoncethedeviceisinterconnectedatthedistributionsystemleveloftheutilityandisenergized.”388Section6.14.5describestheoptionsforthecapacityfactorusedintheAdjustableBlockProgramtoconvertkilowattsizeofaprojecttothenumberofRECsthesystemwouldbeexpectedtogenerateover15years.ThosesameoptionswillbeusedforIllinoisSolarforAll,thepricepaidwillbeexpressedonadollarperRECbasis,andpaymentswillbebaseduponthe15‐yearexpectedRECproductionofthesystem.Forexample,asdescribedinthatsection,usingthestandardcapacityfactorwouldmeanthatforeachkWofcapacityforafixed‐mountsystemapproximately21RECswouldbegeneratedover15years.

PaymentsforIllinoisSolarforAllincentiveswillbeupfrontpaymentsonenergizationofsystems,withthesameconditionastheAdjustableBlockProgramthatasystemmustalsoberegisteredinGATSorM‐RETSsoastobeabletoverifythatitwillproduceRECs.However,asdiscussedinSection8.6.4, theAgencyproposes adifferentpayment structure for Low‐IncomeCommunitySolarPilotProjects,whichdonotparticipateintheAdjustableBlockProgram.

ContractswillbeeitherwiththeAgencyorautility,dependingonthefundingsource,389andwillincludetheassignmentofRECsfromeachsystemfor15years.RECsfromthesecontractswillbeappliedtotheannualRPSgoalsoftheutilitytowhichtheprojectisinterconnected,butwillnotcounttowardeachutility’snewphotovoltaic targets.390Projects that receive a contract through IllinoisSolarforAllwillnotbeeligiblealsotoreceiveacontractthroughtheAdjustableBlockProgram.391

38820ILCS3855/1‐56(b)(3).389See20ILCS3855/1‐56(b)(2)(“ContractsthatwillbepaidwithfundsintheIllinoisPowerAgencyRenewableEnergyResourcesFundshallbeexecutedbytheAgency.Contractsthatwillbepaidwithfundscollectedbyanelectricutilityshallbeexecutedbytheelectricutility.”)390Seeid.391Section1‐56(b)(3)requiresthatforIllinoisSolarforAllcontracts,“[t]hepaymentshallbeinexchangeforanassignmentofallrenewableenergycreditsgeneratedbythesystemduringthefirst15yearsofoperation.”Sections1‐75(c)(1)(L)(ii)and(iii)bothcontainprovisionsrelatedtothevariouscomponentsoftheAdjustableBlockProgramthat,“[t]heelectricutilityshallreceiveandretireallrenewableenergycredits generated by the project for the first 15 years of operation.” These two provisions from Section 1‐56(b)(3) and Section 1‐75(c)(1)(L)aremutuallyexclusiveasonlyoneRECcanbeproduced,transferred,andretiredforeachMWhofgeneration.


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ContractswiththeAgency(thatutilizefundsfromtheRERF)willbestandardcontractsthatincludeallrequiredstatecontractprovisionsincludingthattheyaresubjecttoappropriation.Contractswithutilitieswillbesimilar,totheextentpracticable,tothecontractswiththeAgency.

TheActissilentonhowtoallocateRECsfromprojectslocatedintheserviceterritoriesofmunicipalutilities,ruralelectriccooperatives,orMt.CarmelPublicUtility.TheAgencysuggeststhatRECsfromthoseprojectsprocuredthroughcontractswiththeAgencyusingtheRERFwouldnotbeappliedtheutilityRPSgoals,whileanyRECsprocuredthroughcontractswithautilitywouldbeappliedtotheRPSgoalsofthecontractingutility.

8.5. ProgramsSection1‐56(b)(2)outlinesfoursub‐programsoftheIllinoisSolarforAllProgram:

1. Low‐IncomeDistributedGenerationIncentive2. Low‐IncomeCommunitySolarProjectInitiative3. IncentivesforNon‐ProfitsandPublicFacilities4. Low‐IncomeCommunitySolarPilotProjects

ThefirstthreeofthesewillprovideanincentivebasedonthepriceperRECfromtheAdjustableBlockProgramwithadjustmentstothatpriceasdescribedbelowtoaccountforthespecificneedsoftheIllinoisSolarforAllProgram.Thefourthsub‐programwillbecompetitivelyprocuredbasedonthecompetitiveprocurementapproachdiscussedinChapter5,andfurtherbelowinSection8.6.4.

In addition to those four components, a provision of the Act allows stakeholders to proposealternativeprograms,

“InthecourseoftheCommissionproceedinginitiatedtoreviewandapprovetheplan,includingtheIllinoisSolarforAllProgramproposedbytheAgency,apartymayproposean additional low‐income solar or solar incentive program, ormodifications to theprogramsproposedby theAgency,and theCommissionmayapproveanadditionalprogram, ormodifications to the Agency's proposed program, if the additional ormodifiedprogrammore effectivelymaximizes thebenefits to low‐income customersaftertakingintoaccountallrelevantfactors,including,butnotlimitedto,theextenttowhichacompetitivemarketforlow‐incomesolarhasdeveloped.”392

Basedonexperienceandbestpractices inotherstatesand jurisdictions, theAgency isproposingprogramelementsinSection8.7intendedtoincreasethesuccessoflow‐incomesolardeploymentinIllinois. Those elements are intended to go beyond providing financial incentives to includeprovidingguidanceonprojectdevelopmentforlow‐incomecustomers,non‐profits,andpublicsectorcustomers.

AslistedinTable8‐3,atleast$30millionisexpectedtobeavailableforthe2018‐2019deliveryyear.The$10millionofutility‐suppliedfundingwillnotbeavailablefortheLow‐IncomeCommunitySolarPilotProjects393,andthepercentagefundingallocationsonlyapplytothefundsfromtheRenewableEnergy Resources Fund. The Agency proposes that the utility‐supplied funding will be evenly

39220ILCS3855/1‐56(b)(4).393SeeSection8.6.4foradiscussionoffundingsourcesfortheLow‐IncomeCommunitySolarPilotProjects.


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allocatedtotheotherthreeprogramsatthesamerelativeweightings,butwillmonitoractivityandmayshifttheuseoftheutilityfundingasneeded.

Table8‐3:DeliveryYear2018‐2019IllinoisSolarforAllFundingAllocations

FundingSource

Low‐IncomeDistributedGenerationIncentive

Low‐IncomeCommunitySolarProjectInitiative

IncentivesforNon‐ProfitsandPublicFacilities

Low‐IncomeCommunitySolarPilotProjects

22.5% 37.5% 15% 25%

RERF $4,500,000 $7,500,000 $3,000,000 $5,000,000

Utility $3,000,000 $5,000,000 $2,000,000

Total $7,500,000 $12,500,000 $5,000,000 $5,000,000

Notethatthesefundingallocationsincludeprogramadministrationexpenses,grassrootseducationfunding(upto5%ofavailablefunds),aswellaspaymentsforRECs.

8.6. SettingIncentiveLevelsTheincentivelevelsdescribedinthefollowingSectionswerederivedbytakingtheRECpricesfortheAdjustableBlockProgramasdescribedinSection6.4andmakingadjustmentstomeettheobjectivesof the Illinois Solar forAll Program.These incentives andwill beoffered through a 15‐yearRECdeliverycontract,eitherwiththeAgencyforprojectsfundedwiththeRenewableEnergyResourcesFund,orautilityforprojectsfundedthroughutility‐suppliedfunds.

Incentive levels are expressed as REC prices, andwill be set according to the same groups andcategories as theAdjustableBlockProgram (GroupA forprojects located inAmeren Illinois,Mt.Carmel,MidAmerican,andruralelectriccooperativesandmunicipalutilitieslocatedinMISO;GroupB forprojects located inComEd,andruralelectriccooperativesandmunicipalutilities located inPJM).UnliketheAdjustableBlockProgram,theseincentiveswillinitiallynotbechangedbaseduponblocksofcapacityfillingup.Rather,theAgencyproposestoreviewandupdatetheincentivelevelson an annual basis. That updatewill include an adjustment to account for how the comparableAdjustableBlockProgramRECpriceforeachGroupandcategoryhaschangedsincethepreviousupdate(ororiginalRECpricesasdeterminedinthisPlan),allowingforthepricesofferedthroughIllinoisSolarforAlltotrackoverallmarketconditionswhilecontinuingtobeofferedatahigherlevelthanfortheAdjustableBlockProgram.

FortheLow‐IncomeDistributedGenerationIncentive,theRECpricesareadjustedinthemodelbysettingthedebtfinancingoftheprojectto0%,andincreasingthenetmeteringbenefitfrom20%to50%.ForLow‐IncomeCommunitySolar, theRECpricesareadjustedbyshortening the financingtermtofiveyearsandloweringthedebtfinancingto35%.Forthenon‐profitandpublicfacilitiesincentive,theRECpricesareadjustedbyconsideringtheprojectasanon‐taxableentity.TheAgencybelieves theseapproachesrepresent reasonableproxies for thehigher incentive levelneeded forIllinoisSolarforAllprojectstoovercomethefinancingbarriersandotherhurdlestheseprojectface.


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AswiththeRECpricesfortheAdjustableBlockProgram,theIllinoisSolarforAllincentivelevelsdescribedinthisPlanshouldbeconsideredpreliminary,andpartiesshouldnottakeactionsinrelianceontheseproposals.

8.6.1. Low‐IncomeDistributedGenerationIncentiveTheLow‐IncomeDistributedGenerationIncentiveisintendedtoprovidefundingforphotovoltaicprojectslocatedonindividualhomesandmulti‐familybuildings.Inadditiontotherequirementsofthe Adjustable Block Program, qualifying projects will be subject to the additional low‐incomeconsumer protections outlined in Section 8.14. As described in Section 8.15.4, 25% of availablefundingwillbetargetedtoenvironmentaljusticecommunities.

