Utah Code 79-6-408. Study of project entity asset intended for decommissioning
Current as of: 2024 | Check for updates
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(1) As used in this section:
Terms Used In Utah Code 79-6-408
- Assets: (1) The property comprising the estate of a deceased person, or (2) the property in a trust account.
- Clean: means minimizing adverse environmental impact and able to meet state standards for environmental quality. See Utah Code 79-6-102
- Contract: A legal written agreement that becomes binding when signed.
- Fair market value: The price at which an asset would change hands in a transaction between a willing, informed buyer and a willing, informed seller.
- Liabilities: The aggregate of all debts and other legal obligations of a particular person or legal entity.
- Office: means the Office of Energy Development created in Section
79-6-401 . See Utah Code 79-6-102 - State: when applied to the different parts of the United States, includes a state, district, or territory of the United States. See Utah Code 68-3-12.5
(1)(a) “Authority” means the Decommissioned Asset Disposition Authority, created in Section 79-6-407 .
(1)(b) “Fair market value” means the same as that term is defined in Section 79-6-407 .
(2) The authority, in consultation with the office, shall conduct a study to:
(2)(a) evaluate issues in regards to a state implementation plan as a result of issuing an alternative permit under Section 19-2-109.4 ;
(2)(b) establish the fair market value of an electrical generation facility that a project entity intends to decommission; and
(2)(c) evaluate the potential sale of the facility to new owners.
(3) In conducting the study described in this section, the authority shall contract or consult with independent professionals with expertise in:
(3)(a) areas relevant to environmental regulatory compliance and clean air act state implementation plan development, including:
(3)(a)(i) related electric generation capacity;
(3)(a)(ii) resource adequacy; and
(3)(a)(iii) economic development considerations; and
(3)(b) areas relevant to the valuation and disposition of electrical generation facilities, including:
(3)(b)(i) engineering;
(3)(b)(ii) environmental assessments;
(3)(b)(iii) energy economics;
(3)(b)(iv) water rights;
(3)(b)(v) mineral rights;
(3)(b)(vi) regulatory analysis;
(3)(b)(vii) financial analysis;
(3)(b)(viii) real estate valuation; and
(3)(b)(ix) legal analysis.
(4) The study described in Subsection (2) shall:
(4)(a) for the evaluation of issues in regards to a state implementation plan as a result of issuing an alternative permit under Section 19-2-109.4 , based on input from the Division of Air Quality and independent modeling, legal analysis, and economic analysis, evaluate:
(4)(a)(i) any technical deficiencies that could occur in a state implementation plan as a result of issuing an alternative permit; and
(4)(a)(ii) options for revising the state implementation plan to ensure that the continued operation of the power plants under an alternative permit will not jeopardize the state’s ability to meet federal air quality standards;
(4)(b) for the valuation of the project entity asset that a project entity intends to decommission, include:
(4)(b)(i) an assessment of all assets associated with the electrical generation facility, including real property, equipment, water rights, mineral rights, and any other associated assets;
(4)(b)(ii) an assessment of all financial assets and potential financial liabilities or risks related to the electrical generation facility intended for decommissioning;
(4)(b)(iii) an analysis of any encumbrances on the electrical generation facility;
(4)(b)(iv) the impact on valuation of an electrical generation facility related to the issuance of an alternative air quality permit under Section 19-2-109.4 ;
(4)(b)(v) a review of any potential effect a sale of the electrical generation facility would have on liabilities related to the electrical generation facility;
(4)(b)(vi) incorporation of any relevant local, regional, or national economic and market factors that may impact the fair market value; and
(4)(b)(vii) any other factors the authority considers relevant in establishing a fair market value for the electrical generation facility; and
(4)(c) to evaluate the issues surrounding a potential sale of the facility, include:
(4)(c)(i) potential purchase and sale agreement terms;
(4)(c)(ii) the necessary financial capability of a potential purchaser, including experience raising capital, access to capital, financial stability, and ability to provide security for obligations related to decommissioning, remediation, and other liabilities;
(4)(c)(iii) operational experience and capability of a potential purchaser, including experience operating electrical generation facilities, contracting history, and historical operating metrics;
(4)(c)(iv) permitting, regulatory compliance, and construction issues for continued operation of the facility;
(4)(c)(v) the likelihood that continued operation of the facility would impact other electrical generation facilities in the state;
(4)(c)(vi) the potential for continued operation of the facility to infringe on existing utility service territories;
(4)(c)(vii) the viability of alternative business models for continued operation of the facility;
(4)(c)(viii) potential community and regional impacts resulting from continued operation or the retirement of the facility; and
(4)(c)(ix) the potential for continued operation of the facility to interfere with the rights and interests of the project entity, the project entity’s members, power purchasers, bondholders, creditors, or other entities.
(5) In conducting the study described in Subsection (2), the project entity shall timely provide to the authority information related to the assets and potential liabilities of the electrical generation facility intended for decommissioning.
(6) The authority shall report the progress and results of the study to the Public Utilities, Energy, and Technology Interim Committee on or before November 30, 2024.