Rep. Jay Hoffman

Filed: 10/29/2025

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1 AMENDMENT TO SENATE BILL 25

2 AMENDMENT NO. ______. Amend Senate Bill 25, AS AMENDED,

3 with reference to page and line numbers of House Amendment No.

4 4, by replacing line 1 on page 601 through line 10 on page 632

5 with the following:

6 "(220 ILCS 5/8-104)

7 Sec. 8-104. Natural gas energy efficiency programs.

8 (a) It is the policy of the State that natural gas

9 utilities and the Department of Commerce and Economic

10 Opportunity are required to use cost-effective energy

11 efficiency to reduce direct and indirect costs to consumers.

12 It serves the public interest to allow natural gas utilities

13 to recover costs for reasonably and prudently incurred

14 expenses for cost-effective energy efficiency measures.

15 (b) For purposes of this Section, "energy efficiency"

16 means measures that reduce the amount of energy required to

17 achieve a given end use. "Energy efficiency" also includes

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1 measures that reduce the total Btus of electricity and natural

2 gas needed to meet the end use or uses. "Cost-effective" means

3 that the measures satisfy the total resource cost test which,

4 for purposes of this Section, means a standard that is met if,

5 for an investment in energy efficiency, the benefit-cost ratio

6 is greater than one. The benefit-cost ratio is the ratio of the

7 net present value of the total benefits of the measures to the

8 net present value of the total costs as calculated over the

9 lifetime of the measures. The total resource cost test

10 compares the sum of avoided natural gas utility costs,

11 representing the benefits that accrue to the system and the

12 participant in the delivery of those efficiency measures, as

13 well as other quantifiable societal benefits, including

14 avoided electric utility costs, to the sum of all incremental

15 costs of end use measures (including both utility and

16 participant contributions), plus costs to administer, deliver,

17 and evaluate each demand-side measure, to quantify the net

18 savings obtained by substituting demand-side measures for

19 supply resources. In calculating avoided costs, reasonable

20 estimates shall be included for financial costs likely to be

21 imposed by future regulation of emissions of greenhouse gases.

22 The low-income programs described in item (4) of subsection

23 (f) of this Section shall not be required to meet the total

24 resource cost test.

25 (c) Natural gas utilities shall implement cost-effective

26 energy efficiency measures to meet at least the following

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1 natural gas savings requirements, which shall be based upon

2 the total amount of gas delivered to retail customers, other

3 than the customers described in subsection (m) of this

4 Section, during calendar year 2009 multiplied by the

5 applicable percentage. Natural gas utilities may comply with

6 this Section by meeting the annual incremental savings goal in

7 the applicable year or by showing that total cumulative annual

8 savings within a multi-year planning period associated with

9 measures implemented after May 31, 2011 were equal to the sum

10 of each annual incremental savings requirement from the first

11 day of the multi-year planning period through the last day of

12 the multi-year planning period:

13 (1) 0.2% by May 31, 2012;

14 (2) an additional 0.4% by May 31, 2013, increasing

15 total savings to .6%;

16 (3) an additional 0.6% by May 31, 2014, increasing

17 total savings to 1.2%;

18 (4) an additional 0.8% by May 31, 2015, increasing

19 total savings to 2.0%;

20 (5) an additional 1% by May 31, 2016, increasing total

21 savings to 3.0%;

22 (6) an additional 1.2% by May 31, 2017, increasing

23 total savings to 4.2%;

24 (7) an additional 1.4% in the year commencing January

25 1, 2018;

26 (8) an additional 1.5% in the year commencing January

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1 1, 2019; and

2 (9) an additional 1.5% in each 12-month period

3 thereafter.

4 (d) Notwithstanding the requirements of subsection (c) of

5 this Section, a natural gas utility shall limit the amount of

6 energy efficiency implemented in any multi-year reporting

7 period established by subsection (f) of Section 8-104 of this

8 Act, by an amount necessary to limit the estimated average

9 increase in the amounts paid by retail customers in connection

10 with natural gas service to no more than 2% in the applicable

11 multi-year reporting period. The energy savings requirements

12 in subsection (c) of this Section may be reduced by the

13 Commission for the subject plan, if the utility demonstrates

14 by substantial evidence that it is highly unlikely that the

15 requirements could be achieved without exceeding the

16 applicable spending limits in any multi-year reporting period.

17 No later than September 1, 2013, the Commission shall review

18 the limitation on the amount of energy efficiency measures

19 implemented pursuant to this Section and report to the General

20 Assembly, in the report required by subsection (k) of this

21 Section, its findings as to whether that limitation unduly

22 constrains the procurement of energy efficiency measures.

