I 

116TH CONGRESS 

2D SESSION H. R. 9036 

To amend title VI of the Public Utility Regulatory Policies Act of 1978 

to establish a Federal renewable electricity standard for retail electricity 

suppliers and a Federal energy efficiency resource standard for retail 

electricity suppliers and retail natural gas suppliers, and for other purposes. 

IN THE HOUSE OF REPRESENTATIVES 

DECEMBER 18, 2020 

Mr. WELCH (for himself, Ms. CLARKE of New York, and Mr. LUJA ́N) introduced the following bill; which was referred to the Committee on Energy 

and Commerce 

A BILL 

To amend title VI of the Public Utility Regulatory Policies 

Act of 1978 to establish a Federal renewable electricity 

standard for retail electricity suppliers and a Federal 

energy efficiency resource standard for retail electricity 

suppliers and retail natural gas suppliers, and for other 

purposes. 

1 Be it enacted by the Senate and House of Representa2 tives of the United States of America in Congress assembled, 

3 SECTION 1. SHORT TITLE; FINDINGS. 

4 (a) SHORT TITLE.—This Act may be cited as the 

5 ‘‘American Renewable Energy and Efficiency Act’’. 


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1 (b) FINDINGS.—Congress finds that— 

2 (1) the Federal renewable electricity standard 

3 established by section 610 of the Public Utility Reg4 ulatory Policies Act of 1978 (as added by this Act) 

5 establishes a market-based policy to create ongoing 

6 competition among renewable electricity generators 

7 across the United States and provide the greatest 

8 quantity of clean electricity for the lowest price; 

9 (2) the United States has vast wind, solar, hy10 dropower, biomass, and geothermal resources that— 

11 (A) are renewable; 

12 (B) are dispersed widely across different 

13 regions of the United States; and 

14 (C) can be harnessed to generate a signifi15 cant share of electricity in the United States; 

16 (3) the Federal energy efficiency resource 

17 standard established by section 611 of the Public 

18 Utility Regulatory Policies Act of 1978 (as added by 

19 this Act)— 

20 (A) establishes nationwide minimum levels 

21 of electricity and natural gas savings to be 

22 achieved through utility efficiency programs, 

23 building energy codes, appliance standards, and 

24 related efficiency measures; and 


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1 (B) rewards energy-saving improvements 

2 achieved through— 

3 (i) end-use energy efficiency upgrades; 

4 (ii) reduced losses in transmission and 

5 distribution of energy; and 

6 (iii) fuel switching, to the extent that 

7 the switching results in reduced primary 

8 energy use; and 

9 (4) in light of the cost-effective energy effi10 ciency opportunities that exist across the United 

11 States in every sector of the economy, retail elec12 tricity suppliers, retail natural gas suppliers, and 

13 States should— 

14 (A) include energy efficiency as a resource 

15 in utility planning and procurement activities; 

16 and 

17 (B) seek to achieve all energy efficiency 

18 measures that are available at lower cost than 

19 other energy supply options. 

20 SEC. 2. FEDERAL RENEWABLE ELECTRICITY STANDARD. 

21 Title VI of the Public Utility Regulatory Policies Act 

22 of 1978 (16 U.S.C. 2601 et seq.) is amended by adding 

23 after section 609 (7 U.S.C. 918c) the following: 

24 ‘‘SEC. 610. FEDERAL RENEWABLE ELECTRICITY STANDARD. 

25 ‘‘(a) DEFINITIONS.—In this section: 


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1 ‘‘(1) FEDERAL RENEWABLE ELECTRICITY

2 CREDIT.—The term ‘Federal renewable electricity 

3 credit’ means a credit, that represents, for purposes 

4 of compliance with this section, 1 megawatt hour of 

5 renewable electricity, issued pursuant to subsection 

6 (e). 

7 ‘‘(2) IMPACTED COMMUNITY.—The term ‘im8 pacted community’ means— 

9 ‘‘(A) an economically distressed area af10 fected by environmental pollution or other haz11 ards that can lead to— 

12 ‘‘(i) exposure to the pollution or haz13 ard, including negative public health ef14 fects resulting from that exposure; or 

15 ‘‘(ii) environmental degradation; or 

16 ‘‘(B) an economically distressed area af17 fected by high unemployment due to— 

18 ‘‘(i) a significant decline in coal min19 ing activity; or 

20 ‘‘(ii) the closure of a coal-fired power 

21 plant. 

22 ‘‘(3) INDIAN LAND.—The term ‘Indian land’ 

23 means— 

24 ‘‘(A) any land within the limits of any In25 dian reservation, pueblo, or rancheria; 


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1 ‘‘(B) any land not within the limits of any 

2 Indian reservation, pueblo, or rancheria title to 

3 which on the date of enactment of this section 

4 was held by— 

5 ‘‘(i) the United States for the benefit 

6 of any Indian Tribe or individual; or 

7 ‘‘(ii) any Indian Tribe or individual 

8 subject to restriction by the United States 

9 against alienation; 

10 ‘‘(C) any dependent Indian community; or 

11 ‘‘(D) any land conveyed under the Alaska 

12 Native Claims Settlement Act to any Native 

13 Corporation (as that term is defined in section 

14 3 of that Act). 

15 ‘‘(4) INDIAN TRIBE.—The term ‘Indian Tribe’ 

16 means any Indian Tribe, band, nation, or other or17 ganized group or community (including any Native 

18 village, Regional Corporation, or Village Corporation 

19 (as those terms are defined in section 3 of the Alas20 ka Native Claims Settlement Act)) that is recognized 

21 as eligible for the special programs and services pro22 vided by the United States to Indians because of 

23 their status as Indians. 

24 ‘‘(5) QUALIFIED HYDROPOWER.—The term 

25 ‘qualified hydropower’ means energy produced from 


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1 generating capacity added to a dam on or after Jan2 uary 1, 2001, if the Commission certifies that— 

3 ‘‘(A) the dam— 

4 ‘‘(i) was placed in service before the 

5 date of enactment of this section; 

6 ‘‘(ii) was operated for flood control, 

7 navigation, or water supply purposes; and 

8 ‘‘(iii) was not producing hydroelectric 

9 power prior to the addition of the capacity; 

10 and 

11 ‘‘(B) the hydroelectric project installed on 

12 the dam— 

13 ‘‘(i) is licensed or is exempt from li14 censing by the Commission; 

15 ‘‘(ii) is in compliance with— 

16 ‘‘(I) the terms and conditions of 

17 the license or exemption; and 

18 ‘‘(II) other applicable legal re19 quirements for the protection of envi20 ronmental quality, including applica21 ble fish passage requirements; and 

22 ‘‘(iii) is operated so that the water 

23 surface elevation at any given location and 

24 time that would have occurred in the ab25 sence of the hydroelectric project is mainVerDate Sep 11 2014 02:13 Jan 10, 2021 Jkt 019200 PO 00000 Frm 00006 Fmt 6652 Sfmt 6201 E:\BILLS\H9036.IH H9036

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1 tained, subject to any license or exemption 

2 requirements that require changes in water 

3 surface elevation for the purpose of im4 proving the environmental quality of the 

5 affected waterway. 

6 ‘‘(6) QUALIFIED RENEWABLE BIOMASS.—The 

7 term ‘qualified renewable biomass’ means renewable 

8 biomass that, when combusted, yields, on a weight9 ed-average basis, at least 50 percent less lifecycle 

10 greenhouse gas emissions (as defined in section 4(a) 

11 of the American Renewable Energy and Efficiency 

12 Act) per unit of useful energy, than the lifecycle 

13 greenhouse gas emissions, including methane leak14 age, from the generation of such unit of useful en15 ergy by a combined cycle natural gas electric gener16 ating unit using the most efficient commercially 

17 available technology (based on lifecycle greenhouse 

18 gas emissions). 

19 ‘‘(7) RENEWABLE BIOMASS.—The term ‘renew20 able biomass’ means— 

21 ‘‘(A) crop byproducts or crop residues har22 vested from actively managed or fallow agricul23 tural land that is cleared prior to the date of 

24 enactment of this section; 


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1 ‘‘(B) planted trees, brush, slash, and resi2 dues from an actively managed tree farm dedi3 cated to energy crop production and located on 

4 land cleared prior to the date of enactment of 

5 this section; 

6 ‘‘(C) byproducts of wood or paper mill op7 erations, including lignin in spent pulping liq8 uors; 

9 ‘‘(D) algae; 

10 ‘‘(E) nonhazardous plant matter derived 

11 from waste— 

12 ‘‘(i) including separated yard waste, 

13 landscape right-of-way trimmings, or food 

14 waste; but 

15 ‘‘(ii) not including municipal solid 

16 waste, recyclable waste paper, painted, 

17 treated or pressurized wood, or wood con18 taminated with plastic or metals; and 

19 ‘‘(F) vegetative matter removed from with20 in 200 yards of any manmade structure or 

21 campground for the purposes of protecting 

22 structures from wildfire. 

23 ‘‘(8) RENEWABLE ELECTRICITY.—The term ‘re24 newable electricity’ means electricity generated (inVerDate Sep 11 2014 02:13 Jan 10, 2021 Jkt 019200 PO 00000 Frm 00008 Fmt 6652 Sfmt 6201 E:\BILLS\H9036.IH H9036

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1 cluding by means of a fuel cell) from a renewable en2 ergy resource. 

3 ‘‘(9) RENEWABLE ENERGY RESOURCE.—The 

4 term ‘renewable energy resource’ means each of the 

5 following: 

6 ‘‘(A) Wind energy. 

7 ‘‘(B) Solar energy. 

8 ‘‘(C) Geothermal energy. 

9 ‘‘(D) Qualified renewable biomass. 

10 ‘‘(E) Biogas derived from qualified renew11 able biomass. 

12 ‘‘(F) Biofuel derived from qualified renew13 able biomass. 

14 ‘‘(G) Biogas derived from anaerobic diges15 tion at wastewater treatment facilities or from 

16 farms through anaerobic digesters. 

17 ‘‘(H) Qualified hydropower. 

18 ‘‘(I) Marine and hydrokinetic renewable 

19 energy (as defined in section 632 of the Energy 

20 Independence and Security Act of 2007). 

21 ‘‘(J) Landfill gas. 

