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Oregon Bulletin

February 1, 2012

 

Department of Energy
Chapter 330

Rule Caption: Eliminates certain alternative devices and modifies the eligibility criteria for some alternative energy devices.

Adm. Order No.: DOE 11-2011

Filed with Sec. of State: 12-16-2011

Certified to be Effective: 1-1-12

Notice Publication Date: 11-1-2011

Rules Adopted: 330-070-0029

Rules Amended: 330-070-0013, 330-070-0014, 330-070-0019, 330-070-0020, 330-070-0021, 330-070-0022, 330-070-0024, 330-070-0025, 330-070-0026, 330-070-0027, 330-070-0045, 330-070-0048, 330-070-0060, 330-070-0064, 330-070-0070, 330-070-0073, 330-070-0089, 330-070-0091, 330-070-0097

Subject: The rules amendments are for changes to the Residential Energy Tax Credit (RETC) rules. Rule changes eliminate alternative fuel vehicles and certain appliances , modify the appropriate level of incentive for eligible alternative energy devices, modify requirements for wind alternative energy devices and provide process rules for implementing a cap n tax credits for solar third party applications.

Rules Coordinator: Kathy Stuttaford—(503) 373-2127

330-070-0013

Definitions

For the purposes of Oregon Administrative Rules, Chapter 330, Division 70 the following definitions apply unless the context requires otherwise:

(1) “AED” – Alternative Energy Device.

(2) “Active Solar Heating” – A solar system that uses air or water that is moved by pumps or fans to collect, store and distribute the sun’s energy to a dwelling or part of a dwelling.

(3) “AHRI” – Air-Conditioning, Heating, and Refrigeration Institute.

(4) “Alternative Energy Device” (AED) – A device or system that reduces the amount of conventional energy used by a dwelling.

(a)     AEDs eligible for tax years prior to January 1, 2012 include, but are not limited to, systems that collect and use solar energy; ground source heat pump systems; certain energy-efficient appliances, energy-efficient heating, ventilating and air conditioning systems; premium efficiency biomass combustion devices, fuel cell systems; alternative fuel vehicles and related alternative fuel devices or wind devices that supply, offset or supplement electricity used for a dwelling or that supply electricity to a utility.

(b) AEDs eligible for tax years beginning on or after January 1, 2012 include, but are not limited to, systems that collect and use solar energy; ground source heat pump systems; energy-efficient heating and ventilation systems, premium efficiency biomass combustion devices, fuel cell systems; and wind devices that supply, offset or supplement electricity used for a dwelling or that supply electricity to a utility.

(5) “Alternative Fuel” – Electricity, natural gas, ethanol, methanol, propane, and any other fuel approved by the Director.

(6) “Alternative Fuel Device” –

(a)     Prior to January 1, 2012 an alternative fuel vehicle, equipment necessary to convert a vehicle to use an alternative fuel, or a fueling system necessary to operate an alternative fuel vehicle.

(b)    Beginning on January 1, 2012 a facility for mixing, storing, compressing or dispensing fuels for alternative fuel vehicles, and any other necessary and reasonable equipment.

(7) “Annual Fuel Utilization Efficiency” (AFUE) – An efficiency descriptor of the ratio of annual output energy to annual input energy as developed in accordance with the requirements of the U.S. Department of Energy 10 CFR Part 430.

(8) “Applicant” – A person who applies for a residential alternative energy device tax credit under this section, which may include:

(a) A person who files an Oregon tax return and applies for a residential alternative energy device tax credit under this section, or

(b) An Oregon Investor Owned Utility (IOU) as defined in ORS 757.005 or its subsidiaries and affiliated interests as defined in 757.015 that is designated by an applicant under (a) to receive the residential tax credit certificate for a qualifying alternative fuel device on behalf of that designated applicant.

(9) “ARI” – Air Conditioning and Refrigeration Institute.

(10) “ASHRAE” – American Society of Heating, Refrigerating and Air-Conditioning Engineers.

(11) “AWEA” – American Wind Energy Association.

(12) “Btu” – British Thermal Unit.

(13) “CEF” – Energy Factor for Combined Systems: A non-dimensional descriptor of efficiency for combined space and water heating systems during operation in the water-heating mode only. This part of the three-part rating (which also includes space heating efficiency and combined efficiency) takes into account the standby losses from the storage tank, if any. A higher energy factor denotes better efficiency. Testing is accomplished using the ANSI/ASHRAE 124 test method.

(14) “Coefficient of Performance” (COP) – The ratio calculated by dividing the usable output energy by the electrical input energy. Both energy values must be expressed in equivalent units.

(15) “Combined Annual Fuel Utilization Efficiency” (CAFUE) – The effective efficiency of the combined appliance in performing the function of space heating. A descriptor of efficiency for combined space and water heating systems during operation in the space heating mode only. This part of the three-part rating (which also includes water heating efficiency and combined efficiency) does not count standby losses from the storage tank, if any. A higher AFUE denotes better efficiency. Testing is accomplished using the ANSI/ASHRAE 124-1991 test method.

(16) “Consumer Disclosure” – A department approved form completed by the Tax Credit Certified Technician and provided to the buyer of AEDs, except for energy-efficient appliances and alternative fuel devices, including estimated energy savings of the AED, required conservation items, required maintenance, and freeze protection information.

(17) “Cost” – As defined in ORS 469.160.

(18) “Domestic Water Heating” – The heating of water used in a dwelling for bathing, clothes washing, dishwashing and other related functions.

(19) “Ductless Mini-split Heat Pump” – An air-source heat pump consisting of an outdoor unit connected directly to one or more indoor units where the refrigerant is condensed and conditioned air is delivered directly to the room or zone of a home rather than through a central air handler.

(20) “Dwelling” – means real or personal property inhabited as a principal or secondary residence. “Dwelling” includes, but is not limited to, a single-family residence and an individual unit within multiple unit residential housing.

(a) Principal residence is the dwelling owned by the applicant who on the date of the application has legal title to a dwelling, including the mortgagor under a duly recorded mortgage of real property, the trustor under a duly recorded deed of trust or a purchaser under a duly recorded contract for the purchase of real property, and who inhabits the dwelling for no fewer than 14 days in a calendar year.

(b) Secondary residence is a vacation or other dwelling owned by the applicant that is not the applicant’s principal residence.

(c) A dwelling does not include a motor home or recreational vehicle as defined in ORS 446.003.

(21) “Electric Load” – Appliance and lighting exclusive of any water or space heating use.

(22) “Energy Efficiency Ratio” (EER) – EER is calculated by dividing the cooling capacity in Btu per hour (Btu/hr) by the power input in watts at any given set of rating conditions, expressed in Btu/hr per watt.

(23) “Energy-Efficient Appliance” – Prior to January 1, 2012 a clothes washer, clothes dryer, water heater, refrigerator, dishwasher, space conditioning system, solar electric alternating current (AC) module, or any other major household appliance that has been certified by the department to have premium energy efficiency characteristics. On or after January 1, 2012 includes only emerging technologies, such as high-efficiency heat-pump water heaters for domestic hot water, for gas water heaters, ductless heat pumps, high-efficiency furnaces that are at least 95 percent efficient, instantaneous or tankless gas water heaters and heat-pumps, that exceed code as specified in these rules.

(24) “Energy Factor” (EF) – Energy Factor is the ratio of useful energy output from the water heater to the total amount of energy delivered to the water heater. EF is a metric used to compare relative efficiencies of water heaters. The higher the EF is, the more efficient the water heater. EF is determined by the DOE test procedure, Code of Federal Regulations, Title 10, Section 430.

(25) “Energy Yield Chart” – Chart approved by the department showing first year energy yield of an AED.

(26) “Energy Recovery Ventilator” (ERV) – A device or system designed and installed to provide balanced fresh air ventilation for homes with the ability to transfer energy from the outgoing air stream to the incoming air stream that is also capable of at least 30 percent Latent Recovery/Moisture Transfer (LRMT) at 32 degrees F when operating at the lowest fan speed.

(27) “EUI (FURNACE)” – The Energy Use Index for a furnace, used to determine its electric efficiency, and calculated by the following formula, with inputs derived from the appropriate values in the Air-Conditioning, Heating, and Refrigeration Institute (AHRI) Directory of Certified Efficiency Ratings for Heating and Water Heating Equipment: (3413 x EAE) / [(3413 x EAE) + (1,000,000 x EF)] ≤ 2.0 percent. EAE is the average annual auxiliary electrical energy consumption for a gas furnace in kilowatt-hours per year (kWh/yr). It is a measure of the total electrical energy supplied to a furnace during a one-year period. EF is the average annual fuel energy consumption for a gas furnace in millions of Btu’s per year (MMBtu/yr).

(28) “EUI (HERV)” – The Energy Use Index for an HRV or ERV, used to determine its electric efficiency, and calculated by dividing a model’s power consumption, in watts, by the net supply air delivered, in cubic feet per minute (cfm), while the unit is operating in the lowest speed for which performance data is provided in the Home Ventilating Institute (HVI) Directory.

(29) “FERC” – Federal Energy Regulatory Commission.

(30) “First Year Energy Yield” – Usable energy produced under average conditions by an AED in 12 consecutive months of continuous operation expressed in kWh. Usable energy is the gross energy contribution minus any parasitic energy used to operate the system.

(31) “Fuel Cell Stack” – The portion of a fuel cell system where the electrochemical reactions take place, generally consisting of an anode, an electrolyte, and a cathode and supporting systems bringing fuel to the stack and carrying away the electricity, electrochemical products and thermal energy generated.

(32) “Fuel Cell System” – A system for producing electricity electrochemically and non-reversibly, using a hydrogen rich fuel and oxygen, and producing an electric current, water, and thermal energy.

(33) “Ground Source Heat Pump” – A heating, ventilating and air-conditioning system, also known as a ground source heat pump, earth-coupled heat pump, geothermal heat pump or ground loop AED, that utilizes a subsurface closed loop heat exchanger to extract or reject heat to the earth.

(34) “Heat Recovery Ventilator” (HRV) – A device or system designed and installed to provide balanced fresh air ventilation for homes with the ability to transfer energy from the outgoing air stream to the incoming air stream.

(35) “Heating Season Performance Factor” (HSPF) – The total heating output of a heat pump during its normal annual usage period for heating divided by the total electric power input in watt-hours during the same period. HSPF is measured according to test procedures defined by AHRI in its Standard 210/240 as well as ASHRAE Standard 116 and the DOE Test Procedure in 10 CFR; Part 430, Appendix M (ARI, 2003).

(36) “HUD” – U.S. Department of Housing and Urban Development.

(37) “Hybrid Vehicle” – An alternative fuel vehicle that draws propulsion energy from on-board sources of stored energy that include both an internal combustion or heat engine and a rechargeable energy storage system.

(38) “Hydronic Space Heating System” – A system that uses hot or warm water to deliver heat from a boiler or water heater to the living spaces in a home.

(39) “Installed Output” – The rated capacity of a photovoltaic system measured in average alternating current watts for the purpose of determining the tax credit for systems installed on or after January 1, 2011 or before January 1, 2012. Installed output equals 0.7 multiplied by the rated direct current capacity as measured at standard test conditions.

(40) “IREC” – Interstate Renewable Energy Council.

(41) “kWh” – Kilowatt-hour; 1 kWh = 3413 BTU for purposes of department calculations.

(42) “Latent Recovery Moisture Transfer” (LRMT) – In an HRV or ERV, moisture recovered to the ventilation supply air stream divided by moisture being exhausted, corrected for cross leakage, if any. LRMT = 0 would indicate that no exhausting moisture is recovered for the incoming supply air stream. LRMT = 1 would indicate that all exhausting moisture is transferred.

(43) “MCFC” – Molten carbonate fuel cell.

(44) “Modified Energy Factor” (MEF) – The non-dimensional efficiency rating for clothes washers. This measure, unlike the EF, takes into account the moisture removed from the wash load in the spin cycle, thereby changing energy use in the drying cycle. A higher MEF denotes a more efficient clothes washer.

(45) “MM” – Million (Roman Numeral M = 1000, MxM = 1000 x 1000 = 1,000,000 or 106).

(46) “Net Generation” – The gross kWh produced minus internal losses and parasitic loads. The net generation includes both the amount of generation available to serve dwelling loads and to provide to a utility.