8.6.1.1. Eligibility

TheAgencyproposestotreatbuildingswithonetofourunitsdifferentlythanbuildingswithfiveunitsormore.Forsingle‐familyhomes,householdswillhavetoverifythattheyarelow‐income;fortwo‐to‐fourunitbuildings,atleasttwoofthehouseholdswillhavetobeverifiedaslow‐income.Forfive‐unitandlargerbuildings,eitheratleast50%ofthetenantsmustbeverifiedaslow‐income,orthebuildingmustbedemonstratedtomeetthedefinitionof“affordablehousing”containedintheIllinoisAffordableHousingAct.SeeSection8.13.1formoreinformationonincomeverificationandSection8.13.2formoreinformationonincomeeligibility.Inadditiontoprojectsbeingeligiblebasedonhouseholdincome,projectsdevelopedonhomesorbuildingsthatqualifyforUSDepartmentofHousing and Urban Development (“HUD”) Project‐Based Vouchers or Project‐Based RentalAssistance (which are programs for housing units dedicated to low‐income tenants) would alsoqualify.TheincomequalificationlevelsrequiredforparticipationintheseprogramsislowerthanincomerequirementsfortheIllinoisSolarforAllprogram.

8.6.1.2. DemonstratingTangibleEconomicBenefitsforResidentsofMultifamilyBuildings

Section 1‐56(b)(2) requires that the Illinois Solar For All incentives deliver tangible economicbenefits for eligible low‐income customers, including those that live in multifamily buildings.Multifamilybuildings canbeeithermastermeteredor individuallymetered.Formaster‐meteredbuildings, the economic benefits of installing a photovoltaic systemwill not directly impact theoccupantsofthebuildingbecausetheydonotindividuallypayanelectricbilltotheirelectricutility;but instead the benefits accrue to the building owner/manager. Therefore, for master‐meteredbuilding owners to be eligible for Low‐Income Distributed Generation incentives, the buildingowner/managerwillneedtocommittopassingalongaportionofthevalueoftheenergysavingsfromnetmetering to the tenants through reduced (or not raised) rents, or byothermeans. Thecommitmentshouldalsoincludeadescriptionofhowthiswillbeaccomplished.

Formultifamilybuildingsthatarenotmastermetered,onechallengeisthatthephotovoltaicsystemwillmostlikelybeconnectedtothemainbuildingaccountthatservescommonareasandbuilding‐wideloadratherthantoanyindividualunit’saccount.Forthesebuildings,theowner/managermusteitherprovidethesamedemonstrationofpassingalongbenefitstotenantsasformaster‐meteredbuildings,or inthealternative,mustcommittoofferingtenantstheopportunity(atnoadditionalcostleviedbythelandlord)toparticipateinnetmeteringpursuanttotheprovisionsofSection16‐107.5(l)(1)(B) of the PUA, which allows for net metering of “individual units, apartments, or


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properties located in a single building that are owned or leased by multiple customers andcollectivelyservedbyacommoneligiblerenewableelectricalgeneratingfacility.”

8.6.1.3. IncentiveLevel

Table8‐4:IncentivesfortheLow‐IncomeDistributedGenerationProgram($/REC)

SystemSize GroupA

GroupB

<=10kW $150.58 $145.30

>10‐25kW $132.43 $127.95

>25‐100kW $102.56 $98.89

>100‐200kW $85.31 $81.63

>200‐500kW $77.17 $73.49

>500‐2000kW $73.91 $70.24

These incentive payments are intended to be sufficient to provide tangible economic benefits toparticipantsthroughenablingprojectdeveloperstoeliminateupfrontcoststotheparticipantsfortheinstallationofphotovoltaicprojects.Theincentivewillbeastandardincentiveexpressedasapaymentforthecontractuallyobligateddeliveryofarenewableenergycreditandnotcustomizedforeachproject.

ProjectsthatparticipateinthisincentivewillalsobesubjecttotheprovisionsrelatedtojobtrainingdiscussedinSection8.9.

8.6.2. Low‐IncomeCommunitySolarProjectInitiativeThisinitiativeisintendedtosupportparticipationincommunitysolarbylow‐incomesubscribers.Inordertoqualifyforthisinitiative,asetofconditionsforacommunitysolarprojectarerequiredthatgobeyondtherequirementsoutlinedintheActforcommunityrenewablegenerationprojectsandforcommunitysolarprojectsthatparticipateintheAdjustableBlockProgram.Theseinclude:

“Eachprojectshallidentifyitspartnershipwithcommunitystakeholdersregardingthelocation,development,andparticipation intheproject,providedthatnothingshallprecludeaprojectfromincludingananchortenantthatdoesnotqualifyaslow‐income.”

“Incentives should also be offered to community solar projects that are 100% low‐incomesubscriber owned,which includes low‐income households, not‐for‐profit organizations, andaffordablehousingowners.”394

Forthefirstprovision,IllinoisSolarforAllApprovedVendorssubmittingaLow‐IncomeCommunitySolarProjectwillneedtoincludeintheapplicationforthatprojectadescriptionofapartnershipwithcommunitystakeholdersinthecommunitywheretheprojectwillbelocated.WhiletheActdoes

39420ILCS3855/1‐56(b)(2)(B).


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not define the term “community stakeholders,” the National Community–Based OrganizationNetwork(NCBON)definesacommunity‐basedorganizationasoneinwhich:

Themajorityofthegoverningbodyandstaffconsistsoflocalresidents, Themainoperatingofficesareinthecommunity, Priorityissueareasareidentifiedanddefinedbyresidents, Solutionstoaddresspriorityissuesaredevelopedwithresidents,and Program design, implementation, and evaluation components have residents intimately

involved,inleadershippositions.395

TheAgencywillconsiderentitiesthatdemonstratehowtheymeetthisdefinitionasbeingabletorepresentcommunitystakeholdersinapartnership.Furthermore,theAgencybelievestheintentoftheActwastocreatesubstantialpartnerships,goingbeyondjustholdingafewcommunitymeetings.In addition to information regarding location, development andparticipation, thesepartnershipsshouldincludeadescriptionofhowthepartnershipshowsthatitisresponsivetotheprioritiesandconcernsoflow‐incomemembersofthecommunity.

If theproposedprojecthasananchortenantthatdoesnotqualifyas low‐income, theapplicationshoulddescribethattenantindetail;theIllinoisSolarforAllincentivewillbereducedtoaccountforthe share of the system subscribed by that tenant not receiving a low‐income incentive. For thepurposesofthisadjustment,iftheanchortenantisanot‐for‐profitorganizationorapublicsectorentity, then the incentivewillnot be reduced to account for the share subscribed by the anchortenant.Thisisintendedtoencourageprojectstohavenot‐for‐profitorpublicsectoranchortenantsratherthanfor‐profitentities.

For the secondprovision, regarding projects “that are 100% low‐income subscriber owned,” theAgencyassumestheActintendedtheplainmeaningoftheword“ownership,”andnotthatprojectsbemerely100%“subscribed”bylow‐incomecustomers.Forprojectsthatcandemonstratethattheyare100%ownedbylow‐incomesubscribers(includingnot‐for‐profitorganizations,andaffordablehousingowners),theincentivelevelwillbeincreasedby$5/REC.Tobeeligibleforthisadditionalincentive,theIllinoisSolarforAllApprovedVendorwillneedtocertifytheintentfortheprojecttobe100%low‐incomesubscriberownedatthetimeofapplication,andiftheprojectisnotinitiallystructured thisway,will have up to six years after energization to complete the full transfer ofownershiptothelow‐incomesubscribers.Thepriceofthetransfermustbeprovidedatthetimeofapplication,andwillbesubjecttoapprovalbytheAgency.Itmustalsocontainacommitmentthattheprojectremain100%low‐incomesubscriberownedafterthetransfer.TheadditionalincentivewillbepaidonlyupontheIllinoisSolar forAllApprovedVendorprovidingdocumentationtotheAgencythattheprojectis100%low‐incomesubscriberowned.

AsdescribedinSection8.15.4,25%ofavailablefundingwillbetargetedtoenvironmental justicecommunities.

395 National Community–Based Organization Network (NCBON), “What is a Community–Based Organization (CBO)?”https://sph.umich.edu/ncbon/whatis.html.AccessedSeptember2017.


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Table8‐5:IncentivesforLow‐IncomeCommunitySolarProjects($/REC)

SystemSize GroupA

GroupB

<=10kW $156.21 $152.68

>10‐25kW $142.05 $138.52

>25‐100kW $115.82 $112.29

>100‐200kW $97.87 $94.34

>200‐500kW $89.71 $86.18

>500‐2000kW $86.12 $82.59

TheseincentivesforLow‐IncomeCommunitySolarProjectsarefortheportionoftheprojectthatissubscribedbylow‐incomesubscribers.Inordertoreceivetheincentiveatthetimeofenergization,theApprovedVendorwillhavetoverifytheleveloflow‐incomesubscriberstotheProjectasoutlinedin Section 8.13.1. The Agency notes that the Adjustable Block Program only requires 50% ofsubscribers(inkWvolume)tobeidentifiedatthetimeofenergization,andthatresidentialaddersaregrantedonlyiftheprojectmeetstheresidentialsubscriberlevelafteroneyearofoperation.Thisprinciple will apply to Low‐Income Community Solar as well. Only 50% of the low‐incomesubscriberswillneedtobeidentifiedbythetimetheprojectisenergizedtoreceivetheincentive.However,theamountof incentivepaymentwillbeproratedtothelow‐incomesubscriptionlevel.Afteroneyear,theremainingincentivewillbepaidbaseduponthelow‐incomesubscriptionlevelachievedbythattime.

Inordertoensureongoingsubscriptionlevelsbylow‐incomesubscribers,theApprovedVendorwillhavetoprovideongoingcollateralfortenyearsequalto5%oftheremainingRECvalueandreportannuallyon low‐incomesubscriptionlevels. If thoselevelsarenotmaintained,thenthecollateralmaybecalledupontoclawbacktheincentivestotheleveloflow‐incomesubscription.