23 (e) The provisions of this subsection (e) apply to those

24 multi-year plans that commence prior to January 1, 2018. The

25 utility shall utilize 75% of the available funding associated

26 with energy efficiency programs approved by the Commission,

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1 and may outsource various aspects of program development and

2 implementation. The remaining 25% of available funding shall

3 be used by the Department of Commerce and Economic Opportunity

4 to implement energy efficiency measures that achieve no less

5 than 20% of the requirements of subsection (c) of this

6 Section. Such measures shall be designed in conjunction with

7 the utility and approved by the Commission. The Department may

8 outsource development and implementation of energy efficiency

9 measures. A minimum of 10% of the entire portfolio of

10 cost-effective energy efficiency measures shall be procured

11 from local government, municipal corporations, school

12 districts, public institutions of higher education, and

13 community college districts. Five percent of the entire

14 portfolio of cost-effective energy efficiency measures may be

15 granted to local government and municipal corporations for

16 market transformation initiatives. The Department shall

17 coordinate the implementation of these measures and shall

18 integrate delivery of natural gas efficiency programs with

19 electric efficiency programs delivered pursuant to Section

20 8-103 of this Act, unless the Department can show that

21 integration is not feasible.

22 The apportionment of the dollars to cover the costs to

23 implement the Department's share of the portfolio of energy

24 efficiency measures shall be made to the Department once the

25 Department has executed rebate agreements, grants, or

26 contracts for energy efficiency measures and provided

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1 supporting documentation for those rebate agreements, grants,

2 and contracts to the utility. The Department is authorized to

3 adopt any rules necessary and prescribe procedures in order to

4 ensure compliance by applicants in carrying out the purposes

5 of rebate agreements for energy efficiency measures

6 implemented by the Department made under this Section.

7 The details of the measures implemented by the Department

8 shall be submitted by the Department to the Commission in

9 connection with the utility's filing regarding the energy

10 efficiency measures that the utility implements.

11 The portfolio of measures, administered by both the

12 utilities and the Department, shall, in combination, be

13 designed to achieve the annual energy savings requirements set

14 forth in subsection (c) of this Section, as modified by

15 subsection (d) of this Section.

16 The utility and the Department shall agree upon a

17 reasonable portfolio of measures and determine the measurable

18 corresponding percentage of the savings goals associated with

19 measures implemented by the Department.

20 No utility shall be assessed a penalty under subsection

21 (f) of this Section for failure to make a timely filing if that

22 failure is the result of a lack of agreement with the

23 Department with respect to the allocation of responsibilities

24 or related costs or target assignments. In that case, the

25 Department and the utility shall file their respective plans

26 with the Commission and the Commission shall determine an

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1 appropriate division of measures and programs that meets the

2 requirements of this Section.

3 (e-5) The provisions of this subsection (e-5) shall be

4 applicable to those multi-year plans that commence after

5 December 31, 2017. Natural gas utilities shall be responsible

6 for overseeing the design, development, and filing of their

7 efficiency plans with the Commission and may outsource

8 development and implementation of energy efficiency measures.

9 A minimum of 10% of the entire portfolio of cost-effective

10 energy efficiency measures shall be procured from local

11 government, municipal corporations, school districts, public

12 institutions of higher education, and community college

13 districts; unless a utility files a plan or amended plan under

14 the provisions of subsection (e-20), in which case the minimum

15 spend for measures from such public customers shall be equal

16 to at least 30% of non-residential spending. Five percent of

17 the entire portfolio of cost-effective energy efficiency

18 measures may be granted to local government and municipal

19 corporations for market transformation initiatives.

20 Through calendar year 2026, the ~~The~~ utilities shall also

21 present a portfolio of energy efficiency measures

22 proportionate to the share of total annual utility revenues in

23 Illinois from households at or below 150% of the poverty

24 level. Such programs shall be targeted to households with

25 incomes at or below 80% of area median income.

26 (e-7) Beginning January 1, 2027, the following

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1 requirements shall be in effect for efficiency programs

2 targeted to low-income households. For the purposes of this

3 Section, "low-income households" means households with incomes

4 at or below 80% of the area median income. Utilities shall

5 leverage existing State and federal low-income weatherization

6 programs and delivery capacity to the extent practicable.

7 Utilities shall also prioritize contracting with

8 organizations, government agencies, and businesses with a

9 track record of delivering weatherization services in

10 low-income communities in this State to deliver any low-income

11 programs that are not integrated with State and federal

12 low-income weatherization programs.

13 (e-8) Beginning January 1, 2027, the following

14 requirements shall be in effect for efficiency programs

15 targeted to low-income households, except for single-fuel gas

16 utilities with less than 1,000,000 customers:

17 (1) The portion of the entire budget for efficiency

18 programs that is spent on efficiency programs for

19 low-income households shall be no less than the greater

20 of: (A) 25% or (B) five percentage points more than the

21 proportion of total annual gas sales to non-opt-out retail

22 customers that are consumed by low-income households.

23 (2) The portion of spending on efficiency measures

24 that are targeted to low-income households that is

25 delivered through whole building weatherization programs

26 that comprehensively address building envelope efficiency

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1 upgrade opportunities as well as other efficiency measures

2 shall be at least 80%.

3 (3) Utilities shall invest in health and safety

4 measures that are appropriate and necessary for

5 comprehensively weatherizing the single-family and

6 multi-family buildings of low-income households, with up

7 to 15% of income-qualified program spending made available

8 for such purposes.