(47) “OG” – Operating guidelines developed by the Solar Rating and Certification Corporation (SRCC) including system performance or component characteristics defined by SRCC in its directory.

(48) “Owner-Built” – An AED that is assembled and installed on an owner’s property and with an owner’s labor only.

(49) “Parasitic Power” – The electrical energy the system uses to operate.

(50) “Passive” – A solar AED that relies on heated liquid or air rising to collect, store and move heat without mechanical devices.

(51) “Passive Solar Space Heating” – A system or building design that collects and stores solar energy received directly though south facing windows. The system/design is without powered moving parts and includes provisions to collect, store and distribute the sun’s energy using only convection, radiation and conduction of energy.

(52) “Pass-Through Amount” – The sum, equal to the present value of the credit, paid to an eligible AED owner in exchange for the right to claim the tax credit. The present value of the tax credit shall be determined periodically by the Director.

(53) “Pass-Through Partner” – An individual or business that pays the pass-through amount to an applicant and receives the tax credit in place of the applicant.

(54) “Pass-Through Verification” – A determination based on information collected by the department that the approved pass-through amount has been provided, that the applicant has relinquished any claim to the tax credit and has assigned the credit to the pass-through partner.

(55) “Peak Power Ratio” – The maximum power available from the electric motor of a hybrid vehicle providing propulsion energy when powered by the rechargeable energy storage system, divided by the total of such maximum power and the SAE net power of the internal combustion or heat engine.

(56) “Performance Checked Duct System”— A forced air duct system that has been tested for duct leakage by a tax credit certified technician using the department’s approved testing procedures, and that has been repaired or constructed for premium efficiency using the department’s approved materials to reduce duct air leakage. For purposes of the tax credit, performance checked duct systems are considered energy-efficient appliances.

(57) “Performance Checked Heat Pump or Air Conditioner” – A heat pump or air conditioner that has been tested and repaired or serviced for premium efficiency by a tax credit certified technician using department approved procedures to assure that refrigerant charge and system air flow are within ranges recommended by the equipment manufacturer. For purposes of the tax credit, performance tested heat pumps and air conditioners are considered energy-efficient appliances.

(58) “Premium Efficiency Biomass Combustion Device” – Any device that burns wood, compressed wood or other non-gaseous or non-liquid solid fuels of 100 percent organic origin for aesthetic or space-heating purposes.

(59) “PV System” – A complete solar electric power system capable of delivering power to either the main or sub-panel in a dwelling. Necessary components include solar electric modules, inverter, mounting system, and disconnection equipment.

(60) “Seasonal Energy Efficiency Ratio” (SEER) – A measure of the efficiency of a cooling system over the entire cooling season (cooling accomplished divided by power used), expressed in Btu/kWh.

(61) “Solar Attic Fan” – A device that uses photovoltaics to power a fan that pulls hot air out of an attic or roof space. Such a device may either be a complete, all-in-one unit or be comprised of a small photovoltaic panel and a DC powered attic fan designed to be run by photovoltaic panel.

(62) “Solar Domestic Water Heating System” – Any configuration of plumbing equipment and components to collect, convey, store and convert the sun’s energy for the purpose of heating water.

(63) “Solar Electric AC Module” – A solar photovoltaic module coupled with a utility interactive inverter. The combined system must be Underwriters Laboratory (UL) listed and meet all current Institute of Electronic and Electrical Engineers (IEEE) 929 requirements.

(64) “SRCC” – Solar Rating and Certification Corporation.

(65) “Sensible Recovery Efficiency” (SRE) – In an HRV or ERV, the measurable (sensible) energy recovered to the ventilation supply air stream minus supply fan and preheat coil energy use divided by the total sensible energy being exhausted plus exhaust fan energy. This measure of efficiency accounts for the effects of cross leakage between air streams, purchased energy for fan controls, and defrost system energy use.

(66) “Standard Test Conditions” (STC) – 25 degrees Celsius cell temperature and 1000 watts per square meter (W/m2).

(67) “Sunchart” – A chart or form issued or approved by the department, and completed, signed and dated by tax-credit certified technician showing the plotted path of the sun and any objects, including both plant life and structures, that block the sun from an AED. The viewpoint must be from the center of the lower edge of the collector, and must depict whether any plant life is made up of evergreen or leafy trees. A lack of shading on the AED must be indicated in writing on the chart.

(68) “System Certification” – Certification that an AED as described in an application for tax credit meets all criteria for the tax credit.

(69) “System Owner” – A person who owns the AED.

(70) “Tax-Credit Certified Technician” (TCCT) – A technician who has been approved by the department to implement the tax credit program. A tax-credit certified technician is responsible for assuring that AEDs are installed in accordance with the department’s rules and must verify system installation quality and performance.

(71) “Tax-Credit Listed Company” – A company that employs at least one tax-credit certified technician.

(72) “Third-party” – means the owner, or the owner’s representative, of the alternative energy device for the duration of the third-party agreement.

(73) “Third-party alternative energy device installation” – has the definition given in Oregon Laws 2011, chapter 730, section 70.

 (74) “Total Solar Resource Fraction” – The fraction of usable solar energy that is received by the solar panel/collector throughout the year, which accounts for impacts due to external shading, collector tilt and collector orientation.

(75) “Unconditioned Spaces” – An enclosed space within a building that is not a conditioned space or a semi-heated space such as attics, garages, and any space with an average ambient temperature of less than 55 degrees Fahrenheit during the heating season.

(76) “Used Equipment” – Any product or any piece of equipment not under a current manufacturer’s warranty or which has been acquired by a previous owner or user.

(77) “Wastewater Heat Recovery Device” – A device designed to recover thermal energy from household wastewater streams for the purpose of returning a portion of this energy to the dwelling’s hot water supply system.

(78) “Water Factor” (WF) – The measure of water efficiency in clothes washers, measured in gallons per cubic foot of tub capacity, per cycle (gal/ft3/cycle).

(79) “Wind AED” – A qualifying wind energy conversion system that uses wind to produce mechanical or electrical power or energy, including turbines, towers and their associated components needed to form a complete system.

Stat. Auth.: ORS 469.086

Stats. Implemented: ORS 316.116

Hist.: DOE 1-1982, f. 1-12-82, ef. 2-1-82; DOE 1-1986, f. & ef. 2-7-86; DOE 4-1987, f. 12-18-87, ef. 1-1-88, Renumbered from 330-070-0023; DOE 1-1989, f. & cert. ef. 6-15-89; DOE 2-1989, f. 12-28-89, cert. ef. 1-1-90; DOE 1-1995, f. & cert. ef. 1-17-95; DOE 1-1996, f. & cert. ef. 4-1-96; DOE 1-1997, f. 12-15-97, cert. ef. 1-1-98; DOE 1-1999, f. 12-21-99, cert. ef. 1-1-00; DOE 2-2000, f. 12-29-00, cert. ef. 1-1-01; DOE 2-2000, f. 12-29-00, cert. ef. 1-1-01; DOE 2-2001, f. 10-5-01, cert. ef. 10-8-01; DOE 1-2004, f. & cert. ef. 1-21-04; DOE 2-2005, f. 12-30-05, cert. ef. 1-1-06; DOE 4-2006, f. 12-29-06, cert. ef. 1-1-07; DOE 4-2007, f. 11-30-07, cert. ef. 12-1-07; DOE 7-2010(Temp), f. & cert. ef. 7-1-10 thru 12-28-10; DOE 16-2010, f. & cert. ef. 12-22-10; DOE 11-2011, f. 12-16-11, cert. ef. 1-1-12

330-070-0014

Pass-Through Eligibility

(1) Any person or business that pays the present value to purchase the approved tax credit from the applicant is eligible to claim the tax credit in place of the applicant.

(2) In accordance with ORS 469.170(10) the department establishes the following rates for calculating the present value of the tax credit:

(a) For tax credits greater than $1,500 when the pass-through partner is a business, the present value is 80 percent of the tax credit amount.

(b) For tax credits greater than $1,500 when the pass-through partner is a resident, the present value is 86 percent of the tax credit amount.

(c) For tax credits less than $1,500 the present value is 95 percent of the tax credit amount.

(3) The department will issue a credit to the pass through partner when the applicant confirms receipt of an equal amount to the present value of the tax credit and relinquishes any claim to the credit.

Stat. Auth.: ORS 469.040, 469.160 - 180 & 469.710 - 720

Stats. Implemented: ORS 469.040, 469.160 - 180 & 469.710 - 720

Hist.: DOE 2-2001, f. 10-5-01, cert. ef. 10-8-01; DOE 1-2004, f. & cert. ef. 1-21-04; DOE 2-2005, f. 12-30-05, cert. ef. 1-1-06; DOE 4-2007, f. 11-30-07, cert. ef. 12-1-07; DOE 16-2010, f. & cert. ef. 12-22-10; DOE 11-2011, f. 12-16-11, cert. ef. 1-1-12

330-070-0019

Cost

(1) Notwithstanding the definition in OAR 330-070-0013, an applicant who installed eligible AEDs on or after August 1, 2010 and prior to January 1, 2011, other than those under contract on or before August 13, 2010 and installed prior to January 1, 2011, must determine cost by calculating the amount the applicant paid for design, acquisition, building and installation of the AED, including permit and inspection fees. The cost must include the value of federal tax credits and utility incentives. Cost does not include service contracts, rebates, or refunds.

(2) An applicant:

(a) With an eligible AED installed prior to August 1, 2010 must clearly indicate on the application that the date of installation completion was prior to August 1, 2010; or

(b) With an eligible AED installed on or after August 1, 2010 and prior to December 31, 2010, who have a signed contract dated on or before August 13, 2010, must:

(A) Have provided a copy of the contract for the installation of an eligible AED to the department no later than 5:00 p.m. on Friday, August 27, 2010;

(B) Indicate on the application that the project was completed on or before December 31, 2010; and

(C) Provide the department evidence of the completed installation in the form of a copy of the approved final inspection, dated on or before December 31, 2010, as issued by the local jurisdiction.

(3) The department may grant an additional 15 days for project completion upon the written request of the applicant for good cause shown. The applicant must request the additional time in writing and explain the extenuating circumstances as to why the installation was not completed on or before December 31, 2010. Any project granted the additional time must be completed no later than Friday, January 14, 2011.

Stat. Auth.: ORS 469.160 - 469.180

Stats. Implemented: ORS 469.160.160 - 469.180

Hist.: DOE 10-2010(Temp), f. & cert. ef. 7-30-10 thru 1-24-11; DOE 16-2010, f. & cert. ef. 12-22-10; DOE 11-2011, f. 12-16-11, cert. ef. 1-1-12

330-070-0020

Eligibility

(1) To qualify for a credit, a person must:

(a) Have an income tax liability in Oregon; and

(b) Purchase an AED, complete construction and installation if applicable, and obtain a certification in accordance with OAR 330-070-0010 through 330-070-0097; and

(c) Be the owner or contract buyer of an Oregon dwelling served by the AED, or be a tenant of the dwelling owner; and

(A) Use the dwelling as a primary or secondary residence; or

(B) Rent or lease the dwelling to a tenant who uses the dwelling or dwellings as a principal or secondary residence.

(2) If the basis for the credit is the installation of an energy-efficient appliance, the credit shall be allowed only to the taxpayer who actually occupies the dwelling as a principal or secondary residence.

(3) If the basis for the credit is a fueling station necessary to operate an alternative fuel vehicle, unless the certificate is transferred, the company that constructs the dwelling that incorporates the fueling station or who installs the fueling station in the dwelling may claim the credit. If the alternative energy device is an alternative fuel vehicle or related equipment, the credit must be claimed by the system owner.

(4) Any person that pays the present value of the tax credit for a qualified alternative energy device to the person who originally purchases the device shall be entitled to claim the credit in place of the original credit owner.

(5) For a qualified vehicle owned by a lessor during the period of first use of a new vehicle, the lessor may pass-through the right to claim the credit to the lessee exercising the first new use.

(6) Notwithstanding (1)(b), a residential property owner may qualify for a credit of a third party alternative energy device installation by meeting the following additional requirements:

(a) Installations must include a minimum 10-year agreement between the residential property owner and the third party owner of the AED. The agreement must cover maintenance of the AED and either the use of the AED or the power generated by the AED for the entire length of the agreement.

