220 ILCS 5/8-403.1
2021 Illinois Compiled Statutes|Chapter 220 - UTILITIES|220 ILCS 5/ - Public Utilities Act.|Article VIII - Service Obligations And Conditions

 (from Ch. 111 2/3, par. 8-403.1)Sec. 8-403.1. Electricity purchased from qualified solid waste energy  facility; tax credit; distributions for economic development.(a) It is hereby declared to be the policy of this State to encourage the  development of alternate energy production facilities in order to conserve our  energy resources and to provide for their most efficient use.(b) For the purpose of this Section and Section 9-215.1, "qualified  solid waste energy facility" means a facility determined by the  Illinois Commerce Commission to qualify as such under the Local Solid  Waste Disposal Act, to use methane gas generated from landfills as its  primary fuel, and to possess characteristics that would enable it to qualify  as a cogeneration or small power production facility under federal law.(c) In furtherance of the policy declared in this Section, the  Illinois Commerce Commission shall require electric utilities to enter into  long-term contracts to purchase electricity from qualified solid waste  energy facilities located in the electric utility's service area, for a  period beginning on the date that the facility begins generating  electricity and having a duration of not less than 10 years  in the case of facilities fueled by landfill-generated methane, or 20  years in the case of facilities fueled by methane generated from a landfill  owned by a forest preserve district.  The purchase rate contained in such  contracts shall be equal to the average amount per kilowatt-hour paid from  time to time by the unit or units of local government in which the  electricity generating facilities are located, excluding amounts paid for  street lighting and pumping service.(d) Whenever a public utility is required to purchase electricity  pursuant to subsection (c) above, it shall be entitled to credits in  respect of its obligations to remit to the State taxes it has  collected under the Electricity Excise Tax Law equal to the amounts,  if any, by which payments for such electricity  exceed (i) the then current rate at which the utility must purchase the  output of qualified facilities pursuant to the federal Public  Utility Regulatory Policies Act of 1978, less (ii) any costs, expenses, losses,  damages or other amounts incurred by the utility, or for which it becomes  liable, arising out of its failure to obtain such electricity from such other  sources.  The amount of any such  credit shall, in the first instance, be  determined by the utility, which shall make a monthly report of such credits  to the Illinois Commerce Commission and, on its monthly tax return, to the  Illinois Department of Revenue. Under no circumstances shall a utility be  required to purchase electricity from a qualified solid waste energy facility  at the rate prescribed in subsection (c) of this Section if such purchase would  result in estimated tax credits that exceed, on a monthly basis, the utility's  estimated obligation to remit to the State taxes it has  collected under the Electricity Excise Tax Law. The  owner or operator shall negotiate facility operating conditions with the  purchasing utility in accordance with that utility's posted standard terms and  conditions for small power producers. If the Department of Revenue disputes the  amount of any such credit, such dispute shall be decided by the Illinois  Commerce Commission.  Whenever a qualified solid waste energy facility has paid  or otherwise  satisfied in full the capital costs or indebtedness incurred in developing  and implementing the qualified solid waste energy facility, whenever the qualified solid waste energy facility ceases to operate and produce electricity from methane gas generated from landfills, or at the end of the contract entered into pursuant to subsection (c) of this Section, whichever occurs first, the qualified solid waste energy facility shall  reimburse the Public Utility Fund and the General Revenue  Fund in the State treasury for the actual  reduction in payments to those Funds caused by this  subsection (d) in a  manner to be determined by the Illinois Commerce Commission and based on  the manner in which revenues for those Funds were reduced. The payments shall be made to the Illinois Commerce Commission, which shall determine the appropriate disbursements to the Public Utility Fund and the General Revenue Fund based on this subsection (d).(e) The Illinois Commerce Commission shall not require an electric  utility to purchase electricity from any qualified solid waste energy facility  which is owned or operated by  an entity that is primarily engaged in the  business of producing or selling electricity, gas, or useful thermal energy  from a source other than one or more qualified solid waste energy facilities.(e-5) A qualified solid waste energy facility may receive the purchase rate provided in subsection (c) of this Section only for kilowatt-hours generated by the use of methane  gas generated from landfills.   The purchase rate provided in subsection (c) of this Section does not apply to electricity generated by the use of a fuel that is not methane gas generated from landfills.   