9 (e-10) A utility providing approved energy efficiency

10 measures in this State shall be permitted to recover costs of

11 those measures through an automatic adjustment clause tariff

12 filed with and approved by the Commission. The tariff shall be

13 established outside the context of a general rate case and

14 shall be applicable to the utility's customers other than the

15 customers described in subsection (m) of this Section. Each

16 year the Commission shall initiate a review to reconcile any

17 amounts collected with the actual costs and to determine the

18 required adjustment to the annual tariff factor to match

19 annual expenditures.

20 (e-15) For those multi-year plans that commence prior to

21 January 1, 2018, each utility shall include, in its recovery

22 of costs, the costs estimated for both the utility's and the

23 Department's implementation of energy efficiency measures.

24 Costs collected by the utility for measures implemented by the

25 Department shall be submitted to the Department pursuant to

26 Section 605-323 of the Civil Administrative Code of Illinois,

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1 shall be deposited into the Energy Efficiency Portfolio

2 Standards Fund, and shall be used by the Department solely for

3 the purpose of implementing these measures. A utility shall

4 not be required to advance any moneys to the Department but

5 only to forward such funds as it has collected. The Department

6 shall report to the Commission on an annual basis regarding

7 the costs actually incurred by the Department in the

8 implementation of the measures. Any changes to the costs of

9 energy efficiency measures as a result of plan modifications

10 shall be appropriately reflected in amounts recovered by the

11 utility and turned over to the Department.

12 (e-20) The provisions of this Section shall be applicable

13 to multi-year plans that commence after the effective date of

14 this amendatory Act of the 104th General Assembly and are

15 submitted by single fuel service utilities on or before the

16 effective date of this amendatory Act of the 104th General

17 Assembly. A natural gas utility may propose, as part of its

18 submission of a multi-year plan, to increase the amount of

19 energy efficiency implemented in any multi-year planning

20 period above the level that can be achieved under the spending

21 cap set forth in subsection (d) of this Section. The first plan

22 to increase energy efficiency may be submitted as an amendment

23 to the utility's plan for calendar years 2027 through 2029,

24 but any amended plans must be filed with the Commission by

25 March 1, 2026 or the effective date of this amendatory Act of

26 the 104th General Assembly, whichever is later. In addition to

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1 the policy goals established in subsection (f), the Commission

2 shall consider, in determining the appropriateness of a

3 proposal, whether the multi-year plan at a minimum:

4 (1) identifies a cost-effective portfolio of measures

5 and specifies the natural gas savings that are reasonably

6 likely to be achieved by the utility;

7 (2) demonstrates that the plan or modified plan, at a

8 minimum, will result in a portfolio of energy efficiency

9 measures that will provide more natural gas savings than

10 would have been achieved in a plan subject to subsection

11 (c);

12 (3) demonstrates that the plan reflects efforts to

13 coordinate delivery of electric utility efficiency

14 programs where such coordination can reduce costs,

15 increase effectiveness of outreach to customers, and

16 increase savings. A gas utility may count electricity

17 savings toward its gas efficiency savings goals subject to

18 the following limitations:

19 (A) only electricity savings produced as a result

20 of the installation of a gas efficiency measure, such

21 as reductions in electricity consumption by gas

22 furnace fans and electric air conditioners that

23 results from the installation of insulation measures

24 that reduce gas used for space heating, may be

25 counted;

26 (B) such electricity savings may only be counted

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1 when they are generated in service territories not

2 served by electric utilities subject to Section

3 8-103B;

4 (C) no more than 5% of the total savings claimed

5 toward a gas utility's savings goal may be from such

6 electricity savings. For the purposes of this Section,

7 a kilowatt-hour of savings is equal to 0.03412 gas

8 therms;

9 (4) demonstrates whether an increase in funding is

10 necessary to meet the proposed increase in the amount of

11 energy efficiency;

12 (5) prioritizes income-qualified measures and

13 weatherization measures; and

14 (6) demonstrates that the multi-year plan strikes a

15 reasonable balance between the goals of the following:

16 (A) increasing cost-effective efficiency savings

17 and related greenhouse gas emission reductions;

18 (B) reducing overall gas system costs, recognizing

19 that efficiency investments reduce usage and, in turn,

20 the potential need for system investments over the

21 long-term;

22 (C) increasing energy affordability, especially

23 for low-income customers;

24 (D) within the residential sector, prioritizing

25 investment in weatherization and other measures that

26 reduce heating loads over gas equipment measures; and

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1 (E) providing a diverse cross-section of

2 opportunities for customers of all rate classes to

3 participate in efficiency programs.

4 For single-fuel gas utilities with less than 1,000,000

5 customers, the following requirements shall be in effect for

6 efficiency programs targeted to low-income households:

7 (1) For gas utilities with greater than 300,000

8 customers, the portion of the entire budget for efficiency

9 programs that is spent on efficiency programs for

10 low-income households shall be no less than the greater of

11 (A) 25% or (B) five percentage points more than the

12 proportion of total annual gas sales to non-opt-out retail

13 customers that are consumed by low-income households. For

14 gas utilities with 300,000 or fewer customers, the portion

15 of the entire budget for efficiency programs that is spent

16 on efficiency programs for low-income households shall be

17 no less than the greater of (A) 15% or (B) five percentage

18 points more than the proportion of total annual gas sales

19 to non-opt-out retail customers that are consumed by

20 low-income households.

