To amend sections 122.41, 122.451, 3706.01, 3706.02, 3706.03, 3706.04, 3706.041, 3706.05, 3706.06, 3706.07, 3706.08, 3706.09, 3706.10, 3706.11, 3706.12, 3706.13, 3706.14, 3706.15, 3706.16, 3706.17, 3706.18, 4905.31, 4905.40, 4909.161, 4928.01, 4928.02, 4928.05, 4928.06, 4928.12, 4928.14, 4928.15, 4928.16, 4928.17, 4928.18, 4928.20, and 4928.21, to enact sections 1551.41, 4928.111, 4928.141, 4928.142, 4928.64, 4928.68, and 4928.69, and to repeal sections 4928.31, 4928.32, 4928.33, 4928.34, 4928.35, 4928.36, 4928.37, 4928.38, 4928.39, 4928.40, 4928.41, 4928.42, 4928.431, and 4928.44 of the Revised Code to revise state energy policy to address electric service price regulation and to provide for new bonding authority for advanced energy projects, advanced (including sustainable resource) energy portfolio standards, energy efficiency standards, and greenhouse gas emission reporting and carbon control planning requirements.

Section 1. That sections 122.41, 122.451, 3706.01, 3706.02, 3706.03, 3706.04, 3706.041, 3706.05, 3706.06, 3706.07, 3706.08, 3706.09, 3706.10, 3706.11, 3706.12, 3706.13, 3706.14, 3706.15, 3706.16, 3706.17, 3706.18, 4905.31, 4905.40, 4909.161, 4928.01, 4928.02, 4928.05, 4928.06, 4928.12, 4928.14, 4928.15, 4928.16, 4928.17, 4928.18, 4928.20, and 4928.21 be amended and sections 1551.41, 4928.111, 4928.141, 4928.142, 4928.64, 4928.68, and 4928.69 of the Revised Code be enacted to read as follows:

Sec. 122.41.  (A) The development financing advisory council and the director of development are invested with the powers and duties provided in Chapter 122. of the Revised Code, in order to promote the welfare of the people of the state, to stabilize the economy, to provide employment, to assist in the development within the state of industrial, commercial, distribution, and research activities required for the people of the state, and for their gainful employment, or otherwise to create or preserve jobs and employment opportunities, or improve the economic welfare of the people of the state, and also to assist in the financing of air, water, or thermal pollution control facilities, advanced energy facilities, and solid waste disposal facilities by mortgage insurance as provided in section 122.451 of the Revised Code. It is hereby determined that the accomplishment of such purposes is essential so that the people of the state may maintain their present high standards in comparison with the people of other states and so that opportunities for employment and for favorable markets for the products of the state's natural resources, agriculture, and manufacturing shall be improved and that it is necessary for the state to establish the programs authorized pursuant to Chapter 122. of the Revised Code, to establish the development financing advisory council, and to invest it and the director of development with the powers and duties provided in Chapter 122. of the Revised Code. The powers granted to the director of development by Chapter 165. of the Revised Code are independent of and in addition and alternate to, and are not limited or restricted by, Chapter 122. of the Revised Code.

(B) The development financing advisory council shall:

(1) Make recommendations to the director of development as to applications for assistance pursuant to sections 122.39 to 122.62 or Chapter 166. of the Revised Code. The council may revise its recommendations to reflect any changes in the proposed assistance made by the director.

(2) Advise the director in the administration of sections 122.39 to 122.62 and Chapter 166. of the Revised Code;

(3) Adopt bylaws to govern the conduct of the council's business.

Sec. 122.451.  Upon application of any person, partnership, or corporation, or upon application of any community improvement corporation organized as provided in section 1724.01 of the Revised Code, the director of development, with controlling board approval, may, pledging therefor moneys in the mortgage insurance fund created by section 122.561 of the Revised Code, insure or make advance commitments to insure not more than ninety per cent of any mortgage payments required. Before insuring any such mortgage payments the director shall determine that:

(A) The project, in accordance with Section 13 of Article VIII, Ohio Constitution, will create or preserve jobs and employment opportunities, or improve the economic welfare of the people of the state, or be an air quality facility, advanced energy facility, waste water facility, or solid waste facility, as defined in section 3706.01, 6121.01, or 6123.01 of the Revised Code.

(B) The principal obligation, including initial service charges and appraisal, inspection, and other fees approved by the director, does not exceed one hundred per cent of the cost of the project.

(C) The mortgage has a satisfactory maturity date in no case later than twenty-five years from the date of the insurance.

(D) The mortgagor is responsible and able to meet the payments under the mortgage.

(E) The mortgage contains complete amortization provisions satisfactory to the director requiring periodic payments by the mortgagor which may include principal and interest payments, cost of local property taxes and assessments, land lease rentals, if any, and hazard insurance on the property and such mortgage insurance premiums as are required under section 122.561 of the Revised Code, all as the director from time to time prescribes or approves.

(F) The mortgage is in such form and contains such terms and provisions with respect to property insurance, repairs, alterations, payment of taxes and assessments, default reserves, delinquency charges, default remedies, anticipation of maturity, additional and secondary liens, and other matters as the director may prescribe.

The director may take assignments of insured mortgages and other forms of security and may take title by foreclosure or conveyance to any project when an insured mortgage loan thereon is clearly in default and when in the opinion of the director such acquisition is necessary to safeguard the mortgage insurance fund, and may sell, or on a temporary basis lease or rent, such project.

Sec. 1551.41.  The department of natural resources, the environmental protection agency, and the public utilities commission jointly by rule shall develop an interim policy framework for the supervision and regulation by those agencies of pilot and demonstration carbon sequestration activities located in or sequestration products produced in this state.

Sec. 3706.01.  As used in this chapter:

(A) "Governmental agency" means a department, division, or other unit of state government, a municipal corporation, county, township, and other political subdivision, or any other public corporation or agency having the power to acquire, construct, or operate air quality facilities or advanced energy facilities, the United States or any agency thereof, and any agency, commission, or authority established pursuant to an interstate compact or agreement.

(B) "Person" means any individual, firm, partnership, association, or corporation, or any combination thereof.

(C) "Air contaminant" means particulate matter, dust, fumes, gas, mist, smoke, noise, vapor, heat, radioactivity, radiation, or odorous substance, or any combination thereof.

(D) "Air pollution" means the presence in the ambient air of one or more air contaminants in sufficient quantity and of such characteristics and duration as to injure human health or welfare, plant or animal life, or property, or that unreasonably interferes with the comfortable enjoyment of life or property.

(E) "Ambient air" means that portion of the atmosphere outside of buildings and other enclosures, stacks, or ducts that surrounds human, plant, or animal life, or property.

(F) "Emission" means the release into the outdoor atmosphere of an air contaminant.

(G) "Air quality facility" means any of the following:

(1) Any method, or any modification or replacement of property, process, device, structure, or equipment that removes, reduces, prevents, contains, alters, conveys, stores, disperses, or disposes of air contaminants or substances containing air contaminants, or that renders less noxious or reduces the concentration of air contaminants in the ambient air, including, without limitation, facilities and expenditures that qualify as air pollution control facilities under section 103 (C)(4)(F) of the Internal Revenue Code of 1954, as amended, and regulations adopted thereunder;

(2) Motor vehicle inspection stations operated in accordance with, and any equipment used for motor vehicle inspections conducted under, section 3704.14 of the Revised Code and rules adopted under it;

(3) Ethanol or other biofuel facilities, including any equipment used at the ethanol or other biofuel facility for the production of ethanol or other biofuels;

(4) Any property or portion thereof used for the collection, storage, treatment, utilization, processing, or final disposal of a by-product or solid waste resulting from any method, process, device, structure, or equipment that removes, reduces, prevents, contains, alters, conveys, stores, disperses, or disposes of air contaminants, or that renders less noxious or reduces the concentration of air contaminants in the ambient air;

(5) Any property, device, or equipment that promotes the reduction of emissions of air contaminants into the ambient air through improvements in the efficiency of energy utilization or energy conservation;

(6) Any coal research and development project conducted under Chapter 1555. of the Revised Code;

(7) As determined by the director of the Ohio coal development office, any property or portion thereof that is used for the collection, storage, treatment, utilization, processing, or final disposal of a by-product resulting from a coal research and development project as defined in section 1555.01 of the Revised Code or from the use of clean coal technology, excluding any property or portion thereof that is used primarily for other subsequent commercial purposes;

(8) Any property or portion thereof that is part of the FutureGen project of the United States department of energy or related to the siting of the FutureGen project;

(9) Any property, device, or equipment that reduces emissions of air contaminants into the ambient air through the generation of electricity using sustainable resources;

(10) Any property, device, or equipment necessary for the manufacture and production of equipment that qualifies as an air quality facility.

"Air quality facility" further includes any property or system to be used in whole or in part for any of the purposes in divisions (G)(1) to (8)(10) of this section, whether another purpose is also served, and any property or system incidental to or that has to do with, or the end purpose of which is, any of the foregoing. Air quality facilities that are defined in this division for industry, commerce, distribution, or research, including public utility companies, are hereby determined to be those that qualify as facilities for the control of air pollution and thermal pollution related to air under Section 13 of Article VIII, Ohio Constitution.

(H) "Project," or "air quality project," or "advanced energy project" means any air quality facility or advanced energy facility, including undivided or other interests therein, acquired or to be acquired or constructed or to be constructed by the Ohio air quality development authority under this chapter, or acquired or to be acquired or constructed or to be constructed by a governmental agency or person with all or a part of the cost thereof being paid from a loan or grant from the authority under this chapter or otherwise paid from the proceeds of air quality revenue bonds, including all buildings and facilities that the authority determines necessary for the operation of the project, together with all property, rights, easements, and interests that may be required for the operation of the project.

(I) "Cost" as applied to an air quality project or advanced energy project means the cost of acquisition and construction, the cost of acquisition of all land, rights-of-way, property rights, easements, franchise rights, and interests required for such acquisition and construction, the cost of demolishing or removing any buildings or structures on land so acquired, including the cost of acquiring any lands to which such buildings or structures may be moved, the cost of acquiring or constructing and equipping a principal office and sub-offices of the authority, the cost of diverting highways, interchange of highways, and access roads to private property, including the cost of land or easements for such access roads, the cost of public utility and common carrier relocation or duplication, the cost of all machinery, furnishings, and equipment, financing charges, interest prior to and during construction and for no more than eighteen months after completion of construction, engineering, expenses of research and development with respect to air quality facilities, the cost of any commodity contract, including fees and expenses related thereto, legal expenses, plans, specifications, surveys, studies, estimates of cost and revenues, working capital, other expenses necessary or incident to determining the feasibility or practicability of acquiring or constructing such project, administrative expense, and such other expense as may be necessary or incident to the acquisition or construction of the project, the financing of such acquisition or construction, including the amount authorized in the resolution of the authority providing for the issuance of air quality revenue bonds to be paid into any special funds from the proceeds of such bonds, and the financing of the placing of such project in operation. Any obligation, cost, or expense incurred by any governmental agency or person for surveys, borings, preparation of plans and specifications, and other engineering services, or any other cost described above, in connection with the acquisition or construction of a project may be regarded as a part of the cost of that project and may be reimbursed out of the proceeds of air quality revenue bonds as authorized by this chapter.

(J) "Owner" includes an individual, copartnership, association, or corporation having any title or interest in any property, rights, easements, or interests authorized to be acquired by this chapter.

(K) "Revenues" means all rentals and other charges received by the authority for the use or services of any air quality project or advanced energy project, any gift or grant received with respect to any air quality such project, any moneys received with respect to the lease, sublease, sale, including installment sale or conditional sale, or other disposition of an air quality project or advanced energy project, moneys received in repayment of and for interest on any loans made by the authority to a person or governmental agency, whether from the United States or any department, administration, or agency thereof, or otherwise, proceeds of such bonds to the extent that use thereof for payment of principal of, premium, if any, or interest on the bonds is authorized by the authority, amounts received or otherwise derived from a commodity contract or from the sale of the related commodity under such a contract, proceeds from any insurance, condemnation, or guaranty pertaining to a project or property mortgaged to secure bonds or pertaining to the financing of the project, and income and profit from the investment of the proceeds of air quality revenue bonds or of any revenues.

(L) "Public roads" includes all public highways, roads, and streets in the state, whether maintained by the state, county, city, township, or other political subdivision.

(M) "Public utility facilities" includes tracks, pipes, mains, conduits, cables, wires, towers, poles, and other equipment and appliances of any public utility.

(N) "Construction," unless the context indicates a different meaning or intent, includes reconstruction, enlargement, improvement, or providing furnishings or equipment.

(O) "Air quality revenue Revenue bonds," unless the context indicates a different meaning or intent, includes air quality revenue notes, air quality revenue renewal notes, and air quality revenue refunding bonds, except that notes issued in anticipation of the issuance of bonds shall have a maximum maturity of five years as provided in section 3706.05 of the Revised Code and notes or renewal notes issued as the definitive obligation may be issued maturing at such time or times with a maximum maturity of forty years from the date of issuance of the original note.

(P) "Solid waste" means any garbage; refuse; sludge from a waste water treatment plant, water supply treatment plant, or air pollution control facility; and other discarded material, including solid, liquid, semisolid, or contained gaseous material resulting from industrial, commercial, mining, and agricultural operations, and from community activities, but not including solid or dissolved material in domestic sewage, or solid or dissolved material in irrigation return flows or industrial discharges that are point sources subject to permits under section 402 of the "Federal Water Pollution Control Act Amendments of 1972," 86 Stat. 880, 33 U.S.C.A. 1342, as amended, or source, special nuclear, or byproduct material as defined by the "Atomic Energy Act of 1954," 68 Stat. 921, 42 U.S.C.A. 2011, as amended.

(Q) "Sludge" means any solid, semisolid, or liquid waste, other than a recyclable by-product, generated from a municipal, commercial, or industrial waste water treatment plant, water supply plant, or air pollution control facility or any other such wastes having similar characteristics and effects.

(R) "Ethanol or other biofuel facility" means a plant at which ethanol or other biofuel is produced.

(S) "Ethanol" means fermentation ethyl alcohol derived from agricultural products, including potatoes, cereal, grains, cheese whey, and sugar beets; forest products; or other renewable or biomass resources, including residue and waste generated from the production, processing, and marketing of agricultural products, forest products, and other renewable or biomass resources, that meets all of the specifications in the American society for testing and materials (ASTM) specification D 4806-88 and is denatured as specified in Parts 20 and 21 of Title 27 of the Code of Federal Regulations.

