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[Congressional Bills 114th Congress]
[From the U.S. Government Publishing Office]
[S. 1258 Introduced in Senate (IS)]

114th CONGRESS
  1st Session
                                S. 1258

 To require the Secretary of Energy to establish a distributed energy 
loan program and technical assistance and grant program, and for other 
                               purposes.

_______________________________________________________________________

                   IN THE SENATE OF THE UNITED STATES

                              May 7, 2015

  Mr. Franken introduced the following bill; which was read twice and 
       referred to the Committee on Energy and Natural Resources

_______________________________________________________________________

                                 A BILL

 
 To require the Secretary of Energy to establish a distributed energy 
loan program and technical assistance and grant program, and for other 
                               purposes.

    Be it enacted by the Senate and House of Representatives of the 
United States of America in Congress assembled,

SECTION 1. SHORT TITLE.

    This Act may be cited as the ``Local Energy Supply and Resiliency 
Act of 2015''.

SEC. 2. DEFINITIONS.

    In this Act:
            (1) Combined heat and power system.--The term ``combined 
        heat and power system'' means generation of electric energy and 
        heat in a single, integrated system that meets the efficiency 
        criteria in clauses (ii) and (iii) of section 48(c)(3)(A) of 
        the Internal Revenue Code of 1986, under which heat that is 
        conventionally rejected is recovered and used to meet thermal 
        energy requirements.
            (2) Demand response.--The term ``demand response'' means 
        changes in electric usage by electric utility customers from 
        the normal consumption patterns of the customers in response 
        to--
                    (A) changes in the price of electricity over time; 
                or
                    (B) incentive payments designed to induce lower 
                electricity use at times of high wholesale market 
                prices or when system reliability is jeopardized.
            (3) Distributed energy.--The term ``distributed energy'' 
        means energy sources and systems that--
                    (A) produce electric or thermal energy close to the 
                point of use using renewable energy resources or waste 
                thermal energy;
                    (B) generate electricity using a combined heat and 
                power system;
                    (C) distribute electricity in microgrids;
                    (D) store electric or thermal energy; or
                    (E) distribute thermal energy or transfer thermal 
                energy to building heating and cooling systems through 
                a district energy system.
            (4) District energy system.--The term ``district energy 
        system'' means a system that provides thermal energy to 
        buildings and other energy consumers from 1 or more plants to 
        individual buildings to provide space heating, air 
        conditioning, domestic hot water, industrial process energy, 
        and other end uses.
            (5) Islanding.--The term ``islanding'' means a distributed 
        generator or energy storage device continuing to power a 
        location in the absence of electric power from the primary 
        source.
            (6) Loan.--The term ``loan'' has the meaning given the term 
        ``direct loan'' in section 502 of the Federal Credit Reform Act 
        of 1990 (2 U.S.C. 661a).
            (7) Microgrid.--The term ``microgrid'' means an integrated 
        energy system consisting of interconnected loads and 
        distributed energy resources, including generators and energy 
        storage devices, within clearly defined electrical boundaries 
        that--
                    (A) acts as a single controllable entity with 
                respect to the grid; and
                    (B) can connect and disconnect from the grid to 
                operate in both grid-connected mode and island mode.
            (8) Renewable energy source.--The term ``renewable energy 
        source'' includes--
                    (A) biomass;
                    (B) geothermal energy;
                    (C) hydropower;
                    (D) landfill gas;
                    (E) municipal solid waste;
                    (F) ocean (including tidal, wave, current, and 
                thermal) energy;
                    (G) organic waste;
                    (H) photosynthetic processes;
                    (I) photovoltaic energy;
                    (J) solar energy; and
                    (K) wind.
            (9) Renewable thermal energy.--The term ``renewable thermal 
        energy'' means heating or cooling energy derived from a 
        renewable energy resource.
            (10) Secretary.--The term ``Secretary'' means the Secretary 
        of Energy.
            (11) Thermal energy.--The term ``thermal energy'' means--
                    (A) heating energy in the form of hot water or 
                steam that is used to provide space heating, domestic 
                hot water, or process heat; or
                    (B) cooling energy in the form of chilled water, 
                ice, or other media that is used to provide air 
                conditioning, or process cooling.
            (12) Waste thermal energy.--The term ``waste thermal 
        energy'' means energy that--
                    (A) is contained in--
                            (i) exhaust gases, exhaust steam, condenser 
                        water, jacket cooling heat, or lubricating oil 
                        in power generation systems;
                            (ii) exhaust heat, hot liquids, or flared 
                        gas from any industrial process;
                            (iii) waste gas or industrial tail gas that 
                        would otherwise be flared, incinerated, or 
                        vented;
                            (iv) a pressure drop in any gas, excluding 
                        any pressure drop to a condenser that 
                        subsequently vents the resulting heat;
                            (v) condenser water from chilled water or 
                        refrigeration plants; or
                            (vi) any other form of waste energy, as 
                        determined by the Secretary; and
                    (B)(i) in the case of an existing facility, is not 
                being used; or
                    (ii) in the case of a new facility, is not 
                conventionally used in comparable systems.