8.6.3. IncentivesforNon‐ProfitsandPublicFacilitiesSection1‐56(b)(2)(C)oftheActspecifiesthat“non‐profitsandpublicfacilities”areeligibletoreceiveincentives foron‐sitephotovoltaicgeneration. These incentivesaredesigned to “supporton‐sitephotovoltaicdistributedrenewableenergygenerationdevicestoservetheloadassociatedwithnot‐for‐profitcustomersandtosupportphotovoltaicdistributedrenewableenergygenerationthatusesphotovoltaictechnologytoservetheloadassociatedwithpublicsectorcustomerstakingserviceatpublic buildings.”396 The Act does not specify what non‐profit organizations or public sectorcustomersmaybeeligible.

39620ILCS3855/1‐56(b)(2)(C).


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GiventhattheobjectiveoftheIllinoisSolarforAllProgramisinpart,“tobringphotovoltaicstolow‐income communities,”397 it could be reasonable to infer that the non‐profits and public sectorcustomers that in some manner serve low‐income communities should be given specificconsideration. However, the Act could also be interpreted such that all non‐profits and publicfacilitieswouldbeeligibletoparticipate.ThisinterpretationwouldbeconsistentwiththeGeneralAssembly’sfindingsthat“theStateshouldencouragetheadoptionanddeploymentofcost‐effectivedistributedenergyresourcetechnologiesanddevices,suchasphotovoltaics,whichcanencourageprivate investment in renewable energy resources, stimulate economic growth, enhance thecontinueddiversificationofIllinois’energyresourcemix,andprotecttheIllinoisenvironment”398—whichcouldinvolveawiderrangeofphotovoltaicfacilitiesthatwouldbeeligiblefortheseincentives.

In order tobalance theseobjectives, initially‐Illinois Solar forAllApprovedVendorswill have todemonstratethattheprojectmeetsoneofthefollowingcriteria:

DocumentthattheprojectmeetsthestandardsdescribedinSection8.11relatedtoprojectshavingsufficientconnectionto,andinputfrom,low‐incomecommunitymembers,

Demonstratethattheprojectislocatedatafacilityownedbyanorganizationthatisacriticalserviceproviderforthecommunity(e.g.,youthcenters,hospitals,schools,homelessshelters,seniorcenters,communitycenters,placesofworship,affordablehousingprovidersincludingpublichousingsites).

AfteroneyearofoperationtheAgencywillassessparticipationintheprogram,andifparticipationintheprogramisnotmeetingitsbudgetedgoals,theneligibilitywillbeexpandedtoothernon‐profitsandpublicfacilities.

AsdescribedinSection8.15.4,25%ofavailablefundingwillbetargetedtoenvironmental justicecommunities.


Table8‐6:IncentivesforNon‐ProfitsandPublicFacilities($/REC)

SystemSize GroupA

GroupB

<=10kW $147.88 $144.20

>10‐25kW $133.25 $129.57

>25‐100kW $107.83 $104.15

>100‐200kW $91.82 $88.15

>200‐500kW $84.31 $80.63

>500‐2000kW $81.37 $77.69

39720ILCS3855/1‐56(b)(2).398PublicAct99‐0906,Section1(a)(1)(“Findings”).


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8.6.4. Low‐IncomeCommunitySolarPilotProjectsLow‐IncomeCommunitySolarPilotProjectswillparticipateintheIllinoisSolarforAllPrograminamannerthatisdifferentfromprojectsthatparticipateintheotherportionsoftheProgram.

Unlikethoseotherprograms,theLow‐IncomeCommunitySolarPilotProjects“shallbecompetitivelybidbytheAgency,subjecttofairandequitableguidelinesdevelopedbytheAgency.”399Thismeansthat rather than applying to the Illinois Solar for All Program and receiving an administrativelydeterminedRECprice,theincentivewillbedeterminedthroughacompetitivebiddingprocessasoutlinedinChapter5.TheAgencyhasawell‐establishedprocessforcompetitiveprocurementsandforthisprocess,theAgencywillleveragethatexperience.

InadditiontothegeneralprovisionsthattheAgencyusesforcompetitiveprocurements(e.g.sealed,pay‐as‐bid request for proposal process), the Agency also recommends that certain provisionsrelated toothercommunitysolarprojectsalsoapply to thepilotprojects including theeighteen‐monthwindowoftimeforprojectdevelopment,andprojectandcustomerinformationrequirements.

TheprocurementforLow‐IncomeCommunitySolarPilotProjectswillbebidona$/RECbasis,forcontractsthatwillbefor15yearsofdeliveryofallRECsfromtheprojecttotheAgencyoncetheproject isenergized.Thepricepaidwillbebasedsolelyonthebidpriceandwillnot includeanypaymentbasedontheAdjustableBlockProgramRECprices(oradders/adjustments).Paymentswillbemadeoverthefirst10yearsofthecontract.Toensurethattheprocurement follows“fairandequitableguidelines,”theAgencyproposesthatbidsbeevaluatedonlyonthebasisofprice,asthisisthemostobjectiveway toconsiderbidevaluation.While theLow‐IncomeCommunitySolarPilotProject procurement process requires additional considerations (described below), the Agencybelievesthatthoseconsiderationsarebetterappliedasminimumcriteriafordeterminingeligibilitytoparticipateintheprocurementratherthanappliedtotheevaluationofcompetingbids(withthelimitedexampleprovidedbelowforwhybidscouldbeconsideredoutofpriceorder).

ThereareseveralconsiderationsunderSection1‐56(b)(2)(D)of theAct forhowthecompetitiveprocurement is conducted thatmust be specifically considered and adapted for the Low‐IncomeCommunitySolarPilotProjectscompetitiveprocurement.

First, the Agency notes that the total funding over time for Low‐Income Community Solar PilotProjects cannot exceed $50,000,000, and that it cannot exceed $20,000,000 per project.Furthermore,projectsareallowedtobelargerthanthe2,000kWlimitthatotherwiseappliesforcommunityrenewablegenerationprojectsundernetmeteringlawsandtariffs.Thismeansthatasfew as three projects could be selected to participate (e.g., two $20,000,000 projects and one$10,000,000 project), although depending on thewinning bids, the number of projects could begreater.

Second,projects“mustresultineconomicbenefitsforthemembersofthecommunityinwhichtheprojectwillbelocated.”TheAgencybelievesthatthisprovisioncanbemetbyrequiringprojectsthatwishtobidintheprocurementadheretothesameprovisionsastheLow‐IncomeCommunitySolarProjects in terms of partnerships with community stakeholders. Projects must also provideinformationabouthowtheywill complywith thisprovision throughoptionssuchasprovidingacommitmenttolocalhiring,describingimpactonpaymentstocommunityresidentsororganizations

39920ILCS3855/1‐56(b)(2)(D).


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aspartoftheprojectdevelopmentprocess,andofferingofsubscriptionstocommunityresidentsandorganizations.Failuretomeetcommitmentsmadeduringthebidder/projectregistrationphaseoftheprocurementwillbeconsideredactions thatwouldresult inadefaultandcancellationof thecontract.

Third, projects “must include a partnership with at least one community‐based organization.”Information on the partnershipwill be required to register during the initial bidder registrationphase and projects that cannot demonstrate such a partnership will not be eligible to bid. Asdescribed inSection8.6.2, thecommunity‐basedorganization(s) shouldbeanexistingnon‐profitorganizationthatprovidesprogramsandserviceswithinthecommunitywheretheproposedprojectwillbelocated.

Fourth,funds“maynotbedistributedsolelytoautility;”andfifth,“atleastsomefundsunderthissubparagraph (D)must includeaprojectpartnership that includes communityownershipby theprojectsubscribers.”Thesetwoprovisionscreateinterestingchallengesintheevaluationofbids.Forexample, ifbidsarereceivedandonly thehighestpricedbid includes “aprojectpartnership thatincludescommunityownership,” (adistinctrequirementaroundownershipthatgoesbeyondtherequirement that applies to all projects that they have a partnership with a community‐basedorganization)butconstitutes theonlyprojectable tobesupportedunder theavailablebudget, itwould have to be selected. Similarly, in order to ensure that funds are not distributed solely toutilities,bidsmayneedtobeselectedoutofpriceorder,otherwise,onlyautilityprojectwouldwin.

Because utilities are potentially bidders in this procurement, the Agency recommends that thecontracts resulting from this procurement only be entered into by the Agency and only use theRenewableEnergyResourcesFundasasourceofcontractfunding.WhilegenerallytheIllinoisSolarforAllProgramallowsforcontractstobeenteredintoeitherwiththeAgency(usingtheRERF)orwithoneoftheutilities,itwouldbeinappropriateforutilitiespotentiallytoenterintocontractswiththemselves,andfurthermore,theprocurementprocesscouldallowforthemastheBuyertoreceiveconfidentialinformationfromcompetingbidders(e.g.,potentialSellers).

TheAgencyrecommendsthattheprocurementforLow‐IncomeCommunitySolarPilotProjectsbeconductedinlate2018orearly2019.

8.7. ProvidingGuidanceandEducationTheIllinoisSolarForAllProgramprovidessubstantialfinancialincentivesintendedtoenablelow‐income, non‐profit, and public sector customers to share in the benefits of solar power. Thesecustomersarespecificallyidentifiedinthelegislationpartlybecausetheyfaceadditionalhurdlesindeployingsolar,suchasalackoftaxableincomeneededtomonetizetax‐basedincentives,alackofaccesstocapital,orinstitutionalbarriersthatlimitdeployment.

Atthesametime,suchcustomershaveaccesstoawidevarietyofnon‐energyprogramsandpoliciesintendedtopromoteeconomicdevelopment,provideaffordablehousing,andreducetheburdensofpoverty. Programs from the U.S. Department of Housing and Urban Development, for example,provide financial assistance for housing and utility bills. Such programs are supporting solardeploymenttoreduceutilityexpensesforbothresidentsandtaxpayers.

Experience inother stateshas shown that therearemany finance‐relatedandotherpoliciesandprogramsatthefederal,state,andlocallevelthatcanbeappliedtolow‐incomesolardevelopment.


