2022 Long Term Renewable Resources Procurement Plan

Illinois Power Agency 2022 Long-Term Plan (Final) August 23, 2022

2022 Long-Term

Renewable Resources

Procurement Plan

Final Plan

Prepared to conform with the Illinois Commerce Commission’s Final

Order in Docket No. 22-0231, dated July 14, 2022.

August 23, 2022

Prepared in accordance with the

Illinois Power Agency Act (20 ILCS 3855), and the Illinois Public Utilities Act (220 ILCS 5).

RENEWABLE RESOURCES

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Table of Contents 
 Introduction ...................................................................................................................................................................... 1 
1.  Background ............................................................................................................................................................. 1 
2.  Evolution of Long-Term Plans ........................................................................................................................ 2 
3.  First Revised Plan Accomplishments ........................................................................................................... 3 
4.  Plan Organization ................................................................................................................................................. 4 
5.  Action Plan .............................................................................................................................................................. 5 
 Statutory Requirements of the Plan ........................................................................................................................ 6 
1.  Renewable Energy Resource Procurement Prior to Public Act 99-0906 ..................................... 6 
1.1.  Original RPS—Eligible Retail Customer Load ................................................................................. 6 
1.2.  Original RPS—Hourly Pricing Customers ........................................................................................ 7 
1.3.  Original RPS—ARES Compliance ......................................................................................................... 8 
2.  Public Act 99-0906 .............................................................................................................................................. 8 
2.1.  P.A. 99-0906—Overview ......................................................................................................................... 9 
2.2.  Changes to the RPS through P.A. 99-0906 ....................................................................................... 9 
2.3.  The Long-Term Renewable Resources Procurement Plan ...................................................... 14 
3.  RPS Implementation: 2017-2021 ................................................................................................................ 15 
3.1.  Successes and Challenges ...................................................................................................................... 15 
3.2.  Legislative Proposals .............................................................................................................................. 17 
4.  Public Act 102-0662: The Climate and Equitable Jobs Act ............................................................... 18 
5.  Long-Term Renewable Resources Procurement Plan ........................................................................ 20 
5.1.  Plan Requirements ................................................................................................................................... 20 
5.2.  Items Not Included in Long-Term Renewable Resource Procurement Plan ................... 28 
5.3.  2022 Long-Term Plan Development and Approval.................................................................... 29 
5.4.  Plan Updates ............................................................................................................................................... 29 
6.  The RPS and Percentage-Based Goals of the RPS ................................................................................. 30 
6.1.  Load Applicable to RPS Goals .............................................................................................................. 30 
6.2.  Eligible Projects for the Illinois RPS ................................................................................................. 31 
6.3.  Compliance Mechanism: RECs vs. “Renewable Energy Resources” .................................... 35 
6.4.  RPS Funding and Rate Impact Cap .................................................................................................... 36 
7.  Quantitative New Build Targets of the RPS ............................................................................................. 37 
7.1.  Quantitative Procurement Requirements ...................................................................................... 37 
7.2.  “New wind project” and “new photovoltaic project” Definition ........................................... 37 
7.3.  Forward Procurements Conducted Outside of This Plan ........................................................ 38 
7.4.  Competitive Procurements Proposed Through This Plan ....................................................... 39 
8.  Adjustable Block Program & Community Renewable Generation ................................................. 41 
8.1.  Adjustable Block Program .................................................................................................................... 42 
8.2.  Community Renewable Generation Projects ................................................................................ 48 
9.  Illinois Solar for All Program ......................................................................................................................... 50 
9.1.  Illinois Solar for All—Overview .......................................................................................................... 50 
9.2.  Illinois Solar for All—Sub-programs ................................................................................................ 52 
9.3.  Illinois Solar for All—Additional Requirements .......................................................................... 55 
9.4.  Illinois Solar for All—Third-party Program Administrator .................................................... 58 
9.5.  Illinois Solar for All—Referrals ........................................................................................................... 58 
10.  Diversity, Equity, and Inclusion Requirements ..................................................................................... 59 
11.  Self-direct Renewable Portfolio Standard Compliance Program ................................................... 61 
 REC Portfolio, RPS Goals, Targets, and Budgets ............................................................................................... 63 
1.  Background ........................................................................................................................................................... 63 
2.  REC Portfolio ........................................................................................................................................................ 64 

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2.1.  Existing REC Portfolios – RECs Already Under Contract .......................................................... 64 
3.  RPS Goals and Targets ...................................................................................................................................... 66 
3.1.  RPS Goals ...................................................................................................................................................... 66 
3.2.  RPS Targets ................................................................................................................................................. 67 
3.3.  Applicable Retail Customer Load Used to Calculate RPS Goals ............................................. 68 
3.4.  Overall REC Procurement Targets and Goals – REC Gap ......................................................... 69 
3.5.  Procurement Targets to Meet Specific Wind-Solar Requirement and Overall RPS 
Targets .......................................................................................................................................................... 72 
4.  RPS Budget ............................................................................................................................................................ 74 
4.1.  Statewide Goals and Allocation of Cost and RECs from RPS Procurements to Each 
Utility............................................................................................................................................................. 74 
4.2.  Cost Cap and Cost Recovery Provisions .......................................................................................... 75 
4.3.  RPS Compliance Procurement Priorities ........................................................................................ 77 
4.4.  RPS Budget and Cost Cap ...................................................................................................................... 78 
4.5.  Other Expenses .......................................................................................................................................... 80 
4.6.  Expenses and Available RPS Budgets ............................................................................................... 80 
4.7.  Budget Uncertainty Due to Unknowns in Project Energization Timelines ....................... 84 
4.8.  Budget Uncertainty Due to Annual Load Variations .................................................................. 84 
5.  Alternative Compliance Payment Funds Held by the Utilities......................................................... 86 
6.  Section 1-75(c)(1)(H)(i) ARES Option to Supply RECs for their Retail Customers ................ 87 
7.  MidAmerican Volumes ..................................................................................................................................... 88 
7.1.
  Initial Change to MidAmerican’s Load Forecast Methodology .............................................. 89 
7.2.  Correcting for the Unintended Consequences of MidAmerican’s Forecast Approach . 91 
 Renewable Energy Credit Eligibility ..................................................................................................................... 93 
1.  Introduction ......................................................................................................................................................... 93 
2.  REC Eligibility ...................................................................................................................................................... 93 
3.  Adjacent State Requirement .......................................................................................................................... 93 
4.  Cost Recovery Requirement ....................................................................................................................... 102 
5.  High-Voltage Direct Current Transmission Lines and Converter Stations ............................. 104 
6.  Application Process ........................................................................................................................................ 105 
 Competitive Procurements .................................................................................................................................... 107 
1.  Background - Agency Approach in Past Procurements ................................................................... 107 
2.  Past REC Procurements conducted by the IPA ................................................................................... 109 
3.  Statutory Requirements ............................................................................................................................... 113 
4.  New Requirements under P.A. 102-0662 ............................................................................................. 114 
4.1  RPS Budgets ............................................................................................................................................. 115 
4.2  Brownfield Site Photovoltaic Project Procurements .............................................................. 115 
4.3  Labor, Diversity and Equity Requirements................................................................................. 116 
4.4  Indexed REC Pricing Requirements ............................................................................................... 120 
4.5  Indexed REC Settlement ..................................................................................................................... 120 
4.6  Forward Price Curve ............................................................................................................................ 121 
4.7  Application of the Price Curve .......................................................................................................... 122 
5.  Proposed Procurement Events .................................................................................................................. 122 
5.1.  Utility-Scale Solar and Utility-Scale Wind ................................................................................... 123 
5.2.  Brownfield Site Photovoltaic ............................................................................................................ 124 
5.3.  Non-Photovoltaic Community Renewable Generation .......................................................... 124 
5.4.  Procurement of RECs from Renewable Energy Resources other than New Wind and 
Solar ............................................................................................................................................................ 125 
6.  Proposed Schedule for Competitive Procurements .......................................................................... 125 
6.1.  Proposed Schedule for Competitive Procurements ................................................................ 126 

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7.  Contracts ............................................................................................................................................................. 127 
7.1.  Credit Requirements ............................................................................................................................ 127 
8.  Benchmarks ....................................................................................................................................................... 128 
 Self-Direct Renewable Portfolio Standard Compliance Program .......................................................... 129 
1.  Introduction ...................................................................................................................................................... 129 
1.1.  Self-Direct Program Overview – What is a Self-Direct Program? ...................................... 129 
1.2.   Prior RPS Self-Direct Programs in Illinois ......................................................................................... 130 
2.  Self-Direct Customer Eligibility ................................................................................................................. 131 
2.1.  Common Parents.................................................................................................................................... 131 
3.  Project Eligibility ............................................................................................................................................. 133 
3.1.  “New” Projects ........................................................................................................................................ 133 
3.2.  Locational Requirements ................................................................................................................... 133 
3.3.  Labor and DEI Requirements ........................................................................................................... 134 
4.  REC Delivery Contract Eligibility .............................................................................................................. 135 
4.1.  Contract Term ......................................................................................................................................... 136 
4.2.  Delivery Quantity Requirement....................................................................................................... 136 
5.  Self-Direct Crediting and Accounting ...................................................................................................... 137 
5.1.  Self-Direct Bill Crediting ..................................................................................................................... 137 
5.2.  Procurement Target Adjustments .................................................................................................. 142 
6.  Self-Direct Program Size & Selection ...................................................................................................... 142 
6.1.  Current Publicly Available Analyses and Studies ..................................................................... 143 
6.2.  Establishing Program Size ................................................................................................................. 145 
6.3.  Selecting Between Competing Applications ............................................................................... 146 
7.  Self-Direct Program Application Process .............................................................................................. 147 
8.  Self-Direct Program Opening ..................................................................................................................... 148 
9.  Compliance Reporting ................................................................................................................................... 149 
 Adjustable Block Program...................................................................................................................................... 150 
1.  Background ........................................................................................................................................................ 150 
1.1.  Future Energy Jobs Act ........................................................................................................................ 150 
1.2.  2021 Program Status and Lessons Learned ............................................................................... 151 
1.3.  Overview of Public Act 102-0662 Modifications ...................................................................... 152 
1.4.  Adjustable Block Program Reopening .......................................................................................... 153 
2.
  Program Administrator ................................................................................................................................ 155 
3.  Block Structure ................................................................................................................................................. 156 
3.1.  Background – Initial Program Design, Declining Price Blocks based on Capacity ..... 156 
3.2.  Transition to Annual Blocks .............................................................................................................. 158 
3.3.  Block Sizes ................................................................................................................................................ 161 
3.4.  Opening of 2022 Delivery Year Blocks & Subsequent Annual Block Openings ........... 161 
3.5.  Uncontracted Capacity at the Close of a Delivery Year .......................................................... 162 
4.  Adjustable Block Program Categories .................................................................................................... 164 
4.1.  Small Distributed Generation ........................................................................................................... 164 
4.2.  Large Distributed Generation ........................................................................................................... 164 
4.3.  Traditional Community Solar ........................................................................................................... 165 
4.4.
  Public Schools ......................................................................................................................................... 170 
4.5.  Community-Driven Community Solar........................................................................................... 171 
4.6.  Equity Eligible Contractor (“EEC”) ................................................................................................. 174 
5.  REC Pricing Model ........................................................................................................................................... 176 
5.1.  Background .............................................................................................................................................. 176 
5.2.  Modeling Update .................................................................................................................................... 178 
5.3.  Adjustments ............................................................................................................................................. 181 

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5.4.  Size Category Adjustments ................................................................................................................ 181 
5.5.  Co-location of Distributed Generation Systems ........................................................................ 181 
5.6.  Community Solar ................................................................................................................................... 182 
5.7.  Updating of REC Prices ........................................................................................................................ 183 
6.  Prevailing Wage ............................................................................................................................................... 184 
7.  Approved Vendors .......................................................................................................................................... 186 
7.1.  Supporting Stranded Distributed Generation Customers .................................................... 188 
7.2.  Approved Vendor Applications ....................................................................................................... 189 
7.3.  Equity Eligible Contractor Application Process ........................................................................ 190 
8.  Approved Vendor Designees ...................................................................................................................... 191 
8.1.
  Designee Registration .......................................................................................................................... 191 
8.2.  Equity Eligible Contractor Designees ............................................................................................ 192 
9.  Project Requirements .................................................................................................................................... 192 
9.1.  Technical System Requirements ..................................................................................................... 193 
9.2.  Metering Requirements ...................................................................................................................... 194 
9.3.  System Optimization ............................................................................................................................ 195 
9.4.  Co-location of Community Renewable Generation Projects ................................................ 196 
9.5.  Eligibility of Projects Located in Rural Electric Cooperatives and Municipal Utilities
 ...................................................................................................................................................................... 197 
9.6.  Specific Requirements for Community Solar ............................................................................. 200 
10.  Application Process ........................................................................................................................................ 202 
10.1.
  Batches ....................................................................................................................................................... 202 
10.2.  Systems below 25 kW .......................................................................................................................... 203 
10.3.  Application Fee ....................................................................................................................................... 204 
10.4.  Project Review ........................................................................................................................................ 204 
10.5.  Converting System Size into REC Quantities .............................................................................. 204 
10.6.  Batch Contract Approval .................................................................................................................... 205 
10.7.  Assignment of Projects ........................................................................................................................ 206 
11.  Project Development Timeline and Extensions .................................................................................. 207 
11.1.  Development Time Allowed .............................................................................................................. 207 
11.2.  Extensions ................................................................................................................................................ 208 
11.3.  Project Completion and Energization ........................................................................................... 208 
11.4.
  Additional Requirements for Community Solar Projects ..................................................... 210 
12.  REC Delivery ...................................................................................................................................................... 211 
12.1.  Ongoing Performance Requirements ............................................................................................ 211 
12.2.  Collateral Requirements ..................................................................................................................... 212 
12.3.  Options to Reduce REC Delivery Obligations ............................................................................. 213 
13.  Payment Terms ................................................................................................................................................ 214 
14.  Contracts ............................................................................................................................................................. 216 
15.  Annual Report ................................................................................................................................................... 218 
 Illinois Solar for All.................................................................................................................................................... 220 
1.  Overview ............................................................................................................................................................. 220 
2.  Existing and New Design Elements ......................................................................................................... 221 
2.1.
  Relationship with the Adjustable Block Program .................................................................... 221 
2.2.  Tangible Economic Benefits .............................................................................................................. 222 
2.3.  Small and Emerging Business Development .............................................................................. 225 
2.4.  Energy Sovereignty ............................................................................................................................... 226 
3.  Program Launch and Experience to Date .............................................................................................. 229 
4.  Funding and Budget ....................................................................................................................................... 232 
4.1.  Funding ...................................................................................................................................................... 232 

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4.2.  Illinois Solar for All program design, structure, and budget ............................................... 233 
4.3.  Utilities Annual Funding Available ................................................................................................. 235 
4.4.  Section 16-108(k) Funding (Now Inoperable) .......................................................................... 236 
4.5.  Setting Budgets ....................................................................................................................................... 236 
4.6.  Payment Structure ................................................................................................................................ 237 
5.  Program Requirements and Incentives ................................................................................................. 238 
5.1.  Energy Sovereignty ............................................................................................................................... 239 
5.2.  Setting Incentive Levels ...................................................................................................................... 242 
5.3.  Low-Income Single-Family and Small Multifamily Solar ...................................................... 243 
5.4.  Low-Income Large Multifamily Solar ............................................................................................ 249 
5.5.
  Low-Income Community Solar Project Initiative ..................................................................... 251 
5.6.  Incentives for Non-Profits and Public Facilities ....................................................................... 256 
5.7.  Low-Income Community Solar Pilot Projects ............................................................................ 258 
6.  Illinois Solar for All Program Administrator........................................................................................ 258 
7.  Quality Assurance ........................................................................................................................................... 260 
8.  Coordination with Other Programs ......................................................................................................... 260 
8.1.  Job Training and Placement Programs ......................................................................................... 260 
8.2.  Equity and Environmental Justice programs ............................................................................. 263 
8.3.  Energy Efficiency Programs and Community Action Agencies .......................................... 263 
8.4.  Climate Bank and the Clean Energy Jobs and Justice Fund .................................................. 264 
8.5.  Equitable Energy Upgrade Program .............................................................................................. 265 
8.6.
  Coordination with programs that support building repairs and upgrades ................... 265 
9.  Additional Requirements for Illinois Solar for All Approved Vendors ..................................... 266 
9.1.  Job Training Requirements ............................................................................................................... 267 
10.  Application Process ........................................................................................................................................ 268 
10.1.  Project Submissions and Batches ................................................................................................... 268 
10.2.  Project Selection for Sub-programs with High Demand ....................................................... 269 
10.3.  Customer Eligibility .............................................................................................................................. 270 
11.  Consumer Protections ................................................................................................................................... 275 
12.  Environmental Justice Communities ....................................................................................................... 277 
12.1.  Definitions ................................................................................................................................................ 278 
12.2.  Approach for Defining Environmental Justice Communities .............................................. 280 
12.3.  Environmental Justice Community Designations ..................................................................... 283 
12.4.  Environmental Justice Communities 25% Goal ........................................................................ 283 
13.  Program Changes ............................................................................................................................................ 283 
14.  Evaluation........................................................................................................................................................... 284 
15.  Grassroots Education Funding .................................................................................................................. 286 
16.  Ongoing Research and Education ............................................................................................................. 289 
17.  Illinois Solar for All Advisory Group........................................................................................................ 289 
 Consumer Protection ............................................................................................................................................... 291 
1.  Consumer Protection Requirements under Prior Long-Term Plans ......................................... 291 
2.  Consumer Protection Provisions Arising from Public Act 102-0662 ........................................ 293 
3.  Registration for Program Participants ................................................................................................... 294 
3.1.  Registration Requirements ............................................................................................................... 295 
3.2.  Listing of Approved Entities.............................................................................................................. 295 
3.3.  Disciplinary Determinations ............................................................................................................. 296 
4.  Program Requirements and Contract Requirements ....................................................................... 298 
4.1.  Consumer Protection Handbook ..................................................................................................... 299 
4.2.  ABP Program Requirements ............................................................................................................. 301 
4.3.  ILSFA Program Requirements .......................................................................................................... 309 

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9.5.  Standard Disclosure Form Requirements ............................................................................................. 314 
9.5.1.  ABP Disclosure Forms ......................................................................................................................... 318 
9.5.2.  ILSFA Disclosure Forms ...................................................................................................................... 320 
9.6.  Consumer Complaint Center and Complaint Database ................................................................... 322 
9.7.  Annual Complaint Report ............................................................................................................................ 323 
9.8.  Consumer Protection Working Group .................................................................................................... 324 
10.  Diversity, Equity, and Inclusion ........................................................................................................................... 326 
10.1.  Equity Accountability System .................................................................................................................... 327 
10.1.1.  Minimum Equity Standards............................................................................................................... 327 
10.1.2.  Proposed Implementation Timeline .............................................................................................. 332 
10.1.3.
  Submittal and Reporting Process.................................................................................................... 332 
10.1.4.  Enforcement of Standards ................................................................................................................. 334 
10.1.5.  Program Recruitment for a Diverse Workforce ........................................................................ 335 
10.1.6.  Modifications to the Equity Accountability System................................................................. 335 
10.2.  Equity Accountability System Assessment and Racial Disparity Study.................................... 336 
10.2.1.  Timing of Equity Accountability System Assessment and Racial Disparity Study ..... 336 
10.2.2.  Scope of Equity Accountability System Assessment and Racial Disparity Study ........ 337 
10.2.3.  Coordination with Other Agencies ................................................................................................. 337 
10.2.4.  Entity Participation ............................................................................................................................... 337 
10.3.  Program Data Collection .............................................................................................................................. 337 
10.4.  Energy Workforce Equity Database ........................................................................................................ 338 
 
Tables 
Table 3-1: Current REC Portfolio by Utility (By Expected Delivery Year) ..................................................... 65 
Table 3-2: Annual RPS Goals ............................................................................................................................................. 67 
Table 3-3: New Wind and Solar Targets ...................................................................................................................... 68 
Table 3-4: Forecast Retail Customer Load Applicable to the Compliance Year (MWH) .......................... 68 
Table 3-5: Statewide Overall Goal REC Gap
,
  .............................................................................................................. 70 
Table 3-6: Statewide RPS Goals ....................................................................................................................................... 72 
Table 3-7: Projected Deliveries of Statewide Wind and Solar RECs in the Current Portfolio................ 73 
Table 3-8: 2017-2019 Forward Procurement REC Portfolio Status ................................................................ 73 
Table 3-9: Utility REC Cost Allocations ......................................................................................................................... 75 
Table 3-10: Statewide RPS Budget Set Asides ........................................................................................................... 80 
Table 3-11: Projected RPS Expenses ($ millions) .................................................................................................... 82 
Table 3-12: RPS Funds and Expenditures ($ millions) .......................................................................................... 83 
Table 3-13: Balance of HACP as of January 13, 2022 ($) ...................................................................................... 86 
Table 3-14: Available ACPs ($)......................................................................................................................................... 86 
Table  3-15:  MidAmerican  Applicable  Load  and  RPS  Budget  before  and  after  Change  in  Forecast 
Approach ................................................................................................................................................................................... 89 
Table 4-1: Natural Gas-Fired Combined-Cycle Generation Emissions Rates ............................................... 97 
Table 4-2: Wind Duration/Direction Factors ............................................................................................................ 97 
Table 5-1: 2017-2021 Competitive Procurements Summary .......................................................................... 112 
Table 5-2: Spring 2022 Subsequent Forward Procurement Target Volumes ........................................... 114 
Table 5-3: Bid Evaluation Price Adjustments ......................................................................................................... 119 
Table 5-4: Utility-Scale REC Portfolio Status (Annual REC Volumes) ........................................................... 123 
Table 5-5:  Proposed Procurements ........................................................................................................................... 126 

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Table  6-1:  Representative  Corporate  Agreements  with  Utility-Scale  Wind  and  Utility-Scale  Solar 
Projects in Illinois ............................................................................................................................................................... 144 
Table 6-2: Major Corporate Renewable Energy Deals in Illinois Tracked by GreenBiz ........................ 145 
Table 7-1: December 2021 ABP Block Sizes ............................................................................................................ 153 
Table 7-2: Project Applications for Reopening Blocks ........................................................................................ 154 
Table 7-3: Adjustable Block Program Annual Block Opening Schedule ...................................................... 159 
Table 7-4: Proposed Annual ABP Block Capacity .................................................................................................. 161 
Table 7-5: Proposed ABP REC Prices ($/REC) for Delivery Year 2022-23 ................................................. 180 
Table 8-1: RERF Funding for Illinois Solar for All  ................................................................................................ 234 
Table 8-2: Total Illinois Solar for All Budgets ......................................................................................................... 237 
Table 8-3: Incentives for the Low-Income Single and Small Multifamily Solar Program($/REC) .... 246 
Table 8-3: Incentives for the Low-Income Large Multifamily Solar Program($/REC) .......................... 250 
Table 8-5: Incentives for Low-Income Community Solar Projects ($/REC) .............................................. 255 
Table 8-6: Incentives for Non-Profits and Public Facilities ($/REC) ............................................................ 257 
Table 8-7: HUD Income Limits ...................................................................................................................................... 271 
Table 8-8: Eligibility Guidelines for LIHEAP and IHWAP in Illinois .............................................................. 272 
Table 8-9: Summary of CalEnviroScreen 3.0 Identification Methodology .................................................. 280 
Table 9-1: Federal Statutes that Apply to Community Solar ............................................................................ 306 
Table 9-2: Illinois Statutes that Apply to Community Solar.............................................................................. 307 
 
Figures 
Figure 3-1: Current Statewide REC Portfolio (By Expected Delivery Year) .................................................. 65 
Figure 3-2: Statewide Annual RPS Goal, REC Portfolio and REC Gap .............................................................. 71 
Figure 3-3: RPS Expenditures Compared to Annual Available Funds ............................................................. 83 
Figure 3-4: Effect on RPS Budget of Annual Load Variations to the Utilities’ Load Forecast................. 85 
Figure  3-5: Comparison  of  MidAmerican’s Applicable Load  Using  the  Generation  Forecast  before 
Change and the Proposed Proxy for Determining Applicable Load and Budget ......................................... 92 
Figure 4-1: Pollution Score Calculation ........................................................................................................................ 98 
Figure 4-2: Fuel and Resource Diversity Score ......................................................................................................... 99 
Figure 4-3: Reliability and Resiliency Score ............................................................................................................ 100 
Figure 4-4: CO
2
 Score Calculpation ............................................................................................................................. 101 
Figure 8-1: ILSFA Program Years 1-3 Project Applications and Selections ............................................... 231 
Figure 8-2: Springfield Qualified Census Tracts .................................................................................................... 273 
Figure 8-3: CalEnviroScreen Formula ........................................................................................................................ 282 
Figure 9-1: Disclosure Form Project Efficiency Graphic .................................................................................... 320 
 
Appendices 
Appendix A:    Legislative Compliance Index 
Appendix B-1:  Summaries of Goals and Targets, RPS Portfolios, and Budgets 
Appendix B-2:  Full REC and Budget Portfolio Spreadsheet 
Appendix C:    Review of other State REC Pricing Approaches 
Appendix D:    Renewable Energy Credit Pricing Model Description 
Appendix E:    Renewable Energy Credit Pricing Model Spreadsheet 
Appendix F:     Income Eligibility Guidelines for Illinois Solar For All 

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Appendix G: Review of Approaches to Energy Sovereignty

Appendix H: Illinois Solar for All Evaluation Report

Appendix I-1: Adjustable Block Program and Illinois Solar for All Program Consumer Protection

Handbook and Contract Requirements

Appendix I-2: Adjustable Block Program and Illinois Solar for All Program Disclosure Forms

Appendices are available separately at:

https://ipa.illinois.gov/energy-procurement/2022-ltrrpp-appendices.html

Illinois Power Agency 2022 Long-Term Plan (Final) August 23, 2022

1. Introduction

This document constitutes the final version of the 2022 Revised Long-Term Renewable Resources

Procurement Plan (“2022 Long-Term Plan,” or “Plan”) of the Illinois Power Agency (“IPA” or

“Agency”) consistent with the Final Order of the Illinois Commerce Commission (“ICC” or

“Commission”) entered on July 14, 2022.

This Plan reflects substantial changes made to the Illinois Renewable Portfolio Standard (“Illinois

RPS” or “RPS”) through the enactment of Public Act 102-0662 (colloquially known as the “Climate

and Equitable Jobs Act”) on September 15, 2021. The Plan also presents certain updates that the

Agency had previously proposed in a draft Second Revised Long-Term Plan, which the Agency

withdrew from public comments after the enactment of Public Act 102-0662. This Plan will cover

the renewable energy procurement and programmatic activities conducted by the Agency over the

next two years.

1.1. Background

The Initial Long-Term Renewable Resources Procurement Plan (“Initial Plan”) was developed by the

IPA pursuant to the provisions of Sections 1-56(b) and 1-75(c) of the Illinois Power Agency Act (“Act”

or “IPA Act”), and Section 16-111.5 of the Public Utilities Act (“PUA”). That Initial Plan

was

developed under authority established through Public Act 99-0906 (“P.A. 99-0906”), enacted

December 7, 2016 (effective June 1, 2017), which substantially revised the Illinois Renewable

Portfolio Standard (“Illinois RPS” or “RPS”). The Initial Plan was approved by the Commission on

April 3, 2018 in Docket No. 17-0838 and covered the Agency’s renewable energy resources

procurement and programmatic activities for the following two years. The Agency published the

final Initial Plan on August 6, 2018.

Section 16-111.5(b)(5)(ii)(B) of the PUA provides that “[the Agency] shall review, and may revise,

the plan at least every 2 years thereafter.” That subparagraph further provides that “[t]o the extent

practicable, the Agency shall review and propose any revisions to the long-term renewable energy

resources procurement plan in conjunction with the Agency's other planning and approval processes

conducted under this Section.” The first Long-Term Plan update process was undertaken by the

Agency in 2019 starting with stakeholder feedback opportunities, and on August 15, 2019, a draft

Revised Plan was released for public comment concurrently with the IPA’s release of its draft 2020

Electricity Procurement Plan. The Revised Plan was filed for Commission approval on October 21,

2019 and reflected the Agency’s consideration of comments received.

Under Section 16-111.5(b)(5)(ii)(C) of the PUA, the Commission then had 120 days to review the

Revised Plan and enter its Order confirming or modifying the Plan. The Commission approved that

Plan on February 18, 2020 and the Agency published a final version (“First Revised Plan”) on April

20, 2020. The Agency subsequently petitioned the Commission to reopen the First Revised Plan to

provide modifications addressing pressing RPS budget issues on March 3, 2021. The Commission

The Initial Plan is available at

https://www2.illinois.gov/sites/ipa/Documents/2019ProcurementPlan/Long%20Term%20Renewable%20Resources%20Procuremen

t%20Plan%20%288-6-18%29.pdf.

Illinois Power Agency 2022 Long-Term Plan (Final) August 23, 2022

approved those modifications on May 27, 2021 and the Agency filed a First Revised Plan on

Reopening in conformance with that Order on June 7, 2021.

Following that two-year plan updating cycle, the Agency then again conducted stakeholder feedback

opportunities and released a draft Second Revised Long-Term Plan on August 16, 2021 for public

comment (concurrent with the release of the draft 2022 Electricity Procurement Plan). However,

before comments on that Plan were due, in early September of 2021 the General Assembly passed

comprehensive energy legislation in the form of amendments to Senate Bill 2408. That legislation

was signed by the Governor, and became effective, on September 15, 2021 as Public Act 102-0662.

That Act contained a provision that within 120 days, after its effective date, “the Agency shall release

for comment a revision to the long-term renewable resources procurement plan, updating elements

of the most recently approved plan as needed to comply with this amendatory Act of the 102nd

General Assembly, and any long-term renewable resources procurement plan update published by

the Agency but not yet approved by the Illinois Commerce Commission shall be withdrawn for public

comment.” As a result, the Agency withdrew the draft Second Revised Plan and began the process of

preparing a draft 2022 Long-Term Plan.

For this new 2022 Long-Term Plan, the Agency issued requests for stakeholder feedback in

November 2021 and released a draft 2022 Long-Term Plan on January 13, 2022. After the receipt of

public comments on that draft Plan, the Agency updated the Plan and filed the 2022 Long-Term Plan

for approval by the Illinois Commerce Commission on March 21, 2022 in Docket No. 22-0231 and the

Commission approved that Plan with modification on July 14, 2022.

This Final Plan reflects changes arising from the Commission’s Order confirming and modifying the

filed Plan. The Plan as filed has been amended consistent with the IPA’s understanding of the Final

Order issued by the Commission in Docket No. 22-0231. While the Agency has strived to fully and

accurately reflect the Commission’s Order in this update, in the case of any unintended

inconsistencies between this Final Plan and the Commission’s Order, the Final Order issued by the

Commission shall govern.

See Chapter 2 for additional information on the Plan approval process.

1.2. Evolution of Long-Term Plans

The Initial Plan addressed the Agency’s proposed set of programs and competitive procurements to

acquire renewable energy credits (“RECs”) for RPS compliance obligations applicable to three Illinois

electric utilities: Ameren Illinois Company (“Ameren Illinois”), Commonwealth Edison Company

(“ComEd”), and MidAmerican Energy Company (“MidAmerican”). The Initial Plan also described how

the Agency would develop and implement the Illinois Solar for All (“ILSFA”) Program, which utilizes

a combination of funds held by the Agency in the Renewable Energy Resources Fund (“RERF”) and

funds supplied by the utilities from ratepayer collections, to support the development of photovoltaic

(“PV”) resources, along with job training opportunities (supported separately) to benefit low-income

households and environmental justice communities across the State of Illinois. The First Revised Plan

updated those programs and procurements where applicable.

The First Revised Plan covered the Agency’s proposals for procurements and program activity to be

conducted during calendar years 2020 and 2021. As discussed throughout that Plan, absent

legislative changes, RPS budget limitations would constrain the ability of the Agency to conduct

additional procurements or expand program capacity for its Adjustable Block Program. That concern

Illinois Power Agency 2022 Long-Term Plan (Final) August 23, 2022

proved accurate, and the Agency was unable to open additional blocks of capacity for the Adjustable

Block Program beyond those envisioned through the Initial Plan. However, Public Act 102-0662

required opening new blocks of Adjustable Block Program capacity prior to the approval of a new

Long-Term Plan by December 14, 2021. P.A. 102-0662 also mandated that the Agency hold

procurements for RECs from new utility-scale wind, solar, and brownfield site photovoltaic projects

prior to this Plan’s approval; those procurements occurred in May 2022.

Public Act 102-0662 contains significant changes to the RPS. Key changes include:

• New “40% by 2030” and “50% by 2040” RPS goals, including a new target of 45 million RECs

from new wind and solar projects delivered annually by 2030.

• An increase of the rate used for collections from ratepayers of funding, and changes to

accounting procedures to provide more flexibility for the timing of expenditures.

• Changes to REC procurements conducted to support new utility-scale wind and solar projects

through incorporating Indexed REC pricing.

• A large customer self-direct program that allows very large electric customer to directly

procure REC from new utility-scale wind and solar projects and reduce their RPS compliance

costs.

• Changes to the Adjustable Block Program to create three new categories of projects for

projects located at public schools, community-driven community solar, and projects from

equity eligible contractors.

• Changes to the Illinois Solar for All Program including dedicated support for projects that

promote energy sovereignty.

• Expansion, reinforcement, and codification of consumer protection standards applicable to

transactions under IPA programs.

• New diversity, equity, and inclusion requirements on the renewable energy industry,

including the implementation of an Equity Accountability System for Agency’s renewable

energy programs and procurements.

• Labor requirements, including prevailing wage requirements, applicable to the Agency’s

renewable energy programs and procurements.

This 2022 Long-Term Plan describes how the Agency will implement these and other new provisions.

The Plan also includes incorporates certain proposals previously contained in the withdrawn Second

Revised Plan that the Agency believed would improve programs and procurements.

The Agency has restructured this Plan compared to previous versions. This includes new chapters

and reorganized sections within chapters. Therefore, section references to previous plans are likely

not applicable to this 2022 Long-Term Plan.

With the finalization of the 2022 Long-Term Plan, the Agency will next update the Long-Term Plan

starting in 2023 for approval in 2024 to cover activities for 2024 and 2025.

1.3. First Revised Plan Accomplishments

Subsequent to the approval of the First Revised Plan by the Commission on February 21, 2020, the

programs and procurements discussed in this Plan met the following milestones:

• Block capacity for the Adjustable Block Program filled (by March 2020 for Large Distributed

Generation; December 2020 for Small Distributed Generation).

Illinois Power Agency 2022 Long-Term Plan (Final) August 23, 2022

• The third program year of the Illinois Solar for All Program opened in June 2020. Project

applications filled the available funding for the non-profit/public facilities and low-income

community solar sub-programs, while project applications in the distributed generation sub-

program continued to not meet program goals. The fourth year of the program opened in June

2021.

• A new-wind forward procurement (1 million RECs annually from new utility-scale wind

projects) was conducted in March 2021. No projects were selected.

Additionally, many program materials were updated (including Marketing Guidelines, Disclosure

Forms, the Adjustable Block Program Guidebook, and individual program websites) and the Agency

has conducted numerous stakeholder feedback and comment processes.

The ongoing COVID-19 global pandemic significantly contributed to delays in project completions in

2020 and 2021. Nonetheless, as of the finalization of this 2022 Long-Term Plan, 98% of Distributed

Generation projects and 84% of Community Solar projects from initial Adjustable Block Program

blocks have been energized and processed for REC payments.

1.4. Plan Organization

This 2022 Long-Term Plan contains 10 chapters.

Chapter 1 is the Introduction, which contains a brief overview of the Plan and a set of action items

the Agency requested the Commission expressly adopt as part of its approval of this Plan.

Chapter 2 provides an overview of the statutory requirements governing this Plan contained in the

Illinois Power Agency Act and the Public Utilities Act, including a historical overview of the Illinois

RPS’s development and evolution and an outline of the significant changes in Illinois law resulting

from the enactment of Public Act 102-0662.

Chapter 3 contains calculations of RPS targets, summaries of RPS portfolios, and summaries of RPS

budgets.

Chapter 4 discusses the eligibility of RECs for use in the Illinois RPS. Specifically, it addresses two

requirements of the RPS: eligibility of RECs from facilities in adjacent states, and the requirement

that RECs cannot be procured from facilities that recover their costs through regulated rates.

Chapter 5 describes the competitive procurement process and the procurements the Agency plans to

conduct for the delivery of RECs from new utility-scale wind and solar projects and brownfield site

photovoltaic projects.

Chapter 6 describes the new large customer self-direct program to be implemented by the Agency.

This program does not feature the procurement of RECs by the Agency on behalf of the utilities, but

instead authorizes a credit for certain qualifying REC purchases through long-term contracts by large

electric customers.

Chapter 7 describes the Adjustable Block Program, which includes details on the following: the

structure of the blocks; program categories; REC prices; the application process; payment terms; the

process for approving vendors and designees; project specifications; delivery requirements; and

more. This chapter consolidates chapters 6 and 7 in the previous plans, which separately considered

provisions related to distributed generation and community solar. Considerations related to

consumer protections are now contained in a new Chapter 9.

Illinois Power Agency 2022 Long-Term Plan (Final) August 23, 2022

Chapter 8 describes the Illinois Solar for All Program including the program funding and design,

customer terms, conditions, and eligibility, and the approach for designating environmental justice

communities.

Chapter 9 describes how the Agency implements consumer protection standards. Public Act 102-

0662 created new statutory provisions related to consumer protections in IPA programs, and this

chapter codifies the Agency’s approach to implementing those requirements.

Chapter 10 describes the Agency’s commitment to diversity, equity, and inclusion in the renewable

energy industry through the implementation of the Equity Accountability System, conducting a racial

disparity study, and development of an Energy Workforce Equity Database.

1.5. Action Plan

For this 2022 Long-Term Plan, the IPA recommended that the ICC expressly approve the following

items as part of the Plan’s approval:

1. Approve the RPS targets, and budget estimates for Ameren Illinois, ComEd, and MidAmerican

for the delivery years 2022-2023 through 2023-2024 contained in Chapter 3, including the

forecast used for this Plan, and additionally stipulate that Ameren Illinois, ComEd, and

MidAmerican will provide updated load forecasts and budget data to the Agency on a

biannual basis (each spring and fall) to allow the Agency to update those numbers.

2. Approve the continuation of the Agency’s approach for considering and weighting the public

interest criteria related to facilities located in adjacent states that is contained in Chapter 4.

3. Approve the procurements contained in Chapter 5 including the changes to the procurement

process to incorporate the Indexed REC approach.

4. Approve the design of the large customer self-direct program contained in Chapter 6

including the process for determining the program size, application process, bill crediting

methodology.

5. Approve the continuation of the basic design of the Adjustable Block Program contained in

Chapter 7, and approve updates to block design, program categories, schedule of REC prices,

and program terms and conditions.

6. Approve the process for the submission, review, and approval of the proposed contracts to

procure renewable energy credits or implement the programs authorized by the Commission

as primarily outlined in Chapters 5, 7, and 8.

7. Approve the continuation of the basic design and terms and conditions of the Illinois Solar

for All Program contained in Chapter 8, as well as the updates proposed in this 2022 Long-

Term Plan.

8. Approve the consumer protection standards contained in Chapter 9.

9. Approve the Agency’s approach to minimum equity standards contained in Chapter 10.

The Illinois Power Agency respectfully files this Final 2022 Long-Term Renewable Resources

Procurement Plan, which reflects the Commission’s Final Order in Docket No 22-0231 approving and

modifying this Plan consistent with Section 16-111.5 of the PUA.

Illinois Power Agency 2022 Long-Term Plan (Final) August 23, 2022

2. Statutory Requirements of the Plan

This Chapter of the IPA’s Long-Term Renewable Resources Procurement Plan (“Long-Term

Renewables Plan” or “Plan”) describes the statutory requirements applicable to the Long-Term

Renewables Plan, with a particular focus on changes made through Public Act 102-0662 (colloquially

known as the “Climate & Equitable Jobs Act”), which took effect on September 15, 2021 beginning

the 120-day deadline for the initial publication of this Plan. While not inclusive of all such

requirements, this Chapter attempts to outline primary requirements while directing readers to

individual Sections and Chapters in which the Agency’s implementation approach to satisfying those

requirements is explained in detail.

A Statutory Compliance Index, Appendix A, provides a complete cross-index of statutory

requirements and the specific sections of this Plan that address each requirement identified.

2.1. Renewable Energy Resource Procurement Prior to Public Act 99-0906

The Agency has been producing procurement plans addressing renewable energy resource

procurements since 2008 and conducting renewable energy resource procurements since 2009, and

it is helpful to understand the background of the Illinois Renewable Portfolio Standard’s (“RPS”)

RPS’s original structure and implementation challenges in understanding the changes made through

Public Acts 99-0906 and now 102-0662.

Prior to P.A. 99-0906 (colloquially known as the “Future Energy Jobs Act”), the Illinois RPS effectively

had three compliance mechanisms depending on a customer’s supply source: eligible retail customer

procurements, Alternative Retail Electric Supplier (“ARES”) compliance, and hourly pricing customer

compliance payments. Below is an outline of the pre-P.A. 99-0906 RPS, provided for background;

please note that the structure outlined in Section 2.1 below no longer governs RPS implementation

and compliance in Illinois.

2.1.1. Original RPS—Eligible Retail Customer Load

Of the three former RPS compliance mechanisms, the compliance pathway that looked most like the

present RPS was that which applied to “eligible retail customers,” or those customers still taking

default supply service from their electric utility (ComEd and Ameren Illinois, and starting in 2015,

MidAmerican). The Agency’s annual procurement plans (developed primarily to propose

procurements intended to meet the energy, capacity, and other standard wholesale product

requirements of eligible retail customers) were required to also include procurement proposals

intended to meet annually-climbing, percentage-based renewable energy resource targets. As with

block energy procured by the Agency, the applicable utility served as the counterparty to resulting

contracts.

Sub-targets were also introduced to the overall procurement volumes: of the renewable energy

resources procured, 75% were required to come from wind, 6% from photovoltaics, and 1% from

distributed generation. Prior to June 1, 2011, resources from Illinois were expressly prioritized

(looking to adjoining states if none were available in-state, and then elsewhere); after June 1, 2011,

the RPS required looking to Illinois and adjoining states together as a first priority, and then

elsewhere. Funds available for use under RPS contracts were subject to a rate impact cap—a fixed

bill impact cap percentage (2.015% of 2007 rates), which was then applied to eligible retail customer

load to produce a renewable resources procurement budget.

Illinois Power Agency 2022 Long-Term Plan (Final) August 23, 2022

This system may have worked more effectively had Illinois not experienced significant volatility in

the size of its eligible retail customer load. Upon the establishment of the IPA in 2007, however, the

General Assembly required that electric utilities execute relatively long-term energy supply contracts

(known as the “swap contracts”) to serve eligible retail customer load. In the years that followed,

energy prices plummeted in the wholesale market, yet these swap agreements served to inflate the

default supply rate well above that which could be offered by a competitive supplier. From 2011 to

2013, significant populations of default supply customers switched to ARES service, often through

opt-out municipal aggregation,

and eligible retail customer load dwindled, causing a corresponding

decline in the annual available renewable resources budget.

As part of its 2009 Annual Procurement Plan, the Agency proposed, and the Commission approved, a

procurement for “bundled” (energy and REC) long-term contracts from renewable energy suppliers

(known as the Long-Term Power Purchase Agreements, or “LTPPAs”). The LTPPA contracts were

executed through a 2010 procurement event, with winning suppliers receiving 20-year bundled

contracts to help meet future years’ RPS targets. While this procurement helped facilitate significant

new renewable energy development in Illinois (especially in the form of wind projects), it also

provided a floor of annual payment obligations under the renewable resources budget for future

years.

As the annual renewable resources budget declined due to customer load moving to ARES supply,

not only was funding unavailable to conduct additional renewable energy resource procurements,

but funding was also no longer available to meet the full commitments of the LTPPAs described

above. As a result, for two years ComEd’s LTPPAs were “curtailed” (payment was not made through

the renewable resources budget for the full expected output). Due to the unpredictability of available

budgets in future years, the Agency’s annual procurement plans after the 2010 LTPPAs proposed

only

the procurement of one-year contracts to meet each upcoming delivery year’s renewable

energy resource obligations. As obtaining financing for developing new facilities generally required

revenue certainty over a long period, this short-term focus left the prior RPS as an ineffective (or

“broken”) tool for facilitating the development of new renewable energy generation.

2.1.2. Original RPS—Hourly Pricing Customers

Beginning with the 2010 delivery year through June 1, 2017, Section 1-75(c)(5) of the Act required

that the applicable electric utility apply “the lesser of the maximum alternative compliance payment

rate or the most recent estimated alternative compliance payment rate for its service territory for

the corresponding compliance period” to hourly pricing customers. Those funds were held by the

electric utility and utilized to supplement to the Agency’s annual procurement planning process.

Because contracts with distributed generation systems required contracts of at least 5 years, the IPA

used these hourly Alternative Compliance Payments (“ACPs”) to serve as the funding source for

procurements supporting DG development, including DG procurements approved in the IPA’s 2017

Annual Procurement Plan.

Under Section 1-92 of the Act, municipalities, whether individually or in a coalition with others, may aggregate residential and small

commercial electric loads and leverage economies of scale to negotiate favorable electric supply rates for those customers.

The lone exception to this was the procurement of statutorily mandated five-year distributed generation procurements using alternative

compliance payments.

Illinois Power Agency 2022 Long-Term Plan (Final) August 23, 2022

As discussed in detail in Chapter 3, even accounting for payments still to be made under those DG

procurements, some balance of prior-collected hourly ACPs remains for REC procurements.

2.1.3. Original RPS—ARES Compliance

Lastly, the ARES RPS compliance mechanism, adopted in 2009, was more complex. Under Section

16-115D of the Public Utilities Act, each ARES carried a percentage-based renewable portfolio

standard requirement similar to the Section 1-75(c) requirement as a percentage of its sales, but

could satisfy its obligation by making alternative compliance payments at a rate reflecting that rate

paid by eligible retail customers for no less than 50% of its obligation. For the remaining 50% of its

obligation, the ARES could either make additional alternative compliance payments and/or self-

procure RECs from a broad geographic footprint.

With ARES competing with one another for customers (and against default supply service), this

paradigm created an incentive for an ARES to comply at the lowest cost possible.

Thus, alternative

compliance payments were generally made for the minimum 50% amount, and the self-procurement

obligation was not structured to lead to the development of new renewable energy generation.

Alternative compliance payments were deposited into the IPA-administered Renewable Energy

Resources Fund. Due to statutory constraints, leveraging this fund for procurements carried

significant challenges, as the IPA outlined in detail its 2015 Supplemental Photovoltaic Procurement

Plan. In addition, as a special state fund, the RERF could always be—and indeed was—subject to the

risks of borrowing and transfers. Given these risks, and given the State’s inability to enact a budget

from July 1, 2015 until August 31, 2017 (thereby leaving the IPA without appropriation authority to

make payments under contracts regardless of actual funds available), the State of Illinois was an

unattractive counterparty for REC delivery contracts.

With the majority of Illinois electric load being served by ARES,

this stood as no small problem—

while the RPS technically covered most of the electricity delivered in the state, very little new

renewable generation was able to be developed through it. Significant amounts were being paid into

the RERF each year to support renewable energy development, yet the money was unable to be

effectively leveraged for that purpose. While ARES were procuring millions of RECs in aggregate each

year, the incentive structure facing those suppliers made it highly unlikely that those RECs would be

sourced from anything other than the lowest-priced seller: generally, facilities already built and

financed, and potentially from projects in vertically integrated states with costs already being fully

recovered through rates. Hence, parties seeking changes to this system often characterized the

Illinois RPS as a “broken RPS,” and one that would require a comprehensive legislative overhaul to

be properly fixed.

2.2. Public Act 99-0906

The Agency’s initial obligation to develop a Long-Term Renewable Resources Procurement Plan for

managing RPS implementation stems from requirements included in Public Act 99-0906. P.A. 99-

0906 was passed by both the Illinois House and Senate during the last days of the 99th General

To the extent that a customer sought a more environmentally friendly product, the ARES could always offer a “green” product including

100% of megawatt-hours matched with renewable energy credits, disconnected from any RPS compliance obligation.

See, e.g., https://www.icc.illinois.gov/downloads/public/2017%20ORMD%20Section%2020-110%20report.pdf.

Illinois Power Agency 2022 Long-Term Plan (Final) August 23, 2022

Assembly on December 1, 2016, and was signed into law on December 7, 2016, with an effective date

of June 1, 2017.

P.A. 99-0906’s changes to the RPS were intended to address many of the challenges outlined above,

especially to ensure that the RPS collections could be effectively leveraged to support new renewable

energy project development.

2.2.1. P.A. 99-0906—Overview

In addition to the requirement that the Agency develop its Long-Term Renewable Resources

Procurement Plan and implement the programs and procurement discussed herein, P.A. 99-0906

also contained other significant reforms to Illinois energy law. Among those reforms included the

establishment of a zero emission standard requiring the Agency to develop a Zero Emission Standard

Procurement Plan for the procurement of zero emission credits from select at-risk zero emission (i.e.,

nuclear) generating facilities;

revisions to the state’s energy efficiency portfolio standard found in

Article VIII of the Public Utilities Act (220 ILCS 5), including the elimination of the statutory pathway

by which incremental energy efficiency programs were included in the IPA’s annual procurement

plans;

additional financial assistance for low-income ratepayers;

bill crediting for the energy

production associated with subscriptions to community renewable generation;

and a smart inverter

rebate for behind-the-meter generating facilities.

2.2.2.

Changes to the RPS through P.A. 99-0906

Public Act 99-0906 ushered in several changes to the RPS, including the introduction of new

concepts, terms, and prescriptive requirements. Several of these concepts are discussed below, in

the subsections later in this chapter, and in the Chapters that follow. Where applicable, the status of

these changes under P.A. 102-0662’s new RPS framework are also noted.

2.2.2.1. P.A. 99-0906—RPS Funding

P.A. 99-0906 constituted a comprehensive overhaul of the state’s renewable energy portfolio

standard, elements of which can be found in Sections 1-56 and 1-75(c) of the IPA Act and Section 16-

115D of the PUA. Under the prior Illinois RPS, compliance and planning depended on how a

customer’s supply requirements were met, with three separate compliance mechanisms for default

utility supply service, hourly-pricing customers, and load served by Alternative Retail Electric

Suppliers. Changes to the Illinois RPS through P.A. 99-0906 fully transitioned the state’s RPS to a

streamlined, centralized planning and procurement process, with both RPS targets and available

The Agency’s Zero Emission Standard Procurement Plan, developed pursuant to new Section 1-75(d-5) of the Act, was filed with the

Commission on July 31, 2017 and was approved by the Commission on September 11, 2017. See ICC Docket No. 17-0333.

See 220 ILCS 5/16-111.5B.

See 220 ILCS 5/8-103B(c) (requiring ComEd and Ameren Illinois to allocate $25 million and $8.5 million, respectively, annually for low-

income energy efficiency programs); 305 ILCS 20/18(c)(5), (5.5), (7) (authorizing Percentage of Income Payment Plan (“PIPP”) qualified

customers to receive credits under a utility’s Arrearage Reduction Program, and creating a new Supplemental Arrearage Reduction

Program for utility customers who cannot join the PIPP due to timing or funding constraints); 220 ILCS 5/16-108.10 (creating new $10

million annual funding stream over five years for low-income assistance programs for ComEd customers).

See 220 ILCS 5/16-107.5(l).

See 220 ILCS 5/16-107.6.

Illinois Power Agency 2022 Long-Term Plan (Final) August 23, 2022

budgets determined based on an electric utility’s load for all retail customers

and funding collected

through a delivery services charge.

While the rate impact cap found under Section 1-75(c)(1)(E) of the IPA Act technically remained the

same under Public Act 99-0906 – 2.015% of 2007 rates – budgets available to support renewable

energy projects increased significantly, as that rate impact cap applied now to all retail sales instead

of only eligible retail customer load. In prior years, the annual RPS budget managed by the Agency

could range from $30 million to $100 million, with the Agency having little visibility in advance as to

what future years’ budgets would be due to the issues outlined above in Section 2.1.1. Through Public

Act 99-0906, by 2019, annual RPS budgets stabilized in the range of $220 million to $230 million per

year, not considering prior-collected ACPs. This increased level of funding was essential to meet the

more aggressive targets found in the revised Illinois RPS, specifically targets related to ensuring that

RECs were being procured from new wind and photovoltaic projects that may never have been

developed but for the availability of funding through REC delivery contracts.

As discussed later in this Chapter and especially across Chapter 3, Public Act 102-0662 further increased

these budgets and now allows for collections to be leveraged across multiple delivery years, such that

prior years’ collections can now be utilized meet future years’ expenses.

2.2.2.2. P.A. 99-0906—Focus on RECs

P.A. 99-0906 demonstrated a shift in focus from compliance through the procurement of “renewable

energy resources”—which may be either 1) a renewable energy credit associated with a megawatt-

hour (“MWh”) of generation, or 2) that REC plus the associated generation—to compliance through

the purchase and retirement of “renewable energy credits.”

This change makes intuitive sense; the

purchase of energy is not addressed through this planning process, and the Agency’s planning for any

energy purchases can only be for utility default supply customers (i.e., eligible retail customers)

through the development of a separate procurement plan (which focuses on a shorter timeframe than

many of the REC contracts envisioned in the revised RPS).

That framework continues under P.A. 102-0662, with RPS goal progress measured through the

procurement of RECs rather than renewable energy resources. The IPA’s 2022 Long-Term Plan thus

continues to only concern REC procurements, and not the procurement of energy or capacity from

projects facilitated by this Plan’s proposals.

2.2.2.3. P.A. 99-0906—RPS Targets and Goals

P.A. 99-0906 continued with a “25% by 2025” RPS trajectory that had previously been contained in

Section 1-75(c) since its enactment in 2008—meaning that 25% of eligible load should be met by

RECs procured by the Agency by the year 2025—but just as funds to support REC procurements were

now to be collected from all retail customers, that goal was likewise applied to all retail customer

load. A higher priority requirement was minimum procurement quantities of RECs from “new” wind

For MidAmerican, the IPA understands that Section 1-75(c)’s renewable energy procurement targets are generally applied to the supply

procured for MidAmerican’s jurisdictional eligible retail customers and not all retail sales in its service territory.

See, e.g., 20 ILCS 3855/1-75(c)(1)(B), (C). The law continues to recognize that “renewable energy resources” may be used to satisfy the

RPS, but focuses this Plan only on the procurement of “renewable energy credits” (which, standing alone, also may constitute “renewable

energy resources”).

Illinois Power Agency 2022 Long-Term Plan (Final) August 23, 2022

and photovoltaic projects;

those quantitative REC delivery targets from “new” projects found in

Section 1-75(c)(1)(C) operated as follows:

By the end of the 2020 delivery year (May 31, 2021):

• At least 2,000,000 renewable energy credits for each delivery year shall come from new wind

projects; and

• At least 2,000,000 renewable energy credits for each delivery year shall come from new

photovoltaic projects.

By the end of the 2025 delivery year (May 31, 2026):

• At least 3,000,000 renewable energy credits for each delivery year shall come from new wind

projects; and

• At least 3,000,000 renewable energy credits for each delivery year shall come from new

photovoltaic projects.

By the end of the 2030 delivery year (May 31, 2031):

• At least 4,000,000 renewable energy credits for each delivery year shall come from new wind

projects; and

• At least 4,000,000 renewable energy credits for each delivery year shall come from new

photovoltaic projects.

For the “new photovoltaic project” requirement, at least 50% needed to be procured from solar

photovoltaic projects using the Adjustable Block Program (used to support distributed generation

and community solar, as discussed further below), at least 40% from utility-scale solar projects, and

at least 2% from non-community solar brownfield site photovoltaic projects.

These concepts still govern RPS compliance under P.A. 102-0662, but with more aggressive goals and

targets. As also discussed later in this Chapter and across Chapter 3, Public Act 102-0662 has now

introduced a “40% by 2030” RPS goal, while targeting the delivery of 45,000,000 RECs from new wind

and new photovoltaic projects by the end of the 2030 delivery year.

2.2.2.4. P.A. 99-0906: Community Renewable Generation

P.A. 99-0906 introduced the concept of a “community renewable generation project” to Illinois law.

As defined by the IPA Act,

this is an electric generating facility that:

(1) is powered by wind, solar thermal energy, photovoltaic cells or panels, biodiesel, crops

and untreated and unadulterated organic waste biomass, tree waste, and hydropower that

does not involve new construction or significant expansion of hydropower dams;

(2) is interconnected at the distribution system level of an electric utility as defined in this

Section, a municipal utility as defined in this Section that owns or operates electric

P.A. 99-0906 introduced the standard of a “new” project as being a project not energized before effective date of that Act (June 1, 2017).

In many cases, that standard still applies to the definition of “new” projects, even after the enactment of P.A. 102-0662.

See 20 ILCS 3855/1-10.

Illinois Power Agency 2022 Long-Term Plan (Final) August 23, 2022

distribution facilities, a public utility as defined in Section 3-105 of the Public Utilities Act, or

an electric cooperative, as defined in Section 3-119 of the Public Utilities Act;

(3) credits the value of electricity generated by the facility to the subscribers of the facility;

and

(4) is limited in nameplate capacity

to less than or equal to 2,000 kilowatts.

A subscriber’s subscription to such a facility is an “interest” in that facility “expressed in kilowatts”

which is sized primarily to offset part or all of the subscriber's electricity usage, and may not

constitute more than 40% of the facility’s nameplate capacity.

Through subscription, the subscriber

receives a bill credit for each kilowatt hour produced by that project commensurate with the

subscriber’s subscription size via net metering, similar to (although not necessarily valued exactly

commensurate with) if that share of project was sited behind the customer’s meter.

Photovoltaic community renewable generating projects are frequently described herein (as well as

in Sections 1-10 and 1-56(b) of the IPA Act) as “community solar” projects, and to ensure that such

projects are developed, community solar projects have distinct minimum REC procurement targets

in the Illinois RPS. Those RECs are procured through proposed community solar projects applying

to the Adjustable Block Program, described below.

While Public Act 99-0906 supported only one category of community solar projects in the Adjustable

Block Program, through Public Act 102-0662, the Adjustable Block Program now supports two separate

categories of community solar projects (more traditional community solar projects—which tend to be

large-scale and transactional—and “community-driven” community solar projects).

2.2.2.5. P.A. 99-0906: The Adjustable Block Program

P.A. 99-0906 required the development and ongoing operation of an “adjustable block program”

(“ABP”). Used to facilitate the development of new community solar and distributed photovoltaic

generation projects, the Adjustable Block Program must feature a “transparent schedule of prices

and quantities” for RECs “to enable the photovoltaic market to scale up and for renewable energy

credit prices to adjust at a predictable rate over time.”

This pricing approach represented a

significant shift in the state’s approach to procuring renewable energy; prior to the enactment of P.A.

99-0906, past efforts to procure renewable energy resources focused on competitive sealed bidding,

pay-as-bid procurement events. Most bidder and supplier information, including resulting contract

prices and quantities for winning bidders, was considered confidential. While these competitive

procurement elements continued to be utilized for other activities under the Illinois RPS, the

Adjustable Block Program provided open application to a program featuring price transparency

utilizing administratively-set REC prices established through this Long-Term Plan approval process.

P.A. 99-0906 provided the following delineation for categories of projects supported under the ABP:

(1) At least 25% from distributed renewable energy generation devices with a nameplate

capacity of no more than 10 kilowatts (“Small DG”);

“Nameplate capacity” is defined in the law as the aggregate inverter nameplate capacity in kilowatts AC. 20 ILCS 3855/1-10.

20 ILCS 3855/1-10.

20 ILCS 3855/1-75(c)(1)(K).

Illinois Power Agency 2022 Long-Term Plan (Final) August 23, 2022

(2) At least 25% from distributed renewable energy generation devices with a nameplate

capacity of more than 10 kilowatts and no more than 2,000 kilowatts (“Large DG”);

(3) At least 25% from photovoltaic community renewable generation projects (“Community

Solar”).

(4) The remaining 25% shall be allocated as specified by the Agency in the long-term renewable

resources procurement plan.

Projects successfully participating in these categories prior to the enactment of P.A. 102-0662

received a 15-year REC delivery contract with a counterparty utility, with that revenue received by

the applicant offsetting the project’s development costs. Under P.A. 99-0906, those contracts all

featured some form of prepayment of the revenues due back to the applicant/Seller: full payment

upon energization in the case of Small DG projects; and 20% upon energization with the remaining

80% paid ratably over the next 4 years in the case of Large DG and community solar projects.

The Illinois RPS post-P.A. 102-0662 maintains the basic structure of the Adjustable Block Program, but

features several modifications to categories (from three project categories to six project categories),

permissible project sizes, and REC delivery contract payment structure and terms. Those changes are

discussed later in this Chapter.

2.2.2.6. P.A. 99-0906: The Illinois Solar for All Program

Similar to the Adjustable Block Program, the Illinois Solar for All (“ILSFA”) Program was established

as a solar incentive program intending to incent low-income, non-profit, and public facility

participation in solar photovoltaic projects—whether as a system owner, community solar project

subscriber, or system host—through revenue provided by REC delivery contracts. Reflecting the

additional incentive necessary to ensure low-income participation, ILSFA REC prices generally

exhibit a premium above those used for the Adjustable Block Program, with the Agency also having

the ability to offer full contract prepayment or otherwise relax (or enhance) requirements in

recognition of the unique challenges facing low-income project development. As introduced under

P.A. 99-0906, funding for the Illinois Solar for All Program came from a combination of funds

collected under Section 16-108(k) collections (i.e., those used to support RPS activities more

generally) and funds in the IPA-administered Renewable Energy Resources Fund. As a result of this

dual funding mechanism, ILSFA REC delivery contracts could feature a counterparty Buyer that was

either an Illinois electric utility or the State of Illinois itself.

As established under P.A. 99-0906, the ILSFA Program featured four subprograms generally matched

to the project or customer type eligible to participate:

• Low-Income Distributed Generation Incentive Program

• Low-income Community Solar Project Initiative

• Non-Profit and Public Facility Incentive Program

• Low-Income Community Solar Pilot Project Program

Unlike the Adjustable Block Program, which operated with block sizes supporting defined quantities

of new installed solar capacity, the Illinois Solar for All Program featured no hard targets or goals for

The Agency may create sub-categories within this category to account for the differences between projects for small commercial

customers, large commercial customers, and public or non-profit customers.

20 ILCS 3855/1-75(c)(1)(K).

Illinois Power Agency 2022 Long-Term Plan (Final) August 23, 2022

the quantity of RECs to be procured. Instead, it operated (and continues to operate) with annual

program year budgets for each subprogram.

Changes to the Illinois Solar for All Program through P.A. 102-0662 include the elimination of one

subprogram and the introduction of another, a significant increase in the annual utility-collected

funding used to support the ILSFA Program, and dedicated participation in select subprograms for

project structures demonstrating “energy sovereignty.”

2.2.2.7. P.A. 99-0906: Competitive Procurements

As referenced above, P.A. 99-0906 maintained elements of the competitive, confidential, “pay-as-bid”

procurement structure for certain RPS implementation activities—specifically, for awarding REC

delivery contracts used to support new utility-scale wind, utility-scale photovoltaic, and brownfield

site photovoltaic projects. Proposed projects qualified through meeting project maturity

requirements, paying required fees, and posting required collateral, and then offered proposed a

proposed quantity and REC price (or “bid”) with the lowest-priced bids selected to meet

predetermined procurement quantities.

P.A. 99-0906 defined projects larger than 2 MW in size as “utility-scale” (this threshold is now 5 MW

under P.A. 102-0662), although economies of scale generally resulted in supported projects being

much larger than that minimum. Quantitative new project targets in the Illinois RPS required that at

least 40% of RECs used to meet new solar photovoltaic targets be derived from utility-scale solar

projects and 2% from brownfield site projects; for new wind project targets, the entirety was to be

sourced from utility-scale projects.

To meet these targets, P.A. 99-0906 required that the IPA conduct “initial forward procurements”

prior to the approval of its Initial Long-Term Renewable Resources Procurement Plan. Those

procurements were intended to bring 1,000,000 RECs each of utility-scale wind and utility-scale solar

under contract, with additional procurements proposed through the IPA’s Long-Term Renewable

Resources Procurement Plan. Proposed projects were subject to locational requirements generally

described in Section 1-75(c)(1)(I) of the Act and outlined in practice through this Plan; under these

requirements, projects in Illinois were eligible and those in adjacent states may be eligible, but only

if certain public interest criteria were satisfied.

Public Act 102-0662 provides a similar structure for supporting utility-scale and brownfield site

photovoltaic projects, with utility-scale project REC procurement events also required to have been

conducted prior to this Plan’s approval (within 240 days of the effective date of P.A. 102-0662) and

additional procurements proposed through this Plan. P.A. 102-0662 also maintains the general

competitive procurement framework previously used to select proposed projects, but with a) the ability

to consider additional factors as part of bid evaluation (such as progress on equity initiatives or project

locational benefits for communities transitioning from closed power plants) and b) REC delivery

contracts featuring an indexed REC pricing structure (a REC price that floats upward or downward

based on assumed energy revenues for the facility).

2.2.3. The Long-Term Renewable Resources Procurement Plan

Public Act 99-0906 required the Illinois Power Agency to outline a new procurement plan – the Long-

Term Renewables Procurement Plan – containing proposals for implementing these new programs

and procurements, and for the management of these increased funds for meeting more aggressive

Illinois Power Agency 2022 Long-Term Plan (Final) August 23, 2022

RPS targets and goals. This separate, renewable energy-focused planning process was a departure

from past practice under the Illinois RPS; previously, Illinois law required that renewable energy

resource procurements used to meet the requirements of Section 1-75(c) of the IPA Act be proposed

through the Agency’s annual procurement plan developed pursuant to Section 16-111.5 of the PUA.

The Long-Term Renewable Resources Procurement Plan—prepared pursuant to Section 16-

111.5(b)(5) of the PUA—was initially prepared in 2017, was approved by the ICC in 2018, was

required to be revised at least every two years, and “shall include procurement programs and

competitive procurement events necessary to meet the goals” set forth in Section 1-75(c) of the IPA

Act. That original Long-Term Renewable Resources Procurement Plan or “Initial Plan” was

developed over the summer of 2017, published for comment on September 29, 2017, filed with the

Illinois Commerce Commission for approval on December 4, 2017, and approved by the Commission

on April 3, 2018 through ICC Docket No. 17-0838. As that plan is required by law to be updated at

least every two years, a First Revised Long-Term Renewable Resources Procurement Plan was

approved by the Commission on February 18, 2020 through Docket No. 19-0995. The Agency

published its draft Second Revised Long-Term Plan on August 16, 2021 but withdrew the draft in

accordance with the passage of Public Act 102-0662 as required by that Act’s revisions to Section 1-

75(c)(1)(A) of the IPA Act. Under those same revisions, this Plan was required to be published within

120 days of the effective date of P.A. 102-0662 (by January 13, 2022), was filed with the Illinois

Commerce Commission on March 21, 2022, and was approved by the Commission through Docket

No. 22-0231 on July 14, 2022. Updates to the Long-Term Plan will continue on a biannual basis.

2.3. RPS Implementation: 2017-2021

The IPA conducted a variety of program and procurement activities under the structure required by

P.A. 99-0906; this Section serves to outline certain successes and challenges observed from RPS

implementation under that RPS structure, as those successes and challenges informed many of the

statutory changes found in Public Act 102-0662 which serve to shape this Plan.

2.3.1. Successes and Challenges

For successes, Section 1-75(c)(1)(C) introduced quantitative new photovoltaic project and new wind

project targets into Illinois law; those targets were 2,000,000 RECs delivered annually from each

category by 2020, 3,000,000 RECs delivered annually from each category by 2025, and 4,000,000

RECs delivered annually by 2030. For photovoltaic projects, 50% of the photovoltaic project total

was required to be sourced from Adjustable Block Program projects, with 40% from utility-scale

projects and 2% from brownfield site photovoltaic projects.

Those new project targets were somewhat easily met. The “first phase” of the Adjustable Block

Program concluded by late 2020 with all three project categories having been filled, and thus

accepted project applications met or exceeded the quantities required to meet that 2020 delivery

year target of 1,000,000 RECs delivered annually. Through procurements conducted by the

conclusion of calendar year 2019, RECs under contract from utility-scale photovoltaic projects

exceeded 2025 and 2030 targets, while those from utility-scale wind and brownfield site photovoltaic

projects exceeded 2020 targets.

Changes to the Illinois RPS from P.A. 99-0906 resulted in an unprecedented wave of new renewable

energy development in Illinois—and, specifically, new solar development. Prior to P.A. 99-0906’s

enactment, Illinois was estimated to have approximately 70-80 MW of photovoltaic projects installed

Illinois Power Agency 2022 Long-Term Plan (Final) August 23, 2022

statewide. The Adjustable Block Program alone has now supported nearly 700 MW of new solar

distributed generation and community solar, with over 20,000 Illinois residents and businesses

availing themselves of the support provided by this program. Competitive procurements have

supported another over 1300 MW of new utility-scale solar projects, and nearly 700 MW of new

utility-scale wind. All but one project has been located in Illinois itself, ensuring that economic

development, energy diversification, and certain environmental benefits generally connect back to

those Illinois residents and businesses who financially support these initiatives. The Illinois Solar for

All Program has observed robust participation in three of the four subprograms provided for by P.A.

99-0906.

These successes have not come without significant challenges. As outlined in Chapter 3, even with

thousands of megawatts of additional new solar and wind project development, Illinois remains well

short of the “25% by 2025” trajectory envisioned through P.A. 99-0906’s revised RPS. Meeting 25%

of retail sales through REC procurements requires approximately 30 million RECs to be delivered

annually; doing so through RECs from new projects (especially with a large portion of new

distributed generation and community solar projects) would require a significantly larger RPS

budget than what was authorized through P.A. 99-0906. The IPA also held two utility-scale wind

procurements in 2019 and 2021 that featured no winning bidders, with post-procurement comments

from potential participants seeking modification to the fixed-price REC procurement structure

traditionally used in IPA procurements.

In late 2020, the Agency also released a revised RPS budget analysis indicating that project

development delays caused by COVID-19, combined with the front-loaded contract payment

structure present in ABP contracts and the inability to roll prior collections forward to meet future

years’ expenses under Section 16-108(k) of the PUA, would not only freeze additional program and

procurement activity, but also place projects already in receipt of REC delivery contracts at risk of

reduced payments. As structured under P.A. 99-0906, the Illinois RPS would eventually stimulate

additional renewable energy project development, but only in fits and starts and only after prior REC

delivery contract obligations were fully satisfied.

Additional concerns were raised regarding the significant gulf between Adjustable Block Program

REC prices and those resultant from competitive procurement events used to support new utility-

scale project development, as well as the lack of progress in meeting percentage-based RPS goals.

Through Resolution No. 153, the Illinois Legislative Audit Commission directed the Auditor General

to “conduct a performance audit of the Illinois renewable portfolio standard and the Illinois Power

Agency’s management of the Renewable Energy Credit procurement process and Adjustable Block

Grant Program.” The Auditor General’s Office’s report was published on May 11, 2021, and concluded

with one recommendation, with which the Agency agreed:

The Illinois Power Agency should continue to work to meet the renewable energy

percentage-based procurement goals required by 20 ILCS 3855/1-75(c)(1)(B).

The Agency had proposed a procurement strategy in its Initial Long-Term Plan to attempt to meet

the percentage-based procurement goals of Section 1-75(c)(1)(B) of the IPA Act through year-over-

year “spot procurements” intended to procure RECs from built and existing projects that qualified

for the Illinois RPS. That procurement approach was rejected by the Commission in Docket No. 17-

The full Auditor General’s report can be found here: https://www.auditor.illinois.gov/Audit-Reports/Performance-Special-

Multi/Performance-Audits/2021_Releases/21-IPA-Future-Energy-Jobs-Act-Perf-Full.pdf.

Illinois Power Agency 2022 Long-Term Plan (Final) August 23, 2022

0838, with instruction that any available budget instead be focused on procurements intended to

facilitate the development of new projects. So long as the development of new projects was

prioritized over technical percentage-based RPS compliance – and thus REC prices reflected the

incentive needed to facilitate new project development, and not the price of RECs sold in liquid

markets from already-built and financed renewable energy projects – existing RPS budgets would

always remain insufficient for meeting a “25% by 2025” requirement.

In addition to these quantitative REC procurement and RPS budget concerns, critiques were also put

forward regarding qualitative aspects of how the clean energy economy developed in Illinois. While

the opening of the Adjustable Block Program facilitated many times more community solar project

applications than could be supported through the Program – which itself resulted in challenges

through utilization of a random selection process for project selection, and the disconnect between

that project selection process and priority in utility interconnection queues – community solar

projects were generally large and transactional, built to maximum size in agrarian areas to leverage

low land costs and economies of scale. This was not the more localized, community-driven model

that some advocates had envisioned. Labor interests voiced concern about whether fair wages were

paid to those employed to meet the growing number of solar installations located in the state.

Perhaps most importantly, advocates and others shared repeated concerns over whether

implementation of the RPS under P.A. 99-0906 created an equitable distribution of the benefits of the

growing clean energy economy, especially regarding those employed in project development work.

While P.A. 99-0906 contained open-ended qualitative statements and legislative findings about

ensuring the equitable distribution of benefits from Illinois’s clean energy economy, actual program

and project qualification requirements (outside of the low income-focused Illinois Solar for All

Program) focused more on ensuring that the Illinois RPS resulted in new project development—and

not on where within the state those projects were developed, who was employed to work on those

projects, and who ultimately received benefits from those projects. Without firm requirements in

place, loose qualitative and directional statements proved insufficient for driving desired outcomes.

The approach taken through P.A. 99-0906 to RPS implementation was nonetheless a meaningful shift

in the state’s renewable energy requirements: prior to 2017, the state’s approach could have been

understood as governed by the logic that statutory RPS compliance should be achieved at “the lowest

total cost over time, taking into account any benefits of price stability,”

as these criteria governed

the Agency’s annual procurement plan. The Illinois RPS as modified by P.A. 99-0906 thus

represented a significant step forward because it drove large volumes of new renewable energy

project development. But, to many, another step was needed to ensure that state-administered funds

used to support new renewable energy project development were leveraged in a more targeted,

socially-beneficial manner.

2.3.2. Legislative Proposals

Dating back to 2019, multiple bills were introduced that sought to address these and other

challenges. Significant energy bills introduced included the following:

◼ HB 804/SB 1718 (the “Clean Energy Jobs Act”)

See 220 ILCS 5/16-111.5(d)(4).

The content of these proposals is not reviewed here, but copies of proposed legislation can be found on the Illinois General Assembly’s

website (www.ilga.gov).

Illinois Power Agency 2022 Long-Term Plan (Final) August 23, 2022

◼ HB 1734/SB 311 (the “Downstate Energy Affordability Act”)

◼ HB 2640/SB 1601 (the “Path to 100 Act”)

◼ HB 3446/SB 529 (the “Coal to Solar and Energy Storage Act”)

◼ HB 1472/SB 1100 (the “Climate Union Jobs Act”)

◼ HB 4074/SB 2896 (the “Consumers and Climate First Act”)

While the Illinois General Assembly convened only intermittently in 2020 after the COVID-19

pandemic emerged, Senate-organized working groups met across the spring of 2020 and were

followed by working groups organized by the Governor’s Office across the summer and fall of 2020.

Additional House and Senate legislative working groups were convened across April and May of

2021, with interested stakeholders working diligently toward compromise legislation borrowing

elements from each of the above-listed bills. Drafts of omnibus energy bills incorporating elements

of these and other proposals were produced by legislative staff across the final week of the General

Assembly’s Spring 2021 session. That session concluded on May 31, 2021 without meaningful

legislative advancement, despite significant progress in negotiations.

Additional negotiations occurred across the summer of 2021, culminating in the introduction and

passage of amended Senate Bill 2408 by the Illinois House on September 9, 2021 and the Illinois

Senate on September 13, 2021. This bill, known colloquially as the Climate and Equitable Jobs Act,

was signed into law by Illinois Governor J.B. Pritzker on September 15, 2021 (establishing its effective

date, which then informs many deadlines stemming from the legislation) as Public Act 102-0662.

2.4. Public Act 102-0662: The Climate and Equitable Jobs Act

Public Act 102-0662 constitutes a significant reshaping of energy law in Illinois—and not only with

respect to the Illinois RPS. In addition to the revisions discussed within this Plan, P.A. 102-0662 also

creates a policy target for the State of Illinois of 100% clean energy by 2050; offers a decarbonization

schedule for the closure of fossil-based electric generating facilities; introduces additional support

for at-risk nuclear plants through the procurement of carbon mitigation credits; provides financial

support for communities faced with generating facility closures; establishes significant financial

support for the clean energy workforce; establishes beneficial electrification, electric vehicle, and

energy storage initiatives; contains numerous ethics and ratemaking reforms applicable to Illinois

electric utilities; and addresses a litany of other issues too numerous to recount here.

With respect to the Illinois RPS and those activities governed by and proposed through this Plan,

changes found in Public Act 102-0662 generally take three forms. The first is volume: through

changes to Section 1-75(c)(1)(E), annual collections under the Illinois RPS are projected to total over

$580 million, versus the ~$230 million previously collected. Through changes to Section 16-108(k)

of the Public Utilities Act, prior years’ collections can now be rolled over to meet future years’

expenses, allowing for more budget to be leveraged than under P.A. 99-0906’s structure. Utility

collections used to support the Illinois Solar for All Program grow from ~$11 million annually to up

to $50 million annually.

Those volumetric changes can also be found in the REC procurement goals and targets in Section 1-

75(c)(1)(B) and (C) of the Act. Section 1-75(c)(1)(B)’s prior “25% by 2025” RPS standard has been

replaced by more aggressive “40% by 2030” and “50% by 2040” requirements. Section 1-

75(c)(1)(C)’s prior targets of 8,000,000 RECs delivered annually from new projects by 2030 is now

an ambitious 45,000,000 REC procurement target. The scale of the Illinois RPS has grown

considerably through P.A. 102-0662.

Illinois Power Agency 2022 Long-Term Plan (Final) August 23, 2022

A second category of changes are qualitative changes, through which existing activities already

conducted under P.A. 99-0906’s structure will continue, but with qualitative considerations offering

a different form to or process for that work. One key example of this is the Adjustable Block Program:

that program previously featured three categories of projects (Small DG, Large DG, and Community

solar), but changes to Section 1-75(c)(1)(K) now transition the ABP to six categories (with the

addition of Public Schools, Community-Driven Community Solar, and Equitable Eligible Contractor

categories), demonstrating more attention paid to the qualitative attributes of projects supported by

or applicants to the program. Given its role in establishing requirements for funding eligibility, the

IPA had previously exercised consumer protection oversight for solar transactions in Illinois

benefitting from state-administered incentive funding; that consumer protection role is now

memorialized and expanded through changes to Section 1-75(c)(1)(M) of the Act.

New labor requirements also fit this description. Under Section 1-75(c)(7), P.A. 99-0906 required all

new photovoltaic projects and distributed generation projects to be installed by “qualified persons.”

As modified by P.A. 102-0662, that “qualified person” requirement remains, but is now accompanied

by Section 1-75(c)(1)(Q)’s prevailing wage requirements for most new Adjustable Block Program

projects and both prevailing wage and project-labor agreement requirements for new utility-scale

and brownfield site photovoltaic projects.

The largest qualitative changes concern new diversity, equity, and inclusion requirements. P.A. 99-

0906 provided aspirational statements, such as that RPS programs and procurements “shall provide

employment opportunities for all segments of the population and workforce, including minority-

owned and female-owned business enterprises.”

P.A. 102-0662 distills those aspirational

statements down to specific requirements of participants: new Section 1-75(c-10) of the Act

establishes minimum equity standards under which “at least 10% of the project workforce for each

entity participating . . . must be done by [sic] equity eligible persons or equity eligible contractors.”

That percentage rises to 30% by 2030 under a schedule established by the Agency. For competitive

procurements, Section 1-75(c-10)(3) requires that “the Agency shall develop bid application

requirements and a bid evaluation methodology for ensuring that utilization of equity eligible

contractors . . . is optimized,” constituting a potentially significant shift from evaluating qualified bids

based only on price. Other new diversity, equity, and inclusion provisions require compliance

reporting by Approved Vendors, Agency diversity reporting, and the development of a disparity

study.

A third category of changes is scope; P.A. 102-0662 authorizes new activities that the Agency had not

previously conducted. Of these, two are particularly noteworthy. First, the IPA is directed to conduct

a pair of procurements pursuant to new Section 1-75(c-5) of the Act intended to support the

development of new utility-scale photovoltaic projects coupled with storage “at or adjacent to the

sites of electric generating facilities that burn or burned coal as their primary fuel source.” These

“coal to solar” procurements operate with statutorily established REC prices, maximum procurement

quantities, project location requirements, and REC delivery timelines—thus functioning more akin

to an application process than open-ended competitive procurements traditionally undertaken by

the Agency. While these “coal-to-solar” procurements are not proposed through this Plan (with the

first undertaken during this Plan’s consideration), and the mechanism for funding payments under

this contract is distinct from that which funds general RPS activities, RECs procured by counterparty

20 ILCS 3855/1-75(c)(7).

Illinois Power Agency 2022 Long-Term Plan (Final) August 23, 2022

utilities under these coal-to-solar procurements “may be included or counted for purposes of

compliance with the amounts of renewable energy credits required to be procured pursuant to

subsection (c) of this Section to the extent that there are otherwise shortfalls in compliance with such

requirements.”

Second, new Section 1-75(c)(1)(R) of the Act requires that the Agency “establish a self-direct

renewable portfolio standard compliance program for eligible self-direct customers that purchase

renewable energy credits from utility-scale wind and solar projects through long-term agreements

for purchase of renewable energy credits.” Under this self-direct program, by virtue of entering into

qualifying long-term agreements for the purchase of RECs from new utility-scale wind or solar

projects, select customers become eligible for a credit back for certain bill charges levied to support

the Illinois RPS pursuant to Section 16-108(k) of the PUA. While this self-direct program bears some

similarity with Section 16-115D of the PUA’s previous RPS compliance regime for alternative retail

electric suppliers, ARES compliance within that regime was overseen by the ICC rather than the IPA

and ultimately sunset through P.A. 99-0906’s changes to Section 16-115D.

This is just an exemplary overview of changes brought on by Public Act 102-0662, and new

requirements are discussed in more detail through the Chapters ahead. As with prior Long-Term

Plans, the following sections of this Chapter 2 provide an overview of specific legal requirements

applicable to this Plan, with updates in content and new sections offered to reflect changes present

in P.A. 102-0662.

2.5. Long-Term Renewable Resources Procurement Plan

As outlined above, Illinois law requires that the IPA develop a Long-Term Renewable Resources

Procurement Plan to guide implementation of its renewable energy programs and procurements.

The Initial Plan was approved by the Commission on April 3, 2018 through Docket No. 17-0838 and

a First Revised Long-Term Renewable Resources Procurement Plan was approved by the

Commission on February 18, 2020 through Docket No. 19-0995. This 2022 Long-Term Plan has been

prepared, published, and filed pursuant to Section 1-75(c)(1)(A) of the IPA Act, as modified by Public

Act 102-0662, and Section 16-111.5(b)(5) of the PUA, and was approved by the Illinois Commerce

Commission through Docket No. 22-0231 on July 14, 2022.

2.5.1. Plan Requirements

While Illinois law lacks any single list of required elements for the Plan, both Section 16-111.5(b) of

the PUA and Sections 1-56 and 1-75 of the IPA Act contain discrete requirements for various elements

of this Plan.

2.5.1.1. Section 16-111.5(b) Requirements

Section 16-111.5(b)(5) of the PUA provides that “[t]he Agency shall prepare a long-term renewable

resources procurement plan for the procurement of renewable energy credits under Sections 1-56

and 1-75 of the Illinois Power Agency Act for delivery beginning in the 2017 delivery year,”

with

“delivery year” defined as “the consecutive 12-month period beginning June 1 of a given year and

20 ILCS 3855/1-75(c-5)(1).

220 ILCS 5/16-111.5(b)(5).

Illinois Power Agency 2022 Long-Term Plan (Final) August 23, 2022

ending May 31 of the following year.”

The PUA also contains certain discrete requirements for what

the Plan must contain or what the Commission must approve.

First, the Plan must “[i]dentify the procurement programs and competitive procurement events

consistent with the applicable requirements of the Illinois Power Agency Act and shall be designed

to achieve the goals set forth in subsection (c) of Section 1-75 of that Act.”

While the term

“competitive procurement event” is not defined in either the IPA Act or the PUA, the IPA understands

the term “competitive procurement event” to be an element of, if not commensurate with, a

“competitive procurement process” or “competitive bid process,” which the PUA describes as subject

to the requirements of Section 16-111.5(e)-(i) where applicable (i.e., conducted in a manner

consistent with the Agency’s prior competitive procurements).

The term “program” presumably

refers to the programs specifically referenced in Section 1-56(b) and Sections 1-75(c)(1)(K) and (N)

of the IPA Act. This Plan’s specific procurement programs and procurement events designed to meet

the goals of Section 1-75(c) can be found in Chapters 4 through 10.

Second, the Plan must “[i]nclude a schedule for procurements for renewable energy credits from

utility-scale wind projects, utility-scale solar projects, and brownfield site photovoltaic projects

consistent with subparagraph (G) of paragraph (1) of subsection (c) of Section 1-75 of the Illinois

Power Agency Act.”

This subparagraph concerns the quantitative procurement targets for RECs

from new solar and wind facilities found in Section 1-75(c), and the schedule for those procurements

can be found in Chapter 5.

Third, the Plan must “[i]dentify the process whereby the Agency will submit to the Commission for

review and approval the proposed contracts to implement the programs required by such plan.”

Both REC delivery contracts and the IPA’s program administrator contracts

must be approved by

the Commission prior to execution.

The IPA’s process for submitting contracts to the Commission

for review and approval can be found in Chapters 7 and 8 of the Plan; it does not meaningfully differ

from that which was proposed in the Initial Plan and First Revised Plan. As this requirement concerns

only “the programs required by such plan,” this requirement does not impact the contract

development process for the competitive procurements described in Chapter 5, although

Commission approval is also required prior to the execution of contracts for competitive

procurements under the process described in Section 16-111.5(e)-(i).

Through changes enacted through P.A. 102-0662, Section 16-111.5(b)(5)(ii)(D) also now requires

that the Commission “approve or modify the Agency's proposal for minimum equity standards”

developed pursuant to Section 1-75(c-10) of the IPA Act, and “consider any analysis performed by

20 ILCS 3855/1-10.

220 ILCS 5/16-111.5(b)(5)(ii)(B)(aa).

220 ILCS 5/16-111.5(b)(5)(iii).

220 ILCS 5/16-111.5(b)(5)(ii)(B)(bb).

220 ILCS 5/16-111.5(b)(5)(ii)(B)(cc).

For the Agency’s third-party program administrators, Section 16-111.5(b)(5)(iii) provides that “[t]hird parties shall not begin

implementing any programs or receive any payment under this Section until the Commission has approved the contract or contracts under

the process authorized by the Commission in item (D) of subparagraph (ii) of paragraph (5) of this subsection (b) and the third party and

the Agency or utility, as applicable, have executed the contract.”

In its Order approving the Initial Plan, the Commission held that under Section 16-111.5(b)(5)(iii)’s requirements, “it must review the

individual [REC delivery] contracts between the utilities and Approved Vendors and “not just a master contract, although “a master

contract that is updated by a confirmation agreement providing the batch details regarding seller, buyer, price, term, project location, etc.

is a reasonable approach.” Docket No. 17-0838, Final Order dated April 3, 2018 at 116.

Illinois Power Agency 2022 Long-Term Plan (Final) August 23, 2022

the Agency in developing its proposal, including past performance, availability of equity eligible

contractors, and availability of equity eligible persons at the time the long-term renewable resources

procurement plan is approved.” The Agency’s proposed approach to minimum equity standards and

Section 1-75(c-10) implementation can be found in Chapter 10.

2.5.1.2. Section 1-75 Requirements

Section 1-75 of the IPA Act contains the most robust set of requirements for the long-term plan; those

include the following:

First, the Plan must “attempt to meet the goals for procurement of renewable energy credits to meet

at least the following overall percentages: 13% by the 2017 delivery year; increasing by at least 1.5%

each delivery year thereafter to at least 25% by the 2025 delivery year; increasing by at least 3%

each delivery year thereafter to at least 40% by the 2030 delivery year, and continuing at no less than

40% for each delivery year thereafter” with an additional goal of 50% by delivery year 2040.”

These

percentages are described as a portion of each utility’s “load for all retail customers,” which includes

load served by alternative retail electric suppliers. The law also provides that “in the event of a

conflict between these goals and the new wind and new photovoltaic procurement requirements

…the long-term plan shall prioritize compliance with the new wind and new photovoltaic

procurement requirements described in items (i) through (iii) of subparagraph (C) of this paragraph

(1) over the annual percentage targets described in this subparagraph (B).”

In Docket No. 17-0838, the Commission’s Order approving the Initial Plan determined that any

procurements originally proposed to meet annual percentage-based renewable energy credit

procurement goals should be cancelled to avoid any potential conflicts with meeting “statutory long-

term new build requirements.”

Public Act 102-0662 appears to have memorialized that

Commission directive, with Section 1-75(c)(1)(B) now instructing that “[t]he Agency shall not

comply with the annual percentage targets described in this subparagraph (B) by procuring

renewable energy credits that are unlikely to lead to the development of new renewable resources.”

This new language would appear to bar the Agency from proposing RPS procurement approaches

like the IPA’s prior-proposed “spot procurements,” which sought to fill RPS compliance gaps through

one-year contracts for the delivery of RECs from existing projects. Further discussion about progress

toward these RPS goals is covered in Chapter 3, and application of this new statutory provision in

prohibiting program participation from photovoltaic systems energized after June 1, 2017 whose

development had previously been supported through IPA-administered REC delivery contracts can

be found in Chapter 7.

Second, the Plan “shall include the procurement of renewable energy credits in amounts equal to at

least” the new wind and new photovoltaics targets found in Section 1-75(c)(1)(C) of the IPA Act.

These targets are 10,000,000 RECs delivered annually by the end of the 2021 delivery year,

increasing ratably to reach 45,000,000 RECs delivered annually by the end of the 2030 delivery year.

Of that amount, the Agency shall attempt to procure “45% from wind projects and 55% from

photovoltaic projects.”

20 ILCS 3855/1-75(c)(1)(B).

Id.

Docket No. 17-0838, Final Order dated April 3, 2018 at 42.

Illinois Power Agency 2022 Long-Term Plan (Final) August 23, 2022

Within the category of “new photovoltaic projects,” 50% of photovoltaic RECs are to be procured

through the Adjustable Block Program (and thus from distributed generation or community solar

projects), 47% from utility-scale (above 5 MW) photovoltaic projects, 3% from brownfield site

photovoltaic projects that are not community renewable generation projects. To ensure success in

meeting this brownfield site photovoltaic procurement requirement, Section 1-75(c)(1)(C)(i) also

now directs the Long-Term Plan to “consider other approaches, in addition to competitive

procurements, that can be used to procure renewable energy credits from brownfield site

photovoltaic projects.” Further discussion of these quantitative new build targets, including a

discussion of progress made toward meeting these targets to date, can be found in Chapter 3, while

the IPA’s approach to brownfield site photovoltaic procurements can be found in Chapter 5.

Third, the law requires that, to the extent that annual RPS spending budgets

for each utility become

a binding constraint, the Plan “shall prioritize compliance with the requirements of this subsection

features the following priority ranking:

(i) renewable energy credits under existing contractual obligations as of June 1, 2021;

(ii) funding for the Illinois Solar for All Program as described in Section 1-75(c)(1)(O);

(iii) renewable energy credits necessary to comply with the new wind and new photovoltaic

procurement requirements in Section 1-75(c)(1)(C); and

(iv) renewable energy credits necessary to meet the remaining requirements of Section 1-

75(c) (including the percentage-based delivery year goals in Section 1-75(c)(1)(B)).

This statutory language and related considerations were placed at issue in the Reopening of Docket

No. 19-0995, the proceeding for Commission approval of the Revised Long-Term Plan. Through the

IPA’s March 3, 2021 Petition to Reopen, the Agency sought for the Commission to approve a regime

under which REC delivery contract payments would possibly be subject to deferral should expenses

exceed collections for an upcoming delivery year, as the IPA then expected this would be the case for

two of the three utilities in the 2021-22 delivery year. Relying in part on Section 1-75(c)(1)(F), the

IPA argued that REC delivery contracts pre-dating Public Act 99-0906’s passage and Illinois Solar for

All contracts should be exempted from any payment deferrals, as those contracts feature statutory

priority. In its May 27, 2021 Order on Reopening, the Commission agreed.

The IPA is very optimistic that through changes found in Section 16-108(k) of the PUA and Section 1-

75(c)(1)(E) of the IPA Act this prioritization becomes a less acute concern in future years.

Specifically, the changes to these sections of the PUA and IPA Act under P.A. 102-0662 allow for prior

years’ collections to meet future years expenses on a first-in, first-out basis across a five-year period

and more than double the size of the budget available to support RPS activities. However, as separate

language in Section 1-75(c)(1)(C)(ii) of the Act directs the IPA to “continue to procure renewable

energy credits until that budget is exhausted” even if goals and targets are met, the statutory directive

from Public Act 102-0662 appears to be to maximize RPS expenses to the greatest extent possible.

The statutory cost cap and resulting budgets for RPS spending, directed in Section 1-75(c)(1)(E) of the Act, are discussed in more detail

in Chapter 3 of this 2022 Long-Term Plan.

20 ILCS 3855/1-75(c)(1)(F).

See Docket No. 19-0995, Order on Reopening dated May 27, 2021 at 26-28.

Illinois Power Agency 2022 Long-Term Plan (Final) August 23, 2022

The Agency’s approach to establishing what budgets are available for upcoming delivery years and

how those budget projections inform procurement quantities can be found in Chapter 3.

Fourth, the law requires that renewable energy credits procured under the Initial Forward

Procurements

shall be included in the Agency's long-term plan and shall apply to Section 1-75(c)’s

goals.

While not so expressly stated in the law, the Agency assumes that RECs procured under

activities envisioned under Section 1-75(c)(1)(G)(iii) (Subsequent Forward Procurements within

240 days of the effective date of P.A. 102-0662) and (iv) (ABP reopening within 90 days of the

effective date of P.A. 102-0662) are likewise required to be included in this Plan’s accounting of

progress toward RPS goals and targets. The results of the Initial Forward Procurements, conducted

in three events from August 2017 through April 2018, are reflected in the Agency’s target

procurement quantities found in Chapter 3 of this 2022 Long-Term Plan; the Agency has updated

Chapter 3’s tables related to RECs under contract for Adjustable Block Program reopening and

subsequent forward procurements as that data is now available.

Fifth, in transitioning to the new Indexed REC price structure for competitive procurements – under

which REC prices rise as assumed energy revenues fall through a reduction in wholesale energy

prices, and vice versa – Section 1-75(c)(1)(G)(v)(4) allows for the Agency to “consider the institution

of a price collar on REC prices paid under indexed renewable energy credit procurements

establishing floor and ceiling REC prices applicable to indexed REC contract prices.” Any proposed

Indexed REC price collars are required to be filed by the Agency within its Long-Term Plan; this issue

is discussed further in Chapter 5.

Sixth, the Plan must describe in detail how each “public interest factor” enumerated in Section 1-

75(c)(1)(I) “shall be considered and weighted for facilities located in states adjacent to Illinois” in

determining whether those facilities’ RECs may be considered “eligible” to satisfy the Illinois RPS.

The Agency’s approach for applying these criteria can be found in Chapter 4; while generally similar

to the content published in prior plans, Chapter 4 also addresses new statutory language related to

qualifying RECs associated with electricity transmitted to high-voltage direct current converter

stations introduced through Public Act 102-0662.

Seventh, pursuant to Section 1-75(c)(1)(J), the Plan shall provide that renewable energy credits

previously purchased from generating systems previously understood not to be rate-based for a

state-regulated entity, but which end up being so rate-based, shall be made up through a

procurement conducted in the Agency’s next procurement event and funded through amounts

returned under the terms of the REC delivery contract. This connects back to a statutory requirement

that “renewable energy credits shall not be eligible to be counted toward” RPS targets “if they are

sourced from a generating unit whose costs were being recovered through rates regulated by this

State or any other state or states on or after January 1, 2017.”

It appears that this could be

accomplished through an adjustment in procurement volumes for subsequent procurement events,

and the IPA commits to make any such adjustments. To date, the IPA is unaware of any instances for

The Initial Forward Procurements are those conducted under Section 1-75(c)(1)(G)(i) and (ii) of the IPA Act.

20 ILCS 3855/1-75(c)(1)(G)(i)-(ii).

20 ILCS 3855/1-75(c)(1)(J).

Illinois Power Agency 2022 Long-Term Plan (Final) August 23, 2022

which this provision (which is reflected in all program and procurement contracts) has needed to be

enforced.

Eighth, the Plan “shall include an Adjustable Block program for the procurement of renewable energy

credits from new photovoltaic projects that are distributed renewable energy generation devices or

new photovoltaic community renewable generation projects.”

A detailed description of the

Agency’s Adjustable Block Program can be found in Chapter 7. That Program now features six project

categories rather than three, with a transition to an annual block structure also required by P.A. 102-

0662’s changes. Statutory text establishing each of the new project categories also provides discrete

requirements for Plan content:

• For the Public Schools category, the “proposed quantities or blocks, pricing, and contract

terms” are to be included along with “the renewable energy credit price” and “payment

terms,” with those terms designed to “make it feasible and affordable for public schools to

install photovoltaic distributed renewable energy devices.”

• For the community-driven community solar project category, “the Agency shall develop

selection criteria for projects participating in this category” and define “terms and guidance”

for this selection criteria through the Plan.

• For the Equity Eligible Contractor category, the capital advancement structure (through

which applicant projects may receive payment for anticipated REC delivery revenues

predating project energization), including “[t]he amount or percentage of advanced capital”

and how that advancement structure is informed by an applicant’s demonstration of need, is

to be established through the Plan.

Ninth, pursuant to Section 1-75(c)(1)(M) of the Act, the Long-Term Plan shall also include “the

Adjustable Block program terms, conditions, and requirements, including the prices to be paid for

renewable energy credits, where applicable, and requirements applicable to participating entities

and project applications.” These “terms, conditions, and requirements” must also now include a

robust new statutory list of consumer protection requirements—although many of these

requirements mirror the approach that the Agency has taken to program implementation since the

Adjustable Block Program’s initial development. The Agency’s approach for implementing these

consumer protection requirements can be found in Chapter 9.

Tenth, under Section 1-75(c)(1)(N), the Plan “may consider whether community renewable

generation projects utilizing technologies other than photovoltaics should be supported through

State-administered incentive funding, and may issue requests for information to gauge market

demand.” The Agency’s prior efforts in this regard demonstrated scant interest in non-solar

community renewable generation project development (at least without significantly higher REC

prices),

but with statutory changes to the definition of community renewable generation projects

found in Section 1-10 of the IPA Act raising the minimum size of participating projects from 2 MW to

5 MW, the Agency is curious whether this change could spark renewed interest. Additional

discussion can be found in Chapter 7.

The Agency understands that P.A. 102-0662’s edits to Section 1-75(c)(1)(J) concerning HVDC converter stations are merely clarifying

edits, and not intended to create any exception to this subparagraph’s prohibition against utilizing RECs from rate-based projects.

20 ILCS 3855/1-75(c)(1)(K).

More information about the community renewable generation procurement can be found here: https://www.ipa-

energyrfp.com/2019-community-renewable-generation-program-forward-procurement-aic-and-comed.

Illinois Power Agency 2022 Long-Term Plan (Final) August 23, 2022

Eleventh, the Long-Term Plan must define “procedures established by the Agency” through which

project labor agreements, now required for new utility-scale wind and solar and brownfield site

photovoltaic projects participating in IPA procurements pursuant to Section 1-75(c)(1)(Q)(2) of the

Act, “shall be filed with the Director.”

This project labor agreement requirement is described in

more detail within Chapter 5 discussing competitive procurements.

Twelfth, through new Section 1-75(c)(1)(R) of the Act, the Agency must now “establish a self-direct

renewable portfolio standard compliance program for eligible self-direct customers that purchase

renewable energy credits from utility-scale wind and solar projects through long-term agreements

for purchase of renewable energy credits” through its Long-Term Plan. As the establishment of an

entirely new program requires the development of significant amount of new Plan content, the

Agency has devoted an entire chapter to this new large customer RPS self-direct program; that

content can be found in Chapter 6. Under that Chapter’s schedule, applications for this new self-

direct program are scheduled to be taken across early 2023 with program participation formally

beginning for accepted applicants on June 1, 2023.

Lastly, and certainly not least, many of the Agency’s new diversity, equity, and inclusion requirements

are statutorily required to be addressed through the Agency’s Long-Term Plan. These include the

“schedule of percentage increases to the minimum equity standards” to increase those standards

from 10% to 30%, and “requirements for ensuring that competitive procurement processes,

including utility-scale solar, utility-scale wind, and brownfield site photovoltaic projects” advance

equity goals, including through “bid application requirements” and “bid evaluation methodology” in

competitive procurements.

Under Section 1-75(c-10), the Agency’s next revised Long-Term Plan

will also require significant new data reporting and potentially revisions to its equity accountability

system.

The Agency’s approach for implementing numerous other requirements found in Section 1-75 of the

IPA Act must also be included in the Long-Term Plan by implication.

2.5.1.3. Illinois Solar for All Requirements

As discussed further below, in recognition that “the State should encourage . . . investment in

renewable energy resources, including, but not limited to, photovoltaic distributed generation, which

should benefit all citizens of the State, including low-income households,” Section 1-56 of the IPA Act

required the creation of “the Illinois Solar for All Program, which provides incentives for low-income

distributed generation and community solar projects [. . .] to bring photovoltaics to low-income

communities in this State.”

In so doing, the Agency must “include a description of its proposed

approach to the design, administration, implementation and evaluation of the Illinois Solar for All

Program” in the Plan and “propose the Illinois Solar for All Program terms, conditions, and

requirements,”

including REC prices (which may be through a formula).

20 ILCS 3855/-175(c)(1)(Q)(2).

See 20 ILCS 3855/1-75(c)(1)(R).

20 ILCS 3855/1-75(c-10).

20 ILCS 3855/1-56(b)(2).

20 ILCS 3855/1-56(b)(4).

Illinois Power Agency 2022 Long-Term Plan (Final) August 23, 2022

The Illinois Solar for All Program began accepting project applications on May 15, 2019. A more

comprehensive description of the Agency’s Illinois Solar for All Program, including any revisions

made thereto, can be found in Chapter 8.

In addition to describing what the Illinois Solar for All Program is and how it will be administered,

the law also requires that, should the IPA hire a third-party program administrator (or

administrators) to assist with the administration of the Illinois Solar for All Program, the Plan shall

identify how often that administrator must report to the Agency and the Commission (provided that

interval is at least quarterly). The Plan shall also provide for an independent evaluation of the

program.

The Plan must also ensure that the Illinois Solar for All program is funded. Specifically, Section 1-

75(c)(1)(O) of the Act now provides that the Plan “shall allocate up to $50,000,000 per delivery year

to fund the programs, and the plan shall determine the amount of funding to be apportioned to the

programs identified in subsection (b) of Section 1-56 of this Act.” The IPA understands that the

intention of this language in Section 1-75(c)(1)(O) is this “up to $50,000,000” is additive to whatever

may be allocated in a given year through the RERF.

Notwithstanding the language discussed in the paragraph above, the law also requires that “[f]or the

delivery years beginning June 1, 2021, June 1, 2024, June 1, 2027, and June 1, 2030 and [sic] additional

$10,000,000 shall be provided to the Department of Commerce and Economic Opportunity to

implement the workforce development programs and reporting as outlined in Section 16-108.12 of

the Public Utilities Act.”

This constitutes a change from the regime in place prior to the enactment

of P.A. 102-0662, which allocated those funds to ComEd for workforce development programs.

Additional Illinois Solar for All requirements to be outlined in this Plan include the specific level of

job trainee required to be used on ILSFA projects; a report on the “progress and barriers to

participation of small and emerging businesses in the Illinois Solar for All Program”; consideration of

“additional program and contract requirements to ensure faithful compliance by applicants

benefiting from preferences for projects designated to promote energy sovereignty”; reporting on

efforts to encourage “cross-participation” between the ABP and ILSFA programs; if warranted,

additional ILSFA programs that target distinct market segments and “incentives targeted to increase

the uptake of non-photovoltaic technologies by low-income customers, including energy storage

paired with photovoltaics”; and a determination as to whether “individual subprograms of the Illinois

Solar for All Program are better served by a different or separate Program Administrator” from the

ABP Program Administrator. Additionally, the Agency must include a plan for the following:

(A) actions to refer customers from the Illinois Solar for All Program to electric and natural

gas income-qualified energy efficiency programs, and vice versa, with the goal of increasing

participation in both of these programs;

(B) effective procedures for data sharing, as needed, to effectuate referrals between the

Illinois Solar for All Program and both electric and natural gas income-qualified energy

efficiency programs, including sharing customer information directly with the utilities, as

needed and appropriate; and

20 ILCS 3855/1-75(c)(1)(O). See also Docket No. 17-0332, in which ComEd’s Workforce Development Implementation Plan was

approved; this proceeding was reopened after passage of P.A. 102-0662 to reflect this shift in responsibilities.

Illinois Power Agency 2022 Long-Term Plan (Final) August 23, 2022

Solar for All Program customers may be eligible and to connect such customers to those

programs.

These and other items are addressed in Chapter 8 of the Plan.

2.5.2. Items Not Included in Long-Term Renewable Resource Procurement

Plan

While the Plan sets forth the IPA’s proposed approach to meeting the state’s renewable energy

resource procurement targets, it is not the sole mechanism for facilitating the development of

renewable energy in Illinois or providing value for the environmental attributes of electricity

generation. Thus, many items that may be of interest to readers of this Plan are not directly

addressed in it. Below is a non-exhaustive list of those items not addressed in the Plan:

• Contracts or tariffs for the sale of energy from renewable energy generating facilities,

whether through bilateral contracts, wholesale market sales, community renewable

generation bill crediting, or net metering;

• Previously effective renewable energy resource procurement obligations applicable to

alternative retail electric suppliers under Section 16-115D of the PUA;

• The procurement of zero emission credits from zero emission facilities under Section 1-75(d-

5) of the IPA Act, or carbon mitigation credits from carbon-free energy resources under

Section 1-75(d-10) of the IPA Act;

• Workforce development plans produced by a utility pursuant to Section 16-108.12 of the

PUA;

• Renewable energy generating device installer certification requirements developed pursuant

to Section 16-128A of the PUA;

• Tariff filings or modifications for the collection of funds used by utilities to pay for renewable

energy credit, zero emission credit, and carbon mitigation credit delivery contracts;

• Specific renewable energy generating projects, proposals, or sites, including any municipal,

county, or state permitting (e.g., actions by Agencies other than the IPA) required;

• “Green” or “clean energy” retail supply products marketed and sold by alternative retail

electric suppliers;

• Requirements and processes for the interconnection of new renewable energy generating

facilities, including projects facilitated by IPA-administered programs and procurements;

• Broader decarbonization plans, including the closure of Illinois fossil-based energy facilities;

• Energy storage workshops led by the Illinois Commerce Commission;

• Integrated grid planning processes, or other attempts to modify the electric distribution

system;

• Beneficial electrification initiatives, electric vehicle incentives, or electric vehicle

infrastructure policy;

• Renewable energy access plan development.

These issues may be of significant interest to the Agency, and in some cases, their presence or

resolution informed decisions made in this Plan. However, as they do not fall within the scope and

jurisdiction of what the IPA may propose and the Commission may approve as part of this Plan,

specific proposals related to the above-listed topics are not made within this document.

Illinois Power Agency 2022 Long-Term Plan (Final) August 23, 2022

2.5.3. 2022 Long-Term Plan Development and Approval

A draft Second Revised Long-Term Plan was published on Monday August 16, 2021 (within two years

of its First Revised Plan’s publishing), but ultimately withdrawn under direction provided by Section

1-75(c)(1)(A) of the Act through P.A. 102-0662. Instead, given that P.A. 102-0662’s changes in state

law were sufficiently extensive to require the development of an entirely new Plan, a new draft Long-

Term Plan was required to be developed and published within 120 days of the effective date of P.A.

102-0662—by January 13, 2022. Under the requirements of Section 16-111.5(b)(5)(ii) of the PUA,

affected utilities and interested parties were allowed 45 days to provide comment, resulting in a

comment deadline of Monday, February 28, 2022.

Forty-one sets of written comments were received on the draft Plan.

During the comment period,

the Agency was also required to hold public hearings for receiving public comment on the Plan in the

service territory of each affected utility. Given the uncertainty around the ongoing COVID-19 global

health pandemic, the Agency conducted those public hearings virtually on February 18, 2022 for all

three affected utility service territories.

Pursuant to Section 16-111.5(b)(5)(ii), the IPA may then revise its draft 2022 Long-Term Plan based

upon the comments received. The filed version of the 2022 Long-Term Plan reflected those revisions

and was filed on March 21, 2022, 21 days after the February 28, 2022 comment deadline.

The Commission’s approval of the filed 2022 Long-Term Plan took the form of a docketed proceeding

conducted pursuant to the Commission’s Rules of Practice.

The Commission approved the 2022

Long-Term Plan through its July 14, 2022 Final Order in ICC Docket No. 22-0231; this Final Plan

reflects revisions necessitated by the Commission’s Final Order in that proceeding (in addition to

other updates where applicable).

2.5.4. Plan Updates

While the Agency’s long-term renewable resources procurement plan features a “long-term” focus,

many elements informing future program and procurement decisions—technological progress,

marketplace changes, the success or failure of work undertaken under a prior-approved approach—

were unknowable at the time of the Initial Plan’s publishing and are still unknowable as of today.

As described above, the PUA provides that the Agency “shall review, and may revise, the plan at least

every 2 years” after the Initial Plan, and “shall review and propose any revisions to the long-term

renewable energy resources procurement plan in conjunction with the Agency's other Section 16-

111.5 planning and approval processes.”

At present, and absent a statutory change through new

legislation, the Agency tentatively plans for its next revisions to its Long-Term Renewable Resources

Procurement Plan to be proposed in 2023, as part of the development and approval process of the

IPA’s 2024 annual procurement plan.

The PUA also requires that “the Commission shall hold an informal hearing for the purpose of

receiving comments on the prior year's procurement process and any recommendations for change”

Forty-five days from the date of publication of the draft 2022 Long-Term Plan was February 27, 2022, which falls on a Sunday. Pursuant

to the Statute on Statutes, the deadline for comments was February 28, 2022.

Comments on the draft Plan can be found here:https://ipa.illinois.gov/energy-procurement/comments-on-the-draft-2022-long-term-

renewable-resources-procure.html.

83 Ill. Adm. Code 200.

220 ILCS 5/16-111.5(b)(5)(ii)(B).

Illinois Power Agency 2022 Long-Term Plan (Final) August 23, 2022

on or before July 1 of each year.

This has taken the form of written recommendations, technical or

substantive, being submitted to the Commission and posted publicly on the Commission’s website.

2.6. The RPS and Percentage-Based Goals of the RPS

The Illinois RPS is similar to other state renewable portfolio standards, which require that a certain

percentage of electricity sales be met with a climbing percentage of renewable energy or renewable

energy credit procurement. For Illinois, this total is now “40% by 2030, climbing to 50% by 2040.”

2.6.1. Load Applicable to RPS Goals

Prior to P.A. 99-0906, only “eligible retail customer” load—meaning load associated with utility

default supply customers, and not customers taking supply through alternative retail electric

suppliers (“ARES”) or through hourly pricing—was subject to this requirement. Changes to the RPS

arising from the enactment of P.A. 99-0906 transitioned renewable goals applicable only to “eligible

retail customer” load to goals applicable to “all load for retail customers” by the 2019 delivery year,

and P.A. 102-0662 maintains that approach.

Certain exceptions exist to this load calculation. Under Section 1-75(c)(1)(H), if an ARES owned one

or more renewable generating facilities that were not wind or photovoltaic as of December 31, 2015,

then that ARES may elect “to supply its retail customers with renewable energy credits from the

facility or facilities” so long as those facilities continued to be owned by that ARES. This self-

procurement from ARES-owned facilities thus serves to reduce the statutory renewable energy

resource obligation by the number of RECs self-procured.

Similarly, successful customer

participation through the self-direct RPS compliance program found in Section 1-75(c)(1)(R) of the

Act should result in that retail customer load no longer being subject to RPS procurement

requirements.

Further discussion of how these percentage-based multipliers apply to retail customer load to create

actual REC procurement targets is presented in Chapter 3. As now expressly required under Section

1-75(c)(1)(B), “[t]he Agency shall not comply with the annual percentage targets described in this

subparagraph (B) by procuring renewable energy credits that are unlikely to lead to the development

of new renewable resources.”

Notably, these RPS goals only apply to load served by Illinois’ major electric distribution utilities:

ComEd, Ameren Illinois, and that portion of MidAmerican load for which the IPA conducts

procurements. The Illinois RPS goals do not apply to load served by municipal electric utilities, rural

electric cooperatives, or Mt. Carmel Public Utility Company, and those entities do not have renewable

energy procurement obligations under Illinois law.

220 ILCS 5/16-111.5(b)(5)(vi). Information about the Commission’s most recent informal hearing can be found here:

https://www.icc.illinois.gov/programs/Electricity-Procurement-Process-for-Plan-Years-Beginning-June-2022.

For example, see: https://www.icc.illinois.gov/workshops/Electricity-Procurement-Process-for-Plan-Years-Beginning-June-2019.

20 ILCS 3855/1-75(c)(1)(B).

For the 2021-2022 delivery year, see the following report on the RECs supplied under this

provision:https://ipa.illinois.gov/content/dam/soi/en/web/ipa/documents/2022-report-of-aggregate-amount-of-recs-supplied-by-

ares.pdf. Tables describing progress toward RPS goals found in Chapter 3 account for these RECs.

20 ILCS 3855/1-75(c)(1)(B).

Illinois Power Agency 2022 Long-Term Plan (Final) August 23, 2022

2.6.2. Eligible Projects for the Illinois RPS

Not all renewable energy generating facilities are eligible to sell RECs into the Illinois RPS. Changes

made through P.A. 99-0906 significantly narrowed the universe of facilities capable of generating

RECs which qualify for the RPS, and those changes were largely kept intact through P.A. 102-0662.

Specific criteria applicable to RECs or facilities producing those RECs are discussed further below.

2.6.2.1. Eligible Generating Technologies

The Illinois Power Agency Act’s definition of “renewable energy resource” as set forth in Section 1-

10 provides that the underlying energy must be generated “from wind, solar thermal energy,

photovoltaic cells and panels, biodiesel, anaerobic digestion, crops and untreated and unadulterated

organic waste biomass, and hydropower that does not involve new construction or significant

expansion of hydropower dams, waste heat to power systems, or qualified combined heat and power

systems” as well as “landfill gas produced in the State.” The IPA understands that only those

generating technologies delineated in the definition may qualify.

