[Congressional Bills 114th Congress]
[From the U.S. Government Publishing Office]
[S. 1258 Introduced in Senate (IS)]
114th CONGRESS
1st Session
S. 1258
To require the Secretary of Energy to establish a distributed energy
loan program and technical assistance and grant program, and for other
purposes.
_______________________________________________________________________
IN THE SENATE OF THE UNITED STATES
May 7, 2015
Mr. Franken introduced the following bill; which was read twice and
referred to the Committee on Energy and Natural Resources
_______________________________________________________________________
A BILL
To require the Secretary of Energy to establish a distributed energy
loan program and technical assistance and grant program, and for other
purposes.
Be it enacted by the Senate and House of Representatives of the
United States of America in Congress assembled,
SECTION 1. SHORT TITLE.
This Act may be cited as the ``Local Energy Supply and Resiliency
Act of 2015''.
SEC. 2. DEFINITIONS.
In this Act:
(1) Combined heat and power system.--The term ``combined
heat and power system'' means generation of electric energy and
heat in a single, integrated system that meets the efficiency
criteria in clauses (ii) and (iii) of section 48(c)(3)(A) of
the Internal Revenue Code of 1986, under which heat that is
conventionally rejected is recovered and used to meet thermal
energy requirements.
(2) Demand response.--The term ``demand response'' means
changes in electric usage by electric utility customers from
the normal consumption patterns of the customers in response
to--
(A) changes in the price of electricity over time;
or
(B) incentive payments designed to induce lower
electricity use at times of high wholesale market
prices or when system reliability is jeopardized.
(3) Distributed energy.--The term ``distributed energy''
means energy sources and systems that--
(A) produce electric or thermal energy close to the
point of use using renewable energy resources or waste
thermal energy;
(B) generate electricity using a combined heat and
power system;
(C) distribute electricity in microgrids;
(D) store electric or thermal energy; or
(E) distribute thermal energy or transfer thermal
energy to building heating and cooling systems through
a district energy system.
(4) District energy system.--The term ``district energy
system'' means a system that provides thermal energy to
buildings and other energy consumers from 1 or more plants to
individual buildings to provide space heating, air
conditioning, domestic hot water, industrial process energy,
and other end uses.
(5) Islanding.--The term ``islanding'' means a distributed
generator or energy storage device continuing to power a
location in the absence of electric power from the primary
source.
(6) Loan.--The term ``loan'' has the meaning given the term
``direct loan'' in section 502 of the Federal Credit Reform Act
of 1990 (2 U.S.C. 661a).
(7) Microgrid.--The term ``microgrid'' means an integrated
energy system consisting of interconnected loads and
distributed energy resources, including generators and energy
storage devices, within clearly defined electrical boundaries
that--
(A) acts as a single controllable entity with
respect to the grid; and
(B) can connect and disconnect from the grid to
operate in both grid-connected mode and island mode.
(8) Renewable energy source.--The term ``renewable energy
source'' includes--
(A) biomass;
(B) geothermal energy;
(C) hydropower;
(D) landfill gas;
(E) municipal solid waste;
(F) ocean (including tidal, wave, current, and
thermal) energy;
(G) organic waste;
(H) photosynthetic processes;
(I) photovoltaic energy;
(J) solar energy; and
(K) wind.
(9) Renewable thermal energy.--The term ``renewable thermal
energy'' means heating or cooling energy derived from a
renewable energy resource.
(10) Secretary.--The term ``Secretary'' means the Secretary
of Energy.
(11) Thermal energy.--The term ``thermal energy'' means--
(A) heating energy in the form of hot water or
steam that is used to provide space heating, domestic
hot water, or process heat; or
(B) cooling energy in the form of chilled water,
ice, or other media that is used to provide air
conditioning, or process cooling.
(12) Waste thermal energy.--The term ``waste thermal
energy'' means energy that--
(A) is contained in--
(i) exhaust gases, exhaust steam, condenser
water, jacket cooling heat, or lubricating oil
in power generation systems;
(ii) exhaust heat, hot liquids, or flared
gas from any industrial process;
(iii) waste gas or industrial tail gas that
would otherwise be flared, incinerated, or
vented;
(iv) a pressure drop in any gas, excluding
any pressure drop to a condenser that
subsequently vents the resulting heat;
(v) condenser water from chilled water or
refrigeration plants; or
(vi) any other form of waste energy, as
determined by the Secretary; and
(B)(i) in the case of an existing facility, is not
being used; or
(ii) in the case of a new facility, is not
conventionally used in comparable systems.