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The Agency believes that the Illinois Solar For All Program would benefit from guidance andeducation provided to Illinois Solar for All Approved Vendors, community groups, public‐sectorcustomers,andothers,inadditiontothefinancialincentivesdescribedinothersectionsofthePlan.OnevehicleforprovidingsuchguidancewillbetheProgramAdministrator(s)selectedtomanagetheIllinoisSolarForAllProgram.Therefore,relatedtaskswillbeincludedintherequirementsforprogramadministration,describedbelow.

8.8. IllinoisSolarforAllProgramAdministratorTheAgencywill issueaRequest forQualifications, thenaRequest forProposals foroneormoreIllinoisSolarforAllProgramAdministrator(s).TheProgramAdministrator(s)willbeselectedonthebasis of evaluating their ability to implement the program described here, and specifically theselectioncriteriawillincludeconsiderationofapplicant’s“experienceinadministeringlow‐incomeenergy programs and overseeing statewide clean energy or energy efficiency services.”400 Theselection of one or more Program Administrators may depend on the ability of applicants toadequatelyservetheentireState,and/ortoservespecificsub‐programs(inparticulartheabilitytodifferentiatetheneedsofsingle‐familyandmultifamilyhousingandprovidetheappropriatesupportandtechnicalassistancetoeachsector).ProgramAdministrator(s)maynotalsobeanIllinoisSolarfor All Approved Vendor. The Request for Proposals for Illinois Solar for All ProgramAdministrator(s)andfortheAdjustableBlockProgramAdministratorwillbeconductedseparately;therewillbenoprohibitionagainstanentityservinginbothroles.Theapprovalofthecontract(s)fortheIllinoisSolarforAllProgramAdministratorwillbesubjecttoapprovalbytheCommissionafterthisPlanisapproved.TheAgencywillreviewandscoretheRequestforProposalssubmittedbyqualifiedbiddersandwillsubmitthecontractsforitsselectedbid(s)totheCommissionforApproval.TheAgencywillalsoprovidetheCommissionwithinformationaboutallbidsreceived.TheselectionprocessisexpresslyexemptedfromtheIllinoisProcurementCode.401

TheIllinoisSolarforAllProgramAdministrator(s)willatminimum:

Verify project eligibility in Illinois Solar for All and coordinate this informationwith theAdjustableBlockProgramAdministrator(whowillprocesstheactualapplicationmaterials).Thiswillinclude,butisnotlimitedto,incomeverification,reviewofcommunityinvolvementinprojects,reviewofjobtrainingcoordination,andreviewofIllinoisSolarforAllconsumerprotectionssuchasverificationofensuringtangibleeconomicbenefitsflowtolowincomeparticipants.

Act as the centralized source for income verification and maintain database of programparticipants.

Assist inthedevelopmentofcontracts,disclosureforms,andbrochures forusebyIllinoisSolarforAllApprovedVendorsandtheirpartnercommunity‐basedorganizations.

Coordinatethedistributionoffundingforgrass‐rootseducationeffortsbycommunity‐basedorganizations. ApriorityforthisfundingwillbetopromotetheavailabilityoftheIllinois

40020ILCS3855/1‐56(b)(5).40120ILCS3855/1‐56(f).


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SolarforAllPrograminEnvironmentalJusticeCommunitiestoachievethegoalof25%oftheincentivesbeingallocatedtothosecommunities.

FacilitateIllinoisSolarforAllApprovedVendorsmeetingtheadditionalrequirementsoftheIllinoisSolarforAllProgram.Inparticular,theProgramAdministratorwillactasaliaisonbetween Illinois Solar for All Approved Vendors participating in the programs andorganizationsproviding jobtraining.TheProgramAdministratorwillalsoworkto informIllinoisSolarforAllApprovedVendorsofenergyefficiency,weatherization,leadabatement,andotherprogramopportunitiesthatcouldprovideadditionalbenefitstoparticipants.

Provide guidance and education to Illinois Solar for All Approved Vendors, communitygroups, local government agencies, and others on how to leverage other governmentalpolicies to facilitate low‐income solar projects and energy efficiency programs. Otherrelevantpoliciesincludeaffordablehousing,economicdevelopment,publicfinance,andtaxpolicies,atthefederal,state,andlocallevel.TheAdministratorwillactasliaisonwithothergovernmental agencies that administer such programs to facilitate their use on solardevelopment.

DevelopProgramManual and relatedmaterials for use by Illinois Solar forAll ApprovedVendors.

ProvidereportstotheAgencyandtheCommissiononaquarterlybasisonthestatusoftheProgram including, but not limited to, number of applications received, number ofapplications approved, number of projects completed, REC payments, payments for andstatusofgrassrootseducationefforts(ifapplicable),andasummaryoftechnicalassistanceprovided.

8.9. QualityAssuranceDuetothehigherleveloftotalincentivesthatIllinoisSolarforAllprojectswillreceivecomparedtothosethatparticipatesolelyintheAdjustableBlockProgram,aswellastheadditionalvulnerabilitiesthatprogramparticipantsmayface,itisespeciallyimportantfortheAgencytoensurethatprojectsare properly installed and produce their expected amounts of energy. In conjunction with theProgramEvaluator(asdescribedinSection8.17),theIllinoisSolarforAllProgramAdministratorwill develop and implement a process for quality assurance, including thorough photodocumentationofallprojectswhileunderconstruction,andon‐siteinspectionofarandomsampleof installations. If installations are found to have deficiencies, the Illinois Solar for All ApprovedVendor,atitsownexpense,willberesponsibleforanyrepairs,alterations,oradditionstoremedythedeficiencies.IllinoisSolarforAllApprovedVendorswhohaveadisproportionatelyhighnumberofdeficientsystemsmaylosetheireligibilitytocontinuetoparticipateintheIllinoisSolarforAllProgram.

8.10. CoordinationwithJobTrainingProgramsTheIllinoisSolarforAllProgram’sorganizingstatutecontainstwoprovisionsthataredesignedtoensure that the job trainees supportedby theComEd job trainingprograms402 establishedunderSection16‐108.12ofthePublicUtilitiesActparticipateintheinstallationofphotovoltaicprojects

402ComEd’sjobtrainingimplementationplanwasapprovedbytheCommissiononSeptember27,2017inDocketNo.17‐0332.


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supportedbytheprogram.Thefirstoftheserequirementsisaspirationalinnature,whilethesecondismorespecific.

Thefirstprovisionisthat,“[p]rojectsmustincludejobtrainingopportunitiesifavailable,andshallendeavortocoordinatewiththejobtrainingprogramsdescribedinparagraph(1)ofsubsection(a)of Section 16‐108.12 of the PublicUtilitiesAct.”403 This program is known as the “solar trainingpipelineprogram.”Underthisprovision,ComEdistospend$3,000,000ineachof2017,2021,and2025totraininstallersforthesolarprojectsauthorizedandcontemplatedundertheSolarforAllprogramandotherRPSprograms.Thejobtrainingprogramistobe“designedtoensurethatentitiesthatoffer trainingare located in,andtraineesarerecruited from, thesamecommunities that theprogramaimstoserveandthattheprogramprovidestraineeswiththeopportunitytoobtainreal‐worldexperience.”404

The availability of job training opportunities for Solar for All projects depends, in part, on theavailabilityofgraduatesofthesolartrainingpipelineprogram.ComEd’sRequestforProposalsfrompotentialtrainingproviderswasissuedAugust1,2017andremainedopenuntilSeptember30,2017.TheRFPemphasizestheneedfortrainingproviderstoincludetraineerecruitment,substantivesolarindustry training, and post‐training opportunities.405 Moreover, ComEd has committed “tocoordinatewiththeIllinoisPowerAgencyoritsadministratorofIllinoisSolarforAll.”406

The second relevant provision governing the Solar for All Program is that for the Low‐incomeDistributedGenerationIncentive,“[c]ompaniesparticipatinginthisprogramthatinstallsolarpanelsshallcommittohiringjobtraineesforaportionoftheirlow‐incomeinstallations”andfurtherthat,“anadministratorshallfacilitatepartneringthecompaniesthatinstallsolarpanelswithentitiesthatprovidesolarpanelinstallationjobtraining.”407

TheActdoesnotspecifywhatismeantby“aportion”andalsodoesnotdefinewhowouldqualifyasa“jobtrainee”incontrastwiththepriorprovisionthatspecificallytiesittothesolartrainingpipelineprogram.TheAgencynotesthatSection16‐108.12ofthePublicUtilitiesActnotonlycreatesthesolartrainingpipelineprogramdescribedabovebutalsocreatesa“craftapprenticeshipprogram”andasetofsix“multi‐culturaljobsprograms.”TheAgencyinfersthatgraduatesofthoseprogramscouldreasonablybeconsidered“jobtrainees”forthepurposesoftheLow‐incomeDistributedGenerationIncentivewithinSolarforAll.

ComEdhasstatedintherecentICCproceedingreviewingitsSection16‐108.12jobstrainingprogramthat it intends to implement the Solar Craft Apprenticeship Program in coordination with theInternational Brotherhood of Electrical Workers (“IBEW”) Local 134, which will integrate solartrainingcurriculaintoitsexistingelectricalcraft/trade/skillapprenticeshipprogramsat18IBEWsitesaswellascertaincommunitycollegesandhighschools.408AccordingtothePlansubmittedbyComEd in that proceeding, the Solar Craft Apprenticeship Program appears to include training

40320ILCS3855/1‐56(b)(2).404220ILCS5/16‐108.12(a)(1).405ICCDocketNo.17‐0332,ComEdEx.1.0(http://www.icc.illinois.gov/downloads/public/edocket/451215.pdf)at8.406ICCDocketNo.17‐0332,ComEd/EDF/ELPC/LVEJOJointInitialCommentsat5.40720ILCS3855/1‐56(b)(2)(A).408ICCDocketNo.17‐0332,ComEdEx.1.0at12.


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locationslocatedacrosstheentireState,andnotjustinComEd’sserviceterritory.409ThisprogrammaybeessentialforensuringtheavailabilityofjobtraineesacrosstheState.