Through P.A. 102-6662, this

definition now also expressly includes “high voltage direct current renewable energy credits and the

associated energy converted to alternating current by a high voltage direct current converter station

to the extent that: (1) the generator of such renewable energy resource contracted with a third party

to transmit the energy over the high voltage direct current transmission facilities, and (2) the third-

party contracting for delivery of renewable energy resources over the high voltage direct current

transmission facilities have ownership rights over the unretired associated high voltage direct

current renewable energy credit.”

The Act also sets forth certain generating technologies categorically incapable of producing RECs

eligible for the Illinois RPS, which include “the incineration or burning of tires, garbage, general

household, institutional, and commercial waste, industrial lunchroom or office waste, landscape

waste, railroad crossties, utility poles, or construction or demolition debris, other than untreated and

unadulterated waste wood.”

These requirements are merely threshold requirements for a REC’s technical eligibility for the Illinois

RPS; specific programs, such as the Adjustable Block Program, and specific outlined procurement

targets carry additional limitations on eligible generating technology. Thus, while Public Act 102-

0662 expanded the definition of “renewable energy resource” to include technologies such as waste

heat to power systems (“WHP”) and qualified combined heat and power systems (“CHP”), Section 1-

75(c) of the IPA Act contains no language authorizing program or procurement activity to procure

RECs from WHP and CHP systems.

Instead, Section 1-75(c)(1)(C) establishes targets only for the

procurement of RECs from “new wind and solar projects” with an express objective for “the goals in

subparagraph (B) of this paragraph (1)” – the percentage-based RPS goals – be “met entirely by

procurements of renewable energy credits from new wind and photovoltaic projects.” As a

The Agency understands that hydropower facilities featuring new turbines added to existing non-hydropower dams would not be eligible

to participate as these facilities would constitute a newly constructed “hydropower” dam, and would thus be prohibited under Section 1-

10 of the IPA Act’s limitation of eligible hydropower only to “hydropower that does not involve new construction or significant expansion

of hydropower dams.”

20 ILCS 3855/1-10.

Id.

These changes to the definition of “renewable energy resource” may nevertheless be impactful in other contexts. For example, by

expressly including CHP and WCP technologies in Section 1-10’s definition of “renewable energy resources,” RECs from those systems may

be eligible for use by retail electric suppliers for “green” or “renewable” retail supply offers to Illinois businesses and residents.

Illinois Power Agency 2022 Long-Term Plan (Final) August 23, 2022

consequence, this Plan seeks the procurement of RECs only from wind and photovoltaic projects,

while also exploring a Request for Information process around non-PV or wind community

renewable generation projects under Section 1-75(c)(1)(N)’s express authorization that the Agency

“may consider whether community renewable generation projects utilizing technologies other than

photovoltaics should be supported through State-administered incentive funding.”

2.6.2.2. Eligible Projects—Locational

Under the regime introduced by P.A. 99-0906 through Section 1-75(c)(1)(I), a generating facility’s

RECs are no longer prioritized based on location; instead, the facility either qualifies for the Illinois

RPS, or it does not. Outside of language specific to RECs associated with electricity transmitted to

qualifying Illinois-based high voltage direct current converter stations, this approach was maintained

through P.A. 102-0662.

Section 1-75(c)(1)(I) provides that the Plan must be designed “to maximize the State's interest in the

health, safety, and welfare of its residents, including but not limited to minimizing sulfur dioxide,

nitrogen oxide, particulate matter and other pollution that adversely affects public health in this

State, increasing fuel and resource diversity in this State, enhancing the reliability and resiliency of

the electricity distribution system in this State, meeting goals to limit carbon dioxide emissions under

federal or State law, and contributing to a cleaner and healthier environment for the citizens of this

State.” While the statute determines that a facility located in-state provides those benefits at a

sufficient level, the Agency also “may qualify renewable energy credits from facilities located in states

adjacent to Illinois if the generator demonstrates and the Agency determines that the operation of

such facility or facilities will help promote the State's interest in the health, safety, and welfare of its

residents” based on this public interest criteria. As the law provides no discussion of potentially

qualifying facilities located in states not “adjacent to Illinois,” facilities located in those states

generally cannot produce RECs for satisfying the Illinois RPS.

The Agency’s discussion of how to apply these criteria to adjacent state facilities, as well as a listing

of which states are considered “adjacent” to Illinois, can be found in Chapter 4.

2.6.2.3. Eligible Projects—Cost Recovery

Through Section 1-75(c)(1)(J), RECs from “a generating unit whose costs were being recovered

through rates regulated by this State or any other state or states on or after January 1, 2017” are also

considered non-compliant with the Illinois RPS. The statute’s stated rationale behind this prohibition

is to “promote the competitive development of renewable energy resources in furtherance of the

State's interest in the health, safety, and welfare of its residents.”

In application, the Agency understands this limitation does not apply to municipal utilities or rural

cooperatives that effectively serve as vertically-integrated utilities (as even insofar as they can

achieve full cost recovery for the development of renewable energy generating facilities through

rates, their rates are in most cases still not regulated by “this state or any other state or states”),

but

would still apply to non-electric utilities (e.g., water, gas, telecommunications) regulated by the

Illinois Commerce Commission or by another state for which rate recovery could be sought for a

photovoltaic system participating in the Illinois RPS.

20 ILCS 3855/1-75(c)(1)(J).

Illinois Power Agency 2022 Long-Term Plan (Final) August 23, 2022

The law also offers more punitive consequences if a non-regulated rate facility becomes a regulated

rate facility after the execution of an Illinois RPS contract. In such a situation, the contract must be

terminated and “the supplier of the credits must return 110% of all payments received under the

contract,” with those payments then being used for the procurement of additional RECs from new

wind or photovoltaic generation in the Agency’s next procurement event.

Since the passage of P.A.

99-0906, contracts developed for the Agency’s programs and procurements have contained

provisions reflecting this penalty.

The Agency’s approach to these issues is discussed in Chapter 4.

2.6.2.4.

Installer & Labor Requirements

Certain facilities seeking to participate in the RPS are also subject to an installer qualification

requirement. Specifically, RECs from “new photovoltaic projects or new distributed renewable

energy generation devices [. . .] must be procured from devices installed by a qualified person in

compliance with the requirements of Section 16-128A of the Public Utilities Act and any rules or

regulations adopted thereunder.”

In Docket No. 17-0268, the Illinois Commerce Commission adopted its Title 83, Part 461

administrative rules for the installation of new utility-scale photovoltaic generating projects under

Section 16-128A of the PUA. In that proceeding, the Commission adopted the following definition for

the term “qualified person” for new utility-scale solar installations:

"Qualified person" means a person who performs installations on behalf of the

certificate holder and who has completed at least one of the following programs

requiring lab or field work and received a certification of satisfactory completion: an

apprenticeship as a journeyman electrician from a USDOL-registered or an applicable

state-agency-registered electrical apprenticeship and training program; a North

American Board of Certified Energy Practitioners (NABCEP) distributed generation

technology certification program; an electrical training program for in-house

employees established and administered by an electric utility regulated by the

Commission; or an Associate in Applied Science degree from an Illinois Community

College Board-approved community college program in solar generation technology.

The Part 461 rules also provide a definition of the term “install”:

"Install" means to perform the electrical wiring and connections necessary to

interconnect the new solar project with the electric utility's transmission or distribution

system at the point of interconnection between the project and the utility. "Install" in

this Part specifically does not mean:

• Electrical wiring and connections to interconnect the new solar project

performed by utility workers;

Id.

20 ILCS 3855/1-75(c)(7). The “qualified person” requirement is expressly not applicable to the Illinois Solar for All Program (see 20

ILCS 3855/1-56(b)(2), final paragraph), although installers of ILSFA projects must, under state law, still have ICC certification under Part

468 as Distributed Generation Installers.

83 Ill. Adm. Code § 461.10.

Illinois Power Agency 2022 Long-Term Plan (Final) August 23, 2022

• Electrical wiring and connections internal to the new solar project

performed by the manufacturer;

• The on-site construction and installation of a solar panel or a collector

substation; or

• Tasks relating to construction, planning and project management

performed by individuals such as an inspector, management planner,

consultant, project designer, or contractor for the project or their

employees.

Definitions of these terms were initially approved by the Commission in a Second Notice Order on

August 25, 2017 and approved with modification by the state’s Joint Committee on Administrative

Rules (“JCAR”) on October 24, 2017 with an effective date of October 26, 2017.

Any parties seeking to develop new photovoltaic projects in Illinois should be aware of the

Commission’s Part 461 rules (governing installers of utility-scale photovoltaics) and Part 468 rules

(governing distributed generation installers) and certification process more generally.

Through the addition of new Section 1-75(c)(1)(Q)(1) of the Act under P.A. 102-0662, most new

projects supported under the Illinois RPS must also now meet Prevailing Wage Act requirements

including, but not limited to, paying the prevailing wage to workers engaged in the construction of

new renewable energy facilities. Exceptions to these requirements exist for “houses of worship”

where aggregated co-located project capacity would not exceed 100 kilowatts and “projects that

serve single-family or multi-family residential buildings.” Section 1-75(c)(1)(G)(iv)(ii) provided an

additional exemption for previously-waitlisted Large DG ABP projects in the ABP reopening prior to

the publication of this Plan. Additional information on the IPA’s approach to ensuring Prevailing

Wage Act compliance can be found in Chapter 7.

Under Section 1-75(c)(1)(Q)(2) of the Act, new utility-scale wind, utility-scale solar, and brownfield

site photovoltaic produced RECs must also “be from facilities built by general contractors that must

enter into a project labor agreement, as defined by this Act, prior to construction.” Section 1-10 of

the Act defines a project labor agreement as “a pre-hire collective bargaining agreement that covers

all terms and conditions of employment on a specific construction project,” and outlines specific

elements required to be included in that agreement:

(1) provisions establishing the minimum hourly wage for each class of labor organization

employee;

(2) provisions establishing the benefits and other compensation for each class of labor

organization employee;

(3) provisions establishing that no strike or disputes will be engaged in by the labor

organization employees;

(4) provisions establishing that no lockout or disputes will be engaged in by the general

contractor building the project; and

(5) provisions for minorities and women, as defined under the Business Enterprise for

Minorities, Women, and Persons with Disabilities Act, setting forth goals for apprenticeship

hours to be performed by minorities and women and setting forth goals for total hours to

be performed by underrepresented minorities and women.

Illinois Power Agency 2022 Long-Term Plan (Final) August 23, 2022

Project labor agreements must be filed with the Agency Director and must “provide the names,

addresses, and occupations of the owner of the plant and the individuals representing the labor

organization employees participating in the project labor agreement consistent with the Project

Labor Agreements Act,” as well as specifying “the terms and conditions as defined by this Act.” A

labor organization and the general contractor building the project shall have the authority to include

other terms and conditions as they deem necessary. Additionally, as proposed by the IPA in Docket

No. 22-0231 and affirmed by the Commission in approving the Plan, project labor agreement

submittals must also include a description of the efforts the entity will take or has taken to achieve

such goals, including recruitment of minorities and women into apprenticeship roles.

Additional information on the submission of project labor agreements for projects participating in

the IPA’s competitive procurements can be found in Chapter 5.

2.6.3. Compliance Mechanism: RECs vs. “Renewable Energy Resources”

An additional change to the Illinois RPS originally made through P.A. 99-0906 and maintained

through P.A. 102-0662 was a focus on the use of only RECs as the compliance mechanism for meeting

Illinois renewable energy procurement targets. Prior to P.A. 99-0906, Section 1-75(c) required

renewable energy procurement targets to be met through the procurement of “renewable energy

resources”—either a REC, or the REC and its underlying energy. While most IPA procurement

activities focused only on the procurement of RECs, the 2010 long-term power purchase agreements

are 20-year contracts for the delivery of a “bundled” REC and energy product.

Rather than using the term “renewable energy resources,” Section 1-75(c)(1)(B) requires that the

Plan “shall include the goals for procurement of renewable energy credits”

to meet the statute’s

targets. Focusing only on “RECs” makes intuitive sense: while the IPA now conducts renewable

energy planning and procurement processes to meet goals and targets applicable to all retail

customer load,

its energy procurements still focus only on eligible retail customer load—thus

creating a disconnect between the universes of supply requirements served by these two exercises.

Over time, the IPA has become aware of concerns held by developers of utility-scale renewable

energy projects that there may be a shallow market for long-term bilateral energy off-take

agreements for geographically-qualifying new projects, which developers believe are necessary for

providing the revenue certainty required for financing new facility construction. The Agency

understands that these concerns informed changes to the REC pricing structure for projects

supported under competitive procurements found in Section 1-75(c)(1)(G)(v) of the Act, with a shift

to an Indexed REC pricing structure under which, as wholesale energy prices fall, REC prices rise

commensurately—and vice versa. By allowing bidders to bid in a “strike price” reflecting both

required REC and energy revenues, the Agency understands that this model—if interpreted and

implemented in a manner faithful to the spirit of ensuring that project developers are made whole at

that strike price—will functionally serve the same end as a bundled REC and energy contract for

See Docket No. 22-0231, Final Order dated July 14, 2022 at 7.

Emphasis added.

Specifically, the IPA’s long-term renewable resources procurement plan shall include renewable resource procurement for 100% of

retail customer load beginning with the delivery year beginning June 1, 2019, after procuring for an increasing portion of retail customer

load for the prior two delivery years. See 20 ILCS 3855/1-75(c)(1)(B).

Illinois Power Agency 2022 Long-Term Plan (Final) August 23, 2022

developers of new utility-scale wind and solar projects and their financiers. This new Indexed REC

price structure is described in more detail in Chapter 5.

2.6.4. RPS Funding and Rate Impact Cap

The procurement of renewable energy credits is limited by an annual procurement budget

established through a rate impact cap. Specifically, “the total of renewable energy resources

procured under the procurement plan for any single year . . . shall be reduced for all retail customers

based on the amount necessary to limit the annual estimated average net increase due to the costs of

these resources included in the amounts paid by eligible retail customers in connection with electric

service to no more than 4.25% of the amount paid per kilowatthour by those customers during the

year ending May 31, 2009.”

This amount then “shall be applied to the actual amount of

kilowatthours of electricity delivered, or applicable portion of such amount [. . .] by the electric utility

in the delivery year immediately prior to the procurement to all retail customers in its service

territory.” This produces an annual REC procurement budget for the “costs of those resources” in a

given year.

Through the budgets established under the rate impact cap and the associated tariffs for the

collection of funds, the applicable electric utility “shall be entitled to recover all of its costs associated

with the procurement of renewable energy credits” under the Plan, including “associated reasonable

expenses for implementing the procurement programs, including, but not limited to, the costs of

administering and evaluating the Adjustable Block program.”

As a result, annual procurement

budgets based only on REC costs would be inaccurate, and some estimate of associated

administrative expenses must be included and taken into account.

Through changes introduced by P.A. 102-0662, Section 16-108(k) of the PUA now require utility

tariffs, which authorize funding collection for the RPS, to allow for a given delivery year’s unspent

budget amounts to be “rolled over” for later delivery years’ expenditures. Rather than requiring the

refund of any unspent amounts, Section 16-108(k) now provides that RPS collections in a given year

“may be spent by the utility for the procurement of renewable resources over any of the following 5

delivery years,” with first priority in expenditure assigned to “money collected in earlier delivery

years that has not yet been returned to customers.” Relatedly, additional changes to Section 16-

108(k) ensure that any amounts eligible for refund “shall be reduced by an amount equal to the

payment obligations required by any contracts entered into by an electric utility . . . even if such

payments have not yet been made and regardless of the delivery year in which those payment

obligations were incurred.” The Agency believes that these new safeguards should help ensure that

the full amount of collections authorized under Section 1-75(c)(1)(E) are ultimately leveraged to

support new renewable energy project development and should help address the RPS budget “cliff”

problems experienced across 2021. Further discussion of how these changes impact the Agency’s

annual estimates of RPS budgets can be found in Chapter 3.

20 ILCS 3855/1-75(c)(1)(E).

The exception referenced above in Section 1-75(c)(1)(H) serves to reduce available budgets, as “the charges that would otherwise be

applicable to the retail customers of the alternative retail electric supplier . . . shall be reduced by the ratio of the quantity of renewable

energy credits supplied by the alternative retail electric supplier compared to that supplier's target renewable energy credit quantity.”

Similarly, bill crediting under Section 1-75(c)(1)(R)’s large customer self-direct RPS compliance program serves to reduce available

budgets as well.

20 ILCS 3855/1-75(c)(6).

Illinois Power Agency 2022 Long-Term Plan (Final) August 23, 2022

2.7. Quantitative New Build Targets of the RPS

Section 1-75(c)(1)(B) of the IPA Act provides percentage-based umbrella goals for RECs required to

be procured based on a percentage of applicable retail customer load. But within those umbrella

requirements more specific requirements must also be met—and indeed prioritized above those

percentage-based goals.

One such requirement is the procurement of RECs from “new wind projects” and “new photovoltaic

projects” found in Section 1-75(c)(1)(C). Rather than expressed as a percentage of load, these

requirements are expressed on a quantitative basis (i.e., a statutorily-defined minimum number of

RECs delivered annually) while still counting toward the overall renewables percentage-based

procurement goals.

2.7.1. Quantitative Procurement Requirements

As modified by P.A. 102-0662, Section 1-75(c)(1)(C)(i) establishes aggressive new targets for the

quantity of RECs procured from “new” solar and wind projects: “10,000,000 renewable energy

credits delivered annually by the end of the 2021 delivery year, and increasing ratably to reach

45,000,000 renewable energy credits delivered annually from new wind and solar projects by the

end of delivery year 2030.” The relative proportions of those amounts are 45% from wind projects

and 55% from photovoltaic projects. Of the photovoltaic project portion, the Agency shall procure

“at least 50%” from the Adjustable Block Program, “at least 47%” from utility-scale solar projects,

and “at least 3%” from non-community solar brownfield site photovoltaic projects.

Consistent with RPS implementation across 2017-2021, the Agency interprets this “at least 50%”

concept to be in terms of RECs (as opposed to budget or installed capacity), and out of the

quantitative target amounts listed in the law—and not necessarily 50% of the overall number of RECs

procured. In Docket No. 17-0838 approving the IPA’s Initial Long-Term Plan, the Illinois Commerce

Commission authorized utility-scale photovoltaic procurements resulting in significantly more

utility-scale photovoltaic RECs under contract than the Adjustable Block Program could possibly

sustain given budget limitations, further reinforcing that these proportions are intended to establish

minimum amounts of totals rather than proportionate overall percentages.

The Agency has made meaningful progress toward meeting these totals through prior RPS

procurement activity from “new” projects, with millions of RECs already under contract to be

delivered annually from new wind and new photovoltaic projects. Further discussion of this progress

can be found in Chapter 3 of this Plan, while the Agency’s discussion of competitive procurements for

meeting these targets can be found in Chapter 5.

2.7.2. “New wind project” and “new photovoltaic project” Definition

The statute provides definitions of a “new wind project” and a “new photovoltaic project.” A “new

photovoltaic project” is a “photovoltaic renewable energy facilit[y] that [is] energized after June 1,

2017.”

Projects developed under Section 1-56 of the IPA Act (i.e., supplemental photovoltaic and

Illinois Solar for All projects) are not eligible to meet quantitative “new photovoltaic project”

targets.

20 ILCS 3855/1-75(c)(1)(C)(iii).

Id.

Illinois Power Agency 2022 Long-Term Plan (Final) August 23, 2022

The definition of a “new wind project” was revised through P.A. 102-0662. Previously, Section 1-

75(c)(1)(C)(iii) defined new wind projects” as “wind renewable energy facilities that are energized

after June 1, 2017 for the delivery year commencing June 1, 2017 or within 3 years after the date the

Commission approves contracts for subsequent delivery years.”

Through P.A. 102-0662, the

underlined phrasing of “within 3 years after the date…” has been stricken from statute, thus no longer

establishing a minimum delivery timeline requirement for a project to be considered “new”. The IPA

thus now understands that the “new wind project” definition essentially mirrors the “new

photovoltaic project” definition, with the “for the delivery year commencing June 1, 2017” remaining

within that definition referring to each delivery year thereafter as well (as, otherwise, there would

be no applicable definition for a “new wind project”).

Both definitions raise the question of what constitutes a facility being “energized.” Unlike

interconnection, where official approval is required and associated forms are produced and executed

on a specific date, “energized” is more nebulous and, unfortunately, not defined through the law.

Faced with a similar quandary in developing its Supplemental Photovoltaic Procurement Plan, the

Agency settled on a definition of “energized” as being “the date by which the System has been turned

on for a period of 24 consecutive hours and is operational for purposes of generating electricity

regardless of whether the system has registered with a REC tracking system.” Parties could then

substantiate a system’s energization through a certification accompanied by the submission of

various forms establishing a system’s energization timeline. The Agency notes that unlike the

Supplemental Photovoltaic Procurement process, in which payment for RECs was made after REC

generation and only upon delivery and invoice to the Agency, the Adjustable Block Program and the

Illinois Solar for All Program feature prepayment for some, or all, of the RECs from a system upon

energization. Therefore, as discussed in Chapters 7 and 8, consideration is also given to a system

being registered in a tracking system to generate RECs in addition to the date on which

interconnection to the utility was approved.

2.7.3. Forward Procurements Conducted Outside of This Plan

Independent of (and, in some cases, prior to) the development of the Initial Plan, P.A. 99-0906

required the IPA to conduct “initial forward procurements” of RECs from “from new utility-scale wind

projects” and “from new utility-scale solar projects and brownfield site photovoltaic projects.”

Conducted through competitive procurement processes subject to applicable requirements of

Section 16-111.5 of the PUA, the Initial Forward Procurement sought 15-year REC delivery contracts

set to begin delivery on June 1, 2019 at the earliest and—initially—June 1, 2021 at the latest (that

deadline has since been extended to June 1, 2022 through Public Act 101-0113 in the case of certain

development risks). For both wind and solar, the targeted overall REC procurement quantities were

1,000,000 RECs delivered annually from each generating technology, with a single wind procurement

event required to take place within 160 days of June 1, 2017 and the solar procurement potentially

conducted across multiple procurement events up to one year from June 1, 2017.

In a similar manner, Section 1-75(c)(1)(G)(iii) required that the Agency “conduct at least one

subsequent forward procurement for renewable energy credits from new utility-scale wind projects,

new utility-scale solar projects, and new brownfield site photovoltaic projects within 240 days” after

20 ILCS 3855/1-75(c)(1)(C). (Emphasis added.)

20 ILCS 3855/1-75(c)(1)(G)(i), (ii).

Id.

Illinois Power Agency 2022 Long-Term Plan (Final) August 23, 2022

the effective date of P.A. 102-0662. The statutory requirement for completion of this procurement

event was May 13, 2022—well before the Commission’s deadline for approval of this Plan. The

procurement quantity for this “subsequent forward procurement” is “quantities necessary to meet

the requirements of subparagraph (C) of this paragraph (1) through the delivery year beginning June

1, 2021,” which required certain interpretive decisions around what REC quantities are required

from which project categories through this subsequent forward procurement event to meet Section

1-75(c)(1)(C)’s “10,000,000 renewable energy credits delivered annually by the end of the 2021

delivery year” target quantity. As those decisions establishing procurement quantities for this

procurement could not be made through this Plan from a timing standpoint, they are outside of the

scope of the Plan.

Section 1-75(c)(1)(G)(i) and (ii) of the Act expressly provide that RECs procured through the Initial

Forward Procurement “shall be included in the Agency's Long-Term Renewable Resources

Procurement Plan and shall apply to all renewable energy goals”

found in Section 1-75(c) of the IPA

Act, including the quantitative “new wind” and “new photovoltaic” targets discussed above. While

not expressly stated, the same must be true for those procurement events conducted pursuant to

Section 1-75(c)(1)(G)(iii), as those procurements are required to be sized so as to meet Section 1-

75(c)(1)(C)’s requirements. The Agency’s procurement quantities for the initial forward

procurements and for this pre-Plan/post-P.A. 102-0662 subsequent forward procurement event are

reflected in Chapter 5.

New Section 1-75(c-5) of the Act also requires the Agency to “conduct procurement events . . . of

renewable energy credits from new renewable energy facilities to be installed at or adjacent to the

sites of electric generating facilities that, as of January 1, 2016, burned coal as their primary fuel

source” and meet other specified criteria (including the development of on-site storage projects).

While this “coal-to-solar” procurement is not covered by this Long-Term Plan, RECs procured by

Illinois electric utilities serving more than 300,000 customers through REC delivery contracts

resulting from coal-to-solar procurements “may be included or counted for purposes of compliance

with the amounts of renewable energy credits required to be procured” pursuant to Section 1-75(c)

“to the extent that there are otherwise shortfalls in compliance with such requirements.” Additional

information about the coal-to-solar procurement process can be found on the IPA Procurement

Administrator’s website: https://www.ipa-energyrfp.com/coal-to-solar/.

2.7.4. Competitive Procurements Proposed Through This Plan

To meet the aggressive targets set forth by Section 1-75(c)(1)(C) of the Act for wind, utility-scale

solar, and brownfield site photovoltaic projects, additional procurement events will need to be

scheduled in the years ahead.

RECs under contract from Subsequent Forward Procurements are included in tables found in Chapter

3, while further discussion of competitive procurement events including any proposed Subsequent

Forward Procurements can be found in Chapter 5.

2.7.4.1. Indexed REC Price Structure

Changes to Section 1-75(c)(1)(G)(v) of the Act enacted through P.A. 102-0662 now require that “for

all competitive procurements and any procurements of renewable energy credit [sic] from new

Id.

Illinois Power Agency 2022 Long-Term Plan (Final) August 23, 2022

utility-scale wind and new utility-scale photovoltaic projects,” an Indexed REC price structure must

be used. Under this structure, bidders offer a “strike price” defined as “a contract price for energy

and renewable energy credits,” akin to an all-in price for RECs and energy. Under the Indexed REC

pricing structure, a resulting REC price constitutes “the difference resulting from subtracting the

strike price from the index price for that settlement period,” with the index price representing “the

real-time energy settlement price at the applicable Illinois trading hub.” Under the law, “[i]f this

difference results in a negative number, the [buyer] shall owe the seller the absolute value multiplied

by the quantity of energy produced in the relevant settlement period.” But [i]f this difference results

in a positive number, the seller shall owe the [buyer] this amount multiplied by the quantity of energy

produced in the relevant settlement period.”

Thus, if real-time energy settlements yielded a $40 energy settlement price, the resulting REC price

under a contract featuring a $45 strike price would be $5 per REC for that settlement period.

However, if real-time energy settlements yielded a $50 energy settlement price, a $45 strike price

would result in a $5 per REC payment from Seller (the bidder in competitive procurements) back to

the Buyer (the counterparty electric utility). To ensure that prices remain predictable and affordable,

the Agency may also propose a price collar through this Plan to place boundaries around REC price

volatility.

The Agency understands this new Indexed REC pricing approach to offer revenue certainty back to

renewable energy project developers in a manner that functions similarly to a bundled fixed price

REC + energy off-take agreement. In times when energy revenues are low, REC prices are high; in

times when energy revenues are high, REC prices adjust downward accordingly. The end result is

revenue certainty regardless of wholesale energy market conditions, hopefully solving financing and

development barriers for entities seeking to develop new utility-scale wind and utility-scale solar

projects under the Illinois RPS.

Additional discussion of the Indexed REC price structure is presented in Chapter 5.

2.7.4.2. Bid Evaluation in Competitive Procurements

P.A. 102-0662 includes two new provisions that may impact bid evaluation in competitive

procurement events. Section 1-75(c)(1)(P) requires the Agency to develop “a method to optimize

procurement of renewable energy credits from proposed utility-scale projects that are located in

communities eligible to receive Energy Transition Community Grants pursuant to Section 10-20 of

the Energy Community Reinvestment Act.” Under the Energy Community Reinvestment Act,

communities eligible to receive Energy Transition Community Grants must meet one or more of the

following criteria:

(1) the area contains a fossil fuel or nuclear power plant that was retired from service or

has significantly reduced service within 6 years before the application for designation or

will be retired or have service significantly reduced within 6 years following the application

for designation;

20 ILCS 3855/1-75(c)(1)(G)(v)(1).

Illinois Power Agency 2022 Long-Term Plan (Final) August 23, 2022

(2) the area contains a coal mine that was closed or had operations significantly reduced

within 6 years before the application for designation or is anticipated to be closed or have

operations significantly reduced within 6 years following the application for designation; or

(3) the area contains a nuclear power plant that was decommissioned, but continued

storing nuclear waste before the effective date of this Act.

If the need to optimize selection of projects in Energy Transition Community Grant eligible

communities “conflicts with other provisions of law,” or if the IPA determines that compliance “would

be unreasonably costly or administratively impractical,” the Agency may a) propose alternative

approaches to achieve the same ends or b) seek an exemption from this requirement from the ICC,

presumably through this Plan approval process. Additional discussion of this Energy Transition

Community Grant optimization requirement can be found in Chapter 5.

Section 1-75(c-10)(3) requires that, through this Plan, the Agency “develop requirements for

ensuring that competitive procurement processes, including utility-scale solar, utility-scale wind,

and brownfield site photovoltaic projects, advance the equity goals” of subsection (c-10). To comply

with this Section 1-75(c-10)(3) objective, the Agency must “develop bid application requirements

and a bid evaluation methodology for ensuring that utilization of equity eligible contractors . . . is

optimized.” Application requirements may include requiring “that winning or successful applicants

for utility-scale projects are or will partner with equity eligible contractors,” while bid evaluation

may require “giving preference to bids through which a higher portion of contract value flows to

equity eligible contractors.” Additional discussion of competitive procurements can be found in

Chapter 5, while the Agency’s approach to implementation of subsection (c-10) can be found in

Chapter 10.

2.7.4.3. Alternatives for Brownfield Site Photovoltaic Projects

Section 1-75(c)(1)(C)(i) now authorizes the Agency to “consider other approaches, in addition to

competitive procurements, that can be used to procure renewable energy credits from brownfield

site photovoltaic projects.” The Agency understands this language to allow for a shift away from

competitive procurements and to an alternative structure – whether through a fixed-price, open-

enrollment program akin to the Adjustable Block Program; an application process with qualitative

criteria utilized to score projects similar to how community-driven community solar operates; or

something else altogether – to award REC delivery contracts to proposed brownfield site

photovoltaic projects. Further discussion of this language is found in Chapter 5; for purposes of this

first Plan developed pursuant to P.A. 102-0662, and especially in light of the changes offered through

the shift to an Indexed REC pricing structure, this Plan will continue utilization of competitive

procurements for supporting brownfield site photovoltaic projects. Future plans may then evaluate

the success of the competitive procurement approach relative to “other approaches” and propose

modifications to this model.

2.8. Adjustable Block Program & Community Renewable Generation

As referenced above, at least 50% of the quantitative new photovoltaic project target found in Section

1-75(c)(1)(C) of the IPA Act shall be procured “from solar photovoltaic projects using the program

outlined in subparagraph (K) of this paragraph (1) from distributed renewable energy generation

devices or community renewable generation projects”—i.e., using the Adjustable Block Program.

Illinois Power Agency 2022 Long-Term Plan (Final) August 23, 2022

2.8.1. Adjustable Block Program

At its core, the Adjustable Block Program is perhaps most notable for what it is not: it is not a

“competitive procurement event” using “pay as bid” pricing with selection of bids based on price, as

discussed in the Section above. Nor is it a project selection process through which the winning bidder

is determined by public interest criteria, such as those set forth in Section 1-75(c)(1)(I) or used in

the selection of winning bids under the Zero Emission Standard found in Section 1-75(d-5) or under

the Carbon Mitigation Credit procurement found in Section 1-75(d-10) of the Act.

Instead, the Adjustable Block Program provides “a transparent annual schedule of prices and

quantities to enable the photovoltaic market to scale up and for renewable energy credit prices to

adjust at a predictable rate over time.”

Stated differently, a party seeking a REC contract—such as

a photovoltaic distributed generation or community solar project developer—knows the REC price

in advance and generally when and how that price may change.

The law sets forth other requirements of the Adjustable Block Program: it must include “a single block

of nameplate capacity, a price for renewable energy credits within that block, and the terms and

conditions for securing a spot on a waitlist once the block is fully committed or reserved.”

Each

block constitutes a quantity of nameplate capacity with a REC price

attached to that block. Through

changes made via P.A. 102-0662, transitions between blocks now occur on an annual basis, rather

than through one block opening automatically at a different price after the prior block’s capacity is

filled.

Thus, “for each category” (of which there are now six) and “for each delivery year,” the Agency is

required to determine “the amount of generation capacity in each block, and the purchase price for

each block”—with those blocks priced and sized to ensure that Section 1-75(c)’s REC procurement

goals are met.

Pursuant to Section 1-75(c)(1)(G)(iv) of the Act as modified by P.A. 102-0662, the Adjustable Block

Program reopened for REC delivery contract awards and the receipt of new project applications on

December 14, 2021—90 days after the effective date of P.A. 102-0662. Decisions made for ABP

reopening occurred outside of this Planning process and are not outlined here. To the extent those

decisions are memorialized as program requirements on a going-forward basis, those requirements

are further discussed in Chapter 7.

2.8.1.1. Adjustable Block Program—Projects

Even with six separate project categories, the Adjustable Block Program broadly supports only two

project types: photovoltaic distributed renewable energy generation devices (i.e., solar DG), and

photovoltaic community renewable generation projects (i.e., community solar

Under Illinois law, a photovoltaic distributed renewable energy generation device must be:

20 ILCS 3855/1-75(c)(1)(K).

Id.

Prices can be a set value, or established as the product of a formula.

There are other forms of community solar recognized by Illinois law, including (A) properties owned or leased by multiple customers

that contribute to the operation of an eligible renewable electrical generating facility, and (B) individual units, apartments, or properties

located in a single building that are owned or leased by multiple customers and collectively served by a common eligible renewable

electrical generating facility. 220 ILCS 5/16-107.5(l)(1). These forms of community solar are not eligible for the Adjustable Block Program.

Illinois Power Agency 2022 Long-Term Plan (Final) August 23, 2022

(1) Powered by photovoltaics;

(2) interconnected at the distribution system level of either an electric utility as defined in this

Section, a municipal utility as defined in this Section that owns or operates electric

distribution facilities, or a rural electric cooperative as defined in Section 3-119 of the Public

Utilities Act (and thus, must be located in Illinois to be interconnected to such an entity);

and

(3) located on the customer side of the customer's electric meter and is primarily used to offset

that customer's electricity load.

In preparing this Plan, the Agency received inquiries from representatives of public university

“utilities” (which also serve as retail customers of electric utilities) about whether a distributed

renewable energy device technically interconnected to that university utility system, but offsetting

the electricity load from a university building that would otherwise need to be purchased by the

university as a distribution customer of an electric utility, would qualify for the Adjustable Block

Program. Under the Illinois Commerce Commission’s Order in Docket No. 22-0231, assuming the

public university is indeed a retail customer of an electric utility (or otherwise takes retail electric

service from a municipal utility or rural electric cooperative), a system interconnected in this manner

may qualify for the Adjustable Block Program under the above definition.

Under Illinois law, a photovoltaic community renewable generation project is a generation facility

that:

(1) is powered by photovoltaics;

(2) is interconnected at the distribution system level of an electric utility as defined in this

Section, a municipal utility as defined in this Section that owns or operates electric

distribution facilities, a public utility as defined in Section 3-105 of the Public Utilities Act, or

an electric cooperative, as defined in Section 3-119 of the Public Utilities Act (and thus, must

be located in Illinois to be interconnected to such an entity);

(3) credits the value of electricity generated by the facility to the subscribers of the facility; and

(4) is limited in nameplate capacity to less than or equal to 5,000 kilowatts.

Only new projects—those “energized on or after June 1, 2017”—are eligible for the Adjustable Block

Program.

More specifically, in terms of what project types participate at what level within the Adjustable Block

Program, the ABP now provides for six separate project categories at the following levels:

(1) At least 20% from distributed renewable energy generation devices with a nameplate

capacity of no more than 25 kilowatts;

(2) At least 20% from distributed renewable energy generation devices with a nameplate

capacity of more than 25 kilowatts and no more than 5,000 kilowatts;

20 ILCS 3855/1-10.

See Docket No. 22-0231, Final Order dated July 14, 2022 at 4.

Id.

The Agency may create sub-categories within this category to account for the differences between projects for small commercial

customers, large commercial customers, and public or non-profit customers.

Illinois Power Agency 2022 Long-Term Plan (Final) August 23, 2022

(3) At least 30% from photovoltaic community renewable generation projects;

(4) At least 15% from distributed renewable generation devices or photovoltaic community

renewable generation projects installed at public schools;

(5) At least 5% from community-driven community solar projects intended to provide more

direct and tangible connection and benefits to the communities which they serve or in which

they operate and, additionally, to increase the variety of community solar locations, models,

and options in Illinois;

(6) At least 10% from distributed renewable energy devices with a nameplate capacity under

5,000 kilowatts or photovoltaic community renewable generation projects submitted by

applicants that are equity eligible contractors.

Over time, the Agency shall propose to increase the percentage in the equity eligible contractor

category to 40% based on factors including the number of equity eligible contractors and capacity

used in that category in previous delivery years. That 40% is achieved through a commensurate

reduction in the percentage shares applicable to other categories.

Should any given category not be fully subscribed within a given year, the Agency is now required to

redistribute that capacity by giving priority to those categories featuring waitlisted projects. The REC

price applicable to those projects supported by redistributed capacity is required by law to be the

price applicable to that subsequent year (and not the prior year in which waitlisted projects may

have originally applied).

Additional information on project qualification for these categories, including definitions and criteria

applicable to “public schools,” “community-driven community solar,” and “equity eligible

contractors,” can be found in Chapter 7. That Chapter also outlines what selection criteria will be

applied to select community-driven community solar projects.

The law also provides that the Adjustable Block Program shall ensure that RECs are procured from

“projects in diverse locations and are not concentrated in a few geographic areas.”

The Agency has

spent time reviewing the geographic distribution of projects supported thus far through the

Adjustable Block Program and has found that the Program generally features very strong geographic

diversity. Some exceptions certainly exist – for instance, while community solar projects facilitated

through the program look well-dispersed on a map of the state, development has almost exclusively

occurred in less populated rural areas featuring lower land cost – but the IPA has generally been

pleased with the degree to which the tens of thousands of projects supported to date through the

Adjustable Block Program more broadly demonstrate geographic diversity.

Moving forward, the Agency commits to continue monitoring the locations of proposed and

completed projects. The Agency publishes a map on its Adjustable Block Program website providing

a visual display of project location by zip code,

and in recognition of increased interest in

This category shall open “[s]tarting in the third delivery year after the effective date of this amendatory Act of the 102nd General

Assembly or earlier if the Agency determines there is additional capacity needed for to meet previous delivery year requirements.” 20

ILCS 3855/1-75(c)(1)(K)(iii).

The Agency may also create subcategories within this category to account for the differences between project size or location, and

projects located within environmental justice communities or within Organizational Units that fall within Tier 1 or Tier 2 shall be given

priority.

20 ILCS 3855/1-75(c)(1)(K).

20 ILCS 3855 1/75(c)(1)(K).

See: https://illinoisabp.com/project-map/.

Illinois Power Agency 2022 Long-Term Plan (Final) August 23, 2022

monitoring the location (and program compliance) of supported projects, is planning a comment

process for publishing additional information on project location. Further discussion of the

geographic diversity of Adjustable Block Program projects is found in Chapter 7.

2.8.1.2. Adjustable Block Program—Contracts

Section 1-75(c)(1)(L) sets forth certain requirements applicable to REC delivery contracts entered

into through the Adjustable Block Program, with those requirements having been modified

extensively through P.A. 102-0662. In accordance with changes in law and depending on ABP

category, the delivery term for a REC delivery contract may now be 15 years or 20 years in length.

As the Buyer counterparty, payment for RECs is made by (and RECs are delivered to) the applicable

electric utility (which must then retire the RECs), and payment must occur according to the following

schedule:

• For DG systems of no more than 25 kW, the full contract value “shall be paid in full, based on

the estimated generation during the first 15 years of operation” upon verification by the

Program Administrator of energization.

The contract length (delivery term) of these

contracts is 15 years.

• For both large DG systems (more than 25 kW but less than 5MW) and community-driven

community solar projects, 15% of the contract value shall be paid upon verification of

energization by the program administrator, with the remaining portion “paid ratably over

the subsequent 6-year period. The contract length (delivery term) of these contracts is

likewise 15 years.

• For both the non-community driven (traditional) community solar projects and public school

projects, “the renewable energy credit delivery contract length shall be 20 years and shall be

paid over the delivery term, not to exceed during each delivery year the contract price

multiplied by the estimated annual renewable energy credit generation amount.”

This

“paid-upon-delivery” structure resembles utility-scale contracts more so than prior ABP

contracts.

• For the equity eligible contractor category, the payment terms applicable to the category in

which the system would otherwise fall generally apply. For example, a Small DG system

participating in the equity equitable contractor block would receive a 15-year REC delivery

contract with full payment upon energization. However, contracts under the equity eligible

contractor category may also feature a payment structure through which “applicant firms are

advanced capital disbursed after contract execution but before the contracted project's

energization” based on a demonstration of qualification or need.

This capital advancement

would not serve to increase the overall contract value, but would allow prepayment of a share

of expected contract revenues to assist with predevelopment activities. Qualification

20 ILCS 3855/1-75(c)(1)(L)(ii). The Agency understands this provision to mean that a system of exactly 25 kW in size would be included

in this category.

All prepayment remains subject to the amounts collected by the utilities under its Section 16-108(k) tariffs, however, and other available

funds (such as alternative compliance payments). (See Section 1-75(c)(1)(L)(vii)).

20 ILCS 3855/1-75(c)(1)(L)(iii).

20 ILCS 3855/1-75(c)(1)(L)(iv).

20 ILCS 3855/1-75(c)(1)(K)(vi).

Illinois Power Agency 2022 Long-Term Plan (Final) August 23, 2022

requirements for pre-energization capital and the amount or percentage of pre-energization

capital available to qualified applicants is outlined in Chapter 7.

Prepayment poses unique challenges. While RECs are required to be delivered when generated to

meet annual utility compliance obligations, prepayment reduces the incentive to actually deliver

RECs. On this point, the law requires that each contract “shall include provisions to ensure the

delivery of the estimated quantity of renewable energy credits and ongoing collateral requirements

and other provisions deemed appropriate by the Agency.”

This Plan’s approach to Adjustable Block Program contracts generally, as well as to the clawback

provisions, collateral requirements and other contract elements intended to ensure REC delivery, can

be found in Chapter 7.

2.8.1.3. Adjustable Block Program—Midstream Changes

Unlike a competitive procurement process, through which changes in market conditions may be

reflected in bidders’ bids, the Adjustable Block Program requires that the Agency project future

market conditions through establishing annual block sizes and prices.

The law envisions these changes occurring in two ways: first, the Agency “may periodically review

its prior decisions establishing the amount of generation capacity in each block, and the purchase

price for each block, and may propose, on an expedited basis, changes to these previously set values”

subject to the Section 16-111.5 plan revision process.

100

Second, “[p]rogram modifications to any block price that do not deviate from the Commission's

approved value by more than 10% shall take effect immediately and are not subject to Commission

review and approval.”

101

To prevent the requirement that the Agency seek formal administrative

approval for large modifications from being effectively ignored, the Agency believes this threshold

should be understood as a 10% change based on the last formally approved (i.e., through revision of

the Plan via Commission’s Section 16-111.5 approval process) price for that particular annual block.

Section 1-75(c)(1)(M) of the Act requires that the Agency “consider stakeholder feedback when

making adjustments to the Adjustable Block design” and “notify stakeholders in advance of any

planned change.” Likewise, the law requires that “[t]he Agency and its consultant or consultants shall

monitor block activity, share program activity with stakeholders and conduct quarterly meetings to

discuss program activity and market conditions.” In implementing the program, the Agency has to

date attempted to seek stakeholder feedback for the development of key program requirements or

new forms and documents; such documents are published on the program website

(www.illinoisabp.com) and new requirements are incorporated into the Adjustable Block Program

Guidebook.

102

The program website also features a program dashboard updated daily to provide

stakeholders with daily data on block activity,

103

project information spreadsheets to provide

20 ILCS 3855/1-75(c)(1)(L)(v).

100

20 ILCS 3855/1-75(c)(1)(K).

101

20 ILCS 3855/1-75(c)(1)(M).

102

Both the presently effective Guidebook and prior editions of the Guidebook can be found here: http://illinoisabp.com/program-

guidebook.

103

The Adjustable Block Program dashboard can be found here: https://illinoisabp.com/block-capacity-dashboard-2/.

Illinois Power Agency 2022 Long-Term Plan (Final) August 23, 2022

increased transparency about photovoltaic projects supported through the Adjustable Block

Program,

104

and a map of projects supported through the program to date.

105

2.8.1.4. Adjustable Block Program—Consumer Protection

In its Initial Plan, the Agency proposed and the Commission approved several consumer protection

measures constituting terms, conditions, and requirements for the receipt of state-administered

incentive funds under the Adjustable Block Program and Illinois Solar for All Program. The Agency

then developed an Approved Vendor registration and approval process, standardized disclosure

forms, a standardized program brochure, minimum contract requirements, and marketing

requirements across 2017 and 2018, with those items updated periodically since.

Revisions made to Section 1-75(c)(1)(M) of the Act now memorialize, reinforce, and expand the

Agency’s consumer protection responsibilities. In addition to those items proposed through this

Long-Term Plan or developed thereafter, these new-to-statute terms, conditions, and requirements

include the following:

(i) A registration process for entities seeking to qualify for program-administered incentive

funding and baseline qualifications for vendor approval, with a list of approved entities on

each program's website. The agency may also revoke a vendor's ability to receive program-

administered incentive funding upon a determination that the vendor failed to comply with

contract terms, the law, or other program requirements.

(ii) Program requirements and minimum contract terms to ensure projects are properly

installed and produce their expected amounts of energy, including on-site inspections and

photo documentation. The Agency may require repairs, alterations, or additions to remedy

any material deficiencies discovered, and bar Approved Vendors with a disproportionately

high number of deficient systems from program participation.

(iii) Standardized disclosures to a customer prior to that customer's execution of a contract

for the development of a distributed generation system or a subscription to a community

solar project.

(iv) Establishment of Consumer Complaints Centers to accept complaints connected with

the programs and a public database of complaints.

(v) An annual written report to the ICC documenting the frequency and nature of complaints

and any enforcement actions taken in response to those complaints.

(vi) Regular meetings with the Office of the Attorney General, the ICC, consumer protection

groups, and other interested stakeholders regarding consumer protection matters.

(vii) Referrals of complaints to the Office of the Attorney General, the Illinois Commerce

Commission, or local, State, or federal law enforcement where appropriate.

As the requirement to establish these consumer protection items applies to the “program

administrators for both the Adjustable Block program and the Illinois Solar for All Program,” the

Agency understands these items to be minimum statutory consumer protection requirements

104

Project application disclosure information can be found here: http://illinoisabp.com/project-information-disclosure-process.

105

The ABP project map can be found here: https://illinoisabp.com/project-map/.

Illinois Power Agency 2022 Long-Term Plan (Final) August 23, 2022

applicable to the Illinois Solar for All Program as well. The additional requirements found in Section

1-56(b) for ILSFA projects, sites, applicants, and customers create consumer protection

requirements for the Illinois Solar for All Program beyond those applicable to the ABP.

2.8.2. Community Renewable Generation Projects

Section 1-75(c)(1)(N) as modified by P.A. 102-0662 requires that the Agency “establish the terms,

conditions, and program requirements for photovoltaic community renewable generation projects

with a goal to expand renewable energy generating facility access to a broader group of energy

consumers, to ensure robust participation opportunities for residential and small commercial

customers and those who cannot install renewable energy on their own properties.”

106

While only

solar community renewable generation projects are supported through the Adjustable Block

Program, Section 1-75(c)(1)(N) allows the IPA to “consider whether community renewable

generation projects utilizing technologies other than photovoltaics should be supported through

State-administered incentive funding” and the Agency “may issue requests for information to gauge

market demand.”

Additional considerations applicable to community renewable generation projects and subscriptions

are outlined below.

2.8.2.1. Portability and Transferability of Subscriptions

Section 1-75(c)(1)(N) provides that “subscriptions” to community renewable generation projects

must be portable (i.e., retained by the subscriber even if the subscriber relocates within the same

utility service territory) and transferable (i.e., a subscriber may assign or sell subscriptions to

another person within the same utility service territory).

During the implementation of the Adjustable Block Program, some entities have raised questions

regarding the scope of the portability and transferability of community solar subscriptions. It seems

clear that the law did not envision completely unconditional portability or transferability: if a

resident holding a community solar subscription were to move from a large house to a small

apartment, the resultant drop in energy consumption may necessitate downsizing the subscription.

Likewise, a transferee may be an unworkable recipient of an existing subscriber’s community solar

subscription for many reasons, from being legally ineligible (outside of that utility’s service territory)

to posing a more significant non-payment risk than the transferor. At the same time, allowing

unbounded Approved Vendor-imposed restrictions on portability or transferability could defeat the

spirit of the law’s requirement that subscriptions be portable and transferable.

Through revisions to Section 1-75(c)(1)(N) provided by P.A. 102-0662, the law clarifies that these

concepts shall be “subject to reasonable limitations.” As additional projects energize and begin to

cycle through subscribers, the Agency hopes to learn more about what considerations should inform

the parameters of portability and transferability requirements.

2.8.2.2.

Opt-Out Municipal Aggregation

Certain stakeholders have raised the question of whether community renewable generation project

subscriptions (specifically, community solar subscriptions) may be eligible for execution via opt-out

106

20 ILCS 3855/1-75(c)(1)(N).

Illinois Power Agency 2022 Long-Term Plan (Final) August 23, 2022

municipal aggregation authorized under Section 1-92 of the IPA Act. Under opt-out municipal

aggregation, municipalities (after passing authorizing referenda) may aggregate their residential and

small commercial customer load and contract with an alternative retail electric supplier to supply

those customers with “energy and related services” at a negotiated supply rate unless that customer

expressly chooses to “opt-out” of the transaction.

For the IPA, in its role as the entity charged with administering the Adjustable Block Program and

Illinois Solar for Program, this raises, at minimum, two questions:

First, is the enrollment of a customer into a subscription for a community solar project without their

direct authorization or consent (i.e., on an “opt-out” basis) legally authorized by Section 1-92 of the

IPA Act’s governmental aggregation provisions?

Second, even if legally authorized, would that relieve Approved Vendors from program-related

responsibilities with respect to individual subscribers, including the requirement that each customer

complete a disclosure form acknowledging participation in the program?

As to the first question, the IPA is highly skeptical that opt-out municipal aggregation could legally

cover community solar subscriptions, which were not contemplated anywhere in Illinois law when

Section 1-92 was enacted via Public Act 96-0176 in 2009 (and notes that countless implementation

issues would be raised under such an approach).

107

However, only the second of these questions falls

within the scope of this Plan. On that question, the Agency’s disclosure form requirements discussed

above, and now expressly required under changes to Section 1-75(c)(1)(M) of the Act, are

fundamental to subscribers receiving standardized information. Those requirements constitute the

backbone of the Agency’s efforts to deliver uniform content about the rights and obligations under a

ratepayer-funded program to everyday citizens. That standardized information and express

acknowledgment by a subscriber is an essential form of education that must be provided to each

individual participant to produce a transparent, positive experience in IPA programs. Thus, even if

some colorable argument could be made that community solar subscribers could be enrolled without

each individual subscriber providing direct consent to a given subscription, the Agency would not

waive its program-specific consumer protection requirements—including its standardized brochure

and the receipt and execution of a disclosure form.

In Docket No. 19-0995, the Illinois Commerce Commission agreed, determining that any community

solar subscription aggregation program (if legally possible) for a project participating in the ABP or

ILSFA would be required to ensure that every individual subscriber receives and executes an

individualized standard disclosure form.

108

The Commission likewise agreed with the Agency that

the question of whether opt-out municipal aggregation for community solar subscriptions is legally

authorized under Section 1-92 of the IPA Act is an issue outside the scope of Plan approval, finding

that “this proceeding is not the forum for the Commission to decide the legality of opt-out municipal

aggregation for community solar subscriptions, as numerous interested stakeholders - such as the

107

Any community renewable generation project that does not participate in an IPA-administered program or procurement may freely

operate outside of this Plan’s requirements. However, given the Agency’s express statutory role (separate from its role administering

renewable resources programs under this Plan) assisting governmental aggregation programs under Section 1-92(g) of the Act, the

Agency’s perspective should carry advisory authority.

108

Docket No. 19-0995, Final Order dated Feb. 18, 2020 at 7.

Illinois Power Agency 2022 Long-Term Plan (Final) August 23, 2022

many municipalities that might be interested and the private brokers that might assist them in

soliciting bids - would not be on notice that the issue is being decided.”

109

2.9. Illinois Solar for All Program

As described in Section 1-56(b) of the IPA Act, the Illinois Solar for All Program “provides incentives

for low-income distributed generation and community solar projects, and other associated approved

expenditures” in order “to bring photovoltaics to low-income communities in this State in a manner

that maximizes the development of new photovoltaic generating facilities, to create a long-term, low-

income solar marketplace throughout this State, to integrate, through interaction with stakeholders,

with existing energy efficiency initiatives, and to minimize administrative costs.” Further, the

program shall be “designed to grow the low-income solar market.”

110

The Program shall also “maximize efficiencies and synergies available through coordination with

similar initiatives, including the Adjustable Block program . . . energy efficiency programs, job

training programs, and community action agencies.” The Agency shall strive to ensure that support

is provided to “projects across the breadth of low-income and environmental justice communities in

Illinois, including both urban and rural communities,” and “not concentrated in a few communities”

or excluding any “particular low-income or environmental justice communities.”

A statutory overview of the Illinois Solar for All Program (which began accepting project applications

on May 15, 2019), as well as the individual sub-programs under the Illinois Solar for All banner, is

below.

2.9.1. Illinois Solar for All—Overview

At its core, the Illinois Solar for All Program is an incentive program—through more generous REC

prices, the Illinois Solar for All Program incents low-income (as well as non-profit and public facility)

participation in solar photovoltaic projects, whether as a system owner, community solar project

subscriber, or system host. Those RECs are retired by the counterparty Buyer (either the Agency or

a utility) to satisfy Section 1-75(c) compliance obligations just as with the other procurements and

programs described above, while the additional premium helps grow the low-income solar

marketplace and ensure more equitable access to the benefits of clean energy. Thus, structurally, the

law envisions the Solar for All Program’s incentive being offered through contracts for the delivery

of RECs at a premium price, supplying the higher incentive necessary to ensure low-income

participation. The Agency also may offer full contract prepayment or otherwise relax (or enhance)

requirements in recognition of the unique challenges facing low-income project development.

While the program features no hard targets or goals for the quantity of RECs procured, it does feature

defined funding sources. First, Illinois Solar for All is funded through the Renewable Energy

Resources Fund. At the time of finalization of this Plan (August 2022), the balance of the RERF was

$128.9 million. The $108.5 million balance of funds that had been transferred to the state’s General

Revenue Fund ($98.5 million) and Health Insurance Reserve Fund ($10 million) for liquidity

purposes was fully repaid by late March 2022. The IPA considers any contractual obligations from

the RERF pre-dating Illinois Solar for All (specifically, Supplemental Photovoltaic Procurement

contracts) to be senior to any new obligations entered into through the Illinois Solar for All

109

Id.

110

20 ILCS 3855/1-56(b)(2).

Illinois Power Agency 2022 Long-Term Plan (Final) August 23, 2022

Program,

111

and as of August 2022, approximately $2.5 million in such prior obligations remain

outstanding.

112

No additional Alternative Compliance Payments are due to be made into the RERF.

Second, Illinois Solar for All is funded through a portion of funds collected by the utilities under their

Section 16-108(k) RPS tariffs for purchases made under Section 1-75(c) of the IPA Act. Under Section

1-75(c)(1)(O) as revised by P.A. 102-0662, the Plan “shall allocate up to $50,000,000 per delivery

year to fund the programs, and the plan shall determine the amount of funding to be apportioned to

the programs.” This $50 million cap constitutes a nearly five-fold increase from the utility collections

previously authorized to support the ILSFA Program. For the delivery years beginning June 1, 2021,

June 1, 2022, and June 1, 2023, that total amount may be reached by averaging, such that a lower

budget in an earlier year could be made up for through a larger budget in a later year. Every three

years, an additional $10,000,000 shall also be provided to DCEO to implement workforce

development programs authorized under Section 16-108.12 of the PUA; this also constitutes a

change, as that funding had previously been allocated to ComEd for those programs (and on four-

year intervals).

Under the Illinois Solar for All Program, payments “shall be in exchange for all renewable energy

credits generated by the system during the first 15 years of operation and shall be structured to

overcome barriers to participation in the solar market by the low-income community.”

113

The

contract “may pay for such renewable energy credits through an upfront payment per installed

kilowatt of nameplate capacity paid once the device is interconnected at the distribution system level

of the interconnecting utility and verified as energized,” giving the Agency flexibility in proposing

contract structures.

114

The counterparty to Illinois Solar for All contracts executed using RERF funds is the Agency, while

the counterparty to contracts executed using utility funds is the applicable utility.

While the Act does not require an annual RERF budgetary allocation to ILSFA, the Agency continues

to propose to allocate funds and consider project applications based on “program years,” which track

the same period of time as energy delivery years (June 1st of one year to May 31st of the following

year). The Agency’s budget allocations by program year are described in detail in Chapter 8.

In addition to payments for REC delivery contracts, the law provides that “[t]he Agency shall direct

up to 5% of the funds available under the Illinois Solar for All Program to community-based groups

and other qualifying organizations to assist in community-driven education efforts related to the

Illinois Solar for All Program.” Authorized grassroots education activities include “general energy

education, job training program outreach efforts,” and “other activities deemed to be qualified by the

Agency,” but “shall not be used to support the marketing by solar project development firms and

organizations, unless such education provides equal opportunities for all applicable firms and

organizations.”

115

Notably, for grassroots education efforts this amount is not based only on the

111

This appears to be the intent evident in Section 1-56(b) as well, as that section prefaces the percentage-based allocation of RERF funds

with the qualifier “monies available in the Illinois Power Agency Renewable Energy Resources Fund and not otherwise committed to

contracts executed under subsection (i) of this Section.” (emphasis added)

112

Supplemental Photovoltaic Procurement contracts were for the delivery of RECs for 5 years, with payment for RECs made upon delivery;

the procurement’s original budget was $30 million.

113

20 ILCS 3855/1-56(b)(3).

114

Id.

115

Id.

Illinois Power Agency 2022 Long-Term Plan (Final) August 23, 2022

balance of the RERF; it is instead “up to 5% of the funds available under the Illinois Solar for All

Program,” and thus also inclusive of any Section 1-75(c) or 16-108(k) funds. In implementation, the

Agency has decided to award grassroots education contracts through a competitive RFP process, with

those entities serving as subcontractors to the Agency’s Illinois Solar for All Program Administrator

and performing grassroots education activities under that master contract.

116

In addition to grassroots education, “costs associated with procuring experts, consultants, and the

program administrator . . . and related incremental costs, costs related to income verification and

facilitating customer participation in the program, and costs related to the evaluation of the Illinois

Solar for All Program” may be paid out of the RERF.

117

New proposals for how best to leverage

grassroots education funding for solving barriers to ISLFA participation can be found in Chapter 8.

2.9.2. Illinois Solar for All—Sub-programs

Illinois Solar for All is designed to support specific defined project types, and to this end, Illinois Solar

for All features four sub-programs with percentage-based funds allocations applicable to each. As

clarified through P.A. 102-0662, these percentages apply to both support from the RERF and from

utility collections, although these allocations are merely initial percentages and may be altered “if the

Agency, after receiving input through a stakeholder process,” determines that any individual sub-

program has not been adequately subscribed to fully utilize ILSFA funds.

For the purposes of this Plan subsection, an individual sub-program may be referred to as a

“program” (as is done within Section 1-56(b)(2) of the Act) or a “sub-program” (which is more

intuitive, as these programs are programs within the Illinois Solar for All Program). Regardless of

verbiage, each constitutes an initiative operating inside the Illinois Solar for All Program structure

and is subject to its general requirements, including Approved Vendor qualification requirements,

but with separate program year budgets and project application requirements

In addition to these four sub-programs, the Agency or a party may propose additional sub-programs

through this Long-Term Plan. Such new programs “may target market segments not specified above

and may also include incentives targeted to increase the uptake of nonphotovoltaic technologies by

low-income customers, including energy storage paired with photovoltaics”—but only if “the

Commission determines that the Illinois Solar for All Program would provide greater benefits to the

public health and well-being of low-income residents through also supporting that additional

program versus supporting programs already authorized.”

118

Through P.A. 102-0662, the Low-Income Community Solar Pilot Project Program was struck from

Section 1-56(b) (previously subparagraph (D)), while a new Low-Income Large Multifamily Solar

Incentive Program took its place (within subparagraph (E)). REC delivery contracts, program

requirements, and statutory requirements applicable to projects having successfully participated

under subparagraph (D) remain in effect, but the Agency may no longer conduct additional Low-

Income Community Solar Pilot Project procurements.

116

More information on the Illinois Solar for All grassroots education process can be found here:

https://www.illinoissfa.com/grassroots-education and in Section 8.15.5.

117

20 ILCS 3855/1-56(b)(3).

118

20 ILCS 3855/1-56(b)(4).

Illinois Power Agency 2022 Long-Term Plan (Final) August 23, 2022

2.9.2.1. Low-Income Single-Family and Small Multifamily Solar Incentive

The Low-Income Single-Family and Small Multifamily Solar Incentive sub-program “provide[s]

incentives to low-income customers, either directly or through solar providers, to increase the

participation of low-income households in photovoltaic on-site distributed generation at residential

buildings containing one to 4 units.”

119

Used for this sub-program and others, the term “solar

provider” has no definition in the statute; to allow the market to determine appropriate models, the

Agency has determined that “solar providers” can refer to any entity which has a contractual

relationship with the low-income customer in connection with the underlying photovoltaic system

(whether in the form of purchase, leasing, installation, aggregation, or financing).

The law also requires that “an administrator shall facilitate partnering the companies that install

solar panels with entities that provide solar panel installation job training.”

120

The IPA understands

this to mean its third-party Program Administrator engaging in such facilitation, and this is presently

part of the ILSFA Program Administrator’s scope of work.

The IPA Act also includes a provision that “[c]ontracts entered into under this paragraph may be

entered into with an entity that will develop and administer the program.”

121

It is unclear how the

administrator could leverage state funds for this use, and at present, all such contracts will be entered

into between Approved Vendors (Sellers) and the State of Illinois or a participating utility (Buyers).

Through P.A. 102-0662, this sub-program also now contains extensive support for projects that

demonstrate energy sovereignty (see Section 2.9.3.3 below), which is intended to support

“ownership of projects by low-income households, not-for-profit organizations providing services to

low-income households, affordable housing owners, community cooperatives, or community-based

limited liability companies providing services to low-income households” that “ensure that local

people have control of the project and reap benefits from the project over and above energy bill

savings.” Program and contract requirements may be developed to ensure faithful compliance with

these objectives by entities benefitting from additional energy sovereignty support (whether through

reserved program capacity or higher REC prices). Additional discussion of energy sovereignty can

be found below, in Chapter 8, and in Appendix G.

The Agency shall also “make every effort” to ensure that ABP solar providers can “easily participate

in this program.” According to Section 1-56(b)(2)(A)(ii) such efforts could include “utilizing similar

or the same application systems and processes, similar or the same forms and formats of

communication, and providing active outreach to companies participating in one program but not

the other.” The Agency’s strategies for encouraging increased participation in the two low-income

distributed generation sub-programs can be found in Chapter 8.

Along with the Low-Income Large Multifamily Solar Incentive Program, these two sub-programs are

allocated 35% of available funds.

119

20 ILCS 3855/1-56(b)(2)(A).

120

Id.

121

Id.

Illinois Power Agency 2022 Long-Term Plan (Final) August 23, 2022

2.9.2.2. Low-Income Community Solar Project Initiative

Through the Low-Income Community Solar Project Initiative, “[i]ncentives shall be offered to low-

income customers, either directly or through developers, to increase the participation of low-income

subscribers of community solar projects.”

122

Again, the term “developer” is undefined in the law. As

community solar project subscriptions may be actively marketed by entities other than the

photovoltaic project “developers,” no guidance is provided as to whether this phrasing is intended to

include all entities marketing such subscriptions or only the project’s actual developer.

The program requires that each participating project’s developer “shall identify its partnership with

community stakeholders regarding the location, development, and participation in the project.”

123

Undefined in this phrasing is what constitutes a “community stakeholder,” or whether the project

itself must include “community stakeholders” from the community in which the project is located

(presumably so), the community of any subscribers (unclear), or both (also unclear).

Pre-P.A. 102-0662 statutory language stating that “[i]ncentives should also be offered to community

solar projects that are 100% low-income subscriber owned, which includes low-income households,

not-for-profit organizations, and affordable housing owners” has been struck from the law and

replaced by energy sovereignty language found elsewhere Section 1-56(b)(2);

124

the Agency’s

approach to energy sovereignty under the ILSFA Program is discussed more extensively below, in

Chapter 8, and in Appendix G.

The law also provides that “[c]ontracts entered into under this paragraph may be entered into with

developers,”

125

which the IPA has interpreted to mean that a project developer, upon a sufficient

showing of low-income participation, may qualify for a contract award.

This sub-program is allocated 40% of available funding.

2.9.2.3. Incentives for Non-profits and Public Facilities

The third Illinois Solar for All sub-program provides that funding “shall be used to support on-site

photovoltaic distributed renewable energy generation devices to serve the load associated with not-

for-profit customers and to support photovoltaic distributed renewable energy generation that uses

photovoltaic technology to serve the load associated with public sector customers taking service at

public buildings.”

126

Stated differently, the program operates similarly to the first sub-program—an

incentive for on-site DG through a higher-priced REC contract—only with different eligibility

requirements (not-for-profit customers and public sector customers taking service at public

buildings).

This limited statutory guidance raises the question of whether all non-profits and all public sector

entities may qualify for the sub-program, or whether some nexus with the broader “low-income”

intent of Illinois Solar for All is required. As discussed further in Chapter 8, the IPA believes that

122

20 ILCS 3855/1-56(b)(2)(B).

123

Id.

124

Id.

125

Id.

126

20 ILCS 3855/1-56(b)(2)(C).

Illinois Power Agency 2022 Long-Term Plan (Final) August 23, 2022

some level of community involvement may be required to maintain consistency with the spirit of the

law.

127

This sub-program also combines referenced elements of each of the prior programs, stating that

“[c]ontracts may be entered into with an entity that will develop and administer the program or with

developers,”

128

which carries similar challenges to those referenced above.

This sub-program is allocated 25% of available funding.

2.9.2.4. Low-Income Large Multifamily Solar Incentive

The fourth sub-program, now outlined through subparagraph (E) to Section 1-56(b), is the Low-

Income Multifamily Solar Incentive. This sub-program provides incentive funding “to low-income

customers, either directly or through solar providers, to increase the participation of low-income

households in photovoltaic on-site distributed generation at residential buildings with 5 or more

units.” This new sub-program in one sense replaces the Low-Income Community Solar Pilot Project

program previously offered under subparagraph (D), but can also be viewed as an expansion of the

previous Low-Income Distributed Generation Incentive program—with that program now split into

two separate sub-programs for residential projects (one single family/small multifamily; one large

multifamily).

Additional requirements applicable to this new multifamily building subprogram include job trainee,

energy sovereignty, and environmental justice community requirements discussed further below.

Along with the Low-Income Single Family and Small Multifamily Solar Incentive Program outlined in

subparagraph (A), these two sub-programs are allocated 35% of available funds.

2.9.3. Illinois Solar for All—Additional Requirements

Section 1-56(b) also provides that, under Illinois Solar for All, “[e]ach contract that provides for the

installation of solar facilities shall provide that the solar facilities will produce energy and economic

benefits, at a level determined by the Agency to be reasonable, for the participating low income

customer.”

129

The Agency believes that this requirement is in part met through the premium attached

to the REC price under Illinois Solar for All (and “energy benefits” for community solar and

distributed generation projects are already handled though bill crediting and net metering provisions

over which the Agency lacks jurisdiction), and provides support for consumer protections to ensure

that low income customers indeed receive benefits in entering into contractual arrangements with

installers, project developers, aggregators, or other intermediaries. Those specific requirements are

discussed in more detail in Chapters 8 and 9.

Illinois Solar for All contracts must also “ensure the wholesale market value of the energy is credited

to participating low-income customers or organizations,”

130

which, again, is an issue handled through

net metering, but can be emphasized in resulting contracts. Contracts must also ensure that “tangible

economic benefits flow directly to program participants, except in the case of low-income multi-

127

More information on what is presently required from qualifying non-profits and public facilities can be found here:

https://www.illinoissfa.com/programs/nonprofit-organizations-and-public-agencies.

128

Id.

129

20 ILCS 3855/1-56(b)(2).

130

Id.

Illinois Power Agency 2022 Long-Term Plan (Final) August 23, 2022

family housing where the low-income customer does not directly pay for energy.”

131

While the law

does not define “tangible economic benefit” (or, for that matter, a “program participant”), the Agency

will continue to require, consistent with the Commission Order approving the Initial Plan,

132

that

ongoing annualized payments by the customer (if any) must be less than 50% of the annual first year

estimated production and/or utility default service net metering value to be received by the

customer. The tangible benefits language also provides further reason to ensure that marketing

practices are standardized such that low-income customers receive clear, standardized information

about the benefits to be expected from an Illinois Solar for All project.

The law also directs that priority to be given to projects that “demonstrate meaningful involvement

of low-income community members in designing the initial proposal.”

133

Here again, the law provides

no definition of “meaningful involvement” nor does it define a “low-income community member,”

and it is unclear whether this would be distinct from an “environmental justice community” or what

constitutes a community “member.” The law further provides that “[a]cceptable proposals to

implement projects must demonstrate the applicant's ability to conduct initial community outreach,

education, and recruitment of low-income participants in the community;” again, the term

“participants in the community” is undefined and entirely unclear, but the Agency does understand

this language as providing that entities seeking to market installations or community solar

subscriptions using Illinois Solar for All contracts must, at a minimum, be certified by the Agency and

possess some baseline level of demonstrated competency. The Agency’s approach to vendor

certification through its Approved Vendor process is discussed further in Chapters 7 and 8.

2.9.3.1. Environmental Justice Communities

All four sub-programs also contain “a goal . . . that a minimum of 25% of the incentives for this

program be allocated to community photovoltaic projects in environmental justice communities.”

134

Through changes to Illinois law made by P.A. 102-0662, other programs and state agencies now rely

on this “environmental justice community” definition for their determinations of program and

funding eligibility.

The Agency’s definition of the term “environmental justice community” is discussed further in

Chapter 8 and, at present, is described more comprehensively on the Illinois Solar for All website,

which allows for users to search qualification status by address.

135

2.9.3.2. Trainee Requirements

As growing the low-income solar market involves more than just REC delivery contracts making

photovoltaics more affordable, the law also requires that projects “include job training opportunities

if available,” and provides that such job training opportunities should occur through coordination

with the job training programs proposed in the Workforce Development Plan produced through

Section 16-108.12 of the PUA and through the Energy Transition Act.

131

Id.

132

Docket No. 17-0838, Final Order dated April 3, 2018 at 150-151.

133

20 ILCS 3855/1-56(b)(2).

134

20 ILCS 3855/1-56(b)(2)(A), (B), (C), and (E).

135

See: https://www.illinoissfa.com/environmental-justice-communities.

Illinois Power Agency 2022 Long-Term Plan (Final) August 23, 2022

Through P.A. 102-0662, Section 1-56(b)(2) now requires that, for all sub-programs, “the specific level

of trainee usage” is to be determined through the Long-Term Plan. Previously, a baseline minimum

level of trainee usage applied only to the Low-Income Distributed Generation subprogram; through

this change the IPA understands Section 1-56(b)(2) to now require minimum trainee usage levels for

all four sub-programs (with the availability for waivers where appropriate), and not only for the

subprogram referenced within subparagraph (A) (the scope of which has itself now changed).

The Agency’s approach to encouraging that projects use job trainees to help build the low-income

solar marketplace is discussed further in Chapter 8.

2.9.3.3.

Energy Sovereignty

New language found throughout Section 1-56(b)(2) is intended to encourage participation from

more project proposals which demonstrate “energy sovereignty,” which is not defined by the statute.

Express language requiring support for projects that facilitate energy sovereignty can be found in

subparagraphs (A), (B), and (E); subparagraph (C) includes language about necessary safeguards

through program and contract requirements, but not specific language about providing support for

projects demonstrating energy sovereignty (and from a public policy perspective, the energy

sovereignty concept would appear to be a less acute concern for non-profits and public facilities).

As the Agency understands it, the primary objective in providing dedicated support for projects that

promote energy sovereignty is to ensure wealth-building for low-income communities. Energy

sovereignty allows program participants to access project benefits above and beyond the financial

savings and other direct benefits that more detached participation may offer to low-income Illinois

residents. Section 1-56(b)(2) envisions two primary means for promoting energy sovereignty: 1)

dedicated portions of a sub-program budget reserved for projects that promote energy sovereignty;

and 2) heightened incentive levels (i.e., higher REC prices) for projects that promote energy

sovereignty. Given the full prepayment model used for ILSFA REC delivery contracts coupled with

the reality that accomplishing energy sovereignty may entail confirmation of progress well after the

project’s energization, certain subparagraphs within Section 1-56(b)(2) also expressly reference

“additional program and contract requirements to ensure faithful compliance” with energy

sovereignty standards.

Appendix G contains an analysis of the energy sovereignty concept, including what businesses

models could be utilized to accomplish energy sovereignty and how those and other models may

work within individual ILSFA sub-programs. Additional discussion of energy sovereignty

requirements for Illinois Solar for All sub-programs can be found in Chapter 8.

2.9.3.4. Small and Emerging Businesses

P.A. 102-0662 introduced new language into Section 1-56(b)(2) encouraging the Agency to “make

every effort to ensure that small and emerging businesses, particularly those located in low-income

and environmental justice communities, are able to participate in the Illinois Solar for All Program.”

This language provides no definition for what constitutes a “small” or “emerging” business, but does

list activities that would constitute such efforts: proactive support from the program administrator;

different or preferred access to subprograms and administrator-identified customers or grassroots

education provider-identified customers, and different incentive levels. This Plan’s approach to

supporting small and emerging businesses under Illinois Solar for All can be found in Chapter 8.

Illinois Power Agency 2022 Long-Term Plan (Final) August 23, 2022

This new language contains a reporting requirement, through which the IPA “shall report on progress

and barriers to participation of small and emerging businesses in the Illinois Solar for All Program at

least once a year.” That report must be made available on the IPA’s website and included with the

Long-Term Plan in applicable years.

2.9.4. Illinois Solar for All—Third-party Program Administrator

To assist the Agency in its administration of the Illinois Solar for All Program, Section 1-56(b)(5)

permits the Agency to retain a third-party program administrator (or administrators) through an

RFQ/RFP solicitation and competitive bid process. The selection criteria and requirements must

include, but are not limited to, “experience in administering low-income energy programs and

overseeing statewide clean energy or energy efficiency services.”

Through revisions to Section 1-56(b)(2)(5), Illinois law now provides that the Illinois Solar for All

program administrator “may be, but need not be, the same administrator as for the Adjustable Block

Program.” Through this Plan the Agency shall also determine “if individual subprograms of the

Illinois Solar for All Program are better served by a different or separate Program Administrator.” As

a public body, however, retention of any such new or different Program Administrators could only

be accomplished through a process otherwise consistent with state law.

In addition to the day-to-day administration of the Illinois Solar for All Program (which includes

review and approval of Approved Vendor and project applications, development and enforcement of

program requirements, development of program materials and communications, interfacing with

potential applicants, and related activities), the Program Administrator’s responsibilities now also

include the following:

• Facilitating placement for graduates of Illinois-based renewable energy-specific job training

programs, including the Clean Jobs Workforce Network Program and the Illinois Climate

Works Pre-apprenticeship Program administered by the DCEO Department of Commerce and

programs administered under Section 16-108.12 of the Public Utilities Act;

• Developing a web-based clearinghouse for information available to both job training program

graduates and firms participating, directly or indirectly, in Illinois solar incentive programs;

• Coordinating its activities with entities implementing electric and natural gas income-

qualified energy efficiency programs, including customer referrals to and from such

programs, and connecting prospective low-income solar customers with any existing

deferred maintenance programs where applicable.

In September 2018, after the conclusion of its RFQ and RFP process, the Agency contracted with

Elevate Energy (“Elevate”) to serve as the third-party program administrator for the Illinois Solar for

All Program.

2.9.5. Illinois Solar for All—Referrals

New paragraph (8) of Section 1-56(b) requires that, as part of the IPA’s Long-Term Plan development

and update, the Agency develop plans for three additional sets of referral activities:

(A) Actions to refer customers from the Illinois Solar for All Program to electric and natural gas

income-qualified energy efficiency programs, and vice versa, with the goal of increasing

participation in both programs;

Illinois Power Agency 2022 Long-Term Plan (Final) August 23, 2022

(B) Effective procedures for data sharing, as needed, to effectuate referrals between the Illinois

Solar for All Program and both electric and natural gas income-qualified energy efficiency

programs, including sharing customer information directly with the utilities, as needed and

appropriate; and

for All Program customers may be eligible and connect prospective customers for whom

deferred maintenance is or may be a barrier to solar installation to those programs.

The Agency’s approach for these activities can be found in Chapter 8.

2.10. Diversity, Equity, and Inclusion Requirements

Public Act 102-0662 created new requirements and authorities for the IPA designed to ensure

“priority access to the clean energy economy for businesses and workers from communities that have

been excluded from economic opportunities in the energy sector, have been subject to

disproportionate levels of pollution, and have disproportionately experienced negative public health

outcomes.” To advance that objective, Section 1-75 now includes five new subparagraphs.

The first element of the diversity and equity framework, Section 1-75(c-10), directs the Agency to

develop an equity accountability system, which shall include: minimum equity standards applicable

to all applicants to the Agency’s renewable energy procurements under Section 1-75(c); the Equity

Eligible Contractor category within the ABP (see Chapter 10); and “equity prioritization for

noncompetitive procurements” that advance the equity goals of the Act. All applicants for the

Agency’s renewable energy procurements must meet a new minimum equity standard, defined in the

law as “at least 10% of the project workforce for each entity” qualifying as equity eligible persons.

The law requires that this percentage increase to a statewide average of 30% by 2030, with the

annual increase in that interim determined by the Agency in this plan. The law prohibits participation

in Agency procurement programs by an approved vendor or designee that failed to meet the

minimum equity standard in the prior delivery year, and Section 1-75(c-30) provides explicit

authority for the Agency to deny participation or withhold certification as an approved vendor or

designee to enforce this standard.

Section 1-75(c-10) does not define “renewable energy procurements” as used in this section but does

specify that the 10% minimum equity standard applies to “each entity participating in a procurement

program outlined in this subsection (c-10).” Other requirements under this subsection, such as an

annual compliance plan, are only required from “each entity participating in a procurement program

of subsection (c) of this Section,” and Section 1-75(c-30) provides that the penalty for non-

compliance with (c-10) shall be to “deny the entity's ability to participate in procurement programs

in subsection (c).” The Agency therefore interprets this section as only applying to those renewable

energy procurement programs established through Section 1-75(c) of the Act, not to include the

Illinois Solar for All Program.

For competitive procurements, Section 1-75(c-10)(3) requires that the Agency “develop

requirements for ensuring that competitive procurement processes, including utility-scale solar,

utility-scale wind, and brownfield site photovoltaic projects, advance the equity goals” of the new

provisions of the Act. Specifically, the Agency shall, through this Long-Term Plan, create “bid

application requirements and a bid evaluation methodology” to ensure that applicants engage equity

eligible contractors and to optimize the amount of contract value flowing to equity eligible

contractors. Further details on this process may be found in Chapter 5. The law provides that the

10% minimum equity standard and other equity accountability requirements in Section 1-75(c-10)

also apply to entities participating in competitive procurements “to the extent practicable.” The

Illinois Power Agency 2022 Long-Term Plan (Final) August 23, 2022

Agency understands this to mean that bidders in competitive procurements will be required to file

compliance plans in a similar manner to Approved Vendors. As the concept of designees as used in

the Adjustable Block Program (to identify entities working with an approved vendor on customer-

facing activities such as sale, marketing, and installation) does not translate to the process of

developing utility-scale projects, the entity that is the bidder for the project will be responsible for

the submittal of the compliance plan.

Section 1-75(c-10)(4) creates several new requirements to be included in each revision to the long-

term renewable resources procurement plan, which can be seen in full detail in Chapter 10, all of

which provide the infrastructure to facilitate and monitor the success of the equity accountability

system. These include:

1. A mechanism for measuring and reporting project workforce profiles at the approved vendor

or designee level;

2. Training, guidance, and other support for approved vendors, designees, eligible contractors,

and other stakeholders related to the EEC category within ABP and the percentage minimum

equity standards;

3. An application process for a waiver of the minimum equity standard, which the Agency shall

grant only in “rare circumstances” where the applicant provides evidence of “significant

efforts” toward meeting the standard. Waivers are project-specific and only valid for a single

delivery year.

The second pillar of the equity provisions of P.A. 102-0662 empowers the Agency to proactively

assess and attempt to ameliorate existing racial discrimination or disparities in access to and rates

of participation in the clean energy economy. Section 1-75(c-15)(2) directs the Agency to publish a

report assessing the efficacy of the equity accountability system set out in subsection (c-10) one year

after that system is implemented. The Agency subsequently must commission and publish a racial

disparity study to “measure the presence and impact of discrimination on minority businesses and

workers in Illinois’ clean energy economy” as a whole. This study is to be conducted in collaboration

with other relevant state agencies, including the Department of Commerce and Economic

Opportunity and the Department of Labor.

As demonstrated by the required studies in subsection (c-15), P.A. 102-0662 explicitly recognizes

that “data collection, data analysis, and reporting are critical to ensure that the benefits of the clean

energy economy … are equitably distributed across the State” in Section 1-75(c-20). The third pillar

of the new diversity and equity framework directs the Agency to “collect data from program

applicants in order to track and improve equitable distribution of benefits across Illinois

communities for all procurements the Agency conducts.” Specifically, the law requires that the

Agency collect demographic and geographic data, including racial and ethnic identity, from program

applicants and participants regarding their employees, contractors, and subcontractors. Notably, the

agency must collect this information from each entity “awarded contracts under any Agency-

administered program,” which is a wider universe of entities than those subject to the minimum

equity standards, as that is limited to programs in Section 1-75(c). The Agency understands this

distinction to require that the Agency collect demographic and geographic data from applicants to

the ILSFA Program as well. That data shall be aggregated and published annually, ensuring

transparency and public accountability.

Finally, Section 1-75(c-25) establishes the fourth pillar of the diversity and equity framework: an

Energy Workforce Equity Database. This Database, to be created in consultation with the Department

of Commerce and Economic Opportunity, will facilitate the engagement of equity eligible contractors

and persons on clean energy projects by serving as an easy to use, publicly available, and “searchable

Illinois Power Agency 2022 Long-Term Plan (Final) August 23, 2022

database of suppliers, vendors, and subcontractors for clean energy industries.” This subsection also

directs the Agency to “create an easily accessible, public facing online tool using the database

information,” which the Agency understands to be a separate resource from the Energy Workforce

Equity Database, as its content is laid out in a separate subparagraph.

As described in the law, this online tool shall include a broader set of capabilities and information,

including:

1. “a map of environmental justice and equity investment eligible communities;

2. job postings and recruiting opportunities;

3. a means by which recruiting clean energy companies can find and interact with current or

former participants of clean energy workforce training programs;

4. information on workforce training service providers and training opportunities;

5. renewable energy company diversity reporting;

6. a list of equity eligible contractors;

7. reporting on outcomes of the workforce programs of the Energy Transition Act; and

8. information about the Jobs and Environmental Justice Grant Program, the Clean Energy Jobs

and Justice Fund, and other sources of capital.”

Additional features may also be considered to ensure that this online tool effectively accomplishes

desired engagement and facilitation, and the Agency plans to take additional feedback on its design.

The law does not provide a specific timeline for the Energy Workforce Equity Database or the related

online tool. The Agency will collaborate with DCEO to develop these resources in an expeditious

manner.

2.11. Self-direct Renewable Portfolio Standard Compliance Program

Also added through P.A. 102-0662 is subparagraph (R) of Section 1-75(c)(1); under this new

subparagraph, the IPA must “establish a self-direct renewable portfolio standard compliance

program for eligible self-direct customers that purchase renewable energy credits from utility-scale

wind and solar projects through long-term agreements.” Chapter 6 outlines requirements applicable

to this new self-direct program, and a brief overview of the program can be found below.

This new self-direct program has three main components of eligibility for successful participation:

customer requirements; project requirements applicable to the renewable energy project from

which that customer retires RECs or has RECs retired on its behalf; and contract requirements

applicable to the contract through which the customer receives those RECs.

A qualifying self-direct customer must be a retail customer of an Illinois electric utility with a peak

demand of at least 10,000 kilowatts. Thus, this program is intended to provide self-direct RPS

benefits back to only large customers, although customers with the same corporate parents may

aggregate account demands to meet this 10,000-kilowatt threshold.

That customer must have a contract for the delivery of RECs with a renewable energy project. That

project must be a “new” utility-scale wind or utility-scale solar project which meets the locational

requirements of Section 1-75(c)(1)(I) of the Act (or that were otherwise in place at the time of the

contract’s execution). If those contracts were entered into after the effective date of Public Act 102-

0662, that project must also meet applicable labor and diversity, equity, and inclusion requirements

that would otherwise be applicable to new utility-scale wind and utility-scale solar projects.

Illinois Power Agency 2022 Long-Term Plan (Final) August 23, 2022

Certain requirements also apply to the contract instrument itself—mainly, that it must be a long-term

contract, which Section 1-75(c)(1)(R)(2) defines as “at least 10 years” in length, and that it must “be

equivalent in volume to at least 40% of the eligible self-direct customer's usage, determined annually

by the eligible self-direct customer's usage during the previous delivery year, measured to the

nearest megawatt-hour.” This volumetric requirement may be met through multiple contracts with

qualifying new utility-scale wind or solar projects

The benefit back to a customer successfully participating in the self-direct program is a reduction in

charges levied (or “credit”) to support the RPS pursuant Section 16-108(k) of the PUA. That credit is

calculated as “the anticipated cost of renewable energy credit deliveries under contracts for new

utility-scale wind and new utility-scale solar entered for each delivery year after the large energy

customer begins retiring eligible new utility scale renewable energy credits for self-compliance.”

Notably, that credit back to participating customers cannot include “(i) costs associated with any

contracts entered into before the delivery year in which the customer files the initial compliance

report to be eligible for participation in the self-direct program, and (ii) costs associated with

procuring renewable energy credits through existing and future contracts through the Adjustable

Block Program, subsection (c-5) of this Section 1-75, and the Solar for All Program.”

136

In its Final

Order approving the Plan in Docket No. 22-0231, the Illinois Commerce Commission determined that

“a three-year rolling average of eligible utility-scale REC delivery contracts” be used to establish the

self-direct credit value.

137

Thus, Section 1-75(c)(1)(R) lacks a single known, discrete credit level back

to qualifying self-direct customers (as the cost of utility-scale contracts in future years is not yet

knowable and will change over time).

For RPS goals, targets, and budgets, Section 1-75(c)(1)(R)(3) provides that each REC procured

pursuant to the self-direct program “shall reduce the total volume of renewable energy credits the

Agency is otherwise required to procure from new utility-scale projects on behalf of contracting

utilities where the eligible self-direct customer is located.” Additionally, the “reduction in the

volumetric charges collected pursuant to Section 16-108 of the Public Utilities Act for approved

eligible self-direct customers” reduces the available RPS budget—although the amount of that

reduction is dependent on the level of the credit back to approved customers, and as outlined above,

those credit amounts will vary over time.

More information about this new self-direct program, including initial analysis on the potential

program size, can be found in Chapter 6. The self-direct RPS compliance program is scheduled to

begin receiving initial applications in February 2023, with customer participation beginning June 1,

2023.

136

20 ILCS 3855/1-75(c)(1)(R)(4).

137

Docket No. 22-0231, Final Order dated July 14, 2022 at 40.

Illinois Power Agency 2022 Long-Term Plan (Final) August 23, 2022

3. REC Portfolio, RPS Goals, Targets, and Budgets

3.1. Background

Illinois originally established the state’s Renewable Portfolio Standard in 2007 through Public Act

95-0481, which became effective on June 1, 2008. The annual percentage goals set for the RPS were

relative to the “eligible retail load,” which was defined as residential and small commercial customers

that received fixed-price bundled service from their utility rather than service from an ARES.

Beginning with the 2008-2009 delivery year, the procurement of renewable energy resources for

Illinois RPS compliance started with at least 2% of the “eligible retail load” with a targeted increase

to 25% by the 2025-2026 delivery year. Surcharges were assessed to those default supply customers

(and only those customers) to support renewable energy resource procurements intended to meet

these RPS goals.

In 2009, Public Act 96-0033 added Section 16-115D to the Public Utilities Act, which created separate

RPS obligations for ARES. ARES compliance was based on the total metered electricity delivered by

the ARES to retail customers in Illinois, but with very different compliance mechanisms as explained

in Section 2.1.3 above – namely, the payment of Alternative Compliance Payments and the self-

procurement/retirement of RECs from a broad geographic footprint.

In 2017, Public Act 99-0906 significantly revised the RPS goals by phasing out the ARES compliance

obligations over a two-year period ending on May 31, 2019 and established goals for the entire retail

customer load in Illinois (see Appendix B, Section 2.2.2.3 for more information). Just as goals now

applied to all retail customer load, so did the applicable funding mechanism – non-bypassable

charges began being levied to all retail customers, regardless of supply source, to support RPS

activities intended to meet RPS goals now applicable to all retail customer load. Likewise, these

revisions also consolidated the RPS into a single, centralized planning mechanism for procurements

and programs as described in this Plan.

In 2021, with the enactment of Public Act 102-0662 on September 15, 2021, the Illinois RPS was

further revised and expanded through changes including new RPS goals increasing by 3% each year

after the 2025-2026 delivery year (by which “25% by 2025” would be reached) to reach 40% by the

2030-2031 delivery year and a further goal to reach 50% by the 2040-2041 delivery year. These

percentages reflect the amount of RECs required to be procured for a given delivery year as a

percentage of delivery year load: thus, if statewide retail customer load in 2040 is 120 million MWh,

then under a 50% RPS goal, 60 million RECs would need to be procured for annual delivery to meet

this goal. P.A. 102-0662 also enacted substantial changes to specific quantitative targets for new wind

and solar – 45 million RECs delivered annually by 2030 from new wind and solar projects – and a

significant expansion of RPS budgets, including additional flexibility around rolling over prior years’

collections to meet future years’ expenses.

As the utilities serve as the counterparty Buyers to RECs under REC delivery contracts (with those

REC purchases then funded through non-bypassable charges to those utilities’ ratepayers), this

compliance is also assessed at the utility level. The resulting analysis includes a determination of

what quantity of RECs presently is, and ultimately needs to be, under contract to meet the applicable

RPS percentage goal of each utility’s retail customer load. Many of the graphs and tables herein

Illinois Power Agency 2022 Long-Term Plan (Final) August 23, 2022

outline RPS progress by RECs under contract for Commonwealth Edison Company, Ameren Illinois,

and MidAmerican Energy Company.

As used in this brief explanation and throughout this Plan, the Agency considers a “goal” to be an

overall percentage of load to be procured in the form of RECs for a given year based upon that year’s

mandated RPS requirement.

138

By contrast, a “target” is the number of RECs for a specific

procurement event or program based upon a specific goal or numerical mandate.

The Tables and Figures contained in this chapter will be updated by the Agency on a quarterly basis

and will be published on the Agency’s website. As this Plan was finalized in August 2022 and reflects

updated inputs where available, the Agency expects the first standalone update to be published by

November 2022.

3.2. REC Portfolio

For the planning and development of the various procurements and programs under this 2022 Long-

Term Plan, the Agency has aggregated the utility level portfolios of all existing RECs under contract,

which includes all expected RECs under the Adjustable Block Program and all expected RECs under

contract through competitive procurements, into a single, statewide portfolio of RECs. The statewide

portfolio can then be examined against REC goals and targets mandated in the Act to estimate gaps

that need to be filled through future procurement of RECs.

The following sections examine existing REC portfolios and the resulting statewide REC Portfolio

after accounting for expected deliveries of RECs resulting from REC delivery contracts executed to

date.

139

3.2.1. Existing REC Portfolios – RECs Already Under Contract

Figure 3-1 and Table 3-1 show the aggregated statewide portfolio and the existing REC portfolio of

each utility as of August 23, 2022. This includes RECs from the following categories:

•

RECs procured under the Long-Term Power Purchase Agreements (LTPPAs”) entered into in

2010 (20 year contracts);

•

RECs procured under the Distributed Generation procurement events conducted by the IPA

in 2015, 2016, and 2017 (5-year contracts that, in some cases, expire during the period

outlined below);

•

RECs procured under the initial forward procurements the procurement events conducted to

date by the IPA pursuant to the Initial Plan, and the Spring 2022 Indexed REC procurement;

•

RECs procured and under contracts resulting from the Adjustable Block Program and the

Illinois Solar for All Program, which includes the RECs associated with the reopening of the

Adjustable Block Program in December 2021.

As discussed further below, the Total RECs under contract has declined slightly relative to the IPA’s

April 20, 2020 Final First Revised Plan, as this figure now accounts for project attrition (i.e., projects

under REC delivery contracts not planning to be developed, or otherwise not planning to perform

under REC delivery contracts) from projects receiving REC delivery contracts under the IPA’s

Forward Procurement events.

138

For example, the RPS “goal” for the 2022-2023 delivery year is 19% of the retail load.

139

Appendix B-1 contains breakdowns of RPS goals and budget by each utility.

Illinois Power Agency 2022 Long-Term Plan (Final) August 23, 2022

The utilities’ existing REC portfolios can be assembled to produce the Statewide REC Portfolio

presented in Figure 3-1. This Figure provides an overview of the volume of RECs presently expected

to be delivered to meet the various RPS goals and targets mandated in the Act. Table 3-1 provides a

breakdown of the Statewide REC Portfolio by utility and by technology. Data used to generate these

figures are provided in Appendix B to this Plan.

Figure 3-1: Current Statewide REC Portfolio (By Expected Delivery Year)

Table 3-1: Current REC Portfolio by Utility (By Expected Delivery Year)

Ameren

ComEd

MidAmerican

Delivery

Year

Total Wind

RECs

Total Solar

RECs

Total Wind

RECs

Total Solar

RECs

Total Wind

RECs

Total Solar

RECs

2020-21

810,680

228,778

1,747,320

516,265

2,409

426

2021-22

1,202,387

562,473

2,686,725

1,494,514

6,816

7,452

2022-23

1,202,387

1,117,201

2,686,725

2,859,966

6,816

13,382

2023-24

1,202,387

1,308,924

2,686,725

3,172,893

6,816

14,321

2024-25

1,202,387

1,302,379

2,686,725

3,170,142

6,816

14,259

2025-26

1,461,386

1,557,185

3,019,972

3,860,406

7,906

16,466

2026-27

1,460,092

1,549,398

3,019,972

3,854,211

7,906

16,395

2027-28

1,458,803

1,541,650

3,019,972

3,848,054

7,906

15,725

2028-29

1,457,521

1,533,941

3,019,972

3,841,937

7,906

15,555

2029-30

1,456,245

1,526,270

3,019,972

3,835,876

7,906

15,158

2030-31

1,454,976

1,518,638

3,019,972

3,829,846

7,906

15,061

1,000,000

2,000,000

3,000,000

4,000,000

5,000,000

6,000,000

7,000,000

8,000,000

9,000,000

2021-2022 2022-2023 2023-2024 2024-2025 2025-2026

Renewable Energy Credits (RECs)

Total Wind Total Solar Total All RECs

Illinois Power Agency 2022 Long-Term Plan (Final) August 23, 2022

These totals do not account for the additional procurements or program capacity proposed in this

and future Long-Term Plans. Consequently, these totals do not constitute the IPA’s projections of

progress toward meeting RPS goals in upcoming delivery years; they merely reflect the Statewide

REC Portfolio given REC delivery contracts presently in place as of the finalization of this 2022 Long-

Term Plan and serve as a snapshot of the current status of the RPS portfolio. Table 3-5 and Figure 3-2

below which describe the gap in RECs remaining to be procured, include estimates of how the REC

portfolio will grow with additional RECs associated with the actual volumes from the Adjustable

Block Program reopening, and the results of the May 2022 procurement for RECs from utility-scale

wind, solar, and brownfield site photovoltaic projects.

As available annual RPS budgets have increased significantly through P.A. 102-0662’s changes to

Section 1-75(c)(1)(E) of the IPA Act (increasing the statutory rate impact cap) and Section 16-108(k)

of the PUA (allowing for prior years’ collections to be rolled over to meet future years’ expenses over

a 5-year period on a “first in, first out” basis), additional funds are now available to support

procurement activity toward meeting RPS targets and goals. The IPA is thus proposing additional

program activity and procurement events that would serve to significantly increase the balance of

RECs under contract in future delivery years. Section 3.4.6 below provides an overview of how the

REC portfolio (and associated budget impacts) would change as a result of these proposed activities.

3.3. RPS Goals and Targets

Developing the 2022 Long-Term Plan first involves calculation of the annual REC targets and goals

required by statute, and next determining the quantities of RECs to be procured to fill identified gaps

between RECs under contract and RECs needed to be procured. In the prior Section, a statewide

current REC portfolio was presented. The REC quantities in that portfolio will be used in conjunction

with the REC targets and goals outlined in this Section to estimate REC “gaps” that need to be filled

to meet statutory RPS goals and targets.

The volume of RECs that need to be procured through the Agency’s procurements and programs can

be viewed in two ways. First, as the “Target REC Gap” which is the quantity needed to meet the

specific quantitative targets found in Section 1-75(c)(1)(C) of the Act (e.g., 45 million RECs from new

wind and solar by 2030); and second, as the “Goal REC Gap” which is quantity needed to meet the

annual percentage based goals found in Section 1-75(c)(1)(B) of the Act (which could include RECs

that are not from “new” wind or solar, such as RECs delivered under the LTPPAs). As described below,

the Target REC Gap has only two milestone check-ins under statute: a 2020-2021 delivery year target

(10 million RECs delivered annually) and a 2030-2031 delivery year target (45 million RECs

delivered annually). In contrast, as Section 1-75(c)(1)(B) assigns specific percentage increases off of

a baseline to each individual delivery year, the Goal REC Gap can be calculated on an annual basis.

3.3.1. RPS Goals

RPS annual goals are expressed as percentages in Section 1-75(c)(1)(B) of the Act. To determine the

number of RECs required to meet the goals (the “Overall RPS Target”), the delivery year RPS goal is

applied to the reference year applicable retail customer load (“Applicable Load”) as shown in

equation (1).

(1) Delivery Year Overall RPS Target = Delivery Year RPS Goal * Reference Year

Applicable Load

Illinois Power Agency 2022 Long-Term Plan (Final) August 23, 2022

This Chapter contains calculations of REC Portfolio, RPS goals and targets, and summaries of RPS

budgets for delivery years 2021-2022 through 2026-2027. Additional details are available in

Appendix B.

140

Through changes to the RPS made via P.A. 99-0906, the annual RPS percentage goal is applied to the

total retail electricity load rather than the “eligible retail load.” These goals were further extended by

P.A. 102-0662 to increase by 3% after the 2025-2026 delivery year.

Table 3-2: Annual RPS Goals

Delivery Year

Goal (% of total retail

electricity sales)

2021-2022

19.0%

2022-2023

20.5%

2023-2024

22.0%

2024-2025

23.5%

2025-2026

25.0%

2026-2027

28.0%

2027-2028

31.0%

2028-2029

34.0%

2029-2030

37.0%

2030-2031

40.0%

As a result of the funding challenges that constrained RPS activities in previous years, meeting the

current RPS goals of the IPA Act would require procuring approximately 17 million additional RECs

for the 2022-2023 delivery year and increasing to the forecasted procurement of an additional 40

million RECs for the 2031-2032 delivery year. Achieving these goals would require a substantial

increase in new renewable energy generation under contract, likely requiring well over 10,000 MW

of new renewable energy generation.

This 2022 Long-Term Plan presents the start of a ramping up of procurement and program activities

towards meeting these annual percentage goals. However, given the present gaps, it will take several

years of procurements to be on that procurement trajectory, with additional time required for project

development and construction for these REC delivery goals to be achieved.

3.3.2. RPS Targets

As amended by P.A. 102-0662, Section 1-75(c)(1)(C) of the Act now requires the procurement of

RECs “from new projects” in an amount equal to at least “10,000,000 renewable energy credits

delivered annually by the end of the 2021 delivery year, and increasing ratably to reach 45,000,000

renewable energy credits delivered annually from new wind and solar projects by the end of delivery

year 2030” such that the percentage-based RPS goals outlined above “are met entirely by

procurements of renewable energy credits from new wind and photovoltaic projects.”

141

Of the target amount 45% is required to be procured from wind projects and 55% from photovoltaic

projects. Of the amount to be procured from photovoltaic projects, 50% is to be procured through

140

Appendix B-1 contains breakouts of the information contained in this chapter by utility. Appendix B-2is the full spreadsheet model used

to generate the tables and figures contained herein. The spreadsheet is available on the Agency’s website in Excel format

athttps://ipa.illinois.gov/energy-procurement/2022-ltrrpp-appendices.html.

141

20 ILCS 3855/1-75(c)(1)(C)(i).

Illinois Power Agency 2022 Long-Term Plan (Final) August 23, 2022

the Adjustable Block Program, 47% from utility-scale solar projects, and 3% from brownfield site

photovoltaic projects.

142

These percentages are minimums of a whole, thus creating individual

targets within broader targets, which may be exceeded in given categories even if doing so leaves

overall proportions aligned differently from those percentages. Table 3-3 summarizes these targets

by resource type.

Table 3-3: New Wind and Solar Targets

Resource Category

2020-2021 Target

2030-2031 Target

New Wind

4,500,000

20,250,000

New Solar

5,500,000

24,750,000

Adjustable Block Program

2,750,000

12,375,000

Utility-Scale Solar

2,585,000

11,632,500

Brownfield Site Solar

165,000

742,500

Total

10,000,000

45,000,000

3.3.3. Applicable Retail Customer Load Used to Calculate RPS Goals

Based on forecasts received from the utilities, Table 3-4 shows the forecasted retail customer load

subject to RPS compliance through the 2030-2031 delivery year.

143

Table 3-4: Forecast Retail Customer Load Applicable to the Compliance Year (MWH)

Compliance Year

Ameren

ComEd

MidAmerican

2020-2021

35,620,835

84,760,183

471,451

2021-2022

35,458,611

83,931,773

533,051

2022-2023

35,074,493

84,697,302

530,533

2023-2024

34,924,843

85,136,939

530,949

2024-2025

34,518,654

85,134,247

530,479

2025-2026

34,329,725

84,907,691

530,299

2026-2027

34,329,725

85,035,977

530,381

2027-2028

34,329,725

85,385,509

530,798

2028-2029

34,329,725

85,957,787

531,105

2029-2030

34,329,725

86,103,305

531,451

2030-2031

34,329,725

86,473,068

531,835

For the forecast quantity used for the 2022-2023 delivery year, the Ameren Illinois load declined

0.04% from the forecast numbers included in the First Revised Plan; for ComEd, it declined by 0.03%;

and for MidAmerican it increased by 2.01%. These small changes in forecasted load will have a

142

Id.

143

As customary, in support of the IPA procurement processes, in the fall of 2021 the utilities provided the actual and forecast loads used

in this 2022 Long-Term Plan.

Illinois Power Agency 2022 Long-Term Plan (Final) August 23, 2022

corresponding minor impact on estimated annual RPS goals and budget collections. The impact of

variations in load forecasts is discussed further in Section 3.4.8.

The retail customer load serves as the denominator in calculating RPS Goals. In other words, if retail

load were 100,000,000 MWH in a year where the goal was 25%, then the REC Goal would be 25% of

100,000,000 or 25,000,000 RECs delivered annually. If 10,000,000 RECs had been procured for that

year, then the resulting Goal REC Gap would be 15,000,000 RECs.

Over time, the Large Customer Self-Direct Program described in Chapter 6 will also serve to reduce

that denominator, as Section 1-75(c)(1)(R)(2)(vii) states that “[e]ach renewable energy credit

procured pursuant to this subparagraph (R) by a self-direct customer shall reduce the total volume

of renewable energy credits the Agency is otherwise required to procure from new utility-scale

projects pursuant to subparagraph (C) of paragraph (1) of this subsection (c) on behalf of contracting

utilities where the eligible self-direct customer is located.” While this portion of the Self-Direct

Program statute addresses only Section 1-75(c)(1)(C)’s targets, because Section 1-75(c)(1)(C)’s

quantitative targets are a subset of Section 1-75(c)(1)(B)’s percentage-based goals, the IPA

understands that any reduction in targets and load resultant from self-direct customer REC

retirements would also necessitate an adjustment percentage-based REC Goal progress. As those

Self-Direct Program-related adjustments have not yet been established or determined, no

adjustments have been made for this 2022 Long-Term Plan. The Agency will update applicable

figures in tables in the future as that information becomes available.

3.3.4. Overall REC Procurement Targets and Goals – REC Gap

The overall number of RECs needed to be procured for each year to meet annual Goal REC Gap is the

difference between the RPS Target RECs from Table 3-5 and the total number of current RECs in the

Statewide REC Portfolio as shown in Figure 3-1. RECs currently under contract come from several

sources. First, RECs from Long-Term Power Purchase Agreements (“LTPPAs”) for utility-scale wind

and solar from a procurement conducted in 2010; second, RECs from utility-scale wind, solar, and

brownfield site photovoltaics from forward procurements conducted in 2018 through 2019 and the

first Indexed REC procurement conducted in Spring 2022; and third, IPA Programs which include

RECs from the Adjustable Block Program and RECs from the Illinois Solar for All Program. For

additional information on the LTPPAs and forward procurements, please see Chapter 5. For

additional information on the Adjustable Block Program and Illinois Solar for All, please see Chapters

7 and 8, respectively. Please note that the table below reflects the timing of expected deliveries from

existing contracts resultant from procurement activity already conducted, and not procurement

event dates; REC deliveries may lag REC delivery contract execution by 1-5 years depending on

project size and complexity.

Illinois Power Agency 2022 Long-Term Plan (Final) August 23, 2022

Table 3-5: Statewide Overall Goal REC Gap

144

145

Delivery

Year

2010

LTPPAs

Legacy

2017-2019

Forward

Procurements

2019-2021

Adjustable

Block and

Illinois

Solar for All

Programs

ABP

Reopening

May 2022

Forward

Procurements

Total

Overall RPS

Target

Goal REC

Gap

2020-21

1,861,725

3,273

730,000

710,880

3,305,878

21,149,182

17,843,305

2021-22

1,861,725

21,732

2,983,671

1,093,239

5,960,367

22,785,453

16,825,086

2022-23

1,861,725

5,613

4,571,149

1,177,058

270,933

7,886,477

24,661,977

16,775,500

2023-24

1,861,725

4,571,149

1,314,907

644,285

8,392,066

26,530,401

18,138,335

2024-25

1,861,725

4,571,149

1,308,770

641,064

8,382,707

28,243,094

19,860,387

2025-26

1,861,725

4,571,149

1,302,669

637,858

1,416,584

9,789,985

29,941,929

20,151,943

2026-27

1,861,725

4,571,149

1,296,589

634,669

1,411,801

9,775,932

33,570,903

23,794,971

2027-28

1,861,725

4,571,149

1,289,945

631,496

1,407,042

9,761,356

37,276,270

27,514,913

2028-29

1,861,725

4,571,149

1,283,842

628,338

1,402,307

9,747,361

41,078,330

31,330,969

2029-30

1,861,725

4,571,149

1,277,567

625,196

1,397,595

9,733,232

44,756,858

35,023,626

2030-31

1,861,725

4,571,149

1,271,621

622,070

1,392,907

9,719,473

48,533,851

38,814,378

Figure 3-2 below provides a visual representation of the annual Statewide RPS Goals, REC Portfolio,

and REC Gap discussed in this Section.

144

Unadjusted for RECs supplied by an ARES to their retail customers pursuant to Section 1-75(c)(1)(H)(i) of the IPA Act (see Section 3.6

for an explanation of this provision), or the Large Customer Self-Direct Program (as described in Chapter 6).

145

The 2010 LTPPAs and 2017-2019 Forward Procurements featured fixed annual delivery volumes. Other solar programs and

procurements factor in a 0.5% annual degradation rate for REC deliveries.

Illinois Power Agency 2022 Long-Term Plan (Final) August 23, 2022

Figure 3-2: Statewide Annual RPS Goal, REC Portfolio and REC Gap

Illinois Power Agency 2022 Long-Term Plan (Final) August 23, 2022

The statewide RPS Goals for 2021-2022 through 2031-2032 are shown in the table below.

Table 3-6: Statewide RPS Goals

Delivery Year

RPS Goal

Reference Year

Reference Year Load

(Applicable Load)

[MWh]

RECs needed to

meet RPS Goal

2021-2022

19.0%

2020-2021

119,923,435

22,785,453

2022-2023

20.5%

2021-2022

120,302,328

24,661,977

2023-2024

22.0%

2022-2023

120,592,731

26,530,401

2024-2025

23.5%

2023-2024

120,183,380

28,243,094

2025-2026

25.0%

2024-2025

119,767,715

29,941,929

2026-2027

28.0%

2025-2026

119,896,083

33,570,903

2027-2028

31.0%

2026-2027

120,246,032

37,276,270

2028-2029

34.0%

2027-2028

120,818,617

41,078,330

2029-2030

37.0%

2028-2029

120,964,481

44,756,858

2030-2031

40.0%

2029-2030

121,334,628

48,533,851

2031-2032

40.9%

2030-2031

121,773,218

49,808,422

3.3.5. Procurement Targets to Meet Specific Wind-Solar Requirement and

Overall RPS Targets

Section 1-75(c)(1)(C)(i) of the Act requires that, to the extent possible, the overall quantity of RECs

procured to meet the RPS goals should include at least 45% from new wind projects and 55% from

new photovoltaic projects. Of the portion that is from photovoltaic projects, 50% should be from the

Adjustable Block Program, 47% from new utility-scale solar, and 3% from brownfield site

photovoltaic projects.

146

Table 3-7 below shows that the portfolio of expected REC deliveries

portioned by RECs from wind and photovoltaic projects. This table represents RECs under contract

from procurements and programs conducted as of the finalization of this 2022 Long-Term Plan.

146

20 ILCS 3855/1-75(c)(1)(C)(i).

Illinois Power Agency 2022 Long-Term Plan (Final) August 23, 2022

Table 3-7: Projected Deliveries of Statewide Wind and Solar RECs in the Current Portfolio

147

Delivery Year

Solar RECs

Wind RECs

Combined Wind

and Solar RECs

2021-2022

2,064,439

3,895,928

5,960,367

2022-2023

3,990,549

3,895,928

7,886,477

2023-2024

4,496,138

3,895,928

8,392,066

2024-2025

4,486,779

3,895,928

8,382,707

2025-2026

5,434,057

4,489,265

9,923,322

2026-2027

5,420,004

4,487,970

9,907,974

This table indicates that the balance of RECs currently in the portfolio is slightly out of balance with

the goals of the Act. Additionally, because Section 1-75(c)(1)(C)(iii) provides that “no renewable

energy credits from contracts entered into before June 1, 2021 shall be used to calculate whether the

Agency has procured the correct proportion of new wind and new solar contracts,” the balance of

wind RECs versus solar RECs is best assessed on a forward-looking basis.

This Chapter’s quantities of RECs under contract from utility-scale procurements held in 2017 and

2018 have been updated from the Initial and Revised Long-Term Plans to account for project attrition

(i.e., projects receiving REC delivery contracts not being successfully developed under the terms of

those contracts). While four wind projects and six utility-scale solar projects have begun delivery,

other projects have not yet been energized. Five solar projects have requested energization

extensions that will take them into 2022-2023 delivery year, and four solar projects and two wind

projects have been removed from the REC portfolio due to project attrition.

Table 3-8 summarizes in aggregate the status of anticipated annual REC deliveries from utility-scale

projects, setting aside that projects may begin initial deliveries in different delivery years. The

quantities listed are the aggregate annual contracted amounts.

Table 3-8: 2017-2019 Forward Procurement REC Portfolio Status

Status

Solar RECs

148

Wind

RECs

Total RECs

Delivering RECs

1,238,936

2,065,519

3,304,455

Extensions Granted

1,266,693

Total Expected Annual RECs

2,505,629

2,065,519

4,571,148

Removed

149

548,702

879,234

1,427,936

Attrition Rate

18%

30%

24%

147

These totals reflect quantities from the LTPPAs, which do not count towards Section 1-75(c)(1)(C)(v)’s targets for RECs from new wind

and solar, RECs from the 2015-2019 Utility DG procurements, RECs from the 2017-2019 Forward Procurements, and RECs currently under

contract from the Adjustable Block Program and the Illinois Solar for All Program.

148

Includes RECs from brownfield site photovoltaic projects.

149

“Removed” indicates RECs that were procured in the 2017 and 2018 procurements but will not be delivered because of the projects not

meeting energization deadlines and thus have been removed from the RPS REC Portfolio.

Illinois Power Agency 2022 Long-Term Plan (Final) August 23, 2022

In comparison to these utility-scale project attrition rates, the attrition rate for the Adjustable Block

Program has been lower, at approximately 1.2% of contracted Small DG projects, 9.8% of contracted

Large DG projects, and 7.2% of contracted community solar projects. However, the sample size for

utility-scale solar projects is small and causes for attrition may be project specific, and thus may not

necessarily indicative of attrition rates for projects in future procurements. Additionally, the Agency

is hopeful that the shift to an Indexed REC pricing model as required under Section 1-75(c)(1)(G)(v)

of the Act will reduce the development risk to new utility-scale projects, as those changes should help

ensure revenue certainty for projects receiving REC delivery contracts.

3.4. RPS Budget

3.4.1. Statewide Goals and Allocation of Cost and RECs from RPS

Procurements to Each Utility

The specific numerical targets included in the Act—for instance, the 10,000,000 RECs from new wind

and new photovoltaics by the 2021 delivery year—are statewide targets which do not specify

individualized REC targets for each utility. Since the passage of P.A. 99-0906, the Agency has procured

RECs through its competitive procurements based on statewide RPS targets rather than individual

targets by utility, such that an overall target quantity is published and projects are selected up to that

overall target quantity. Contract quantities stemming from those procurements were then assigned

to each of the three participating utilities based on an RPS Budget-weighted basis, meaning that an

individual utility-scale solar or wind project may have three REC delivery contracts (one with each

of Ameren Illinois, ComEd, and MidAmerican) for load-weighted delivery quantities.

In a corresponding manner, the cost of purchasing RECs associated with RPS procurements is

allocated to each utility through REC procurement contracts specific to the applicable utility (and

independent of supplier performance under other utilities’ contracts), based on each utility’s

Renewable Portfolio Standard Budget (“RPS Budget”) – which is also based on load.