(T) "Biofuel" means any fuel that is made from cellulosic biomass resources, including renewable organic matter, crop waste residue, wood, aquatic plants and other crops, animal waste, solid waste, or sludge, and that is used for the production of energy for transportation or other purposes.

(U) "FutureGen project" means the buildings, equipment, and real property and functionally related buildings, equipment, and real property, including related research projects that support the development and operation of the buildings, equipment, and real property, designated by the United States department of energy and the FutureGen industrial alliance, inc., as the coal-fueled, zero-emissions power plant designed to prove the technical and economic feasibility of producing electricity and hydrogen from coal and nearly eliminating carbon dioxide emissions through capture and permanent storage.

(V) "Commodity contract" means a contract or series of contracts entered into in connection with the acquisition or construction of air quality facilities or advanced energy facilities for the purchase or sale of a commodity that is eligible for prepayment with the proceeds of federally taxable or tax exempt bonds under sections 103, 141, and 148 of the Internal Revenue Code of 1986, as amended, and regulations adopted under it.

(W) "Sustainable resources" includes, but is not limited to, solar, wind, tidal or wave, biomass, including, but not limited to, biomass involving the utilization of trees or any part thereof, landfill gas, biofuel, hydro, or geothermal resources that are used in the generation of electricity and includes fuel cells powered by sustainable resources.

(X) "Advanced energy facility" means any method or any modification or replacement of any property, process, device, structure, or equipment that meets any of the following:

(1) With regard to clean coal technology, technology that includes the design capability to control or prevent the emission of carbon dioxide, which design capability the commission shall adopt by rule and shall be based on economically feasible best available technology or, in the absence of a determined best available technology, shall be of the highest level of economically feasible design capability for which there exists generally accepted scientific opinion;

(2) With regard to advanced nuclear energy production, consists of generation III technology as defined by the nuclear regulatory commission, other later technology, or significant improvements to existing facilities;

(3) With regard to fuel cells used in the generation of electricity, consists of, but is not limited to, a proton exchange membrane fuel cell, phosphoric acid fuel cell, molten carbonate fuel cell, or solid fuel cell;

(4) With regard to cogeneration technology, consists of a technology using a heat engine or power station to generate electricity and useful heat simultaneously.

"Advanced energy facility" further includes any property or system to be used in whole or in part for any of the purposes of divisions (X)(1) to (4) of this section, whether another purpose also is served, and any property or system incidental to or that has to do with, or the end purpose of which is, any of the foregoing.

Sec. 3706.02.  There is hereby created the Ohio air quality development authority. Such authority is a body both corporate and politic in this state, and the carrying out of its purposes and the exercise by it of the powers conferred by Chapter 3706. of the Revised Code shall be held to be, and are hereby determined to be, essential governmental functions and public purposes of the state, but the authority shall not be immune from liability by reason thereof.

The authority shall consist of seven members as follows: five members appointed by the governor, with the advice and consent of the senate, no more than three of whom shall be members of the same political party, and the director of environmental protection and the director of health, who shall be members ex officio without compensation. Each appointive member shall be a resident of the state, and a qualified elector therein. The members of the authority first appointed shall continue in office for terms expiring on June 30, 1971, June 30, 1973, June 30, 1975, June 30, 1977, and June 30, 1978, respectively, the term of each member to be designated by the governor. Appointed members' terms of office shall be for eight years, commencing on the first day of July and ending on the thirtieth day of June. Each appointed member shall hold office from the date of his appointment until the end of the term for which he was appointed. Any member appointed to fill a vacancy occurring prior to the expiration of the term for which his the member's predecessor was appointed shall hold office for the remainder of such term. Any appointed member shall continue in office subsequent to the expiration date of his the member's term until his the member's successor takes office, or until a period of sixty days has elapsed, whichever occurs first. A member of the authority is eligible for reappointment. Each appointed member of the authority, before entering upon his official duties, shall take an oath as provided by Section 7 of Article XV, Ohio Constitution. The governor may at any time remove any member of the authority for misfeasance, nonfeasance, or malfeasance in office. The authority shall elect one of its appointed members as chairman chairperson and another as vice-chairman  vice-chairperson, and shall appoint a secretary-treasurer who need not be a member of the authority. Four members of the authority shall constitute a quorum, and the affirmative vote of four members shall be necessary for any action taken by vote of the authority. No vacancy in the membership of the authority shall impair the rights of a quorum by such vote to exercise all the rights and perform all the duties of the authority.

Before the issuance of any air quality revenue bonds under Chapter 3706. of the Revised Code, each appointed member of the authority shall give a surety bond to the state in the penal sum of twenty-five thousand dollars and the secretary-treasurer shall give such a bond in the penal sum of fifty thousand dollars, each such surety bond to be conditioned upon the faithful performance of the duties of the office, to be executed by a surety company authorized to transact business in this state, and to be approved by the governor and filed in the office of the secretary of state. Each appointed member of the authority shall receive an annual salary of five thousand dollars, payable in monthly installments. Each member shall be reimbursed for his the actual expenses necessarily incurred in the performance of his official duties. All expenses incurred in carrying out Chapter 3706. of the Revised Code shall be payable solely from funds provided under Chapter 3706. of the Revised Code, appropriated for such purpose by the general assembly, or provided by the controlling board. No liability or obligation shall be incurred by the authority beyond the extent to which moneys have been so provided or appropriated.

Sec. 3706.03.  (A) It is hereby declared to be the public policy of the state through the operations of the Ohio air quality development authority under this chapter to contribute toward one or more of the following: to provide for the conservation of air as a natural resource of the state, and to prevent or abate the pollution thereof, to provide for the comfort, health, safety, and general welfare of all employees, as well as all other inhabitants of the state, to assist in the financing of air quality facilities and advanced energy facilities for industry, commerce, distribution, and research, including public utility companies, to create or preserve jobs and employment opportunities or improve the economic welfare of the people, or assist and cooperate with governmental agencies in achieving such purposes. In Additionally, advanced energy facilities for industry, commerce, distribution, or research, including public utility companies, are hereby deemed to qualify as facilities for the control of air pollution and thermal pollution related to air under Section 13, Article VIII, Ohio Constitution.

(B) In furtherance of such public policy the Ohio air quality development authority may initiate, acquire, construct, maintain, repair, and operate air quality projects and advanced energy projects or cause the same to be operated pursuant to a lease, sublease, or agreement with any person or governmental agency; may make loans and grants to governmental agencies for the acquisition or construction of air quality facilities and advanced energy facilities by such governmental agencies; may make loans to persons for the acquisition or construction of air quality facilities and advanced energy facilities by such persons; may enter into commodity contracts with, or make loans for the purpose of entering into commodity contracts to, any person, governmental agency, or entity located within or without the state in connection with the acquisition or construction of air quality facilities and advanced energy facilities; and may issue air quality revenue bonds of this state payable solely from revenues, to pay the cost of such projects, including any related commodity contracts. Any air quality project or advanced energy project shall be determined by the authority to be not inconsistent with any applicable air quality standards duly established and then required to be met pursuant to the "Clean Air Act," 84 Stat. 1679 (1970), 42 U.S.C.A. 1857, as amended. Any resolution of the authority providing for acquiring or constructing such projects or for making a loan or grant for such projects shall include a finding by the authority that such determination has been made. Determinations by resolution of the authority that a project is an air quality facility or advanced energy facility under this chapter and is consistent with the purposes of section 13 of Article VIII, Ohio Constitution, and this chapter, shall be conclusive as to the validity and enforceability of the air quality revenue bonds issued to finance such project and of the resolutions, trust agreements or indentures, leases, subleases, sale agreements, loan agreements, and other agreements made in connection therewith, all in accordance with their terms.

(C) Nothing in this chapter authorizes the Ohio air quality development authority to build, own, or operate an air quality facility or advanced energy facility, except as may be required to effect the financing of the facility.

Sec. 3706.04.  The Ohio air quality development authority may:

(A) Adopt bylaws for the regulation of its affairs and the conduct of its business;

(B) Adopt an official seal;

(C) Maintain a principal office and suboffices at such places within the state as it designates;

(D) Sue and plead in its own name; be sued and impleaded in its own name with respect to its contracts or torts of its members, employees, or agents acting within the scope of their employment, or to enforce its obligations and covenants made under sections 3706.05, 3706.07, and 3706.12 of the Revised Code. Any such actions against the authority shall be brought in the court of common pleas of the county in which the principal office of the authority is located, or in the court of common pleas of the county in which the cause of action arose, provided such county is located within this state, and all summonses, exceptions, and notices of every kind shall be served on the authority by leaving a copy thereof at the principal office with the person in charge thereof or with the secretary-treasurer of the authority.

(E) Make loans and grants to governmental agencies for the acquisition or construction of air quality projects or advanced energy projects by any such governmental agency and adopt rules and procedures for making such loans and grants;

(F) Acquire, construct, reconstruct, enlarge, improve, furnish, equip, maintain, repair, operate, lease or rent to, or contract for operation by, a person or governmental agency, air quality projects or advanced energy projects, and establish rules for the use of such projects;

(G) Make available the use or services of any air quality project or advanced energy project to one or more persons, one or more governmental agencies, or any combination thereof;

(H) Issue air quality revenue bonds and notes and air quality revenue refunding bonds of the state, payable solely from revenues as provided in section 3706.05 of the Revised Code, unless the bonds be refunded by refunding bonds, for the purpose of paying any part of the cost of one or more air quality projects or advanced energy projects or parts thereof;

(I) Acquire by gift or purchase, hold, and dispose of real and personal property in the exercise of the powers of the authority and the performance of its duties under this chapter;

(J) Acquire, in the name of the state, by purchase or otherwise, on such terms and in such manner as the authority finds proper, or by the exercise of the right of condemnation in the manner provided by section 3706.17 of the Revised Code, such public or private lands, including public parks, playgrounds, or reservations, or parts thereof or rights therein, rights-of-way, property, rights, easements, and interests as it finds necessary for carrying out this chapter, but excluding the acquisition by the exercise of the right of condemnation of any air quality facility or advanced energy facility owned by any person or governmental agency; and compensation shall be paid for public or private lands so taken;

(K) Make and enter into all contracts and agreements and execute all instruments necessary or incidental to the performance of its duties and the execution of its powers under this chapter.

(1) When the cost under any such contract or agreement, other than compensation for personal services, involves an expenditure of more than two thousand dollars, the authority shall make a written contract with the lowest responsive and responsible bidder, in accordance with section 9.312 of the Revised Code, after advertisement for not less than two consecutive weeks in a newspaper of general circulation in Franklin county, and in such other publications as the authority determines, which notice shall state the general character of the work and the general character of the materials to be furnished, the place where plans and specifications therefor may be examined, and the time and place of receiving bids; provided, that a contract or lease for the operation of an air quality project or advanced energy project constructed and owned by the authority or an agreement for cooperation in the acquisition or construction of an air quality project or advanced energy project pursuant to section 3706.12 of the Revised Code or any contract for the construction of an air quality project or advanced energy project that is to be leased by the authority to, and operated by, persons who that are not governmental agencies and the cost of such project is to be amortized exclusively from rentals or other charges paid to the authority by persons who that are not governmental agencies is not subject to the foregoing requirements and the authority may enter into such contract, lease, or agreement pursuant to negotiation and upon such terms and conditions and for such period as it finds to be reasonable and proper in the circumstances and in the best interests of proper operation or of efficient acquisition or construction of such project.

(2) Each bid for a contract for the construction, demolition, alteration, repair, or reconstruction of an improvement shall contain the full name of every person interested in it and meet the requirements of section 153.54 of the Revised Code.

(3) Each bid for a contract except as provided in division (K)(2) of this section shall contain the full name of every person interested in it and shall be accompanied by a sufficient bond or certified check on a solvent bank that if the bid is accepted a contract will be entered into and the performance thereof secured.

(4) The authority may reject any and all bids.

(5) A bond with good and sufficient surety, approved by the authority, shall be required of every contractor awarded a contract except as provided in division (K)(2) of this section, in an amount equal to at least fifty per cent of the contract price, conditioned upon the faithful performance of the contract.

(L) Employ managers, superintendents, and other employees and retain or contract with consulting engineers, financial consultants, accounting experts, architects, attorneys, and such other consultants and independent contractors as are necessary in its judgment to carry out this chapter, and fix the compensation thereof. All expenses thereof shall be payable solely from the proceeds of air quality revenue bonds or notes issued under this chapter, from revenues, or from funds appropriated for such purpose by the general assembly.

(M) Receive and accept from any federal agency, subject to the approval of the governor, grants for or in aid of the construction of any air quality project or advanced energy project or for research and development with respect to air quality facilities and advanced energy facilities, and receive and accept aid or contributions from any source of money, property, labor, or other things of value, to be held, used, and applied only for the purposes for which such grants and contributions are made;

(N) Engage in research and development with respect to air quality facilities and advanced energy facilities;

(O) Purchase fire and extended coverage and liability insurance for any air quality project and advanced energy project and for the principal office and suboffices of the authority, insurance protecting the authority and its officers and employees against liability for damage to property or injury to or death of persons arising from its operations, and any other insurance the authority may agree to provide under any resolution authorizing its air quality revenue bonds or in any trust agreement securing the same;

(P) Charge, alter, and collect rentals and other charges for the use or services of any air quality project or advanced energy project as provided in section 3706.13 of the Revised Code;

(Q) Provide coverage for its employees under Chapters 145., 4123., and 4141. of the Revised Code;

(R) Develop, encourage, promote, support, and implement programs to achieve best cost rates for state-owned buildings, facilities, and operations, state-supported colleges and universities, willing local governments, and willing school districts through pooled purchases of electricity and the financing of taxable or tax-exempt prepayment of commodities;

(S) Develop, encourage, promote, support, and implement programs to achieve optimal cost financing for electric generating facilities to be constructed on or after January 1, 2009;

(T) Develop, encourage, and provide incentives for investments in energy efficiency;

(U) Develop, encourage, promote, and support implementation in this state of sustainable resource energy installations;

(V) Lead, encourage, promote, and support siting, financing, construction, and operation for early implementations of next-generation base load generating systems, including clean coal generating facilities with carbon capture or sequestration or advanced nuclear power plants, and reduce the costs of associated risks;

(W) Engage in and coordinate state-supported energy research and development with respect to reliable, affordable, and sustainable energy in this state;

(X) Develop, encourage, promote, support, and implement programs to attract and retain key industrial and energy-intensive sectors of the economy of this state;

(Y) Do all acts necessary or proper to carry out the powers expressly granted in this chapter.

Any instrument by which real property is acquired pursuant to this section shall identify the agency of the state that has the use and benefit of the real property as specified in section 5301.012 of the Revised Code.