(b) The third party must comply with OAR 330-070-0029.

(c) The applicant must provide system cost information for third-party AED installations. System cost can be demonstrated by providing either a copy of an invoice for the purchase of the AED by the third party, or a declaration of representative market value for an AED that includes the costs of supply and installation. Such a declaration must include a list of primary system components and their costs.

Stat. Auth.: ORS 469

Stats. Implemented: ORS 469.160

Hist.: DOE 12(Temp), f. & ef. 10-14-77; DOE 3-1978, f. & ef. 3-7-78; DOE 5-1978, f. & ef. 9-27-78; DOE 6-1979, f. & ef. 11-13-79; DOE 1-1982, f. 1-12-82, ef. 2-1-82; DOE 6-1983, f. 12-16-83, ef. 1-1-84; DOE 7-1984, f. & ef. 12-19-84; DOE 1-1986, f. & ef. 2-7-86; DOE 4-1987, f. 12-18-87, ef. 1-1-88; DOE 1-1997, f. 12-15-97, cert. ef. 1-1-98; DOE 1-1999, f. 12-21-99, cert. ef. 1-1-00; DOE 2-2001, f. 10-5-01, cert. ef. 10-8-01; DOE 1-2004, f. & cert. ef. 1-21-04; DOE 2-2005, f. 12-30-05, cert. ef. 1-1-06; DOE 4-2006, f. 12-29-06, cert. ef. 1-1-07; DOE 16-2010, f. & cert. ef. 12-22-10; DOE 11-2011, f. 12-16-11, cert. ef. 1-1-12

330-070-0021

Eligible Devices

(1) To earn a tax credit, an AED must:

(a) Be a complete system that is currently operating and meets these rules. Additions to existing AED systems, except for pool, spa, or hot tub systems, are eligible when those additions increase the energy production capacity and the kWh saved by the system;

(b) Be a system that is built, installed, and operated in accordance with ORS 469.160 through 469.180;

(c) Be a system with manufacturers’ warranties against defects in products and materials, including remanufactured equipment;

(d) Be a system that complies with general and specific standards in these rules as they apply to AED systems and be one of the following:

(A) A system that uses solar energy;

(B) A ground source heat pump;

(C) A renewable energy system that heats or cools space, heats water, or makes electricity;

(D) An energy-efficient appliance including a wastewater heat recovery device;

(E) An alternative fuel device; For tax years prior to January 1, 2012 this includes vehicles licensed and registered for first new use on Oregon roadways and used vehicles being modified for first new use of a qualifying alternative fuel device.

(F) A fuel cell system;

(G) For tax years prior to January 1, 2012 a heat pump water heater. Beginning January 1, 2012 only heat pump water heaters that meet the Northern Tier specification established by the Northwest Energy Efficiency Alliance for electricity will be eligible;

(H) A premium efficiency biomass combustion device;

(I) A ductless mini-split heat pump;.

(J) A Gas Furnace;

(K) A Heat and Energy Recovery Ventilator; or

(L) An Air Source Heat Pump.

(2) The following devices are not eligible for an AED tax credit:

(a) Standard efficiency furnaces;

(b) Standard backup heating systems;

(c) Wood stoves or wood furnaces, or any part of a heating system that burns wood except a qualifying premium efficiency biomass combustion device;

(d) Heat pump water heaters that are part of a geothermal heat pump space heating system;

(e) Structures that cover or enclose a swimming pool and are not attached to the dwelling;

(f) Swimming pools and hot tubs used to store heat;

(g) Photovoltaic systems installed on recreational vehicles;

(h) Additions to existing spa and hot tub systems;

(i) Above ground, un-insulated swimming pools, spas and hot tubs;

(j) Conversions of systems from one type to another. An example is a conversion of a draindown solar hot water system to a drainback solar hot water system;

(k) Used equipment, not including remanufactured equipment that meets program standards;

(l) Repairs and maintenance of systems having received prior certification for an AED tax credit;

(m) Water source heat pump: A system that uses surface or subsurface water in a single pass without recirculation (open loop);

(n) Hydro systems;

(o) Wind systems that are used to heat or cool buildings, or to heat domestic, swimming pool or hot tub water; and

(p) Renewable energy systems that received certification under the Business Energy Tax Credit program as Homebuilder Installed Renewable Energy Facilities or as part of a High Performance Home.(q) Air Conditioning Systems (effective January 1, 2012).(r) Boilers (effective January 1, 2012).

(s) Dishwashers (effective January 1, 2012).

(t) Refrigerators and Freezers (effective January 1, 2012).

(u) Clothes Washers and Dryers (effective January 1, 2012).

Stat. Auth.: ORS 469.086

Stats. Implemented: ORS 316.116

Hist.: DOE 1-1986, f. & ef. 2-7-86; DOE 4-1987, f. 12-18-87, ef. 1-1-88; DOE 1-1989, f. & cert. ef. 6-15-89; DOE 2-1989, f. 12-28-89, cert. ef. 1-1-90; DOE 1-1995, f. & cert. ef. 1-17-95; DOE 1-1996, f. & cert. ef. 4-1-96; DOE 1-1997, f. 12-15-97, cert. ef. 1-1-98; DOE 1-1999, f. 12-21-99, cert. ef. 1-1-00; DOE 2-2001, f. 10-5-01, cert. ef. 10-8-01; DOE 1-2004, f. & cert. ef. 1-21-04; DOE 2-2005, f. 12-30-05, cert. ef. 1-1-06; DOE 4-2007, f. 11-30-07, cert. ef. 12-1-07; DOE 16-2010, f. & cert. ef. 12-22-10; DOE 11-2011, f. 12-16-11, cert. ef. 1-1-12

330-070-0022

Amount of Tax Credit

(1) The amount of the AED tax credit is based on the first-year energy yield of an eligible AED. The energy yield basis for a solar tax credit may be adjusted by the department to account for less than optimal solar access.

(2) The amount of the AED tax credit shall not exceed the lesser of:

(a) $1,500 or the first-year energy yield of the AED in kWh multiplied by 60 cents for AEDs used for solar or geothermal space heating, cooling, or domestic water heating for tax years beginning on or after January 1, 1998. The amount of the credit may not exceed 100 percent of the cost of the system components and their installation. Only one tax credit for ground source heat pump systems will be issued per year per residence.

(b) For an alternative energy device used for swimming pool, spa or hot tub heating, the credit allowed must be based upon 50 percent of the cost of the device or the first year’s energy yield in kilowatt hours per year multiplied by 15 cents, whichever is lower, up to maximum credit amounts set in subsections (a) through (c) of this section.

(c) For each alternative fuel device, the credit allowed is 25 percent of the eligible cost of the alternative fuel device, not to exceed $750 for devices placed in service on or after January 1, 1998. Individual credit may be claimed for both an alternative fuel vehicle, if purchased before January 1, 2012, and an alternative fuel fueling system.

(A) Eligible cost is the difference in the cost between a conventional fueled vehicle of similar size with similar features and the cost of an alternative fuel vehicle and its charging or fueling systems.

(i) Conventional fuel vehicles manufactured by the same manufacturer with the same seating capacity and/or cab cubic volume or weight difference that are less than 20 percent, may be used to define eligible costs, provided that other features (upholstery, audio, suspension, body appointment) are similar.

(ii) Low-speed vehicles, as defined under ORS 801.331 (2009 Oregon Vehicle Code) and alternative fuel vehicles capable of using E-85 and gasoline (flex-fuel vehicles) are not eligible for a tax credit.

(d) For fuel cell systems placed in service on or after January 1, 2007, one tax credit may be issued per year per residence based on the first-year energy yield of the AED in kWh multiplied by 60 cents, not to exceed $6,000 and not to exceed 50 percent of the cost of the system. The maximum credit claimed per year will not exceed $1,500.

(e) For photovoltaic systems installed on or after November 4, 2005, one $6,000 tax credit per year per residence for four years ($1,500 per year) not to exceed 50 percent of the cost of the system as defined in OAR 330-070-0022(4).

(f) For wind AEDs installed on or after January 1, 2007, one tax credit may be issued per year per residence based on the first-year energy yield of the AED in kWh multiplied by $2.00, not to exceed $6,000 and not to exceed 50 percent of the cost of the system. The maximum credit claimed per year will not exceed $1,500.

(3) For an energy-efficient appliance, the credit allowed under this section shall equal:

(a) 40 cents per kilowatt hour saved, or the equivalent for other fuel saved. The total for each appliance is not to exceed 25 percent of the cost of the appliance.

(b) $50 per 6,000 Btu/hr of nominal rated capacity, up to $400 or 25 percent of the cost, whichever is less, if the energy-efficient appliance is a very high efficiency air source ductless heat pump.

(4) For photovoltaic systems:

(a) Installed on or after November 4, 2005 and prior to January 1, 2011, the credit allowed under this section shall equal $3 per watt of the installed capacity measure in watts of direct current at industry standard test conditions.

(b) Installed on or after January 1, 2011 and before January 1, 2012, the credit allowed under this section shall equal $3 per watt of the installed output. This is equal to $2.10 per watt of the installed capacity measured in watts of direct current at industry standard test conditions.

(c) Installed on or after January 1, 2012, the credit allowed under this section shall equal $2.10 per watt of the installed capacity measured in watts of direct current at industry standard test conditions.

(d) A maximum of one credit valued at $6,000 shall be issued per residence per AED. The maximum amount of credit allowed per year, beginning in the year in which the AED was installed, is $1,500 per year over a four-year period. The total credit shall not exceed 50 percent of the cost of the system. All photovoltaic systems installed at a dwelling within a 5 year period shall be considered a single device.

(5) For premium efficiency biomass combustion devices, the credit allowed under this section shall be up to $300 or 25 percent of the cost of the device, whichever is less, based upon the efficiency and the first year energy yield of the AED in kilowatt hours multiplied by 40 cents as determined by the department.

(6) The amount of the tax credit must not exceed the net cost of the AED to the applicant. The sum of any rebates or cash payments, including public purpose organization or federal grants or credits and the residential energy tax credit may not exceed costs.

(7) For purposes of the tax credit, the cost of the AED must:

(a) Comply with OAR 330-070-0060 through 330-070-0097, as those rules apply;

(b) Be the net cost of acquiring the system.

(A) AEDs using an alternative energy source for only a part of their energy output or savings will have net cost prorated. Net cost must be based on that part of the AED’s energy output or savings that is due to the alternative source;

(B) The department may find an AED to be too large for a dwelling. In such case net cost must be prorated. Net cost must be based on the largest useful size of an AED for the dwelling. The department must determine largest useful size based on the energy needs of the building; and

(C) The amount of credit for the original system and an addition may not exceed $1,500 per year.

(8) For purposes of the tax credit, the net eligible cost of the AED is only those costs necessary for the system to yield energy savings and must not include:

(a) Unpaid labor including the applicant’s labor;

(b) Operating and maintenance costs;

(c) Land costs;

(d) Legal and court costs;

(e) Patent search fees;

(f) Fees for use permits or variances;

(g) Loan interest;

(h) Vendor rebates, discounts and refunds;

(i) Service contracts;

(j) Cost of moving a used AED from one site to another;

(k) Cost of repair or resale of a system;

(l) Any part of the purchase price which is optional, such as an extended warranty; and

(m) Delivery fees.

Stat. Auth.: ORS 469.086

Stats. Implemented: ORS 316.116

Hist.: DOE 1-1986, f. & ef. 2-7-86; DOE 4-1987, f. 12-18-87, ef. 1-1-88; DOE 2-1989, f. 12-28-89, cert. ef. 1-1-90; DOE 1-1996, f. & cert. ef. 4-1-96; DOE 1-1997, f. 12-15-97, cert. ef. 1-1-98; DOE 1-1999, f. 12-21-99, cert. ef. 1-1-00; DOE 2-2001, f. 10-5-01, cert. ef. 10-8-01; DOE 1-2004, f. & cert. ef. 1-21-04; DOE 2-2005, f. 12-30-05, cert. ef. 1-1-06; DOE 4-2007, f. 11-30-07, cert. ef. 12-1-07; DOE 7-2010(Temp), f. & cert. ef. 7-1-10 thru 12-28-10; DOE 16-2010, f. & cert. ef. 12-22-10; DOE 11-2011, f. 12-16-11, cert. ef. 1-1-12

330-070-0024

Year Credit Claimed

(1) The tax credit must be claimed pursuant to ORS 316.116.

