Sec. 202. Zero-emission electricity requirement
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Except as otherwise provided in this section, effective beginning with calendar year 2022, for each calendar year, not later than June 1 of the following calendar year, each retail electricity supplier shall submit to the Secretary a quantity of zero-emission electricity credits that is equal to— for each of calendar years 2022 and 2023, the quantity of zero-emission electricity credits determined under paragraph
(3)for the retail electricity supplier for such calendar year; and for calendar year 2024 and each calendar year thereafter, the average of the quantity of zero-emission electricity credits determined under paragraph
(3)for the retail electricity supplier for such calendar year and the two prior calendar years. Any retail electricity supplier that is an electric cooperative, a State, or any political subdivision of a State, may elect to enter into an agreement with another political subdivision of a State, an electric cooperative that has an obligation to serve such retail electricity supplier, or a generator to assign any reporting or compliance obligation under this title to such other political subdivision of a State, electric cooperative, or generator. An assignment made under this paragraph shall be established through a binding agreement executed among the relevant parties. For each calendar year, the Secretary shall determine a quantity of zero-emission electricity credits for a retail electricity supplier that is equal to the product obtained by multiplying— the total quantity of electric energy, in megawatt-hours, consumed by electric consumers of the retail electricity supplier during the calendar year, that is provided by the retail electricity supplier or by a behind-the-meter generation system, as reported under subsection (b); by the minimum percentage of zero-emission electricity for the calendar year. In calculating the total quantity of electric energy consumed by electric consumers of a retail electricity supplier under subparagraph (A)(i), the Secretary shall deduct a quantity, in megawatt-hours, determined in accordance with clause
(ii)to account for beneficial electrification-related reductions. The Secretary shall make a determination of the quantity of electric energy, in megawatt-hours, associated with beneficial electrification-related reductions for a retail electricity supplier for a calendar year. Such determination shall be made on the basis of— the carbon intensity of the electric energy sold by the retail electricity supplier that results in such beneficial electrification-related reductions; and the greenhouse gas emissions of power sources that are not electric energy that were replaced with electric energy provided by the retail electricity supplier which results in such beneficial electrification-related reductions. For any calendar year in which a generating unit that is owned by a retail electricity supplier has been designated a System Support Resource by the Federal Energy Regulatory Commission and is thereby required, by an Independent System Operator or Regional Transmission Organization, or under a State-regulated resource planning process, to remain in operation because retirement of the generating unit would harm the reliability of the electric energy transmission system, in calculating the total quantity of electric energy consumed by electric consumers of the retail electricity supplier under subparagraph (A)(i), the Secretary shall deduct the quantity of megawatt-hours of electricity generated by such generating unit during such calendar year. For each calendar year, the Secretary shall— analyze the market for zero-emission electricity credits in order to determine the average annual price of zero-emission electricity credits for the calendar year; determine whether the average annual price of a zero-emission electricity credit determined under subparagraph
(A)is less than half of the alternative compliance payment under subsection
(c)for the calendar year; and publish the determinations made under subparagraphs
(A)and
(B)by not later than January 31 of the year following the calendar year. In this subsection: Except as provided in clause (ii), the term annual percentage increase means, with respect to a retail electricity supplier, the product obtained by multiplying— the difference between 100 percent and the baseline zero-emission electricity percentage; by— 1/27 . Notwithstanding clause (i), beginning with calendar year 2025, if the Secretary determines under paragraph
(4)that the average annual price of a zero-emission electricity credit for each of the 3 calendar years prior to a calendar year (in this clause referred to as the applicable calendar year ) is less than one half of the respective alternative compliance payment for each of the 3 such prior calendar years, the annual percentage increase for the 1 calendar year that begins 4 years after the end of the applicable calendar year shall be twice the percentage described in clause (i). The term baseline zero-emission electricity percentage means, with respect to a retail electricity supplier, the average percentage of the electric energy consumed by all electric consumers of the retail electricity supplier that is zero-emission electricity during calendar years 2017, 2018, and 2019. For any retail electricity supplier served by an Independent System Operator or a Regional Transmission Organization, or participating in a joint unit commitment and centralized economic dispatch system regulated by the Federal Energy Regulatory Commission, the retail electricity supplier may elect to set its baseline zero-emission electricity percentage under clause