Sec. 3706.041.  (A) With respect to projects, and the financing thereof, for industry, commerce, distribution, or research, including public utility companies, under agreements whereby the person to whom the project is to be leased, subleased, or sold, or to whom a loan is to be made for the project, is to make payments sufficient to pay all of the principal of, premium, if any, and interest on the air quality revenue bonds issued for the project, or the counterparty under any related commodity contract agrees to make payments sufficient in amount to pay all of the principal of, premium, if any, and interest on the related air quality revenue bonds, the Ohio air quality development authority may, in addition to other powers under this chapter:

(1) Make loans for the acquisition or construction of the project to such person upon such terms as the authority may determine or authorize, including secured or unsecured loans, and, in connection therewith, enter into loan agreements and other agreements, including commodity contracts, accept notes and other forms of obligation to evidence such indebtedness and mortgages, liens, pledges, assignments, or other security interests to secure such indebtedness, which may be prior or subordinate to or on a parity with other indebtedness, obligations, mortgages, pledges, assignments, other security interests, or liens or encumbrances, and take such actions as may be considered by it appropriate to protect such security and safeguard against losses, including, without limitation thereto, foreclosure and the bidding upon and purchase of property upon foreclosure or other sale.

(2) Sell such project under such terms as it may determine, including, without limitation thereto, sale by conditional sale or installment sale, under which title may pass prior to or after completion of the project or payment or provisions for payment of all principal of, premium, if any, and interest on such bonds, or at any other time provided in such agreement pertaining to such sale, and including sale under an option to purchase at a price which may be a nominal amount or less than true value at the time of purchase.

(3) Grant a mortgage, lien, or other encumbrance on, or pledge or assignment of, or other security interest with respect to, all or any part of the project, revenues, reserve funds, or other funds established in connection with such bonds, or on, of, or with respect to any lease, sublease, sale, conditional sale or installment sale agreement, loan agreement, or other agreement pertaining to the lease, sublease, sale, or other disposition of a project or pertaining to a loan made for a project, or any guaranty or insurance agreement made with respect thereto, or any interest of the authority therein, or any other interest granted, assigned, or released to secure payments of the principal of, premium, if any, or interest on the bonds or to secure any other payments to be made by the authority, which mortgage, lien, encumbrance, pledge, assignment, or other security interest may be prior or subordinate to or on a parity with any other mortgage, assignment, other security interest, or lien or encumbrance.

(4) Provide that the interest on such bonds may be at a variable rate or rates changing from time to time in accordance with a base or formula as authorized by the authority.

(5) Contract for the acquisition or construction of such project or any part thereof, including any related commodity contracts, and for the leasing, subleasing, sale or other disposition of such project in a manner determined by the authority in its sole discretion, without necessity for competitive bidding or performance bonds.

(B) Property comprising a project shall not be subject to taxes or assessments and so long as the bonds or notes issued to finance the costs of such project are outstanding, and the transfer of title to or possession of such property to the person to whom a loan or installment sale or conditional sale with respect to such project is made shall not be subject to the taxes levied pursuant to Chapters 5739. and 5741. of the Revised Code.

The authority shall certify the property comprising a project which is exempt from taxes and assessments pursuant to this section, and shall send, by certified mail, copies of such certification to the owner of such exempt property, to the tax commissioner, and to the county auditor of the county or counties in which any such exempt property is located.

Each county auditor shall maintain a separate list of all property exempt pursuant to this section and sections 6121.044 and 6123.041 of the Revised Code, in addition to the list of exempt property required to be maintained pursuant to section 5713.07 of the Revised Code.

(C) The authority, in the lease, sale or loan agreement with respect to a project referred to in division (A) of this section, shall make appropriate provision for adequate maintenance of the project.

(D) With respect to the projects referred to in this section, the authority granted by this section is cumulative and supplementary to all other authority granted in this chapter. The authority granted by this section does not alter or impair any similar authority granted elsewhere in this chapter for or with respect to other projects.

Sec. 3706.05.  The Ohio air quality development authority may at any time issue revenue bonds and notes of the state in such principal amount as, in the opinion of the authority, are necessary for the purpose of paying any part of the cost of one or more air quality projects or advanced energy projects or parts thereof, including one or more payments pursuant to a commodity contract entered into in connection with the acquisition or construction of air quality facilities or advanced energy facilities. The authority may at any time issue renewal notes, issue bonds to pay such notes and whenever it deems refunding expedient, refund any bonds by the issuance of air quality revenue refunding bonds of the state, whether the bonds to be refunded have or have not matured, and issue bonds partly to refund bonds then outstanding, and partly for any other authorized purpose. The refunding bonds shall be sold and the proceeds applied to the purchase, redemption, or payment of the bonds to be refunded. Except as may otherwise be expressly provided by the authority, every issue of its bonds or notes shall be general obligations of the authority payable out of the revenues of the authority that are pledged for such payment, without preference or priority of the first bonds issued, subject only to any agreements with the holders of particular bonds or notes pledging any particular revenues. Such pledge shall be valid and binding from the time the pledge is made and the revenues so pledged and thereafter received by the authority shall immediately be subject to the lien of such pledge without any physical delivery thereof or further act, and the lien of any such pledge is valid and binding as against all parties having claims of any kind in tort, contract, or otherwise against the authority, irrespective of whether such parties have notice thereof. Neither the resolution nor any trust agreement by which a pledge is created need be filed or recorded except in the records of the authority.

Whether or not the bonds or notes are of such form and character as to be negotiable instruments, the bonds or notes shall have all the qualities and incidents of negotiable instruments, subject only to the provisions of the bonds or notes for registration.

The bonds and notes shall be authorized by resolution of the authority, shall bear such date or dates, and shall mature at such time or times, in the case of any such note or any renewals thereof not exceeding five years from the date of issue of such original note and in the case of any such bond not exceeding forty years from the date of issue, as such resolution or resolutions may provide. The bonds and notes shall bear interest at such rate or rates, be in such denominations, be in such form, either coupon or registered, carry such registration privileges, be payable in such medium of payment, at such place or places, and be subject to such terms of redemption as the authority may authorize. The bonds and notes of the authority may be sold by the authority, at public or private sale, at or at not less than such price or prices as the authority determines. The bonds and notes shall be executed by the chairperson and vice-chairperson of the authority, either or both of whom may use a facsimile signature, the official seal of the authority or a facsimile thereof shall be affixed thereto or printed thereon and attested, manually or by facsimile signature, by the secretary-treasurer of the authority, and any coupons attached thereto shall bear the signature or facsimile signature of the chairperson of the authority. In case any officer whose signature, or a facsimile of whose signature, appears on any bonds, notes or coupons ceases to be such officer before delivery of bonds or notes, such signature or facsimile shall nevertheless be sufficient for all purposes the same as if the officer had remained in office until such delivery, and in case the seal of the authority has been changed after a facsimile has been imprinted on such bonds or notes, such facsimile seal will continue to be sufficient for all purposes.

Any resolution or resolutions authorizing any bonds or notes or any issue thereof may contain provisions, subject to such agreements with bondholders or noteholders as may then exist, which provisions shall be a part of the contract with the holders thereof, as to: the pledging of all or any part of the revenues of the authority to secure the payment of the bonds or notes or of any issue thereof; the use and disposition of revenues of the authority; a covenant to fix, alter, and collect rentals and other charges so that pledged revenues will be sufficient to pay costs of operation, maintenance, and repairs, pay principal of and interest on bonds or notes secured by the pledge of such revenues, and provide such reserves as may be required by the applicable resolution or trust agreement; the setting aside of reserve funds, sinking funds, or replacement and improvement funds and the regulation and disposition thereof; the crediting of the proceeds of the sale of bonds or notes to and among the funds referred to or provided for in the resolution authorizing the issuance of the bonds or notes; the use, lease, sale, or other disposition of any air quality project or any other assets of the authority; limitations on the purpose to which the proceeds of sale of bonds or notes may be applied and the pledging of such proceeds to secure the payment of the bonds or notes or of any issue thereof; as to notes issued in anticipation of the issuance of bonds, the agreement of the authority to do all things necessary for the authorization, issuance, and sale of such bonds in such amounts as may be necessary for the timely retirement of such notes; limitations on the issuance of additional bonds or notes; the terms upon which additional bonds or notes may be issued and secured; the refunding of outstanding bonds or notes; the procedure, if any, by which the terms of any contract with bondholders or noteholders may be amended or abrogated, the amount of bonds or notes the holders of which must consent thereto, and the manner in which such consent may be given; limitations on the amount of moneys to be expended by the authority for operating, administrative, or other expenses of the authority; securing any bonds or notes by a trust agreement in accordance with section 3706.07 of the Revised Code; any other matters, of like or different character, that in any way affect the security or protection of the bonds or notes.

Neither the members of the authority nor any person executing the bonds or notes shall be liable personally on the bonds or notes or be subject to any personal liability or accountability by reason of the issuance thereof.

Sec. 3706.06.  The issuance of air quality revenue bonds and notes or air quality revenue refunding bonds under Chapter 3706. of the Revised Code need not comply with any other law applicable to the issuance of bonds or notes.

Sec. 3706.07.  In the discretion of the Ohio air quality development authority, any air quality revenue bonds or notes or air quality revenue refunding bonds issued under Chapter 3706. of the Revised Code, may be secured by a trust agreement between the authority and a corporate trustee, which trustee may be any trust company or bank having the powers of a trust company within or without the state.

Any such trust agreement may pledge or assign revenues of the authority to be received, but shall not convey or mortgage any air quality project or any part thereof. Any such trust agreement or any resolution providing for the issuance of such bonds or notes may contain such provisions for protecting and enforcing the rights and remedies of the bondholders or noteholders as are reasonable and proper and not in violation of law, including covenants setting forth the duties of the authority in relation to the acquisition of property, the construction, improvement, maintenance, repair, operation, and insurance of the air quality project or projects in connection with which such bonds or notes are authorized, the rentals or other charges to be imposed for the use or services of any air quality project, the application of revenues received or otherwise derived from a commodity contract or from the sale of the related commodity under such contract, the custody, safeguarding, and application of all moneys, and provisions for the employment of consulting engineers in connection with the construction or operation of such air quality project or projects. Any bank or trust company incorporated under the laws of this state that may act as depository of the proceeds of bonds or notes or of revenues may furnish such indemnifying bonds or may pledge such securities as are required by the authority. Any such trust agreement may set forth the rights and remedies of the bondholders and noteholders and of the trustee, and may restrict the individual right of action by bondholders and noteholders as is customary in trust agreements or trust indentures securing similar bonds. Such trust agreement may contain such other provisions as the authority determines reasonable and proper for the security of the bondholders or noteholders. All expenses incurred in carrying out the provisions of any such trust agreement may be treated as a part of the cost of the operation of the air quality project or projects. Any such trust agreement or resolution authorizing the issuance of air quality revenue bonds may provide the method whereby the general administrative overhead expenses of the authority shall be allocated among the several projects acquired or constructed by it as a factor of the operation expense of each such project.

Sec. 3706.08.  Any holder of air quality revenue bonds issued under Chapter 3706. of the Revised Code, or any of the coupons appertaining thereto, and the trustee under any trust agreement, except to the extent the rights given by such chapter may be restricted by the applicable resolution or such trust agreement, may by suit, action, mandamus, or other proceedings, protect and enforce any rights under the laws of the state or granted under such chapter, trust agreement, or the resolution authorizing the issuance of such bonds, and may enforce and compel the performance of all duties required by such chapter, or by the trust agreement or resolution, to be performed by the Ohio air quality development authority or any officer thereof, including the fixing, charging, and collecting of rentals or other charges.

Sec. 3706.09.  Air quality revenue Revenue bonds and notes and air quality revenue refunding bonds issued under Chapter 3706. of the Revised Code do not constitute a debt, or a pledge of the faith and credit, of the state or any political subdivision thereof, and the holders or owners thereof have no right to have taxes levied by the general assembly or taxing authority of any political subdivision of the state for the payment of the principal thereof or interest thereon, but such bonds and notes are payable solely from the revenues and funds pledged for their payment as authorized by such chapter, unless the notes are issued in anticipation of the issuance of bonds or the bonds are refunded by refunding bonds issued under such chapter, which bonds or refunding bonds shall be payable solely from revenues and funds pledged for their payment as authorized by such sections. All such bonds and notes shall contain on the face thereof a statement to the effect that the bonds or notes, as to both principal and interest, are not debts of the state or any political subdivision thereof, but are payable solely from revenues and funds pledged for their payment.

All expenses incurred in carrying out Chapter 3706. of the Revised Code are payable solely from funds provided under such chapter. Such chapter does not authorize the Ohio air quality development authority to incur indebtedness or liability on behalf of or payable by the state or any political subdivision thereof.

Sec. 3706.10.  All moneys, funds, properties, and assets acquired by the Ohio air quality development authority under Chapter 3706. of the Revised Code, whether as proceeds from the sale of air quality revenue bonds or as revenues, or otherwise, shall be held by it in trust for the purposes of carrying out its powers and duties, shall be used and reused as provided in such chapter, and shall at no time be part of other public funds. Such funds, except as otherwise provided in any resolution authorizing its air quality revenue bonds or in any trust agreement securing the same, or except when invested pursuant to section 3706.11 of the Revised Code, shall be kept in depositories selected by the authority in the manner provided in Chapter 135. of the Revised Code, and the deposits shall be secured as provided in Chapter 135. of the Revised Code. The resolution authorizing the issuance of such bonds of any issue or the trust agreement securing such bonds shall provide that any officer to whom, or any bank or trust company to which, such moneys are paid shall act as trustee of such moneys and hold and apply them for the purposes hereof, subject to such conditions as such chapter and such resolutions or trust agreement provide.

Sec. 3706.11.  Moneys in the funds of the Ohio air quality development authority, except as otherwise provided in any resolution authorizing the issuance of its air quality revenue bonds or in any trust agreement securing the same, in excess of current needs, may be invested in notes, bonds, or other obligations of the United States of America or any agency or instrumentality thereof, or in obligations of this state or any political subdivision thereof. Income from all such investments of moneys in any fund shall be credited to such funds as the authority determines, subject to the provisions of any such resolution or trust agreement and such investments may be sold at such times as the authority determines.