(2) The tax credit may not exceed a person’s tax liability. Unused credit may be carried forward for a maximum of 5 years as allowed under ORS 316.116.

(3) Proof of purchase must be a contract or invoices dated in the year for which the applicant is claiming the credit.

Stat. Auth.: ORS 469

Stats. Implemented: ORS 469.160

Hist.: DOE 4-1987, f. 12-18-87, ef. 1-1-88; DOE 1-1989, f. & cert. ef. 6-15-89; DOE 2-1989, f. 12-28-89, cert. ef. 1-1-90; DOE 1-1999, f. 12-21-99, cert. ef. 1-1-00; DOE 2-2001, f. 10-5-01, cert. ef. 10-8-01; DOE 1-2004, f. & cert. ef. 1-21-04; DOE 16-2010, f. & cert. ef. 12-22-10; DOE 11-2011, f. 12-16-11, cert. ef. 1-1-12

330-070-0025

Application for System Certification

(1) Applicants for a tax credit must obtain a system certification from the department.

(2) Applications for a system certification must be made in a form developed by the department:

(a) All applications must provide all requested information and include a statement that the system and technician or owner-builder will meet all federal, state and local requirements;

(b) All applications must include the applicant’s social security number for use as an identification number in maintaining internal records. The applicant’s social security number may be shared with the Department of Revenue to establish the identity of an individual in order to administer state tax law.

(c) All applications must state:

(A) The net cost of the AED;

(B) The location of the AED;

(C) Estimated first-year energy yield of the AED provided by the technician or from the department’s energy yield chart, if any; and

(D) That the applicant has received an operating manual for the AED, except that no operating manual is required for sunspaces or direct gain space heating systems.

(d) All applications must state that the technician agrees to make any changes required by the department for the system to comply with ORS 469.160 through 469.180;

(e) All applications must be signed by the applicant and technician, if any, or, a form of electronic signature acceptable to the department shall be provided; and

(f) A technician or applicant must not give the department false or misleading information about an AED.

(g) Applications for third-party installations must include a valid reference number as issued to the third-party by the department under 330-070-0029.

(3) System certification applications for solar water heating AEDs must contain:

(a)     All the data required in section (2) and must also include:

(b) The number of collectors;

(c) The manufacturer and/or supplier;

(d) The collector dimensions and/or the net area of the collectors;

(e) The amount of heat storage;

(f) The system type;

(g) Declaration of SRCC certification status or equivalence as determined by the department;

(h) A description of the freeze protection for the system;

(i) A description of the over-heat protection for the system;

(j) The system model;

(k) Orientation and tilt of the collector;

(l) A sunchart for the collector location;

(m) A Consumer Disclosure signed by the applicant and technician or supplier, if any;

(n) A statement that the applicant has received a copy of consumer information supplied by the department; and

(o) Other data the department requires to determine eligibility.

(4) System certification applications for active solar space heating AEDs must contain:

(a) All the data required in sections (2) and (3) of this rule;

(b) A heat loss estimate for the home;

(c) The type and amount of thermal storage;

(d) A sunchart for the collector location; and

(e) Other data the department requires to determine eligibility.

(5) System certification applications for passive solar space heating AEDs must contain:

(a) All the data required in section (2) above and must also contain:

(a) A copy of the building permit plans;

(b) A copy of the window specifications used;

(c) The type and amount of thermal storage;

(d) A sunchart taken at the center of the solar glazing; and

(e) Other data the department requires to determine eligibility.

(6) System certification applications for photovoltaic AEDs must contain:

(a) The data required in section 2 and must also contain:

(b) The number of modules;

(c) The brand name of the module(s);

(d) The module(s) area;

(e) The rated DC output in watts of the module(s) under Standard Test Conditions (STC);

(f) A description of the storage provided if storage is a part of the system;

(g) Storage brand and model;

(h) Storage capacity in kWh;

(i) The brand name of the inverter if an inverter is part of the system;

(j) The capacity of the inverter;

(k) Orientation and tilt of the array;

(l) A sunchart of the array location;

(m) Other data the department requires to determine eligibility; and

(n) Must submit copy of final inspection after system has been permitted by applicant’s local jurisdiction.

(7) System certification applications for ground source heat pumps must contain:

(a)     All the data required in section (2) of this rule and must also contain:

(b) For all systems connected to a well, data on the well including:

(A) Depth;

(B) Diameter (cased);

(C) Temperature;

(D) Static water level below grade;

(E) A copy of the well driller’s log, if available; and

(F) Other data the department requires to determine eligibility.

(c) For systems connected to a heat pump:

(A) Brand name and model number of the heat pump;

(B) Rated output at the entering water temperature;

(C) Estimated system COP rated by ARI under Standard 325 -85 at an entering water temperature of 50 degrees Fahrenheit; and

(D) Any other data the department requires to determine eligibility.

(d) For ground loop heat pump systems:

(A) All the information in subsection (7)(b) of this rule; and

(B) Brand name, rated output, estimated COP;

(C) Length and depth of the loop;

(D) Materials and spacing used;

(E) Type of heat transfer fluid; and

(F) Other data the department requires to determine eligibility.

(8) System certification applications for energy-efficient appliances must contain:

(a) All the data required in section (2) of this rule and must also contain;

(b) The dealer’s business location;

(c) The brand name, make, model number, capacity and/or size of the appliance;

(d) A signed copy of the sales agreement, which will include all of the following:

(A) Verification of applicant’s name and address; and

(B) Verification of model of appliance; and

(C) Verification of actual price paid for appliance.

(e) Certification of new equipment warranty; and

(f) Other data the department requires to determine eligibility.

(9) System certification applications for alternative fuel devices must contain:

(a) Taxpayer’s name;

(b) Taxpayer i.d. or social security number;

(c) State of Oregon vehicle registration number if the device is a vehicle;

(d) Installation location by street address;

(e) The name of the licensed and bonded company employing the technician;

(f) The company’s business location;

(g) The brand name, make, model number, or component list of the AFD;

(h) A signed copy of the sales agreement, which will include all of the following:

(A) Verification of applicant’s name and address; and

(B) Verification of model of, or components used for AFD; and

(C) Verification of actual price paid for the AFD.

(i) Certification of new equipment warranty;

(j) An optional letter attached to the application declaring that the applicant designates an Investor Owned Utility (IOU) or other qualifying entity as the eligible recipient of the credit certificate on behalf of the project owner applicant that includes:

(A) Name, address, contact person, phone number, facsimile number of the IOU or designated qualifying party; and

(B) Signature, or form of electronic signature acceptable to the department, of an authorized representative of the IOU or other designated qualifying party stating willingness to accept the tax credit certificate; and

(k) Other data the department requires to determine eligibility.

(10) System certification applications for fuel cells must provide information regarding:

(a) The data required in section (2) and must also contain:

(b) The rated fuel cell stack peak capacity, in kW;

(c) The rated fuel cell system peak capacity, in kW (this rating includes peak capacity enhancing devices such as batteries and other storage devices or systems);

(d) Whether or not the system is grid connected;

(e) The fuel used by the system;

(f) The type of fuel stack (PEM, PAFC, SOFC, etc.);

(g) An estimate of the average load, in kW, expected to be placed on the system;

(h) The thermal energy production rate, in Btu/hour, at peak capacity and at the average load specified in (10)(f) above;

(i) Whether or not the system has provisions for thermal heat recovery, and if so, where the thermal energy is designed to be used (domestic hot water, space heating, etc.); and

(j) Other data the department requires to determine eligibility.

(11) System certification applications for premium efficiency biomass combustion devices must provide information regarding:

(a) The manufacturer, model, capacity, serial number; and

(b) The device characteristics defined as catalytic, non-catalytic, or pellet stove or boiler; and

(c) Vendor name and address; and

(d) Price paid for the device, any parts or installation; and

(e) A signed certification from the applicant verifying that any wood burning device which is being replaced has been rendered unusable and will be retired permanently from service; and

(f) The efficiency and grams of smoke per hour published in the List of EPA Certified Wood Stoves; or

(g) The efficiency and grams of smoke per hour published in a third-party list approved by the Director in the year in which the device was purchased; or

(h) A certificate of performance including the grams of smoke per hour and efficiency for the specific manufacturer and model of wood burning device from a currently US EPA certified woodstove testing laboratory.

(i) Other data the department required to determine eligibility.

(12) A system certification may be transferred by an applicant who does not qualify for tax relief to the first eligible buyer of the dwelling.

(13) For a third party financed system, the application must provide copies of an energy purchase or lease agreement and full service maintenance agreement.

Stat. Auth.: ORS 469.086

Stats. Implemented: ORS 316.116

Hist.: DOE 6-1979, f. & ef. 11-13-79; DOE 1-1982, f. 1-12-82, ef. 2-1-82; DOE 6-1983, f. 12-16-83, ef. 1-1-84; DOE 7-1984, f. & ef. 12-19-84; DOE 1-1986, f. & ef. 2-7-86; DOE 4-1987, f. 12-18-87, ef. 1-1-88; DOE 1-1988(Temp), f. & cert. ef. 1-13-88; DOE 1-1989, f. & cert. ef. 6-15-89; DOE 2-1989, f. 12-28-89, cert. ef. 1-1-90; DOE 1-1996, f. & cert. ef. 4-1-96; DOE 1-1997, f. 12-15-97, cert. ef. 1-1-98; DOE 1-1999, f. 12-21-99, cert. ef. 1-1-00; DOE 2-2001, f. 10-5-01, cert. ef. 10-8-01; DOE 1-2004, f. & cert. ef. 1-21-04; DOE 2-2005, f. 12-30-05, cert. ef. 1-1-06; DOE 4-2007, f. 11-30-07, cert. ef. 12-1-07; DOE 16-2010, f. & cert. ef. 12-22-10; DOE 11-2011, f. 12-16-11, cert. ef. 1-1-12

330-070-0026

Technician Tax Credit Certification

(1) Technicians may apply for the department’s tax-credit certification for a technology listed in subsection (2) of this section. Certification is intended to assist consumers with the state tax credit program, ensure that the systems are installed according to department rules, and verify system installation quality and performance. Technician certifications are valid for three years and must be renewed to remain in effect.

(2) A tax-credit certified technician applies only to the following products:

(a) Solar water heating systems;

(b) Ground source heat pumps (geothermal);

(c) Photovoltaic systems;

(d) Performance-tested ducts; and

(e) Air source heat pumps/air conditioning systems.

(3) The tax-credit certified technician’s qualification is based on the following:

(a) Knowledge and understanding of the tax credit program requirements and expectations;

(b) Ability to provide systems that are designed and installed consistent with the manufacturer’s warranty; and

(c) Employment by a company with a Construction Contractors Board (CCB) license.

(d) Those who do not maintain these competencies are subject to revocation of the certification.

(4) A Tax-credit certified technician qualification entitles a technician to:

(a) Inform the AED system owner that he or she has attended the department’s periodic training classes and is familiar with the rules and requirements of the Residential Energy Tax Credit Program.

(b) Verify that installation of tax-credit qualified equipment and systems meet department standards for performance and longevity.

(5) Tax-credit certified technician status requires that the technicians must follow department requirements including:

(a) Duct and air-source heat pump/air conditioning technicians must have a current or valid certification with Performance Tested Comfort System (PTCS) or Proctor Engineering CheckMe! Programs.

(b) Solar technicians must show a valid or current (North American Board of Certified Energy Practitioners-NABCEP certification or Limited Renewable Energy Technician (LRT) license for solar electric, Solar Thermal License (STL) for solar thermal, or pass the department’s competency testing with a score of 70 or above for the technology. On or after May 4, 2009, new applicants for tax credit certified solar technicians must show NABCEP photovoltaic (PV) certification or successfully passed the NABCEP PV Entry-Level Exam or Limited Renewable Energy Technician (LRT) license or Solar Thermal License (STL) or other certification approved by the Director to be a tax credit certified solar technician. On and after May 4, 2010 all tax credit certified solar technicians must show proof of appropriate NABCEP or LRT or STL certification or other certification approved by the Director to maintain their tax credit solar certification with the department.