If the Illinois Commerce Commission determines that a qualified solid waste energy facility has violated the requirement regarding the use of methane gas generated from a landfill as set forth in this subsection (e-5), then the Commission shall issue an order requiring that the qualified solid waste energy facility repay the State for all dollar amounts of electricity sales that are determined by the Commission to be the result of the violation.    As part of that order, the Commission shall have the authority to revoke the facility's approval to act as a qualified solid waste energy facility granted by the Commission under this Section. If the amount owed by the qualified solid waste energy facility is not received by the Commission within 90 days after the date of the Commission's order that requires repayment, then the Commission shall issue an order that revokes the facility's approval to act as a qualified solid waste energy facility granted by the Commission under this Section.  The Commission's action that vacates prior qualified solid waste energy facility approval does not excuse the repayment to the State treasury required by subsection (d) of this Section for utility tax credits accumulated up to the time of the Commission's action.    A qualified solid waste energy facility must receive Commission approval before it may use any fuel in addition to methane gas generated from a landfill in order to generate electricity.    If a qualified solid waste energy facility petitions the Commission to use any fuel in addition to methane gas generated from a landfill to generate electricity, then the Commission shall have the authority to do the following:(1) establish the methodology for determining the     amount of electricity that is generated by the use of methane gas generated from a landfill and the amount that is generated by the use of other fuel;(2) determine all reporting requirements for the     qualified solid waste energy facility that are necessary for the Commission to determine the amount of electricity that is generated by the use of methane gas from a landfill and the amount that is generated by the use of other fuel and the resulting payments to the qualified solid waste energy facility; and(3) require that the qualified solid waste energy     facility, at the qualified solid waste energy facility's expense, install metering equipment that the Commission determines  is necessary to enforce compliance with this subsection (e-5).A public utility that is required to enter into a long-term purchase contract with a qualified solid waste energy facility has no duty to determine whether the electricity being purchased was generated by the use of methane gas generated from a landfill or was generated by the use of some other fuel in violation of the requirements of this subsection (e-5).(f) This Section does not require an electric utility to construct  additional facilities unless those facilities are paid for by the owner or  operator of the affected qualified solid waste energy facility.(g) The Illinois Commerce Commission shall require that: (1) electric  utilities use the electricity purchased from a qualified solid waste  energy facility to displace electricity generated from nuclear power or  coal mined and purchased outside the boundaries of the State of Illinois  before displacing electricity generated from coal mined and purchased  within the State of Illinois, to the extent possible, and (2) electric  utilities report annually to the Commission on the extent of such  displacements.(h) Nothing in this Section is intended to cause an electric utility  that is required to purchase power hereunder to incur any economic loss as  a result of its purchase.  All amounts paid for power which a utility is  required to purchase pursuant to subparagraph (c) shall be deemed to be  costs prudently incurred for purposes of computing charges under rates  authorized by Section 9-220 of this Act.  Tax credits provided for herein  shall be reflected in charges made pursuant to rates so authorized to the  extent such credits are based upon a cost which is also reflected in such  charges.(i) Beginning in February 1999 and through January 2013, each qualified  solid waste energy facility that sells electricity to an electric utility at  the purchase rate described in subsection (c) shall file with the Department  of Revenue on or before the 15th of each month a form, prescribed by the  Department of Revenue, that states the number of kilowatt hours of electricity  for which payment was received at that purchase rate from electric utilities  in Illinois during the immediately  preceding month.  This form shall be accompanied by a payment from the  qualified solid waste energy facility in an amount equal to six-tenths of a  mill ($0.0006) per kilowatt hour of electricity stated on the form.  Beginning  on the effective date of this amendatory Act of the 92nd General  Assembly, a qualified solid waste energy facility must file the form required  under this subsection (i) before the 15th of each month regardless of whether  the facility received any payment in the previous month.  Payments received by  the Department of Revenue shall be deposited into the Municipal Economic  Development Fund, a trust fund created outside the State treasury.  