Toensurethat“aportion”ofprojectsusejobtrainees,theAgencyproposesthatIllinoisSolarforAllApprovedVendorswhoparticipateintheIllinoisSolarforAllprogramshoulddemonstratethatatleast33%ofprojects(onarollingaveragebasis)includetheuseofoneormorejobtraineesfromthesolar training pipeline program, the craft apprenticeship program, or the multi‐cultural jobsprogram.Furthermore,eachIllinoisSolarforAllApprovedVendorwillhavetodemonstratethatfortheirfirstyearofparticipation,10%ofthehoursworkedonprojectswillbebyjobtrainees,andthatamountwouldincreaseto20%intheirsecondyearofparticipation,and33%inthethirdyear.

IllinoisSolarforAllApprovedVendorswillberequiredtodocumenttheuseofjobtrainees,andtoprovide a summary of their work to the Program Administrator. Illinois Solar for All ApprovedVendorsmayalsorequesttousejobtraineesfromotherjobtrainingprogramssolongastheycandemonstrate that completion of the job training programwould lead to the trainee becoming a“QualifiedPerson”underthePart461Rulerelatedtothecertificationofinstallersofphotovoltaicsystems (see Section 2.3.2.4 for additional discussion of these requirements). The Agency willconsiderrequestsforwaiversofthisrequirementonacasebycasebasisifanIllinoisSolarforAllApprovedVendorcandemonstratethatjobtraineesarenotavailableintheareawhereprojectsarebeinginstalledandthiswouldpreventtheprojectfrombeingcompleted.

The Illinois Solar for All Program Administrator will coordinate with the entities providing jobtrainingtomaintainaclearinghouseofinformationthatIllinoisSolarforAllApprovedVendorscanusetoidentifypotentialjobtrainingprogramgraduatestohire.

TheAgencyanditsProgramAdministrator(s)willnotrunthejobtrainingprograms,andtherefore,theAgencyhas limitedabilitytoensurethesuccessofthoseprogramsineffectivelytrainingnewworkers. Rather, the Agency will seek to ensure that the Illinois Solar for All Program createsemploymentopportunitiesforthosenewworkers.

8.11. AdditionalRequirementsforApprovedVendorsTheIllinoisSolarforAllProgram(otherthantheLow‐incomeCommunitySolarPilotProjects)workssimilarly to theAdjustableBlockProgram,and thereforeparticipation in the IllinoisSolar forAllProgramwill be coordinated through Illinois Solar for All Approved Vendorswho are approvedthroughtheprocessoutlinedinSection6.9.ApprovedVendorswhohaveprojectsthattheywishtohaveparticipateinIllinoisSolarforAllwilladditionallyhavetoregisterwiththeIllinoisSolarforAllProgramandagreetoadditionaltermsandconditionsinordertobecomeanIllinoisSolarforAllApprovedVendor.410AnApprovedVendorthatdoesnotdosowillnotbeeligibletohaveprojectsparticipate in, and receive incentives from, the Illinois Solar for All Program. The Agency willmaintainonitswebsitelistsofApprovedVendorsthatwill indicatewhichApprovedVendorsarealsoregisteredtoparticipateintheIllinoisSolarforAllProgram.

TheadditionalrequirementsforregisteringtobeanIllinoisSolarforAllApprovedVendorinclude:

Descriptionofplansforcommunityinvolvementinprojects(whereapplicable)409Id.at13.410ThisincludestheoptiontobeanIllinoisSolarforAllSingleProjectApprovedVendorsimilartotheAdjustableBlockProgramSingleProjectApprovedVendoroption.Theminimumprojectsizewouldbe50kW.


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Planforinclusionofjobtrainingopportunities ForprojectsthatreceivetheLow‐incomedistributedgenerationincentive,acommitmentto

hirejobtraineesforaportionoftheprojectsasdescribedinSection8.10 CoordinationwiththeProgramAdministratoronincomeverification AgreementtoallowtheAgencytoreviewandapprovemarketingmaterialsgearedtowards

theIllinoisSolarforAllProgram AgreementtoensureadditionalconsumerprotectionsasdescribedinSection8.14 Demonstration that for low‐income distributed generation and community solar projects

thatparticipantsdonothaveanyup‐frontpayments.

TheActprovidesthat“[p]riorityshallbegiventoprojectsthatdemonstratemeaningfulinvolvementof low‐income community members in designing the initial proposals” and that “[a]cceptableproposals to implement projects must demonstrate the applicant's ability to conduct initialcommunityoutreach,education,andrecruitmentoflow‐incomeparticipantsinthecommunity.”411TheAgencyunderstandshowtheseprovisionsmayapplytocommunitysolarprojectsthroughtherequirement to identifypartnershipswithcommunitystakeholders,but it is lessclearhowthoseprovisionswouldapplydirectly toprojects thatparticipate ineither theLow‐IncomeDistributedGenerationIncentiveortheIncentivesforNon‐profitsandPublicFacilities.

Tomeettheintentoftheseprovisions,theregistrationprocessfortheIllinoisSolarforAllProgramwillrequireIllinoisSolarforAllApprovedVendorstodemonstratetheircapacitiesinthisarea.AnIllinoisSolarforAllApprovedVendorwillbeabletodosoby:

Providingnarrativesummaryofeffortstakenpriortotheapplicationtoconductcommunityoutreach,education,andrecruitment

Listingcommunity‐basedorganizationstheapplicanthaspartneredwith, includinglettersfromthoseorganizationstoverifythepartnerships

Describingindetailongoingplansforcommunityoutreach,education,andrecruitment Describingstaffingfordedicatedoutreach,education,andrecruitment Describingplansforensuringthattangibleeconomicbenefitsflowtoprogramparticipants Participate in trainingofferedby theProgramAdministratoronguidelines formarketing,

contracting,andstandarddisclosuresforprogramparticipants

FailuretomaintainademonstratedcommitmenttotheserequirementswillresultinanIllinoisSolarforAllApprovedVendorbeingremovedfromparticipatingintheIllinoisSolarforAllProgram.

8.12. ApplicationProcessExceptforLow‐IncomeCommunitySolarPilotProjects,theprocessforaprojecttobesubmittedtotheIllinoisSolarforAllProgramwillmirrorthatfortheAdjustableBlockProgram.Projectswillbesubmitted by Illinois Solar for All Approved Vendors through the same batch process as theAdjustableBlockProgrambuttheminimumbatchsizewillbe50kW.TherewillnotbeanapplicationfeeforIllinoisSolarforAllprojects.

TheapplicationwillindicatethatthebatchofprojectsisforIllinoisSolarforAllandwillprovidethesupplementalinformationrequiredforthoseprojectsinadditiontoalltheinformationthatwouldbe required for an Adjustable Block Program project. If the supplemental information does not41120ILCS3855/1‐56(b)(2).


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demonstrate that the project qualifies for participation in the Illinois Solar for All Program, theproject may still be eligible to participate in the Adjustable Block Program through a separateapplication(includingthepaymentofanapplicationfee).

LikefortheAdjustableBlockProgram,IllinoisSolarforAllprojectswillbebundledintoonecontractforeachapprovedbatch.TheAgencywillrequestCommissionapprovalforcontractsthatincludeadditional IllinoisSolarForAllprovisions.ThosecontractswillbeexecutedfirstbytheAgency iffundsareavailablefromtheRenewableEnergyResourcesFund.Shouldthosefundsnotbeavailable(eitherduetotheannualbudgetbeingexpended,orthelackofanannualapprovedappropriation),thencontractswillbeallocatedtooneoftheutilities.Forthosecontractsallocatedtoautility,theProgramAdministratorwillstrivetoallocatecontractstoeachutility forprojects intheirserviceterritory,andalsoinamannerthatwillobligatefundsatalevelconsistentwitheachutility’sshareoffundscommittedtoIllinoisSolarforAll.

For Low‐Income Community Pilot Projects, the application process will take place throughregistering for, thenbidding in, the competitive procurement for thoseprojects. The approval ofcontracts by the Commissionwill take the form of the Commission approving the results of thecompetitiveprocurement.

8.13. CustomerEligibilityCustomer eligibility for the Illinois Solar for All Program is partly defined in the Act. Furtherrefinementsareproposedinthissection.

8.13.1. IncomeGuidelinesTheActstatesthatfortheIllinoisSolarforAllProgram,“’low‐incomehouseholds’meanspersonsandfamilieswhoseincomedoesnotexceed80%ofareamedianincome,adjustedforfamilysizeandrevisedevery5years.”412

TheAgencyproposestouseincomeeligibilityguidelinesfromHUD.HUDbasesitshousingassistanceprograms,suchastheSection8HousingChoiceVoucherprogramon80%ofareamedianincome,adjustedforfamilysize.413

BecausetheActdoesnotdefine“area,”theAgencyisproposingtouseHUD’sdefinitionofanareaasaMetropolitanStatisticalArea(MSA),aFairMarketRate(FMR)Area,oracountynotinanMSAorFMR.Thereare20MSAsandFMRs,and62othercountiesinIllinois.

EligibilitylevelsforIllinoisSolarForAll,basedon2017HUDguidelinesforeveryareaandadjustedforfamilysize,arepresentedinAppendixF.

ForFiscalYear2017,theHUDeligibilityincomelimitsforIllinoisasawholeareshowninthetablebelow.Forexample,afamilyoffourwouldbeconsidered“low‐income”iftheirhouseholdincomewerelessthan$59,300.(Actualeligibilitydependsonincomeforanarea,ratherthanforthestateas

41220ILCS3855/1‐56(b).413HUD,FY2017IncomeLimitsDocumentationSystemathttps://www.huduser.gov/portal/datasets/il.html.