(c) First-time geothermal technician applicants must show proof of successful completion of International Ground Source Heat Pump Association training (IGSHPA) or IGSHPA certified manufacturer’s installer training program or other training approved by the Director.

(d) Solar and geothermal tax credit certified technician applicants must participate in periodic department tax-credit training at least once every three years unless otherwise specified in department rule..

(e) Technicians must verify the AED owner has user manual for equipment/system.

(f) Technicians must provide the AED owner with a completed application and a copy of the final itemized dated invoice for the system that is marked “inspected and paid for.” Verify owner has a written full warranty for the system that lasts no less than 24 months after the system is installed.

(g) Technicians must maintain tax-credit certification status by completing the following technology-specific requirements during the previous three years:

(A) For solar technology:

(i) Submit and approve two (2) Residential or Business Energy Tax Credit applications for systems in technology in which technician is certified and complete four (4) hours of related technical continuing education; or

(ii) Submit and approve one (1) Residential or Business Energy tax Credit application for system in technology in which technician is certified and complete six (6) hours of related technical continuing education; or

(iii) Complete eight (8) hours of related technical education.

(B) For air source heat pumps/air conditioning: Must have a current or valid certification with PTCS or Proctor Engineering CheckMe! Programs.

(C) For performance tested duct systems: Must have a current or valid certification with PTCS.

(D) For ground-source heat pumps: Have submitted and approved a minimum of one (1) tax credit application or proof of having completed at least two hours of relevant installer training, community college HVAC course, or other training approved by the Director.

(6) Tax credits for installation of air source heat pumps/air conditioning systems, performance-tested ducts, geothermal systems, solar electric and solar thermal systems must be verified by a department tax-credit certified technician.

(7) A tax-credit certified technician must notify the department within 30 days if changes are made in any of the information in the certification application.

(8) The department will list companies employing duct and air-source heat pump/air conditioning technicians. A listed company must:

(a) Employ a tax credit certified technician who has a valid or current certification with PTCS or Proctor Engineering CheckMe! Programs.

(b) Apply in writing and renew their listing on an annual basis.

(c) Have a minimum of two key administrative staff participate in the department’s periodic update training.

(d) Tax credit certified technicians that do not meet the minimum requirements are suspended for one-year after which they may reapply.

Stat. Auth.: ORS 469.086

Stats. Implemented: ORS 316.116

Hist.: DOE 1-1982, f. 1-12-82, ef. 2-1-82; DOE 6-1983, f. 12-16-83, ef. 1-1-84; DOE 7-1984, f. & ef. 12-19-84; DOE 1-1986, f. & ef. 2-7-86; DOE 4-1987, f. 12-18-87, ef. 1-1-88; DOE 1-1989, f. & cert. ef. 6-15-89; DOE 2-1989, f. 12-28-89, cert. ef. 1-1-90; DOE 1-1995, f. & cert. ef. 1-17-95; DOE 1-1996, f. & cert. ef. 4-1-96; DOE 1-1997, f. 12-15-97, cert. ef. 1-1-98; DOE 1-1999, f. 12-21-99, cert. ef. 1-1-00; DOE 2-2001, f. 10-5-01, cert. ef. 10-8-01; DOE 1-2004, f. & cert. ef. 1-21-04; DOE 2-2005, f. 12-30-05, cert. ef. 1-1-06; DOE 4-2007, f. 11-30-07, cert. ef. 12-1-07; DOE 7-2008, f. 10-31-08, cert. ef. 11-1-08; DOE 16-2010, f. & cert. ef. 12-22-10; DOE 11-2011, f. 12-16-11, cert. ef. 1-1-12

330-070-0027

Application Review Process

(1) The department must review applications for AED tax credit approval. AEDs must comply with OAR 330-070-0010 through 330-070-0097. Specific rules for each type of AED are provided in OAR 330-070-0060 through 330-070-0097.

(2) The department will return applications that are not complete and will identify the additional information needed.

(3) The department may require more details to complete its review of an application.

(a) If the department requests additional data and does not receive it within 30 days the department may deny the application;

(b) During review, the department may ask for proof that the AED complies with OAR 330-070-0010 through 330-070-0097. The department may also ask for changes to allow the AED and application to comply with these rules.

(4) To obtain the information needed to evaluate an application or to verify eligibility and first year energy yield, the department may, with the owner’s consent, inspect an installed AED:

(a) The department may deny a system certification or request Department of Revenue (DOR) to initiate proceedings for the forfeiture of a tax credit if an owner refuses to allow the department to inspect the AED;

(b) The department may require corrections to make the AED or tax credit application comply with OAR 330-070-0010 through 330-070-0097 to be made within 30 days; and

(c) If such changes are not made within this time limit, the department may reject the application.

(d) The department may use the results of utility inspections in lieu of its own inspection.

(5) The department may reject any application if the AED does not comply with ORS 469.160 through 469.180 and OAR 330-070-0010 through 330-070-0097. The department will explain all rejected applications in writing. Approved requests for lesser cost than claimed by the applicant will also include a written explanation of the basis for the determination.

(6) If the department rejects an application for system certification or approves a certification for lesser cost than claimed by the applicant, an applicant may appeal the rejection. The appeal must be filed within 60 days of the mailing of the rejection notice by the department, in accordance with ORS 183.310 through 183.500.

(7) If the department receives an application(s) for a qualifying alternative fuel device accompanied by a letter from the applicant designating an IOU or other qualifying party as the recipient of the tax credit certificate, then the department may aggregate such applications and issue a single tax credit certificate to designated qualifying party quarterly for applications for projects to be completed in that calendar year.

Stat. Auth.: ORS 469

Stats. Implemented: ORS 469.160

Hist.: DOE 1-1982, f. 1-12-82, ef. 2-1-82; DOE 6-1983, f. 12-16-83, ef. 1-1-84; DOE 7-1984, f. & ef. 12-19-84; DOE 1-1986, f. & ef. 2-7-86; DOE 2-1987, f. & ef. 5-13-87; DOE 4-1987, f. 12-18-87, ef. 1-1-88; DOE 2-1989, f. 12-28-89, cert. ef. 1-1-90; DOE 1-1997, f. 12-15-97, cert. ef. 1-1-98; DOE 1-1999, f. 12-21-99, cert. ef. 1-1-00; DOE 2-2001, f. 10-5-01, cert. ef. 10-8-01; DOE 1-2004, f. & cert. ef. 1-21-04; DOE 16-2010, f. & cert. ef. 12-22-10; DOE 11-2011, f. 12-16-11, cert. ef. 1-1-12

330-070-0029

Third-Party Alternative Energy Device Installations

(1) A third-party who intends to complete a third-party alternative energy device installation must obtain a reservation before commencing installation.

(2) The third-party must apply to reserve potential tax credits by submitting a completed reservation request to the department. A reservation request may only be submitted after the owner of the residential property has entered into a contract for a third-party alternative energy device installation. The reservation request must contain the information required by the department on its form, but may be submitted in an alternative format.

(3) The department may require the third-party to provide a copy of the signed contract at any time after the submission of a reservation request. Failure to provide requested documents within 30 calendar days may result in the loss of reservations made by the third-party.

(4) A third-party may request the reservation of up to 25 potential tax credits in each reservation request, and may submit one request each week.

(5) The department will reserve the requested potential tax credits from the amount allowed by Oregon Laws 2011, chapter 730, section 75 and will provide the third-party with a reference number for each potential tax credit. The owner of the residential property at which the alternative energy device is installed must include the reference number on their tax credit application.

(6)    A third-party may release a reservation by submitting a written request, including the reference number, to the department. If reservations are released in the same tax year they are reserved the department will re-allocate the potential tax credits to new reservation requests in the order the requests are received. Reservations of potential tax credits may not be transferred.

(7) The department will continually monitor the rate of allocation of tax credits to ensure that the total amount of tax credits do not exceed the amounts specified in Oregon Laws 2011, chapter 730, section 75. The department will allocate potential tax credits according to these rules and in the order in which requests are received. The department will return any excess reservation requests. A third-party may not commence installation until a reservation is issued by the department.

(8) The department will issue tax credits based on the year the potential tax credit is reserved if the installation is completed, as verified by an approved final inspection issued by the local jurisdiction, before April 1 of the following tax year. Tax credits for installations completed after April 1 of the tax year following reservation will be issued for the tax year in which the installation is completed.

(9) Reservation of potential tax credits does not guarantee approval of tax credit applications.

Stat. Auth.: ORS 469

Stats. Implemented: ORS 469.160 - 469-180

Hist.: DOE 11-2011, f. 12-16-11, cert. ef. 1-1-12

330-070-0045

Enforcement

(1) Applicant’s actions that are cause for revocation of a residential alternate energy tax credit:

(a) A system certification may be revoked pursuant to ORS 469.180 if the Director finds that:

(A) The applicant obtained the system certification as a result of misrepresentation;

(B) The AED has not been installed or operated in substantial compliance with the plans, specifications or procedures specified in the application or certificate, such as:

(i) Failure to follow applicable standards;

(ii) Failure to comply with required codes or obtain required permits or inspections;

(iii) Return of the AED to the seller or installer for a refund;

(iv) Sale or removal of the device so that it no longer operates on the property of the applicant; or

(C) The applicant refuses to allow the department to inspect the AED after a reasonable written request by the department. A reasonable request must allow applicant to choose a day within three weeks of the request from the department.

(b) Following revocation, the applicant must forfeit the tax credit, and the department of Revenue must proceed to collect any taxes not paid by the taxpayer because of this credit.

(2) A technician’s tax credit certification may be revoked pursuant to ORS 469.180 if the Director finds that:

(a) The system or technician tax-credit certification was obtained by fraud or misrepresentation by the technician. The Director may find that fraud or misrepresentation occurred if false statements were made regarding the technician’s licenses held, products or warranties carried by the tax-credit certified technician’s employing company, the company’s range of product cost, personnel employed in the business, or any other item in the application for technician tax-credit certification as defined in OAR 330-070-0026.

(b) The technician’s performance regarding sales or installation of the alternative energy device for which the technician is issued a tax credit certificate under ORS 469.170 does not meet industry standards. The Director may find that the technician’s performance does not meet industry standards under the following conditions:

(A) The technician’s employing company is not registered with the Construction Contractors Board or does not carry the required level of insurance, licensure or bonding; or

(B) The technician and/or employing company fails to obtain the required state, federal or local permits required to install the AED as defined in OAR 330-070-0040; or

(C) The technician fails to install the AED system in compliance with standards adopted under OAR 330-070-0060 through 330-070-0097; or

(D) The technician fails to install the AED system to comply with manufacturers’ published specifications; or

(E) The technician and employing company fail to honor contract provisions when there is no legitimate excuse for nonperformance of the obligation; or

(F) The technician and employing company fail to honor a warranty which they are contractually obligated to perform; and

(G) The technician and/or employing company fail to make corrections to remedy failure to comply with paragraphs (A) through (G) of this subsection requested by the department within 30 days of written notification from the department of the problem, unless a time extension is granted by the department.

(H) A tax credit for an AED sold or installed under the technician tax-credit certification is ordered revoked under subsection (2)(a) of this rule; or

(I) New information indicates that the AEDs installed under the technician tax-credit certification and his or her employing company does not meet eligibility requirements.

(c) The technician or employing company has misrepresented to the customer either the tax credit program or the nature or quality of the alternative energy device. The Director may find that the technician or employing company has misrepresented the tax credit program or the AED under the following conditions:

(A) The technician or employing company has provided false or misleading information to the customer regarding the availability of the tax credit, amount and nature of the tax credit, procedures for tax credit application, eligibility standards for credit, or any other misleading information about the program implemented under ORS 469.160 through 469.180; or

(B) The technician or employing company has misrepresented the nature of the performance of the AED or claimed savings in excess of those on a yield chart without providing accurate calculations to the customer and to the department to substantiate the yield. For geothermal heat pumps, the technician or employing company has claimed savings higher than other units of similar efficiency; or

(C) The technician or employing company has misrepresented the cost of a system. For example, the technician or employing company omits costs in the contract for features necessary for basic installation and/or operation of the system and/or costs to comply with the AED eligibility under ORS 469.160 through 469.180; or

(D) The technician or employing company has misrepresented a competitor’s product or service; and

(E) The technician or employing company fails to make corrections requested in writing to the department to remedy violations of (A)-(D) of this subsection within 30 days, unless more time is allowed by the department; or

(F) The technician or employing company fails to remedy the construction and/or warranty claim as directed by order of the Construction Contractors Board.

