HB4097 - 572R

Be it enacted by the Legislature of the State of Arizona:

Section 1. Title 40, chapter 2, article 1, Arizona Revised Statutes, is amended by adding section 40-207, to read:

START_STATUTE40-207. Large customer self-supply; dedicated generation; registration; limitations; definitions

A. A large customer may obtain electricity through dedicated generation and self-supply by using a self-supply facility and private lines. This section does not:

1. Authorize a person to provide retail electric service to the general public or to customers who are not listed in subsection B of this section.

2. Establish a general retail choice program.

B. A self-supply facility and private lines that are authorized by this section may serve only:

1. The large customer.

2. An eligible affiliated load if either of the following applies:

(a) the served loads are within a single integrated site or campus that is under common control.

(b) Any colocation or tenant load is served under bundled service as described in subsection C of this section.

C. A large customer that owns or controls a site may provide electricity from a self-supply facility to colocation tenants on the site if all the following apply:

1. The tenant is not separately billed on a per kilowatt hour basis.

2. The tenant does not receive a separate electricity invoice or tariffed electric rate from the large customer or self-supply operator.

3. The eLECTRICITY is provided only as an incidental bundled component of the tenant's rent, license or managed services.

D. If electricity is separately metered and sold, resold, redistributed or retransmitted as a distinct commodity to multiple nonaffiliated end users, the provider is not eligible under this section and shall comply with applicable laws that govern public service corporations and certificates of convenience and necessity.

E. Before commencing construction of a self-supply facility that is intended to serve load within the certificated service TERRITORY of an electric distribution utility or public service corporation, a large customer or self-supply operator shall file a self-supply registration with the commission. The self-supply registration must include:

1. The large customer's identity and site locations.

2. The planned peak demand and load profile.

3. The technology type, name plate capacity and expected in-service date.

4. A one line diagram that shows whether the facility is behind-the-meter, grid tied or islandable.

5. Whether the project will interconnect with the incumbent utility and, if so, the requested interconnection voltage and point of interconnection.

6. An attestation, under penalty of perjury, that the self-supply facility will only serve load pursuant to the requirements of subsections B and C of this section and will not sell electricity to the public.

7. Evidence of compliance with applicable environmental and local permitting requirements or a plan and schedule for obtaining the permits.

F. The registrant shall provide a copy of the self-supply registration to the incumbent electric distribution UTILITY serving the site.

G. Within sixty days after a complete self-supply registration is filed, the commission shall issue a written determination that the project either:

1. Qualifies as self-supply pursuant to this section.

2. Does not qualify as self-supply because the project would constitute furnishing electricity to the public or otherwise require a CERTIFICATE of convenience and necessity under this title.

H. If the commission does not issue a written deficiency notice within TWENTY days after FILING, the self-supply registration is deemed complete. If the commission does not issue a written determination within sixty days after the self-supply registration is complete, the self-supply registration is deemed approved.

I. The commission's determination under subsection G of this section is limited to whether the proposal qualifies under subsections B and C of this section and whether the proposal, as registered, would require a certificate of convenience and necessity as a public service corporation.

J. A self-supply facility may be any of the following:

1. Behind-the-meter without export.

2. Grid tied with or without export, subject to tariffs and interconnection requirements.

3. Islandable to serve the load during grid outages, subject to applicable safety standards.

K. If the self-supply facility interconnects with an incumbent utility, the registrant shall:

1. Comply with applicable interconnection standards.

2. Pay the reasonable and prudent costs of interconnection and any dedicated upgrades that are caused by the project, consistent with commission-approved tariffs.

L. This section does not:

1. Require an INCUMBENT utility to provide standby, backup or supplemental service on terms other than those in approved tariffs and does not prohibit the incumbent utility from offering the service.

2. Grant a self-supply operator the right to use public streets or public rights-of-way to furnish ELECTRICITY to the public.

3. Alter any incumbent utility's duty to serve other customers within its service territory or alter existing service territory boundaries.

M. If the commission determines after notice and an opportunity for a hearing that a REGISTRANT has violated subsection B or C of this section by selling electricity to disallowed users as a commodity, the commission may revoke the registrant's self-supply registration or order the registrant to cease and desist from the UNAUTHORIZEd furnishing of ELECTRICITY. Revocation under this subsection does not limit other remedies available by law.