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awhole.) HUDhasotherprogramsthatuse“verylow”and“extremelylow”incomemeasures,at50%and30%ofAMIthatareprovidedhereforreference.414

Table8‐7:HUDIncomeLimits

HUDStateIncomeLimits:IllinoisFY2017

Medianfamilyincome(MFI)=$74,100

Personsinhousehold

1 2 3 4 5 6 7 8

30%ofmedian(“extremelylowincome”)

$15,550 $17,800 $20,000 $22,250 $24,000 $25,800 $27,550 $29,350

50%ofmedian("verylowincome")

$25,950 $29,650 $33,350 $37,050 $40,000 $43,000 $45,950 $48,900

80%ofmedian("lowincome")

$41,500 $47,400 $53,350 $59,300 $64,000 $68,750 $73,500 $78,250

Itshouldbenotedthatotherlow‐incomeenergyprograms,suchastheIllinoisHomeWeatherizationAssistanceProgram(“IHWAP”)andtheLow‐IncomeHomeEnergyAssistanceProgram(“LIHEAP”)arebasedonthefederalpovertylevel,notareaincome,withstate‐widevalues.Eligibleguidelinesaresetforhouseholdswithincomebelow200%and150%ofthefederalpovertylevel,dependingon the program. Eligibility guidelines for Illinois are set by the Department of Commerce andEconomicOpportunity,andareshowninTable8‐8.415

Table8‐8:EligibilityGuidelinesforLIHEAPandWAPinIllinois

2017IllinoisLIHEAPeligibility 2018 IHWAPIncomeEligibilityGuidelines

HouseholdSize

30DayIncome

Annualincome(150%ofFPL)

StateFunds(150%ofFPL)

Federal Funds(200%ofFPL)

1 $1,508 $18,090 $18,090 $24,120

2 $2,030 $24,360 $24,360 $32,480

3 $2,553 $30,630 $30,630 $40,840

4 $3,075 $36,900 $36,900 $49,200

5 $3,598 $43,170 $43,170 $57,560

6 $4,120 $49,440 $49,440 $65,920

7 $4,643 $55,710 $55,710 $74,280

8 $5,165 $61,980 $61,980 $82,640

InallregionsofIllinois,150%ofthefederalpovertylevelislowerthan80%ofAMIforallhouseholdsizes.Thus,allhouseholdseligibleforLIHEAParealsoeligibleforIllinoisSolarForAll.Households

414 https://www.huduser.gov/portal/datasets/il/il17/State‐Incomelimits‐Report‐FY17.pdf. For metropolitan area and county levelincomelimits,see:https://www.hudexchange.info/resource/reportmanagement/published/HOME_IncomeLmts_State_IL_2017.pdf.415IllinoisDepartmentofCommerceandEconomicOpportunity,“CommunityAssistance,EnergyEfficiencyandInfrastructure,”https://www.illinois.gov/dceo/CommunityServices/Pages/default.aspx.AccessedSeptember2017.


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participatinginIHWAPusingstatefundsarealsoeligible,whilethoseusingFederallyfundedIHWAP(200%ofFPL)maybeeligibleinsomeareasofthestateandsomehouseholdsizes,butnotothers.The tables inAppendixFcompareHUDeligibility levels toLIHEAPand IHWAP incomeeligibilitylevels.

Anotherapproachtoidentifyinglow‐incomecustomers,bygeographicarearatherthanbyindividualhouseholdincome,istouseHUD’s“QualifiedCensusTracts”whichareusedtodefineeligibilityfortheLow‐IncomeHousingTaxCredit (LIHTC).416QualifiedCensusTractsmusthave50percentofhouseholdswith incomes below 60 percent of the AreaMedian Gross Income (AMGI) or have apovertyrateof25percentormore.

HUDhasidentifiedandmappedQualifiedCensusTracts(“QCT”)nationwide.Overall,thereare657QCTsinmetropolitanareasinIllinoisand49innon‐metropolitanareas(outof3,123totalcensustractsinIllinois).CookCountyhasthelargestportionwith441.Springfield,whichhas15QCTs,isshowninFigure8‐1asanexample.

TheAgencyproposestouseQCTsasastreamlinedmethodfordeterminingeligibilityforlow‐incomecommunitysolarcustomers,asdiscussedinthenextsection.

Figure8‐1:SpringfieldQualifiedCensusTracts

Source:HUD,https://www.huduser.gov/portal/sadda/sadda_qct.html

416HUD,“QualifiedCensusTractsandDifficultDevelopmentAreas,”websiteaccessedJuly19,2017.https://www.huduser.gov/portal/datasets/qct.html


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8.13.2. DeterminingIncomeEligibilityTheAgencyproposesseveralapproachestodeterminingincomeeligibilityfortheIllinoisSolarforAllProgram.

For projects that participate in the Low‐income Distributed Generation Incentive Program,verificationofincomeshouldbedoneatthehouseholdlevel.Thiscanbedoneinanumberofways.

For buildingswith between one and four units household income can be verified by one of thefollowingmeans:

Reviewofthemostrecentfederalincometaxreturns Incomeverificationthroughathird‐partyincomeverificationsystem Verification of participation in another low‐income energy program (such as LIHEAP or

IHWAP), in HUD’s housing assistance programs where the income eligibility standard islowerthan80%ofAMIforthatparticipant,orinotherbenefitsprogramswheretheincomeeligibilityislowerthan80%ofAMI.

Fortwotofourunitbuildings,atleasttwoofthehouseholdsinthebuildingmustqualify.Foramulti‐family building (five or more units), either at least 50% of the householdsmust qualify, or thebuilding owner may demonstrate that the building meets the definition of “affordable housing”containedintheIllinoisAffordableHousingAct,namely:

“Affordablehousing’meansresidentialhousingthat,solongasthesameisoccupiedbylow‐incomehouseholdsorvery low‐incomehouseholds,requirespaymentofmonthlyhousing costs, including utilities other than telephone, of nomore than 30% of themaximumallowableincomeasstatedforsuchhouseholdsasdefinedinthisSection.417

In addition, participation in energy efficiency programs that also have an income eligibilityrequirementthatisequaltoorlessthan80%ofAMImayalsobeconsideredameansofqualifyingamultifamilybuilding.

For community solar projects, the Agency recognizes that transaction costs of proving incomeeligibilitycomparedtothevalueoftheincentivemaybehigherthanforaninstallationofaprojecton‐site,andthereforeproposesastreamlinedincomeverificationapproach.

Asubscribercanbeverifiedaslow‐incomeviathesameprovisionsusedfortheLowIncomeDistributedGenerationIncentive.

Asubscribercanbeverifiedaslow‐incomeiftheyresideinaHUDQualifiedCensusTractandprovideasignedaffidavitthattheymeettheincomequalificationlevel.418

Itwillbe theresponsibilityof the IllinoisSolar forAllApprovedVendor to tracksubscribersanddocument incomeeligibility for community solarprojects.ApprovedVendorswill be required toreporttotheAgencyonsubscriptionratesonceayear.IllinoisSolarforAllApprovedVendorswill

417See310ILCS65/3(e).Notethatthedefinitionoflow‐incomehouseholdcontainedinthatActmirrorsthedefinitionusedforIllinois‐SolarforAll,andthatverylow‐incomehouseholdshaveanincomestandardthatisevenlower.418TheAgencywillmonitortheuseofthisprovisionandmayconsidermodifyingtheconsiderationofeligiblecensustracts(forexampletocensustractswhereatleast50%ofhouseholdsarebelow80%ofAMI)iftheproposeduseoftheQCTapproachappearstobeabarriertofacilitatingsubscriptionverification.


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not be required to verify that existing subscribers continue to meet the low‐income eligibilityrequirements,butnewsubscribersovertimewillberequiredtomeetthoserequirements.

8.14. ConsumerProtectionsThe Agency believes that it has proposed a strong set of consumer protections as part of theAdjustableBlockProgramforbothdistributedgenerationandforcommunitysolar(seeSections6.13and7.6.2).TheseprotectionswillalsoapplytotheIllinoisSolarforAllProgram.ButseveralfactorsleadtheAgencytoproposeadditionalconsumerprotectionsfortheIllinoisSolarforAllProgram.InordertobeanIllinoisSolarforAllApprovedVendorfortheSolarForAllprogram,IllinoisSolarforAllApprovedVendorsmustagreetothefollowingadditionalprovisionsforlow‐incomecustomers.

Inorderto“ensuretangibleeconomicbenefitsflowdirectlytoprogramparticipants,”IllinoisSolar forAllApprovedVendorsmustalsoverify that for residentialprogramparticipantstherearenoup‐frontpaymentsfordistributedgenerationprojects,orup‐frontsubscriptionfeesforcommunitysolarprojects.IllinoisSolarforAllApprovedVendorsmustalsoprovidedocumentation to both the program participant(s), and to the Program Administratorexplaininghowtheprojectorcommunitysolarsubscriptionwillresultinacash‐flowpositiveexperiencefortheparticipant(s)(includinganestimateofthemonthlysavings).

For distributed generation projects, a roof inspection report is required to ensure thatprojects are being installed on roofs thatwill not need substantial repairs. If repairs areneeded,theIllinoisSolarforAllApprovedVendormustidentifytheplanfortherepairsandhowtheywillbepaidfor,ensuringthatsuchcostsdonotplaceanunsustainablefinancialburdenontheparticipant.

ContractsbetweenIllinoisSolarforAllApprovedVendors(ortheirsub‐contractedinstallers)andprogramparticipantsforLowIncomeDistributedGenerationprojectswillberequiredtooffercleardisclosureofthecostssevendaysbeforeconsummationofthetransaction,andtherighttocancelthetransactionwithinsevenbusinessdaysafterconsummation.

Financingamounts,terms,andconditionsmustbebasedonanassessmentoftheprogramparticipant’sabilitytorepaythedebt,asdefinedbyRegulationZ,whichisafederalrulethatimplementsaspectsoftheTruthinLendingActandtheDodd‐FrankAct.419

Forlow‐incomecustomers,loansshouldnotbesecuredbytheprogramparticipant’shomeorhomeequity.Whilesuchunsecuredloansmayentailahigherinterestrate,especiallyforcustomerswith low credit scores or little credit history, they avoid the risk of liens andforeclosuresforcustomerswhodefaultontheirloans.420

419SeeConsumerFinancialProtectionBureau,April10,2013.Ability‐to‐RepayandQualifiedMortgageRule,SmallEntityComplianceGuide,http://files.consumerfinance.gov/f/201304_cfpb_compliance‐guide_atr‐qm‐rule.pdf. Under the regulation (12C.F.R.§ 1026.43, issuedunderauthorityof15U.S.C.§1639c),creditorsgenerallymustconsidereightunderwritingfactors:(1)currentorreasonablyexpectedincomeorassets;(2)currentemploymentstatus;(3)themonthlypaymentonthecoveredtransaction;(4)themonthlypaymentonanysimultaneousloan;(5)themonthlypaymentformortgage‐relatedobligations;(6)currentdebtobligations,alimony,andchildsupport;(7)themonthlydebt‐to‐incomeratioorresidualincome;and(8)credithistory.420Forexample,theIllinoisEnergyEfficiencyLoanProgramoffersunsecuredloansatmoderateinterestratesthroughon‐billfinancing,butisonlyavailableforcertainenergyefficiencymeasures.See:http://programs.dsireusa.org/system/program/detail/5152.


