Sec. 402. Federal clean electricity standard
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Title VI of the Public Utility Regulatory Policies Act of 1978 ( 16 U.S.C. 2601 et seq. ) is further amended by adding after section 610 (as added by this Act) the following: Not later than 180 days after the program trigger date and in accordance with this section, the Secretary shall establish a program— to reduce the amount of carbon dioxide that is emitted by electricity generators; and under which clean electricity credits are issued, tracked, and surrendered. For each calendar year, beginning on the program effective date, the Secretary shall issue clean electricity credits to each qualifying electricity generator in the amount determined under paragraph (2).
Except as provided in paragraph (3), the number of clean electricity credits issued under paragraph
(1)shall be the number that is equal to— the number of megawatt-hours of electricity sold by the qualifying electricity generator; multiplied by the number that is equal to— 1.0; less the number that is equal to— the annual carbon intensity of the qualifying electricity generator; divided by 0.82. If a dynamic crediting methodology is approved under section 612(c), the Secretary shall use such methodology to determine the number of clean electricity credits to issue under this subsection. For each compliance period each retail electricity supplier shall, except as provided in paragraph
(2)and by not later than 6 months after the date on which the compliance period ends, surrender the number of clean electricity credits determined under paragraph (3). For each clean electricity credit required to be surrendered under paragraph
(1)that is not so surrendered, a retail electricity supplier shall pay an amount that is equal to the alternative compliance price determined under paragraph (7). As determined by the Secretary, the number of clean electricity credits required to be surrendered under paragraph
(1)by each retail electricity supplier shall be equal to— the percentage determined under subparagraph (B); multiplied by the number of megawatt-hours of electricity sold at retail by the retail electricity supplier during the applicable compliance period. The Secretary shall determine the percentage to be applied in subparagraph (A)(i) for each compliance period that will result in an 80 percent reduction in the amount of carbon dioxide emitted by electricity generators, relative to the amount of such emissions on the date of enactment of this section, by 2050. The Secretary shall determine the percentage for each compliance period under clause
(i)with the goal of achieving linear reductions in the amount of carbon dioxide emitted by electricity generators in each successive compliance period. The percentage determined under subparagraph
(B)for the first compliance period shall be the greater of— the percentage obtained by dividing— the total number of clean electricity credits that would be issued under subsection (b)(2) for the year in which this section is enacted; by the total number of megawatt-hours of electricity sold by retail electricity suppliers in the year in which this section is enacted; and the percentage obtained by dividing— the total number of clean electricity credits projected to be issued under paragraph (4)(B) for 2030; by the total number of megawatt-hours projected to be sold by retail electricity suppliers in 2030. Not later than the date that is 2 years after the date of enactment of this section, the Secretary shall publish a projection of the percentage to be used for purposes of paragraph (3)(A)(i) for the first compliance period, which such projection shall be made based on the number of megawatt-hours of electricity sold by qualifying electricity generators during the period of five years that precedes the date of the projection and the associated carbon dioxide emissions. By not later than 2026, the Secretary shall publish a projection of the number of clean electricity credits that would be issued to qualifying electricity generators in 2030. Each clean electricity credit issued under subsection
(b)may only be surrendered once for purposes of complying with the requirements of paragraph (1). A clean electricity credit issued under subsection
(b)may be surrendered for the compliance period in which the clean electricity credit is issued or in any subsequent compliance period. The alternative compliance price for the first compliance period shall be $30 per applicable clean electricity credit. Beginning after the first compliance period, the Secretary shall increase the amount of the alternative compliance price from the amount for the prior compliance period by 5 percent. The Secretary may adjust the alternative compliance price to account for inflation, as the Secretary may determine necessary. Subject to paragraph (2), a retail electricity supplier that fails to meet the requirements of paragraph
(1)or
(2)of subsection
(c)shall be subject to a civil penalty in an amount equal to— the number of megawatt-hours of electricity sold by the retail electricity supplier for which such retail electricity supplier fails to surrender a clean electricity credit or make an alternative compliance payment as required under subsection (c); multiplied by 200 percent of the value of the applicable alternative compliance price. The Secretary shall assess a civil penalty under this subsection in accordance with the procedures for assessing a penalty under section 333(d) of the Energy Policy and Conservation Act ( 42 U.S.C. 6303(d) ). Nothing in this section affects the authority of a State, or a political subdivision of a State, to adopt or enforce any law relating to— clean electricity or renewable energy; carbon dioxide emissions; or the regulation of a retail electricity supplier. Not later than 1 year after the date of enactment of this section, the Secretary shall issue regulations to implement this section. In this section: The term carbon intensity means, as determined by the Secretary in consultation with the Administrator of the Environmental Protection Agency and with respect to a qualifying electricity generator, the amount (in metric tons per megawatt-hour) obtained by dividing— the annual carbon dioxide emissions of the qualifying electricity generator, excluding any carbon dioxide that is captured and utilized or stored in a manner that prevents emission to the atmosphere; by the annual quantity of electricity generated by the qualifying electricity generator. The term clean electricity credit means a credit