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Recently introduced HB4116 is an expansive piece of energy legislation would impact a wide range of issues in Illinois including the introduction of long-term storage system planning and integrated resource plans, assurance of data access that is critical to retail suppliers’ development of value-added services and products, changes to interconnection standards, and significant changes to ICC and state agency responsibilities. In the long term, it could lead to Illinois leaving PJM and MISO to form its own ISO. 

As introduced, this is a wide-ranging bill that would create or amend a number of acts, effective immediately.

Municipal and Cooperative Electric Utility Transparent Planning Act
This act would require five-year integrated resource plans (IRPs) of: (1) all generation and transmission electric coops; (2) all municipal power agencies; and (3) all municipalities and distribution electric coops with more than 7,000 retail electric customer meters. The first IRP process would begin by 1/1/27, with IRPs due by 1/1/28 and every five years thereafter. The IRPs must include technically feasible least-cost portfolio scenarios for constructing or procuring renewable resources to meet at least 40% of its energy needs by 2030 and supplying 100% of its projected load through carbon-free resources in combination with storage resources and demand-side programs by 2045. The act also specifies stakeholder processes and a list of prequalified consulting firms. The bill would also make conforming changes to the Open Meetings Act and General Not For Profit Corporation Act.

Utility Data Access Act
This act would require ICC, within two years of the effective date, to adopt data access rules for all utilities with at least 500,000 Illinois customers, including requiring that utilities:

• retain all consumption data for at least two years and all usage data for at least five years and, until that time, not delete or alter data that has been provided to a qualified recipient except to correct errors or reflect rebills;
• provide covered usage data to any entity authorized by an account holder upon authorized request;
• provide aggregated usage data upon request by the owner of a multi-meter building or property or their authorized agent;
• establish a tool or process to enable data requests;
• provide updates or corrections to previously provided usage information;
• respond to initial data requests within 30 days;
• provide requested data on at least a monthly schedule, to be set by ICC, until the recipient revokes the request or is no longer qualified to receive the data; and
• not charge for provision of usage data.

Electric Vehicle Act
The bill would amend this act transfer administration of beneficial electrification programs from utilities to the state EPA, giving the agency broad authority to provide grants and other forms of financial assistance using funds from the Electric Vehicle and Charging Fund. The EPA would take over administration on 1/1/29 and would be required to publish a draft 3-year Beneficial Electrification Plan by 3/1/28.

Thermal Energy Network Revolving Loan and Financial Assistance Program
This act would authorize the Illinois Finance Authority to create the Thermal Energy Network Revolving Loan and Financial Assistance Program (Thermal Loan Program) to provide access to capital for thermal energy network projects that take into consideration the risks involved in the development of shared heating and cooling systems and the required coordination among multiple customers.

Illinois Power Agency Act
The bill would amend this act to:

• authorize IPA to propose a payment structure for the Illinois Solar for All (ILSFA) subprogram low-income single-family and small multifamily solar incentive (Low-Income Incentive), intended to maximize equitable participation, under which applicant firms are advanced capital that is disbursed after contract execution but before energization, upon a demonstration of qualification or need under IPA-established criteria focused on supporting businesses that are small, emerging, or most acutely face barriers to capital access;
• include master-metered multifamily buildings that primarily house income-eligible residents as eligible for ILSFA incentives for non-profits and public facilities (Non-Profit Incentive);
• authorizing IPA to direct to the Illinois Storage for All program (if developed) up to 25% of funds allocated to the ILSFA subprograms: (i) Low-Income Incentive; (ii) Non-Profit Incentives; and (iii) low-income large multifamily solar incentive; and
• allow verification for participation in ILSFA Low-Income Incentive and Non-Profit Incentive subprograms to include pathways for self-attestation if the applicant’s residence is located in a low-income or environmental justice community and directing IPA to proactively explore less-burdensome income verification approaches.
• amend the requirement that limits the total of renewable energy resources procured under the procurement plan for a single year to the amount necessary to limit the annual estimated average net increase paid by eligible electric retail customers to 4.25% of the amount paid per kWh during the year ending 5/31/09 to adjust the 4.25% limit for inflation annually, beginning 6/1/26, with a maximum increase of 1.65 percentage points;
• amend the provisions regarding IPA’s procurement of RECs to allow for a one-time post-award bilateral renegotiation of select terms of a contract for new utility-scale wind or solar projects entered into prior to 1/1/25, including: (i) project map; (ii) real estate footprint; (iii) generator location; and (iv) potential reduction in quantity of RECs to be delivered;
• amend the Adjustable Block program requirement to include at least 20% from distributed renewable energy generation (DG) devices with a nameplate capacity of 25kW – 5MW to: (i) require that a project not be co-located with one or more other DG projects or community renewable generation projects if the aggregate capacity exceeds 5MW; (ii) deem as co-located projects on adjacent parcels that are owned, controlled, or originating from a single developer and serving affiliated loads; (iii) allow that projects from the same developer, on the same or adjacent parcels, and that serve unaffiliated loads may be deemed as co-located if documentation indicates affiliated management and ownership in the pre-development, development, construction, and management of the project; (iv) require that a parcel not be divided into multiple parcels within five years of submission of a project application; (v) require that multiple community solar projects on a single parcel demonstrate that they are unaffiliated in order to not be considered affiliated;
• authorize the IPA, through its long-term renewable resources procurement plan, to implement solutions to maintain stable and consistent REC offerings allocated to DG resources of 25kW or less to avoid gaps in availability during a delivery year, including by creating a floating block of REC capacity;
• require that, effective immediately, payment of 50% of the REC delivery contract value based on estimated generation during the first 15 years of operation with the remaining value paid ratably over the subsequent six years for RECs procured through the Adjustable Block program from DG resources of 25kW or less and from projects by applicants that are equity eligible contractors;
• require IPA to establish: (i) program requirements and minimum contract terms for vendors and others involved in the marketing, sale, installation, and financing of DG systems and community solar subscriptions; and (ii) a registration process for entities that provide financing for consumers for the purchase of DG devices;
• authorize IPA to: (i) propose that vendors post a reasonable security bond as part of the application and annual recertification process; (ii) establish requirements for DG device sales or financing offers where the customer is promised the pass-through of all or a portion of the payments;
• require for pass-through sales or financing offers for DG devices that the vendor: (i) submit proof of customer payments; and (ii) attest on an IPA-developed form that it has not filed for bankruptcy or ben subject to or threatened with involuntary insolvency;
• authorize IPA to propose additional solutions to: (i) ensure that a vendor’s promised payments are received by customers, (ii) incentivize vendors to establish service agreements with customers whose original vendor has become nonresponsive, (iii) ensure that customers receive restitution for financial harm by a program vendor, and (iv) otherwise ensure that customers do not suffer loss or harm through activities supported by the Adjustable Block and ILSFA programs;
• require entities opting to comply with the minimum equity standard through ILSFA to submit a compliance plan to the IPA at the beginning of each delivery year;
• create the Energy Storage System Portfolio Standard (ESSPS) for electric utilities with 300,000 or more Illinois customers, including: (i) storage targets; (ii) a bid selection processed; and (iii) proposals for the financial support of energy storage systems (ESS) using contract models such as an indexed storage credit procurement or others;
• require IPA to develop a Long-Term ESS Resources Procurement Plan (ESSRPP), to be reviewed at least every two years, that will include competitive procurement events and/or procurement programs as necessary for utilities to meet the ESSPS;
• require IPA, by the earlier of 8/26/26 or 90 days after enactment, conduct a competitive procurement for stand-alone ESS that can achieve commercial operation by 12/31/29 or an alternative date no later than 12/31/30: (i) of at least 450MW in MISO Zone 4 and 586MW in the PJM ComEd Area; (ii) adopting a standard indexed storage credit contract model with 20-year contracts;
• require IPA to conduct a series of additional ESS procurement annually for 2026-2029 resulting in contracts for at least the following, with a MISO/PJM split similar to that of the first procurement: (i) 3GW of cumulative ESS capacity that can achieve commercial operation by 12/31/29 or an alternative date no later than 12/31/30; (ii) 6GW of cumulative ESS capacity that can achieve commercial operation by 12/31/34; and
• require that: (i) IPA not procure storage credits from resources from ESS whose costs were being regulated by any state on or after 1/1/17: and (ii) bidders certify that they are not electric utilities serving more than 10,000 Illinois customers.