Stat. Auth.: ORS 469

Stats. Implemented: ORS 469.180

Hist.: DOE 5-1978, f. & ef. 9-27-78; DOE 6-1979, f. & ef. 11-13-79; DOE 1-1982, f. 1-12-82, ef. 2-1-82; DOE 6-1983, f. 12-16-83, ef. 1-1-84; DOE 1-1986, f. & ef. 2-7-86; DOE 4-1987, f. 12-18-87, ef. 1-1-88; DOE 1-1989, f. & cert. ef. 6-15-89; DOE 2-1989, f. 12-28-89, cert. ef. 1-1-90; DOE 1-1995, f. & cert. ef. 1-17-95; DOE 1-1997, f. 12-15-97, cert. ef. 1-1-98; DOE 1-1999, f. 12-21-99, cert. ef. 1-1-00; DOE 2-2001, f. 10-5-01, cert. ef. 10-8-01; DOE 1-2004, f. & cert. ef. 1-21-04; DOE 2-2005, f. 12-30-05, cert. ef. 1-1-06; DOE 4-2006, f. 12-29-06, cert. ef. 1-1-07; DOE 16-2010, f. & cert. ef. 12-22-10; DOE 11-2011, f. 12-16-11, cert. ef. 1-1-12

330-070-0048

Administrative Process for Review and Revocation of Technician Tax Credit Certification

(1) If ODOE receives a complaint, the tax-credit certified technician and employing company must be notified and given an opportunity to respond.

(a) If the complaint relates to issues that the Construction Contractors Board (CCB) has authority to resolve, the complaint must be referred to the CCB for resolution. The CCB generally has authority to address construction, warranty claims or complaints involving dishonest or fraudulent conduct. Failure to comply with the order of the CCB must be grounds for revocation of technician tax-credit certification or civil penalty.

(b) In all other cases, ODOE must evaluate the technician’s or employing company’s response and determine whether a violation occurred. ODOE must notify the technician and employing company of its determination and, if appropriate, the necessary remedy. ODOE must give the technician and employing company 30 days to remedy a violation. ODOE may grant the technician and employing company additional time where appropriate.

(2) If the technician and employing company do not take appropriate action within the time specified, ODOE must begin enforcement proceedings. An enforcement proceeding may be brought to revoke the technician tax-credit certification, remove company name from ODOE listing, and/or to impose a civil penalty.

(3) ODOE must commence an enforcement proceeding by sending the technician and employing company a notice of violation. The notice must describe the violation(s) and notify the technician and employing company of the proposed penalty (revocation and/or civil penalty).

(4) Civil Penalties: The technician and employing company may be subject to a civil penalty if a system certification or technician tax-credit certification is revoked by the Director. The amount of the penalty must be the total amount of tax relief estimated to have been provided to purchasers of the system for which a system or technician tax-credit certification is revoked under this rule.

(5) Before the Director imposes a penalty, the technician and/or employing company must be given 21 days in which to request a hearing pursuant to ORS 183.310-183.550 and the Attorney General’s Uniform and Model Rules of Procedure, January 1, 2006 edition. The hearing will be to contest the revocation of a system or technician tax-credit certification based on actions listed under OAR 330-070-0045.

(6) Re-application: To reapply after the revocation of a technician tax-credit certification, the technician and employing company must prove to the satisfaction of the department that the problem causing revocation has been corrected. Revocation must be in effect for at least one year before that technician or employing company or any other firm with any of the same shareholders may reapply for certification.

Stat. Auth.: ORS 469

Stats. Implemented: ORS 469.180

Hist.: DOE 1-1995, f. & cert. ef. 1-17-95; DOE 1-1997, f. 12-15-97, cert. ef. 1-1-98; DOE 1-1999, f. 12-21-99, cert. ef. 1-1-00; DOE 2-2000, f. 12-29-00, cert. ef. 1-1-01; DOE 2-2001, f. 10-5-01, cert. ef. 10-8-01; DOE 1-2004, f. & cert. ef. 1-21-04; DOE 2-2005, f. 12-30-05, cert. ef. 1-1-06; DOE 4-2007, f. 11-30-07, cert. ef. 12-1-07; DOE 11-2011, f. 12-16-11, cert. ef. 1-1-12

330-070-0060

Solar Domestic Water Heating AEDs

(1) Installations must be of professional quality, comply with all applicable state, county, or local codes and regulations and be verified by a tax-credit certified solar technician.

(2) Consumers who purchase a solar water heating system must receive written operating and maintenance instructions. These instructions must be plainly mounted/displayed on or near the solar storage or backup water-heating tank. These instructions must at a minimum include:

(a) Clear instructions on how to determine if the system is functioning properly;

(b) Description and recommended frequency of homeowner maintenance;

(c) Diagram of the system noting location of valves and monitoring devices;

(d) What to do and who to call in an emergency and when the system needs professional maintenance and repairs; and

(e) How to protect the system from overheating due to stagnation during periods when the system is not in use during the summer months.

(3) System designs and installations must comply with the following additional requirements:

(a) Collectors and piping must be securely mounted to withstand local wind loads;

(b) Piping and pump sizing must consider collector area, total flow rates, pressure drop across collectors, length of run from collectors to pump, and maximum allowable pressure drop for the system;

(c) Pipe insulation must be installed on all solar pipe runs and protected against damage from exposure in outdoor conditions and be rated for design condition temperatures;

(d) Any building insulation disturbed due to the system installation must be restored to previous condition;

(e) For systems using pressurized anti-freeze fluids, a pressure gauge must be installed to indicate pressure in the system; and

(f) Piping containing pressurized water in attics 24 hours a day must be of the appropriate material allowed by applicable Oregon plumbing codes. A minimum number of fittings must be used in the attic, and the fittings shall be copper or brass.

(g) Pipe materials (e.g. copper, PEX, polybutylene) must be capable of handling the temperature ranges that they will be exposed to (e.g. freezing or collector stagnation).

(4) Freeze protection must be provided for systems where the heat transfer fluid may freeze. The freeze protection method must follow these rules:

(a) The method must be clearly stated in the owner’s manual.

(b) The method must work in the absence of utility electric power.

(c) Systems using tanks, piping, pumps and other components containing water in unheated spaces must be adequately protected from freezing.

(d) Recirculation is not an acceptable freeze protection measure, unless the collector used is a heat pipe type.

(e) Drain-down or manual drain systems are not acceptable freeze protection methods for solar domestic water heating systems.

 (f) Thermosyphon systems may not connect power to the electric element in roof-mounted tanks as a freeze protection or backup measure.

(5) The annual energy requirement for domestic water heating must be reduced by setting the water heater thermostat to 120 degrees F.

(6) A method to show that the system is operating correctly must be provided.

(a) For passive systems this must be a thermometer in line between solar storage and backup tank.

(b) For an active system this must be a flow meter in the supply line to the collectors and a thermometer on the outlet port of the solar storage tank.

(c) Equipment meeting this requirement must:

(A) Be a permanent part of the system;

(B) Not require any special tools or equipment to monitor; and

(C) Be in an accessible location.

(7) The costs listed in subsection (8)(a) through (j) of this rule do not include all eligible costs. Other costs will qualify if justified to the department’s satisfaction as part of a solar water heating AED. Only total systems will qualify for the tax credit.

(8) Eligible costs include:

(a) The cost of solar collectors;

(b) The cost of thermal storage devices;

(c) The cost of ductwork, piping, fans, pumps and controls that move heat from solar collectors to storage and to heat buildings;

(d) The cost of monitors, meters and controls;

(e) The cost of photovoltaic devices used to supply electricity to parts of the system;

(f) Installation charges;

(g) Fees paid for design or building;

(h) The cost of swimming pool blankets, if they are installed with a solar pool heating system;

(i) The cost of hot water conservation measures installed with a water heating AED; and

(j) Up to $200 of the cost of solar access easements. A certified copy of the recorded easement and proof of the cost must be submitted with an application.

(9) Annual energy savings will be based on the annual performance simulations provided by the Solar Rating and Certification Corporation (SRCC) modified for conditions required under state law.

(a) OG-300 systems that meet the department’s approval do not have to be on the yield chart if there has been no request by a tax-credit certified technician that they appear on the yield chart.

(b) For the purposes of determining the tax credit, the annual energy savings will be reduced by:

(A) 25 percent if the total solar resource fraction for the site is less than 75 percent, and by 100 percent if the total solar resource fraction for the site is less than 50 percent for systems completed prior to January 1, 2011.

(B) 100 percent if the total resource fraction is less than 75 percent for systems completed on or after January 1, 2011.

(10) All systems must meet the standards established by the SRCC OG-300 system certification in effect at the time the rules are adopted, or equivalent requirements as determined by the Director.

(a) Prior to January 1, 2011, temporary authorization will be granted to non-OG-300 systems under a special “Research & Development” status. The department will extend this temporary authorization for up to 12 systems of a specific design. The solar technician will need to submit a complete copy of the system design and operation documents provided to the consumer to the department for approval. The department shall determine that such system will perform well under the conditions it is designed for and will likely last in excess of 15 years without replacement of major components. Tax credit amounts under this status will be determined by the department based on 90 percent of the estimated annual energy output. On or after January 1, 2011, the temporary authorization provided in this section expires.

(b) Prior to January 1, 2011, temporary authorization may be extended to non-OG-300 systems under an “OG-300 Applicant” status providing the system manufacturer is currently applying for OG-300 certification from SRCC. The department will extend an unlimited quantity of systems to be installed in a 12-month period, providing the department has reviewed a copy of the SRCC application and determined it to be reasonably likely to achieve OG-300 certification within the 12-month period.

(c) On or after January 1, 2011, temporary authorization may be extended to non-OG-300 systems under an “OG-300 Applicant” status the system must comply with all local codes and the manufacturer must have submitted an application to the SRCC for OG-300 certification. The department must review and approve a copy of the SRCC application including the operations manual prior to the installation of the system.

(11) All technician tax-credit certified-installed systems must:

(a) Include an O&M manual which specifies installation instructions, operation instructions, maintenance plan, fluid quality, service and replacement parts, hazards, and warranty coverage;

(b) Provide clear labeling of on/off/bypass controls and safety issues;

(c) Have a means of indicating proper operation of the solar water heating system (flow indicators/meter or thermometers);

(d) Be installed to meet local building codes; and

(e) Have a tempering valve to prevent greater than 120 degree F. water downstream of the valve.

(12) Systems shall be installed with the OG-300 certification sticker located on the manual cover. The manual and any supporting documentation shall be placed in a waterproof, clear plastic bag located on or near the solar or domestic hot water heater.

(13) Owner-built and site-built domestic water heating systems must meet testing requirements. The department may evaluate the system design and assign it a yield based on 50 percent of its estimated annual energy performance. Owner-built and site-built domestic water heating systems must be tested by a TCCT or a verifier approved by the department.

[Publications: Publications referenced are available from the agency.]

Stat. Auth.: ORS 469.086

Stats. Implemented: ORS 316.116

Hist.: DOE 12(Temp), f. & ef. 10-14-77; DOE 3-1978, f. & ef. 3-7-78; DOE 5-1978, f. & ef. 9-27-78; DOE 6-1979, f. & ef. 11-13-79; DOE 1-1982, f. 1-12-82, ef. 2-1-82; DOE 6-1983, f. 12-16-83, ef. 1-1-84; DOE 7-1984, f. & ef. 12-19-84; DOE 1-1986, f. & ef. 2-7-86; DOE 4-1987, f. 12-18-87, ef. 1-1-88; DOE 1-1989, f. & cert. ef. 6-15-89; DOE 2-1989, f. 12-28-89, cert. ef. 1-1-90; DOE 1-1995, f. & cert. ef. 1-17-95; DOE 1-1996, f. & cert. ef. 4-1-96; DOE 1-1997, f. 12-15-97, cert. ef. 1-1-98; DOE 1-1999, f. 12-21-99, cert. ef. 1-1-00; DOE 2-2000, f. 12-29-00, cert. ef. 1-1-01; DOE 2-2001, f. 10-5-01, cert. ef. 10-8-01; DOE 1-2004, f. & cert. ef. 1-21-04; DOE 2-2005, f. 12-30-05, cert. ef. 1-1-06; DOE 4-2006, f. 12-29-06, cert. ef. 1-1-07; DOE 4-2007, f. 11-30-07, cert. ef. 12-1-07; DOE 16-2010, f. & cert. ef. 12-22-10; DOE 11-2011, f. 12-16-11, cert. ef. 1-1-12

330-070-0064

Photovolatic AEDs

(1) Installations must be professional quality, comply with all applicable Oregon codes and be verified by a tax-credit certified solar technician.