Table 3-9 shows the proposed allocation across each of the three utilities based on each utility’s cost

cap rate and eligible load.

150

This allocation method was initially developed to allocate the RECs from the August 31, 2017 Initial Forward Procurement and was

based on the RPS Budget for 2020-2021, which uses the prior year delivered volumes as reference. The 2019-2020 reference delivery year

was used because it will be the first year when all load, including that served by ARES, will be under the IPA’s REC procurements, thus

making the resulting RPS Budget a better representation of future RPS Budgets. As shown in Table 3-9 the allocation to each utility is based

on the utility’s share of the 2022-2023 delivery year RPS Budget. As noted in Chapter 6, the same allocation will generally be used for the

Adjustable Block Program contract awards.

Illinois Power Agency 2022 Long-Term Plan (Final) August 23, 2022

Table 3-9: Utility REC Cost Allocations

Utility

Reference Year

Forecasted Delivered

Volume [MWh]

151

Cost Cap

Rate

152

[$/MWh]

RPS Budget for

2022-2023

Delivery Year

[$]

153

Allocation Based on RPS

Budget for 2022-2023

Delivery Year [%]

Ameren Illinois

35,074,493

$4.5755

$160,483,343

27.318%

ComEd

84,697,302

$5.0248

$425,587,002

72.445%

MidAmerican

154

530,533

$2.625

$1,392,649

0.237%

Under this allocation, for every $1,000,000 of expenditures made to procure RECs, $273,190 and

associated REC contracts would be allocated to Ameren Illinois, $724,450 and associated REC

contracts to ComEd, and $2,370 and associated REC contracts to MidAmerican.

For this 2022 Long-Term Plan, the Agency proposes to continue conducting the procurement of RECs

based on statewide RPS goals and targets which, due to changes in load forecasts and the presence

of new RECs under contract, have been updated from those contained in prior Plans. These values

will also be updated in future iterations of the Plan to reflect the implementation of the Large

Customer Self-Direct Program described in Chapter 6.

3.4.2. Cost Cap and Cost Recovery Provisions

The IPA’s procurement of RECs on behalf of Illinois electric utilities is subject to monetary limitations

in the form of a cost cap that limits the annual average net increase to all eligible retail customers to

4.25% of the amount paid per kilowatthour by eligible retail customers during the year ending May

31, 2009.

155

The cost cap rate, in dollars per megawatt-hour, is provided in Table 3-2. This rate was

increased by Public Act 102-0662 from the 2.015% of 2007 eligible retail rates statutorily authorized

in the past. The combination of the different baseline year and increased percentage results in

significant increases in funding collected each year, ranging from a 211% increase for MidAmerican,

to a 253% for Ameren, and 266% for ComEd.

Each utility is entitled to recover the costs of the RECs procured to meet the RPS compliance

requirements, subject to the cost cap limitations, along with “the reasonable costs that the utility

incurs as part of the procurement process and to implement and comply with plans and processes

approved by the Commission.”

156

In addition to changing the cost cap, Public Act 102-0662 made two significant changes to how funds

collected by the utilities are accounted for. First, the previous reconciliation provision from Public

151

The 2021-2022 delivery year is the reference year for the 2022-2023 delivery year.

152

The Cost Cap Rate for each utility is defined in Section 1-75(c)(1)(E) of the Act as 4.25% of the amount paid per kilowatthour by eligible

retail customers during the year ending May 31, 2009, which results in a cost cap rate of 0.45755 c/kWh for Ameren, 0.50248 c/kWh for

ComEd, and 0.26250 c/kWh for MidAmerican.

153

Beginning with the 2019-2020 delivery year, the RPS Budget for each utility is calculated by multiplying the values of the preceding two

columns of the table, as specified by Section 1-75(c)(1)(F) of the Act (“To arrive at a maximum dollar amount of renewable energy

resources to be procured for the particular delivery year, the resulting per kilowatthour amount shall be applied to the actual amount of

kilowatthours of electricity delivered […] by the electric utility in the delivery year immediately prior to the procurement to all retail

customers in its service territory.”).

154

The methodology to determine MidAmerican’s Applicable load is explained in Section 3.7.

155

20 ILCS 3855/1-75(c)(1)(E).

156

220 ILCS 5/16-108(k).

Illinois Power Agency 2022 Long-Term Plan (Final) August 23, 2022

Act 99-0906 that required a reconciliation of collections and expenses (e.g., a refund to customers of

unspent funds) after four years (June 1, 2021), and then on an annual basis thereafter, was replaced

with new language in Section 16-108(k) of the PUA that allows for collections from customers to be

available for meeting RPS expenses for the five years following collection:

Money collected from customers for the procurement of renewable energy resources in

a given delivery year may be spent by the utility for the procurement of renewable

resources over any of the following 5 delivery years after which unspent money shall be

credited back to retail customers. The electric utility shall spend all money collected in

earlier delivery years that has not yet been returned to customers, first, before spending

money collected in later delivery years.

Second, that Section 16-1085(k) of the PUA was also modified to provide that any future

reconciliation amounts shall be reduced to account for contractual obligations entered into by the

utilities but not yet paid:

The amount of excess funds eligible to be credited back to retail customers shall be

reduced by an amount equal to the payment obligations required by any contracts

entered into by an electric utility under contracts described in subsection (b) of Section

1-56 and subsection (c) of Section 1-75 of the Illinois Power Agency Act, even if such

payments have not yet been made and regardless of the delivery year in which those

payment obligations were incurred. Notwithstanding anything to the contrary,

including in tariffs authorized by this subsection (k) in effect before the effective date of

this amendatory Act of the 102nd General Assembly, all unspent funds as of May 31,

2021, excluding any funds credited to customers during any utility billing cycle that

commences prior to the effective date of this amendatory Act of the 102nd General

Assembly, shall remain in the utility account and shall on a first in, first out basis be used

toward utility payment obligations under contracts described in subsection (b) of

Section 1-56 and subsection (c) of Section 1-75 of the Illinois Power Agency Act.

Prior to the enactment of Public Act 102-0662, Section 16-018(k) of the PUA required annual

reconciliation of collections and expenditures after June 1, 2021. This proved unduly constraining, as

expenses rolled forward into future years (especially due to project energization delays) while

collections could not be rolled forward to meet those expenses. This phenomenon limited available

budgets prevent the Agency from opening additional blocks of the Adjustable Block Program or

conducting additional utility-scale procurements. The COVID-19 global health pandemic further

exacerbated this problem, as many expenditures that had been projected to occur prior to June 1,

2021 were pushed out well beyond that date due to resultant project development delays, resulting

in the potential for a significant refund of unexpended—but contractually committed—RPS funds.

This left the Agency with an available RPS budget too small to meet contracted RPS expenses. As a

result, the IPA petitioned the ICC to reopen Docket No. 19-0995 approving the Agency’s First Revised

Plan to clarify the process by which payment deferrals on REC delivery contracts would occur. While

the Commission approved that process in May of 2021, the enactment of Public Act 102-0662

rendered this payment reduction/deferral issue moot through significantly increasing RPS funding

in addition to the two new accounting provisions outlined above.

Utilities are able to recover all of their costs—whether associated with RECs previously procured

through prior-executed contracts, procured through the Initial Forward Procurements, procured

Illinois Power Agency 2022 Long-Term Plan (Final) August 23, 2022

through other competitive procurements, or procured through the other programs resulting from

the implementation of the IPA’s long-term renewable resource procurement plans

157

—through

tariffs applicable to all of the utilities’ customers. With the enactment of Public Act 102-0662, ComEd

and Ameren filed revised tariffs to implement these revised rate collection levels and those tariffs

took effect in January of 2022. Tariff revisions by MidAmerican are pending.

3.4.3. RPS Compliance Procurement Priorities

The Act provides guidelines for prioritizing REC procurements in the event that the cost cap

limitations conflict with the RPS goals and targets such that the IPA cannot procure sufficient

additional quantities of RECs to meet goals or targets.

158

Under Section 1-75(c)(1)(F) of the IPA Act,

these priorities regarding the procurement of RECs take the following order, arranged based on

descending priority:

• RECs procured under existing contracts (as of June 1, 2021);

• RECs procured with funding for the Illinois Solar for All Program;

• RECs procured to comply with the new wind and solar photovoltaic procurement

requirements (including the Adjustable Block Program);

• RECs procured to meet the remaining RPS targets (Goal REC Gap).

In contrast to the situation where the cost cap conflicts with RPS Goals and Targets, Section 1-

75(c)(1)(C)(ii) directs that even if goals and targets are met, funds shall continue to be spent:

In any given delivery year, if forecasted expenses are less than the maximum budget

available under subparagraph (E) of this paragraph (1) the Agency shall continue to

procure new renewable energy credits until that budget is exhausted in the manner

outlined in item (i) of this subparagraph (C).

Subparagraph (E) sets the budget for each year based on a calculation of each utility’s prior year

MWH volume of sales and the 4.25% rate cap (as discussed in Section 3.4.2). The available funds are

also impacted by additional considerations in including the ability of funds to be available for five

years after collection and the reserve of utility-held alternative compliance payments (ACPs”) (see

Sections 3.4.2 and 3.5). Item (i) of subparagraph (C) establishes targets of 10 million RECs for 2021

and 45 million RECs for 2030 respectively, as well as the split between solar and wind as described

in Section 3.3.5. Thus, the Agency understands that Section 1-75(c)(1)(C)(ii) directs the Agency to

maximize procurement volumes where possible.

However, REC contracts carry uncertainty about when payments will commence because of the

varying development times of renewable energy projects as well as payment schedules that span

multiple years. As a result, the Agency must analyze not only what funds are available in a given

delivery year, but also what budget may need to be reserved for future delivery years. As a simplified

example, if forecasted expenses for a year are $10 million less than the budget available for the year,

but due to prior conducted procurements and programs the projected budget for the following year

compared to expenses relies on that $10 million being rolled over into that next delivery year to fully

cover projected expenses, it would not make sense to conduct additional procurement activities in

the current delivery year to create $10 million in new commitments, as those funds would be needed

157

This is true for those expenses for which the utility is the counterparty; for the Illinois Solar for All Program, the State of Illinois is the

counterparty to REC delivery contracts paid using the Renewable Energy Resources Fund.

158

20 ILCS 3855/1-75(c)(1)(F).

Illinois Power Agency 2022 Long-Term Plan (Final) August 23, 2022

for that future delivery year. Analyzing RPS budget availability requires being cognizant of the

cascading impacts of commitments on future delivery years.

As shown in Table 3-11 and Table 3-12, the Agency has considered the budget impacts of:

• Procurements and programs to date (REC quantities and payment obligations under existing

contracts);

• Funding allocations to the Illinois Solar for All Program;

• The Spring 2022 procurements for utility-scale wind, solar, and brownfield site photovoltaic

projects, and capacity filled from the December 2021 reopening of the Adjustable Block

Program;

• Procurements and Adjustable Block Program blocks and REC prices proposed in this Plan;

and

• Estimates of activities in subsequent delivery years that would be proposed in subsequent

Long-Term Plans to meet the 45 million RECs by 2030 target.

Taking these budget impacts into account, through at least the middle part of the decade the Agency

projects that the available funding left in each year will be approximately equivalent to one year of

collections. However, that amount declines over time. This modeling also suggests that the oldest

funds available for use would never be more than two years old, and thus funds are highly unlikely

to be subject to reconciliation due to not having been used across the five years following collection.

The Agency notes that at present, budget impacts resultant from the change to an indexed REC price

procurement model for competitive procurements are unpredictable. The Adjustable Block Program

REC prices used for this budget analysis are for the 2022 Delivery Year, and for the 2023 Delivery

Year the Agency has made adjustments to reflect the change in the federal Investment Tax Credit

from the recently enacted Inflation Reduction Act (Public Law 117-169), and then an annual 4%

decline. REC prices for future years are likely to vary from these values as the Agency updates its

approach for administratively determined REC prices through a stakeholder process for the 2023

Delivery Year and then through the next Long-Term Plan development process for years thereafter.

Thus, a very large error band must be applied to any budget forecasts given this inherent uncertainty.

For this Plan, the Agency has proposed quantities for competitive procurements and Adjustable Block

Program block sizes that will put it on a path to having procured 45 million RECs delivered annually

from new projects by the 2030 delivery year.

As the Agency gains more information about future RPS budget impacts over the next 18 months of

program and procurement activities, the next Long-Term Plan will consider whether those

procurement quantities could be increased.

3.4.4. RPS Budget and Cost Cap

As described in Section 3.4.2, the Act imposes monetary limitations on the RPS in the form of a cost

cap that limits the annual average net increase in rates to retail customers. The cost cap rate, in cents

per kilowatt-hour, is unique to each utility and is provided in Table 3-9. The cents per kilowatt-hour

rate is applied to the actual electricity (expressed in kilowatt-hours) delivered in the delivery year

immediately prior to determine a maximum dollar amount which constitutes the RPS Budget for the

delivery year. Specifically, the Act states that:

Illinois Power Agency 2022 Long-Term Plan (Final) August 23, 2022

Notwithstanding the requirements of this subsection (c), the total of renewable energy

resources procured under the procurement plan for any single year shall be subject to

the limitations of this subparagraph (E). Such procurement shall be reduced for all retail

customers based on the amount necessary to limit the annual estimated average net

increase due to the costs of these resources included in the amounts paid by eligible

retail customers in connection with electric service to no more than 4.25% of the amount

paid per kilowatthour by those customers during the year ending May 31, 2009. To arrive

at a maximum dollar amount of renewable energy resources to be procured for the

particular delivery year, the resulting per kilowatthour amount shall be applied to the

actual amount of kilowatthours of electricity delivered, or applicable portion of such

amount as specified in paragraph (1) of this subsection (c), as applicable, by the electric

utility in the delivery year immediately prior to the procurement to all retail customers

in its service territory. The calculations required by this subparagraph shall be made

only once for each delivery year at the time that the renewable energy resources are

procured. Once the determination as to the amount of renewable energy resources to

procure is made based on the calculations set forth in this subparagraph (E) and the

contracts procuring those amounts are executed, no subsequent rate impact

determinations shall be made and no adjustments to those contract amounts shall be

allowed. All costs incurred under such contracts shall be fully recoverable by the electric

utility as provided in this Section.

159

A utility’s annual RPS Budget is calculated as shown in equation (2).

(2) Annual RPS Budget ($/Year) = Prior Year Delivered Electricity (MWh) * Cost Cap Rate

($/MWh)

A utility’s delivery year remaining available net RPS Budget (“Available Net RPS Budget”) is

determined by subtracting from the utility’s total RPS Budget the direct financial obligations

associated with existing REC contracts (“Contracted REC Spend”), the balance associated with

unfilled Adjustable Block Program block capacity, (“Scheduled REC Spend”), and indirect costs: (i)

allocation to fund the Illinois Solar for All Program, (ii) allocation to fund job training programs, and

(iii) set aside for administrative expenses (“Set Asides Allocation”), as shown in equation (3).

(3) Delivery Year Available Net RPS Budget = Annual RPS Budget (equation 2) +

Unexpended RPS Budget from Prior Year

160

+ Utility-held ACP balances – Contracted

REC Spend – Scheduled REC Spend – - Illinois Solar for All Allocation – Set Asides

Allocation

For the purpose of establishing funds available for REC purchases, as explained in the following

Section, the Available Net RPS Budget amount will be adjusted prior to any procurement to account

for rollover unspent funds from prior years, and utility-held Alternative Compliance Payments.

159

20 ILCS 3855/1-75(c)(1)(E).

160

Unexpended budget funds from prior years are subject to a rolling five-year first-in/first-out accounting system. Funds collected in a

given year and not spent after five years are subject to reconciliation. However, any reconciliation amount that could be refunded to

ratepayers is also reduced by an amount equal to the outstanding contracted payment obligations of the utility.

Illinois Power Agency 2022 Long-Term Plan (Final) August 23, 2022

3.4.5. Other Expenses

In addition to direct expenditures on RECs, RPS budgets also feature allocations for several additional

purposes. First, pursuant to Section 1-75(c)(1)(O) of the Act, up to $50,000,000 each year will be

allocated to the Illinois Solar for All Program.

161

Second, also pursuant to Section 1-75(c)(1)(O), in

each of the delivery years 2021-2022, 2024-2025, and 2027-2028, $10,000,000 of ComEd’s RPS

Budget will be allocated to the Department of Commerce and Economic Opportunity to fund solar job

training programs pursuant to Section 16-108.12 of the PUA.

Third, a reasonable amount of each budget will be set aside for administrative expenses (including,

but not limited to, expenses related to development of Plan updates, the management of

procurements and programs, Adjustable Block Program Administrator expenses not covered by fees

charged to participants, and fees charged by tracking systems for the retirement of RECs). The IPA

proposes to set aside 2% of the budget for these administrative expenses, and will refine this amount

as more information becomes available. Table 3-10 shows the annual RPS funds to be allocated to

each of these Set Asides.

Table 3-10: Statewide RPS Budget Set Asides

Delivery Year

Illinois Solar for All

Job Training

(DCEO Budget)

Administrative

Expenses (2%

of Annual RPS

Budget)

Total Set

Asides

2021-2022

$50,000,000

$10,000,000

$9,294,757

$69,294,757

2022-2023

$50,000,000

$11,749,260

$61,749,260

2023-2024

$50,000,000

$11,779,769

$61,779,769

2024-2025

$50,000,000

$10,000,000

$11,742,303

$71,742,303

2025-2026

$50,000,000

$11,702,237

$61,702,237

2026-2027

$50,000,000

$11,715,134

$61,715,134

2027-2028

$50,000,000

$10,000,000

$11,750,282

$71,750,282

3.4.6.

Expenses and Available RPS Budgets

The aggregation of Expenses and RPS Budgets at a statewide level provides an important tool for

planning and implementing the various procurements and programs under this 2022 Long-Term

Plan.

Table 3-11 presents a statewide view of expected expenses. This includes:

• Legacy expenses from the 2010 Long-Term Power Purchase Agreements;

• Legacy expenses from the Forward Procurements conducted in 2017-2019;

• Legacy expenses from the Adjustable Block Program from 2019-2021;

• Projected expenses from the capacity filled from the Adjustable Block Program Blocks that

opened in December 2022,

162

as well as the 2022-2023 and 2023-2034 Program Year Blocks

161

Prior to the enactment of Public Act 102-0662 the annual allocation to the Illinois Solar for All Program was the greater of 5% or $10

million of the utility RPS budget. This increase is discussed in more detail in Section 8.4.3.

162

This includes capacity associated with Traditional Community Solar Projects selected from the lottery waitlists pursuant to Section 1-

75(c)(1)(G)(iv)(3) of the IPA Act.

Illinois Power Agency 2022 Long-Term Plan (Final) August 23, 2022

described in Chapter 7 (including the rolling over of unfilled capacity from the December

2021 blocks);

• Projected expenses for RECs from Utility-scale Wind, Utility-Solar, and Brownfield

Photovoltaic Projects conducted in Spring 2022 Subsequent Forward Procurement and the

procurements proposed in Chapter 5;

• Projected expenses for future blocks of the Adjustable Block Program and competitive

procurements to be conducted in 2024 through 2030 to meet the 45 million new RECs target

(although the size of those future blocks and procurements will be determined in future Long-

Term Plans); and

• Set asides as described in Section 3.4.5.

The projected expenses from the Adjustable Block Program assume that blocks fill every year and

that projects are energized (and thus start receiving payments) by their respective energization

deadlines. Projected ABP expenses are calculated using REC prices applicable to the December 14,

2021 reopening

163

and the REC prices presented in Chapter 7 for the 2022 Delivery Year. Due to the

recent enactment of the Inflation Reduction Act, which increases the Investment Tax Credit from 22%

to 30%, the Agency has made a 12% downward adjustment for the modeled 2023 Delivery Year REC

prices to reflect that change, and then assumes a 4% decline in prices each subsequent year).

164

discussed in Section 7.3.2, block sizes for the Adjustable Block Program are based on a standard

capacity factor for different program categories rather than category specific capacity factors to

translate REC quantities into MW sizes. For the purpose of the budget model presented here, REC

quantities and their associated expenses use category-specific capacity factors..

Utility-scale projects are assumed to begin REC deliveries three years after the procurement date.

For budget modeling, the assumed REC price for utility-scale projects is the average REC price from

the Agency’s last procurement for each resource type (prior to the most recent Indexed REC

procurement event). With the implementation of a new indexed REC price procurement approach, it

is very likely that the REC prices resulting from these procurements may vary from those assumed

prices used in budget modeling, and furthermore, those costs will change year to year based on

changes in wholesale energy prices. As the Agency prefers not to suggest indicative prices for future

procurements, these prices will serve as a proxy until more detailed pricing information is available

after the completion of additional future procurement events.

165

163

See: https://illinoisabp.com/wp-content/uploads/2021/11/Illinois-ABP-12.14.21-Reopening-REC-Prices.pdf.

164

This adjustment is a simplified assumption for this modeling purpose only. The Inflation Reduction Act contains a number of provisions

that can allow the Investment Tax Credit to be at a higher or lower level. Actual REC prices for the 2023 Delivery Year will be determined

through a modeling update and stakeholder feedback process as discussed in Section 7.5.7.

165

Consistent with the Commission’s Order in Docket No. 22-0231, the IPA will be utilizing a forward price curve for estimating budget

impacts resultant from Indexed REC procurements in future Long-Term Plans. See Docket No. 22-0231, Final Order dated July 14, 2022

at 6.

Illinois Power Agency 2022 Long-Term Plan (Final) August 23, 2022

Table 3-11: Projected RPS Expenses ($ millions)

Legacy Programs

Late 2021/2022 Activities

Proposed in This Plan

Potential Future

Activities

Set Asides

Total

Delivery

Year

LTPPAs

2019-2020

ABP

2017-2019

Forward

Procurements

2021

ABP

Blocks

Spring 2022

Forward

Procurement

(Wind, Solar,

Brownfield)

2022-

2023

ABP

2022-2023

Wind, Solar, &

Brownfield

Forward

Procurements

2024-

2030

ABP

2024-2030

Wind, Solar, &

Brownfield

Forward

Procurements

Solar for All, Job

Training, Admin.

Expenses

Total Expenses

2020-

2021

$30.85

$233.27

$2.85

$0.00

$15.77

$282.74

2021-

2022

$24.14

$221.44

$16.71

$0.00

$69.29

$331.60

2022-

2023

$22.06

$180.23

$24.69

$150.2

$0.00

$260.1

$0.00

$61.75

$699.14

2023-

2024

$17.72

$164.56

$24.69

$34.06

$0.00

$268.5

$0.00

$61.78

$571.33

2024-

2025

$17.42

$138.66

$24.69

$33.91

$0.00

$133.6

$0.00

$178.

$0.00

$71.74

$598.77

2025-

2026

$11.40

$66.07

$24.69

$33.80

$6.38

$132.9

$14.09

$221.

$0.00

$61.70

$572.52

2026-

2027

$8.22

$5.56

$24.69

$33.69

$6.36

$132.7

$23.17

$261.

$0.00

$61.72

$558.05

2027-

2028

$4.48

$0.00

$24.69

$33.58

$6.33

$132.4

$23.11

$300.

$9.12

$71.75

$606.24

2028-

2029

$4.48

$0.00

$24.69

$33.47

$6.31

$132.1

$23.05

$337.

$18.22

$61.81

$642.08

2029-

2030

$4.34

$0.00

$24.69

$22.58

$6.29

$89.31

$22.99

$373.

$26.95

$61.82

$632.38

2030-

2031

$4.30

$0.00

$24.69

$21.89

$6.26

$57.35

$22.93

$407.

$35.30

$71.86

$652.03

For each delivery year, Table 3-12 calculates expected RPS collections based on the load data listed

in Table 3-4 and the RPS collection rates listed in Table 3-9 and the expenses from Table 3-11 and

calculates, for each year, an expected beginning and ending balance. The 2020-2021 delivery year

starting balance includes utility-held ACP as well as funds collected but not spent in delivery years

2017-2018 through 2019-2020. Table 3-9 and Table 3-12 do not include adjustments to RPS

collections that would result from the implementation of the Large Customer Self-Direct Program

described in Chapter 6 as the size of that program and applicable rate collection adjustments are

unknown at this time. Additionally, Large Customer Self-Direct Program participation may reduce

overall procurement volumes in future years, thus necessitating reduced expenses along with

reduced collections.

Illinois Power Agency 2022 Long-Term Plan (Final) August 23, 2022

Table 3-12: RPS Funds and Expenditures ($ millions)

166

Delivery

Year

Delivery Year

Starting

Balance

RPS

Collections

Total Funds

Available

Total

Expenditures

Delivery Year

Ending

Balance

2020-2021

$461.63

$225.24

$686.87

$282.74

$404.13

2021-2022

$404.13

$464.74

$868.87

$331.60

$537.27

2022-2023

$537.27

$587.46

$1,124.74

$699.14

$425.60

2023-2024

$425.60

$588.99

$1,014.58

$571.33

$443.25

2024-2025

$443.25

$587.12

$1,030.37

$598.77

$431.60

2025-2026

$431.60

$585.11

$1,016.71

$572.52

$444.19

2026-2027

$444.19

$585.76

$1,029.95

$558.05

$471.90

2027-2028

$471.90

$587.51

$1,059.41

$606.24

$453.17

2028-2029

$453.17

$590.39

$1,043.56

$642.08

$401.48

2029-2030

$401.48

$591.12

$992.60

$632.38

$360.22

2030-2031

$360.22

$592.98

$953.20

$652.03

$301.17

Figure 3-3 illustrates year by year spending by type (legacy, in progress, proposed in this Plan,

potential future, set asides) compared to year-to-year budget availability.

Figure 3-3: RPS Expenditures Compared to Annual Available Funds

Based on this forecast of revenue and expenses, the IPA projects that sufficient funding will be

available to support both the proposals contained in this Plan and similar levels of program activity

and procurements for the balance of the decade. Under this analysis, the delivery year starting

166

Breakdowns of the information presented in Table 3-11 and Table 3-12 by each utility, and information on the breakdown of expenses

by program/resource type can be found in Appendices B-1 and B-2 A full spreadsheet version of Appendix B-2 is available on the Agency’s

website at: https://www2.illinois.gov/sites/ipa/Pages/2022-LTRRPP-Appendices.aspx.

$200,000,000

$400,000,000

$600,000,000

$800,000,000

$1,000,000,000

$1,200,000,000

Projected RPS Expenses

Set Asides Legacy Late 2021/2022 Activities

Proposed in This Plan Potential Future Activities Total Available Funds

Illinois Power Agency 2022 Long-Term Plan (Final) August 23, 2022

balances never exceed two years of funding collections which indicates that funds spent in any given

delivery year are funds collected that year or the previous year. However, future budget impacts

carry significant uncertainty flowing from unknowns including the impact of changes in REC Prices

adopted in this or future Long-Term Plans, actual REC prices paid from indexed REC contracts,

changes in utility loads (and thus RPS collections), and the impact of the Large Customer Self-Direct

Program. Extending the assumptions used herein into the 2030s suggests a potential RPS budget

shortfall starting in 2035, however those assumptions are highly dependent on future Adjustable

Block Program REC prices which constitute the bulk of expenditures.

167

As previously committed to through the First Revised Plan, the Agency will seek to have under

contract projects with likely annual expenditures equaling no more than 95% of expected available

funds for any given delivery year to guard against the potential payment reduction of existing

contracts. The Agency has multiple opportunities in subsequent Long-Term Plans to make

adjustments to REC prices, procurement targets, or other factors as more information becomes

available that will allow for the Agency to ensure that a shortfall does not occur and that future

budgets remain within that 95% target. Appendix B includes additional information showing how

these current assumptions would extend through the 2042 delivery year.

3.4.7. Budget Uncertainty Due to Unknowns in Project Energization Timelines

One challenge the Agency has faced in understanding pending budget impacts is that project

energization and REC deliveries—and thus resultant budget impacts—are not scheduled to begin at

a fixed point. Instead, supported projects may become energized at any point over a period of time,

whether immediately upon program application, closer to the contractual deadline for first

deliveries, or later still due to extensions. This creates challenges into budget visibility in part because

Adjustable Block Program projects carry large budget impacts upon energization: 15% of contract

value for distributed generation projects above 25 kW up to 5,000 kW (“Large DG”) and Community-

Driven Community Solar; 100% of contract value for distribution generation up to 25 kW (“Small

DG”).

168

Because payment only commences upon project energization, the Agency cannot have

certainty about when funds for specific projects will begin to be spent.

This dynamic has proven to be a significant challenge in modeling budgets for present and future

delivery years. Thankfully, this challenge has been mitigated by the changes to Section 16-108(k) of

the PUA, including the ability for funds to be available for five years following collection (and utilized

on a “first-in, first-out” basis) and walling off from reconciliation contractual obligations entered into

but not yet paid. The timing of when a project is energized and thus starts receiving payments for

RECs is now a less critical concern, as funds collected in prior years may now meet future years’

expenses even when those expenses are moderately delayed. However, the lumpiness of first

payments could still create future constraints from a cash flow perspective. As indicated in Section

3.5, flexibility with the use of utility-held ACPs creates a relief to that potential pressure.

3.4.8. Budget Uncertainty Due to Annual Load Variations

The annual RPS Budget used in this 2022 Long-Term Plan has been developed using base case load

forecasts provided by the utilities and each utility’s statutory cost cap. These load forecasts are driven

167

For example, changing the assumed annual decrease in REC prices from 4% to 6% would eliminate that shortfall through the 2040s.

168

Adjustable Block Program projects in the Traditional Community Solar and Public Schools categories pay for RECs over the life of the

contract and are this structured more similarly to utility-scale REC delivery contracts.

Illinois Power Agency 2022 Long-Term Plan (Final) August 23, 2022

by a number of factors, which include but are not limited to weather, economics, demographics,

assumed demand response, and energy efficiency. Changes to any of the assumptions will result in

actual load deviating from forecasted load. Examples include changes in weather patterns, changes

in energy efficiency adoption rates, and changes to economic conditions. In practice, the annual RPS

Budget for a delivery year will depend on the actual reference year load for each utility, which will

likely deviate from the forecasted loads provided by the utilities—although in which direction that

deviation will occur is impossible to know until that delivery year.

To see how deviations from the Base Case load forecasts may affect available RPS budgets, the IPA

conducted a comparative analysis of the RPS Budget based on the Base Case, High Case, and Low

Case. Load forecast data for Ameren Illinois and ComEd were used for this analysis. The RPS Budget

for each utility, for each load case, is based on the product of the Applicable Load for a given year and

the cost cap rate shown in Figure 3-8.

169

For each utility, the impact of the High Case and Low Case is

the difference between the RPS budget for each case and the RPS Budget for the Base Case. The total

is the sum of the differences for these utilities.

Figure 3-4: Effect on RPS Budget of Annual Load Variations to the Utilities’ Load Forecast

As shown in Figure 3-4 above, the impact of the low load forecast on the RPS Budget ranges from a

reduction compared to the base case RPS Budgets of approximately $5.1 million in delivery year

2021-2022 to a reduction of approximately $16 million in delivery year 2025-2026. Alternatively,

the impact of the high load forecast on the RPS Budget ranges from an increase compared to the base

case RPS Budgets of approximately $7 million in delivery year 2021-2022 to an increase of

approximately $16.7 million in delivery year 2025-2026. This constitutes a +/- 2 to 3.5% error band

on annual RPS collections.

The scale of load forecast uncertainty increases the further out forecasts are made, as factors such as

economic indicators and climate/weather are compounded and inherently difficult to predict. That

169

The load data for the Base Case, High Case, and Low Case for Ameren and ComEd was provided by the utilities as part of their data

submissions for this Second Revised Plan.

-$20,000,000

-$15,000,000

-$10,000,000

-$5,000,000

$5,000,000

$10,000,000

$15,000,000

$20,000,000

100,000,000

105,000,000

110,000,000

115,000,000

120,000,000

125,000,000

130,000,000

2021-2022 2022-2023 2023-2024 2024-2025 2025-2026

Load Effect on RPS Budget

Load Forecast (MWh)

Low Load Effect on RPS Budget [$] High Load Effect on RPS Budget [$]

Low Load Forecast [MWh] High Load Forecast [MWh]

Illinois Power Agency 2022 Long-Term Plan (Final) August 23, 2022

increasing uncertainty underscores the need for careful consideration as the Agency considers the

impact of procurements and programs on future year budgets.

3.5. Alternative Compliance Payment Funds Held by the Utilities

As of August 23, 2022, Ameren Illinois held $12,959,933 and ComEd held $23,982,074 of alternative

compliance payments collected from retail customers that took service under electric utilities' hourly

pricing tariff or tariffs (“HACP”). These funds are in part committed to fund the REC purchases from

the 2015 through 2017 Distributed Generation procurements conducted by the Agency, which

featured five-year REC delivery contracts with payment upon delivery (and not prepayment).

170

As of August 23, 2022, the remaining balance of uncommitted hourly alternative compliance

payments—those not set aside to fund the Distributed Generation procurements—is $12,959,933 for

Ameren Illinois, and $ 21,197,584 for ComEd.

Also, as of August 23, 2022, Ameren Illinois held $23,519,406, ComEd held $42,874,362, and

MidAmerican held $13,556 of alternative compliance payment funds collected from ARES since June

1, 2017 (“ARES ACP”)

171

as shown in Table 3-22.

The Tables below summarize the balances of these Alternative Compliance Payments.

Table 3-13: Balance of HACP as of January 13, 2022 ($)

Ameren

ComEd

MidAmerican

12,959,933

25,124,996

Table 3-14: Available ACPs ($)

ACP

Ameren

ComEd

MidAmerican

All Utilities

Uncommitted HACP

12,959,933

21,197,584

34,157,517

ARES ACP

23,519,409

42,874,362

13,556

66,393,771

Total Available ACPs

36,479,342

64,071,946

13,556

100,564,844

In its First Revised Plan, the Agency proposed, and the ICC accepted, that the utility held ACPs should

be used in each delivery year after the use of funds collected pursuant to Section 16-108(k) for both

Forward Procurements and the Adjustable Block Program, providing the Agency with a reserve

balance of funds through which it could cover expenditures in excess of Section 16-108(k)

collections. This approach was necessary to minimize the risk of payment deferrals in the 2021-2022

delivery year and the two years directly thereafter, during which the Available Net RPS Budget had

170

2016 and 2017 Distributed Generation procurements for MidAmerican were funded out of MidAmerican’s Renewable Energy Resources

budget, as MidAmerican does not have any Hourly Alternative Compliance Payments.

171

Section 16-115D of the PUA provides that while “[t]hrough May 31, 2017, all alternative compliance payments by alternative retail

electric suppliers shall be deposited in the Illinois Power Agency Renewable Energy Resources Fund,” “beginning with the delivery year

commencing June 1, 2017, all alternative compliance payments by alternative retail electric suppliers shall be remitted to the applicable

electric utility” and not deposited into the RERF. (220 ILCS 5/16-115D(d)(4), (4.5).) See also 83 Ill Adm. Code Part 455. ComEd’s balance

reflects interest earned on the ARES ACP funds held by ComEd, while Ameren Illinois’ and MidAmerican’s do not.

Illinois Power Agency 2022 Long-Term Plan (Final) August 23, 2022

been projected to be negative, meaning that absent this change to the use of utility-held ACPs,

contractual expenditures would need to be pulled back (under curtailment clauses in the REC

contracts) from what was committed in order to bring the Available Net RPS Budget for the delivery

year to zero.

With the delays in project energization created by the COVID-19 pandemic, it appeared in 2021 that,

even with the use of utility-held ACPs, contract payment deferrals could occur, thus resulting the IPA

petitioning the ICC to reopen Docket No. 19-0995 for authorizing a payment deferral system. While

the enactment of Public Act 102-0662 has alleviated those near-term budgetary concerns, the full

budgetary impact of the changes to the RPS are not fully known or understood. As a result, for this

2022 Long-Term Plan, the Agency will maintain the approach of holding utility-held ACPs in reserve.

The Agency will consider alternative uses of utility-held ACPs to maximize their impact on increasing

RPS activities in its next Long-Term Plan.

3.6. Section 1-75(c)(1)(H)(i) ARES Option to Supply RECs for their Retail Customers

Section 1-75(c)(1)(H) of the Act provides an exception to the phase-out of ARES RPS obligations

described in Section 3.1. Under this exception, an ARES may use self-supplied RECs to meet a portion

(and possibly all) of the REC procurement requirements applicable to its load. To do so, the ARES had

to first make an informational filing to the ICC within 45 days of the effective date of Public Act 99-

0906 (i.e., within 45 days of June 1, 2017), indicating that it owned a generating facility or facilities

as of December 31, 2015, that produced RECs eligible to meet the RPS, provided that those facilities

were not powered by wind or solar photovoltaics.

The amount of RECs that can be supplied by ARES-owned/ generation is subject to several

limitations. Specifically, the Act provides that:

For the delivery year beginning June 1, 2018, the maximum amount of renewable energy

credits to be supplied by an alternative retail electric supplier under this subparagraph

(H) shall be 68% multiplied by 25% multiplied by 14.5% multiplied by the amount of

metered electricity (megawatt-hours) delivered by the alternative retail electric

supplier to Illinois retail customers during the delivery year ending May 31, 2016.

For delivery years beginning June 1, 2019 and each year thereafter, the maximum

amount of renewable energy credits to be supplied by an alternative retail electric

supplier under this subparagraph (H) shall be 68% multiplied by 50% multiplied by

16% multiplied by the amount of metered electricity (megawatt-hours) delivered by the

alternative retail electric supplier to Illinois retail customers during the delivery year

ending May 31, 2016, provided that the 16% value shall increase by 1.5% each delivery

year thereafter to 25% by the delivery year beginning June 1, 2025, and thereafter the

25% value shall apply to each delivery year.

172

The Act limits the total amount of RECs that can be supplied by all ARES through owned generation:

For each delivery year, the total amount of renewable energy credits supplied by all

alternative retail electric suppliers shall not exceed 9% of the Illinois target renewable

energy credit quantity. The Illinois target renewable energy credit quantity for the

172

Id.

Illinois Power Agency 2022 Long-Term Plan (Final) August 23, 2022

delivery year beginning June 1, 2018 is 14.5% multiplied by the total amount of metered

electricity (megawatt-hours) delivered in the delivery year immediately preceding that

delivery year, provided that the 14.5% shall increase by 1.5% each delivery year

thereafter to 25% by the delivery year beginning June 1, 2025, and thereafter the 25%

value shall apply to each delivery year.

173

To account for this self-supply by the ARES, the Act requires that charges applicable to retail

customers of that ARES be reduced by the ratio of the RECs supplied by the ARES to the ARES’s RPS

target. Specifically, the Act states that:

If the requirements set forth in items (i) through (iii) of this subparagraph (H) are met,

the charges that would otherwise be applicable to the retail customers of the alternative

retail electric supplier under paragraph (6) of this subsection (c) for the applicable

delivery year shall be reduced by the ratio of the quantity of renewable energy credits

supplied by the alternative retail electric supplier compared to that supplier's target

renewable energy credit quantity. The supplier's target renewable energy credit

quantity for the delivery year beginning June 1, 2018 is 14.5% multiplied by the total

amount of metered electricity (megawatt-hours) delivered by the alternative retail

supplier in that delivery year, provided that the 14.5% shall increase by 1.5% each

delivery year thereafter to 25% by the delivery year beginning June 1, 2025, and

thereafter the 25% value shall apply to each delivery year.

174

The ARES must also notify the Agency and the applicable utility by February 28 of each year of its

election to supply RECs to its retail customers and include the amount of RECs to be supplied. By

April 1 of each year, the IPA posts a report to its website outlining on the aggregate number of RECs

being supplied by the ARES for the upcoming delivery year under this provision, starting June 1.

175

This quantity is accounted for as RECs from “other technologies” (i.e., other than wind or solar) and

reduces the overall RPS Target for that delivery year. Those targets are shown (unadjusted) in Table

3-6.

One ARES informational filing, covering an eligible ARES-owned generation facility located outside

of Illinois, was submitted on a confidential basis to the ICC by the deadline of July 15, 2017.

3.7. MidAmerican Volumes

While procurement plans are required to be prepared annually for Ameren Illinois and ComEd,

Section 16-111.5(a) of the PUA states that “[a] small multi-jurisdictional electric utility . . . may elect

to procure power and energy for all or a portion of its eligible Illinois retail customers” in accordance

with the planning and procurement provisions found in the IPA Act. On April 9, 2015, MidAmerican

first formally notified the IPA of its intent to procure power and energy for a portion of its eligible

retail customer load through the IPA through its participation. That portion is essentially the

incremental load that is not forecasted to be supplied in Illinois by what MidAmerican, a vertically-

integrated utility in Iowa that owns generation there (as well as a share of the Quad Cities nuclear

173

Id.

174

Id.

175

For the 2021-2022 delivery year, see:

https://www2.illinois.gov/sites/ipa/Documents/2021-2022%20Delivery%20Year%20ARES%20REC%20Report.pdf. The amount of

RECs expected to be supplied is 1,704,547.

Illinois Power Agency 2022 Long-Term Plan (Final) August 23, 2022

plant in Cordova, Illinois), assigns to Illinois as its jurisdictional generation. Each year since,

MidAmerican has remained a part of that process to meet the remaining “portion” of its load.

MidAmerican’s status as a multi-jurisdictional utility that uses its own generating resources to meet

a portion of its Illinois load creates a unique situation for RPS compliance. Unlike Ameren Illinois and

ComEd, for which all retail load is subject to the RPS goals and targets (subject to limited exceptions

outlined above), the MidAmerican load for which the RPS goals and targets are applicable has

traditionally been only that load that is subject to the IPA’s annual planning and procurement process

for conventional power. As mentioned above, that amount has been the forecast load in excess of

MidAmerican’s Illinois-allocated generation in any given delivery year, which has generally been only

25-35% of its total jurisdictional load.

176

As a significantly smaller Illinois utility to begin with, and with only a portion of its load applicable to

the Illinois RPS, the MidAmerican share of Illinois RPS and Zero Emission standard contracts has

often been only a fraction of that allocated to ComEd and Ameren Illinois.

3.7.1. Initial Change to MidAmerican’s Load Forecast Methodology

In 2018, MidAmerican proposed and the Commission approved a change in approach to forecast

MidAmerican’s generation used for electricity procurement.

177

This change caused a sudden and

significant reduction of the load subject to the IPA electricity procurement process, as seen in Table

3-15 below.

Table 3-15: MidAmerican Applicable Load and RPS Budget before and after Change in

Forecast Approach

Compliance

Delivery Year

Reference

Delivery Year

Applicable Load

Before Change

[MWh]

178

Applicable Load

After Change

[MWh]

179

RPS Budget

Before Change [$]

RPS Budget

After Change

[$]

2020-2021

2019-2020

616,844

765,812

2021-2022

2020-2021

527,768

655,224

2022-2023

2021-2022

519,093

126

644,454

156

2023-2024

2022-2023

509,457

400

632,491

497

2024-2025

2023-2024

390,919

644

485,326

800

2025-2026

2024-2025

372,831

929

462,870

1,153

In the 2019 Electricity Procurement Plan,

180

the IPA explained the change in approach to forecast

MidAmerican’s generation:

176

The Commission specified this approach for the procurement of renewable resources to meet the RPS compliance targets applicable

to MidAmerican in Docket No. 15-0541, determining that only the portion of MidAmerican’s load subject to the IPA’s planning and

procurement process is subject to Section 1-75(c) of the Act’s requirements.

177

Docket No. 18-1564, Final Order dated November 26, 2018.

178

Based on load volumes presented in the Initial Plan.

179

Based on volumes provided by MidAmerican in its response submitted for the preparation of the First Revised Plan.

180

2019 Final Electricity Procurement Plan at 45-46 (Jan. 4, 2019).

Illinois Power Agency 2022 Long-Term Plan (Final) August 23, 2022

In reviewing the load forecast and resource portfolio information supplied by MidAmerican for

the 2019 Plan, the IPA notes that MidAmerican revised the methodology used for its generation

supply forecast. The prior forecast methodology utilized production cost models to dispatch the

Illinois Historical Resources whenever the expected cost to generate electricity is less than the

expected cost of acquiring it in the market. The revised methodology is based on the utilization

of MISO Unforced Capacity (“UCAP”) from the baseload Illinois Historical Resources to

determine the generation available to meet MidAmerican’s Illinois eligible load.

181

MidAmerican’s revised methodology utilizes the full capability of each baseload generation

asset, represented by the UCAP MW values as determined by MISO for each year’s Planning

Resource Auction. The UCAP values de-rate generating unit capabilities by considering

historical forced outage rates and operating conditions under summer peak conditions. The IPA,

for the 2019 Plan, recommends no changes to the determination of monthly on-peak and off-

peak block energy requirements other than the replacement of generation production values

with the UCAP values for each of the following baseload resources:

• Coal resources including: Neal Unit #3, Neal Unit #4, Walter Scott Unit #3, Louisa

Generating Station, and Ottumwa Generating Station.

• Nuclear Resources: Quad Cities Nuclear Power Station.

The supply capability that is determined is netted against the forecast of MidAmerican Illinois

load to calculate the monthly on-peak and off-peak shortfalls which will be met with energy

block purchases in the IPA procurements. In determining the amount of block energy products

to be procured for MidAmerican, the IPA treats the allocation of capacity and energy from

MidAmerican’s Illinois Historical Resources in a manner analogous to a series of standard

energy blocks. This approach is consistent with the 2018 Procurement Plan approved by the

Commission.

As shown in Table 3-15 above, one unintended consequence of this reduction is that it would cause

the annual commitments of already procured RECs and associated spending to exceed

MidAmerican’s projected RPS annual budget using the prior-applied methodology for determining

that budget amount. Stated differently, MidAmerican was previously assigned contracts assuming it

would have ~$650,000 available to spend annually on renewable energy procurement. Upon those

obligations becoming due and payments needing to be made, applying MidAmerican’s new load

forecasting methodology in combination with the prior approach to determining MidAmerican’s RPS

budget would result in MidAmerican only potentially having hundreds of dollars available for

renewable energy resource procurement.

This could have left entities holding contracts with MidAmerican at risk of non-payment, as absent

an alternative interpretation to calculating MidAmerican’s available RPS budget, MidAmerican would

not be authorized to meet those contract obligations without exceeding its statutory RPS rate impact

cap. This situation could have caused some new renewable energy facilities dependent on revenue

from MidAmerican’s contracts to suffer losses, leaving them potentially unable to generate enough

revenue to cover costs.

181

MidAmerican allocates 10.86% of the UCAP ratings of its baseload units for Illinois Historical Generation.

Illinois Power Agency 2022 Long-Term Plan (Final) August 23, 2022

3.7.2. Correcting for the Unintended Consequences of MidAmerican’s Forecast

Approach

As described in more detail throughout Chapter 2, a primary objective informing Public Act 99-

0906’s reforms to the Illinois RPS was to reduce year-over-year funding volatility that effectively

paralyzed leveraging RPS funds to support the development of new renewable energy generation.

While such volatility was not completely eliminated, year-over-year RPS annual budget changes for

those utilities remain relatively minor, and enough stabilization was introduced to allow for the

execution of the types of long-term contracts providing sufficient revenue certainty to allow

developers to secure financing to develop new renewable generation. To ensure similar stability for

MidAmerican’s budgets, in the First Revised Plan, the IPA proposed and the Commission accepted

the use of a proxy to calculate MidAmerican’s Applicable Load. This proxy for applicable load is a

percentage of MidAmerican’s total Illinois retail load.

MidAmerican’s Applicable Load for the purposes of RPS compliance (i.e., calculations of REC targets,

budgets, and allocation of REC contracts in this Plan) is to be fixed at 26.025% of MidAmerican’s

annual total Illinois retail load. This percentage is calculated as follows: the average of MidAmerican’s

applicable load from the Initial Plan for the DYs 2019-2020 through 2037-2038 is 526,880 MWh. The

average of the total retail load provided by MidAmerican in their July 2019 data response for the

same period is 2,024,484 MWh. The ratio of the average applicable load from the Initial Plan to the

average total retail load provided by MidAmerican in its data response yields a 26.025% proxy.

Adopting this proposal produces Applicable Load volumes that are equivalent to those used in the

Initial Plan, as shown on Table 3-15, which formed the basis to calculate MidAmerican’s targets and

budgets that supported MidAmerican’s allocation of REC contracts and corresponding spending.

Additionally, as can be observed in the Table below, MidAmerican’s resulting Applicable Load and

corresponding budget is relatively stable, year over year, helping to ensure not only that existing

contracts are not curtailed, but also that the year to year volatility does not persist for MidAmerican.

As this proposal was uncontested in Docket No. 19-0995, this proposal was adopted by the

Commission through its Final Order in that proceeding approving the First Revised Plan. This

approach has been maintained for this 2022 Long-Term Plan.

Illinois Power Agency 2022 Long-Term Plan (Final) August 23, 2022

Figure 3-5: Comparison of MidAmerican’s Applicable Load Using the Generation Forecast

before Change and the Proposed Proxy for Determining Applicable Load and Budget

MidAmerican’s Applicable Load will be determined by using the proxy approach proposed in this

Section.

Illinois Power Agency 2022 Long-Term Plan (Final) August 23, 2022

4. Renewable Energy Credit Eligibility

4.1. Introduction

To be eligible for use in compliance with the Illinois RPS, RECs are required to meet a variety of

eligibility requirements. First, the RECs are to be sourced from generating technologies permitted in

the definition of “renewable energy resources” contained in Section 1-10 of the Act. Second,

Subsections (I) and (J) of Section 1-75(c)(1) create additional eligibility criteria. Subsection (I)

contains locational eligibility criteria, while subsection (J) contains criteria related to how a facility

that generates RECs recovers its costs.

This Chapter discusses how the Agency interprets and implements the requirements of Subsections

(I) and (J). Through P.A. 102-0662, changes were made to Section 1-75(c)(1)(I) and (J) of the Act

providing support for RECs associated with electricity transmitted across qualifying high voltage

direct current (“HVDC”) lines and electricity transmitted to Illinois-based HVDC converter stations;

those changes are discussed in Section 4.5 below.

4.2. REC Eligibility

Outside of these HVDC-related changes, P.A. 102-0662 does not otherwise change the process for

determining the eligibility to participate in the Agency’s competitive procurements for utility-scale

projects that are located in the states adjacent to Illinois.

P.A. 99-0906 placed two new-at-the-time conditions on RECs eligible to be used for RPS compliance.

1. A locational standard that allows for RECs from facilities located in Illinois to meet the Illinois

RPS, and from facilities located in adjacent states only if those facilities meet the public

interest criteria set out in Section 1-75(c)(1)(I). By implication, RECs from states further

afield than the states adjacent to Illinois would not qualify for the Illinois RPS.

2. P.A. 99-0906 introduced a new standard related to how generating units recover their costs.

This standard not only prohibits the use of RECs from generating units that recover their

costs through state-regulated rates, but also assesses penalties for RECs from systems later

found to be non-compliant.

182

These eligibility requirements require competitive procurements conducted by the IPA to feature

additional steps to verify that RECs being procured (and, in most cases, the underlying generating

facilities from which they are being procured) are indeed eligible for the Illinois RPS. Additional

review is now required during the bidder registration process to allow the Procurement

Administrator and the Agency to verify information about proposed facilities and if facilities located

in the states adjacent to Illinois meet the public interest criteria.

4.3. Adjacent State Requirement

Section 1-75(c)(1)(I) of the Act contains a locational eligibility requirement for the Illinois RPS.

Enacted through P.A. 99-0906, this requirement replaced the prior locational standard under which

182

See 20 ILCS 3855/1-75(c)(1)(J). Note that Section 1-75(c)(1)(I) references “facility” and “facilities” for the geographic standard, while

Section 1-75(c)(1)(J) references “generating unit” for the cost recovery standard. Section 1-10 of the IPA Act does not specifically define

“generating unit” but does define a facility as, “an electric generating unit or a co-generating unit that produces electricity along with related

equipment necessary to connect the facility to an electric transmission or distribution system.” The Agency understands these terms to be

generally interchangeable.

Illinois Power Agency 2022 Long-Term Plan (Final) August 23, 2022

renewable energy resources could come from Illinois and adjoining states, and if not available, then

they could come from elsewhere.

183

By contrast, Section 1-75(c)(1)(I) permits that qualifying

renewable energy credits can be generated by facilities located in Illinois, and may be sourced from

facilities in adjacent

184

states—but only if these facilities can meet public interest criteria spelled out

in the law. While not explicitly stated in the statute, the Agency understands that the application of

the public interest criteria for only adjacent states means that renewable energy credits from

generating facilities located in states that are not adjacent to Illinois (or from generating facilities in

other countries) will generally not be eligible for the Illinois RPS.

185

The public interest criteria that the Agency considers include:

1. Minimizing sulfur dioxide, nitrogen oxides, particulate matter and other pollution that

adversely affects public health in this State

2. Increasing fuel and resource diversity in this State

3. Enhancing the reliability and resiliency of the electricity distribution system in this State

4. Meeting goals to limit carbon dioxide emissions under federal or state law

5. Contributing to a cleaner and healthier environment for the citizens of this State

The Act specifies that the Agency “may qualify renewable energy credits from facilities located in

states adjacent to Illinois if the generator demonstrates and the Agency determines that the operation

of such facility or facilities will help promote the State's interest in the health, safety, and welfare of

its residents based on the public interest criteria described above.”

186

To do so, and to “ensure that the public interest criteria are applied to the procurement and given full

effect,” the Plan “shall describe in detail how each public interest factor shall be considered and

weighted for facilities located in states adjacent to Illinois.” This Chapter provides that description.

187

In originally developing a methodology for considering and weighting these public interest criteria,

the Agency faced certain challenges. The complex nature of an interconnected electric power grid

and associated system operations (i.e., generation dispatch for economics and reliability), and how

pollution flows across states, all prevented the Agency from simply quantifying and scoring facility

eligibility requests using easily obtainable data. While predictions can be simulated, there is not one

clear, unassailable way to determine how a renewable energy facility in an adjacent state will meet

the public interest criteria.

183

Former 20 ILCS 3855/1-75(c)(3), repealed June 1, 2017.

184

For the purpose of assessing eligibility for compliance with the Illinois RPS, the Agency defines only states that have a common border

as states adjacent to Illinois: Wisconsin, Iowa, Missouri, Kentucky, Indiana, and Michigan. Michigan is considered adjacent due to the border

between Illinois and Michigan that exists in Lake Michigan. This is consistent with how other State Agencies interpret the federal Coastal

Zone Management Act. See, for example, https://www.dnr.illinois.gov/cmp/documents/3_boundary.pdf.

185

One exception introduced through P.A. 102-0662 is for projects utilizing qualifying HVDC transmission lines with converter stations

located in Illinois. As described in Section 4.5 below, the RECs associated with any renewable energy transmitted over that HVDC

transmission line with a verified customer in Illinois will be deemed to have been sourced from a generation facility in Illinois for purposes

of RPS qualification.

186

20 ILCS 3855/1-75(c)(1)(I) (emphasis added).

187

Separately, Chapter 5 describes how adjacent state projects that qualify under this public interest criteria scoring may comply with

prevailing wage requirements found in Section 1-75(c)(1)(Q) of the IPA Act.

Illinois Power Agency 2022 Long-Term Plan (Final) August 23, 2022

In its Initial Plan, the Agency developed what it believes are reasonable proxies for each criterion.

188

In the Final Order approving the Initial Plan on April 3, 2018 in Docket No. 17-0838, the Commission

found the Agency’s methodology and assumptions for considering the eligibility of RECs sourced

from adjacent states to be reasonable. That approach remained the same for the First Revised Plan

approved by the ICC on February 18, 2020 in Docket No. 19-0995, and no party contested the First

Revised Plan’s approach through that proceeding. This approach, described in more detail below, is

generally unchanged in this 2022 Long-Term Plan.

While based conceptually on the same approach used for the Agency’s Zero Emission Standard

(“ZES”) Plan, the basis for determining compliance with the pollution and emissions public interest

criteria in this Plan is focused on the displacement of potential new non-renewable gas-fired

generation by renewable generation that could be eligible to supply RECs to meet the Illinois RPS

requirements. Among the differences from the ZES Plan scoring approach are that renewable

generating facilities are likely to be intermittent rather than baseload (a defining characteristic of

zero emission facilities), typically impact generation on the margin of the dispatch order, and are

generally smaller in size relative to the ZES replacement generation.

To assess whether a renewable generating facility located in an adjacent state is eligible to participate

in the IPA’s REC procurements to meet the Illinois RPS, the Agency assigns a maximum of 20 points

to each of the five public interest criteria, as described below, for a total of 100 possible points.

For a renewable energy generating facility in an adjacent state to have its RECs considered eligible

for the Illinois RPS, the adjacent state facility needs to demonstrate that it can achieve a total score of

at least 60 points for the Agency to approve that request. The IPA believes that this score threshold,

previously affirmed by the ICC in Docket No. 17-0838, provides a balanced approach to ensuring that

adjacent state facilities indeed provide sufficient benefits consistent with the law’s directive. This

score threshold requires a better than average score demonstrating benefits to the health, safety, and

welfare of Illinois residents, but yet not too onerous to prohibit any adjacent state participation.

For this 2022 Long-Term Plan, the Agency has reviewed and analyzed not only this scoring threshold,

but also the methodology for the consideration of adjacent state facilities. After review and analysis,

this scoring threshold and methodology (described further below) remains the same as presented in

the Initial Plan and First Revised Plan. However, the Agency has updated the data for the inputs

related to wind direction and duration used in the methodology.

The Agency also notes that there are two wind facilities in adjacent states that were the recipients of

contracts from the 2010 Long-Term Renewable Resources Procurement. One in Iowa has a contract

with Ameren, while one in Indiana has a contract with ComEd. As these facilities were granted

contracts at a time that Illinois law viewed them as providing sufficient benefits to Illinois residents

for their renewable energy resources to be used to meet the Illinois RPS, the Agency considers these

two facilities to be grandfathered into this requirement.

1. Minimizing sulfur dioxide, nitrogen oxide, particulate matter and other pollution that

adversely affects public health in this State

188

The Agency also developed a similar set of criteria for use in its Zero Emission Standard Procurement Plan (“ZES Plan”) developed

pursuant to Section 1-75(d-5) of the Act, which was approved by the Commission on September 11, 2017 in Docket No. 17-0333. That ZES

Plan includes consideration of how to minimize sulfur dioxide, nitrogen oxide, and particulate matter emissions that would result from the

potential closure of zero emission facilities (i.e., nuclear plants located in PJM or MISO).

Illinois Power Agency 2022 Long-Term Plan (Final) August 23, 2022

For the purposes of its Initial Plan (and maintained in this 2022 Long-Term Plan) and the

consideration of this criterion, the Agency refined and simplified the methodological approach

utilized in the ZES Plan. Under the ZES Plan, emissions are associated with replacement of generation

that can be located anywhere in PJM or MISO; for the purposes of this 2022 Long-Term Plan, the

Agency considers that a renewable energy facility would displace the emissions of a typical new

natural gas-fired combined-cycle generation facility.

In the ZES Plan, the Agency weighted replacement generation across multiple states, in recognition

that replacement generation for a large Zero Emission Facility would likely come from multiple

sources (replacement generation would be a combination of changed dispatch of existing generation

units as well as the potential development of new generating units).

189

The Agency simplified the

weighting for this criterion to focus on comparing emissions from renewable generation to the

emissions from a new natural gas-fired combined-cycle generating facility. This assumption reflects

the fact that recent and anticipated additions to the resource mix in PJM and MISO will be

predominantly natural gas, wind or solar

190

and natural gas is increasingly the fuel on the margin for

both PJM and MISO, and thus more appropriate for comparison than, say, a baseload coal facility.

191

As discussed below, this comparison is a relevant factor in the evaluation criteria for renewable

technologies that involve combustion (thus not including wind, solar, or hydro).

The emissions comparison includes sulfur dioxide (SO

) and nitrogen oxides (NO

) as proxies for all

emissions because higher emissions of SO

and NO

are generally correlated with higher emissions

of PM, especially with regard to facilities that involve the combustion of solid fuels. SO

and NO

are

primary emission sources for the formation of PM

2.5

in ambient air away from the immediate

emissions source. Larger PM (PM

) is deposited nearer the source, while secondary PM

2.5

increases

based on the formation of sulfates and nitrates from the SO

and NO

in the atmosphere as the

pollutants move away from the primary source.

192

The following table shows SO

, NO

, and CO

emissions rates of new natural gas-fired generation based upon 2019 data from the U.S. Energy

Information Agency (“EIA”).

193

189

Specifically, 33% of the replacement generation was assumed to be in the bidding zero emission facility’s own state, and the remaining

67% of replacement generation was assumed to occur across the relevant RTO, allocated by states based on each state’s share of RTO-wide

generation. ZES Plan, July 31, 2017, https://www.icc.illinois.gov/downloads/public/edocket/451223.pdf, at 37.

190

U.S. FERC, Office of Energy Policy and Innovation, Division of Energy Market Assessment, “State of the Markets 2020. A Staff Report to

the Commission,” March 18, 2021. “MISO Futures Report,” April 2021.

https://cdn.misoenergy.org/MISO%20Futures%20Report538224.pdf. Lustig, M. and Dholakia, G., S&P Global Market Intelligence,

“Outlook 2021: US planned capacity additions again led by solar, wind.” 26 April 2021.

191

See: Potomac Economics, “2020 State of the Market Report for the MISO Electricity Markets, Analytic Appendix” May 2021.

https://cdn.misoenergy.org/2020%20State%20of%20the%20Market%20Analytical%20Appendix552300.pdf; Monitoring Analytics,

LLC, “2020 State of the Market Report for PJM, Volume 2: Detailed Analysis.”

https://www.monitoringanalytics.com/reports/PJM_State_of_the_Market/2020/2020-som-pjm-vol2.pdf.

192

U.S. EPA, “Particulate Matter Emissions,” Report on the Environment, http://www.epa.gov/roe.

193

Emissions rates for a natural gas turbine operating in combined cycle with a heat rate of 6,431 Btu/kWh are shown in Table 7-3 of the

February 2020 U.S. EIA Report “Capital Cost and Performance Characteristic Estimates for Utility Scale Electricity Generating

Technologies.” The CO

emissions in pounds per MMBtu are 117 for CO2, 0.001 for SO

, and for NOx 0.0075; which at the heat rate of 6,431

Btu/kWh, are 752 pounds per MWh of CO

, 0.006 pounds per MWh of SO

, and 0.048 pounds per MWh of NOx. See:

https://www.eia.gov/analysis/studies/powerplants/capitalcost/pdf/capital_cost_AEO2020.pdf.. Typical emissions rates have not

changed since 2016, although the updated report shows that the new combined cycle generating plant heat rate has improved slightly.

Illinois Power Agency 2022 Long-Term Plan (Final) August 23, 2022

Table 4-1: Natural Gas-Fired Combined-Cycle Generation Emissions Rates

Pollutant

Pounds/MWh

0.006

0.048

752

The score is calculated by multiplying an emissions factor for the renewable resource facility (scaled

from 0 to 1) by a wind duration/direction factor (scaled from 0 to 1) and then by 20 points to

determine the number of points awarded for this criterion.

The emissions factor is calculated by taking one minus: the sum of the eligible renewable resource’s

and NO

emissions in pounds/MWh divided by the sum of the SO

and NO

emissions from a new

natural gas-fired combined-cycle generation facility in pounds/MWh.

The emissions factor for wind or solar generating facilities, which do not emit SO

, NO

, or Particulate

Matter, would be 1.0 because those facilities would have zero in the numerator of the part of the

equation that is subtracted from one. The focus of the competitive procurements covered in this

2022 Long-Term Plan is on utility-scale wind and solar projects as well as brownfield site solar

projects. Other renewable generating facilities including technologies that rely on combustion of a

renewable resource are not specifically addressed in the adjacent state eligibility requirements for

these competitive procurements.

The Zero Emission Standard Plan included consideration of wind direction and duration as well as

the distance from Illinois to modify the emissions criteria scoring. In scoring the emissions related

public interest criterion, the Agency and simplified the wind duration/direction approach compared

to what was utilized in the Zero Emission Standard Plan. For this 2022 Long-Term Plan, the IPA has

updated the wind data from what was used in the Initial and First Revised Plans. Since the renewable

generating facilities supplying RECs from outside of Illinois must be located in the states adjacent to

Illinois (as opposed to anywhere within PJM and MISO under the Zero Emission Standard), the

distance of the emission source from Illinois is less important for this Plan compared to the Zero

Emission Standard, and thus is not considered in the approach adopted for this 2022 Long-Term Plan.

The following table provides the wind duration/direction factors for each adjacent state.

Table 4-2: Wind Duration/Direction Factors

Adjacent State

Wind Direction Sectors

Wind Direction and

Duration Factor

194

Indiana

SSE, SE, ESE, E, NNE, NE, ENE

0.318

Kentucky

S, SSE, SE

0.213

Missouri

W, WSW, SW, SSW, S

0.460

Iowa

W, WNW, NW, NNW

0.253

Wisconsin

N, NNW

0.088

Michigan

NE, NNE

0.084

194

Total factors exceed 1.0 because there may be more than one state represented in a given wind direction sector.

Illinois Power Agency 2022 Long-Term Plan (Final) August 23, 2022

The wind duration factor is based on the percentage of the time the wind blows into Illinois from 16

directional sectors that form all of the directions in 360 degrees around Illinois. The wind direction

and duration factors were developed based on 25 years of consistent climatological data. On average

this data is relatively stable over time, although at some point in the future climate change could

impact the data underlying the determination of these factors. For example, the wind blowing from

Indiana would encompass seven directional sectors from which the wind blows on average 25.6

percent of the time. Thus, for example, a solar facility located in Indiana would receive 1 x 0.318 x 20

or 6.36 points. The following equation shows how this score is obtained (with the caveat that the

minimum possible score is zero and cannot be a negative score):

195

Figure 4-1: Pollution Score Calculation

20 /







































−=



F actorDirectionDurationWind

MWh

lbs

NOandSO

MWh

lbs

NOandSO

Score

resourcegas

resourcerenewable

The Agency’s review of the scoring methodology for this criterion showed that the analytical

approach remains valid for this 2022 Long-Term Plan. However, the wind duration/direction factors

have been updated to include 25 years of consistent data reported by the Illinois State Water Survey,

Water and Atmospheric Resource Monitoring Program from 17 reporting stations located around

the state for the years 1996 through 2020

196

(rather than the period 1996 through 2016 included in

the Initial and First Revised Plans).

2. Increasing fuel and resource diversity in this State

Fuel and resource diversity generally refers to the use of a balanced group of generating facilities and

technologies which results in reducing the risk that a specific technology could adversely impact

overall system reliability. For example, PJM defines fuel diversity as: utilizing multiple resource types

to meet demand such that a sufficiently diversified system is expected to provide the flexibility and

adaptability to: “1) mitigate risk associated with equipment design issues or common modes of

failure in similar resource types, 2) address fuel price volatility and fuel supply disruptions, and 3)

reliably mitigate instabilities caused by weather and other unforeseen system shocks.”

197

In effect,

fuel and resource diversity can act as a hedge to help ensure a stable and reliable supply of electricity.

Any generation source that promotes more reliance on generation sources other than coal and

nuclear, which in 2020 had generation shares of 17.9% and 57.8% of Illinois’ total generation

respectively,

198

would contribute to increasing fuel and resource diversity in Illinois. By this measure,

any of the eligible renewable energy resource generating technologies would contribute to diversity

in Illinois. However, if these facilities were located outside of Illinois, in the adjacent states, the full

195

See Docket No. 17-0838, Final Order dated April 3, 2018 at 21.

196

http://dx.doi.org/10.13012/J8MW2F2Q.

197

PJM, “PJM’s Evolving Resource Mix and System Reliability,” March 2017, available at: http://www.pjm.com/~/media/library/reports-

notices/special-reports/20170330-pjms-evolving-resource-mix-and-system-reliability.ashx.

198

U.S. EIA, “Electric Power Monthly with data for December 2020, February 2021.” The Agency notes that the share of coal declined from

38% and share of nuclear increased from 50.2% as reported in the Initial Plan. This is a net decline in the percentage of generation that

comes from coal and nuclear (88.2% to 76%), which indicates that the fuel and resource diversity of the state has increased.

Illinois Power Agency 2022 Long-Term Plan (Final) August 23, 2022

impact on the State’s fuel and resource diversity would depend on whether the electricity generated

by these facilities could actually be available to Illinois end-users.

Given that renewable generation accounts for only a relatively small fraction of the resource mix in

Illinois (10.2% of total generation in 2020),

199

an increase of renewable generation in the region may,

in theory, increase the fuel and resource diversity of Illinois. However, the Agency notes that Illinois

is a net exporter of electricity, so the impact on fuel and resource diversity in Illinois may be limited

for facilities located in adjacent states. While Illinois is a net exporter of electricity, that does not

mean that there is no impact on Illinois from electricity generated in adjacent states, because on an

hour-to-hour basis electricity may flow into, or out of, Illinois. To the extent that any electricity

generated outside of Illinois but consumed in the state is generated by resources other than coal or

nuclear, this generation is assumed to add to the fuel and resource diversity in Illinois.

In addressing this issue for facilities located in the adjacent states, the Agency uses the location of the

renewable resource facility relative to Illinois as the basis for modifying the fuel and resource

diversity score. A distance factor is calculated for each facility.

200

The distance factor is based on the

distance from the facility to Morris, Illinois (which is the city closest to the population weighted

geographic center of Illinois,

201

and thus can serve as a reasonable proxy for the load-weighted center

of the state). The factor is calculated as 1 minus the ratio of (i) the distance from the facility to Morris

and (ii) 470 miles, which is roughly the furthest point in an adjacent state from Morris. Consistent

with the Commission’s Order in Docket No. 17-0838, the center point of the City of Morris is used for

this calculation.

202

That factor is multiplied by the maximum possible 20 points to provide the score

for this criterion for potentially eligible renewable resource facilities located in adjacent states. The

fuel and resource diversity score formula is shown in Figure 4-2.

Additionally, consistent with the Commission’s Order in Docket No. 17-0838 and the approach taken

with respect to the third criterion below, a facility “that is not connected to either PJM or MISO” will

receive a Fuel and Resource Diversity Score of zero.

203

Adjacent state generation facilities “within a

transmission control area that have a transmission usage agreement with PJM or MISO” may still

receive non-zero scores under Criteria 2 and 3, however.

204

Figure 4-2: Fuel and Resource Diversity Score

199

Id.

200

Because wind farms cover a large geographic area, a wind farm’s distance would be based on the geographic center of the area containing

turbines that are part of that wind farm.

201

Based on the 2010 Census. See: https://www2.census.gov/geo/docs/reference/cenpop2010/CenPop2010_Mean_ST.txt.

202

See Docket No. 17-0838, Final Order dated April 3, 2018 at 21.

203

Id. The Commission also offered that “if a facility is not connected to PJM or MISO, it should not be allowed to participate in Illinois’ RPS

procurement;” the Agency believes that because such a facility would score 0 out of 20 points on Criteria 2 and 3 and given the 60 point

threshold, an adjacent state facility not connected to PJM or MISO would effectively be eliminated from consideration and no further scoring

adjustments must be taken to give effect to the Commission’s intent.

204

Id.

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

1   /, 0



1 

     , 







470 

 20

Illinois Power Agency 2022 Long-Term Plan (Final) August 23, 2022

100

3. Enhancing the reliability and resiliency of the electricity distribution system in this

State.

While this criterion references the “electricity distribution system” and that term is generally

understood to mean the local distribution system that serves homes and businesses and not the

transmission grid that transports power over longer distances (and across state lines), the Agency

was originally concerned that, read literally, there would be no direct way for a facility in an adjacent

state to meet this criterion because a facility in an adjacent state would have (at best) only an

incidental impact on the distribution system (or more accurately systems, each operated by a

different utility) within Illinois. With that in mind, the Agency has come to interpret this criterion

more expansively and instead considers the impact on the grid more generally, as distribution service

is ultimately supported by the reliability of transmission service. The scoring for this public interest

criterion involves a threshold and, based on the assumption that generating facilities located closer

to Illinois would have a more beneficial impact on the State’s distribution system reliability and

resiliency, a distance factor. The criterion can be understood to refer to the transmission systems

operated by PJM and MISO. To the extent that a facility in an adjacent state is not interconnected to

the PJM or MISO grid (for example, in the portions of Iowa and Missouri that are part of the Southwest

Power Pool(“SPP”)), those facilities would not score any points for this criterion. Otherwise, a facility

in an adjacent state that is in either of the PJM or MISO control areas (or “within a transmission

control area that has a transmission usage agreement with PJM or MISO”) would be eligible to receive

points. To obtain the distance factor, the Agency uses an approach that considers proximity to Illinois

and thus an increased likelihood that electricity produced will provide increased system reliability

and resilience.

The scoring for this public interest criterion involves the same distance factor as is applied to the fuel

and resource diversity scoring; the formula for determining this factor is shown in Figure 4-3. The

Agency’s review of the scoring methodology and assumptions for criteria 2 and 3 confirms that

distance is the factor which can be effectively incorporated into a simplified approach to determine

the relative contributions of RECs from adjacent state renewable resources to meeting these public

interest criteria.

Figure 4-3: Reliability and Resiliency Score

( )

miles 470

(miles) IL Morris, ofacility t from Distance

1 0 else PJM/MISO;in if 1 













−=Score

4. Meeting goals to limit carbon dioxide emissions under federal or State law

At the federal level, a range of legislative and regulatory approaches have been proposed to address

the carbon dioxide emissions associated with the generation of electricity using fossil fuels. On June

19, 2019, the U.S. EPA issued the Affordable Clean Energy Rule (ACE) as the replacement for the Clean

Power Plan. The ACE focused on heat rate improvements at individual coal-fired power plants as a

means to reduce CO

emissions by improving plant operating efficiency. ACE did not contain specific

emissions limits; instead, ACE provided guidelines for states to follow in limiting CO

emissions.

205

In January of 2021, the DC Circuit Court vacated ACE.

206

As of the finalization of this

205

https://www.epa.gov/stationary-sources-air-pollution/electric-utility-generating-units-repealing-clean-power-plan.

206

See: https://www.natlawreview.com/article/dc-circuit-vacates-trump-ace-rule-what-s-next-power-plant-co2-regulation.

Illinois Power Agency 2022 Long-Term Plan (Final) August 23, 2022

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2022 Long-Term Plan, mandated reductions in CO

emissions and clean energy standards remain a

topic of debate at the federal level.

At the state level, Illinois does not have a specific law that limits carbon dioxide emissions. However,

there are multiple provisions of Illinois law, such as the Zero Emission Standard and the Renewable

Energy Portfolio Standard, that recognize the value of minimizing carbon dioxide emissions even if

those provisions do not create explicit limits. P.A. 102-0662 also makes extensive references to the

consideration of carbon emission reductions and the benefits associated with reducing these

emissions. To recognize the value in reducing carbon dioxide emissions, the Agency determines the

score for each renewable resource facility by adjusting the 20 points available for this criterion by a

factor which reflects the ratio of the CO

emissions from the renewable resource to the CO

emissions

from a new natural gas-fired combined cycle generating facility, 752 pounds of CO

per MWh, as

shown in Table 4-1 above. This is done by using the formula applied to the first emissions criterion

except that the inputs are pounds of CO

emitted per MWh. The factor applied to the 20 points

available for this public interest criterion is calculated as follows:

Figure 4-4: CO

Score Calculation

MWh

lbs

MWh

lbs

resource

gas

resource

renewable







































−=

Score

Renewable generating facilities that do not emit any CO

receive the full 20 points, while renewable

generating facilities that emit CO

receive points based on the factor multiplied by the 20 points.

Because CO

emissions are generally considered to be a global problem (in that CO

emissions

anywhere on the planet contribute to global warming, which then affects the health and welfare of

the citizens of Illinois), wind direction, duration, and distance from Illinois’s load-weighted center

are not relevant for the scoring of this criterion and therefore are not included in the calculation.

207

Comparing the CO

emissions from each renewable resource to the emissions from the most likely

alternative generation, usually a gas-fired combined-cycle plant, remains a practical means for

determining the score for this criterion.

5. Contributing to a cleaner and healthier environment for the citizens of this State

This criterion is arguably the most subjective in nature, and presents unique challenges given that

the Agency strives to use objective approaches to the greatest extent possible when considering the

public interest criteria. The Agency believes that renewable resources inherently contribute to a

cleaner and healthier environment generally (with the caveat related to emissions from renewable

resources that involve combustion, discussed above) because they reduce the reliance on fossil fuels

and have no safety issues associated with the containment and disposal of radioactive materials that

result from nuclear generation. Under this 2022 Long-Term Plan, the points awarded for this public

interest criterion are the average of the points awarded under the first and fourth public interest

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The Agency notes that the Zero Emission Standard Plan contains a different scoring methodology for CO

emissions, but that

methodology is based upon the impacts of replacement generation and the consideration related to “minimizing carbon dioxide emissions

that result from electricity consumed in Illinois” (20 ILCS 3855/1-75(d-5)(1)(C)), which is not the same standard as under consideration

in qualifying adjacent-state facilities for the RPS.

Illinois Power Agency 2022 Long-Term Plan (Final) August 23, 2022

102

criteria described above. This approach takes into account the emissions from renewable resource

facilities that involve combustion and, subsequently, emissions, which would not contribute to a

cleaner and healthier environment for the citizens of Illinois.

4.4. Cost Recovery Requirement

Section 1-75(c)(1)(J) of the Act contains the following provision:

In order to promote the competitive development of renewable energy resources in

furtherance of the State's interest in the health, safety, and welfare of its residents,

renewable energy credits shall not be eligible to be counted toward the renewable

energy requirements of this subsection (c) if they are sourced from a generating unit

whose costs were being recovered through rates regulated by this State or any other

state or states on or after January 1, 2017.

Generally speaking, the Agency understands that facilities owned by a rural electric cooperative, or

a municipal utility are not impacted by this criterion (as in Illinois, those entities’ rates are not

regulated by this state or any other), although the Agency notes that there are certain adjacent states

which regulate some rural electric cooperative and municipal utility rates. Therefore, the Agency

cannot issue a blanket approval under this provision of facilities owned by rural electric cooperatives

or municipal utilities service territories in adjacent states; rather, as those facilities request eligibility,

their rate recovery status will be reviewed.

The Agency also understands that this provision was primarily intended to ensure that facilities

owned by a vertically integrated utility, for which REC revenues may be incidental to building and

financing the facility (as that facility’s costs could be recovered from ratepayers in that other state,

potentially resulting in a credit or discount to those ratepayers for any REC revenues—effectively

causing Illinois ratepayers to cross-subsidize those in vertically integrated states) would not be

eligible. Another situation that has been brought to the Agency’s attention concerns a proposed

project to be developed by an Illinois non-electric utility (a gas or water utility, for instance) featuring

delivery service rates that are regulated by the Illinois Commerce Commission with cost recovery

then sought over the cost of the renewable energy generating facility. Regardless of whatever may

have been the primary purpose informing Section 1-75(c)(1)(J)’s enactment, this situation would

seem to clearly fit Section 1-75(c)(1)(J)’s prohibition: the renewable generation facility’s costs would

be recovered through state-regulated rates. Consequently, the IPA understands such projects’ RECs

as being barred from participation in the Illinois RPS (including in, say, the Adjustable Block

Program) insofar as rate recovery is sought for those projects.

On the other hand, the mere presence of a Power Purchase Agreement between a facility and a

separate utility whose costs are recovered in regulated rates would not trigger these criteria (nor

would participation in the IPA’s energy procurement events, for which regulated utilities serve as

contractual counterparties, or participation in a net metering or similar energy crediting program,

which would serve to disqualify the very facilities that other portions of the Illinois RPS work to

support). Likewise, the Agency believes that being a Qualifying Facility under the Public Utility

Regulatory Policies Act (“PURPA”)

208

(and also meeting the other aspects of the requirements of the

Illinois RPS), would not be disqualifying because the Qualifying Facility does not directly recover its

208

16 U.S.C. §§ 796(17), 824a-3, 824i.

Illinois Power Agency 2022 Long-Term Plan (Final) August 23, 2022

103

costs through rates; rather, it is compensated for its energy at the purchasing utility’s avoided cost

rate.

Facilities located in adjacent states must proactively request eligibility for the utility’s RPS pursuant

to the public interest criteria standard explained above. Those requests to meet the public interest

criteria are required to include a notarized certification, and documentation, that the facility does not

have its costs recovered through regulated rates. For a distributed generation facility, simple

documentation of ownership will suffice. For larger facilities, the Agency has not utilized a firm

standard of documentation but believes there are multiple approaches that could be used by a

requesting facility. These include, but are not limited to:

• For facilities tracked in M-RETS, documentation to support the status listed in the “Facility

Ownership Type” field

• A Market Based Rate authorization letter from the Federal Energy Regulatory Commission

that demonstrates that the facility owner is not a utility with costs recovered through

regulated rates

• Certification as a Qualifying Facility

• Use of information from other sources such as the S&P Global Intelligence Briefing Book, or

the Platts UDI Directory of Electric Power Producers and Distributors

The Agency will review (in consultation with the ICC) information provided for a facility, and may, as

needed, request additional information to verify a facility’s status.

In addition to the screening process described above, all contracts from IPA-administered REC

procurements or programs utilized since the effective date of P.A. 99-0906 contain provisions to

reflect this additional requirement of Section 1-75(c)(1)(J) (and will continue to do so going

forward):

Each contract executed to purchase renewable energy credits under this subsection (c)

shall provide for the contract's termination if the costs of the generating unit supplying

the renewable energy credits subsequently begin to be recovered through rates

regulated by this State or any other state or states; and each contract shall further

provide that, in that event, the supplier of the credits must return 110% of all payments

received under the contract. Amounts returned under the requirements of this

subparagraph (J) shall be retained by the utility and all of these amounts shall be used

for the procurement of additional renewable energy credits from new wind or new

photovoltaic resources as defined in this subsection (c). The long-term plan shall provide

that these renewable energy credits shall be procured in the next procurement event.

The Agency notes that Section 1-75(c)(1)(J) also provides a limited exception to this provision for

facilities that participate in the Illinois Solar for All Program outlined in Section 1-56 of the Act:

Notwithstanding the limitations of this subparagraph (J), renewable energy credits

sourced from generating units that are constructed, purchased, owned, or leased by an

electric utility as part of an approved project, program, or pilot under Section 1-56 of

this Act shall be eligible to be counted toward the renewable energy requirements of this

subsection (c), regardless of how the costs of these units are recovered.

Illinois Power Agency 2022 Long-Term Plan (Final) August 23, 2022

104

4.5. High-Voltage Direct Current Transmission Lines and Converter Stations

P.A. 102-0662 features multiple revisions to Section 1-75(c)(1)(I) and (J) intended to support utility-

scale renewable energy projects utilizing high-voltage direct current (“HVDC”) transmission lines

and converter stations, providing a more expansive approach to qualifying adjacent state generating

facilities than previously employed under Section 1-75(c)(1)(I) when certain criteria are met.

Section 1-75(c)(1)(I) contains two changes resultant from P.A. 102-0662.

1. If (i) a new HVDC transmission line ends at a converter station located in Illinois and

interconnected in the region of the PJM interconnection, (ii) was constructed using a project

labor agreement, (iii) is capable of transmitting electricity at 525 kV, (iv) does not operate as

a public utility, and (v) was energized after June 1, 2023, then the RECs associated with any

renewable energy transmitted over that HVDC transmission line with a verified customer in

Illinois will be deemed to have been sourced from a generation facility in Illinois for purposes

of RPS qualification. This would make those RECs eligible for competitive procurements

conducted by the IPA, even if the underlying generating facility itself was not located in

Illinois (or an adjacent state) and could not meet the scoring threshold outlined above.

209

At present, there are no new HVDC transmission lines with converter stations located in

Illinois in operation, although there currently is a proposed project which could potentially

meet the requirements.

210

2. Revisions to Section 1-75(c)(1)(I) also clarify that the Agency may qualify RECs “associated

with the electricity generated by a utility-scale wind energy facility or utility-scale

photovoltaic facility and transmitted by a qualifying direct current project described in

subsection (b-5) of Section 8-406 of the Public Utilities Act to a delivery point on the electric

transmission grid located in this State or a state adjacent to Illinois,”

211

but only if this

Chapter’s public interest criteria scoring is satisfied. As that electricity must be transmitted

to “a delivery point . . . located in this State or a state adjacent to Illinois,” the IPA’s first-blush

interpretation is that this delivery point should be treated as the location of the generating

facility in public interest criteria scoring. While the Agency appreciates that this

interpretation may allow for participation from utility-scale wind and solar projects located

further from Illinois than would otherwise be allowed (and those projects may offer lesser

benefits back to Illinois residents and businesses), utilizing the location a of wind or solar

project for public interest scoring would render this new statutory language meaningless, as

projects utilizing qualifying direct current projects would be treated equivalently to those

that did not.

209

However, that facility would not be eligible if the generating facility’s costs were recovered through state-regulated rates, as that

prohibition remains in effect even for in-state generation.

210

The proposed SOO Green HVDC Link is a 350-mile, 2,100 MW, 525 kV underground HVDC transmission line which would run from

Mason City, IA to Plano, IL along railroad rights-of-way. Subject to permitting and interconnection issues, the line is projected to begin

construction in 2023 and go into operation in 2026.

211

Section 8-406(b-5) of the PUA defines a “qualifying direct current project” as a "high voltage direct current electric service line that

crosses at least one Illinois border, the Illinois portion of which is physically located within the region of the Midcontinent Independent

System Operator, Inc., or its successor organization, and runs through the counties of Pike, Scott, Greene, Macoupin, Montgomery, Christian,

Shelby, Cumberland, and Clark, is capable of transmitting electricity at voltages of 345kv or above, and may also include associated

interconnected alternating current interconnection facilities in this State that are part of the proposed project and reasonably necessary

to connect the project with other portions of the grid.”

Illinois Power Agency 2022 Long-Term Plan (Final) August 23, 2022

105

Section 1-75(c)(1)(J) contains only one change enacted through P.A. 102-0662, now stating that “[a]s

long as a generating unit or an identifiable portion of a generating unit has not had and does not have

its costs recovered through rates regulated by this State or any other state, HVDC renewable energy

credits

212

associated with that generating unit or identifiable portion thereof shall be eligible to be

counted” under the Illinois RPS. The IPA understands this language as clarifying that, for HVDC

renewable energy credits, whether the underlying generating facility has its costs recovered through

state-regulated rates is what carries an RPS eligibility prohibition under subparagraph (J), but not

whether the HVDC transmission line or converter station has its costs recovered through state-

regulated rates.

4.6. Application Process

The eligibility of RECs from renewable energy generating facilities located in states adjacent to

Illinois is not automatically granted, because the Act requires that approval comes only after “the

generator demonstrates and the Agency determines” that the facility’s operation meets the public

interest criteria discussed above.

213

That determination requires an active request (demonstration)

by an interested generator. Renewable generating facilities in adjacent states may apply to the

Agency for consideration for eligibility for the RPS.

214

Shortly after the approval of its Initial Plan, the Agency developed an application form (in the form

of an Excel spreadsheet) for use by owners/agents of adjacent-state facilities that wish to have RECs

from those projects considered to be eligible for the Illinois RPS.

215

The information to be entered

into the application form includes the generating technology (including information on emissions

rates if the technology involves combustion), state where the generator is located, distance from the

geographical center of Morris, IL, the Regional Transmission Organization (“RTO”) where the facility

is interconnected or is planned to be interconnected (e.g., PJM, MISO, SPP), and the tracking system

ID (for existing facilities). The application form automatically calculates the score for the facility. In

addition, the generator must also include information related to the provision limiting the recovery

of costs in rates described in this chapter.

As discussed above, the Agency will continue to review and, as necessary, update the data used in the

eligibility calculations on a bi-annual basis in conjunction with the new Plan update to use the most

recent available inputs (and has done so for this 2022 Long-Term Plan, determining that minor

changes are needed for the wind direction/duration factors), but a facility’s determination of

eligibility will be based on the data available at the time of the request for determination (in other

words, a facility would not risk having its eligibility revoked at a later date if the inputs changed after

the initial eligibility determination is made by the Agency).

The Agency will review applications to verify the information submitted (e.g., confirming the distance

inputs), and if the facility has a score equal to or greater than 60 points (and meets the cost recovery

requirement found in Section 1-75(c)(1)(J) of the Act, discussed further below), the Agency will

212

Section 1-10 of the IPA Act defines “HVDC renewable energy credits” as RECs “associated with a renewable energy resource where the

renewable energy resource has entered into a contract to transmit the energy associated with such renewable energy credit over high

voltage direct current transmission facilities.”

213

20 ILCS 3855/1-75(c)(1)(I).

214

An exception is made for the out-of-state facilities that have LTPPA contracts with the utilities. As discussed in Section 4.3, those facilities

are grandfathered in and remain eligible to provide RECs for compliance with the Illinois RPS.

215

Available at: https://ipa.illinois.gov/content/dam/soi/en/web/ipa/documents/Il-rps-adjacent-state-facility-determination-eligibility-

15-Aug-2022.xls.

Illinois Power Agency 2022 Long-Term Plan (Final) August 23, 2022

106

approve the facility as eligible to produce renewable energy credits for compliance with the Illinois

RPS. The Agency will inform the applicable tracking system (GATS or M-RETS) that the facility should

be coded as Illinois RPS eligible.

For facilities seeking to qualify by virtue of RECs associated with electricity transmitted across

qualifying HVDC lines or transmitted to an HVDC converter station in Illinois, the Agency is still

assessing what demonstration is necessary for qualification. As the Agency would no longer be

assessing the physical location of a project and would instead be making determinations around RECs

associated with electricity transmitted to a certain point and in a certain manner, the Agency is

continuing to assess how this new approach to RPS qualification can be integrated into its source-

specific competitive procurement processes. Until that process is formalized – and noting that

applicable HVDC lines and transmission stations are apparently in the early stages of development –

those requests will be handled within the context of individual procurement event qualification.

216

In the case of a new adjacent-state facility that is not yet operational (and thus also not registered in

GATS or M-RETS), an owner may submit a request for determination of eligibility based upon the

planned design of the facility. If the Agency determines that the planned facility does meet the public

interest criteria, then it will grant a pre-approval of the eligibility. It is the responsibility of the facility

owner to notify the IPA and the tracking system once the facility is operational to request being coded

as eligible for the Illinois RPS in the applicable tracking system. The Agency will review final system

information to verify consistency with the information submitted for the pre-approval.

216

Perhaps notably, no party sought additional clarity around those HVDC-related qualification processes in ICC Docket No. 22-0231, the

Commission’s proceeding approving this 2022 Long-Term Plan.

Illinois Power Agency 2022 Long-Term Plan (Final) August 23, 2022

107

5. Competitive Procurements

The Agency is charged with developing procurement plans and conducting competitive procurement

processes in accordance with the requirements of Section 1-75 of the IPA Act and Section 16-111.5

of the PUA. The competitive procurement process is applicable to the events held by the Agency to

obtain RECs from utility-scale wind, utility-scale solar and brownfield site photovoltaic resources.

While the term “competitive procurement event” is not specifically defined in the IPA Act or the PUA,

the Agency understands the term “competitive procurement event” to be an element of, or

commensurate with a “competitive procurement process.”

This Chapter addresses requirements applicable to those competitive procurement processes,

including changes to those processes necessitated by changes in Illinois law made through Public Act

102-0662. Among those changes are increases in RPS budgets and targets as outlined in Chapter 3

(and thus corresponding increases in procurement quantities from competitive procurement

events), modifications to permissible bid application and evaluation requirements for supporting

projects located in Energy Transition Community Grant areas and projects supporting equity eligible

contractor participation, new labor requirements applicable to project development (including

project labor agreements required for participating projects), and a new Indexed REC pricing

approach through which REC prices float up or down based on indexed wholesale energy market

prices, ensuring stable revenues across the delivery term of a REC delivery contract.

Throughout this Chapter, the competitive procurements conducted by the Agency are termed as

“forward procurements,” as they are procurements that have a delivery date in the future and the

contract term is for multiple years.

5.1. Background - Agency Approach in Past Procurements

The procurement approach the Agency has used for prior REC procurements, including the Initial

Forward Procurements and the forward procurements conducted under the Initial and First Revised

Plans, stems from the approach laid out in Section 16-111.5 of the Public Utilities Act for “standard

wholesale product” (i.e., block energy, capacity, etc.) procurements.

This process has traditionally included the following key provisions, although modifications to

governing law through P.A. 102-0662 will result in changes from certain aspects of this approach;

those modifications are discussed later in this Chapter:

• Standard contracts and credit provisions

• Sealed bids with pay-as-bid settlement

• Use of confidential benchmarks to eliminate bids not consistent with the market

• Bid selection based on price

• No post-bid negotiations

• Procurement Administrator evaluates bids and provides confidential recommendation to the

Commission for approval

• Procurement Administrator provide bidder interface including training

• Uniform/standardized bid forms

• Uniform/standardized/harmonized credit requirements

• Procurement Monitor involvement

Illinois Power Agency 2022 Long-Term Plan (Final) August 23, 2022

108

These provisions define a procurement process that has multiple stages.

• The Procurement Administrator develops draft contracts in consultation with the utilities,

the Agency, the Procurement Monitor,

217

and ICC Staff.

• Draft contracts are released for public comment.

• The Procurement Administrator, the Agency, the utilities, ICC Staff and the Procurement

Monitor review all comments received on the draft contract and revise the contract as

needed.

218

• Typically, the Procurement Administrator holds an informational webcast upon release of

the final contracts and RFP rules.

• Submission of Proposals is in two parts:

o Part 1 for pre-qualification – allows bidders to provide basic information and agree

to the terms of the contract and the RFP rules.

o Part 2 for registration of bidders – allows bidders to update information, make

additional certifications including regarding confidentiality of bidding information,

and post bid assurance collateral.

• Bids – on the bid date, bidders submit bids using a standardized bid form.

• Evaluation of Bids – the Procurement Administrator evaluates bids based on price,

procurement objectives and priorities; identifies the winning bids; prepares a

recommendation for the Commission. The Procurement Monitor observes the bidding and

evaluation process and makes its own recommendation.

219

• Commission decision – After review of the Procurement Administrator’s and Procurement

Monitor’s reports and recommendations, the Commission renders a decision on the results

of the procurement event.

220

• Release of procurement results – The Procurement Administrator releases the results of the

procurement event; confidential information is protected.

221

• Contract execution with the utilities – Within three business days of Commission approval of

the procurement results, utilities and winning bidders sign binding contractual arrangements

using the standard form contracts.

222

As Section 1-75(c)(1)(G)(vi) of the Act continues to require that competitive procurements “shall

follow the procurement processes and procedures described in this Section and Section 16-111.5 of

the Public Utilities Act to the extent practicable,” the competitive procurements for RECs described

in the 2022 Long-Term Plan will continue to follow this approach where not modified by new

requirements of Illinois law.

217

The Procurement Monitor is an independent consultant that works on behalf of the Commission to oversee all aspects of the

procurement process. 220 ILCS 5/16-111.5(c)(2).

218

If agreement between the Procurement Administrator and the utilities is not reached on the terms and provisions of the contracts, any

disputes are resolved by the Commission. (See 220 ILCS 5/16-111.5(e)(2)).

219

See 220 ILCS 5/16-111.5(f).

220

See id.

221

See 220 ILCS 5/16-111.5(h).

222

See 220 ILCS 5/16-111.5(g).

Illinois Power Agency 2022 Long-Term Plan (Final) August 23, 2022

109

5.2. Past REC Procurements conducted by the IPA

5.2.1. Procurements Conducted Prior to P.A. 99-0906

The Agency’s pre-P.A. 99-0906 competitive procurements for renewable energy resources are listed

below (with the delivery quantities of RECs procured listed in some cases):

223

• Spot Procurements for one-year delivery of RECs

o 2009 REC procurements for Ameren Illinois and ComEd (720,000 RECs for Ameren

Illinois, 1,564,360 RECs for ComEd)

o 2010 REC procurements for Ameren Illinois and ComEd (860,860 RECs and

1,887,014 RECs for Ameren Illinois and ComEd, respectively)

o 2011 REC procurements for Ameren Illinois and ComEd (952,145 and 2,117,054

RECs)

o 2012 REC procurements for Ameren Illinois and ComEd (523,376 RECs and

1,335,673 RECs)

o 2015 SREC procurements for Ameren Illinois and ComEd (30,212 SRECs and 49,770

SRECs)

o 2016 SREC procurements for Ameren Illinois and ComEd (33,271 SRECs and 67,952

SRECs)

o 2016 REC procurement for MidAmerican

• Procurements for multiple delivery years of RECs

o 2010 Long-term procurements for Ameren Illinois and ComEd (20 year contracts,

bundled RECs and energy, 600,000 RECs per year and 1,261,725 RECs per year,

respectively)

o 2012 “Rate Stability” procurement for Ameren Illinois and ComEd (contracts for four

years and seven months) (2,053,837 RECs over the delivery term, and 2,737,110

RECs over the delivery term, respectively)

o 2015 Supplemental Photovoltaic procurements using the RERF (5 year contracts,

with provision to allow time for identification of under 25 kW systems) (21,436

SRECs per year)

o 2015 Distributed Generation procurement for Ameren Illinois and ComEd (5 year

contracts)

o 2016 Supplemental Photovoltaic procurement using the RERF (5 year contracts, with

provision to allow time for identification of under 25 kW systems) ( 18,354 SRECs per

year)

o 2016 Distributed Generation procurement for Ameren Illinois and ComEd and

MidAmerican (5 year contracts)

o 2017 Distributed Generation procurements (5 year contracts, also include provision

to allow time for identification of under 25 kW systems) (19,025 SRECs per year

procured in Spring 2017, 8,153 SRECs per year procured in Fall 2017)

223

Announcements of these procurements that contain additional information can be found at: https://ipa.illinois.gov/energy-

procurement/prior-approved-plans.html. Certain REC volume information has been redacted to maintain required confidentiality in

accordance with 220 ILCS 5/16-111.5(h). Please note that because initial delivery timelines vary, the “per year” numbers may not be 100%

accurate for a specific calendar period.

Illinois Power Agency 2022 Long-Term Plan (Final) August 23, 2022

110

As these procurements were conducted prior to modifications in P.A. 99-0906 providing for

centralized budgeting, planning, and procurements conducted by the IPA to serve all retail customer

load, these procurements were generally only funded through either eligible retail customers

(default supply customers) or the State of Illinois. Some of these procurements, especially the

LTPPAs, still provide RECs that are used to help meet Section 1-75(c)(1)(B)’s RPS goals, although

RECs from systems energized prior to June 1, 2017 cannot be utilized to meet Section 1-75(c)(1)(C)’s

targets for the procurement of RECs from new projects.

5.2.2. Procurements Conducted After P.A. 99-0906

With the enactment of Public Act 99-0906, the Agency began conducting procurements to meet RPS

requirements applicable to all retail customer sales. The first such procurements were the Initial

Forward Procurements, conducted prior to the finalization of the Initial Plan.

224

After the Initial

Plan’s approval, the Agency conducted a series of procurements conducted under the Commission’s

authority granted through its Order approving that Plan in Docket No. 17-0838. Those procurements

are listed below:

• 2017 and 2018 Initial Forward Procurements (15 year contracts for new utility-scale wind

and new utility-scale solar, 965,000 Wind RECs and 1,000,000 Solar RECs per year procured)

• October 2018 First Subsequent Forward Procurement (15 year contracts for new utility-scale

wind, 1,979,753 RECs procured)

• November 2018 Photovoltaic Forward Procurement (15 year contracts for new utility-scale

solar, 2,000,000 RECs)

• July 2019 Brownfield Site Forward Procurement (15 year contracts, quantity not released

due to only two projects selected)

• Second Subsequent Forward Procurement (15-year contracts for new utility-scale wind).

Two procurement events, conducted October 2019 and March 2021, No bids were accepted

in either procurement;

• Community Renewable Generation Procurement (15-year contracts for non-PV renewable

technologies). No bids were accepted;

• Low-income Community Solar Pilot Project Procurement (15-year contracts; conducted

pursuant to Section 1-56(b)(2)(D) of the Act)

The original Brownfield Site Forward Procurement was conducted in the fall of 2018 and did not

feature any winning projects. In February of 2019, the Agency sought feedback

225

from stakeholders

and then petitioned the Commission to reopen Docket No. 17-0838 seeking clarification for the

authority to reconduct the procurement with certain modifications. Following the Commission’s

approval of that request, the second Brownfield Site Forward Procurement was then conducted in

spring/early summer 2019 with the Commission approving the results on August 1, 2019. While the

specific quantity procurement in the brownfield site procurement was not disclosed given that only

two bidders were successful,

226

the procurement did exceed the then-applicable statutory target of

224

See 20 ILCS 3855/1-75(c)(1)(G)(i), (ii).

225

See https://ipa.illinois.gov/content/dam/soi/en/web/ipa/documents/2019procurementplan/brownfield-site-procurement-

questions-5-feb-2019-1.pdf.

226

By releasing quantity information in a procurement with two winning bidders, each bidder would be able to determine the quantity of

the other’s selected bid, and thus determine that other bidder’s bid price.

Illinois Power Agency 2022 Long-Term Plan (Final) August 23, 2022

111

40,000 RECs annually by the 2020-2021 delivery year (although such RECs could begin being

delivered after that date under the procurement’s contracts) but did not meet the then-applicable

60,000 REC procurement target for the 2025-26 delivery year.

The Second Subsequent Forward Procurement (new utility-scale wind), Community Renewable

Generation Forward Procurement (non-photovoltaic), and the Low-income Community Solar Pilot

Project Procurement (part of Illinois Solar for All) were all conducted in the Fall of 2019. Both the

Second Subsequent Forward Procurement and the Community Renewable Generation Forward

Procurement

227

did not produce any winning bids. Consistent with the Commission’s Order in Docket

No. 19-0995,

228

the Agency conducted an additional procurement event for RECs from new utility-

scale wind projects in the Spring of 2021; however, no bids were selected.

229

Based on challenges outlined in comments received after the conclusion of unsuccessful new utility-

scale wind procurement events – namely, the inability to obtain a bundled REC and energy contract

through the IPA, the paucity of long-term energy-only off-takers for geographically-qualifying new

utility-scale wind and solar projects, and the risks inherent with fixed price REC revenues against

potentially volatile wholesale energy market prices – the Agency is hopeful that many of these

challenges have been addressed through the shift to an Indexed REC price contract structure.

230

Further discussion of that structure is found in Section 5.7 below.

The table below provides an outline of those competitive procurements conducted between the

enactment of Public Act 99-0906 and Public Act 102-0662. This includes both the statutorily required

Initial Forward Procurements which were conducted prior to the approval of the Initial Long-Term

Plan as well as procurements authorized in Long-Term Plans:

227

The community renewable generation forward procurement was for non-solar community renewable generation, which the Agency

anecdotally understands may be a challenging technological and financial proposition given the 2 MW statutory size limit on community

renewable generation projects.

228

See Docket No. 19-0995, Final Order dated February 18, 2020 at 17-18.

229

See https://www.ipa-energyrfp.com/2018-2019-2021-subsequent-forward-procurements/ for additional information.

230

Comments can be found here: https://ipa.illinois.gov/energy-procurement/wind-comments-2020.html.

Illinois Power Agency 2022 Long-Term Plan (Final) August 23, 2022

112

Table 5-1: 2017-2021 Competitive Procurements Summary

231

Procurement

Technology

Procurement

Date

Annual

REC

Target

Annual RECs

Procured

Annual

Spend $

Status

232

Initial Forward

Wind (utility-

scale)

Summer 2017

1 million

0.965 million

3.4 million

2 projects completed

Initial Forward

Photovoltaic

(utility-scale and

brownfield site)

Summer 2017

and Spring

2018 (three

events)

1 million

5.9 million

4 projects completed,

1 terminated

First Subsequent

Forward

Wind (utility-

scale)

Fall 2018

2 million

1.98 million

233

6.41 million

2 projects completed,

2 terminated

Brownfield Site

Forward

234

Photovoltaic

(brownfield site)

Fall 2018

/Summer

2019

235

0.08

million

Quantity not

disclosed

Not

disclosed

1 project completed,

1 still under development

Photovoltaic

Forward

Photovoltaic

(utility-scale)

Fall 2018

2 million

9.28 million

2 projects completed,

4 still under development,

3 terminated

Second

Subsequent

Forward

Wind (utility-

scale)

Fall 2019

1 million

N/A

Community

Renewable

Generation

Program

Forward

Any non-

photovoltaic

(with

subscribers)

Fall 2019

0.05

million

N/A

Low-Income

Community

Solar Pilot

Project

236

Photovoltaic

(with

community

participation /

subscribers)

Fall 2019

Set on a

$20

million

budget

Quantity not

disclosed

Not

disclosed

2 projects still under

development

Utility-scale

Wind Forward

Procurement

Wind (utility-

scale)

Spring 2021

1 million

N/A

231

15-year REC delivery term from new generating facilities.

232

Completed projects have begun REC deliveries; projects still under development have received extensions on their initial REC delivery

dates, and terminated projects are projects that have been removed from REC delivery contracts for not having met their initial REC

delivery date deadline.

233

As allowed under the procurement rules, the marginal bidder declined an award of 0.02 million RECs which would have represented a

very small portion of their RECs bid and thus was not economically feasible.

234

The procurement had only two winning bidders therefore certain information is not disclosed per previous Commission Orders in order

to maintain bidder confidentiality. By releasing quantity information in a procurement with two winning bidders, each bidder would be

able to determine the quantity of the other’s selected bid, and thus determine that other bidder’s bid price

235

When originally conducted in 2018, the Brownfield Site Forward Procurement did not procure any RECs and a procurement was

conducted a second time in the Summer of 2019.

236

The procurement had only two winning bidders therefore certain information is not disclosed per previous Commission Orders in order

to maintain bidder confidentiality. By releasing quantity information in a procurement with two winning bidders, each bidder would be

able to determine the quantity of the other’s selected bid, and thus determine that other bidder’s bid price

Illinois Power Agency 2022 Long-Term Plan (Final) August 23, 2022

113

5.3. Statutory Requirements

Requirements applicable to competitive procurements conducted by the IPA can be found in Section

16-111.5 of the PUA and Section 1-75 of the IPA Act. Requirements applicable to this Plan’s content

are generally included in the PUA; those are outlined below.

Section 16-111.5(b)(5)(ii)(B)(aa) of the PUA requires that this Plan:

“Identify the procurement programs and competitive procurement events consistent

with the applicable requirements of the Illinois Power Agency Act and shall be designed

to achieve the goals set forth in subsection (c) of Section 1-75 of that Act.”

The “competitive procurement events” contemplated by the IPA are discussed in this Chapter, while

the “procurement programs” are discussed in Chapters 7 and 8. Also specifically addressed in this

chapter is the following additional provision (bb) of that subsection of the Act regarding REC

procurements subsequent to the Initial Forward Procurement:

“Include a schedule for procurements for renewable energy credits from utility-scale

wind projects, utility-scale solar projects, and brownfield site photovoltaic projects

consistent with subparagraph (G) of paragraph (1) of subsection (c) of Section 1-75 of

the Illinois Power Agency Act.”

Section 16-111.5(b)(5)(iii) further states that,

“For those renewable energy credits subject to procurement through a competitive bid

process under the plan or under the initial forward procurements for wind and solar

resources described in subparagraph (G) of paragraph (1) of subsection (c) of Section

1-75 of the Illinois Power Agency Act, the Agency shall follow the procurement process

specified in the provisions relating to electricity procurement in subsections (e) through

(i) of this Section.”

In addition, Section 16-111.5(e)-(i) includes requirements applicable to competitive procurement

events, many of which are outlined in Section 5.1 above. Section 1-75(c)(1)(G)(vi) incorporates those

requirements into competitive REC procurement events “to the extent practicable.” The Agency has

generally found those requirements practicable to include, although new changes to Section 1-

75(c)(1)(G)(v), 1-75(c)(1)(P), and 1-75(c-10) of the IPA Act may require additional deviation from

Section 16-111.5’s procurement process. Additional discussion of changes to the competitive

procurement structure necessitated by these changes in law can be found below.

The Agency has achieved generally positive results in past experience with this competitive bid

process. REC delivery prices have proven competitive, thus reducing the budget impact of supporting

new project development, and most procurements have resulted in targeted procurement quantities

being met. However, the attrition rate for projects awarded REC delivery contracts through

competitive procurements has been suboptimal—at the time of the Plan’s filing, in the range of 20-

25% attrition, as compared to attrition of less than 10% across all ABP categories. The Agency is

hopeful that additional changes found in P.A. 102-0662 will reduce that attrition rate further by

reducing development risk and ensure that prices remain low by reducing risk premiums build into

bids, while also achieving important qualitative objectives by supporting a diverse, inclusive,

equitable, and fairly compensated workforce.

Illinois Power Agency 2022 Long-Term Plan (Final) August 23, 2022

114

5.4. New Requirements under P.A. 102-0662

The increased RPS goals, procurement targets, and funding associated with Public Act 102-0662 will

expand the Agency’s procurement of RECs from new utility-scale wind, new utility-scale solar, and

new brownfield-site photovoltaic projects. The new targets include 10 million RECs from new solar

and wind projects delivered annually by the end of the 2021 delivery year and increasing ratably to

reach 45 million RECs delivered annually from new wind and new solar projects by the end of the

2030 delivery year.

237

Of that amount, 45% is targeted to be met through RECs from new wind projects, while 55% is

targeted to be met through RECs from new photovoltaic projects. Then, of that amount to be procured

from new photovoltaic projects, 50% is to be procured through the Adjustable Block Program, 47%

from utility-scale solar projects, and 3% has to come from brownfield site photovoltaic projects.

238

This leaves a 2021 delivery year utility-scale target of at least 2.585 million RECs delivered annually

from new utility-scale solar projects,

239

at least 141,000 RECs from new brownfield site photovoltaic

projects,

240

and at least 4.5 million RECs from new utility-scale wind projects.

241

RECs under contract

from facilities qualifying as “new” (such as those from post-P.A. 99-0906 programs and

procurements) may be used to meet this 2021 10 million REC target and the 45 million REC 2030

target, but not considered for purposes of determining whether the correct proportions of RECs have

been procured.

Section 1-75(c)(1)(G)(iii) directs the Agency to conduct “at least one subsequent forward

procurement for renewable energy credits from new utility-scale wind projects, new utility-scale

solar projects, and new brownfield site photovoltaic projects within 240 days after the effective date”

of P.A. 102-0662 in an attempt to meet this 10 million REC target. This procurement occurred in May

2022, well before this Plan was scheduled to be approved by the ICC. To meet the 10 million REC

target, the Agency developed the following annual procurement quantity targets (expressed in

annual delivery quantities) for its subsequent forward procurement.

Table 5-2: Spring 2022 Subsequent Forward Procurement Target Volumes

Utility-scale Wind

2,500,000 RECs

Utility-scale Solar

2,000,000 RECs

Brownfield Site Photovoltaic

125,000 RECs

242

The total target quantity of annual REC deliveries for this subsequent forward procurement was

4,625,000 RECs. Combined with RECs expected from the December 2021 block reopening of the

Adjustable Block Program (approximately 1 million RECs) and previously procured new utility-scale

wind and new utility-scale photovoltaic RECs and new brownfield site photovoltaic RECs (see Table

5-3), this subsequent forward procurement’s target quantities would result in Section 1-

237

20 ILCS 3855/1-75 (c) (1) (C)(i)

238

Id.

239

47% of 55% of 10 million.

240

3% of 55% of 10 million.

241

45% of 10 million.

242

Combined with the approximately 970,000 RECs expected through Adjustable Block Program reopening, REC procurement activities

authorized prior to this Plan’s approval feature target quantities for new photovoltaic REC procurement (3.095 million) versus new wind

REC procurement (2.5 million) at a ratio of 1.238:1. The IPA believes this ratio is acceptably close to the 55% to 45% proportion between

new photovoltaic project REC procurement and new wind project REC procurement found in Section 1-75(c)(1)(C) (1.222:1).

Illinois Power Agency 2022 Long-Term Plan (Final) August 23, 2022

115

75(c)(1)(C)’s 10 million REC annual delivery target being exceeded by RECs under contract prior to

any additional program and procurement activity authorized by this Plan.

Actual results from the subsequent forward procurement were significantly less than target

quantities. While actual contracted REC delivery quantities from individual projects were not

released (in an effort to protect the confidentiality of individual bid prices), the subsequent forward

procurement resulted in approximately 495 MW of new utility-scale solar, 200 MW of new utility-

scale wind, and 4.95 MW of new brownfield site photovoltaic projects.

243

While RECs procured through Section 1-75(c)(1)(G)(iii)’s subsequent forward procurement will be

included in planned quantities of RECs under contract, this Plan focuses on competitive

procurements to be conducted during the 2022 and 2023 delivery years. Additionally, as the target

procurement quantities derived through Section 1-75(c)(1)(C) of the Act are minimums and are now

accompanied by new text stating that “if forecasted expenses are less than the maximum budget

available . . . the Agency shall continue to procure new renewable energy credits until that budget is

exhausted,”

244

procurement quantities may not mirror statutory target minimums.

5.4.1 RPS Budgets

As described in Chapter 3, the Agency’s procurement of RECs is subject to budgetary limitations

determined by Section 1-75(c)(1)(E)’s rate impact cap. That cap that limits the annual average net

increase paid per kilowatthour by eligible customers, thus providing a maximum RPS budget once

multiplied by the prior year’s retail electricity sales.

In previous REC procurements, budget limits served to limit the quantity of RECs that could be

procured through competitive procurements such that actual RECs under contract fell well short of

Section 1-75(c)(1)(B)’s RPS goals. However, increased funding for REC procurements brought about

by PA 102-0662, including the increase in the rate cap from 2.015% of 2007 rates to 4.25% of 2009

rates as well as Section 16-108(k) of the PUA’s accounting provisions that allow funds to be used over

longer time periods and shield funding associated with contractual obligations from reconciliation,

have dramatically impacted the RPS budgets allowing for expanded procurements of RECs from new

utility-scale wind and new utility-scale solar projects. However, actual budget impacts resulting from

competitive procurements are now subject to increased volatility given the Indexed REC approach

now authorized under Section 1-75(c)(1)(G)(v). Nevertheless, the IPA does not believe that RPS

budgets should serve to constrain procurement quantities below statutory procurement targets for

the present planning period.

RPS budgets are discussed in further detail in Chapter 3.

5.4.2 Brownfield Site Photovoltaic Project Procurements

P.A. 102-0662 increases the goals for the procurement of RECs from photovoltaic projects located at

brownfield sites—both by increasing the minimum amount (from 2% of the solar procurement target

to 3%) and by that overall solar target increasing (now 55% of 45 million RECs by 2030).

243

Those procurement results can be found here: https://www.ipa-energyrfp.com/wordpress/wp-content/uploads/2022/05/Spring-

2022-Indexed-REC-RFP-Results-12-May-2022-posted.pdf.

244

20 ILCS 3855/1-75(c)(1)(C)(ii).

Illinois Power Agency 2022 Long-Term Plan (Final) August 23, 2022

116

Under the definition contained in Section 1-10 of the IPA Act, brownfield sites are those sites which

are regulated under the U.S. EPA’s Comprehensive Environmental Response, Compensation and

Liability Act of 1980; the Corrective Action Program of the Resource Conservation and Recovery Act;

the Illinois EPA’s Illinois Site Remediation Program; or the Illinois EPA’s Illinois Solid Waste Program;

or is the site of a former coal mine that has met all state and federal remediation and clean-up

requirements. This allowance for siting a brownfield site photovoltaic project at a former coal mine

is a new change enacted through P.A. 102-0662.