21 (2) The portion of spending on efficiency measures

22 targeted to low-income households that shall be delivered

23 through whole building weatherization programs that

24 comprehensively address building envelope efficiency

25 upgrade opportunities as well as other efficiency measures

26 shall be at least 80%.

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1 (3) Utilities shall invest in health and safety

2 measures appropriate and necessary for comprehensively

3 weatherizing the single-family and multi-family buildings

4 of low-income households, with up to 15% of

5 income-qualified program spending made available for such

6 purposes.

7 As part of its order approving the plan or modified plan,

8 the Commission is authorized to:

9 (1) adjust the limitation on the amount of energy

10 efficiency measures implemented pursuant to subsection (d)

11 to the extent necessary to meet the increase in the amount

12 of energy efficiency approved by the Commission pursuant

13 to this subsection (e-20);

14 (2) adjust the public sector spending requirements

15 pursuant to subsection (e-5);

16 (3) adopt an incentive mechanism for the utility to

17 meet or exceed the goals associated with its proposed

18 multi-year plan if the utility meets or exceeds the

19 following minimum requirements:

20 (A) the utility proposes a plan budget over the

21 applicable multi-year period that is equal to or

22 greater than 5% of the amounts paid by non-opt-out

23 retail customers in connection with natural gas

24 service in the applicable multi-year period;

25 (B) for efficiency program years 2027 through

26 2029, the utility achieves average incremental annual

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1 savings of at least 0.7% of total average annual gas

2 sales to non-opt-out retail customers over the years

3 2023 through 2025. For multi-year efficiency program

4 plans beginning after 2029, achieving average

5 incremental annual savings of at least 0.8% of total

6 average annual gas sales to non-opt-out retail

7 customers during the 3-year period ending 2 years

8 prior to the first year of the plan. In all multi-year

9 periods, the minimum incremental annual savings

10 requirement shall be reduced by 0.01 percentage points

11 for every 1 percentage point increase in low-income or

12 moderate-income spending above the minimum levels

13 required by subsection (e-5). In no event shall the

14 minimum incremental annual savings requirement be

15 reduced by more than 0.10 percentage points even if

16 low-income or moderate-income spending is increased by

17 more than 10 percentage points above the minimum

18 levels required by subsection (e-5). The Commission

19 may reduce the magnitude of the minimum savings

20 requirements under this subparagraph (B) if the

21 utility can demonstrate that it is not possible to

22 achieve them with a budget equal to 5% of revenues from

23 eligible customers while meeting other minimum

24 requirements. If a utility attempts to demonstrate

25 that it cannot meet the minimum savings requirements

26 in this paragraph with a budget equal to 5% of revenues

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1 from eligible customers, and the Commission finds that

2 the utility has not made a sufficiently compelling

3 demonstration, the utility may withdraw its plan and

4 file a revised plan;

5 (C) the utility achieves an average savings life

6 of at least 12 years. Average savings lives may be

7 shorter than the average operational lives of measures

8 if the measures do not produce savings in every year in

9 which they operate or if the savings that measures

10 produce decline during their operational lives; and

11 (D) the utility spends at least 67% of all

12 financial incentive dollars on efficiency measures

13 that (1) reduce the space heating loads of buildings

14 through improvements such as to building envelopes,

15 ventilation systems, space heating distribution

16 systems, and space heating system controls; (2) reduce

17 the water heating loads of buildings such as through

18 insulation of hot water pipes, recovery and reuse of

19 heat from waste water and reductions in the amount of

20 hot water required to meet customer needs; or (3)

21 reduce the process heat loads of industrial

22 facilities. Any spending on health and safety measures

23 shall count toward this requirement. No financial

24 incentive spending on furnaces, boilers, water

25 heaters, and other gas-consuming equipment may be

26 counted toward this requirement; and

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1 (4) for modified plans, require a compliance filing

2 from the utility to adjust budgets and natural gas savings

3 targets, if necessary, to reflect the final level of

4 customers opting out under subsection (m-1).

5 For the purposes of this subsection (e-20):

6 "Average savings life" means (i) the savings that will be

7 realized as a result of a utility's efficiency programs over

8 the lives of all efficiency measures divided by (ii) the

9 savings that will be produced in the first year after such

10 measures are installed.

11 "Moderate-income" means income between 80% of area median

12 income and 300% of the federal poverty limit.