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Contracts for financial productsmust offer terms that include forbearance. If a programparticipant can show good cause in a request for forbearance, financers must offer a)suspensionoftotalpaymentsforuptothreemonths,b)asuspensionofinterestpaymentsforup to sixmonths,or c) a reduction in interest rates forup to twelvemonths. Missedrevenuesmayberecoveredlaterinthestageofthecontract,butnointerestmaybeapplied.

Contractsmaynotincludeprepaymentpenalties.

Marketingandcontractualmaterialsmustbeinthelanguagerequestedbythecustomer.

8.15. EnvironmentalJusticeCommunitiesTheAct directs theAgency to define and provide special consideration to Environmental JusticeCommunitiesinimplementingtheIllinoisSolarForAllprogram.TheActsetsasagoalthatatleast25%offundsfortheLow‐IncomeDistributedGenerationIncentive,theincentivesfornon‐profitandpublic facilities, and Low Income Community Solar projects “be allocated to projects located inenvironmental justice communities.”421 (The provision does not apply to the Low‐IncomeCommunitySolarPilotProjects,whicharecompetitivelybid.)

Thefollowingsectionsproposedefinitionsofterms,amethodologyfordeterminingwhichIllinoiscommunities shouldbeconsideredEnvironmental JusticeCommunities, andhowtheAgencywillimplementtherelevantprovisionsoftheAct.WhenthisPlanisapprovedbytheCommission,theAgencywillconsultwithstakeholdersandrelevantstateagencies,includingtheIllinoisCommissiononEnvironmental Justice and the IllinoisEnvironmentalProtectionAgency (“IEPA”), to establishspecificvaluesanddesignatespecificcommunitiesasEnvironmentalJusticeCommunities.

8.15.1. DefinitionsTheActstatesthat“theAgencyshalldefine‘environmentaljusticecommunity’aspartoflong‐termrenewable resources procurement plan development, to ensure, to the extent practicable,compatibilitywithotheragencies’definitionsandmay,forguidance,looktothedefinitionsusedbyfederal,state,orlocalgovernments.”Theterm“environmentaljustice”isnotdefinedintheActorinother Illinois statutes, but it is helpful to define “environmental justice” in order to define“environmentaljusticecommunities.”

The Environmental Justice Act, the 1997 legislation that created the Illinois Commission onEnvironmentalJustice(415ILCS155),foundthat:

(i)theprincipleofenvironmental justicerequiresthatnosegmentofthepopulation,regardlessofrace,nationalorigin,age,orincome,shouldbeardisproportionatelyhighoradverseeffectsofenvironmentalpollution;(ii)certaincommunitiesintheStatemaysufferdisproportionatelyfromenvironmentalhazardsrelatedtofacilitieswithpermitsapprovedbytheState;and(iii)theseenvironmentalhazardscancauselong‐termhealtheffects.422

42120ILCS3855/1‐56(b)(2)(A),(B),(C).422415ILCS155/5.


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TheIllinoisEPAdefinestheterm"environmentaljustice"asfollows:

"Environmental Justice" isbasedontheprinciplethatallpeopleshouldbeprotectedfromenvironmentalpollutionandhavetherighttoacleanandhealthyenvironment.Environmental justice is theprotectionof thehealthof thepeopleof Illinoisand itsenvironment,equityintheadministrationoftheState'senvironmentalprograms,andtheprovisionofadequateopportunitiesformeaningfulinvolvementofallpeoplewithrespecttothedevelopment,implementation,andenforcementofenvironmentallaws,regulations,andpolicies.423

The Illinois EPA has also defined a “potential environmental justice community” based ondemographicfactors,butnotenvironmentalfactors:

A “potential” EJ community is a community with a low‐income and/or minoritypopulationgreaterthantwicethestatewideaverage.Inaddition,acommunitymaybeconsideredapotentialEJcommunityifthelow‐incomeand/orminoritypopulationislessthantwicethestatewideaveragebutgreaterthanthestatewideaverageandthathasidentifieditselfasanEJcommunity.Ifthelow‐incomeand/orminoritypopulationpercentageisequaltoorlessthanthestatewideaverage,thecommunityshouldnotbeconsideredapotentialEJcommunity.424

TheUnitedStatesEnvironmentalProtectionAgencydefinesan“overburdenedcommunity”underbothsocialandenvironmentaltermsas:

Minority,low‐income,tribal,orindigenouspopulationsorgeographiclocationsintheUnitedStates thatpotentiallyexperiencedisproportionateenvironmentalharmsandrisks.Thisdisproportionalitycanbeasaresultofgreatervulnerabilitytoenvironmentalhazards, lack of opportunity for public participation, or other factors. Increasedvulnerabilitymaybeattributable toanaccumulationofnegativeor lackofpositiveenvironmental, health, economic, or social conditions within these populations orplaces. The term describes situations where multiple factors, including bothenvironmentalandsocio‐economicstressors,mayactcumulativelytoaffecthealthandtheenvironmentandcontributetopersistentenvironmentalhealthdisparities.425

Both the IEPA and US EPA have developed analytical tools based on their definitions of EJcommunities.TheIEPA’sEJSTARTisaGeographicInformationSystemsdemographicscreeningtooldevelopedby IEPAstaff that identifiesregionswithhighminoritypopulationand/or low‐incomepopulation.IEPAalsoaddsaone‐milebufferaroundeachregulatedfacilityasasimplifiedwaytoidentify potential local environmental impacts. It draws from the Census Bureau’s AmericanCommunitySurvey5‐yearestimates(2011‐2015)andisupdatedannually.

TheUSEPAtooliscalledEJSCREEN.426Itusesstandardandnationally‐consistentdatatoidentifycommunitieswithgreaterriskofexposuretopollutionbasedon11environmentalindicatorsthatmeasure potential exposure, hazard/risk and proximity, including traffic proximity, particulate423 Illinois EPA web site, “Environmental Justice Policy,” http://www.epa.illinois.gov/topics/environmental‐justice/ej‐policy/index.AccessedJuly19,2017.424Id.425USEPA,“EJ2020Glossary,”https://www.epa.gov/environmentaljustice/ej‐2020‐glossary.AccessedJuly19,2017.426See:https://ejscreen.epa.gov/.


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matter,andproximitytosuperfundsites.TheseindicatorsarecombinedwithdemographicdatafromtheCensusBureau,enablinguserstoidentifyareaswithminorityorlow‐incomepopulationswhoalsofacepotentialpollutionissues.

Whilethesetoolsareuseful,theydonotholisticallyaddressallaspectsofenvironmentaljustice.Forexample,EJSCREENevaluatesindividualenvironmentalindicatorsbutdoesnotlookatcumulativeimpacts.

The most rigorous tool for analyzing impacted communities is the California CommunitiesEnvironmentalHealthScreeningTool(CalEnviroScreen)fromtheCaliforniaOfficeofEnvironmentalHealthHazardAssessment(OEHHA).427CalEnviroScreencompilesdataon12indicatorsofpollutionburdenand8populationcharacteristicscollectedattheCensustractlevel.Itthenweightscertainfactorstodevelopascoreforeacharea.Highscoringareasarethenconsideredeligibleforanumberofstatepolicies,includingdispositionofsomeoftherevenuesfromthestatecap‐and‐tradeprogramcreatedunderAssemblyBill32.

Table8‐9:SummaryofCalEnviroScreen3.0IdentificationMethodology

PollutionBurden PopulationCharacteristics

Exposures Sensitivepopulations

OzoneConcentrationsPM2.5ConcentrationsDieselPMEmissionsDrinkingWaterContaminantsPesticideUseToxicReleasesfromFacilitiesTrafficDensity

AsthmaEmergencyDepartmentVisitsLowBirthWeightInfantsCardiovasculardisease(emergencydepartmentvisitsforheartattacks)

Environmentaleffects Socio‐economicindicators*

CleanupSitesGroundwaterThreatsHazardousWasteImpairedWaterBodiesSolidWasteSitesandFacilities

EducationalAttainmentHousingburdenedlowincomehouseholdsLinguisticIsolationPovertyUnemployment

Source:OEHHA.*CalifornialawprohibitstheuseofraceasafactorinCalEnviroScreen.

The CalEnviroScreen approach is an attractive way to consider defining environmental justicecommunitiesbuttheAgencynotesthatthedevelopmentofitwasamulti‐year,multi‐milliondollarundertaking. Therefore, the Agency proposes a streamlined approach that takes the concept ofCalEnviroScreenandsimplifiesitforuseinIllinoisthroughtheuseofreadilyavailabledatafromtheU.SEPA’sEJSCREENtool.CalEnviroScreendoesnotaccountforraceinitscalculations,butbyusingdatafromEJSCREENtheAgencywillbeabletodoso.