To meet these more aggressive targets under this more permissive definition, Section 1-

75(c)(1)(C)(i) of the Act now specifies that the Agency shall “consider other approaches, in addition

to competitive procurements, that can be used to procure renewable energy credits from brownfield

site photovoltaic projects and thereby help return blighted or contaminated land to productive use

while enhancing public health and the well-being of Illinois residents, including those in

environmental justice communities.” For this 2022 Plan, the Agency proposes to conduct two

brownfield site photovoltaic procurements using its traditional competitive procurement approach.

However, as that approach will reflect the changes to REC pricing and procurement processes found

elsewhere in P.A. 102-0662 (including the utilization of an Indexed REC price), the Agency will first

observe the results of procurements using this new structure and before assessing whether other

procurement approaches may be warranted. That assessment will be included in the Agency’s next

Long-Term Plan revision scheduled to be published in 2023 and approved by the ICC in 2024.

5.4.3 Labor, Diversity and Equity Requirements

New labor, diversity and equity provisions in the Act require the Agency to take measures that will

incorporate these provisions into its competitive procurement process.

Section 1-75(c)(1)(Q)(1) of the IPA Act now provides that all new utility-scale wind, utility-scale solar

and brownfield site photovoltaic projects are subject to prevailing wage requirements included in

the Prevailing Wage Act, and that RECs procured after the effective date of the Act (September 15,

2021) must be from facilities that were built under a project labor agreement.

Projects participating

in competitive procurements will be required to provide documentation that all employees,

contractors, and subcontractors engaged in construction and maintenance of the facility received at

least the local prevailing wage as set by the Illinois Department of Labor. Furthermore, as a result of

P.A. 102-0662 and clarifications made through P.A. 102-0673, all new utility-scale wind, utility scale

solar, and brownfield site photovoltaic projects participating in a competitive procurement of the IPA

are considered "public works” under the Prevailing Wage Act and are thus subject to all notice and

reporting requirements therein. Bids must include commitments to include payment of prevailing

wage in all contracts and subcontracts for construction and maintenance related to the facility. All

accepted bidders will be subject to reporting requirements throughout the life of the project as

detailed in the Prevailing Wage Act.

As outlined in Chapter 4, projects located in adjacent states satisfying public interest criteria scoring

may be eligible for the IPA’s competitive procurements. As proposed by the IPA in Docket No. 22-

0231 and affirmed by the Commission in its Order approving the Plan,

245

Section 1-75(c)(1)(Q)(1)

also carries a qualitative eligibility requirement related to fair wages paid for labor on all renewable

energy projects bidding into IPA procurements (enforced as a REC delivery contract term). Applicant

245

See Docket No. 22-0231, Final Order dated July 14, 2022 at 6-7.

Illinois Power Agency 2022 Long-Term Plan (Final) August 23, 2022

117

projects located in adjacent states must demonstrate, at minimum, wage parity with the prevailing

wage requirements in Illinois.

To achieve wage parity, if the project is located in a county in an adjacent state with published

prevailing wages, that wage schedule shall be used as the applicable prevailing wage for Section 1-

75(c)(1)(Q)(1) compliance. Should there be no governing prevailing wage schedule for that locality,

the federal Davis-Bacon rates shall be used as the applicable prevailing wage for Section 1-

75(c)(1)(Q)(1) compliance.

246

In addition, Section 1-75(c)(1)(Q)(2) also provides that for REC procurements from new utility-scale

wind, utility-scale solar, and brownfield site photovoltaic projects, such projects must be “built by

general contractors that must enter into a project labor agreement,” as defined by the Project Labor

Agreements Act, “prior to construction.” Section 1-10 of the Act defines a project labor agreement as

“a pre-hire collective bargaining agreement that covers all terms and conditions of employment on a

specific construction project.”

That project labor agreement must be filed with the Director of the IPA within 60 days prior to the

start of construction. If construction of the project has already begun at the time of a competitive

procurement then the project labor agreement must be filed with the IPA prior to submitting a bid.

Under Section 1-75(c)(1)(Q)(2), the project labor agreement must provide “the names, addresses,

and occupations of the owner of the plant and the individuals representing the labor organization

employees participating in the project labor agreement consistent with the Project Labor

Agreements Act.” Section 1-10 outlines specific additional elements required to be included in that

agreement:

(1) provisions establishing the minimum hourly wage for each class of labor organization

employee;

(2) provisions establishing the benefits and other compensation for each class of labor

organization employee;

(3) provisions establishing that no strike or disputes will be engaged in by the labor

organization employees;

(4) provisions establishing that no lockout or disputes will be engaged in by the general

contractor building the project; and

(5) provisions for minorities and women, as defined under the Business Enterprise for

Minorities, Women, and Persons with Disabilities Act, setting forth goals for apprenticeship

hours to be performed by minorities and women and setting forth goals for total hours to

be performed by underrepresented minorities and women.

As a project labor agreement is a private agreement between a project developer and a labor

organization entered into with both parties’ acquiescence, and as the IPA Act does not direct the

Agency to develop qualitative project labor agreement standards, the Agency does not believe that it

can or should generally develop minimum project labor agreement terms for that agreement to

246

For adjacent state projects, the applicant is still responsible for submitting a Certified Transcript of Payroll through the Illinois

Department of Labor Prevailing Wage portal and to the IPA for all work performed on the eligible project. The IPA is responsible for

ensuring wage parity compliance under REC delivery contract authority, with projects failing to demonstrate wage parity treated

equivalently to Illinois-based projects failing to comply with the prevailing wage requirements of the Prevailing Wage Act.

Illinois Power Agency 2022 Long-Term Plan (Final) August 23, 2022

118

satisfy Section 1-75(c)(1)(Q)(2)’s requirements. However, a labor organization and the general

contractor building the project shall have the authority to include other terms and conditions as they

deem necessary.

One possible exception regarding developing minimum project labor agreement terms concerns

“provisions for minorities and women, as defined under the Business Enterprise for Minorities,

Women, and Persons with Disabilities Act, setting forth goals for apprenticeship hours to be

performed by minorities and women and setting forth goals for total hours to be performed by

underrepresented minorities and women.”

247

As proposed by the IPA in Docket No. 22-0231 and affirmed by the Commission in approving the Plan,

project labor agreement submittals must also include a description of the efforts the entity will take

or has taken to achieve such goals, including recruitment of minorities and women into

apprenticeship roles. Setting goals is an important step toward progress, but without the ability to

review whether robust efforts are being made to recruit more minorities and women into

apprenticeships or training programs, the Agency has no insight into industry trends, challenges in

meeting those goals, or other important signals related to the Agency’s expanded role in monitoring

and improving equity in the clean energy sector.

248

Other amendments to the IPA Act through Public Act 102-0662 create obligations for the Agency to

“encourage participating projects to use a diverse and equitable workforce and a diverse set of

contractors.” Under new subparagraph (P) of Section 1-75(c)(1), the Agency must optimize the

procurement of RECs from utility-scale projects located in communities eligible to receive Energy

Transition Community Grants. To “optimize” procurement from those areas, the Agency proposes

that bids received through competitive procurements for proposed projects located in Energy

Transition Community Grant communities would receive a downward price adjustment of 10% of

the lowest bid received for use in ranking bids received, thus making those bids more competitive on

the basis of price. For example, if the bidder of a project located in an Energy Transition Community

Grant community submits a strike price of $65 and the lowest bid received is $50, then the Energy

Transition Community Grant bidder would receive a downward price adjustment in its bid of $5

(10% of $50). The price adjusted bid of $60 would be evaluated against all other bids, and if selected

the Energy Transition Community Grant bidder would receive the initial bid price of $65. This price

adjustment will provide an opportunity to “optimize” the procurement of Energy Transition

Community Grants through a competitive process.

Section 1-75(c-10)(3) directs the Agency to develop requirements for applications and include in its

bid evaluation methodology preferences for bidders that utilize a higher percentage of equity eligible

contractors. The Agency will require applications from bidders to demonstrate compliance with the

minimum equity standards under Section 1-75(c-10) (described in more detail in Chapter 10). Based

on a review of the plan submitted by a bidder, the Agency would then identify bids that demonstrate

comprehensive compliance above and beyond minimum requirements and propose a bid evaluation

price adjustment that increases as the portion of contract value flowing to equity eligible persons or

contractors increases above the minimum equity standards. This bid evaluation price adjustment

would be on a sliding scale based on the equity eligible commitment above the 10% minimum

requirement. For example, if a bidder commits to using equity eligible contractors for 50% of the

247

20 ILCS 3855/1-10.

248

See Docket No. 22-0231, Final Order dated July 14, 2022 at 7.

Illinois Power Agency 2022 Long-Term Plan (Final) August 23, 2022

119

project’s development, then the price adjustment would be based on the ratio of 50% to the 10%

minimum (or 5 times the amount of the minimum equity commitment).

The IPA is proposing a bid evaluation price adjustment for equity eligible commitments above 10%

to be 1% of the lowest bid received times that ratio of the commitment to the 10% minimum. Like

the adjustment for projects located in Energy Transition Community Grant areas, this adjustment

would only be utilized for bid evaluation, not the resulting contracted strike price. As this

commitment would impact bid selection, any project selected as a result of making an equity

commitment will have that commitment included as a binding commitment in the resulting REC

contract.

Table 5-3 demonstrates the bid evaluation price adjustments for equity eligible commitments and

Energy Transition Community Grant bids. As discussed in Chapter 10 of this Plan, entities awarded

a REC contract through a competitive procurement will also be required to submit a Compliance Plan

within 30 days of ICC approval of the bid. The Compliance Plan shall reflect the entity’s plan to meet

the minimum equity standard as laid out in their application. Chapter 10 contains additional

information on compliance plan requirements.

Table 5-3: Bid Evaluation Price Adjustments

Bids Ranked by Adjusted Bid Price

Bidder

Bid Price

Grant

Community

Grant Community

Price Adj

Equity Eligible

Commitment

Equity Eligible

Price Adj

Adjusted

Bid Price

$ 45.00

$ -

15%

$ 0.68

$ 44.33

$ 50.00

$ 4.50

20%

$ 0.90

$ 44.60

$ 60.00

$ 4.50

30%

$ 1.35

$ 54.15

$ 55.00

$ -

10%

$ -

$ 55.00

$ 58.00

$ -

40%

$ 1.80

$ 56.20

$ 70.00

$ 4.50

75%

$ 3.38

$ 62.13

Notes

- Grant Community Price Adjustment = 10% of the lowest Bid Price

- Equity Eligible Contractor Minimum Commitments is 10%

- Equity Eligible Price Adjustment = (Bidder EEC Commitment / 10% * 1%) * the lowest bid price

Illinois Power Agency 2022 Long-Term Plan (Final) August 23, 2022

120

5.4.4 Indexed REC Pricing Requirements

Perhaps the most significant change to competitive procurements resultant from P.A. 102-0662 is

the shift to an Indexed REC pricing structure. Section 1-75(c)(1)(G)(v) now requires the Agency to

procure “ Indexed RECs” for all future competitive REC procurements. Under an Indexed REC pricing

structure, the actual REC price is determined based on the strike price submitted by bidders

participating in the procurement (with that strike price used for bid selection), as outlined further

below.

249

Under Section 1-10 of the IPA Act, an Indexed REC is defined “as a tradable credit that represents the

environmental attributes of one megawatt hour of energy produced from a renewable energy

resource, the price of which shall be calculated by subtracting the Strike Price offered by a new utility-

scale wind project or a new utility-scale photovoltaic project from the Index Price in a given

settlement period.”

250

The Strike Price is defined as the “contract price for energy and RECs from a

new utility-scale wind project or a new utility-scale photovoltaic project.” The Index Price is defined

as the “real-time energy settlement price at the applicable Illinois trading hub, such as PJM-NIHUB or

MISO-IL, for a given settlement period.”

251

The settlement period will be the period of time utilized by

MISO and PJM and their successor organizations as the basis for settlement calculations in the

real-time energy market (RTM).

252

Under this model, the IPA still may evaluate competing bids on the basis of price—but on the basis

of submitted Strike Price, rather than REC price. A single Strike Price is submitted by a bidder, and

the resulting REC price for a settlement period is determined across the course of the contract as the

difference between that bidder’s Strike Price and the Index Price. As the Index Price will always be

the same for all bidders, evaluating bids from lowest to highest on the basis of Strike Price is

effectively the same evaluation as evaluating bids on the bases of REC price; the difference is simply

that because the resulting REC price floats, the exact price (and resulting RPS budget impact) varies

by settlement period.

From a bidder’s standpoint, this Indexed REC approach offers clear advantages. Given the limited

market for energy-alone off-take agreements in Illinois and the inability for the IPA to offer bundled

PPAs, an Indexed REC price structure offers bidders the revenue certainty of a bundled contract

without exposing default supply rates to potentially uneconomic hedges. From the standpoint of

developing the most possible renewable energy at the lowest possible cost, this approach offers

advantages back to the State of Illinois as well; if bidders receive full revenue certainty at the strike

price amount, then risk premiums build into bids should be minimized, allowing for the development

of more renewable energy generation at the lowest possible RPS budget impact.

As required under Section 1-75(c)(1)(G)(v)(3) of the Act, contracts must have a “minimum tenure of

20 calendar years”.

5.4.5 Indexed REC Settlement

An Indexed REC Price will be calculated for each settlement period. The REC price applicable to a

settlement period will be determined by subtracting the Strike Price from the Index Price for that

249

20 ILCS 3855/1-75(c)(1)(G)(v).

250

20 ILCS 3855/1-10 (emphasis added).

251

Id.

252

Id.

Illinois Power Agency 2022 Long-Term Plan (Final) August 23, 2022

121

settlement period. As required under Section 1-75(c)(1)(G)(v)(1), if the difference is a negative

number, the indexed REC counterparty (i.e., the public utility) shall owe the seller the absolute value

multiplied by the quantity of energy produced during that settlement period. If this difference results in

a positive number, the seller shall owe the indexed REC counterparty this amount multiplied by the

quantity of energy produced in the relevant settlement period. The Indexed REC Price formula is

illustrated below

Indexed REC Price = Index Price (RTM Settlement Price) – Strike Price (Contract Price)

Section 1-75(c)(1)(G)(v)(2) requires that “[p]arties shall cash settle every month, summing up all

settlements (both positive and negative, if applicable) for the prior month.” Based on comments the

IPA has received on the REC settlement process, the Plan proposes an hourly settlement structure

for each monthly settlement period.

The example below illustrates a monthly settlement for 2 scenarios—one in which money is owed

to the seller, and the other in which money is owed to the Indexed REC Counterparty.

Scenario 1 – Cash Settlement to Seller

Index Price = $30/MWh

Strike Price = $35/MWh

Energy Generated = 100 MWh

Indexed REC Price = 30 – 35 = -$5/MWh

Money owed to Seller = ‖-5‖ x 100 = $500

Scenario 2 – Cash Settlement to Indexed REC Counterparty

Index Price = $40MWh

Strike Price = $35/MWh

Energy Generated = 100 MWh

Indexed REC Price = 40 – 35 = $5/MWh

Money owed to Indexed REC Counterparty = 5 x 100 = $500

In Scenario 1, the difference between the Index Price and the Strike Price (i.e., the Indexed REC Price)

is negative (-$5/MWh) and so the absolute value of the Indexed REC Price is multiplied by the

quantity of energy produced in the relevant settlement period (100 MWh), and the resulting amount

($500) is paid to the seller. In Scenario 2, the Indexed REC Price is positive ($5/MWh), and the

resulting amount ($500) is paid to the Indexed REC Counterparty.

5.4.6 Forward Price Curve

To ensure funding in the annual budget for Indexed REC procurements for each year of the term of such

contracts, the Act requires that the annual cost of the contract be quantified utilizing an industry-

standard, third-party forward price curve for energy at the appropriate hub or load zone.

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The Agency will review the forward price curves that are available from third-party providers and

select the price curve source that will be used in the annual cost calculations. Each forward price

curve will contain a specific value of the forecasted market price of electricity for each annual delivery

year of the contract. For procurement planning purposes, the impact on the annual budget for the

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20 ILCS 3855/1-75(c)(1)(G)(v)(3).

Illinois Power Agency 2022 Long-Term Plan (Final) August 23, 2022

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cost of Indexed RECs for each delivery year will be determined as the expected annual contract

expenditure for that year, equaling the difference between (i) the sum across all relevant contracts

of the applicable strike price multiplied by the contract quantity and (ii) the sum across all relevant

contracts of the forward price curve for the applicable load zone for that year multiplied by the

contract quantity.

Given that the indexed price of electricity during the delivery year will not likely average to the

forecasted market price of electricity for the delivery year, this calculation is simply for budget

planning purposes only, and is not meant to establish an annual cost cap for utility REC purchases.

The Act requires that forward price curves be revised on an annual basis. Updated forward price

curves will be released and filed with the Commission in the proceeding approving the Agency's most

recent long-term renewable resources procurement plan, and the Agency’s next long-term plan filing

will utilize a forward price curve in estimating Indexed REC contract budget impacts.

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If the

expected contract spend is higher or lower than the total quantity of contracts multiplied by the

forward price curve value for that year, the forward price curve will be updated using then-currently

available price forecast data, and the RPS budget projections will be adjusted accordingly.

5.4.7 Application of the Price Curve

To manage future budget obligations resulting from competitive procurements, Section 1-

75(c)(1)(G)(v)(4) states that the Agency may consider the institution of a price collar on REC prices

paid under indexed renewable energy credit procurements establishing floor and ceiling REC prices

applicable to indexed REC contract prices. Any price collars utilized in competitive REC

procurements “shall be proposed by the Agency through its long-term renewable resources

procurement plan.”

While the Agency appreciates how a price collar may offer slightly better budget stability, after

consideration of the increase in the annual RPS funds collections combined with the changes to

Section 16-108(k) of the Public Utilities Act that allow for the use of RPS funds over a five year period,

as well as the ability to exempt from reconciliation payment obligations entered into, but not yet paid,

the Agency does not believe that a price collar is necessary for upcoming competitive procurements

as the Agency has these additional tools to manage year to year budget fluctuations.

5.5. Proposed Procurement Events

An assessment of what needs to be procured to meet these targets starts with an assessment of RECs

under contract, and specifically RECs under contract to meet utility-scale wind and solar

procurement requirements from prior procurement events.

Across competitive procurement events conducted to date, some projects have been developed,

other projects are pending final energization still, while others appear to never be successfully

developed under REC delivery contacts (and thus would not be contributing RECs to meet RPS

targets). While four utility-scale wind projects and six utility-scale solar projects have begun

delivery, other projects have not yet been energized. Five solar projects have requested energization

extensions that will take them into 2022-2023 delivery year, and four solar projects and two wind

projects have been removed from the REC portfolio.

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See Docket No. 22-0231, Final Order dated July 14, 2022 at 6.

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Table 5-3 summarizes in aggregate the status of utility-scale projects as of March 21, 2022. The

quantities listed are the aggregated contracted amounts by expected annual REC deliveries. For

planning purposes, the IPA assumes that projects for which extensions have been granted will be

successfully developed.

Table 5-4: Utility-Scale REC Portfolio Status (Annual REC Volumes)

Status

Solar

Wind

Total

Delivering RECs

1,238,936

2,065,519

3,304,455

Extensions Granted

1,266,693

Total Expected RECs

2,505,629

2,065,519

4,571,148

Removed

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548,702

879,234

1,427,936

As a consequence, additional procurement events will be required to ensure that Section 1-

75(c)(1)(C)’s new renewable energy project delivery targets are met.

Section 1-75(c)(1)(C) sets an initial REC procurement target for the 2021 delivery year of 10 million

RECs, the bulk of which will be procured from new utility-scale wind, new utility-scale solar projects,

and brownfield site photovoltaic projects in a Subsequent Forward Procurement scheduled for the

Spring of 2022, prior to the approval of this 2022 Long-Term Plan. That target grows to 45 million

RECs by 2030.

For purposes of this Plan, the Agency will assume that procurement quantities outlined for that

procurement (as listed in Table 5-2 above) will be met, but reserves the right to adjust proposed

competitive procurement quantities for future procurement events (potentially while this Plan is

pending before the ICC) based on observed results from that Subsequent Forward Procurement.

5.5.1. Utility-Scale Solar and Utility-Scale Wind

As outlined above, across 2017-2019, the Agency conducted a series of forward procurement events

intended to support the development of new utility-scale wind and utility-scale solar projects.

Through these procurement events, approximately 3 million annual deliveries of RECs each of utility-

scale wind and utility-scale solar were placed under contract. As outlined in tables above, after

project attrition, the IPA expects approximately 2.5 million utility-scale solar RECs and 2 million

utility-scale wind RECs to be delivered annually as a result of these procurement events.

While wind constitutes 45% of the “45 million by 2030” new build target found in Section 1-

75(c)(1)(C) of the RPS, utility-scale wind appears to be the only viable means for cost-effectively

developing new wind projects. As a consequence, while photovoltaics may be a larger (55%) portion

of the whole, because only 47% of that photovoltaic target is to come from utility-scale solar projects,

utility-scale solar constitutes a lower proportion of the minimum RPS quantities than utility-scale

wind.

Minimums are not maximums, however, and as the statute a) uses “at least” in referring to those

targets and b) sets up proportions within the solar percentage as proportions of a minimum amount,

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“Removed” indicates RECs that were procured in the 2017 and 2018 procurements but will not be delivered because of the projects not

meeting energization deadlines and thus have been removed from the RPS REC Portfolio.

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the IPA believes that it can exceed necessary minimums for utility-scale solar RECs if so warranted.

Should the Subsequent Forward Procurement prove successful at facilitating new utility-scale solar

development, then that will indeed be the case. Nevertheless, the Agency has outlined procurement

targets for new utility-scale wind projects that outpace those from new utility-scale solar targets

given these larger utility-scale wind targets.

5.5.2. Brownfield Site Photovoltaic

In the Initial Plan, the Agency proposed a procurement for RECs from brownfield site photovoltaic

projects with a target of 80,000 RECs delivered annually. The procurement was initially held in the

fall of 2018 in conjunction with the Photovoltaic Forward Procurement and did not successfully

procure any RECs. The Agency subsequently issued a request for comments from stakeholders to

better understand barriers to a successful procurement and filed a motion for clarification with the

ICC seeking authorization to conduct a second procurement. The Commission granted that motion

on April 26, 2019.

The Agency made certain adjustments to the procurement guidelines (notably around acceptable age

of documentation of eligibility) and conducted another procurement on July 26, 2019. On August 1,

2019, the Commission approved the results, which resulted in exceeding the at-that-time statutory

target of 40,000 RECs delivered annually by 2020-2021.

The IPA intends to use a price-based competitive approach for the procurement of brownfield site

photovoltaic RECs conducted pursuant to this Plan. While Section 1-75(c)(1)(C) requires that the

Agency “consider other approaches, in addition to competitive procurements, that can be used to

procure renewable energy credits from brownfield site photovoltaic projects,”

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proposing an

alternative approach now may be premature. The Agency expects that the use of Indexed REC pricing

and a more expansive definition of brownfield site photovoltaic projects will address the problem of

unmet targets. If these changes do not address the barriers affecting brownfield site photovoltaic

REC procurements, the Agency will determine whether an alternative procurement approach should

be implemented as part of its next Plan.

Under this 2022 Plan, the Agency proposes to conduct one brownfield site photovoltaic procurement

annually for the next two years, at quantities intended to keep pace with 2030 brownfield site

photovoltaic target.

5.5.3. Non-Photovoltaic Community Renewable Generation

In the Initial Plan, the Agency proposed a Community Renewable Generation Program Forward

Procurement (see Section 5.8.4 of the Initial Plan). This Community Renewable Generation Program

Forward Procurement was intended create an opportunity for non-photovoltaic community

generation projects to be developed. That procurement was conducted in December 2019 and did

not yield any selected bids. In Docket No. 19-0995 approving the First Revised Plan, no party sought

for an additional community renewable generation procurement to be conducted.

Since that time, Section 1-75(c)(1)(N) of the IPA Act has been revised to no longer mandate a

Community Renewable Generation Program. In its present form, subparagraph (N) now states that,

through this Plan, the Agency “may consider whether community renewable generation projects

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20 ILCS 3855/1-75 (c)(1)(C)(i)

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utilizing technologies other than photovoltaics should be supported through State-administered

incentive funding, and may issue requests for information to gauge market demand.”

The Agency appreciates the potential opportunities for additional community renewable generation

procurements to expand the range and diversity of renewable energy resources in Illinois, and notes

that changes in maximum community renewable generation project size (from 2 MW to 5 MW) may

warrant a formal Request for Information being issued between this Plan and the Agency’s next Plan

developed across the Summer of 2023.

5.5.4. Procurement of RECs from Renewable Energy Resources other than

New Wind and Solar

The Agency is not proposing any procurements of RECs from resources other than new wind and

new photovoltaic projects; this includes both other renewable energy generating technologies as well

as procurements for RECs not from specific projects or intended to result in new project development

(e.g., RECs from existing projects energized prior to June 1, 2017).

As explained in Section 2.6.2.1, Section 1-75(c)(1)(C) of the IPA Act only established targets for RECs

from new wind and furthermore that percentage-based RPS goals – be “met entirely by procurements

of renewable energy credits from new wind and photovoltaic projects.” While the Agency

appreciates that other renewable energy technologies are listed in the definition of renewable energy

resources contained in Section 1-10 of the IPA Act, these provisions of Section 1-75(c)(1)(C)—taken

in combination with the procurement priorities set forth in Section 1-75(c)(1)(F) of the Act—

preclude consideration of a procurement from technologies other than wind and solar. RECs

generated using technologies other than wind and solar can be used for other purposes, such as sales

into voluntary REC markets outside the IPA’s purview, or by Alternative Retail Electric Suppliers for

“green” or “renewable” retail electric supply offers.

5.6. Proposed Schedule for Competitive Procurements

Section 1-75(c)(1)(C) of the Act establishes a 2021 delivery year target of 10 million RECs delivered

annually from new wind and solar projects. That target increases ratably to 45 million RECs

delivered annually from new wind and new solar projects by the end of the 2030 delivery year.

The Agency understands the phrase “increasing ratably” to mean that the IPA should generally strive

to procure an equal incremental amount of RECs each year, from 2022 to 2030, until the 2030

delivery year target of 45 million RECs is met. Based on RECs under contract and those targeted to

be under contract (from the May 2022 competitive procurements and the December 2021 blocks

from the Adjustable Block Program – which would total at least 10 million RECs delivered annually

to meet the 2021 target, and the Agency will use 10 million RECs as the baseline quantity in

determining a trajectory), the Agency would need to procure contracts for 3,888,889 RECs delivered

annually each year starting in the 2022-2023 delivery year to meet that target. Of that total, 72.5%

would be required from competitive procurements, or 2,819,445 RECs delivered annually through

each year’s new REC delivery contracts (with the remaining balance from the Adjustable Block

Program). Further informed by the proportion of RECs required within each category under Section

1-75(c)(1)(C), this results in annual (rounded) procurement quantities of 1,750,000 utility-scale

wind RECs, 1,000,000 utility-scale solar RECs, and 65,000 brownfield site photovoltaic RECs for each

year’s competitive procurement events.

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Section 1-75(c)(1)(C)(ii) also requires that the if “if forecasted expenses are less than the maximum

budget available under subparagraph (E) of this paragraph (1), the Agency shall continue to procure

new renewable energy credits until that budget is exhausted.” In the case of competitive

procurements for RECs from new utility-scale projects, however, “continuing to procure” is a more

fraught alternative: contract obligations are paid upon delivery, meaning that procurement

quantities now carry budget obligations 20+ years into the future and preclude additional program

and procurement activity from being conducted. Further, making too cavalier of an increase in

competitive procurement event quantities may reduce the competitiveness of individual

procurement events, thus risking a negative impact on resulting prices (and resulting budget

impacts). Lastly, as the IPA has yet to observe results from the new Indexed REC price structure and

how possible volatility from that structure risks future years’ budgets, it has elected to pursue more

conservative procurement quantities.

Therefore, in addition to the Subsequent Forward Procurement to be held in the Spring of 2022, the

Agency is proposing to conduct the following competitive procurements during the 2022 and 2023

calendar years at quantities developed to meet Section 1-75(c)(1)(C)’s statutory delivery year REC

targets. Targets may be adjusted upward based on results observed through the Subsequent

Forward Procurement Event; as that procurement’s results will be known before the Commission’s

approval of this Plan, the IPA may propose those changes during the proceeding before the

Commission seeking approval of this Plan.

Table 5-5: Proposed Procurements

Procurement

Technology

Procurement

Date

Annual REC

Target

Wind Forward Procurement

Wind (utility-scale)

Fall 2022

1,750,000

Solar Forward Procurement

Solar (utility-scale)

Fall 2022

1,000,000

Brownfield Site Photovoltaic

Photovoltaic (brownfield)

Fall 2022

65,000

Wind Forward Procurement

Wind (utility-scale)

Summer 2023

1,750,000

Solar Forward Procurement

Solar (utility-scale)

Summer 2023

1,000,000

Brownfield Site Photovoltaic

Photovoltaic (brownfield)

Summer 2023

65,000

With this 2022 Long-Term Plan being approved in July 2022, the Agency expects to conduct the 2022

procurements late in the calendar year to allow for time to implement any changes to the

procurement requirements resulting from the approval of this plan. For 2023, the Agency proposes

to hold the procurement in late spring or early summer—and if procurement volumes are not filled,

the IPA would consider holding a subsequent procurement in late 2023. The Agency may request

stakeholder feedback after a procurement event that does not meet it REC target to consider changes

to the procurement requirements that could be made outside of updating this Long-Term Plan.

5.6.1. Proposed Schedule for Competitive Procurements

This 2022 Long-Term Plan covers the Agency’s potential proposed procurements conducted during

delivery years 2022 and 2023. Procurements to be conducted after the 2023 delivery year will be

considered in the next revised Plan. A draft of that Plan is scheduled for release by mid-August 2023.

Illinois Power Agency 2022 Long-Term Plan (Final) August 23, 2022

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5.7. Contracts

For the Initial Forward Procurements and additional competitive procurements conducted pursuant

to the Initial Plan, the Agency updated its REC contract used in previous competitive procurements

for renewable energy credits. This update made changes to ensure that the contract was compliant

with new requirements found in P.A. 99-0906, but otherwise followed the standard format of a Cover

Sheet, Revisions to the Master REC Agreement, and the Master REC Agreement itself.

Through the First Revised Plan, the Agency proposed significant revisions to the REC delivery

contract structure utilized in competitive procurement events, including integrating what had been

three separate sections of the contract into a single, more streamlined contract instrument. This

revised contract was utilized in the March 2021 Subsequent Forward Procurement, and a version of

it (otherwise updated for consistency with changes in law found in P.A. 102-0662) has also been

utilized for the Subsequent Forward Procurement required under Section 1-75(c)(1)(G)(iii).

5.7.1. Credit Requirements

To ensure that RECs under contract to satisfy a compliance requirement are indeed delivered, the

Agency proposes to continue requiring collateral with contracts, with the collateral amount

established as a function of contract value. While specific collateral levels are not proposed as part

of this 2022 Long-Term Plan (and have traditionally been determined through the contract

development process), the Agency believes that the level of collateral must be low enough to

encourage participation (especially from small businesses and other newer market entrants) and

high enough to discourage suppliers from voluntarily defaulting on contracts for economic reasons.

As an initial step, to ensure that entities who participate in procurement events are committed to

following through on contract performance, the IPA proposes a strict requirement for any

procurements held pursuant to this 2022 Long-Term Plan that suppliers and associated facilities who

voluntarily default on contracts for economic reasons (such as choosing to sell the RECs elsewhere

after making the commitment to sell them to an Illinois utility) or misrepresent their eligibility to

participate in a procurement event will risk being ineligible for participation in future RPS

procurements. For voluntary economic default, an initial two-year suspension term will be

considered to be a generally reasonable penalty, and the IPA has discretion to consider a harsher

penalty for a second default for economic reasons or if it finds a party knowingly made

misrepresentations or acted in bad faith.

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Thus, in determining whether precluding future participation is warranted, the Agency will review

all available facts and evidence and consider whether the supplier or applicant made a good faith

effort at compliance and whether non-compliance resulted from circumstances outside of that

party’s control. The Agency will monitor and review this requirement and will consider refinements

or updates to it in future Plan revisions if necessary.

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See Docket No. 22-0231, Final Order dated July 14, 2022 at 7-10. In discussing “suppliers and associated facilities who voluntarily

default on contracts for economic reasons,” the Agency is specifically referencing voluntary default on an Indexed REC contract because

the developer elects to sell its RECs to another buyer under circumstances within that developer’s control—in particular, because of a

more attractive REC price or contract structure offered by a different buyer. Should default occur because of circumstances outside of that

entity’s control—including the RPS budget being exceeded in a delivery year, unanticipated significant interconnection costs making

development uneconomic, or other unforeseeable costs or circumstances sufficient to significantly alter project economics—then

suspension would not be warranted.

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Any forfeiture of collateral by a project under a competitively procured REC contract with a utility

will be considered to be returned to the Renewable Resources Budget.

5.8. Benchmarks

Prior to the revisions to the RPS contained in Public Act 99-0906, benchmarks used for renewable

energy resources procurements (i.e., confidential price levels above which no bids would be

accepted) were developed pursuant to a statutory provision requiring that the price paid for

renewable energy resources being procured “not exceed benchmarks based on market prices for

renewable energy resources in the region,” and required that such benchmarks “be developed by the

procurement administrator, in consultation with the Commission staff, Agency staff, and the

procurement monitor” and “subject to Commission review and approval.”

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As now modified through changes found in P.A. 102-0662, “cost-effective” means that the prices for

RECs

do not exceed benchmarks based on market prices for like products in the region. For

purposes of this subsection (c), "like products" means contracts for renewable energy

credits from the same or substantially similar technology, same or substantially similar

vintage (new or existing), the same or substantially similar quantity, and the same or

substantially similar contract length and structure. Benchmarks shall reflect

development, financing, or related costs resulting from requirements imposed through

other provisions of State law, including, but not limited to, requirements in

subparagraphs (P) and (Q) of this paragraph (1) and the Renewable Energy Facilities

Agricultural Impact Mitigation Act. Confidential benchmarks shall be developed by the

procurement administrator, in consultation with the Commission staff, Agency staff, and

the procurement monitor and shall be subject to Commission review and approval. If

price benchmarks for like products in the region are not available, the procurement

administrator shall establish price benchmarks based on publicly available data on

regional technology costs and expected current and future regional energy prices.

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Changes through P.A. 102-0662 serve to clarify that a) benchmarks are “confidential” (which is

separately required under Section 16-111.5 of the PUA) and b) benchmarks developed shall reflect

any costs imposed by “other provisions of State law” (which the Procurement Administrator would

generally otherwise seek to do).

Due to the sensitive nature of the benchmark development process and how the release of

information related to the level of the benchmark could impact bidder behavior in competitive

procurements, additional information will not be provided regarding the process for developing the

benchmark or any range of potential benchmark prices.

By law, these benchmarks are not to be used to curtail or otherwise reduce contractual obligations

entered into by or through the Agency prior to June 1, 2017.

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258

20 ILCS 3855/1-75(c)(1) repealed effective June 1, 2017.

259

20 ILCS 3855/1-75(c)(1)(D).

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Id.

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6. Self-Direct Renewable Portfolio Standard Compliance Program

6.1. Introduction

Public Act 102-0662 also introduced new Section 1-75(c)(1)(R) of the IPA Act into Illinois law; this

new subparagraph requires that the Illinois Power Agency “establish a self-direct renewable

portfolio standard compliance program for eligible self-direct customers that purchase renewable

energy credits from utility-scale wind and solar projects through long-term agreements.” By law, and

as described more extensively below, qualifying customers must meet certain size thresholds, while

qualifying projects must be “new” projects sited in locations otherwise eligible for RPS compliance.

This Chapter provides the IPA’s discussion of this new self-direct program, including how to address

items left by statute to be settled through this Long-Term Plan.

6.1.1. Self-Direct Program Overview – What is a Self-Direct Program?

Since enactment of the Future Energy Jobs Act (P.A. 99-0906), RPS compliance in Illinois has been

managed by the Illinois Power Agency through its administration of programs and procurements.

Requirements applicable to those programs and procurements are outlined in Illinois law, with

further refinements, requirements, and operationalized approaches for how to meet RPS goals and

targets set forth through the IPA’s biannually-developed Long-Term Renewable Resources

Procurement Plan. Deliveries of renewable energy credits (“RECs”) are brought under contract

through the IPA’s programs and procurements, with Illinois electric utilities serving as the Buyers

and recipients of RECs produced by participating renewable energy projects. Funding to support the

purchase of RECs is provided by Illinois electric utility ratepayers through volumetric, non-

bypassable electric bill charges, with that funding providing needed revenue (and revenue certainty)

back to developers of these of new renewable energy projects.

As a restructured state, electric utilities do not and cannot own these renewable energy projects

(subject to limited exceptions), and do not supply electricity to support most retail customer load—

most retail customer electric supply needs are instead met through competitive suppliers. Instead,

those utilities receive and retire RECs associated with energy that, in many cases, is sold separately

from the transfer of RECs, with the retirement of those RECs allowing for the state to measure its

progress against percentage-based RPS goals (e.g., “25% by 2025,” meaning that 25% of retail sales

are to be met by REC retirements by 2025) or quantity-based targets (e.g., 2,000,000 RECs from new

wind projects delivered annually by 2020). Progress toward meeting RPS goals has thus been

measured exclusively through projects participating in IPA programs and procurements, featuring

RECs purchased by, delivered to, and retired by Illinois electric utilities.

In general terms, an RPS self-direct program operates in contrast to the IPA-administered RPS

activities in the following ways:

1. Under a self-direct program, RECs are received and retired by individual customers through

its own purchases, rather than by the electric utility itself, thus allowing for that customer to

retire those RECs and itself make environmental claims regarding the use of renewable

energy.

2. As that customer is meeting RPS requirements through its own REC purchases, its electricity

usage is no longer included in the denominator used to track the state’s broader RPS

compliance.

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3. As that customer is engaged in its own REC procurement activities to support renewable

energy procurement progress, it is credited back for or excused from some portion of non-

bypassable RPS charges levied to support RPS activities.

As this RPS compliance occurs through private bilateral transactions entered into at the election of

those private parties, rather than through a centralized planning process or by regulatory fiat, that

RPS compliance pathway is viewed as “self-compliance” or “self-direct.”

6.1.2. Prior RPS Self-Direct Programs in Illinois

Prior to the enactment of Public Act 99-0906, the Illinois RPS was met through centralized IPA

planning only for those customers taking electric supply from Illinois electric utilities. For those

customers taking supply from an alternative retail electric supplier, Section 16-115D of the PUA

provided a different path for compliance. Each ARES—and not each individual customer—was

required to satisfy a renewable portfolio standard requirement as a percentage of its electricity sales,

but could satisfy its obligation by making alternative compliance payments at a rate reflecting that

rate paid by default supply customers for no less than 50% of its RPS obligation. For the remaining

50% of its obligation, the ARES could either pay additional alternative compliance payments and/or

self-procure RECs. Qualifying RECs needed to be sourced from facilities within the regional

transmission territories of PJM Interconnection, L.L.C. (“PJM”) and Midcontinent Independent System

Operator, Inc. (“MISO”), a relatively broad geographic footprint, and from any qualifying renewable

energy technology.

With ARES competing with one another for customers (and, for residential and small commercial

customers, also competing against default supply service), this paradigm created an incentive for an

ARES to comply at the lowest cost possible. Thus, alternative compliance payments (“ACPs”) were

generally made for the minimum 50% amount (as the rate applicable to those ACPs reflected more

expensive procurements made by the Agency to support new project development, such as through

the 2010 Long-Term Power Purchase Agreements used to support new wind and solar projects), and

the self-procurement obligation was not structured to lead to the development of new renewable

energy generation. If RECs were available for purchase from facilities already built and financed, or

from projects located in vertically-integrated states with development costs already covered by that

state’s ratepayers, then those RECs could be utilized for compliance.

This short-term, transactional incentive structure for ARES self-directed RPS compliance meant that

very little new renewable generation was able to be developed through this compliance mechanism.

Even though ARES were procuring millions of RECs in aggregate each year, the incentive structure

facing those suppliers made it highly unlikely that those RECs would be sourced from anything other

than the lowest-priced seller: these were generally facilities that had already been built and financed

without reliance on this revenue stream, and potentially from projects in vertically integrated states

with costs already being fully recovered through rates. By contrast, supporting new development

required long-term revenue certainty at REC prices likely higher than what already-constructed

facilities could offer. Furthermore, the RPS budget volatility introduced by customer load switching

to and from ARES supply service presented significant planning challenges, with long-term contracts

needed to provide revenue certainty to new projects disfavored given the year-over-year uncertainty

about the presence of funding supporting those obligations.

Public Act 99-0906 introduced a two-year sunset to this alternative ARES compliance mechanism,

and by mid-2019, the entirety of RPS compliance (whether for default supply customers, ARES

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customers, or hourly pricing customers) had transitioned to a centralized planning and procurement

structured administered by the IPA.

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Through new Section 1-75(c)(1)(R), Illinois law now allows

for a return to a self-direct structure—but with significant guardrails regarding the customer,

qualifying facility, REC delivery contract, and self-direct benefit intended to ensure that participation

in this self-direct program supports the spirit informing the Illinois RPS (namely, to support new

renewable energy projects sited in areas that bring benefits back to Illinois residents and businesses).

As the IPA believes that the challenges outlined above inform many of the requirements found in

Section 1-75(c)(1)(R), this background is vital for understanding why self-direct RPS compliance in

Illinois has taken this particular form.

6.2. Self-Direct Customer Eligibility

One such area where limitations on self-direct participation can be found is in which customers may

qualify. By law, only “eligible self-direct customers” may qualify, and Section 1-75(c)(1)(R)(1)

provides the following definition to support that requirement:

"Eligible self-direct customer" means any retail customers of an electric utility that serves

3,000,000 or more retail customers in the State and whose total highest 30-minute demand was

more than 10,000 kilowatts, or any retail customers of an electric utility that serves less than

3,000,000 retail customers but more than 500,000 retail customers in the State and whose total

highest 15-minute demand was more than 10,000 kilowatts.

This definition offers a few key limitations: first, the customer must be a retail customer of either

Commonwealth Edison company or Ameren Illinois. Customers of municipal electric utilities, rural

electric co-operatives, or other electric utilities (such as MidAmerican Energy Company) are

ineligible. Second, the customer must be of at least a threshold size: 10,000 kilowatts of peak

demand, which the IPA believes should be interpreted as non-coincident peak demand and evaluated

based on customer billing information. Meeting this threshold may be established by monthly utility

bills or utility historical consumption reports, so long as that proof is derived from the 12 consecutive

billing periods prior to the start of the year in which the application is filed. Thus, the Illinois RPS

self-direct compliance program is a large customer self-direct program for only customers of the

largest Illinois electric utilities.

Additional requirements apply to both the renewable energy facilities with which these customers

contract for RECs, as well as the REC delivery contracts executed by those customers, as discussed

further in this Chapter.

6.2.1. Common Parents

Section 1-75(c)(1)(R)(1) also provides a definition of “retail customer” that allows for account

aggregation in the case of common corporate parents:

"Retail customer" has the meaning set forth in Section 16-102 of the Public Utilities Act

and multiple retail customer accounts under the same corporate parent may aggregate

their account demands to meet the 10,000 kilowatt threshold. The criteria for

determining whether this subparagraph is applicable to a retail customer shall be based

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One limited exception is Section 1‐75(c)(1)(H)(i) of the IPA Act, which allows an ARES self-supply a finite quantity of RECs from

qualifying renewable energy generating facilities owned by that ARES in exchange for a bill credit for its customers. See Section 3.6 for

more information.

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on the 12 consecutive billing periods prior to the start of the year in which the

application is filed.

Thus, in the case of common corporate parents, multiple individual accounts from affiliated

companies (such as individual retail branch locations from the same company) may be aggregated

for purposes of meeting this size threshold, and by extension for purposes of establishing those

customer accounts which may benefit from the self-direct program through a reduced RPS charge.

For an individual retail account to be eligible to be aggregated under a corporate parent’s application,

the IPA will require that an individual retail account entity be a fully owned, integrated operation of

the corporate parent or a subsidiary in which the corporate parent holds a controlling interest of

more than 50 percent.

For its filed Plan, the IPA had originally proposed that because bill crediting operates specific to each

individual electric utility, the aggregated demand must be for individual accounts within one of the

utilities’ service territories (with bill crediting then awarded by that utility specific to those qualifying

customers of that utility)—and would not allow for aggregating individual accounts located across

more than one utility service territory to meet the 10,000 kW threshold. However, in ICC Docket No.

22-0231 approving the Plan, the Commission instead concluded that the Plan “should be modified to

reflect the ability of customers under the same corporate parent to aggregate their account demands

to meet the 10,000 kW threshold and that customers must qualify their accounts according to the

statutory definition of ‘Eligible self-direct customer’ for each of the utilities in which the customer

has accounts that it seeks to aggregate to meet the 10,000 kW threshold.”

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While not crystal clear,

the IPA understands the Commission’s Order adopts a proposal made by the NRG Companies and

supported by other parties allowing for aggregation across utility service territories for affiliated

customers seeking to meet the 10,000 kW demand threshold. The Order additionally clarifies that

“customer accounts may only receive the Self-Direct Program credit that is specific to the utility that

serves that account.”

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An example of how the aggregation of demand would be applied: Corporate Parent owns two

manufacturing facilities—Facility A, which is in the ComEd service territory, and Facility B, which is

in Ameren’s service territory. Facility A’s peak 30-minute demand of 7,000 kW can be combined with

Facility B’s peak 15-minute demand of 4,000 kW to exceed the 10,000 kW threshold for self-direct

program qualification. Facility A will receive the self-direct credit for ComEd customers, and Facility

B will receive the self-direct credit for Ameren customers.

During stakeholder comments, one question that arose was whether multiple affiliated government

accounts could be aggregated to meet this retail customer threshold. The IPA believes that, for

example, the individual government buildings for a given municipality should be understood as

featuring the same “corporate parent,” but less obvious cases may require judgment once

applications are reviewed. A certified resolution or affidavit from an appropriate municipal official

that identifies the accounts that are controlled by the municipality is acceptable proof of eligibility

for the 10,000 kilowatt threshold. However, individual customer accounts assembled under an

aggregation contract (such as with opt-out municipal aggregation as contemplated under Section 1-

92 of the IPA Act) cannot qualify, unless those customers could separately establish a common

corporate parent. Neither can individual municipal accounts across municipalities joined together

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Docket No. 22-0231, Final Order dated July 14, 2022 at 14.

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Id.

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by an Intergovernmental Cooperation Agreement, as the character of an intergovernmental

agreement between multiple and separate municipalities more closely resembles a contractual

relationship than a common corporate parent.

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The IPA also understands that although eligibility for the self-direct program is expressly required to

be based on the prior 12 billing periods, a customer could qualify for the self-direct program through

monthly billing demonstrating that this 10,000 kilowatt threshold is met. However, a customer

lacking eligible billing history (such as a new customer or customers) could not qualify for the self-

direct program until qualifying billing history has been established.

6.3. Project Eligibility

To qualify, an eligible self-direct customer must hold a long-term contract for the delivery of RECs

from an eligible renewable energy generating facility. Section 1-75(c)(1)(R) also provides

requirements applicable to those projects. As a threshold matter, only utility-scale (above 5 MW)

wind or photovoltaic projects may qualify.

6.3.1. “New” Projects

Under Section 1-75(c)(1)(R)(2)(vi) of the Act, RECs must be sourced “from new utility-scale wind

projects or new utility-scale solar projects.” Unlike Section 1-75(c)(1)(C)(iii), which expressly

provides that “new” projects are those energized after June 1, 2017, Section 1-75(c)(1)(R) provides

no definition of a “new” project. However, because the definition of a new project found in Section

1-75(c)(1)(C)(iii) is stated as broadly applying “[f]or purposes of this Section,” the IPA believes that

energization after June 1, 2017 is the applicable threshold for whether a project may be considered

“new” for self-direct RPS compliance purposes.

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6.3.2. Locational Requirements

Section 1-75(c)(1)(R)(2)(ii) provides that RECs must be sourced from a facility compliant with “the

geographic requirements as set forth in subparagraph (I) of paragraph (1) of subsection (c) as

interpreted through the Agency's long-term renewable resources procurement plan, or, where

applicable, the geographic requirements that governed utility-scale renewable energy credits at the

time the eligible self-direct customer entered into the applicable renewable energy credit purchase

agreement.” This first half of this requirement is relatively straightforward; in Chapter 4, the IPA

describes its approach to qualifying renewable energy projects located in adjacent states under

Section 1-75(c)(1)(I) of the IPA Act. Those facilities must meet a threshold score based on project

application, and the Agency has a predetermination process for entities seeking to understand

whether certain facilities qualify. The public interest criteria that the Agency takes into consideration

for this scoring are as follows:

1. Minimizing sulfur dioxide, nitrogen oxides, particulate matter and other pollution that

adversely affects public health in Illinois;

2. Increasing fuel and resource diversity in Illinois;

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This conclusion was reaffirmed by the Commission in Docket No. 22-0231, in which the Commission stated that “[m]unicipalities that

have entered into an intergovernmental agreement are not ‘under the same single corporate parent’ as required by the IPA Act.” Docket

No. 22-0231, Final Order dated July 14, 2022 at 15.

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To support equivalent treatment between projects, the IPA does not understand “new” projects to include repowered projects, such as

an existing wind farm featuring replaced turbines; otherwise, facilities may seek to repower well before the useful life of renewable energy

generation equipment has expired in seeking a more lucrative REC delivery contract.

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3. Enhancing the reliability and resiliency of the electricity distribution system in Illinois;

4. Meeting goals to limit carbon dioxide emissions under federal or state law; and

5. Contributing to a cleaner and healthier environment for the citizens of Illinois.

To assess whether a renewable generating facility located in an adjacent state that provides RECs to

the self-direct customer so that the self-direct customer is eligible to participate in the program, the

Agency assigns a maximum of 20 points to each of the five public interest criteria for a total of 100

possible points. For a renewable energy generating facility in an adjacent state to be able to supply

RECs to a self-direct customer that would qualify to participate in the program, the adjacent state

facility needs to demonstrate that it can achieve a total score of at least 60 points. As this criteria and

scoring has remained unchanged across the IPA’s Long-Term Renewable Resources Procurement

Plans published in 2017, 2019, 2021, and now in 2022, the process for determining locational facility

eligibility for projects falling under Section 1-75(c)(1)(I)’s requirements should by now be known

and straightforward.

Less clear is the specific point in time at which this Section 1-75(c)(1)(I) criteria applied versus a

preceding location construct. While the scoring methodology and threshold score under Section 1-

75(c)(1)(I)’s public criteria were not finalized until the April 3, 2018 ICC approval of the IPA’s Long-

Term Renewable Resources Procurement Plan, Section 1-75(c)(1)(G) of the Act required the Agency

to conduct “initial forward procurements” for RECs delivered from new utility-scale wind and solar

projects in advance of that criteria’s finalization (including as early as the Fall of 2017). In outlining

requirements applicable to projects participating in those initial forward procurements, the Agency

determined the Section 1-75(c)(1)(I)’s requirements still-to-be-determined through the Long-Term

Plan approval process must nevertheless apply, and thus that any participating adjacent state

projects risked being excluded after receiving a contract award pending final determination of

adjacent state criteria. Thus, because the Agency previously applied these criteria to REC delivery

contracts executed between June 1, 2017 (the effective date of P.A. 99-0906) and April 3, 2018 (the

ICC’s approval of the IPA’s initial Long-Term Plan, and thus the point in time at which Section 1-

75(c)(1)(I)’s locational criteria was finalized), June 1, 2017 constitutes the date at which Section 1-

75(c)(1)(I)’s locational criteria became effective for Section 1-75(c)(1)(R) purposes.

While no qualifying facility can have an energization date pre-dating June 1, 2017, it is possible that

some REC supply contracts were nevertheless executed before June 1, 2017 for projects still under

development. In this case, the precursor to Section 1-75(c)(1)(I) was the “Illinois and adjacent state”

preference then found in Section 1-75(c)(1) of the IPA Act—through which, under competitive

procurements, RECs from Illinois and adjacent states were given selection priority, with

consideration of RECs from elsewhere only provided if procurement quantities could not be met

through Illinois and adjacent state projects. The IPA thus understands that should a qualifying REC

supply contract have been entered into before June 1, 2017, that facility may be located anywhere

within Illinois or an adjacent state, but not outside of that footprint.

6.3.3. Labor and DEI Requirements

Section 1-75(c)(1)(R)(2)(vii) requires that, for self-direct REC delivery contracts entered into after

the September 15, 2021 effective date of Public Act 102-0662, “the new utility-scale wind projects or

new utility-scale solar projects must comply with the requirements established in subparagraphs (P)

and (Q) of paragraph (1) of this subsection (c) and subsection (c-10).”

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With respect to project labor requirements found in subparagraph (Q), projects will be required to

comply with both the Prevailing Wage Act and to enter into a project labor agreement, as required

for utility-scale wind and solar projects under Section 1-75(c)(1)(Q)(2) of the Act. For Prevailing

Wage Act compliance, customers will be required to submit certified transcripts of payroll applicable

to those facilities in a manner mirroring requirements applicable to projects under development

under the Adjustable Block Program, as outlined in Chapter 7. For project labor agreements, the

timing for the receipt of such agreements, and the content required within such agreements, will

mirror requirements applicable to utility-scale projects participating in IPA procurements as

outlined in Chapter 5; whether such agreements qualify will be based on both the body of the PLA

and any addenda thereto. Additional details on processes for submittal will be made available as the

IPA develops self-direct RPS program application forms and processes.

With respect to the diversity, equity, and inclusion requirements found in subsection (c-10), projects

must comply with the minimum equity standard and the associated planning and reporting

requirements detailed in Chapter 10. The self-direct customer shall submit a Minimum Equity

Standard Compliance Plan with its application to the program and report on compliance as part of its

annual report required pursuant to Section 1-75(c)(1)(R)(3) and discussed further in Section 6.9

below. The minimum equity standard that is in place at the time of approval of the customer’s

participation in the self-direct program will be the percentage standard applicable to the

construction of the new utility-scale wind or solar project from which that customer receives and

retires RECs.

Additional information on compliance with minimum equity standards will be made available after

the conclusion of this proceeding, after minimum equity standards applicable to utility-scale projects

participating directly in IPA-administered competitive procurements have been finalized and

approved by the Commission. The Agency plans to hold a stakeholder comment process on how best

to mesh self-direct program participation (which takes place through large retail customers) with

equity standards compliance (which generally concerns project development).

With respect to the requirements of subparagraph (P), priority in selection will be given to

applications featuring projects located in Energy Transition Community Grant communities should

the program receive qualified applications exceeding program size. That approach is outlined in

Section 6.6.3 below.

6.4. REC Delivery Contract Eligibility

Even with a qualifying customer and qualifying project, certain Section 1-75(c)(1)(R) requirements

also apply to the legal instrument through which that customer receives RECs from that “new,”

locationally-appropriate utility-scale wind or utility-scale solar facility. Notably, that instrument

need not be exclusively for RECs; bundled agreements (including, e.g., delivery of energy) may also

qualify, so long as REC delivery requirements are met through those instruments. By extension,

delivery to the customer may also occur through an instrument executed with an intermediary, such

as an alternative retail electric supplier; however, any instruments executed with an intermediary

(i.e., not with the qualifying facility itself) must be structured to ensure that sufficient quantities of

RECs will be delivered from qualifying facilities across the minimum contract term—and cannot be

open-ended as to the specific source of RECs.

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6.4.1. Contract Term

Mirroring the long-term REC delivery contracts provided for elsewhere throughout Section 1-

75(c)(1) of the IPA Act, Section 1-75(c)(1)(R)(2)(iii) requires that RECs “be procured through long-

term contracts with term lengths of at least 10 years” from qualifying facilities. The IPA understands

that this requirement is intended to help ensure that qualifying facilities may not have been built but

for the REC delivery contract that provided long-term revenue certainty back to that facility, and thus

that the Illinois RPS self-direct program provides benefits to credit new renewable energy project

development.

Section 1-75(c)(1)(R)’s requirements do not apparently require 10 years of REC deliveries from the

date of application into the program; instead, only that the contract term itself is at least 10 years in

length. Consequently, the IPA understands that a customer could already be receiving RECs under a

qualifying REC delivery contract at the time of application to the program in 2023 with less than 10

years of deliveries remaining, and benefit from self-direct participation for the remaining years of

that contract. However, the IPA believes that should any aspect of that contract have been non-

compliant with self-direct program requirements, then 10 years of deliveries under compliant terms

is required to meet this contract length threshold.

As discussed further in this Chapter, to demonstrate compliance with these and other requirements,

applicant customers will generally need to provide the legal instrument through which RECs are

required to be delivered as supporting evidence.

6.4.2. Delivery Quantity Requirement

Section 1-75(c)(1)(R)(2)(iv) requires that RECs delivered to an eligible self-direct customer from a

qualifying facility or facilities “be equivalent in volume to at least 40% of the eligible self-direct

customer's usage, determined annually by the eligible self-direct customer's usage during the

previous delivery year, measured to the nearest megawatt-hour.” Thus, if a customer used 10,000

megawatt-hours in the previous delivery year, then the contracted delivery quantity must be at least

4,000 RECs. A customer can receive and retire additional RECs from that same facility, although no

additional credit is provided beyond the applicable published self-direct credit amount,

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with that

published self-direct credit amount then applying to the entirety of that customer’s load. Thus, the

self-direct credit operates in a binary manner—if a customer qualifies, then the entirety of the

customer’s volumetric RPS charges are credited accordingly, with that customer’s load no longer

included in the denominator used for determining how many RECs must be procured by the IPA to

meet Section 1-75(c)(1)’s RPS goals. However, if a customer fails to meet this 40% threshold, then

no credit is provided, and the customer simply fails to qualify for the self-direct program.

This raises the question of whether that 40% threshold is determined annually for compliance as

customer usage changes, or a one-time threshold determination for that customer’s eligibility. In

light of Section 1-75(c)(1)(R)(5)’s instruction that “[o]nce the Agency determines that a self-direct

customer is eligible for participation in the program, the self-direct customer will remain eligible

until the end of the term of the contract,” and given the administrative burden of annually comparing

customer usage to REC deliveries (and then possibly distinguishing between good faith non-

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This conclusion was reinforced by the Illinois Commerce Commission’s Final Order in Docket No. 22-0231. That Order clarified that

“[t]he 40% threshold in the statute is an eligibility criteria, nothing in the statute suggests that the credit should be scaled based on the

level of RECs purchased” and thus declined to adopt a proposal under which REC procurements above that 40% threshold would have

resulted in an increased self-direct credit back to the customer. Docket No. 22-0231, Final Order dated July 14, 2022 at 39.

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compliance versus gaming), the IPA believes that an initial determination that the legal instrument

is structured to meet 40% of the customer’s usage through REC deliveries will be generally sufficient.

However, the Agency reserves the right to make inquiries of customers should it have reason to

believe that this threshold is consistently being missed and may take action under Section 1-

75(c)(1)(R)(6) of the Act should that customer fail to provide documentation demonstrating ongoing

compliance (including through required annual compliance reporting, as discussed in Section 6.9

below). Similarly, the Agency believes that eligibility should be based upon meeting the 10,000

kilowatt threshold at the time of application approval. Should the customer’s demand subsequently

decline below the 10,000 kilowatt threshold, that demand decline would not invalidate an approved

customer’s established eligibility.

6.5. Self-Direct Crediting and Accounting

As customers may already engage in any of the qualifying REC delivery contracting contemplated in

Section 1-75(c)(1)(R), the benefit of self-direct RPS program participation for an eligible self-direct

customer is simply a reduction in the non-bypassable charges levied by Illinois electric utilities to

support RPS activities (or a “credit” against those charges). The methodology for determining bill

credits for participating customers is outlined in Section 1-75(c)(1)(R)(4) of the IPA Act, and the IPA

explains its understanding of that bill crediting methodology further below.

Meanwhile, the benefit to the State of Illinois in providing the self-direct program is a reduction in

the quantity of RECs required to be procured through IPA-administered utility-scale procurements,

as “[e]ach renewable energy credit procured . . . by a self-direct customer shall reduce the total

volume of renewable energy credits the Agency is otherwise required to procure from new utility-

scale projects.” Thus, while the self-direct program does result in a reduction of available RPS

budgets, it also allows the Illinois RPS to recognize private sector renewable energy support through

a reduction in required REC procurement quantities. Further, the requirement that contracts be at

least 10 years in length reduces the year-to-year budget volatility resultant from other possible self-

direct regimes.

6.5.1. Self-Direct Bill Crediting

Section 1-75(c)(1)(R)(4) authorizes a “reduction in the volumetric charges collected pursuant to

Section 16-108 of the Public Utilities Act for approved eligible self-direct customers” as those

customers’ benefit for self-direct program participation. As this program operates as an self-direct

RPS compliance program only, the IPA understands “volumetric charges collected pursuant to

Section 16-108” to refer only to those charges utilized to support RPS program and procurement

activities pursuant to Section 16-108(k) of the PUA, and not charges used to support the procurement

of zero emission credits, carbon mitigation credits, Coal to Solar and Energy Storage Initiative

Charges, or other collections and initiatives referenced in Section 16-108(k).

That reduction, or “credit,” is calculated to be “equivalent to the anticipated cost of renewable energy

credit deliveries under contracts for new utility-scale wind and new utility-scale solar entered for

each delivery year after the large energy customer begins retiring eligible new utility scale renewable

energy credits for self-compliance.” Section 1-75(c)(1)(R)(4) further clarifies that the self-direct

credit amount shall be “equal to the estimated portion of the cost authorized by subparagraph (E) of

paragraph (1) of this subsection (c) that supported the annual procurement of utility-scale renewable

energy credits in the prior delivery year using a methodology described in the long-term renewable

resources procurement plan, expressed on a per kilowatthour basis.” By law, the credit back to the

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customer cannot include “costs associated with any contracts entered into before the delivery year

in which the customer files the initial compliance report to be eligible for participation in the self-

direct program” or “costs associated with procuring renewable energy credits through existing and

future contracts through the Adjustable Block Program, subsection (c-5) of this Section 1-75, and the

Solar for All Program,” although as the ICC recognized in Docket No. 22-0231, Section 1-

75(c)(1)(R)(4)’s reliance on crediting the “estimated portion” of utility-scale REC delivery costs could

create overlap into actual costs from those categories.

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6.5.1.1. Self-Direct Bill Crediting: Interpretive Issues

As described under this language, this calculation has multiple parts, including some contradictory

elements. The credit back to that customer hinges then on the “anticipated cost of renewable energy

credit deliveries under contracts for new utility-scale wind and new utility-scale solar entered for

each delivery year after” that participation begins. But that credit must be must also be “the

estimated portion of the cost authorized by subparagraph (E) of paragraph (1) of this subsection (c)

that supported the annual procurement of utility-scale renewable energy credits in the prior delivery

year.” Reconciling this language is not easy, but certain framing principles emerge that the IPA

believes are appropriate for implementation of the self-direct program.

As outlined above and reinforced by the Illinois Commerce Commission in Docket No. 22-0231, self-

direct bill crediting concerns only costs reflective of utility-scale wind and utility-scale solar

procurements, and expressly not “costs associated with procuring renewable energy credits through

existing and future contracts through the Adjustable Block Program, subsection (c-5) of this Section

1-75, and the Solar for All Program.” This provides a defined universe of contract types for which

costs can be utilized in establishing bill crediting levels. Self-direct bill crediting should also not

include “costs associated with any contracts entered into before the delivery year in which the

customer files the initial compliance report to be eligible for participation in the self-direct program,”

but this limitation introduces problematic variance in the self-direct credit level by basing that credit

level on the specific year of a given customer’s self-direct participation.

The Illinois Commerce Commission addressed these issues in approving the IPA’s Long-Term

Renewable Resources Procurement Plan in Docket No. 22-0231. The IPA’s filed Plan had originally

proposed that a customer’s crediting level be pegged to that customer’s first year of self-direct

program participation, with only REC delivery contract costs for utility-scale REC contracts entered

into after that participation providing the universe of contracts whose costs could be credited back

to customers. In its Final Order approving the Plan, the Commission concluded that “it is more

appropriate that a three-year rolling average of eligible utility-scale REC delivery contracts be used,

consisting of the two-years prior to the year being determined and the third year being the

anticipated costs” outlined in the Plan.

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This approach both addressed the Commission’s concern

that establishing the credit based on the self-direct customer’s participation date “instills too much

instability for Self-Direct Program participants”

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while also ensuring that only costs associated with

utility-scale REC delivery contracts were credited.

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See Docket No. 22-0231, Final Order dated July 14, 2022 at 39-40.

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Id. at 40.

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Id. at 39.

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Based on the IPA’s understanding of the Commission’s Order, self-direct crediting levels are still to

be determined annually—the Commission states that “the IPA’s proposed implementation of the

requirement to annually calculate the credit, which provides different credit levels based on a

customer’s date of enrollment” is what offers undesirable instability, and a methodology which looks

at “two year priors to the year being determined and the third year being the anticipated costs” will

necessarily require a different determination annually—but self-direct crediting levels are fixed

across all participants for a given delivery year, regardless of that customer’s first year of self-direct

program participation.

The Commission’s direction regarding the use of a three-year rolling average did not explicitly

address how the costs for each of the three years should be determined. The Commission explained

that the averaging approach would “reflect [the] statutory inconsistencies” and directed that “a three-

year rolling average of eligible utility-scale REC delivery contracts be used, consisting of the two-

years prior to the year being determined and the third year being the anticipated costs as outlined in

the [Plan].”

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The Order does not elaborate on which utility-scale REC contracts should be

considered “eligible,” nor does it reference the section of the Plan it is referring to regarding

anticipated costs. The Order might be understood to mean that only costs reflecting new contracts in

each of the three years should be considered. The Order might alternatively be read to mean that the

costs for all utility-scale RECs procured by the IPA for RPS compliance count for the previous two

years (regardless of when the contracts were entered into), but that for the future (third) year, the

Agency should use the methodology proposed in the Plan and limit the costs to those for new

contracts. Finally, the Order could be read to mean that actual or expected costs from all utility-scale

REC contracts used for RPS compliance should be considered (regardless of when the contracts were

entered into) for each of the three years.

The first of these options (only considering costs from new contracts in each of the three years) is

problematic because of the lag between when the Agency enters into contracts for utility-scale REC

procurement, and when those RECs are actually delivered and paid for. New utility-scale REC

contracts virtually never have “costs” in the first year, so the credit would be set to zero for much or

all of the time. This does not appear to be consistent with the Commission’s intent, as the Commission

expressly stated that it sought to avoid a lag between participation and crediting.

The second option (considering utility-scale contracts regardless of year entered into for the

previous two years, but only considering new contracts for the future year) is problematic because

that methodology would not produce a rolling average. To calculate a three-year rolling average, each

calculation removes the data for the first year, retains the data for the second and third years, and

adds in a new subsequent year, thereby “shifting” the three-year window forward by one year. If the

Agency limited the costs for the “future” or third year to only new contracts, but included contracts

regardless of age for the “previous” years one and two, it would be mixing apples and oranges. Each

new calculation shifting the window would change the cost amount for individual years, because the

universe of contracts (and therefore costs) would change.

The Agency believes the third option is the best interpretation of the Commission’s Order: including

costs for utility-scale REC contracts regardless of when the contracts were entered into in calculating

the costs for each of the three years. This allows the Agency to calculate a three-year rolling average

as directed by the Commission, and the resulting credit amount will be a non-zero number, which

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Id. at 39-40 (emphasis added).

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appears to best reflect the Commission’s desire to avoid a lag between participation and crediting. As

the Commission acknowledges in its Order, it could be argued that this approach is inconsistent with

the statutory directive to “not include . . . costs associated with any contracts entered into before the

delivery year in which the customer files the initial compliance report to be eligible for participation

in the self-direct program.”

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However, it is essentially impossible for an approach to comply with the requirement to not include

costs associated with pre-existing contracts and also comply with the Commission’s directions to 1)

apply the same annual credit amount to all self-direct customers, regardless of when the customers

began participation, and 2) avoid a lag between participation and crediting. Compliance with both

directions would only be possible if the credit (that applied to all self-direct customers) was limited

to costs for utility-scale REC contracts entered into after the date that the most recent self-direct

customer began participating; this would likely reset the credit to zero or near zero each time a new

self-direct customer begins participating. This seems entirely inconsistent with the Commission’s

intent. Therefore, in light of the conflicting directives, the Agency will follow the approach that

appears to best integrate both the statutory language and the Commission Order. That is, the Agency

will determine the self-direct credit each year based on the costs for utility-scale REC contracts in the

previous two years and anticipated costs for the next year, regardless of what year the underlying

REC contract was signed.

The Commission must “approve the self-direct credit amount by June 1, 2023 and June 1 of each

delivery year thereafter.” Under the methodology outlined in the Commission’s Order, the IPA

understands that its compliance filing seeking approval of the amount thus must include a credit

value “expressed on a per kilowatt hour basis” that would apply to all participants. Notably, if the

IPA’s understanding of this methodology is incorrect, parties may contest the proposed self-direct

values before the Commission and the Commission will provide a vote affirming those values before

finalization.

This crediting approach reflects something akin to a “like for like” crediting by class of expenditure—

the customer’s bill crediting level is determined using only utility-scale project RPS costs, based on

an average of those costs to the RPS budget over a three-year period, and should not reflect costs

used to support the ABP or ILSFA programs.

6.5.1.2. Self-Direct Bill Crediting Example

Consistent with the express limitations of Section 1-75(c)(1)(R)(4) and the Commission’s

interpretive decisions from Docket No. 22-0231, the following is an example of how the Agency

understands a self-direct crediting rate to be established. The Commission’s Order requires that “a

three-year rolling average of eligible utility-scale REC delivery contracts be used, consisting of the

two-years prior to the year being determined and the third year being the anticipated costs as

outlined in the [draft] LTRRPP.”

272

For illustrative purposes, assume participation for the 2023

delivery year (the first year of the program). For this example, the IPA will average the RPS budget

impacts for utility-scale REC delivery contracts across the 2021-22 and 2022-23 delivery years

regardless of when such contracts were executed and anticipated procurement costs associated with

those contracts for the upcoming (2023-24) delivery year. Similarly, self-direct crediting for the

271

Id. at 40 (quoting 20 ILCS 3855/1-75(c)(1)(R)(4)).

272

Id.

Illinois Power Agency 2022 Long-Term Plan (Final) August 23, 2022

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2025 delivery year would be dependent on actual utility-scale REC delivery contract costs from the

2023 and 2024 delivery years and anticipated costs for the 2025 delivery year. Anticipated costs

would be determined through a) the Agency’s estimate of by when those projects will become

energized and begin delivering RECs, and b) the Agency’s anticipated budget impacts from those

contracts based on its forward price curve calculation under Section 1-75(c)(1)(G)(v).

As distinguished from the proposal found in the filed Plan, one possible benefit of this approach is

the presence of a single self-direct crediting rate for a given program year. A “three-year rolling

average” will change year by year as the delivery years to compute that average change and those

years’ costs vary. But, for the 2027 delivery year, a customer with initial participation in 2024 would

receive the same crediting level as a customer with initial participation in 2026—even if that

crediting level will be different in the 2028 delivery year.

These anticipated delivery year costs would then be reduced down to an average fractional amount

of the amount of collections authorized under Section 1-75(c)(1)(E) of the Act for the three delivery

years. That fractional amount may be expressed as a percentage, and that percentage would then be

used for a per kwh calculation of the credit due back to participating customers. Thus, if the

volumetric RPS charge authorized by Section 1-75(c)(1)(E) was 1 cent per kilowatt hour, and

anticipated qualifying contract costs constituted 10% of the RPS expenditures across those three

years, then the applicable self-direct credit would be calculated as 0.1 cents per kilowatt hour. That

crediting level would then be applied to the entirety of that customer’s load so long as that customer

was retiring the qualifying percentage of RECs (at least 40% of load); for additional REC retirements

beyond 40%, the law does not contemplate an adjustment in crediting rate and the customer would

continue to be able to claim the environmental benefits of that renewable energy usage.

6.5.1.3. Self-Direct Bill Crediting: Compliance Filing

Section 1-75(c)(1)(R)(4) also requires that the IPA annually calculate the self-direct crediting

amount(s) and “submit this to the Commission in an annual compliance filing,” with the Commission

required to “approve the self-direct credit amount by June 1, 2023 and June 1 of each delivery year

thereafter.” This provision raises a series of procedural questions, as outlined below.

The first question is in what proceeding the Agency should provide its compliance filing. The Agency

believes that the proceeding featuring the most recently approved Long-Term Plan should be the

proceeding in which a compliance filing is made. Thus, for 2023, the Agency will submit its self-direct

crediting calculation within the proceeding used to approve this Long-Term Plan.

The second question concerns how the Commission is to “approve the self-direct amount,” as the

Commission does not traditionally “approve” a compliance filing. Instead, a compliance filing is

simply made to ensure compliance with a prior Commission directive; but unless prompted by a

reopening or motion, no Commission action is required. Here, the IPA believes it can best manage

the tension between Commission approval and the form of a compliance filing by a) engaging

stakeholders in a comment process on the self-direct crediting rate prior to making its compliance

filing and b) making its compliance filing early enough to allow for any parties to challenge that filing

through petition to the Commission. Further, under the Commission’s Order in Docket No. 22-0231,

the Commission must take an overt action every year to approve the self-direct credits, in the same

Illinois Power Agency 2022 Long-Term Plan (Final) August 23, 2022

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manner as the Commission approves benchmarks utilized for competitive procurements.

273

Thus,

after the IPA’s compliance filing and after allowing sufficient time for parties to contest that filing, the

Commission shall place on its agenda a vote to approve the self-direct credit.

274

The third question concerns timing: while the Commission must approve a self-direct crediting

amount by June 1 – the start of a delivery year – the Agency understands that this amount must be

known to Illinois electric utilities well before June 1 for application within the delivery year beginning

June 1. The Agency has proposed a schedule for the first year of the self-direct program later in this

Chapter and hopes that schedule may accommodate the utilities’ bill crediting calculation needs.

For the substance of the compliance filing, the Agency will include, at minimum, the following: actual

or anticipated costs of utility-scale REC delivery contracts by delivery year for the three years utilized

for the rolling average, including the anticipated volumes of REC deliveries from those projects and

aggregated assumptions about price (mindful of the confidentiality of individual bid prices) and a

narrative explanation of how and why those calculations were made, as well as the self-direct credit

applicable to all customers expressed as a per kilowatt-hour value. As the self-direct program confers

a benefit onto a large energy customer that is not otherwise available to other customers, the

compliance filing may also include an identification of participating customers and renewable energy

projects.

Separate from that compliance filing, Section 1-125(b)(5) of the IPA Act also now requires the Agency

to report annually on “the total amount of customer load featuring renewable portfolio standard

compliance obligations scheduled to be met by self-direct customers” pursuant to the self-direct

program, as well as “the minimum annual quantities of renewable energy credits scheduled to be

retired by those customers and amount of installed renewable energy generating capacity used to

meet” the self-direct program’s requirements.

6.5.2. Procurement Target Adjustments

Section 1-75(c)(1)(R)(3) provides that each REC procured in connection with the self-direct program

“shall reduce the total volume of renewable energy credits the Agency is otherwise required to

procure from new utility-scale projects pursuant to subparagraph (C) of paragraph (1) of this

subsection (c) on behalf of contracting utilities where the eligible self-direct customer is located.”

The Agency will include estimates of RECs procured in connection with the self-direct program, as

well as anticipated RPS budget adjustments necessitated by self-direct program bill crediting, in its

analyses of RPS Goals, Targets, and Budgets produced through its Long-Term Plans and interim

updates posted on its website.

6.6. Self-Direct Program Size & Selection

Section 1-75(c)(1)(R)(3) requires that the Agency shall “annually determine the amount of utility-

scale renewable energy credits it will include each year from the self-direct renewable portfolio

standard compliance program.” In making this determination, “the Agency shall evaluate publicly

available analyses and studies of the potential market size for utility-scale renewable energy long-

term purchase agreements by commercial and industrial energy customers and make that report

publicly available.” The Agency did not seek to establish a fixed first-year program size through this

273

Id. at 40-41.

274

See id.

Illinois Power Agency 2022 Long-Term Plan (Final) August 23, 2022

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Plan’s approval, and instead determined that it would be inappropriate to do so until after the Plan’s

approval by the Commission (after which all parties now have more certainty regarding the self-

direct program’s mechanics).

6.6.1. Current Publicly Available Analyses and Studies

Publicly available analyses and studies of the potential market size for utility-scale renewable energy

long-term purchase agreements by commercial and industrial energy customers include analyses of

large commercial and industrial (“C&I”) customer purchases of RECs or bundled renewable energy

and RECs from utility-scale renewable resources through power purchase agreements (“PPAs”) or

virtual power purchase agreements (“VPPAs”). PPAs require the delivery of electricity sold under

the agreement to the buyer, while VPPAs are financial transactions. VPPAs provide corporate buyers

with flexibility in terms of the location of the renewable resource in that the renewable energy is not

necessarily delivered to the buyer’s specific location and allows the buyer to hedge exposure to

wholesale market prices through a bundled financial transaction.

Data regarding the capacity and generation associated with large C&I PPAs and VPPAs announced or

executed with utility-scale wind and solar projects are available from several sources,

275

although

none of these data sources offer a comprehensive assessment of the potential size of the C&I self-

direct market in Illinois specifically. Several relevant studies conducted by third parties are currently

available.

276

The Agency can also utilize the latest C&I consumption and utility scale renewable

generation data available from the U.S. Energy Information Administration (“EIA”) to define the

overall size of the commercial and industrial electricity markets, as well as the amount of utility-scale

wind and utility-scale solar capacity and generation in Illinois.

277

The EIA reported that for 2020, sales of electricity to ultimate customers in Illinois for the

Commercial Sector amounted to 45,915,000 MWh, down from 49,279,000 MWh in 2019, and for the

Industrial Sector 39,105,000 MWh in 2020, down from 43,250,000 MWh in 2019.

278

Generation from

utility-scale wind and utility-scale solar projects for 2020 was reported as 17,204,000 MWh,

reflecting utility-scale wind capacity of 6,329 MW and utility-scale solar capacity of 115.7 MW. Most

of this generation and the associated capacity were not supplied directly to large C&I customers

under PPAs or VPPAs. More specific data is available from various sources that typically report the

amount of C&I renewable contract activity in terms of capacity, which can be converted to estimated

generation using historical capacity factors relevant to each technology.

However, total capacity in operation in any year does not provide an accurate indication of the likely

size of the Self-Direct Customer market. Historical annual capacity additions are a better indicator

of what can be expected for the number of RECs that could be procured annually through the Self-

275

The relevant data sources include S&P Global Market Intelligence, https://www.spglobal.com/marketintelligence/en/ , Clean Energy

Buyers Association (CEBA), “CEBA Deal Tracker”, “CEBA State of the Market Report.”, and Green Biz Clean Energy Deal Tracker.

276

In determining program size, the Agency plans to review the currently available or updated studies including (i) S&P Global Market

Intelligence, RRA Regulatory Focus, 2021 Corporate Renewables Outlook, April 21, 2021., (ii) J.Kobus, A.I. Nasrallah, J. Guidera, Columbia,

SIPA, Center on Global Energy Policy, “The Role of Corporate Renewable Power Purchase Agreements in Supporting U.S. Wind and Solar

Deployment, March 2021.”, and (iii) Retail Industry Leaders Association, “Corporate Clean Electricity Procurement Index 2020: State

Leadership & Rankings.”, March 2020. The Agency will also review other studies that may become available.

277

For example, see U.S. Energy Information Administration Electric Power Monthly, November 2021, Tables 5.4.A. and 5.4.B. -- Sales of

Electricity to Ultimate Customers by End-Use Sectors by State.

https://www.eia.gov/electricity/monthly/current_month/november2021.pdf

278

U.S. EIA, Electric Power Monthly, February 2021. www.eia.gov/electricity/monthly/.

Illinois Power Agency 2022 Long-Term Plan (Final) August 23, 2022

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Direct RPS Compliance Program. The Retail Industry Leaders Association, based on data obtained

from the Clean Energy Buyers Association, the Solar Energy Industries Association, and the American

Wind Energy Association, reported that the procurement of electricity from offsite third-party utility-

scale wind and utility-scale solar projects in Illinois increased from 175 MW in 2017 to 988 MW in

2020 or an annual average of 271 MW during that period.

279

Assuming a capacity factor of 30%, this

would be equivalent to 712,188 RECs during each of those years.

S&P Global Market Intelligence indicated that as of early 2021 there were almost 3,300 MW of

corporate renewable energy deals in place in Illinois.

280

Table 6-1 provides a summary of the specific

C&I renewable agreements with utility-scale wind and utility-scale solar projects in Illinois reported

by S&P Global.

Table 6-1: Representative Corporate Agreements with Utility-Scale Wind and Utility-Scale

Solar Projects in Illinois

Corporate Entity

Operation Date

Technology

Capacity under

Agreement (MW)

Microsoft

2015

Wind

175

Verizon

2020

Wind

130

FB/Meta

2021

Wind

170

Amazon

2022

Solar

100

Amazon

2022

Wind

100

Amazon

2022

Solar

While this is not a complete list of the C&I renewable resource agreements with utility-scale wind

and utility-scale solar projects in Illinois, it is representative of the deals in the market—which may

provide an indication of the number of RECs that could be procured through the Self-Direct RPS

Compliance Program. The reported Amazon deals would produce approximately 762,120 RECs in

the first full year of operations for these projects.

GreenBiz maintains an on-line blog that tracks and compiles major corporate renewable energy deals

on a quarterly basis since the first quarter of 2018.

281

The information on renewable energy deals is

based on corporate press releases, trade industry news alerts and media articles. Table 6-2 provides

a summary of the information complied by GreenBiz through the third quarter of 2021.

279

Retail Industry leaders Association, Corporate Clean Electricity Procurement Index 2020: State Leadership & Rankings.

280

S&P Global Market Intelligence, “RRA Regulatory Focus, 2021 Corporate Renewables Outlook,” April 21, 2021.

281

See www.greenbiz.com/blogs/enterprise/clean-energy-deal-tracker. Accessed 12/10/2021.

Illinois Power Agency 2022 Long-Term Plan (Final) August 23, 2022

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Table 6-2: Major Corporate Renewable Energy Deals in Illinois Tracked by GreenBiz

Corporate Entity

Date Reported

Technology

Proposed Capacity

(MW)

Bloomberg

2018

Wind

General Motors

2018

Wind

100

Comcast

2018

Wind

Salesforce

2018

Wind

Apple, Akamai, Etsy,

Swiss Re

2018

Wind

125

Starbucks

282

2018

Wind

Walmart

2018

Wind

Walmart

2018

Wind

123

Target

2019

Wind

St. Gobain

2020

Wind

120

Cargill

2020

Solar

200

FB/Meta

2020

Wind

130

Lowes

2020

Solar

250

JP Morgan Chase

2021

Wind

Mars, Inc.

2021

Wind

121

In 2020 a total of 700 MW of renewable energy contracts in Illinois were announced, which would

produce approximately 1,839,600 RECs.

In response to the IPA’s request for interested party comments on the size of the self-direct market,

Advanced Energy Economy and TechNet recommended that the program size should be 4,000 MW.

This program size recommendation is based on the 2021 Columbia study that new U.S. corporate

renewable energy capacity additions through 2030 would range from 55 GW to 85 MW. Assuming

that these capacity additions in Illinois would be in line with the EIA data that shows Illinois

electricity sales to be approximately 3.6% of total U.S. electricity sales, then the new corporate

renewable energy capacity for Illinois would be 3.6% of the total for the U.S. or in the range of 1,980

MW to 3,060 MW. To this range, TechNet added Advanced Energy Economy’s estimate of 1,650 MW

of existing corporate renewable energy capacity to yield an estimate of the self-direct market size of

3,630 MW to 4,710 MW which was rounded to 4,000 MW.

283

6.6.2. Establishing Program Size

The Agency plans to evaluate the studies and the data available from the sources discussed above,

including updates to the studies and data, to produce an annual report which will include an

assessment of the large C&I customer renewable energy market and estimates of the number of RECs

expected to be available from eligible C&I customers each year. Analysis included in the report will

also consider any applications from the prior year that could not be supported under that year’s

program size. That report will be made available by early January of each year—with the first such

report to be published in January 2023—and followed by a brief stakeholder comment process. After

the conclusion of that comment process, the Agency plans to announce the program size for the

282

Additional information for this PPA showed that the Starbucks agreement was with Enel Green Power North America, Inc.’s Hill Topper

wind farm in Logan County which would supply 48,000 MWh for 340 Starbucks stores in Illinois. Smart Energy Decisions, “Starbucks

reaches 100% RE in Illinois with wind power,” August 9, 2019.

283

See https://ipa.illinois.gov/energy-procurement/comments-on-the-draft-2022-long-term-renewable-resources-procure.html.

Illinois Power Agency 2022 Long-Term Plan (Final) August 23, 2022

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upcoming year delivery by February 1 of that calendar year. That program size will be published by

RECs, as envisioned under the law (“The Agency shall annually determine the amount of utility-scale

renewable energy credits it will include each year…”), but illustrative examples of installed capacity

needed to meet those REC totals by technology will also be provided.

The Agency is also considering a Request for Information process through which potentially-

interested self-direct customers could identify themselves to the Agency to help inform market size,

and hopes to work with both alternative retail electric suppliers and electric utilities involved with

bill crediting on promoting the self-direct program. The Agency will also consider developing

standardized materials about the program to assist in encouraging participation.

6.6.3. Selecting Between Competing Applications

Section 1-75(c)(1)(R)(3) also provides that “[i]f demand for participation in the self-direct renewable

portfolio standard compliance program exceeds availability, the Agency shall ensure participation is

evenly split between commercial and industrial users to the extent there is sufficient demand from

both customer classes.” This requirement contemplates that self-direct program applications will

not be reviewed and approved on a rolling basis, but instead will feature an application window

during which all applications are reviewed and determinations about selection – such as application

of this C&I balancing requirement – will be made at the conclusion of that window closing. As

explained later in this Chapter, the Agency proposes to structure its application process in

accordance with this structure.

This balancing requirement will operate to ensure that should the Agency receive more qualifying

applications than program capacity can support, priority shall be offered to ensure equal

participation between commercial customers and industrial customers. Thus, if program size is

100x, and the Agency has received 70x of qualifying commercial customer applications and 50x of

qualifying industrial applications, then the 20x of applications not selected should be taken from the

commercial customer segment.

However, this does not provide direction between how to choose between competing applications

within those categories. Informed by stakeholder comments received, the Agency proposes the

following approach to application selection should qualified applications exceed self-direct program

capacity:

First, the Agency will select applications in a manner consistent with the statutorily-mandated C&I

balancing requirement—thus, if less than half of the program size is met through commercial or

industrial customers, then all applications within that category will be considered selected. If both

categories have applications exceeding 50% of program capacity, then applications shall be selected

within a category consistent with the following paragraphs.

Next, customers with the highest percentage of RECs sourced from facilities located in Energy

Transition Community Grant areas will be given preference. This approach will help support

communities impacted by the closure of coal mines, fossil fuel and nuclear plants and provide the

commensurate employment opportunities that come from project development. This approach

aligns the self-direct program with Section 1-75(c)(1)(P) of the IPA Act prioritization of support for

those communities.

To next choose between any leftover competing applications within a given category (for instance, if

no customer’s projects are located in Energy Transition Community Grant areas), the Agency shall

Illinois Power Agency 2022 Long-Term Plan (Final) August 23, 2022

147

give priority to those applications which demonstrate the highest percentage of qualifying RECs

being retired relative to that customer’s usage from the previous delivery year. Thus, a contract

through which a customer’s usage is entirely met through a bundled (REC + energy) PPA or PPAs

would receive top priority.

Lastly, priority will be provided based on the total number of RECs planned to be procured and

retired annually under the application.

Projects not selected will be placed on an ordinal waitlist ranked in accordance with the criteria

above. Those projects will be required to reapply for consideration for the next program year, but

once qualified, will be provided top priority in selection for that year.

6.7. Self-Direct Program Application Process

Section 1-75(c)(1)(R)(5) provides a minimum series of items required to be included on a customer’s

application be a self-direct customer; those are outlined below:

(i) the customer's certification that, at the time of the customer's application, the customer

qualifies to be a self-direct eligible customer, including documents demonstrating that

qualification;

(ii) the customer's certification that the customer has entered into or will enter into by the

beginning of the applicable procurement year, one or more bilateral contracts for new wind

projects or new photovoltaic projects, including supporting documentation;

(iii) certification that the contract or contracts for new renewable energy resources are long-

term contracts with term lengths of at least 10 years, including supporting documentation;

(iv) certification of the quantities of renewable energy credits that the customer will purchase

each year under such contract or contracts, including supporting documentation;

(v) proof that the contract is sufficient to produce renewable energy credits to be equivalent

in volume to at least 40% of the large energy customer's usage from the previous delivery

year, measured to the nearest megawatt-hour; and

(vi) certification that the customer intends to maintain the contract for the duration of the

length of the contract.

Specific application forms will be developed by the Agency across late 2022 and early 2023, and

guidance regarding acceptable supporting evidence and documentation will be provided prior to the

program’s opening for application. At first blush, the Agency believes that supporting documentation

demonstrating (i) through (v) will include requiring a combination of customer billing information

(which is already required under Section 1-75(c)(1)(R)(3)) and the underlying legal instrument

through which the customer will procure RECs, with the applicant customer having the option of

redacting any confidential, non-essential information.

As Section 1-75(c)(1)(R)(5)(ii) contemplates situations where the customer merely “will enter into”

such contracts “by the beginning of the applicable procurement year,” a term sheet coupled with

certification may be adequate to satisfy this requirement for initial application, but participation will

be contingent on a binding REC delivery contract being provided to the Agency at least one month in

advance of the start of the delivery year.

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For purposes of demonstrating common corporate parent status, the Agency believes tax

identification numbers constitute appropriate proof, but not the only form of acceptable proof.

Alternative proof for meeting this requirement and other requirements may be considered on a case

by case basis, but in all cases must be accompanied by a certification from a senior officer from the

applicant customer.

For confidential, competitively sensitive information essential to determining whether the project,

customer, or contract qualifies for the program, applicants may submit redacted versions of

documents as outlined above. To be protected from disclosure under the Illinois Freedom of

Information Act, any such redactions must constitute “[t]rade secrets and commercial or financial

information . . . where the trade secrets or commercial or financial information are furnished under

a claim that they are proprietary, privileged, or confidential, and that disclosure of the trade secrets

or commercial or financial information would cause competitive harm to the person or business.”

284

As the disclosure of basic customer and project information cannot constitute “commercial or

financial information” which “would cause competitive harm” if disclosed, the IPA will not entertain

blanket confidentiality claims on the entirety of the application (but may on individual documents

within an application, where appropriate). As required under Section 1-120 of the IPA Act, the

Agency “shall provide adequate protection for confidential and proprietary information furnished,

delivered, or filed by any person, corporation, or other entity,” as the Agency presently does for

confidential and redacted documents that it routinely receives in conducing competitive

procurement events.

6.8. Self-Direct Program Opening

Section 1-75(c)(1)(R) requires that the self-direct RPS compliance program “shall take effect in the

delivery year commencing June 1, 2023.” The IPA understands this to mean that customer

participation will begin as of June 1, 2023, and thus that initial applications are required to be

received across the months preceding that start date.

The ICC approved the IPA Long-Term Renewable Resources Procurement Plan in July 2022. The IPA

proposes the following timeline of subsequent required steps for the first year of the self-direct

program:

• Jan 2023: IPA publishes its analysis of self-direct program size, takes stakeholder comments

• Feb 1, 2023: IPA publishes final program size

• Feb 1, 2023: IPA publishes application forms

• Feb 15, 2023-March 15, 2023: Applications for self-direct program received

• March 2023: Compliance filing for determining credit rate for upcoming delivery year

• March 15, 2023-April 15, 2023: Applications reviewed, program participation

determinations made and communicated to both applicants and applicable electric utilities

• June 1, 2023: First program year commences

• March 2024: Compliance filing for determining credit rate for next delivery year

• May 31, 2024: Conclusion of first program year

• July 30, 2024: Deadline for first program year compliance reports

284

5 ILCS 140/7(1)(g).

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As outlined above, the IPA is tentatively planning to provide its compliance filing in March 2023 for

establishing a credit rate for the 2023 delivery year.

6.9. Compliance Reporting

Section 1-75(c)(1)(R)(3) provides that participating self-direct customers “shall file an annual

compliance report with the Agency pursuant to terms established by the Agency through its long-

term renewable resources procurement plan to be eligible for participation in this program.” The

self-direct customers participating in the program will be required to file an annual compliance

report within 60 days after the conclusion of each delivery year of the program with the Agency in

order to remain eligible. This compliance report will provide updated information including:

1. The actual number of RECs retired in connection with the program for the self-direct customer

over that delivery year;

2. Documented proof that the RECs supplied to the program were retired;

3. The actual energy usage at the facilities participating in the program during the previous year,

based on the accounts of participating customers;

4. The total energy or RECs supplied to the self-direct customer by the renewable resource facilities

under the self-direct customer’s relevant contract(s) for the previous year; and

5. Any modifications or amendments to the contracts with renewable resource facilities.

Section 1-75(c)(1)(R)(6) provides that “[i]f a customer receives the self-direct credit but fails to

properly procure and retire renewable energy credits as required under this subparagraph (R), the

Commission, on petition from the Agency and after notice and hearing, may direct such customer's

utility to recover the cost of the wrongfully received self-direct credits plus interest through an adder

to charges assessed pursuant to Section 16-108 of the Public Utilities Act.” Should a customer fail to

submit its required annual compliance report, or should that annual compliance report not

demonstrate compliance with program requirements, the IPA may petition the Commission to claw

back wrongfully received self-direct credits from the non-compliant entity. Additionally, as also

envisioned under Section 1-75(c)(1)(R)(6), the Agency may bar such entities from continued

participation in the program.

All RECs qualifying for the program must be retired by or on behalf of the self-direct customer as

verified by the appropriate REC tracking system, either PJM Generation Attribute Tracking System

(PJM-GATS) or the Midwest Renewable Energy Tracking System (M-RETS).

As the first annual compliance reports will not be required to be filed with the Agency until the

Summer of 2024, the Agency plans to provide additional guidance on compliance reporting closer to

the date by which those reports must be filed. As with confidential application information, the

Agency commits to maintaining the confidentiality of any confidential or proprietary and

commercially sensitive information submitted in compliance reports.

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7. Adjustable Block Program

7.1. Background

Sections 1-75(c)(1)(K) and (L) of the IPA Act, as established by Public Act 99-0906 (effective June 1,

2017), required the Agency to establish an Adjustable Block Program for the procurement of RECs

from new photovoltaic distributed generation systems and from new photovoltaic community

renewable generation projects (colloquially known as “community solar”). The Adjustable Block

Program stands in contrast to the competitive procurements described in Chapter 5, in that the

Program features administratively determined prices for RECs and with enrollment on an ongoing

basis, rather than featuring discrete procurement events with competitively set, pay-as-bid prices.

Prior to the adoption of the Adjustable Block Program model, the development of new photovoltaic

distributed generation in Illinois had been supported in other ways. From 1999 to 2015, the

Department of Commerce and Economic Opportunity (“DCEO”) offered rebates for photovoltaic

projects; these rebates covered up to 25%-30% of the project cost and supported over 1,100 solar

PV projects with a total capacity of 13 MW.

285

The DCEO rebates were available once per year and

the available budget was quickly allocated, leading to uncertainty for installers about whether their

projects would or would not receive a rebate in any given year. No funds have been appropriated for

the rebate program in recent years.

Additionally, the IPA conducted Supplemental Photovoltaic Procurements in 2015 and 2016 under

authority granted by Section 1-56(i) of the IPA Act, and the Agency proposed and conducted

Distributed Generation procurements for the utilities from 2015 through 2017 (although these

procurements for the utilities were not limited to photovoltaic systems or to new systems) to meet a

statutory DG procurement target in the pre-P.A. 99-0906 RPS. The previous procurements

administered by the IPA featured competitive bidding for projects, and each winning bidder received

a contract through which RECs delivered were paid for at the bidder’s bid price. While this approach

created the market efficiency inherent in competitive bidding processes, installers of projects found

it difficult to sell projects when the potential REC revenue would not be known until a bid was

accepted (or alternatively there would be no REC revenue if a bid was not accepted). To mitigate that

challenge, the Agency allowed bidders to bid on forecasted blocks of RECs for systems below 25 kW

and give developers time to identify projects using a known REC price.

7.1.1. Future Energy Jobs Act

The Adjustable Block Program, as created by Public Act 99-0906 (colloquially known as the Future

Energy Jobs Act), was developed with the intent to address the issues inherent in the previous ways

that Illinois supported the development of new photovoltaic distributed generation.

In developing the structure of the Adjustable Block Program, the Agency considered its review of the

experiences of other jurisdictions (including relevant experiences from Germany, Spain, California,

and particularly Massachusetts and New York

286

), what it learned from previous procurements it has

administered, and the feedback it received from stakeholders. For issues that are not expressly

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See Renewable Energy, Energy Efficiency, and Coal Resources Development Law of 1997, 20 ILCS 687/6-1 et seq.

286

A summary of those other programs is available in Appendix C of the Initial Plan available at:

https://ipa.illinois.gov/content/dam/soi/en/web/ipa/documents/2018procurementplan/ltrrpp-filed-appendix-c-review-other-

programs.pdf.

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addressed in the Act, the Agency made decisions regarding implementation that it believed would

result in a cost effective and successful program, with those decisions then vetted through the

Commission’s Plan approval process in Docket Nos. 17-0838 and 19-0995. In some cases, opposing

or variant positions taken by other litigants were ultimately agreed to by the Agency or otherwise

adopted in the Commission’s orders approving the Initial and Revised Long Term-Plans.

As initially designed, the Adjustable Block Program featured an approach that was open on an

ongoing basis, rather than relying on specific procurement events (or rebate application windows).

Participation in the program took place through entities called Approved Vendors, who submit

project applications on behalf of program participants. Under P.A. 99-0906, the program also

accommodated community solar project applications, so that homes and businesses that cannot

place solar on their property can nonetheless participate in, and benefit from, direct access to

renewable energy.

The latest program expansion, pursuant to Public Act 102-0662, also includes new program

categories for community-driven community solar projects, public school projects, and projects

developed by equity eligible contractors; each of these will be discussed in depth in later sections of

this Chapter. The shift to an annual block structure, through which blocks open annually at a set price

rather than with a new block opening upon capacity being filled, likewise constitutes a significant

shift. In addition, entities participating in the Adjustable Block Program will need to comply with the

provisions of the Equity Accountability System described in Chapter 10 starting with project

applications on or after June 1, 2023.

The program initially opened in January 2019. Community solar blocks were quickly filled after

program opening. Additionally, both the Small and Large distributed generation blocks were filled

by December 2020. Funding limitations existing from December 2020 until the adoption of Public

Act 102-0662 in September 2021 created long waitlists for distributed generation and community

solar projects. However, the passage of Public Act 102-0662 provided sufficient funding for new

project application support and required opening of new blocks by December 14, 2021. Those blocks

closed June 30, 2022, and new blocks subject to this Plan will open in Fall 2022 as discussed below.

7.1.2.

2021 Program Status and Lessons Learned

The Agency published a draft Second Revised Long-Term Renewable Resources Procurement Plan in

August 2021, which featured significant discussion of the funding limitations existent at the time.

Subsequently, the enactment of Public Act 102-0662, also known as the Climate and Equitable Jobs

Act (colloquially known as “CEJA”), provided a resolution of the funding issue in addition to many

other changes outlined in Chapter 2, and the Agency withdrew the draft Plan in accordance with

direction provided through Section 1-75(c)(1)(A) of the IPA Act. Changes to the IPA Act under P.A.

102-0662 required the Agency to publish a draft 2022 Long-Term Plan within 120 days of its

passage.

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In addition to alleviating the funding limitations for the RPS, P.A. 102-0662 added new

requirements for the program discussed in later sections of this Chapter.

The funding and capacity made available by Public Act 102-0662 will allow the Agency to continue

developing and improving the Adjustable Block Program. The Agency has also updated the program

by drawing from knowledge gained from its successes and challenges to date.

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20 ILCS 3855 1-75(c)(1)(A).

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There were several challenges specific to the program’s Community Solar category under P.A. 99-

0906. At program opening, interest from Approved Vendors in the category was high and outpaced

the capacity available for this project type. As a result, the community solar blocks did not remain

open and did not go through a declining block progression as planned. After capacity was awarded

through a lottery process, remaining community solar project applications (and any new applications

submitted) were placed on lengthy waitlists. Additionally, the community solar projects that were

developed through this block category lacked diversity – projects tended to be similarly large (2 MW),

agrarian, and transactional rather than the community-based, diverse projects that may hoped and

expected to see.

The Adjustable Block Program overall faced a challenge in the form of the lack of RPS funding across

2020 and 2021, which stemmed in part from the inability to roll over RPS collections under Section

16-108(k) of the PUA, and was compounded by energization delays attributed to the COVID-19 global

pandemic. Absent sufficient funds, the program could not open additional blocks of capacity to serve

the market and support additional projects without a legislative fix.

Despite these challenges, the Adjustable Block Program has been successful overall, leading to the

energized or planned development of over 670 MW of new solar generation in Illinois thus far. The

Adjustable Block Program REC targets defined in Public Act 99-0906 for the end of the 2020 delivery

year – 1,000,000 RECs delivered annually from Adjustable Block Program projects – were fully met

through REC contracts, and the projects built as a result of participation in the program are generally

geographically diverse, with projects spread across the state. Additionally, there are over 200

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Approved Vendors available to support Illinois residents and businesses develop solar and subscribe

to community solar projects through the program.

7.1.3. Overview of Public Act 102-0662 Modifications

With Public Act 102-0662 taking effect on September 15, 2021, the Adjustable Block Program will

undergo sweeping changes, necessitating updates to program requirements (with much of that

process already having begun). One of the primary changes will be to the program’s scale resulting

from budget changes to the Renewable Portfolio Standard, which is discussed in depth in Chapter 3.

Section 1-75(c)(1)(C) of the IPA Act targets approximately 12,375,000 RECs delivered annually to be

procured from new Adjustable Block Program projects by 2030, necessitating perhaps up to 7000

megawatts of new distributed generation and community solar capacity.

Other key statutory or administrative updates to the program include, but are not limited to:

• Changes to the sizes applicable to Small and Large Distributed Generation categories and to

the size threshold applicable to Large DG and community solar projects

• New program categories for projects located at public schools, community-driven community

solar projects, and projects from Equity Eligible Contractors

• New block capacity allocations

• Updated REC prices

• Prevailing wage requirements for non-exempted projects

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Though the Adjustable Block Program has 417 Approved Vendors, the number of actively participating is fewer.

Illinois Power Agency 2022 Long-Term Plan (Final) August 23, 2022

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• Changes to contract payment terms, including a pay-upon-delivery structure for certain

Category

Allocation

Group A (MW)

Group B (MW)

Small Distributed Generation

20%

Large Distributed Generation

20%

Traditional Community Solar

30%

140

Public School Projects

15%

Community-Driven Community Solar

Equity Eligible Contractor Projects

10%

Total

100%

200

467

The total of these blocks sizes, in combination with prior waitlist allocations in the case of traditional

community solar, creates a program capacity on an annual basis equivalent to capacity that the

Agency had proposed for the first three years of the Adjustable Block Program back in 2018, which

ended up being fully allocated in approximately two years’ time. This increase in program size will

allow for the solar industry in Illinois to continue to grow and the Agency expects to propose larger

block sizes in the next Long-Term Plan scheduled for finalization in 2024 (including an increase in

the allocation to Equity Eligible Contractor projects as discussed in Section 7.4.6 below).

7.3.4. Opening of 2022 Delivery Year Blocks & Subsequent Annual Block

Openings

The Agency is faced with a timing challenge for the opening of the 2022-2023 delivery year, given

that each delivery year is now associated with a single block of capacity for each category. This

challenge arises due to the fact that this Long-Term Plan is not expected to be approved by the ICC

until July 19, 2022, while the 2022-2023 delivery year begins June 1, 2022. The Agency initially

proposed to address this timing challenge through a pause of project applications beginning on June

1, 2022 and extending through August 1, 2022. During the litigation of this Plan before the

303

These totals are preliminary amounts unadjusted for an unallocated capacity from prior program years. The final allocation for the

2022-2023 delivery year will be outlined in the next iteration of the ABP Program Guidebook published in accordance with this Final

Plan.

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At the time of publication of this Plan, the calculation of uncontracted capacity for Program year 2021-22 was not yet complete. Per

Section 7.3.5 of this Plan, block sizes for the 2022-23 Program year will increase slightly based on reallocation of uncontracted capacity.

Illinois Power Agency 2022 Long-Term Plan (Final) August 23, 2022

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Commission, the IPA proposed to shift that application pause period back one month, to begin on

June 30, 2022 and extend through August 31, 2022.

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The Commission found this proposal to be

reasonable and approved the modified timeline in its Final Order approving this Plan.

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The Agency will begin to accept applications for all categories except traditional community solar on

September 1, 2022, with the caveat that date may need to be postponed if there are significant

unexpected implementation issues arising from the ICC’s approval of this Plan. As explained in

Section 7.3 above and further in Section 7.4.3 below, the Agency will begin to accept applications for

the Traditional Community Solar category on November 1, 2022.

This timing challenge arises only in the context of opening annual blocks for the 2022-2023 delivery

year; beginning with the 2023 delivery year and for all subsequent delivery years, the Agency would

open all blocks of capacity on June 1. This schedule is reflected in Table 7-3 in Section 7.3.2.

7.3.5. Uncontracted Capacity at the Close of a Delivery Year

As the program shifts to a schedule of annual blocks of capacity and away from a structure where

blocks remain open until block capacity is exhausted, unused or uncontracted capacity could remain

at the close of a delivery year. Changes to the IPA Act made through P.A. 102-0662 now requires that

“uncontracted capacity” to be “redistribute[d]” to “one or more other categories.”

In relevant part, Section 1-75(c)(1)(K) of the Act now states:

“To the extent there is uncontracted capacity from any block in any of categories (i) through

(vi) at the end of a delivery year, the Agency shall redistribute that capacity to one or more

other categories giving priority to categories with projects on a waitlist. The redistributed

capacity shall be added to the annual capacity in the subsequent delivery year, and the price

for renewable energy credits shall be the price for the new delivery year. Redistributed

capacity shall not be considered redistributed when determining whether the goals in this

subsection (K) have been met.”

This language raises questions about a) by when an “uncontracted capacity” determination would be

made and b) how redistribution prioritization across “one or more other categories” with

prioritization “to categories with projects on a waitlist” will be applied. The Agency’s approach will

preserve capacity in the new categories of the Adjustable Block Program as those categories develop,

and will preserve capacity in the Equity Eligible Contractor category. The following approach to the

redistribution of excess capacity was developed through the approval of the Plan in ICC Docket No.

22-0231 and approved by the Commission through its Final Order in that proceeding.

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All capacity in the new Public Schools and Community-Driven Community Solar categories that

remains uncontracted from the blocks opened on December 14, 2021 will be rolled over within that

same category to the 2022-2023 delivery year. At the end of the 2022-2023 delivery year, if

uncontracted capacity remains in the Public Schools and Community-Driven Community Solar

categories, 50% of that capacity will rollover into the capacity allocation for the 2023-2024 delivery

year, while the other 50% will be allocated in accordance with the process outlined below.

305

During this pause Approved Vendors and Designees are able to generate Disclosure Forms.

306

See Docket No. 22-0231, Final Order dated July 14, 2022 at 42-43.

307

See Docket No. 22-0231, Final Order dated July 14, 2022 at 44.

Illinois Power Agency 2022 Long-Term Plan (Final) August 23, 2022

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The Agency will determine the amount of uncontracted capacity across all program categories (with

the caveat related to the Public Schools and Community-Driven Community Solar categories for the

2022-2023 and 2023-2024 delivery years outlined above, and preserving Equity Eligible Contractor

capacity generally) within one week after the closing date of that year’s annual blocks. That

uncontracted capacity will be summed to a total amount, with distribution of that total amount made

according to the prioritization below.

• The Agency will first allocate any uncontracted capacity to the Equity Eligible Contractors

category to select waitlisted projects from this category.

o As the only category which is expressly sought to be expanded over time, growing to

40% of the ABP by 2030, this approach allows the Agency to expand capacity

allocated to the EEC category should demand allow. In addition, as P.A. 102-0662

prioritizes the diversification of the Illinois clean energy economy and instructs the

Agency to provide better and broader access to Equity Eligible Contractors through

its solar programs, this approach best meets the spirit of the law.

o If there is unallocated capacity in the Equity Eligible Contractor category, that

capacity will not be reallocated to other categories. If substantial unused capacity

remains within this category, the IPA will work with stakeholders to identify barriers

to participation in this category and develop plans to mitigate those barriers

• Next, the Agency will prioritize reallocation of any remaining uncontracted program capacity

to the Small Distributed Generation category to select waitlisted projects from this category.

o This approach helps maximize the number of Illinois residents and/or businesses

that can benefit from the Adjustable Block Program.

• Next, the Agency will prioritize reallocation of any still remaining uncontracted program

capacity to the Community-Driven Community Solar category if a waitlist of Community-

Driven Community Solar projects has formed. Eligible waitlisted projects will be selected by

scoring rank order (which establishes the ordinal waitlist for that category) and will be

required to have met the minimum scoring threshold for selection.

o This category is prioritized in recognition of the concern that community solar project

development in Illinois has been largely homogenous since program inception. This

new program category was established to diversify the community solar market

through community-driven projects, and allocating waitlisted capacity maximizes its

impact.

• If uncontracted capacity remains after prioritized reallocation to these three program

categories, the Agency will evenly distribute the remaining uncontracted capacity across the

remaining program categories featuring waitlists. Should a category’s waitlist be satisfied by

less capacity than that distribution, then the remaining capacity shall be added to the other

category or categories featuring waitlists.

If any or all uncontracted capacity cannot be used to satisfy existing waitlists, then that remaining

uncontracted capacity will be distributed across all program categories on a pro rata basis

corresponding with those categories Section 1-75(c)(1)(K) percentage allocations.

The Agency will publish its capacity redistribution within one week after determining the sum total

of capacity (i.e., within two weeks after the close of that year’s annual blocks). Capacity distribution

to categories featuring waitlists will result in projects selected off of those waitlists by waitlist order,

with the resulting contract price at the price of the next annual block. Published block capacities for

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that next annual block will be updated to reflect that category’s expanded, and now-filled, capacity

additions.

For waitlisted capacity not met through uncontracted capacity redistribution, Section 1-75(c)(1)(K)

also provides that “the waitlist of projects in a given year will carry over to apply to the subsequent

year when another block is opened.” Thus, those waitlisted projects will be given priority in selection

within their category under that new delivery year’s capacity allocation to that category.

7.4. Adjustable Block Program Categories

Through the enactment of Public Act 102-0662, three new categories (Public Schools, Community-

Driven Community Solar, and Equity Eligible Contractors) were added to the Program’s existing three

categories (Small Distributed Generation, Large Distributed Generation, and Traditional Community

Solar). Each project application submitted to the program after the passage of Public Act 102-0662

will apply to one of these six categories.

Pursuant to the requirements of P.A. 102-0662, projects in each of these six categories are subject to

the prevailing wage requirements in the Prevailing Wage Act (820 ILCS 130/et seq.), except as noted

within the category descriptions below.

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Prevailing wage is a minimum compensation level by

county set by the Illinois Department of Labor for construction activities related to public works.

Additionally, Public Act 102-0673, which became effective on November 30, 2021, clarifies that

projects receiving incentives under the Program are “public works” subject to the Prevailing Wage

Act —which requires compliance with additional provisions under the Prevailing Wage Act, including

notice requirements.

7.4.1. Small Distributed Generation

The Small Distributed Generation category includes distributed generation projects up to and

including 25 kW in size. The Small Distributed Generation category will comprise at least 20% of the

ABP capacity generally.

Each project that is constructed in this category will be subject to prevailing wage requirements

included in the Prevailing Wage Act

309

except the following types of projects:

• Projects that serve a single-family or multi-family residential building, and

• Projects that serve a house of worship and are not greater than 100 kW AC (aggregated with

any co-located projects)

• Projects for which construction can be demonstrated to have been completed before

September 15, 2021, the effective date of Public Act 102-0662.

7.4.2. Large Distributed Generation

The Large Distributed Generation category includes distributed generation projects greater than 25

kW in size up to and including 5 MW. The Large Distributed Generation category will comprise at

least 20% of the ABP capacity generally.

308

See 20 ILCS 3855 1-75(c)(1)(Q).

309

See 820 ILCS/130 et. seq. Prevailing wage requirements are discussed in more detail in Section 7.6 of this Chapter.

Illinois Power Agency 2022 Long-Term Plan (Final) August 23, 2022

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Each project that is constructed in this category will be subject to the prevailing wage requirements

included in the Prevailing Wage Act with the exception the following types of projects:

• Projects (greater than 25 kW AC) that were on a waitlist as of the Program’s reopening on

December 14, 2021

• Projects that serve a single-family or multi-family residential building

• Projects that serve a house of worship and are not greater than 100 kW AC (aggregated with

any co-located projects)

• Projects for which construction can be demonstrated to have been completed before

September 15, 2021, the effective date of Public Act 102-0662

7.4.3. Traditional Community Solar

The Traditional Community Solar category

310

now allows for community solar projects up to and

including 5 MW in size (increased from 2 MW). Capacity for the Traditional Community Solar

category for the first two years after the effective date of Public Act 102-0662 were allocated to

projects already on ordinal waitlists as of Public Act 102-0662’s enactment, as outlined below.

311

Traditional Community Solar projects must have subscriptions of 25 kW or less constitute at least

50% of the facility’s nameplate capacity. The Traditional Community Solar category will generally

comprise at least 30% of the ABP capacity. Traditional Community Solar projects will now also

feature 20-year REC delivery contracts that pay for RECs over time as they are delivered, rather than

the front-loaded payment schedule previously used for community solar.

For Traditional Community Solar projects, P.A. 102-0662 allocated 250 MW (30% or 75 MW to Group

A, and 70% or 175 MW to Group B) of new Adjustable Block Program capacity to Approved Vendors

(including affiliates) having waitlisted ABP community solar applications in proportion to the

capacity of their waitlisted applications that meet the following requirements: 1) were eligible for

the April 10, 2019 lottery, 2) were on the ABP community solar waitlist as of December 31, 2020, and

3) are currently active (Part I status remains verified). The Adjustable Block Program Administrator

reviewed portfolios of projects submitted by the March 14, 2022 deadline through the waitlist

allocation process published on the Program website. The Agency allowed Approved Vendors to

request that projects be held from submission to the Commission for approval in order to determine

whether a substitution of the project may be necessary under Section 1-75(c)(1)(G)(iv)(3)(iii) of the

IPA Act. The Agency announced the publication of project information for the selected projects on

April 14, 2022, on the Program website.

