10 C.F.R. PART 451—RENEWABLE ENERGY PRODUCTION INCENTIVES
Title 10 - Energy
Authority: 42 U.S.C. 7101, et seq.; 42 U.S.C. 13317.
Source: 60 FR 36964, July 19, 1995, unless otherwise noted.
(a) The provisions of this part cover the policies and procedures applicable to the determinations by the Department of Energy (DOE) to make incentive payments, under the authority of 42 U.S.C. 13317, for electric energy generated and sold by a qualified renewable energy facility owned by a State or political subdivision thereof; a not-for-profit electric cooperative; a public utility described in section 115 of the Internal Revenue Code of 1986; an Indian tribal government or subdivision thereof; or a Native corporation. (b) Determinations to make incentive payments under this part are not subject to the provisions of 10 CFR part 600 and such payments shall not be construed to be financial assistance. [60 FR 36964, July 19, 1995, as amended at 71 FR 46386, Aug. 14, 2006] As used in this part— Biomass means biologically generated energy sources such as heat derived from combustion of plant matter, or from combustion of gases or liquids derived from plant matter, animal wastes, or sewage, or from combustion of gases derived from landfills, or hydrogen derived from these same sources. Closed-loop biomass means any organic material from a plant which is planted exclusively for purposes of being used at a qualified renewable energy facility to generate electricity. Date of first use means, at the option of the facility owner, the date of the first kilowatt-hour sale, the date of completion of facility equipment testing, or the date when all approved permits required for facility construction are received. Deciding Official means the Manager of the Golden Field Office of the Department of Energy (or any DOE official to whom the authority of the Manager of the Golden Field Office may be redelegated by the Secretary of Energy). DOE means the Department of Energy. Finance Office means the DOE Office of the Chief Financial Officer (or any office to which that Office's authority may be redelegated by the Secretary of Energy). Fiscal year means the Federal fiscal year beginning October 1 and ending on September 30 of the following calendar year. Indian tribal government means the governing body of an Indian tribe as defined in section 4 of the Indian Self-Determination and Education Assistance Act (25 U.S.C. 450b). Native corporation has the meaning set forth in the Alaska Native Claims Settlement Act (25 U.S.C. 1602). Net electric energy means the metered kilowatt-hours (kWh) generated and sold, and excludes electric energy used within the renewable energy facility to power equipment such as pumps, motors, controls, lighting, heating, cooling, and other systems needed to operate the facility. Not-for-profit electrical cooperative means a cooperative association that is legally obligated to operate on a not-for-profit basis and is organized under the laws of any State for the purpose of providing electric service to its members. Ocean means the waters of the Atlantic Ocean (including the Gulf of Mexico) and the Pacific Ocean within the jurisdiction of the United States from which energy may be derived through application of tides, waves, currents, thermal differences, or other means. Renewable energy facility means a single module or unit, or an aggregation of such units, that generates electric energy which is independently metered and which results from the utilization of a renewable energy source. Renewable energy source means solar heat, solar light, wind, ocean, geothermal heat, and biomass, except for— (1) Heat from the burning of municipal solid waste; or (2) Heat from a dry steam geothermal reservoir which— (i) Has no mobile liquid in its natural state; (ii) Is a fluid composed of at least 95 percent water vapor; and (iii) Has an enthalpy for the total produced fluid greater than or equal to 2.791 megajoules per kilogram (1200 British thermal units per pound). State means the District of Columbia, Puerto Rico, and any of the States, Commonwealths, territories, and possessions of the United States. [60 FR 36964, July 19, 1995, as amended at 71 FR 46386, Aug. 14, 2006] Any owner, or operator with the written consent of the owner, but not both, of a qualified renewable energy facility, may apply for incentive payments for net electric energy generated from a renewable energy source and sold. In order to qualify for an incentive payment under this part, a renewable energy facility must meet the following qualifications— (a) Owner qualifications. The owner must be— (1) A State or a political subdivision of a State (or agency, authority, or instrumentality thereof); (2) A public utility described in section 115 of the Internal Revenue Code of 1986; (3) A not-for-profit electrical cooperative; (4) An Indian tribal government or subdivision thereof; or (5) A Native corporation. (b) What constitutes ownership. The owner must