22 ‘‘(10) RETAIL ELECTRICITY SUPPLIER.— 

23 ‘‘(A) IN GENERAL.—The term ‘retail elec24 tricity supplier’ means, for any calendar year, 

25 an electric utility that sells not fewer than 


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1 1,000,000 megawatt hours of electricity to elec2 tric consumers during the preceding calendar 

3 year. 

4 ‘‘(B) INCLUSIONS AND LIMITATIONS.—For 

5 purposes of determining whether an electric 

6 utility qualifies as a retail electricity supplier 

7 under subparagraph (A)— 

8 ‘‘(i) the sales made by any affiliate of 

9 the electric utility to electric consumers, 

10 other than sales to lessees or tenants of 

11 the affiliate, shall be considered to be sales 

12 made by the electric utility; and 

13 ‘‘(ii) sales made by the electric utility 

14 to an affiliate, lessee, or tenant of the elec15 tric utility shall not be treated as sales to 

16 electric consumers. 

17 ‘‘(C) AFFILIATE.—In this paragraph, the 

18 term ‘affiliate’ when used in relation to a per19 son, means another person that directly or indi20 rectly owns or controls, is owned or controlled 

21 by, or is under common ownership or control 

22 with, that person, as determined under regula23 tions promulgated by the Commission. 

24 ‘‘(11) RETAIL ELECTRICITY SUPPLIER’S BASE

25 QUANTITY.—The term ‘retail electricity supplier’s 


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1 base quantity’ means the total quantity of electricity 

2 sold by the retail electricity supplier, expressed in 

3 megawatt hours, to electric consumers during the 

4 relevant calendar year, excluding— 

5 ‘‘(A) electricity generated by a hydro6 electric facility, other than qualified hydro7 power; and 

8 ‘‘(B) electricity generated by the combus9 tion of municipal solid waste. 

10 ‘‘(12) RETIRE AND RETIREMENT.—The terms 

11 ‘retire’ and ‘retirement’ with respect to a Federal re12 newable electricity credit, mean to disqualify the 

13 credit for any subsequent use under this section, re14 gardless of whether the use is a sale, transfer, ex15 change, or submission in satisfaction of a compliance 

16 obligation. 

17 ‘‘(b) ANNUAL COMPLIANCE OBLIGATION.—Except as 

18 otherwise provided in subsection (f), for each of calendar 

19 years 2021 through 2039, not later than March 31 of the 

20 following calendar year, each retail electricity supplier 

21 shall submit to the Commission a quantity of Federal re22 newable electricity credits that represents a quantity of 

23 megawatt hours of renewable electricity that is at least 

24 equal to the annual target of the retail electricity supplier 

25 under subsection (d). 


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1 ‘‘(c) ESTABLISHMENT.— 

2 ‘‘(1) IN GENERAL.—Not later than 1 year after 

3 the date of enactment of this section, the Commis4 sion shall promulgate regulations to implement and 

5 enforce the requirements of this section. 

6 ‘‘(2) CONSIDERATIONS.—In promulgating regu7 lations under paragraph (1), the Commission shall, 

8 to the maximum extent practicable— 

9 ‘‘(A) preserve the integrity and incorporate 

10 best practices of existing State and tribal re11 newable electricity programs; 

12 ‘‘(B) preserve the integrity of voluntary re13 newable energy markets; 

14 ‘‘(C) delegate to an appropriate market15 making entity the administration of a national 

16 tradeable Federal renewable electricity credit 

17 market for purposes of creating a transparent 

18 national market for the sale or trade of Federal 

19 renewable electricity credits, relying on existing 

20 and emerging State, tribal, or regional tracking 

21 systems that issue and track non-Federal re22 newable electricity credits; and 

23 ‘‘(D) cooperate with States and Indian 

24 Tribes— 


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1 ‘‘(i) to facilitate coordination between 

2 State, tribal, and Federal renewable elec3 tricity programs; and 

4 ‘‘(ii) to minimize administrative bur5 dens and costs to retail electricity sup6 pliers. 

7 ‘‘(d) ANNUAL COMPLIANCE REQUIREMENT.— 

8 ‘‘(1) ANNUAL TARGETS.—For each of calendar 

9 years 2021 through 2039, the annual target of a re10 tail electricity supplier shall be equal to the number 

11 of megawatt hours that is equal to the product ob12 tained by multiplying— 

13 ‘‘(A) the required annual percentage for 

14 that calendar year under paragraph (2); and 

15 ‘‘(B) the retail electricity supplier’s base 

16 quantity for that calendar year. 

17 ‘‘(2) REQUIRED ANNUAL PERCENTAGE.— 

18 ‘‘(A) CALENDAR YEARS 2021 THROUGH

19 2030.—For each of calendar years 2021 through 

20 2030, the required annual percentage shall be 

21 as follows: 


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Required annual 

‘‘Year: percentage: 

2021 ................................................................................................... 21.0 

2022 ................................................................................................... 24.5 

2023 ................................................................................................... 28.0 

2024 ................................................................................................... 31.5 

2025 ................................................................................................... 35.0 

2026 ................................................................................................... 39.0 

2027 ................................................................................................... 43.0 

2028 ................................................................................................... 47.0 

2029 ................................................................................................... 51.0 

2030 ................................................................................................... 55.0 

1 ‘‘(B) CALENDAR YEARS 2031 THROUGH

2 2039.— 

3 ‘‘(i) INCREASE.—Except as provided 

4 in clause (ii), for each of calendar years 

5 2031 through 2039, the required annual 

6 percentage shall be equal to the required 

7 annual percentage for the previous cal8 endar year plus 4 percentage points. 

9 ‘‘(ii) FEASIBILITY.— 

10 ‘‘(I) ADJUSTMENT.—Except as 

11 provided in subclause (II), for any of 

12 calendar years 2031 through 2039, 

13 the Commission may increase or de14 crease the 4 percentage point increase 

15 required under clause (i) if the Com16 mission determines necessary based 

17 on technical and economic feasibility 

18 studies or other equivalent means. 


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1 ‘‘(II) EXCEPTION.—For each of 

2 calendar years 2031 through 2039, 

3 the percentage point increase required 

4 under this subparagraph for the re5 quired annual percentage shall be 

6 greater than zero. 

7 ‘‘(e) FEDERAL RENEWABLE ELECTRICITY CRED8 ITS.— 

9 ‘‘(1) IN GENERAL.— 

10 ‘‘(A) ISSUANCE; TRACKING; 

11 VERIFICATION.—The regulations promulgated 

12 under this section shall include provisions gov13 erning the issuance, tracking, and verification 

14 of Federal renewable electricity credits. 

15 ‘‘(B) CREDIT RATIO.—Except as provided 

16 in paragraphs (2) through (4), the Commission 

17 shall issue to each generator of renewable elec18 tricity 1 Federal renewable electricity credit for 

19 each megawatt hour of renewable electricity 

20 generated by the generator after December 31, 

21 2020. 

22 ‘‘(C) SERIAL NUMBER.—The Commission 

23 shall assign a unique serial number to each 

24 Federal renewable electricity credit. 


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1 ‘‘(2) GENERATION FROM CERTAIN STATE RE2 NEWABLE ELECTRICITY PROGRAMS.— 

3 ‘‘(A) IN GENERAL.—If renewable elec4 tricity is generated with the support of pay5 ments from a retail electricity supplier pursuant 

6 to a State renewable electricity program 

7 (whether through State alternative compliance 

8 payments or through payments to a State re9 newable electricity procurement fund or entity), 

10 the Commission shall issue Federal renewable 

11 electricity credits to the retail electricity sup12 plier for the portion of the relevant renewable 

13 electricity generation that is attributable to pay14 ments made by the retail electricity supplier, as 

15 determined pursuant to regulations promul16 gated by the Commission. 

17 ‘‘(B) REMAINING PORTION.—For any re18 maining portion of the relevant renewable elec19 tricity generation, the Commission shall issue 

20 Federal renewable electricity credits to the gen21 erator, as provided in paragraph (1), except 

22 that not more than 1 Federal renewable elec23 tricity credit shall be issued for the same mega24 watt hour of electricity. 


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1 ‘‘(C) STATE GUIDANCE.—In determining 

2 how Federal renewable electricity credits will be 

3 apportioned among retail electricity suppliers 

4 and generators under this paragraph, the Com5 mission shall consider information and guidance 

6 issued by the applicable one or more States. 

7 ‘‘(3) CERTAIN POWER SALES CONTRACTS.—Ex8 cept as otherwise provided in paragraph (2), if a 

9 generator has sold renewable electricity to a retail 

10 electricity supplier under a contract for power from 

11 a facility placed in service before the date of enact12 ment of this section, and the contract does not pro13 vide for the determination of ownership of the Fed14 eral renewable electricity credits associated with the 

15 generation, the Commission shall issue the Federal 

16 renewable electricity credits to the retail electricity 

17 supplier for the duration of the contract. 

18 ‘‘(4) CREDIT MULTIPLIERS.— 

19 ‘‘(A) IN GENERAL.—Except as provided in 

20 subparagraph (B), the Commission shall 

21 issue— 

22 ‘‘(i) not more than 2 Federal renew23 able electricity credits for each megawatt 

24 hour of renewable electricity generated in a 


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1 community that the Commission deter2 mines is an impacted community; and 

3 ‘‘(ii) not more than 2 Federal renew4 able electricity credits for each megawatt 

5 hour of renewable electricity generated on 

6 Indian land. 

7 ‘‘(B) ADJUSTMENT.—Except as provided 

8 in subparagraph (C), not later than January 1, 

9 2023, and not less frequently than every 4 

10 years thereafter, the Commission shall review 

11 the effect on the aggregate quantity of renew12 able electricity generated as a result of pro13 viding credit multipliers under this paragraph 

14 and shall, as necessary and after providing 1 

15 year of notice, reduce the number of Federal re16 newable electricity credits issued under this 

17 paragraph per megawatt hour of renewable 

18 electricity generated by any given energy source 

19 or facility, but not below one, to ensure that the 

20 number is no higher than the Commission de21 termines is necessary to incentivize incremental 

22 renewable energy generation in impacted com23 munities and on Indian land. 