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Section 1-75(c)(1)(K)(iii) provides that “capacity for this category for the first 2 delivery years” shall

be allocated according to the block reopening process described in Section 1-75(c)(1)(G)(iv), with

this category opening for project applications “starting in the third delivery year after the effective

date” of P.A. 102-0662 “or earlier if the Agency determines there is additional capacity needed for to

[sic] meet previous delivery year requirements.” As outlined in Section 7.3 above, the Agency plans

310

“Traditional Community Solar” is used to designate projects described in Section 1-75(c)(1)(K)(iii) for clarity to distinguish these

projects from the newly established Community-Driven Community Solar project category.

311

As required by Section 1-75(c)(1)(G)(iv)(3) of the IPA Act, for the December 14, 2021 block reopening, project size was still limited to

2 MW as waitlisted projects were proportionately allocated to Approved Vendors with valid projects that were both on waitlists as of

December 31, 2020 and originally eligible for the April 2019 community solar project selection process.

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https://illinoisabp.com/2022/04/14/publication-of-project-information-for-selected-waitlisted-community-solar-projects/

Illinois Power Agency 2022 Long-Term Plan (Final) August 23, 2022

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to initially open the Traditional Community Solar Category for project applications on November 1,

2022.

For Traditional Community Solar blocks that open after the approval of this 2022 Long-Term Plan,

Section 1-75(c)(1)(K)(iii)(1) specifies that “the Agency shall select projects on a first-come, first-

serve basis, however the Agency may suggest additional methods to prioritize projects that are

submitted at the same time.” The Agency proposed, and the Commission affirmed, an approach

whereby “submitted at the same time” be considered on a first day basis rather than the exact second

(or nano-second) that a project application is submitted at program opening. This is intended to

prevent an unfair advantage to entities that have a faster internet connection while maintaining the

spirit of the law.

As the Agency expects that it is likely that applications for Traditional Community Solar projects

submitted even on the first day of block opening may continue to exceed block capacity, some

methodology for distinguishing between those projects must be employed. Noting the distaste that

market participants have voiced for random selection processes, the Agency proposes to utilize a

scoring system that prioritizes qualitative aspects of individual projects. For the sake of clarity, this

approach maintains the “first-come, first serve basis” outlined in the law, but seeks to score projects

only if more project applications are received on that “first” day than the Agency has capacity

available in the program.

In developing its scoring system, the Agency has, in some cases, attempted to avoid overlap with the

qualitative scoring provided to community-driven community solar projects under Section 1-

75(c)(1)(K)(v); however, the Agency is also mindful of that category demonstrating characteristics

featuring express support by the General Assembly. This scoring system focuses on qualitative

aspects of projects with an eye toward objectives outlined in declaratory paragraphs or other

statutory language found in the Illinois Power Agency Act. Additionally, given the repeated advocacy

by solar industry trade associations (including through comments on the Draft Plan), this scoring

system also provides additional credit to projects featuring earlier interconnection agreement dates.

While the IPA is reluctant to decide between competing applications using qualitative criteria (such

as interconnection agreement effective date timing) that a) has no express support in statute and b)

does not appear to constitute progress toward an important policy objective, further differentiating

between applications using transparent criteria may prevent receiving many times more

applications than slots available in the program, as potential project applications unable to favorably

differentiate themselves may never apply. Additionally, basic principles of fairness support

providing more favorable treatment to proposed projects that have been under development for a

longer period of time.

Thus, if applications on Day 1 exceed block capacity, as modified by the Illinois Commerce

Commission’s Order in Docket No. 22-0231, the Agency will prioritize project applications utilizing

the scoring system outlined below. Certain aspects of the scoring system will be determined through

a stakeholder comment process conducted subsequent to this Plan’s filing with the Commission, with

details still being determined as of the date of this filing.

Projects may receive up to the maximum number of points listed for each of the four sections below.

A project’s score will sum to the points it receives across all four sections.

1. Built Environment – Maximum of 4 points permitted

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a. Sited on “disturbed land” as defined by United States Geological Survey,

313

“contaminated lands” as defined by the United States Environmental Protection

Agency,

314

or rooftops or other structures as outlined in the Commission’s Final

Order.

315

(Add 2 points)

b. Sited on a brownfield, as defined in Section1-10 of the Act and further clarified in

Section 5.4.2 of the Plan. (Add 2 points)

c. Commitment to utilize agrivoltaics or dual use solar.

316

(Add 1 point)

d. Commitment to pollinator friendly habitat, as defined in in the Pollinator Friendly

Solar Site Act (525 ILCS 55). (Add 1 point)

e. Sited on Conservation Opportunity Areas as defined by the Illinois Department of

Natural Resources.

317

(Subtract 2 points, unless the project received points for 1.d.

and is sited in an Environmental Justice Community, an R3 area, and/or on a

brownfield site, contaminated land, or rooftop or other structure

318

)

2. Siting – Maximum of 4 points permitted

a. Sited in an Environmental Justice Community. (Add 2 points)

b. Sited on land owned by a non-profit or public entity. (Add 2 points)

c. Sited in a county (or a township within Cook, DuPage, Kane, Lake, McHenry or Will

County) that does not currently have a community solar project that was approved

by the ICC for a REC contract under the Adjustable Block Program at the time of

application. (Add 2 points)

3. Equity Eligible Contractors – Maximum of 4 points permitted

a. Project is developed by an EEC certified Approved Vendor and can demonstrate

contractual commitments for all project development work to be performed by EEC

certified Designees. (Add 4 points)

b. Project is developed by a non-EEC certified Approved Vendor and can demonstrate

contractual commitments for all project development work to be performed by EEC

certified Designees. (Add 3 points)

c. Project is developed by an EEC certified Approved Vendor and the contractual

commitments for EEC certified Designee(s) that work on the project represent 50%

or more of the project’s REC Contract value (Add 2 points)

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The USGS further defines disturbed lands between mechanically and non-mechanically disturbed lands, both which fall under the larger

umbrella of disturbed lands used in this Plan.

Mechanically disturbed - Land in an altered and often non-vegetated state that, due to disturbances by mechanical means, is in

transition from one cover type to another. Mechanical disturbances include forest clear-cutting, earthmoving, scraping, chaining,

reservoir drawdown, and other similar human-induced changes.

Nonmechanically disturbed - Land in an altered and often non-vegetated state that, due to disturbances by nonmechanical

means, is in transition from one cover type to another. Nonmechanical disturbances are caused by wind, floods, fire, animals,

and other similar phenomenon.

314

See US EPA definition for contaminated lands here: https://www.epa.gov/report-environment/contaminated-

land#:~:text=Contaminated%20lands%20include%3A,disasters%20or%20acts%20of%20terror.

315

See Docket No. 22-0231, Final Order dated July 14, 2022 at 60.

316

Specific details around demonstrating and verifying use for these and other purposes will be established at a later date. See Docket

No. 22-0231, Final Order dated July 14, 2022 at 60.

317

IDNR Conservation Opportunity Areas are mapped here:

https://www2.illinois.gov/dnr/conservation/IWAP/pages/conservationopportunityareas.aspx

318

See Docket No. 22-0231, Final Order dated July 14, 2022 at 59-60.

Illinois Power Agency 2022 Long-Term Plan (Final) August 23, 2022

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d. Project is developed by a non-EEC certified Approved Vendor and the contractual

commitments for EEC certified Designee(s) that work on the project represent 50%

or more of the project’s REC Contract value (Add 1 point)

4. Interconnection Application Effective Date – Maximum of 4 points permitted

The Agency initially proposed a scoring process that would award higher points to

projects with earlier original interconnection dates, giving fractionally different

points for each. In approving this Plan, the Commission found that the Agency should

“encourage” having a currently valid, executed interconnection agreement as a

scoring criterion under this category.

319

The Agency will consult with stakeholders

in determining the appropriate number of points to assign to this criterion.

Additionally, the Agency will consider and discuss with stakeholders the JSP’s two

additional interconnection scoring criteria, the removal of the proposed

interconnection criteria outlined in the filed Plan, and any other interconnection-

related criteria that the Agency believes warrants consideration.

320

The IPA plans to issue a strawman proposal to initiate this stakeholder feedback

process. The Agency will review and consider the stakeholder feedback and expects

to issue a final determination on the scoring award related to interconnection

agreements/applications prior to the opening of the Traditional Community Solar

category on November 1, 2022, but subsequent to the finalization and filing of this

Plan. Accordingly, the finalized Traditional Community Solar scoring rubric will be

posted on the Program website and incorporated into the Program Guidebook, but

cannot be outlined within this Final Plan.

For a project receiving points under any criteria listed above that includes a commitment, if the

project is selected, the resulting REC delivery contract will include a requirement that the

commitment is met as of the Part II verification, with failure to meet, and maintain, the commitment,

an event of default that would lead to termination of the contract or product order (and forfeiture of

associated collateral). Should the Agency determine that a commitment was not made with a good

faith intent to comply, the Agency may consider disciplinary action against that Approved Vendor,

including suspension of the ability to submit future applications.

After this scoring criteria is applied to the universe of received projects, each project will be given a

score resulting in a rank, which then results in an ordinal list. This ordinal list will be used to select

projects for the delivery year in which the process takes place and will establish the initial project

waitlist. Any applications submitted after the first day of annual block opening will be slotted on the

waitlist behind those project applications received on the first day and prioritized based on time and

date received and will not be scored. The resulting ordinal waitlist will be used to select any

additional projects should capacity become free within that delivery year or should the category

receive a redistribution of uncontracted capacity as described in Section 7.3.5. As Section 1-

75(c)(1)(K) requires that “the waitlist of projects in a given year will carry over to apply to the

subsequent year when another block is opened,” projects remaining on the ordinal waitlist after

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Specifically, the Commission determined that “having a currently valid, executed ICA should be encouraged and included as one of the

scoring criteria in the IPA’s waitlist scoring system, as the JSPs propose” and directed “to include this scoring criterion within its

interconnection scoring category” while leaving “the appropriate number of points to assign to this criterion” a decision to be made by

the IPA “in consultation with stakeholders.” Docket No. 22-0231, Final Order dated July 14, 2022 at 58.

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See Docket No. 22-0231, Final Order dated July 14, 2022 at 58-59.

Illinois Power Agency 2022 Long-Term Plan (Final) August 23, 2022

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reallocation of uncontracted capacity as described in Section 7.3.5 will be prioritized for selection in

the next delivery year. In approving this approach, the Commission also found that a minimum

threshold point requirement was necessary to enter the waitlist.

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The Agency will continue

stakeholder discussions to determine the appropriate numerical threshold—which, as required by

the Commission’s Order, will be above the number of points awarded to those projects which have a

currently valid, executed interconnection agreement. The Agency’s approach will be finalized and

published in accordance with the stakeholder process outlined above relating to interconnection

criteria scoring.

The Agency also proposes the application of a 20% developer cap for any affiliated

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family of project

developers for this Traditional Community Solar capacity. Any affiliated family of project developers

which exceeds 20% of the awarded capacity in a given year’s Traditional Community Solar block

(determined separately for Groups A and B) will have any projects that cause them to exceed the 20%

capacity cap moved to become the first projects on the waitlist for the applicable group. If multiple

affiliated entities exceed the 20% cap, then the projects moved to the beginning of the waitlist(s) will

be ranked by the scores the received, with random selection used to break any ties. The 20%

developer cap applicable to one year’s project selections will carry over to subsequent delivery years

should a given year’s waitlist be utilized for the next year’s project selections. Details on the

application of the developer cap will be part of the stakeholder process outlined above.

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If further ordering is required across first-day projects (for instance, ordering of projects featuring

the same score where projects receiving that score span across selected and unselected capacity

within that block), the Agency proposes only then to utilize a random selection process to create a

rank-order within those equivalently-scored projects. This process would only be developed by the

Agency if/when the need arises based on the block capacity represented by first-day applications

received and a need to differentiate between equivalently-scored projects.

The Agency will endeavor to publish the scores and related materials for all participating projects

after project selection takes place to ensure transparency and inform applicants in future Program

years.

The Agency considered the development of scoring criteria for Traditional Community Solar projects

that included subscriber commitments, including commitments to utilize a certain percentage of local

subscribers, a certain percentage of small subscribers, and/or a certain percentage of low-income

subscribers. While these types of requirements may be applicable to Community-Driven Community

Solar and Low-Income Community Solar participating in the Illinois Solar for All Program, given the

large scale of the Traditional Community Solar category, challenges exist related to the ongoing

verification of the subscriber type and level of that subscriber type within the project. The Agency

has not found a clear path forward that would incorporate these types of commitments and not create

immense administrative burden as the community solar market continues to grow.

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See Docket No. 22-0231, Final Order dated July 14, 2022 at 59.

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“Affiliated” means, with respect to any entity, any other entity that, directly, or indirectly through one or more intermediaries, controls,

is controlled by, or is under common control with each other or a third entity. “Control” means the possession, directly or indirectly, of the

power to direct the management and policies of an entity, whether through the ownership of voting securities, by contract, or otherwise.

Affiliates may not have shared sales or revenue-sharing arrangements, or common debt and equity financing arrangements.

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In approving the Plan, the Commission indicated that “a developer cap, which will also help ensure a fair ranking of the waitlist, is

appropriate” but may not be “described in sufficient detail by the parties.” Docket No. 22-0231, Final Order dated July 14, 2022 at 59.

Illinois Power Agency 2022 Long-Term Plan (Final) August 23, 2022

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7.4.4. Public Schools

The Public Schools category includes Small and Large Distributed Generation projects as well as

community solar projects that serve a public school in Illinois.

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The Public Schools category will

generally comprise at least 15% of the ABP capacity. Public Schools projects will also feature 20-year

REC delivery contracts that pay for RECs over time as they are delivered, rather than the front-loaded

payment schedule previously used under the ABP.

Section 1-75(c)(1)(K)(iv) of the IPA Act restricts the eligibility of projects under the Public Schools

category to those that are installed “at” a public school. In accordance with the Commission’s Final

Order approving this Plan, community solar projects developed on land adjacent to a public school

or on school district-owned land are eligible to participate in this category.

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For community solar projects participating in the Public Schools category, the public school at which

the project is sited (or the school district within which the project host is located) must be an anchor

subscriber to the community solar project. As such, the public school or district must subscribe to a

minimum of 10% of the project’s capacity and, by law, cannot exceed 40% of the project’s capacity.

The Agency recognizes that it may be difficult for a school district or public school to predict the levels

of student enrollment – and thereby, energy usage – for the next 20 years. The Agency will allow

flexibility around the ability of an anchor tenant of a Public School category community solar project

to transfer the subscription to another public school or school district and adjust the subscription

size (within the 10-40% range) as needed. In order to ensure that the benefits of the Public Schools

category return to the schools that host these community solar projects, the Agency will require that

the hosting public school (or the district within which the hosting school is located) request a waiver

from the requirements as necessary during the subscription term. The Agency will develop the

waiver process through solicitation of stakeholder feedback and publish the process in the Program

Guidebook.

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For this category, public schools are defined as any school operated by the authority of the Illinois

School Code.

327

Public school projects located within Environmental Justice Communities or located

on schools that are categorized as a Tier 1 or Tier 2 school based on the latest annual Evidence-Based

Funding Distribution process by the Illinois State Board of Education shall be given priority in the

allocation process.

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To achieve the desired prioritization, 70% of capacity will be allocated to schools categorized as Tier

1, Tier 2, and schools located within Environmental Justice Communities, and 30% will be allocated

to Tier 3 and Tier 4 schools not located within Environmental Justice Communities. Tiers will be

determined using the prior year results of the annual Evidence-Based Funding Distribution process

conducted by the Illinois State Board of Education.

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Capacity will be further allocated by size within

these two groups of school types. 25% of each allocation will go to projects less than or equal to 250

324

For the December 14, 2021 block opening of capacity for Public Schools, only DG applications were accepted.

325

See Docket No. 22-0231, Final Order dated July 14, 2022 at 62. The Agency understands that the Commission’s finding that ”school

districts only exist if there is a school, and as long as the project is located on school district land, then the project is in effect ’installed at’

a public school“ would allow a distributed generation project to be installed at/on a school district building as well as at/on a public school.

326

See id.

327

See: 105 ILCS 5.

328

Illinois State Board of Education Evidence-Based Funding Distribution process: https://www.isbe.net/Pages/ebfdistribution.aspx

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Details can be found at Evidence-Based Funding Distribution Calculation (isbe.net) and Environmental Justice Community Search Map

(arcgis.com)

Illinois Power Agency 2022 Long-Term Plan (Final) August 23, 2022

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kW, 50% to projects greater than 250 kW and less than or equal to 1 MW, and 25% to projects greater

than 1 MW AC in size.

For each delivery year, if any of the above allocations are not filled within 180 days, projects located

at a public school will be accepted on a first come, first serve basis regardless of Tier, Environmental

Justice Community location, or project size.

In order to ensure a smooth transition to new requirements in the market, there will be a one-year

grace period wherein public school projects will be permitted to participate in Illinois Solar for All’s

Non-Profit and Public Facility sub-program.

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More information on this grace period can be found in

Chapter 8. Public schools projects that have a pending application in the ILSFA program may not

submit an application to the Adjustable Block Program. Application and subsequent rejection of said

application to either program does not prohibit an Approved Vendor from applying to the other

program after rejection, but rather an Approved Vendor may not have an active application for the

same project in both programs simultaneously.

7.4.5. Community-Driven Community Solar

The Community-Driven Community Solar (“CDCS”) category includes community solar projects up

to 5 MW that meet the criteria to be classified as community-driven. The CDCS category will comprise

at least 5% of the ABP generally and these projects are intended to provide a more direct and tangible

connection and benefits to the communities in which they operate.

Each delivery year, the Agency will have a 90-day period for projects to be submitted prior to any

project selection. After the close of that 90-day period, the Agency will review projects submitted and

score them according to the project selection process described below. The Agency will endeavor to

complete the review, scoring, and selection process within 90 days. Projects will be selected in order

from projects with the highest score to projects with the lowest score based on the below scoring

mechanism until the capacity for the Community-Driven Community Solar block is filled.

Section 1-75(c)(1)(K)(v) of the IPA Act, as amended by Public Act 102-0662, provides that the Agency

shall develop selection criteria for projects participating in this category. Primary selection criteria

include:

• Community ownership or community wealth-building through having a minimum of 50% of

the ownership of the project held by community residents or non-profit organizations which

directly serve the community where the project is located. This would include having

members of the community being able to participate in decisions regarding the governance,

operation, maintenance, and upgrades of and to the project; and members of that community

benefiting from the project through subscriptions to the project.

• Additional direct and indirect community benefits, beyond project participation as a

subscriber, including, but not limited to, economic, environmental, social, cultural, and

physical benefits. The application must quantify the value of these benefits and they must

represent at least 20% of the REC contract value.

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In approving the Plan, the Commission agreed with this proposed limitation on public school participation in the Illinois Solar for All

Program, but also determined that “if that category is unable to meet demand from public schools and the ILSFA Non-Profit Public Facilities

sub-program is undersubscribed, the IPA should revisit the issue in its next LTRRPP.” Docket No. 22-0231, Final Order dated July 14, 2022

at 121.

Illinois Power Agency 2022 Long-Term Plan (Final) August 23, 2022

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o Direct benefits can include, but are not limited to, financial benefits for the owner(s)

and subscribers, such as bill savings, revenues from project ownership, tax credits,

and the financial value of the project, as well as job creation, direct income, and

increased economic activity in the defined geographic community.

o Indirect benefits can include, but are not limited to, demonstration of environmental,

educational, and cultural benefits.

• Meaningful involvement in project organization and development by community members,

nonprofit organizations, or public entities located in or serving the community.

o Meaningful involvement as used herein can mean, but is not limited to, a process that

consists of public input, participation and engagement in the program design process,

including workshops, webinars, and public comment periods all of which afford

stakeholders (those that have an interest or stake in an issue, such as individuals,

interest groups, and communities) the opportunity to influence decisions that impact

their community.

• Engagement in project operations and management by nonprofit organizations, public

entities, or community members.

o Engagement as used herein can mean, but is not limited to, continuous community

participation and consultation as projects are built, operated, and maintained in a

way that affords opportunities for the community to weigh in on and make decisions

regarding the project.

• Whether a project is developed in response to a site-specific RFP developed by community

members, or a nonprofit organization or public entity located in or serving the community.

Sufficient demonstration of any of the individual primary selection criteria will be worth up to four

(4) points each in the scoring system.

Demonstration of any of these primary selection criteria should be accomplished through a detailed

written narrative description that includes firm commitments and evidence as to how any benefits,

resources, and wealth-building will flow to the community that will host the Community-Driven

Community Solar project. Additionally, any community engagement activities and planned

community ownership should be documented in a detailed way in this narrative.

The Agency requested feedback on how to define terms used in the primary selection criteria in the

request for comments put forth prior to the release of the draft 2022 Long-Term Plan and

additionally requested feedback on these terms in the draft 2022 Long-Term Plan itself, but did not

receive substantive feedback to help focus these terms and/or concepts.

Section 1-75(c)(1)(K)(v) of the IPA Act, as amended by Public Act 102-0662, also detailed the

following additional selection criteria to prioritize CDCS projects that:

• are developed in collaboration with or to provide complementary opportunities for the Clean

Jobs Workforce Network Program, the Illinois Climate Works Preapprenticeship Program,

the Returning Residents Clean Jobs Training Program, the Clean Energy Contractor Incubator

Program, or the Clean Energy Primes Contractor Accelerator Program

o Complementary opportunities as used herein can mean, but is not limited to: utilizing

graduates of job training programs in project development; hiring job training

graduates permanently for future projects, not just the applicant project; an

Illinois Power Agency 2022 Long-Term Plan (Final) August 23, 2022

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expansion of the goals of the job training programs to include ‘business training,’ on

how to develop a project, get financing, recruit customers, etc.

• increase the diversity of locations of community solar projects in Illinois, including by

locating in urban areas and population centers

• are located in Equity Investment Eligible Communities

• are not greenfield projects

• serve only local subscribers

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• have a nameplate capacity that does not exceed 500 kW

• are developed by an equity eligible contractor; or

• otherwise meaningfully advance the goals of providing more direct and tangible connection

and benefits to the communities which they serve or in which they operate and increasing

the variety of community solar locations, models, and options in Illinois.

Sufficient demonstration of any of the individual secondary selection criteria will be worth up to two

(2) points each in the scoring system.

Demonstration of any of these additional selection criteria should be accomplished through a

detailed written narrative description separate from the narrative provided for the primary selection

criteria outlined directly above. Evidence of any/all additional selection criteria that are applicable

to the applicant’s Community-Driven Community Solar project should be outlined as

comprehensively as possible in this narrative.

Selection of projects will be based on total points awarded up to the category’s block size. To avoid

prioritization of a project that does not have community-based support, the Agency will require a

minimum score of six (6) points for project category qualification. Random selection would only be

utilized as a tie-breaker for equally scored projects to fill available capacity, if any; however, should

the capacity available be so small so as to only accommodate one or more projects below a certain

size, then the Agency might only consider those projects small enough to not exceed that remaining

capacity.

After project selection for any given delivery year is complete, projects that were not selected and

that have a minimum score of at least ten points will be placed on a waitlist for the following delivery

year. The increase in the minimum score requirement is to ensure the quality of projects carried over

from year to year.

The Agency recognizes that as Community-Driven Community Solar is a new type of community solar

for Illinois and introduces a variety of new ways of evaluating project types, the first few years of the

category should be viewed as an opportunity to learn how communities choose to organize and

develop projects. Only after several rounds of project selection will it be possible to evaluate if the

approach the Agency is proposing for project selection is successful in creating a diversity of

community solar projects and organizational structures in Illinois. Therefore, the Agency expects that

in the next update of the Long-Term Plan (to be initiated in the summer of 2023 for implementation

for the 2024 delivery year) this approach may be substantially revised, and the Agency will seek

stakeholder feedback as part of that revision process.

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Local subscribers are subscribers in the same county as the project, or if that project’s county population is below 50,000, then also in

adjacent counties.

Illinois Power Agency 2022 Long-Term Plan (Final) August 23, 2022

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7.4.6. Equity Eligible Contractor (“EEC”)

The EEC category includes Distributed Generation projects as well as community solar projects that

have been submitted to the Program by Equity Eligible Contractor Approved Vendors per the

guidelines specified in Section 7.7.3.

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At least 10% of the capacity of the ABP shall come from

projects submitted by applicants that are EEC certified. EEC certified Approved Vendors may also

submit projects into other program categories and are not limited to the EEC category. To give the

market for EEC projects time to develop, for the 2022-2023 and the 2023-2024 delivery years, the

Agency does not propose increasing the portion the Adjustable Block Program allocated to EEC

projects above the 10% level, but expects that in the next Long-Term Plan which will cover the

subsequent two delivery years, the Agency will begin to increase that percentage with the goal of

reaching 40% by the 2030 delivery year.

At this time, the Agency is not proposing specific sub-categories within the EEC category for specific

project types as it believes that it needs to give time for this sector to develop and does not want to

prematurely limit project applications. Furthermore, for this 2022 Long-Term Plan the Agency is not

proposing different REC prices for EEC projects than the comparable DG or Community Solar projects

(which would recognize variations in project size and geographic location), rather the Agency is

proposing that the key value of participation in the EEC category is the opportunity for the advance

of capital to overcome financing barriers.

The IPA will work to reduce and eliminate barriers to participation in all of its programs to the fullest

extent possible. The Agency will regularly solicit feedback from stakeholders and EEC program

participants on the subject of eliminating or reducing barriers to participation in IPA programs,

beginning with a stakeholder feedback process to solicit input on how to increase participation by

EECs in the Program. In approving this Plan, the Commission noted with approval the IPA’s

“commitment to continue to monitor this ABP category and to work with stakeholders to identity

barriers and streamline the process.”

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7.4.6.1. Equity Eligible Contractor Advance of Capital

Section 1-75(c)(1)(K)(iv) of the IPA Act specifies that,

The Agency shall propose a payment structure for contracts executed pursuant to this

paragraph under which, upon a demonstration of qualification or need, applicant firms

are advanced capital disbursed after contract execution but before the contracted

project's energization. The amount or percentage of capital advanced prior to project

energization shall be sufficient to both cover any increase in development costs resulting

from prevailing wage requirements or project-labor agreements and designed to

overcome barriers in access to capital faced by equity eligible contractors.

Up to 50% of contract value may be advanced to an EEC-certified Approved Vendor under this

provision.

A particular challenge that the Agency has identified with the advance of capital is the risk of projects

not being completed, despite the advance of capital. Therefore, the Agency proposes the following

risk mitigation requirements. First, to be eligible for an advance of capital, an EEC will need to include

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For the initial block of capacity for Equity Eligible Contractors, only distributed generation applications were accepted.

333

Docket No. 22-0231, Final Order dated July 14, 2022 at 71.

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the request for the advance of capital in the Part I application of the project, along with a short

narrative description of the need being addressed, and what key project development milestone will

trigger the disbursement. The narrative description should include a breakdown of costs that the

advance will cover and may be submitted on a confidential basis. Once a project has been Part I

verified and the contract or product order approved by the Commission, the EEC will then submit

verification of achievement of the specified milestones to the Agency for review and approval. The

EEC will then invoice the utility for the advancement following the regular invoicing process and the

utilities will process this invoice following the same, with the payments made by the contracting

utility on the regular monthly invoicing cycle.

The Agency will use the information gained in first two years of this option’s availability to refine

how advances of capital will be addressed in future Long-Term Plans. For an EEC who benefits from

an advance of capital, but projects are not completed and the EEC does not return the advanced funds,

that EEC will face disciplinary action and will not be eligible to submit additional project applications

to the Adjustable Block Program until that debt is paid.

As outlined Section 1-75(c)(1)(K)(vi) of the IPA Act, once the advance of capital is approved by the

Agency, the capital will be disbursed with the following limitation on payments made upon and after

that project’s energization:

Capital advanced prior to energization shall serve to reduce the ratable payments made

after energization under items (ii) and (iii) of subparagraph (L) or payments made for

each renewable energy credit delivery under item (iv) of subparagraph (L).

7.4.6.2. EEC Eligibility

Section 7.7.3 describes in detail the requirements for an Approved Vendor to become certified as an

Equity Eligible Contractor. Eligibility for this category is limited to Approved Vendors who qualify as

an EEC. Equity Eligible Contractor Approved Vendors may choose to work with Designees or on their

own, and those Designees may or may not also be EEC qualified. However, Approved Vendors that

are not EECs but partner with a Designee that qualifies an Equity Eligible Contractor are ineligible to

submit projects.

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While the Agency understands that there may be interest in models where a Designee is an Equity

Eligible Contractor, but they operate under an Approved Vendor who is not an Equity Eligible

Contractor, the Agency cannot reconcile that with Section 1-75(c)(1)(K)(iv) of the IPA Act’s

requirement that this category is for projects “from applicants that are equity eligible contractors.”

Applicants in the Adjustable Block Program are Approved Vendors, as they are ultimately the entity

that holds the REC delivery contract with a utility. The concept of a Designee was developed by the

Agency to ensure that program requirements and accountability flow through to the entities involved

in sales, marketing, subscriber acquisition, construction, and installation. It does not change who is

the applicant into the program, as Designees are not permitted to submit project applications to the

program. The Agency also hopes that this approach will minimize the risk that entities that are not

Equity Eligible Contractors inappropriately benefit from this category.

Projects that are developed by Approved Vendors certified as Equity Eligible Contractors and receive

a REC contract through the EEC block of capacity may not assign those projects to an Approved

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Docket No. 22-0231, Final Order dated July 14, 2022 at 70-71.

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Vendor that is not also a certified Equity Eligible Contractor for six years after the Part II verification

date of the project. After six years from the Part II verification date has passed, this moratorium on

assigning EEC projects to Approved Vendors that are not certified as an EEC is lifted.

7.5. REC Pricing Model

7.5.1. Background

For the Initial Plan, the IPA adopted and modified the National Renewable Energy Laboratory’s Cost

of Renewable Energy Spreadsheet Tool (“CREST”) to develop a model for calculating REC prices.

CREST is an economic cash flow model that estimates the cost of energy in terms of cents per kilowatt

hour associated with specific input assumptions regarding technology type, location, system capital

and operating costs, expected production, project useful life, and various project financing variables.

The Agency’s REC pricing model established initial pricing for each block, with prices then declining

4% for each subsequent block.

In its Order approving the First Revised Plan, the Commission stated that “REC prices must be lower,”

although it neglected to adopt any specific proposal for how to lower such prices (and no

methodology for lowering prices was introduced into the record).

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Instead, the Commission

required that “workshops should be held and stakeholder input considered” regarding how REC

prices could be lowered, with a need to be mindful that, going forward, “the IPA must recognize

market signals rather than solely relying on its cost modeling approach” in determining REC prices.

The Agency solicited stakeholder feedback on REC pricing in November 2020

336

and further feedback

after a workshop in July 2021.

337

Generally, most stakeholders favored maintaining the 4% decline

between blocks, but there was some concern that community solar REC prices remain too high.

Alternatively, stated concerns that would argue against a decline in REC prices included the decrease

in the Federal Investment Tax Credit from 30% to 26%, a decline in energy prices (which would

reduce net metering credit value), higher than expected interconnection costs (particularly for

community solar), and ongoing uncertainty about the future value of smart inverter rebates.

338

When the Agency released the now withdrawn draft Second Revised Plan, it offered an example of

what REC prices would look like with a continuation of the 4% decline between blocks as well as REC

price modeling based upon updating certain inputs to the original pricing model approved in the

Initial Plan.

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With the enactment of Public Act 102-0662, two key changes were made that impact

the Agency’s REC price modeling. First, three new categories of projects were introduced (Public

Schools projects, Community-Driven Community Solar projects, and Equity Eligible Contractors

projects), with one of those new categories, Public Schools projects as well as the existing category

for Traditional Community Solar, now featuring 20-year contracts rather than 15-year contracts. The

second change is that rather than blocks opening as the previous block close, blocks are now set on

an annual basis to correlate with energy delivery years (June 1 to May 31). As a result, the concept of

335

See Docket No. 19-0995, Final Order dated Feb. 18, 2020 at 46.

336

See: https://illinoisabp.com/stakeholder-feedback-rec-pricing-feedback-request/.

337

See: https://ipa.illinois.gov/renewable-resources/workshop-information.html.

338

The Agency notes that since the time that feedback was received, energy prices rose significantly in the second half of 2021.

339

A description of the updated inputs is contained in Section 6.3 of the withdrawn draft Second Revised Plan. See:

https://ipa.illinois.gov/content/dam/soi/en/web/ipa/documents/draftsecondrevisedplan16august.pdf and additional information is

contained in Appendices D and E at: https://ipa.illinois.gov/energy-procurement/second-revised-ltrrpp-appendices.html.

Illinois Power Agency 2022 Long-Term Plan (Final) August 23, 2022

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4% declines between blocks no longer fits the program design and the Agency instead proposes to

conduct an annual update to REC prices, as described below in Section 7.5.7.

For the 2022 Long-Term Plan as initially filed with the Commission, the Agency updated the modeling

conducted for the withdrawn draft Second Revised Plan in several ways and used that updated

modeling as the basis for the REC prices contained in this Plan. First, it updated the cost of installation

to account for an estimate of incremental impact of prevailing wage requirements where applicable.

This update follows the price adjustment the Agency used for REC prices for the non-waitlisted Large

DG blocks that opened in December 2021 but now applies across a wider set of program categories.

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Second, for those categories now featuring 20-year contracts, the model was adjusted for a larger

quantity of REC deliveries that provide corresponding revenue to the project. Third, for the

community solar categories, rather than having an adder for various levels of small subscribers, given

the new requirement that all projects have at least 50% small subscribers, the previous value the

Agency proposed in the withdrawn Second Revised for the 50% small subscriber adder has been

included in all community solar prices and there is no longer a separate adder for small subscribers.

Each of those changes were approved by the Commission, along with additional modifications

explained further below.

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Perhaps most notably, through the Plan approval process in ICC Docket No. 22-0231, stakeholders

raised objections and made various proposals to further modify the Agency’s REC Pricing Model,

either through structural changes to the model itself or updated inputs. The IPA proposed to engage

an independent expert consultant to complete a thorough review of REC prices prior to the next

update of the Agency’s Long-Term Plan. The independent expert consultant will provide the IPA with

recommendations on how to develop administratively-set REC prices that both efficiently invest

ratepayer funds in renewables and respond annually to changing market conditions. The IPA will

provide transparency around the results of the review and utilize the independent analysis to craft

REC prices for the next Plan. The Commission agreed with this approach and noted that it looks

forward to reviewing the recommendations of the Agency’s independent expert consultant in its

Order approving this Plan.

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The Agency also made a significant change to Appendix E which contains the spreadsheets used to

calculate REC prices. For the withdrawn draft Second Revised Plan, each category and group was

presented in a separate spreadsheet, with a total of 16 separate spreadsheets for REC prices for the

Adjustable Block Program and the Illinois Solar for All Program. The Agency has now consolidated

the REC pricing model into a single spreadsheet which automatically recalculates REC prices through

drop-down menu selections. This new spreadsheet also groups assumptions used in modeling into

consolidated tables which will allow stakeholders to compare differences between categories in a

single view. While the change in the spreadsheet design does not impact the resulting REC prices, it

is intended to allow for easier review of modeling assumptions by stakeholders, and also to allow

stakeholders to use the modeling tool to test how changes in assumptions would impact REC prices.

340

See: https://illinoisabp.com/wp-content/uploads/2021/10/Large-DG-REC-Price-Feedback-14-Oct-2021-Final.pdf.

341

See Docket No. 22-0231, Final Order dated July 14, 2022, at 93-95.

342

See Docket No. 22-0231, Final Order dated July 14, 2022 at 94.

Illinois Power Agency 2022 Long-Term Plan (Final) August 23, 2022

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7.5.2. Modeling Update

As part of the development of the withdrawn draft Second Revised Plan the Agency undertook the

exercise of updating the REC Pricing Model. Changes from that update, along with modifications

approved by the Commission in Docket No. 22-0231, are now included in this 2022 Long-Term Plan.

Key changes include:

• Adjustment of the Federal Investment Tax Credit to 22%

• Updated project cost information based on the U.S. Solar Photovoltaic System and

Energy Storage Cost Benchmark: Q1 2020 Report from NREL.

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This also includes

reducing the impact of tariffs on imported modules to the current level. Community

Solar projects now reflect costs for tracking rather than fixed-mount systems. Finally,

development costs and fees for 5 MW systems were extrapolated from 2 MW system

data to create inputs for the larger system sizes.

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• Updated AC/DC ratios based on an analysis of actual project applications received

and energized and capacity factors based on PVWatts analyses of energized projects.

However, due to the lack of Community Solar projects below 500 kW, for smaller

community solar size categories, DG project data was utilized. Capital costs have also

been adjusted to reflect these AC/DC ratios. Update of net metering credit values and

energy values to current values, including the value capacity for projects over 25 kW,

and applicable tariffs. Net metering annual increases were also adjusted from 2% to

1%.

• An increased in the length of time for construction.

• For systems up to 25 kW, interconnection costs are now set at $200 to reflect the

changes made to Section 16-107.5(h-5)(3) of the Public Utilities Act regarding Level

1 interconnection costs.

• An update of Community Solar interconnection costs based on a survey of Approved

Vendors with actual interconnection costs for energized Community Solar projects.

• Adjustments to account for the cost of prevailing wage requirements.

• Adjustments to reflect the length of the REC delivery contract, and Public Schools

projects modeled using an alternative cash flow model as described in Appendix D.

• The cost community solar small subscriber management is now included in the

community solar REC prices rather than reflected as an adder based on subscription

levels.

• Adjustment to the assumed subscriber savings for the Non-Profit and Public Facilities

subprogram of Illinois Solar for All.

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• Adjustment to the bonus depreciation value to 80% to reflect the phase out of bonus

depreciation by 2026.

346

343

See: https://www.nrel.gov/docs/fy21osti/77324.pdf. This report was released in January 2021 and is the most recent data available

from NREL.

344

See Docket No. 22-0231, Final Order dated July 14, 2022, at 95.

345

See Docket No. 22-0231, Final Order dated July 14, 2022 at 95.

346

See Docket No. 22-0231, Final Order dated July 14, 2022 at 93.

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• Adoption of five-year historical average price inputs for capacity charges for non-

residential modeled systems and five-year historical, seasonally-weighted averaged

purchased electricity charges for systems modeled on the 10 kW system size.

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Examples of inputs that were not updated include financing structure (e.g., debt ratios and project

financing interest rates), internal rates of return, and O&M costs. These inputs are all listed in detail

in Appendices D and E.

A description of the REC Pricing Model and inputs used is contained in Appendix D and the REC

Pricing Spreadsheet is provided in Appendix E, both of which have been updated consistent with the

Commission’s Final Order approving this Plan. The Agency has updated the REC Pricing Model and

inputs in accordance with the Commission’s modifications under the Final Order in Docket No. 22-

0231. The REC Pricing Model and final prices for the 2022-2023 delivery year were published on

August 1, 2022, in accordance with the IPA’s commitment made in the proceeding.

348

347

See Docket No. 22-0231, Final Order dated July 14, 2023, at 95.

348

See Docket No. 22-0231, Final Order dated July 14, 2022 at 42.

Illinois Power Agency 2022 Long-Term Plan (Final) August 23, 2022

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Table 7-5: Proposed ABP REC Prices ($/REC) for Delivery Year 2022-23

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Block Category/Size

Group A

(Ameren Illinois,

MidAmerican, Mt. Carmel,

Rural Electric Cooperatives,

and Municipal Utilities

located in MISO)

Group B

(ComEd, and Rural

Electric Cooperatives

and Municipal Utilities

located in PJM)

Small DG

≤10 kW

$78.51

$82.28

>10 - 25 kW

$66.39

$71.89

Large DG

>25 - 100 kW

$57.94

$62.23

>100 - 200 kW

$58.85

$59.02

>200 - 500 kW

$52.35

$53.11

>500 - 2,000 kW

$50.42

$47.63

>2,000 kW – 5,000 kW

$40.90

$33.31

Public

Schools

(20 years)

≤ 25 kW

$74.95

$81.16

>25 - 100 kW

$65.57

$70.42

>100 - 200 kW

$66.40

$66.59

>200 - 500 kW

$58.94

$59.81

>500 - 2,000 kW

$56.73

$53.59

>2,000 kW – 5,000 kW

$45.72

$37.23

Traditional

Community

Solar

(20 years)

≤ 25 kW

$56.23

$61.54

>25 - 100 kW

$59.19

$64.39

>100 - 200 kW

$60.85

$65.23

>200 - 500 kW

$57.22

$62.09

>500 - 2,000 kW

$51.32

$55.50

>2,000 kW – 5,000 kW

$45.50

$47.78

Community-

Driven

Community

Solar

≤ 25 kW

$71.60

$78.27

>25 - 100 kW

$75.34

$82.16

>100 - 200 kW

$77.27

$83.42

>200 - 500 kW

$72.47

$79.19

>500 - 2,000 kW

$64.76

$70.12

>2,000 kW – 5,000 kW

$56.85

$59.44

Note that as discussed in Section 7.4.6, for this 2022 Long-Term Plan the Agency is not proposing

separate prices for projects in Equity Eligible Contractor category. Those projects will instead feature

the opportunity for the advance of capital. Equity Eligible Contractor projects would use the

applicable REC price for distributed generation or community-driven community solar (as they

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These prices are consistent with those published by the Agency on August 1, 2022.

Illinois Power Agency 2022 Long-Term Plan (Final) August 23, 2022

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would be under 15-year contracts). In addition, a Public Schools project that is community solar

would receive the Traditional Community Solar REC price applicable to the project’s size.

7.5.3. Adjustments

Adjustments are intended to adjust the base REC price to meet specific additional purposes. These

include adjusting for system size, and for adjusting for the additional costs of small subscribers for

community solar projects.

While the Act seeks to encourage projects “in diverse locations and are not concentrated in a few

regional areas,”

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at this time the Agency is not proposing any specific geographic REC price adders

for distributed generation projects. The Agency believes that the split of the blocks between utility

service territories adequately addresses program-wide/statewide geographic diversity, and DG

project applications to date indicate that projects are well distributed across the state.

The Agency observes that while projects are spread across the state at a high level, community solar

projects are predominantly located in rural areas that are not likely to be close to subscribers. The

Agency expects that the creation of the new category of Community-Driven Community Solar will

address this issue and result in community solar projects in more suburban and urban areas that will

increase the diversity of community solar project locations.

7.5.4. Size Category Adjustments

Prior to the enactment of Public Act 102-0662, Small DG projects were defined as projects up to and

including 10 kW in size. That size has been increased to up to and including 25 kW. The Agency

proposes to now have two price levels within the Small DG category, one for projects up to and

including 10 kW and one for projects over 10 kW up to and including 25 kW. The price for projects

up to and including 10 kW does not include an adjustment the incremental cost of prevailing wage

requirements. Most residential projects are under 10 kW in size (and similarly most projects under

10 kW are residential), so the use of two levels provides a proxy for that adjustment.

For all other categories, the Agency proposes to have the smallest size category for projects up to and

including 25 kW, and then subsequent category sizes for projects 25 kW up to and including 100 kW,

over 100 kW up to and including 200 kW, over 200 kW up to and including 500 kW, and over 500 kW

up to and including 2 MW, and over 2 MW up to and including 5 MW, with adjustments to REC prices

reflecting modeled development costs by size category.

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7.5.5. Co-location of Distributed Generation Systems

For purposes of Adjustable Block Program categories and applicable REC prices, the total capacity of

distributed generation systems energized after June 1, 2017 on a single parcel that participate in the

Adjustable Block Program are considered a single system.

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(For example, three 100 kW systems on

a single parcel will be considered a 300 kW system.) If a system on a single parcel is subsequently

expanded, the Agency reserves the right to revise the incentive amounts paid for the subsequent

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20 ILCS 3855/1-75(c)(1)(K).

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As per the Commission’s Order in Docket No. 22-0231, the IPA will explore additional subcategories across Large DG projects for its

next Long-Term Plan. See Docket No. 22-0231, Final Order dated July 14, 2022 at 96.

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Any system developed under this program would require a separate GATS or M-RETS ID from any system developed through a different

program (e.g., the Supplemental Photovoltaic Procurement or the Utility DG procurements) or without programmatic support. This would

allow for a clear demarcation between systems and their associated RECs.

Illinois Power Agency 2022 Long-Term Plan (Final) August 23, 2022

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system(s), and to set the incentives based on the total expanded system size rather than just treat the

expansion as a separate system. For the purpose of establishing a revised incentive level under these

circumstances, the systems’ location would be considered at the parcel level. Exceptions will be made

if it can be demonstrated that two projects on one parcel have separate, non-affiliated owners and

serve to offset the load of separate, non-affiliated entities on a parcel.

In rural areas of Illinois, it is not uncommon for a parcel to have buildings (and thus load to be offset

by distributed generation) that serve separate residential and agricultural uses. The Agency will

evaluate requests to consider those uses separately for the application of this standard.

The Agency’s co-location determinations only apply to distributed generation projects participating

in the Adjustable Block Program and not projects installed outside of the Program (e.g., through

previously conducted Agency procurements, receiving DCEO rebates, or developed without

incentives). It also does not apply to the co-location of distributed generation and community solar

projects. Co-location of community solar projects is discussed in Section 7.9.4.

7.5.6. Community Solar

Community solar projects face additional costs and feature reduced eligibility for direct energy-

related revenues than distributed generation systems. On the revenue side, subscribers to such

projects are eligible only for energy-only net metering, while on the cost side, there is the cost of

acquiring, maintaining, and managing subscribers. The prices for community solar RECs compared

to distributed generation projects as shown above in Table 7-5 reflect those differences.

In the Initial Long-Term Plan, the Agency included adders for community solar projects with higher

levels of small subscribers (residential and small commercial customers with subscriptions below 25

kW). For the Revised Plan, the Agency eliminated the Initial Plan’s highest adder for over 75% small

subscribers and had the largest adder available for projects featuring over 50% small subscribers.

This left the adders ranging from $11.17/$10.88, for Groups A and B respectively for projects with

over 25% small subscribers, and less than 50% to $22.34/$21.77 respectively, for projects with 50%

or greater small subscribers.

The Agency continued to have concerns that these adders may have been too high. These adders were

developed using an analysis of community solar subscription costs contained in the Initial Plan. The

Agency notes that a 2018 GTM Research report

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contained estimates of subscriber acquisition costs

that ranged from $0.06 to $0.25 per Watt and ongoing subscriber management (including billing and

replacing subscribers) of $0.12 to $0.35 per Watt. The low end of the combined costs from those

estimates would be $0.18 per Watt and the high end $0.60 per Watt. Translating those costs to the

REC output over 15 years of a typical 2 MW community solar project (with a 22% AC capacity factor),

those ranges would imply additional subscriber-related costs of $6.85 to $22.83 per REC, which

indicates that those small subscriber adders were too high, especially if the prior adder for systems

with greater than 75% small subscriber participation had been maintained.

353

The Vision for U.S. Community Solar: A Roadmap to 2030. GTM Research, July 2018 (https://votesolar.org/wp-

content/uploads/2021/05/EXEC_SUMM___The_Vision_for_US_Community_Solar_072518.pdf).

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Another data point suggesting a lower adder comes from Minnesota, which utilized the equivalent of

$15/REC for a two-year pilot for projects that energized in 2019 or 2020 (and is currently undergoing

review with stakeholders advocating for its extension).

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For the withdrawn draft Second Revised Plan, the Agency sought stakeholder feedback on if small

subscriber adders should be reduced. The shift to online marketing and enrollment is likely an

additional cost savings for community solar providers that may not have been reflected in the

original current adder. The Agency suggested starting with the midpoint of the range of costs

reported by GTRM Research, or $14.82/REC for 50% or over small subscriber levels (and a lower

adder for projects in the 25-50% small subscriber range). This approach produced adders very

similar to the current Minnesota adder.

Public Act 102-0662 now requires that community solar projects have a minimum of 50% small

subscribers. This renders the need to have an adder for different levels of small subscriber levels

unnecessary, as there would no longer be the possibility of a project having between 25 and 50%

small subscribers. As the Agency had already proposed basing the highest level adder as being at the

50% of higher small subscriber level, the amount that was previously broken out as an adder is now

proposed to be included in all community solar REC prices. The Agency proposes maintaining its

suggestion from the withdrawn draft Second Revised Plan of having that adjustment set at

$14.82/REC. The Agency further notes that changes to community solar net metering contained in

Section 16-107.5(l)(3) of the Public Utilities Act will allow Ameren and ComEd to offer consolidated

billing for community solar projects, which is a potential additional decrease in the cost of managing

small subscriber subscriptions. In approving this approach, the Commission noted that the REC price

for community solar is clearly sufficient to support participation in the program based upon the over-

subscription of the Traditional Community Solar category.

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7.5.7. Updating of REC Prices

Prior to the enactment of Public Act 102-0662, there were two ways REC prices could change. The

first was when a block of capacity closed, the next block would open at a new, lower price and the

Agency set that price decline at 4% between blocks. The second way that REC prices could change

was a provision of Section 1-75(c)(1)(M) of the IPA Act that allowed the Agency to change prices (and

other program elements) by up to 25% without seeking Commission approval, but with stakeholder

input. During the period of 2019 through 2021, the Agency did not make any such REC price

adjustments.

Public Act 102-0662 now sets blocks to be based on capacity for a given energy delivery year. As a

result, the approach of having REC prices decline by 4% between blocks is now less appropriate.

Under the prior model the rate of progression between blocks was determined by market activity.

More applications received by the program meant faster closing of blocks, and prices changing more

often; thus fewer applications received by the program, and prices would be maintained for a longer

time. As the transition between blocks will now occur on a known schedule, occurring every June 1,

the Agency proposes that rather than having a pre-determined price change between blocks, that

instead the Agency conduct an annual refresh of the REC Pricing Model described above. This will

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See Appendix C for additional information on the Minnesota adder.

355

See Docket No. 22-0231, Final Order dated July 14, 2022 at 97.

Illinois Power Agency 2022 Long-Term Plan (Final) August 23, 2022

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include refreshing inputs from known sources and seeking stakeholder feedback on preliminary

prices.

For the 2022-2023 delivery year, REC prices will be as approved by the Commission through the

Commission’s approval the 2022 Long-Term Plan. For the 2023-2024 delivery year, the Agency

proposes to begin the updating of the REC pricing model in January of 2023 with the release of a draft

new set of REC prices for stakeholder feedback. The Agency will consider that feedback and finalize

REC prices by May 1, 2023.

The other mechanism for changing REC prices is Section 1-75(c)(1)(M)’s allowance that “[p]rogram

modifications to any block price that do not deviate from the Commission's approved value by more

than 10% [and] shall take effect immediately and are not subject to Commission review and

approval.” This adjustment level was reduced from 25% to 10% by Public Act 106-0662.

Furthermore, any modifications to prices require stakeholder feedback and advance notification.

There are several reasons why the Agency might consider a mid-year price adjustment, but the IPA

would only do so if it determines that changing circumstances have created a genuine need for an

adjustment. Examples of such circumstances would include changes to federal legislation that impact

the Investment Tax Credit, new tariffs on imported panels and modules, or significant changes to net

metering credits or the smart inverter rebate (however smart inverter rebates will not change prior

to December 2024, which is outside the time period covered by this 2022 Long-Term Plan). If the

Agency becomes aware of a circumstance that would warrant consideration of a mid-year REC price

adjustment, it will conduct modeling of REC price changes and conduct a stakeholder feedback

process before making any changes.

Following the Commission’s approval of this Plan, federal legislation was enacted on August 16, 2022,

which includes extensions of and enhancements to the structure of the Investment Tax Credit, which

would have a significant impact on the REC Pricing model. However, any such changes to REC prices

based upon the enactment of the federal Inflation Recovery Act will require time to evaluate and

adjust; accordingly, the Agency will not incorporate such changes into REC Prices until the 2023-

2024 delivery year.

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Finally, as discussed above, the Agency will retain an independent expert consultant to conduct a re-

evaluation of the REC Pricing Model prior to the release of the 2024 Long-Term Plan.

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The

recommendations provided by the expert consultant will be utilized in the development of the REC

Prices for future years and governed by future Plans. At the earliest, the IPA believes that the

recommendations may be used to inform the adjustments to REC prices for the 2024-2025 and 2025-

2026 delivery years.

7.6. Prevailing Wage

As outlined in Section 1-75(c)(1)(Q) of the IPA Act, most Adjustable Block Program project proposals

must comply with Illinois Prevailing Wage Act requirements. Prevailing wage is a minimum

compensation level by county set by the Illinois Department of Labor for construction activities

related to public works. Section 1-75(c)(1)(Q) of the IPA Act (20 ILCS 3855) now requires that

individuals engaged in the construction of applicable projects submitted to the Program are paid the

356

The Agency provided rationale for this decision here: https://illinoisabp.com/wp-content/uploads/2022/08/August-19-2022-

announcement-final-for-publication.pdf

357

See Docket No. 22-0231, Final Order dated July 14, 2022, at 94.

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prevailing wage. Additionally, Public Act 102-0673 clarifies that projects receiving incentives under

the Program are “public works” subject to the Prevailing Wage Act—which includes notice

requirements and related provisions as well. For Adjustable Block Program administration, Illinois

law allows only the following types of projects to be considered exempt from prevailing wage

requirements:

• Large Distributed Generation projects (greater than 25 kW AC) that were on a waitlist as of

the program’s reopening on December 14, 2021

• Distributed generation projects (Large or Small) that either serve a single-family or multi-

family residential building, or serve a house of worship and are not greater than 100 kW AC

(aggregated with any co-located projects)

• Distributed generation projects (Large or Small) for which construction can be demonstrated

to have been completed before September 15, 2021, the effective date of Public Act 102-0662.

A project application sized between 10-25 kW for which an application was originally received in the

Large Distributed Generation category (i.e., on or before November 1, 2021 when the ABP application

portal closed to applications in preparation for program reopening on December 14, 2021) will be

considered a waitlisted Large Distributed Generation project for prevailing wage purposes, although

that project will otherwise be reclassified as a Small Distributed Generation project for processing

the project application and that reclassification will be reflected in the REC price and payment terms.

After the enactment of Public Act 102-0673, projects that do not qualify for one of the above

exemptions must comply with all provisions of the Prevailing Wage Act (“PWA”). The Illinois

Department of Labor (“DOL”) oversees the implementation and enforcement of the Prevailing Wage

Act and has multiple resources, such as FAQs, available on its website.

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The Prevailing Wage Act

requires that employees engaged in construction activities related to the project be paid the

prevailing wage of that location, as determined by the DOL annually and updated regularly on its

website. The Approved Vendor, its contractors, and its subcontractors must provide written notice

to all contractors and subcontractors that the PWA applies to the project, including notice and record

keeping requirements; penalties and fines for violations may be imposed on upstream contractors if

they did not provide proper notice to subcontractors. Employees engaged in construction activities

must be given written notice of the applicable prevailing wage rates through posting those rates on

the work site, at a central office, or through direct written communication. Each contractor and

subcontractor under contract for construction activities for the project must submit a Certified

Transcript of Payroll (“CTP”) using the DOL Certified Transcript of Payroll Portal on a monthly basis

throughout construction activities. Templates for the CTP and additional details on what to include

may be found on the DOL website. Approved Vendors must also submit all CTPs from the project to

the Program Administrator.

Part I of the project application for non-exempted projects will require that an Approved Vendor

certify its understanding that prevailing wage requirements apply to that project, and the Part I

verification will include the Program Administrator’s determination regarding applicability of

prevailing wage requirements. In Part II of the project application, the Approved Vendor will be

required to certify to and document compliance with prevailing wage requirements, if applicable.

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Illinois Department of Labor: https://www2.illinois.gov/idol/Pages/default.aspx

Illinois Power Agency 2022 Long-Term Plan (Final) August 23, 2022

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All projects subject to prevailing wage requirements may be subject to auditing by the Program

Administrator to verify compliance. This auditing includes a requirement to admit the Program

Administrator or their representatives to work sites for ongoing projects, access to speak to

employees who are working or have worked on projects, access to requested documentation

demonstrating payment of wages including but not limited to Certified Transcripts of Payroll, and

any other information the Program Administrator deems necessary to confirm compliance with this

requirement. Failure to comply with prevailing wage requirements is considered a violation of

program requirements. While the Agency may refer potential violations of the PWA to the DOL for

further investigation and enforcement, the Agency may also take disciplinary action against any

Approved Vendor or Designee found to have violated the PWA on a facility for which there was a REC

contract under the ABP.

7.7. Approved Vendors

Participation in the Adjustable Block Program takes place through, and is conditional upon, the

Approved Vendor process developed by the Agency and implemented by the Program Administrator.

The Approved Vendor model was originally based upon the experiences the Agency gained through

the development and implementation of the Supplemental Photovoltaic Procurement, as well as

observations of programs in other states. While arguably there could be more flexibility available to

consumers through a program under which any entity may receive a contract, by having Approved

Vendors—i.e., ensuring that any entity receiving a REC delivery contract is registered with and vetted

by the Agency, and has met conditions predicate—the Agency is better able to monitor compliance

with program terms and conditions, ensure the accuracy and quality of information submitted, and

reduce the administrative burden on the contractual counterparties.

This model thus benefits consumers because they can verify that an entity that proposes to develop

a photovoltaic system for them (or sell them a subscription to a community solar project) is a

legitimate entity participating in the Program. It is important for the Agency to have the ability to

monitor the program and ensure high quality performance by the Approved Vendors; an Approved

Vendor that fails to live up to the requirements of the Adjustable Block Program could have a

significant negative impact on the entire renewable energy market in Illinois that would extend

beyond just its own actions. Additionally, as discussed in more detail in Chapter 8, registration as an

Adjustable Block Program Approved Vendor is a prerequisite to becoming an Illinois Solar for All

Approved Vendor, and the loss or suspension of Approved Vendor status under the Adjustable Block

Program would result in an Approved Vendor’s status under the Illinois Solar for All Program to also

being terminated or suspended.

The Agency does not restrict Approved Vendor participation by entity type; as such, Approved

Vendors could include a company that specializes in the aggregation and management of RECs; a for-

profit developer or installer of photovoltaic systems; a municipality; or a non-profit serving a specific

sector of the community, among others.

Approved Vendors serve as the contractual counterparty with the utility, and thus are the entity that

receives payments from the utility for REC deliveries as contract obligations are met.

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Approved

Vendors are therefore responsible for submitting necessary paperwork (project applications, status

updates, quarterly and annual reports) to the Program Administrator (as the responsible party for

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The Agency imposes no requirement as to how the Approved Vendor shall share the REC payments with the installer, host, and other

project parties.

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the information contained in that paperwork), maintaining collateral requirements (and paying any

contractual clawback not covered by posted collateral), and providing ongoing information and

reporting. As such, the Approved Vendors must coordinate downstream information from

installers/developers as well as individual system owners (who may well provide required

information through the installer/developer). Failure to provide this necessary information in a

timely manner may result in disciplinary action as customers may be negatively impacted by an

Approved Vendor’s lack of responsiveness.

The Agency does not require a specific delegation of duties between the Approved Vendor, sales

generating firms, installer/developer, and system owner; rather, it believes that the market is better

suited to allow a variety of business arrangements to develop. The key consideration is that the

Approved Vendor is ultimately responsible for the fulfillment of contractual obligations, including

any obligations delegated to subcontractors, in a manner consistent with the requirements of this

Plan, other published program requirements stemming from this Plan (such as those found in the

Program Guidebook and Marketing Guidelines), and the Approved Vendor’s contract with the

counterparty utility.

As discussed in Section 7.8, the Agency now requires that Designees (entities working with or on

behalf of Approved Vendors for participating projects) be registered with the program. While this

does not change the responsibilities of the Approved Vendor, or the potential for an Approved Vendor

to be held accountable for the conduct of its Designee, the Agency believes that this step provides

additional information and transparency to consumers and to the marketplace generally.

Approved Vendors must agree to the following terms:

• Participate in registration and complete any training developed by the Agency

• Abide by these ongoing Program terms and conditions

• Provide information to the Agency on the Approved Vendor’s organizational history, capacity,

financial information, regulatory status in Illinois and other states (including current

complaints or other actions against the Vendor or prior complaints within the past five

years), etc.

• Disclose whether the entity is minority, woman, disabled, or veteran-owned, and provide an

estimate of the percentage of staff at time of registration and subsequent annual renewals

who are women, disabled, veterans, or minorities. This process will include specifying with

which certification programs the business has registered.

• Be registered to do business in Illinois

• Disclose to the Agency names and other information on installers and projects, while

otherwise maintaining confidentiality of information

• Document that all installers and other subcontractors comply with applicable local, state, and

federal laws and regulations, including for example, maintaining Distributed Generation

Installer Certification

• Provide samples of any marketing materials or content used by the Approved Vendor, and/or

their subcontractors/installers, designees, agents, and affiliates, to the Agency for review, as

requested.

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This requirement applies to, at minimum, printed materials, advertising through television and radio, websites (including affiliate

websites), web ads, marketing via email or social media, telemarketing scripts, and leads purchased through lead-generation vendors.

Illinois Power Agency 2022 Long-Term Plan (Final) August 23, 2022

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• Agree to make changes to marketing materials as instructed by the Agency.

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• Register and maintain such registration in GATS or M-RETS and demonstrate the ability to

manage project application and REC management functions in the applicable tracking system

• Pay applicable application fees

• Comply with all terms of contracts with utilities under the Program

• Submit Annual Reports on a timely basis

7.7.1. Supporting Stranded Distributed Generation Customers

One issue that has arisen since the approval of the Revised Long-Term Plan in 2020 is the creation of

“stranded” ABP distributed generation customers when an Approved Vendor goes out of business, is

having financial difficulties and is unwilling or unable to pass through promised REC payments, or is

suspended as a disciplinary action and prohibited from advancing projects through the application

process. The stranded customer may be left without an Approved Vendor to advance their

application through the review process, or to pass through promised REC payments from the

contracting utility. As part of the 2022 Long-Term Plan, the Agency is seeking Commission approval

of a proposed approach to address this issue.

The Agency’s primary concern is a positive resolution for the customer, including a path forward for

their project to be completed, approved as part of the ABP, and for the customer to receive promised

REC payments, if possible. Within the ABP, the Agency has recently encountered two situations where

customers were effectively stranded by an Approved Vendor. In both cases, the Program

Administrator was able to communicate with the affected customers and assist them in finding

another Approved Vendor that was willing to take on the customer’s contract.

The Agency believes that the option of referring customers to a designated aggregator Approved

Vendor that is willing to take on stranded customers is the best option for handling these types of

situations. Many customers will not have the time, interest, or ability to find a new Approved Vendor

on their own, especially because the customer may not understand the Program well enough to

explain the situation to other Approved Vendors. Furthermore, the Agency’s understanding is that

most Approved Vendors would not be interested in taking on stranded customers because the limited

financial benefit to the Approved Vendor, especially if REC payments have been made. If the prefers

to find a new Approved Vendor on their own, rather than use the aggregator Approved Vendor to

whom the Program Administrator refers them, they may do so.

The Agency may also consider developing other processes to address the stranded customer issue.

This may include, in these limited circumstances, allowing customers to directly receive incentive

payments (through loosening requirements around batching with other projects) by becoming a

single project Approved Vendor, or allowing the Program Administrator to function as an Approved

Vendor of last resort. The Agency would only make such substantive programmatic if a need for it

emerges, such as a dramatic increase in the number of stranded customers or the inability of any

alternative Approved Vendor to take on stranded customers. In such circumstances, the Agency

would develop new procedures through a stakeholder process.

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This requirement is not meant to impede the ability to market to customers, but rather to ensure that any types of marketing are not

deceptive, confusing, or misleading. Likewise, the Agency is concerned about misrepresentations that could be made about the relationship

between an Approved Vendor (or the subcontractors/installers) and the Agency or program.

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7.7.2. Approved Vendor Applications

Approved Vendors must have their approval renewed once a year. Failure by an Approved Vendor to

follow the requirements of the Adjustable Block Program, as determined by the Agency and/or its

Program Administrator, may result in the entity having the suspension of or losing its status as an

Approved Vendor and thus losing the ability to bring new projects into the programs. Losing that

status would not relieve an Approved Vendor of its obligations to ensure that RECs from its projects

that have been energized continue to be delivered to the applicable utility; failure to meet those

contractual obligations could result in having the Vendor’s credit collateral drawn upon. (See Section

7.12.1 for more discussion of contractual obligations.) As part of the renewal process, Approved

Vendors will submit their training materials and certifications showing that their agents have been

trained in accordance with program requirements. The Program Administrator may request other

materials and documents upon renewal as well, including, but not limited to, marketing materials

and employee training materials.

The Agency recognizes that there may be certain projects where the Approved Vendor model may

not be completely appropriate, and therefore allows an Approved Vendor who has only one project

to apply under a more limited set of requirements as a Single Project Approved Vendor. Specifically,

this designation may apply to a project that is owned by that Single Project Approved Vendor (as

opposed to a situation where the Approved Vendor is an intermediary between the system developer

and/or owner and the contracting utility). In this situation, the following provisions related to

Approved Vendors do not apply:

• Provide samples of any marketing materials or content used by the Approved Vendor, and/or

their subcontractors/installers and affiliates, to the Agency for review, as requested.

• Agree to make changes to marketing materials as instructed by the Agency.

In addition, the consumer protection requirements found Chapter 9 would not apply to the Single

Project Approved Vendor for a distributed generation project, but if the project is a community solar

system, all applicable community solar consumer protection requirements related to subscribers do

apply (including those concerning marketing materials referenced above).

Single Project Approved Vendors will need to request that status prior to submitting their system’s

Part I application, and the Program Administrator and Agency will review requests to ensure that

this process is not used to avoid the more general requirements of this program through the

establishment of nominally separate entities. The minimum size for a project submitted by a Single

Project Approved Vendor is 100 kW.

The Agency also encourages the hiring of graduates of job training programs (as described in Sections

8.8.1 and 8.9.1) to work on installations of projects supported by the Adjustable Block Program. The

Program Administrator currently requests Approved Vendors to report on the planned usage of job

training program graduates as part of the project application process and requires reporting on job

trainee hiring as part of the annual reports submitted by each Approved Vendor.

As more trainees become available, the Program Administrator will provide additional information

to Approved Vendors to support this goal.

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7.7.3. Equity Eligible Contractor Application Process

Approved Vendors that wish to submit projects into the Equity Eligible Contractor (“EEC”) category

must first apply to be certified as an EEC. They may do so in conjunction with their Approved Vendor

application or at any time after submitting their initial Approved Vendor registration. In order to

streamline the process for a new program participant to become a certified EEC and Approved

Vendor, the Agency and the Program Administrator will include the EEC certification document in

the Approved Vendor application. This will help prevent an EEC-qualifying applicant from missing

an essential step that could affect the Approved Vendor’s ability to participate in the Equity Eligible

Contractor category.

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If the Approved Vendor is organized as a corporation, general partnership, limited liability

partnership, limited liability company, or limited partnership, the applicant will be asked to

designate which owners, partners, or proprietors meet the EEC eligibility criteria. Similarly, if the

Approved Vendor is organized as a non-profit, the applicant will be asked to provide the board

membership of the non-profit and designate which board members meet the EEC eligibility criteria.

However, if the Approved Vendor is a sole proprietor, no additional designations are required.

An Approved Vendor can qualify for an EEC certification by having status under at least one of the

following four categories:

• Persons who graduated from or are current or former participants in the Clean Jobs

Workforce Network Program, the Clean Energy Contractor Incubator Program, the Illinois

Climate Works Preapprenticeship Program, Returning Residents Clean Jobs Training

Program, or the Clean Energy Primes Contractor Accelerator Program, and the solar training

pipeline and multi-cultural jobs program created in paragraphs (a)(1) and (a)(3) of Section

16-108.12 of the Public Utilities Act

• Persons who are graduates of or currently enrolled in the foster care system

• Persons who were formerly incarcerated

• Persons whose primary residence is in an equity investment eligible community.

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EEC applicants will be required to complete an EEC certification in addition to the general Approved

Vendor attestation and application. This certification must be completed by each owner or board

member in the organization used to establish EEC status.

The applicant will be asked if it would like to be identified as an Equity Eligible Contractor on the

public list of Approved Vendors on the illinoisabp.com and illinoisshines.com web sites; willingness

to be publicly identified as an Equity Eligible Contractor on those sites is not required for maintaining

EEC status.

All certified EEC Approved Vendors will be listed on public project application reports and potential

other public reports.

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See Docket No. 22-0231, Final Order dated July 14, 2022 at 71.

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Equity investment eligible communities are defined as 1) R3 Areas as established pursuant to the Cannabis Regulation and Tax Act, and

2) Environmental Justice Communities as established through Illinois Solar for All Program. For maps and address lookup tools for these

two areas see: https://r3.illinois.gov/eligibility and https://www.illinoissfa.com/environmental-justice-communities/ respectively.

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As part of the EEC certification process, the Program Administrator may follow up with the applicant

with additional questions to clarify EEC eligibility and reserves the right to seek additional

information or other documents to confirm EEC eligibility.

7.8. Approved Vendor Designees

In the First Revised Plan, the Agency created a new requirement for Approved Vendor Designees,

requiring that Designees must register with the program and be listed on the program websites (both

www.illinoisabp.com and www.illinoisshines.com) along with the Approved Vendor(s) with whom

they are working. Registration also requires the assent of the Approved Vendor(s), and can be

withdrawn by an Approved Vendor working with the Designee at its discretion, or by the IPA or

Program Administrator if the Designee is found to have violated program guidelines and is

suspended or has its registration terminated. As used herein, by “Designee,” the Agency is referring

to third-party (i.e., non-Approved Vendor) entities that have direct interaction with end-use

customers. This includes, but is not limited to, installers, marketing firms, lead generators,

community solar subscription management firms, and sales organizations. The Agency reserves the

right to add additional categories as needed.

7.8.1. Designee Registration

Registration encompasses the Designee’s provision of contact information, acknowledgment of the

business relationship with the Approved Vendor, and identification of the categories of the

consumer-facing services provided. Designees must also indicate if they are minority-owned,

woman-owned, veteran-owned, disability-owned or considered a small business and provide an

estimate of the percentage of staff at time of registration who are women, minorities, veterans, or

disabled.

Additionally, a Designee is responsible for acknowledging that it will comply with all Program

requirements applicable to installers or marketing agents, as applicable. Since launching the

Adjustable Block Program, the Agency has become aware of instances of violation of program

guidelines by Approved Vendor Designees that may have been committed without the knowledge or

control of the underlying Approved Vendor. Failure by a Designee to comply with applicable

requirements could subject the Designee to suspension or termination from registration. If the

Designee ignores a suspension (or termination) decision made by the Program Administrator and

continues program activities nonetheless, any Approved Vendor that works with the Designee during

that period will be subject to discipline. Likewise, Approved Vendors found to be working with

entities engaged in the proscribed activities that fail to register will be subject to discipline.

Pursuant to the Commission’s Order in Docket No. 19-0995, Approved Vendors and their Designees

were to register with the Program by December 10, 2020 to remain in compliance.

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The purpose of this requirement is to increase transparency for the program. Potential customers

will be able to verify that a company that reaches out to them is actually a program participant

registered with the Program (and likewise be able to review if they are listed on the program’s

Consumer Protection Database or the program’s Disciplinary Actions Report)

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. While the Agency

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See Docket No. 19-0995, Final Order dated February 18, 2020 at 56.

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The ABP Consumer Protection Database and the Disciplinary Action Report can both be found here:

https://illinoisabp.com/consumer-complaint-database/

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had anticipated that smaller installers would work with Approved Vendors that are aggregators it

has become clear that sales and marketing of solar includes a variety of different types of

organizations and that this variance can create market confusion.

Approved Vendors are responsible for ensuring that their Designees register with the program

(which includes an attestation by that Designee that the Designee agrees to abide by program terms

and conditions), and Approved Vendors who fail to do so may be subject to disciplinary actions. This

includes Designees contracted by or working for other Designees, sometimes referred to as “nested”

designees. For example, for an Approved Vendor who has an installer serving as a Designee, and that

installer hires a lead generation firm to assist in marketing for customer acquisition purposes, the

Approved Vendor is responsible for ensuring that the lead generation firm (in addition to the

installer) registers with the program. One possible benefit to Approved Vendors through this system

will be that they will know what downstream firms are working with their direct Designees, and they

may be able to better monitor those firms’ behavior (as the Approved Vendor is ultimately

responsible with conformance with program guidelines).

The Agency also proposes that Designees go through an annual process to renew their registration,

similar to the current renewal process for Approved Vendors. As part of this process, Designees will

submit their training materials and certifications showing that their agents have been trained in

accordance with program requirements.

7.8.2. Equity Eligible Contractor Designees

As discussed in Section 7.4.6, a Designee may also register as an Equity Eligible Contractor. This

registration does not qualify projects from those Designees to be eligible for the Equity Eligible

Contractor category. Instead, as described in Section 7.4.6, such Designees would need to work with

an Approved Vendor that is EEC certified in order for their project to be eligible for the EEC category.

EEC certified Designees may also work with an Approved Vendor that is not EEC certified, but this

would make projects submitted by that non-EEC certified Approved Vendors ineligible for the EEC

category. The application process for Designees will use the same criteria as described in Section

7.7.2 for Approved Vendors.

7.9. Project Requirements

Projects that are eligible for the Adjustable Block Program must meet, at minimum, two sets of

requirements. The first relates to the technical aspects of the system itself, and the second to the

customer (and additionally to subscribers, in the case of community solar). The purpose of the first

set of requirements is to ensure that high-quality systems are installed that will be capable of

generating the expected quantity of RECs over the duration of the delivery contracts. The purpose of

the second set of requirements is to ensure consumer protections.

The Adjustable Block Program is intended to incentivize the development of new solar projects in

Illinois. Public Act 102-0662 further reinforced that intent through edits to Section 1-75(c)(1)(B)

expressly stating that it “shall not comply with the annual percentage targets . . . by procuring

renewable energy credits that are unlikely to lead to the development of new renewable resources.”

As such, projects that were energized after June 1, 2017 and previously participated in the Agency’s

2015-2017 utility distributed generation procurements or Supplemental Photovoltaic Procurement

pursuant to Section 1-56(i) of the IPA Act – under which REC prices were established to facilitate the

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successful development of those projects – will not be considered eligible for REC contracts under

the Adjustable Block Program.

7.9.1. Technical System Requirements

In this Section, the Agency outlines what technical information must to be submitted for each project.

These standards apply for both distributed generation and community solar projects. The application

process is described in more detail in Section 7.10.

The technical system requirements are as follows:

• Information about the system location, and size, including but not limited to

o A description of the technical specifications of the main system components including

the make and model, manufacturer, number (quantity) of panels, of panels and

inverters and meters, array location (roof or ground mount), tilt, orientation

o Site map or other project details

• Proof of site control and/or host acknowledgement

• Project-specific estimate of REC production during the delivery term using PV Watts or a

similar tool

• For distributed generation systems over 25 kW, an interconnection agreement signed by both

the interconnecting utility and the interconnecting customer

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• For community solar systems, a Certificate of Completion or Permission to Operate from the

interconnecting utility will continue to be required at the Part II application. An executed

interconnection agreement will no longer be required at the Part I application for community

solar projects.

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• For ground mounted systems over 250 kW, a land use permit, when applicable, from the

Authority Having Jurisdiction (“AHJ”) over the project. In the event a land use permit is not

applicable, written confirmation from the AHJ that no permit is required must be provided.

• For systems that include a battery, a detailed schematic showing that either only solar

generated power can be used to charge the battery or that the battery’s output does not run

through the meter used to measure solar output.

In the Initial Plan, the Agency required that “[f]or systems over 25 kW, evidence of having obtained

all non-ministerial permits that, according to the commercially reasonable investigation of the

Approved Vendor, are necessary to the project at the time of application to the Adjustable Block

program.” While the Agency no longer requires this provision (other than as specified above for land

use permits), failure to obtain permits is a developer risk and one which the Agency believes likely

would not allow for the invoking of force majeure provisions applicable to failing to meet contractual

obligations.

For systems that have been energized prior to application, the following information will also be

required:

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The Adjustable Block Program now provides for separate categories for systems up to 25 kW, and greater than 25 kW and up to 5,000

kW, and for the purposes of the requirements related to each project, the Agency has determined that this 25 kW breakpoint is the

appropriate for different levels for requirements.

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However, in approving this Plan, the Commission directed the Agency to adjust scoring for the Traditional Community Solar category

to encourage the participation of projects with a valid, executed interconnection agreement. See Docket No. 22-0231, Final Order dated

July 14, 2022 at 58-60. This scoring element does not apply to community solar projects which apply through the Community-Driven

Community Solar, Equity Eligible Contractor, or Public Schools categories.

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• GATS or M-RETS unit ID

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• Certificate of Completion of Interconnection

• Photographic documentation of the installation

The Agency recognizes that there may be special situations where some portion of these documents

may not be available (for example, some rural electric cooperatives and municipal utilities may not

have standardized interconnection documents). The Agency will consider alternative documentation

to demonstrate completion of interconnection in those situations.

7.9.2. Metering Requirements

In developing the Supplemental Photovoltaic Procurements that took place in 2015 and 2016, the

Agency developed a metering standard

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that is now used for the Adjustable Block Program. That

standard has been updated to reflect changes in M-RETS metering requirements that harmonize with

GATS standards and to clarify the use of inverters with integrated meters. The current standard

applicable to systems registered in either PJM-GATS or M-RETS is as follows:

• Systems 25 kW and over must utilize a new meter that meets ANSI C.12 standards. Inverters

with integrated ANSI C.12 compliant production meters are allowed with a specification

sheet showing this standard has been met. The inverter must be UL-certified and must

include either a digital or web-based output display.

• Systems over 10 kW and up to 25 kW in size utilize a meter that meets ANSI C.12 standards.

Meters that are refurbished (and certified by the meter supplier) are allowed. Inverters with

integrated ANSI C.12 compliant production meters are allowed with a specification sheet

showing this standard has been met. The inverter must be UL-certified and must include

either a digital or web-based output display.

• Systems of 10 kW in size and below must utilize either a meter that is accurate to +/‐ 5%

(including refurbished and certified meters), or an inverter that is specified by the

manufacturer to be accurate to +/‐5%. The inverter must be UL‐certified and must include

either a digital or web‐based output display.

In responses to Request for Comments after the Agency’s workshops for the development of the

Initial Plan,

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several commenters suggested allowing production estimates for smaller systems. A

production estimate consists of GATS automatically generating RECs for a system based on the

system size and engineering modeling of expected kilowatt hour generation. Production estimates

do not require the system owner (or aggregator) to provide ongoing data to GATS. While several

states do allow production estimates for smaller systems, because production estimates do not

require any actual data being transmitted to the tracking system to verify production, production

estimates could be problematic as there would be no way to verify the system’s ongoing operation.

By contrast, a meter read (from either a meter, or an inverter output) only needs to be submitted

once per year to GATS. The Agency thus does not allow production estimates for the Adjustable Block

Program or the Illinois Solar for All Program.

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GATS or M-RETS registration must be complete and unit ID verifiable through GATS or M-RETS public reports.

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See: https://ipa.illinois.gov/content/dam/soi/en/web/ipa/documents/ipa-metering-accuracy-standard-5-14-15.pdf.

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See: https://ipa.illinois.gov/energy-procurement/2017-long-term-renewable-resources-responses.html.

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Given the upfront payments for RECs paired with the 15- or 20-year requirement for RECs to be

delivered, the Agency believes that receiving actual data on system performance is essential to

ensuring the integrity of the RPS, and having meter reads as infrequent as annually (although they

could be as frequently as monthly) appropriately balances the need for accurate data and the

compliance burdens on the system operators. Therefore, in the Initial Plan required metered output

for the generation of RECs, although the use of inverter readings for systems up to 10 kW were

continued to be allowed.

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In other words, the metering standard developed for the Supplemental

Photovoltaic Procurement was the metering standard for the Adjustable Block Program, with the

caveat that meter reads were only required on an annual basis. The Agency understands that as of

January 1, 2020, M-RETS no longer required an ANSI C.12 certified revenue quality meter, so the

standards previously applicable for projects registered in GATS are now also applicable to projects

registered in M-RETS.

Additionally, in Docket No. 17-0838, questions were raised regarding the applicability of these

metering standards to DC-based technologies. In its Order approving the Initial Plan, the Commission

sought for the IPA to “ensure that its Plan does not inadvertently prohibit participation from systems

that do not convert the DC electricity produced to AC electricity,” with any resulting resolution to be

presented to the Commission “before or in the 2019 Plan update.” The IPA thus endeavored to work

with stakeholders on solutions for facilitating permissible participation in the Adjustable Block

Program from DC-based systems.

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After approval of the Initial Plan, the Agency communicated regularly and deliberately with industry

stakeholders who were seeking to coordinate and obtain ANSI approval of a new DC metering

standard. However, the Agency has not received any subsequent input from such stakeholders and

understands that this standard was finalized in of March 2021.

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The Agency has not reviewed the

applicability or relevance of this standard to its programs, nor has it received any expressions of

interest in systems metered in this manner. Should the Agency become aware of interest in DC-based

metering projects, it will initiate a stakeholder feedback process to establish appropriate DC

metering standards.

7.9.3. System Optimization

The Agency added information to the Illinois Shines website in 2021 to educate customers and

potential customers about optimal system design, and to provide information about typical ranges

for specifications of solar photovoltaic systems participating in the Adjustable Block Program.

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The

Agency plans to update the Distributed Generation Brochure and/or Disclosure Form following the

approval of this 2022 Long-Term Plan and is contemplating inclusion of a reference to this resource

therein. The Agency is also contemplating the development of additional educational materials to

ensure that customers are aware of optimal specifications for a photovoltaic system in Illinois.

For more information regarding consumer protections and strategies to ensure optimal system

specifications are known to consumers, please see Chapter 9 of this Plan.

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The Agency notes that while using an inverter rather than a meter may save on installation costs, if the inverter were to suffer a system

failure and lose data, no RECs could be created. A meter may be a more reliable way to ensure REC creation.

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Final Order, Docket No. 17-0838, April 3, 2018, at 78-79.

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See: https://energycentral.com/c/gr/ansi-dc-metering-standard-earned-emerge-alliance.

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See: https://illinoisshines.com/best-practices-for-system-design-and-evaluating-proposals/

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7.9.4. Co-location of Community Renewable Generation Projects

Co-location of projects occurs when multiple projects are located adjacent to each other, perhaps

using the same point of interconnection. Co-located projects can be structured to maximize income

from incentives, such as by dividing up a larger project into smaller pieces that qualify for higher

incentives. Community Renewable Generation Projects are defined in the Act as being smaller than

or equal to 5,000 kW, and for photovoltaic projects, the Adjustable Block Program includes adders

for smaller projects. Co-location strategies could therefore result in the gaming of incentives.

Minnesota offers two points of experience with the issue of co-location, for both community wind

and community solar. Under both policies, larger projects were structured as a series of smaller

projects to qualify for higher incentives, undermining the legislative intent of promoting distributed,

community-owned projects. A 30 MW wind project, owned by 15 corporate entities with the same

owners, was developed under the Minnesota Community-Based Energy Development (C-BED) tariff

program, which was intended to encourage community-owned wind projects of 2 MW or less. That

program was reformed in 2003 to be more prescriptive, limiting ownership to Minnesota residents,

with a single owner limited to a 15% share of a project.

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The development of the Minnesota Community Solar Gardens policy led to a similar problem. While

the legislature capped project size at 1 MW, it did not address co-location issues. As a result, 15 co-

located, aggregated projects were proposed between 10 and 20 MW, three between 20 and 30 MW,

and two in the 30 to 50 MW range. One developer, Sunrise Energy Ventures, filed applications for

100 projects within the first hour of the program. When the state Public Utilities Commission (“PUC”)

imposed co-location caps of 5 MW for projects with filed applications and 1 MW for newly proposed

projects, Sunrise appealed to the Minnesota Court of Appeals. The Court, however, affirmed the PUC’s

decision to implement caps.

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While co-location can undermine the concept of smaller and more geographically diffuse projects, it

can also capture economies of scale from larger projects: large, available parcels with good

interconnection points can be low-cost and efficient ways to develop large amounts of renewables

quickly. Low development costs could help compensate for the higher marketing and customer

acquisition costs of community renewable generation and provide greater benefits to low-income

customers. Also, different owners might apply to develop completely distinct projects at different

times, that just happen to be on adjacent parcels; restrictive rules would limit the development of

especially attractive parcels of land.

Public Act 102-0662 added a new provision related to the co-location of community solar projects,

“projects shall not be colocated with one or more other community renewable generation projects,

as defined in the Agency's first revised long-term renewable resources procurement plan approved

by the Commission on February 18, 2020, such that the aggregate nameplate capacity exceeds 5,000

kilowatts.”

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375

Jessica A. Shoemaker and Christy Anderson Brekken, Farmers’ Legal Action Group, Community Wind: A Review of Select State and Federal

Policy Incentives, August 2006, http://www.flaginc.org/wp-content/uploads/2013/03/CommWindAug061.pdf.

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Mitchell Williams, Selig Gates & Woodyard PLLC, “Community Solar Gardens: Minnesota Appellate Court Allows Public Utility

Commission to Implement Caps on Usage,” Lexology, August 23, 2016. http://www.lexology.com/library/detail.aspx?g=c4690835-61c4-

40cf-8105-0cc8d3229c77.

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See 20 ILCS 3855/1-75(c)(1)(K)(iii)(3).

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As the maximum size for community solar projects is now 5 MW, this would appear to preclude the

co-location of 5 MW community solar projects and only allow for the co-location of smaller projects.

The following co-location standard reflects that definition of co-location updated to account for the

maximum size:

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• No Approved Vendor may apply to the Adjustable Block Program for more than 5 MW of

Community Solar projects on the same or contiguous parcels (with each “parcel” of land

defined by the County the parcel is located in).

• A parcel of land may not have been divided into multiple parcels in the two years prior to the

project application in order to circumvent this policy. If a parcel has been divided within that

time period, the requirement will apply to the boundaries of the larger parcel prior to its

division.

• If there are multiple projects owned or developed by a single entity (or its affiliates) located

on one parcel of land, or on contiguous parcels of land, any size-based adders will be based

on the total size of the projects owned or developed on the contiguous parcels by that single

entity or its affiliates. Furthermore, the total combined size of projects owned or developed

by a single entity (or its affiliates) on contiguous parcels of land may not be more than 5 MW.

o “Affiliate” means, with respect to any entity, any other entity that, directly, or

indirectly through one or more intermediaries, controls, is controlled by, or is under

common control with each other or a third entity. “Control” means the possession,

directly or indirectly, of the power to direct the management and policies of an entity,

whether through the ownership of voting securities, by contract, or otherwise.

Affiliates may not have shared sales or revenue-sharing arrangements, or common

debt and equity financing arrangements.

o “Contiguous” means touching along a boundary or a point. For example, parcels

touching along a boundary are contiguous, as are parcels that meet only at a corner.

Parcels, however near to each other, that are separated by a third parcel and do not

touch along a boundary, or a point are not contiguous.

• Projects owned or developed by separate entities (meaning that that they are not affiliates)

may be located on contiguous parcels. If there is a naturally good location from an

interconnection standpoint, one owner should not be allowed to prevent another owner from

developing a project in that location.

• Projects must have separate interconnection points.

7.9.5. Eligibility of Projects Located in Rural Electric Cooperatives and

Municipal Utilities

The definition of community renewable generation projects specifically mentions rural electric

cooperatives and municipal utilities,

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but does not explicitly include or exclude them from any

program or procurement to be run by the Agency. Moreover, the definition includes the concept of

that project having “subscribers,” a term which in turn has a definition that defines such “subscribers”

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A reference to “competitive procurements” has also been removed as it would have applied to the now repealed Illinois Solar for All

Low-Income Community Solar Pilot Procurement.

379

See 20 ILCS 3855/1-10 ("’Community renewable generation project’ means an electric generating facility that is . . . interconnected at

the distribution system level of an electric utility as defined in this Section, a municipal utility as defined in this Section that owns or

operates electric distribution facilities, a public utility as defined in Section 3-105 of the Public Utilities Act, or an electric cooperative, as

defined in Section 3-119 of the Public Utilities Act”).

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as “tak[ing] delivery service from an electric utility,” which as defined in the IPA Act does not include

cooperative and municipal utilities.

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This resulted in ambiguity around whether a community

renewable generation project can be located within the service territory of a rural electric

cooperative or a municipal utility.

The Agency recognized the General Assembly’s choice expressly to include those entities in defining

“community renewable generation projects”—a term only used in the IPA Act in connection with the

Agency’s community renewable generation program—and proposed in its Initial Plan that

community renewable generation projects (including community solar) located in these service

territories should, if possible, be eligible for the Adjustable Block Program and Illinois Solar for All

Program (where applicable).

The status of community renewable generation projects and distributed renewable energy

generation devices located in the service territories of rural electric cooperatives, municipal electric

utilities, and Mt. Carmel Public Utility Company was a contested issue in Docket No. 17-0838. The

Commission’s Final Order in that proceeding determined that the Agency’s Initial Plan correctly

allowed the participation of these projects in the Adjustable Block Program, the Community

Renewable Generation Program, and the Illinois Solar for All Program.

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In June 2018,

Commonwealth Edison Company filed a petition seeking review of that determination (i.e., an

appeal) with the state’s Second District Appellate Court, case number 2-18-0504. On May 2, 2019, the

Appellate Court affirmed the ICC’s decision in this regard. On July 11, 2019, ComEd filed a Petition

for Leave to Appeal, No. 124898, with the Supreme Court of Illinois. It was denied on September 25,

2019, resolving this issue and clarifying that projects in the service territories of rural electric

cooperatives, municipal electric utilities, and Mt. Carmel Public Utility Company, are indeed eligible

to receive REC delivery contracts under the Adjustable Block Program.

As mentioned above, there are already at least three community solar offerings by or within rural

electric cooperatives that are not part of the Adjustable Block Program. Illinois’ first community solar

project was a 126 kW installation in Elizabeth, Illinois, built by Jo Carroll Energy in December 2014.

382

That project allows Jo Carroll customers to buy individual panels in the 460-panel ground-mounted

system, with the energy produced credited against their bills. Prairie Power sells kWh blocks of solar

power to customers of its 10 distribution cooperatives through the Bright Options Solar program.

The program is supplied by two 500 kW solar installations near Shelbyville and Astoria, both built in

2015.

383

Neither of these projects would be eligible to participate in the Adjustable Block Program

because they were energized prior to June 1, 2017, but they indicate that rural electric cooperatives

have thus far been the leaders in community solar in Illinois. Several proposed community solar

projects that would be located within the Jo Carroll Energy service territory applied to the Adjustable

380

Specifically, Section 1-10 of the IPA Act defines an electric utility as having “the same definition as found in Section 16-102 of the Public

Utilities Act,” which is “a public utility, as defined in Section 3-105 of this Act, that has a franchise, license, permit or right to furnish or sell

electricity to retail customers within a service area.” 220 ILCS 5/16-102. Section 3-105 of the PUA in turn defines “public utility” to

expressly exclude “public utilities that are owned and operated by any political subdivision, public institution of higher education or

municipal corporation of this State, or public utilities that are owned by such political subdivision, public institution of higher education,

or municipal corporation and operated by any of its lessees or operating agents” as well as “electric cooperatives as defined in Section 3-

119” of the PUA. 220 ILCS 5/3-105.

381

See Docket No. 17-0838, Final Order dated April 3, 2018 at 177-179.

382

Jo Carroll Energy, https://www.jocarroll.com/south-view-solar-farm.

383

Prairie Power, https://www.ppi.coop/brightoptions.

Illinois Power Agency 2022 Long-Term Plan (Final) August 23, 2022

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Block Program, and one – the Apple Canyon Lake Solar Farm – was allocated a REC contract via the

April 10, 2019 lottery and is currently in operation.

The 2022 Plan proposed no changes to the standard for allowing community renewable generation

projects in the service territories of rural electric cooperatives and municipal utilities to participate

in the Agency’s programs or procurements from the standard approved by the ICC in the Initial Plan.

This standard, outlined below, may require actions be taken by the rural electric cooperative or

municipal utility. As entities not regulated by the state, they are free to choose whether to take these

actions, but should they choose not to, then the residents and businesses within their service

territories would not benefit from receiving revenue through these programs for its RECs, and thus

the economics of such projects may not be as attractive to developers or subscribers.

The requirements for participation for a community renewable generation project located in a rural

electric cooperative or municipal utility follow from those required in the Act for electric utilities:

• Be capable of “credit[ing] the value of electricity generated by the facility to the subscribers

of the facility.”

384

This can be accomplished through offering “virtual net metering”

substantially similar to the provisions contained in Section 16-107.5(l) of the Public Utilities

Act.

385

The value of electricity credited must be at no lower than the subscriber’s supply

rate.

386

• Provide a monetary credit to a subscriber's subsequent bill for service for the proportional

output of a community renewable generation project attributable to that subscriber.

387

• Purchase any unsubscribed energy from community renewable generation projects that are

Qualifying Facilities ("QF") under the electric utility's tariff for purchasing the output from

QFs under Public Utilities Regulatory Policies Act of 1978.

388

Prior to a photovoltaic community renewable generation project applying for the Adjustable Block

Program, or a community renewable generation project powered by other renewable technologies

participating in the competitive procurement, the Approved Vendor shall obtain a certification

addressed to the Agency that the rural electric cooperative or municipal utility has met these

conditions from the subject cooperative or municipal utility. Absent this information, a project

located in the service territory of that rural electric cooperative or municipal utility will not be

allowed to participate. All other programmatic requirements for community renewable generation

projects (e.g., size limits, co-location, consumer protections) would apply to projects located in rural

electric cooperatives or municipal utility service territories. For the purposes of rural electric

cooperatives, these requirements apply at the distribution cooperative level, rather than for

generation and transmission cooperatives (which do not directly interact with retail customers).

384

See definition of “Community Renewable Generation Facility” in 20 ILCS 3855/1-10.

385

See 220 ILCS 5/16-107.5(l).

386

If the municipal utility or rural electric cooperative does not have unbundled rates (e.g., separate line items for delivery services and

electricity supply) then the applicable municipal utility or rural electric cooperative must indicate the portion of the bundled rate that

reasonably correlates to the cost of electricity supply service.

387

See 20 ILCS 3855/1-75(c)(1)(N).

388

See id.

Illinois Power Agency 2022 Long-Term Plan (Final) August 23, 2022

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7.9.6. Specific Requirements for Community Solar

Community Renewable Generation remains a developing concept in Illinois. It is intended to allow

consumers to participate in renewable energy generation even if they are unable to have an on-site

system at their home or business, and to offer a more direct connection to the benefits of renewable

energy than signing up for a renewable energy retail supply offer from an Alternative Retail Electric

Supplier (where information about the specific sources, costs, and benefits of the renewable energy

and the underlying generating system(s) may not be readily available).

Community, or “shared,” renewable energy is growing nationally, most often in conjunction with

solar power. The Solar Energy Industries Association reports that nearly 3,100 MW of community

solar had been developed in the United States through 2020.

389

Many policy issues that have been debated in other states are resolved in Illinois the law itself,

including elements of project size, ownership structures, and the minimum number and type of

subscribers. In addition to explaining those aspects of Illinois law, within this Section 6.9.6 and the

following subsections, the Agency outlines the terms and conditions for the Community Renewable

Generation Program that are not prescribed by the IPA Act.

7.9.6.1. Subscriber Requirements

With community renewable generation still an emerging concept, the level of consumer interest and

the most viable business models remain to be determined. Most offers the Agency has observed in

the market to date are simply cost savings offers under which the customer pays a lower per kilowatt

hour fee for a community solar subscription than the customer receives as a per kilowatt hour credit

through net metering. In general, Agency seeks to allow creativity and flexibility in developing

projects and creating unique value propositions for subscribers, while at the same time ensuring

basic consumer protections for subscribers to a community renewable generation project. These

considerations will apply for all types of community solar projects.

7.9.6.2. Small Subscriber Participation

In the development of the Initial Long-Term Plan to address the requirement that the Agency propose

terms and conditions that “ensure robust participation opportunities for residential and small

commercial customers and those who cannot install renewable energy on their own properties,”

390

the Agency defined small subscribers as “residential and small commercial customers” so long as

their subscription size is below 25 kW. While the Agency did not require a minimum participation

level for small subscribers, the initial lottery for community solar project selection included a first

phase for projects that committed to serving at least 50% small subscribers, and REC pricing included

adders for reaching certain levels of small subscriber participation.

Public Act 102-0662 codified this level of small subscriber participation with Section 1-

75(c)(1)(K)(iii)(2) now requiring “projects shall have subscriptions of 25 kW or less for at least 50%

of the facility's nameplate capacity and the Agency shall price the renewable energy credits with that

as a factor.” As this is not a hard minimum for small subscriber participation, the REC prices for

community solar projects now include consideration of the costs of acquiring and maintain small

389

https://www.seia.org/initiatives/community-solar

390

20 ILCS 3855/1-75(c)(1)(N)

Illinois Power Agency 2022 Long-Term Plan (Final) August 23, 2022

201

subscribers rather than having them as a separate adder, as explained above in Section 7.5.6 and

approved by the Commission in Docket No. 22-0231.

391

7.9.6.3. Utility Responsibilities

While the Agency, through the Adjustable Block Program and competitive procurements, will be

responsible for the procurement of RECs from community renewable generation projects, it is not

responsible for all aspects of a successful program. There are additional key aspects of making

community renewable generation projects successful that fall outside of the control of the Agency:

• The crediting of the value of energy through net metering

• Ensuring the portability and transferability of subscriptions within a utility service territory.

The Agency will work with system owners and developers as well as the utilities (and with rural

electric cooperatives and municipal utilities should they choose to participate) to reflect these

aspects in the terms, conditions, and operational aspects of the programs and procurements

conducted by the Agency. The Agency will also coordinate with the utilities for the sharing of any

pertinent data and information that each party collects and maintains regarding projects and

subscriptions.

Under the provisions of P.A. 99-0906, the Commission approved tariffs for ComEd, Ameren Illinois

and MidAmerican on September 27, 2017, which the Agency understands complied with the

requirements of Section 16-107.5 of PUA in terms of crediting to subscribers and with the

requirements of and Section 1-75(c)(1)(N) of the IPA Act in terms of subscription portability.

Public Act 102-0662, significantly updated the net metering requirements for the utilities and set a

deadline for new tariffs to be filed within 90 days and approved by the Commission within 120 days

of the effective date of Public Act 102-0662.

392

First and foremost under the changes to Section 16-107.5 of the PUA is the addition of the provision

that “only electric utilities serving more than 200,000 customers as of January 1, 2021 shall provide

net metering for projects that are eligible for subparagraph (C) of this paragraph (1) and have

energized after the effective date of this amendatory Act of the 102nd General Assembly[.]”

393

Subparagraph (C)(1) of Section 16-107.5(l) of the PUA identifies those net metering projects as

“subscriptions to community solar renewable generation projects, including community renewable

generation projects on the customer’s side of the billing meter of a host facility and partially used for

the customer’s own load.” As a result of these changes and in conjunction with the requirement that

updated tariffs be filed with the Commission 90 days after the effective date of 102-0662, on

December 14, 2021, MidAmerican filed a Petition for Special Permission to put updated tariffs into

effect on less than 45 days’ notice with changes to its Rate NMS – Net Metering for Subscribers to

Community Renewable Generation Projects (Rate NMS). These proposed revisions reflect the fact

that MidAmerican, as an electric utility serving less than 200,000 customers on January 1, 2021, is no

longer required to offer community solar subscription net metering for community renewable

generation projects built after September 15, 2021. Based upon the recommendation of ICC Staff, the

391

See Docket No. 22-0231, Final Order dated July 14, 2022 at 97.

392

220 ILCS 5/16-107.5(l-5).

393

220 ILCS 5/16-107.5(l)(1).

Illinois Power Agency 2022 Long-Term Plan (Final) August 23, 2022

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Commission granted special permission to allow these tariff changes at its Regular Open Meeting on

January 5, 2022.

394

Other changes to Section 16-107.5 of the PUA pursuant to P.A. 102-0662 resolve questions regarding

the calculation of net metering credits and issues which require that electricity providers provide

credits “that include at least energy supply, capacity, transmission, and, if applicable, the purchased

energy adjustment.”

395

Additionally, electric utilities serving more than 200,000 customers as of

January 1, 2021 (i.e., ComEd and Ameren) shall provide the subscription credits on the customer’s

monthly utility bill at the utility’s total price to compare equal to the subscriber’s share of the

production of electricity from the project, including for customers on payment plans or participating

in budget billing programs.

396

ARES providing electric supply to a subscriber not subject to Sections

16-108.18 and 16-1118 of the PUA shall likewise provide the monetary credits to the subscriber’s

subsequent bill. Commonwealth Edison and Ameren Illinois have filed multiple updated tariffs with

the Commission, many of which remain under review or consideration for rehearing.

397

7.10. Application Process

The following section outlines the process and procedure that Approved Vendors will use to submit

projects to the Program Administrator for review and approval, as well as how projects, once

approved, will be placed into contracts with the utilities.

7.10.1. Batches

Under the Initial Plan, Approved Vendors were required to submit projects bundled into batches. For

the First Revised Plan, the Agency proposed (and the Commission approved) a simplification of the

batch process. For a new Approved Vendor, there remains the requirement for a submittal of a first

batch of at least 100 kW of projects, and that 75% of the capacity of that batch must be verified to be

approved. Approved Vendors are allowed to select which batches approved systems are placed into,

so that they can better manage their financing portfolios.

398

Once systems’ Part I applications are

verified, and before they are sent to the Commission for approval, an Approved Vendor will be

consulted and given the opportunity to specify how its verified systems are batched, so long as those

batches of verified systems are at least 100 kW in size.

For established Approved Vendors that have had a contract approved by the Commission and do not

desire to assemble batches into portfolios in this way, projects may be submitted on a rolling basis,

and as projects are verified, the Program Administrator will place them into new batches that will

result in a contract and/or new confirmations with one utility.

Utilities may use one master agreement with multiple confirmations (one confirmation per batch)

from an Approved Vendor, rather than having multiple contracts with the same vendor.

399

The

394

Illinois Commerce Commission Regular Open Meeting, January 5, 2022; Special Permission Letter, January 5, 2022.

395

220 ILCS 5/16-107.5(l)(2).

396

220 ILCS 5/16-107.5(l)(3).

397

See, e.g., Docket No. 22-0037 (pending), Docket No. 21-0851 (rehearing granted Mar. 3, 2021, Docket No. 21-0859 (approved Jan. 13,

2022).

398

See Docket No. 19-0995, Final Order dated February 18, 2020 at 75.

399

See Docket No. 17-0838, Final Order dated April 3, 2018 at 109.

Illinois Power Agency 2022 Long-Term Plan (Final) August 23, 2022

203

systems within the batch/confirmation will be listed on a schedule (or product order) attached to the

contract and may not be substituted once approved.

A batch may contain projects in different groups/blocks (and thus with different prices) and with

different adders. The price for the RECs for each system will be based on the price available within

the applicable block on the date of the submittal. The failure of any system to be developed (and thus

the forfeiture of any collateral associated with that specific system) will not impact any of the other

systems on the same schedule, although the Agency will monitor system failure rates across

Approved Vendors. Approved Vendors with high failure rates may be required to provide additional

information to the Agency for subsequent applications.

The Program Administrator will determine which utility will serve as the counterparty for each

contract. While a batch may contain projects in multiple utility service territories, the Program

Administrator will strive to assign contracts to the utility where the bulk of the projects are located

but may not always be able to do so because the Program Administrator will also consider how

assigning contracts to each utility will allow each utility to meet its pro-rata share of the RPS REC

targets and available RPS funding. The REC price for each system will be based on the applicable

Group for that system’s physical location, and not based on the identity of the counterparty utility to

that contract.

After a batch of projects is created by the Procurement Administrator, the number of RECs to be

delivered annually and payment amount(s) for the batch will be provided to the utility by the

Program Administrator for purposes of contract/confirmation preparation (i.e., the utilities will

track the RECs by batch rather than by individual unit). Utilities will send a report of RECs delivered

by batch semi-annually to the Program Administrator.

400

7.10.2. Systems below 25 kW

In responses to the Request for Comments that the Agency issued in June 2017, several commenters

recommended that systems under 25 kW only be submitted once they are completed and energized,

to minimize administrative burdens and avoid project attrition. While the Agency is sympathetic to

those ideas, it did not adopt that recommendation for several reasons. It may be difficult, or

impossible, to have appropriate consumer protections if the Agency sees information about a system

only after it is completed. Preventing problematic behavior (such as deceptive information about

system costs and payback times) should be done prior to the homeowner or business paying for the

system; that would not be the case if systems apply only after being energized.

To be clear, the Program does not prohibit an Approved Vendor from submitting a “new” system that

has already been energized, but the Approved Vendor will have to assume the risk that the system

may not meet the required terms and conditions and could be rejected and thus not be included in a

contract for the purchase of the system’s RECs. A system that is rejected could be resubmitted at a

later date if the deficiencies are cured, but the Agency cautions that some deficiencies may be difficult

or impossible to cure (particularly when related to ensuring consumer protections from the

beginning of the project’s life).

401

400

See id.

401

See Section 6.13 of the Revised Long-Term Plan for further discussion of consumer protections applicable to systems energized after

June 1, 2017 but before consumer protection requirements are finalized.

Illinois Power Agency 2022 Long-Term Plan (Final) August 23, 2022

204

7.10.3. Application Fee

For each project, a non-refundable application fee must be paid to the Program Administrator or the

Agency of $10 per kW, not to exceed $5,000 per project. This fee will be used to offset the

administrative costs of running the program and will decrease the administrative fees that would

otherwise be taken from the utility RPS budgets.

7.10.4. Project Review

The Program Administrator reviews project applications received by the Program and as needed,

requests additional information from the Approved Vendor in order to verify the submitted

information and approve the project. An Approved Vendor will be given up to two weeks to cure

deficiencies in an application. If deficiencies cannot be cured, the project application will be

withdrawn. If the Approved Vendor can subsequently address the deficiencies, the Approved Vendor

can resubmit the project (with a new application fee). For Approved Vendors participating in the

proposed training/mentorship program described in Section 7.2, as well as all Equity Eligible

Contractor qualified Approved Vendors (regardless of their participation in the training and

mentorship program), new application fees will be waived if the resubmittal happens within three

months of the initial application being withdrawn.

402

For an initial 100 kW batch, if, after any attempts to cure deficiencies have been made, projects

representing at least 75% of the capacity of the batch are reviewed and approved by the Program

Administrator, that batch will included in a contract presented to the Commission for approval. For

established Approved Vendors, on a rolling basis in anticipation of the next scheduled Commission

meeting, the Program Administrator will place verified projects for each Approved Vendor into

batches for assignment to a counterparty utility, and prepare the confirmation information (and, in

that case, master agreement information, if it is the Approved Vendor’s first batch) or the contract

information related to that batch.

403

The Program Administrator will then submit the contract information for the batch to the

Commission for approval. The Program Administrator will simultaneously forward the contract

information to the applicable utility.

404

An Approved Vendor that repeatedly submits deficient or noncompliant project applications may be

subject to having its Approved Vendor status reviewed, and possibly suspended or terminated.

7.10.5. Converting System Size into REC Quantities

For each approved system, the Program Administrator will calculate a 15 or 20-year REC payment

amount and obligation level, and that payment amount and delivery obligation will be included in the

REC Contract. Approved Vendors will have the option of using a PVWatts calculated capacity factor

(stated relative to a system’s nameplate capacity in AC rating) automatically computed by the

application platform or proposing an alternative capacity factor based upon an analysis conducted

using an equivalent tool. Alternative capacity factors may be proposed as part of each system’s

application and will be subject to review and approval by the Program Administrator. Systems using

bifacial panels must submit an alternative capacity factor subject to review and approval by the

402

See Docket No. 22-0231, Final Order dated July 14, 2022 at 69.

403

See Docket No. 17-0838, Final Order dated April 3, 2018 at 115-116.

404

See id.

Illinois Power Agency 2022 Long-Term Plan (Final) August 23, 2022

205

Program Administrator. All capacity factors submitted must be for a system’s first year; as stated in

Section 7.12.2 below, annual REC delivery commitments will incorporate a 0.5% per year

degradation factor.

7.10.6. Batch Contract Approval

The Commission meets approximately every two weeks. The Program Administrator will strive to

efficiently process approved projects and assign them to batches for submittal to the Commission.

The Agency understands that Commission practice is that items for consideration by the Commission

must be submitted to be placed on its open meeting agenda at least 8 business days prior to each

meeting.

When the Program Administrator submits contract information to the Commission for approval, that

submittal will include the Program Administrator’s recommendation for approval of the batch, with

a summary of factors relevant to Plan compliance. (Projects that are not approved by the Program

Administrator are not submitted to the Commission.) This process is similar to that required for

approval of contracts under annual electricity procurement plans pursuant to Section 16-111.5(f) of

the PUA, or contracts under the Supplemental Photovoltaic Procurement Plan pursuant to Section 1-

56(i)(5) of the Act.

405

Pursuant to the Initial Plan, the Agency worked with Commission Staff to develop a Staff Report that

includes the standards that the Commissions should use in considering the approval of contracts and

product orders within the ABP and ILSFA.

406

The Commission approved the recommendations

contained in the Staff Report on December 19, 2018. Upon approval of this Plan by the Commission,

the Agency and Commission Staff will review and update that Staff Report if necessary.

Once a batch is approved by the Commission, the applicable utility will execute the REC contract

and/or product order, as applicable. The Approved Vendor will then be required to sign the contract

or product order within seven business days of receiving it from the utility.

407

Failure to sign the

contract or product order may subject the Approved Vendor to discipline under the Program.

Additionally, when a contract or product order is not executed by the Approved Vendor within the

seven business days after receipt, the constituent projects will be considered removed from the

Program, with the option to re-apply later, subject to payment of a new application fee and available

open block capacity (and subject to the applicant’s Approved Vendor status not having been revoked

due to the product order’s non-execution). A collateral requirement to be held by the utility equal to

5% of the total contract value will be required in the form of either cash or a letter of credit with the

utility within 30 business days of Commission approval of the contract.

In the First Revised Plan, the Agency recommended, and the Commission approved a clarification to

the collateral withholding process to be reflected in the updated REC contract (as discussed in Section

7.14). In cases where collateral was posted through a letter of credit, the Approved Vendor may

choose for the utility to withhold the collateral amount for each system from the last (or only, if a

405

See id.

406

See: https://www.icc.illinois.gov/downloads/public/edocket/490368.pdf.

407

See id.

Illinois Power Agency 2022 Long-Term Plan (Final) August 23, 2022

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distributed generation system of 25 kW or smaller in size) REC payment in exchange for a

release/reduction of the letter of credit.

408

In the Initial Plan, the Agency provided an option to allow an Approved Vendor to be able to forgo

posting collateral for a system that was already energized and instead have that collateral withheld

from the REC payment. The intent of that provision was to allow systems that had been developed

prior to the program launch to have a simplified process, recognizing of those systems’ absence of

development risk. However, the Agency has observed that this process has had an unintended

consequence of encouraging some Approved Vendors to submit projects only after their energization

as a way of avoiding any collateral obligation. If the project does not apply until after it is built,

enforcing and ensuring consumer protections (and other program requirements) becomes more

challenging. Ultimately, consumers are better served if their project can be reviewed and approved

by the program (and then submitted to the ICC for approval) prior to being built. For this reason, the

Agency will require upfront collateral in all cases, including for energized systems under the new

2021 REC Delivery Contracts utilized for program reopening in December 2021.

Approved Vendors do not have the option to decline to post collateral within 30 business days once

they have signed the contract. Failure to post collateral by the 30 business day deadline will violate

the REC contract and may result in an Approved Vendor being suspended from further participation

in the program.

7.10.7. Assignment of Projects

Section 1-75(c)(1)(L)(x) of the IPA Act now expressly provides that “[c]ontracts may be assignable,

but only to entities first deemed by the Agency to have met program terms and requirements

applicable to direct program participation.” In addition, “[i]n developing contracts for the delivery

of renewable energy credits, the Agency shall be permitted to establish fees applicable to each

contract assignment.

Contracts or individual batches (but not individual projects that form a subset of a batch) are

assignable. The assignee must agree to, and abide by, the applicable terms and conditions required

of an Approved Vendor (or a Single Project Approved Vendor in the case of the assignment of a single

project from a contract). Consistent with the Commission’s Order in Docket No. 17-0838, the assignor

and the assignee will be required to notify the contracting utility of any assignment, and provide the

utility with all pertinent financial, settlement and contact information.

409

The assignor may be

required to pay a fee to the contracting utility. The Agency and its Program Administrator have

generated form documents

410

for use in accommodating the assignment process and will endeavor

to cooperate with the assignor, assignee, and utility in updating Program records to accommodate

the assignment. More specific project assignment terms and conditions (such as the of assignment

408

This provision would not apply to cash collateral for the following reason. If a project had a total REC value of $100, $5 of collateral

would be due. To swap the 5% collateral for a withheld payment, $100 in total payments ($95 of REC payments plus a return of $5

collateral) would need to be made, leaving a balance held by the utility of $5, the same as before. On the other hand, if the collateral were

a letter of credit, then a payment of $95 would eliminate the need for the Approved Vendor to maintain the letter of credit (or portion

thereof) for the remaining life of the contract.

409

See Docket No. 17-0838, Final Order dated April 3, 2018 at 74.

410

See: https://illinoisabp.com/wp-content/uploads/2019/07/ABP-Acknowledgement-of-Assignment.pdf; https://illinoisabp.com/wp-

content/uploads/2019/10/ABP-Acknowledgement-of-Assignment-and-Consent-2019_10_23.pdf.

Illinois Power Agency 2022 Long-Term Plan (Final) August 23, 2022

207

fees) have generally been handled through the development of the REC delivery contracts

themselves, and the Agency proposes a continuation of that approach.

For waitlisted projects, projects may be selected off a waitlist in any given Group/category

combination either when previously selected and approved projects drop out of the program, thus

freeing up program capacity (with the project selected from the waitlist receiving the most recently

available REC price), or when a new block of capacity is opened (and receive that block’s REC price).

While projects on a waitlist are not yet under contract,

411

an Approved Vendor may assign that

project to another Approved Vendor, or the project itself may be sold, without penalty or impacting

the project’s position on the waitlist. An Approved Vendor must promptly notify the Program

Administrator

412

of that transfer and provide appropriate documentation.

Projects that are developed by Approved Vendors certified as Equity Eligible Contractors and receive

a REC contract through the EEC block of capacity may not assign those projects to an Approved

Vendor that is not also a certified Equity Eligible Contractor for six years after the Part II verification

date of the project. After six years from the Part II verification date has passed, this moratorium on

assigning EEC projects to Approved Vendors that are not certified as an EEC is lifted.

7.11. Project Development Timeline and Extensions

7.11.1. Development Time Allowed

Once a contract for a batch has been executed by the Approved Vendor and the utility, the next step

is for projects not yet developed to be developed and energized. The following timelines are based

upon the REC delivery contract execution date, such that any delays in processing and approving an

application will not reduce the time available for development.

• Distributed generation projects will be given 18 months to be developed and energized.

• Community solar projects will be given 24 months to be developed, energized, and

demonstrate that they have sufficient subscribers.