13 (f) No later than October 1, 2010, each gas utility shall

14 file an energy efficiency plan with the Commission to meet the

15 energy efficiency standards through May 31, 2014. No later

16 than October 1, 2013, each gas utility shall file an energy

17 efficiency plan with the Commission to meet the energy

18 efficiency standards through May 31, 2017. Beginning in 2017

19 and every 4 years thereafter, each utility shall file an

20 energy efficiency plan with the Commission to meet the energy

21 efficiency standards for the next applicable 4-year period

22 beginning January 1 of the year following the filing. For

23 those multi-year plans commencing on January 1, 2018, each

24 utility shall file its proposed energy efficiency plan no

25 later than 30 days after the effective date of this amendatory

26 Act of the 99th General Assembly or May 1, 2017, whichever is

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1 later. Beginning in 2021 and every 4 years thereafter, each

2 utility shall file its energy efficiency plan no later than

3 March 1. If a utility does not file such a plan on or before

4 the applicable filing deadline for the plan, then it shall

5 face a penalty of $100,000 per day until the plan is filed.

6 Each utility's plan shall set forth the utility's

7 proposals to meet the utility's portion of the energy

8 efficiency standards identified in subsection (c) of this

9 Section, as modified by subsection (d) of this Section, taking

10 into account the unique circumstances of the utility's service

11 territory. For those plans commencing after December 31, 2021,

12 the Commission shall seek public comment on the utility's plan

13 and shall issue an order approving or disapproving each plan

14 within 6 months after its submission. For those plans

15 commencing on January 1, 2018, the Commission shall seek

16 public comment on the utility's plan and shall issue an order

17 approving or disapproving each plan no later than August 31,

18 2017, or 105 days after the effective date of this amendatory

19 Act of the 99th General Assembly, whichever is later. If the

20 Commission disapproves a plan, the Commission shall, within 30

21 days, describe in detail the reasons for the disapproval and

22 describe a path by which the utility may file a revised draft

23 of the plan to address the Commission's concerns

24 satisfactorily. If the utility does not refile with the

25 Commission within 60 days after the disapproval, the utility

26 shall be subject to penalties at a rate of $100,000 per day

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1 until the plan is filed. This process shall continue, and

2 penalties shall accrue, until the utility has successfully

3 filed a portfolio of energy efficiency measures. Penalties

4 shall be deposited into the Energy Efficiency Trust Fund and

5 the cost of any such penalties may not be recovered from

6 ratepayers. In submitting proposed energy efficiency plans and

7 funding levels to meet the savings goals adopted by this Act

8 the utility shall:

9 (1) Demonstrate that its proposed energy efficiency

10 measures will achieve the requirements that are identified

11 in subsection (c) of this Section, as modified by

12 subsection (d) of this Section.

13 (2) Present specific proposals to implement new

14 building and appliance standards that have been placed

15 into effect.

16 (3) Present estimates of the total amount paid for gas

17 service expressed on a per therm basis associated with the

18 proposed portfolio of measures designed to meet the

19 requirements that are identified in subsection (c) of this

20 Section, as modified by subsection (d) of this Section.

21 (4) For those multi-year plans that commence prior to

22 January 1, 2018, coordinate with the Department to present

23 a portfolio of energy efficiency measures proportionate to

24 the share of total annual utility revenues in Illinois

25 from households at or below 150% of the poverty level.

26 Such programs shall be targeted to households with incomes

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1 at or below 80% of area median income.

2 (5) Demonstrate that its overall portfolio of energy

3 efficiency measures, not including low-income programs

4 described in item (4) of this subsection (f) and

5 subsection (e-5) of this Section, are cost-effective using

6 the total resource cost test and represent a diverse cross

7 section of opportunities for customers of all rate classes

8 to participate in the programs.

9 (6) Demonstrate that a gas utility affiliated with an

10 electric utility that is required to comply with Section

11 8-103 or 8-103B of this Act has integrated gas and

12 electric efficiency measures into a single program that

13 reduces program or participant costs and appropriately

14 allocates costs to gas and electric ratepayers. For those

15 multi-year plans that commence prior to January 1, 2018,

16 the Department shall integrate all gas and electric

17 programs it delivers in any such utilities' service

18 territories, unless the Department can show that

19 integration is not feasible or appropriate.

20 (7) Include a proposed cost recovery tariff mechanism

21 to fund the proposed energy efficiency measures and to

22 ensure the recovery of the prudently and reasonably

23 incurred costs of Commission-approved programs.

24 (8) Provide for quarterly status reports tracking

25 implementation of and expenditures for the utility's

26 portfolio of measures and, if applicable, the Department's

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1 portfolio of measures, an annual independent review, and a

2 full independent evaluation of the multi-year results of

3 the performance and the cost-effectiveness of the

4 utility's and, if applicable, Department's portfolios of

5 measures and broader net program impacts and, to the

6 extent practical, for adjustment of the measures on a

7 going forward basis as a result of the evaluations. The

8 resources dedicated to evaluation shall not exceed 3% of

9 portfolio resources in any given multi-year period.

10 (g) No more than 3% of expenditures on energy efficiency

11 measures may be allocated for demonstration of breakthrough

12 equipment and devices.

13 (h) Illinois natural gas utilities that are affiliated by

14 virtue of a common parent company may, at the utilities'

15 request, be considered a single natural gas utility for

16 purposes of complying with this Section.

17 (i) If, after 3 years, a gas utility fails to meet the

18 efficiency standard specified in subsection (c) of this

19 Section as modified by subsection (d), then it shall make a

20 contribution to the Low-Income Home Energy Assistance Program.