issued under subsection (b). The term clean electricity standard means the requirements of section 611. The term compliance period means the 3-year period that begins on the program effective date and each 3-year period thereafter until 2050. The term qualifying electricity generator means any electricity generator that has an annual carbon intensity of less than 0.82 metric tons per megawatt-hour. The term retail electricity supplier means an entity in the United States that sold not fewer than 20 megawatt-hours of electricity to electricity consumers for purposes other than resale during the preceding calendar year. The term program trigger date means January 1 of the first calendar year beginning after the date on which the Secretary certifies that cost-effective market penetration of eligible technologies has occurred under section 610(c). The term program effective date means the earlier of— the date that is 2 years after the program trigger date; and January 1 of the first calendar year that begins after the date that is 10 years after the date of enactment of this section. Not later than 2 years after the date of enactment of this section, the Secretary, in consultation with the Administrator of the Environmental Protection Agency, shall identify a dynamic crediting methodology for calculating the amount of carbon dioxide emissions that are avoided or displaced on an hourly basis by increased electricity generation from qualifying electricity generators. Any dynamic crediting methodology identified under paragraph
(1)may account for differences between— regions in which there is a Regional Transmission Organization or an Independent System Operator; and regions in which there are no such entities. The Secretary shall provide any dynamic crediting methodology identified under subsection
(a)to the Commission for review. Not later than 120 days after the Secretary provides a dynamic crediting methodology to the Commission under paragraph (1), the Commission shall hold a technical conference in partnership with State regulatory authorities to evaluate such methodology. Not later than 180 days after the Commission holds a technical conference under paragraph (2), and after providing an opportunity for public comment, the Commission shall provide to the Secretary a report on the technical conference that includes Commission recommendations concerning the use of the dynamic crediting methodology. Not later than 180 days following receipt of the report provided under subsection (b)(3), the Secretary, in consultation with the Administrator of the Environmental Protection Agency, shall approve use of the dynamic crediting methodology that is the subject of such report if the Secretary determines that such use would— significantly enhance confidence that the program established under 611(a)(1) will help achieve an 80 percent reduction in the amount of carbon dioxide emitted by electricity generators, relative to the amount of such emissions on the date of enactment of this section, by 2050; or significantly reduce the costs of achieving such reduction. If the Secretary approves a dynamic crediting methodology under subsection (c), the Secretary shall use such dynamic crediting methodology to determine the number of clean electricity credits to be issued to a qualifying electricity generator to account for the amount of carbon dioxide emissions that are avoided or displaced on an hourly basis by increased electricity generation from such qualifying electricity generator. Except as provided in subparagraph (B), the Secretary shall use a dynamic crediting methodology approved under subsection
(c)beginning in the later of— the first full calendar year beginning after the date on which such approval occurs; and the first calendar year of the first compliance period. The Secretary may delay use of an approved dynamic crediting methodology by 1 year if the Secretary finds that additional time is needed for the Secretary or the Commission to take actions necessary to carry out subsection (e). The Secretary may, by rule, require that Regional Transmission Organizations, Independent System Operators, other balancing authorities, and other appropriate entities provide the Secretary with the information necessary for the Secretary to use a dynamic crediting methodology approved under subsection (c). At the request of the Secretary, or upon its own initiative, the Commission shall consider whether changes to any tariffs on file pursuant to section 205 of the Federal Power Act ( 16 U.S.C. 824d ) are necessary to implement the requirements of any rule issued by the Secretary under paragraph (1). The terms Regional Transmission Organization and Independent System Operator have the meanings given such terms in section 3 of the Federal Power Act ( 16 U.S.C. 796 ). In this section, the terms clean electricity credit , compliance period , and qualifying electricity generator have the meanings given such terms in section 611. . Section 1(b) of the Public Utility Regulatory Policies Act of 1978 is further amended by adding after the item related to section 610 (as added by this Act) the following: Sec. 611. Clean electricity standard. Sec. 612. Identification, review, and approval of dynamic crediting methodologies. . Section 111(a)(4) of the Clean Air Act ( 42 U.S.C. 7411(a)(4) ) is amended— by striking The term and inserting
(A)The term ; and by adding at the end the following: Until the end of the first compliance period of the clean electricity standard (as such terms are defined in section 611(h) of Public Utility Regulatory Policies Act of 1978), the term modification , notwithstanding subparagraph (A), does not include a physical or operational change at an electricity generating unit that is designed to reduce the amount of carbon dioxide emitted per megawatt hour at electricity utility generating units, provided that such change— does not cause the violation of a national ambient air quality standard in an air quality control region in which an environmental justice community (as defined by the Administrator) exists; and does not result in— an increase in the maximum hourly emissions rate of any air pollutant subject to a national ambient air quality standard under section 109 that is achievable by such unit; and both a significant emissions increase and a significant net emissions increase in annual actual emissions of such pollutant from such unit. .
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Sec. 402
Federal clean electricity standard
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