A project that is not completed in the time allowed (plus any extensions granted) will be removed

from the contract, and the REC volume associated with the project will be eliminated from the

contract. The Approved Vendor will also forfeit the posted collateral associated with the project. Any

forfeiture of collateral by the Approved Vendor under the REC contract will be considered to be

returned to the utility’s available Renewable Resources Budget and will become available for REC

delivery contracts for other projects.

A project that is not completed in time and is removed from the contract may be subsequently re-

submitted by an Approved Vendor but will be treated like any other new system being submitted.

In some instances, the developer of an Adjustable Block Program project may learn that development

of the project is no longer feasible—whether due to financing falling through, the system host no

longer wanting to move forward with the project, or myriad other circumstances. Under the language

of the 2019 REC delivery contract, such a system could not be removed from the contract until

411

The allowances in this sentence also apply to a non-waitlisted Part I applicant project that has not yet been selected by the Program

Administrator for a REC contract.

412

For this Chapter, all references to the Program Administrator refer to the Program Administrator for the Adjustable Block Program.

Discussion of the Program Administrator for the Illinois Solar for All Program can be found in Chapter 8.

Illinois Power Agency 2022 Long-Term Plan (Final) August 23, 2022

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contract requirements related to a Seller meeting the system’s energization deadline were not timely

met, a contract violation which may not occur until over one year from the point at time in which the

Seller learns that development is no longer feasible.

Thus, in the First Revised Plan, the Agency sought Commission permission to allow the Seller to

provide notification to the Buyer, the Agency, and the Commission that it is exercising its option

allowing for a system’s removal from the contract because the Approved Vendor no longer wished to

develop that system. Under these circumstances, the Seller would forfeit the posted Performance

Assurance applicable to the system. Doing so allows the contract parties (the utility Buyer and

Approved Vendor Seller) to no longer maintain a contractual obligation when performance is no

longer intended, while also providing clarity to the Agency and its Program Administrator about the

availability of new Program capacity through removal of a project from a REC contract. This proposal

was approved by the Commission in Docket No. 19-0995, and the Agency has since developed specific

forms and procedures to effectuate this option for Sellers.

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7.11.2. Extensions

Extensions to the energization deadline will be granted for the following circumstances.

• An indefinite extension will be granted if a system is electrically complete (ready to start

generation), but the utility has not approved the interconnection. The Approved Vendor must

document that the interconnection approval request was made to the utility within 30 days

of the system being electrically complete, yet not processed and approved.

• A 6-month extension will be granted for documented legal delays, including permitting

delays.

• A 6-month extension will be granted upon payment of a refundable $25/kW extension fee,

for distributed generation systems, and up to two 6-month extensions for community solar

projects (the second extension is only for achieving the required subscriber rate, not for

project completion and energization, and will require an additional refundable $25/kW fee).

The extension fee(s) is payable to the contracting utility and would be refunded as part of the

first (or only for systems up to 10 kW) REC payment.

• The Agency may also, but is not required to, approve extensions for demonstration of good

cause.

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7.11.3. Project Completion and Energization

The Approved Vendor will provide the Program Administrator with a status update on each project

under development but not yet energized at least every six months and will inform the Agency of any

significant changes to the system.

415

For community solar projects, the update will include an update

on the status of acquiring subscribers. The Agency and Program Administrator have developed a

standardized form (including standard status categories to simplify reporting) for this purpose.

413

See Docket No. 19-0995, Final Order dated February 18, 2020 at 80.

414

Good cause extensions have been the primary means of allowing for extensions in energization deadlines due to COVID-19 related

delays, as described extensively in Chapter 3.

415

For systems under 25 kW, that status update is only be required for a system where there is a change in status (e.g., a project being

completed, or canceled).

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Once a project is energized, the following information is required from the Approved Vendor for the

Program Administrator to approve the final project as Energized for purposes of the REC delivery

contract and authorize commencement of payment for RECs:

• Final system size

• Final system specific capacity factor and REC production estimate

• GATS or M-RETS unit ID

416

• Certificate of Completion of Interconnection or comparable documentation

417

418

• Photographic documentation of the installation

• Disclosure of any changes to the system technical specifications that occurred between the

initial application and the completion of the project

• Identity of the installer (must be a Qualified Person under Part 468 of the ICC’s Rules)

• Documentation of compliance with prevailing wage requirements, if applicable

• Demographic information related to the workforce constructing and installing the system

Additional requirements may be published (such as through the Program Guidebook) by the Program

Administrator if the Agency determines that such requirements are warranted, and the Program

Administrator may reference other sources (such as public databases) to determine the accuracy of

any submissions.

If the final system size is larger than the proposed system size such that it would cause the system to

change from the up to and including 25 kW category to the over-25 kW category, the payment terms

will be adjusted from the full payment on energization to 15% on energization and the balance over

the next six years. The price per REC will also be changed to the applicable REC price for the over 25

kW category in effect at the time when the system is energized.

For systems over 25 kW, the final REC price will be based on the final system size if that final system

size would cause the REC price to remain the same or to decrease. A system that is developed at a

size smaller than the original application will not be eligible for a higher REC price.

The quantity of RECs used for payment calculations is based on the lesser of the RECs calculated

based on the proposed (Part I) system size and capacity factor, and the RECs calculated based on the

final (Part II) system size and capacity factor. The final capacity factor can be adjusted down from the

initial capacity factor, but can only be increased from the original capacity factor upon satisfactory

information submitted by the Approved Vendor that demonstrates modifications to the system

design that justify an increase. This could include changes in capacity factor due to switches between

tracking technology, non-tracking and tracking systems, and bifacial vs. standard module use. In no

case will the change in capacity factor allow for an increase in REC quantity from that approved at

the Part I stage. In this way, a system that is built smaller than planned will not benefit from excess

REC payments that could result from purposefully submitting the project at a larger size than really

intended. On the opposite side, if a project’s final system size is significantly larger than the planned

system size, an increase in the payment due could present unexpected budget management

challenges. An Approved Vendor has the option of canceling and resubmitting a system if the final

416

GATS or M-RETS registration must be complete and unit ID verifiable through GATS or M-RETS public reports.

417

Comparable documentation would only apply for a rural electric cooperative or municipal utility that does not provide a Certificate of

Completion of Interconnection.

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Per Section 1-75(c)(1)(K) of the IPA Act, the date of final interconnection approval must be no earlier than June 1, 2017.

Illinois Power Agency 2022 Long-Term Plan (Final) August 23, 2022

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size is larger than the proposed system to align the REC quantities or if it desires to have the system

change from a distributed generation project to a community solar project, or vice versa. However,

the applicable REC price upon resubmittal is the price of the block open at that time (and subject to

any applicable waitlists), and not at the time of the original submittal. Because the Program

Administrator will need to review the system design (due to the change in system size), a new

application fee will be required. If a project is resubmitted, the collateral associated with the original

system may be applied to the resubmitted system, if approved.

While the Approved Vendor is the entity that receives REC payments, the terms of sharing that REC

payment value with customers (completely, partially, or not at all; immediately or over time; directly

or indirectly) or obligations associated with a system’s performance assurance payment are left to a

customer and Approved Vendor (or customer and Designee) to work out between themselves prior

to executing an agreement. However, the clear failure to satisfy a contractual obligation to a customer

may result in the violation of program requirements and disciplinary action under the program.

The Agency reserves the right to request more information on an installation, and/or conduct on-site

inspections/audits of projects to verify the quality of the installation and conformance with the

project information submitted to the Agency. Projects found not to conform with applicable

installation standards and requirements, or projects found not to be consistent with information

provided to the Agency will be subject to removal from the program if the deficiencies cannot be

remedied. Likewise, Approved Vendors who repeatedly submit projects featuring application errors

or inconsistencies with program requirements may be subject to suspension or termination of their

Approved Vendor status.

7.11.4. Additional Requirements for Community Solar Projects

A community solar project must demonstrate that it has met a minimum subscription level to be

considered energized and eligible to receive payment for RECs. Under Section 1-75(c)(1)(K) of the

IPA Act, 50% of the subscriptions must be from small subscribers, and at least 50% of the capacity of

the project must be subscribed at the time of energization in order to receive payment for RECs, and

that payment will be based upon calculating the number of RECs that correspond with the amount of

the project’s capacity that has been initially subscribed. The Approved Vendor shall report

subscription levels on a quarterly basis during the first year. The calculation of the number of RECs

for payment will be updated after one year of operation (based on the final quarterly report of that

first year) to allow for the acquisition of additional subscribers. A community solar project may

request one additional extension (with a refundable extension payment as provided for in Section

7.11.2) to its energized date if it needs additional time to acquire subscribers.

To the extent that an Approved Vendor demonstrates additional subscriptions or updated

subscription mixes that would entitle the Approved Vendor to a greater payment, the contract will

require that subsequent payments reflect the increased value for quarters where the additional

subscriptions or updated subscription mix entitle the Approved Vendor to additional revenue. If

subscriber levels (or mixes) change in such a manner that contract value is reduced, the additional

payments would also be adjusted downwards accordingly.

419

The calculation of the maximum number of RECs due payment is determined by the project’s

subscription level after one year of operation (and will be subject to the maintenance of subscription

419

See Docket No. 17-0838, Final Order dated April 3, 2018 at 118.

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levels as described in Section 7.15). For determining the contract payment amount based on a

project’s subscription level, Section 1-75(c)(1)(L) of the IPA Act provides that,

Notwithstanding the preceding, for those projects participating under item (iii) of

subparagraph (K), the contract price for a delivery year shall be based on subscription levels

as measured on the higher of the first business day of the delivery year or the first business

day 6 months after the first business day of the delivery year. Subscription of 90% of

nameplate capacity or greater shall be deemed to be fully subscribed for the purposes of this

item (iv).

Subscription of 90% of a project’s nameplate capacity or greater being deemed fully subscribed

applies to each quarterly report in which an Approved Vendor must verify a project’s subscription

levels. Thus, a project at 85% subscribed under this approach would have a contract price associated

with an 85% subscribed project, while a project 92% subscribed would be considered “fully

subscribed.” Ongoing requirements for overall subscription levels and small subscriber participation

are discussed further in Section 7.9.6.1.

7.12. REC Delivery

Once a system is energized, it is required to begin REC delivery. For systems larger than 5 kW, the

first REC must be delivered within 90 days of when the system is energized and registered in GATS

or M-RETS. For systems smaller than 5 kW, 180 days will be allowed. The 15 or 20-year delivery term

will begin in the month following the first REC delivery and will last 180 months or 240 months

respectively, depending on project category.

Approved Vendors will be required to set up an irrevocable Standing Order for the transfer of RECs

from the system to the utility.

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As the Agency understands that automatic transfers can only be

terminated with the consent of both parties, this will reduce the risk to the utility that the RECs could

be sold to another party after the utility has paid for them.

As part of the Annual Report discussed in Section 7.15, the Approved Vendor will report on any

systems that have not delivered a first REC, and report on any systems that have not delivered RECs

for more than a year from their previous delivery. The report will also detail what corrective actions

will be taken to ensure future deliveries. In the event of failure to remedy non-delivery of RECs, the

utility may draw on the collateral it holds from the Approved Vendor.

7.12.1. Ongoing Performance Requirements

A significant challenge for the Adjustable Block Program is that the payment for RECs is front loaded

for categories other than Traditional Community Solar and Public Schools (which pay for RECs on

delivery over 20 years); systems up to 25 kW feature full contract prepayment upon energization,

and all payments for systems over 25 kW will be made within the first six years of energization. Yet

those contracts have a 15-year REC delivery obligation. This creates a situation in which, absent any

additional measures, the buyer (the utility) will be unable to use the typical contractual tool of

withholding payments for the item not yet received to ensure REC delivery. Fortunately, the Act

anticipated this issue and requires that “[e]ach contract shall include provisions to ensure the

420

See Section 10.2 of the GATS Operating Rules available at https://www.pjm-eis.com/~/media/pjm-eis/documents/gats-operating-

rules.ashx.

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delivery of the estimated quantity of renewable energy credits and ongoing collateral requirements

and other provisions deemed appropriate by the Agency.”

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The Agency will utilize the approach described below to ensure REC delivery over the full term of the

contracts. This approach will also ensure proper matching of adders for photovoltaic community

renewable generation projects at different levels of residential subscription levels.

REC delivery obligations will be managed at a portfolio level. As projects are completed and become

energized, each Approved Vendor will therefore have a portfolio of systems with REC delivery

obligations from the various contracts that it has with each utility. The obligation to ensure REC

delivery is at the contract level rather than the individual project level. In this way, the natural

variation that some systems will produce more RECs than forecast and others fewer RECs reduces

the risk of contract default, as compared to project-level contracts, and allows for ease in contract

administration.

7.12.2. Collateral Requirements

An Approved Vendor is required to post collateral equivalent to 5% of the total contract value within

30 business days of when each Batch’s contract (or product order) is approved. As described in

Section 7.10.6, if the collateral was provided in the form of a Letter of Credit, then the Approved

Vendor may choose for the utility to withhold the collateral amount for each system from the last

REC payment for the system (or only REC payment for small systems) in exchange for not needing to

maintain the collateral in the form of the Letter of Credit. In this situation, the collateral would be

reduced as described below, and fully returned at the end of the contract (net any amounts that were

drawn to meet contractual obligations). As systems are energized, this collateral amount (or deferred

payment) will be maintained through the life of the contract. This requirement will be maintained at

the portfolio level, not the individual contract or system level. The collateral amount is based upon

the contract value at the time of ICC approval of the product order and is not adjusted if the final

system size and/or capacity factor (and thus resulting quantity of RECs for payment) is lower than

the initial approved amount.

By maintaining collateral requirements at the portfolio level, Approved Vendors can better manage

the risk that some systems may underperform (or have other problems) while others may

overperform. This allows the collateral level to be lower than it would be if maintained at the system

level.

The Agency wishes to emphasize that this Plan does not prescribe the source of funds for collateral,

whether it be an Approved Vendor’s cash on hand, bank borrowings, the project owner’s funds,

customer-provided funds, a letter of credit, or some other source.

Nonetheless, an Approved Vendor will be responsible for delivering RECs each year under its

contracts (subject to the reduction options described in the following Section). On an annual basis,

failure to deliver RECs for the previous year will result in the utility drawing on the collateral to be

compensated for the undelivered RECs from that year for which payment was already received. After

any such drawing, the Approved Vendor will need to restore its collateral level to bring it back up to

the 5% of remaining value of the portfolio within 90 days. If the amount of collateral held for an

Approved Vendor is insufficient to compensate the utility, the Approved Vendor will be required to

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20 ILCS 3855/1-75(c)(1)(L)(v).

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pay the utility for the balance of the value of the undelivered RECs from that previous year. Failure

to make payment and/or maintain the collateral requirement may result in the Approved Vendor’s

suspension from participating in the Program.

Additionally, the Agency understands and appreciates that the natural degradation of photovoltaic

system’s productive capacity will likely result in reduced delivery quantities in the later years of a

system’s performance under a REC delivery contract. Annual contractual REC delivery volumes will

thus be decline by 0.5% each year, which the Agency believes should help ensure that collateral is

not unfairly drawn upon due to reduced system performance.

422

Reconciliation of REC deliveries and collateral requirements will be conducted on an annual basis

based on the Annual Reports filed by the Approved Vendors as described in Section 7.15.

7.12.3. Options to Reduce REC Delivery Obligations

Section 1-75(c)(1)(L) of the IPA Act provides that, for categories other than Traditional Community

Solar and Public Schools projects, “[t]he electric utility shall receive and retire all renewable energy

credits generated by the project for the first 15 years of operation.”

423

The capacity factor as

described in Section 7.10.5 will be used to calculate the number of expected RECs each system

generates, and thus the overall payment for that system. If a system produces more RECs than

expected from that calculation, then no adjustment would be made to payments or to the statutorily

mandated REC delivery term. However, if the system produces fewer than the contracted quantity of

RECs, then the following conditions apply.

The Agency expects each Approved Vendor to take the steps necessary to ensure that projects

contained within its portfolio meet all expected REC deliveries. This may include working with

system owners to ensure that ongoing maintenance and repairs of systems occurs as well as to ensure

that meter/inverter data is properly transferred to GATS or M-RETS for the creation of RECs.

Furthermore, Approved Vendors will be responsible for ensuring the ongoing transfer of RECs to the

applicable utility. However, because weather and other factors may impact annual production values,

REC delivery performance will be evaluated on a three-year rolling-average basis, although any

overproduction may be carried forward (or “banked”) for performance evaluation and collateral

purposes into future contract years without expiration.

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However, a project or portfolio is not

entitled to additional compensation if a carryforward remains as project-specific contracts expire.

425

There are circumstances where a system may not be able to deliver the RECs it was expected to

produce; the Agency believes that reasonable accommodations should be made for these situations

that appropriately balance the requirements for the utilities to comply with RPS targets and their

expectation to receive RECs for which payment has already been made while acknowledging that

unexpected situations may arise at no fault of the Approved Vendor.

In force majeure circumstances (including, but not limited to, physical damage to the system from

fires, tornados, etc.) the Approved Vendor may request to have a delivery obligation suspended,

422

See Docket No. 17-0838, Final Order dated April 3, 2018 at 129.

423

20 ILCS 3855/1-75(c)(1)(L)(ii).

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All RECs must be delivered to the counterparty in the delivery year when produced, regardless of any overproduction under the contract.

See Docket No. 17-0838, Final Order dated April 3, 2018 at 129.

425

See Docket No. 17-0838, Final Order dated April 3, 2018 at 129.

Illinois Power Agency 2022 Long-Term Plan (Final) August 23, 2022

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reduced, or eliminated without penalty.

426

Approval of the recognition of a force majeure event

requires consensus between the Agency and the contracting utility. Curtailments by either the utility

(including those through a smart inverter) or the RTO that result in reduced REC production would

allow for reduced REC delivery obligations.

In the case of reductions or eliminations of delivery obligations, the Approved Vendor must

demonstrate what measures have been taken that do not adequately cure the situation (such as filing

and receiving an insurance claim that is inadequate to restore the system to operation). For the

suspension of delivery obligations, the Approved Vendor must demonstrate that reasonable

measures are being taken to have a timely restoration of production. Approved suspension of

delivery obligations will serve to change the end date for the REC delivery timeline to reflect the time

the delivery obligations were suspended.

An Approved Vendor may also determine that a system is not performing at the level expected in the

absence of force majeure circumstances. In this circumstance, the Approved Vendor may request to

have the delivery obligation related to that system within its portfolio reduced in exchange for the

return to the utility of a payment adjustment to account for all undelivered RECs at the original

delivery level as of the time of the request.

These provisions will not apply to Traditional Community Solar projects and Public Schools projects

as the delivery and payment obligations for those projects under 20-year contracts is based on actual

delivery of RECs. Section 1-75(c)(1)(L)(iv) provides for adjustments to payments based on those

deliveries including the ability to carry forward higher than expected REC deliveries,

If generation of renewable energy credits during a delivery year exceeds the estimated

annual generation amount, the excess renewable energy credits shall be carried

forward to future delivery years and shall not expire during the delivery term. If

generation of renewable energy credits during a delivery year, including carried

forward excess renewable energy credits, if any, is less than the estimated annual

generation amount, payments during such delivery year will not exceed the quantity

generated plus the quantity carried forward multiplied by the contract price. The

electric utility shall receive all renewable energy credits generated by the project during

the first 20 years of operation and retire all renewable energy credits paid for under this

item (iv) and return at the end of the delivery term all renewable energy credits that

were not paid for.

7.13. Payment Terms

The Act provides a schedule of payments for RECs for projects. Section 1-75(c)(1)(L) of the IPA Act

as updated by Public Act 102-0662 specifies the following schedule for projects in categories other

than Traditional Community Solar and Public Schools projects: For systems up to 25 kW, “the

renewable energy credit delivery contract value shall be paid in full, based on the estimated

generation during the first 15 years of operation by the contracting utilities at the time that the

facility producing the renewable energy credits is interconnected at the distribution system level of

the utility and verified as energized and compliant by the Program Administrator.”

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Specific circumstances that constitute force majeure have been outlined and memorialized in the REC Contract.

Illinois Power Agency 2022 Long-Term Plan (Final) August 23, 2022

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For distributed generation systems greater than 25 kW and up to 5,000 kW and community solar

projects, “15% of the renewable energy credit delivery contract value, based on the estimated

generation during the first 15 years of operation, shall be paid by the contracting utilities at the time

that the facility producing the renewable energy credits is interconnected at the distribution system

level of the utility and verified as energized and compliant by the Program Administrator. The

remaining portion shall be paid ratably over the subsequent 6-year period.”

For Traditional Community Solar projects and Public Schools projects, the payment terms are not on

a set schedule, rather are for,

20 years and shall be paid over the delivery term, not to exceed during each delivery

year the contract price multiplied by the estimated annual renewable energy credit

generation amount. If generation of renewable energy credits during a delivery year

exceeds the estimated annual generation amount, the excess renewable energy credits

shall be carried forward to future delivery years and shall not expire during the delivery

term. If generation of renewable energy credits during a delivery year, including carried

forward excess renewable energy credits, if any, is less than the estimated annual

generation amount, payments during such delivery year will not exceed the quantity

generated plus the quantity carried forward multiplied by the contract price.

The Agency has established that the standard for being “energized” as used above must include the

completion of the interconnection approval by the local utility and the registration of the system in

GATS or M-RETS so that generation data can be tracked, and RECs created.

427

In addition, to avoid a

system being completed but RECs not created and delivered, before a system can be considered

“energized” so as to initiate the processing of an invoice for REC delivery contract payments,

automatic assignment of RECs to the applicable utility must be initiated. The Agency believes that by

ensuring proper registration in the tracking system up front, future administrative challenges can be

minimized.

For systems over 25 kW and community solar projects other than Traditional Community Solar, it is

not clear from the law how exactly the “subsequent 6-year period” would be calculated, and whether

the frequency of payments should be annually, quarterly, or monthly. The Agency proposed in the

Initial Plan (which featured a 20% upfront payment and subsequent payments over a 4-year period

based upon now changed provisions from Public Act 99-0906) that after the first payment of 20%,

the balance of payments be made on a quarterly basis over the following 16 quarters. For example, if

the first payment is made on September 30, 2019 (upon interconnection and energization), assuming

continued compliance with contractual requirements, the next payments would occur approximately

on December 31, 2019, March 31, 2020, etc., with the final payment on approximately September 30,

2023—resulting in 17 total payments that bookend a four-year period of time. Payment amounts

occur on a set schedule and may be adjusted to reflect changes in REC quantities (per Section 7.12.3),

or community solar subscription levels (per Section 7.11.4). Based on feedback received to date, the

Agency does not believe that a change to the basic quarterly payment schedule is warranted

(although the quarters of subsequent payments will increase to 24). However, the refreshed contract

427

This proposed standard is only intended to relate to the contractual payment terms for the Program. Section 1-75(c)(1)(K) specifies

that, “[o]nly projects energized on or after June 1, 2017 shall be eligible for the Adjustable Block program.” The Agency views this to mean

that a project must be interconnected to the applicable utility after June 1, 2017 and that the registration date of the system in GATS or M-

RETS does not impact that determination. The added contractual standard is meant to ensure that energized systems will produce the

RECs that they are receiving upfront payments for.

Illinois Power Agency 2022 Long-Term Plan (Final) August 23, 2022

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structure described in Section 7.14 that has been implemented now allows for three separate

quarterly delivery schedules to reduce the lag time between a project being approved for payment

and the first (or only) payment being received.

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Section 1-75(c)(1)(L)(vii) also requires that:

If, at any time, approved applications for the Adjustable Block program exceed funds

collected by the electric utility or would cause the Agency to exceed the limitation

described in subparagraph (E) of this paragraph (1) on the amount of renewable energy

resources that may be procured, then the Agency may consider future uncommitted

funds to be reserved for these contracts on a first-come, first-served basis.

The Agency will continue to carefully monitor project application approvals and available budgets.

Nevertheless, aside from waitlisted projects replacing defunct projects as already accounted for in

budget modeling, the Agency will not recommend Commission approval of contracts for additional

projects if it determines that contract obligations cannot be met through expected funds. The Agency

will endeavor to publish updates to available budgets and related information on regular intervals,

as discussed in Chapter 3 of this Plan.

7.14. Contracts

The Agency notes that while payments are made according to the terms described in Section 7.13,

the Adjustable Block Program and its REC delivery contracts feature ongoing performance

requirements to ensure that RECs are delivered across the 15 or 20-year term of the contracts,

especially after payments have been made under 15-year contracts. Section 7.12.1 describes in more

detail how those performance requirements have been implemented.

The Agency, in consultation with its Program Administrator and its Procurement Administrator,

developed a standard REC delivery contract between the utilities and Approved Vendors, much as its

Procurement Administrator had done for the competitive procurement processes. This included the

opportunity for interested parties to comment on the contract. The original REC delivery contract,

reflecting the consensus of the Agency, the utilities, and Commission Staff, was finalized in January

2019, just prior to the opening of the Adjustable Block Program for project applications. Once

finalized, that standard 2019 REC delivery contract was not subject to further negotiation for each

project or batch accepted into the Program.

For the First Revised Plan, the Agency proposed a substantial refresh of the standard delivery

contract based upon lessons learned from the execution and early administration of the initial

contracts. The Agency conducted stakeholder workshops in 2020 to review the contract structure

for the Adjustable Block Program, the Illinois Solar for All Program, and competitive procurements.

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Key issues that were considered included:

428

For example, a project approved for payment in January would be on a quarterly schedule of payments occurring in February, May,

August, and November; a project approved for payment in February would be on a quarterly schedule of payments occurring in March,

June, September, and December; and a project approved for payment in March would be on a quarterly schedule of payments occurring in

April, July, October, and January.

429

This process began on April 9, 2020 with the release of a request for stakeholder feedback. See:

https://ipa.illinois.gov/content/dam/soi/en/web/ipa/documents/updated-request-for-comments-due-dates-4-21-2020/il-abp-rec-

contract-request-for-comments-9-apr-2020-updated-due-date.pdf.

Illinois Power Agency 2022 Long-Term Plan (Final) August 23, 2022

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• Shortening and simplifying the REC Contract (and, if possible, synthesizing the contract into

a single set of terms and conditions)

• Clarifying contract default versus system default versus penalties

• Clarifying Product Orders, Master Contracts, and Portfolio-level responsibilities

• Termination for convenience (subject to applicable penalties)

• Measurement of community solar subscription levels

• Mechanism of collateral holdbacks

430

• Incorporation of Acknowledgement of Assignment forms

• Removal of a project from the contract

• Adoption of a measure providing for mediation by the IPA between utilities and Approved

Vendors in certain REC Contract disputes

431

Based on the workshops, the Agency worked with the Program Administrator, Procurement

Administrator, ICC Staff, and the utilities to develop a draft of a refreshed standard contract and

provided stakeholders the opportunity to comment on the refreshed contract. Based on comments

received from participants in the process, implementation of the refreshed REC contract was

deferred until new blocks were able to open—which occurred in December 2021 after the enactment

of Public Act 102-0662. For program reopening in December 2021, two versions of the contract were

released, one for projects under a 15-year REC delivery commitment, and one for projects under a

20-year REC delivery commitment. These two contract structures also incorporated changes

necessary to comply with provisions of Public Act 102-0662.

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The Agency expects that, as a result of the approval of this 2022 Long-Term Plan, the REC delivery

contracts may require additional updates. As of the filing of this Final Plan, a stakeholder feedback

process is underway to develop the revised contracts with input from the utilities, program

participants, ICC Staff, and other stakeholders.

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Revised contracts will be published by August 31,

2022.

Once any updated contracts are finalized and thus required to be used, Approved Vendors may

withdraw projects that had been submitted to the Program before the updated contract’s finalization

(that are not yet ICC-approved) with no penalty.

As the contract structure will be altered as a result of the above-mentioned process, the Agency

recommends that projects approved by the Commission after the contract finalization date would

use the new contract, regardless of application date. The Program will also provide an “off-ramp”

option for any already-applied projects expecting to be subject to the original 2019 REC Delivery

Contract rendered unable to be developed under the updated 2021 REC Delivery Contracts (although

this appears to be unlikely given the nature of modifications found in the updated contract).

430

This topic is discussed further in Section 7.10.6.

431

See Docket No. 19-0995, Final Order dated February 18, 2020 at 49.

432

See: https://illinoisabp.com/rec-contract/ for the current revised contracts and stakeholder comments related to their development.

This refreshed ABP REC contract also served as the basis for the contract that has been implemented for the fourth program year of Illinois

Solar for All.

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See https://illinoisabp.com/rec-contract/ for more details about that process.

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7.15. Annual Report

On an annual basis, each Approved Vendor is required submit an Annual Report of the contracts and

systems in its portfolio.

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The Annual Report serves as the basis for verifying that RECs from projects

are being delivered to the applicable utility, and, absent corrective actions taken by the Approved

Vendor, will be used to determine what actions should be taken by the utilities to enforce the

contractual requirements that RECs are delivered, including, but not limited to, drawing on collateral.

Additionally, the Annual Report will be used by the Agency to consider the ongoing eligibility of an

Approved Vendor to continue participation in the program.

For distributed generation systems, the report will include information on:

• RECs delivered by each of the systems in the portfolio

• Status of all systems that have been approved, but not yet energized, including any extensions

requested and granted

• Energized systems that have not delivered RECs in the year

• Balance of collateral held by each utility

• A summary of requests for REC obligations reductions due to force majeure events

• A summary of requests for REC obligations, suspensions, reductions, or eliminations due to

force majeure events

• Information on consumer complaints received

• Other information related to ongoing program participation, including use of graduates of job

training programs and other information related to increasing the diversity of the solar

workforce

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For community solar projects, the report will include those requirements listed above for distributed

generation projects and additionally:

• Percentage of each system subscribed on a capacity basis

• The number and type of subscribers (e.g., residential, small commercial, large

commercial/industrial), including capacity allocated to each type

• Subscriber turn-over rates

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The Agency will review the annual reports to assess compliance with the requirements of the

Adjustable Block Program and, if there are shortfalls of REC deliveries or subscription levels for

photovoltaic community renewable generation projects, will coordinate with the applicable utility

on what remedies should be taken, including drawing on collateral.

437

For this process and those

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Approved Vendors may request confidential treatment of the Annual Report. However, aggregated information from Annual Reports

may be publicly disclosed by the Agency to the extent that it does not disclose Approved Vendor-specific confidential information.

435

As discussed in the Commission’s Order approving the First Revised Plan, this requirement was added in order to learn from and

celebrate how the increase in solar development in Illinois is improving diversity in the state’s renewable energy workforce. The IPA

commits to gathering this information for informational purposes only. See Docket No. 19-0995, Final Order dated February 18, 2020 at

87.

436

The Commission specifically approved the inclusion of subscriber turnover rates in annual reports, noting that it will allow the IPA the

ability to make more informed decisions regarding community solar program requirements. See Docket No. 22-0231, Final Order dated

July 14, 2022 at 105-106.

437

The Agency will request on a semi-annual basis a report from each utility on RECs delivered by contract.

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described in the next two paragraphs, the performance evaluation and collateral draw methodologies

have been specified in the standard REC delivery contract.

For community solar projects, subscription levels must be maintained to remain eligible for REC

payments. If the annual report shows that subscriber levels on a rolling average basis have fallen

below the subscribership level that the project contractually committed to, then if REC payments are

still due, those payments will be reduced as described earlier in this chapter; if all payments have

been made, then the Agency will work with the applicable utility on what remedies should be taken

including drawing on collateral. If a project’s subscribership falls below 50% for a given delivery

year, no payment would be owed to the project for that delivery year, and a payment reduction or

collateral draw would result (although the project could regain 50% subscribership the following

year and qualify for payment in relation to that year).

A similar review will be conducted for projects that have received a small subscriber participation

adder but do not maintain sufficient levels of small subscriber participation. If small subscriber

participation levels are not maintained and there are remaining REC payments due, those payments

will be reduced (to either the actual small subscriber adder category that has been maintained, or to

remove the adder altogether if the level falls below 25%). If all payments have been made, then the

Agency will work with the applicable utility on what remedies should be taken including drawing on

collateral.

Approved Vendors will be given 90 days to cure any deficiencies found by the Agency and/or utilities,

and the failure to submit annual reports or cure deficiencies may carry consequences under REC

delivery contracts and/or result in disciplinary action under the Program.

In addition to the Adjustable Block Program Annual Report, Approved Vendors and Designees will

also be required to file an annual report related to their Equity Accountability Compliance Plan as

described in Section 10.1.1.3. As the Equity Accountability System does not launch until June 1, 2023,

the first report on the Equity Accountability Compliance Plan will not be due until July 15, 2024.

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8. Illinois Solar for All

8.1. Overview

The Illinois Solar for All Program (“ILSFA”) was created in 2017 through revisions to Section 1-56(b)

of the IPA Act contained in Public Act 99-0906 to “include incentives for low-income distributed

generation and community solar projects” with the following objectives:

bring photovoltaics to low-income communities in this State in a manner that maximizes

the development of new photovoltaic generating facilities, to create a long-term, low-

income solar marketplace throughout this State, to integrate, through interaction with

stakeholders, with existing energy efficiency initiatives, and to minimize administrative

costs.

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Public Act 99-0906 created four sub-programs within Illinois Solar for All, with incentives for each

type of development:

(A) Low-income Distributed Generation, for on-site solar projects

(B) Low-Income Community Solar, for off-site solar projects

(D) Low-Income Community Solar Pilot Projects, with distinct rules and incentives

The Act instructed the Agency to “include a description of its proposed approach to the design,

administration, implementation and evaluation of the Illinois Solar for All Program” in this Plan. The

Agency’s Initial Long-Term Plan fulfilled this requirement for the Illinois Solar for All Program, and

the Agency selected a Program Administrator and launched to program in early 2019.

While the price of photovoltaics has declined dramatically over recent years, there can be significant

upfront costs for the development of projects. The financial incentives offered through the Adjustable

Block Program may not be sufficient for low-income households and communities to overcome the

substantial barriers to participating in the growing solar energy market. The Illinois Solar for All

Program is an alternative approach and program to help address this challenge.

Public Act 102-0662, which took effect on September 15, 2021, updated the sub-programs that

comprise Illinois Solar for All, increased available funding, and prioritized expanding participation in

Illinois Solar for All to areas of Illinois previously underserved by the program, increasing

development by small and emerging businesses, and encouraging development of projects

promoting energy sovereignty.

The updates to the sub-program structure of Illinois Solar for All by Public Act 102-0662 eliminated

the Low-Income Community Solar Pilot Projects and split the Low-Income Distributed Generation

sub-program into separate sub-programs for distributed generation projects serving small

residential (single- to four-unit residences) and large residential (five units or more) buildings. The

Illinois Solar for All sub-programs under Public Act 102-0662 now consist of:

(A) Low-income Single-Family and Small Multifamily Solar

(B) Low-Income Community Solar

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20 ILCS 3855/1-56(b)(2).

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(D) Low-income large multifamily solar

The funding allocation percentages for these sub-programs were also adjusted, distributing the

funding no longer allocated for the Low-Income Community Solar Pilot Projects to the new

subprograms, with the Low-income Single-Family and Small Multifamily Solar and the Low-income

multifamily solar sub-programs sharing a funding allocation.

8.2. Existing and New Design Elements

In initially developing the program, the Agency identified two key design elements for implementing

the Illinois Solar for All Program that needed more focused discussion: the relationship to the

Adjustable Block Program, and the creation of “tangible economic benefits” for participants. With the

new provisions contained in Public Act 102-0662 the Agency has expanded its consideration of key

design elements to also include small and emerging business development and energy sovereignty.

8.2.1. Relationship with the Adjustable Block Program

The goals of the Illinois Solar for All Program overlap with the goals of the Adjustable Block Program

in that both promote distributed photovoltaic generation and community solar. The differences

primarily involve the sectors that the programs serve, the structure of the incentives and program

design, and the applicable funding sources.

As described in this Chapter, the Agency administers the Illinois Solar for All Program separately

from the Adjustable Block Program, but it is built off of the program design of the Adjustable Block

Program, with additional considerations specific to Illinois Solar for All. These include a different

level of incentives, additional requirements to be an Illinois Solar for All Approved Vendor, additional

project application requirements, Illinois Solar for All specific contracts, and additional

considerations to ensure community involvement, consumer protections, and eligibility. To the

extent not specifically mentioned in this Chapter, the program design, terms, and conditions of the

Adjustable Block Program also apply to the administration of, and REC delivery contracts executed

under, the Illinois Solar for All Program.

Many of the fundamental aspects of the Illinois Solar for All Program are identical, or at least similarly

structured to the Adjustable Block Program, as detailed in Chapter 7 of this Plan. For example, as in

ABP, projects located on a single parcel are considered co-located, which influences determination of

system size and eligible REC prices (Section 7.5.5). To ensure program funds go to entities that have

been properly vetted and commit to compliance with program terms, Illinois Solar for All accepts

applications from program Approved Vendors, just as in ABP (Section 7.7). In order to qualify to

apply to be an Illinois Solar for All Approved Vendor, the developer must register and maintain their

status as an Approved Vendor with the Adjustable Block Program (Section 7.7.2). Entities that are

not interested in entering into REC contracts as Approved Vendors but are subcontracted to work on

ILSFA projects must register as Approved Vendor Designees (Sections 7.8 and 7.8.1). Additional

requirements to qualify as an Illinois Solar for All Approved Vendor are found below in Section 8.9.

As with the Adjustable Block Program, Illinois Solar for All projects must meet technical and metering

system requirements (Section 7.9.1 ad 7.9.2) as well as the same basic consumer protection

requirements found in Chapter 9, with additional consumer protection requirements for Illinois Solar

for All participation detailed below in Section 8.11.

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The requirements for a project to participate as a community solar project follow the framework

outlined in Sections 7.9.6, 7.9.6.1, 7.9.6.2, and 7.9.6.3, while providing the additional participant

savings and consumer protections detailed in this chapter.

As in Section 7.10, there is an application process for the submission of projects to the Illinois Solar

for All program:

• Projects are submitted in batches (7.10.1),

• Are reviewed by the Program Administrator (7.10.4),

• Have the anticipated quantity of RECs generated by the system over the contract term

calculated (7.10.5), and,

• If in compliance with program requirements and selected, are submitted to the ICC for final

approval (7.10.6).

Following ICC approval, REC contracts are:

• Executed by the Approved Vendor and the contract Buyer for the RECs produced by the

project (7.12).

• Project construction is completed (if it wasn’t already) and must submit confirmation of

utility energization and document final project details within a given deadline (7.11.1).

• If an Approved Vendor is unable to meet a project’s given deadline, the REC contract provides

options for requesting extensions to the deadline for meeting contract energization

requirements (7.11.2)

• Once an Approved Vendor has provided the Program Administrator the required

documentation to confirm project completion and energization by the utility, the project can

be approved for payment (7.11.3).

• RECs generated by the project are delivered to the contract Buyer through irrevocable

Standing Order and reported to the Program Administrator regularly through an Annual

Reporting process (7.15).

• A collateral payment is required from the Approved Vendor Performance to ensure REC

deliveries requirements are met for the duration of the REC contract (Section 7.12, 7.12.1,

and 7.12.2).

• Following approval for payment, the Approved Vendor invoices the Buyer for payment on a

schedule determined by the project type as outlined below.

Illinois Solar for All Approved Vendors must maintain status of good standing in the Adjustable Block

Program as well as the Illinois Solar for All program, which includes submission of Annual Reports of

REC deliveries and other program metrics for each program (7.15). The details and any differences

in how these concepts are implemented within the Illinois Solar for All program are detailed further

in the Illinois Solar for All Approved Vendor Manual.

8.2.2. Tangible Economic Benefits

The second consideration is the concept of “tangible economic benefits” and how low-income

participants can capture them. Section 1-56(b)(2) of the Act stipulates that the Illinois Solar for All

Program should “ensure tangible economic benefits flow directly to program participants."

The requirement that low-income program participants receive tangible benefits carries into the

parameters of the contracts executed within the Illinois Solar for All Program as well. Section 1-

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56(b)(2) also requires that “[e]ach contract that provides for the installation of solar facilities shall

provide that the solar facilities will produce energy and economic benefits, at a level determined by

the Agency to be reasonable, for the participating low-income customers.”

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In addition, contracts

should “ensure [that] the wholesale market value of the energy is credited to participating low-

income customers or organizations and to ensure tangible economic benefits flow directly to

program participants, except in the case of low-income multi-family housing when the low-income

customer does not directly pay for energy.”

440

For the purposes of this chapter the term “multi-

family” applies to residential buildings with five or more units.

A key barrier to low-income participation in renewable energy programs is lack of access to funds

and financing to pay for the up-front costs of photovoltaic systems.

To create “tangible economic benefits” at a “reasonable” level, the Agency has determined that

eligible residential participants in the Illinois Solar for All Program should not have to pay up-front

costs for on-site distributed generation or pay an up-front fee to subscribe to a community solar

project.

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Further, participation in the program should result in immediate, reliable reductions in

energy costs for those residents or subscribers. Consistent with the Commission’s Order in Docket

No. 17-0838, this means that for projects that are financed or leased, any ongoing annual payments

must be smaller than 50% of the annual first year estimated production and/or utility default service

net metering value to be received by the customer.

442

The Agency will implement two exceptions to this no up-front costs standard. The first exception is

for Low-income large multi-family solar initiative projects (multi-family projects of five or more

units) where the participant purchases the system. In this case, the residential participant’s first-

year savings may be less than 50% so long as the calculation of that customer’s expected ongoing

savings demonstrates that this requirement would be met through overall savings applied across the

full 15 years of the REC delivery contract. The second would be to allow low-income community solar

projects that are organized as cooperatives to promote energy sovereignty to charge a nominal fee

to join the cooperative. The Agency will establish a methodology for setting a cap on up-front fees for

low-income members of such cooperatives after conducting a stakeholder feedback process to solicit

public input on potential methodologies.

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The Agency requires that Illinois Solar for All Approved Vendors verify that developers, installers,

landlords, and other intermediaries ensure that the resulting value of the incentives offered by the

program flow through to the people the program is meant to serve. However, the Agency notes that

in order to avoid an overly complex administrative system, incentive levels are not customized to

each participant’s specific economic circumstances.

439

20 ILCS 3855/1-56(b)(2).

440

Id.

441

This requirement does not apply to multi-family buildings with more than five units, or projects in the non-profit/ public facilities sub-

program.

442

See Docket No. 17-0838, Final Order dated April 3, 2018 at 151. As required by the Commission’s Order, this calculation must be

“disclosed to the customer and reviewed and approved by the Agency.”

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This change reflects a request for clarification in the Long-Term Plan litigation regarding whether the Agency will set a single fee cap or

whether the cap will change based on the project. The Commission’s Order approved the Agency’s proposed solution of clarifying that the

IPA will set a methodology, not a single number, for the fee cap and that it will seek stakeholder feedback on that methodology. See Docket

No. 22-0231, Final Order dated July 14, 2022 at 110.

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For public and non-profit facilities that participate in the Illinois Solar for All Program, the Agency

will continue to utilize an incentive level that recognizes that these entities may not be able to capture

the tax benefits that would be available to a comparable sized project participating in the Adjustable

Block Program.

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The higher REC price offered by the Illinois Solar for All Program can help

overcome the financing barriers that certain non-profits and public facilities may face compared to

private entities. The Agency observes that over 180 non-profit and public facility projects (exceeding

60 MW of capacity) applied to the Adjustable Block Program in its initial blocks, indicating that many

such projects are viable at the REC prices offered by that program.

In order to account for these additional tax benefits, in the First Revised Plan the Agency proposed

that Illinois Solar for All Approved Vendors submitting projects for non-profit or public facilities that

can utilize the federal Investment Tax Credit under 26 U.S.C. § 48 will be required to demonstrate

additional value to the project host. The Agency maintains that approach for this 2022 Plan, as

discussed further in Section 8.5.6 below.

Existing net metering provisions ensure that “the wholesale market value of energy is credited to

participating low-income customers.” Therefore, projects are required to participate in the

applicable utility’s or ARES’s net metering program. This may prevent projects in the service territory

of a municipal utility or rural electric cooperative that does not offer net metering from participating

in the Illinois Solar for All Program. The Agency hopes that such municipal utilities and rural electric

cooperatives strongly consider adopting net metering policies to bring the full value of solar to their

residents and members.

Approved Vendors may demonstrate that they are ensuring that tangible economic benefits flow

directly to program participants by providing documentary evidence to the Agency that: a project on

a one to four-unit residential building has no upfront cost to the residential participant, except in

cases of system purchases; that incentives are used by the project developer/installer to offset costs

to the participant; and that there will not be ongoing costs or fees to the participant that exceed 50%

of the value of energy produced. The resulting economic benefits to program participants will be

accrued through the value they receive through net metering or avoided consumption from the

energy the system produces. As described in Section 8.2.2, Illinois Solar for All Approved Vendors are

required to document how they ensure that this goal is met. The case of low-income multi-family

housing can be more complex and is discussed in more detail in Section 8.5.4.3.

It should be noted that program incentives are tied directly to creating economic benefits through

lowered net energy costs and are calculated in that manner. As a result, there may be additional costs

required to make a specific project viable (e.g., costs associated with roof repairs or wiring upgrades)

that these incentives may not be able to address. Additional incentives to pay for those types of costs

are generally not available through the Illinois Solar for All Program, but the Agency encourages

participants to explore alternative sources of funding as needed. For example, Public Act 102-0662

creates a number of new initiatives administered by other state agencies such as the Department of

Commerce and Economic Opportunity and the Illinois Finance Authority as described further in

Section 8.8. The Agency and the Illinois Solar for All Program Administrator will also work with

Illinois Solar for All Approved Vendors to facilitate informing and educating program participants

about opportunities that may be available to them through utility-administered energy efficiency

programs, weatherization assistance programs, lead abatement programs, building repair and

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See "Appendix E at “CREST Inputs” tab, cell G73.

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upgrade programs, and other forms of support. This includes the provision of a Program Resource

Guide on those programs.

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As described in Section 8.5.3.3, the Agency will implement a pilot to test

how incentives within Illinois Solar for All could be adjusted in certain circumstances to account for

the cost of repairs. This pilot will compare the effectiveness of this approach to harnessing separate

funding opportunities.

Additionally, in order to facilitate the direct flow of tangible economic benefits to low-income

residential participants, the Agency and its Illinois Solar for All Program Administrator engaged the

United States Department of Housing and Urban Development (“HUD”) for guidance that would

clarify the treatment of Illinois Solar for All benefits with regard to cost allowance-based low-income

housing programs. Subsequent to the filing of this Plan with the Commission for approval, HUD

provided guidance for consideration of community solar credits that ensures HUD program

participants residing in individually metered properties in Illinois will not see a rent increase or

utility allowance adjustment. This guidance was announced on the Illinois Solar for All website.

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The Agency expects that HUD will issue additional guidance on solar credits from on-site distributed

generation.

8.2.3. Small and Emerging Business Development

Public Act 102-0662 included a number of provisions aimed at encouraging business development.

Section 1-56 (b)(2) now requires the Agency to "make every effort to ensure that small and emerging

businesses, particularly those located in low-income and environmental justice communities, are

able to participate in the Illinois Solar for All Program" and to report on progress annually.

While the Act does not define “small and emerging” business, other state and federal programs have

provided definitions for “small business.” The Illinois Business Enterprise for Minorities, Women,

and Persons with Disabilities Act promotes “open access in the awarding of State contracts to

disadvantaged small business enterprises victimized by discriminatory practices.”

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Eligible small

businesses have annual gross sales of less than $75,000,000.

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The Small Business Set-Aside

Program of the Illinois Department of Central Management Services reserves certain types of state

procurement contracts for small businesses. According to the Department:

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• “A small business means one that is independently owned and operated, is not dominant in

its field or operation, and meets the required size status and the following sales limitations:

….

• No CONSTRUCTION business can exceed $14 Million in annual sales and receipts.

• No MANUFACTURING business can employ more than 250 persons."

The federal definition of a small business varies by industry. For example, the US Small Business

Administration (SBA) considers Electrical Contractors and Other Wiring Installation Contractors

445

See: https://www.illinoissfa.com/app/uploads/2019/03/ILSFA-Program-Resources-Guide-v1-20190318.pdf.

446

See: https://www.illinoissfa.com/announcements/2022/08/u-s-department-of-housing-and-urban-developments-determination-on-

illinois-solar-for-alls-community-solar-net-metering-credits/.

447

30 ILCS 575/1.

448

Id. at (2)(a)(10).

449

State of Illinois, Chief Procurement Office, website, accessed January 10, 2022.

https://www2.illinois.gov/cpo/general/Pages/Sell2Illinois.aspx

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(NAICS code 238210) that have annual revenues of less than $16.5 million

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as small for federal

contracting purposes. To help small and emerging businesses participate in the Illinois Solar for All

Program, the Agency will use the federal SBA definition of “small,” based on annual revenues within

the appropriate NAICS category.

Definitions of an “emerging” business vary widely by jurisdiction and may include factors such as the

novelty of the business or the industry, the duration of operations, revenues or number of employees,

or whether the majority owner is in a category of people that has suffered discrimination in the past.

The Agency defines “emerging business” as a business that has been authorized to do business in any

US state for less than three years.

Public Act 102-0662 also creates a number of job training and business development programs, as

discussed in more detail in Section 8.8.1. While many of these programs focus on technical skills, the

Agency sees a need for business training, especially around efforts to encourage Small and Emerging

Businesses, energy sovereignty, and community-driven solar projects. Ownership and management

of projects requires skills in finance, permitting, regulations, community engagement, marketing,

customer acquisition and management, and other topics. Two of the DCEO programs, the Clean

Energy Contractor Incubator Program and Clean Energy Primes Contractor Accelerator Program, do

include business development activities. The Agency encourages DCEO and stakeholders to consider

the need for business training around ownership and management of solar projects. Such a program

could be supported by or integrated with the Community Solar Energy Sovereignty Grant Program.

8.2.4. Energy Sovereignty

Public Act 102-0662 introduces a new concept for the Illinois Solar for All program, that of energy

sovereignty.

Section 1-56(b)(2)(A)(i) requires the Agency to reserve “a portion” of Illinois Solar for All funding

“for projects that promote energy sovereignty through ownership of projects by low-income

households, not-for-profit organizations providing services to low-income households, affordable

housing owners, community cooperatives, or community-based limited liability companies

providing services to low-income households.”

The Act identifies several potential factors that create energy sovereignty, such as “that local people

have control of the project and reap benefits from the project over and above energy bill savings.”

Eligible energy sovereignty projects can “promote ownership over time” or “involve partial project

ownership by communities.” The Act also permits the Agency to set higher incentive levels for

projects within ILSFA that promote energy sovereignty than for those that do not.

While the law does not define “energy sovereignty,” Section 1-56(b)(2)(A)(i) refers to two concepts

in relation to energy sovereignty. First, it envisions “ownership of projects by low-income

households, not-for-profit organizations providing services to low-income households, affordable

housing owners, community cooperatives, or community-based limited liability companies

providing services to low-income households; second, it seeks to ensure that “local people have

control of the project and reap benefits from the project over and above energy bill savings.”

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See Small Business Association “size standards” at https://www.sba.gov/federal-contracting/contracting-guide/size-standards.

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Section 1-56(b)(2) does not define “ownership,” but Section 1-75(c)(1)(K)(v) defines "community

ownership" as “an arrangement in which an electric generating facility is, or over time will be, in

significant part, owned collectively by members of the community to which an electric generating

facility provides benefits; members of that community participate in decisions regarding the

governance, operation, maintenance, and upgrades of and to that facility; and members of that

community benefit from regular use of that facility.” While not directly applicable to programs in

Section 1-56(b), this definition can provide guidance for the Agency in setting a standard for

“ownership” within the Illinois Solar for All Program. This definition points to the ability of “owners”

to participate in decisions regarding the operations and management of the facility and to benefit

from using the facility. For Low-income Single and Small Multifamily Distributed Generation, being

the sole or majority owner of the solar installation would create such abilities. For Low-Income Large

Multifamily Distributed Generation and Low-Income Community Solar, see below for factors that the

Agency will consider as supporting energy sovereignty.

The second concept included in Section 1-56(b)(2)(A)(i) as an element of energy sovereignty in fact

contains two factors. First, “that local people have control of the project,” and second, that they “reap

benefits from the project over and above energy bill savings. The simplest interpretation of “control”

is the ability to determine the use and management of the facility, including operations and

maintenance, finance and revenues, and other managerial matters. Broader interpretations of

“control” include a greater sense of “energy democracy" such as “interdependence, conservation,

wealth-building, political autonomy, and economic opportunity."

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Likewise, benefits “over and

above energy bill savings” flow largely from ownership, such as self-reliance, income and wealth

building. Local communities may also experience other benefits, such as pollution reduction and

property tax base, with or without local ownership. (See Appendix G for a full discussion of energy

sovereignty.)

The Agency believes that majority or full ownership by individuals or community institutions listed

by Section 1-56(b)(2)(A)(i) is the most direct way to ensure that local people will have control over

and reap the benefits from photovoltaic energy projects. The Agency originally proposed to define

“energy sovereignty” as the eligible low-income household or community organization having or

being on a defined path to majority or full ownership of the photovoltaic facility. After consideration

of stakeholder comments and per the Commission’s Order approving this Plan, the Agency adopts

the following definition of “energy sovereignty” for the Illinois Solar for All program:

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“Energy sovereignty” means the eligible low-income household or community

organization having or being on a defined path to majority or full ownership of the

photovoltaic generating facility or, in the case of a cooperative or community

ownership model, a share or membership in the entity that owns the photovoltaic

generating facility. For the purpose of this definition, “ownership” means not only

legal title to the property but also the right to participate in decisions regarding the

governance, maintenance, and use of the facility and to benefit from the use of that

facility. For the purpose of this definition, “photovoltaic generating facility” means

any equipment that generates electricity from solar energy. If the project includes

associated energy storage equipment, the eligible low-income household or

451

Chelsea Schelly, et al, “Energy policy for energy sovereignty: Can policy tools enhance energy sovereignty?”

(https://digitalcommons.mtu.edu/michigantech-p/2066/) Solar Energy 205 (2020) 109–112.

452

See Docket No. 22-0231, Final Order dated July 14, 2022 at 110.

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community organization is not required to, but may, own such storage equipment to

qualify as an “energy sovereignty” project.

Discussion of the various business and ownership models that might qualify follows below, and

Section 8.5.1 offers further detail regarding eligibility to be considered an energy sovereignty project

and the associated program benefits.

The Agency recognizes that low-income households may encounter a number of barriers to

ownership of both distributed generation and community solar projects. Low-income households

may lack savings to buy systems outright, they may not have a credit score high enough to enable

financing, they may not own their dwelling, and their home may need electrical or structural

upgrades to enable installation of solar.

A further impediment—for individuals, non-profits, public agencies, schools, and others—is the

structure of federal tax incentives. Investments in community solar are eligible for the Section 48

investment tax credit and accelerated depreciation,

453

which can only be applied against taxes on

passive (investment) income.

454

The Section 25D residential solar tax credit,

455

for rooftop solar

panels, is claimed against income tax, but cannot be refunded to taxpayers with insufficient taxable

income. As a result, solar projects often require a “tax equity” partner who can monetize federal tax

credits and depreciation. This combination of incentives can be worth over 40% of the upfront

investment in a commercial solar project.

456

To attain ownership, the tax equity partner or third-

party owner (“TPO”) can sell or “flip” ownership to the other party after 5-7 years, when the main

financial incentives have been captured. The details and mechanisms vary for the two types of

deployment: on-site solar or remote community solar.

457

On-site systems are either owned by the customer and financed using a cash purchase or a loan, or

they are owned by a TPO with the system leased to the customer or the power sold to the customer

through a power purchase agreement (“PPA”).

458

In the Illinois Solar for All Program to date, most

Low-income Distributed Generation installations have been leased to eligible customers. A common

method of transferring ownership in such circumstances is an early buyout (“EBO”) of a lease or PPA.

Community solar projects are typically owned by a for-profit developer, often in conjunction with a

tax equity partner who is able to take advantage of federal incentives. This partnership sells

subscriptions to customers, but usually retains ownership. Alternative models that would lead to

greater community ownership and control could include: ownership by local businesses or investors

with sufficient tax appetite to monetize incentives; by local non-taxable entities such as

governments, community choice energy aggregators, non-profit businesses or organizations, and

cooperatives, in conjunction with a tax equity partner; or, by a for-profit (and taxable) subsidiary of

453

26 U.S.C. §48.

454

Congressional Research Service, “Tax Equity Financing: An Introduction and Policy Considerations,” report number R45693, April 17,

2019. https://www.everycrsreport.com/reports/R45693.html.

455

26 U.S.C. §25D.

456

Keith Martin, Norton Rose Fulbright, “Partnership flips: Structures and issues,” February 18, 2021.

https://www.projectfinance.law/publications/2021/february/partnership-flips/.

457

After the Commission’s approval of this 2022 Plan, Congress passed the Inflation Reduction Act legislation, which includes several

changes to federal tax credits for solar installations. The Agency is still reviewing these changes to see how they might impact financing for

energy sovereignty projects.

458

Nate Hausman, Clean Energy States Alliance, “A Homeowner’s Guide to Solar Financing: Leases, Loans and PPAs,” November 28, 2018.

https://www.cesa.org/resource-library/resource/a-homeowners-guide-to-solar-financing-leases-loans-and-ppas/.

Illinois Power Agency 2022 Long-Term Plan (Final) August 23, 2022

229

a non-profit entity, created specifically to own the solar project; or by some combination of partners.

As with distributed generation, a transfer of ownership after 5-7 years would enable ownership of

community solar by a community organization.

For ownership of community solar by individuals, two strategies are currently being applied in the

United States: owning shares in a community solar cooperative

459

or owning parts of a community

solar installation.

460

Individuals could also own shares in a corporation that owns a community solar

project. But creating a corporate structure that complies with Securities and Exchange Commission

regulations on public ownership can be an onerous financial burden for what would be a small

company. The Agency will conduct a stakeholder engagement process to identify various ownership

models for community solar projects and incorporate that feedback into eligibility guidelines for

community solar projects to qualify as promoting energy sovereignty.

461

Related to the Agency’s consideration of models for energy sovereignty, Public Act 102-0662 enacted

the Energy Transition Act, which established the Community Solar Energy Sovereignty Grant

Program (Section 5-60 of the Energy Transition Act), to be administered by DCEO. The Sovereignty

Grant Program shall support “applicants that best demonstrate the ability and intent to create

community ownership and other local community benefits, including local community wealth

building via community renewable generation projects.” The Agency recognizes the potential for

positive interactions between this Grant Program and the Illinois Solar for All Program and will work

with DCEO to maximize such benefits.

8.3. Program Launch and Experience to Date

In implementing the various new programs and procurements mandated by Public Act 99-0906 (and

now updated by Public Act 102-0662), the Agency had a large and varied set of new tasks to

undertake. The Agency appreciates the strong interest in the Illinois Solar for All Program and desire

to make the benefits of the Program available to low-income households and communities so that

they can benefit from lower energy costs. The Illinois Solar for All Program as originally proposed in

Public Act 99-0906 mostly builds on the Adjustable Block Program described in Chapter 7; therefore,

it was necessary to first have the Adjustable Block Program’s design finalized and put into operation

before the Illinois Solar for All Program launched. Like with the Adjustable Block Program, while the

Initial Plan and First Revised Plan detailed many programmatic considerations, final program design

including contracts, program manuals, etc. needed to be developed and finalized by the Agency and

the Illinois Solar for All Program Administrator(s) prior to program launch.

459

Customers would own shares in a community solar cooperative or corporation. Cooperative Energy Futures (“CEF”) in Minnesota has

950 member-owners and owns 6.9 MW of solar in eight projects. Members pay $25 to join the co-op, and can subscribe to take solar

electricity via virtual net metering. They can also participate in energy efficiency programs or buy preferred stock in the co-op when it is

offered. Like a standard solar company, the co-op teams up with a tax equity partner to capture tax benefits, with majority ownership then

flipped to the co-op, in effect managing tax issues for its customer/owners.

460

Customers can own solar panels in a community solar project. This approach is being used by a community solar cooperative in the

Northeast US, Co-Op Power, and by publicly-owned utilities in Colorado and Kansas. In this case, the customer buys and owns the panels

and is responsible for monetizing tax credits, selling or retaining renewable energy credits (in some states), and paying the project manager

for system operations and maintenance. The customer gets the value of the electricity as a bill credit and can sell ownership in their panels

to other utility customers or co-op members. Owning the panels directly requires individual owners to be able to use the tax credits, which

may be an impediment for low-income customers. However, that model could also include a taxable partner and a transfer of ownership,

such as through a lease with an early buyout option.

461

See Docket No. 22-0231, Final Order dated July 14, 2022 at 110.

Illinois Power Agency 2022 Long-Term Plan (Final) August 23, 2022

230

In November 2018, the Agency and Program Administrator initiated a series of stakeholder

engagement sessions to share draft program details with the public and invite written feedback,

which was considered in planning the implementation of the Illinois Solar for All Program.

Stakeholder feedback sessions were held on a number of topics, including Environmental Justice

Communities, Job Training, Approved Vendor Registration, Grassroots Education, Third Party

Program Evaluation, Consumer Protection, and Project and Participant Eligibility. These

opportunities to engage the public helped ensure that the process of finalizing program protocols

and requirements was transparent and responsive to input from stakeholders from the solar

industry, environmental advocates, and low-income advocates.

The program began accepting applications for registering Illinois Solar for All Approved Vendors on

February 19, 2019, and opened for project applications on May 15, 2019. Due to anticipated high

interest in the program’s incentives for new low-income solar installations, the program launch

included an initial project application window for the 2018-2019 program year of 30 days for Low-

Income Community Solar projects and 45 days for Low-Income Distributed Generation and Non-

Profit/Public Facilities projects. Forty-five Low-Income Community Solar applications (totaling

nearly 60 MW of capacity), 28 Non-Profit/Public Facilities applications (totaling over 3 MW of

capacity), and one Low-Income Distributed Generation application (2 MW of capacity) applied during

that initial window. The applications for Low-Income Community Solar and Non-Profit/Public

Facility projects exceeded allocated sub-program budgets for the program year, while the Low-

Income Distributed Generation sub-program featured application levels below the allocated sub-

program budget. Five Low-Income Community Solar projects (totaling 4 MW of capacity), and seven

Non-Profit/Public Facility projects (1.3 MW of capacity) were selected. The community solar projects

were selected using the project selection protocol (as discussed further in Section 8.10.2) while all

the eligible Non-Profit/Public Facility projects were selected (the volume of project applications in

that sub-program dropped below the annual sub-program budget after some were deemed ineligible

during review). The one distributed generation applicant project withdrew. In the latter two sub-

programs, unused 2018-2019 sub-program budget was rolled over to the respective 2019-2020 sub-

program budget.

For the 2019-2020 Program Year, 30 Low-Income Community Solar projects (54.5 MW), 20 Non-

Profit/Public Facilities projects (2.7 MW), and 11 Low-Income Distributed Generation projects (2

MW) applied during the initial project application window. Eligible applications for Low-Income

Community Solar projects exceeded the allocated sub-program budget for that program year, so the

project selection protocol was executed for the Low-Income Community Solar sub-program. Four

community solar projects were selected (totaling 4 MW of capacity). The Non-Profit/Public Facilities

sub-program reopened on October 25, 2019 for rolling project applications and closed on February

26, 2020 after 24 projects (totaling 2.8 MW of capacity) were approved for the program year.

Applications for the Low-Income Distributed Generation sub-program did not fill the available

budget and that sub-program reopened for rolling project applications on October 1, 2019. One

multi-family (2 MW) and nine single-family distributed generation projects (totaling 58 kW) were

approved by the ICC before the program closed on May 31, 2020.

For the 2020-2021 Program Year, 17 Low-Income Community Solar projects (over 35 MW), 33 Non-

Profit/Public Facilities projects (4.9 MW), and 7 multi-family unit (0.354 MW) were submitted during

the initial project application windows. Eligible applications for Low-Income Community solar

projects exceeded the allocated sub-program budget for the program year, so the project selection

Illinois Power Agency 2022 Long-Term Plan (Final) August 23, 2022

231

protocol was executed for the Low-Income Community Solar program. Three community solar

projects were selected (totaling 4.5 MW of capacity). Eligible applications for the Non-Profit/Public

Facilities sub-program also exceeded the allocated sub-program budget for the program year, so the

project selection protocol was executed and 18 projects (2.4 MW) were selected, and an additional

project (0.3 MW) from the waitlist was able to be approved when funding was made available

following a project withdrawal from the program. Again, applications for the Low-Income

Distributed Generation sub-program did not fill the available budget and reopened for rolling project

applications on July 20, 2020. A total of nine multi-family units (0.424 MW) and 53 single-family

distributed generation projects (0.295 MW), totaling 0.719 MW, were approved by the ICC before the

program year closed on May 31, 2021.

Figure 8-1: ILSFA Program Years 1-3 Project Applications and Selections

Illinois Solar For All applications submitted and selected for program years 1-3 (2018-19 through 2020-

21)

For the 2021-2022 Program Year, 162 Distributed Generation Projects totaling 1,321.71 kW (160

single-family and small multifamily, and 2 5+ unit multifamily) applied before the program year

ended on May 31, 2022. Forty-eight Non-Profit/Public Facilities Projects (5.8 MW) applied during

the initial application window and eligible applications exceeded the allocated sub-program budget

for the program year. Project selection occurred on August 11, 2021 and 20 Projects (2.4 MW) were

selected (two projects had incentive values larger than the remaining funds and needed to resize

their projects or accept a lesser incentive value, and one eventually withdrew). All twenty of those

projects were approved by the ICC, although three withdrew after ICC approval, leaving a total

capacity of 2.1 MW in the 17 remaining approved projects. Ten projects on the waitlist that were

eligible for the additional funding, and all were approved by the ICC, but one of those later withdrew.

A rolling submission window opened on March 21, 2022 to provide an opportunity for additional

Non-Profit/Public Facilities projects to be submitted to utilize the additional Utility funding made

available by Public Act 102-0662, described in Section 8.4.3. Seventy-two total Non-profit/Public

Facilities projects were submitted and 41 were found eligible and approved by the ICC for a total of

5.619 MW. The program year application window for low-income community solar project

applications opened on August 23, 2021. Thirteen projects (16.8 MW) were submitted, and eligible

Illinois Power Agency 2022 Long-Term Plan (Final) August 23, 2022

232

projects exceeded the allocated sub-program budget. Project selection was conducted on October 27,

2021 resulting in the selection of three projects (4.4 MW), which were approved by the ICC on

November 18, 2021. Two projects withdrew, each at 1,950 kW, and the remaining project is 500 kW.

Six projects were on the waitlist and were eligible for the additional funding described in Section

8.4.3. Five of those projects (6.905 MW) were approved by the ICC. In total, 6 community solar

projects totaling 7.405 MW were approved and funded within the Program Year.

8.4. Funding and Budget

The Illinois Solar for All Program is funded through three sources. First, the Renewable Energy

Resources Fund pursuant to Section 1-56(b)(2) of the IPA Act; second, funds from the renewable

energy resources budgets of the utilities pursuant to Section 1-75(c)(1)(O) of the IPA Act; and third,

potential additional funds from the renewable resources budgets of the utilities pursuant to Section

16-108(k) of the Public Utilities Act.

8.4.1. Funding

Section 1-56(b)(2) envisions the Illinois Solar for All Program being funded through the state-held

Renewable Energy Resources Fund and from the utility RPS budgets. As of August 23, 2022, the

balance of the Renewable Energy Resources Fund is $128,888,591,

462

while existing commitments

from the Fund for contracts from the Supplemental Photovoltaic Procurements total $2.5 million

463

and for Illinois Solar for All from the first three program years, $47.7 million. This implies $78.7

million of RERF funds remain available for Illinois Solar for All. Prior to the 2018-2019 program year

(i.e., at the outset of the Program), before the Agency had paid any administrative costs to its Program

Administrator, $150.0 million of RERF funds were available for Illinois Solar for All; this is the figure

the Agency will use in this Section in explaining sub-program allocations from the RERF.

Prior to the enactment of Public Act 99-0906, the Renewable Energy Resources Fund received

Alternative Compliance Payments each fall from Alternative Retail Electric Suppliers as part of their

RPS compliance obligations. Under the revisions to Section 16-115D of the PUA contained in Public

Act 99-0906, those payments were no longer made to the Fund as of June 1, 2017; rather, they were

now made to the utilities, and were be paid to the utilities through Fall 2019.

464

With those payments

no longer being made into the RERF, there is no new revenue that will be deposited into the Fund.

The RERF’s previously lower balance was due to the fact that on August 10, 2017, $150 million was

transferred from the Renewable Energy Resources Fund to the General Revenue Fund pursuant to

the borrowing provisions contained in Section 5h.5 of the State Finance Act.

465

Thirty-seven and a

half million dollars was paid back into the RERF in April of 2019,

466

and the remainder of borrowed

funds are required by law to be paid back to the Renewable Energy Resources Fund within five years

462

This balance reflects the repayment of funds that had been lent to the state’s General Revenue Fund and Health Insurance Reserve

Fund, as discussed below.

463

The commitments consist of REC delivery contracts previously entered into and are being paid, or will be paid, over a five-year REC

delivery schedule (invoiced quarterly) depending on when individual systems under contract were completed and began REC deliveries.

464

See 220 ILCS 5/16-115D(i); after May 31, 2019, the ARES will no longer have any future Alternative Compliance Payment obligations,

although “alternative retail electric suppliers and electric utilities operating outside their service territories shall be obligated to make all

alternative compliance payments that they were obligated to pay for periods through and including May 31, 2019, but were not paid as of

that date.” Those payments are due to by September 1, 2019.

465

30 ILCS 105/5h.5(b).

466

https://illinoiscomptroller.gov/financial-data/state-revenues/by-

fund/?FundSel=0836&FundGrpSel=&FundCatSel=&FundTypeSel=&GroupBy=Agcy&FY=18&ShowMo=Yes&submitted.

Illinois Power Agency 2022 Long-Term Plan (Final) August 23, 2022

233

(i.e., by August 10, 2022).

467

As described above, two additional transfers of $10 million were also

made in 2020 under this same authority. Repayments into the Fund have been made including $4

million in September 2021, $10 million in December 2021, $10 million in January 2022, and the

remaining balance of $108.5 million in March 2022.

Section 5h.5(b) contains a provision that when the RERF (or for that matter other state funds that

had similar transfers),

ha[s] insufficient cash from which the State Comptroller may make expenditures

properly supported by appropriations from the fund, then the State Treasurer and State

Comptroller shall transfer from general funds to the fund only such amount as is

immediately necessary to satisfy outstanding expenditure obligations on a timely basis.

Likewise, that Section also provides for,

continuing authority for and direction to the State Treasurer and State Comptroller to

reimburse the funds of origin from general funds by transferring to the funds of origin,

at such times and in such amounts as directed by the Comptroller when necessary to

support appropriated expenditures from the funds, an amount equal to that transferred

from them plus any interest that would have accrued thereon had the transfer not

occurred…

While those borrowed funds have been repaid, should there be future borrowing under these

provisions and the RERF balance became insufficient for payments under any new contractual

obligations, these provisions would allow the Agency to make expenditures from the RERF prior to

the repayment of the transferred amount—i.e., to operate as though the RERF’s balance were at its

original amount, even if transferred funds have not yet been moved back into the RERF. In addition,

the Agency understands that the State Comptroller will coordinate with the Agency to make sure that

any appropriated expenditures that the Agency makes through new contractual commitments are

honored by ensuring that the balance of the RERF is at all times sufficient to make timely payments

on contracts. While the Agency understands that these transfers from the RERF have caused

consternation, based on the assurances contained in the law, it does not believe that the transfers

necessitate any adjustments to its proposed Illinois Solar for All program design, structure, and

budget.

8.4.2. Illinois Solar for All program design, structure, and budget

For the Low-Income Distributed Generation Initiative, the Low-Income Community Solar Project

Initiative, and Incentives for Non-Profits and Public Facilities sub-programs the Agency plans to

allocate up to $16.5 million per program year from the RERF for use for the Illinois Solar for All

Program (the Low-Income Community Solar Pilot Projects sub-program is conducted through a

different process that allocates funds to each procurement event rather than program year).

468

In the

First Revised Plan, the Agency clarified that this allocation will be on an accrual basis, meaning that

the amount allocated sets aside that much funding for selected applications during that program year,

but are likely to actually be expended in future years in many cases due to the development timeline

467

Section 5h.5 was initially created by Public Act 100-0023 and set the repayment time at two years from initial transfer. This transfer-

back deadline was subsequently amended to four years by Public Act 101-0010 and then to five years by Public Act 102-0016.

468

As stated in Section 2.6.1, a program year for ILSFA corresponds to an energy delivery year and thus starts June 1 of each year. Therefore,

a program year starts one month earlier than the state fiscal year, which begins July 1.

Illinois Power Agency 2022 Long-Term Plan (Final) August 23, 2022

234

of photovoltaic projects (RECs are paid for upon energization). Unallocated RERF funds from any

program year for a given sub-program would roll over and increase the balance available for the

subsequent program year for that sub-program.

Table 8-1: RERF Funding for Illinois Solar for All

469

Funding Source

Low-Income

Distributed

Generation

Incentives

470

Low-Income

Community Solar

Project Initiative

Incentives for Non-

Profits and Public

Facilities

Total

RERF Allocation Percent

35%

40%

25%

100%

Previously allocated* for

2018-2019 through 2021-

2022 Program Years

$18,000,000

$30,000,000

$12,000,000

$80,000,000

471

Allocated* for

2022-2023 Program Year

$5,775,000

$6,600,000

$4,125,000

$16,500,000

Allocated* for

2023-2024 Program Year

$5,775,000

$6,600,000

$4,125,000

$16,500,000

* RERF funds not allocated within a sub-program for a program year will roll over to the next program year for that same

sub-program.

Allocations are based on $150 million of the RERF available for Illinois Solar for All at the time of the

Initial Plan development, and assume continuing level support from the RERF for the three non-pilot

sub-programs in the 2022-2023, 2023-2024, and 2024-2025 program years (which, if fully allocated,

would eventually deplete the RERF, leaving only utility-supplied funding available for program years

after 2024-2025).

The funds allocated from the RERF are allocated according to the percentages specified in Section 1-

56(b)(2) of the Act as modified by Public Act 102-0662, namely 35% combined for the Low-income

Single-Family and Small Multifamily Incentive and the Low-income Large Multifamily Solar Incentive

sub-programs, 40% to the Low-Income Community Solar Project Initiative sub-program, and 25%

for the Incentives for non-profits and public facilities sub-program.

Prior to the enactment of Public Act 102-0662, Section 1-56(b)(2)(D) set aside 25% of the RERF for

Low-Income Community Solar Pilot Projects, which was $37.5 million. As discussed further in Section

8.5.7, the Agency set a budget of $20 million for the first Low-Income Community Solar Pilot Project

procurement held in December 2019 and two projects were selected. Public Act 102-0662 repealed

this subsection and there will be no subsequent procurements.

After accounting for all payments under the Supplemental Photovoltaic Procurement process

pursuant to Section 1-56(i) of the IPA Act, as well as all payments under Illinois Solar for All contracts,

whenever the balance of the RERF falls under $5,000, then the RERF shall be inoperative and any

remaining funds shall be transferred to the Supplemental Low-Income Energy Assistance Fund for

469

The annual RERF sub-program budgets stated above are gross budgets before deducting administrative, evaluation, & grassroots

education costs; the budgets actually available for REC incentives will be net of those costs.

470

This includes both the Low-income Single-Family and Small Multifamily Incentive and the Low-income Large Multifamily Solar

Incentive.

471

This includes $20,000,000 allocated to Low-income Community Solar Pilot Procurement projects from the procurement conducted in

2019. That sub-program of Illinois Solar for All was repealed by Public Act 102-0662.

Illinois Power Agency 2022 Long-Term Plan (Final) August 23, 2022

235

use in the Low-Income Home Energy Assistance Program, as authorized by the Energy Assistance

Act.

472

8.4.3. Utilities Annual Funding Available

Section 1-75(c)(1)(O) under Public Act 99-0906 contained a provision that allocated the greater of

$10 million or 5% of “fund available under the plan” to Illinois Solar for All. Under Public Act 102-

0662, this language was updated:

The long-term renewable resources procurement plan shall allocate up to $50,000,000

per delivery year to fund the programs, and the plan shall determine the amount of

funding to be apportioned to the programs identified in subsection (b) of Section 1-56

of this Act; provided that for the delivery years beginning June 1, 2021, June 1, 2022, and

June 1, 2023, the long-term renewable resources procurement plan may average the

annual budgets over a 3-year period to account for program ramp-up. For the delivery

years beginning June 1, 2021, June 1, 2024, June 1, 2027, and June 1, 2030 and [sic]

additional $10,000,000 shall be provided to the Department of Commerce and Economic

Opportunity to implement the workforce development programs and reporting as

outlined in Section 16-108.12 of the Public Utilities Act.

As discussed in Section 2.9.1, the Agency understands the above statutory provision to refer to funds

collected by utilities through RPS riders under Section 1-75(c)(6) of the Act and Section 16-108(k) of

the PUA. Public Act 102-0662 increased the previous $10,000,000 annual allocation of utility funds

to $50,000,000. For the 2021-2022, 2022-2023, and 2023-2024 delivery years, the Agency is allowed

to determine the allocation to allow for a ramping up at an average of $50,000,000 per year for those

three program years, then will allocate $50,000,000 each year towards Illinois Solar for All.

As the 2021-2022 delivery year was already underway when Public Act 102-0662 was enacted, it

raised the question of how the annual allocation of utility funding for the 2022-2023 delivery year

had already been established through the Revised Long-Term Plan approved by the Commission in

2020. On January 10, 2022 the Agency filed a petition with the Illinois Commerce Commission

seeking to have a limited reopening of the Revised Long-Term Plan to update the 2022-2023 delivery

budget year allocation of utility RPS funds to conform with Public Act 102-0662.

473

To maximize

opportunities in the Illinois Solar for All Program the Agency proposed an immediate ramp-up to $50

million. The Commission approved the IPA’s petition on March 3, 2022, and the current Illinois Solar

for All budget has been updated accordingly. As a result of this funding increase a rolling submission

window for the Non-Profit/Public Facility category opened on March 21, 2022, to accommodate the

additional subprogram budget and accepted project submissions through the end of the 2021-2022

Program Year on May 31, 2022.

For the 2022-2023 and 2023-2034 delivery years the Agency will continue allocating $50 million per

year from utility collected fund.

These funds are supplied by each utility based on the allocation percentages contained in Section

3.4.1.

472

20 ILCS 3855/1-56(b-10).

473

See: https://www.icc.illinois.gov/docket/P2019-0995/documents/319359.

Illinois Power Agency 2022 Long-Term Plan (Final) August 23, 2022

236

Section 1-56(b)(2), as updated by Public Act 102-0662, now requires that utility funding initially be

allocated to the sub-programs at the same percentages as the RERF funds, as dictated by that same

section (35% combined allocation to the Low-income Single Family and Small Multifamily Solar and

the Low-income Multifamily Solar sub-programs, 40% to the Low-Income Community Solar Project

Initiative, and 25% to Incentives for Non-Profits and Public Facilities). In this 2022 Plan, the Agency

will continue the approach described in the Initial Plan and now required under Section 1-56(b)(2)

for the 2021-2022 program year. As this allocation of utility funding to the sub-programs is not

required by law after the initial allocation, the Agency may adjust utility funding between those sub-

programs on an as-needed basis after the 2022-2023 program year if there are available funds in one

sub-program and higher demand in another sub-program, with the exception that funds for the

Distributed Generation sub-program will not be reallocated.

474

For each of the sub-programs, approved project applications within a program year will be first

funded by the utility funds, and then by the RERF funds. The reason for this approach is that utility

funds are that not spent within five years of when they are collected may be returned to ratepayers

through a reconciliation process,

475

while RERF funds are not subject to the same reconciliation and

refund mechanism. Unallocated RERF funds within a sub-program from each program year would

be rolled over to the following program year.

The funding for job training programs provided by the Department of Commerce and Economic

Opportunity (“DCEO”) under Section 16-108.12 of the PUA is noted in the budget discussion in

Chapter 3. As those funds are not directly part of the Illinois Solar for All Program as managed by the

Agency, those funds are not included in this budget discussion. (The intersection between the Illinois

Solar for All Program and the job training programs is discussed in Section 8.9.1)

8.4.4. Section 16-108(k) Funding (Now Inoperable)

Prior to the enactment of Public Act 102-0662, Section 16-108(k) of the Public Utilities Act

contemplated a possible situation in which the total amount of funds appropriated by the General

Assembly from the Renewable Energy Resources Fund during the period between June 1, 2017 and

August 1, 2018 is less than $200,000,000, creating a “funding shortfall” and a mechanism to

potentially address that shortfall. This provision has now been removed from Section 16-108(k). For

a discussion of this now inoperable mechanism, please refer to Section 8.4.3 of previous versions of

the Long-Term Plan.

8.4.5. Setting Budgets

The Agency has developed the Illinois Solar for All Program under the assumption that the funds

available for the 2022-2023 and 2023-2024 delivery years will be funds from the RERF and the

utility-supplied funds identified in Section 8.4.3. Table 8-2 provides a summary of the Illinois Solar

for All funding.

As discussed in Section 8.5.1, 25% of funds in each sub-program category will be reserved for the

Energy Sovereignty Fund that is intended to promote ownership for eligible customers.

474

See Section 8.5.3.1.

475

See 220 ILCS 5/16-108(k).

Illinois Power Agency 2022 Long-Term Plan (Final) August 23, 2022

237

Table 8-2: Total Illinois Solar for All Budgets

476

Funding Source

Low-Income Distributed

Generation Incentives

(Low-Income Single-Family and

Small Multifamily Solar; Low-

Income Large Multifamily Solar)

Low-Income

Community Solar

Project Initiative

Incentives for Non-

Profits and Public

Facilities

Percentage

Allocation

35%

40%

25%

2022-2023 Program Year

RERF

$5,775,000

$6,600,000

$4,125,000

Utility

$17,500,000

$20,000,000

$12,500,000

Total

$23,775,000

$26,600,000

$16,125,000

2023-2024 Program Year

RERF

$5,775,000

$6,600,000

$4,125,000

Utility

$17,500,000

$20,000,000

$12,500,000

Total

$23,775,000

$26,600,000

$16,125,000

8.4.6. Payment Structure

The Illinois Solar for All Program is structured so that the Agency “may pay for such renewable

energy credits through an upfront payment per installed kilowatt of nameplate capacity paid once

the device is interconnected at the distribution system level of the interconnecting utility and verified

as energized.”

477

Section 7.10.5 describes the options for the capacity factor used in the Adjustable

Block Program to convert kilowatt size of a project to the number of RECs the system would be

expected to generate over 15 years and those same options apply to Illinois Solar for All. For each

approved system, the Program Administrator will calculate a 15-year REC delivery quantity. Illinois

Solar for All Approved Vendors will have the option of using a PVWatts calculated capacity factor

(stated relative to a system’s nameplate capacity in AC rating) automatically computed by the

application platform, or propose an alternative capacity factor based upon an analysis conducted

using an equivalent tool. Alternative capacity factors may be proposed as part of each system’s

application and will be subject to review and approval by the Program Administrator. Systems using

bifacial panels must submit an alternative capacity factor subject to review and approval by the

Program Administrator. All capacity factors submitted must be for a system’s first year; as stated

below, annual REC delivery commitments will incorporate a 0.5% per year degradation factor.

Payments for Illinois Solar for All incentives take the form of upfront payments upon energization of

systems, with the similar conditions as the Adjustable Block Program that a system must also be

registered in GATS or M-RETS to verify that it will produce RECs.

476

As noted above in Section 8.4, the RERF sub-program funding amounts are gross budgets before deduction of administrative costs.

Additionally, there could be unused utility funds and/or RERF funds from the sub-program budgets for 2018-2019 through 2021-2022

that are rolled over to 2022-2023.

477

20 ILCS 3855/1-56(b)(3).

Illinois Power Agency 2022 Long-Term Plan (Final) August 23, 2022

238

REC delivery contracts are either with the Agency or an electric utility, depending on the funding

source,

478

and include the assignment of RECs from each system for 15 years. RECs from these

contracts are applied to the annual RPS goals of the utility to which the project is interconnected, but

do not count toward each utility’s new photovoltaic project targets.

479

Projects that receive a contract

through Illinois Solar for All are not eligible also to receive a contract through the Adjustable Block

Program.

480

Contracts with the Agency (that utilize funds from the RERF) are standard contracts that include

required state contract provisions—such as terms, conditions, and attachments—including a clause

stating that payment is subject to appropriation. Contracts with the utilities may have similarities,

but vary given the different requirements applicable to each.

481

Similar to what was discussed in

Section 7.14 regarding contracts for the Adjustable Block Program, the Agency published standard

REC delivery contracts (one for the Agency as counterparty and one for a utility as counterparty) for

Illinois Solar for All in May 2019; following the approval of the First Revised Plan the Agency updated

the Illinois Solar for All REC contract structure following the concepts included in Section 7.13,

including updates to the payment withholding in lieu of collateral option as discussed in Section

7.12.1. This new contract was implemented beginning in the fourth program year, 2021-2022. The

Agency will again update the Illinois Solar for All REC contract in order to implement changes to

program requirements in accordance with the Commission’s approval of this Plan in ICC Docket No.

22-0231.

The Act is silent on how to allocate RECs from projects located in the service territories of municipal

utilities, rural electric cooperatives, or Mt. Carmel Public Utility. The Agency does not apply RECs

from those projects procured through contracts with the Agency using the RERF to the utility RPS

goals, while any RECs procured through contracts with a utility are applied to the RPS goals of the

contracting utility.

482

8.5. Program Requirements and Incentives

Section 1-56(b)(2) outlines four sub-programs of the Illinois Solar for All Program:

1. Low-Income Single-Family and Small Multifamily Solar

2. Low-Income Community Solar Project Initiative

3. Incentives for Non-Profits and Public Facilities

4. Low-income large multifamily solar

478

See 20 ILCS 3855/1-56(b)(2). (“Contracts that will be paid with funds in the Illinois Power Agency Renewable Energy Resources Fund

shall be executed by the Agency. Contracts that will be paid with funds collected by an electric utility shall be executed by the electric

utility.”)

479

See id.

480

Section 1-56(b)(3) of the IPA Act requires that for Illinois Solar for All contracts, “[p]ayments for renewable energy credits shall be in

exchange for all renewable energy credits generated by the system during the first 15 years of operation.” Sections 1-75(c)(1)(L)(ii) and

(iii) both contain provisions related to the various components of the Adjustable Block Program that, “[t]he electric utility shall receive and

retire all renewable energy credits generated by the project for the first 15 years of operation.” These two provisions from Section 1-

56(b)(3) and Section 1-75(c)(1)(L) are mutually exclusive as only one REC can be produced, transferred, and retired for each MWh of

generation.

481

See Docket No. 17-0838, Final Order dated April 3, 2018 at 151-152.

482

To date no approved Illinois Solar for All projects are located in the service territories of rural electrical cooperatives or municipal

utilities.

Illinois Power Agency 2022 Long-Term Plan (Final) August 23, 2022

239

These sub-programs provide an incentive based on the price per REC from the Adjustable Block

Program, with adjustments to that price as described below to account for the specific needs of the

Illinois Solar for All Program. The Low-Income Distributed Generation Incentive sub-program was

divided by Public Act 102-0662 into two separate sub-programs, the Low-Income Single-Family and

Small Multifamily Solar sub-program, and the Low-income Large Multifamily Solar sub-program.

In addition to the four Illinois Solar for All sub-programs, Section 1-56(b)(4) of the Act allows some

flexibility to propose changes that “more effectively maximizes the benefits to low-income

customers":

In the course of the Commission proceeding initiated to review and approve the plan,

including the Illinois Solar for All Program proposed by the Agency, a party may propose

an additional low-income solar or solar incentive program, or modifications to the

programs proposed by the Agency, and the Commission may approve an additional

program, or modifications to the Agency's proposed program, if the additional or

modified program more effectively maximizes the benefits to low-income customers

after taking into account all relevant factors, including, but not limited to, the extent to

which a competitive market for low-income solar has developed.

483

Section 1-56(b)(2) as amended by Public Act 102-0662 also states:

In addition to the programs outlined in paragraphs (A) through (E), the Agency and

other parties may propose additional programs through the Long-Term Renewable

Resources Procurement Plan developed and approved under paragraph (5) of

subsection (b) of Section 16-111.5 of the Public Utilities Act. Additional programs may

target market segments not specified above and may also include incentives targeted to

increase the uptake of nonphotovoltaic technologies by low-income customers,

including energy storage paired with photovoltaics, if the Commission determines that

the Illinois Solar for All Program would provide greater benefits to the public health and

well-being of low-income residents through also supporting that additional program

versus supporting programs already authorized.

The Agency is implementing two pilots addressing barriers expressed by stakeholders:

• The first pilot, described in Section 8.5.3.3, provides additional incentives for the home

repairs and upgrades necessary to install solar on homes that are eligible for the Low-Income

Single-Family and Small Multifamily Solar Program.

• Section 8.5.3.4 describes the second pilot, which will focus on reaching areas underserved by

ILSFA, in which the Program Administrator will assume the majority of the customer-

interaction and public outreach functions. Selection will prioritize Small and Emerging

Vendors.

8.5.1. Energy Sovereignty

As noted above in Section 8.2.4, Section 1-56(b)(2)(A)(i) of the IPA Act requires the Agency to reserve

“a portion” of Illinois Solar for All “for projects that promote energy sovereignty through ownership

483

20 ILCS 3855/1-56(b)(4).

Illinois Power Agency 2022 Long-Term Plan (Final) August 23, 2022

240

of projects” by eligible entities. The Agency defines terms, provides analysis, and outlines here a

number of measures to incorporate ownership policies into the four sub-programs of ILSFA.

Additional research and discussion of energy sovereignty is provided in Appendix G.

The Agency will reserve one-quarter (25%) of the funds in each of the four sub-program budgets for

projects that promote energy sovereignty, with an additional bonus for distributed solar projects.

Projects that feature or facilitate ownership of projects by low-income households or other entities

listed in Section 1-56(b)(2)(A)(i) meet this requirement. Projects where the low-income household

or eligible entity holds majority ownership of the installation from the time of project application will

automatically qualify as promoting energy sovereignty. For projects claiming to “facilitate” energy

sovereignty, the Agency will examine the project ownership model, as discussed below.

Ownership facilitation models that would likely meet this standard are best understood as falling

into two categories: on-site projects that are on the customer’s property, serving 1-4 units of housing,

5+ units of housing, or non-profits and public facilities; or remotely located community solar projects.

Section 1-56(3) of the IPA Act requires Illinois Solar for All incentives to be paid upon energization

of a project, providing an upfront payment to the project developer, who then delivers ongoing

services to the eligible customer. Since models that involve the transfer of ownership after five to

seven years are best able to capitalize on federal incentives, this poses a timing issue for promoting

energy sovereignty. Section 1-56(B)(2)(A)(i) of the Act does allow the Agency to “consider the

inclusion of projects that promote ownership over time or that involve partial project ownership by

communities, as promoting energy sovereignty."

To solve this timing issue, the Agency proposes the following strategies for the two ownership

models, on-site and community solar.

8.5.1.1. On-Site Projects

For on-site systems, the Agency will offer an adder of $10 per REC for projects that facilitate

ownership through a transfer of ownership after project energization. As with all Illinois Solar for All

REC contract payments, full payment will be due upon energization. The REC contract for such

projects will feature additional contract terms that require a transfer of ownership at a certain date,

such as five to seven years after energization. The Agency envisions that the TPO would have a

contract for a lease or power purchase agreement with the customer that featured an early buyout

clause at a given time and the Agency will develop a standard template for the requirements of the

buyout clause.

The incentives paid for energy sovereignty would be managed in one of two ways: they could be held

back and used at the time of transfer to cover the cost of the buyout at fair market value, the cost of

ongoing monitoring and maintenance after transfer of ownership, and the cost of equipment

replacement for a certain period (perhaps up to 25 years); or they could be retained by the TPO with

the contract featuring a buyout value at a commensurately lower price, and the TPO agreeing to

provide services after transfer.

The amount and apportionment of the ILSFA incentives would be adjusted to reflect the energy

sovereignty adder. For example, if ownership is expected to be transferred at the end of year seven,

the initial ILSFA incentive may be based on a seven-year value of RECs, with the remaining eight years

including the energy sovereignty adder.

Illinois Power Agency 2022 Long-Term Plan (Final) August 23, 2022

241

The Program Administrator must be notified of the transfer of ownership when it occurs along with

documentation of how it adheres to the contract terms. The Agency, or contracting utility, would be

able to claw back any ownership incentives if the transfer does not happen as expected.

There are many permutations of customer types, building ownership structures, and solar business

models. The Agency’s goal is to enable ownership for the greatest number of potential beneficiaries

in a financially efficient manner, while maintaining consumer protections and delivering benefits to

eligible customers. As approaches to energy sovereignty are implemented, the Program

Administrator will consider models that could work for each permutation. The Program

Administrator will further keep records of transactions related to achieving energy sovereignty,

including finances, costs and benefits, type of customers, and barriers encountered, to facilitate

learning and program evaluation.

8.5.1.2. Community Solar

Promoting ownership of off-site community solar projects by low-income households would require

a different approach than on-site systems. As noted above in Section 8.2.2, community solar

installations are eligible for different tax incentives and use different business models than on-site

systems.

To encourage energy sovereignty for community solar, the Agency could take the following actions:

1. Energy sovereignty payments could be used to pay for ownership shares in a community

solar cooperative on behalf of eligible customers. These shares would entitle the

customer/owner to receive dividends and to subscribe to electricity from the project at a

discounted rate, sufficient to meet bill savings requirements. The customer/owner would be

able to sell the shares to other co-op members, or to the co-op itself.

2. As with on-site solar, energy sovereignty payments could be used to promote ownership of

individual panels located at a community solar project. The funds could be used to transfer

ownership to an eligible customer after tax benefits have been fully captured, such as through

an early buyout of a lease or PPA. Energy sovereignty payments would be paid upfront, and

either held in escrow to pay for the buyout or taken by the TPO and reflected in contract

terms relating to an early buyout.

The Agency will give a scoring preference to ILSFA community solar projects and set aside a

minimum of 25% of the ILSFA Low-Income Community Solar subprogram budget for projects that

result in ownership by customers. Given the highly competitive state of the Community Solar

subprogram, the Agency believes this will sufficiently incentivize energy sovereignty projects. This

prioritization will be applied after the prioritization for projects located in environmental justice

communities. If an insufficient number of Energy Sovereignty awards are made to meet the 25% set-

aside within nine months after the deadline for program applications, the funds will be made

available to community solar projects that do not feature energy sovereignty.

The content of subscription agreements for subscribers to community solar projects featuring energy

sovereignty will need to be reviewed and approved by the Program Administrator before being

offered to customers. The Agency will encourage Approved Vendors to use a standard subscription

agreement to minimize the level of administrative review. The Agency also reserves the right to

perform a financial audit on a community solar cooperative that receives ILSFA support. The

Administrator will convene a stakeholder process to facilitate education about cooperatives, share

Illinois Power Agency 2022 Long-Term Plan (Final) August 23, 2022

242

best practices, and develop standards for consumer disclosure, content for job training programs,

and materials or templates to assist with cooperative startups. The Agency will collect and make

public data on the number of energy sovereignty projects developed in each subprogram and

reassess whether additional incentives are needed in the next Plan revision.

In the version of this Plan filed for Commission approval, the Agency noted that while much of this

analysis has focused on how to manage federal tax incentives, Congress may change to how

renewable energy incentives are delivered. Subsequent to the approval of this Plan, the federal

government enacted the Inflation Reduction Act on August 16, 2022. The IPA will review the changes

in federal law and, if necessary, revisit Illinois Solar for All program designs through appropriate

means.

These ownership strategies will be pursued in coordination with other programs created under

Public Act 102-0662. The Agency is not the only agency tasked with promoting energy sovereignty,

making interagency collaboration vital.

The Community Solar Energy Sovereignty Program, part of the Jobs and Environmental Justice Grant

Program created in Section 5-60 of the Energy Transition Act enacted through Public Act 102-0662,

will be managed by the DCEO. The program will award grants to projects "that best demonstrate the

ability and intent to create community ownership and other local community benefits, including local

community wealth building.” Grants can be awarded for a variety of business tasks as well as to

support entities that would assist in ongoing operation, “such as community solar cooperatives."

Priority will be given to projects located in equity investment eligible communities and that provide

“additional benefits for participating low-income households." It is noted that the statute does not

say that grants can be used to purchase systems for eligible entities, suggesting a complementary role

for the incentives provided through Illinois Solar for All.

Aside from budget updates to the 2021-2022 program year, as authorized by Public Act 102-0662,

any changes (compared to the First Revised Plan) to sub-program terms and conditions, and other

general aspects of Illinois Solar for All, described subsequently in this Chapter (as well as the

budgetary discussion in Section 8.4 above) will be effective for the 2022-2023 and 2023-2024

program years and will not apply to the 2021-2022 program year which will have been completed

by the time the Agency expects this 2022 Long-Term Plan to be approved by the Commission.

As listed in Table 8-3, approximately $66.5 million is expected to be available in program years 2022-

2023 and 2023-2024, in addition to any unallocated funds rolled over from program year 2021-2022.

8.5.2. Setting Incentive Levels

The incentive levels described in the following Sections were derived by utilizing the REC prices for

the Adjustable Block Program as described in Section 7.5 and adjusting those prices to meet the

objectives of the Illinois Solar for All Program. These incentives will be offered through a 15-year REC

delivery contract, either with the Agency for projects funded with the Renewable Energy Resources

Fund, or with a utility for projects funded through utility-supplied funds.

Incentive levels are expressed as REC prices and are set according to the same groups and categories

as the Adjustable Block Program (Group A for projects located in Ameren Illinois, Mt. Carmel,

MidAmerican, and rural electric cooperatives and municipal utilities located in MISO; Group B for

projects located in ComEd, and rural electric cooperatives and municipal utilities located in PJM).

Unlike the Adjustable Block Program, these incentives have not been and will not be adjusted upward

Illinois Power Agency 2022 Long-Term Plan (Final) August 23, 2022

243

or downward based upon blocks of capacity filling. Rather, the Agency proposes to review and update

the incentive levels on an annual program year basis. That update will include an adjustment to

account for how the comparable Adjustable Block Program REC price for each Group and category

has changed since the previous update, allowing for the prices offered through Illinois Solar for All to

track overall market conditions while continuing to be offered at a higher level than for the

Adjustable Block Program.

For this 2022 Plan, the Agency updated ILSFA REC Prices based on the modeling of the updated REC

Pricing Model described in Chapter 7 and in Appendices D and E. The changes to REC Prices largely

reflect changes to the underlying modeling used for the Adjustable Block Program that then flow

through to Illinois Solar for All. This means that changes to Adjustable Block Program Prices that are

adopted through the approval of this 2022 Plan will also then apply to ILSFA prices. In accordance

with the Commission’s Final Order approving this Plan, the 2022-2023 REC Prices were published

on August 1, 2022.

484

In setting REC prices for the Low-Income Distributed Generation Incentive sub-program for the

Initial Plan, the Agency adjusted the Adjustable Block Program’s REC prices in the CREST model by

setting the assumed debt financing of the project to 0%, and increasing the net metering benefit

shared with participants from 20% to (i) 100% for residential participants in 1-4 unit buildings and

(ii) 50% for residential participants in larger buildings.

485

For this 2022 Plan the Agency will increase

the development costs component of the model for 1-4 unit buildings to 200% of the value used in

the Adjustable Block Program to recognize the increased complexity of developing residential

projects as part of Illinois Solar for All, especially the added costs of identifying and verifying eligible

low-income customers.

For the Low-Income Community Solar sub-program, the Adjustable Block Program REC prices were

adjusted by shortening the financing term to five years and lowering the debt financing to 35%. For

the Incentives for Non-Profits and Public Facilities sub-program, REC prices were adjusted from the

ABP DG pricing model by considering the project as a non-taxable entity; the up-to-10 kW size

segment was assumed to be non-residential instead of residential; and the net metering benefit to be

shared with participants was increased from 20% to 50%. The Agency does not propose any

adjustments to the REC price methodology for these two sub-programs for this 2022 Plan.

The Agency believes these approaches represent reasonable proxies for the higher incentive level

needed for Illinois Solar for All projects compared to Adjustable Block Program projects to overcome

the financing barriers and other hurdles these project face.

8.5.3. Low-Income Single-Family and Small Multifamily Solar

The Low-Income Distributed Generation Incentive sub-program, created in Public Act 99-0906, has

been historically under-subscribed, spending less than its budget allowed. While participation in the

sub-program continues to increase over time, funds in its budget remained unspent at the end of each

program year. Public Act 102-0662 introduced several changes to this subprogram in an effort to

reduce barriers to participation and grow the low-income market for distributed generation.

484

https://ipa.illinois.gov/content/dam/soi/en/web/ipa/documents/announcement-rec-prices-august12022.pdf

485

See Docket No. 17-0838, Final Order dated April 3, 2018 at 155; see also Appendices E-3-a and E-3-b.

Illinois Power Agency 2022 Long-Term Plan (Final) August 23, 2022

244

The sub-program was created to provide funding for photovoltaic projects located on individual

homes and multi-unit residential buildings. Public Act 102-0662 updated Section 1-56(b)(2), which

lays out the Illinois Solar for All sub-program structure, creating separate sub-programs for projects

serving single-family and two- to four-unit multifamily residences (the Single-Family and Small

Multifamily category) and low-income residences with five or more units (the Large Multifamily

category), and setting aside a portion of the program to encourage energy sovereignty. Separate

schedules of REC incentive prices were established for projects serving one-to-four-unit residences

and 5+ unit multi-family buildings. To ensure that large Low-Income Distributed Generation projects

could not quickly exhaust the sub-program budget, 25% of the sub-program budget was reserved in

a nine-month carveout to ensure opportunities for one-to-four-unit projects beginning in the 2020-

2021 program year.

Additional changes enacted by P.A. 102-0662 include the additional low-income consumer

protections outlined in Chapter 9 and Section 8.11 and funding set aside targeted to environmental

justice communities (25% of each sub-program) and to projects promoting energy sovereignty (25%

of each sub-program). In approving and modifying the First Revised Plan, the Commission noted that

multi-faceted challenges to participation in the Low-Income Distributed Generation sub-program

must be addressed. The Agency and Program Administrator have worked with stakeholders to

identify barriers to participation in this sub-program and continue to explore and implement

adjustments to increase participation, lower soft costs, and simplify sales procedures.

486

For example, a referral process to generate greater participation was developed in fall of 2020 and

stakeholder input was received through the end of that year.

487

The referral process and an income

verification process for single-family homeowners were both implemented in mid-2021. For this

2022 Plan, the Agency clarifies that it interprets the Commission’s directive to implement such

processes in a competitively neutral fashion to mean that the processes should not give advantage to

one Illinois Solar for All Approved Vendor or group of Approved Vendors over others, nor should

they give the appearance of doing so. Furthermore, the referral process will consider geography,

availability of Approved Vendors serving single-family customers in a potential participant’s area,

services provided, the efficiency of the process, and transparency of offers.

Additional steps for streamlining the project submission process have been made for this 2022 Plan

including:

• Extending the time period in which the Program Administrator-provided income verification

is valid from 6 to 12 months (Section 8.10.4.1).

• Amending Section 8.11 to eliminate the requirement to present and sign the disclosure seven

days prior to consummation of the contract along with an extension of the cancellation period

to simplify the customer engagement process with one less touchpoint in the customer

acquisition process.

• Reaffirming the Agency’s commitment to more closely work with third-party energy

efficiency program administrator or community action agencies to facilitate connecting their

participants to Illinois Solar for All Approved Vendors and providing initial site suitability

486

See Docket No. 19-0995, Final Order dated February 18, 2020 at 101.

487

In response to concerns raised by various stakeholders in the process of approving the First Revised Plan, the Commission determined

that the Agency and the Program Administrator shall explore implementing a process to connect interested income-qualified customers

with Illinois Solar for All Approved Vendors, and that the Agency must implement any such process in a competitively neutral fashion.

(Docket No. 19-0995, Final Order dated February 18, 2020 at 108.) This referral program implements that directive.

Illinois Power Agency 2022 Long-Term Plan (Final) August 23, 2022

245

screening where applicable (Section 8.8.3). As detailed in Section 8.15, the Agency interprets

expanded language in Section 1-56(b)(3) of the IPA Act as amended by Public Act 102-0662

to allow grassroots education funding to support activities beyond the community education

campaigns funded to date.

• Removing the minimum batch requirement (Section 8.10.1) and making the ILSFA and ABP

portals simpler and more uniform with each other.

• Redesigning the disclosure forms for ILSFA and ABP to shorten and simplify the documents.

The Agency is hopeful that these changes will help to lower soft costs and encourage increased

participation in the sub-program, recognizing that of the identified barriers to increasing

participation is the complexity of the sub-program and confusion or mistrust from potential

participants.

Section 8.5.3.4 includes a proposed pilot to assess the impact of a more streamlined program model.

In this pilot the Program Administrator will assume the majority of the customer-interaction and

public outreach functions, such as recruiting customers, conducting income verification, partnering

with local organizations, and liaising with job training and placement programs. This pilot will focus

on reaching areas underserved by Illinois Solar for All Approved Vendors to date and will prioritize

selection of Small and Emerging Vendors.

To better understand where projects are stalling, the Agency will also improve the tracking and

transparency of project processing metrics and will provide it as needed to the ILSFA Stakeholder

Advisory Group described in Section 8.17. This tracking will inform opportunities to improve the

process and provide clear expectations to program participants.

Beyond these improvements, the Agency appreciates the stakeholder recommendations for

streamlining the application submission process through the next update of the Illinois Solar for All

Approved Vendor Manual. The Agency and Program Administrator will seek stakeholder feedback

in that update process.

8.5.3.1. Eligibility

For single-family homes, households must verify that they are low-income; for two- to four-unit

residential buildings, at least two of the households must be verified as low-income. In addition to

projects being eligible based on household income, projects developed on homes or buildings that

qualify for US Department of Housing and Urban Development (“HUD”) Project-Based Vouchers or

Project-Based Rental Assistance (which are programs for housing units dedicated to low-income

tenants) also qualify. The income qualification levels required for participation in these programs

are lower than income requirements for the Illinois Solar for All Program.

Under the Revised Plan, to help ensure funding would be available for projects for 1-4 unit buildings,

25% of the sub-program budget was carved out for 1-4 unit buildings projects for the first nine

months of the program year, and any unobligated funds from that carveout was released for any Low-

Income Distributed Generation project for the final three months of the program year, and any

unused sub-program funds would be rolled over to the following year’s sub-program budget. In a

similar fashion, for this 2022 Plan the Agency will hold the initial budget allocations for the Low-

Income Single and Small Multi-family and the Low-Income Large Multifamily Solar sub-programs for

the first nine months of the program year, at which time the two sub-program allocations would

combine to be used on a first-come, first-served basis by projects of either sub-program. At the end

Illinois Power Agency 2022 Long-Term Plan (Final) August 23, 2022

246

of the program year, any unreserved sub-category funds will rollover to the total budget allocation

for the Low-Income Single and Small Multi-family and the Low-Income Large Multifamily Solar sub-

programs for the following program year of Distributed Generation sub-program, in accordance with

the Commission’s order in approving and modifying the Revised Plan.

488

8.5.3.2. Incentive Level

As discussed in Section 7.5, these REC prices are based on an update of the REC Pricing model

developed for this 2022 Long-Term Plan.

Table 8-3: Incentives for the Low-Income Single and Small Multifamily Solar

Program($/REC)

489

System Size

Group A

Change from Initial

and First Revised Plan

Prices

Group B

Change from Initial

and First Revised Plan

Prices

≤10 kW

$180.67

26.3%

$175.23

22.5%

>10 - 25 kW

$142.16

11.5%

$141.75

11.1%

>25 kW – 100 kW

$107.10

3.7%

$108.51

5.1%

To encourage Energy Sovereignty, an additional $10 per REC would be added for projects that result

in ownership by the customer, such as through an early buyout of a lease or PPA.

These incentive payments are intended to be sufficient to provide tangible economic benefits to

participants through enabling project developers to eliminate upfront costs to the participants for

the installation of photovoltaic projects. The REC price is a standard incentive for the contractually

obligated delivery of a renewable energy credit and not customized for each project.

8.5.3.3.

Pilot Program on Home Repairs and Upgrades

Program participants and stakeholders have reported that a number of customers who are eligible

for ILSFA have been unable to participate in the program due to the need for home repairs and

electric upgrades, which are a precondition for installation of solar panels. While the ILSFA program

was designed to support the installation of solar distributed generation, the Agency recognizes that

low-income residents are more likely to face this impediment to participation and that it may be

frustrating the overall objective of the program.

Under Section 1-56(b)(4) of the IPA Act, the Long-term Plan approval process may include

“additional low-income solar or solar incentive program, or modifications to the programs proposed

by the Agency, and the Commission may approve an additional program, or modifications to the

Agency's proposed program, if the additional or modified program more effectively maximizes the

488

See Docket No. 19-0995, Final Order dated February 18, 2020 at 100-101.

489

While theoretically projects for 1-4 unit buildings could be larger than 100 kW, the Agency does not believe that it is technically possible

for a 4-unit project to exceed that size and thus only REC prices for up to 100 kW are displayed here. The REC pricing model included in

Appendices D and E includes a full set of modeled REC prices for.

Illinois Power Agency 2022 Long-Term Plan (Final) August 23, 2022

247

benefits to low-income customers after taking into account all relevant factors, including, but not

limited to, the extent to which a competitive market for low-income solar has developed.”

490

The Agency has concluded that the creation of a pilot program in ILSFA to provide additional

incentives for the home repairs and upgrades necessary to install solar on homes that are eligible for

the Low-Income Single-Family and Small Multifamily Solar Program would “more effectively

maximize[…] the benefits to low-income customers” provided by the Illinois Solar for All program.

The Agency will seek input from stakeholders before finalizing the pilot program details.

Eligible repairs and upgrades will be limited to actions required for solar photovoltaics installation

on the premises, such as electrical work, breaker panel upgrades, and roof repairs, beyond those of a

normal solar installation. The Agency will review potential cost caps per project and limits on the

number of projects in the pilot based on market data and consultation with the Program

Administrator.

Further, as part of the fact-finding nature of the pilot program, the Agency and its Program

Administrator will test ways to help the eligible customer seek funding from the various federal,

state, and non-profit programs listed in Section 8.8.6. If funding is not available in a timely manner

from those programs, the pilot may support the projects. The ability of other programs to fund

repairs will be included in an evaluation of the pilot.

8.5.3.4. Program Delivery Pilot

The operating structure of the Illinois Solar for All program is to offer incentives to competitive

market actors to help low-income and other eligible customers access the benefits of solar power. In

some regards this approach has worked well, as sub-programs have quickly filled their allotted

budgets and seen large amounts of solar developed, helping expand the commercial solar market in

Illinois.

However, the distributed generation sub-program has yet to achieve participation levels that fully

leverage its annual budget. While participation levels have been increasing in the 2021-2022

program year, Approved Vendors have reported a number of barriers to distributed solar, including

customers unfamiliar with solar power or distrustful of marketers, structural impediments such as

electrical systems and roofs in need of repair, language barriers, and a complex administrative

process. While this 2022 Plan includes a number of refinements to reduce barriers to participation,

the Agency has determined that the Program may benefit from testing a more comprehensive change

to see if it could have a more significant impact on improving participation levels.

In some states, low-income solar programs have been structured with a single entity providing all

aspects of program management and delivery – a vertically-integrated model. Such a model could be

better equipped to work with low-income customers and communities as it reduces the transaction

costs associated with the higher need for customer education and ongoing support.

This approach could also facilitate greater coordination with job training and placement programs,

better incorporation of energy efficiency measures, and partnerships with local organizations. By

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20 ILCS 3855/1-56(b)(4).

Illinois Power Agency 2022 Long-Term Plan (Final) August 23, 2022

248

specializing in low-income solar, the entity can develop greater skills and efficiencies working with

the target market.

Section 1-56(b)(2) permits the Agency to “propose additional programs” through the Long-term

Renewable Resources Plan, provided that the “Commission determines that the Illinois Solar for All

Program would provide greater benefits to the public health and well-being of low-income residents

through also supporting that additional program versus supporting programs already authorized.”

Given the challenges faced thus far in garnering full participation in the subprograms designed for

residential distributed generation, the Agency proposes testing a new model of program delivery for

the ILSFA distributed generation sub-programs.

Through a limited pilot program, the Agency would implement a more consolidated model where the

Program Administrator will assume the majority of the customer-interaction and public outreach

functions, such as recruiting customers (including provision of the initial program brochure),

conducting income verification and site suitability assessment, partnering with local organizations,

and liaising with job training and placement programs.

The pilot will take place for two years in select, defined communities where a vendor chosen through

a competitive Request for Proposals process would serve as the sole Approved Vendor for

participants.

The pilot would be limited to distributed generation projects receiving RECs in the Low-Income

Single Family and Small Multifamily subprogram. The Agency may establish a pre-set budget or limit

on the number of projects.

The Agency will conduct a stakeholder feedback process to collect input on details of the pilot design,

such as the regions selected for the pilot. The selected communities will represent diverse

geographies of the state, such as one of the 77 community areas of Chicago,

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a suburban community,

and a down-state community, and the selected communities may be an Environmental Justice

Community or an Equity Investment Eligible Community or contain a concentration of such

communities. The Agency will make final decisions on the pilot design and will use a request for

proposals (“RFP”) to select an Approved Vendor for each pilot area.

As the REC price for the Low-Income Single and Small Multifamily Solar Program includes

adjustments related to the increased development costs for participating projects (set at 200% of the

comparable costs for Adjustable Block Program projects), the REC price for the pilot will be adjusted

to recognize the lower cost to Approved Vendors that will result from the Program Administrator

taking on many upfront responsibilities. The final REC price adjustment will also be determined

through a stakeholder feedback process.

The pilot will focus on preliminary customer acquisition - the selected Approved Vendor will still be

responsible for the disclosure form and the Part I and Part II applications. However, the Program

Administrator will continue to provide support and guidance to both the customer and the AV

through the entire project application process.

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Each project participating in the pilot will receive

491

See: https://www.chicago.gov/city/en/depts/dgs/supp_info/citywide_maps.html.

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This clarification of the support offered by the Program Administrator is pursuant to the Commission’s Final Order approving this Plan.

See Docket No. 22-0231, Final Order dated July 14, 2022 at 116.

Illinois Power Agency 2022 Long-Term Plan (Final) August 23, 2022

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a REC delivery contract with either a utility or the Agency and must comply with all other program

requirements and rules.

The Pilot broadly seeks to ease the soft costs of customer acquisition for the Approved Vendor, which

commenters have identified as a key point of difficulty thus far in the program.

8.5.4. Low-Income Large Multifamily Solar

As detailed in Section 8.5.3 above, the Low-Income Large Multifamily Solar sub-program separated

incentives for distributed generation projects serving residential facilities with five or more units,

which were previously included in the Low-Income Distributed Generation sub-program, into a

separate sub-program, the Low-Income Large Multifamily Solar sub-program.

