5. Research and Development Bill

1105314-1 : n : 12/16/2008 : LFO-KF / DJ

SYNOPSIS: This bill establishes the Alabama Public Interest Energy Research and Development Grants Program to provide funding for energy related public interest research and development projects that advance science or technology for Alabama’s unique portfolio of energy resources, particularly the significant fossil fuel and bioenergy resources of the state.

This bill creates a new executive agency to be known as the Commission on Public Interest Energy Research and Development Grants which will have sole discretion to distribute appropriations by the Legislature and other funds allocated for public interest energy research and development grants. The Permanent Joint Legislative Committee on Energy Policy shall be an advisory committee to the Commission.

The bill establishes the Public Interest Energy Research and Development Grants Fund within the State Treasury to receive appropriations from the Legislature and other gifts, grants, federal funds, and other funds. The bill also makes an appropriation from the State General Fund to the Fund for the fiscal year ending September 30, 2009 and also for the fiscal year ending September 30, 2010.

A BILL

TO BE ENTITLED

AN ACT

To establish the Alabama Public Interest Energy Research and Development Grants Program to provide funding for energy related public interest energy research and development; to create a new executive agency to be known as the Commission on Public Interest Energy Research and Development Grants which will have sole discretion to distribute appropriations by the Legislature and other funds allocated for public interest energy research and development grants; to establish the Public Interest Energy Research and Development Grants Fund within the State Treasury; and to make an appropriation from the State General Fund to the Fund for the fiscal year ending September 30, 2009 and also for the fiscal year ending September 30, 2010.

BE IT ENACTED BY THE LEGISLATURE OF ALABAMA:

Section 1. The Legislature hereby finds and declares all of the following:

(1) It is in the best interest of the people of the state and the quality of life its citizens will be improved by providing environmentally sound, safe, reliable, and affordable energy services and products.

(2) To improve the quality of life of the state’s citizens, it is proper and appropriate for the state to develop a sustained program of public interest energy research and development for projects that are not adequately provided for by competitive and regulated energy markets.

(3) Public interest energy research and development projects should advance energy science and technologies of value to Alabama’s citizens and take advantage of Alabama’s unique portfolio of energy resources, including fossil fuel and bioenergy resources.

Section 2. (a) The Public Interest Energy Research and Development Grants Program is hereby created. The program shall include a full range of research and development activities that are not adequately provided for the in the competitive and regulated markets. The Commission on Public Interest Energy Research and Development Grants established in Section 3 of this act shall administer the program.

(b) The general goals of this program are to develop, and help bring to market, technologies that enhance Alabama’s unique portfolio of energy resources and potential energy sources, particularly the significant fossil fuel and bioenergy resources of the state; provide increased environmental benefits; increase energy reliability in times of crisis; and lower energy costs.

(c) To achieve the goals established in subdivision (b), the Commission on Public Interest Energy Research and Development Grants shall adopt a portfolio approach for the program that does all of the following:

(1) Effectively balances the risks, benefits, and time horizons for various activities and investments that will provide benefits for Alabama citizens.

(2) Emphasizes innovative fossil fuel and bioenergy supply and end use technologies, focusing on their reliability, affordability, and environmental attributes.

(3) Includes projects that have the potential to enhance the production, reliability, storage and distribution capabilities of current energy sources as well as potential fossil fuel and bioenergy sources.

(4) Accelerates knowledge transfer and technological innovations.

(5) Demonstrates a balance between short-term, mid-term, and long-term potential.

(6) Ensures that prior, current, and future research not be unnecessarily duplicated.

(7) Provides for the future market utilization of projects funded through the program.

(8) Stimulates growth-oriented fossil fuel and bioenergy enterprises within the state.

(9) Ensures an open project selection process and encourages the awarding of research funding for a diverse type of research as well as a diverse award recipient base and equally considers research proposals from the public and private sectors.

