Pennsylvania’s RPS Becomes Law

It’s official. With a signature from Governor Edward Rendell, Pennsylvania has joined the growing list of states that require their utilities to source a small, but certain percentage of energy from renewable sources like solar, wind, and others.

Senate Bill 1030, sponsored by Sen. Edwin B. Erickson (R-Delaware), establishes the Alternative Energy Portfolio Standards Act, more broadly known as a Renewable Portfolio Standard (RPS). The bill provides that for the next 15 years, a percentage of the electric energy sold by an electric distribution company or electric generation supplier to retail customers in the Commonwealth is to be comprised of electricity generated from alternative energy sources. The alternative energy is to come from two “tiers” of sources, and each tier has a different percentage target. By the end of 15 years, 8 percent of electric energy is to be derived from Tier One sources- including solar photovoltaic energy, wind power, low impact hydropower, geothermal energy, biologically derived methane gas, fuel cells, biomass energy, and coal mine methane; while 10 percent is to be derived from Tier Two sources-including waste coal, distributed generation systems, demand-side management, large scale hydropower, municipal solid waste, by-products of wood manufacturing, and integrated combination gasification technology. Electric distribution companies do not have to comply with the portfolio standards requirements until their rate cap period ends or by 2010, whichever is earlier; and electric distribution companies and electric generation suppliers can petition the PUC if they believe that market conditions are such that they cannot meet the requirement. Finally, the PUC is required to set up a credits program to allow electric distribution companies and electric generation suppliers to acquire credits from an eligible resource or from other companies and suppliers to meet their requirements under the act. The bill was approved in the Senate, 32-15, and passed the House, 161-35. It takes effect in 90 days.
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