HB4: AN ACT relating to merchant electric generating facilities and making an appropriation therefor.

Legislative Summary

Amend KRS 278.702 to provide that the terms of service for the ad hoc members of the Kentucky State Board on Electric Generation and Transmission Siting end when the merchant electric generating facility for which they were appointed has been constructed and has begun generating electricity for sale or its construction certificate expires; amend KRS 278.704 to lengthen the period of time that a construction certificate for a merchant electric generating facility is valid from 2 years to 3 years; include decommissioning requirements within the requirements over which local planning and zoning requirements shall have primacy; remove outdated language; amend KRS 278.706 to require that a decommissioning plan be included in an application for construction of a merchant electric generating facility; establish minimum requirements for a decommissioning plan; require as part of a decommission plan that a bond or similar security be secured to assure that the decommissioning plan is accomplished; establish requirements for how the bond is set and how the beneficiaries of the bond are to be determined; require that certain components of the decommissioning plan be incorporated into the construction certificate applicant's leases with landowners; amend KRS 278.708 to reference the transfer of the enforcement authority for mitigation measures that are conditions of application approval from the board to the Energy and Environment Cabinet; amend KRS 278.710 to include whether the decommissioning plan is complete and complies with the requirements of the Act in the criteria for approval of a construction certificate for a merchant electric generating facility; require a person that has received a construction certificate for a merchant electric generating facility file with the Energy and Environment Cabinet the copy of the bond or similar security no later than the date that construction commences for the facility; require that an updated copy of the bond or similar security be refiled at least once every 5 years thereafter; require notice to be filed with the Energy and Environment Cabinet when the construction of the merchant electric generating facility is complete and has begun producing electricity for sale; require that notice be given of any transaction involving the sale or transfer of ownership of the facility to the Energy and Environment Cabinet and local officials within 10 days of finalizing the transaction; require a person who has acquired a merchant electric generating facility to file with the Energy and Environment Cabinet written consent to assume the obligations in the decommissioning plan for the facility and to adopt or replace the required decommissioning bond; provide that the transferor of control of a merchant electric generating facility remain liable for its decommissioning obligations until the transferee completes the documentation required by the Act and the secretary of the Energy and Environment cabinet accepts it as complete; provide that application approval conditions that require approval of transfer of control shall be void and unenforceable, subject to the requirements of the section; provide that after the application for a construction certificate for a merchant electric generating facility has been approved, the bond required by the Act has been posted, the facility has been constructed, and it has begun generating electricity for sale, the secretary of the Energy and Environment Cabinet shall ensure the facility's ongoing compliance with the requirements of KRS 278.700 to 278.716 and the conditions of its construction certificate approval, including updating its decommissioning plan and bond amounts at least once every 5 years; transfer the enforcement authority for mitigation measures that are conditions of application approval from the board to the Energy and Environment Cabinet once the facility is constructed and begins generating electricity for sale; require that while the electric merchant generating facility is operational, if solar panels are removed and discarded, the discarded solar panels be removed from the site within 90 days of the completion of the work; amend KRS 278.718 to provide that an ordinance, permit, or license issued by a local government shall have primacy over the requirements of KRS 278.700 and Sections 2, 3, and 4 of this Act; amend KRS 224.10-100 to authorize the Energy and Environment Cabinet to monitor and enforce compliance of merchant electric generating entities with the requirements of the Act; authorize the Energy and Environment Cabinet to draw upon a decommissioning bond or other similar security for which it is named a beneficiary to complete an approved decommissioning plan; amend KRS 224.99-010 to give jurisdiction to the Circuit Court in any county where a merchant electric generating facility is located for actions arising from or related to certain provisions of the Act; allow for a civil penalty not to exceed $2,500 per day to be imposed for violation of the bonding and bond transfer requirements in the Act; allow for the suspension of a merchant electric generating facility's operations for failing to pay civil penalties or complying with the bonding transfer requirements of the Act; allow for the decommissioning of the facility if it is still noncompliant after 90 days of suspension of its operation; create a new section of Subchapter 10 of KRS Chapter 224 to require that if a merchant electric facility fails to complete its decommissioning plan within 18 months of ceasing to produce electricity for sale, then the cabinet shall draw upon the decommissioning bond and implement the decommissioning plan; require the Energy and Environment Cabinet within 90 days of the effective date of the Act to promulgate administrative regulations to establish the monitoring and enforcement of the bonding and bond transfer requirements of the Act; allow the Energy and Environment Cabinet to establish a fee structure to cover the costs of its enforcement responsibilities; establish the merchant electric generating facility monitoring and enforcement fund to receive the fees and penalties collected by the Energy and Environment Cabinet pursuant to their monitoring and enforcement responsibilities under the Act; require that the funds collected only be used to defray the Energy and Environment Cabinet's costs related to their monitoring and enforcement responsibilities under the Act; require that all expenses for the determination of the bond amount and for the procurement of decommissioning services by the Energy and Environment be paid by the owner of the merchant electric generating facility; APPROPRIATION.