24 ‘‘(C) FACILITIES PLACED IN SERVICE

25 AFTER ENACTMENT.— 


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1 ‘‘(i) IN GENERAL.—For any renewable 

2 electricity generation facility placed in 

3 service after the date of enactment of this 

4 section, subparagraph (B) shall not apply 

5 for the first 10 years after the date on 

6 which the facility is placed in service. 

7 ‘‘(ii) INITIAL PERIOD.—For each year 

8 during the 10-year period described in 

9 clause (i), the Commission shall issue to 

10 the facility the same number of Federal re11 newable electricity credits per megawatt 

12 hour generated as are issued to that facil13 ity in the year in which the facility is 

14 placed in service. 

15 ‘‘(iii) SUBSEQUENT PERIOD.—After 

16 the 10-year period described in clause (i), 

17 the Commission shall issue Federal renew18 able electricity credits to the facility in ac19 cordance with subparagraph (B). 

20 ‘‘(5) CREDITS BASED ON QUALIFIED HYDRO21 POWER.—For purposes of this subsection, the num22 ber of megawatt hours of renewable electricity gen23 eration from qualified hydropower shall be cal24 culated— 


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1 ‘‘(A) based solely on the increase in aver2 age annual generation directly resulting from 

3 the efficiency improvements or capacity addi4 tions described in subsection (a)(5)(A); and 

5 ‘‘(B) using the same water flow informa6 tion used to determine a historic average an7 nual generation baseline for the hydroelectric 

8 facility, as certified by the Commission. 

9 ‘‘(6) GENERATION FROM MIXED RENEWABLE

10 AND NONRENEWABLE RESOURCES.—If electricity is 

11 generated using both a renewable energy resource 

12 and an energy source that is not a renewable energy 

13 resource (such as cofiring of renewable biomass and 

14 fossil fuel), the Commission shall issue Federal re15 newable electricity credits based on the proportion of 

16 the electricity generated that is attributable to the 

17 renewable energy resource. 

18 ‘‘(7) PROHIBITION AGAINST DOUBLE-COUNT19 ING.—The Commission shall ensure that— 

20 ‘‘(A) no Federal renewable electricity cred21 it is used more than once for compliance with 

22 this section; and 

23 ‘‘(B) except as provided in paragraph (4), 

24 not more than 1 Federal renewable electricity 


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1 credit is issued for any megawatt hour of re2 newable electricity generated. 

3 ‘‘(8) TRADING.—The lawful holder of a Federal 

4 renewable electricity credit may— 

5 ‘‘(A) sell, exchange, or transfer the credit; 

6 ‘‘(B) submit the credit for compliance 

7 under subsection (b); or 

8 ‘‘(C) submit the credit for retirement by 

9 the Commission. 

10 ‘‘(9) BANKING.— 

11 ‘‘(A) IN GENERAL.—A Federal renewable 

12 electricity credit may be submitted in satisfac13 tion of the compliance obligation under sub14 section (b) for the compliance year in which the 

15 credit was issued or for any of the 3 imme16 diately subsequent compliance years. 

17 ‘‘(B) RETIREMENT.—The Commission 

18 shall retire any Federal renewable electricity 

19 credit that has not been retired by April 2 of 

20 the calendar year that is 3 years after the cal21 endar year during which the credit was issued. 

22 ‘‘(10) RETIREMENT.—The Commission shall re23 tire a Federal renewable electricity credit imme24 diately upon submission by the lawful holder of the 


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1 credit, whether in satisfaction of a compliance obli2 gation under subsection (b) or for another reason. 

3 ‘‘(f) ALTERNATIVE COMPLIANCE PAYMENTS.— 

4 ‘‘(1) IN GENERAL.—A retail electricity supplier 

5 may satisfy the requirements of subsection (b) in 

6 whole or in part by submitting in accordance with 

7 this subsection, in lieu of each Federal renewable 

8 electricity credit that would otherwise be submitted, 

9 an alternative compliance payment equal to $50, ad10 justed for inflation on January 1 of each year fol11 lowing calendar year 2021, in accordance with regu12 lations promulgated by the Commission. 

13 ‘‘(2) PAYMENT TO STATE FUNDS.— 

14 ‘‘(A) IN GENERAL.—Except as otherwise 

15 provided in this paragraph, payments made 

16 under this subsection shall be made directly to 

17 one or more States in which the retail elec18 tricity supplier sells electricity, in proportion to 

19 the portion of the retail electricity supplier’s 

20 base quantity that is sold within each applicable 

21 State, if— 

22 ‘‘(i) the payments are deposited di23 rectly into a fund of the State treasury es24 tablished for that purpose; and 


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1 ‘‘(ii) the State uses the funds in ac2 cordance with paragraphs (3) and (4). 

3 ‘‘(B) NONCOMPLIANCE.—If the Commis4 sion determines that a State is in substantial 

5 noncompliance with paragraph (3) or (4), the 

6 Commission shall direct that any future alter7 native compliance payments that would other8 wise be paid to the State under this subsection 

9 shall instead be paid to the Commission and de10 posited in the Treasury. 

11 ‘‘(3) STATE USE OF FUNDS.—As a condition of 

12 receipt of alternative compliance payments under 

13 this subsection, a State shall use the payments ex14 clusively for— 

15 ‘‘(A) deploying technologies that generate 

16 electricity from renewable energy resources; or 

17 ‘‘(B) implementing cost-effective energy ef18 ficiency programs to achieve energy savings. 

19 ‘‘(4) REPORTING.— 

20 ‘‘(A) IN GENERAL.—As a condition of re21 ceipt of alternative compliance payments pursu22 ant to this subsection, a State shall submit to 

23 the Commission an annual report, in accord24 ance with regulations promulgated by the Com25 mission, containing a full accounting of the use 


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1 of the payments, including a detailed descrip2 tion of the activities funded by the payments 

3 and demonstrating compliance with the require4 ments of this subsection. 

5 ‘‘(B) DEADLINE.—A State shall submit a 

6 report under this paragraph— 

7 ‘‘(i) not later than 1 year after the 

8 date on which the first alternative compli9 ance payment is received; and 

10 ‘‘(ii) every 1 year thereafter until all 

11 alternative compliance payments are ex12 pended. 

13 ‘‘(g) INFORMATION COLLECTION.—The Commission 

14 may require any retail electricity supplier, renewable elec15 tricity generator, or any other entity that the Commission 

16 determines appropriate, to provide any information the 

17 Commission determines appropriate to carry out this sec18 tion. 

19 ‘‘(h) ENFORCEMENT AND JUDICIAL REVIEW.— 

20 ‘‘(1) FAILURE TO SUBMIT CREDITS.—If any 

21 person fails to comply with the requirements of sub22 section (b) or (f) for a calendar year, the person 

23 shall be liable to pay to the Commission a civil pen24 alty equal to the product obtained by multiplying— 


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1 ‘‘(A) double the alternative compliance 

2 payment calculated under subsection (f)(1) for 

3 such calendar year; and 

4 ‘‘(B) the aggregate quantity of Federal re5 newable electricity credits or equivalent alter6 native compliance payments that the person 

7 failed to submit in violation of the requirements 

8 of subsections (b) and (f) for such calendar 

9 year. 

10 ‘‘(2) ENFORCEMENT.—The Commission shall 

11 assess a civil penalty under paragraph (1) in accord12 ance with the procedures described in section 31(d) 

13 of the Federal Power Act. 

14 ‘‘(3) VIOLATION OF REQUIREMENT OF REGULA15 TIONS OR ORDERS.— 

16 ‘‘(A) IN GENERAL.—Any person who vio17 lates or fails or refuses to comply with any re18 quirement of this section, other than a require19 ment of subsection (b) or (f), shall be subject 

20 to a civil penalty under section 316A(b) of the 

21 Federal Power Act. 

22 ‘‘(B) ASSESSMENT.—The penalty under 

23 subparagraph (A) shall be assessed by the Com24 mission in the same manner as in the case of 


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1 a violation referred to in section 316A(b) of 

2 that Act. 

3 ‘‘(4) JUDICIAL REVIEW.— 

4 ‘‘(A) IN GENERAL.—Any person aggrieved 

5 by a final action taken by the Commission 

6 under this section, other than the assessment of 

7 a civil penalty under paragraphs (1) through 

8 (3), may use the procedures for review de9 scribed in section 313 of the Federal Power 

10 Act. 

11 ‘‘(B) REFERENCE.—For purposes of this 

12 paragraph, references to an order in section 

13 313 of that Act shall be considered to refer also 

14 to all other final actions of the Commission 

15 under this section other than the assessment of 

16 a civil penalty under paragraphs (1) through 

17 (3). 

18 ‘‘(i) ADMINISTRATION.—Nothing in this section— 

19 ‘‘(1) diminishes or qualifies any authority of a 

20 State, a political subdivision of a State, or an Indian 

21 Tribe— 

22 ‘‘(A) to adopt or enforce any law or regula23 tion respecting renewable electricity, including 

24 any law or regulation establishing requirements 

25 that are more stringent than those established 


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1 by this section, provided that no such law or 

2 regulation may relieve any person of any re3 quirement otherwise applicable under this sec4 tion; or 

5 ‘‘(B) to regulate the acquisition and dis6 position of Federal renewable electricity credits 

7 by retail electricity suppliers within the jurisdic8 tion of the State, political subdivision, or Indian 

9 Tribe, including the authority to require the re10 tail electricity supplier to acquire and submit to 

11 the Commission for retirement Federal renew12 able electricity credits in excess of those sub13 mitted under this section; or 

14 ‘‘(2) affects the application of or the responsi15 bility for compliance with any other provision of law 

16 or regulation.’’. 

17 SEC. 3. CLARIFYING STATE AUTHORITY TO ADOPT RENEW18 ABLE ENERGY INCENTIVES. 

19 Section 210 of the Public Utility Regulatory Policies 

20 Act of 1978 (16 U.S.C. 824a–3) is amended by adding 

21 at the end the following: 

22 ‘‘(o) CLARIFICATION OF STATE AUTHORITY TO

23 ADOPT RENEWABLE ENERGY INCENTIVES.— 

24 ‘‘(1) DEFINITION OF STATE-APPROVED PRO25 DUCTION INCENTIVE PROGRAM.—In this subsection, 


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1 the term ‘State-approved production incentive pro2 gram’ means a requirement imposed pursuant to 

3 State law or by a State regulatory authority acting 

4 within its authority under State law that an electric 

5 utility purchase renewable energy (as defined in sec6 tion 609(a)) at a specified rate. 