21 The total liability for failure to meet the goal shall be

22 assessed as follows:

23 (1) a large gas utility shall pay $600,000;

24 (2) a medium gas utility shall pay $400,000; and

25 (3) a small gas utility shall pay $200,000.

26 For purposes of this Section, (i) a "large gas utility" is

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1 a gas utility that on December 31, 2008, served more than

2 1,500,000 gas customers in Illinois; (ii) a "medium gas

3 utility" is a gas utility that on December 31, 2008, served

4 fewer than 1,500,000, but more than 500,000 gas customers in

5 Illinois; and (iii) a "small gas utility" is a gas utility that

6 on December 31, 2008, served fewer than 500,000 and more than

7 100,000 gas customers in Illinois. The costs of this

8 contribution may not be recovered from ratepayers.

9 If a gas utility fails to meet the efficiency standard

10 specified in subsection (c) of this Section, as modified by

11 subsection (d) of this Section, in any 2 consecutive

12 multi-year planning periods, then the responsibility for

13 implementing the utility's energy efficiency measures shall be

14 transferred to an independent program administrator selected

15 by the Commission. Reasonable and prudent costs incurred by

16 the independent program administrator to meet the efficiency

17 standard specified in subsection (c) of this Section, as

18 modified by subsection (d) of this Section, may be recovered

19 from the customers of the affected gas utilities, other than

20 customers described in subsection (m) of this Section. The

21 utility shall provide the independent program administrator

22 with all information and assistance necessary to perform the

23 program administrator's duties including but not limited to

24 customer, account, and energy usage data, and shall allow the

25 program administrator to include inserts in customer bills.

26 The utility may recover reasonable costs associated with any

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1 such assistance.

2 (j) No utility shall be deemed to have failed to meet the

3 energy efficiency standards to the extent any such failure is

4 due to a failure of the Department.

5 (k) Not later than January 1, 2012, the Commission shall

6 develop and solicit public comment on a plan to foster

7 statewide coordination and consistency between statutorily

8 mandated natural gas and electric energy efficiency programs

9 to reduce program or participant costs or to improve program

10 performance. Not later than September 1, 2013, the Commission

11 shall issue a report to the General Assembly containing its

12 findings and recommendations.

13 (l) This Section does not apply to a gas utility that on

14 January 1, 2009, provided gas service to fewer than 100,000

15 customers in Illinois.

16 (m) Subsections (a) through (k) of this Section do not

17 apply to customers of a natural gas utility that have a North

18 American Industry Classification System code number that is

19 22111 or any such code number beginning with the digits 31, 32,

20 or 33 and (i) annual usage in the aggregate of 4 million therms

21 or more within the service territory of the affected gas

22 utility or with aggregate usage of 8 million therms or more in

23 this State and complying with the provisions of item (l) of

24 this subsection (m); or (ii) using natural gas as feedstock

25 and meeting the usage requirements described in item (i) of

26 this subsection (m), to the extent such annual feedstock usage

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1 is greater than 60% of the customer's total annual usage of

2 natural gas.

3 (1) Customers described in this subsection (m) of this

4 Section shall apply, on a form approved on or before

5 October 1, 2009 by the Department, to the Department to be

6 designated as a self-directing customer ("SDC") or as an

7 exempt customer using natural gas as a feedstock from

8 which other products are made, including, but not limited

9 to, feedstock for a hydrogen plant, on or before the 1st

10 day of February, 2010. Thereafter, application may be made

11 not less than 6 months before the filing date of the gas

12 utility energy efficiency plan described in subsection (f)

13 of this Section; however, a new customer that commences

14 taking service from a natural gas utility after February

15 1, 2010 may apply to become a SDC or exempt customer up to

16 30 days after beginning service. Customers described in

17 this subsection (m) that have not already been approved by

18 the Department may apply to be designated a self-directing

19 customer or exempt customer, on a form approved by the

20 Department, between September 1, 2013 and September 30,

21 2013. Customer applications that are approved by the

22 Department under this amendatory Act of the 98th General

23 Assembly shall be considered to be a self-directing

24 customer or exempt customer, as applicable, for the

25 current 3-year planning period effective December 1, 2013.

26 Such application shall contain the following:

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1 (A) the customer's certification that, at the time

2 of its application, it qualifies to be a SDC or exempt

3 customer described in this subsection (m) of this

4 Section;

5 (B) in the case of a SDC, the customer's

6 certification that it has established or will

7 establish by the beginning of the utility's multi-year

8 planning period commencing subsequent to the

9 application, and will maintain for accounting

10 purposes, an energy efficiency reserve account and

11 that the customer will accrue funds in said account to

12 be held for the purpose of funding, in whole or in

13 part, energy efficiency measures of the customer's

14 choosing, which may include, but are not limited to,

15 projects involving combined heat and power systems

16 that use the same energy source both for the

17 generation of electrical or mechanical power and the

18 production of steam or another form of useful thermal

19 energy or the use of combustible gas produced from

20 biomass, or both;