Sec. 3706.12.  The Ohio air quality development authority may charge, alter, and collect rentals or other charges for the use or services of any air quality project or advanced energy project and contract in the manner provided by this section with one or more persons, one or more governmental agencies, or any combination thereof, desiring the use or services of such project, and fix the terms, conditions, rentals, or other charges for such use or services. Such rentals or other charges shall not be subject to supervision or regulation by any other authority, commission, board, bureau, or agency of the state and such contract may provide for acquisition by such person or governmental agency of all or any part of such air quality project or advanced energy project for such consideration payable over the period of the contract or otherwise as the authority in its sole discretion determines to be appropriate, but subject to the provisions of any resolution authorizing the issuance of air quality revenue bonds or notes or air quality revenue refunding bonds of the authority or any trust agreement securing the same. Any governmental agency that has power to construct, operate, and maintain air quality facilities or advanced energy facilities may enter into a contract or lease with the authority whereby the use or services of any air quality project or advanced energy project of the authority will be made available to such governmental agency and may pay for such use or services such rentals or other charges as may be agreed to by the authority and such governmental agency.

Any governmental agency or combination of governmental agencies may cooperate with the authority in the acquisition or construction of an air quality project or advanced energy project and shall enter into such agreements with the authority as may be necessary, with a view to effective cooperative action and safeguarding of the respective interests of the parties thereto, which agreements shall provide for such contributions by the parties thereto in such proportion as may be agreed upon and such other terms as may be mutually satisfactory to the parties including without limitation the authorization of the construction of the project by one of the parties acting as agent for all of the parties and the ownership and control of the project by the authority to the extent necessary or appropriate for purposes of the issuance of air quality revenue bonds by the authority. Any governmental agency may provide the funds for the payment of such contribution as is required under such agreements by the levy of taxes, assessments or rentals and other charges for the use of the utility system of which the air quality project or advanced energy project is a part or to which it is connected, if otherwise authorized by the laws governing such governmental agency in the construction of the type of air quality project or advanced energy project provided for in the agreements, and may pay the proceeds from the collection of such taxes, assessments, utility rentals, or other charges to the authority pursuant to such agreements; or the governmental agency may issue bonds or notes, if authorized by such laws, in anticipation of the collection of such taxes, assessments, utility rentals, or other charges and may pay the proceeds of such bonds or notes to the authority pursuant to such agreements. In addition any governmental agency may provide the funds for the payment of such contribution by the appropriation of money or, if otherwise authorized by law, by the issuance of bonds or notes and may pay such appropriated money or the proceeds of such bonds or notes to the authority pursuant to such agreements. The agreement by the governmental agency to provide such contribution, whether from appropriated money or from the proceeds of such taxes, assessments, utility rentals, or other charges, or such bonds or notes, or any combination thereof, shall not be subject to Chapter 133. of the Revised Code or any regulations or limitations contained therein. The proceeds from the collection of such taxes or assessments, and any interest earned thereon, shall be paid into a special fund immediately upon the collection thereof by the governmental agency for the purpose of providing such contribution at the times required under such agreements.

When the contribution of any governmental agency is to be made over a period of time from the proceeds of the collection of special assessments, the interest accrued and to accrue before the first installment of such assessments shall be collected which is payable by such governmental agency on such contribution under the terms and provisions of such agreements shall be treated as part of the cost of the improvement for which such assessments are levied, and that portion of such assessments as are collected in installments shall bear interest at the same rate as such governmental agency is obligated to pay on such contribution under the terms and provisions of such agreements and for the same period of time as the contribution is to be made under such agreements. If the assessment or any installment thereof is not paid when due, it shall bear interest until the payment thereof at the same rate as such contribution and the county auditor shall annually place on the tax list and duplicate the interest applicable to such assessment and the penalty and additional interest thereon as otherwise authorized by law.

Any governmental agency, pursuant to a favorable vote of the electors in an election held before or after June 1, 1970, for the purpose of issuing bonds to provide funds to acquire, construct, or equip, or provide real estate and interests in real estate for, an air quality facility or advanced energy facility, whether or not such governmental agency, at the time of such election, had the authority to pay the proceeds from such bonds or notes issued in anticipation thereof to the authority as provided in this section, may issue such bonds or notes in anticipation of the issuance thereof and pay the proceeds thereof to the authority in accordance with its agreement with the authority; provided, that the legislative authority of the governmental agency find and determine that the air quality project or advanced energy project to be acquired or constructed by the authority in cooperation with such governmental agency will serve the same public purpose and meet substantially the same public need as the facility otherwise proposed to be acquired or constructed by the governmental agency with the proceeds of such bonds or notes.

Sec. 3706.13.  Each air quality project or advanced energy project, when constructed and placed in operation, shall be maintained and kept in good condition and repair by the Ohio air quality development authority, or the authority shall cause the same to be maintained and kept in good condition and repair. Each such project shall be operated by such operating employees as the authority employs or pursuant to a contract or lease with a person or governmental agency. All public or private property damaged or destroyed in carrying out the powers granted by Chapter 3706. of the Revised Code, shall be restored or repaired and placed in its original condition, as nearly as practicable, or adequate compensation shall be paid therefor from funds provided under such chapter.

On or before the twentieth day of April in each year, the authority shall make a report of its activities for the preceding calendar year to the governor and the general assembly. Each such report shall set forth a complete operating and financial statement covering the authority's operations during the year. The authority shall cause an audit of its books and accounts to be made at least once each year by certified public accountants and the cost thereof may be treated as a part of the cost of construction or of operations of its projects.

Sec. 3706.14.  All air quality revenue bonds issued under this chapter are lawful investments of banks, societies for savings, savings and loan associations, deposit guarantee associations, trust companies, trustees, fiduciaries, insurance companies, including domestic for life and domestic not for life, trustees or other officers having charge of sinking and bond retirement or other special funds of political subdivisions and taxing districts of this state, the commissioners of the sinking fund of the state, the administrator of workers' compensation, the state teachers retirement system, the public employees retirement system, the school employees retirement system, and the Ohio police and fire pension fund, and are acceptable as security for the deposit of public moneys.

Sec. 3706.15.  The exercise of the powers granted by Chapter 3706. of the Revised Code, will be for the benefit of the people of the state, for the improvement of their health, safety, convenience, and welfare, and for the enhancement of their residential, agricultural, recreational, economic, commercial, and industrial opportunities and is a public purpose. As the operation and maintenance of air quality projects or advanced energy projects will constitute the performance of essential governmental functions, the Ohio air quality development authority shall not be required to pay any taxes or assessments upon any air quality such project, or upon any property acquired or used by the authority under Chapter 3706. of the Revised Code, or upon the income therefrom, nor shall the transfer to or from the Ohio air quality development authority of title or possession of any air quality project or advanced energy project, part thereof, or item included or to be included in any such project, be subject to the taxes levied pursuant to Chapters 5739. and 5741. of the Revised Code, and the bonds and notes issued under this chapter, their transfer, and the income therefrom, including any profit made on the sale thereof, shall at all times be free from taxation within the state.

Sec. 3706.16.  The Ohio air quality development authority may acquire by purchase, whenever it finds such purchase expedient, any land, property, rights, rights-of-way, franchises, easements, and other interests in lands as it finds to be necessary or convenient for the construction and operation of any air quality project or advanced energy project, upon such terms and at such price as it considers reasonable and are agreed upon between the authority and the owner thereof, and take title thereto in the name of the state.

Any governmental agency, notwithstanding any contrary provision of law and without the necessity for an advertisement, auction, order of court, or other action or formality, other than the regular and formal action of such governmental agency concerned, may lease, lend, grant, or convey to the authority, at its request, upon such terms as the proper authorities of such governmental agency find reasonable and fair any real property or interests therein including improvements thereto or personal property which is necessary or convenient to effect the authorized purposes of the authority, including public roads and real or personal property already devoted to public use.

Sec. 3706.17.  The Ohio air quality development authority may acquire by appropriation pursuant to division (J) of section 3706.04 of the Revised Code any land, rights, rights-of-way, franchises, easements, or other property necessary or proper for the construction or the efficient operation of any air quality project or advanced energy project. In any proceedings for appropriation under this section, the procedure to be followed shall be in accordance with Chapter 163. of the Revised Code.

This section does not empower the authority to take or disturb property or facilities belonging to and required for the proper and convenient operation of any public utility or any common carrier engaged in interstate commerce, unless provision is made for the restoration, relocation, or duplication of such property or facilities elsewhere at the sole cost of the authority.

Sec. 3706.18.  When the Ohio air quality development authority finds it necessary to change the location of any portion of any public road, state highway, railroad, or public utility facility in connection with the construction of an air quality project or advanced energy project, it shall cause the same to be reconstructed at such location as the division of government having jurisdiction over such road, highway, railroad, or public utility facility finds most favorable. Such reconstruction shall be of substantially the same type and in as good condition as the original road, highway, railroad, or public utility facility. The cost of such reconstruction, relocation, or removal and any damage incurred in changing the location of any such road, highway, railroad, or public utility facility shall be paid by the authority as a part of the cost of such air quality the project.

When the authority finds it necessary that any public highway or portion thereof be vacated by reason of the acquisition or construction of an air quality project or advanced energy project, the authority may request the director of transportation, in writing, to vacate such highway or portion thereof in accordance with section 5511.07 of the Revised Code if the highway or portion thereof to be vacated is on the state highway system, or, if the highway or portion thereof to be vacated is under the jurisdiction of the county commissioners, the authority shall request the director, in writing, to petition the board of county commissioners, in the manner provided in section 5553.041 of the Revised Code, to vacate such highway or portion thereof. The authority shall pay to the director or to the county, as a part of the cost of such air quality the project, any amounts required to be deposited with any court in connection with proceedings for the determination of compensation and damages and all amounts of compensation and damages finally determined to be payable as a result of such vacation.

The authority may make reasonable regulations for the installation, construction, maintenance, repair, renewal, relocation, and removal of railroad or public utility facilities in, on, over, or under any air quality project or advanced energy project. Whenever the authority determines that it is necessary that any such facilities installed or constructed in, on, over, or under property of the authority pursuant to such regulations be relocated, the public utility owning or operating such facilities shall relocate or remove them in accordance with the order of the authority. The cost and expenses of such relocation or removal, including the cost of installing such facilities in a new location, and the cost of any lands, or any rights or interests in lands, and the cost of any other rights, acquired to accomplish such relocation or removal, may be paid by the authority as a part of the cost of such air quality the project. In case of any such relocation or removal of facilities, the railroad or public utility owning or operating them, its successors, or assigns may maintain and operate such facilities, with the necessary appurtenances, in the new location in, on, over, or under the property of the authority for as long a period and upon the same terms as it had the right to maintain and operate such facilities in their former location.

Sec. 4905.31.  Except as provided in section 4933.29 of the Revised Code, Chapters 4901., 4903., 4905., 4907., 4909., 4921., and 4923., and 4928. of the Revised Code do not prohibit a public utility from filing a schedule or entering into any reasonable arrangement with another public utility or with its customers, consumers, or employees providing for:

(A) The division or distribution of its surplus profits;

(B) A sliding scale of charges, including variations in rates based upon either of the following:

(1) Stipulated variations in cost as provided in the schedule or arrangement;

(2) Any emissions fee levied upon an electric light company under Substitute Senate Bill No. 359 of the 119th general assembly as provided in the schedule. The public utilities commission shall permit an electric light company to recover the emissions fee pursuant to such a variable rate schedule.

(3) Any emissions fee levied upon an electric light company under division (C) or (D) of section 3745.11 of the Revised Code as provided in the schedule. The public utilities commission shall permit an electric light company to recover any such emission fee pursuant to such a variable rate schedule.

(4) Any schedule of variable rates filed under division (B) of this section shall provide for the recovery of any such emissions fee by applying a uniform percentage increase to the base rate charged each customer of the electric light company for service during the period that the variable rate is in effect.

(C) A minimum charge for service to be rendered unless such minimum charge is made or prohibited by the terms of the franchise, grant, or ordinance under which such public utility is operated;

(D) A classification of service based upon the quantity used, the time when used, the purpose for which used, the duration of use, and any other reasonable consideration;

(E) Any other financial device that may be practicable or advantageous to the parties interested. No such arrangement, sliding scale, minimum charge, classification, variable rate, or device is lawful unless it is filed with and approved by the commission.

Every such public utility is required to conform its schedules of rates, tolls, and charges to such arrangement, sliding scale, classification, or other device, and where variable rates are provided for in any such schedule or arrangement, the cost data or factors upon which such rates are based and fixed shall be filed with the commission in such form and at such times as the commission directs. The commission shall review the cost data or factors upon which a variable rate schedule filed under division (B)(2) or (3) of this section is based and shall adjust the base rates of the electric light company or order the company to refund any charges that it has collected under the variable rate schedule that the commission finds to have resulted from errors or erroneous reporting. After recovery of all of the emissions fees upon which a variable rate authorized under division (B)(2) or (3) of this section is based, collection of the variable rate shall end and the variable rate schedule shall be terminated.

Every such arrangement, sliding scale, minimum charge, classification, variable rate, or device shall be under the supervision and regulation of the commission, and is subject to change, alteration, or modification by the commission.

Sec. 4905.40.  (A) A public utility or a railroad may, when authorized by order of the public utilities commission, issue stocks, bonds, notes, and other evidences of indebtedness, payable at periods of more than twelve months after their date of issuance, when necessary:

(1) For the acquisition of property, the construction, completion, extension, renewal, or improvement of its facilities, or the improvement of its service; or

(2) For reorganization or readjustment of its indebtedness and capitalization, for the discharge or lawful refunding of its obligation, or for the reimbursement of moneys actually expended for such purposes from income or from any other moneys in the treasury of the public utility or railroad not secured or obtained from the issue of stocks, bonds, notes, or other evidences of indebtedness of such public utility or railroad. No reimbursement of moneys expended for such purposes from income or other moneys in the treasury shall be authorized unless the applicant has kept its accounts and vouchers of such expenditures in such manner as to enable the commission to ascertain the amount and purposes of such expenditures.

(B) Any public utility, subject to the jurisdiction of the commission, may, when authorized by the commission, issue shares of common capital stock to acquire or pay for shares of common capital stock of a public utility of this or an adjoining state whose property is so located as to permit the operation of the properties of such utilities as an integrated system if the applicant owns, or by this issue will acquire, not less than sixty-five per cent of the issued and outstanding common capital shares of the company whose shares are to be acquired, and if the consideration to be capitalized by the acquiring company does not exceed the par or stated value at which the shares so acquired were issued.

(C) Any bonds, notes, or other evidences of indebtedness payable at periods of more than twelve months after their date may be issued as provided in sections 4905.40 to 4905.43 of the Revised Code, regardless of the amount of the capital stock of the public utility or railroad, subject to the approval of the commission of the excess of such bonds, notes, or other evidences of indebtedness above the amount of the capital stock of such public utility or railroad.

(D) The commission shall authorize on the best terms obtainable such issues of stocks, bonds, and other evidences of indebtedness as are necessary to enable any public utility to comply with any contract made between such public utility and any municipal corporation prior to June 30, 1911.

