PEAKER Act of 2021

I 117TH CONGRESS 1ST SESSION H. R. 3139 To require the Secretary of Energy to submit to Congress an annual report on peaker plants in the United States and to provide financial incentives for replacing peaker plants with technology that receives, stores, and delivers energy generated by renewable energy resources, and for other purposes. IN THE HOUSE OF REPRESENTATIVES MAY 12, 2021 Ms. CLARKE of New York (for herself, Mr. TORRES of New York, Ms. VELA´ZQUEZ, Mr. NADLER, Ms. BARRAGA´N, Ms. NORTON, Mr. ESPAILLAT, Ms. LEE of California, Ms. WILLIAMS of Georgia, Mr. JONES, and Mr. SOTO) introduced the following bill; which was referred to the Committee on Energy and Commerce, and in addition to the Com- mittee on Ways and Means, for a period to be subsequently determined by the Speaker, in each case for consideration of such provisions as fall within the jurisdiction of the committee concerned A BILL To require the Secretary of Energy to submit to Congress an annual report on peaker plants in the United States and to provide financial incentives for replacing peaker plants with technology that receives, stores, and delivers energy generated by renewable energy resources, and for other purposes. Be it enacted by the Senate and House of Representa- 1 tives of the United States of America in Congress assembled, 2 VerDate Sep 11 2014 00:39 Jun 12, 2021 Jkt 019200 PO 00000 Frm 00001 Fmt 6652 Sfmt 6201 E:\BILLS\H3139.IH H3139 kjohnson on DSK79L0C42PROD with BILLS 2 •HR 3139 IH SECTION 1. SHORT TITLE. 1 This Act may be cited as the ‘‘Promoting Energy Al- 2 ternatives is Key to Emission Reductions Act of 2021’’ 3 or the ‘‘PEAKER Act of 2021’’. 4 SEC. 2. DEFINITIONS. 5 In this Act: 6 (1) APPROPRIATE COMMITTEES OF CON- 7 GRESS.—The term ‘‘appropriate committees of Con- 8 gress’’ means— 9 (A) the Committee on Finance of the Sen- 10 ate; 11 (B) the Committee on Energy and Natural 12 Resources of the Senate; 13 (C) the Committee on Environment and 14 Public Works of the Senate; 15 (D) the Committee on Ways and Means of 16 the House of Representatives; and 17 (E) the Committee on Energy and Com- 18 merce of the House of Representatives. 19 (2) DISADVANTAGED COMMUNITY.—The term 20 ‘‘disadvantaged community’’ means a community 21 that— 22 (A) is located in an area with a high con- 23 centration of individuals who— 24 (i) are members of low- and moderate- 25 income households (as defined in section 26 VerDate Sep 11 2014 00:39 Jun 12, 2021 Jkt 019200 PO 00000 Frm 00002 Fmt 6652 Sfmt 6201 E:\BILLS\H3139.IH H3139 kjohnson on DSK79L0C42PROD with BILLS 3 •HR 3139 IH 570.3 of title 24, Code of Federal Regula- 1 tions (or a successor regulation)); 2 (ii) experience high levels of unem- 3 ployment; 4 (iii) face a high rent burden; 5 (iv) face a high energy burden; 6 (v) have low levels of home ownership; 7 (vi) have low levels of educational at- 8 tainment; or 9 (vii) are members of groups that have 10 historically experienced discrimination on 11 the basis of race or ethnicity; 12 (B) is burdened by high cumulative envi- 13 ronmental pollution or other hazards that can 14 lead to negative public health effects; or 15 (C) is determined to be a disadvantaged 16 community, an environmental justice commu- 17 nity, a climate-burdened community, or an oth- 18 erwise similarly vulnerable community pursuant 19 to any Federal or State-level initiative, includ- 20 ing any relevant mapping initiative. 21 (3) HIGH ENERGY BURDEN.—The term ‘‘high 22 energy burden’’ means, with respect to a household, 23 expenditure of the household on residential energy 24 VerDate Sep 11 2014 00:39 Jun 12, 2021 Jkt 019200 PO 00000 Frm 00003 Fmt 6652 Sfmt 6201 E:\BILLS\H3139.IH H3139 kjohnson on DSK79L0C42PROD with BILLS 4 •HR 3139 IH costs that equals 6 percent or more of the household 1 income. 