As with the Low-Income Single-Family and Small Multifamily Solar sub-program, the Low-Income

Large Multifamily Solar projects must meet requirements of the Adjustable Block Program, as well

as the additional low-income consumer protections outlined in Chapter 9 and Section 8.11. As with

all Illinois Solar for All sub-programs, 25% of available funding in this sub-program will be targeted

to environmental justice communities and 25% will be targeted to Energy Sovereignty projects that

result in ownership by eligible customers.

Despite being separate sub-programs, Public Act 102-0662 provided a single budget allocation to be

shared with the new Low-Income Single and Small Family Solar sub-program. The Agency proposes

to allocate that funding evenly between the two sub-programs for the first nine months of the

program year.

If, at the end of the ninth month of the program year, there were remaining funds in the carveout,

those would be released for projects of any size from either sub-program, and any funds of the total

sub-program budget that remain unobligated at the end of the program year will be rolled into the

following program year’s sub-program budget.

8.5.4.1. Eligibility

To verify program eligibility for five-unit and larger residential buildings, either at least 50% of the

tenants must be verified as low-income, or the building must be demonstrated to meet the definition

of “affordable housing” contained in the Illinois Affordable Housing Act.

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In addition to projects

being eligible based on household income, projects developed on homes or buildings that qualify for

US Department of Housing and Urban Development (“HUD”) Project-Based Vouchers or Project-

Based Rental Assistance (which are programs for housing units dedicated to low-income tenants)

also qualify. The income qualification levels required for participation in these programs are lower

than income requirements for the Illinois Solar for All Program.

8.5.4.2. Incentive Level

As discussed in Section 7.5, these REC prices are based on an update of the REC Pricing model

developed for this 2022.

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See Section 8.10.3.2 for more information on income eligibility (including a required commitment for owners of multi-family buildings).

Illinois Power Agency 2022 Long-Term Plan (Final) August 23, 2022

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Table 8-4: Incentives for the Low-Income Large Multifamily Solar Program($/REC)

System Size

Group A

Change from Initial and

First Revised Plan

Prices

Group B

Change from Initial

and First Revised Plan

Prices

≤10 kW

$106.87

-9.1%

$115.50

-2.3%

>10 - 25 kW

$88.31

-17.5%

$97.05

-9.8%

>25 - 100 kW

$73.26

-16.5%

$79.36

-10.1%

>100 - 200 kW

$74.04

-0.8%

$76.40

1.5%

>200 - 500 kW

$67.95

-0.9%

$70.82

2.4%

>500 – 2,000 kW

$66.40

1.7%

$65.51

-0.6%

2,000 kW – 5,000

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$56.54

N/A

$51.31

N/A

To encourage Energy Sovereignty, an additional $10 per REC would be added for projects that result

in ownership by the customer.

These incentive payments are intended to be sufficient to provide tangible economic benefits to

participants through enabling project developers to eliminate upfront costs to the participants for

the installation of photovoltaic projects. The REC price is a standard incentive for the contractually

obligated delivery of a renewable energy credit and not customized for each project.

8.5.4.3. Demonstrating Tangible Economic Benefits for Residents of

Multi-family Buildings

Section 1-56(b)(2) requires that the Illinois Solar for All incentives deliver tangible economic benefits

for eligible low-income customers, including those that live in multi-family buildings. Multi-family

buildings can be either master metered or individually metered. For master-metered buildings, the

economic benefits of installing a photovoltaic system will not directly impact the occupants of the

building because they do not individually pay an electric bill to their electric utility; instead, the

benefits accrue to the building owner/manager. For this 2022 Plan, the Agency clarifies that for

master-metered building owners to be eligible for the Low-Income Single and Small Multifamily Solar

and the Low-Income Large Multifamily Solar categories, the building owner/manager will need to

commit to passing along the value of at least 50% of the energy savings from net metering to tenants

in tangible ways: reduced (or not raised) rents; new staff that serves all tenants; facility upgrades

(excluding repairs and renovations necessary to maintain building codes or organization

certifications); new equipment that serves all tenants; or other payments, benefits, or services to all

tenants that would not otherwise have been possible without the savings generated by the

photovoltaic system. These benefits must be made available to all the tenants, regardless of income

level or individual participant uptake. Additionally, the building owner/manager will communicate

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The maximum size for projects was increased from 2M to 5 MW through Public Act 102-0662 and REC Prices have now been developed

for this size category.

Illinois Power Agency 2022 Long-Term Plan (Final) August 23, 2022

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to all residents those benefits and how they resulted from the installation of solar. The building

owner/manager shall demonstrate the commitment to pass along the full value of the required

savings to residents by describing in detail how this will be accomplished.

How the ownership benefits are managed for projects located at large multifamily buildings that

create energy sovereignty will vary depending on the ownership model of the building. Cooperative

housing and condominiums have an inherent ownership model for occupants, but for rental buildings

the Agency assumes that ownership of the solar project will likely be retained by the building owner,

and not the rental tenants. Since ownership will facilitate long-term financial benefits, the Agency

encourages building owners to consider how benefits of ownership can be extended to tenants over

the life of the system and will be required to present a plan to address this issue if the applicant seeks

to qualify for an energy sovereignty adder.

One challenge to multi-family buildings that are not master-metered is that the photovoltaic system

will most likely be connected to the main building account that serves common areas and building-

wide load rather than to any individual unit’s account. For these buildings, the owner/manager must

either provide the same demonstration of passing along benefits to all tenants as for master-metered

buildings or, in the alternative, must make available to all tenants the opportunity (at no additional

upfront cost levied by the landlord) to participate in net metering pursuant to the provisions of

Section 16-107.5(l)(1)(B) of the PUA, which allows for net metering of “individual units, apartments,

or properties located in a single building that are owned or leased by multiple customers and

collectively served by a common eligible renewable electrical generating facility.” In this instance,

the project will utilize the interconnecting utility’s applicable net metering tariff, which will require

the Illinois Solar for All Approved Vendor to maintain system shares for all participating

tenants/meters. The net metering bill credit in this instance will be supply-only and costs/savings

will be based on this net metering value.

8.5.5. Low-Income Community Solar Project Initiative

This sub-program or initiative is intended to support participation in community solar by low-

income subscribers. To qualify for this initiative, community solar projects must meet the

requirements for community renewable generation projects outlined in the Act and beyond those

applicable community solar projects that participate in the Adjustable Block Program. These include

the following provisions contained in Section 1-56(b)(2)(B) of the IPA Act:

• [E]ach project shall identify its partnership with community stakeholders regarding the

location, development, and participation in the project, provided that nothing shall preclude a

project from including an anchor tenant that does not qualify as low-income. …

• It is a goal of this program that a minimum of 25% of the incentives for this program be

allocated to community photovoltaic projects in environmental justice communities.

• The Agency shall reserve a portion of this program for projects that promote energy sovereignty

through ownership of projects by low-income households, not-for-profit organizations

providing services to low-income households, affordable housing owners, or community-based

limited liability companies providing services to low-income households.

For the first provision, Illinois Solar for All Approved Vendors’ project applications must include a

description of a partnership with community stakeholders in the community where the project will

be located applicable to that project. While the Act does not define the term “community

Illinois Power Agency 2022 Long-Term Plan (Final) August 23, 2022

252

stakeholders,” the National Community–Based Organization Network (NCBON) defines a

community-based organization as one in which:

• The majority of the governing body and staff consists of local residents,

• The main operating offices are in the community,

• Priority issue areas are identified and defined by residents,

• Solutions to address priority issues are developed with residents, and

• Program design, implementation, and evaluation components have residents intimately

involved, in leadership positions.

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The Agency will consider entities that demonstrate that they meet this definition as being able to

represent community stakeholders in a partnership. Furthermore, the Agency believes the intent of

the Act was to create substantial partnerships, going beyond just holding a few community meetings.

In addition to information regarding location, development and participation, these partnerships

should include a description of how the partnership shows that it is responsive to the priorities and

concerns of low-income members of the community.

In its Initial Plan, the Agency proposed that a public entity may qualify as a community-based

organization for this purpose, but only if the public entity meets the following requirements:

• The public entity must represent a municipality or county (or school district, park district,

etc.) in a municipality or county in the bottom 25% of the state by population.

• The public entity must certify that no local community-based organizations exist that are

capable of filling this role.

• The public entity must provide the same showing of robust community engagement as a non-

public entity would be required to show.

• Public entities that have failed to act as community-based partners in a past project

certification would be ineligible.

The public entity would be qualified as a “community-based organization” only in the context of one

project application; the qualification would not be retained for a future project application (the public

entity would need to demonstrate the same factors again). Finally, the public entity must provide

ongoing reporting of its engagement approach, including public participation opportunities and

disclosure of its approach to the project location selection (if applicable).

If the proposed project has an anchor tenant that does not qualify as a low-income residential

household, the application shall describe that anchor tenant in detail; the Illinois Solar for All

incentive will be reduced to account for the share of the system subscribed by that tenant not

receiving a low-income incentive. As approved in the First Revised Plan, for any anchor tenant, that

reduction is achieved by pricing the non-low-income anchor tenant share at the equivalent applicable

Adjustable Block Program REC price (non-profit or public anchor tenants no longer qualify for the

higher ILSFA price). A project may only have one anchor tenant, and that anchor tenant must be

identified at the time of application.

495

National Community–Based Organization Network (NCBON), “What is a Community–Based Organization (CBO)?”

https://sph.umich.edu/ncbon/about/whatis.html.

Illinois Power Agency 2022 Long-Term Plan (Final) August 23, 2022

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Prior to the enactment of Public Act 102-0662 and the adoption of updated net metering tariffs

resulting from that Act, community solar customers in Illinois received credit on their electricity bills

for their community subscriptions, but received a separate bill from their community solar providers

to pay for those subscriptions (if applicable). Program participants have reported that “dual billing”

can be off-putting to potential ILSFA customers, posing a significant barrier for low-income

customers considering community solar.

However, under newly enacted Section 16-107.5(l)(4) of the Public Utilities Act,

496

most community

solar projects in Illinois can now request that a utility "include a subscriber's subscription fee on the

subscriber's monthly electric bill and provide the subscriber with a net credit equivalent to the total

bill credit value for that generation period minus the subscription fee, provided the subscription fee

is structured as a fixed percentage of bill credit value."

With this net crediting approach, both the cost and value of the community solar subscription will

appear on a single utility bill, helping reduce confusion. In light of this change, the Agency will require

future applicants to this subprogram to use single-bill net crediting. As the law provides:

The net crediting agreement shall set forth payment terms from the electric utility to the owner

or operator of the community renewable generating project, and the electric utility may charge

a net crediting fee to the owner or operator of a community renewable generating project that

may not exceed 2% of the bill credit value.

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This shall not apply to an electric utility serving 200,000 customers or fewer as of January 1, 2021.

In the litigation surrounding the approval of this Plan, some parties raised concerns that the required

use of single-bill net crediting for low-income community solar may discourage Approved Vendors

from offering LICS projects due to a perceived higher risk of non-payment. The Agency proposed in

its Response, and the Commission approved,

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a commitment to monitor the pace of project

application and development in the Low-Income Community Solar sub-program. If the Agency

witnesses a significant decline in project applications, it will request stakeholder feedback on making

the single-bill net crediting requirement optional.

In order to encourage projects that have deep community connections, the project selection protocol

(see Section 8.10.2) reflects the following prioritization in project selection:

• Projects for which the anchor tenant is a non-profit or public facility critical service provider

and also the project host;

• Projects for which the anchor tenant is a non-profit or public facility that is not a critical

service provider and is also the project host;

• Projects for which the anchor tenant is a non-profit or public facility critical service provider

but not the project host;

• Projects for which the anchor tenant is a non-profit or public facility that is not a critical

service provider but not the project host;

Projects for which the anchor tenant is not a non-profit or public facility.

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220 ILCS 5/16-107.5(d)(4).

497

220 ILCS 5/16-107.5(k)(4).

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See Docket No. 22-0231, Final Order dated July 14, 2022 at 115.

Illinois Power Agency 2022 Long-Term Plan (Final) August 23, 2022

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To qualify for any preference in project selection for a project with an anchor tenant, the anchor

tenant subscription must be at least 10% of the project size (and, by law, may not be more than 40%).

For this 2022 Long-Term Plan, the Agency clarifies that for master-metered low-income residential

housing programs to be eligible to subscribe as an anchor tenant of a Low-Income Community Solar

project, the building owner/manager will need to commit to passing along the value of at least 50%

of the energy savings realized from their anchor subscription to tenants in tangible ways. Because

the net metering bill credit in this instance will be supply-only, costs/savings will be based on this

net metering value. Options for methods of passing benefits to residents include: reduced (or not

raised) rents; new staff that serves all tenants; facility upgrades (excluding repairs and renovations

necessary to maintain building codes or organization certifications); new equipment that serves all

tenants; or other payments, benefits, or services to all tenants that would not otherwise have been

possible without the savings generated by the photovoltaic system. These benefits must be made

available to all the tenants, regardless of income level or individual participant uptake. Additionally,

the building owner/manager will communicate to all residents those benefits and how they resulted

from the installation of solar. The building owner/manager shall demonstrate the commitment to

pass along the full value of the required savings to residents by describing in detail how this will be

accomplished.

As described in Section 8.12.4, 25% of available funding in this sub-program will be targeted to

projects in environmental justice communities.

As specified in Section 8.5.1, community solar projects that involve energy sovereignty will be given

a scoring preference in the application process, with a minimum of 25% of ILSFA community solar

funding reserved for such projects. Section 8.5.1.2 describes possible ownership models for low-

income community solar projects, such as ownership in shares of a community solar cooperative and

customer ownership of a portion of a remotely-sited community solar project.

8.5.5.1. Incentive Level

As discussed in Section 7.5, these REC prices are based on an update of the REC Pricing model

developed for this 2022 Plan. Note that these prices now are inclusive of the small subscriber adder

as discussed in Section 7.9.6.2.

Illinois Power Agency 2022 Long-Term Plan (Final) August 23, 2022

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Table 8-5: Incentives for Low-Income Community Solar Projects ($/REC)

System Size

Group A

Change from

Initial and

First Revised

Plan Prices

499

Group B

Change from

Initial and

First Revised

Plan Prices

500

≤ 25 kW

$94.50

-15.6%

$104.81

-4.3%

>25 - 100 kW

$98.75

5.8%

$109.13

20.2%

>100 - 200 kW

$101.09

25.2%

$110.76

41.6%

>200 - 500 kW

$96.10

28.5%

$106.32

47.2%

>500 – 2,000 kW

$87.49

22.7%

$96.43

40.3%

2,000 kW – 5,000

501

$78.01

N/A

$83.80

N/A

As mentioned above, the Agency will give a preference to ILSFA Low-Income Community Solar

applications that result in energy sovereignty (ownership by eligible customers), and reserve a

minimum of 25% of funds for such projects. If an insufficient number of Energy Sovereignty awards

are made to meet the 25% set-aside within nine months after the deadline for program applications,

any remaining funds will be made available to community solar projects that do not feature energy

sovereignty.

Upfront costs should be limited to encourage participation by low-income customers.

These incentives for Low-Income Community Solar Projects are for the portion of the project

subscribed to by households who have been verified as low-income. In order to receive the incentive

at the time of energization, the Approved Vendor will have to verify the level of low-income

subscribers to the project as outlined Section 8.10.4.1. The Agency notes that the Adjustable Block

Program only requires 50% of subscribers (in kW volume) to be identified at the time of energization,

and that small subscriber adders are granted only if the project meets the small subscriber level after

one year of operation. This principle applies to Illinois Solar for All’s Low-Income Community Solar

Project Initiative as well. Only 50% of the low-income subscribers will need to be identified by the

time the project is energized to receive payment under the REC delivery contract; however, the total

amount of that incentive payment will be prorated to the anchor and low-income subscription levels

at the time of energization. After one year, a payment adjustment shall potentially be made based

upon the anchor and low-income subscription level achieved by that time.

To ensure ongoing subscription levels by low-income subscribers, the Approved Vendor will have to

provide ongoing collateral for ten years equal to 5% of the remaining REC value and report annually

499

The comparison to prior REC prices includes the 50% small subscriber adder for those prior prices.

500

The comparison to prior REC prices includes the 50% small subscriber adder for those prior prices.

501

The maximum size for projects was increased from 2M to 5 MW through Public Act 102-0662 and REC Prices have now been developed

for this size category.

Illinois Power Agency 2022 Long-Term Plan (Final) August 23, 2022

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on low-income subscription levels. If those levels are not maintained, then the collateral may be

called upon to claw back the incentives to the level of low-income subscription.

8.5.6. Incentives for Non-Profits and Public Facilities

Section 1-56(b)(2)(C) of the Act specifies that “non-profits and public facilities” are eligible to receive

incentives for on-site photovoltaic generation. These incentives are designed to “support on-site

photovoltaic distributed renewable energy generation devices to serve the load associated with not-

for-profit customers and to support photovoltaic distributed renewable energy generation that uses

photovoltaic technology to serve the load associated with public sector customers taking service at

public buildings.”

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The Act does not provide what specific non-profit organizations or public sector

customers may be eligible.

8.5.6.1. Eligibility

Given that the objective of the Illinois Solar for All Program is in part “to bring photovoltaics to low-

income communities,”

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it is reasonable to infer that only non-profits and public sector customers

that in some manner serve low-income communities should be eligible. However, the Act could also

be interpreted such that all non-profits and public facilities would be eligible to participate. Because

current funding levels are such that only a few large projects might make up the whole of the Non-

Profit/Public Facilities budget in a single program year, focusing available funds on low-income and

environmental justice communities to align with the legislative objectives has been the Agency’s

approach.

To balance these objectives, initially Illinois Solar for All Approved Vendors will have to demonstrate

that the project:

1. Meets the standards described in Section 8.9 related to projects having sufficient connection

to, and input from, low-income community members;

2. Is sited within an environmental justice community

504

or low-income community;

505

3. Serves the electricity load of a building that is occupied by an organization that is a critical

service provider for the community

506

(e.g., youth centers, hospitals, homeless shelters,

senior centers, community centers, places of worship); if a public facility, the building must

host a department/agency that is a critical service provider meeting this standard; and

4. The Approved Vendor must either certify that the project’s owner will not apply for the

federal Investment Tax Credit in relation to the project installation, or if it will apply for the

Investment Tax Credit, then the savings level for the participating host of the project must be

65% of energy value rather than 50%.

As described in Section 8.12.4, 25% of available funding in this sub-program will be targeted to

environmental justice communities, and 25% will be targeted for energy sovereignty projects that

result in ownership by eligible customers.

502

20 ILCS 3855/1-56(b)(2)(C).

503

20 ILCS 3855/1-56(b)(2).

504

As defined by the methodology outlined in Section 8.12.2 of this 2022 Plan.

505

A “low-income community” for this purpose is defined as a census tract where at least half of households are not exceeding 80% of AMI.

506

If the building is not owned by the organization or public agency, then either a lease with at least five years remaining on it, or a

commitment by the building owner to lease the facility to a critical service provider for at least five years must be provided.

Illinois Power Agency 2022 Long-Term Plan (Final) August 23, 2022

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New language in Section 1-75 established a category in the Adjustable Block Program specifically to

serve public schools. Considering the creation of that new Adjustable Block Program category as well

as the ongoing high interest in the subprogram that has exceeded available funding, the Agency will

not include public schools in the Non-Profit/Public Facilities sub-program after the 2022-2023

program year. The Agency will allow participation for the 2022-2023 program year in recognition

that there may be projects already under development that are using the financing assumptions of

the Illinois Solar for All program (e.g., payments upon energization) rather than the 20-year pay-as-

RECs-are-delivered model that is included in the Adjustable Block Program. Similarly, Public Act

102-0662 also created a specific sub-program to serve multifamily residential distributed generation

projects. The Agency will also no longer allow distributed generation projects serving multifamily

residential facilities to participate in the Non-profit/Public Facilities sub-program since these types

of projects qualify to apply for the Low-Income Large Multifamily Solar sub-program. The Agency

also notes that the REC Prices proposed in this 2022 Plan are higher in the Low-Income Large

Multifamily Solar sub-program than in the Non-Profit and Public Facility sub-program so this change

is likely to have minimal impact.

The Agency will otherwise maintain its current definition of a Critical Service Provider as a non-profit

or public entity that offers critical services to low-income or environmental communities. A list of

accepted service provider types will continue to be maintained in the ILSFA Approved Vendor

Manual, and requests for consideration by entities not on that list will be reviewed by the Agency on

a case-by-case basis.

8.5.6.2. Incentive Level

As discussed in Section 7.5, these REC prices are based on the updated REC Pricing model as

approved by the ICC in its Final Order dated July 14, 2022.

Table 8-6: Incentives for Non-Profits and Public Facilities ($/REC)

System Size

Group A

Change from

Initial and

First Revised

Plan Prices

Group B

Change from

Initial and First

Revised Plan

Prices

≤ 25 kW

$100.76

-29.3%

$114.60

-20.0%

>25 - 100 kW

$104.21

-12.1%

$114.05

-4.4%

>100 - 200 kW

$104.82

1.9%

$109.82

6.1%

>200 - 500 kW

$98.15

2.7%

$104.03

8.0%

>500 - 2,000

$96.39

4.9%

$97.71

6.2%

2,000 kW –

5,000 kW

507

$85.22

N/A

$80.19

N/A

507

The maximum size for projects was increased from 2M to 5 MW through Public Act 102-0662 and REC Prices have now been developed

for this size category.

Illinois Power Agency 2022 Long-Term Plan (Final) August 23, 2022

258

As with Community Solar, the Agency will give preference to applications for Non-Profits and Public

Facilities that result in energy sovereignty (ownership by eligible customers), and will reserve a

minimum of 25% of funds for such projects. If the number of Energy Sovereignty awards do not meet

the 25% set-aside within nine months after the deadline for program applications, any remaining

funds will be made available to non-profit and public facility projects that do not feature energy

sovereignty.

8.5.7. Low-Income Community Solar Pilot Projects

Public Act 99-0906 established a sub-program for Low-Income Community Solar (“LICS”) Pilot

Projects, to test approaches to serving eligible customers. The law specified that projects must

provide economic benefits for members of the community where the project is located and include a

partnership with at least one Community Based Organization.

The LICS Pilot procurement process was conducted by the Agency’s Procurement Administrator, who

handled the intake and evaluation of all project proposals, and made recommendations for bid

approval to the ICC. Two pilot projects were awarded REC contracts totaling $20 million in the fall of

2019, with an average REC price of $72.02. As of March 2022, the projects had not been fully

subscribed.

Public Act 102-0662 removed the Low-Income Community Solar Pilot Procurement sub-program

from Section 1-56 of the IPA, so no further procurement will be conducted.

8.6. Illinois Solar for All Program Administrator

The Program Administrator for the Illinois Solar for All Program was selected via a two-part Request

for Qualifications/Request for Proposals process conducted by the Agency in 2018, which culminated

in Commission approval of the contract for Elevate Energy to serve as the ILSFA Program

Administrator on September 14, 2018 for a period of two years, with the option for annual renewal

for up to three additional years. Revisions to 1-56(b)(2)(5) of the IPA Act clarify that the Illinois Solar

for All Program Administrator “may be, but need not be, the same administrator as for the Adjustable

Block Program.” The Agency issued a new Request for Qualifications on August 8, 2022, and expects

to issue a Request for Proposals in late 2022.

The obligations of the Illinois Solar for All Program Administrator expanded under revisions to

Section 1-56(b)(5) by Public Act 102-0662, which now include at minimum:

• Take applications and verify project eligibility in Illinois Solar for All and coordinate this

information with the Adjustable Block Program Administrator (who will process the actual

generation of contracts). This includes, but is not limited to, review of project technical

specifications, income verification, review of community involvement in projects, review of

job training coordination, and review of Illinois Solar for All consumer protections such as

verification of ensuring tangible economic benefits flow to low-income participants. Illinois

Solar for All administrative procedures will be as similar to those of the Adjustable Block

Program as possible, to reduce administrative burden on Approved Vendors that serve both

programs.

Illinois Power Agency 2022 Long-Term Plan (Final) August 23, 2022

259

• Act as the centralized source for income verification and maintain database of program

participants.

• Assist in the development of contracts, disclosure forms, and brochures for use by Illinois

Solar for All Approved Vendors and their partner community-based organizations.

• Coordinate the distribution of funding for grassroots education efforts by community-based

organizations. A priority for this funding will be to promote the availability of the Illinois

Solar for All Program in Environmental Justice Communities to achieve the goal of 25% of the

incentives being allocated to those communities.

• Facilitate Illinois Solar for All Approved Vendors meeting the additional requirements of the

Illinois Solar for All Program. In particular, the Program Administrator acts as a liaison

between Illinois Solar for All Approved Vendors participating in the programs and

organizations providing job training. The Program Administrator will also work to inform

Illinois Solar for All Approved Vendors of energy efficiency, weatherization, lead abatement,

and other program opportunities that could provide additional benefits to participants.

• Provide guidance and education to Illinois Solar for All Approved Vendors, community

groups, local government agencies, and others on how to leverage other governmental

policies to facilitate low-income solar projects and energy efficiency programs. Other

relevant policies include affordable housing, economic development, public finance, and tax

policies, at the federal, state, and local level. The Administrator will act as liaison with other

governmental agencies that administer such programs to facilitate their use on solar

development.

• Provide Program Manual and related materials for use by Illinois Solar for All Approved

Vendors.

• Provide reports to the Agency and the Commission on a quarterly basis on the status of the

Program including, but not limited to, number of applications received, number of

applications approved, number of projects completed, REC payments, payments for and

status of grassroots education efforts (if applicable), and a summary of technical assistance

provided.

• Facilitate “placement for graduates of Illinois-based renewable energy-specific job training

programs, including the Clean Jobs Workforce Network Program and the Illinois Climate

Works Preapprenticeship Program administered by the Department of Commerce and

Economic Opportunity, along with other programs administered under Section 16-108.12 of

the Public Utilities Act.”

508

20 ILCS 3855/1-56(b)(5).

Illinois Power Agency 2022 Long-Term Plan (Final) August 23, 2022

260

• “[D]evelop a web-based clearinghouse for information available to both job training program

graduates and firms participating, directly or indirectly, in Illinois solar incentive

programs.”

509

• “[C]oordinate … activities with entities implementing electric and natural gas income-

qualified energy efficiency programs, including customer referrals to and from such

programs, and connecting prospective low-income solar customers with any existing

deferred maintenance programs where applicable.”

510

8.7.

Quality Assurance

Due to the higher incentive level that Illinois Solar for All projects will receive compared to those that

participate in the Adjustable Block Program, as well as the additional vulnerabilities that program

participants may face, it is especially important for the Agency to ensure that projects are properly

installed and produce their expected amounts of energy. In conjunction with the Program Evaluator

(as described in Section 8.14), the Illinois Solar for All Program Administrator has developed and

implemented a process for quality assurance, including assessing 1) the suitability of sites for solar

installation and/or the proper planning for mitigating site deficiencies before installation, 2) a

thorough photo documentation of all projects while under construction, and 3) on-site inspection of

a random sample of installations. If installations are found to have deficiencies or nonconformance

with specifications from the application, the Illinois Solar for All Approved Vendor, at its own

expense, will be responsible for any repairs, alterations, or additions to remedy the deficiencies. A

deficient project may be removed from the Program if already contracted. Illinois Solar for All

Approved Vendors who have a disproportionately high number of deficient systems may lose their

eligibility to continue to participate in the Illinois Solar for All Program. The Agency continues to

work with the Program Administrator to streamline these quality assurance processes.

8.8. Coordination with Other Programs

Public Act 102-0662 requires that Illinois Solar for All “be implemented in a manner that seeks to

minimize administrative costs and maximize efficiencies and synergies available through

coordination with similar initiatives, including the Adjustable Block Program..., energy efficiency

programs, job training programs, and community action agencies."

511

It creates a number of new programs that interact with Illinois Solar for All, as described below.

8.8.1. Job Training and Placement Programs

Public Act 102-0662 expanded on the job training and placement programs initiated under Public

Act 99-0906. Those programs now include the Clean Jobs Workforce Network Program, the Illinois

Climate Works Pre-apprenticeship Program, Returning Residents Clean Jobs Program, Clean Energy

Contractor Incubator Program, Clean Energy Primes Contractor Accelerator Program, and the Energy

Transition Barrier Reduction Program. It creates three Regional Administrators (North, Central, and

South) to administer the implementation of the programs.

509

Id.

510

Id.

511

Section 1-56(b)(2).

Illinois Power Agency 2022 Long-Term Plan (Final) August 23, 2022

261

While these programs are to be designed and implemented under the guidance of DCEO, they have a

number of implications for the Illinois Solar for All program, as the source of trainees required for

program job training requirements, as detailed in Section 8.9.1.

Section 1-56(b)(2) of the Act contains two provisions that are designed to ensure that the job trainees

supported by the job training programs participate in the installation of photovoltaic projects

supported by the program. The first of these requirements is aspirational in nature, while the second

is more specific.

The first provision is that “[p]rojects must include job training opportunities if available, with the

specific level of trainee usage to be determined through the Agency’s long-term renewable resources

procurement plan, and the Illinois Solar for All Program Administrator shall coordinate with the job

training programs described in paragraph (1) of subsection (a) of Section 16-108.12 of the Public

Utilities Act and in the Energy Transition Act.”

512

This program is known as the “solar training

pipeline program.” The job training program is to be “designed to ensure that entities that offer

training are located in, and trainees are recruited from, the same communities that the program aims

to serve and that the program provides trainees with the opportunity to obtain real-world

experience.”

513

Prior to Public Act 102-0662, Section 1-75(c)(1)(O) authorized $10,000,000 of ComEd’s RPS Budget

to be allocated to fund solar job training programs pursuant to Section 16-108.12 of the PUA every

four years, beginning with the 2017-2018 delivery year. P.A. 102-0662 revised Section 1-

75(c)(1)(O), now requiring that “[f]or the delivery years beginning June 1, 2021, June 1, 2024, June

1, 2027, and June 1, 2030” – every three years– “$10,000,000 shall be provided to the Department of

Commerce and Economic Opportunity to implement the workforce development programs and

reporting as outlined in Section 16-108.12 of the Public Utilities Act.” (Emphasis added.) However,

Section 16-108.12 of the Public Utilities Act still directs the utilities to spend $3,000,000 in each of

2021, and 2025 to train installers for the solar projects authorized and contemplated under the

Illinois Solar for All program and other RPS programs.

514

On December 13, 2021, ComEd petitioned the Commission to reopen Docket No. 17-0332, seeking

for its prior-approved workforce development plan to be “modified to address (i) DCEO’s new role

as the implementer of the Section 16-108.12 workforce development programs (and termination of

ComEd’s implementer role), (ii) ComEd’s remittance of funding to DCEO for the applicable delivery

year, and (iii) any administrative activities that ComEd will continue to perform in support of the

workforce development programs now implemented by DCEO.” That petition to reopen was

unanimously granted by the Commission on December 16, 2021. On March 3, 2022, the Illinois

Commerce Commission approved the joint proposed order filed by ComEd and DCEO which

stipulates that ComEd will continue funding the Craft Apprenticeship Program and the Multi-Cultural

Jobs Program through the end of the defined Transition Period, and that DCEO will issue a new RFP

for the Solar Training Pipeline Program.

515

512

20 ILCS 3855/1-56(b)(2).

513

220 ILCS 5/16-108.12(a)(1).

514

The responsibility to administer these programs resided with ComEd prior to the enactment of Public Act 102-0662.

515

Final Order on Reopening, Docket 17-0332 at 8 (March 3, 2022).

Illinois Power Agency 2022 Long-Term Plan (Final) August 23, 2022

262

The availability of job training opportunities for Illinois Solar for All projects depends, in part, on the

availability of graduates of the solar training pipeline program. As of the filing of this final 2022

Long-Term Plan, DCEO has awarded grants to five providers of the Solar Training Pipeline program.

DCEO expects to issue contract awards for the Multi-Cultural Jobs Program in early fall of 2022.

Second, as added to Section 1-56(b)(2) by Public Act 102-0662, all Illinois Solar for All sub-program

descriptions direct that “[c]ompanies participating in this program that install solar panels shall

commit to hiring job trainees for a portion of their low-income installations” and further that, “an

administrator shall facilitate partnering the companies that install solar panels with entities that

provide solar panel installation job training.”

516

ComEd stated in the ICC proceeding reviewing its Section 16-108.12 job training plan that it intends

to implement the Solar Craft Apprenticeship Program in coordination with the International

Brotherhood of Electrical Workers (“IBEW”) Local 134, which will integrate solar training curricula

into its existing electrical craft/trade/skill apprenticeship programs at 18 IBEW sites as well as

certain community colleges and high schools.

517

According to the Plan submitted by ComEd in that

proceeding, the Solar Craft Apprenticeship Program appears to include training locations located

across the entire State, and not just in ComEd’s service territory.

518

This program may be essential

for ensuring the availability of job trainees across the State. ComEd has released a report detailing

the status of its job training programs under Section 16-108.12 annually since 2019.

519

Beginning

July 1, 2022, ComEd has ceased all funding and oversight of these workforce training programs. DCEO

has awarded the Solar Craft Apprenticeship Program contract to IBEW, and the Agency will continue

to coordinate with DCEO to ensure alignment with the implementation of these programs and Illinois

Solar for All.

In 1-56(b)(5), Public Act 102-0662 further instructs that, “To increase the update of trainees by

participating firms, the administrator shall also develop a web-based clearinghouse for information

available to both job training program graduates and firms participating, directly or indirectly, in

Illinois solar incentive programs.” The Illinois Solar for All Program Administrator is coordinating

with the entities providing job training to maintain a clearinghouse of information that Illinois Solar

for All Approved Vendors can use to identify potential job training program graduates to hire. ComEd

administers a FEJA Jobs portal (https://fejajobs.vouchedin.com/) where graduates of its job training

programs created under Section 16-108.12 of the Public Utilities Act can post their resumes and

employers can post opportunities for jobs and specific projects. The Program Administrator has

provided training to Illinois Solar for All Approved Vendors on how to access and use this portal, and

will continue to work with the organizations receiving statutorily-authorizing funding to provide job

training in an ongoing effort aimed at encouraging participation in the FEJA Jobs portal by those

programs’ graduates.

The Agency and its Program Administrator(s) do not run the job training programs, and therefore,

the Agency has limited ability to ensure the success of those programs in effectively training new

516

20 ILCS 3855/1-56(b)(2)(A), (B), (C) and (E).

517

Docket No. 17-0332, ComEd Ex. 1.0 at 12.

518

Id. at 13.

519

The reports are available at https://www.icc.illinois.gov/docket/P2017-0332/documents.

Illinois Power Agency 2022 Long-Term Plan (Final) August 23, 2022

263

workers. Rather, the Agency will seek to ensure that the Illinois Solar for All Program creates

employment opportunities for those new workers, and will track and report data on job placement.

8.8.2. Equity and Environmental Justice programs

In Section 5-60 of the Energy Transition Act, Public Act 102-0662 establishes the Jobs and

Environmental Justice Grant Program with two subprograms: the Equitable Energy Future Grant

Program and the Community Solar Energy Sovereignty Grant Program, administered by the DCEO.

The grant programs will make grant awards of up to $1,000,000 per application “to provide

businesses, organizations, and community groups with capital needed to plan, develop, and execute"

a renewable energy or energy efficiency project.

The Jobs and Environmental Justice Grant Program will “coordinate with and supplement existing

incentive programs, such as the Adjustable Block program, the Illinois Solar for All Program, the

community renewable generation projects, and renewable energy procurements as described in the

Illinois Power Agency Act, as well as utility energy efficiency measures as described in Section 8-

103B of the Public Utilities Act."

520

The Equitable Energy Future Grant Program is specifically for

“equity eligible contractors" while the Community Solar Energy Sovereignty Grant Program will

support “the pre-development and development of community solar projects that promote

community ownership and energy sovereignty." The Agency will work with DCEO to ensure

coordination in the implementation of these programs and the Illinois Solar for All Program.

Finally, Public Act 102-0662 enacted the Clean Energy Jobs and Justice Fund Act, which establishes

the Illinois Clean Energy Jobs and Justice Fund, discussed below in conjunction with the Climate Bank.

8.8.3. Energy Efficiency Programs and Community Action Agencies

Section 1-56(b)(2) of the Act provides that the Illinois Solar for All Program "shall be implemented

in a manner that seeks to minimize administrative costs, and maximize efficiencies and synergies

available through coordination with similar initiatives" including energy efficiency programs and

community action agencies (“CAAs”). There are 35 CAAs in Illinois that administer state

weatherization and energy assistance programs.

Public Act 102-0662 amended Section 8-103B(c) of the Public Utilities Act to direct utilities “to

bundle low-income energy efficiency offerings with other programs that serve low-income

households to maximize the benefits going to these households. The utilities shall market and

implement low-income energy efficiency programs in coordination with low-income assistance

programs, the Illinois Solar for All Program, and weatherization whenever practicable."

Section 1-56(b)(8) of the IPA Act, as amended by Public Act 102-0662, instructs:

As part of the development and update of the long-term renewable resources

procurement plan authorized by subsection (c) of Section 1-75 of this Act, the Agency

shall plan for: (A) actions to refer customers from the Illinois Solar for All Program to

electric and natural gas income-qualified energy efficiency programs, and vice versa,

with the goal of increasing participation in both of these programs; (B) effective

procedures for data sharing, as needed, to effectuate referrals between the Illinois Solar

for All Program and both electric and natural gas income-qualified energy efficiency

520

Energy Transition Act, §5-60(b), enacted through Public Act 102-0662 (2021).

Illinois Power Agency 2022 Long-Term Plan (Final) August 23, 2022

264

programs, including sharing customer information directly with the utilities, as needed

and appropriate; and (C) efforts to identify any existing deferred maintenance

programs for which prospective Solar for All Program customers may be eligible and

connect prospective customers for whom deferred maintenance is or may be a barrier

to solar installation to those programs.

The Program Administrator has identified energy efficiency programs and programs to address

deferred maintenance and maintains current information about these resources in Resource Guides

to assist potential Illinois Solar for All Program participants in overcoming barriers to participation.

The Agency and the Program Administrator will work with utilities, administrators of the Low

Income Home Energy Assistance Program (“LIHEAP”) and the Illinois Home Weatherization

Assistance Program (“IHWAP”), and other relevant organizations to develop opportunities to share

referrals between ILSFA and programs that similarly address energy costs and energy burdens of

low-income households and non-profit and public facility participants.

As detailed further in Section 8.15, and as approved by the ICC in its Final Order of July 14, 2022 in

Docket No. 22-0231, the Agency interprets updated language in Section 1-56(b)(3) expanding use of

“other activities deemed to be qualified by the Agency” to allow support for activities driving ILSFA

participation beyond education, and will explore ways it can further support ILSFA outreach

activities.

8.8.4. Climate Bank and the Clean Energy Jobs and Justice Fund

Public Act 102-0662 establishes financial vehicles to aid in the deployment of clean energy. Article

850 of the Illinois Finance Authority Act as enacted by Public Act 102-0662 directs the Illinois Finance

Authority to create a Climate Bank “to aid in all respects with providing financial assistance,

programs, and products to finance and otherwise develop and facilitate opportunities to develop

clean energy and provide clean water, drinking water, and wastewater treatment in the State."

521

While the Climate Bank has not been launched yet, green banks in other states have played an active

role in financing distributed solar. The Connecticut Green Bank, for example, provides a production-

based incentive of 8.1¢ per kWh for low-income customers plus below market-rate debt to

developers to facilitate lower pricing and encourage the participation of market-rate capital

providers.

Section 20-15 of the Illinois Clean Energy Jobs and Justice Fund Act enacted through P.A. 102-0662

creates the Clean Energy Jobs and Justice Fund, a nonprofit corporation. The Fund "has authority to

pursue a broad range of financial products and services"

522

that "foster the development and

commercialization of clean energy projects, including projects serving low-income, environmental

justice, and BIPOC communities, and support project development by MBE and other contractors of

color."

523

The board of the Fund will be appointed by the governor, and Section 20-30(a) of the Illinois

Clean Energy Jobs and Justice Fund Act directs the board of the Fund to consider a number of

investment initiatives, many of which could affect ILSFA, including “a solar lease, power-purchase

agreement, or loan-to-own product specifically designed to complement and grow the Illinois Solar

521

20 ILCS 3501/850-5.

522

Illinois Clean Energy Jobs and Justice Fund Act, §20-30(a), enacted through Public Act 102-0662 (2021).

523

Illinois Clean Energy Jobs and Justice Fund Act, §20-25(a)(2), enacted through Public Act 102-0662 (2021).

Illinois Power Agency 2022 Long-Term Plan (Final) August 23, 2022

265

for All Program.” The Agency will work with the Program Administrator and the board of the Clean

Energy Jobs and Justice Fund to facilitate integration across the programs.

Neither Sections 850-5 of the Illinois Finance Authority Act nor Section 20-20 of the Illinois Clean

Energy Jobs and Justice Fund Act within Public Act 102-0662 prohibits solar developers and other

commercial stakeholders to participate as board members on these bodies, which could create the

potential for a financial conflict of interest if solar developers participating in Illinois Solar for All are

board members of these new entities. The Agency requested stakeholder feedback in November

2021 to explore if additional protections are needed to prevent gaming or undue influence.

Stakeholders commented, and the Agency concurs, that policies to prevent conflict of interest should

be put in place at the two organizations, with disclosure to the Agency and Program Administrator if

those companies participate in Solar For All programs.

8.8.5. Equitable Energy Upgrade Program

Section16-111.10 of the Public Utilities Act as enacted by Public Act 102-0662 directs the Illinois

Commerce Commission to establish the Equitable Energy Upgrade Program, which “permits

customers to finance the construction of energy projects through an optional tariff payable directly

through their utility bill, modeled after the Pay As You Save system, developed by the Energy

Efficiency Institute.”

524

Funds may be used for solar installations and other energy improvements.

The program “shall enable utilities to offer to make investments”

525

or arrange financing from third

parties or from the Illinois Clean Energy Jobs and Justice Fund, established through the Illinois Clean

Energy Jobs and Justice Fund within Public Act 102-0662. The program guidelines should follow the

“Pay As You Save Essential Elements and Minimum Program Requirements,”

526

which requires a

minimum of 20% savings, consumer protections, and other measures. Pay As You Save (“PAYS”) can

be a way to finance ownership of on-site solar, especially for residents of small 1-4 unit buildings,

since repayment is encumbered to the meter, and passes on to any future occupant living in that unit.

While PAYS can work with customers of any income level, there may be synergies to applying it to

customers eligible for the Solar For All program as a way to encourage energy sovereignty.

The Agency looks forward to collaborating with the Commission on ways to integrate the Equitable

Energy Upgrade Program with Illinois Solar for All.

8.8.6. Coordination with programs that support building repairs and

upgrades

ILSFA program participants have reported that some eligible households have been prevented from

participating in the program due to repairs or upgrades needed on their home or building before

solar can be installed.

While the Agency proposes a new pilot program in Section 8.5.3.3 to address costs related to

necessary upgrades to the premises for hosting a solar project, the Agency notes that there are

various other state, federal, and non-profit programs that provide home repairs and upgrades for

eligible households.

524

220 ILCS 5/16-111.10(c).

525

Id.

526

220 ILCS 5/16-111.10(e)(2).

Illinois Power Agency 2022 Long-Term Plan (Final) August 23, 2022

266

The US Department of Housing and Urban Development (HUD) offers such programs, and cites a

number of other agencies and non-profits that provide a range of assistance, including HUD-

approved housing counseling agencies, the Illinois Housing Development Authority, Illinois affiliates

of Habitat for Humanity, U.S. Department of Veterans Affairs Regional Loan Centers, and the USDA

Rural Development Office.

527

The Agency and the ILSFA Program Administrator will reach out to these entities and explore the

potential for coordination between solar installations and home repair programs, and seek to

integrate those opportunities into the ILSFA program.

8.9. Additional Requirements for Illinois Solar for All Approved Vendors

Because the Illinois Solar for All Program (other than the Low-income Community Solar Pilot

Projects) works similarly to the Adjustable Block Program, direct participants must first be approved

as Adjustable Block Program Approved Vendors through the process outlined in Section 7.7.2.

Approved Vendors who seek to submit projects into Illinois Solar for All will additionally have to

become an Illinois Solar for All Approved Vendor.

528

An Approved Vendor that does not achieve this

status will not be eligible to submit projects. A list of Illinois Solar for All Approved Vendors is

available on both the Adjustable Block Program website and Illinois Solar for All website.

The additional requirements for registering to be an Illinois Solar for All Approved Vendor include:

• Description of plans for community involvement in projects (where applicable)

• Plan for inclusion of job training opportunities

• A commitment to hire job trainees for a portion of the projects as described in Section 8.9.1

• Coordination with the Program Administrator on income verification

• Agreement to allow the Program Administrator and Agency to review and approve marketing

materials geared towards the Illinois Solar for All Program

• Agreement to ensure additional consumer protections as described in Section 8.11

• Demonstration for low-income distributed generation and community solar projects that

participants do not have any up-front payments.

The Agency recognizes the importance of equity and minority-/women-owned business enterprise

(“MWBE”) participation in the Illinois Solar for All Approved Vendor cohort and will continue to work

with the Program Administrator to expand MWBE Approved Vendor participation, including direct

outreach to potential MWBE Approved Vendors, as well as partnering with and outreach to equity-

focused industry groups.

Section 1-56(b)(2) of the IPA Act provides that “[p]riority shall be given to projects that demonstrate

meaningful involvement of low-income community members in designing the initial proposals” and

that “[a]cceptable proposals to implement projects must demonstrate the applicant's ability to

conduct initial community outreach, education, and recruitment of low-income participants in the

527

US Department of Housing and Urban Development, Home Repairs: Illinois, accessed March 2022.

528

This includes the option to be an Illinois Solar for All Single Project Approved Vendor similar to the Adjustable Block Program Single

Project Approved Vendor option. The minimum project size would be 50 kW.

Illinois Power Agency 2022 Long-Term Plan (Final) August 23, 2022

267

community.”

529

For community solar projects, applicants must identify partnerships with community

stakeholders. It is less clear how those provisions would apply directly to projects that participate

in either the Low-Income Distributed Generation Incentive sub-program or the Incentives for Non-

profits and Public Facilities sub-program.

To satisfy these provisions, the registration process for the Illinois Solar for All Program will require

Illinois Solar for All Approved Vendors to demonstrate their capacities in this area. An Illinois Solar

for All Approved Vendor will do so by satisfying all of the following requirements:

• Providing narrative summary of efforts taken prior to the application to conduct community

outreach, education, and recruitment

• Listing community-based organizations the applicant has partnered with, including letters

from those organizations to verify the partnerships

• Describing in detail ongoing plans for community outreach, education, and recruitment

• Describing staffing for dedicated outreach, education, and recruitment

• Describing plans for ensuring that tangible economic benefits flow to program participants

• Participating in training offered by the Program Administrator on guidelines for marketing,

contracting, and standard disclosures for program participants

Failure to maintain a demonstrated commitment to these requirements may result in an Illinois Solar

for All Approved Vendor being removed from participating in the Illinois Solar for All Program.

8.9.1. Job Training Requirements

As described in Section 8.8.1, Section 1-56(b)(2) of the Act contains two provisions that are designed

to ensure that the job trainees supported by the job training programs participate in the installation

of photovoltaic projects supported by the program. Section 8.8.1 addresses the first provision’s

instruction to coordinate with job training programs, while this section addresses the second

provision specifying that “[c]ompanies participating in this program that install solar panels shall

commit to hiring job trainees for a portion of their low-income installations.”

530

The Act does not specify what is meant by “a portion” and also does not define who would qualify as

a “job trainee,” The Agency allows for other solar training programs in Illinois to be proposed to the

Program Administrator for consideration as an Other Qualifying Program, as described in 8.8.1. For

the purposes of defining “job trainees, the Agency will consider graduates of both the training

programs created by Section 16-108.12 of the Public Utilities Act as well as designated Other

Qualifying Programs to be considered “job trainees” for the purposes of Illinois Solar for All job

trainee employment requirements, and will be given equal consideration.

To ensure that “a portion” of projects use job trainees, Illinois Solar for All Approved Vendors who

participate will have to demonstrate that at least 33% of projects (on a rolling average basis) include

the use of one or more job trainees from the solar training pipeline program, the craft apprenticeship

program, the multi-cultural jobs program, or training program designated by the Program

Administrator as an Other Qualifying Program.

531

Furthermore, each Illinois Solar for All Approved

529

20 ILCS 3855/1-56(b)(2).

530

20 ILCS 3855/1-56(b)(2)(A), (B), (C) and (E).

531

Prior to the enactment of Public Act 102-0662, this requirement only applied to the Low-income Distributed Generation subprogram.

Illinois Power Agency 2022 Long-Term Plan (Final) August 23, 2022

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Vendor will have to demonstrate that for its first year of participation, 10% of the hours worked on

all projects will be by job trainees, and that amount would increase to 20% in their second year of

participation, and 33% in the third year. The timeline for these increasing annual percentage

requirements will start with the beginning of construction of the Approved Vendor’s first project

contracted under the Program.

Illinois Solar for All Approved Vendors are required to document the use of job trainees by providing

a summary of job trainee work to the Program Administrator; the Program Administrator will track

and report progress on job placements. Illinois Solar for All Approved Vendors may also request to

use job trainees from other job training programs so long as the Approved Vendor can demonstrate

that completion of the job training program would lead to the trainee becoming a “Qualified Person”

under the Part 468 Rule related to the certification of installers of photovoltaic systems (see Section

2.6.2.4 for additional discussion of these requirements). The Agency will consider requests for

waivers of this requirement on a case-by-case basis if an Illinois Solar for All Approved Vendor can

demonstrate that, despite diligent efforts at recruitment, job trainees are not available in the area

where projects are being installed and this would prevent the project from being completed.

8.10. Application Process

8.10.1. Project Submissions and Batches

Except for Low-Income Community Solar Pilot Projects, the process for a project to be submitted to

the Illinois Solar for All Program generally mirrors that for the Adjustable Block Program described

in Section 7.10. Projects are submitted by Illinois Solar for All Approved Vendors through a similar

process as the Adjustable Block Program, but to expedite processing of ILSFA projects there is no

minimum batch size.

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There is no application fee for Illinois Solar for All projects.

Applications will be submitted through the Illinois Solar for All project application portal and will

provide the supplemental information required for Illinois Solar for All beyond that required for an

Adjustable Block Program project.

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If the supplemental information does not demonstrate that the

project qualifies for participation in the Illinois Solar for All Program, the project may still be eligible

to participate in the Adjustable Block Program through a separate application (including the payment

of an application fee), although any such application would be subject to the availability of block

capacity in the Adjustable Block Program. A project may not apply to the Illinois Solar for All Program

if it is included in a batch of Adjustable Block Program projects that have been submitted to the

Commission for approval (or subsequently approved). If a project applies to both programs, the

Illinois Solar for All application will have to be withdrawn at the time the Adjustable Block Program

sends its approval recommendation to the Commission (and vice versa). Additionally, a project may

not apply to two sub-programs of Illinois Solar for All within the same program year.

Like for the Adjustable Block Program, Illinois Solar for All projects will be bundled into one contract

or confirmation for each approved batch. The Agency will request Commission approval for contracts

that include additional Illinois Solar for All provisions. Under this Plan, those contracts will be

executed first with the utilities using the allocation from their Renewable Resources Budgets, and

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In prior Plans the Agency had required a 50 kW minimum batch size but is removing that requirement from the 2022 Long-Term Plan

to help encourage participation by small and emerging businesses.

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A number of program participants have reported difficulty using the ILSFA portal. The Program Administrators of the two programs

will work together to make their portals and processes as simple and uniform as possible.

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then by the Agency using funds from the Renewable Energy Resources Fund. For contracts allocated

to a utility, the Program Administrator will strive to allocate contracts to each utility for projects in

their service territory, and in a manner that will obligate funds at a level consistent with each utility’s

share of funds committed to Illinois Solar for All.

Like the Adjustable Block Program contract process described in Section 6.10.6, an Approved

Vendor’s failure to timely execute a product order will potentially subject that Approved Vendor to

discipline, and the constituent projects will be considered removed from the Illinois Solar for All

Program. Additionally, as discussed in Section 7.11.1 for the ABP, when an Approved Vendor’s

collateral is forfeited under its ILSFA REC contract (if the contract is with a utility), that collateral

amount will be restored to the utility’s Renewable Resources Budget, and if the contract is with the

Agency, that collateral amount would be deposited into the Renewable Energy Resources Fund.

The process for posting collateral will mirror that for the Adjustable Block Program described in

Sections 7.12.2. For a Low-Income Community Solar project that is not yet energized at the time of

Commission approval, the contract value (for purposes of calculating the required collateral posting)

will be based on an assumption that 100% of the project is subscribed by low-income residential

households qualifying as “small subscribers.”

8.10.2. Project Selection for Sub-programs with High Demand

Projects for each sub-program must initially be submitted within pre-determined project submission

windows for each program year. In the case that a sub-program has a large number of applications

such that the funding required for all eligible applications received within the submission window

exceeds that sub-program’s total budget (including RERF funds and utility funds)

534

for that program

year, the Agency will establish a protocol that provides a basis for scoring each individual project

based on attributes that align with the goals of this 2022 Plan and creates a ranking of projects based

on these scores.

535

The highest scoring projects will be selected for funding first, where possible,

ensuring funds prioritize projects that directly meet Plan objectives. One objective of this selection

protocol will be to minimize the use of random tie-breaking as a means of selection.

Attributes that will receive higher scores include:

• Location with an Environmental Justice Community;

• Location within a low-income community (as defined above in Section 0);

• Projects developed by Illinois Solar for All Approved Vendors that are women- or minority-

owned businesses, or small and emerging businesses;

• Preferences for types of subscribers in Low-Income Community Solar projects, as outlined in

Section 8.5.5;

• Preferences for projects that result in ownership by eligible customers or subscribers, as

described in the discussion of Energy Sovereignty in Sections 8.2.4 and 8.5.1; or

• Other attributes that align with Plan priorities.

534

Note that sub-program budgets are adjusted to account for any funds not committed in the previous program year and rolled over,

administrative expenses, and grassroots education costs. Furthermore, the Agency may adjust allocations of utility-supplied funding if

needed.

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This approach has been utilized for the 2018-2019 and 2019-2020 program years. See:

https://www.illinoissfa.com/app/uploads/2019/05/ILSFA-Project-Selection-Protocol.pdf. The Agency expects that an update to the

protocol will include additional granularity in scoring to minimize the likelihood of tied scores that would require random selection of

projects.

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In addition, scoring will be weighted in such a way that helps to ensure a diversity of project

development compared with all projects submitted for a given sub-program. For example, additional

weighting might be given for:

• Geographic location,

• Project size, or

• Other such attributes that reflect a diversity of projects.

The project selection protocol should be executed in a way that ensures that 25% of funds go to

projects located in Environmental Justice communities or to projects that encourage Energy

Sovereignty whenever possible. As discussed in Section 8.12.4 below, the 25% allocation for projects

located in Environmental Justice communities and for projects that encourage Energy Sovereignty

within each sub-program will be held open until the end of each program year.

After each program year’s initial project submission window, if funds for a given sub-program remain

available, project applications will be accepted and reviewed on a first-come, first-served basis for

the remainder of the program year. If annually allocated RERF funds in a sub-program remain at the

end of the program year, the unused funds will be rolled over to the next program year for that sub-

program. Additionally, if funds become available due to the withdrawal of any projects during a

program year and after project selection, those funds may be made available to the next eligible

project on the waitlist for that program year. The waitlist from each program year will not carry over

to the following program year.

If the Part II project approval (e.g., energization verification) results in the final REC contracts value

being revised downward, the funds made available from that revision would be made available

within the applicable sub-programs for consideration by any projects remaining in the waitlist queue

for the current program year. The next eligible project on the general waitlist for that sub-program

would be awarded those funds or given an option to resize the project in proportion to the newly

available funds in a similar fashion to the last projects selected during the project selection process.

Feedback received during the Agency’s July 2021 stakeholder workshop and comment process

expressed preference from stakeholders for additional lead time with visibility into the ILSFA Project

Selection Protocols. Following the passage of Public Act 102-0662, further feedback was sought for

guidance on updating Project Selection Protocols given updates to the legislation. The Agency

understands the importance of consistency of selection protocols for the development cycle and will

update project selection protocols for program year 2022-2023 based on updates to the IPA Act as

outlined in this 2022 Plan. The Project Selection Protocol developed for the 2022-2023 program year

will be maintained without changes for the 2023-2024 program year to promote stability and

certainty for Illinois Solar for All Approved Vendors, with the exception of adding in the new criterion

related to Energy Sovereignty. Any changes to the protocol for the 2024-2025 program year will be

finalized at least six months before the start of the program year.

8.10.3.

Customer Eligibility

Customer eligibility for the Illinois Solar for All Program is partly defined in the Act. Further

refinements are proposed in this section.

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8.10.3.1. Income Guidelines

Section 1-56(b) of the IPA Act states that, as used in that section (and thus for the Illinois Solar for All

Program), “’low-income households’ means persons and families whose income does not exceed 80%

of area median income, adjusted for family size and revised every 5 years.”

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The Agency proposes to use income eligibility guidelines from HUD. HUD bases its housing assistance

programs, such as the Section 8 Housing Choice Voucher program, on 80% of area median income,

adjusted for family size.

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Because the Act does not define “area,” the Agency is proposing to use HUD’s definition of an area as

a Metropolitan Statistical Area (MSA), a Fair Market Rate (FMR) Area, or a county not in an MSA or

FMR. There are 20 MSAs and FMRs, and 62 other counties in Illinois.

Eligibility levels for Illinois Solar for All, based on HUD guidelines for every area and adjusted for

family size, are presented in Appendix F. HUD updated their income guidelines in June 2022, and

Illinois Solar for All income guidelines have been updated with the 2022 HUD State Income Limits.

For Fiscal Year 2017, the HUD eligibility income limits for Illinois as a whole are shown in the table

below. For example, a family of four would be considered “low-income” if their household income

were less than $59,300. (Actual eligibility depends on income for an area, rather than for the state as

a whole.) HUD has other programs that use “very low” and “extremely low” income measures, at

50% and 30% of AMI that are provided here for reference.

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Table 8-7: HUD Income Limits

HUD State Income Limits: Illinois FY 2022

Median family income (MFI) = $97,600

Persons in

household

30% of median

(“extremely low

income”)

$19,950

$22,850

$25,700

$28,550

$30,800

$33,100

$35,400

$37,650

50% of median

("very low

income")

$33,330

$38,050

$42,800

$47,550

$51,350

$55,150

$58,950

$62,750

80% of median

("low income")

$53,250

$60,850

$68,500

$76,100

$82,150

$88,250

$94,350

$100,450

It should be noted that other low-income energy programs, such as IHWAP and LIHEAP have

eligibility guidelines that are updated each program year, based on the federal poverty level (not area

income), with statewide values. Eligibility guidelines are set for households with income below 200%

536

20 ILCS 3855/1-56(b).

537

HUD, FY 2017 Income Limits Documentation System at https://www.huduser.gov/portal/datasets/il.html.

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https://www.huduser.gov/portal/datasets/il/il22/State-Incomelimits-Report-FY22.pdf. For metropolitan area and county level

income limits, see: https://www.huduser.gov/portal/datasets/home-datasets/files/HOME_IncomeLmts_State_IL_2022.pdf.

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of the previous year’s federal poverty level, depending on the program. Illinois eligibility guidelines

are set by the Department of Commerce and Economic Opportunity and are shown in Table 8-8.

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Table 8-8: Eligibility Guidelines for LIHEAP and IHWAP in Illinois

2023 Program Year Illinois LIHEAP and IHWAP eligibility

Household Size

30 Day Income

Annual income

(200% of FPL)

$2,265

$27,180

$3,052

$36,620

$3,838

$46,060

$4,625

$55,500

$5,412

$64,940

$6,198

$74,380

$6,985

$83,820

$7,324

$93,260

Although many households who qualify for LIHEAP and IHWAP will meet the 80% AMI eligibility

guidelines of Illinois Solar for All, there are certain household sizes in particular counties where

200% of FPL exceeds the local 80% AMI. The Program Administrator will still accept proof of LIHEAP

or IHWAP approval as documentation of income eligibility, but with additional verification with

DCEO to confirm household income eligibility to reduce inconvenience to the customer or the

Approved Vendor. The tables in Appendix F compare HUD eligibility levels to LIHEAP and IHWAP

income eligibility levels.

Another approach would be to identify low-income customers by geographic area rather than by

individual household income. HUD’s “Qualified Census Tracts” are used to define eligibility for the

Low-Income Housing Tax Credit (LIHTC).

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Qualified Census Tracts must have 50 percent of

households with incomes below 60 percent of the Area Median Gross Income (AMGI) or have a

poverty rate of 25 percent or more. HUD has identified and mapped Qualified Census Tracts (“QCT”)

nationwide. Overall, there are 657 QCTs in metropolitan areas in Illinois and 49 in non-metropolitan

areas (out of 3,123 total census tracts in Illinois). Cook County has the largest portion with 441.

Springfield, which has 15 QCTs, is shown in Figure 8-2 as an example.

The Agency previously used QCTs (along with subscriber affidavits) as a streamlined method for

determining eligibility for low-income community solar subscribers. In its Final Order approving this

2022 Long-Term Plan,

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the Commission directed the Agency to broaden this geographic eligibility

method for low-income community solar to include census tracts where 50% of the households earn

no more than 80% of AMI, to align with the Illinois Solar for All standard. The sections below on

income verification reflect that change.

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Illinois Department of Commerce and Economic Opportunity, “Community Assistance, Energy Efficiency and Infrastructure,”

https://www2.illinois.gov/dceo/CommunityServices/Pages/default.aspx.

540

HUD, “Qualified Census Tracts and Difficult Development Areas.” https://www.huduser.gov/portal/datasets/qct.html.

541

See Docket No. 22-0231, Final Order dated July 14, 2022, at 125.

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Figure 8-2: Springfield Qualified Census Tracts

Source: HUD, https://www.huduser.gov/portal/sadda/sadda_qct.html

8.10.3.2. Determining Income Eligibility

The Agency proposes several approaches to determining income eligibility for the Illinois Solar for

All Program.

For projects that participate in the Low-income Distributed Generation Incentive Program sub-

program, verification of income should be done at the household resident level. This can be done in

several ways.

For buildings with between one and four units, household income can be verified by one of the

following means:

• Review of the most recent federal income tax returns

• Income verification through a third-party income verification system

• Verification of participation in another low-income energy program (such as LIHEAP or state-

funded IHWAP), in HUD’s housing assistance programs where the income eligibility standard

is 80% of AMI or lower for that participant, or in other benefits programs where the income

eligibility limit is 80% of AMI.

Additionally, while the Agency generally expects the Illinois Solar for All Approved Vendor to verify

a potential low-income community solar subscriber’s income through one of the methods described

above, the Agency recognizes that some potential subscribers would prefer to have their income

verified independently of their community solar subscription. In such cases, the potential subscriber

may request income verification directly through the Program Administrator and, if approved, that

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verification would remain valid for 12 months. The Program Administrator would provide the

potential subscriber with a verification letter that could be provided to the Approved Vendor.

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The Agency received comments suggesting streamlining of the income verification process,

particularly for potential participants that demonstrate household-level third-party qualification

such as LIHEAP or IHWAP. Establishing income eligibility is a fundamental part of Illinois Solar for

All. The Agency does acknowledge that improving processes and overall participant experience will

be beneficial, and will work with the Program Administrator and stakeholders to identify ways to

simplify the income verification process.

For two- to four-unit buildings, at least two of the households in the building must qualify. For a

multi-family building (five or more units), either at least 50% of the households must qualify, or the

building owner may demonstrate that the building meets the definition of “affordable housing”

contained in the Illinois Affordable Housing Act, namely:

“Affordable housing” means residential housing that, so long as the same is occupied by

low-income households or very low-income households, requires payment of monthly

housing costs, including utilities other than telephone, of no more than 30% of the

maximum allowable income as stated for such households as defined in this Section.

543

In addition, participation in energy efficiency programs that also have an income eligibility

requirement that is equal to or less than 80% of AMI may also be considered a means of qualifying a

multi-family building.

For residential buildings of two or more units, the building owner will be required to agree to

maintain at least half the units as affordable housing for a period of ten years.

For low-income community solar projects, the Agency recognizes that transaction costs of proving

income eligibility compared to the value of the incentive may be higher than for an installation of a

project on-site, and therefore proposes a streamlined income verification approach:

• A subscriber can be verified as low-income via the same provisions used for the Low-

Income Distributed Generation Incentive sub-program.

• A subscriber can be verified as low-income if that subscriber resides in a census tract where

at least 50% of residents earn no more than 80% of the AMI and provides a signed affidavit

that they meet the income qualification level.

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• For master-metered five-unit and larger residential buildings, either at least 50% of the

tenants must be verified as low-income, or the building must be demonstrated to meet the

definition of “affordable housing” contained in the Illinois Affordable Housing Act.

addition to projects being eligible based on household income, subscriptions for homes or

buildings that qualify for US Department of Housing and Urban Development (“HUD”)

Project-Based Vouchers or Project-Based Rental Assistance (which are programs for housing

units dedicated to low-income tenants) also qualify. The income qualification levels required

542

See Docket No. 19-0995, Final Order dated February 18, 2020 at 108.

543

See 310 ILCS 65/3(e). Note that the definition of low-income household contained in that Act mirrors the definition used for Illinois

Solar for All, and that very low-income households have an income standard that is even lower.

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This eligibility path changed from the Filed Plan. In its Final Order, the Commission required that the Agency immediately expand the

acceptance of signed affidavits for community solar customers to applicants living in census tracts where 50% of residents make no more

than 80% of the area median income. Previously, this option had only been open to those living in HUD Qualified Census Tracts, in which

at least 50% of residents earn less than 60% of AMI. See Docket No. 22-0231, Final Order dated July 14, 2022 at 122.

Illinois Power Agency 2022 Long-Term Plan (Final) August 23, 2022

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for participation in these programs is lower than income requirements for the Illinois Solar

for All Program.

It is the responsibility of the Illinois Solar for All Approved Vendor to track subscribers and document

income eligibility for community solar projects.

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Approved Vendors will be required to report to

the Agency on subscription rates once a year. Illinois Solar for All Approved Vendors will not be

required to verify that existing subscribers continue to meet the low-income eligibility requirements,

but new subscribers over time will be required to meet those requirements.

8.11. Consumer Protections

The 2022 Plan features a strong set of consumer protections as part of both the Adjustable Block

Program and Illinois Solar for All for distributed generation and community solar. The protections

detailed in Chapter 9 apply to both the Illinois Solar for All Program and the Adjustable Block

Program. But several factors lead the Agency to require additional consumer protections that are

unique to the Illinois Solar for All Program. Thus, to be an Illinois Solar for All Approved Vendor for

the program, Approved Vendors must agree to the following additional provisions for low-income

customers.

• In order to “ensure tangible economic benefits flow directly to program participants,” Illinois

Solar for All Approved Vendors must also verify that there are no up-front payments for

residential distributed generation program participants and no up-front subscription fees for

community solar projects (with the exception of nominal fees to purchase shares in

community solar projects organized as cooperative). Illinois Solar for All Approved Vendors

must also provide documentation to both the program participant(s), and to the Program

Administrator explaining how the project or community solar subscription will result in a

cash-flow positive experience for the participant(s) (including an estimate of the monthly

savings) and specifically, ensuring that the savings accruing to each participant, net of any

ongoing participation fees, are at least 50% of the value produced by the solar system through

avoided usage or net metering credits.

546

• For distributed generation projects, a site suitability report is required to ensure that projects

are being installed on properties that will not need substantial structural, roofing or electrical

repairs. If repairs are needed, the Illinois Solar for All Approved Vendor must identify the

plan for the repairs and how they will be paid for, ensuring that such costs do not place an

unsustainable financial burden on the participant. While the site suitability report does not

need to be completed prior to the program participant entering into a contract with the

Illinois Solar for All Approved Vendor (or their sub-contracted installer), if the site suitability

report indicates that the project is not viable, the contract must contain a no-cost cancellation

provision.

• Illinois Solar for All Approved Vendors (or their Designees) are required to provide standard

disclosures of all costs to program participants. Under the Initial and First Revised Plans, the

545

While generally the Agency would expect the Illinois Solar for All Approved Vendor to verify a potential low-income community solar

subscriber’s income through one of the methods described in this Plan, the Agency recognizes that some potential subscribers would prefer

to have their income verified independently of their community solar subscription. In such cases, a potential subscriber may request

income verification directly through the Program Administrator, and if approved, that verification would remain valid for six months. The

Program Administrator would provide the potential subscriber with a verification letter that could be provided to the Approved Vendor.

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See Docket No. 17-0838, Final Order dated April 3, 2018 at 151.

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Agency required that disclosure forms for Low-Income Distributed Generation projects be

presented to customers at least seven calendar days prior to execution of the installation

contract, and that customers also had the right to cancel their installation contract within

seven calendar days following execution of that contract. For this 2022 Plan, the Agency is

eliminating the requirement to present and sign the disclosure seven calendar days prior to

contract execution; instead, program participants may be presented with the disclosure form

and installation contract contemporaneously, and that following the explanation of standard

disclosures to the customer, those documents may also be executed contemporaneously. To

provide an additional consumer protection safeguard, this 2022 Plan, as approved by the

Commission in its Final Order, extends the customer’s right to cancellation from 7 calendar

days to 14 calendar days. For contracts related to subscriptions to Low-Income Community

Solar Project Initiative projects or Low-Income Community Solar Pilot Procurement projects,

customers shall have the right to cancel the subscription agreement within three calendar

days after its initial consummation, and to cancel subscriptions at any time with a 30-day

notice.

• Financing amounts, terms, and conditions must be based on an assessment of the program

participant’s ability to repay the debt, as defined by Regulation Z, which is a federal rule that

implements aspects of the Truth in Lending Act and the Dodd-Frank Act.

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• For low-income customers, loans should not be secured by the program participant’s home

or home equity. While such unsecured loans may entail a higher interest rate, especially for

customers with low credit scores or little credit history, they avoid the risk of liens and

foreclosures for customers who default on their loans.

548

• Contracts for financial products must offer terms that include forbearance. If a program

participant can show good cause in a request for forbearance, financers must offer a)

suspension of total payments for up to three months, b) a suspension of interest payments

for up to six months, or c) a reduction in interest rates for up to twelve months. Missed

revenues may be recovered later in the stage of the contract, but no interest may be applied.

• Contracts may not include prepayment penalties.

• For this 2022 Long-Term Plan, the Agency clarifies that lease or PPA agreements that allow

for ownership of the system to be fully transferred to the participant prior to the 15-year

term of the REC agreement will be allowed only in circumstances where full system

warranties and full coverage of operations and maintenance needs are included at no

additional cost. In these instances, the first-year savings must still meet the minimum

requirement and the lifetime savings will be calculated based on a 25-year life of the system.

For Energy Sovereignty on-site projects intended to be transferred to the customer after 5-7

547

See Consumer Financial Protection Bureau, April 10, 2013. Ability-to-Repay and Qualified Mortgage Rule, Small Entity Compliance Guide,

http://files.consumerfinance.gov/f/201304_cfpb_compliance-guide_atr-qm-rule.pdf. Under the regulation (12 C.F.R. § 1026.43, issued

under authority of 15 U.S.C. § 1639c), creditors generally must consider eight underwriting factors: (1) current or reasonably expected

income or assets; (2) current employment status; (3) the monthly payment on the covered transaction; (4) the monthly payment on any

simultaneous loan; (5) the monthly payment for mortgage-related obligations; (6) current debt obligations, alimony, and child support;

(7) the monthly debt-to-income ratio or residual income; and (8) credit history.

548

For example, the Illinois Energy Efficiency Loan Program offers unsecured loans at moderate interest rates through on-bill financing,

but this is only available for certain energy efficiency measures. See: http://programs.dsireusa.org/system/program/detail/5152.

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years, contract terms may include the following: the timing of the transfer, the amount of

Illinois Solar for All funds held in escrow to pay for the transfer, the purchase price of the

system at the time of expected transfer, and a transfer of warranties to the new owner.

Contract terms must be approved by the Program Administrator at the time of project

application.

For Energy Sovereignty community solar projects where individual panels are owned by an

eligible customer, the contract should include the purchase price of the panels net of Illinois

Solar for All incentives. If ownership is transferred after tax benefits are captured, the

contract should specify where applicable: the timing of the transfer, the price of the system

at the time of transfer, funds held in escrow for the buyer, plans for ongoing monitoring and

maintenance after the transfer of ownership, and other factors described for distributed

generation projects.

• Marketing and contractual materials must be in the language requested by the customer. The

Agency reaffirms its commitment to develop program materials in Spanish and other

languages to better reach underserved communities. Approved Vendors will be expected to

provide the ILSFA program brochure and disclosure in the participant’s preferred language,

if available from the Program Administrator.

• Contracts must allow a grace period of at least seven calendar days after the customer

payment due date before late fees are charged.

• All Illinois Solar for All contracts must include full system warranty, as well as operations and

maintenance guarantees for the duration of the REC Contract or 15 years, at no additional

cost to participants. Updated ILSFA disclosures will include customer instructions for

insuring the system. Further details of minimum standards for scope will be clarified in the

ILSFA Approved Vendor Manual with feedback from stakeholders.

8.12. Environmental Justice Communities

The Act directs the Agency to define and provide special consideration to Environmental Justice

Communities in implementing the Illinois Solar for All Program. The Act sets a goal that at least 25%

of funds for the Low-Income Distributed Generation Incentive, the incentives for non-profit and

public facilities, and Low-Income Community Solar projects sub-programs “be allocated to projects

located in environmental justice communities.”

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(The provision did not apply to the Low-Income

Community Solar Pilot Projects, which was competitively bid.)

Through changes to Illinois law made by Public Act 102-0662, other programs and state agencies

now rely on the definitions of environmental justice communities developed by this methodology for

their determinations of program and funding eligibility. Accordingly, the Agency will be cautious

about any changes to the determination of environmental justice communities that would have

cascading impact on those other provisions.

The following sections include definitions of terms, a methodology for determining which Illinois

communities should be considered Environmental Justice Communities, and how the Agency

determined to implement the relevant provisions of the Act. In developing the Illinois Solar for All

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20 ILCS 3855/1-56(b)(2)(A), (B), (C).

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program participation requirements, the Agency committed to consulting with stakeholders and

relevant state agencies, including the Illinois Commission on Environmental Justice and the Illinois

Environmental Protection Agency (“IEPA”), to establish specific values and designate specific

communities as Environmental Justice Communities; the results of that process are outlined within

this section.

8.12.1. Definitions

Section 1-56(b) of the IPA Act as amended by P.A. 102-0662 states that “the Agency shall define

‘environmental justice community’ based on the methodologies and findings established by the

Agency and the Administrator for the Illinois Solar for All Program in its initial long-term renewable

resources procurement plan and as updated by the Agency and the Administrator for the Illinois

Solar for All Program as part of the long-term renewable resources procurement plan update.” The

term “environmental justice” is not defined in the Act or in other Illinois statutes, but it is helpful to

define “environmental justice” in order to define “environmental justice communities.”

The Environmental Justice Act, the 1997 legislation that created the Illinois Commission on

Environmental Justice, found that:

(i) the principle of environmental justice requires that no segment of the population,

regardless of race, national origin, age, or income, should bear disproportionately high

or adverse effects of environmental pollution;

(ii) certain communities in the State may suffer disproportionately from environmental

hazards related to facilities with permits approved by the State; and

(iii) these environmental hazards can cause long-term health effects.

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The Illinois EPA defines the term "environmental justice " as follows:

"Environmental Justice" is based on the principle that all people should be protected

from environmental pollution and have the right to a clean and healthy environment.

Environmental justice is the protection of the health of the people of Illinois and its

environment, equity in the administration of the State's environmental programs, and

the provision of adequate opportunities for meaningful involvement of all people with

respect to the development, implementation, and enforcement of environmental laws,

regulations, and policies.

551

The Illinois EPA has also defined what it terms “an area of EJ concern” based on demographic factors,

as “a census block group with a low-income and/or minority population greater than twice the

statewide average.” The IEPA “uses a geographic information system (GIS) mapping tool called EJ

Start to determine where areas of EJ concern are within the state. When a permitting action or other

issue arises in an area of EJ concern, the Illinois EPA conducts enhanced public outreach.”

552

Thus,

the Illinois EPA takes a preemptive approach, identifying areas that may be more vulnerable to

environmental hazards and including the community before potential pollution occurs.

550

415 ILCS 155/5.

551

Illinois EPA web site, “Environmental Justice Policy,” https://www2.illinois.gov/epa/topics/environmental-justice/Pages/ej-

policy.aspx.

552

Id.

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The United States Environmental Protection Agency defines an “overburdened community” under

both social and environmental terms as:

Minority, low-income, tribal, or indigenous populations or geographic locations in the

United States that potentially experience disproportionate environmental harms and

risks. This disproportionality can be as a result of greater vulnerability to environmental

hazards, lack of opportunity for public participation, or other factors. Increased

vulnerability may be attributable to an accumulation of negative or lack of positive

environmental, health, economic, or social conditions within these populations or

places. The term describes situations where multiple factors, including both

environmental and socio-economic stressors, may act cumulatively to affect health and

the environment and contribute to persistent environmental health disparities.

553

Both the IEPA and US EPA have developed analytical tools based on their definitions of EJ

communities. The IEPA’s EJ START is a Geographic Information Systems demographic screening tool

developed by IEPA staff that identifies regions with high minority population and/or low-income

population. IEPA also adds a one-mile buffer around each regulated facility as a simplified way to

identify potential local environmental impacts. It draws from the Census Bureau’s American

Community Survey 5-year estimates (2011-2015) and is updated annually.

The US EPA tool is called EJSCREEN.

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It uses standard and nationally-consistent data to identify

communities with greater risk of exposure to pollution based on 11 environmental indicators that

measure potential exposure, hazard/risk and proximity, including traffic proximity, particulate

matter, and proximity to superfund sites. These indicators are combined with demographic data from

the Census Bureau, enabling users to identify areas with minority or low- income populations who

also face potential pollution issues.

While these tools are useful, they do not holistically address all aspects of environmental justice. For

example, EJSCREEN evaluates individual environmental indicators but does not look at cumulative

impacts.

The most rigorous tool for analyzing impacted communities is the California Communities

Environmental Health Screening Tool (“CalEnviroScreen”) from the California Office of

Environmental Health Hazard Assessment (“OEHHA”).

555

CalEnviroScreen compiles data on 12

indicators of pollution burden and 8 population characteristics collected at the Census tract level. It

then weights certain factors to develop a score for each area. High scoring areas are then considered

eligible for a number of state policies, including disposition of some of the revenues from the state

cap-and-trade program created under Assembly Bill 32.

553

US EPA, “EJ 2020 Glossary,” https://www.epa.gov/environmentaljustice/ej-2020-glossary.

554

See: https://ejscreen.epa.gov/.

555

California Office of Environmental Health Hazard Assessment, California Communities Environmental Health Screening Tool

(CalEnviroScreen), https://oehha.ca.gov/calenviroscreen/report/calenviroscreen-version-20.

Illinois Power Agency 2022 Long-Term Plan (Final) August 23, 2022

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Table 8-9: Summary of CalEnviroScreen 3.0 Identification Methodology

Pollution Burden

Population Characteristics

Exposures

Sensitive populations

Ozone Concentrations

PM2.5 Concentrations

Diesel PM Emissions

Drinking Water Contaminants

Pesticide Use

Toxic Releases from Facilities

Traffic Density

Asthma Emergency Department Visits

Low Birth Weight Infants

Cardiovascular disease (emergency

department visits for heart attacks)

Environmental effects

Socio-economic indicators*

Cleanup Sites

Groundwater Threats

Hazardous Waste

Impaired Water Bodies

Solid Waste Sites and Facilities

Educational Attainment

Housing burdened low income

households

Linguistic Isolation

Poverty

Unemployment

Source: OEHHA. * California law prohibits the use of race as a factor in CalEnviroScreen.

The CalEnviroScreen approach is an attractive way to consider defining environmental justice

communities but the Agency notes that the development of it was a multi-year, multi-million dollar

undertaking. Therefore, the Agency will utilize a streamlined approach that takes the concept of

CalEnviroScreen and simplifies it for use in Illinois through using readily available data from the U.S

EPA’s EJSCREEN tool. CalEnviroScreen does not account for race in its calculations, but by using data

from EJSCREEN, the Agency will be able to do so.

The federal government’s U.S. Digital Service, working with the Council on Environmental Quality, is

developing the Climate and Economic Justice Screening Tool (“CEJST”) to guide federal programs

under the Justice40 initiative (Executive Order 14008). The tool expands and improves EJSCREEN,

featuring interactive maps with indicators to assist agencies in defining and identifying

disadvantaged communities. The beta version of the CEJST was launched on February 18, 2022, for

comment, and will be updated in the near future to incorporate public comments. When the final tool

is available, the IPA will review the results and evaluate if it results in any changes to the

consideration of environmental justice communities contained herein.

8.12.2. Approach for Defining Environmental Justice Communities

The Agency determined which areas qualify as Environmental Justice Communities by analyzing data

from Illinois census block groups

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for the following environmental indicators, as described by the

EJSCREEN Tool:

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• National-Scale Air Toxics Assessment (NATA) air toxics cancer risk

• NATA respiratory hazard index

556

There are approximately 10,000 census block groups in the state of Illinois.

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See https://www.epa.gov/ejscreen/overview-environmental-indicators-ejscreen.

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• NATA diesel PM

• Particulate matter

• Ozone

• Traffic proximity and volume

• Lead paint indicator

• Proximity to Risk Management Plan sites

• Proximity to Hazardous Waste Treatment, Storage and Disposal Facilities

• Proximity to National Priorities List sites

• Wastewater Dischargers Indicator

The following demographic indicators are also used by EJSCREEN and were incorporated into the

Agency’s methodology:

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• Percent Low-Income

• Percent Minority

• Less than high school education

• Linguistic isolation

• Individuals under age 5

• Individuals over age 64

The Agency considered including the following seven indicators that use data not contained in

EJSCREEN. These are not available at the same level of detail as the indicators using data from

EJSCREEN (more typically they have data at the zip code or county level) and would need to be

translated to the block group level. Therefore, the Agency determined in the final methodology that

these indicators would be too difficult to incorporate to provide meaningful impact on the evaluation

criteria. Namely, these include the following demographic indicators for Sensitive Population

Characteristics from the Illinois Department of Public Health:

• Asthma Emergency Department Visits

• Low Birth Weight Infants

and the following environmental indicators from the Illinois Environmental Protection Agency:

• Drinking Water Watch

• Site remediation program

• Leaking Underground Storage Tank Incident Tracking

• State Response Action Program

• Solid Waste Facilities

Using the eleven environmental and six demographic factors listed at the top of this section, the

Agency then weighted each factor using an approach adapted from CalEnviroScreen: census block

groups were ranked for each environmental and demographic indicator, a resulting percentile score

determined for each census block group within each indicator, and the percentile scores averaged,

resulting in an environmental score and a demographic score for each census block group. The two

558

See https://www.epa.gov/ejscreen/overview-demographic-indicators-ejscreen.

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averages were then multiplied together to determine a single Environmental Justice score for each

census block group.

Figure 8-3: CalEnviroScreen Formula

Source: OEHHA

Communities with scores in the top 25% of all census block groups statewide are defined as

Environmental Justice Communities for the purpose of the Illinois Solar for All Program. This

definition will be used to target grassroots education funding and incentives for the Low-income

Single-Family and Small Multifamily Solar, the Low-income Large Multifamily Solar, Non-

profits/Public Facilities, and Low-income Community Solar sub-programs.

A community that is not in the top 25% of scores and thus is not initially defined as being an

Environmental Justice Community may request that the Agency consider designating that

community as such. The Agency will consider requests from community-based organizations, local

units of government, or community residents for self-designation as an environmental justice

community based on demonstrated quantitative and qualitative environmental and/or

socioeconomic factors that show a disproportionate burden and were not adequately captured in the

screening defined above. A request for self-designation must be approved through an Environmental

Justice Community Self-Designation Process

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prior to any project application being submitted that

seeks to utilize its location in an approved self-designated Environmental Justice Community as part

of its project selection.

The Agency notes that this approach focuses on analysis of census block group-level data, and that

communities are typically understood by their residents to be defined through geographic, cultural,

and other factors that may, or may not, correspond to census block group boundaries. In addition,

the US EPA cautions that data in the EJSCREEN tool is not always reliable at the block group level,

and recommends that it may be necessary to aggregate up to larger geographic areas in a “buffer

report.”

560

559

The initial Self-Designation Process developed by the Agency and Program Administrator can be found at

https://www.illinoissfa.com/app/uploads/2019/05/042219EJ-Self-Designation-Process_Final.pdf. The Agency reserves the right to

modify this process in the future based on program experience.

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EJSCREEN Technical Documentation, at https://www.epa.gov/ejscreen/technical-documentation-ejscreen.

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The Agency will therefore also consider reasonable adjustments to the borders of environmental

justice communities from what is calculated through the census block group analysis, provided this

does not create an unacceptable analytical burden.

8.12.3. Environmental Justice Community Designations

The Illinois Solar for All Program Administrator undertook the analysis described in Section 8.12.2

in early 2019 prior to the program launch, which included a workshop and an opportunity for written

stakeholder comments. The resulting interactive map of Environmental Justice Communities, as well

as information from that stakeholder process, is available at www.illinoissfa.com/environmental-

justice-communities. The map of environmental justice communities will be updated at least on a

semiannual basis to reflect any additional approved requests for self-designation.

The EJSCREEN data used to determine Illinois Solar for All Program-determined Environmental

Justice Communities will be updated, and the Environmental Justice Community maps refigured,

based on updated data from each Illinois Solar for All program year. Previously designated Self-

Designated Environmental Justice Communities will be maintained through this update. To allow for

project development cycles that may overlap with these changes, for the 2022-2023 program year,

the initial and updated Environmental Justice Community determinations will both be considered as

meeting program Environmental Justice goals and selection points. Following the updates to the

Illinois Solar for All Environmental Justice maps, the Program Administrator and the Agency will

explore the scope of changes between the maps to advise a future proposal of a regular schedule to

update Illinois Solar for All Environmental Justice maps.

8.12.4. Environmental Justice Communities 25% Goal

The Act states that “It is a goal of this program that a minimum of 25% of the incentives for this

program be allocated to projects located within environmental justice communities.”

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For all sub-programs, the Agency will reserve 25% of each sub-program’s annual budget to support

projects in environmental justice communities. If the 25% of funds in each sub-program are fully

allocated to projects in environmental justice communities, then subsequent applicant projects in

environmental justice communities would still be eligible using the general available budgets. The

25% reservation of funds for environmental justice communities will be held open within a sub-

program until filled within a program year, then reset at the beginning of each new program year.

To help ensure that environmental justice communities are made aware of opportunities for

participation in ILSFA, grassroots education funding will be prioritized towards Environmental

Justice Communities to help meet this goal. Up to 60% of the funding (or 3 percentage points of the

5%) will be used for this purpose.

8.13. Program Changes

Several provisions in the Act anticipate the ability to revise program provisions. In addition to the

provision described in Section 1-56(b)(4) of the Act, updated by Public Act 102-0662, that allows

stakeholders to propose additional programs, Section 1-56(b)(2) allows the Agency to reallocate

funds between programs:

561

20 ILCS 3855/1-56(b)(2).

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The allocation of funds among subparagraphs (A), (B), (C) and (E) of this paragraph (2)

may be changed if the Agency, after receiving input through a stakeholder process,

determines incentives in subparagraphs (A), (B), (C), or (E) of this paragraph (2) have

not been adequately subscribed to fully utilize available Illinois Solar for All Program

funds.

562

With this 2022 Plan, the Agency updates the allocation of funds between the sub-programs as

updated by Public Act 102-0662.

For this 2022 Plan the Agency has throughout this Chapter proposed a variety of adjustments to the

program pursuant to the following provision:

Following the Commission's approval of the Illinois Solar for All Program, the Agency or

a party may propose adjustments to the program terms, conditions, and requirements,

including the price offered to new systems, to ensure the long-term viability and success

of the program. The Commission shall review and approve any modifications to the

program through the plan revision process described in Section 16-111.5 of the Public

Utilities Act.

563

Stakeholders have suggested a more collaborative stakeholder feedback process, rather than issue-

or point-in-time specific engagements. The Agency will work with the Program Administrator to

create an ongoing stakeholder engagement process to gather feedback on ongoing program

performance, changes, and progress. These more general progress sessions will be held at least

quarterly. Further details about this ILSFA Stakeholder Advisory Group can be found in Section 8.17.

Further, the Agency and Program Administrator may consider piloting program or process changes

on a limited scale to better understand and measure those changes’ effectiveness before making long

term changes to the Illinois Solar for All Program. For example, a pilot may involve coordination with

third-party energy efficiency program administrator or community action agency to develop a

process that would facilitate connecting participants in energy efficiency programs with Illinois Solar

for All Approved Vendors or provide initial site suitability screening.

8.14. Evaluation

Section 1-56(b)(6) requires that this Plan include an approach for independent evaluation of the

Illinois Solar for All Program:

At least every 2 years, the Agency shall select an independent evaluator to review and

report on the Illinois Solar for All Program and the performance of the third-party

program administrator of the Illinois Solar for All Program. The evaluation shall be

based on objective criteria developed through a public stakeholder process. The process

shall include feedback and participation from Illinois Solar for All Program

stakeholders, including participants and organizations in environmental justice and

historically underserved communities. The report shall include a summary of the

evaluation of the Illinois Solar for All Program based on the stakeholder developed

objective criteria. The report shall include the number of projects installed; the total

installed capacity in kilowatts; the average cost per kilowatt of installed capacity to the

562

20 ILCS 3855/1-56(b)(2).

563

20 ILCS 3855/1-56(b)(4).

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extent reasonably obtainable by the Agency; the number of jobs or job opportunities

created; economic, social, and environmental benefits created; and the total

administrative costs expended by the Agency and program administrator to implement

and evaluate the program.

In January 2019, the Agency held a workshop and took stakeholder feedback to assist in the

development of the scope and process for the evaluation.

564

The Agency then issued a Request for

Qualifications/Request for Proposals to select an independent evaluator to conduct the evaluation.

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This selection process is expressly exempted from the Illinois Procurement Code.

566

On August 7,

2019, the Commission approved the contract for the Agency’s selected evaluator, APPRISE, Inc.

The Act calls for an evaluation “at least every 2 years,” but the Agency notes that Illinois Solar for All

did not launch for project applications until May 2019. The Phase I Evaluation Report, released in

October 2019, focused on the stakeholder outreach process, development of program materials and

guidelines, initial Illinois Solar for All Approved Vendor registration, initial project applications, and

the development of Grassroots Education efforts, and was included in Appendix G of the First Revised

Plan. Four Phase II Evaluation Reports were completed in 2020 and 2021, which detail the first two

years of ILSFA activities through program year 2021-2022 and provide recommendations for

program improvement. The Illinois Solar for All Evaluation Summary Report was also created to

provide a succinct overview of program design, metrics, and recommendations found in the Phase I

and Phase II evaluation reports.

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Recommendations from the Phase II Final Evaluation Report are summarized below. The Phase II

Final Evaluation Report is included as Appendix H to this 2022 Plan. Generally, these

recommendations do not require specific changes to the Plan but rather can be considered and

potentially implemented through ongoing program administration, and the Program Administrator

has or will be implementing many of these recommendations. Where applicable, changes proposed

in this 2022 Plan reflect these recommendations.

Recommendations

• Low-Income Distributed Generation Sub-program Project Barriers: Continue to reduce

barriers to development of DG projects. This may include exploring where program

requirements can be reduced, reducing or removing the waiting period between disclosure

and contract execution, and reducing the batch requirement for the first set of projects. Also

increase outreach to Illinois Solar for All Approved Vendors to encourage them to develop

more standard offers for the list provided to potential participants, and work with the

Chicago Porch and Roof Replacement Program and similar programs to target households

that may have already had roof repair.

• Utility Screening: Future legislation could be considered that specifies how utilities engage

with ILSFA and provides funding to support other aspects of project development.

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See: https://www.illinoissfa.com/announcements/2019/01/written-comments-on-illinois-solar-for-all-third-party-program-

evaluation/ and https://www.illinoissfa.com/announcements/2019/02/public-comments-on-third-party-evaluation/.

565

See: https://ipa.illinois.gov/content/dam/soi/en/web/ipa/documents/ilsfa-evaluator-19-rfp-02-5-10-19.pdf and

https://ipa.illinois.gov/content/dam/soi/en/web/ipa/documents/ilsfa-evaluator-19-rfp-02-5-10-19.pdf

566

20 ILCS 3855/1-56(f).

567

See: https://www.illinoissfa.com/evaluation/.

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• Limit Program Changes: Program design changes should focus on refinements that reduce

barriers to participation in the Low-Income Distributed Generation sub-program. This will

allow the Program Administrator to focus on streamlining project development and

implementation processes.

• ILSFA Website: The ILSFA website design can be improved to make it easier to find

information and understand the program.

• ILSFA Portal: The portal has been adapted as the program has grown, and there are

opportunities to streamline, reduce redundancies and increase user-friendly design

elements.

• Green Bank: Develop plans for how a Green Bank can aid Illinois Solar for All Approved

Vendors in project financing if enabling legislation is enacted.

• Stakeholder Outreach: Implement proactive outreach to stakeholders beyond current email

blasts, and engage community action agencies and other organizations that serve low-income

households.

• DG Screening: Develop and implement a process to work collaboratively with the community

action agencies that administer LIHEAP and IHWAP.

• Part II Process: Reduce challenges with document and photo uploading, job training

document collection, and documentation redundancies.

The Agency plans to begin the process of selecting an Evaluator for the next two-year period starting

in the fall of 2022. The Evaluator selection process will include opportunities for stakeholder input

in the evaluation design. The next phase of evaluation of the Illinois Solar for All Program will

include evaluation of pilot programs proposed in this Chapter.

8.15. Grassroots Education Funding

Section 1-56(b)(3) of the IPA Act as amended by Public Act 102-0662 also requires that the Agency

“direct that up to 5% of the funds available under the Illinois Solar for All Program to community-

based groups and other qualifying organizations to assist in community-driven education efforts

related to the Illinois Solar for All Program, including general energy education, job training program

outreach efforts, and other activities deemed to be qualified by the Agency.”

568

For the initial

program years, the Agency interpreted the “funds available under the [Program]” to be the annual

contribution of approximately $11.7 million from the Renewable Resources Budget under Section 1-

75(c)(1)(O) of the Act, plus $16.5 million allocated annually from the RERF for the three non-

competitive sub-programs, plus $2.5 million allocated annually from the RERF for the Low-Income

Community Solar Pilot Projects.

569

Therefore, the maximum available annual budget for grassroots

education was $1.53 million for these two program years; the Agency awarded $449,464 for

568

20 ILCS 3855/1-56(b)(3).

569

While for three of the sub-programs there are defined program year funding levels available, that concept did not apply cleanly to the

Low-Income Community Solar Pilot Project sub-program. For simplicity, the Agency proposed to allocate the total available funding for

that sub-program ($37.5 million) over 15 years, which is the length of time that projects from the sub-program would be delivering RECs

to the Solar for All Program.

Illinois Power Agency 2022 Long-Term Plan (Final) August 23, 2022

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community grassroots education campaigns in the 2019-2020 program year, $499,094 in the 2020-

2021 program year, and $500,000 in the 2021-2022 program year. With the utility funding available

for Illinois Solar for All increasing to $50 million per year in addition to funding from the Renewable

Energy Resources Fund, funding for grassroots education is potentially very substantial and the

Agency will continue to assess what is an appropriate funding level. With expanded budgets allowed

by CEJA, up to $3.325 million (5% of $66.5 million) would be available to support grassroots

education funding.

For the purposes of grassroots education, community-based organizations must be registered non-

profit entities, excluding trade or political non-profits. It is recognized that the definition of

community-based organizations or non-profit is very broad and may include a variety of organization

types. It is not required that non-profit organizations have federal 501(c)(3) status, and collaborative

or fiscal sponsorship should be encouraged to ensure that very small, hyper-local organizations can

participate. Qualified organizations should work within the communities in which they will be

providing grassroots education. Grassroots educator entities will be chosen through competitive

RFPs issued periodically and selected grassroots educators will be subcontractors of the ILSFA

Program Administrator. Pursuant to the Initial Plan, the first selection of grassroots educators was

made in June 2019.

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As noted in Section 8.12.4, grassroots education funding will be prioritized towards Environmental

Justice Communities to help meet this goal. Up to 60% of the funding (or 3 percentage points of the

5%) will be used for this purpose. Grassroots education topics could include solar basics, program

requirements, consumer protection, program benefits and opportunities, job training opportunities,

environmental justice community issues, or community engagement, among many others. One

objective of the grassroots education strategy will be to ensure that campaigns collectively reach a

diversity of households and communities, topics, and geographies over time.

Public Act 102-0662 updated language directing grassroots education efforts to clarify, “Grassroots

education funding shall not be used to support the marketing by solar project development firms and

organizations, unless such education provides equal opportunities for all applicable firms and

organizations.” Non-profit organizations providing grassroots education to communities must

ensure that outreach and education provided does not serve the interest of any Approved Vendor or

other solar developer above any other. When grassroots education events are open to Illinois Solar

for All Approved Vendors, all Approved Vendors should have an equal opportunity to participate in

a transparent manner. No organization providing grassroots education services should have a

current financial relationship with an Illinois Solar for All Approved Vendor where the grassroots

education organization receives payment for such services, and any past relationships should be

clearly disclosed when submitting proposals. Community-based organizations may work with

Illinois Solar for All Approved Vendors in the capacity of developing a solar project for their own

property. Community-based organizations receiving grassroots education funding are also

permitted to provide referrals to Illinois Solar for All Approved Vendors who request assistance in

identifying either community organizations or property owners that are interested in seeing

community solar projects developed in their communities, provided there are no financial payments

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See: https://www.illinoissfa.com/announcements/2019/06/announcing-grassroots-organizations.

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or other benefits received by the grassroots education funding recipient in exchange for such

referrals.

The Agency will conduct a special request for proposals to contract a community organization with

experience in job placement services to conduct an educational campaign to connect Illinois Solar for

All Approved Vendors with interested trainees. This will supplement (not replace) the job trainee

clearinghouse to be maintained by the Program Administrator discussed in Section 8.6.

Section 1-56(b)(2) directs the Agency to coordinate ILSFA program administration “with similar

initiatives, including … energy efficiency programs, job training programs, and community action

agencies.”

Community action agencies and other entities offer the Illinois Home Weatherization Assistance

Program and other energy efficiency services to low-income households in Illinois. Their work offers

a synergistic opportunity to engage with the same households that are eligible for the Illinois Solar

for All program.

The Agency and the Program Administrator have made progress in coordinating with CAAs and

utility-run energy efficiency programs, and individual Approved Vendors can and have developed

partnerships with specific CAAs.

Public Act 99-0906 instructs the Agency to support “grassroots education efforts related to the

Illinois Solar for All Program.” To date, funded grassroots education campaigns have specifically

focused on community education by local community organizations. The Agency and Program

Administrator have experienced challenges engaging community action agencies and other low-

income energy efficiency service providers that could potentially incorporate a solar assessment

because the Agency does not believe these services can be considered “community education,” and

thus not eligible for grassroots education funding, although such activities could potentially promote

and simplify ILSFA participation. The Agency believes the updated language of 1-56(b)(2) in Public

Act 102-0662, which adds “and other activities deemed to be qualified by the Agency,” expands the

kinds of activities covered by this funding to include non-educational activities, such as costs for low-

income energy efficiency providers to perform preliminary site suitability assessments, and other

activities and services that can be performed by community organizations to drive and facilitate

ILSFA participation. The Agency will explore expanding the types of activities campaigns support by

grassroots education funding, or perform a separate targeted RFP for specific activities to drive ILSFA

participation.

Specific opportunities for this expanded use of grassroots education funding could include finding

ways to coordinate customer enrollment, assist with income verification, and program promotion.

Any new activities supported by grassroots education funding that involve or impact existing state

energy efficiency programs will seek input from the advisory groups, utilities, and stakeholders

associated with those programs.

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At a minimum, the Program Administrator will seek to work with Approved Vendors and CAAs to

develop materials that can be shared with customers to cross-promote the programs.

571

See Docket No. 22-0231, Final Order dated July 14, 2022 at 126.

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Customers who have already received income-qualified energy efficiency or health and safety repairs

can be referred to the ILSFA program, once protocols have been established for sharing customer

information. CAAs could be supported in part for the costs associated with site assessment and

referrals to the ILSFA program. Weatherization and solar marketers could offer combined efficiency

and solar products, or CAAs could register as Approved Vendors for ILSFA.

The Agency will convene parties interested in this collaboration and develop ideas that improve

program delivery.

8.16. Ongoing Research and Education

The Illinois Solar for All Program aims to bring the benefits of solar power to low-income, non-profit,

and public sector customers, environmental justice communities, and Illinois workers.

Illinois Solar for All takes place in the context of a wide range of energy, social, and economic policies

and programs from federal, state, and local governments. Moreover, business and social

entrepreneurs are developing innovative approaches to deployment. Both of these factors lead to a

complicated and shifting landscape for the role of solar energy in addressing social and

environmental inequities.

Many states are exploring policy approaches that combine climate action and equity, with a strong

focus on low-income solar development. The Agency believes that Illinois stakeholders and

practitioners would benefit from ongoing study of opportunities and best practices in other states

that would improve the execution of the Illinois Solar for All Program.

While the Act establishes a number of working groups and advisory councils to provide input on

clean energy programs, no such formal process has been established for Illinois Solar for All. A

number of stakeholders commented on the need for ongoing public input and dialogue around

Illinois Solar for All. The Agency strongly supports such a process, and points to the Community Solar

Energy Sovereignty Grant Program, established in Section 5-60(e) of the Energy Transition Act

enacted through Public Act 102-0662, managed by the DCEO, which may be used “to support the

development of programs and entities to assist in the long-term governance, management, and

maintenance of community solar projects, such as community solar cooperatives." Examples of

eligible tasks include "development of cooperative or community ownership model; and

development of project models that allocate benefits to equity investment eligible communities." The

Agency will explore avenues to collaborate with the DCEO on the execution of such an initiative.

8.17. Illinois Solar for All Advisory Group

The Agency will convene an Illinois Solar for All Advisory Group, to develop and explore ideas and

advise the Agency on the ILSFA program. The group will meet regularly, and representatives will be

invited from the Agency, the Illinois Commerce Commission, the ILSFA Program Administrator,

Approved Vendors, Approved Vendor Aggregators, Equity-Eligible Contractors, industry

participants, grassroots educators or local organizations, the public, and other interested

stakeholders. The Stakeholder Advisory Group may also engage with other agencies coordinating

with ILSFA, such as DCEO and IFA.

The Advisory Group meetings are intended to foster meaningful and informed conversation between

all program stakeholder and agencies, provide education or information regarding participation in

the program, encourage stakeholder and public feedback, and develop and propose incremental

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improvements to the ILSFA program. Ultimate decisions on if or how to implement Advisory Group

recommendations will remain with the Agency.

Meetings will be held online and in-person, if possible, on a regular basis, with a target of once a

month. The Agency will create an email list for interested parties to keep informed of Advisory Group

activities and will post the schedule and materials for meetings on the IPA and Illinois Solar for All

websites.

572

These meetings will be in addition to public stakeholder engagement sessions, which

the Agency holds on an as-needed basis and are open to the public.

572

See Docket No. 22-0231, Final Order dated July 14, 2022 at 128.

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9. Consumer Protection

In prior iterations of the Long-Term Plan, terms, conditions, and requirements for participation in

the Adjustable Block Program and the Illinois Solar for All Program were located in the chapters

outlining program requirements for each. This chapter consolidates discussion of those consumer

protection program requirements applicable across both programs, while expanding the Plan’s

discussion of consumer protection in light of revisions made to Section 1-75(c)(1)(M) of the Act

through P.A. 102-0662.

9.1. Consumer Protection Requirements under Prior Long-Term Plans

The Agency has considered the development of safeguards for consumers a vital component in

ensuring the success of the Adjustable Block Program and Illinois Solar for All. A project that

successfully applies to one of these programs stands to receive a financial benefit from the program

in the form of a REC delivery contract and by extension from the ratepayers who fund it. Requiring

clear and consistent information on the relationships among the end customer, the

installer/developer, and the Approved Vendor is critical to ensuring that the fiscal risks and controls

of these programs are properly and prudently managed.

As explained in prior plans, installation of a photovoltaic system is a significant financial commitment

on behalf of that system’s host (and potential owner). A system that has been sold (or leased) to a

customer using incorrect, inaccurate, or deceptive information could put the financial security of

Illinois residents or businesses at risk and poison the ongoing viability of the Illinois solar market.

While subscribing to a community renewable generation project is not the same as choosing to

purchase, lease, or otherwise host a system located on one’s own property, it bears similarities to

signing up to take supply service from an Alternative Retail Electric Supplier (“ARES”) and includes

a binding contractual commitment. The Agency has observed that the history of questionable

marketing practices of some Alternative Retail Electric Suppliers gives reason to ensure significant

safeguards are in place around the marketing of community renewable generation subscriptions.

573

The troubling practices observed from alternative gas and electric suppliers include: improperly

associating the supplier with the local utility or a government agency or program; implying that a

customer must choose to enroll; inflating the price of green energy offers far beyond the actual

incremental cost of procuring renewable resources; and targeting elderly, non-English speaking, and

low-income customers who may have less access to quality information about energy prices.

The Initial and Revised Plans thus featured consumer protection requirements developed mindful of

the state’s experience with the retail energy supply market and the marketing and sale of energy-

related products. As such, the IPA originally sought to tap into the experience and institutional

knowledge reflected in requirements applicable to alternative retail electric suppliers. While

573

See, e.g., ICC Docket No. 14-0512, Consumer Services Division and Office of Retail Market Development Staff Report to the Commission

dated August 20, 2014, https://www.icc.illinois.gov/downloads/public/edocket/384622.pdf (detailing misleading and noncompliant

marketing tactics employed by one ARES); ICC Docket No. 15-0438, Consumer Services Division and Office of Retail Market Development

Staff Report to the Commission dated July 20, 2015, https://www.icc.illinois.gov/docket/files.aspx?no=15-0438&docId=232481 (detailing

several misleading telephone marketing tactics employed by a different ARES); ICC Docket No. 15-0512, First Notice Order, September 22,

2016, at 55 (expressly relying on information submitted with the ICC Staff Initial Comments dated November 5, 2015

(https://www.icc.illinois.gov/downloads/public/edocket/417068.pdf), which detailed trends in allegations of ARES wrongdoing

including unauthorized switching, misrepresentation of the nature of the transaction, misrepresentation of identity of the ARES,

misrepresentation of price or savings, failure to disclose cancellation fees or right to cancel, and more); ICC Docket No. 17-0273, Order,

August 15, 2017, at 4-5 (denying a certificate of service authority to an ARES that, previously operating in Illinois under a prior corporate

structure, had amassed numerous complaints related to sales and marketing).

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Approved Vendors would not necessarily be Alternative Retail Electric Suppliers, and thus as

Approved Vendors are not governed as a matter of law by the Commission’s Rules applicable to ARES,

the IPA found that the Commission’s Title 83, Part 412 rules provided a workable blueprint for

expectations of Approved Vendors. Therefore, as a condition of ongoing approval, Approved Vendors

are and have been expected to comply with marketing standards generally equivalent to the

Commission-approved rules for marketing practices by alternative retail electric suppliers.

574

The Agency recognizes that it is not a regulatory agency and does not have jurisdiction over all

distributed generation installations or community solar projects across the state. However, the

Agency can and did create common sense provisions to ensure that entities developing projects

seeking to participate in the Adjustable Block and Illinois Solar for All Programs are held to high

standards for consumer protection. As the entities tasked by law with determining participation

eligibility and enforcing program terms, conditions, and requirements on participant firms, those

programs’ respective Program Administrators enforce consumer protection provisions through

disciplinary actions, including issuing formal warnings, placing entities on probation, and when

necessary, suspending non-compliant entities from further participation in these state-administered

incentive programs. As the Program Administrators operate at the direction of and as an extension

of the Agency itself, those Program Administrators share all disciplinary action decisions with the

Agency, and suspension from participation can be appealed to the IPA itself, who provides final

determination on program status.

In approving the Agency’s Initial Plan through Docket No. 17-0838, the Commission recognized the

necessity for consumer protection requirements and authorized the Agency to develop requirements

via program-related forms and documents outside of the Commission’s approval proceeding.

Consistent with the Commission’s Order in that proceeding, the IPA developed initial consumer

protection policies and procedures as terms and conditions of participation in these programs. In

order to ensure transparency in the development of these guidelines, the IPA and its Program

Administrators held a series of stakeholder feedback sessions and solicited written stakeholder

feedback in 2018 before producing program brochures, standard disclosure forms, contract

requirements, requirements for marketing behavior and marketing materials, and the ABP Program

Guidebook and ILSFA Approved Vendor Manual upon opening of the programs.

After deliberation, the Agency decided not to seek Commission approval of those specific documents

through approval of its Revised Plan in Docket 19-0995. The Agency believed then that the ability

to adjust such documents and the requirements embodied within them based on market experience,

without further Commission approval, outweighed the certainty associated with having an

administrative order from a quasi-adjudicatory body affirming the specific contents contained

therein. Instead, the Commission affirmed the following through its Order approving the Revised

Plan:

▪ The Agency maintains flexibility to adjust its program requirements, and the documents and

forms through which they are expressed, without further Commission approval as

warranted;

▪ Any significant adjustments to those requirements should be preceded by a process to

receive stakeholder feedback;

574

See 83 Ill. Adm. Code Part 412 for administrative rules outlining those practices.

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▪ The principle that Approved Vendors may be held accountable for the conduct of their agents,

subcontractors, or designees under the Agency’s marketing guidelines and other program

requirements is a reasonable requirement consistent with a) the Commission’s

determination in Docket No. 17-0838 and b) the Agency’s statutory authority to develop

terms, conditions, and requirements applicable to the programs it implements.

In accordance with the Commission’s Order in Docket 19-0995 approving the Revised Plan, the

Adjustable Block Program Marketing Guidelines and related documents were updated through a

stakeholder process to reflect changes approved by the Commission, including updating the

requirements to align with requirements placed on alternative retail suppliers through the

enactment of Public Act 101-0590.

575

These requirements and related documents underwent minor

modifications once again in October 2021 to reflect changes in program requirements surrounding

the opening of additional capacity for the Adjustable Block Program on December 14, 2021.

576

9.2. Consumer Protection Provisions Arising from Public Act 102-0662

Changes in law under Public Act 102-0662 require the Agency, along with its Program Administrators

for both the Adjustable Block Program and Illinois Solar for All Program, to propose various program

terms, conditions, and requirements applicable to participating entities and project applications. In

large part, the requirements, codified at 20 ILCS 3855/1-75(c)(1)(M), mirror consumer protections

put into place by the Agency and approved by the Commission under the Initial and Revised Plans.

Pursuant to the P.A. 102-0662, the Agency is required to:

i. Establish a registration process for entities seeking to qualify for program-administered

incentive funding, maintain a list of such entities, and revoke an entity’s ability to receive

funding based on the failure to comply with contract terms, the law, or other program

requirements;

ii. Establish program requirements and minimum contract terms to ensure projects are

properly installed and produce their expected amounts of energy;

iii. Direct program participants and their agents to provide standardized disclosure to a

customer prior to the customer’s execution of a contract in order to discourage deceptive

marketing and bad faith business practices;

iv. Establish Consumer Complaint Centers to accept complaints regarding entities that

participate in or otherwise benefit from State-administered incentive funding through

Agency-administered programs, and maintain a public database of complaints;

v. Provide an annual written report to the Commission documenting the frequency and nature

of complaints as well as any enforcement actions taken in response;

vi. Convene regular meetings with representatives of the Office of the Attorney General, the

Commission, consumer protection groups, and other interested stakeholders to share

information regarding consumer protection, project compliance, and complaints received;

and

vii. Refer complaints that implicate the jurisdiction of the Office of the Attorney General, the

Commission, or local, State, or federal law enforcement to the appropriate entity as necessary.

575

See: https://illinoisabp.com/wp-content/uploads/2020/06/ABP-M-GLs-Request-for-Feedback-4.3.20-Updated-Due-Date.pdf.

576

https://illinoisabp.com/wp-content/uploads/2021/10/DG-Marketing-Guidelines-With-CEJA-Update-10.19.21-Redline.pdf

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As revisions to Section 1-75(c)(1)(M) now expressly state that the IPA “shall propose the Adjustable

Block program terms, conditions, and requirements . . . through the development, review, and

approval of the Agency's long-term renewable resources procurement plan,” the Agency understands

this new language as a directive from the General Assembly to include these requirements within the

Long-Term Plan, subject to approval from the Commission, where practicable to do so.

577

As noted in Section 9.1, the Agency lacks plenary regulatory authority over developers of distributed

generation or community solar projects. However, the changes in law to Section 1-75(c)(1)(M)

pursuant to the enactment of Public Act 102-0662 reinforce the IPA’s understanding that consumer

protections are a vital part of its programs through new express statutory requirements

necessitating that the Agency develop “terms, conditions and requirements for program

participation” that discourage deceptive marketing practices and bad faith business practices. A

description of the Agency’s requirements for both programs and proposed changes thereto are

outlined below; existing and proposed new consumer protection program materials are contained

within Appendix I to this Plan. Consistent with past practice, the Agency sought the approval of the

underlying requirements while retaining the flexibility to modify these materials as needed. Material

or significant modifications to these requirements between approval of this and future iterations of

the Long-Term Plan would be conducted through a stakeholder feedback process (except in the case

of emergency changes, such as the type necessitated by the COVID-19 global health pandemic). The

Commission approved this approach in its Final Order in ICC Docket No. 22-0231. The Commission

affirmed “the IPA’s ability to make modifications” between Plan proceedings and rejected the

argument that “every modification, no matter how minor, must be vetted through the stakeholder

process.”

578

Appendix I-1 to this Plan includes the Consumer Protection Handbook and ABP and ILSFA Contract

Requirements, which have been updated from the versions filed on March 21, 2022 to reflect the

Final Order in Docket No. 22-0231. Consistent with this Plan and past approved practice, Approved

Vendors and Designees are given 45 days of lead time to become fully compliant with new

requirements in these documents. Compliance is therefore required by August 28, 2022, 45 days

after the Commission’s July 14, 2022 Final Order. Appendix I-2 to this Plan includes the Disclosure

Forms, which have not yet gone into effect. The Agency intends to hold a stakeholder feedback

process to further update these forms, and expects to launch the final updated Disclosure Forms

through the online Program portals for the June 1, 2023 start of the next Program years.

9.3. Registration for Program Participants

The Agency is required to establish a registration process for entities that wish to qualify for

program-administered incentive funding, establish baseline qualifications for approval of these

entities, and maintain a list on each program’s website. Additionally, the Agency may revoke the

ability for these registered entities to receive program-administered incentive funding upon a

577

The Agency does not interpret this provision of the IPA Act to allow it to promulgate administrative rules related to terms and conditions

of program participation. While the Administrative Procedure Act applies to all its administrative rules and procedures (20 ILCS 3855/1-

30.1), the Agency “shall not adopt any rules that infringe upon the authority granted to the Commission” under Section 1-35 of the IPA Act.