(E) The commission may authorize a public utility that is an electric light company to issue equity securities, or debt securities having a term of more than twelve months from the date of issuance, for the purpose of yielding to the company the capacity to acquire a facility that produces fuel for the generation of electricity.

(F) In any proceeding under division (A)(1) of this section initiated by a public utility, the commission shall determine and set forth in its order:

(1) Whether the purpose to which the issue or any proceeds of it shall be applied was or is reasonably required by the utility to meet its present and prospective obligations to provide utility service;

(2) Whether the amount of the issue and the probable cost of such stocks, bonds, notes, or other evidences of indebtedness is just and reasonable;

(3) What effect, if any, the issuance of such stocks, bonds, notes, or other evidences of indebtedness and the cost thereof will have upon the present and prospective revenue requirements of the utility.

(G) Sections 4905.40 to 4905.42 of the Revised Code do not apply to stocks, bonds, notes, or other evidence of indebtedness issued for the purpose of financing oil or natural gas drilling, producing, gathering, and associated activities and facilities by a producer which supplies to no more than twenty purchasers only such gas as is produced, gathered, or purchased by such producer within this state.

(H) Each public utility seeking authorization from the commission for the issuance of securities to finance the installation, construction, extension, or improvement of an air quality facility or advanced energy facility, as defined in section 3706.01 of the Revised Code, shall consider the availability of financing therefor from the Ohio air quality development authority and shall demonstrate to the commission that the proposed financing will be obtained on the best terms obtainable.

Sec. 4909.161.  (A) Notwithstanding the provisions of Chapters 4905. and 4909. of the Revised Code, the payment of any type of increased excise tax levy shall be considered to be a normal expense incurred by a public utility in the course of rendering service to the public, and may be recovered as such in accordance with an order of the public utilities commission. Any public utility required to pay any such increased excise tax levy may file with the public utilities commission revised rate schedules that will permit full recovery on an interim or permanent basis in its rates, of the amount of any resultant increased tax payments and the commission shall promptly act to approve such schedules.

(B) Notwithstanding Chapters 4905. and 4909. of the Revised Code, the payment of the kilowatt-hour tax imposed by section 5727.81 of the Revised Code shall be considered a normal expense incurred by an electric distribution utility, as defined in section 4928.01 of the Revised Code, in the course of rendering service to the public, and may be recovered as such in accordance with an order of the commission. An electric distribution utility required to pay the kilowatt-hour tax may file with the commission revised rate schedules, consistent with Chapters 4905. and 4909. and division (A)(6) of section 4928.34 of the Revised Code, that will permit full recovery on a permanent basis in its rates, of the amount of any resultant tax payments, after taking into account any reductions of taxes in its rates resulting from Sub. S.B. No. 3 of the 123rd general assembly, and the commission shall act promptly to approve those schedules.

Sec. 4928.01.  (A) As used in this chapter:

(1) "Ancillary service" means any function necessary to the provision of electric transmission or distribution service to a retail customer and includes, but is not limited to, scheduling, system control, and dispatch services; reactive supply from generation resources and voltage control service; reactive supply from transmission resources service; regulation service; frequency response service; energy imbalance service; operating reserve-spinning reserve service; operating reserve-supplemental reserve service; load following; back-up supply service; real-power loss replacement service; dynamic scheduling; system black start capability; and network stability service.

(2) "Billing and collection agent" means a fully independent agent, not affiliated with or otherwise controlled by an electric utility, electric services company, electric cooperative, or governmental aggregator subject to certification under section 4928.08 of the Revised Code, to the extent that the agent is under contract with such utility, company, cooperative, or aggregator solely to provide billing and collection for retail electric service on behalf of the utility company, cooperative, or aggregator.

(3) "Certified territory" means the certified territory established for an electric supplier under sections 4933.81 to 4933.90 of the Revised Code as amended by Sub. S.B. No. 3 of the 123rd general assembly.

(4) "Competitive retail electric service" means a component of retail electric service that is competitive as provided under division (B) of this section.

(5) "Electric cooperative" means a not-for-profit electric light company that both is or has been financed in whole or in part under the "Rural Electrification Act of 1936," 49 Stat. 1363, 7 U.S.C. 901, and owns or operates facilities in this state to generate, transmit, or distribute electricity, or a not-for-profit successor of such company.

(6) "Electric distribution utility" means an electric utility that supplies at least retail electric distribution service.

(7) "Electric light company" has the same meaning as in section 4905.03 of the Revised Code and includes an electric services company, but excludes any self-generator to the extent it consumes electricity it so produces or to the extent it sells for resale electricity it so produces.

(8) "Electric load center" has the same meaning as in section 4933.81 of the Revised Code.

(9) "Electric services company" means an electric light company that is engaged on a for-profit or not-for-profit basis in the business of supplying or arranging for the supply of only a competitive retail electric service in this state. "Electric services company" includes a power marketer, power broker, aggregator, or independent power producer but excludes an electric cooperative, municipal electric utility, governmental aggregator, or billing and collection agent.

(10) "Electric supplier" has the same meaning as in section 4933.81 of the Revised Code.

(11) "Electric utility" means an electric light company that is engaged on a for-profit basis in the business of supplying a noncompetitive retail electric service in this state or in the businesses of supplying both a noncompetitive and a competitive retail electric service in this state. "Electric utility" excludes a municipal electric utility or a billing and collection agent.

(12) "Firm electric service" means electric service other than nonfirm electric service.

(13) "Governmental aggregator" means a legislative authority of a municipal corporation, a board of township trustees, or a board of county commissioners acting as an aggregator for the provision of a competitive retail electric service under authority conferred under section 4928.20 of the Revised Code.

(14) A person acts "knowingly," regardless of the person's purpose, when the person is aware that the person's conduct will probably cause a certain result or will probably be of a certain nature. A person has knowledge of circumstances when the person is aware that such circumstances probably exist.

(15) "Level of funding for low-income customer energy efficiency programs provided through electric utility rates" means the level of funds specifically included in an electric utility's rates on October 5, 1999, pursuant to an order of the public utilities commission issued under Chapter 4905. or 4909. of the Revised Code and in effect on October 4, 1999, for the purpose of improving the energy efficiency of housing for the utility's low-income customers. The term excludes the level of any such funds committed to a specific nonprofit organization or organizations pursuant to a stipulation or contract.

(16) "Low-income customer assistance programs" means the percentage of income payment plan program, the home energy assistance program, the home weatherization assistance program, and the targeted energy efficiency and weatherization program.

(17) "Market development period" for an electric utility means the period of time beginning on the starting date of competitive retail electric service and ending on the applicable date for that utility as specified in section 4928.40 of the Revised Code, irrespective of whether the utility applies to receive transition revenues under this chapter.

(18) "Market power" means the ability to impose on customers a sustained price for a product or service above the price that would prevail in a competitive market.

(19)(18) "Mercantile commercial customer" means a commercial or industrial customer if the electricity consumed is for nonresidential use and the customer consumes more than seven hundred thousand kilowatt hours per year or is part of a national account involving multiple facilities in one or more states.

(20)(19) "Municipal electric utility" means a municipal corporation that owns or operates facilities to generate, transmit, or distribute electricity.

(21)(20) "Noncompetitive retail electric service" means a component of retail electric service that is noncompetitive as provided under division (B) of this section.

(22) "Nonfirm electric service" means electric service provided pursuant to a schedule filed under section 4905.30 of the Revised Code or pursuant to an arrangement under section 4905.31 of the Revised Code, which schedule or arrangement includes conditions that may require the customer to curtail or interrupt electric usage during nonemergency circumstances upon notification by an electric utility.

(23)(21) "Percentage of income payment plan arrears" means funds eligible for collection through the percentage of income payment plan rider, but uncollected as of July 1, 2000.

(24)(22) "Person" has the same meaning as in section 1.59 of the Revised Code.

(25)(23) "Advanced energy project" means any technologies, products, activities, or management practices or strategies that facilitate the generation or use of electricity and that reduce or support the reduction of energy consumption or support the production of clean, renewable energy for industrial, distribution, commercial, institutional, governmental, research, not-for-profit, or residential energy users. Such energy includes, but is not limited to, wind power; geothermal energy; solar thermal energy; and energy produced by micro turbines in distributed generation applications with high electric efficiencies, by combined heat and power applications, by fuel cells powered by hydrogen derived from wind, solar, biomass, hydroelectric, landfill gas, or geothermal sources, or by solar electric generation, landfill gas, or hydroelectric generation.

(26) "Regulatory assets" means the unamortized net regulatory assets that are capitalized or deferred on the regulatory books of the electric utility, pursuant to an order or practice of the public utilities commission or pursuant to generally accepted accounting principles as a result of a prior commission rate-making decision, and that would otherwise have been charged to expense as incurred or would not have been capitalized or otherwise deferred for future regulatory consideration absent commission action. "Regulatory assets" includes, but is not limited to, all deferred demand-side management costs; all deferred percentage of income payment plan arrears; post-in-service capitalized charges and assets recognized in connection with statement of financial accounting standards no. 109 (receivables from customers for income taxes); future nuclear decommissioning costs and fuel disposal costs as those costs have been determined by the commission in the electric utility's most recent rate or accounting application proceeding addressing such costs; the undepreciated costs of safety and radiation control equipment on nuclear generating plants owned or leased by an electric utility; and fuel costs currently deferred pursuant to the terms of one or more settlement agreements approved by the commission.

(27)(24) "Retail electric service" means any service involved in supplying or arranging for the supply of electricity to ultimate consumers in this state, from the point of generation to the point of consumption. For the purposes of this chapter, retail electric service includes one or more of the following "service components": generation service, aggregation service, power marketing service, power brokerage service, transmission service, distribution service, ancillary service, metering service, and billing and collection service.

(28) "Small electric generation facility" means an electric generation plant and associated facilities designed for, or capable of, operation at a capacity of less than two megawatts.

(29)(25) "Starting date of competitive retail electric service" means January 1, 2001, except as provided in division (C) of this section.

(30)(26) "Customer-generator" means a user of a net metering system.

(31)(27) "Net metering" means measuring the difference in an applicable billing period between the electricity supplied by an electric service provider and the electricity generated by a customer-generator that is fed back to the electric service provider.

(32)(28) "Net metering system" means a facility for the production of electrical energy that does all of the following:

(a) Uses as its fuel either solar, wind, biomass, landfill gas, or hydropower, or uses a microturbine or a fuel cell;

(b) Is located on a customer-generator's premises;

(c) Operates in parallel with the electric utility's transmission and distribution facilities;

(d) Is intended primarily to offset part or all of the customer-generator's requirements for electricity.

(33)(29) "Self-generator" means an entity in this state that owns an electric generation facility that produces electricity primarily for the owner's consumption and that may provide any such excess electricity to retail electric service providers, whether the facility is installed or operated by the owner or by an agent under a contract.

(B) For the purposes of this chapter, a retail electric service component shall be deemed a competitive retail electric service if the service component is competitive pursuant to a declaration by a provision of the Revised Code or pursuant to an order of the public utilities commission authorized under division (A) of section 4928.04 of the Revised Code. Otherwise, the service component shall be deemed a noncompetitive retail electric service.

(C) Prior to January 1, 2001, and after application by an electric utility, notice, and an opportunity to be heard, the public utilities commission may issue an order delaying the January 1, 2001, starting date of competitive retail electric service for the electric utility for a specified number of days not to exceed six months, but only for extreme technical conditions precluding the start of competitive retail electric service on January 1, 2001.

Sec. 4928.02.  It is the policy of this state to do the following throughout this state beginning on the starting date of competitive retail electric service:

(A) Ensure the availability to consumers of adequate, reliable, safe, efficient, nondiscriminatory, and reasonably priced retail electric service;

(B) Ensure the availability of unbundled and comparable retail electric service that provides consumers with the supplier, price, terms, conditions, and quality options they elect to meet their respective needs;

(C) Ensure diversity of electricity supplies and suppliers, by giving consumers effective choices over the selection of those supplies and suppliers and by encouraging the development of distributed and small generation facilities;

(D) Encourage innovation and market access for cost-effective supply- and demand-side retail electric service including, but not limited to, demand-side management, time-differentiated pricing, and implementation of advanced metering infrastructure;

(E) Encourage cost-effective and efficient access to information regarding the operation of the transmission and distribution systems of electric utilities in order to promote both effective customer choice of retail electric service and the development of performance standards and targets for service quality for all consumers, including annual achievement reports written in plain language;

(F) Ensure that an electric utility's transmission and distribution systems are available to a customer-generator or owner of distributed generation, so that the customer-generator or owner can market and deliver the electricity it produces;

(G) Recognize the continuing emergence of competitive electricity markets through the development and implementation of flexible regulatory treatment;

(G)(H) Ensure effective competition in the provision of retail electric service by avoiding anticompetitive subsidies flowing from a noncompetitive retail electric service to a competitive retail electric service or to a product or service other than retail electric service, and vice versa;

(H)(I) Ensure retail electric service consumers just and reasonable rates and protection against unreasonable sales practices, market deficiencies, and market power;

(I)(J) Preclude imbalances in knowledge and expertise among parties in a proceeding under this chapter to eliminate any appearance of disproportionate influence by any of those parties;

(K) Ensure that consumers and shareholders share the benefits of electric utility investment in facilities supplying retail electric generation service;

(L) Provide coherent, transparent means of giving appropriate incentives to technologies that can adapt successfully to potential environmental mandates;

(M) Protect at-risk populations when considering the implementation of any new advanced energy technology;

(N) Encourage implementation of distributed generation across customer classes through regular review and updating of rules governing critical issues such as, but not limited to, interconnection standards, standby charges, and net metering;

(O) Encourage the education of small business owners in this state regarding the use of, and encourage the use of, energy efficiency programs and advanced energy technologies in their businesses;

(P) Facilitate the state's effectiveness in the global economy.

In carrying out this policy, the commission shall consider rules as they apply to the costs of distribution infrastructure, including, but not limited to, line extensions for the purpose of development in this state.

Sec. 4928.05.  (A)(1)(a) On and after the starting date of competitive retail electric service, a competitive retail electric service supplied by an electric utility or electric services company shall not be subject to supervision and regulation by a municipal corporation under Chapter 743. of the Revised Code or by the public utilities commission under Chapters 4901. to 4909., 4933., 4935., and 4963. of the Revised Code, except section sections 4905.10 and 4905.31, division (B) of section 4905.33, and sections 4905.35 and 4933.81 to 4933.90; except sections 4905.06, 4935.03, 4963.40, and 4963.41 of the Revised Code only to the extent related to service reliability and public safety; and except as otherwise provided in this chapter. The commission's authority to enforce those excepted provisions with respect to a competitive retail electric service shall be such authority as is provided for their enforcement under Chapters 4901. to 4909., 4933., 4935., and 4963. of the Revised Code and this chapter.