have all rights to the beneficial use of the renewable energy facility, and legal title must be held by, or for the benefit of, the owner. (c) Sales affecting interstate commerce. The net electric energy generated by the renewable energy facility must be sold to another entity for consideration. (d) Type of renewable energy sources. The source of the electric energy for which an incentive payment is sought must be a renewable energy source, as defined in §451.2. (e) Time of first use. The date of the first use of a newly constructed renewable energy facility, or a facility covered by paragraph (f) of this section, must occur during the inclusive period beginning October 1, 1993, and ending on September 30, 2016. For facilities whose date of first use occurred in the period October 1, 2003, through September 30, 2004, the time of first use shall be deemed to be October 1, 2004. (f) Conversion of non-qualified facilities. Existing non-qualified facilities that are converted must meet either of the following criteria— (1) A facility employing solar, wind ocean, geothermal or biomass sources must be refurbished during the allowed time of first use such that the fair market value of any previously used property does not exceed 20% of the facility's total value. (2) A facility not employing solar, wind ocean, geothermal or biomass sources must be converted in part or in whole to a qualified facility during the allowed time of first use. (g) Location. The qualified renewable energy facility must be located in a State or in U.S. jurisdictional waters. [60 FR 36964, July 19, 1995, as amended at 71 FR 46386, Aug. 14, 2006] (a) Pre-application and notification. (1) An applicant may submit at any time a pre-application, containing the information described in §451.8 (a) through (e), to obtain a preliminary and conditional determination of eligibility. (2) To assist DOE in its budget planning, the owner or operator of a qualified renewable energy facility is requested to provide notification at least 6 months in advance of when a facility is expected to be first used, providing projected information specified in §451.8 (a) through (e). (b) Application. (1) An application for an incentive payment for electric energy generated and sold in a fiscal year must be filed during the first quarter (October 1 through December 31) of the next fiscal year, except as provided in paragraph (b)(2) of this section. (2) For facilities whose date of first use occurred in the period October 1, 2003, through September 30, 2005, applications for incentive payments for electric energy generated and sold in fiscal year 2005 must be filed by August 31, 2006. (3) Failure to file an application in any fiscal year for payment for energy generated in the preceding fiscal year shall disqualify the owner or operator from eligibility for any incentive payment for energy generated in that preceding fiscal year. (c) Where. Applications and notifications to the Department shall be submitted to the Renewable Energy Production Incentive Program, U.S. Department of Energy, Golden Field Office, 1617 Cole Boulevard, Golden, CO, 80401. [60 FR 36964, July 19, 1995, as amended at 71 FR 46387, Aug. 14, 2006] Subject to the availability of appropriated funds, DOE shall make incentive payments under this part with respect to a qualified renewable energy facility for 10 consecutive fiscal years. Such period shall begin with the fiscal year in which application for payment for electricity generated by the facility is first made and the facility is determined by DOE to be eligible for receipt of an incentive payment. The period for payment under this program ends with fiscal year 2026. [60 FR 36964, July 19, 1995, as amended at 71 FR 46387, Aug. 14, 2006] The net electric energy generated and sold (kilowatt-hours) by the owner or operator of a qualified renewable energy facility must be measured by a standard metering device that— (a) Meets generally accepted industry standards; (b) Is maintained in proper working order according to the instructions of its manufacturer; and (c) Is calibrated according to generally accepted industry standards. An application for an incentive payment under this part must be signed by an authorized executive official and shall provide the following information— (a) A statement indicating that the applicant is the owner of the facility or is the operator of the facility and has the written consent of an authorized executive official of the owner to file an application; (b) The name of the facility or other official designation; (c) The location and address of the facility and type of renewable energy source; (d) The name, address, and telephone number of a point of contact to respond to questions or requests for additional information; (e) A clear statement of how the application satisfies each and every part of the eligibility criteria under §451.4; (f) A statement of the annual and monthly metered net electric energy generated and