7 ‘‘(2) STATE AUTHORITY TO ADOPT RENEWABLE

8 ENERGY INCENTIVES.—Notwithstanding any other 

9 provision of this Act or the Federal Power Act, a 

10 State law or State regulatory authority may set the 

11 rates for a sale of electricity by a facility generating 

12 renewable energy (as defined in section 609(a)) pur13 suant to a State-approved production incentive pro14 gram under which the facility voluntarily partici15 pates in the State-approved production incentive 

16 program.’’. 

17 SEC. 4. GUIDELINES FOR DETERMINING QUALIFIED RE18 NEWABLE BIOMASS. 

19 (a) DEFINITIONS.—In this section: 

20 (1) ADMINISTRATOR.—The term ‘‘Adminis21 trator’’ means the Administrator of the Environ22 mental Protection Agency. 

23 (2) LIFECYCLE GREENHOUSE GAS EMIS24 SIONS.— 


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1 (A) IN GENERAL.—The term ‘‘lifecycle 

2 greenhouse gas emissions’’ means the aggregate 

3 quantity of greenhouse gas emissions, adjusted 

4 to account for the relative global warming po5 tential of the emissions relative to all green6 house gas emissions. 

7 (B) INCLUSIONS.—For purposes of sub8 paragraph (A), the term ‘‘greenhouse gas emis9 sions’’ includes— 

10 (i) direct emissions; and 

11 (ii) significant indirect emissions, in12 cluding from— 

13 (I) land use changes and tem14 poral changes in forest carbon seques15 tration; 

16 (II) biomass harvests, regrowth, 

17 and avoided decomposition related to 

18 the full fuel lifecycle, including all 

19 stages of fuel and feedstock produc20 tion and distribution; and 

21 (III) feedstock generation or ex22 traction through the distribution and 

23 delivery of the finished fuel to the ul24 timate consumer. 


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1 (b) GUIDELINES.—Not later than 1 year after the 

2 date of enactment of this Act, the Administrator shall, rec3 ognizing the recommendations of, and coordinating with, 

4 the Scientific Advisory Board of the Environmental Pro5 tection Agency regarding the accounting of biogenic car6 bon dioxide emissions, and after notice and public com7 ment, issue guidelines for calculating lifecycle greenhouse 

8 gas emissions for renewable biomass (as that term is de9 fined in section 610(a) of the Public Utility Regulatory 

10 Policies Act of 1978, as added by this Act). 

11 SEC. 5. ENERGY EFFICIENCY RESOURCE STANDARD FOR 

12 RETAIL ELECTRICITY AND NATURAL GAS 

13 SUPPLIERS. 

14 (a) IN GENERAL.—Title VI of the Public Utility Reg15 ulatory Policies Act of 1978 (16 U.S.C. 2601 et seq.) is 

16 further amended by adding at the end the following: 

17 ‘‘SEC. 611. FEDERAL ENERGY EFFICIENCY RESOURCE 

18 STANDARD FOR RETAIL ELECTRICITY AND 

19 NATURAL GAS SUPPLIERS. 

20 ‘‘(a) DEFINITIONS.—In this section: 

21 ‘‘(1) AFFILIATE.—The term ‘affiliate’ when 

22 used in relation to a person, means another person 

23 that owns or controls, is owned or controlled by, or 

24 is under common ownership control with, that perVerDate Sep 11 2014 02:13 Jan 10, 2021 Jkt 019200 PO 00000 Frm 00030 Fmt 6652 Sfmt 6201 E:\BILLS\H9036.IH H9036

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1 son, as determined under regulations promulgated 

2 by the Secretary. 

3 ‘‘(2) ASHRAE, ANSI, AND IESNA.—The terms 

4 ‘ASHRAE’, ‘ANSI’, and ‘IESNA’ mean the Amer5 ican Society of Heating, Refrigerating and Air Con6 ditioning Engineers, the American National Stand7 ards Institute, and the Illuminating Engineering So8 ciety of North America, respectively. 

9 ‘‘(3) BASE QUANTITY.— 

10 ‘‘(A) IN GENERAL.—The term ‘base quan11 tity’, with respect to a retail electricity supplier 

12 or retail natural gas supplier, means, for each 

13 calendar year for which a performance standard 

14 is established under subsection (c), the average 

15 annual quantity of electricity delivered by the 

16 retail electricity supplier to electric consumers, 

17 or quantity of natural gas delivered by the re18 tail natural gas supplier to natural gas con19 sumers, during the 3 calendar years imme20 diately preceding the year that compliance is re21 quired under subsection (c)(1). 

22 ‘‘(B) EXCLUSION.—The term ‘base quan23 tity’, with respect to a retail natural gas sup24 plier, does not include natural gas delivered for 

25 purposes of electricity generation. 


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1 ‘‘(4) CHP SAVINGS.—The term ‘CHP savings’ 

2 means— 

3 ‘‘(A) CHP system savings from a combined 

4 heat and power system that commences oper5 ation after the date of enactment of this sec6 tion; and 

7 ‘‘(B) the increase in CHP system savings 

8 from upgrading or replacing, after the date of 

9 enactment of this section, a combined heat and 

10 power system that commenced operation on or 

11 before the date of enactment of this section. 

12 ‘‘(5) CHP SYSTEM SAVINGS.—The term ‘CHP 

13 system savings’ means the electric output, and the 

14 electricity saved due to the mechanical output, of a 

15 combined heat and power system, adjusted to reflect 

16 any increase in fuel consumption by that system as 

17 compared to the fuel that would have been required 

18 to produce an equivalent useful thermal energy out19 put in a separate thermal-only system, as deter20 mined in accordance with regulations promulgated 

21 by the Secretary. 

22 ‘‘(6) CODES AND STANDARDS SAVINGS.—The 

23 term ‘codes and standards savings’ means a reduc24 tion in electricity or natural gas consumption as a 

25 result of the adoption and implementation, after the 


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1 date of enactment of this section, of new or revised 

2 appliance and equipment efficiency standards or 

3 building energy codes. 

4 ‘‘(7) COMBINED HEAT AND POWER SYSTEM.— 

5 The term ‘combined heat and power system’ means 

6 a system that uses the same energy source both for 

7 the generation of electrical or mechanical power and 

8 the production of steam or another form of useful 

9 thermal energy, if— 

10 ‘‘(A) the system meets any requirements 

11 relating to efficiency and other operating char12 acteristics that the Secretary promulgates by 

13 regulation; and 

14 ‘‘(B) the net wholesale sales of electricity 

15 by a facility does not exceed 50 percent of total 

16 annual electric generation by the facility. 

17 ‘‘(8) COST-EFFECTIVE.—The term ‘cost-effec18 tive’, with respect to an energy efficiency program, 

19 means that the program achieves a net present value 

20 of economic benefits over the life of the implemented 

21 measures, both directly to the energy consumer and 

22 to the economy, that is greater than the net present 

23 value of the cost of the program over the life of the 

24 program, both directly to the energy consumer and 

25 to the economy, using the societal benefit-cost test 


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1 calculated using the lower of a utility weighted aver2 age cost of capital or a social discount rate of 3 per3 cent. 

4 ‘‘(9) CUSTOMER FACILITY SAVINGS.—The term 

5 ‘customer facility savings’ means a reduction in elec6 tricity, or natural gas consumption, including waste 

7 heat energy savings, at a facility of an electricity 

8 consumer served by a retail electricity supplier or a 

9 natural gas consumer served by a natural gas sup10 plier, as compared to— 

11 ‘‘(A) in the case of new equipment that re12 places existing equipment with remaining useful 

13 life— 

14 ‘‘(i) consumption of the existing 

15 equipment for the remaining useful life of 

16 the equipment; and 

17 ‘‘(ii) thereafter, consumption by new 

18 equipment of average efficiency of the 

19 same equipment type; 

20 ‘‘(B) in the case of new equipment other 

21 than new equipment described in subparagraph 

22 (A), consumption by new equipment of average 

23 efficiency of the same equipment type; 

24 ‘‘(C) in the case of consumption, other 

25 than consumption described in subparagraphs 


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1 (A) and (B), at an existing facility, consump2 tion at the facility during a base period of not 

3 less than 1 year; and 

4 ‘‘(D) in the case of consumption, other 

5 than consumption described in subparagraphs 

6 (A) and (B), at a new facility, consumption at 

7 a reference new facility of average efficiency for 

8 new facilities of the same type. 

9 ‘‘(10) ELECTRICITY SAVINGS.—The term ‘elec10 tricity savings’ means reductions in electricity con11 sumption or losses, as determined in accordance 

12 with regulations promulgated by the Secretary, 

13 that— 

14 ‘‘(A) are achieved through measures imple15 mented after the date of enactment of this sec16 tion; 

17 ‘‘(B) are additional to business-as-usual 

18 customer purchase practices and distribution 

19 system efficiency; 

20 ‘‘(C) the retail electricity supplier claiming 

21 or transferring the electricity savings has 

22 played a significant role in achieving; 

23 ‘‘(D) occur in the service territory of the 

24 retail electricity supplier claiming or transfer25 ring the electricity savings; and 


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1 ‘‘(E) are limited to— 

2 ‘‘(i) customer facility savings of elec3 tricity, adjusted to reflect any associated 

4 increase in fuel consumption at the facility; 

5 ‘‘(ii) reductions in distribution system 

6 losses of electricity achieved by a retail 

7 electricity supplier, as compared to losses 

8 that would occur with new distribution sys9 tem equipment of average efficiency; 

10 ‘‘(iii) CHP savings; 

11 ‘‘(iv) codes and standards savings of 

12 electricity; and 

13 ‘‘(v) fuel-switching energy savings 

14 that results in net savings of electricity. 

15 ‘‘(11) FUEL-SWITCHING ENERGY SAVINGS.— 

16 ‘‘(A) IN GENERAL.—The term ‘fuel-switch17 ing energy savings’ means net energy savings, 

18 calculated in accordance with subparagraph 

19 (B), from consumer switches from 1 energy 

20 source to another, as determined in accordance 

21 with regulations promulgated by the Secretary. 