(2) System size shall be determined by the sum of all the photovoltaic module DC wattage ratings under standard test conditions (STC).

(3) The minimum system size must be 200 Watts DC output under STC.

(4) Photovoltaic AED costs eligible for the tax credit include the cost of:

(a) Photovoltaic modules;

(b) Inverters;

(c) Storage systems and regulators;

(d) Monitors, meters, and controls;

(e) Wiring and framing materials;

(f) Trackers;

(g) Installation charges; and

(h) Permits and fees, including up to $200 of the cost of solar access easements. A certified copy of the recorded easement and proof of the cost must be submitted with an application.

(5) For the purposes of determining the tax credit, the annual energy savings will be reduced by:

(a) 25 percent if the total solar resource fraction for the site is less than 75 percent and by 100 percent if the total solar resource fraction for the site is less than 50 percent for projects completed prior to January 1, 2011.

(b) 100 percent if the total solar resource fraction for the site is less than 75 percent for projects completed on or after January 1, 2011.

[Publications: Publications referenced are available from the agency.]

Stat. Auth.: ORS 469.086

Stats. Implemented: ORS 316.116

Hist.: DOE 1-2004, f. & cert. ef. 1-21-04; DOE 2-2005, f. 12-30-05, cert. ef. 1-1-06; DOE 4-2006, f. 12-29-06, cert. ef. 1-1-07; DOE 4-2007, f. 11-30-07, cert. ef. 12-1-07; DOE 16-2010, f. & cert. ef. 12-22-10; DOE 11-2011, f. 12-16-11, cert. ef. 1-1-12

330-070-0070

Ground-Source Heat Pump

(1) Only total systems will qualify for a tax credit. All systems must comply with OAR 330-070-0025 and 330-070-0040 and be of closed loop design and operation. See also OAR 330-070-0027.

(2) Systems must limit waste of the resource.

(3) Systems must not have adverse effects on:

(a) Other systems; and

(b) Water quality applying the standards of the Department of Environmental Quality.

(4) Systems must not create hazards such as:

(a) Steam or water vapor;

(b) Vapors or odors;

(c) Noise; and

(d) Hazardous wellhead design.

(5) System parts must have adequate:

(a) Structural strength;

(b) Resistance to weather and fire;

(c) Ease of upkeep; and

(d) Durability.

(6) No system will cause harmful physical effects on people or unwanted tastes or odors.

(7) Some heat transfer fluids need special handling. These include toxic, corrosive, and explosive fluids. Such fluids shall only be used when the system is designed to safely handle them.

(8) Under normal operation, any part of a system that may be touched by people must be cooler than 141 degrees F. If this cannot be done, any part that reaches more than 140 degrees F. must have warning labels. Each system must include a device to limit water for domestic use to 140 degrees F.

(9) Each system and nearby structures must be protected against pressures, vacuums and temperatures.

(10) Systems must fully protect drinking water as specified in the Oregon Plumbing Specialty Code.

(11) Systems must use storage tanks built by accepted methods. Each tank must be tested for leaks.

(12) Expansion and contraction due to changing heat levels must not cause undue strain or distortion.

(13) Systems that use heat transfer fluids that may freeze must have freeze protection.

(14) Systems must use accepted methods to guard against the known corrosion/scaling level of the water.

(15) Systems must also be designed for the least effect on groundwater.

(16) Ground loop systems must cover enough ground to meet total annual heating requirements, as required by manufacturers’ recommended design standards. Ground loops used for cooling must restore soil moisture.

(17) Downhole heat exchangers (direct use geothermal systems) must include a summary report from Oregon Institute of Technology or other source approved by the Director which describes the system and indicates that it will deliver sufficient heat and the design meets current good practice guidelines. They will be reviewed on a case-by-case basis.

(18) The system COP must be at least 3.3 for closed loop systems and 3.5 for direct expansion (DX) systems, including energy used by pumps. COP shall be determined by the following methods:

(a) For water source heat pumps, the COP must be determined in accordance with ARI Standard 325-85, at an entering water temperature of 50 degrees F.

(b) For water source or ground loop heat pumps using ambient surface water as an energy source and for solar assisted heat pumps, the COP must be the measured ratio of the heating season energy output divided by the heating season energy input. Both energy values must be expressed in the same units.

(19) All other types of ground source heat pumps must be reviewed on their COP.

(20) Bermed or earth covered buildings will not qualify for the geothermal tax credit.

(21) All ground source heat pumps must include setting the water heater thermostat to 120 degrees F as a hot water conservation measure.

(22) A ground source heat pump system may receive a supplemental tax credit amount, determined by the department, based on additional energy savings, if the duct system to which it is attached is tested and certified in accordance with the PTCS Duct Sealing Certification Program. This amount is in addition to the tax credit amount for the ground source heat pump system itself, and in addition to the tax credit amount provided for the duct testing and certification itself. In order to earn the supplemental tax credit amount, the ground source system must be installed, the duct system must be tested and certified, and the applications for all tax credit amounts associated with the system must be received, as a single package, by the department by April 1st of the tax year following the tax year for which the credits are being claimed.

Stat. Auth.: ORS 469.086

Stats. Implemented: ORS 316.116

Hist.: DOE 12(Temp), f. & ef. 10-14-77; DOE 3-1978, f. & ef. 3-7-78; DOE 5-1978, f. & ef. 9-27-78; DOE 6-1979, f. & ef. 11-13-79; DOE 1-1982, f. 1-12-82, ef. 2-1-82; DOE 6-1983, f. 12-16-83, ef. 1-1-84; DOE 1-1986, f. & ef. 2-7-86; DOE 4-1987, f. 12-18-87, ef. 1-1-88; DOE 1-1989, f. & cert. ef. 6-15-89; DOE 2-1989, f. 12-28-89, cert. ef. 1-1-90; DOE 1-1996, f. & cert. ef. 4-1-96; DOE 1-1997, f. 12-15-97, cert. ef. 1-1-98; DOE 1-1999, f. 12-21-99, cert. ef. 1-1-00; DOE 2-2001, f. 10-5-01, cert. ef. 10-8-01; DOE 1-2004, f. & cert. ef. 1-21-04; DOE 4-2006, f. 12-29-06, cert. ef. 1-1-07; DOE 7-2008, f. 10-31-08, cert. ef. 11-1-08; DOE 16-2010, f. & cert. ef. 12-22-10; DOE 11-2011, f. 12-16-11, cert. ef. 1-1-12

330-070-0073

Energy-Efficient Appliances and Alternative Fuel Devices

(1) Energy-efficient appliances must meet or exceed the following energy efficiency ratings, as measured in accordance with current United States Department of Energy (USDOE) test procedures where applicable, and be currently listed with the department as qualifying premium efficiency appliances. In the event that the same model number has more than one energy efficiency rating, one of which is non-qualifying, all units with that model number will be declared ineligible and removed from the department’s qualifying list of premium efficiency appliances. Models declared ineligible due to multiple energy efficiency ratings may be reinstated upon demonstration by the manufacturer that the problem has been remedied, but not earlier than 12 months from the time of removal from the list.

(2) Where USDOE test procedures do not exist, the department will designate a nationally recognized test procedure that will apply instead.

(3) Clothes washers.

(a) For the purpose of this program, clothes washer efficiency performance is determined using the USDOE Appendix J1 test procedure for residential clothes washers in effect at the time the rules are adopted.

(b) Clothes washers purchased on or after:

(A) April 1, 2007 and prior to January 1, 2011 must have a minimum Modified Energy Factor (MEF) of 2.0 ft3/kWh/cycle and a maximum Water Factor (WF) of 6.4 gal/ ft3/cycle.

(B) January 1, 2011 must have a minimum Modified Energy Factor (MEF) of 2.2 ft3/kWh/cycle and a maximum Water Factor (WF) of 4.5 gal/ ft3/cycle.

(C) January 1, 2012 are not eligible.

(c) Equipment efficiency requirements are based on ENERGY STAR® listing or other third-party certified list approved by the department.

(4) Refrigerator-Freezers.

(a) Refrigerator-Freezers purchased:

(A) prior to January 1, 2011 must have at least 20 percent lower energy consumption than that allowed by the July 1, 2001 USDOE standard for refrigerator/freezers.

(B) on or after January 1, 2011 must have at least 30 percent lower energy consumption than that allowed by the July 1, 2001 USDOE standard for refrigerator/freezers.

(C) on or after January 1, 2012 are not eligible.

(b) Must have a total net volume (sum of the fresh food compartment and freezer compartment volumes) of at least 12 cubic feet, but less than 31 cubic feet; and

(c) Must have a fully automatic defrost cycle.

(d) Equipment efficiency requirements are based on listing by ENERGY STAR® or other third-party certified list approved by the Director.

(5) Dishwashers.

(a) Dishwashers purchased on or after:

(A) January 1, 2008 and prior to January 1, 2011 must have an Energy Factor of 0.70 cycles/kWh or higher.

(B) January 1, 2011, standard dishwashers as defined by ENERGY STAR®, must have an Energy Factor of at least 0.75 cycles/kWh or higher; and compact dishwashers, as defined by ENERGY STAR®, must have an Energy Factor of at least 1.00 cycles/kWh or greater.

(C) January 1, 2012 are not eligible.

(b) Dishwashers must have tax credit eligibility based on an Energy Factor derived from the DOE Dishwasher Test Procedure effective September 28, 2003.

(c) Equipment efficiency requirements are based on by ENERGY STAR® listings or other third-party certified list approved by the Director.

(6) Water Heating Appliances.

(a) Water heater efficiency requirements:

(A) Equipment efficiency requirements for units of nominal 1-ton or less capacity are based on listing by ENERGY STAR® or California Energy Commission or on the USDOE Energy Factor, as derived from the USDOE Appendix E test procedure for residential water heating equipment in effect at the time the rules are adopted. Efficiency requirements for units larger than 1-ton in capacity and smaller than 6-tons in capacity, are based on the system COP at 47 degrees F outdoor air temperature or other rating point appropriate for the system deemed equivalent by the department.

(B) High-efficiency heat pump water heaters for domestic hot water must meet the Northern Tier Specifications established by the Northwest Energy Efficiency Alliance (NEEA) for electricity; split systems with a capacity greater than 1-ton and less than 6-tons shall have a COP rating of not less than 2.5.

(C) Natural gas, propane, or oil-fired residential storage type water heaters, as defined by Title 10, Code of Federal Regulations, Chapter 11, Part 430, Subpart B, Appendix E, must have an Energy Factor of 0.80 or greater as tested with natural gas fuel.

(D) Whole-home gas fired instantaneous water heaters, as defined by Title 10, Code of Federal Regulations, Chapter 11, Part 430, Subpart B, Appendix E, must have:

(i) an Energy Factor of at least 0.80, a maximum firing rate of at least 140,000 Btu/hour and a minimum firing rate no higher than 24,000 Btu/hour if installed prior to January 1, 2011;

(ii) an Energy Factor of at least 0.82 or greater if installed on or after January 1, 2011.

(E) Equipment efficiency requirements are based on either the listing by ENERGY STAR®, the directory of the Air-Conditioning, Heating, and Refrigeration Institute (AHRI), or other third-party certified list approved by the Director.

(b) Combined space/water-heating system efficiency must be based on the water heating Energy Factor for Combined Systems (CEF) as derived from the American National Standards Institute/American Society of Heating, Refrigerating, and Air Conditioning Engineers (ANSI/ASHRAE) 124-1991 test method. Water heaters that are part of a combined space and water heating system may not receive a tax credit for space heating efficiency as a boiler in addition to the tax credit as a water heating appliance.