427CaliforniaOfficeofEnvironmentalHealthHazardAssessment(“OEHHA”),CaliforniaCommunitiesEnvironmentalHealthScreeningTool(CalEnviroScreen),https://oehha.ca.gov/calenviroscreen/report/calenviroscreen‐version‐20


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8.15.2. ProposedApproachforDefiningEnvironmentalJusticeCommunities

The Agency proposes to determine Environmental Justice Communities by analyzing data fromIllinois census block groups for the following environmental and demographic indicators, asdescribedbytheEJSCREENTool:428

National‐ScaleAirToxicsAssessment(NATA)airtoxicscancerrisk NATArespiratoryhazardindex NATAdieselPM Particulatematter Ozone Trafficproximityandvolume Leadpaintindicator ProximitytoRiskManagementPlansites ProximitytoHazardousWasteTreatment,StorageandDisposalFacilities ProximitytoNationalPrioritiesListsites WastewaterDischargersIndicator

ThefollowingdemographicindicatorsarealsousedbyEJSCREEN:429

PercentLow‐Income PercentMinority Lessthanhighschooleducation Linguisticisolation Individualsunderage5 Individualsoverage64

Inaddition,theAgencywillconsiderincludingthefollowingindicatorsthatusedatanotcontainedinEJSCREEN.ThesearenotavailableatthesamelevelofdetailastheindicatorsusingdatafromEJSCREEN(moretypicallytheyhavedataatthezipcodeorcountylevel),andasthesewouldneedtobe translated to the block group level, the Agency will assess in the final methodology if theseindicatorsprovidemeaningfulimpactontheevaluationcriteria.

The following demographic indicators for Sensitive Population Characteristics from the IllinoisDepartmentofPublicHealth.

AsthmaEmergencyDepartmentVisits LowBirthWeightInfants

ThefollowingenvironmentalindicatorsfromtheIllinoisEnvironmentalProtectionAgency.

DrinkingWaterWatch Siteremediationprogram LeakingUndergroundStorageTankIncidentTracking StateResponseActionProgram

428Seehttps://www.epa.gov/ejscreen/overview‐environmental‐indicators‐ejscreen.429Seehttps://www.epa.gov/ejscreen/overview‐demographic‐indicators‐ejscreen.


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SolidWasteFacilities

TheAgencywouldthenweighteachfactorusinganapproachadaptedfromCalEnviroScreen:Censusblock groups would be ranked for each environmental and demographic indicator, a resultingpercentile score would found for each census block group, and the percentile scores would beaveraged, resulting in an environmental and demographic score for each block group. The twoaverageswouldbymultipliedtogethertodetermineascore.

Figure8‐2:CalEnviroScreenFormula

Source:OEHHA

Communities with scores in the top 25% would then be defined as Environmental JusticeCommunitiesforthepurposeoftheIllinoisSolarforAllProgram.Thisdefinitionwillbeusedtotargetgrass‐rootseducationfundingandincentivesfornon‐profitsandpublicfacilities.

A community that is not in the top 25% of scores and thus is not initially defined as being anEnvironmentalJusticeCommunitymayrequestconsiderationfromtheAgencytobeincluded.TheAgencywillconsiderrequestsforself‐designationasanenvironmentaljusticecommunitybasedona consideration of demonstrated quantitative environmental and/or socioeconomic factors thatwerenotadequatelycapturedinthescreeningdefinedabove.

TheAgencynotesthatthisapproachfocusesonanalysisofcensusblockgroup‐leveldata,andthatcommunitiesaretypicallyunderstoodbytheirresidentstobedefinedthroughgeographic,cultural,andotherfactorsthatmay,ormaynot,correspondtocensusblockgroupboundaries.Inaddition,theUSEPAcautionsthatdataintheEJSCREENtoolisnotalwaysreliableattheblockgrouplevel,andrecommendsthat itmaybenecessarytoaggregateupto largergeographicareas ina“bufferreport.”430

TheAgencywill thereforealsoconsider reasonableadjustments to thebordersof environmentaljusticecommunitiesfromwhatiscalculatedthroughthecensusblockgroupanalysis,providedthisdoesnotcreateanunacceptableanalyticalburden.

430EJSCREENTechnicalDocumentation,athttps://www.epa.gov/ejscreen/technical‐documentation‐ejscreen.


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8.15.3. EnvironmentalJusticeCommunityDesignationsTheAgencywillundertaketheanalysisdescribedinSection8.15.2afterthisPlan(andthustheinputsand methodology) is approved by the Commission. The Agency will consult with the IllinoisCommissiononEnvironmentalJusticeandinterestedstakeholdersonfinalizingthemethodologyandwillpublishonitswebsitedraftmapsanddataandinvitestakeholderstoreviewandcommentontheresults.Thiswillalsoprovideaninitialopportunityforcommunitiestorequestself‐designationas an environmental justice community. TheAgencywill review the feedback received and thenpublishfinalmapsandlistsofthedesignatedenvironmentaljusticecommunities.Themapswillbeupdatedonasemiannualbasistoreflectanyadditionalrequestsforself‐designation.

8.15.4. EnvironmentalJusticeCommunities25%GoalTheActstates that“It isagoalof thisprogramthataminimumof25%of the incentives for thisprogrambeallocatedtoprojectslocatedwithinenvironmentaljusticecommunities.”431

For the Low‐incomeDistributedGeneration Incentive, the Low‐IncomeCommunity Solar ProjectInitiative,andtheIncentives forNon‐profitsandPublicFacilities, theAgencywillreserve25%ofeachcategory’sannualbudgettosupportprojectsinenvironmentaljusticecommunities.Ifthefundsare fully allocated toprojects in environmental justice communities, then subsequentprojects inenvironmentaljusticecommunitieswouldstillbeeligibleusingthegeneralavailablebudgets.The25%reservationoffundsforenvironmentaljusticecommunitieswillresetatthebeginningofeachfiscalyear.

TheActalsodirectstheAgencyto“allocateupto5%ofthefundsavailableundertheIllinoisSolarforAllProgramtocommunity‐basedgroupstoassistingrassrootseducation.”432AsnotedinSection8.8,thatfundingwillbeprioritizedtowardsEnvironmentalJusticeCommunitiestohelpmeetthisgoal.Upto60%ofthefunding(or3percentagepointsofthe5%)willbeusedforthispurpose.

The Agency will review progress toward meeting the 25% goal during the Plan Update to bedevelopedin2019,andwillrecommendchangestothisapproach,ifnecessary.

8.16. ProgramChangesSeveral provisions in the Act anticipate the ability to revise and change program provisions. Inaddition to the provision described in Section 1‐56(b)(4) of the Act that allows stakeholders topropose additional programs as part of the approval of this, an additional provision allows theAgencytoreallocatefundsbetweenprograms:

“Theallocationoffundsamongsubparagraphs(A),(B),or(C)ofthisparagraph(2)maybechanged if theAgencyoradministrator, throughdelegatedauthority,determinesincentives in subparagraphs (A), (B), or (C) of this paragraph (2) have not beenadequately subscribed to fully utilize the Illinois Power Agency Renewable EnergyResources Fund. The determination shall include input through a stakeholderprocess.”433

43120ILCS3855/1‐56(b)(2).43220ILCS3855/1‐56(b)(3).43320ILCS3855/1‐56(b)(2).


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Atthistime,theAgencydoesnotbelievethisprovisionisapplicablebecausethisPlanisstillindraftformandtheprogramhasnotyetlaunched.AspartofthePlanUpdatescheduledtooccurin2019,theAgencywillreviewpreliminaryprogramresultsandtheEvaluationreportoutlinedinSection8.17beforeproposinganychangesinallocationoffunds.

Likewise,atthistimetheAgencyisnotproposinganyadjustmentstotheprogramspursuanttotheprovisionthat:

“FollowingtheCommission'sapprovaloftheIllinoisSolarforAllProgram,theAgencyor a party may propose adjustments to the program terms, conditions, andrequirements, including the price offered to new systems, to ensure the long‐termviabilityand successof theprogram.TheCommission shall reviewandapproveanymodificationstotheprogramthroughtheplanrevisionprocessdescribedinSection16‐111.5ofthePublicUtilitiesAct.”434

TheAgencywouldexpectthatanysuchproposalswillalsobepartofthePlanUpdatescheduledtobedevelopedin2019.

8.17. EvaluationSection1‐56(b)(6) requires that thisPlan includeanapproach for independent evaluationof theIllinoisSolarforAllProgram.Specifically,itcallsfor:

“Atleastevery2years,theAgencyshallselectanindependentevaluatortoreviewandreporton the Illinois Solar forAllProgramand theperformanceof the third‐partyprogramadministratorof the IllinoisSolar forAllProgram.Theevaluation shallbebasedonobjectivecriteriadevelopedthroughapublicstakeholderprocess.Theprocessshall include feedback and participation from Illinois Solar for All Programstakeholders, includingparticipantsandorganizations in environmental justiceandhistorically underserved communities. The report shall include a summary of theevaluation of the Illinois Solar forAllProgram based on the stakeholderdevelopedobjectivecriteria.Thereportshall includethenumberofprojects installed;thetotalinstalledcapacityinkilowatts;theaveragecostperkilowattofinstalledcapacitytotheextentreasonablyobtainableby theAgency;thenumberof jobsor jobopportunitiescreated; economic, social, and environmental benefits created; and the totaladministrativecostsexpendedbytheAgencyandprogramadministratortoimplementandevaluatetheprogram.”

TheAgencywillissueaRequestforQualifications/RequestforProposalstoselectanindependentevaluatortoconductthisevaluation.ThisselectionprocessisexpresslyexemptedfromtheIllinoisProcurementCode.435TheAgencyexpectstoselecttheevaluatorpriortothelaunchoftheIllinoisSolarforAllProgram.LikeothercontractstoimplementthisPlan,theselectionoftheevaluatorwillbesubjecttoCommissionapproval.TheAgencyobservesthathavinganevaluatorinplacepriortoprogramlaunchhelpstoensureproperdatacollectionbytheevaluator.

TheActcallsforanevaluation“atleastevery2years,”buttheAgencynotesthatIllinoisSolarForAllisexpectedtolaunchin2018,andtheAgencyisplanningtodevelopthefirstupdatetothePlanin

43420ILCS3855/1‐56(b)(4).43520ILCS3855/1‐56(f).


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2019,withimplementationthereofstartingin2020.Duetothistiming,thefirstevaluationwillbedoneonanacceleratedschedule,in2019,toinformtheupdateprocess.TheAgencycautionsthatduetopotentialstartupcomplications,earlyresultsmaynotbeindicativeofongoingimpactsoftheprograms,andthefirstevaluationmayhaveastrongeremphasisonprocessthanonoutcomes.