2 (4) PEAKER PLANT.—The term ‘‘peaker plant’’ 3 means a fossil fuel-fired power plant or unit of a 4 power plant that is run primarily to meet peak elec- 5 tricity demand, as determined by the Secretary, in 6 coordination with the Administrator of the Environ- 7 mental Protection Agency and the applicable local 8 electrical grid operator. 9 (5) SECRETARY.—The term ‘‘Secretary’’ means 10 the Secretary of Energy. 11 SEC. 3. ANNUAL REPORT ON PEAKER PLANTS IN THE 12 UNITED STATES. 13 (a) IN GENERAL.—Not later than 180 days after the 14 date of enactment of this Act, and annually thereafter, 15 the Secretary, in coordination with the Administrator of 16 the Environmental Protection Agency, the White House 17 Environmental Justice Advisory Council, the White House 18 Environmental Justice Interagency Council, the Council 19 on Environmental Quality, and any other relevant Federal 20 entity that the Secretary determines to be appropriate, 21 shall submit to the appropriate committees of Congress 22 a report that— 23 (1) identifies each peaker plant in the United 24 States; and 25 VerDate Sep 11 2014 00:39 Jun 12, 2021 Jkt 019200 PO 00000 Frm 00004 Fmt 6652 Sfmt 6201 E:\BILLS\H3139.IH H3139 kjohnson on DSK79L0C42PROD with BILLS 5 •HR 3139 IH (2) for each peaker plant identified under para- 1 graph (1)— 2 (A) describes the location of the peaker 3 plant and related socioeconomic and demo- 4 graphic data for that location, including wheth- 5 er the peaker plant is located in or adjacent to 6 a disadvantaged community; 7 (B) evaluates the quantity of carbon diox- 8 ide, nitric oxides, sulfur oxides, fine particulate 9 matter (PM2.5), and methane emitted per unit 10 of electricity generated by the peaker plant; 11 (C) identifies— 12 (i) the total number of hours that the 13 peaker plant generates electricity during 14 the year covered by the report; 15 (ii) the capacity factor of the plant; 16 (iii) the average number of hours that 17 the peaker plant generates electricity each 18 time that the peaker plant generates elec- 19 tricity; and 20 (iv) the percentage of the total num- 21 ber of instances in which the peaker plant 22 is started that result in the peaker plant 23 generating electricity for— 24 (I) not less than 4 hours; 25 VerDate Sep 11 2014 00:39 Jun 12, 2021 Jkt 019200 PO 00000 Frm 00005 Fmt 6652 Sfmt 6201 E:\BILLS\H3139.IH H3139 kjohnson on DSK79L0C42PROD with BILLS 6 •HR 3139 IH (II) not less than 8 hours; and 1 (III) not less than 12 hours; and 2 (D) identifies, for each day on which the 3 3 air monitors closest to the peaker plant indicate 4 that Federal ozone or particulate matter stand- 5 ards have been exceeded, the percentage of peak 6 demand met by the peaker plant for the elec- 7 trical grid load zone served by the peaker plant. 8 (b) COMMUNITY ENGAGEMENT.—In preparing a re- 9 port under subsection (a), the Secretary shall initiate and 10 carry out public engagement with residents and stake- 11 holders from disadvantaged communities containing a 12 peaker plant. 13 SEC. 4. CREDIT FOR GENERATION AND STORAGE OF EN- 14 ERGY FROM RENEWABLE SOURCES. 15 (a) IN GENERAL.—Subpart E of part IV of sub- 16 chapter A of chapter 1 of the Internal Revenue Code of 17 1986 is amended by inserting after section 48C the fol- 18 lowing new section: 19 ‘‘SEC. 48D. RENEWABLE ENERGY GENERATION AND STOR- 20 AGE CREDIT. 21 ‘‘(a) IN GENERAL.