As the Commission has the authority to approve this Long-Term Plan under Section 1-75(c)(1)(A) of the IPA Act and Section 16-111.5(b)(5)

of the PUA, the Agency cannot adopt any administrative rules regarding the terms, conditions, and requirements for participation in the

Adjustable Block and Illinois Solar for All Programs under Section 1-75(c)(1)(M) of the IPA Act – or, indeed, for any other requirement

related to the programs. The promulgation of such administrative rules would plainly infringe upon the authority granted to the

Commission through its role reviewing and approving the Long-Term Renewable Resources Procurement Plan.

578

Docket No. 22-0231, Final Order dated July 14, 2022 at 137.

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determination that the entity failed to comply with program requirements or the law. While these

statutory requirements are newly-enacted pursuant to P.A. 102-0662, those provisions hew closely

to the requirements already in place under both programs, as detailed below.

9.3.1. Registration Requirements

Registration requirements for Approved Vendors and Designees under the Adjustable Block Program

are laid out in Sections 7.7 and 7.8 of this Plan, respectively, and further detail on those processes is

contained within the Program Guidebook. Approved Vendors seeking to participate in the Illinois

Solar for All Program must first satisfy the requirement of being an Approved Vendor in good

standing with the Adjustable Block Program. Registration requirements for Approved Vendors

under the Illinois Solar for All Program are laid out in Section 8.9 of this Plan, and further detail on

the Approved Vendor application process and Designee registration process is contained within the

program’s Approved Vendor Manual.

The Agency experienced an increased number of complaints within the Adjustable Block Program in

2021, predominately surrounding actions of Designees rather than Approved Vendors.

Investigations into these complaints have shown that more often than not, Approved Vendors are

unaware of their Designees’ violative conduct. The Agency previously sought stakeholder feedback

on whether Designees in the Adjustable Block Program should be subject to an application process

similar to Approved Vendors (as opposed to the current process, where Designees simply register

with the program rather than applying to the program seeking the ability to participate as an

Approved Vendor does). The Agency received feedback indicating that this proposal was not

supported, as the process would be burdensome to Designees and may create barriers to program

participation for new and emerging businesses.

Instead, the Agency will require that Approved Vendors that utilize Designees develop plans and

processes for the vetting, management, and training of their Designees. As the Approved Vendor is

ultimately responsible for the actions of its Designees, the Agency believes that this will ensure that

both Approved Vendors and Designees are well-informed of the requirements of the Consumer

Protection Handbook (outlined in Section 9.4.1) and other relevant program documents, and that

this in turn may help reduce the volume and type of consumer complaints, ultimately leading to

greater success both in individual projects and the programs overall. Approved Vendors will be

required to submit these plans and process to the Agency and/or Program Administrators upon

request and may be subject to disciplinary action for the failure to develop and implement internal

policies and procedures for the management of Designees.

579

The Agency will also require that Designees go through an annual process to renew their registration,

similar to the current renewal process for Approved Vendors. As part of this process, Designees will

submit their training materials and certifications showing that their agents have been trained in

accordance with program requirements.

9.3.2. Listing of Approved Entities

Both the Adjustable Block Program and Illinois Solar for All Program provide lists of Approved

Vendors and Designees on each program’s website. For the Adjustable Block Program, this

579

The Agency notes that it intends to develop additional details regarding the requirements for Designee management plans through a

stakeholder process and incorporate these requirements into the next version of the Consumer Protection Handbook.

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information is published both on the consumer-facing branded website, Illinois Shines, and the

website designed for participating entities. Both of these websites also provide information

regarding whether the entity has been disciplined by the Program Administrator for violations of

program requirements. The Illinois Solar for All website likewise provides a listing of Approved

Vendors and registered Designees on its website; however, no disciplinary actions have been taken

against Approved Vendors or Designees in that program to date.

580

For more information on the

public database of disciplinary actions and customer complaints, see Section 9.6 of this Plan.

9.3.3. Disciplinary Determinations

The Adjustable Block Program and the Illinois Solar for All Program are ultimately state-

administered incentive programs leveraging state- or utility-collected funds to provide additional

incentives for photovoltaic project development. These programs do not constitute the Illinois solar

market generally; an Approved Vendor, agent, or Designee could simply choose to operate outside of

the Agency’s consumer protection requirements by not benefitting from incentive funding.

Consequently, the Agency’s disciplinary determinations are simply determining ongoing eligibility

for state-administered incentives. No general conduct is being restricted through the suspension or

revocation of Approved Vendor status; all that is being restricted is an Approved Vendor’s eligibility

for incentive funding through the Agency’s incentive programs.

Changes in law through Public Act 102-0662 support the Agency’s prior position on disciplinary

determinations for violations of program requirements. Section 1-75(c)(1)(M)(i) now provides that

the Agency may “revoke a vendor’s ability to receive program-administered incentive funding status

upon a determination that the vendor failed to comply with contract terms, the law, or other program

requirements.” The Agency believes that revocation of the ability to receive incentive funding may

involve Approved Vendors as direct recipients of incentive funding as well as Designees as indirect

recipients or beneficiaries of that funding. Additionally, the Agency believes that a reasonable

interpretation of the changes in law would include both a temporary revocation (i.e., suspension) and

permanent revocation (i.e., termination of program registration) of the ability to receive program-

administered incentive funding.

The Agency appreciates that certain procedural safeguards should accompany its disciplinary

determinations. Through its Revised Plan, the Agency proposed (and the Commission approved)

procedural requirements applicable to such determinations. Specifically, mirroring and expanding

on the process found in the Adjustable Block Program Guidebook, the Agency’s Revised Long-Term

Plan provided that Approved Vendors, Designees, agents, or other third parties potentially subject to

program discipline for a violation of program requirements generally be afforded the following:

▪ A 45 calendar day lead time will be provided to Approved Vendors and Designees in order to

prepare for and implement general changes to consumer protection requirements. Unless

otherwise specified, the lead time granted will not prohibit Approved Vendors and Designees

from taking earlier steps towards compliance. In situations where the Agency determines

that emergency adoption of a new or modified consumer protection is necessary, no lead time

580

The ILSFA Program Administrator has only sent one suspension letter to date, and it was to an entity that was not registered as an ILSFA

Approved Vendor or Designee. On August 3, 2022, the ILSFA Program Administrator suspended an entity that had misrepresented the

availability of ILSFA incentives to a customer and completed the project in a manner that made it ineligible for ILSFA.

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will apply; however, the Agency commits to enforce any such requirements with an eye

toward the practical challenges inherent in immediate implementation.

581

▪ In the event that the Program Administrator believes an Approved Vendor, Designee, or other

entity participating in its programs is not acting, or has not acted, in compliance with program

requirements, the appropriate Program Administrator will notify the participating entity

(and its Approved Vendor, in the case of an agent or Designee) through an e-mail that:

o Outlines the problematic behavior;

o Explains how the behavior is non-compliant with program requirements;

o Requests more information about the issue; and

o Provides information on any penalties that might result from the behavior.

582

▪ With the limited exception of emergency situations requiring immediate action (as

determined at the discretion of the IPA), no disciplinary determination (such as the

suspension or revocation of the ability to participate in the Agency’s programs) will be made

by the appropriate Program Administrator without the allegedly offending party having the

opportunity to offer a written or oral explanation of the problematic behavior for review and

analysis by the Program Administrator.

▪ All disciplinary determinations are made by the Program Administrator in consultation with

the Agency and will be communicated through a written explanation of the determination

with at least the following:

o A brief explanation of the infractions for which the Approved Vendor and/or

Designee is being disciplined;

o A timeline of communications between the offending entity and the Program

Administrator;

o Specific reference to which specific program requirement(s) the offending entity

violated;

o In the case of a warning, an explanation of the concerning behavior that, if continued,

may lead to a suspension from the program and/or other conditions that the entity

may be required to satisfy to ensure compliance with Program requirements;

o In the case of a probation, an explanation of the probation terms, including which

program requirement(s) must be explicitly followed during the probation period, the

penalty for failure to strictly comply during that period, and other conditions that the

entity may be required to satisfy prior to the probation being lifted;

o In the case of a suspension, an explanation of the suspension terms, including what

specific conduct is no longer permitted in connection with the Program through the

length of the suspension and other conditions that the entity may be required to

satisfy prior to resuming participation in the program; and

o An explanation for how to appeal the Program Administrator’s determination that a

suspension is warranted to the Agency and the deadline for submission of the appeal.

Unless otherwise indicated, appeals must be submitted to the IPA within two weeks

of the suspension determination, but that deadline may be extended by the IPA upon

request by the disciplined entity for good cause.

581

See Docket No. 19-0995, Final Order dated February 18, 2020 at 56, 62. For an example of emergency adoption of a consumer protection,

see: http://illinoisabp.com/2020/03/20/ipa-covid-19-announcement/.

582

The Commission Order in the Long-Term Plan proceeding stated that this notice should include information on possible penalties. See

Docket No. 22-0231, Final Order dated July 14, 2022 at 139.

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▪ The IPA will endeavor to address any appeals of disciplinary determinations within two

weeks of receiving an appeal (although the need to receive additional documents or

information may extend that timeline). The Consumer Protection Handbook clarifies that an

appealing Approved Vendor or Designee may submit a request to the Agency for a stay of any

disciplinary action pending a resolution of its appeal. The Agency may grant or deny this

request and will consider, among other factors, the likelihood of customer harm from such a

stay, whether the conduct that resulted in the suspension is ongoing, and the likelihood that

the appealing entity may prevail. As part of its appeal, an Approved Vendor may also suggest

alternative resolutions or means to address violations (other than the disciplinary action that

is being appealed).

▪ Any appeal determination made by the IPA will include, at minimum, a clear statement of the

Agency’s decision, the consequences of that decision, and a supporting explanation as to why

that decision was made.

The Agency plans to develop additional guidelines to ensure that, as the Programs continue to expand

and address a growing number of complaints, disciplinary responses continue to be carried out in a

fair and consistent manner. Using a transparent stakeholder feedback process, the Agency plans to

develop a matrix

583

laying out the types of consumer protection issues and program violations that

have arisen or may arise and progressive disciplinary responses, including the process provided to

the alleged offender and whether an appeal is available.

584

The Agency does not believe that the authority to “revoke a vendor’s ability to receive program-

administered funding status” is the same as authority to revoke a vendor’s ability to receive program-

administered funding—such as through the suspension of REC delivery contract payments—which

the counterparty utility is contractually obligated to provide for REC deliveries, unless that

consequence follows as a violation of certain REC delivery contract terms.

9.4. Program Requirements and Contract Requirements

As discussed in Section 9.1, pursuant to the Commission’s Order approving the Initial Plan in Docket

No. 17-0838, the Agency and its Program Administrators developed program requirements,

including marketing requirements, standard disclosure forms, contract requirements, and program

brochures. The Agency is now required under Section 1-75(c)(1)(M)(ii) to establish program

requirements and minimum contract terms “to ensure projects are properly installed and produce

their expected amounts of energy.”

While the Agency sought approval of program requirements in the past through the Long-Term Plan,

the actual content has been developed outside of the Plan approval process. The Agency continues

to believe that the ability to adjust consumer protection program requirements, including marketing

requirements and contract requirements, based upon observations of the market and complaints

regarding customer experiences is necessary to provide adequate consumer protections that can

readily adapt to changes in the marketplace or other conditions. For example, in March 2020, the

583

New Jersey’s Clean Energy Program uses a similar approach to address issues with contractors violating program requirements. See

Order at p.7, In the Matter of the Clean Energy Programs and Budget for Fiscal Year 2017: Contractor Remediation Procedures, N.J. Bd of Pub.

Util. Docket No. QO16040353 (Jan. 25, 2017), available at https://www.state.nj.us/bpu/pdf/boardorders/2017/20170125/1-25-17-

8C.pdf.

584

The Agency initially expected that this stakeholder feedback process would commence in September 2022; the Agency now plans to

begin stakeholder discussions on this topic in the October or November meetings of the Consumer Protection Working Group.

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Agency issued emergency requirements related to in-person marketing during the onset of the

COVID-19 global health pandemic.

585

These emergency provisions were modified as the pandemic

progressed through 2020, 2021, and into 2022.

Documents outlining marketing requirements

586

and other requirements have now been included

with this Plan as directed by Section 1-75(c)(1)(M). The IPA once again requested that the

Commission affirm through approval of this Plan that the Agency maintains the flexibility to adjust

the Adjustable Block Program and Illinois Solar for All consumer protection program requirements

(including related documents and forms) between various iterations of the Long-Term Plan without

further Commission approval. As with the updates to the consumer protection requirements that

arose from the Commission’s approval of the Revised Long-Term Plan in Docket No. 19-0995, the IPA

commits to conducting a stakeholder feedback process prior to implementing significant

adjustments to those requirements and related documents between plan proceedings. The

Commission approved this approach in the Final Order in Docket No. 22-0231.

587

The

commencement of any such revision process will be announced on the respective program website

and communicated to Approved Vendors, registered Designees, and other interested stakeholders.

Following a significant, non-emergency change in program requirements adopted through a

stakeholder process, program participants will have 45 calendar days to comply with the updated

provisions.

9.4.1. Consumer Protection Handbook

Appended to this 2022 Long-Term Plan in Appendix I-1, the Agency provides a new document, the

Consumer Protection Handbook, which updates and consolidates the ABP Community Solar

Marketing Guidelines and Distributed Generation Marketing Guidelines, as well as the ILSFA Low-

Income Community Solar Consumer Protection Requirements and the Low-Income Distributed

Generation Consumer Protection Requirements. Approved Vendors and Designees in both programs

are required to adhere to the Consumer Protection Handbook (“CP Handbook”).

There was considerable overlap in the requirements in each of the documents previously in use, but

also some important differences, requiring Approved Vendors and Designees that offered multiple

types of projects to read each separate applicable document in full and keep track of differences

between them. The Agency believes that a consolidated CP Handbook that highlights differences

between ABP and ILSFA, and between community solar and distributed generation projects, will be

more useful to Approved Vendors and Designees, especially those who offer multiple types of

projects or subscriptions. The Agency also believes a consolidated handbook is consistent with the

legislative directive to implement ILSFA “in a manner that seeks to . . . maximize efficiencies and

synergies available through coordination with similar initiatives, including the Adjustable Block

program.” 20 ILCS 3855/1-56(b)(2).

The CP Handbook reflects significant formatting changes, organizational updates, and clarifications,

but retains most of the same substantive requirements. For example, to reduce redundancy, unlike

the ABP DG and Community Solar Marketing Guidelines, the document is not separated into

585

https://illinoisabp.com/covid-19-related-marketing-guidelines-and-updates/

586

The new Consumer Protection Handbook, which includes marketing requirements for the Adjustable Block Program and the Illinois

Solar for All Program, is contained in Appendix I-1.

587

See Docket No. 22-0231, Final Order dated July 14, 2022 at 137.

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marketing “materials” and marketing “activities.” The final CP Handbook, modified consistent with

the Commission’s Final Order in Docket No. 22-0231, is attached to this Plan in Appendix I-1. While

the creation of a red-lined version of the CP Handbook was impractical due to the nature and extent

of the changes, the Agency posted a copy of the CP Handbook to its website which includes comments

in the margins of the CP Handbook flagging major changes in substantive requirements between the

previous documents (ABP Community Solar and Distributed Generation Marketing Guidelines, and

ILSFA Low-Income Community Solar and Distributed Generation Consumer Protection

Requirements) and the initial draft CP Handbook filed on March 21, 2022. Approved Vendors and

Designees should not rely exclusively on these comments and should review the new document in

full.

The CP Handbook includes several new requirements, clarified requirements, and provisions that

explicitly lay out existing requirements, including but not limited to:

• Explanations of what would make an act or practice unfair or abusive

• A requirement that Approved Vendors and Designees be responsive to customer questions

and concerns and respond as promptly as possible, but no later than within seven business

days

• Requirements regarding compliance with contractual obligations, conducting business in a

professional manner, and providing services in a workmanlike manner

• Requirements regarding cooperation with investigations and truthfulness to the Program

Administrator and Agency

• Required disclosures for all marketing channels

• Required disclosures and record retention requirements for telemarketing

• Requirement that the relevant utility account holder must be the signatory on the Disclosure

Form (or, if the if the account holder is a company or organization, an individual authorized

to sign on behalf of the account holder)

• Requirements regarding the use of third-party commercially available e-signature platforms

• Requirements regarding how Disclosure Forms should be completed

The Agency has seen a rise in the number of complaints from customers regarding additional or

increased payments that are scheduled to begin before the customer receives an anticipated pass-

through of the state-administered incentives under the REC delivery contract. The CP Handbook

includes a new requirement that to address this issue. For DG contracts where the Approved Vendor

will make a direct payment or payments to the customer to pass through some or all of the REC

incentive payment, the CP Handbook requires the Approved Vendor to (1) invoice for the incentive

payment in a timely fashion, (2) pay the incentive to the customer after receipt in a timely fashion,

and (3) not use the customer’s share of the incentive payment to meet other financial obligations of

the Approved Vendor.

Chapter I of the CP Handbook sets out requirements for conducting business in a fair, honest, and

legal manner, including requirements regarding statements about RECs and the nature of energy

received, statements about customer savings and the nature of offers, representations about

marketers’ identity and affiliates, and use of testimonials. Chapter II provides requirements that

apply regardless of the marketing channel.

Chapter III then sets out additional requirements that apply to specific marketing channels, such as

in-person sales or telemarketing. Chapter IV explains requirements for marketing to non-English

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speakers. Chapter V discusses Disclosure Forms and the process for executing customer contracts.

Approved Vendors must provide each customer with a completed Disclosure Form prior to the

customer’s execution of the customer contract. Each Disclosure Form will have the relevant

Informational Brochure attached as the first two pages. The brochures are available in either print

or electronic form and have been prepared by the Program Administrator, approved by the Agency,

and may not be modified by the Approved Vendor or Designee. The brochure informs consumers of

their rights, procedures for filing complaints, and point to more information on the Program website.

The Agency has prepared the brochures in English and Spanish and will produce versions in

additional language should the need arise. The Agency is also updating the Illinois Shines Timeline,

which is required to be provided to ABP DG customers who are purchasing a system. The revised

document is titled “Going Solar: Your Guide to Illinois Shines,” and is reworded and redesigned, while

providing substantively the same information as the original timeline. One change in content is that

the Going Solar flyer includes a link to the new project look-up tool, which allows customers to check

the status of their DG project.

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Chapter VI sets out substantive requirements for offers. Chapter VII explains requirements for sales

agent training, and Chapter VIII discusses requirements related to bundled Alternative Retail Electric

Suppliers offers. Chapter IX sets out recordkeeping requirements. Chapter X discusses complaint and

disciplinary processes.

Chapter XI sets out additional requirements that apply to ILSFA. The applicable requirements for the

Illinois Solar for All Program include additional protections beyond those of the Adjustable Block

Program, as to account for the additional risk of deceptive marketing practices and behaviors

targeted towards low-income customers.

Pursuant to the Commission’s Final Order in Docket No. 22-0231, the CP Handbook has been updated

to clarify requirements around the use of the utility name in marketing,

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as well as to include the

requirement that notices of potential violation to Approved Vendors and Designees must include

information regarding possible penalties.

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This updated version of the CP Handbook is attached in

Appendix I-1 and has been published on both Program websites.

9.4.2. ABP Program Requirements

In addition to being outlined in this Plan, program requirements for participants in the Adjustable

Block Program have also in the past been detailed in the Program Guidebook, Contract Requirements,

and Guidelines

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for Marketing Materials and Marketing Behavior (“Marketing Guidelines”), of

which there were separate versions for marketing of community solar subscriptions and distributed

generation installations. As explained above in Section 9.4.1, the Marketing Guidelines are among

several documents now consolidated into the new Consumer Protection Handbook. Approved

Vendors and Designees alike are required to be familiar with and comply with all program

requirements in order to remain in good standing with the program.

While Chapter 7 of this Plan outlines the primary goals and requirements for the Adjustable Block

Program, detail regarding the implementation of those requirements is explained in the ABP Program

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Find the project look-up tool for Distributed Generation projects here: https://illinoisshines.com/project-status/

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See Docket No. 22-0231, Final Order dated July 14, 2022 at 143.

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See id. at 139.

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While titled as “Guidelines,” this document constitutes firm requirements for continued program participation.

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Guidebook. Developed by the Agency in conjunction with the Program Administrator, the Program

Guidebook provides necessary detail on program requirements across all program categories and

processes. As such, some items related to the consumer protection provisions in Public Act 102-0662

(for example, the processes for Approved Vendor applications and Designee registration or project

inspections) are outlined in the Program Guidebook. The Agency, along with the Program

Administrator, work to update the Program Guidebook on a regular basis to ensure that

requirements are in step with the program as it develops.

In addition to the Program Guidebook, there are several other documents that either set forth

program requirements or are essential for compliance with those requirements, including:

• Distributed Generation Standard Disclosure Form: available in English, with separate

versions available dependent upon whether the system is leased, purchased, or financed

through a PPA. Instead of a separate Disclosure Form for DG project over 25 kW in size, the

streamlined, uniform form for each financing type—once finalized—should be used

regardless of project size. The new DG forms for lease, purchase, and PPA will be used for all

ABP DG projects, regardless of size. The Agency plans to release Spanish versions of the

Distributed Generation Disclosure Forms as soon as practicable.

• Community Solar Standard Disclosure Form: available in both English and Spanish.

• Informational Brochures:

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available in both English and Spanish, with separate brochures

providing detail on distributed generation and community solar technologies and offers.

• Consumer Protection Handbook: updates and consolidates the previously used Guidelines for

Marketing Materials and Marketing Behavior.

• Contract Requirements: different contract requirements exist for installation of a distributed

generation system and a community solar subscription.

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These supporting documents as listed above and attached hereto in Appendix I work in concert with

the Program Guidebook to ensure that program participants (Approved Vendors and Designees) are

fully informed on program requirements. Approved Vendors must document to the IPA through the

application process that the minimum contract requirements for distributed generation systems

were met (outlined below in Section 9.4.2.1), that the customer received the Informational Brochure,

and that the customer received and executed a standard (i.e., unmodified) Disclosure Form prior to

the execution of the contract with the program participant (as explained in more detail in Section

9.5).

It is the Agency’s hope that through development of these requirements, customers who encounter

the Programs are educated about the benefits and costs of photovoltaic installation and/or

community solar subscriptions. The Agency firmly believes that a well-informed Approved

Vendor/Designee can ensure that customers have a positive experience and understand both the

program and their offer, so goes to great lengths to ensure Approved Vendors/Designees are well

informed, while simultaneously maintaining a focus on consumer education and protection.

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See: https://illinoisabp.com/brochures/

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Updated versions of the Contract Requirements, which reflect the Final Order in Docket No. 22-0231, are attached in Appendix I-1.

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9.4.2.1. ABP DG Contract Requirements

The Initial Long-Term Plan stated that, for distributed generation installations, the Illinois Power

Agency and its Program Administrator would develop “a list of contract requirements” to be provided

to Approved Vendors for the system purchase contract, lease, or power purchase agreement (“PPA”)

between the Approved Vendor (or its agent) and the customer. After approval of the Initial Plan

through Docket No. 17-0838, the Agency (through a stakeholder comment process) developed

minimum contract requirements applicable to photovoltaic system sales, photovoltaic system

installations, and community solar subscriptions. These contract requirements were developed and

released for program participants on January 23, 2019, and have applied to transactions supported

by the Program since the onset of the Adjustable Block Program.

Public Act 102-0662’s changes to 1-75(c)(1)(M) reinforce the Agency’s authority for developing

these requirements as a condition of participation in its incentive programs. Specific minimum

contract requirements are outlined in the subsections below. To date, these requirements have

generally taken the approach of a minimum set of items which need to be expressly addressed

through the contract, rather than minimum baseline terms intended to benefit customers (such as

customer savings requirements, O&M terms, PV system capacity factor/efficiency, etc.).

The minimum requirements for installation contracts utilized for projects that participate the

Adjustable Block Program are as follows:

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1. Common Contract Requirements for All Business Models

• Right of rescission within three or more calendar days (only for systems <=25kW)

• System design specification:

i. Site plan or equivalent drawing (this may be incorporated by reference, in

which case the site plan or equivalent drawing must be completed and

provided to the customer within 30 days of the contract execution and must

be substantially consistent with the specifications contained in the contract

and Disclosure Form)

ii. Size of system

iii. Estimated first year production and annual degradation

• If performance guarantee is provided:

i. Host or owner’s remedy in case of underperformance

ii. Host or owner’s procedure to lodge a claim under the performance guarantee

• Change in pricing or other terms, if any, in the event of non-selection for an Adjustable

Block Program REC contract. As an example, a condition precedent clause would

satisfy this requirement.

• Responsibility for interconnection application

• If warranty is provided:

i. Term of warranty

ii. Defects covered (e.g., faulty installation, malfunctioning components beyond

manufacturer’s warranty, roof damage)

iii. Financial limits on warranty

iv. Warranty provider

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See: https://illinoisabp.com/wp-content/uploads/2020/05/dg-contract-requirements-2019_01_23.pdf

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v. Host or owner’s procedure to lodge a claim under warranty

• Allocation of maintenance obligations between host or owner & installer

• Allocation of responsibility for entering meter data (this provision could be in a

separate contract)

• All possible fees (other than those mentioned in #2, #3, and #4 below)

• Events of default

i. Remedies of both host or owner & installer in case of default

• Dispute resolution procedures

• Governing law

2. Contract Requirements Specific to Purchase Transactions

• Total price:

i. Down payment, if any

ii. Schedule of subsequent payments

• Type of panels

• When title transfers to owner

• Provisions for owner’s transfer of RECs to Approved Vendor (this provision could be

in a separate contract)

• Owner’s rights and obligations upon selling the property

• When mechanic’s lien waiver(s) will be provided

3. Contract Requirements Specific to PPA Transactions

• Frequency of periodic (e.g., monthly) payments

• Method of invoicing and payment

• Pricing terms (including escalation)

• Date of first payment

• Term of PPA arrangement

• Early termination fee, if any

• Whether system removal is (i) mandatory or (ii) at the host’s election or (iii) not

possible upon contract termination

o System removal fee, if any

• Whether PPA offtaker has right to purchase the system

o before end of lease term; or

o upon end of lease term

o In either case, economic terms for purchase

• PPA term renewal: automatic? At host’s option? Not at all? What are the economic

terms?

• System owner’s right to file UCC-1 statement

• Allocation of responsibility to maintain insurance on system, and the required

insurance terms

• Allocation of risk of loss in case of damage to system

• Host’s rights and obligations upon selling the property

i. Requirements for transferring the PPA agreement to the new property owner

4. Contract Requirements Specific to Lease Transactions

• Initial payment

• Frequency of periodic (e.g., monthly) payments

• Method of invoicing and payment

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• Pricing over time (including escalations)

• Date of first payment

• Term of lease

• Early termination fee, if any

• Type of panels

• Whether system removal is (i) mandatory or (ii) at the host’s election or (iii) not

possible upon contract termination

i. System removal fee, if any

• Whether lessee has right to purchase the system

i. before end of lease term; or

ii. upon end of lease term

iii. In either case, economic terms for purchase

• Lease term renewal: automatic? At lessee’s option? Not at all? What are the economic

terms?

• Lessor’s right to file UCC-1 statement

• Allocation of responsibility to maintain insurance on system, and the required

insurance terms

• Allocation of risk of loss in case of damage to system

• Lessee’s rights and obligations upon selling the property

i. Requirements for transferring the lease to the new property owner

The Agency proposed an adjustment to the “site plan or equivalent drawing” requirement. The

Agency’s understanding is that site plans are often completed by an engineer after the installation

contract is signed and that it may be burdensome to require the site plan to be completed prior to

contract execution. Therefore, the Agency will allow Approved Vendors and Designees to incorporate

the site plan or equivalent drawing in the contract by reference, as long as the site plan or drawing is

completed and provided to the customer within 30 days and is substantially consistent with the

system specifications in the contract and Disclosure Form. This will ensure that the customer is still

provided with the site plan in a reasonably timely fashion and not subjected to a bait-and-switch.

9.4.2.2. Special Considerations for Community Solar

Approved Vendors and Designees involved in acquiring subscribers for community solar projects

receiving incentives under the Adjustable Block Program must adhere to the requirements set forth

in the Consumer Protection Handbook, which incorporates requirements previously found in the

Guidelines for Community Solar Marketing Materials and Marketing Behavior (“CS Marketing

Guidelines”). While a subscription to a community renewable generation project is not the same as

the installation of a distributed generation system, it does bear similarities to taking supply service

from Alternative Retail Electric Supplier.

Based on ARES practices, the Agency recognizes that door to door, telemarketing, or online sales of

community renewable generation subscriptions may be marketing channels of particular concern

because of the information asymmetry between the salesperson and the consumer. The Agency

believes an informed consumer is a wise consumer and strongly encourages marketing channels that

respect the opportunity for consumers to have complete and accurate information about the

decisions they may make regarding subscriptions, particularly those related to upfront payments,

the net price of energy, and termination fees and conditions. The Agency and/or its Program

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Administrators may conduct additional monitoring of Approved Vendors and their Designees

(and/or their partners/affiliates) that utilize door to door, telemarketing, and online sales, and

reserve the right to request the Approved Vendor or Designee provide additional documentation of

those marketing channels including, but not limited to, access to call center recordings for either sales

or third-party verifications.

The CP Handbook sets out provisions for marketing community solar subscriptions, including

requirements for providing documents to customers, the process for contract execution, sales agent

training and recordkeeping, and complaint and disciplinary processes. Approved Vendors and

Designees are unequivocally prohibited from engaging in unfair, deceptive, or abusive business

practices in their involvement with the programs.

As described in the IPA’s Initial and Revised Plans, there are a number of state and federal consumer

protection laws, regulations, and enforcement agencies that apply to all forms of marketing, including

marketing of subscriptions to Community Renewable Generation Projects.

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Table 9-1: Federal Statutes that Apply to Community Solar

Statute

Topic

CAN-SPAM Act

Electronic marketing

Consumer Leasing Act

Leasing disclosures

Electronic Funds Transfer Act

Consumer rights in electronic fund transfers

Equal Credit Opportunity Act

Discrimination in credit transactions

Fair Credit Reporting Act

Collection and use of consumer information

Federal Trade Commission Act

Unfair and deceptive trade practices

Magnuson-Moss Warranty Act

Consumer product warranties

Right to Financial Privacy Act

Financial privacy from government intrusion

Truth in Lending Act

Lending disclosures and standardization

Telephone Consumer Protection Act

Telemarketing and automated telephone

equipment

Unfair Deceptive Practices Act (UDAAP)

Misleading financial products and services

Uniform Commercial Code

Sales and commercial transactions

Source: CESA, Consumer Protection for Community Solar: A Guide for States, 2017.

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Diana Chace and Nate Hausman, Clean Energy States Alliance, Consumer Protection for Community Solar: A Guide for States, June 8, 2017.

http://cesa.org/resource-library/resource/consumer-protection-for-community-solar-a-guide-for-states.

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Table 9-2: Illinois Statutes that Apply to Community Solar

Statute

Topic

Consumer Fraud and Deceptive Business

Practices Act (815 ILCS 505)

Enrollment, marketing, billing, and collection by

electric service providers

Electronic Mail Act (EMA) (815 ILCS 511)

Regulates e-mail solicitations

Telephone Solicitations Act (815 ILCS

413) and the Restricted Call Registry Act

(815 ILCS 402)

Regulates telemarketing practices

Personal Information Protection Act (815

ILCS 530)

Requires companies that collect personal

information to take reasonable measures to

protect it and report unauthorized access to

consumer’s personal information.

These laws and regulations provide a starting point for protecting consumers, but their enforcement

agencies typically only track and enforce violations if triggered by consumer complaints. The Agency

will collaborate with the Office of the Attorney General, the Commission, and law enforcement as

applicable in accordance with the provisions of Section 9.8, below, to ensure compliance with these

requirements. The CP Handbook details the use of the standard disclosure forms, and further

requirements surrounding the use of these forms are included below in Section 9.5. Additionally, in

order to ensure that subscribers are well-informed and thus afforded adequate consumer

protections, the Agency requires that all projects also adhere to the minimum contract requirements

outlined in Section 9.4.2.3, below.

9.4.2.3. ABP CS Minimum Contract Requirements

The Agency requires that Approved Vendors and/or their Designees seeking or receiving REC

delivery contracts to support community solar projects through the Adjustable Block Program must

include each of the following in any contracts entered into with subscribers:

(a) A plain language disclosure of the subscription, including:

(i) The terms under which the pricing will be calculated over the life of the contract

and a good faith estimate of the subscription price expressed as a monthly rate or on

a per kilowatt-hour basis;

(ii) Whether any charges may increase during the course of service, and, if so, how

much advance notice is provided to the subscriber.

(b) Contract provisions regulating the disposition or transfer of a subscription;

(d) All recurring (monthly, yearly) charges;

(e) A statement of contract duration, including the initial time period and any rollover

provision;

(f) Terms and conditions for early termination, including:

(i) Any penalties that the Project Developer may charge to the subscriber; and

(ii) The process for unsubscribing and any associated costs.

(g) If a security deposit is required:

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(i) The amount of the security deposit;

(ii) A description of when and under what circumstances the security deposit will be

returned;

(iii) A description of how the security deposit may be used; and

(iv) A description of how the security deposit will be protected.

(h) A description of any fee or charge and the circumstances under which a customer may

incur a fee or charge;

(i) A statement explaining any conditions under which the Project Developer may terminate

the contract early, including:

(i) Circumstances under which early cancellation by the Project Developer may occur;

(ii) Manner in which the Project Developer shall notify the customer of the early

cancellation of the contract;

(iii) Duration of the notice period before early cancellation; and

(iv) Remedies available to the customer if early cancellation occurs;

(j) A statement that the customer may terminate the contract early, including:

(i) Amount of any early cancellation fee;

(k) A statement describing contract renewal procedures, if any, including any automatic

renewal provisions;

(l) A dispute procedure;

(m) The Agency’s and Commission’s phone number and Internet address;

(n) A billing procedure description;

(o) The data privacy policies of the Project Developer;

(p) A description of any compensation to be paid for underperformance;

(q) Evidence of insurance;

(r) A description of the project’s long-term maintenance plan;

(s) Current production projections and a description of the methodology used to develop

production projections;

(t) Contact information for the Project Developer for questions and complaints;

(u) A statement that the Project Developer does not make representations or warranties

concerning the tax implications of any bill credits provided to the subscriber;

(v) The method of providing notice to the subscribers when the project is out of service for

more than three business days, including notice of:

(i) The estimated duration of the outage; and

(ii) The estimated production that will be lost due to the outage.

(w) Any other terms and conditions of service.

In addition, to ensure portability and transferability of subscription contracts, as required by Section

1-75(c)(1)(N) of the Act, any such contract should provide that the subscriber (i) may retain the

subscription (or at least a downsized version of the subscription relative to the subscriber’s new

load) as long as the subscriber changes addresses for utility service within the same utility service

territory, and (ii) may assign or sell the subscription to another person within the same utility service

territory, without any fee owed to the subscription counterparty, subject to reasonable terms and

conditions including matching the subscription size to the new subscriber’s load. Section 1-

75(c)(1)(N) states that requirements that community solar subscriptions be “portable and

“transferable” can be “[s]ubject to reasonable limitations,” and the Agency believes this approach fits

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that standard. The Agency understands that the community renewable net metering tariffs for

Ameren Illinois and ComEd approved by the Commission are consistent with these principles.

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9.4.3. ILSFA Program Requirements

Like the Adjustable Block Program, Illinois Solar for All Program requirements are outlined in this

Plan and through additional documents developed by the Agency and the Program Administrator to

facilitate the administration of the program. Program requirements for participants in ILSFA are laid

out in Chapter 8 of this Plan and detailed in the Approved Vendor Manual (“AV Manual”), customer

contract provisions for both low-income community solar and low-income distributed generation

sub-programs, and the Consumer Protection Handbook (“CP Handbook”), which incorporates

requirements previously set out in the Consumer Protection Guidelines for Low-Income Distributed

Generation and Low-Income Community Solar. Approved Vendors and Designees alike are required

to be familiar with and comply with all program requirements in order to remain in good standing

with the program.

While Chapter 8 of this Plan outlines the primary goals and requirements for ILSFA, detail regarding

the implementation of those requirements is explained in the AV Manual, which provides necessary

detail on program requirements across all program categories and processes. As such, some items

related to the consumer protection provisions in Public Act 102-0662 (for example, the processes for

Approved Vendor applications, Designee registrations, and project inspections) are outlined in the

AV Manual. The Agency, along with the Program Administrator, works to update the AV Manual on

a regular basis to ensure that requirements are in step with the program as it develops. Most

recently, the AV Manual was updated in April of 2021 to outline program requirements for the 2021-

2022 program year.

When discussing consumer protection program requirements applicable to the ILSFA program, it is

important to consider the communities that the program was designed to serve. Low-income

communities have been historically underserved by programs that offer resources and incentives for

energy, housing, and access to capital, and as a result have had very low participation in the clean

energy economy generally. This low participation level has created a significant information gap

within such communities. At the same time, low-income communities have often been targeted with

false or deceptive marketing practices, predatory sales, unfair contracts, and low-quality

workmanship. The requirements for consumer protections within the Illinois Solar for All Program

are designed to address these realities.

In addition to the AV Manual, there are several other documents necessary to the topic of consumer

protections within ILSFA, as they set forth program requirements or are essential for compliance

with those requirements, including:

• CP Handbook (found in Appendix I-1 to this Plan), which incorporates requirements

previously found in Consumer Protections for Low-Income Distributed Generation and

Consumer Protections for Low-Income Community Solar

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As noted in Section 7.9.6.3, both Ameren Illinois and Commonwealth Edison currently have tariffs related to community solar net

metering open before the Commission; neither utility has proposed to change the portability and transferability provisions of its tariffs.

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• Program brochures, available in both English and Spanish, for the following subcategories:

Low-Income Distributed Generation,

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Low-Income Community Solar,

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and Non-Profits

and Public Facilities

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• Contract Requirements – minimum contract terms for both distributed generation and

community solar technologies

• Standard Disclosure Forms, some of which are currently available in both English and

Spanish, for the various distributed generation forms, differentiated by financing type, as well

as for community solar; instead of a separate Disclosure Form for Non-Profit/Public Facility

projects, the Agency will require that the new streamlined, uniform forms for each financing

type—once finalized—be used regardless of project size.

The supporting documents as listed above and attached hereto in Appendices I-1 and I-2 work in

concert with the AV Manual to ensure that program participants (Approved Vendors and Designees)

are aware of all program requirements. These documents were developed and informed in part by

the program requirements for the Adjustable Block Program and include specific additional

requirements to ensure protections for higher-risk communities that are served by the Illinois Solar

for All Program. It is the Agency’s hope that through development of these requirements, customers

who encounter the program are educated about the benefits and costs of photovoltaic installation

and/or community solar subscriptions. The Agency firmly believes that a well-informed Approved

Vendor/Designee can ensure that customers have a positive experience and understand the program

and their offer, so goes to great lengths to ensure Approved Vendors/Designees are well informed,

while simultaneously maintaining a focus on consumer education and protection.

9.4.3.1. ILSFA DG and NP/NF Contract Requirements

The Illinois Solar for All Program provides incentives to low-income customers and communities and

therefore includes a set of considerations around minimum contract requirements that is different

from the Adjustable Block Program to provide additional protections and guarantees for more

vulnerable populations. For the Illinois Solar for All Program, the Agency requires that Approved

Vendors seeking REC delivery contracts associated with the Low-Income Single-Family and Small

Multifamily Solar Incentive, the Low-Income Large Multifamily Solar Incentive, and the Incentives for

Non-Profits and Public Facilities must include each of the following in any contracts entered into with

participants:

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• Contract must be in the language requested by the customer.

• 1-4 unit Low-income Distributed Generation customers cannot be required to provide an

upfront payment prior to energization.

• Once energization begins, any ongoing payments (on an annualized basis) by customer

cannot exceed 50% of expected first-year net metering value. This requirement applies to

two distinct time periods: (1) the first year of the contract as well as (2) a calculated annual

average for (a) the life of the customer’s contract or (b), in the case of a purchase transaction

or a lease/PPA with a buyout option, a 25-year period. For these calculations, the following

assumptions must hold:

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https://www.illinoissfa.com/app/uploads/2019/05/0419-ILSFA-infosheet-distributed-generation-v10.pdf.

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https://www.illinoissfa.com/app/uploads/2019/10/0919-ILSFA-infosheet-low-income-community-solar-v11.pdf.

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https://www.illinoissfa.com/app/uploads/2019/05/ILSFA-brochure-non-profits-public-facilities.pdf.

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These requirements also apply to contracts between Designees and participants.

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o A standard annual production degradation rate of 0.5% must be used;

o An annual energy price escalation rate of up to 1.7% can be used;

o The annual customer payment rate escalation cannot exceed the energy escalation

rate used.

o For Low-Income Distributed Generation projects, the first-year net metering value

used in the savings calculation must be based on either (i) the rate listed on the

Disclosure form, or (ii) an average of the customer’s 12 most recent monthly bills.

o For Non-profit/Public Facility projects, the first-year net metering value used in the

savings calculation must be based on an average of 12 consecutive months of

customer bills within the last two years.

• Full system warranty, as well as operations and maintenance guarantees for the duration of

the REC Contract or 15 years, at no additional cost to participants.

• Financing amounts, terms, and conditions for a purchase or lease of a system must be based

on an assessment of the Program participant’s ability to repay the debt, as defined by

Regulation Z, which is a federal rule that implements aspects of the Truth in Lending Act and

the Dodd-Frank Act.

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• Right of rescission within fourteen

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business days after contract execution (only for Low-

Income Distributed Generation; not for Non-profits/Public Facilities)

• System design specification:

• Site plan or equivalent drawing (this may be incorporated by reference, in which case

the site plan or equivalent drawing must be completed and provided to the customer

within 30 days of the contract execution and must be substantially consistent with

the specifications contained in the contract and Disclosure Form)

o Size of system

o Type of panels

o Estimated first year production and annual degradation

• Change in pricing or other terms, if any, in the event of non-selection for an ILSFA REC

contract. As an example, a condition precedent clause would satisfy this requirement.

• Allocation of responsibility for securing municipal permits and approvals

• Installer will be responsible for completing interconnection application if customer requests

it.

• Allocation of responsibility for harm to property, materials, and workers during construction

• Installer commits to not pass on any costs related to curing problems found in project

inspections conducted by the Illinois Power Agency or its designees.

• Installer commits to provide name of any subcontractor to customer before work begins.

• Requirement that any change order, including scope and price, must be confirmed in writing

• Allocation of responsibility for entering meter data (This provision could be in a separate

contract.)

• All possible fees (other than those mentioned in the requirements for particular business

types)

601

See Consumer Financial Protection Bureau, April 10, 2013. Ability-to-Repay and Qualified Mortgage Rule, Small Entity Compliance Guide,

http://files.consumerfinance.gov/f/201304_cfpb_compliance-guide_atr-qm-rule.pdf. Under the regulation (12 C.F.R. § 1026.43, issued

under authority of 15 U.S.C. § 1639c), creditors generally must consider eight underwriting factors: (1) current or reasonably expected

income or assets; (2) current employment status; (3) the monthly payment on the covered transaction; (4) the monthly payment on any

simultaneous loan; (5) the monthly payment for mortgage-related obligations; (6) current debt obligations, alimony, and child support;

(7) the monthly debt-to-income ratio or residual income; and (8) credit history.

602

The Final Order in Docket No. 22-0231 approved the Agency’s proposal to (1) eliminate a required waiting period between presentation

of the Disclosure Form to an ILSFA DG customer and the signing of the installation contract, and (2) extend the rescission period from

seven to fourteen days. Docket No. 22-0231, Final Order dated July 14, 2022 at 127.

Illinois Power Agency 2022 Long-Term Plan (Final) August 23, 2022

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• Dispute resolution procedures

• Governing law

• No prepayment penalties (only for Low-Income Distributed Generation; not for Non-

profits/Public Facilities)

• When mechanic’s lien waiver(s) will be provided

As with the ABP Distributed Generation Contract Requirements, the Agency also proposed an

adjustment to the “site plan or equivalent drawing” requirement. The Agency’s understanding is that

site plans are often completed by an engineer after the installation contract is signed and that it may

be burdensome to require the site plan to be completed prior to contract execution. Therefore, the

Agency will allow Approved Vendors and Designees to incorporate the site plan or equivalent

drawing in the contract by reference, as long as the site plan or drawing is completed and provided

to the customer within 30 days and is substantially consistent with the system specifications in the

contract and Disclosure Form. This will ensure that the customer is still provided with the site plan

in a reasonably timely fashion and not subjected to a bait-and-switch.

9.4.3.2. ILSFA LICS Contract Requirements

Similar to the additional considerations for low-income distributed generation projects, the Agency

requires that Approved Vendors seeking REC delivery contracts associated with Community

Renewable Generation Facilities participating in the Illinois Solar for All Program must include each

of the following in any contracts entered into with subscribers.

603

The requirements regarding

security deposits (formerly in section (g)) have been eliminated, as no upfront payments are

permitted under ILSFA.

(a) A plain language disclosure of the subscription, including:

(i) The terms under which the pricing will be calculated over the life of the contract

and a good faith estimate of the subscription price expressed as a monthly rate or on

a per kilowatt-hour basis;

(ii) Whether any charges may increase during the course of service, and, if so, how

much advance notice is provided to the subscriber.

(b) Contract provisions regulating the disposition or transfer of a subscription, as well as the

costs or potential costs associated with such a disposition or transfer;

(d) All recurring (monthly, yearly) charges;

(e) A statement of contract duration, including the initial time period and any rollover

provision;

(f) Terms and conditions for early termination, including:

(i) Any penalties that the Project Developer may charge to the subscriber; and

(ii) The process for unsubscribing and any associated costs.

(g) A description of any fee or charge and the circumstances under which a customer may

incur a fee or charge;

(h) A statement explaining any conditions under which the Project Developer may terminate

the contract early, including:

(i) Circumstances under which early cancellation by the Project Developer may occur;

603

These requirements also apply to Designees managing community solar subscriptions for an Approved Vendor.

Illinois Power Agency 2022 Long-Term Plan (Final) August 23, 2022

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(ii) Manner in which the Project Developer shall notify the customer of the early

cancellation of the contract;

(iii) Duration of the notice period before early cancellation; and

(iv) Remedies available to the customer if early cancellation occurs;

(i) A statement that the customer may terminate the contract early, including:

(i) Amount of any early cancellation fee;

(j) A statement describing contract renewal procedures, if any;

(k) A dispute procedure;

(l) The Agency’s and Commission’s phone number and Internet address;

(m) A billing procedure description;

(n) The data privacy policies of the Project Developer;

(o) A description of any compensation to be paid for underperformance;

(p) Evidence of insurance;

(q) A description of the project’s long-term maintenance plan;

(r) Current production projections and a description of the methodology used to develop

production projections;

(s) Contact information for the Project Developer for questions and complaints;

(t) A statement that the Project Developer does not make representations or warranties

concerning the tax implications of any bill credits provided to the subscriber;

(u) The method of providing notice to the subscribers when the project is out of service for

more than three business days, including notice of:

(i) The estimated duration of the outage; and

(ii) The estimated production that will be lost due to the outage.

(v) Any other terms and conditions of service.

(w) Once energization begins, any ongoing subscription payments (on an annualized basis)

by customer cannot exceed 50% of expected first-year net metering value. This requirement

applies to two distinct time periods: (1) the first year of the contract as well as (2) a calculated

annual average for (i) the life of the customer’s subscription contract or (ii) in the case of a

system share purchase, for 25 years. For these calculations, the following assumptions must

hold:

o A standard annual production degradation rate of 0.5% must be used;

o An annual energy price escalation rate of up to 1.7% can be used;

o The annual customer payment rate escalation cannot exceed the energy

escalation rate used.

o The first-year net metering value used in the savings calculation must be based

on either (i) an average statewide supply rate of $0.06 per kilowatt-hour or (ii) an

average of the customer’s 12 most recent monthly utility bills.

(x) The contract must be in the language requested by the customer.

(y) Financing amounts, terms, and conditions for a purchase of a system share or a lease-

based subscription must be based on an assessment of the program participant’s ability to

repay the debt, as defined by Regulation Z, which is a federal rule that implements aspects of

the Truth in Lending Act and the Dodd-Frank Act.

604

(z) Right of rescission within three days after contract execution

(aa) The subscriber cannot be required to provide an upfront payment prior to energization.

604

See Consumer Financial Protection Bureau, April 10, 2013. Ability-to-Repay and Qualified Mortgage Rule, Small Entity Compliance Guide,

http://files.consumerfinance.gov/f/201304_cfpb_compliance-guide_atr-qm-rule.pdf. Under the regulation (12 C.F.R. § 1026.43, issued

under authority of 15 U.S.C. § 1639c), creditors generally must consider eight underwriting factors: (1) current or reasonably expected

income or assets; (2) current employment status; (3) the monthly payment on the covered transaction; (4) the monthly payment on any

simultaneous loan; (5) the monthly payment for mortgage-related obligations; (6) current debt obligations, alimony, and child support;

(7) the monthly debt-to-income ratio or residual income; and (8) credit history.

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(bb) No prepayment penalties (for a lease or a loan for purchasing a project share) are

allowed.

(cc) For situations where a low-income residential customer is taking a loan to finance

purchase of particular panels or a share of the community solar project from a lender

affiliated with an Approved Vendor:

o Financial instrument must include forbearance terms.

▪ Forbearance terms must encompass one of the following:

• Suspension of total payments for up to 3 months; or

• Suspension of interest payments for up to 6 months; or

• Reduction of interest payments for up to 12 months

▪ Missed revenues may be recovered later in the contract life, but no interest may be

applied.

o Loan may not be secured by home or home equity

o Loan documents must indicate the following:

▪ Principal loan amount

▪ Schedule of loan disbursements

▪ Schedule and due dates of repayments

▪ Order of allocating payments (to principal, interest, fees, etc.)

▪ Interest rate

▪ Borrower(s), lender, servicer

▪ Nature of lender’s security interest (e.g., UCC-1 financing statement)

▪ Events of default and lender’s remed(ies) upon default (including forbearance as

discussed above)

▪ All fees and penalties

In addition, to ensure portability and transferability of subscription contracts, as required by Section

1-75(c)(1)(N) of the Act, any such contract should provide that the subscriber (i) may retain the

subscription (or at least a downsized version of the subscription relative to the subscriber’s new

load) as long as the subscriber changes addresses for utility service within the same utility service

territory, and (ii) may assign or sell the subscription to another person within the same utility service

territory, without any fee owed to the subscription counterparty, subject to reasonable terms and

conditions including matching the subscription size to the new subscriber’s load. The Agency

understands that the community renewable net metering tariffs for Ameren Illinois and ComEd

approved by the Commission are consistent with these principles.

605

9.5. Standard Disclosure Form Requirements

Since the inception of the Adjustable Block and Illinois Solar for All Programs, the Agency has

required that standard disclosure forms be provided to customers for their signature, with those

customer-executed forms then submitted to the appropriate Program Administrator. The customer

must sign their completed Disclosure Form prior to signing their contract. In its Order approving the

Agency’s Revised Long-Term Plan, the Commission provided analysis reinforcing the requirement

that every individual subscriber to a community solar project participating in the Adjustable Block

Program or ILSFA must receive and execute an individualized standard disclosure form.

606

The Final

605

As noted in Section 7.9.6.3, both Ameren Illinois and Commonwealth Edison currently have tariffs related to community solar net

metering open before the Commission; neither utility has proposed to change the portability and transferability provisions of its tariffs.

606

Docket No. 19-0995, Final Order dated February 18, 2020 at 7.

Illinois Power Agency 2022 Long-Term Plan (Final) August 23, 2022

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Order in Docket No. 22-0231 reiterates this approval of requiring customer signature on

individualized Disclosure Forms.

607

The specific provisions regarding disclosure forms, including

how they are to be generated and executed, are outlined in the ABP Program Guidebook, ILSFA

Approved Vendor Manual, and the Consumer Protection Handbook contained in Appendix I to this

Plan.

Section 1-75(c)(1)(M)(iii) of the IPA Act now expressly provides that the Agency may “require direct

program participants, including agents operating on their behalf, to provide standardized disclosures

to a customer prior to that customer's execution of a contract for the development of a distributed

generation system or a subscription to a community solar project.” Materials for each program

specify that the customer must receive, review, and execute that disclosure form before, or no later

than in conjunction with, that customer’s execution of its contract for the distributed generation

system or the community solar subscription. If executed in conjunction with a contract, the disclosure

form must be signed prior to the contract.

Approved Vendors and Designees are not permitted to develop their own version of disclosure forms

in lieu of the standard Adjustable Block Program or Illinois Solar for All forms, nor may Approved

Vendors or Designees modify any portion of the form’s standardized content. When the programs

first launched, Disclosure Forms could be generated only through the Program Administrator’s

portal. This portal-only process facilitated the Program Administrators’ reviews of project

applications by ensuring that no Approved Vendors or Designees modified the standard disclosure

form prior to obtaining a customer signature on the forms. In response to requests from program

participants, the Program Administrators have developed application programming interfaces

(“APIs”) that can now be utilized by Approved Vendors and Designees to generate disclosure forms

outside of the program portals so long as the content remains the standard content. This process

may be utilized by Approved Vendors/Designees only after obtaining permission from the Program

Administrator(s) following a test of the disclosure form generated through the API. In this way, the

Program Administrators can ensure that program requirements are being met and that customers

receive the required standardized (i.e., unmodified) forms.

The Disclosure Forms are currently provided in English, with the ABP Community Solar Disclosure

Form and the ILSFA DG lease, DG PPA, and Community Solar Disclosure Forms also provided in

Spanish. After the finalization of the new streamlined Disclosure Forms following a stakeholder

process, the Agency plans to produce versions of all of the Disclosure Forms in Spanish and any other

languages that the Informational Brochures are provided in.

The Agency, through its ABP Program Administrator, has seen voluminous examples of companies

sending Disclosure Forms to email addresses associated with the sales representative, or other

company email addresses. This behavior is extremely troubling, as the forms are sent to the customer

for execution using an email address that does not belong to the customer, making it difficult for the

Program Administrator to verify the identity of the signor. In some cases, the Agency, through its

Program Administrator, has seen examples of agents creating false customer email addresses, which

are then used to generate customer disclosure forms. These situations are brought to the attention

of the Program Administrator in part through customer complaints, as well as a review of the

607

Docket No. 22-0231, Final Order dated July 14, 2022 at 149-150.

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disclosure forms that are submitted with project applications (at Part I of the application process for

distributed generation, and at Part II of the application process for community solar). Program

Administrator investigations into the use of incorrect or false email addresses have shown that on

some occasions, agents are assisting customers who do not have email addresses, while at other

times agents are acting outside of program requirements surrounding disclosure forms. In order to

prevent Approved Vendors, Designees, subcontractors, and/or other agents from engaging in this

deceptive practice, and to avoid the possibility of so-called “bad actors” from executing disclosure

forms on the behalf of customers, the Agency requires that all customer disclosures be sent to an

email address belonging to the customer for e-signature. If the customer does not have an email

address, or does not wish to share it, an email address waiver form is available, and the customer will

need to wet sign a hard copy of the Disclosure Form.

The Agency requires that all Disclosure Forms executed outside of the ABP portal (which is only

permitted through the API process described above) must utilize a commercially-available third

party e-signature platform in order to provide an independent audit trail of the customer’s signature.

Commercially available third-party signature platforms are systems that are available to the public

under standard terms and conditions or are available at list prices offered to the public. Such

commercially-available platforms are widely available through well-known providers such as

DocuSign and Acrobat, though at a charge to the user. Approved Vendors and Designees that do not

wish to incur the charges for use of these commercially-available third-party signature verification

platforms may use the signature features available within the ABP portal without incurring

additional charges. While the Agency understands that some entities participating in the programs

may have their own internal e-signature platforms, the Agency believes that it is imperative to

require a commercially available e-signature verification tool to ensure that bad actor agents cannot

disrupt and/or circumvent the Agency’s consumer protection process. This requirement is not new

to the program requirements, but recently has gained attention as community solar subscriptions

became more widely available in Illinois. The IPA thus sought that the Commission affirm this

specific requirement through its Plan.

The Agency has received feedback that the Disclosure Forms for both the ABP and ILSFA should be

streamlined and shortened. As part of this 2022 Plan, the Agency is submitting updated and revised

Disclosure Forms for ABP and ILSFA, and for both distributed generation projects and community

solar subscriptions. The forms are designed to be shorter, to focus on the key information while

flagging other issues of which the customer should be aware, and to increase consistency in

Disclosure Form design and content across all offers. Additional details on the new proposed forms

are discussed below. The Agency is open to further modifications to these Disclosure Forms through

a stakeholder process, which it plans to commence in the fall of 2022; however, the Agency felt it was

important to provide new, redesigned documents as a starting place for further adjustments. As with

other program documents and materials, the Agency requested Commission approval of the

Disclosure Form requirement and the general approach in the attached proposed new Disclosure

Forms, while allowing adjustments to be made outside of the Long-Term Plan process prior to the

next Plan filing. The Commission specifically approved the requirement for customer-specific

Disclosure Forms and the requirement that the customer sign their Disclosure Form, as well as the

Agency’s proposal to continue to update Program documents, as appropriate, outside of the Plan

proceeding.

608

See Docket No. 22-0231, Final Order dated July 14, 2022 at 137, 149-150.

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Various versions of the new Disclosure Forms are included in Appendix I-2, including forms for ABP

DG purchases, leases, PPAs; ABP community solar subscriptions; ILSFA purchases, leases, PPAs; and

ILSFA community solar subscriptions. The Agency will initiate a stakeholder process to consider

additional modifications to these new Disclosure Forms before finalizing them and requiring their

use. Because the forms now all look very similar, and there have already been instances of AVs or

Designees filling out and having customers sign the wrong type of form (e.g., a DG form instead of a

community solar form), different form types will now have different color schemes: blue for ABP DG

forms, green for ABP community solar forms, and yellow for ILSFA forms.

The Disclosure Forms incorporate dynamic elements, which allow for information that is only

relevant for some offers to only appear on the Disclosure Form for those offers where it is relevant,

and not be shown when not relevant. This allows the forms to include all important information while

not cluttering up and lengthening the forms with unhelpful text. Appendix I therefore includes

multiple versions of some of the same Disclosure Forms to show the dynamic elements and how the

form would appear when different inputs are given.

The Agency received feedback from stakeholders surrounding the requirements for customers to

execute an additional disclosure form when the terms of their agreement have changed. Specifically,

if the size of a customer’s distributed generation system or community solar subscription changes

beyond the allowable size bands (greater of 5% or 1 kW AC for DG; greater of 2kW or 10% for

Community Solar subscriptions), or – in the in the case of community solar – if the customer’s

subscription is moved from one project to another, they must be presented with a new, updated

disclosure form, which must be executed by the customer prior to changes in the customer’s

agreement with the Approved Vendor/Designee. Stakeholders have requested that the Agency lift

this requirement for changes to community solar subscriptions in order to ensure that customers’

subscription sizes can be right-sized to the customers’ needs or changes in usage.

609

Previously, the

IPA was unwilling to accept these changes without guardrails in order to reduce the possibility for

gaming by Approved Vendors seeking to maximize payments under REC Contracts by adjusting

subscription sizes or switching customers to undersubscribed projects at the end of an invoicing

period. In order to facilitate right-sizing of community solar subscriptions, the Agency proposed a

modified approach: (1) for subscriptions where the customer pays a set percentage of their

community solar bill credits as their subscription fee (guaranteeing a set percentage level of savings),

subscriptions may be increased or decreased by up to 5 kW or 25% without requiring a new

Disclosure Form; however, the Approved Vendor or Designee must notify the customer for

adjustments more than 2 kW or 10%; (2) for all other offer structures, the existing size restrictions

(the greater of 2 kW or 10%) will continue to apply.

In the 2022 Plan approval proceeding (Docket No. 22-0231), in response to parties’ arguments, the

Agency proposed additional flexibility with respect to moving customers between community solar

projects. Specifically, the Agency proposed to allow Approved Vendors/Designees to switch a

customer from one community solar project to another without the execution of a new Disclosure

Form in two situations: (1) when the customer requests the switch, or (2) when the customer

609

While not specifically referenced, the Agency understands that these comments are only applicable to customers subscribed to a project

within the Traditional Community Solar category, rather than the Community-Driven Community Solar category.

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318

requests a subscription size increase that cannot be accommodated by their current project. The

Agency’s updated proposal was approved by the Commission in its Final Order.

610

9.5.1. ABP Disclosure Forms

The Agency, in conjunction with its Program Administrator, developed standardized disclosure

forms to be completed and provided to each program participant for signature prior to contract

execution. The standard disclosure form must be presented without modification to all customers

who host a distributed generation project which will participate in the program, as well as all

customers who enroll as subscribers to community solar projects participating in the program. In its

Order approving the Agency’s Revised Plan in Docket 19-0995, the Commission provided analysis

reinforcing the requirement that every individual subscriber to a community solar project

participating in the Adjustable Block Program must receive and execute an individualized standard

Disclosure Form.

611

The Commission reiterated its approval of this requirement in the Final Order in

Docket 22-0231.

612

This requirement extends across all six distinct categories of the program.

For distributed generation projects, there are standard Disclosure Forms for project purchases,

leases, and PPAs. The Agency is synthesizing the Disclosure Form for projects over 25 kW in size

with the streamlined form also applicable to projects under 25 kW in size, as it believes these projects

are better addressed with the Disclosure Forms specific to the DG offer type (purchase, lease, or PPA).

The DG Disclosure Forms provide important information in a standardized format, including:

• contact information

• information on pricing, payment amount and timing, and fees

• information on REC incentive payments, including amount of the expected payment and how

much is passed on to the customer

• information on the solar project itself, including installation, design, and efficiency

• information on net metering

• information on maintenance, warranties and guarantees

• information on what happens if the customer moves

• information on early termination or completion of the contract (for lease and PPA)

• estimates of the value of electricity produced by the project and estimated savings

The proposed new DG Disclosure Forms for both ILSFA and ABP incorporate a dynamic element to

address offers that rely on the project using the smart inverter rebate. When the Approved Vendor

or Designee indicates that the project will use the rebate, the section on net metering will be retitled

“Net Metering and Smart Inverter Rebate” and will explain the rebate with related disclosures and

explain how it affects the net metering rate. In the “Value of Electricity and Savings Estimates” section,

the form will state that the estimated value of electricity from the project includes the smart inverter

rebate (if the rebate is retained by the customer), and the value of the electricity calculations will be

adjusted to reflect that electricity estimated to be used directly by the customer will be valued at the

full retail rate, whereas the excess net metered electricity will be valued at the generation rate. There

610

See Docket No. 22-0231, Final Order dated July 14, 2022 at 150.

611

See Docket No. 19-0995, Final Order dated February 18, 2020 at 7. In the event that the Commission or another authoritative

adjudicatory body determines that an opt-out municipal aggregation may legally include community solar subscription aggregation for a

project participating in the Adjustable Block Program or ILSFA, individually executed standard disclosure forms would still be required for

each individual subscriber.

612

See Docket No. 22-0231, Final Order dated July 14, 2022 at 150.

Illinois Power Agency 2022 Long-Term Plan (Final) August 23, 2022

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will also be a new, automatically-generated disclosure section if the Approved Vendor holds a

collateral payment that is later refunded.

613

The Agency provides standard electricity prices (and other inputs) to be used for the estimates of the

value of electricity generated and savings so as to allow customers to make equivalent comparisons

across multiple offers from developers. Standard disclosure forms must be presented to customers

for review and signed by customers confirming that review prior to the execution of the underlying

sales contract to ensure that customers understand the terms and conditions of their installation.

For community solar subscribers, the Disclosure Form includes:

• contact information

• information on the community solar project (if known at the time of form generation and

execution)

• information on the subscription, including size, term, and estimated production

• subscription rate and payment information, including fees

• information on early termination

• estimates of total community solar bill credits, along with savings estimates or information

on how to understand overall savings (this varies by rate structure)

An additional disclosure is automatically generated if the Approved Vendor or Designee indicates

that the community solar offer requires the subscriber to sign up with an Alternative Retail Electric

Supplier for their energy supply. As with the DG Disclosure Form, to acknowledge and demonstrate

receipt and review, customers must execute the community solar disclosure form prior to execution

of the underlying subscription contact; e-signatures are acceptable (and widely utilized given that

community solar subscriber onboard often occurs through online transactions), but to ensure the

integrity of customer execution, only using commercially available third-party e-signature systems.

In 2020, the Agency updated the Community Solar Disclosure Form in response to feedback received

in stakeholder comments, and the revised Community Solar Disclosure Form was shortened and

streamlined. At that time, the Community Solar Informational Brochure was attached to the

disclosure form. This approach will now be taken for all Disclosure Forms—the applicable

Informational Brochure will automatically be attached as the first two pages. For ABP DG purchases,

the Going Solar flyer (formerly the Illinois Shines Timeline) will also be attached.

The Agency previously sought stakeholder feedback on whether there should be a threshold for

system efficiencies in the program to ensure inefficient or suboptimal systems were not sold, leased,

or financed through a PPA to customers unknowingly. Feedback received noted this proposal was

not supported, as it would create barriers to development for customers who desire to install a sub-

optimal system. Rather, stakeholder feedback indicated a need for increased customer education

surrounding system production, and suggested that it be addressed on the disclosure form. As

explained above, the Agency submitted revised Disclosure Forms as part of this 2022 Plan filing,

which will be finalized after a stakeholder process. The Disclosure Forms for distributed generation

projects incorporate a proposed new section that discloses the efficiency of the project using the

format shown in Figure 9-1:

613

The discussion regarding a new section in Disclosure Forms to address the smart inverter “DG” rebate is expanded in the Final Plan as

compared to the initial filed Plan pursuant to the Final Order in Docket No. 22-0231, at 150.

Illinois Power Agency 2022 Long-Term Plan (Final) August 23, 2022

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Figure 9-1: Disclosure Form Project Efficiency Graphic

This disclosure briefly discusses reasons that a system might be less efficient and provides the

specific efficiency of the customer’s project on a bar from 0% to 25%. For projects with “good” (15%-

20%) or “high” efficiency (20%-25%), the bar would be colored green. For “somewhat” efficient

projects (10%-15%), the bar would be yellow. For lower efficiency projects (0%-10%), the bar would

be colored red. The Agency believes that this graphic will help customers quickly and easily

understand what efficiency levels are typical for solar projects (e.g., an efficiency between 20% and

25% might seem very low to someone unfamiliar with solar projects, while in fact, that would be a

quite high efficiency for a solar project) and what the efficiency of their specific project would be

(both as an efficiency percentage for their project, as well as in comparison to other projects). The

Agency remains open to alternative ways to present this information, including a disclosure graphic

that would show the customer their project’s capacity factor in comparison to other ABP and ILSFA

distributed generation projects.

The Agency maintains that it is vital for customers to be provided with resources that explain both

the State-administered incentive program in which the customer is participating as well as the

agreement the customer is entering into with their Approved Vendor or Designee (whether that be a

community solar subscription or the installation of a behind-the-meter distributed generation

system). As such, the Agency intends to continue to provide educational materials through the

program’s informational brochure (which will now be attached to the Disclosure Forms) as well as

the Illinois Shines website and will continue to develop additional robust educational materials that

will address information stripped from the current disclosure forms.

9.5.2. ILSFA Disclosure Forms

As with the ABP, the Agency proposed a new set of redesigned ILSFA Disclosure Forms to address

general feedback that the forms need to be simplified and streamlined, as well as to address more

detailed comments on specific disclosures. The forms are designed to maximize consistency between

ABP and ILSFA, while still tailoring the ILSFA Disclosure Forms to reflect program-specific elements.

There are three new ILSFA distributed generation Disclosure Forms for the three financing types

(purchase, lease, and PPA). Instead of having a separate form for Non-Profits and Public Facilities,

dynamic options are incorporated into the three DG forms to allow for disclosures specific to Non-

Profits and Public Facilities. There is also a redesigned ILSFA community solar Disclosure Form. The

Agency expects that additional ILSFA forms, or modified versions of these forms, will need to be

developed through the Fall 2022 stakeholder process, or subsequent stakeholder processes, to

accommodate new ownership models that may emerge with the encouragement of energy

sovereignty.

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The applicable ILSFA standard disclosure form must be presented without modification to all

customers who host a distributed generation project that will participate in the program, as well as

all customers who enroll as subscribers to community solar projects participating in the program.

Standard disclosure forms must be presented to customers for review and signed by customers

confirming that review prior to the execution of the underlying sales contract to ensure that

customers understand the terms and conditions of their purchase. In its Order approving the

Agency’s Revised Plan in Docket 19-0995, the Commission provided analysis reinforcing the

requirement that every individual subscriber to a community solar project participating in the

Agency’s programs must receive and execute an individualized standard Disclosure Form.

614

The

Commission reiterated its approval of this requirement in the Final Order in Docket 22-0231.

615

This

requirement extends across all four ILSFA categories.

The ILSFA distributed generation Disclosure Forms include:

• contact information

• information on pricing, payment amount and timing, and fees

• information on REC incentive payments

• information on the solar project itself, including installation, design, and efficiency

• information on net metering

• information on maintenance, warranties and guarantees

• information on what happens if the customer moves

• forbearance requirements in the case of default

• information on early termination or completion of the contract (for lease and PPA)

• estimates of the value of electricity produced by the project and estimated savings, including

a calculation of savings as a percentage of the value of energy generated by the solar project

The agency received a comment on the need for ILSFA distributed generation Disclosure Forms to

address the possibility of projects that use the smart inverter rebate (also known as the DG rebate).

Both the ILSFA and ABP proposed new DG Disclosure Forms incorporate a dynamic element to

address offers that rely on the project using the smart inverter rebate. When the Approved Vendor

or Designee indicates that the project will use the rebate, the section on net metering will be retitled

“Net Metering and Smart Inverter Rebate” and will explain the rebate with related disclosures and

explain how it affects the net metering rate. In the “Value of Electricity and Savings Estimates” section,

the form will state that the estimated value of electricity from the project includes the smart inverter

rebate (if the rebate is retained by the customer), and the value of the electricity calculations will be

adjusted to reflect that electricity estimated to be used directly by the customer will be valued at the

full retail rate, whereas the excess net metered electricity will be valued at the generation rate.

As discussed in Section 8.11, the Agency proposed to eliminate the seven-day waiting period between

when an ILSFA customer signs the Disclosure Form and when they can sign their contract, and

proposed to increase the rescission period from seven days to fourteen. The Commission approved

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See Docket No. 19-0995, Final Order dated February 18, 2020 at 7. In the event that the Commission or another authoritative

adjudicatory body determines that an opt-out municipal aggregation may legally include community solar subscription aggregation for a

project participating in the Adjustable Block Program or ILSFA, individually executed standard disclosure forms would still be required for

each individual subscriber.

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Docket No. 22-0231, Final Order dated July 14, 2022 at 149-150.

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this approach

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and these changes are reflected in the new ILSFA distributed generation Disclosure

Forms.

The ILSFA community solar subscription Disclosure Form includes:

• contact information

• information on the community solar project

• information on the subscription, including size, term, and estimated production

• subscription rate and payment information, including fees

• information on early termination, transferring the subscription, and subscription renewal

• estimates of total community solar bill credits, along with savings estimates, including

savings as a percentage of the value of energy generated by the subscription

An additional disclosure is automatically generated if the Approved Vendor or Designee indicates

that the community solar offer requires the subscriber to sign up with an Alternative Retail Electric

Supplier for their energy supply.

To acknowledge and demonstrate receipt and review, customers must execute the community solar

Disclosure Form prior to execution of the underlying subscription contact; e-signatures are

acceptable (and widely utilized given that community solar subscriber onboard often occurs through

online transactions), but to ensure the integrity of customer execution, only using commercially

available third-party e-signature systems.

The Agency maintains that it is vital for customers to be provided with resources that explain both

the State-administered incentive program in which the customer is participating as well as the

agreement the customer is entering into with their Approved Vendor or Designee (whether that be a

community solar subscription or the installation of a behind-the-meter distributed generation

system). As such, the Agency intends to continue to provide educational materials through the

program’s informational brochures (which will now be attached to the Disclosure Forms) as well as

on the Illinois Solar for All website and will continue to develop additional robust educational

materials specifically designed to meet the needs of the communities served by the Illinois Solar for

All Program.

9.6. Consumer Complaint Center and Complaint Database

Section 1-75(c)(1)(M)(iv) of the IPA Act requires the Agency to establish one or multiple Consumer

Complaint Centers to accept complaints regarding businesses that participate in, or otherwise benefit

from, State-administered incentive funding through Agency-administered programs. Section 1-

75(c)(1)(M)(iv) further requires that the Agency maintain a public database of complaints with any

confidential or particularly sensitive information redacted from public entries.

In March 2020, the ABP Program Administrator launched an online consumer complaint database

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which lists all consumer complaints received by the Program Administrator in an abridged format,

identifying the entity about whom the complaint was filed, the entity’s role in the program (i.e.,

Designee, Approved Vendor), and the date, subject, type, and status of the complaint. The database

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See Docket No. 22-0231, Final Order dated July 14, 2022 at 127.

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This database is hosted on both the Adjustable Block Program website (designed for use by program participants) as well as on the

customer-facing Illinois Shines-branded website. See https://illinoisabp.com/consumer-complaint-database/;

https://illinoisshines.com/consumer-complaint-database/.

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also identifies Approved Vendors and Designees that have been suspended from the program;

additional information related to suspensions for program participants is outlined in a disciplinary

actions report which is also available on the consumer complaint database webpage.

The Program Administrators for both programs will continue to provide consumer protection

materials on a program website and through printed materials. The Adjustable Block Program

Administrator has developed its customer-facing IllinoisShines.com website and program branding

in part to accomplish this end. The Illinois Solar for All Program website highlights information for

Illinois Residents on its homepage, making all such information clearly available to customers. The

Program Administrators will continue to work to develop these websites with materials for

customers as future needs are identified.

The ABP Program Administrator also provides a toll-free consumer protection telephone hotline and

web-based complaint forms, and the Program Administrator receives, responds to, and documents

complaints about marketing practices, sales practices, installations, and other aspects of installing

solar or subscribing to community solar. The Illinois Solar for All Program also maintains a toll-free

customer telephone line for questions and complaints from program participants (i.e., customers and

subscribers). If Approved Vendors and/or Designees are not responsive to the Program

Administrator during a compliant investigation or respond unsatisfactorily to the Program

Administrator during the investigation of a complaint, that Program entity's ABP portal access will

be shut off and the entity will be prohibited from generating Disclosure Forms or submitting Part I

applications. Restricted ABP portal access may be lifted once the entity begins responding in a

satisfactory manner or once the investigation concludes, whichever comes first.

The Illinois Solar for All Program, perhaps as a result of its limited size in comparison to the

Adjustable Block Program, receives significantly fewer customer complaints. As of the date of this

2022 Long-Term Plan, no ILSFA Approved Vendors or Designees have been disciplined for action

arising from consumer complaints specific to the ILSFA Program,

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and accordingly, there is no

customer complaint database that exists on the ILSFA website, though the Agency plans to develop a

database in compliance with the requirements of P.A. 102-0662.

9.7. Annual Complaint Report

Section 1-75(c)(1)(M)(v) of the IPA Act requires the Agency to provide an annual written report to

the Commission documenting the frequency and nature of complaints arising from its programs, as

well as any enforcement actions taken in response to those complaints. This new statutory

requirement mirrors an existing administrative requirement, as it was a provision of the Initial and

Revised Long-Term Plans. The first such report, covering calendar year 2019, was provided to the

Commission through a filing in Docket No. 17-0838 on March 2, 2020. The second report, covering

calendar year 2020, was filed in Docket No. 19-0995 on February 9, 2021.

The Agency will continue to provide an annual written report to the Commission documenting the

frequency and nature of complaints and any enforcement actions taken. As the programs have grown

and changed since their inception, this annual report has consequently changed as well. Low

numbers of complaints associated with the Illinois Solar for All Program have resulted in past reports

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The ILSFA Program Administrator has only sent one suspension letter to date, and it was to an entity that was not registered as an

ILSFA Approved Vendor or Designee. On August 3, 2022, the ILSFA Program Administrator suspended an entity that had misrepresented

the availability of ILSFA incentives to a customer and completed the project in a manner that made it ineligible for ILSFA.

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titled as an “Adjustable Block Program” report, despite the fact that the report includes information

on Illinois Solar for All complaints. For example, in 2020, only five complaints were filed with the

Illinois Solar for All Program Administrator. These complaints were relatively minor in comparison

to the Adjustable Block Program complaints, but nonetheless were briefly explained in the Agency’s

report filed in 19-0995. The Agency has not found that it is necessary to develop a separate annual

report at this time but will assess this need as the program matures. Additionally, the Agency will

ensure that future reports will fully detail complaints received under both programs.

The third annual report, covering calendar year 2021, was filed with the Commission in Docket No.

19-0995 on February 25, 2022. The 2021 report cataloged the complaints received by the Adjustable

Block Program across 2021 and the disciplinary actions taken by the Program Administrators. The

report also describes various challenges the program faced in 2021 and the impact of those

challenges on customer experiences, including but not limited to, the lack of funding to open

additional blocks of capacity prior to the enactment of Public Act 102-0662 and strains on the

program caused by the COVID-19 global health pandemic. Future reports will be published on the

program website and filed in the Commission docket approving the Agency’s most-recently approved

Long-Term Plan.

This report is a vital way that the Agency ensures transparency with the public concerning

complaints received regarding program participants. Continuous monitoring of complaints and

maintenance of the program’s Consumer Protection Database, which documents all complaints

received and suspensions from the program, ensures that resolution and corrective action can be

taken with each specific complaint, and/or the program at large prior to the filing of this public report

each calendar year.

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9.8. Consumer Protection Working Group

Pursuant to the provisions of Section 1-75(c)(1)(M)(vi) of the IPA Act, the Agency shall schedule

regular meetings with representatives of the Office of the Attorney General, the Illinois Commerce

Commission, consumer protection groups, and other interested stakeholders to share relevant

information about consumer protection, project compliance, and complaints received. The IPA has

already developed an ad hoc “Consumer Protection Working Group” and will continue to convene

meetings on a monthly basis. To date, participation in the Working Group has been mostly limited to

the Agency, Program Administrators, Commission staff, Office of the Attorney General, and Citizens

Utility Board, and the meetings have primarily focused on observed consumer protection issues and

violations of program requirements, and disciplinary responses to violations. The Agency received

comments about the openness of these meetings to other interested parties, including the solar

industry. On August 18, 2022, the Agency announced the expansion of the Consumer Protection

Working Group.

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The Agency will recalibrate the meetings as a forum for discussing market trends,

best practices, consumer education, and other consumer protection issues generally with a broader

group of stakeholders. The Agency also intends to continue to meet separately with Commission staff

and the Office of the Attorney General, and other regulatory or legal enforcement agencies and

619

See: https://illinoisabp.com/consumer-complaint-database/.

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The announcement is available at https://ipa.illinois.gov/content/dam/soi/en/web/ipa/documents/illinois-power-agency-

announces-the-expansion-of-the-agencys-consumer-protection-working-group-18-august-2022.pdf.

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consumer protection organizations as appropriate, to discuss specific program violations and

disciplinary actions.

Additionally, 1-75(c)(1)(M)(vii) of the IPA Act requires that, to the extent that complaints received

implicate the jurisdiction of the Office of the Attorney General, the Illinois Commerce Commission, or

local, State, or federal law enforcement, the Agency shall refer complaints to those entities as

appropriate. The IPA will continue to bring such complaints to the attention of the Attorney General

and the Commission as appropriate and will likewise involve other law enforcement agencies as

necessary. If warranted, the Program Administrator will refer complaints to the Agency and to

appropriate state and federal agencies, including the Consumer Fraud Bureau of the Illinois Attorney

General’s Office, or the Illinois Commerce Commission (e.g., for failure of installers to maintain their

status as Certified Distributed Generation Installers). Approved Vendors or Designees found by the

Agency to have violated consumer protection standards or related Program requirements may be

subject to suspension or revocation of their Approved Vendor status or Designee registration by the

Agency, and if in violation of local, state, or federal law, also potential civil or criminal penalties from

other relevant authorities.

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10. Diversity, Equity, and Inclusion

Public Act 102-0662 amended the Illinois Power Agency Act to expand the “priority access to the

clean energy economy for businesses and workers from communities that have been excluded from

economic opportunities in the energy sector, have been subject to disproportionate levels of

pollution, and have disproportionately experienced negative public health outcomes.”

621

To advance

that objective, the Act directs the Agency to establish an equity accountability system, which shall

include:

1. Minimum equity standards applicable to all applicants to the Agency’s renewably energy

procurements, both through the Adjustable Block Program and competitive procurements.

2. The Equity Eligible Contractor category within the Adjustable Block Program (see Chapter 7).

3. Requirements for competitive procurement processes that advance the equity goals of the

Act (see Chapter 5).

The Act further establishes several required monitoring, reporting, and facilitation requirements to

support the assessment of the equity accountability system. Section 1-75(c-10)(4) of the IPA Act

directs the Agency to include the following in each revision to the Long-Term Renewable Resources

Procurement Plan:

4. Current number of Equity Eligible Contractors certified by the Agency.

5. A mechanism for measuring and reporting project workforce profiles at the Approved Vendor

or Designee level.

6. Training, guidance, and other support for Approved Vendors, Designees, Equity Eligible

Contractors, and other stakeholders for meeting the requirements of the EEC category within

Adjustable Block Program and the minimum equity standards laid out in this section.

7. A process for certifying Equity Eligible Contractors and persons (please see Chapter 7 for

more details).

8. A waiver application process for rare cases of inability to meet the minimum equity standard.

This chapter and additional information in Chapter 7 fulfill those requirements.

The Act also empowers the Agency to assess and attempt to ameliorate existing racial discrimination

or disparities in rates of participation in the clean energy economy. Section 1-75(c-15)(2) directs the

Agency to commission and publish a racial disparity study to “measure[] the presence and impact of

discrimination on minority businesses and workers in Illinois’ clean energy economy.” Section 1-

75(c-20) directs the Agency to “collect data from program applicants in order to track and improve

equitable distribution of benefits across Illinois communities for all procurements the Agency

conducts.” And finally, Section 1-75(c-25) directs the Agency to work with the Department of

Commerce and Economic Opportunity to create an Energy Workforce Equity Database in order to

facilitate the engagement of Equity Eligible Contractors and persons on clean energy projects.

The opportunity to register as an Equity Eligible Contractor (“EEC”) through the Adjustable Block

Program began on December 14, 2021 and as of the August 23, 2022, filing this 2022 Long-Term

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20 ILCS 3855/1-75(c-10).

Illinois Power Agency 2022 Long-Term Plan (Final) August 23, 2022

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Plan, updated to reflect the Commission’s Final Order approving the Plan,

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three entities have

registered.

10.1. Equity Accountability System

To achieve “priority access to the clean energy economy for businesses and workers from

communities that have been excluded from economic opportunities in the energy sector, have been

subject to disproportionate levels of pollution, and have disproportionately experienced negative

public health outcomes,” the Agency will create the Equity Accountability System, which includes the

minimum equity standards for all renewable energy procurements, the equity category of the

Adjustable Block Program, and the equity prioritization for competitive procurements.

All programs and procurements will be designed to encourage participating projects to use a diverse

and equitable workforce and a diverse set of contractors, including minority-owned businesses,

disadvantaged businesses, trade unions, graduates of workforce training programs created through

Public Act 102-0662, and small businesses.

10.1.1. Minimum Equity Standards

Section 1-75(c-10)(1) of the IPA Act as established by Public Act 102-0662 requires that,

All applications for renewable energy credit procurements shall comply with specific

minimum equity commitments. Starting in the delivery year immediately following the

next long-term renewable resources procurement plan, at least 10% of the project

workforce for each entity participating in a procurement program outlined in this

subsection (c-10) must be done by equity eligible persons or equity eligible contractors.

The Agency shall increase the minimum percentage each delivery year thereafter by

increments that ensure a statewide average of 30% of the project workforce for each

entity participating in a procurement program is done by equity eligible persons or

equity eligible contractors by 2030. The Agency shall propose a schedule of percentage

increases to the minimum equity standards in its draft revised renewable energy

resources procurement plan submitted to the Commission for approval pursuant to

paragraph (5) of subsection (b) of Section 16-111.5 of the Public Utilities Act. In

determining these annual increases, the Agency shall have the discretion to establish

different minimum equity standards for different types of procurements and different

regions of the State if the Agency finds that doing so will further the purposes of this

subsection (c-10). The proposed schedule of annual increases shall be revisited and

updated on an annual basis. Revisions shall be developed with stakeholder input,

including from equity eligible persons, equity eligible contractors, clean energy industry

representatives, and community-based organizations that work with such persons and

contractors.

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Section 1-10 of the IPA Act as amended by P.A. 102-0662 defines “equity eligible persons” or “eligible

persons” as: 1) graduates or current or former participants in the Clean Jobs Workforce Network

Program, Clean Energy Contractor Incubator Program, Illinois Climate Works Preapprentice

Program, Returning Residents Clean Jobs Training Program, or the Clean Energy Primes Contractor

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See Docket No. 22-0231, Final Order dated July 14, 2022.

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Accelerator Program, and the solar training pipeline and multicultural jobs program; 2) persons who

are graduates of or currently enrolled in the foster care system; 3) persons who were formerly

incarcerated; and 4) persons whose primary residence is in an equity eligible investment community.

Section 1-10 of the IPA Act does not provide a definition for “project workforce,” which is the group

upon which the Minimum Equity Standard applies. Therefore, the IPA has developed a definition that

reflects the context and language in Sections 1-75(c-10), (c-15), (c-20), and (c-25) as well as

previously IPA-published guidance regarding required workforce reporting. For the purposes of the

Minimum Equity Standards, the IPA will define “project workforce” as the following:

“Employees, contractors and their employees, and subcontractors and their

employees, whose job duties are directly required by or substantially related to the

development, construction, and operation of a project that is participating in or

intended to participate in the IPA-administered programs and procurements under

Section 1-75(c) of the IPA Act. This shall include both project installation workforce

and workforce in administrative, sales, marketing, and technical roles where those

workers’ duties are performed in Illinois.”

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The Equity Accountability System will take effect in the first delivery year after the approval of this

Plan, which is the 2023-2024 delivery year beginning June 1, 2023. For the 2023-2024 delivery year,

the minimum equity standard therefore will be 10%. The Agency proposes to increase the minimum

equity standard to 12% for the 2024-2025 delivery year. In the next Long-Term Plan, the Agency will

propose future increases of the minimum equity standard over subsequent delivery years to

eventually reach the 30% statutory requirement by 2030. A slower initial rate of increase will

provide the solar industry time to prepare for these standards, as well as allow for workforce

development and other programs administered by the Department of Commerce and Economic

Opportunity to have time to ramp up. At this time, the Agency does not propose requiring different

minimum equity standards for different regions of the state as the Agency does not have information

on how those standards should differ by region, including the local availability of Equity Eligible

Persons and contractors. The Agency will instead evaluate the initial performance of the Equity

Accountability System in its first year to consider regional adjustments in the next Plan update that

will take place in 2023 for implementation in 2024.

For more information on the definition of Equity Eligible Persons and Equity Eligible Contractors, see

Section 7.

Compliance with the minimum equity standard entails submission of a Minimum Equity Standard

Compliance Plan, an end-of-delivery-year Minimum Equity Standard Report, and a mid-delivery-year

confirmation that the entity is on track to achieve the minimum equity standard. Submission of these

documents is mandatory and a condition for participation in relevant programs and procurements,

as discussed below.

10.1.1.1. Applicability to Noncompetitive Procurements

Section 1-75(c-10)(1) provides that “[a]ll applications for renewable energy credit procurements

shall comply with specific minimum equity commitments.” That section does not define “renewable

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This is an updated definition from the Filed Plan, as approved by the ICC in its Final Order. Docket No. 22-0231, Final Order dated July

14, 2022 at 157.

Illinois Power Agency 2022 Long-Term Plan (Final) August 23, 2022

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energy credit procurements” but does specify that the 10% minimum equity standard applies to

“each entity participating in a procurement program outlined in this subsection (c-10).” Other

requirements under this subsection are only required from “each entity participating in a

procurement program of subsection (c) of this Section,” and Section 1-75(c-30) provides that the

penalty for non-compliance with (c-10) shall be to “deny the entity's ability to participate in

procurement programs in subsection (c).” The Agency therefore interprets this section as only

applying to those renewable energy procurement programs established through Section 1-75(c) of

the Act, not to include the Illinois Solar for All Program. This interpretation is further supported by

the distinct treatment of the Illinois Solar for All Program throughout the IPA Act, including higher

REC prices, the absence of prevailing wage requirements, and dedicated funding through the

Renewable Energy Resources Fund, all of which operate to ease the burden of program participation

and maximize the access for and benefit to low-income participants. The Agency believes that the

above reading of Section 1-75(c-10) also strengthens those aims.

Other elements of the broader suite of diversity and equity provisions added to Section 1-75 of the

IPA Act through Public Act 102-0662 will apply to Illinois Solar for All, such as the data collection

obligations contained in Section 1-75(c-20) and inclusion in the studies conducted per Section 1-

75(c-15).

10.1.1.2. Applicability to Competitive Procurements

Under Section 1-75(c-10)(3) of the IPA Act, bidders in the Agency’s competitive procurements for

RECs from new utility-scale wind, solar, and brownfield site photovoltaic projects are required to

participate in the Equity Accountability System by making minimum commitments for the utilization

of Equity Eligible Persons or Equity Eligible Contractors at the applicable level for the delivery year

in which the procurement event is conducted. The commitments may be submitted in the form of

letters of intent or executed sub-contracts. If the bidder is an equity eligible person or an equity

eligible contractor, that will be considered full compliance with this requirement. Full Compliance

Plans will only be required from successful bidders as discussed below.

As discussed in Chapter 5, the Agency will prioritize bids that feature commitments to have a higher

portion of contract value flowing to Equity Eligible Contractors. This will be through an adjustment

to bid price prior to ranking of bids by price order.

10.1.1.3. Compliance Plan Filing

The Equity Accountability System will take effect at the beginning of the 2023-2024 delivery year on

June 1, 2023. By the effective date, existing Adjustable Block Program Approved Vendors and

Designees will be required to file an annual Minimum Equity Standard Compliance Plan (“Compliance

Plan”), and then after the end of the delivery year a year-end Report to demonstrate how they met

the annual minimum equity standard, as required by subparagraphs (1)(A) and (1)(C) of Section 1-

75(c-10). The Compliance Plans will reflect how the Approved Vendor or Designee plans to achieve

compliance with the minimum equity standard percentage for work completed in the upcoming

delivery year, while the Report will demonstrate how the Approved Vendor or Designee achieved

compliance with the minimum equity standard for that delivery year.

If an entity applies to be an Approved Vendor or Designee during a delivery year, the Agency will

require a Compliance Plan at the time of the initial application. For this Long-Term Plan the Agency

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will not apply different requirements for different categories of the Adjustable Block Program.

However, the Agency notes that the Equity Eligible Contractor category of the Adjustable Block

program is only available to Approved Vendors who are Equity Eligible Contractors and thus

participation in that program is the functional equivalent to full compliance with the Equity

Accountability System. Approved Vendors that are affiliated with each other may be allowed to

submit a combined Compliance Plan where they have a common parent company. The IPA will issue

guidance on how to request such permission from the Agency.

Successful bidders in competitive procurements (“Competitive Procurement Suppliers”) are

required to file a Compliance Plan within 30 days of ICC approval of their bids. Those Compliance

Plans must be consistent with commitments made during the bid registration process. A Competitive

Procurement Supplier who has previously filed a Compliance Plan due to having had prior winning

bids will be required to update their Compliance Plan.

10.1.1.4. Compliance Plan Requirements

Compliance Plans must include the following items:

i. A statement of intent to comply with equity accountability standards for the applicable

delivery year and to hire a diverse project workforce including Equity Eligible Persons

and Equity Eligible Contractors. This will include a narrative description of how the

applicant will meet these commitments.

ii. Projected number of workers and the demographic breakdown by race, gender, and

participation in job training or workforce development programs, or other means of

compliance with the standard for equity eligible persons.

iii. Plans for the use of Equity Eligible Contractors, if applicable.

iv. Applicant classification (i.e., Minority-owned, Woman-owned, Disabled-owned, Veteran-

owned, Small Business, etc.), if applicable.

v. Communication plan for local outreach to increase the utilization of Equity Eligible

Persons and Equity Eligible Contractors.

vi. Status of any corrective actions or adjustments from prior year Compliance Plans.

vii. Approved Vendors in the Adjustable Block Program do not need to report on data

regarding their Designees but shall report which Designees they worked with in the

delivery year to allow the Agency to correlate activities and compliance. This is not meant

to relieve Approved Vendors of responsibility to comply with the Equity Accountability

Standard, but rather to ensure that efforts are not double counted.

10.1.1.5. Compliance Plan Assessment

The Agency will utilize the following graduated rating system to evaluate Compliance Plans:

1) Needs Development

2) Accepted

3) Exceeds Requirements

Needs Development (a rating of 1): Indicates that the entity will need to review, correct and/or

include missing compliance items in order for the Compliance Plan to be approved. This rating

indicates the Agency has identified inconsistencies in the plan that puts the applicant at risk of non-

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compliance and the Compliance Plan will not be accepted without updating or inclusion of

requirements that need resolution or are missing.

Accepted (a rating of 2): Indicates that all compliance requirements are in place for Compliance

Plan approval, and the plan is accepted. This rating indicates the Agency has identified all necessary

components are present and the plan is operational.

Exceeds Requirements (a rating of 3): The Compliance Plan is approved. This rating indicates that

the entity has committed in their written plan to take internal, periodic checks before the mid-year

confirmation of progress to evaluate continued effectiveness or risk of the plan and will go beyond

the minimum equity standards by 50% (e.g., if the standard for a delivery year is 10%, they commit

to achieving 15%). This will include noting best practices and/or areas of adjustment.

Once the Compliance Plan Assessment review is complete, the Agency will notify the program

participant of its status to proceed or recommend areas of review for correction. A rating of at least

2 is required in order to participate.

10.1.1.6. Compliance Plan Corrections

Section 1-75(c-10)(1)(B) and (D) authorize the IPA to “offer corrective action plans to entities that

are not on track to achieve compliance”

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and “to assist them in obtaining compliance and shall

allow continued access to procurement programs upon an approved vendor or designee

demonstrating compliance.”

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After the final submission of the Approved Vendor, Designee or

Competitive Procurement Supplier’s Minimum Equity Standard Compliance Plan, the Agency will

review and accept or reject the Compliance Plan. Compliance Plans that receive a rating of 1 will be

rejected with a recommended corrective action plan. If the Agency discovers an area of the

Compliance Plan that needs to be amended or requires correction, the Agency will notify the

applicant in writing of the required correction(s) within fourteen days. The applicant will have thirty

days to submit the amended portion of the Compliance Plan. Applicants may request extensions to

that window that will be granted by the Agency on a case-by-case basis.

After resubmittal of a corrected Compliance Plan, the Agency will notify the applicant in writing of

the final re-evaluation status. The Agency will have a period not to exceed twenty-one days to notify

the program participant of final acceptance of the Compliance Plan. The Agency will accept multiple

revisions of a proposed Compliance Plan. The Agency will strive to meet the timelines listed above

but may need to extend them during times of high Compliance Plan application volumes.

10.1.1.7. Final Compliance Plan Approval

Once the Agency receives the final corrected Compliance Plan from the applicant entity and the

Agency approves the Compliance Plan, the entity will advance to the next stage of project application

or procurement. Approved Vendors, Designees, and Competitive Procurement Suppliers must meet

all minimum equity standards before being awarded a contract for RECs under an IPA program or

procurement, unless the entity has obtained a waiver. Aggregated results will be posted to the IPA

website, based on industry classification.

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20 ILCS 3855/1-75(c-10)(1)(B).

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20 ILCS 3855/1-75(c-10)(1)(D).

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Due to statutory requirements, applicants must submit a Compliance Plan at the beginning of each

delivery year and an Annual Report after the end of the delivery year for each year that they

participate in an IPA procurement; however, the Agency will reassess process efficiencies as the

program progresses.

10.1.2. Proposed Implementation Timeline

The IPA will follow the timeline below for implementation of the Minimum Equity Standard

Compliance Plan. Implementation will be divided into three phases:

1. Compliance Plan Initial Education (3

and 4

quarters 2022)

• Educational webinar to include review of Compliance Plan standards, submittals,

corrective actions, and final approval

2. Compliance Plan Training (1

quarter 2023)

• Distribution of application materials and training for applicants

3. Compliance Plan Initial Applications (2

quarter 2023)

• Applicants can begin submitting Compliance Plans prior to the June 1, 2023

launch of the Equity Accountability System requirements

10.1.3. Submittal and Reporting Process

The Agency will require each Approved Vendor, Designee, or Competitive Procurement Supplier to

confirm the Minimum Equity Standard Compliance Plan is progressing according to Agency

requirements halfway through the delivery year. That confirmation will take the form of a written

inquiry from the Agency or Program Administrator.

Each Approved Vendor, Designee, or Competitive Procurement Supplier must then submit a year-

end report within 45 days after the end of the delivery year in which they have had active

participation through activities developing a project or projects. If they have no activity during the

year, that may be indicated on the year-end report and compliance obligations will not apply. This

will correspond with the due date of the existing Annual Reports for the Adjustable Block Program.

Year-end reporting will consist of an updated version of the original Compliance Plan submitted at

the commencement of the delivery year and will include data on actual performance compared to the

information submitted in the original Compliance Plan. Reporting should also reflect any major

differences from the Minimum Equity Standard Compliance Plan such as new and innovative ways to

provide employment opportunities to low-income participants and residents within the

environmental justice communities. The first Reports will be due after the end of the 2023-2024

delivery year.

10.1.3.1. Waivers for the Minimum Equity Standard

In the event an Approved Vendor, Designee, or Competitive Procurement Supplier is unable to fulfill

the minimum equity standards for a given delivery year, Section 1-75(c-10)(1)(D) allows that entity

to seek a waiver. The Agency retains the sole discretion to grant a waiver in rare circumstances. The

Agency will grant waivers where the applicant provides evidence of significant due diligence toward

meeting the minimum equity standards. These efforts should include:

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333

i. A brief narrative describing the entity’s effort to recruit Equity Eligible Persons prior to

the start of project development. Such an effort should include utilization of the Energy

Equity Workforce Database developed by the Agency as well as the following:

a. Working consistently and assertively with approved State job training and workforce

development programs to recruit a diverse workforce and provide evidence of

outreach

b. Maintaining applications of individuals not selected for an opening for contact

regarding future project openings

c. Participating in State approved workforce training facilities for job fairs and related

local community events to recruit a diverse workforce

ii. Efforts to hire or contract with Equity Eligible Contractors should be demonstrated

through documentation from affiliated community-based organizations and/or training

program facilities, State workforce hubs, union hall registers, professional development

associations, etc. This should include the date of contact, the agency official and title of the

individual contacted.

iii. An attestation providing details of open positions or request for bids where the entity has

not received inquiries or proposals from Equity Eligible Contractors or Equity Eligible

Persons.

iv. Utilization of the Energy Workforce Equity Database.

v. Efforts to proactively establish contracting relationships with Equity Eligible Contractors.

vi. Advertising or formal solicitation using various platforms of targeted social media for no

less than thirty (30) business days. Engagement in direct and extensive outreach to

appropriately-targeted associations or other relevant organizations to notify them of the

project opportunity.

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vii. Evidence that the entity posted all project solicitations on appropriate State agency

websites, include direct targeted e-mail alerts to appropriate respondents who have

registered with State agencies to learn of opportunities.

Waivers approved for lack of Equity Eligible Persons or Equity Eligible Contractors in a geographic

area of a project shall not count against the program participant in assessment of compliance with

the minimum equity standard.

Waiver extensions or subsequent waiver requests from an applicant will need to specify efforts made

to reach compliance. Section 1-75(c-10)(4)(E) of the IPA Act directs that, “[w]hen considering

whether to grant a waiver, and to what extent, the Agency shall consider the degree to which similarly

situated applicants have been able to meet these minimum equity commitments. For repeated waiver

requests for specific lack of eligible persons or eligible contractors available, the Agency will make

recommendations to target recruitment to add such eligible persons or eligible contractors to the

[Energy Workforce Equity] database.”

The Agency will consider an assertive, sincere, and results-oriented action taken by the applicant to

comply with the minimum equity standards due diligence. The purpose of an entity demonstrating

due diligence is to promote the support of equitable access to employment on local energy solar

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In its Final Order approving the 2022 Long-Term Plan, the Commission approved the IPA’s commitment in its Response to Objections

to adjust the use of the term “minority” in this section, so as to avoid confusion between the characteristics of Equity Eligible Persons

versus the characteristics traditionally associated with “minority” populations, specifically race and ethnicity, which are not qualifying

characteristics of EEPs. See Docket No. 22-0231, Final Order dated July 14, 2022 at 159; IPA Response at 130.

Illinois Power Agency 2022 Long-Term Plan (Final) August 23, 2022

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projects, job training and apprenticeships of the residents of underserved communities throughout

the State of Illinois. In an instance where full compliance is not attainable, the Agency will accept a

written, detailed explanation of why the applicant was incapable of contracting an equity eligible

person or Equity Eligible contractor. Use of the Energy Equity Workforce Database developed by the

Agency will not alone qualify as sufficient due diligence. The program participant must provide

copies of all interactions proving such challenges and a signed attestation affirming the information

provided is truthful accurate and complete.

Given the breadth of factors at issue in a waiver assessment and the need for transparency of the

waver evaluation process, the Agency will conduct a stakeholder feedback process to design a more

detailed waiver application and assessment process. In its Final Order, the ICC directed the Agency

to assess each waiver request based upon a quantitative scoring system.

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The Agency intends for

that scoring system to include the criteria enumerated above, with each criterion earning a discrete

number of points, though it reserves the right to adjust the criteria based on stakeholder feedback

(excluding any criteria expressed in Section 1-75(c-10) directly). The stakeholder feedback process

will seek input on both the format of waiver applications and the design of the scoring system for

waiver approval. The Agency intends to hold that stakeholder process in early 2023, well before the

Minimum Equity Standard goes into effect on June 1, 2023.

Inaccuracies, fraudulent statements, or any misleading details may result in immediate

disqualification for a waiver and further disciplinary action with IPA programs. For the Delivery Year

2023-2024 the Agency will determine waivers on a case-by-case basis due to the potential that there

may only be a limited number of Equity Eligible Contractors and equity eligible persons while the

training programs created by P.A. 102-0662 are established.

10.1.4. Enforcement of Standards

If the Agency determines that an Approved Vendor, Designee, or Competitive Procurement Supplier

has failed to comply with any of the requirements set forth by the Agency, or any contract provision

set forth by the law, the Agency will notify that entity in writing within twenty-one days. At such time,

the Agency may request within twenty-one days after the notice of noncompliance any additional

reports, information and documentation that are reasonably necessary to determine program

compliance. If the requested materials are not received within twenty-one days, the Agency will

render a finding of noncompliance, and the appropriate violation status outlined below will apply.

Requests for an extension for more time to provide such additional information must be made prior

to the twenty-one day deadline and will be considered on a case-by-case basis.

The Agency will impose consequences for violations by program participants due to non-compliance,

including but not limited to:

i. Suspension of the entity’s ability to submit project applications to IPA programs or to

participate in competitive procurements during the remainder of the delivery year.

ii. Repeated violations could potentially result in the Approved Vendor or Designee

becoming suspended from the IPA’s programs for an entire delivery year. Competitive

Procurement Suppliers could likewise be barred from participation in future

competitive procurement events.

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See Docket No. 22-0231, Final Order dated July 14, 2022 at 159.

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Suspensions of an Approved Vendor or Designee in the Adjustable Block Program will be noted on

the program website’s lists of Approved Vendors and Designees as well listed on the disciplinary

actions report and in the Energy Workforce Equity Database.

10.1.5. Program Recruitment for a Diverse Workforce

The Agency will seek to collaborate with other State agencies to encourage participating entities to

utilize a diverse workforce and diverse contractors. Utilization of other State agency resources, such

as comprehensive databases, will be an option for program participants in need of support in meeting

the minimum equity standard.

Approved Vendors, Designees, and Competitive Procurement Suppliers should exercise multiple

avenues to engage eligible persons, where applicable:

i. Workshops to educate the local eligible workforce on industry particulars

ii. Offering potential job-shadowing to clean energy program students through DCEO

workforce hubs, and focusing efforts on targeted audiences

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iii. Utilization of the Energy Workforce Equity Database

iv. Job fairs for appropriate screening of potential candidates

v. Accessing untapped local labor pools (i.e., trade schools, community colleges)

vi. Developing tailored training programs to accommodate pre-employment training (i.e.,

life skills, financial management)

vii. Special funding for dislocated workers to expand service capability and/or training for

project work

viii. Supporting training and employment retention by connecting with community-based

organizations for proper wrap around services such as: childcare assistance,

transportation, and mentor check-ins

ix. Providing support to persons or entities who apply for state and federal workforce

programs or assistance related to clean energy

10.1.6. Modifications to the Equity Accountability System

Section 1-75(c-10)(7) provides that, “[a]s part of the update of the long-term renewable resources

procurement plan to be initiated in 2023, or sooner if the Agency deems necessary, the Agency shall

determine the extent to which the equity accountability system… has advanced the goals [codified in

P.A. 102-0662] including through the inclusion of equity eligible persons and equity eligible

contractors in renewable energy credit projects.”

If the Agency determines that the equity accountability system has not fully achieved those goals to

its fullest potential, Section 1-75(c-10)(7) provides that the Agency may revise the following criteria:

i. [T]he percentage of project workforce, or other appropriate workforce measure, certified

as equity eligible persons or equity eligible contractors

ii. [T]he definitions for equity investment eligible persons and equity investment eligible

community

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In its Final Order approving the 2022 Long-Term Plan, the Commission approved the IPA’s commitment in its Response to Objections

to adjust the use of the term “minority” in this section, so as to avoid confusion between the characteristics of Equity Eligible Persons

versus the characteristics traditionally associated with “minority” populations, specifically race and ethnicity, which are not qualifying

characteristics of EEPs. See Docket No. 22-0231, Final Order dated July 14, 2022 at 159; IPA Response at 130.

Illinois Power Agency 2022 Long-Term Plan (Final) August 23, 2022

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iii. [O]ther modifications deemed necessary to advance the goals of [Public Act 102-0662]. Such

revised criteria may also establish distinct equity accountability systems for different types

of procurements or different regions of the State if the Agency finds that doing so will further

the purposes of such programs.

Revisions will be developed with stakeholder input, including from Equity Eligible Persons, Equity

Eligible Contractors, and community-based organizations that work with such persons and

contractors.

10.2. Equity Accountability System Assessment and Racial Disparity Study

Section 1-75(c-15) of the IPA Act as amended by Public Act 102-0662 requires the Agency to conduct

analysis of the effectiveness of the equity accountability system in increasing participation of Equity

Eligible Persons and Equity Eligible Contractors. The Agency must conduct this analysis within one

year of awarding the first contracts that resulted from the implementation of the equity

accountability system.

After that initial assessment of the equity accountability system, Section 1-75(c-15)(2)(B) of the IPA

Act requires that the Agency commission a study to “measure the presence and impact of

discrimination on minority businesses and workers in Illinois' clean energy economy,” including

activity outside of IPA programs, utilizing consultants and subject matter experts. The study will

review the State’s renewable energy sector regarding access, participation, and utilization of

contractors, with a special emphasis on minority-owned business enterprises and

minority/disadvantaged workers, with the goal of analyzing whether race or gender has been a

barrier to equitable access for all business owners and workers.

Section 1-75(c-15)(2)(B) of the IPA Act expressly exempts the selection of a consultant to conduct

this study from the bidding requirements contained in Section 20-10 of the Illinois Procurement

Code. Like other selection processes for consultants conducted by the Agency that are exempt from

those requirements (e.g., Procurement Administrators, Procurement Planning Consultants, and

Program Administrators), this process will be conducted in two parts consisting of an initial Request

for Qualifications and a subsequent Request for Proposals issued to qualified respondents to the

Request for Qualifications. The Agency will also consult relevant professionals experienced with the

use and design of disparity studies and the legal considerations of race-conscience remedies prior to

the selection of a consultant and will endeavor to have the consultant selected by June 1, 2023. This

will allow the consultant to be in place at the time of the launch of the Equity Accountability System

which will be a critical data input into the study.

10.2.1. Timing of Equity Accountability System Assessment and Racial

Disparity Study

Section 1-75(c-15)(2)(A) sets the timeline for publishing the assessment findings to be within one

year after contracts are awarded under the equity accountability system. The system launches June

1, 2023 and there will be some lag between that date and the first contracts awarded. Therefore, the

Agency aims to publish the initial study by August 1, 2024. The Agency will publish the findings of

all research listed above, along with recommendations made to the Agency regarding inclusion of

minority and disadvantaged businesses in the procurement process. The report will display

participating workers and contractors by race and ethnicity, with all data anonymized.

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Section 1-75(c-15)(2)(B) provides that the Agency shall commission the disparity study “as soon as

is practicable” after publishing the assessment of the equity accountability system. The Agency will

work with DCEO to develop a timeline for commissioning this study.

10.2.2. Scope of Equity Accountability System Assessment and Racial

Disparity Study

The methodology used to assist the Agency with assessing the efficacy of the equity accountability

system will include, but will not be limited to, the following:

i. Analysis of data collected by the Agency through its programs, procurements, and Equity

Accountability System

ii. Interviews with area and regional businesses

iii. Community outreach to include townhall meetings, email correspondence, and public

hearings open to the public for transparency

iv. Focused assembly of randomly chosen EEC business owners to articulate their experiences

in doing business in the industry with the State of Illinois

The methodology of the disparity study will be determined by the consulting firm retained by the

Agency to conduct the study.

10.2.3. Coordination with Other Agencies

The Agency will collaborate closely with the Department of Commerce and Economic Opportunity,

Department of Labor, Department of Corrections, and other appropriate agencies to commission the

racial disparity study. The primary objective of inter-agency coordination will be to develop actions

to effectively address discriminatory practices or trends in the clean energy sector in Illinois.

10.2.4. Entity Participation

A critical element of a successful disparity study is a representative set of data to obtain a true

reflection of the state of inequitable practices and procedures. Specifically, minority-owned business

and worker participation would provide valuable insight to the efficacy and challenges in the

Agency’s efforts to increase inclusion and may highlight previously unknown barriers to

participation. Substantive input from diverse entities will inform changes to policies, procedures, and

procurements going forward.

The Agency will collaborate with the entity contracted to conduct the disparity study to create

scheduled public workshops to collect stakeholder input. Entities not comfortable sharing

experiences in a public setting or unable to attend will have the option of sharing experiences via

written communication.

As discussed above, the Agency sets a tentative completion and publication date for the study of

August 1, 2024. The tentative date will be subject to change according to Agency response to future

statutory requirements.

10.3. Program Data Collection

Section 1-75(c-20) acknowledges that “data collection, data analysis, and reporting are critical to

ensure that the benefits of the clean energy economy provided to Illinois residents and businesses

are equitably distributed across the State,” and for “track[ing] and improv[ing] equitable distribution

Illinois Power Agency 2022 Long-Term Plan (Final) August 23, 2022

338

of benefits across Illinois communities.” It directs the Agency to collect certain data from all entities

participating in Agency programs so that the Agency may monitor the progress in advancing access

to and participation in renewable energy incentive programs by diverse businesses and residents.

The Agency will collect demographic and geographic data for each entity awarded contracts under

any Agency-administered program:

i. Demographic information, including racial or ethnic identity for real persons employed,

contracted, or subcontracted through the program and owners of businesses or entities

that receive contracts through Agency programs or procurements

ii. Geographic location of the residency of real persons employed, contracted, or

subcontracted through the program and geographic location of the headquarters of the

business or entity is awarded a contract through an Agency program or procurement; and

iii. Any other information the Agency determines is necessary for the purpose of achieving

the purpose of this subsection.

The Agency will provide stakeholders the opportunity to review proposals and provide feedback

before any new information requirements are implemented. As required by Section 1-75(c-20)(4),

the Agency will “publish … annually, information on the demographics of program participants on an

aggregate basis.”

10.4.

Energy Workforce Equity Database

Section 1-75(c-25) requires that the Agency develop an Energy Workforce Equity Database. As of the

filing this final 2022 Long-Term Plan, which has been updated to reflect the Commission’s Final Order

approving the Plan, the Agency is collaborating with other state agencies to expedite the

development of this tool.

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This online resource will allow users to view the participating businesses

in the renewable energy industry of Illinois. Participating entities will have additional responsibility

for compiling and submitting relevant information on Equity Eligible Contractors and Equity Eligible

Persons.

Section 1-75(c-25)(1) of the IPA Act states that:

The Energy Workforce Equity Database shall be a searchable database of suppliers,

vendors, and subcontractors for clean energy industries that is:

(A) publicly accessible

(B) easy for people to find and use

(D) region-specific and

(E) populated with information including, but not limited to, contacts for suppliers,

vendors, or subcontractors who are minority and women-owned business enterprise

certified or who participate or have participated in any of the programs described in

this Act.

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In the event of a selection of an outside contractor to conduct the web design, such selection would be exempt from the bid selection

process requirements of Section 20-10 of the Illinois Procurement Code.

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Sections 1-75(c-25)(2) and (3) further specifies that:

(2) The Agency shall create an easily accessible, public facing online tool using the

database information that includes, at a minimum, the following:

(A) a map of environmental justice and equity investment eligible communities

(B) job postings and recruiting opportunities

with current or former participants of clean energy workforce training

programs

(D) information on workforce training service providers and training

opportunities available to prospective workers

(E) renewable energy company diversity reporting

(F) a list of equity eligible contractors with their contact information, types of

work performed, and locations worked in

(G) reporting on outcomes of the programs described in the workforce

programs of the Energy Transition Act, including information such as, but not

limited to, retention rate, graduation rate, and placement rates of trainees; and

(H) information about the Jobs and Environmental Justice Grant Program, the

Clean Energy Jobs and Justice Fund, and other sources of capital.

(3) The Agency shall ensure the database is regularly updated to ensure

information is current and shall coordinate with the Department of Commerce and

Economic Opportunity to ensure that it includes information on individuals and

entities that are or have participated in the Clean Jobs Workforce Network Program,

Clean Energy Contractor Incubator Program, Returning Residents Clean Jobs

Training Program, or Clean Energy Primes Contractor Accelerator Program.

The Database will enable individuals to register as Equity Eligible Persons and seek job opportunities

and will allow for those individuals to identify themselves as Qualified Persons for purposes of

renewable energy installation.

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The Agency notes that while some of the information required for the database already exists (e.g.,

maps of environmental justice communities), many other data sources do not yet exist. For example,

the new workforce development and grant programs administered by the Department of Commerce

and Economic Opportunity are still under development. For this reason, the Agency is planning a

phased rollout of the Energy Equity Workforce Database.

The Agency expects that Phase 1 of the Energy Equity Workforce Database will be launched by late

2022. Phase 2 will begin 1

quarter 2023, in conjunction with the Department of Commerce and

Economic Opportunity, and include information required by items D through H of Section 1-75(c-

25(2).

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See Docket No. 22-0231, Final Order dated July 14, 2022 at 160.