42 U.S.C. § 6344 — Additional incentives for recovery, use, and prevention of industrial waste energy

(a) Consideration of the standard. (1) Within 180 days after receiving a request from a project^* sponsor, owner^*, or operator, the State^* regulatory authority for each electric utility over which it has rate-setting authority, or a nonregulated electric utility, must give public notice and hold a hearing about the standard in subsection (b). After the hearing, it must decide whether adopting the standard is appropriate to carry out this part. (2) For that decision and any court review, this section adds to the otherwise applicable State law. (3) This part does not prevent the authority or utility from deciding under otherwise applicable State law that adopting the standard is not appropriate. (b) Standard for selling excess power. The standard must make an owner or operator of a waste-energy recovery project listed on the Registry^* and producing net excess power^* eligible for at least one option in subsection (c), subject to subsection (d)'s rates and limits. (c) Options. (1) The utility must buy the project's net excess power while the project operates, under a contract for that purchase. (2) The utility must transmit the power for the owner or operator to as many as three separate places on its system, where the owner or operator may sell directly to third parties. (3) The State and utility must allow the project owner or operator to build and operate private electric wires to as many as three purchasers within three miles of the project. They must waive or change laws that would otherwise prohibit the wires, allow the wires to use or cross public rights-of-way, and give them the same safety, zoning, land-use, and other legal treatment^* as the utility's wires, without regulating the project as a public utility. (A) The State may not give anyone eminent-domain power to take or cross private property for the wires. (B) The wires must be physically separate from and not connected to the utility system, except on the customer side of the utility's revenue meter and only in a way that prevents electricity from entering the utility system or disrupting it. (4) The utility and project owner or operator may agree on another arrangement and related payments or rates if it is mutually satisfactory and follows State law. (d) Rate conditions and criteria. (1) Definitions. (A) “Per unit distribution costs” means, in kilowatt-hours, the utility's depreciated book-value distribution-system costs divided by the amount of utility electricity sold or transmitted at the distribution level during the previous year. (B) “Per unit distribution margin” means the following. For a State-regulated utility, it is the per-unit gross pretax profit obtained by multiplying the State-approved rate of return for the utility's distribution-system assets by the per-unit distribution costs. For a nonregulated utility, it is a per-unit contribution to net revenues obtained by multiplying the per-unit distribution costs by a percentage that is the greater of the percentage calculated by dividing the prior year's net-revenue payments or contributions to owners or subscribers by the utility's prior-year gross revenues, or 10 percent. (C) “Per unit transmission costs” means the total cost of transmission services the utility buys or provides, calculated per kilowatt-hour as included in the utility's retail rate. (2) The purchase and transport options in subsection (c)(1) and (2) must use rates reflecting these components when paragraph (3) applies. (3) Applicable rates. (A) For a sale under subsection (c)(1), the utility must pay per kilowatt-hour the full, undiscounted retail rate the facility pays the utility for power, minus per-unit distribution costs applicable to the type of purchasing utility. If the power is available at a voltage that must be transformed to or from a voltage above 25 kilovolts before the utility can resell it, subtract per-unit transmission costs too. (B) For utility transport under subsection (c)(2), the owner or operator must pay a transport rate equal to the applicable per-unit distribution costs plus per-unit distribution margin. If transformation to or from a voltage above 25 kilovolts is needed to transport the power to the named third-party purchasers, add per-unit transmission costs. In a State with a competitive retail electricity market, use the applicable rate for similar transportation instead of a rate calculated under this paragraph. (4) Limitations. (A) A sale or transport rate must change over time as the utility's underlying costs or rates change, and must use the same time-sensitive features and billing periods as the utility's retail sale or transport rates. (B) A utility need not buy or transport more power than the capacity of its wires, meter, or other equipment serving the site, unless the project owner or operator agrees to pay necessary and reasonable upgrade costs. (e) Procedures. (1) The consideration must follow public notice and a hearing. The decision must be written, include findings, rely on the hearing evidence, and be public. (2) The Administrator^* may intervene as a matter of right to calculate likely energy and emissions savings from choosing one or more options, calculate costs and benefits for ratepayers and the utility, and advocate for the waste-energy recovery opportunity. (3) Except for paragraphs (1) and (2), the regulator or nonregulated utility sets the procedures. If several projects seek consideration at the same time from the same utility, one proceeding may cover them all only if each project's circumstances and merits receive full attention and a separate judgment is made for each. (f) Implementation. (1) Consistent with otherwise applicable State law, the regulator or nonregulated utility may implement the standard or decline to implement it. (2) If it declines, it must give its reasons in writing, and the reasons must be public. The Administrator must include in an annual report to Congress the lost waste-heat-recovery opportunities for the project, identify the utility, and state the calculated lost energy and emissions savings. The project sponsor may file a new petition about the project after two years have passed since the decision not to implement the standard.