The State Treasurer may invest the moneys in the Fund in any investment  authorized by the Public Funds Investment Act, and investment income shall be  deposited into and become part of the Fund.  Moneys in the Fund shall be used  by the State Treasurer as provided in subsection (j).Beginning on July 1, 2006 through January 31, 2013, each month the State Treasurer shall certify the following to the State Comptroller:(A) the amount received by the Department of Revenue     under this subsection (i) during the immediately preceding month; and(B) the amount received by the Department of Revenue     under this subsection (i) in the corresponding month in calendar year 2002.As soon as practicable after receiving the certification from the State Treasurer, the State Comptroller shall transfer from the General Revenue Fund to the Municipal Economic Development Fund in the State treasury an amount equal to the amount by which the amount calculated under item (B) of this paragraph exceeds the amount calculated under item (A) of this paragraph, if any.The obligation of a  qualified solid waste energy facility to make payments into the Municipal  Economic Development Fund shall terminate upon either: (1) expiration or  termination of a facility's contract to sell electricity to an electric  utility at the purchase rate described in subsection (c); or (2) entry  of an enforceable, final, and non-appealable order by a court of competent  jurisdiction that Public Act 89-448 is invalid.  Payments by a  qualified solid waste energy facility into the Municipal Economic Development  Fund do not relieve the qualified solid waste energy facility of its  obligation to reimburse the Public Utility Fund and the General Revenue Fund  for the actual reduction in payments  to those Funds as a result of credits received by electric utilities under  subsection (d).A qualified solid waste energy facility that fails to timely file the  requisite form and payment as required by this subsection (i) shall be subject  to penalties and interest in conformance with the provisions of the Illinois  Uniform Penalty and Interest Act.Every qualified solid waste energy facility subject to the provisions of this  subsection (i) shall keep and maintain records and books of its sales pursuant  to subsection (c), including payments received from those sales and the  corresponding tax payments made in accordance with this subsection (i), and for  purposes of enforcement of this subsection (i) all such books and records shall  be subject to inspection by the Department of Revenue or its duly authorized  agents or employees.When a qualified solid waste energy facility fails to file the form or make  the payment required under this subsection (i), the Department of Revenue, to  the extent that it is practical, may enforce the payment obligation in a manner  consistent with Section 5 of the Retailers' Occupation Tax Act, and if  necessary may impose and enforce a tax lien in a manner consistent with  Sections 5a, 5b, 5c, 5d, 5e, 5f,   5g, and 5i of the Retailers' Occupation Tax Act.  No tax lien may be imposed  or enforced, however, unless a qualified solid waste energy facility fails to  make the payment required under this subsection (i).  Only to the extent  necessary and for the purpose of enforcing this subsection (i), the Department  of Revenue may secure necessary information from a qualified solid waste energy  facility in a manner consistent with Section 10 of  the Retailers' Occupation Tax Act.All information received by the Department of Revenue in its administration  and enforcement of this subsection (i) shall be confidential in a manner  consistent with Section 11 of the Retailers' Occupation Tax Act.  The  Department of Revenue may adopt rules to implement the provisions of this  subsection (i).For purposes of implementing the maximum aggregate distribution provisions in  subsections (j) and (k), when a qualified solid waste energy facility makes a  late payment to the Department of Revenue for deposit into the Municipal  Economic Development Fund, that payment and deposit shall be attributed to the  month and corresponding quarter in which the payment should have been made, and  the Treasurer shall make retroactive distributions or refunds, as the case may  be, whenever such late payments so require.(j) The State Treasurer, without appropriation, must make distributions  immediately after January 15, April 15, July 15, and October 15 of each  year, up to maximum aggregate distributions of $500,000 for the distributions  made in the 4 quarters beginning with the April distribution and ending with  the January distribution,  from the Municipal Economic Development Fund to each city, village, or  incorporated town located in Cook County that has approved construction within its boundaries of an incinerator  that will burn recovered wood processed for fuel to generate electricity and will commence operation after 2009.  Total distributions in the  aggregate to all qualified cities, villages, and incorporated towns in the 4  quarters beginning with the April distribution and ending with the January  distribution shall not exceed $500,000.  The amount  of each distribution shall be determined pro rata based on the population of  the city, village, or incorporated town compared to the total population of all  cities, villages, and incorporated towns eligible to receive a distribution.  