(b) Notwithstanding division (A)(1)(a) of this section, the commission may so supervise and regulate competitive retail electric service provided to consumers by an electric utility in this state if the commission determines the supervision and regulation is necessary to implement the state policy specified in section 4928.02 of the Revised Code.

(c) On and after the starting date of competitive retail electric service, a competitive retail electric service supplied by an electric cooperative shall not be subject to supervision and regulation by the commission under Chapters 4901. to 4909., 4933., 4935., and 4963. of the Revised Code, except as otherwise expressly provided in sections 4928.01 to 4928.10 and 4928.16 of the Revised Code.

(2) On and after the starting date of competitive retail electric service, a noncompetitive retail electric service supplied by an electric utility shall be subject to supervision and regulation by the commission under Chapters 4901. to 4909., 4933., 4935., and 4963. of the Revised Code and this chapter, to the extent that authority is not preempted by federal law. The commission's authority to enforce those provisions with respect to a noncompetitive retail electric service shall be the authority provided under those chapters and this chapter, to the extent the authority is not preempted by federal law.

The commission shall exercise its jurisdiction with respect to the delivery of electricity by an electric utility in this state on or after the starting date of competitive retail electric service so as to ensure that no aspect of the delivery of electricity by the utility to consumers in this state that consists of a noncompetitive retail electric service is unregulated.

On and after that starting date, a noncompetitive retail electric service supplied by an electric cooperative shall not be subject to supervision and regulation by the commission under Chapters 4901. to 4909., 4933., 4935., and 4963. of the Revised Code, except sections 4933.81 to 4933.90 and 4935.03 of the Revised Code. The commission's authority to enforce those excepted sections with respect to a noncompetitive retail electric service of an electric cooperative shall be such authority as is provided for their enforcement under Chapters 4933. and 4935. of the Revised Code.

(B) Nothing in this chapter affects the authority of the commission under Title XLIX of the Revised Code to regulate an electric light company in this state or an electric service supplied in this state prior to the starting date of competitive retail electric service.

Sec. 4928.06.  (A) Beginning on the starting date of competitive retail electric service, the public utilities commission shall ensure that the policy specified in section 4928.02 of the Revised Code is effectuated. To the extent necessary, the commission shall adopt rules to carry out this chapter. Initial rules necessary for the commencement of the competitive retail electric service under this chapter shall be adopted within one hundred eighty days after the effective date of this section. Except as otherwise provided in this chapter, the proceedings and orders of the commission under the chapter shall be subject to and governed by Chapter 4903. of the Revised Code.

(B) If the commission determines, on or after the starting date of competitive retail electric service, that there is a decline or loss of effective competition with respect to a competitive retail electric service of an electric utility, which service was declared competitive by commission order issued pursuant to division (A) of section 4928.04 of the Revised Code, the commission shall ensure that that service is provided at compensatory, fair, and nondiscriminatory prices and terms and conditions.

(C) In addition to its authority under section 4928.04 of the Revised Code and divisions (A) and (B) of this section, the commission, on an ongoing basis, shall monitor and evaluate the provision of retail electric service in this state for the purpose of discerning any noncompetitive retail electric service that should be available on a competitive basis on or after the starting date of competitive retail electric service pursuant to a declaration in the Revised Code, and for the purpose of discerning any competitive retail electric service that is no longer subject to effective competition on or after that date. Upon such evaluation, the commission periodically shall report its findings and any recommendations for legislation to the standing committees of both houses of the general assembly that have primary jurisdiction regarding public utility legislation. Until 2008, the commission and the consumer's counsel also shall provide biennial reports to those standing committees, regarding the effectiveness of competition in the supply of competitive retail electric services in this state. In addition, until the end of all market development periods as determined by the commission under section 4928.40 of the Revised Code, those standing committees shall meet at least biennially to consider the effect on this state of electric service restructuring and to receive reports from the commission, consumers' counsel, and director of development.

(D) In determining, for purposes of division (B) or (C) of this section, whether there is effective competition in the provision of a retail electric service or reasonably available alternatives for that service, the commission shall consider factors including, but not limited to, all of the following:

(1) The number and size of alternative providers of that service;

(2) The extent to which the service is available from alternative suppliers in the relevant market;

(3) The ability of alternative suppliers to make functionally equivalent or substitute services readily available at competitive prices, terms, and conditions;

(4) Other indicators of market power, which may include market share, growth in market share, ease of entry, and the affiliation of suppliers of services.

The burden of proof shall be on any entity requesting, under division (B) or (C) of this section, a determination by the commission of the existence of or a lack of effective competition or reasonably available alternatives.

(E)(1) Beginning on the starting date of competitive retail electric service, the commission has authority under Chapters 4901. to 4909. of the Revised Code, and shall exercise that authority, to resolve abuses of market power by any electric utility that interfere with effective competition in the provision of retail electric service.

(2) In addition to the commission's authority under division (E)(1) of this section, the commission, beginning the first year after the market development period of a particular electric utility and after reasonable notice and opportunity for hearing, may take such measures within a transmission constrained area in the utility's certified territory as are necessary to ensure that retail electric generation service is provided at reasonable rates within that area. The commission may exercise this authority only upon findings that an electric utility is or has engaged in the abuse of market power and that that abuse is not adequately mitigated by rules and practices of any independent transmission entity controlling the transmission facilities. Any such measure shall be taken only to the extent necessary to protect customers in the area from the particular abuse of market power and to the extent the commission's authority is not preempted by federal law. The measure shall remain in effect until the commission, after reasonable notice and opportunity for hearing, determines that the particular abuse of market power has been mitigated.

(F) An electric utility, electric services company, electric cooperative, or governmental aggregator subject to certification under section 4928.08 of the Revised Code shall provide the commission with such information, regarding a competitive retail electric service for which it is subject to certification, as the commission considers necessary to carry out this chapter. An electric utility shall provide the commission with such information as the commission considers necessary to carry out divisions (B) to (E) of this section. The commission shall take such measures as it considers necessary to protect the confidentiality of any such information.

The commission shall require each electric utility to file with the commission on and after the starting date of competitive retail electric service an annual report of its intrastate gross receipts and sales of kilowatt hours of electricity, and shall require each electric services company, electric cooperative, and governmental aggregator subject to certification to file an annual report on and after that starting date of such receipts and sales from the provision of those retail electric services for which it is subject to certification. For the purpose of the reports, sales of kilowatt hours of electricity are deemed to occur at the meter of the retail customer.

Sec. 4928.111.  An electric distribution utility for which a standard service offer consisting of an electric security plan under section 4928.14 of the Revised Code has been approved by the public utilities commission shall file with the commission a long-term energy delivery infrastructure modernization plan or any plan providing for the utility's recovery of costs and a just and reasonable rate of return on such infrastructure modernization. A plan shall specify the initiatives the utility shall take to improve electric service reliability by rebuilding, upgrading, or replacing the utility's distribution system. The plan shall be filed under an application under section 4909.18 of the Revised Code.

Sec. 4928.12.  (A) Except as otherwise provided in sections 4928.31 to 4928.40 of the Revised Code, no No entity shall own or control transmission facilities as defined under federal law and located in this state on or after the starting date of competitive retail electric service unless that entity is a member of, and transfers control of those facilities to, one or more qualifying transmission entities, as described in division (B) of this section, that are operational.

(B) An entity that owns or controls transmission facilities located in this state complies with division (A) of this section if each transmission entity of which it is a member meets all of the following specifications:

(1) The transmission entity is approved by the federal energy regulatory commission.

(2) The transmission entity effects separate control of transmission facilities from control of generation facilities.

(3) The transmission entity implements, to the extent reasonably possible, policies and procedures designed to minimize pancaked transmission rates within this state.

(4) The transmission entity improves service reliability within this state.

(5) The transmission entity achieves the objectives of an open and competitive electric generation marketplace, elimination of barriers to market entry, and preclusion of control of bottleneck electric transmission facilities in the provision of retail electric service.

(6) The transmission entity is of sufficient scope or otherwise operates to substantially increase economical supply options for consumers.

(7) The governance structure or control of the transmission entity is independent of the users of the transmission facilities, and no member of its board of directors has an affiliation, with such a user or with an affiliate of a user during the member's tenure on the board, such as to unduly affect the transmission entity's performance. For the purpose of division (B)(7) of this section, a "user" is any entity or affiliate of that entity that buys or sells electric energy in the transmission entity's region or in a neighboring region.

(8) The transmission entity operates under policies that promote positive performance designed to satisfy the electricity requirements of customers.

(9) The transmission entity is capable of maintaining real-time reliability of the electric transmission system, ensuring comparable and nondiscriminatory transmission access and necessary services, minimizing system congestion, and further addressing real or potential transmission constraints.

(C) To the extent that a transmission entity under division (A) of this section is authorized to build transmission facilities, that transmission entity has the powers provided in and is subject to sections 1723.01 to 1723.08 of the Revised Code.

(D) For the purpose of forming or participating in a regional regulatory oversight body or mechanism developed for any transmission entity under division (A) of this section that is of regional scope and operates within this state:

(1) The commission shall make joint investigations, hold joint hearings, within or outside this state, and issue joint or concurrent orders in conjunction or concurrence with any official or agency of any state or of the United States, whether in the holding of those investigations or hearings, or in the making of those orders, the commission is functioning under agreements or compacts between states, under the concurrent power of states to regulate interstate commerce, as an agency of the United States, or otherwise.

(2) The commission shall negotiate and enter into agreements or compacts with agencies of other states for cooperative regulatory efforts and for the enforcement of the respective state laws regarding the transmission entity.

(E) If a qualifying transmission entity is not operational as contemplated in division (A) of this section, division (A)(13) of section 4928.34 of the Revised Code, or division (G) of section 4928.35 of the Revised Code, the commission by rule or order shall take such measures or impose such requirements on all for-profit entities that own or control electric transmission facilities located in this state as the commission determines necessary and proper to achieve independent, nondiscriminatory operation of, and separate ownership and control of, such electric transmission facilities on or after the starting date of competitive retail electric service.

Sec. 4928.14.  (A) After its market development period, an An electric distribution utility in this state shall provide consumers, on a comparable and nondiscriminatory basis within its certified territory, a market-based standard service offer of all competitive retail electric services necessary to maintain essential electric service to consumers, including a firm supply of electric generation service. Such offer shall be filed with the public utilities commission under section 4909.18 of the Revised Code.

(B) After that market development period, each electric distribution utility also shall offer customers within its certified territory an option to purchase competitive retail electric service the price of which is determined through a competitive bidding process. Prior to January 1, 2004, the commission shall adopt rules concerning the conduct of the competitive bidding process, including the information requirements necessary for customers to choose this option and the requirements to evaluate qualified bidders. The commission may require that the competitive bidding process be reviewed by an independent third party. No generation supplier shall be prohibited from participating in the bidding process, provided that any winning bidder shall be considered a certified supplier for purposes of obligations to customers. At the election of the electric distribution utility, and approval of the commission, the competitive bidding option under this division may be used as the market-based standard offer required by division (A) of this section. The commission may determine at any time that a competitive bidding process is not required, if other means to accomplish generally the same option for customers is readily available in the market and a reasonable means for customer participation is developed.

(C) After the market development period, the (B) Beginning the first day of January of the calendar year that follows the scheduled expiration of an electric distribution utility's rate plan, the standard service offer of the utility, for the purpose of compliance with division (A) of this section, shall consist of all of the following:

(1) As to each customer class, the total charges to customers under that rate plan that are in effect, as filed with the commission, on the first day of February of that year of expiration, exclusive of any charges for transmission and distribution services;

(2) As to each customer class, any adjustments for costs that are incurred by the utility, the recovery of which are pursuant to an application authorized by the commission under the rate plan, and that go into effect on or after that first day of February and before that first day of January;

(3) As to each customer class, any adjustments for deferred costs authorized by commission order, to the extent not included under divisions (B)(1) and (2) of this section;

(4) As to the specific customer, any price applicable to that customer that was approved by commission order under section 4905.31 of the Revised Code issued prior to October 28, 2007, exclusive of the transmission and distribution service components of that price. As used in divisions (B) and (D)(2)(a) of this section, "rate plan" means the standard service offer order in effect on the effective date of the amendment of this section by S.B. 221 of the 127th general assembly.

(C) For the purpose of complying with division (A) of this section, beginning on the effective date of the amendment of this section by S.B. 221 of the 127th general assembly and pursuant to filing requirements the commission shall prescribe by rule, a utility may file an application for commission approval of a modified standard service offer. Upon that filing, the commission shall set the date and time for hearing, send written notice of the hearing to the utility, and publish notice of the hearing one time in a newspaper of general circulation in each county in the service area affected by the application.

(D)(1) Subject to division (D) of this section, a standard service offer proposed under division (C) of this section, and herein designated an electric security plan, shall adjust a utility's standard service offer relative to changes in one or more costs incurred by the utility to serve jurisdictional load in this state and specified in the application. An adjustment for a change in a capitalized cost shall also include a just and reasonable return on that cost. The amount of any adjustment under division (D) of this section shall be offset by any decrease in costs, excluding reductions in amoritization relating to costs recovered through a regulatory transition charge authorized by the commission as of February 1, 2008, and by any change in kilowatt-hours sold that are associated with serving jurisdictional load in this state. Costs, as determined by the commission, may include, but are not limited to, any of the following:

(a) Environmental compliance costs for one or more specified generating facilities, as determined by the commission, except those included under division (D)(1)(c) of this section;

(b) The cost of fuel for one or more specified generating facilities or of purchased power;

(c) The cost of construction of one or more new, specified generating facilities that, superseding Chapter 4906. of the Revised Code, the commission determines and certificates the need for as to the standard service offer on the basis of resource planning projections developed in accordance with policies and procedures the commission shall prescribe by rule; or the cost, in excess of two hundred fifty million dollars, of construction of an environmental retrofit to a specified, then-existing generating facility. A price adjustment for such a new facility or environmental retrofit shall be consistent with section 4909.15 of the Revised Code and consistent with section 4909.18 of the Revised Code as applicable; and, subject to such terms and conditions as the commission prescribes in an order issued under division (D)(6) of this section, shall be for the actual life of the facility.

(d) Operating, maintenance, and other costs, including taxes;

(e) Costs of investment in one or more specified generating facilities;

(f) Costs of providing standby and default service pursuant to divisions (A) and (H) of this section.