22 ‘‘(B) CALCULATION.—For purposes of cal23 culating net energy savings under subparagraph 

24 (A)— 


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1 ‘‘(i) electricity consumption shall be 

2 evaluated based on the average additional 

3 quantity of fuel burned at power plants to 

4 supply each additional kilowatt-hour of 

5 electricity consumption in the region; 

6 ‘‘(ii) electricity and natural gas con7 sumption shall include losses in the trans8 mission and distribution systems; and 

9 ‘‘(iii) fuel-switching that does not re10 sult in net cost savings to the consumer 

11 shall not be counted. 

12 ‘‘(12) NATURAL GAS SAVINGS.—The term ‘nat13 ural gas savings’ means reductions in natural gas 

14 consumption or losses, as determined in accordance 

15 with regulations promulgated by the Secretary, 

16 that— 

17 ‘‘(A) are achieved through measures imple18 mented after the date of enactment of this sec19 tion; 

20 ‘‘(B) are additional to business-as-usual 

21 customer purchase practices and distribution 

22 system efficiency; 

23 ‘‘(C) the retail natural gas supplier claim24 ing or transferring the natural gas savings has 

25 played a significant role in achieving; 


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1 ‘‘(D) occur in the service territory of the 

2 retail natural gas supplier claiming or transfer3 ring the natural gas savings; and 

4 ‘‘(E) are limited to— 

5 ‘‘(i) customer facility savings of nat6 ural gas, adjusted to reflect any associated 

7 increase in electricity consumption or con8 sumption of other fuels at the facility; 

9 ‘‘(ii) reductions in leakage, operational 

10 losses, and consumption of natural gas to 

11 operate a gas distribution system, achieved 

12 by a retail natural gas supplier, as com13 pared to similar leakage, losses, and con14 sumption during a base period of not less 

15 than 1 year; 

16 ‘‘(iii) codes and standards savings of 

17 natural gas; and 

18 ‘‘(iv) fuel-switching energy savings 

19 that results in net savings of natural gas. 

20 ‘‘(13) PERFORMANCE STANDARD.—The term 

21 ‘performance standard’ means a standard— 

22 ‘‘(A) established for a calendar year for cu23 mulative electricity savings or cumulative nat24 ural gas savings that is expressed as a percent25 age of base quantity; and 


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1 ‘‘(B) for each of calendar years 2021 

2 through 2035, that is labeled as cumulative 

3 electricity savings percentage or cumulative nat4 ural gas savings, as applicable, in the table 

5 under subsection (c)(2). 

6 ‘‘(14) POWER POOL.—The term ‘power pool’ 

7 means an association of two or more interconnected 

8 electric systems that have entered into an agreement 

9 to coordinate operations and planning for improved 

10 reliability and efficiencies, including a Regional 

11 Transmission Organization or an Independent Sys12 tem Operator, as determined by the Secretary. 

13 ‘‘(15) REPORTING PERIOD.—The term ‘report14 ing period’ means— 

15 ‘‘(A) calendar years 2021 through 2023; 

16 and 

17 ‘‘(B) each successive 2-calendar-year pe18 riod thereafter. 

19 ‘‘(16) RETAIL ELECTRICITY SUPPLIER.— 

20 ‘‘(A) IN GENERAL.—The term ‘retail elec21 tricity supplier’ means, for any calendar year, 

22 an electric utility that delivered not fewer than 

23 1,000,000 megawatt hours of electricity to elec24 tric consumers for purposes other than resale 

25 during the preceding calendar year. 


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1 ‘‘(B) INCLUSIONS AND LIMITATIONS.—For 

2 purposes of determining whether an electric 

3 utility qualifies as a retail electricity supplier 

4 under subparagraph (A)— 

5 ‘‘(i) deliveries by any affiliate of the 

6 electric utility to electric consumers for 

7 purposes other than resale shall be consid8 ered to be deliveries by the electric utility; 

9 and 

10 ‘‘(ii) deliveries by any electric utility 

11 to a lessee, tenant, or affiliate of the elec12 tric utility shall not be considered to be de13 liveries to electric consumers. 

14 ‘‘(17) RETAIL NATURAL GAS SUPPLIER.— 

15 ‘‘(A) IN GENERAL.—The term ‘retail nat16 ural gas supplier’ means, for any given calendar 

17 year, a local distribution company (as defined 

18 in section 2 of the Natural Gas Policy Act of 

19 1978), that delivered to natural gas consumers 

20 more than 5,000,000,000 cubic feet of natural 

21 gas for purposes other than resale during the 

22 preceding calendar year. 

23 ‘‘(B) INCLUSIONS AND LIMITATIONS.—For 

24 purposes of determining whether a person 


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1 qualifies as a retail natural gas supplier under 

2 subparagraph (A)— 

3 ‘‘(i) deliveries of natural gas by any 

4 affiliate of a local distribution company to 

5 consumers for purposes other than resale 

6 shall be considered to be deliveries by the 

7 local distribution company; and 

8 ‘‘(ii) deliveries of natural gas to a les9 see, tenant, or affiliate of a local distribu10 tion company shall not be considered to be 

11 deliveries to natural gas consumers. 

12 ‘‘(18) STATE REGULATORY AUTHORITY.—The 

13 term ‘State regulatory authority’ means any State 

14 agency which has ratemaking authority with respect 

15 to— 

16 ‘‘(A) the sale of natural gas by any gas 

17 utility (other than by such State agency); or 

18 ‘‘(B) the sale of electric energy by any 

19 electric utility (other than such State agency), 

20 and in the case of an electric utility with re21 spect to which the Tennessee Valley Authority 

22 has ratemaking authority, such term means the 

23 Tennessee Valley Authority. 

24 ‘‘(19) THIRD-PARTY EFFICIENCY PROVIDER.— 

25 The term ‘third-party efficiency provider’ means any 


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1 retailer, building owner, energy service company, fi2 nancial institution, or other commercial, industrial, 

3 or nonprofit entity that is capable of providing elec4 tricity savings or natural gas savings in accordance 

5 with subsections (d) and (e). 

6 ‘‘(20) WASTE HEAT ENERGY SAVINGS.— 

7 ‘‘(A) IN GENERAL.—The term ‘waste heat 

8 energy savings’ means a reduction in electricity 

9 or natural gas consumption that results from a 

10 modification of an industrial or commercial sys11 tem that commenced operation before the date 

12 of enactment of this section, in order to recap13 ture electrical, mechanical, or thermal energy 

14 that would otherwise be wasted, as determined 

15 in accordance with regulations promulgated by 

16 the Secretary. 

17 ‘‘(B) INCLUSION.—Waste heat energy sav18 ings shall be included as part of customer facil19 ity savings. 

20 ‘‘(b) ESTABLISHMENT.— 

21 ‘‘(1) REGULATIONS.—Not later than 1 year 

22 after the date of enactment of this section, the Sec23 retary shall, by regulation, establish a program to 

24 implement and enforce the requirements of this sec25 tion, including by— 


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1 ‘‘(A) establishing measurement and 

2 verification procedures and standards under 

3 subsection (e); 

4 ‘‘(B) establishing requirements under 

5 which retail electricity suppliers and retail nat6 ural gas suppliers shall— 

7 ‘‘(i) demonstrate, document, and re8 port the compliance of the retail electricity 

9 suppliers and retail natural gas suppliers 

10 with the performance standards under sub11 section (c); and 

12 ‘‘(ii) estimate the impact of the per13 formance standards on current and future 

14 electricity and natural gas consumption in 

15 the service territories of the suppliers; and 

16 ‘‘(C) establishing requirements governing 

17 applications for, and implementation of, State 

18 programs under subsection (g). 

19 ‘‘(2) COORDINATION WITH STATE PROGRAMS.— 

20 In establishing and implementing this section, the 

21 Secretary shall, to the maximum extent practicable, 

22 preserve the integrity and incorporate best practices 

23 of existing State energy efficiency programs. 

24 ‘‘(c) PERFORMANCE STANDARDS.— 


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1 ‘‘(1) COMPLIANCE OBLIGATION.—Not later 

2 than May 1 of the calendar year immediately fol3 lowing each reporting period— 

4 ‘‘(A) each retail electricity supplier shall 

5 submit to the Secretary a report, in accordance 

6 with regulations promulgated by the Secretary, 

7 demonstrating that such retail electricity sup8 plier has achieved cumulative electricity savings 

9 (adjusted to account for any attrition of savings 

10 from measures implemented in prior years) in 

11 each calendar year of such reporting period that 

12 are equal to or greater than the applicable per13 formance standard; and 

14 ‘‘(B) each retail natural gas supplier shall 

15 submit to the Secretary a report, in accordance 

16 with regulations promulgated by the Secretary, 

17 demonstrating that the retail natural gas sup18 plier has achieved cumulative natural gas sav19 ings from measures (adjusted to account for 

20 any attrition of savings measures implemented 

21 in prior years) in each calendar year of such re22 porting period that are equal to or greater than 

23 the applicable performance standard. 

24 ‘‘(2) PERFORMANCE STANDARDS FOR 2021

25 THROUGH 2035.—For each of calendar years 2021 


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1 through 2035, the performance standards are as fol2 lows: 

‘‘Calendar Year Cumulative Electricity 

Savings Percentage 

Cumulative Natural Gas 

Savings Percentage 

2021 1.00 0.50 

2022 2.00 1.25 

2023 3.00 2.00 

2024 4.25 3.00 

2025 5.50 4.00 

2026 7.00 5.00 

2027 8.50 6.00 

2028 10.00 7.00 

2029 11.50 8.00 

2030 13.00 9.00 

2031 14.75 10.00 

2032 16.50 11.00 

2033 18.25 12.00 

2034 20.00 13.00 

2035 22.00 14.00 

3 ‘‘(3) SUBSEQUENT YEARS.— 

4 ‘‘(A) CALENDAR YEARS 2036 THROUGH

5 2045.—Not later than December 31, 2033, the 

6 Secretary shall promulgate regulations estab7 lishing performance standards for each of cal8 endar years 2036 through 2045. 

