Section 5.901 Purpose
and Applicability
This rule establishes the standard
requirements for the decommissioning of electric generation, electric
transmission, and natural gas facilities pursuant to
30
V.S.A. §
248(a)(5). This
rule applies to all electric generation, electric transmission, and
natural gas facilities that are or become subject to the jurisdiction
of the Vermont Public Utility Commission pursuant to
30
V.S.A. §
248. This includes
net-metering facilities permitted under the procedures authorized by
30 V.S.A. §
8010. This rule shall apply to all
facilities for which a petition or application for a certificate of
public good under
30
V.S.A. §
248 is submitted
after the effective date of this rule.
Section 5.902 Definitions
(A) Commission: The Vermont Public
Utility Commission.
(B)
CPG: certificate of public good.
(C) CPG holder: a person or company
who holds a CPG pursuant to
30
V.S.A. §
248 to construct and
operate an electric generation, electric transmission, or natural gas
facility.
(D) Facility:
an electric generation, electric transmission, or natural gas
facility for which a petition for a CPG pursuant to
30
V.S.A. §
248 is submitted to
the Commission after the effective date of this rule.
(E) Plant capacity: The term plant
capacity shall have the same meaning as defined in
30 V.S.A. §
8002.
(F) Utility: for purposes of this
rule, a person or entity engaged in the distribution of electricity
or natural gas for retail sale, or the Vermont Electric Power
Company, Inc. and Vermont Transco, LLC and any successor
thereof.
Section
5.903 Requirements for Utility-Owned
Facilities
Facilities owned by utilities shall be removed once
they are no longer in service. The Commission may require a utility
to implement some or all of the requirements applicable to
non-utility facilities set forth in Rule 5.904, below, or alternative
means to ensure the removal of facilities that are no longer in
service. The Commission will incorporate such requirements as
conditions of CPGs issued pursuant to Section
248,
as applicable.
Section
5.904 Requirements for Non-Utility-Owned Facilities
(A) Requirements for
non-utility-owned generation facilities with a plant capacity equal
to or greater than 150 kW and less than or equal to 500 kW.
Facilities in this category shall be removed once they are no longer
in service, and the site shall be restored to its condition prior to
installation of the facility to the greatest extent practicable. The
Commission will incorporate this requirement as a condition of CPGs
issued pursuant to Section
248,
as applicable.
(B)
Requirements for facilities with greater than 500 kW plant capacity
and non-utility-owned electric and gas transmission facilities.
Facilities in this category shall be removed once they are no longer
in service, and the site shall be restored to its condition prior to
installation of the facility to the greatest extent practicable. In
addition, facilities in this category shall meet the requirements
described below. The Commission will incorporate these requirements
as conditions of CPGs issued pursuant to Section
248,
as applicable.
1. Requirement to
submit decommissioning cost estimate. All petitions to construct or
operate a facility subject to this subsection shall include a
facility-specific decommissioning cost estimate in present-day
dollars that identifies the costs associated with decommissioning
activities.
a) Decommissioning cost
estimates shall include all costs associated with the dismantlement
and safe disposal of facility components and site restoration
activities, including the following elements:
i. All labor, equipment,
transportation, and disposal costs associated with the removal of all
facility components from the facility site;
ii. All costs associated with full
restoration of the facility site, including removal of non-native
soils, fences, and constructed access roads;
iii. All costs associated with
reclamation of any primary agricultural soils at the facility site to
ensure each area of direct impact shall be materially the same as it
was before construction;
iv. All costs associated with
obtaining and complying with any federal, state, or local permits
that may be required as a result of decommissioning
activities;
v. All
decommissioning activity management, site supervision, site safety
costs; and
vi. Any other
costs associated with the decommissioning and restoration of the
facility site.
b) The salvage value of facility
components shall not be subtracted from or otherwise offset costs
included in the decommissioning cost estimate.
c) Decommissioning cost estimates
shall identify the name, job title, contact information, and
qualifications of the individual who prepared the estimate.
2 Irrevocable
standby letter of credit. All requests to construct or operate a
non-utility electric generation, electric transmission, or natural
gas facility shall include a draft irrevocable standby letter of
credit in an amount sufficient to fund the estimated decommissioning
and site restoration costs developed pursuant to Paragraph (B)(1),
above. Prior to commencing construction of the facility, a CPG holder
shall file and receive Commission approval of an executed letter of
credit. The letter of credit shall:
(1) name the Commission as the sole
beneficiary of the letter of credit;
(2) be issued by an A-rated
financial institution;
(3) include an automatic extension
provision or "evergreen clause"; and
(4) be bankruptcy remote.
(3) Alternative form of
financial security. The Commission may, in its discretion, approve
alternative forms of financial security from that required in
subparagraph (2), above, if it finds that such alternative forms will
provide an assurance of the availability of financial resources for
decommissioning that equals or exceeds that provided by the form
required by that subparagraph.
(4) Reporting. Every three years, a
non-utility CPG holder shall file a report with the Commission, the
Vermont Department of Public Service, and each party to the
proceeding in which the facility's CPG was granted, describing any
adjustments and changes to the decommissioning fund in the previous
three-year period. This report shall be filed no later than February
28 of the third year following the issuance of the CPG and every
subsequent third year.
(5) Fund inflation adjustment. The
value of a non-utility facility's decommissioning fund shall be
adjusted for inflation every three years based upon the net positive
change in the annual average of the U.S. Bureau of Labor Statistics'
Northeast Urban Consumer Price Index for the preceding three-year
period. The decommissioning fund amount shall not be reduced in
periods when the Northeast Urban Consumer Price Index reports a net
negative change for the preceding three-year period.
(6) Letter of credit adjustment.
The facility's standby letter of credit shall be adjusted every three
years to reflect changes to the decommissioning fund as provided in
subparagraph (5), above. Revisions shall be made no later than
February 28 in conjunction with the report required pursuant to
subparagraph (4), above. Nothing herein shall preclude the Commission
from requiring more frequent adjustments due to facility or site
conditions.
(7) Access to
decommissioning fund. The Commission shall have the right to draw
upon a non-utility facility's irrevocable standby letter of credit to
pay for decommissioning in the event that the CPG holder has not
commenced decommissioning activities within 90 days of a Commission
order directing decommissioning.
(8) Release of excess funds upon
completion of decommissioning activities. Upon completion of all
decommissioning and site restoration activities, a CPG holder shall
request a determination from the Commission that the CPG holder's
decommissioning obligations have been satisfied. Upon the
Commission's determination that the decommissioning obligations have
been satisfied, the Commission will terminate the facility's letter
of credit.
Section 5.905 Mitigation
Plantings
Nothing in this rule shall require the removal of
plantings installed as part of a Commission-approved aesthetic
mitigation plan.
Section
5.906 Exemption for Roof-mounted Facilities and Parking
Lot Canopies
The following shall be exempt from the requirements
of this rule: electric generation facilities located (1) on a new or
existing structure whose primary use is not the generation of
electricity or providing support for the placement of equipment that
generates electricity or (2) on a parking lot canopy over a paved
parking lot, provided that the location remains in use as a parking
lot.
Section
5.907 Waiver of Rule Requirements
The Commission
may, for good cause, grant exceptions in particular cases to any
provision of this rule.
Section 5.908 Repeal of Prior
Requirements
Paragraph 5.402(C)(2) of Commission Rule 5.400
related to decommissioning is hereby repealed, except with respect to
any proceeding pending on the effective date of this
rule.
