ENERGY COUNCIL
Newsletter

KATIE STONEWATER

Executive Director
Energy Council

 
 
312-386-7795

June 8, 2018

SPRINGFIELD OUT - ON TIME!
Session has ended, a budget has passed and been signed (on time!), and the election season has kicked off in full swing. Lawmakers indicate that the $38.5 billion budget is balanced through a combination of higher revenue and almost $600 million in cuts. This bipartisan full-year budget which was signed by the Governor on Monday, represents the first signed budget for Gov. Rauner.

State Rep. Greg Harris, the lead negotiator for House Democrats, released a very helpful summary of key funding priorities. Linked for your perusal.

By now, you should have received the Illinois Chamber's End of Session report, which we sent out the day after adjournment. If not, click here to see how the Illinois Chamber advocated for the business community this session. There was a lot, good and bad.   In the meantime, here's a highlight of where we ended up at the end of this session with some key bills in the energy and environment space:

SB 2213 (Biss/Stratton) would have required Illinois environmental laws and regulations, as well as workplace safety laws, remain as strict or more stringent than federal laws in place before January 19, 2017. This is bad policy for Illinois and would have made our state less competitive among our neighbors if certain environmental regulations were modified and Illinois could not comply. This bill would have sent the message that the State of Illinois is unwilling to consider making changes to laws or regulations to ease the regulatory burden on its business community. After leading the effort to defeat the bill in the Senate the first time it was brought up, the Chamber continued that work with a coalition of business and labor groups in keeping this bill from moving forward in the House.
 
SB 3005 (Raoul) would allow any "persons" to appeal or intervene in lawsuits challenging decisions of state agencies. This means that any person, Illinois resident or not, can be listed as an interested party in a proceeding, a power currently afforded to the agencies and plaintiff party requesting the proceeding. The legislation currently has been refined to apply only to permitting decisions by the Departments of Agriculture, Natural Resources, Transportation, Public Health, and the Environmental Protection Agency. It was understood the legislation could be further amended to impact the agriculture community only. The Chamber led a coalition of members in opposition of this legislation. There was a strong coalition of organizations, approximately thirty groups, opposed to the bill.

SB 3156 (Aquino/C. Mitchell) passed both Houses.  The bill required that Compliance Commitment Agreements (CCAs) be posted online within 30 days after taking effect.  The Chamber learned of instances where companies that have entered into CCA's with the IEPA are being sued, despite the good faith effort of entering into the CCA and trying to resolve the issue.  SB3156 would cause an increase in litigation on Illinois businesses. Therefore, we opposed the bill and offered an amendment that would add language to the bill that removes the threat of double jeopardy and provides that protection to companies to resolve their issues through the CCA instead of litigation by a third party. The bill passed without that amendment and the Chamber continues to work with the bill sponsors for alternatives to clarify this issue. The bill heads to the Governor's desk.  

SB 1531 (Harris) attempts to implement additional regulation on competitive energy suppliers and shift regulation of competitive retail energy market to the Attorney General's office, rather than the Illinois Commerce Commission. The bill started off very differently and the Chamber opposed many aspects of the bill. The bill was brought before the Illinois House on the last day of session and failed, but was postponed. The bill was referred back to the Rules Committee and could continue to evolve.

HB4236 (Phillips) would have required the inclusion of sourcing agreements between "clean coal facilities" and both utilities and alternative retail electric suppliers as part of each annual procurement plan from the IPA and ICC. The bill passed out of the House Agriculture after being moved from House Energy, but did not move past 2nd reading. Multiple fiscal notes were attached to the bill. We opposed this legislation.

SB 486 (Harmon/Currie) provides a standardized property tax value for commercial solar energy system. The bill passed both Houses and heads to the Governor's desk.

SB 3174 (Koehler) would prohibit wells that utilize horizontal or directional extensions from a vertical bore hole from classifying as confidential.  Currently, Illinois allows these wells to be classified as confidential for two years.   There is no need to reopen the fracking law past further interest in making it tougher for fracking to actually happen in Illinois.  The Chamber opposed and it was referred to a House Agriculture Subcommittee and not considered in the House.

HB 5564  (Moeller) would require compensation to be determined by a jury trial before access is given to land in eminent domain cases for certain industries.  This bill is similar to a bill that passed last session and advanced in subcommittee, but did not proceed in full Committee.  The Chamber opposed the bill and ultimately failed to pass committee.

Subject Matter Hearings : In addition to the above legislation, we saw subject matter hearings on the impact to solar tariffs (the Chamber testified); a Loyola-student presentation to the Senate Energy and Public Utilities and organized as a subject matter hearing on carbon pricing; and a Senate Energy subject matter hearing on the Renewable Energy Resource Fund and a slew of matters related to the rollout of the Adjustable Block Program through FEJA and its impact on low-income and other customers. Senators were very interested in holding another hearing over the summer on this subject.