9 ‘‘(B) SUBSEQUENT EXTENSIONS.—Except 

10 as provided in subparagraph (A), not later than 

11 the last day of the penultimate reporting period 

12 for which performance standards have been esVerDate Sep 11 2014 02:13 Jan 10, 2021 Jkt 019200 PO 00000 Frm 00045 Fmt 6652 Sfmt 6201 E:\BILLS\H9036.IH H9036

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1 tablished under this paragraph, the Secretary 

2 shall promulgate regulations establishing per3 formance standards for the 10-calendar-year 

4 period following the last calendar year for which 

5 performance standards previously were estab6 lished. 

7 ‘‘(C) REQUIREMENTS.—The Secretary 

8 shall establish performance standards under 

9 this paragraph at levels reflecting the maximum 

10 achievable level of cost-effective energy effi11 ciency potential, taking into account— 

12 ‘‘(i) cost-effective energy savings 

13 achieved by leading retail electricity sup14 pliers and retail natural gas suppliers; 

15 ‘‘(ii) opportunities for new codes and 

16 standards savings; 

17 ‘‘(iii) technology improvements; and 

18 ‘‘(iv) other indicators of cost-effective 

19 energy efficiency potential. 

20 ‘‘(D) MINIMUM PERCENTAGE.—In no case 

21 shall a performance standard established under 

22 this paragraph for any calendar year be less 

23 than the applicable performance standard for 

24 calendar year 2035 (including any increase in 


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1 the standard for calendar year 2035 established 

2 pursuant to paragraph (4)). 

3 ‘‘(4) MIDCOURSE REVIEW AND ADJUSTMENT OF

4 PERFORMANCE STANDARDS.— 

5 ‘‘(A) IN GENERAL.—Not later than De6 cember 31, 2029, and at 10-year intervals 

7 thereafter, the Secretary shall— 

8 ‘‘(i) review the most recent perform9 ance standards established under para10 graph (2) or (3); and 

11 ‘‘(ii) increase the performance stand12 ards by regulation if the Secretary deter13 mines that additional cost-effective energy 

14 efficiency potential is achievable, taking 

15 into account the requirements described in 

16 paragraph (3)(C). 

17 ‘‘(B) LEAD TIME.—If the Secretary revises 

18 performance standards under this paragraph, 

19 the regulations shall provide adequate lead time 

20 to ensure that compliance with the increased 

21 performance standards is feasible. 

22 ‘‘(5) DELAY OF SUBMISSION FOR FIRST RE23 PORTING PERIOD.— 

24 ‘‘(A) IN GENERAL.—Notwithstanding 

25 paragraphs (1) and (2), for the first reporting 


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1 period, the Secretary may accept a request from 

2 a retail electricity supplier or a retail natural 

3 gas supplier to delay the required submission of 

4 documentation of all or part of the required 

5 savings for up to 2 years. 

6 ‘‘(B) PLAN FOR COMPLIANCE.—The re7 quest for delay under subparagraph (A) shall 

8 include a plan for coming into full compliance 

9 by the end of the second reporting period. 

10 ‘‘(6) APPLYING UNUSED SAVINGS TO FUTURE

11 YEARS.—If electricity savings or natural gas savings 

12 achieved by a retail electricity supplier or retail nat13 ural gas supplier in a year exceed the applicable per14 formance standard specified under this subsection, 

15 any savings in excess of the performance standard 

16 may be applied toward performance standards speci17 fied for any of the 2 immediately subsequent compli18 ance years. 

19 ‘‘(d) TRANSFERS OF ELECTRICITY OR NATURAL GAS

20 SAVINGS.— 

21 ‘‘(1) BILATERAL CONTRACTS FOR SAVINGS

22 TRANSFERS.—Subject to the limitations of this sub23 section, a retail electricity supplier or retail natural 

24 gas supplier may use electricity savings or natural 

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1 tract from another retail electricity supplier or retail 

2 natural gas supplier, a State, or a third-party effi3 ciency provider to meet the applicable performance 

4 standard under subsection (c). 

5 ‘‘(2) REQUIREMENTS.—Electricity savings or 

6 natural gas savings purchased and used for compli7 ance under this subsection shall be— 

8 ‘‘(A) measured and verified in accordance 

9 with subsection (e); 

10 ‘‘(B) reported in accordance with sub11 section (c); and 

12 ‘‘(C) achieved within the same State as is 

13 served by the retail electricity supplier or retail 

14 natural gas supplier. 

15 ‘‘(3) EXCEPTION.—Notwithstanding paragraph 

16 (2)(C), a State regulatory authority may authorize a 

17 retail electricity supplier or a retail natural gas sup18 plier regulated by the State regulatory authority to 

19 purchase savings achieved in a different State, if— 

20 ‘‘(A) the savings are achieved within the 

21 same power pool; and 

22 ‘‘(B) the State regulatory authority that 

23 regulates the purchaser oversees the measure24 ment and verification of the savings pursuant to 


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1 the procedures and standards applicable in the 

2 State in which the purchaser is located. 

3 ‘‘(4) REGULATORY APPROVAL.—Nothing in this 

4 subsection limits or affects the authority of a State 

5 regulatory authority to require a retail electricity 

6 supplier or retail natural gas supplier that is regu7 lated by the State regulatory authority to obtain the 

8 authorization or approval of the State regulatory au9 thority of a contract for transfer of electricity sav10 ings or natural gas savings under this subsection. 

11 ‘‘(5) LIMITATIONS.—To optimize the achieve12 ment of cost-effective efficiency potential, the Sec13 retary may prescribe such limitations as the Sec14 retary determines appropriate with respect to the 

15 proportion of the compliance obligation of a retail 

16 electricity or natural gas supplier under the applica17 ble performance standards under subsection (c) that 

18 may be met using electricity savings or natural gas 

19 savings that are purchased under this subsection. 

20 ‘‘(e) EVALUATION, MEASUREMENT, AND

21 VERIFICATION OF SAVINGS.— 

22 ‘‘(1) REGULATIONS.—The regulations promul23 gated pursuant to subsection (b) shall— 

24 ‘‘(A) be based on— 


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1 ‘‘(i) the Uniform Methods Project of 

2 the Department of Energy; 

3 ‘‘(ii) the National Standard Practice 

4 Manual for Assessing the Cost-Effective5 ness of Energy Efficiency Resources, devel6 oped by the National Efficiency Screening 

7 Project; and 

8 ‘‘(iii) other best practices recognized 

9 in the energy efficiency industry; and 

10 ‘‘(B) include— 

11 ‘‘(i) procedures and standards for 

12 evaluating, measuring, and verifying elec13 tricity savings and natural gas savings that 

14 count towards the performance standards 

15 established under subsection (c) that— 

16 ‘‘(I) specify the types of energy 

17 efficiency and energy conservation 

18 measures that may be counted; 

19 ‘‘(II) require that energy con20 sumption estimates for customer fa21 cilities or portions of facilities in the 

22 applicable base and current years be 

23 adjusted, as appropriate, to account 

24 for changes in weather, level of pro25 duction, and building area; 


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1 ‘‘(III) do not prevent overall load 

2 growth due to beneficial electrifica3 tion; 

4 ‘‘(IV) account for the useful life 

5 of energy efficiency and energy con6 servation measures; 

7 ‘‘(V) allow for savings from a 

8 program to be estimated based on ex9 trapolation from a representative sam10 ple of participating customers; 

11 ‘‘(VI) include procedures for cal12 culating and documenting CHP sav13 ings, fuel-switching energy savings, 

14 and waste heat energy savings; 

15 ‘‘(VII) establish methods for cal16 culating codes and standards energy 

17 savings, including— 

18 ‘‘(aa) the use of verified 

19 compliance rates; 

20 ‘‘(bb) requiring that the 

21 baseline for calculating savings 

22 from building energy codes shall 

23 be the more stringent of— 

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1 tion Code for residential 

2 buildings, or the ASHRAE/ 

3 ANSI/ IESNA Standard 

4 90.1–2016 for commercial 

5 buildings; or 

6 ‘‘(BB) the applicable 

7 State building code in effect 

8 on the date of enactment of 

9 this section; and 

10 ‘‘(cc) requiring that the 

11 baseline for calculating savings 

12 from appliance and equipment 

13 standards shall be the average ef14 ficiency of new appliances and 

15 equipment in the applicable one 

16 or more categories prior to the 

17 adoption and implementation of 

18 the new standard; 

19 ‘‘(VIII) include procedures for 

20 calculating and documenting— 

21 ‘‘(aa) customer facility sav22 ings and reductions in distribu23 tion system losses of electricity 

24 and natural gas that are achieved 

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1 ment, as described in section 

2 1301 of the Energy Independ3 ence and Security Act of 2007; 

4 and 

5 ‘‘(bb) reductions in natural 

6 gas distribution system losses at7 tributable to pipeline repair and 

8 replacement programs; 

9 ‘‘(IX) count only measures and 

10 savings that are additional to busi11 ness-as-usual customer purchase prac12 tices; 

13 ‘‘(X) ensure that the retail elec14 tricity supplier or retail natural gas 

15 supplier claiming the electricity sav16 ings or natural gas savings, including 

17 State and local codes and standards 

18 savings, has played a significant role 

19 in achieving the savings (including 

20 through the activities of a designated 

21 agent of the supplier); 

22 ‘‘(XI) avoid double-counting of 

23 savings used for compliance with this 

24 section, including transferred savings; 


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1 ‘‘(XII) include electricity savings 

2 or natural gas savings from programs 

3 administered by retail electricity sup4 pliers or natural gas suppliers that 

5 are funded by Federal, State, or other 

6 sources, unless the funding source 

7 specifies otherwise; 

8 ‘‘(XIII) credit large customer 

9 self-directed electricity savings or nat10 ural gas savings to the retail elec11 tricity supplier or retail natural gas 

12 supplier if the large customer receives 

13 incentives or rate reductions from the 

14 retail electricity supplier or retail nat15 ural gas supplier for self-directed en16 ergy efficiency improvements; 

17 ‘‘(XIV) include guidance, as ap18 propriate, for additional alternative 

19 approaches to evaluate electricity sav20 ings and natural gas savings for large 

21 commercial and industrial customers 

22 in energy-intensive industries that are 

23 subject to international competition; 

