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<title>February 2005: DC Enacts Renewable Portfolio Standard</title>
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<p align="left"><strong><small><font face="Arial">About The Author:</font></small></strong></p>
<p align="left"><font face="Arial" style="font-size: 9pt">Robert A. Olson is a partner in the law firm of
Brown, Olson & Gould, P.C. which maintains a nationwide practice in energy law,
public utility law and related commercial transactions.</font></p>
<p><small><font face="Arial"><font style="font-size: 9pt">He can be reached at:</font><br>
<br>
<b><font color="#0000FF">Brown, Olson & Gould, PC</font></b><br>
2 Delta Drive<br>
Suite 301<br>
Concord, NH 03301<br>
<a href="mailto:[email protected]">[email protected]</a><br>
(603) 225-9716<br>
<a href="mailto:[email protected]"></a></font></small></p>
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<img src="../images/statelin.gif" alt="STATELINE by Robert Olson" border="0" width="375" height="75">
</center><p align="left"><b><u><br>
</u></b><u><b><br>
February 2005<br>
</b></u><font size="6"><b>DC Enacts Renewable Portfolio Standard<br>
</b></font><strong>by Robert Olson -- Brown, Olson and Wilson, P.C.<br>
</strong><font face="Arial" size="2">(<em>originally published by PMA OnLine Magazine:
200</em>5/05/06)</font></p>
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<p class="MsoNormal" align="left"><span style="font-family:Arial">On January
19, 2005, the District of Columbia enacted the Renewable Energy Portfolio
Standard Act of 2004 (the “Act”), subject to congressional review. The Act
requires all “electricity suppliers,” including all persons who generate
electricity, sell electricity, or purchase electricity for sale to retail
customers, to obtain an amount of “renewable energy credits” issued by the
PJM Interconnection regional transmission organization equal to a designated
percentage of their total District of Columbia retail sales, with each such
credit evidencing one megawatt-hour of electricity derived from specified
types of renewable sources located in the PJM Interconnection region or
adjacent states, or, if the electricity is delivered into the PJM
Interconnection region, located in an adjacent control area. For purposes of
satisfying the renewable portfolio standard, renewable energy credits exist
for 3 years from the date created.</span></p>
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<p class="MsoNormal" align="left"><span style="font-family:Arial">The
required percentage changes from year to year. For2007, the required
percentages are 1.5% for “tier one” renewable sources, 2.5% for “tier two”
renewable sources, and .005% for solar energy (which also qualifies as a
tier one renewable source). The required percentage for tier one renewable
sources and solar energy gradually increases each year until 2022; the
required percentage for tier two renewable sources remains constant at 2.5%
through 2016and then declines gradually to 0% in 2020. In 2022 and later
years, the required percentages are 11% for tier one, 0% for tier two, and
.386% for solar energy.</span></p>
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<p class="MsoNormal" align="left"><span style="font-family:Arial">In
addition to solar energy, tier one energy sources include wind, qualifying
biomass, methane, geothermal, and ocean energy sources. Tier two energy
sources include hydroelectric power and waste-to-energy energy sources. Tier
two requirements may also be satisfied by tier one energy sources.</span></p>
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<p class="MsoNormal" align="left"><span style="font-family:Arial">In
computing whether the required percentages are satisfied, certain tier one
renewable sources receive more favorable treatment than other tier one
sources. On or before December 31, 2006, an electricity supplier receives a
120%credit toward meeting the renewable energy portfolio standard for energy
derived from wind or solar sources and a110% credit for energy derived from
methane. From December31, 2006, through December 31, 2009, electricity
suppliers receive a 110% credit for energy derived from wind, solar, and
methane sources. With respect to tier two resources, incineration of solid
waste is given less favorable treatment than other tier two resources.
Incineration of solid waste may not be relied upon to meet more than 20%of
the requirement for tier two sources, and it may not be relied upon at all
after December 31, 2012.</span></p>
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<p class="MsoNormal" align="left"><span style="font-family:Arial">
Electricity suppliers who fail to produce the required amount of renewable
energy credits are required to pay a compliance fee of two and _ cents for
each kilowatt-hour of shortfall from required tier one renewable sources,
one cent for each kilowatt-hour of shortfall from required tier two
renewable sources, and 30 cents for each kilowatt-hour of shortfall from
required solar energy sources. Such compliance fee payments are applied to a
renewable energy development fund, which is dedicated to making loans and
grants to support the creation of new solar energy sources in the District
of Columbia.</span></p>
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<p class="MsoNormal" align="left"><span style="font-family:Arial">The Act
was transmitted for congressional review on February9, 2005. Absent a prior
joint congressional resolution disapproving the Act, the Act will take
effect and be published in the District of Columbia Register 30 calendar
days after transmittal, excluding weekends, holidays, and certain periods of
congressional adjournment. District of Columbia Home Rule Act, D.C. Official
Code � 1-206.02(c)(1).The Council of the District of Columbia projects that
the Act will take effect on April 14, 2005.</span></p>
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<p align="left"><font face="Arial">
<small>Robert A. Olson is a partner in the law firm of Brown, Olson &
Gould P.C.
which maintains a nationwide practice in energy law, public utility law and related
commercial transactions. He can be reached at:</small></font><p align="center">
<font face="Arial"><small><font color="#0000FF"><b>Brown, Olson & Gould, PC</b></font><br>
2 Delta Drive, Suite 301<br>
Concord, NH 03301 <br>
<br>
<a href="mailto:[email protected]">[email protected]</a> | (603) 225-9716<a href="mailto:[email protected]"></a></small></font>
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