However, costs under division (D) of this section shall exclude forfeitures, administrative or civil penalties, fines, court costs, and attorney's fees associated with violations of or noncompliances with federal or any state's environmental laws or with facilities' permits.

A standard service offer that includes costs under division (D)(1)(a), (b), (d), (e), or (f) of this section may provide for automatic increases or decreases in the standard service offer price, but, in the case of a cost under division (D)(1)(d) of this section, only if the cost was outside of the utility's control or responsibility.

In the case of an advanced energy technology or facility under section 4928.142 of the Revised Code, the costs of which are included in a standard service offer as authorized under this division, the portion of the standard service offer price attributable to those costs shall be bypassable by a consumer that has exercised choice of supplier under section 4928.03 of the Revised Code, but bypassable only to the extent the commission determines that the advanced energy technology or facilities implemented by that supplier are comparable to that implemented by the utility, under section 4928.142 of the Revised Code as of the issuance of an order under division (D)(6) of this section, for the purpose of the utility's compliance with division (A) of section 4928.142 of the Revised Code.

(2)(a) For the purpose of a utility's initial application under division (D)(1) of this section, the adjustment for a particular cost shall be determined using a baseline measure of that cost as of the first day of February of the calendar year in which the utility's rate plan is scheduled to expire.

(b) If a utility continues to provide its standard service offer pursuant to an electric security plan, for any later such application by the utility, the baseline measure shall be the cost, and the associated kilowatt-hours sold, as determined under the utility's then-existing approved plan. With regard to a generating facility under division (D)(1)(c) of this section, associated decreases in cost and changes in kilowatt-hours sold shall include, but are not limited to, retirement of all or part of any other generating facility, the cost of which had been included in the utility's rate base prior to the effective date of the amendment of this section by Sub. S.B. 221 of the 127th general assembly or was included under division (D)(1)(c) or (e) of this section.

(3) A standard service offer under division (D)(1) of this section may specify the standard, factors, or methodology that the commission shall use for the purpose of division (E)(2)(c) of this section and within such timeframe as the commission specifies in its order under division (D)(6) of this section, if the utility later files an application pursuant to division (E) of this section.

(4) Regarding an application filed under division (D)(1) of this section by a utility that transferred all or part of its generating facilities to an affiliate of the utility and to the extent authorized by federal law, the commission may consider purchased power or other contracts or agreements between the utility and any of its affiliates or between the utility and the holding company owning or controlling the utility.

(5) For the purpose of division (D) of this section, if the utility has entered into a contract or agreement with an affiliate for the provision of a competitive retail electric service, the commission shall treat as a cost of the utility under the electric security plan the affiliate's costs of providing that service.

(6) The burden of proof under division (D)(6) of this section shall be on the utility. The commission by order may approve or modify and approve a standard service offer under division (D)(1) of this section if it finds both of the following:

(a) The offer and the prices it establishes are just and reasonable as to each customer class and are consistent with the policy specified in section 4928.02 of the Revised Code.

(b) The utility is in compliance with section 4928.141 of the Revised Code. In its order, the commission shall prescribe such requirements for the utility as the commission considers necessary for the utility to implement applicable objectives of the policy specified in section 4928.02 of the Revised Code. The order also may provide a schedule and the procedural and substantive terms and conditions for periodic commission review of the approved offer.

(E)(1) As authorized under this division, a standard service offer proposed under division (C) of this section, and herein designated a market rate option, shall require that the utility's standard service offer price be determined periodically through an open, competitive bidding process. Prior to the approval of such an offer under division (E)(2) of this section, the utility shall conduct such competitive bidding for the purpose of establishing the original price under the offer.

(2) The burden of proof under division (E)(2) of this section shall be on the utility. The commission by order shall approve or modify and approve the standard service offer under division (E)(1) of this section if the commission determines all of the following are met:

(a) The offer and the prices it establishes are just and reasonable as to each customer class and are consistent with the policy specified in section 4928.02 of the Revised Code.

(b) The utility is in compliance with section 4928.141 of the Revised Code.

(c) With respect to generation service, the relevant markets are subject to effective competition. For that purpose and except as otherwise provided under division (D)(3) of this section, the commission shall consider the factors prescribed in division (D) of section 4928.06 of the Revised Code and such other or additional factors as the commission may prescribe by rule. The commission shall prescribe by rule the methodology it will use to evaluate whether the effective competition standard under division (E)(2)(c) of this section is met.

(d) The standard service offer price for a customer class as determined under competitive bidding under division (E)(1) of this section is more favorable than, or at least comparable to, its price-to-compare for that class. That price-to-compare shall be the price that the commission shall determine for the comparable time period and in the manner of an electric security plan under division (D) of this section.

In its order, the commission shall prescribe such requirements for the utility as it considers necessary for the utility to implement applicable objectives of the policy specified in section 4928.02 of the Revised Code. The order also may provide the procedural and substantive terms and conditions for periodic commission review of the approved offer. That review shall provide for the reconciliation of the standard service offer price to ensure that the price is just and reasonable as to each customer class and consistent with the policy specified in section 4928.02 of the Revised Code.

(F) A utility's standard service offer approved under this section shall take effect on the date the commission shall specify in the approval order and, on that date, the newly approved offer shall supersede the prior standard service offer of the utility.

(G)(1) Nothing in this section precludes a utility for which a standard service offer under division (D) of this section has been approved by the commission in accordance with this section from later filing an application under division (E) of this section, or vice versa.

(2) The commission has no authority to require a utility, for which it has ever approved a market rate option standard service offer under division (E) of this section, to file an application under division (D) of this section.

(H) The failure of a supplier to provide retail electric generation service to customers within the certified territory of the electric distribution utility shall result in the supplier's customers, after reasonable notice, defaulting to the utility's standard service offer filed under division (A) of this section until the customer chooses an alternative supplier. A supplier is deemed under this division to have failed to provide such service if the commission finds, after reasonable notice and opportunity for hearing, that any of the following conditions are met:

(1) The supplier has defaulted on its contracts with customers, is in receivership, or has filed for bankruptcy.

(2) The supplier is no longer capable of providing the service.

(3) The supplier is unable to provide delivery to transmission or distribution facilities for such period of time as may be reasonably specified by commission rule adopted under division (A) of section 4928.06 of the Revised Code.

(4) The supplier's certification has been suspended, conditionally rescinded, or rescinded under division (D) of section 4928.08 of the Revised Code.

(I) Nothing in this section limits an electric distribution utility providing competitive retail electric service to electric load centers within the certified territory of another such utility.

Sec. 4928.141.  During a proceeding under section 4928.14 of the Revised Code and upon submission of an appropriate discovery request, an electric distribution utility shall make available to the requesting party every contract or agreement that is between the utility or any of its affiliates and a party to the proceeding, consumer, electric services company, or political subdivision and that is relevant to the proceeding, subject to such protection for proprietary or confidential information as is determined appropriate by the public utilities commission.

Sec. 4928.142. (A) Subject to division (B) of this section, an electric distribution utility by the end of 2025 shall provide a portion of the electricity supply required for its standard service offer under section 4928.14 of the Revised Code from advanced energy. That portion shall equal twenty-five per cent of the total number of kilowatt-hours of electricity supplied by the utility to any and all electric consumers whose electric load centers are located within the utility's certified territory. However, subject to division (B) of this section, nothing in this section precludes a utility from providing a greater percentage. The advanced energy supply shall be consistent with the following requirements:

(1) At least half of the advanced energy implemented by the utility by the end of 2025 shall be generated from sustainable resources as defined in section 3706.01 of the Revised Code and shall include solar power. The remainder shall be supplied from advanced energy facilities as defined in divisions (X)(1) to (4) of section 3706.01 of the Revised Code.

(2) At least half of the advanced energy implemented by the utility by the end of 2025 shall be met through facilities located in this state.

The utility shall comply with division (A) of this section in a manner that considers available technology, costs, job creation, and economic impacts. To be counted toward the utility's compliance with division (A) of this section, the on-site construction of an advanced energy technology or facility shall be initiated after the effective date of this section. Any such technology or facility that complies with that division shall be and remain counted toward the utility's compliance.

(B)(1) If the commission determines, after notice and hearing, that the utility has failed to comply with division (A) of this section, the commission shall issue an order requiring the utility to comply fully within such time as shall be specified in the order and shall specify in the order the process and schedule for verifying to the commission the utility's compliance with the order.

(2) Full compliance shall not be mandated under division (B)(1) of this section to the extent that the ratio between the blended advanced energy and nonadvanced energy price under this section in 2025 and the portion of that price attributable to nonadvanced energy exceeds one and three-hundredths.

(3) Only division (B)(2) of section 4928.16 of the Revised Code applies if the commission determines in an order issued under division (B)(1) of this section that the utility has failed to comply with division (A) of this section, or if the commission by order determines in a later proceeding and after notice and hearing that the utility has failed to comply with an order issued under division (B)(1) of this section.

(C)(1) The commission annually shall submit to the general assembly in accordance with section 101.68 of the Revised Code a report describing the compliance of electric distribution utilities with divisions (A) and (B) of this section and any interim goals or strategy for utility compliance with those divisions or for encouraging the use of advanced energy in supplying this state's electricity needs in a manner that considers available technology, costs, job creation, and economic impacts. The commission shall allow and consider public comments on the report prior to its submission to the general assembly. Nothing in the report shall be binding on any person, including any utility for the purpose of its compliance with division (A) of this section, or the enforcement of that provision under division (B) of this section.

(2) The governor, in consultation with the commission chair, shall appoint an advanced energy advisory committee. The committee shall examine available technology for and related timetables, goals, and costs of the advanced energy requirement under division (A) of this section and shall submit semiannually a report of its recommendations to the commission.

Sec. 4928.15.  (A) Except as otherwise provided in sections 4928.31 to 4928.40 of the Revised Code, no No electric utility shall supply noncompetitive retail electric distribution service in this state on or after the starting date of competitive retail electric service except pursuant to a schedule for that service that is consistent with the state policy specified in section 4928.02 of the Revised Code and filed with the public utilities commission under section 4909.18 of the Revised Code. The schedule shall provide that electric distribution service under the schedule is available to all consumers within the utility's certified territory and to any supplier to those consumers on a nondiscriminatory and comparable basis. Distribution service rates and charges under the schedule shall be established in accordance with Chapters 4905. and 4909. of the Revised Code. The schedule shall include an obligation to build distribution facilities when necessary to provide adequate distribution service, provided that a customer requesting that service may be required to pay all or part of the reasonable incremental cost of the new facilities, in accordance with rules, policy, precedents, or orders of the commission.

(B) Except as otherwise provided in sections 4928.31 to 4928.40 of the Revised Code and except as preempted by federal law, no electric utility shall supply the transmission service or ancillary service component of noncompetitive retail electric service in this state on or after the starting date of competitive retail electric service except pursuant to a schedule for that service component that is consistent with the state policy specified in section 4928.02 of the Revised Code and filed with the commission under section 4909.18 of the Revised Code. The schedule shall provide that transmission or ancillary service under the schedule is available to all consumers and to any supplier to those consumers on a nondiscriminatory and comparable basis. Service rates and charges under the schedule shall be established in accordance with Chapters 4905. and 4909. of the Revised Code.

(C) A self-generator shall have access to backup electricity supply from its competitive electric generation service provider at a rate to be determined by contract.

Sec. 4928.16.  (A)(1) The public utilities commission has jurisdiction under section 4905.26 of the Revised Code, upon complaint of any person or upon complaint or initiative of the commission on or after the starting date of competitive retail electric service, regarding the provision by an electric utility, electric services company, electric cooperative, or governmental aggregator subject to certification under section 4928.08 of the Revised Code of any service for which it is subject to certification.

(2) The commission also has jurisdiction under section 4905.26 of the Revised Code, upon complaint of any person or upon complaint or initiative of the commission on or after the starting date of competitive retail electric service, to determine whether an electric utility has violated or failed to comply with any provision of sections 4928.01 to 4928.15, any provision of divisions (A) to (D) of section 4928.35 of the Revised Code, or any rule or order adopted or issued under those sections; or whether an electric services company, electric cooperative, or governmental aggregator subject to certification under section 4928.08 of the Revised Code has violated or failed to comply with any provision of sections 4928.01 to 4928.10 of the Revised Code regarding a competitive retail electric service for which it is subject to certification or any rule or order adopted or issued under those sections.

(3) If a contract between a mercantile commercial customer and an electric services company states that the forum for a commercial dispute involving that company is through a certified commercial arbitration process, that process set forth in the contract and agreed to by the signatories shall be the exclusive forum unless all parties to the contract agree in writing to an amended process. The company shall notify the commission for informational purposes of all matters for which a contract remedy is invoked to resolve a dispute.

(4) The commission, by rule adopted pursuant to division (A) of section 4928.06 of the Revised Code, shall adopt alternative dispute resolution procedures for complaints by nonmercantile, nonresidential customers, including arbitration through a certified commercial arbitration process and at the commission. The commission also by such rule may adopt alternative dispute resolution procedures for complaints by residential customers.

(B) In addition to its authority under division (C) of section 4928.08 of the Revised Code and to any other remedies provided by law, the commission, after reasonable notice and opportunity for hearing in accordance with section 4905.26 of the Revised Code, may do any of the following:

(1) Order rescission of a contract, or restitution to customers including damages due to electric power fluctuations, in any complaint brought pursuant to division (A)(1) or (2) of this section;

(2) Order any remedy or forfeiture provided under sections 4905.54 to 4905.60 and 4905.64 of the Revised Code upon a finding under division (A)(2) of this section that the electric utility has violated or failed to comply with any provision of sections 4928.01 to 4928.15, any provision of divisions (A) to (D) of section 4928.35 of the Revised Code, or any rule or order adopted or issued under those sections. in addition, the commission may order any remedy provided under section 4905.22, 4905.37, or 4905.38 of the Revised Code if the violation or failure to comply by an electric utility related to the provision of a noncompetitive retail electric service.

(3) Order any remedy or forfeiture provided under sections 4905.54 to 4905.60 and 4905.64 of the Revised Code upon a finding under division (A)(2) of this section that the electric services company, electric cooperative, or governmental aggregator subject to certification under section 4928.08 of the Revised Code has violated or failed to comply, regarding a competitive retail electric service for which it is subject to certification, with any provision of sections 4928.01 to 4928.10 of the Revised Code or any rule or order adopted or issued under those sections.

(C)(1) In addition to the authority conferred under section 4911.15 of the Revised Code, the consumers' counsel may file a complaint under division (A)(1) or (2) of this section on behalf of residential consumers in this state or appear before the commission as a representative of those consumers pursuant to any complaint filed under division (A)(1) or (2) of this section.