N. THe commission may adopt rules to administer this section that:

1. Shall be consistent with the scope of review prescribed in subsection I of this section.

2. May not impose requirements that unreasonably delay or burden qualifying self-supply projects.

O. For the purposes of this section:

1. "DEDICATED GENERATION" MEANS GENERATION CAPACITY AND ASSOCIATED FACILITIES that are DEVELOPED FOR THE PRIMARY PURPOSE OF SERVING THE LARGE CUSTOMER UNDER THIS SECTION, WHETHER LOCATED ON THE SAME PARCEL AS THE CUSTOMER LOAD OR ON A DIFFERENT SITE WITHIN THIS STATE, if THE ELECTRICITY iS DELIVERED ONLY AS AUTHORIZED PURSUANT TO THIS SECTION.

2. "eLIGIBLE AFFILIATED LOAD":

(a) MEANS ADDITIONAL LOAD THAT MAY BE SERVED WITHOUT CAUSING THE ACTIVITY TO BE TREATED AS FURNISHING ELECTRICITY TO THE PUBLIC FOR THE PURPOSES OF aRTICLE xv, sECTION 2, cONSTITUTION of Arizona.

(b) INCLUDES:

(i) LOAD of the large customer's parent, subsidiary or affiliate under common control.

(ii) Load that is located on the same site and that is operated as part of an integrated campus under common control.

(c) In the case of colocation or managed service ARRANGEMENTS, tenant load that is located on the same site only if ELECTRICITY CHARGES are not unbundled and separately sold as a metered commodity and are instead included as a bundled component of rent or services.

3. "Large customer" means a retail end-use customer with a DEMONSTRATED or planned peak demand of either:

(a) At least twenty-five megawatts at a single site within this state.

(b) Another threshold as determined by the commission except that the threshold must be at least ten megawatts.

4. "Private line" means electrical facilities that are owned, leased, controlled or operated by a large customer or a self-supply operator under contract with the large customer, that do not provide distribution service to the general public and that are used solely to serve the large customer and eligible affiliated load authorized by this section.

5. "self-supply" means the generation, storage and delivery of electricity that is intended solely for consumption by a large customer and its eligible affiliated load and that is not for sale to the public.

6. "Self-supply facility" means one or more generation units, energy storage RESOURCES and related equipment, together with private lines and interconnection equipment, that are used to provide self-supply.

7. "Self-supply operator" means an entity that owns or operates a self-supply facility on behalf of a large customer under contract and that is prohibited from furnishing ELECTRICITY except as authorized by this section.

P. This section does not affect or modify the commission's constitutional and statutory authority. END_STATUTE

Sec. 2. Section 40-281, Arizona Revised Statutes, is amended to read:

START_STATUTE40-281. Certificate required before construction by public service corporation; exceptions; complaint by corporation injuriously affected by construction hearing; exclusive franchise or monopoly

A. A public service corporation, other than a railroad, shall not begin construction of a street railroad, a line, plant, service or system, or any extension thereof, without first having obtained from the commission a certificate of public convenience and necessity.

B. This section shall does not require such corporation to secure a certificate for an extension within a city, county or town within which it has lawfully commenced operations, or for an extension into territory either within or without a city, county or town, contiguous to its street railroad or line, plant or system, and not served by a public service corporation of like character, or for an extension within or to territory already served by it, necessary in the ordinary course of its business. If a public service corporation, in constructing or extending its line, plant or system, interferes or is about to interfere with the operation of the line, plant or system of any other public service corporation already constructed, the commission, on complaint of the corporation claiming to be injuriously affected, may, after hearing, may make an order and prescribe terms and conditions for the location of lines, plants or systems affected as it deems just and reasonable.

C. No such A public service corporation shall not exercise any right or privilege under any franchise or permit without first having obtained from the commission a certificate of public convenience and necessity.

D. This article shall does not be construed as granting or as having granted grant to any telecommunications corporation an exclusive franchise or monopoly within the territory described by its certificate unless the commission determines after notice and hearing that such an exclusive franchise or monopoly is in the public interest.

E. When the commission determines after notice and hearing that any product or service of a telecommunications corporation is neither essential nor integral to the public service rendered by such the telecommunications corporation, it the commission shall declare that such product or service is not subject to regulation by the commission.

F. This section does not require a certificate of public convenience and necessity for the construction or operation of a self-supply facility that is registered and approved under section 40-207 and that does not furnish electricity to the public. END_STATUTE

Sec. 3. Short title

This act may be cited as the "Bring Your Own Power Bill Act".