SEC. 3. DISTRIBUTED ENERGY LOAN PROGRAM.

    (a) Loan Program.--
            (1) In general.--Subject to the provisions of this 
        subsection and subsections (b) and (c), the Secretary shall 
        establish a program to provide to eligible entities--
                    (A) loans for the deployment of distributed energy 
                systems in a specific project; and
                    (B) loans to provide funding for programs to 
                finance the deployment of multiple distributed energy 
                systems through a revolving loan fund, credit 
                enhancement program, or other financial assistance 
                program.
            (2) Eligibility.--Entities eligible to receive a loan under 
        paragraph (1) include--
                    (A) a State, territory, or possession of the United 
                States;
                    (B) a State energy office;
                    (C) a tribal organization (as defined in section 4 
                of the Indian Self-Determination and Education 
                Assistance Act (25 U.S.C. 450b));
                    (D) an institution of higher education (as defined 
                in section 101 of the Higher Education Act of 1965 (20 
                U.S.C. 1001)); and
                    (E) an electric utility, including--
                            (i) a rural electric cooperative;
                            (ii) a municipally owned electric utility; 
                        and
                            (iii) an investor-owned utility.
            (3) Selection requirements.--In selecting eligible entities 
        to receive loans under this section, the Secretary shall, to 
        the maximum extent practicable, ensure--
                    (A) regional diversity among eligible entities to 
                receive loans under this section, including 
                participation by rural States and small States; and
                    (B) that specific projects selected for loans--
                            (i) expand on the existing technology 
                        deployment program of the Department of Energy; 
                        and
                            (ii) are designed to achieve 1 or more of 
                        the objectives described in paragraph (4).
            (4) Objectives.--Each deployment selected for a loan under 
        paragraph (1) shall include 1 or more of the following 
        objectives:
                    (A) Improved security and resiliency of energy 
                supply in the event of disruptions caused by extreme 
                weather events, grid equipment or software failure, or 
                terrorist acts.
                    (B) Implementation of distributed energy in order 
                to increase use of local renewable energy resources and 
                waste thermal energy sources.
                    (C) Enhanced feasibility of microgrids, demand 
                response, or islanding;
                    (D) Enhanced management of peak loads for consumers 
                and the grid.
                    (E) Enhanced reliability in rural areas, including 
                high energy cost rural areas.
            (5) Restriction on use of funds.--Any eligible entity that 
        receives a loan under paragraph (1) may only use the loan to 
        fund programs relating to the deployment of distributed energy 
        systems.
    (b) Loan Terms and Conditions.--
            (1) Terms and conditions.--Notwithstanding any other 
        provision of law, in providing a loan under this section, the 
        Secretary shall provide the loan on such terms and conditions 
        as the Secretary determines, after consultation with the 
        Secretary of the Treasury, in accordance with this section.
            (2) Specific appropriation.--No loan shall be made unless 
        an appropriation for the full amount of the loan has been 
        specifically provided for that purpose.
            (3) Repayment.--No loan shall be made unless the Secretary 
        determines that there is reasonable prospect of repayment of 
        the principal and interest by the borrower of the loan.
            (4) Interest rate.--A loan provided under this section 
        shall bear interest at a fixed rate that is equal or 
        approximately equal, in the determination of the Secretary, to 
        the interest rate for Treasury securities of comparable 
        maturity.
            (5) Term.--The term of the loan shall require full 
        repayment over a period not to exceed the lesser of--
                    (A) 20 years; or
                    (B) 90 percent of the projected useful life of the 
                physical asset to be financed by the loan (as 
                determined by the Secretary).
            (6) Use of payments.--Payments of principal and interest on 
        the loan shall--
                    (A) be retained by the Secretary to support energy 
                research and development activities; and
                    (B) remain available until expended, subject to 
                such conditions as are contained in annual 
                appropriations Acts.
            (7) No penalty on early repayment.--The Secretary may not 
        assess any penalty for early repayment of a loan provided under 
        this section.
            (8) Return of unused portion.--In order to receive a loan 
        under this section, an eligible entity shall agree to return to 
        the general fund of the Treasury any portion of the loan amount 
        that is unused by the eligible entity within a reasonable 
        period of time after the date of the disbursement of the loan, 
        as determined by the Secretary.
            (9) Comparable wage rates.--Each laborer and mechanic 
        employed by a contractor or subcontractor in performance of 
        construction work financed, in whole or in part, by the loan 
        shall be paid wages at rates not less than the rates prevailing 
        on similar construction in the locality as determined by the 
        Secretary of Labor in accordance with subchapter IV of chapter 
        31 of title 40, United States Code.
    (c) Rules and Procedures; Disbursement of Loans.--
            (1) Rules and procedures.--Not later than 180 days after 
        the date of enactment of this Act, the Secretary shall adopt 
        rules and procedures for carrying out the loan program under 
        subsection (a).
            (2) Disbursement of loans.--Not later than 1 year after the 
        date on which the rules and procedures under paragraph (1) are 
        established, the Secretary shall disburse the initial loans 
        provided under this section.
    (d) Reports.--Not later than 2 years after the date of receipt of 
the loan, and annually thereafter for the term of the loan, an eligible 
entity that receives a loan under this section shall submit to the 
Secretary a report describing the performance of each program and 
activity carried out using the loan, including itemized loan 
performance data.
    (e) Authorization of Appropriations.--There are authorized to be 
appropriated to carry out this section such sums as are necessary.