Worth Noting: ICC Acting Commissioner Anastasia Palivos was not confirmed by the General Assembly during the last days of session. Her colleague, Ethan Kimbrel, was confirmed on May 29th.

NEXTGRID
The NextGrid process continues to move along. The Energy Council is engaged in three of the seven working groups and recently wrapped Working Group 4 - Customer and Community Participation meetings. Next stage is the drafting of the report. As I mentioned before, Working Group 4 had been very focused on residential customers and determining how they value electricity and the grid. The Chamber argued successfully that the group must also hear from business community customers. The last meeting on Tuesday heard from two customers about their priorities for the grid - a manufacturing facility and hospital customer. A detailed summary from the ICC will be posted on the website soon. In a high-level nutshell, the presenters stressed that maintaining the reliability and security of the grid were paramount, but in many ways improvements such as restructuring mandated programs like energy efficiency; increasing transparency in pricing; ensuring customers receive value for what they pay for; regulators require ROI studies for each new program; and, to quote a working group members summary comment "regulators need to proceed with caution before approving new programs/policies that could come from NextGrid."

Working Group 5 - Electricity Markets, met Monday and discussed transactive markets. My main takeaway from that discussion was that the system must be designed so everything has equal value of the system. How you achieve that through the regulatory framework, however, is the biggest challenge. Overall, the group is to consider ways to increase customer access and explore market-based platforms that the grid can enable.

Working Group 6 - Regulatory and Environmental Policy, met Wednesday and heard a presentation on the environmental impacts on distributed energy resources and then broke into small working groups on how distributed energy resources enable environmental goals and support the grid. Those sessions produced some interesting points and perspectives. The meeting notes will be posted to the working group website within the next week.

WASHINGTON D.C.
House Committee Holds Hearing on Electric Grid of the Future
The House Science, Space and Technology Subcommittee on Energy held a hearing on Wednesday to examine research programs at the Department of Energy that focus on electrical grid modernization, energy storage, and improving grid reliability and resiliency. Panelists explored the work of the national labs, various technology research around the country and the challenges that exist.  More information can be found at the Committee's website.  
 
White House Issues Directive to Bolster Coal and Nuclear Power 
The Trump Administration on June 1 st directed the Department of Energy to aid coal-fired and nuclear power plants. Earlier in the week, DOE had drafted a memo for the National Security Council indicating plans to use emergency powers to require grid operators to buy power or power capacity from at-risk plants. The Administration argues this action is essential for the reliability and resiliency of the power system, but critics quickly emerged disagreeing with the Administration's plans. No formal plans have been announced, but the Administration is trending in that way. FERC unanimously rejected DOE's initial effort to support coal and nuclear facilities and has directed RTO's to examine resiliency in their territories. More could develop.

IS AN EDIE AWARD IN YOUR FUTURE?
The Illinois Chamber of Commerce is now accepting nominations for the 10th Annual Economic Development in Illinois Awards - the Edies. The Edies honor outstanding economic development projects completed in the calendar year of 2017 that imagine, design, invest, build and bring jobs, growth and prosperity to Illinois communities. More information can be found at the  Edie homepage.

Nominations are being accepted now until 5 p.m. June 15, 2018. For additional questions, please contact Katie Stonewater at  kstonewater@ilchamber.org.

ICC WORKSHOP ON ENERGY STORAGE
Acting Commissioner Anastasia Palivos is hosting a Policy Session on energy storage. The session will feature panels discussing how energy storage integrates with the electric grid and consider the current legal and regulatory framework. The panelists will also examine practices in other states that Illinois could adopt. This will be a good look into possible policy considerations that could be proposed to the legislature and what changes to Illinois' current laws are needed for storage adaption.

The session is June 27, 2018 from 1:00 PM to 4:25 PM. It will be held in the Main Hearing Room, C-800, 8th Floor, ICC. No RSVP is necessary. More information, including the agenda, can be found at the ICC's website .

SAVE THE DATE: ILLINOIS CHAMBER ANNUAL LUNCHEON - UNION PACFIC'S LANCE FRITZ KEYNOTE
Mark September 20, 2018 in your calendar to join us at the Hilton Chicago for the 2018 Illinois Chamber of Commerce Annual Meeting. This fall Lance Fritz, the chairman, president, and chief executive officer of  Union Pacific Railroad will keynote this exciting event.
 
Union Pacific Railroad is one of two western-U.S. railroads that connects Illinois agriculture and industry to the West Coast and international markets. In addition, their heritage traces back to Abraham Lincoln, who signed the Pacific Railway Act of 1862, setting the wheels in motion that eventually connected the Pacific to the Mississippi River by rail-a fitting story for Illinois' bicentennial celebration!
 
Sponsorship opportunities are available and we look forward to seeing you there!

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Springfield, IL 62701

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