Section 75.65. Alternative compliance payments

(a) Within 15 days of receipt of the report identified in § 75.64(c)(4) (relating to alternative energy credit program administrator), the Commission will provide written notice to each EDC and EGS that was noncompliant with § 75.61 (relating to EDC and EGS obligations) of their alternative compliance payment for that reporting period.

(b) Each EDC and EGS shall be assessed an alternative compliance payment according to the following formula:

(1) For noncompliance with the solar photovoltaic requirements identified in § 75.61, an EDC and EGS shall make an alternative compliance payment equal to the following:

(i) The average market value for solar photovoltaic alternative energy credits sold during the reporting period in the RTO control area where the noncompliance occurred.

(ii) Add to value in subparagraph (i), the levelized up-front rebates received by sellers of solar renewable energy credits, (calculated as follows: total amount of rebates paid within the previous 20 years, divided by the total kilowatt capacity for which rebates were given in the previous 20 years, divided by 20 (the useful life of a solar photovoltaic system), multiplied by the percentage of alternative energy used during the reporting period originating from jurisdictions where rebates were given.

(iii) Multiply the value in subparagraph (ii) by 200%.

(2) For noncompliance with all other requirements identified in § 75.61, an EDC and EGS shall make an alternative compliance payment equal to $45 times the number of additional alternative energy credits necessary for compliance in that reporting period.

(3) The costs of alternative compliance payments made under this section may not be recoverable from ratepayers.

(c) EDCs and EGSs shall advise the Commission in writing within 15 days of the issuance of this notice of their acceptance of the alternative compliance payment determination or, if they wish to contest the determination, file a petition to modify the level of the alternative compliance payment. The petition must include documentation supporting the proposed modification. The Commission will refer the petition to the Office of Administrative Law Judge for further proceedings as may be necessary. Failure of an EDC or EGS to respond to the Commission within 15 days of the issuance of this notice shall be deemed an acceptance of the alternative compliance payment determination.

(d) EDCs and EGSs shall send their alternative compliance payments to a special fund designated by the Commission within 30 days of acceptance of their payment determination, or the conclusion of proceedings before the Commission regarding the modification of the level of payment.

(e) Alternative compliance payments shall be made available to the sustainable energy funds established through the Commission’s orders entered under 66 Pa.C.S. § 2806(f) (relating to Commission review of restructuring filings), under procedures and standards proposed by the Pennsylvania Sustainable Energy Board and approved by the Commission at Docket M-00031715. See 33 Pa.B. 4263 (August 23, 2003).

(f) Alternative compliance payments made available to the sustainable energy funds shall be utilized solely for projects that increase the amount of electric energy generated from alternative energy resources for purposes of compliance with § 75.61.

(g) The Commission may utilize up to 5% of alternative compliance payments made by EDCs and EGSs for administrative expenses directly associated with the implementation of this chapter, including the costs of the program administrator.