SEC. 4. TECHNICAL ASSISTANCE AND GRANT PROGRAM.

    (a) Establishment.--
            (1) In general.--The Secretary shall establish a technical 
        assistance and grant program (referred to in this section as 
        the ``program'')--
                    (A) to disseminate information and provide 
                technical assistance directly to eligible entities so 
                the eligible entities can identify, evaluate, plan, and 
                design distributed energy systems; and
                    (B) to make grants to eligible entities so that the 
                eligible entities may contract to obtain technical 
                assistance to identify, evaluate, plan, and design 
                distributed energy systems.
            (2) Technical assistance.--The technical assistance 
        described in paragraph (1) shall include assistance with 1 or 
        more of the following activities relating to distributed energy 
        systems:
                    (A) Identification of opportunities to use 
                distributed energy systems.
                    (B) Assessment of technical and economic 
                characteristics.
                    (C) Utility interconnection.
                    (D) Permitting and siting issues.
                    (E) Business planning and financial analysis.
                    (F) Engineering design.
            (3) Information dissemination.--The information 
        disseminated under paragraph (1)(A) shall include--
                    (A) information relating to the topics described in 
                paragraph (2), including case studies of successful 
                examples;
                    (B) computer software and databases for assessment, 
                design, and operation and maintenance of distributed 
                energy systems; and
                    (C) public databases that track the operation and 
                deployment of existing and planned distributed energy 
                systems.
    (b) Eligibility.--Any nonprofit or for-profit entity shall be 
eligible to receive technical assistance and grants under the program.
    (c) Applications.--
            (1) In general.--An eligible entity desiring technical 
        assistance or grants under the program shall submit to the 
        Secretary an application at such time, in such manner, and 
        containing such information as the Secretary may require.
            (2) Application process.--The Secretary shall seek 
        applications for technical assistance and grants under the 
        program--
                    (A) on a competitive basis; and
                    (B) on a periodic basis, but not less frequently 
                than once every 12 months.
            (3) Priorities.--In selecting eligible entities for 
        technical assistance and grants under the program, the 
        Secretary shall give priority to eligible entities with 
        projects that have the greatest potential for--
                    (A) facilitating the use of renewable energy 
                resources;
                    (B) strengthening the reliability and resiliency of 
                energy infrastructure to the impact of extreme weather 
                events, power grid failures, and interruptions in 
                supply of fossil fuels;
                    (C) improving the feasibility of microgrids or 
                islanding, particularly in rural areas, including high 
                energy cost rural areas;
                    (D) minimizing environmental impact, including 
                regulated air pollutants and greenhouse gas emissions; 
                and
                    (E) maximizing local job creation.
    (d) Grants.--On application by an eligible entity, the Secretary 
may award grants to the eligible entity to provide funds to cover not 
more than--
            (1) 100 percent of the costs of the initial assessment to 
        identify opportunities;
            (2) 75 percent of the cost of feasibility studies to assess 
        the potential for the implementation;
            (3) 60 percent of the cost of guidance on overcoming 
        barriers to implementation, including financial, contracting, 
        siting, and permitting issues; and
            (4) 45 percent of the cost of detailed engineering.
    (e) Rules and Procedures.--
            (1) Rules.--Not later than 180 days after the date of 
        enactment of this Act, the Secretary shall adopt rules and 
        procedures for carrying out the program.
            (2) Grants.--Not later than 120 days after the date of 
        issuance of the rules and procedures for the program, the 
        Secretary shall issue grants under this Act.
    (f) Reports.--The Secretary shall submit to Congress and make 
available to the public--
            (1) not less frequently than once every 2 years, a report 
        describing the performance of the program under this section, 
        including a synthesis and analysis of the information provided 
        in the reports submitted to the Secretary under section 2(c); 
        and
            (2) on termination of the program under this section, an 
        assessment of the success of, and education provided by, the 
        measures carried out by eligible entities during the term of 
        the program.
    (g) Authorization of Appropriations.--There is authorized to be 
appropriated to carry out this section $250,000,000 for the period of 
fiscal years 2016 through 2020, to remain available until expended.
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