(2) In addition to the authority conferred under section 4911.19 of the Revised Code, the consumers' counsel, upon reasonable grounds on and after the starting date of competitive retail electric service, may file with the commission under section 4905.26 of the Revised Code a complaint for discovery if the recipient of an inquiry under section 4911.19 of the Revised Code fails to provide a response within the time specified in that section.

(D) Section 4905.61 of the Revised Code applies to a violation by an electric utility of, or to a failure of an electric utility to comply with, any provision of sections 4928.01 to 4928.15, any provision of divisions (A) to (D) of section 4928.35 of the Revised Code, or any rule or order adopted or issued under those sections.

Sec. 4928.17.  (A) Except as otherwise provided in sections 4928.31 to 4928.40 section 4928.14 of the Revised Code and beginning on the starting date of competitive retail electric service, no electric utility shall engage in this state, either directly or through an affiliate, in the businesses of supplying a noncompetitive retail electric service and supplying a competitive retail electric service, or in the businesses of supplying a noncompetitive retail electric service and supplying a product or service other than retail electric service, unless the utility implements and operates under a corporate separation plan that is approved by the public utilities commission under this section, is consistent with the policy specified in section 4928.02 of the Revised Code, and achieves all of the following:

(1) The plan provides, at minimum, for the provision of the competitive retail electric service or the nonelectric product or service through a fully separated affiliate of the utility, and the plan includes separate accounting requirements, the code of conduct as ordered by the commission pursuant to a rule it shall adopt under division (A) of section 4928.06 of the Revised Code, and such other measures as are necessary to effectuate the policy specified in section 4928.02 of the Revised Code.

(2) The plan satisfies the public interest in preventing unfair competitive advantage and preventing the abuse of market power.

(3) The plan is sufficient to ensure that the utility will not extend any undue preference or advantage to any affiliate, division, or part of its own business engaged in the business of supplying the competitive retail electric service or nonelectric product or service, including, but not limited to, utility resources such as trucks, tools, office equipment, office space, supplies, customer and marketing information, advertising, billing and mailing systems, personnel, and training, without compensation based upon fully loaded embedded costs charged to the affiliate; and to ensure that any such affiliate, division, or part will not receive undue preference or advantage from any affiliate, division, or part of the business engaged in business of supplying the noncompetitive retail electric service. No such utility, affiliate, division, or part shall extend such undue preference. Notwithstanding any other division of this section, a utility's obligation under division (A)(3) of this section shall be effective January 1, 2000.

(B) The commission may approve, modify and approve, or disapprove a corporate separation plan filed with the commission under division (A) of this section. As part of the code of conduct required under division (A)(1) of this section, the commission shall adopt rules pursuant to division (A) of section 4928.06 of the Revised Code regarding corporate separation and procedures for plan filing and approval. The rules shall include limitations on affiliate practices solely for the purpose of maintaining a separation of the affiliate's business from the business of the utility to prevent unfair competitive advantage by virtue of that relationship. The rules also shall include an opportunity for any person having a real and substantial interest in the corporate separation plan to file specific objections to the plan and propose specific responses to issues raised in the objections, which objections and responses the commission shall address in its final order. Prior to commission approval of the plan, the commission shall afford a hearing upon those aspects of the plan that the commission determines reasonably require a hearing. The commission may reject and require refiling of a substantially inadequate plan under this section.

(C) The commission shall issue an order approving or modifying and approving a corporate separation plan under this section, to be effective on the date specified in the order, only upon findings that the plan reasonably complies with the requirements of division (A) of this section and will provide for ongoing compliance with the policy specified in section 4928.02 of the Revised Code. However, for good cause shown, the commission may issue an order approving or modifying and approving a corporate separation plan under this section that does not comply with division (A)(1) of this section but complies with such functional separation requirements as the commission authorizes to apply for an interim period prescribed in the order, upon a finding that such alternative plan will provide for ongoing compliance with the policy specified in section 4928.02 of the Revised Code.

(D) Any party may seek an amendment to a corporate separation plan approved under this section, and the commission, pursuant to a request from any party or on its own initiative, may order as it considers necessary the filing of an amended corporate separation plan to reflect changed circumstances.

(E) Notwithstanding section 4905.20, 4905.21, 4905.46, or 4905.48 of the Revised Code, an No electric utility may divest itself of shall sell or transfer any generating asset at any time facility it owns in whole or in part to any person without prior commission approval, subject to the provisions of Title XLIX of the Revised Code relating to the transfer of transmission, distribution, or ancillary service provided by such generating asset.

Sec. 4928.18.  (A) Notwithstanding division (D)(2)(a) of section 4909.15 of the Revised Code, nothing in this chapter prevents the public utilities commission from exercising its authority under Title XLIX of the Revised Code to protect customers of retail electric service supplied by an electric utility from any adverse effect of the utility's provision of a product or service other than retail electric service.

(B) The commission has jurisdiction under section 4905.26 of the Revised Code, upon complaint of any person or upon complaint or initiative of the commission on or after the starting date of competitive retail electric service, to determine whether an electric utility or its affiliate has violated any provision of section 4928.17 of the Revised Code or an order issued or rule adopted under that section. For this purpose, the commission may examine such books, accounts, or other records kept by an electric utility or its affiliate as may relate to the businesses for which corporate separation is required under section 4928.17 of the Revised Code, and may investigate such utility or affiliate operations as may relate to those businesses and investigate the interrelationship of those operations. Any such examination or investigation by the commission shall be governed by Chapter 4903. of the Revised Code.

(C) In addition to any remedies otherwise provided by law, the commission, regarding a determination of a violation pursuant to division (B) of this section, may do any of the following:

(1) Issue an order directing the utility or affiliate to comply;

(2) Modify an order as the commission finds reasonable and appropriate and order the utility or affiliate to comply with the modified order;

(3) Suspend or abrogate an order, in whole or in part;

(4) Issue an order that the utility or affiliate pay restitution to any person injured by the violation or failure to comply;

(D) In addition to any remedies otherwise provided by law, the commission, regarding a determination of a violation pursuant to division (B) of this section and commensurate with the severity of the violation, the source of the violation, any pattern of violations, or any monetary damages caused by the violation, may do either of the following:

(1) Impose a forfeiture on the utility or affiliate of up to twenty-five thousand dollars per day per violation. The recovery and deposit of any such forfeiture shall be subject to sections 4905.57 and 4905.59 of the Revised Code.

(2) Regarding a violation by an electric utility relating to a corporate separation plan involving competitive retail electric service, suspend or abrogate all or part of an order, to the extent it is in effect, authorizing an opportunity for the utility to receive transition revenues under a transition plan approved by the commission under section 4928.33 of the Revised Code prior to its repeal by S.B. 221 of the 127th general assembly.

Corporate separation under this section does not prohibit the common use of employee benefit plans, facilities, equipment, or employees, subject to proper accounting and the code of conduct ordered by the commission as provided in division (A)(1) of this section.

(E) Section 4905.61 of the Revised Code applies in the case of any violation of section 4928.17 of the Revised Code or of any rule adopted or order issued under that section.

Sec. 4928.20.  (A) The legislative authority of a municipal corporation may adopt an ordinance, or the board of township trustees of a township or the board of county commissioners of a county may adopt a resolution, under which, on or after the starting date of competitive retail electric service, it may aggregate in accordance with this section the retail electrical loads located, respectively, within the municipal corporation, township, or unincorporated area of the county and, for that purpose, may enter into service agreements to facilitate for those loads the sale and purchase of electricity. The legislative authority or board also may exercise such authority jointly with any other such legislative authority or board. For customers that are not mercantile commercial customers, an ordinance or resolution under this division shall specify whether the aggregation will occur only with the prior, affirmative consent of each person owning, occupying, controlling, or using an electric load center proposed to be aggregated or will occur automatically for all such persons pursuant to the opt-out requirements of division (D) of this section. The aggregation of mercantile commercial customers shall occur only with the prior, affirmative consent of each such person owning, occupying, controlling, or using an electric load center proposed to be aggregated. Nothing in this division, however, authorizes the aggregation of the retail electric loads of an electric load center, as defined in section 4933.81 of the Revised Code, that is located in the certified territory of a nonprofit electric supplier under sections 4933.81 to 4933.90 of the Revised Code or an electric load center served by transmission or distribution facilities of a municipal electric utility.

(B) If an ordinance or resolution adopted under division (A) of this section specifies that aggregation of customers that are not mercantile commercial customers will occur automatically as described in that division, the ordinance or resolution shall direct the board of elections to submit the question of the authority to aggregate to the electors of the respective municipal corporation, township, or unincorporated area of a county at a special election on the day of the next primary or general election in the municipal corporation, township, or county. The legislative authority or board shall certify a copy of the ordinance or resolution to the board of elections not less than seventy-five days before the day of the special election. No ordinance or resolution adopted under division (A) of this section that provides for an election under this division shall take effect unless approved by a majority of the electors voting upon the ordinance or resolution at the election held pursuant to this division.

(C) Upon the applicable requisite authority under divisions (A) and (B) of this section, the legislative authority or board shall develop a plan of operation and governance for the aggregation program so authorized. Before adopting a plan under this division, the legislative authority or board shall hold at least two public hearings on the plan. Before the first hearing, the legislative authority or board shall publish notice of the hearings once a week for two consecutive weeks in a newspaper of general circulation in the jurisdiction. The notice shall summarize the plan and state the date, time, and location of each hearing.

(D) No legislative authority or board, pursuant to an ordinance or resolution under divisions (A) and (B) of this section that provides for automatic aggregation of customers that are not mercantile commercial customers as described in division (A) of this section, shall aggregate the electrical load of any electric load center located within its jurisdiction unless it in advance clearly discloses to the person owning, occupying, controlling, or using the load center that the person will be enrolled automatically in the aggregation program and will remain so enrolled unless the person affirmatively elects by a stated procedure not to be so enrolled. The disclosure shall state prominently the rates, charges, and other terms and conditions of enrollment. The stated procedure shall allow any person enrolled in the aggregation program the opportunity to opt out of the program up to every two four years, without paying a switching fee. Any such person that opts out of the aggregation program pursuant to the stated procedure shall default to the standard service offer provided under division (A) of section 4928.14 or division (D) of section 4928.35 of the Revised Code until the person chooses an alternative supplier.

(E)(1) With respect to a governmental aggregation for a municipal corporation that is authorized pursuant to divisions (A) to (D) of this section, resolutions may be proposed by initiative or referendum petitions in accordance with sections 731.28 to 731.41 of the Revised Code.

(2) With respect to a governmental aggregation for a township or the unincorporated area of a county, which aggregation is authorized pursuant to divisions (A) to (D) of this section, resolutions may be proposed by initiative or referendum petitions in accordance with sections 731.28 to 731.40 of the Revised Code, except that:

(a) The petitions shall be filed, respectively, with the township fiscal officer or the board of county commissioners, who shall perform those duties imposed under those sections upon the city auditor or village clerk.

(b) The petitions shall contain the signatures of not less than ten per cent of the total number of electors in, respectively, the township or the unincorporated area of the county who voted for the office of governor at the preceding general election for that office in that area.

(F) A governmental aggregator under division (A) of this section is not a public utility engaging in the wholesale purchase and resale of electricity, and provision of the aggregated service is not a wholesale utility transaction. A governmental aggregator shall be subject to supervision and regulation by the public utilities commission only to the extent of any competitive retail electric service it provides and commission authority under this chapter.

(G) This section does not apply in the case of a municipal corporation that supplies such aggregated service to electric load centers to which its municipal electric utility also supplies a noncompetitive retail electric service through transmission or distribution facilities the utility singly or jointly owns or operates.

(H) A governmental aggregator shall not include in its aggregation the accounts of any of the following:

(1) A customer that has opted out of the aggregation;

(2) A customer in contract with a certified competitive retail electric services provider;

(3) A customer that has a special contract with an electric distribution utility;

(4) A customer that is not located within the governmental aggregator's governmental boundaries;

(5) Subject to division (C) of section 4928.21 of the Revised Code, a customer who appears on the "do not aggregate" list maintained under that section.

Sec. 4928.21.  (A) A customer that desires to remove itself from the pool of customers eligible to participate in governmental aggregation under section 4928.20 of the Revised Code may register with the public utilities commission to appear on the "do not aggregate" list.

(B) The commission, by rule, shall establish a "do not aggregate" list. The commission shall maintain the "do not aggregate" list and make it publicly available on the commission's web site.

(C) If a customer is enrolled in a governmental aggregation program at the time the customer first appears on the "do not aggregate" list, the governmental aggregator shall remove the customer from the program at the next two-year opt out opportunity that is available to the customer under division (D) of section 4928.20 of the Revised Code.

Sec. 4928.64.  The public utilities commission shall adopt rules to establish energy efficiency standards applicable to electric distribution utilities such that, by 2025, any such utility shall implement energy efficiency measures that will result in not less than twenty-five per cent of actual growth in electric load and not less than ten per cent of total peak demand being achieved through those measures. The rules shall include a requirement that an electric distribution utility provide a customer upon request with two years' consumption data in an accessible form. Additionally, the rules may provide for decoupling.

Sec. 4928.68.  The public utilities commission shall employ a federal energy advocate to monitor the activities of the federal energy regulatory commission and other federal agencies and advocate on behalf of the interests of retail electric service consumers in this state. The attorney general shall represent the advocate before the federal energy regulatory commission and other federal agencies. Among other duties assigned to the advocate by the commission, the advocate shall examine the value of the participation of this state's electric utilities in regional transmission organizations and submit a report to the public utilities commission on whether continued participation of those utilities is in the interest of those consumers.

Sec. 4928.69.  The public utilities commission shall adopt rules establishing greenhouse gas emission reporting requirements, including participation in the climate registry, and carbon control planning requirements for each electric generating facility located in this state that emits greenhouse gases, including facilities in operation on the effective date of this section.

Section 2.  That existing sections 122.41, 122.451, 3706.01, 3706.02, 3706.03, 3706.04, 3706.041, 3706.05, 3706.06, 3706.07, 3706.08, 3706.09, 3706.10, 3706.11, 3706.12, 3706.13, 3706.14, 3706.15, 3706.16, 3706.17, 3706.18, 4905.31, 4905.40, 4909.161, 4928.01, 4928.02, 4928.05, 4928.06, 4928.12, 4928.14, 4928.15, 4928.16, 4928.17, 4928.18, 4928.20, and 4928.21 and sections 4928.31, 4928.32, 4928.33, 4928.34, 4928.35, 4928.36, 4928.37, 4928.38, 4928.39, 4928.40, 4928.41, 4928.42, 4928.431, and 4928.44 of the Revised Code are hereby repealed.