(i)on the basis of the zero-emission electricity and electric energy consumed by either— all electric consumers of the retail electricity supplier; or all electric consumers served by the Independent System Operator, Regional Transmission Organization, or the applicable joint unit commitment and centralized economic dispatch system that serves the retail electricity supplier. A retail electricity supplier shall inform the Secretary of its election under clause
(ii)not later than 180 days after the date of enactment of this Act. The term minimum percentage of zero-emission electricity means, with respect to a retail electricity supplier— for each of calendar years 2022 and 2023, the baseline zero-emission electricity percentage; for each of calendar years 2024 through 2050, the amount, not to exceed 100 percent, obtained by adding— the minimum percentage of zero-emission electricity for the previous calendar year; and the annual percentage increase; and for each calendar year after 2050, 100 percent. Effective beginning in calendar year 2022, each retail electricity supplier serving one or more behind-the-meter generation systems may, not later than January 1 of each calendar year, submit to the Secretary— verification of the carbon intensity of behind-the-meter generation systems connected to the retail electricity supplier; and the quantity of electric energy generated by each such behind-the-meter generation system that is consumed for a useful purpose by electric consumers served by the retail electricity supplier. A retail electricity supplier may satisfy the requirements of subsection
(a)with respect to a calendar year, in whole or in part, by submitting to the Secretary, in lieu of each zero-emission electricity credit that would otherwise be due, an alternative compliance payment equal to the amount determined for such calendar year in accordance with the following table, adjusted for inflation: Calendar year Alternative compliance payment 2022 $20.00 2023 $21.50 2024 $23.00 2025 $24.50 2026 $26.00 2027 $27.50 2028 $29.00 2029 $30.50 2030 $32.00 2031 $33.50 2032 $35.00 2033 $36.50 2034 $38.00 2035 $39.50 2036 $41.00 2037 $42.50 2038 $44.00 2039 $45.50 2040 $47.00 2041 $48.50 2042 $50.00 2043 $51.50 2044 $53.00 2045 $54.50 2046 $56.00 2047 $57.50 2048 $59.00 2049 $60.50 2050 and each calendar year thereafter $62.00. A retail electricity supplier (referred to in this subsection as the petitioner ) may submit to the Secretary a petition for the Secretary to make a determination of inadequate availability of technology relating to zero-emission electricity with respect to a calendar year. The Secretary shall make an affirmative determination under paragraph
(1)(referred to in this title as a determination of inadequate availability of technology ) for a calendar year only if— a petition is submitted to the Secretary by January 31 of the following calendar year; the average annual price of zero-emission electricity credits is equal to or greater than the alternative compliance payment under subsection
(c)for such calendar year; the Secretary determines the number of megawatt-hours of zero-emission electricity that could have been generated or purchased by the petitioner using technology that was available during such calendar year— at or below the cost per megawatt-hour of the technology used to generate the electricity sold by the petitioner in the previous calendar year; and while enabling the petitioner to operate its system at an adequate level of reliability; and the number of megawatt-hours determined under subparagraph
(C)is less than the number of zero-emission electricity credits the petitioner would be required to submit under subsection (a). Notwithstanding subsection (a)(1), if the Secretary makes a determination of inadequate availability of technology for a petitioner for a calendar year, as described under this subsection, the petitioner shall not be required to submit for such calendar year more than the number of zero-emission electricity credits equal to the number of megawatt-hours determined under paragraph (2)(C). For the calendar year identified under paragraph (3), if the Secretary makes one or more determinations of inadequate availability of technology under this subsection, the Secretary shall award under section 205(b) an amount of money equal to the sum of— the total amount paid by retail electricity suppliers as alternative compliance payments; and the total amount of the alternative compliance payments that would have been made by the petitioner or petitioners but for the determination of inadequate availability of technology made under paragraph (2). A qualified zero-emission electricity taxpayer that receives a zero-emission electricity acceleration investment credit for a calendar year under section 45U of the Internal Revenue Code of 1986, as added by section 301 of this Act, shall not be subject to the requirements to submit zero-emission electricity credits under this section for such calendar year and every calendar year thereafter. An eligible electricity provider that is awarded a grant under section 302 of this Act for a calendar year shall not be subject to the requirements to submit zero-emission electricity credits under this section for such calendar year and every calendar year thereafter, as long as the condition described under section 302(a)(1) continues to be met.