24 ‘‘(XV) include procedures for 

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1 ural gas savings achieved by solar 

2 heating and cooling technologies, solar 

3 light pipe technology, geothermal heat 

4 pumps, and other technologies uti5 lizing renewable resources that do not 

6 produce electricity or gaseous fuel and 

7 reduce on-site energy consumption; 

8 ‘‘(XVI) include procedures for 

9 counting electricity savings and nat10 ural gas savings achieved by weather11 ization measures, such as installing 

12 mechanical insulation, repairing or re13 placing heating and cooling systems, 

14 repairing or replacing windows and 

15 doors, performing air sealing, and re16 placing lights and appliances with 

17 more energy efficient models; 

18 ‘‘(XVII) include procedures for 

19 counting electricity savings and nat20 ural gas savings achieved from in21 creased utilization of mechanical insu22 lation for new, retrofit, and mainte23 nance construction for commercial, in24 dustrial, public, and nonprofit build25 ings and facilities; 


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1 ‘‘(XVIII) in any State in which 

2 the State regulatory authority has 

3 designated 1 or more entities to ad4 minister electric ratepayer-funded effi5 ciency programs approved by the 

6 State regulatory authority, provide 

7 that electricity savings and natural 

8 gas savings achieved through those 

9 programs shall be distributed propor10 tionally among retail electricity sup11 pliers and retail natural gas suppliers; 

12 ‘‘(XIX) include guidance for re13 tail electricity suppliers and retail nat14 ural gas suppliers to calculate and 

15 document business-as-usual consump16 tion projections; 

17 ‘‘(XX) include guidance for esti18 mating savings using information 

19 from the database established under 

20 paragraph (3) based on similar meas21 ures and programs in other settings 

22 with appropriate adjustments, as nec23 essary; and 


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1 ‘‘(XXI) incorporate advances in 

2 the science of policy evaluation, such 

3 as the use of— 

4 ‘‘(aa) randomized control 

5 trials; 

6 ‘‘(bb) other experimental 

7 and quasi-experimental ap8 proaches; and 

9 ‘‘(cc) large data sets and 

10 machine learning techniques; and 

11 ‘‘(ii) procedures and standards for 

12 third-party verification of reported elec13 tricity savings or natural gas savings. 

14 ‘‘(2) NATIONAL ACADEMY OF SCIENCES

15 STUDY.—Not later than 180 days after the date of 

16 enactment of this section, the Secretary shall offer 

17 to enter into an agreement with the National Acad18 emy of Sciences, under which the Academy shall— 

19 ‘‘(A) evaluate existing state-of-the-art 

20 methods for evaluating energy efficiency policies 

21 and measures; 

22 ‘‘(B) identify approaches in program eval23 uation literature that may be brought into the 

24 energy efficiency domain, including— 


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1 ‘‘(i) randomized control trials and 

2 other experimental or quasi-experimental 

3 approaches; 

4 ‘‘(ii) control of confounding factors; 

5 ‘‘(iii) longitudinal studies; 

6 ‘‘(iv) assessments by neutral arbiters; 

7 and 

8 ‘‘(v) disclosure of data for replication; 

9 and 

10 ‘‘(C) not later than 18 months after the 

11 date of enactment of this section, publish a re12 port that includes— 

13 ‘‘(i) a description of the evaluation 

14 under subparagraph (A); 

15 ‘‘(ii) a description of the approaches 

16 identified under subparagraph (B); and 

17 ‘‘(iii) recommendations for advancing 

18 and adopting rigorous state-of-the-art 

19 methods for evaluating energy efficiency 

20 policies and measures. 

21 ‘‘(3) ENERGY EFFICIENCY PROGRAM EVALUA22 TION DATABASE.— 

23 ‘‘(A) IN GENERAL.—The Secretary shall 

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1 ment of Energy, that contains a list of random2 ized control trials and other experimental or 

3 quasi-experimental evaluations of energy effi4 ciency programs. 

5 ‘‘(B) REQUIREMENTS.—Each trial or eval6 uation on the list described in subparagraph 

7 (A) shall include, at a minimum— 

8 ‘‘(i) the State in which the trial or 

9 evaluation was conducted; 

10 ‘‘(ii) the type of trial or evaluation 

11 conducted; 

12 ‘‘(iii) the type of program evaluated; 

13 ‘‘(iv) an abstract or summary of the 

14 program evaluated; 

15 ‘‘(v) a summary of the trial or evalua16 tion methodology; 

17 ‘‘(vi) the revealed energy savings from 

18 the trial or evaluation; and 

19 ‘‘(vii) to the extent practicable, the 

20 underlying data used to conduct the trial 

21 or evaluation. 

22 ‘‘(f) ENFORCEMENT AND JUDICIAL REVIEW.— 

23 ‘‘(1) REVIEW OF RETAIL SUPPLIER REPORTS.— 

24 ‘‘(A) IN GENERAL.—The Secretary shall 

25 review each report submitted to the Secretary 


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1 by a retail electricity supplier or retail natural 

2 gas supplier under subsection (c) to verify that 

3 the applicable performance standards under 

4 subsection (c) have been met. 

5 ‘‘(B) EXCLUSION.—In determining compli6 ance with the applicable performance standards 

7 under subsection (c), the Secretary shall ex8 clude reported electricity savings or natural gas 

9 savings that are not adequately demonstrated 

10 and documented, in accordance with the regula11 tions promulgated under this section. 

12 ‘‘(2) PENALTY FOR FAILURE TO DOCUMENT

13 ADEQUATE SAVINGS.—If a retail electricity supplier 

14 or a retail natural gas supplier fails to demonstrate 

15 compliance with an applicable performance standard 

16 under subsection (c), or to pay to the State an appli17 cable alternative compliance payment under sub18 section (g), the Secretary shall assess against the re19 tail electricity supplier or retail natural gas supplier 

20 a civil penalty in an amount equal to, as adjusted 

21 for inflation in accordance with such regulations as 

22 the Secretary may promulgate— 

23 ‘‘(A) $100 per megawatt hour of electricity 

24 savings or alternative compliance payment that 


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1 the retail electricity supplier failed to achieve or 

2 make, respectively; or 

3 ‘‘(B) $10 per million Btu of natural gas 

4 savings or alternative compliance payment that 

5 the retail natural gas supplier failed to achieve 

6 or make, respectively. 

7 ‘‘(3) OFFSETTING STATE PENALTIES.—The 

8 Secretary shall reduce the amount of any penalty 

9 under paragraph (2) by the amount paid by the rel10 evant retail electricity supplier or retail natural gas 

11 supplier to a State for failure to comply with the re12 quirements of a State energy efficiency resource 

13 standard during the same compliance period, if the 

14 State standard— 

15 ‘‘(A) is comparable in type to the Federal 

16 performance standard established under this 

17 section; and 

18 ‘‘(B) is more stringent than the applicable 

19 performance standard under subsection (c). 

20 ‘‘(4) USE OF PAYMENTS.— 

21 ‘‘(A) DEFINITION OF COVERED RATE.—In 

22 this paragraph, the term ‘covered rate’ means 

23 the proportion that— 

24 ‘‘(i) the amount of penalty payments 

25 made by retail electricity suppliers and 


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1 natural gas suppliers in a State under 

2 paragraph (2); bears to 

3 ‘‘(ii) the total amount of penalty pay4 ments collected by the Secretary under 

5 that paragraph. 

6 ‘‘(B) USE OF PAYMENTS.—Penalty pay7 ments collected under paragraph (2) by the 

8 Secretary shall be— 

9 ‘‘(i) provided to each State at the cov10 ered rate for the State; and 

11 ‘‘(ii) used by the State to implement 

12 cost-effective energy efficiency programs 

13 that— 

14 ‘‘(I) to the maximum extent prac15 ticable, achieve electricity savings and 

16 natural gas savings in the State suffi17 cient to make up the deficit associated 

18 with the penalty payments; and 

19 ‘‘(II) are measured and verified 

20 in accordance with the applicable pro21 cedures and standards established 

22 under subsection (e). 

23 ‘‘(5) ENFORCEMENT PROCEDURES.—The Sec24 retary shall assess a civil penalty, as provided under 

25 paragraph (2), in accordance with the procedures 


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1 described in section 333(d) of the Energy Policy and 

2 Conservation Act. 

3 ‘‘(6) JUDICIAL REVIEW.— 

4 ‘‘(A) IN GENERAL.—Any person adversely 

5 affected by a final action taken by the Sec6 retary under this section, other than the assess7 ment of a civil penalty, may use the procedures 

8 for review described in section 336(b) of the 

9 Energy Policy and Conservation Act. 

10 ‘‘(B) REFERENCE.—In this paragraph, 

11 references to a rule in section 336(b) of the En12 ergy Policy and Conservation Act shall be con13 sidered to refer also to all other final actions of 

14 the Secretary under this section other than the 

15 assessment of a civil penalty. 

16 ‘‘(g) STATE ADMINISTRATION.— 

17 ‘‘(1) IN GENERAL.—Upon receipt of an applica18 tion from the Governor of a State (including the 

19 Mayor of the District of Columbia), the Secretary 

20 may authorize the State to implement a State en21 ergy efficiency program in lieu of the Federal pro22 gram established under subsection (b) if the Sec23 retary determines that the requirements of such 

24 State program meet or exceed the requirements of 

25 such Federal program, including— 


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1 ‘‘(A) achieving electricity savings and nat2 ural gas savings that are equal to or greater 

3 than savings required under the applicable per4 formance standards established under sub5 section (c); 

6 ‘‘(B) reviewing reports and verifying elec7 tricity savings and natural gas savings achieved 

8 in the State (including savings transferred from 

9 outside the State); and 

10 ‘‘(C) if applicable, collecting any alter11 native compliance payments under paragraph 

12 (4) and using the payments to implement cost13 effective efficiency programs. 

14 ‘‘(2) SECRETARIAL DETERMINATION.—Not 

15 later than 180 days after the date on which a com16 plete application is received by the Secretary under 

17 this subsection, the Secretary after public notice and 

18 opportunity for comment shall determine whether to 

19 approve or disapprove such application. 