21 (C) in the case of a SDC, the customer's

22 certification that annual funding levels for the

23 energy efficiency reserve account will be equal to 2%

24 of the customer's cost of natural gas, composed of the

25 customer's commodity cost and the delivery service

26 charges paid to the gas utility, or $150,000,

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1 whichever is less;

2 (D) in the case of a SDC, the customer's

3 certification that the required reserve account

4 balance will be capped at 3 years' worth of accruals

5 and that the customer may, at its option, make further

6 deposits to the account to the extent such deposit

7 would increase the reserve account balance above the

8 designated cap level;

9 (E) in the case of a SDC, the customer's

10 certification that by October 1 of each year,

11 beginning no sooner than October 1, 2012, the customer

12 will report to the Department information, for the

13 12-month period ending May 31 of the same year, on all

14 deposits and reductions, if any, to the reserve

15 account during the reporting year, and to the extent

16 deposits to the reserve account in any year are in an

17 amount less than $150,000, the basis for such reduced

18 deposits; reserve account balances by month; a

19 description of energy efficiency measures undertaken

20 by the customer and paid for in whole or in part with

21 funds from the reserve account; an estimate of the

22 energy saved, or to be saved, by the measure; and that

23 the report shall include a verification by an officer

24 or plant manager of the customer or by a registered

25 professional engineer or certified energy efficiency

26 trade professional that the funds withdrawn from the

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1 reserve account were used for the energy efficiency

2 measures;

3 (F) in the case of an exempt customer, the

4 customer's certification of the level of gas usage as

5 feedstock in the customer's operation in a typical

6 year and that it will provide information establishing

7 this level, upon request of the Department;

8 (G) in the case of either an exempt customer or a

9 SDC, the customer's certification that it has provided

10 the gas utility or utilities serving the customer with

11 a copy of the application as filed with the

12 Department;

13 (H) in the case of either an exempt customer or a

14 SDC, certification of the natural gas utility or

15 utilities serving the customer in Illinois including

16 the natural gas utility accounts that are the subject

17 of the application; and

18 (I) in the case of either an exempt customer or a

19 SDC, a verification signed by a plant manager or an

20 authorized corporate officer attesting to the

21 truthfulness and accuracy of the information contained

22 in the application.

23 (2) The Department shall review the application to

24 determine that it contains the information described in

25 provisions (A) through (I) of item (1) of this subsection

26 (m), as applicable. The review shall be completed within

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1 30 days after the date the application is filed with the

2 Department. Absent a determination by the Department

3 within the 30-day period, the applicant shall be

4 considered to be a SDC or exempt customer, as applicable,

5 for all subsequent multi-year planning periods, as of the

6 date of filing the application described in this

7 subsection (m). If the Department determines that the

8 application does not contain the applicable information

9 described in provisions (A) through (I) of item (1) of

10 this subsection (m), it shall notify the customer, in

11 writing, of its determination that the application does

12 not contain the required information and identify the

13 information that is missing, and the customer shall

14 provide the missing information within 15 working days

15 after the date of receipt of the Department's

16 notification.

17 (3) The Department shall have the right to audit the

18 information provided in the customer's application and

19 annual reports to ensure continued compliance with the

20 requirements of this subsection. Based on the audit, if

21 the Department determines the customer is no longer in

22 compliance with the requirements of items (A) through (I)

23 of item (1) of this subsection (m), as applicable, the

24 Department shall notify the customer in writing of the

25 noncompliance. The customer shall have 30 days to

26 establish its compliance, and failing to do so, may have

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1 its status as a SDC or exempt customer revoked by the

2 Department. The Department shall treat all information

3 provided by any customer seeking SDC status or exemption

4 from the provisions of this Section as strictly

5 confidential.

6 (4) Upon request, or on its own motion, the Commission

7 may open an investigation, no more than once every 3 years

8 and not before October 1, 2014, to evaluate the

9 effectiveness of the self-directing program described in

10 this subsection (m).

11 Customers described in this subsection (m) that applied to

12 the Department on January 3, 2013, were approved by the

13 Department on February 13, 2013 to be a self-directing

14 customer or exempt customer, and receive natural gas from a

15 utility that provides gas service to at least 500,000 retail

16 customers in Illinois and electric service to at least

17 1,000,000 retail customers in Illinois shall be considered to

18 be a self-directing customer or exempt customer, as

19 applicable, for the current 3-year planning period effective

20 December 1, 2013.

21 (m-1) For utilities that file an amended plan for the

22 period covering calendar years 2027 through 2029, and for all

23 utilities for all calendar years covered by a multi-year plan

24 commencing on or after January 1, 2030, subsections (a)

25 through (k) of this Section do not apply to eligible customers

26 of a natural gas utility that have chosen to opt out of

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1 multi-year plans.