Property Tax Code
The bill would add Division 22, which would govern commercial energy storage systems.

Counties Code
The bill would amend the code:

• with respect to commercial wind and solar facilities to: (i) limit application fees to $5,000 per MW with a $125,000 maximum; (ii) allow requirement of a single building permit and permit fee, limited to $5,000 per MW with a $75,000 maximum; and (iii) allow for requirement of reimbursement of reasonable expenses for processing of applications or permits;
• to establish maximum county zoning requirements for ESS, including prohibiting adoption of regulations that, permanently or temporarily, disallows development or operation of an ESS to allow agricultural or industrial uses; and
• to establish a “Solar Bill of Rights” that, among other things, prohibits county or municipal ordinances or other exercises of power that have the effect of prohibiting installation of solar energy systems or low-voltage solar-powered devices;

Public Utilities Act
The bill would amend the act to:

• replace, as of 2027, current energy efficiency savings goals for utilities with the following goals with percentages based on average annual electricity sales from 2021-2023: (i) for utilities serving 3 million or more Illinois retail customers, 2%; and (ii) for utilities serving 500,000 to 3 million customers, savings equivalent to 1.4% in 2027, 1.7% in 2028, and 2% thereafter;
• require utilities serving 500,000 – 3 million retail customers to achieve incremental annual coincident peak demand savings goals from energy efficiency measures equal to the percentages above divided by the actual average ratio of kWh savings to coincident peak demand reduction achieved by the utility in 2023;
• require that at least 33% of all costs of offering and promoting electrification measures and at least 25% of total energy efficiency program spending go to programs exclusively targeted to low-income households;
• require utilities to file three-year energy efficiency plans to commence 1/1/27;
• replace the current adjustment to a utility’s ROE for performance on its energy savings and peak demand savings goals;
• remove the prohibition on construction of new nuclear power reactors with capacities over 300MW;
• require ICC, by 12/31/25 and every other year thereafter, to open an investigation to adopt a renewable energy access plan (REAP) update that: (i) considers electric transmissions projects, policies, and alternatives and advanced transmission technologies; (ii) evaluates and recommends improvements to the REAP; (iii) includes updated inputs and assumptions from the IRP; and (iv) includes evaluation of identified and proposed transmission projects, including proposed advanced transmission technology projects, and develops a list of recommended projects;
• direct ICC to coordinate with the Illinois Finance Authority to establish the Thermal Loan Program, authorize up to $20 million to support thermal energy network pilot projects;
• establishes Thermal Loan Program cost recovery and reporting requirements;
• require that electricity providers allow net metering for ESS or vehicle storage systems (VSS) of up to 5MW energized after the effective date;
• require ESS or VSS: (i) if interconnected behind the meter (BTM) of a retail customer, receive service under an hourly supply tariff, time-of-use (TOU) tariff, or TOU contract with an alternative retail electric supplier (ARES); and (ii) if interconnected at the distribution system level, receive service from a provider as a retail customer under an hourly supply tariff authorized by Section 16-107 or from an ARES under a supply tariff or contract with substantially similar terms;
• amend the required $250/kWh utility rebate for retail customer installation of solar-plus-storage to: (i) require that the owner or operator of the DG system provide proof of participation in the frequency regulation market; (ii) include community solar projects in the rebate;
• require ICC to establish a scheduled dispatch virtual power plant (VPP) program that: (i) is required for customers that own or operate an ESS and receive the solar-plus-storage rebate; (ii) must require an enrollment period of five years and that each participating system commits to dispatch each weekday of June through September, from 4:00 to 6:00 for BTM interconnections and from 4:00 to 7:00 otherwise; (iii) must be open to all customer classes with eligible ESS; and (iv) will have compensation set by ICC with a minimum of $10 per kW of average dispatch paid at the end of the year;
• require public utilities to file: (i) initial dispatch VPP tariffs by 6/1/26; and (ii) reports on the program by 12/31/28;