sold during the prior fiscal year by the qualified renewable energy facility, measured in kilowatt-hours, for which an incentive payment is requested; (g) In the case of a qualified renewable energy facility which generates electric energy using a fossil fuel, nuclear energy, or other non-qualified energy source in addition to using a renewable energy source, a statement of the net electric energy generated, measured in kilowatt-hours, attributable to the renewable energy source, including a calculation showing the total monthly and annual kilowatt-hours generated and sold during the fiscal year multiplied by a fraction consisting of the heat input, as measured in appropriate energy units, received by the working fluid from the renewable energy sources divided by the heat input, as measured in the same energy units, received by the working fluid from all energy sources; (h) The total amount of electric energy for which payment is requested, including the net electric energy generated in the prior fiscal year, as determined according to paragraph (f) or (g) of this section; (i) Copies of permit authorizations if the date of first use is based on permit approvals and this is the initial application; (j) Instructions for payment by electronic funds transfer; (k) A statement agreeing to retain records for a period of three (3) years which substantiate the annual and monthly metered number of kilowatt-hours generated and sold, and to provide access to, or copies of, such records within 30 days of a written request by DOE; and (l) A statement signed by an authorized executive official certifying that the information contained in the application is accurate. (m) If a not–for–profit electric cooperative, a statement certifying that no claim for tax credit has been made for the same electricity for which incentive payments are requested. [60 FR 36964, July 19, 1995, as amended at 71 FR 46387, Aug. 14, 2006] (a) Supplemental information. DOE may request supplementary information relating to the application. (b) Audits. DOE may require the applicant to conduct at its own expense and submit an independent audit, or DOE may conduct an audit, to verify the number of kilowatt-hours claimed to have been generated and sold by the qualified renewable energy facility and for which an incentive payment has been requested or made. (c) DOE determinations. The Assistant Secretary for Energy Efficiency and Renewable Energy shall determine the extent to which appropriated funds are available to be obligated under this program for each fiscal year. Upon evaluating each application and any other relevant information, DOE shall further determine: (1) Eligibility of the applicant for receipt of an incentive payment, based on the criteria for eligibility specified in this part; (2) The number of kilowatt-hours to be used in calculating a potential incentive payment, based on the net electric energy generated from a qualified renewable energy source at the qualified renewable energy facility and sold during the prior fiscal year; (3) The number of kilowatt-hours to be used in calculating a potential additional incentive payment, based on the total quantity of accrued energy generated during prior fiscal years; (4) The amounts represented by 60 percent of available funds and by 40 percent of available funds; and (5) Whether justification exists for altering the 60:40 payment ratio specified in paragraph (e) of this section. If DOE intends to modify the 60:40 ratio, the Department shall notify Congress, setting forth reasons for such change. (d) Calculating payments. Subject to the provisions of paragraph (e) of this section, potential incentive payments under this part shall be determined by multiplying the number of kilowatt-hours determined under §451.9(c)(2) by 1.5 cents per kilowatt-hour, and adjusting that product for inflation for each fiscal year beginning after calendar year 1993 in the same manner as provided in section 29(d)(2)(B) of the Internal Revenue Code of 1986, except that in applying such provisions calendar year 1993 shall be substituted for calendar year 1979. Using the same procedure, a potential additional payment shall be determined for the number of kilowatt-hours determined under paragraph (c)(3) of this section. If the sum of these calculated payments does not exceed the funds determined to be available by the Assistant Secretary for Energy Efficiency and Renewable Energy under §451.9(c), DOE shall make payments to all qualified applicants. (e) Insufficient funds. If funds are not sufficient to make full incentive payments to all qualified applicants, DOE shall— (1) Calculate potential incentive payments, if necessary on a pro rata basis, not to exceed 60 percent of available funds to owners or operators of qualified renewable energy facilities using solar, wind, ocean, geothermal, and closed-loop biomass technologies based on prior year energy generation; (2) Calculate potential incentive payments, if