20 ‘‘(3) ALTERNATIVE MEASUREMENT AND

21 VERIFICATION PROCEDURES AND STANDARDS.—As 

22 part of an application pursuant to paragraph (1), a 

23 State may request to use alternative measurement 

24 and verification procedures and standards from the 

25 procedures and standards described in subsection 


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1 (e), if the State demonstrates that the alternative 

2 procedures and standards provide a level of accuracy 

3 of measurement and verification that are at least 

4 equivalent to the Federal procedures and standards 

5 under subsection (e). 

6 ‘‘(4) ALTERNATIVE COMPLIANCE PAYMENTS.— 

7 ‘‘(A) IN GENERAL.—As part of an applica8 tion submitted under paragraph (1), a State 

9 may permit retail electricity suppliers or retail 

10 natural gas suppliers to pay to the State, by 

11 not later than May 1 of the calendar year im12 mediately following the applicable reporting pe13 riod, an alternative compliance payment in an 

14 amount equal to, as adjusted for inflation in ac15 cordance with such regulations as the Secretary 

16 may promulgate, not less than— 

17 ‘‘(i) $50 per megawatt hour of elec18 tricity savings needed to make up any def19 icit in achieving electricity savings that 

20 would otherwise be required under the ap21 plicable performance standard established 

22 under subsection (c); or 

23 ‘‘(ii) $5 per million Btu of natural gas 

24 savings needed to make up any deficit in 

25 achieving natural gas savings that would 


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1 otherwise be required under the applicable 

2 performance standard established under 

3 subsection (c). 

4 ‘‘(B) USE OF PAYMENTS.—Alternative 

5 compliance payments collected by a State under 

6 subparagraph (A) shall be used by the State to 

7 implement the State program authorized under 

8 this section and to implement cost-effective en9 ergy efficiency programs that— 

10 ‘‘(i) to the maximum extent prac11 ticable, achieve electricity savings and nat12 ural gas savings in the State sufficient to 

13 make up the deficit associated with the al14 ternative compliance payments; and 

15 ‘‘(ii) can be measured and verified in 

16 accordance with the applicable procedures 

17 and standards under subsection (e) or 

18 paragraph (3), as applicable. 

19 ‘‘(5) REVIEW OF STATE PROGRAM.— 

20 ‘‘(A) PERIODIC REVIEW.—Every 2 years, 

21 the Secretary shall review State programs authorized under this section in approximately 1 22 ⁄2

23 of the States with such authorized State pro24 grams, so that each such State program shall 

25 be reviewed at least every 4 years. 


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1 ‘‘(B) REPORT.—To facilitate review under 

2 subparagraph (A), the Secretary may require a 

3 State to submit a report demonstrating the 

4 State program authorized under this section 

5 meets the requirements of this section, includ6 ing— 

7 ‘‘(i) reports submitted by retail elec8 tricity suppliers and retail natural gas sup9 pliers to the State demonstrating compli10 ance with applicable requirements; 

11 ‘‘(ii) the impact of applicable require12 ments on projected electricity and natural 

13 gas demand within the State; 

14 ‘‘(iii) an accounting of the use of al15 ternative compliance payments by the 

16 State and the resulting electricity savings 

17 and natural gas savings achieved; and 

18 ‘‘(iv) any other information that the 

19 Secretary determines appropriate. 

20 ‘‘(C) REVIEW UPON PETITION.—Notwith21 standing subparagraph (A), upon receipt of a 

22 public petition containing credible allegation of 

23 substantial deficiencies of a State program au24 thorized under this section, the Secretary shall 

25 promptly re-review the State program. 


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1 ‘‘(D) DEFICIENCIES.— 

2 ‘‘(i) IN GENERAL.—In completing a 

3 review of a State program authorized 

4 under this section, if the Secretary finds 

5 deficiencies, the Secretary shall— 

6 ‘‘(I) notify the State of the defi7 ciencies; 

8 ‘‘(II) direct the State to correct 

9 the deficiencies; and 

10 ‘‘(III) require the State to report 

11 to the Secretary on progress made by 

12 not later than 180 days after the date 

13 on which the State receives notice 

14 under subclause (I). 

15 ‘‘(ii) SUBSTANTIAL DEFICIENCIES.—If 

16 the deficiencies are substantial, the Sec17 retary shall— 

18 ‘‘(I) disallow the reported elec19 tricity savings or natural gas savings 

20 that the Secretary determines are not 

21 credible due to deficiencies; 

22 ‘‘(II) re-review the State program 

23 2 years after the date on which the 

24 original review was completed; and 


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1 ‘‘(III) if substantial deficiencies 

2 remain uncorrected after the review 

3 provided for under subclause (II), re4 voke the authorization for the State to 

5 implement a State program under this 

6 section. 

7 ‘‘(6) CALLS FOR REVISION OF STATE APPLICA8 TIONS.—As a condition of maintaining the author9 ization to implement a State program under this 

10 section, the Secretary may require the State to sub11 mit a revised application under paragraph (1) if the 

12 Secretary has— 

13 ‘‘(A) established new or revised perform14 ance standards under subsection (c); 

15 ‘‘(B) promulgated new or substantially re16 vised measurement and verification procedures 

17 and standards under subsection (e); or 

18 ‘‘(C) otherwise substantially revised the 

19 Federal program established under this section. 

20 ‘‘(h) INFORMATION AND REPORTS.—In accordance 

21 with section 13 of the Federal Energy Administration Act 

22 of 1974, the Secretary may require any retail electricity 

23 supplier, retail natural gas supplier, third-party efficiency 

24 provider, or any other entity that the Secretary determines 


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1 appropriate, to provide any information the Secretary de2 termines appropriate to carry out this section. 

3 ‘‘(i) COST RECOVERY, FIXED COST RECOVERY, AND

4 SHAREHOLDER INCENTIVES.—Each State regulatory au5 thority is encouraged to review the rules and regulations 

6 of the State regulatory authority to ensure that utilities 

7 under its jurisdiction can— 

8 ‘‘(1) recover the direct costs of energy efficiency 

9 programs; 

10 ‘‘(2) fully recover authorized fixed costs, includ11 ing lost margins from lower annual sales due to en12 ergy efficiency programs; and 

13 ‘‘(3) earn an incentive for shareholders if the 

14 energy efficiency standards are achieved. 

15 ‘‘(j) STATE LAW.—Nothing in this section diminishes 

16 or qualifies any authority of a State or political subdivision 

17 of a State to adopt or enforce any law or regulation re18 specting electricity savings or natural gas savings, includ19 ing any law or regulation establishing energy efficiency re20 quirements that are more stringent than those under this 

21 section, except that no State law or regulation shall relieve 

22 any person of any requirement otherwise applicable under 

23 this section.’’. 


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1 SEC. 6. PROGRAM REVIEW. 

2 (a) NATIONAL ACADEMY OF SCIENCES REVIEW.— 

3 The Secretary of Energy shall enter into a contract with 

4 the National Academy of Sciences under which the Na5 tional Academy of Sciences shall, not later than July 1, 

6 2025, and every 10 years thereafter, submit to Congress, 

7 the Federal Energy Regulatory Commission, and the Sec8 retary of Energy a comprehensive evaluation of the imple9 mentation (including outcomes) of sections 610 and 611 

10 of the Public Utility Regulatory Policies Act of 1978 (as 

11 added by this Act), including— 

12 (1) an evaluation of the effectiveness of imple13 mentation of such sections, including the specific de14 sign elements used in increasing the efficiency of re15 tail natural gas and electricity distribution and con16 sumption and increasing the deployment of renew17 able electricity capacity; 

18 (2) the opportunities for additional technologies 

19 and sources of efficiency and renewable electricity 

20 that have emerged since the date of enactment of 

21 this Act; 

22 (3) the impact of implementation of such sec23 tions on the reliability of electricity and natural gas 

24 supply; 


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1 (4) the net benefits or costs of the implementa2 tion of such sections to the United States and the 

3 States, including— 

4 (A) the effects on electricity and natural 

5 gas demand and prices; 

6 (B) the economic development benefits of 

7 investment; 

8 (C) environmental costs and benefits; 

9 (D) the impacts on public health and 

10 health care costs; and 

11 (E) avoided costs related to environmental 

12 and congestion mitigation investments that oth13 erwise would have been required; 

14 (5) an assessment of the benefits and costs of 

15 increasing the performance standards established 

16 under section 611(c) of the Public Utility Regulatory 

17 Policies Act of 1978 (as added by this Act); 

18 (6) the feasibility, advantages, and disadvan19 tages of alternative models for demonstrating com20 pliance with a Federal energy efficiency resource 

21 standard, including— 

22 (A) establishing a national trading system 

23 for energy efficiency credits; or 

24 (B) demonstrating compliance through re25 ductions in the projected amount of electricity 


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1 and natural gas delivered by retail electricity 

2 suppliers and retail natural gas suppliers, rath3 er than on measured and verified electricity 

4 savings and natural gas savings; and 

5 (7) recommendations regarding potential 

6 changes to implementing such sections, including 

7 changes to regulations and procedures, or to related 

8 public policies. 

9 (b) RECOMMENDATIONS TO CONGRESS.—Not later 

10 than January 1, 2026, and every 10 years thereafter, the 

11 Secretary of Energy shall submit to the Committee on En12 ergy and Commerce of the House of Representatives and 

13 the Committee on Energy and Natural Resources of the 

14 Senate a report making recommendations for modifica15 tions and improvements to implementation of sections 610 

16 and 611 of the Public Utility Regulatory Policies Act of 

17 1978 (as added by this Act), including an explanation of 

18 the inconsistencies, if any, between the recommendations 

19 of the Secretary of Energy and the recommendations in20 cluded in the most recent evaluation by the National Acad21 emy of Sciences under subsection (a). 

22 SEC. 7. CONFORMING AMENDMENT. 

23 The table of contents of the Public Utility Regulatory 

24 Policies Act of 1978 (16 U.S.C. prec. 2601) is amended 


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1 by adding at the end of the items relating to title VI the 

2 following: 

‘‘Sec. 609. Rural and remote communities electrification grants. 

‘‘Sec. 610. Federal renewable electricity standard. 

‘‘Sec. 611. Federal energy efficiency resource standard for retail electricity and 

natural gas suppliers.’’. 

Æ 


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