—For purposes of section 46, the 22 renewable energy generation and storage credit for any 23 taxable year is an amount equal to 10 percent of the quali- 24 VerDate Sep 11 2014 00:39 Jun 12, 2021 Jkt 019200 PO 00000 Frm 00006 Fmt 6652 Sfmt 6201 E:\BILLS\H3139.IH H3139 kjohnson on DSK79L0C42PROD with BILLS 7 •HR 3139 IH fied investment for such taxable year with respect to any 1 qualified renewable energy facility. 2 ‘‘(b) QUALIFIED INVESTMENT WITH RESPECT TO 3 QUALIFIED RENEWABLE ENERGY FACILITIES.— 4 ‘‘(1) IN GENERAL.—For purposes of subsection 5 (a), the qualified investment with respect to a quali- 6 fied renewable energy facility for any taxable year is 7 the basis of any qualified property placed in service 8 by the taxpayer during such taxable year which is 9 part of a qualified renewable energy facility. 10 ‘‘(2) QUALIFIED PROPERTY.—For purposes of 11 this subsection, the term ‘qualified property’ means 12 property— 13 ‘‘(A) which is— 14 ‘‘(i) tangible personal property, or 15 ‘‘(ii) other tangible property (not in- 16 cluding a building or its structural compo- 17 nents), but only if such property is used as 18 an integral part of the qualified renewable 19 energy facility, 20 ‘‘(B) with respect to which depreciation (or 21 amortization in lieu of depreciation) is allow- 22 able, 23 VerDate Sep 11 2014 00:39 Jun 12, 2021 Jkt 019200 PO 00000 Frm 00007 Fmt 6652 Sfmt 6201 E:\BILLS\H3139.IH H3139 kjohnson on DSK79L0C42PROD with BILLS 8 •HR 3139 IH ‘‘(C) which is constructed, reconstructed, 1 erected, installed, or acquired by the taxpayer, 2 and 3 ‘‘(D) the original use of which commences 4 with the taxpayer. 5 ‘‘(3) QUALIFIED RENEWABLE ENERGY FACIL- 6 ITY.— 7 ‘‘(A) IN GENERAL.—Subject to subpara- 8 graph (B), the term ‘qualified renewable energy 9 facility’ means a facility which— 10 ‘‘(i) uses solar, wind, low-impact hy- 11 droelectric (as certified by the Low Impact 12 Hydropower Institute), geothermal, tidal, 13 or wave energy to generate electricity 14 which will be received and stored by prop- 15 erty described in clause (ii), 16 ‘‘(ii) contains property which receives, 17 stores, and delivers electricity described in 18 clause (i), provided that such electricity 19 is— 20 ‘‘(I)(aa) sold by the taxpayer to 21 an unrelated person, or 22 ‘‘(bb) in the case of a facility 23 which is equipped with a metering de- 24 vice which is owned and operated by 25 VerDate Sep 11 2014 00:39 Jun 12, 2021 Jkt 019200 PO 00000 Frm 00008 Fmt 6652 Sfmt 6201 E:\BILLS\H3139.IH H3139 kjohnson on DSK79L0C42PROD with BILLS 9 •HR 3139 IH an unrelated person, sold or consumed 1 by the taxpayer, and 2 ‘‘(II) at a minimum, discharged 3 at such times as a peaker plant within 4 the same electrical grid load zone 5 would operate to meet peak electricity 6 demand (as determined by the grid 7 operator for such electrical grid), and 8 ‘‘(iii) which is placed in service— 9 ‘‘(I) in a disadvantaged commu- 10 nity which is located within— 11 ‘‘(aa) the same census tract 12 as a peaker plant, or 13 ‘‘(bb) a census tract that is 14 adjacent to a census tract in 15 which a peaker plant is located, 16 and 17 ‘‘(II) after December 31, 2021. 18 ‘‘(B) SPECIAL RULE.—For purposes of 19 this paragraph, a facility shall not be deemed to 20 be a qualified renewable energy facility unless 21 the taxpayer demonstrates, to the satisfaction 22 of the Secretary, that— 23 ‘‘(i) the property described in clause 24 (i) of subparagraph (A) is co-located with 25 VerDate Sep 11 2014 00:39 Jun 12, 2021 Jkt 019200 PO 00000 Frm 00009 Fmt 6652 Sfmt 6201 E:\BILLS\H3139.IH H3139 kjohnson on DSK79L0C42PROD with BILLS 10 •HR 3139 IH property described in clause (ii) of such 1 subparagraph, 2 ‘‘(ii) such taxpayer has, with respect 3 to the property described in clause (ii) of 4 such subparagraph, entered into a contract 5 which ensures that such property operates 6 primarily to receive, store, and deliver elec- 7 tricity from any property described in 8 clause (i) of such subparagraph, or 9 ‘‘(iii) the property described in clause 10 (ii) of such subparagraph receives elec- 11 tricity during periods of typically high pro- 12 duction of electricity, as a percentage of 13 the grid generation mix, from sources de- 14 scribed in clause (i) of such subparagraph, 15 as determined by the grid operator for the 16 electrical grid. 17 ‘‘(c) CERTAIN PROGRESS EXPENDITURE RULES 18 MADE APPLICABLE.