SEC. 3. DISTRIBUTED ENERGY LOAN PROGRAM.
(a) Loan Program.--
(1) In general.--Subject to the provisions of this
subsection and subsections (b) and (c), the Secretary shall
establish a program to provide to eligible entities--
(A) loans for the deployment of distributed energy
systems in a specific project; and
(B) loans to provide funding for programs to
finance the deployment of multiple distributed energy
systems through a revolving loan fund, credit
enhancement program, or other financial assistance
program.
(2) Eligibility.--Entities eligible to receive a loan under
paragraph (1) include--
(A) a State, territory, or possession of the United
States;
(B) a State energy office;
(C) a tribal organization (as defined in section 4
of the Indian Self-Determination and Education
Assistance Act (25 U.S.C. 450b));
(D) an institution of higher education (as defined
in section 101 of the Higher Education Act of 1965 (20
U.S.C. 1001)); and
(E) an electric utility, including--
(i) a rural electric cooperative;
(ii) a municipally owned electric utility;
and
(iii) an investor-owned utility.
(3) Selection requirements.--In selecting eligible entities
to receive loans under this section, the Secretary shall, to
the maximum extent practicable, ensure--
(A) regional diversity among eligible entities to
receive loans under this section, including
participation by rural States and small States; and
(B) that specific projects selected for loans--
(i) expand on the existing technology
deployment program of the Department of Energy;
and
(ii) are designed to achieve 1 or more of
the objectives described in paragraph (4).
(4) Objectives.--Each deployment selected for a loan under
paragraph (1) shall include 1 or more of the following
objectives:
(A) Improved security and resiliency of energy
supply in the event of disruptions caused by extreme
weather events, grid equipment or software failure, or
terrorist acts.
(B) Implementation of distributed energy in order
to increase use of local renewable energy resources and
waste thermal energy sources.
(C) Enhanced feasibility of microgrids, demand
response, or islanding;
(D) Enhanced management of peak loads for consumers
and the grid.
(E) Enhanced reliability in rural areas, including
high energy cost rural areas.
(5) Restriction on use of funds.--Any eligible entity that
receives a loan under paragraph (1) may only use the loan to
fund programs relating to the deployment of distributed energy
systems.
(b) Loan Terms and Conditions.--
(1) Terms and conditions.--Notwithstanding any other
provision of law, in providing a loan under this section, the
Secretary shall provide the loan on such terms and conditions
as the Secretary determines, after consultation with the
Secretary of the Treasury, in accordance with this section.
(2) Specific appropriation.--No loan shall be made unless
an appropriation for the full amount of the loan has been
specifically provided for that purpose.
(3) Repayment.--No loan shall be made unless the Secretary
determines that there is reasonable prospect of repayment of
the principal and interest by the borrower of the loan.
(4) Interest rate.--A loan provided under this section
shall bear interest at a fixed rate that is equal or
approximately equal, in the determination of the Secretary, to
the interest rate for Treasury securities of comparable
maturity.
(5) Term.--The term of the loan shall require full
repayment over a period not to exceed the lesser of--
(A) 20 years; or
(B) 90 percent of the projected useful life of the
physical asset to be financed by the loan (as
determined by the Secretary).
(6) Use of payments.--Payments of principal and interest on
the loan shall--
(A) be retained by the Secretary to support energy
research and development activities; and
(B) remain available until expended, subject to
such conditions as are contained in annual
appropriations Acts.
(7) No penalty on early repayment.--The Secretary may not
assess any penalty for early repayment of a loan provided under
this section.
(8) Return of unused portion.--In order to receive a loan
under this section, an eligible entity shall agree to return to
the general fund of the Treasury any portion of the loan amount
that is unused by the eligible entity within a reasonable
period of time after the date of the disbursement of the loan,
as determined by the Secretary.
(9) Comparable wage rates.--Each laborer and mechanic
employed by a contractor or subcontractor in performance of
construction work financed, in whole or in part, by the loan
shall be paid wages at rates not less than the rates prevailing
on similar construction in the locality as determined by the
Secretary of Labor in accordance with subchapter IV of chapter
31 of title 40, United States Code.