• require electric utilities to offer at least one market-based TOU rate option for eligible customers who choose to take power and energy supply service from the utility, that: (i) is offered to at least net metering customers; (ii) includes at least peak, off-peak, and super-off-peak time blocks, with a description for the methodology of determining each block; and (iii) has its charges adjusted no more than monthly and time blocks adjusted no more than annually;
• direct ICC, by 12/31/28, to approve at least one VPP program tariff for each electric utility serving more than 300,000 Illinois customers;
• require that the utilities’ VPP programs: (i) allow for enrollment directly or through aggregators; (ii) provide a mechanism to incorporate existing programs; (ii) provide grid services opportunities for each eligible technology provided; (iii) include provisions for customer enrollment of multiple devices; (iv) include upfront payment or performance payment compensation mechanisms for the peak reduction service; (v) enable low-to-moderate income customers, community-driven community solar projects, and customers whose electric service has not been declared competitive to receive higher upfront enrollment payments; (vi) provide that the performance payment rate at enrollment be for five years, at which point the customer may re-enroll for an additional five-year term; and (vii) provide for transition of customers from the scheduled dispatch program to the VPP program;
• specify the ESSRPP process, including that, if needed to address resource adequacy challenges, plans may include the procurement of long-term contracts for energy, capacity, environmental attributes, or resource adequacy attributes;
• require alternative retail electric suppliers (ARES) to comply with any ESSRPP processes;
• repeal the required utility on-bill financing program for purchases related to energy efficiency programs on 1/1/27;
• find that PJM and MISO have consistently failed to represent Illinois’ interest and: (i) direct ICC to conduct a policy study of the feasibility, costs, and benefits of creating a state-specific Independent System Operator (ISO) and publish; (ii) if the results of the initial study are favorable, authorize ICC to conduct an additional study exploring steps required to establish a state-specific ISO; and (iii) authorize the Governor and legislature to require the exploratory study regardless of the results of the initial study;
• require ICC to adopt rules to establish and track: (i) reasonable average and maximum target energization time periods for energization projects; (ii) energization annual reporting requirements for utilities; and (iii) procedures for customers to report energization delays to ICC;
• require ICC Staff, coordinating with ICC, IPA, and any other necessary agencies to compile and propose an IRP by 12/31/26 and every four years thereafter;
• require ARES to provide information related to the resource needs of its customers in a utility’s territory as requested by ICC or the agencies to compile and develop the IRP;
• specify the content of and review and approval processes for IRPs, including authorize ICC, as part of a decision to approve or modify an IRP, order changes to, expansion of, or direct action in existing programs as necessary to ensure sufficient procurement or manage demand, with delay of emissions reductions requirements permitted only if a resource adequacy shortfall would remain given all reasonable changes of other plans and programs;
• require municipal systems and electric cooperative to: (i) permit residential and small commercial customers interconnect renewable self-generation energy systems up to 25kW; (ii) not require self-generating customers to name the system or coop as an additional insured party on insurance policies; and (iii) not require self-generating customers to have minimum levels of liability insurance so long as the contractor installing the renewable generating facility is licensed and possesses commercial liability insurance coverage of at least $1 million per occurrence and $2 million per year;
• establish the Interconnection Working Group (IWG) to address issues related to new generation and large loads and report to ICC annually on recommended improvements to interconnection rules, tariffs, and policies; and
• establish the office of the Interconnection Monitor to be responsible for overseeing utility compliance with interconnection regulations and statutes and authorize the office to establish an informal interconnection dispute resolution process.

See also HB4120, which appears to be identical except that it is not effective immediately.