—Rules similar to the rules of sub- 19 sections (c)(4) and (d) of section 46 (as in effect on the 20 day before the date of the enactment of the Revenue Rec- 21 onciliation Act of 1990) shall apply for purposes of sub- 22 section (a). 23 VerDate Sep 11 2014 00:39 Jun 12, 2021 Jkt 019200 PO 00000 Frm 00010 Fmt 6652 Sfmt 6201 E:\BILLS\H3139.IH H3139 kjohnson on DSK79L0C42PROD with BILLS 11 •HR 3139 IH ‘‘(d) DEFINITIONS.—The terms ‘disadvantaged com- 1 munity’ and ‘peaker plant’ have the same meanings given 2 such term under section 2 of the PEAKER Act of 2021.’’. 3 (b) CONFORMING AMENDMENTS.— 4 (1) Section 46 of the Internal Revenue Code of 5 1986 is amended— 6 (A) by striking ‘‘and’’ at the end of para- 7 graph (5), 8 (B) by striking the period at the end of 9 paragraph (6) and inserting ‘‘, and’’, and 10 (C) by adding at the end the following new 11 paragraph: 12 ‘‘(7) the renewable energy generation and stor- 13 age credit.’’. 14 (2) Section 49(a)(1)(C) of such Code is amend- 15 ed— 16 (A) by striking ‘‘and’’ at the end of clause 17 (iv), 18 (B) by striking the period at the end of 19 clause (v) and inserting ‘‘, and’’, and 20 (C) by adding at the end the following new 21 clause: 22 ‘‘(vi) the basis of any qualified prop- 23 erty which is part of a qualified renewable 24 energy facility under section 48D.’’. 25 VerDate Sep 11 2014 00:39 Jun 12, 2021 Jkt 019200 PO 00000 Frm 00011 Fmt 6652 Sfmt 6201 E:\BILLS\H3139.IH H3139 kjohnson on DSK79L0C42PROD with BILLS 12 •HR 3139 IH (3) Section 50(a)(2)(E) of such Code is amend- 1 ed by striking ‘‘or 48C(b)(2)’’ and inserting 2 ‘‘48C(b)(2), or 48D(c)’’. 3 (4) The table of sections for subpart E of part 4 IV of subchapter A of chapter 1 of such Code is 5 amended by inserting after the item relating to sec- 6 tion 48C the following new item: 7 ‘‘48D. Renewable energy generation and storage credit.’’. (c) EFFECTIVE DATE.—The amendments made by 8 this subsection shall apply to property placed in service 9 after December 31, 2020, under rules similar to the rules 10 of section 48(m) of the Internal Revenue Code of 1986 11 (as in effect on the day before the date of the enactment 12 of the Revenue Reconciliation Act of 1990). 13 SEC. 5. RENEWABLE ENERGY GRANT PROGRAM. 14 (a) DEFINITIONS.—In this section: 15 (1) ELIGIBLE ENTITY.—The term ‘‘eligible enti- 16 ty’’ means each of the following: 17 (A) A unit of State or local government. 18 (B) A tax-exempt nonprofit organization. 19 (C) A community-owned energy generation 20 facility or energy storage facility located in a 21 disadvantaged community. 22 (D) A community-based energy cooperative 23 or a similar group of individuals within a com- 24 VerDate Sep 11 2014 00:39 Jun 12, 2021 Jkt 019200 PO 00000 Frm 00012 Fmt 6652 Sfmt 6201 E:\BILLS\H3139.IH H3139 kjohnson on DSK79L0C42PROD with BILLS 13 •HR 3139 IH munity who are pursuing an eligible project de- 1 scribed in subsection (d). 2 (E) A partnership between— 3 (i) 1 or more of the entities described 4 in subparagraphs (A) through (D); and 5 (ii)(I) an electric utility; or 6 (II) a private entity. 7 (2) ENERGY STORAGE FACILITY.—The term 8 [Text truncated for display. Full text available on Congress.gov.]