(c) Rules and Procedures; Disbursement of Loans.--
(1) Rules and procedures.--Not later than 180 days after
the date of enactment of this Act, the Secretary shall adopt
rules and procedures for carrying out the loan program under
subsection (a).
(2) Disbursement of loans.--Not later than 1 year after the
date on which the rules and procedures under paragraph (1) are
established, the Secretary shall disburse the initial loans
provided under this section.
(d) Reports.--Not later than 2 years after the date of receipt of
the loan, and annually thereafter for the term of the loan, an eligible
entity that receives a loan under this section shall submit to the
Secretary a report describing the performance of each program and
activity carried out using the loan, including itemized loan
performance data.
(e) Authorization of Appropriations.--There are authorized to be
appropriated to carry out this section such sums as are necessary.
SEC. 4. TECHNICAL ASSISTANCE AND GRANT PROGRAM.
(a) Establishment.--
(1) In general.--The Secretary shall establish a technical
assistance and grant program (referred to in this section as
the ``program'')--
(A) to disseminate information and provide
technical assistance directly to eligible entities so
the eligible entities can identify, evaluate, plan, and
design distributed energy systems; and
(B) to make grants to eligible entities so that the
eligible entities may contract to obtain technical
assistance to identify, evaluate, plan, and design
distributed energy systems.
(2) Technical assistance.--The technical assistance
described in paragraph (1) shall include assistance with 1 or
more of the following activities relating to distributed energy
systems:
(A) Identification of opportunities to use
distributed energy systems.
(B) Assessment of technical and economic
characteristics.
(C) Utility interconnection.
(D) Permitting and siting issues.
(E) Business planning and financial analysis.
(F) Engineering design.
(3) Information dissemination.--The information
disseminated under paragraph (1)(A) shall include--
(A) information relating to the topics described in
paragraph (2), including case studies of successful
examples;
(B) computer software and databases for assessment,
design, and operation and maintenance of distributed
energy systems; and
(C) public databases that track the operation and
deployment of existing and planned distributed energy
systems.
(b) Eligibility.--Any nonprofit or for-profit entity shall be
eligible to receive technical assistance and grants under the program.
(c) Applications.--
(1) In general.--An eligible entity desiring technical
assistance or grants under the program shall submit to the
Secretary an application at such time, in such manner, and
containing such information as the Secretary may require.
(2) Application process.--The Secretary shall seek
applications for technical assistance and grants under the
program--
(A) on a competitive basis; and
(B) on a periodic basis, but not less frequently
than once every 12 months.
(3) Priorities.--In selecting eligible entities for
technical assistance and grants under the program, the
Secretary shall give priority to eligible entities with
projects that have the greatest potential for--
(A) facilitating the use of renewable energy
resources;
(B) strengthening the reliability and resiliency of
energy infrastructure to the impact of extreme weather
events, power grid failures, and interruptions in
supply of fossil fuels;
(C) improving the feasibility of microgrids or
islanding, particularly in rural areas, including high
energy cost rural areas;
(D) minimizing environmental impact, including
regulated air pollutants and greenhouse gas emissions;
and
(E) maximizing local job creation.
(d) Grants.--On application by an eligible entity, the Secretary
may award grants to the eligible entity to provide funds to cover not
more than--
(1) 100 percent of the costs of the initial assessment to
identify opportunities;
(2) 75 percent of the cost of feasibility studies to assess
the potential for the implementation;
(3) 60 percent of the cost of guidance on overcoming
barriers to implementation, including financial, contracting,
siting, and permitting issues; and
(4) 45 percent of the cost of detailed engineering.
(e) Rules and Procedures.--
(1) Rules.--Not later than 180 days after the date of
enactment of this Act, the Secretary shall adopt rules and
procedures for carrying out the program.
(2) Grants.--Not later than 120 days after the date of
issuance of the rules and procedures for the program, the
Secretary shall issue grants under this Act.
(f) Reports.--The Secretary shall submit to Congress and make
available to the public--
(1) not less frequently than once every 2 years, a report
describing the performance of the program under this section,
including a synthesis and analysis of the information provided
in the reports submitted to the Secretary under section 2(c);
and
(2) on termination of the program under this section, an
assessment of the success of, and education provided by, the
measures carried out by eligible entities during the term of
the program.
(g) Authorization of Appropriations.--There is authorized to be
appropriated to carry out this section $250,000,000 for the period of
fiscal years 2016 through 2020, to remain available until expended.
<all>