2 (1) For purposes of this subsection (m-1), "eligible

3 customer" means any retail customer of a natural gas

4 utility, except for federal, State, municipal and other

5 public customers, with a North American Industry

6 Classification System code number that is 22111 or any

7 such code number beginning with the digits 31, 32, or 33

8 and (i) annual usage in the aggregate of 4,000,000 therms

9 or more within the service territory of the affected gas

10 utility or with aggregate usage of 8,000,000 therms or

11 more in this State; or (ii) using natural gas as feedstock

12 and meeting the usage requirements described in item (i)

13 of this paragraph (1), to the extent such annual feedstock

14 usage is greater than 60% of the customer's total annual

15 usage of natural gas. A determination of whether this

16 subsection is applicable to a customer shall be made for

17 each multi-year plan beginning after January 1, 2026. The

18 criteria for determining whether this subsection is

19 applicable shall be the 12 consecutive billing periods

20 prior to the start of the first year of each such

21 multi-year plan.

22 (2) Within 45 days after the effective date of this

23 amendatory Act of the 104th General Assembly, the

24 Commission shall prescribe the form for notice required

25 for opting out of energy efficiency programs. Within 120

26 days after the Commission's initial issuance of the form

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1 for notice, customers described in paragraph (1) of this

2 subsection (m-1) may submit completed forms to the natural

3 gas utility. Thereafter, forms must be submitted to the

4 natural gas utility not less than 6 months before the

5 filing date of the gas utility energy efficiency plan

6 described in subsection (f) of this Section; however, a

7 new customer that commences taking service from a natural

8 gas utility after January 1, 2026 may submit a form up to

9 30 days after beginning service. The form for notice for

10 opting out of natural gas energy efficiency programs shall

11 contain the following:

12 (A) a statement indicating that the customer has

13 elected to opt-out;

14 (B) the account numbers for the customer accounts

15 to which the opt out shall apply;

16 (C) the mailing address associated with each

17 customer account identified under subparagraph (B);

18 (D) the customer's certification that, at the time

19 its form was submitted, it qualifies as an eligible

20 customer, as described in paragraph (1) of this

21 subsection (m-1);

22 (E) an American Society of Heating, Refrigerating,

23 and Air Conditioning Engineers (ASHRAE) level 2 or

24 higher audit report conducted by an independent

25 third-party expert identifying cost-effective energy

26 efficiency project opportunities that could be

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1 invested in over the next 10 years. A customer with a

2 specialized process may use a self-audit process in

3 lieu of an ASHRAE audit;

4 (F) a description of the customer's plans to

5 reallocate funds toward internal energy efficiency

6 efforts identified in the subparagraph (E) report,

7 including, but not limited to: (i) strategic energy

8 management or other programs, including descriptions

9 of targeted buildings, equipment and operations; (ii)

10 eligible energy efficiency measures; and (iii)

11 expected energy savings, itemized by technology. If

12 the subparagraph (E) audit report identifies that the

13 customer currently utilizes the best available energy

14 efficient technology, equipment, programs, and

15 operations, the customer may provide a statement that

16 more efficient technology, equipment, programs, and

17 operations are not reasonably available as a means of

18 satisfying this subparagraph (F); and

19 (G) a verification signed by a plant manager or an

20 authorized corporate officer attesting to the

21 truthfulness and accuracy of the information contained

22 in the application.

23 (3) Upon receipt of a properly and timely noticed

24 request for opt out submitted by an eligible large private

25 energy customer, the natural gas utility shall grant the

26 request and file the request with the Commission, and,

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1 beginning January 1 of the first year of the next

2 multi-year energy efficiency plan cycle, the opted out

3 customer shall no longer be assessed the costs of the plan

4 and shall be prohibited from participating in that

5 multi-year plan cycle to give the natural gas utility the

6 certainty to design program plan proposals.

7 (4) The request to opt out is only valid for the

8 requested plan cycle. An eligible large private energy

9 customer must also request to opt out for future energy

10 efficiency plan cycles, otherwise the customer will be

11 included in the future energy efficiency plan cycle.

12 (n) The applicability of this Section to customers

13 described in subsection (m) of this Section is conditioned on

14 the existence of the SDC program. In no event will any

15 provision of this Section apply to such customers after

16 January 1, 2020.

17 (o) Utilities' 3-year energy efficiency plans approved by

18 the Commission on or before the effective date of this

19 amendatory Act of the 99th General Assembly for the period

20 June 1, 2014 through May 31, 2017 shall continue to be in force

21 and effect through December 31, 2017 so that the energy

22 efficiency programs set forth in those plans continue to be

23 offered during the period June 1, 2017 through December 31,

24 2017. Each utility is authorized to increase, on a pro rata

25 basis, the energy savings goals and budgets approved in its

26 plan to reflect the additional 7 months of the plan's

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1 operation.

2 (Source: P.A. 103-613, eff. 7-1-24.)"; and

3 on page 721, by replacing lines 1 through 4 with the following:

4 "(1) has a nameplate generating capacity no greater

5 than 5,000 kilowatts and is primarily used to offset a

6 customer's electricity load, or as otherwise as defined

7 for community renewable generation projects in Section

8 1-10 of the Illinois Power Agency Act;"; and

9 on page 810, line 20, after "attributes", by inserting "to

10 ensure customers are not double-billed for the same service";

11 and

12 on page 846, by replacing lines 15 through 19 with the

13 following:

14 "made pursuant to subsection (b-10) of Section 16-111.5.".