Distributions received by a city, village, or incorporated town must be held in  a separate account and may  be used only to promote and enhance industrial, commercial, residential,  service, transportation, and recreational activities and facilities within its  boundaries, thereby enhancing the employment opportunities, public health and  general welfare, and  economic development within the community, including administrative  expenditures exclusively to further these activities.  Distributions may also be used for cleanup of open dumping from vacant properties and the removal of structures condemned by the city, village, or incorporated town. These  funds, however, shall not be used by the city, village, or incorporated town,  directly or  indirectly, to purchase, lease, operate, or in any way subsidize the operation  of any incinerator, and these funds shall not be paid, directly  or indirectly, by the city, village, or incorporated town to the owner,  operator, lessee, shareholder, or bondholder of any incinerator.  Moreover, these funds shall not be used to pay attorneys fees in any litigation  relating to the validity of Public Act 89-448.  Nothing in  this Section prevents a city, village, or incorporated town from using other  corporate funds for any legitimate purpose.  For purposes of this subsection,  the term "municipal waste" has the meaning ascribed to it in Section 3.290 of the Environmental Protection Act.(k) If maximum aggregate distributions of $500,000 under subsection (j)  have been made after the January distribution from the Municipal Economic  Development Fund, then the balance in the Fund shall be refunded to the  qualified  solid waste energy facilities that made payments that were deposited into the  Fund during the previous 12-month period.  The refunds shall be prorated based  upon the facility's payments in relation to total payments for that 12-month  period.(l) Beginning January 1, 2000, and each January 1 thereafter, each city,  village, or incorporated town that received distributions from the Municipal  Economic Development Fund, continued to hold any of those distributions, or  made expenditures from those distributions during the immediately preceding  year shall submit to  a financial and compliance and program audit of those distributions performed  by the Auditor General at no cost to the city, village, or incorporated town  that received the distributions.  The audit should be completed by June 30 or  as soon thereafter as possible.  The audit shall be submitted to the State  Treasurer and those officers enumerated in Section 3-14 of the Illinois State  Auditing Act.  If the Auditor General finds that distributions have been expended in violation  of this Section, the Auditor General shall refer the matter to the Attorney  General.  The Attorney General may recover, in a civil action, 3 times the  amount of any distributions illegally expended.  For purposes of this subsection, the terms "financial audit," "compliance  audit", and "program audit" have the meanings ascribed to them in Sections 1-13  and 1-15 of the Illinois State Auditing Act.(m) On and after the effective date of this amendatory Act of the 94th General Assembly, beginning on the first date on which renewable energy certificates or other saleable representations are sold by a qualified solid waste energy facility, with or without  the electricity generated by the facility, and utilized by an electric utility or another electric supplier to comply with a renewable energy portfolio standard mandated by Illinois law or mandated by order of the Illinois Commerce Commission, that qualified solid waste energy facility may not sell electricity pursuant to this Section and shall be exempt from the requirements of subsections (a) through (l) of this Section, except that it shall remain obligated for any reimbursements required under subsection (d) of this Section. All of the provisions of this Section shall remain in full force and effect with respect to any qualified solid waste energy facility that sold electric energy pursuant to this Section at any time before July 1, 2006 and that does not sell renewable energy certificates or other saleable representations to meet the requirements of a renewable energy portfolio standard mandated by Illinois law or mandated by order of the Illinois Commerce Commission.(n) Notwithstanding any other provision of law to the contrary, beginning on July 1, 2006, the Illinois Commerce Commission shall not issue any order determining that a facility is a qualified solid waste energy facility unless the qualified solid waste energy facility was determined by the Illinois Commerce Commission to be a qualified solid waste energy facility before July 1, 2006. As a guide to the intent,    interpretation, and application of this amendatory Act of the    94th General Assembly, it is hereby declared to be the policy    of this State to honor each qualified solid waste energy facility    contract in existence on the effective date of this amendatory Act of    the 94th General Assembly if the qualified solid waste energy    facility continues to meet the requirements of this Section for    the duration of its respective contract term.(Source: P.A. 96-449, eff. 8-14-09.)