(10) Encourages partnerships and collaborative projects between private enterprises, Alabama's universities, and research organizations in fossil fuels and bioenergy.

(11) Coordinates with other research programs.

(d) To ensure the efficient implementation and administration of the program, the Commission on Public Interest Energy Research and Development Grants shall do both of the following:

(1) Develop procedures for the solicitation of grant applications for projects or program funding, and to ensure efficient program management.

(2) Evaluate and select programs and projects, based on merit, that will be funded under the program.

Section 3. (a) There is hereby created the Commission on Public Interest Energy Research and Development Grants (hereinafter referred to as the commission) which shall be a grant-making agency to receive and, by majority vote of the membership or of those voting, to distribute any funds available in the Public Interest Energy Research and Development Grant Fund established in Section 4 of this act. The commission shall consist of the State Oil and Gas Supervisor, the State Climatologist, the Lieutenant Governor, the Director of the Department of Economic and Community Affairs, President of the Public Service Commission, and the Commissioner of Agriculture and Industries. The chairman of the commission shall be the Lieutenant Governor, who shall only vote in the case of a tie. The commission shall elect a secretary who shall be responsible for and maintain all documents related to the commission. The commission shall meet at least twice each quarter or until all grant funds have been awarded for each fiscal year. The commission members shall serve without compensation but the commission shall receive funds and/or staffing for administrative support from the Legislature.

(b) It shall be the duty of the Permanent Joint Legislative Committee on Energy Policy to review applications and recommend to the commission for approval any public interest energy research and development grants made from funds available in the Public Interest Energy Research and Development Grants Fund established in Section 4 of this act. The committee shall evaluate grant proposals based on the relevance of such proposals to the purposes for which such grants shall be made; the extent to which such grant proposal advances the program objectives; the ability of the grant recipient to fulfill the objectives of the grant proposal; and the extent to which the grant proposal can benefit the greatest number of citizens. The committee shall act in an advisory role only. All grants recommended for approval or rejection by the committee shall be forwarded to the Commission on Public Interest Energy Research and Development Grants which shall review each grant for compliance with the criteria listed herein and shall approve or disapprove each grant. The commission shall have absolute discretion to award or reject any grant. The commission shall report to the committee within 14 days after any meeting all actions taken.

(c) The commission shall prepare and submit to the Legislature, not later than March 31 of each year, a report on grants made pursuant to this act and progress toward achieving the goals set forth for the program. The report shall include information on the names of the recipients, the amount of awards, and the types of projects funded, an evaluation of the success of previously funded projects, and recommendations for improvements in the program.

Section 4. (a) There is hereby created in the State Treasury a fund to be known as the “Public Interest Energy Research and Development Grants Fund.” The fund may receive state appropriations, gifts, grants, federal funds and any other funds both private and public. The fund shall be kept separate and apart from all other moneys in the treasury and shall be used for the purposes set forth in this act only by warrant of the State Comptroller upon the State Treasurer, upon itemized vouchers, approved by the chairman of the Commission on Public Interest Energy Research and Development Grants. No funds may be withdrawn or expended except as budgeted and allotted according to Article 4 of Chapter 4 of Title 41, Code of Alabama 1975. The unobligated balance of the fund shall be invested by the State Treasurer for the benefit of the fund. Any interest earnings on the fund shall be credited only to the fund. Any unallocated appropriations made by the Legislature to the fund shall not revert at the end of any state fiscal year, but shall remain available for expenditure in subsequent fiscal years.

(b) There is hereby appropriated the amount of $100,000 from the State General Fund to the Public Interest Energy Research and Development Grants Fund for the fiscal year ending September 30, 2009 and also for the fiscal year ending September 30, 2010, to be used to provide funding for the Public Interest Energy Research and Development Grants Program as established by this act.

Section 5. All laws or parts of laws which conflict with this act are repealed.

Section 6. This act shall become effective immediately upon its passage and approval by the Governor, or its otherwise becoming law.