necessary on a pro rata basis, not to exceed 40 percent of available funds to owners or operators of all other qualified renewable energy facilities based on prior year energy generation; (3) If the amounts calculated in paragraph (e)(1) and (2) of this section result in one owner group with insufficient funds and one with excess funds, allocate excess funds to the owner group with insufficient funds and calculate additional incentive payments, on a pro rata basis if necessary, to such owners or operators based on prior year energy generation. (4) If potential payments calculated in paragraphs (e)(1), (2), and (3) of this section do not exceed available funding, allocate 60% of remaining funds to paragraph (e)(1) recipients and 40% to paragraph (e)(2) recipients and calculate additional incentive payments, if necessary on a pro rata basis, to owners or operators based on accrued energy; (5) If the amounts calculated in paragraph (e)(4) of this section result in one owner group with insufficient funds and one with excess funds, allocate excess funds to the owner group with insufficient funds and calculate additional incentive payments, on a pro rata basis if necessary, to such owners or operators based on accrued energy. (6) Notify Congress if potential payments resulting from paragraphs (e)(3) or (5) of this section above will result in alteration of the 60:40 payment ratio; (7) Make incentive payments based on the sum of the amounts determined in paragraphs (e)(1) through (5) of this section for each applicant; (8) Treat the number of kilowatt-hours for which an incentive payment is not made as a result of insufficient funds as accrued energy for which future incentive payment may be made; and (9) Maintain a record of each applicant's accrued energy. (f) Notice to applicant. After calculating the amount of the incentive payment under paragraphs (e) through (g) of this section, the DOE Deciding Official shall then issue a written notice of the determination to the applicant— (1) Approving the application as eligible for payment and forwarding a copy to the DOE Finance Office with a request to pay; (2) Setting forth the calculation of the approved amount of the incentive payment; and (3) Stating the amount of accrued energy, measured in kilowatt-hours, for each qualified renewable energy facility, if any, and the energy source for same. (g) Disqualification. If the application does not meet the requirements of this part or some of the kilowatt-hours claimed in the application are disallowed as unqualified, the Deciding Official shall issue a written notice denying the application in whole or in part with an explanation of the basis for denial. [60 FR 36964, July 19, 1995, as amended at 71 FR 46387, Aug. 14, 2006] (a) In order to exhaust administrative remedies, an applicant who receives a notice denying an application in whole or in part shall appeal, on or before 45 days from date of the notice issued by the DOE Deciding Official, to the Office of Hearings and Appeals, 1000 Independence Avenue, S.W., Washington, D.C. 20585, in accordance with the procedures set forth in subpart C of 10 CFR part 1003. (b) If an applicant does not appeal under paragraph (a) of this section, the determination of the DOE Deciding Official shall become final for DOE and judicially unreviewable. (c) If an applicant appeals on a timely basis under paragraph (a) of this section, the decision and order of the Office of Hearings and Appeals shall be final for DOE. (d) If the Office of Hearings and Appeals orders an incentive payment, the DOE Deciding Official shall send a copy of such order to the DOE Finance Office with a request to pay.
Title 10: Energy
PART 451—RENEWABLE ENERGY PRODUCTION INCENTIVES
Section Contents
§ 451.1 Purpose and scope.
§ 451.2 Definitions.
§ 451.3 Who may apply.
§ 451.4 What is a qualified renewable energy facility.
§ 451.5 Where and when to apply.
§ 451.6 Duration of incentive payments.
§ 451.7 Metering requirements.
§ 451.8 Application content requirements.
§ 451.9 Procedures for processing applications.
§ 451.10 Administrative appeals.
§ 451.1 Purpose and scope.
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§ 451.2 Definitions.
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§ 451.3 Who may apply.
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§ 451.4 What is a qualified renewable energy facility.
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§ 451.5 Where and when to apply.
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§ 451.6 Duration of incentive payments.
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§ 451.7 Metering requirements.
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§ 451.8 Application content requirements.
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§ 451.9 Procedures for processing applications.
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§ 451.10 Administrative appeals.
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