(7) For Wastewater Heat Recovery Systems, field performance data submitted to and approved by the department must be the basis for tax credit qualification. The following rules also apply:

(a) The systems must meet all plumbing code requirements for vented double-wall heat exchangers;

(b) The system must not interfere with the proper operation of the dwelling’s wastewater system; and

(c) Energy recovered must be re-introduced into the dwelling’s hot water supply system.

(8) Performance Checked Space Conditioning Duct Systems must meet the following requirements:

(a) All work must be done in accordance with Performance Tested Comfort Systems (PTCS) specifications, a regionally developed set of protocols with provisions for testing and sealing duct work that is maintained by the Regional Technical Forum (RTF), as adopted by the RTF and in effect at the time the work is performed.

(b) If the home serviced by the performance checked duct system is new, or the building envelope is being altered, the house must meet residential energy conservation requirements of the Oregon Structural Specialty Code or of the Oregon One and Two Family Dwelling Code in effect at the time the home is constructed or structurally altered.

(c) Duct leakage must be tested in accordance with Performance Tested Comfort Systems (PTCS) approved testing protocols.

(d) Testing to verify that these standards have been achieved must be conducted by technicians approved by the department.

(e) Measures eligible for the purpose of calculating a performance checked duct system tax credit include:

(A) New construction.

(i) Duct sealing labor and materials;

(ii) Heating and cooling load calculations;

(iii) Duct system sizing and design calculations;

(iv) Labor and materials for installing multiple returns;

(v) Labor and materials for installing passive pressure relief grilles;

(vi) Duct testing; and

(vii) Labor and materials for bringing duct systems inside heated space.

(B) New ducts in existing homes.

(i) Duct sealing labor and materials;

(ii) Heating and cooling load calculations;

(iii) Duct system sizing and design calculations;

(iv) Labor and materials for installing multiple returns;

(v) Labor and materials for installing passive pressure relief grilles; and

(vi) Duct testing.

(C) Duct repair and sealing/existing ducts in existing homes.

(i) Duct sealing labor and materials;

(ii) Labor and materials for installing multiple returns;

(iii) Labor and materials for installing passive pressure relief grilles; and

(iv) Duct testing.

(f) To apply for a performance checked duct tax credit, the following information must be submitted in a form approved by the department:

(A) Application form;

(B) Test results worksheet for “new construction,” “new duct systems in existing homes,” or “duct repair and sealing”/existing ducts in existing homes, as applicable; or inclusion of the PTCS identification number associated with the measure being submitted for tax credit on the application form.

(C) Copies of heating and cooling load calculations and/or duct sizing calculations, as applicable, shall be made available to the department upon request; and

(D) Itemized invoice identifying measures detailed in (e).

(g) The amount of the tax credit for performance checked duct systems must be 25 percent of the eligible costs detailed in (e), up to $250.

(9) Performance Checked Heat Pumps and Central Air Conditioners must meet the following standards:

(a) Systems must be tested and serviced as needed to confirm correct refrigerant charge and air flow by technicians certified by the department and by an approved Performance Tested Comfort System (PTCS) provider.

(b) Testing shall be in accordance with PTCS specifications, a regionally developed set of protocols with provisions for testing the operation of air-source heat pumps and air conditioners that are maintained by the Regional Technical Forum (RTF), as adopted by the RTF and in effect at the time the work is performed.

(c) Eligible measures must be confirmed by the system diagnostic tests using PTCS protocols in use at the time of measure installation. Duplicate tax credits may not be claimed.

(d) Measures eligible for the purpose of calculating a performance checked heat pump/air conditioner tax credit include:

(A) System diagnostic tests;

(B) Adding or removing refrigerant when initial diagnostic tests indicate need for refrigerant adjustment and post repair tests indicate correct charge has been installed;

(C) Altering the duct system to improve air flow when initial diagnostic tests show low air flow and post repair tests show an air flow improvement of 10 percent or more;

(D) Cleaning the inside coil when initial diagnostic tests indicate low air flow and post repair tests show an air flow improvement of 10 percent or more;

(E) Replacing an existing inside fan motor with an electronically commutated permanent magnet motor (ECPM DC) when initial diagnostic tests show low air flow and tests after ECPM DC installation show an air flow improvement of 10 percent or more; and

(F) Control modifications necessary for the system to pass the diagnostic test.

(e) To apply for a performance checked heat pump/air conditioner tax credit, the following information must be submitted in a form approved by the department:

(A) Application form;

(B) Performance checked heat pump/AC diagnostics data entry form;

(C) Pre and post repair system air flow measurements using approved methods listed in (b), if applicable;

(D) Itemized labor and materials cost information for applicable measures, testing, and repairs.

(f) The amount of the performance checked heat pump/AC tax credit must be 25 percent of the cost of testing and modifications to existing equipment, up to $250.

(10) Alternative Fuel Vehicles must have equipment installed to make the vehicle capable of storing and utilizing an alternative fuel for vehicle propulsion.

(a) Equipment may consist of:

(A)   Original equipment manufacturer components;

(B)    Components for natural gas powered vehicles that meet EPA1-A requirements current at the time these rules are adopted;

(C)    Components for hybrid vehicles must provide the hybrid vehicle with a combination of power between propulsion energy systems such that the peak power ratio of the vehicle is 0.10 or greater; or

(D)   Other components as recognized by the department as necessary for alternative fuel use.

(b) Those applying for alternative fuel vehicle tax credits must acknowledge that they do not intend to transfer ownership of the vehicle to a non-Oregon resident for a period of one year.

(c) Vehicles must be purchased before January 1, 2012.

(11) Alternative Fuel Fueling Systems must be installed to meet all state and local fire and life safety codes and be capable of re-fueling /recharging an alternative fuel vehicle within 14 hours. The following rules also apply:

(a) On-board charging systems that feed into the rechargeable energy storage system in a hybrid vehicle must be high-voltage systems of 100 Volts or higher that have an active regenerative braking system integrated into the recharging system of the hybrid vehicle; and

(b) The use of an on-board charging system on a hybrid vehicle must result in significant energy savings as determined by the Director.

(12) Energy Recovery Ventilators (ERVs) must:

(a) Be tested, rated and certified through the Home Ventilating Institute (HVI) Division of the Air Movement and Control Association (AMCA) International, Inc., and listed in the HVI directory;

(b) Be capable of at least 30 percent Latent Recovery/Moisture Transfer (LRMT) at 32°F when operating on the lowest fan speed;

(c) Have a maximum EUI(HERV) of 1.5 watts/cfm at the lowest fan speed for which performance data is published in the HVI directory; and

(d) Have a minimum Sensible Recovery Efficiency (SRE) of:

(A) 65 percent at 32°F/0°C when operating at the lowest fan speed;

(B) 60 percent at 32°F/0°C when operating at the highest fan speed; and

(C) 60 percent at -13°F/-25°C when operating at the lowest fan speed, if rated at this condition.

(13) Heat Recovery Ventilators must:

(a) Be tested, rated and certified through the Home Ventilating Institute (HVI) Division of the Air Movement and Control Association (AMCA) International, Inc., and listed in the HVI directory;

(b) Have a maximum EUI of 1.5 watts/cfm at the lowest fan speed for which performance data is published in the HVI directory; and

(c) Have a minimum Sensible Recovery Efficiency (SRE) of:

(A) 65 percent at 32°F/0°C when operating at the lowest fan speed;

(B) 60 percent at 32°F/0°C when operating at the highest fan speed; and

(C) 60 percent at -13°F/-25°C when operating at the lowest fan speed, if rated at this condition.

(14) Very High Efficiency Air Conditioning Systems must:

(a) Be a central, split-system designed and installed to operate in conjunction with the air handling unit or furnace of a home’s heating system;

(b) Be tested and rated in accordance with the DOE test procedure for residential air-conditioning systems in effect at the time these rules are adopted, and certified by, and listed in the directory of the Air Conditioning Heating and Refrigeration Institute (AHRI) in effect at the time these rules are adopted;

(c) Consist of a matched outdoor unit and indoor unit (air handler and coil or furnace and coil), as tested, rated and listed in the directory of the Air-Conditioning, Heating, and Refrigeration Institute (AHRI);

(d) Have a minimum EER rating at DOE standard test condition “A” conditions of 13.0;

(e) Be installed in accordance with the protocols specified in section 330-070-0073(9)(a) through 330-070-0073(9)(g) of these rules; and

(f) Be purchased before January 1, 2012.

(15) Very High Efficiency Air Source Heat Pump Systems must:

(a) Be tested and rated in accordance with the USDOE Appendix M test procedure for residential air-conditioning systems in effect at the time these rules are adopted, and be certified by, and be listed in the directory of the Air-Conditioning, Heating, and Refrigeration Institute (AHRI) that is in effect at the time these rules are adopted;

(b) Consist of a matched outdoor unit and indoor unit (air handler and coil or furnace and coil), as tested, rated and listed in the directory of the Air-Conditioning, Heating, and Refrigeration Institute (AHRI);

(c) Have a minimum DOE Region IV HSPF rating of 9.0 or greater;

(d) Have a minimum EER rating at DOE’s standard test condition “A” of at least 12.0; and

(e) Be installed in accordance with the protocols specified in section 330-070-0073(9)(a) through 330-070-0073(9)(g) of these rules.

(16) Very High Efficiency Warm Air Furnace Systems must:

(a) Be tested and rated in accordance with the USDOE Appendix N test procedure for furnaces in effect at the time these rules are adopted, and be certified by and listed in the directory of the Air-Conditioning, Heating, and Refrigeration Institute (AHRI) in effect at the time these rules are adopted;

(b) Have a minimum AFUE rating:

(A) of 0.90 (90 percent) for installations completed prior to January 1, 2009;

(B) of 0.92 (92 percent) for installations completed on or after January 1, 2009 and prior to January 1, 2011;

(C) of 0.94 (94 percent) for installations completed on or after January 1, 2011 and prior to January 1, 2012; and

(D) of 0.95 (95 percent) for installations completed on or after January 1, 2012.

(c) Use ducted outdoor air for combustion; and

(d) Must be listed in the Air-Conditioning, Heating, and Refrigeration Institute (AHRI) directory of Certified Energy Rating in effect at the time these rules are adopted as an “e” “electrically efficient” furnace. The “e” electrically efficient designation applies to furnaces whose electricity consumption is 2 percent or less of the furnaces total energy use, according to the department’s official test procedure, and is determined according to the following formula: (3413 x EAE) / [(3413 x EAE) + (1,000,000 x EF)] ≤ 2.0 percent. EAE is the average annual auxiliary electrical energy consumption for a gas furnace in kilowatt-hours per year (kWh/yr). It is a measure of the total electrical energy supplied to a furnace during a one-year period. EF is the average annual fuel energy consumption for a gas furnace in millions of Btu’s per year (MMBtu/yr).

(17) Very High Efficiency Air Handlers must:

(a) Be installed as part of a hydronic space heating system; and

(b) Be equipped with an electronically commutated, permanent magnet variable speed DC (ECPM) motor.

(18) Very High Efficiency Hot Water Boiler Systems must:

(a) Be tested and rated in accordance with the USDOE Appendix N test procedure for furnaces in effect at the time these rules are adopted, and be certified by and listed in the directory of the Air-Conditioning, Heating, and Refrigeration Institute (AHRI) in effect at the time these rules are adopted.

(b) Have a minimum AFUE rating:

(A) Of 0.88 (88 percent) for installations completed prior to January 1, 2009.

(B) Of 0.92 (92 percent) and must include an outdoor temperature reset control for installations completed on or after January 1, 2009.

(c) Be purchased before January 1, 2012.

(19) Very High Efficiency Air Source Heat Pump or Furnace Systems may receive a supplemental tax credit amount, determined by the department, based on additional energy savings if the duct system to which it is attached is tested and certified in accordance with the PTCS Duct Sealing Certification Program. This amount is in addition to the tax credit amount for the Very High Efficiency Air Source Heat Pump or Furnace system itself, and in addition to the tax credit amount provided for the duct testing and certification itself. In order to earn the supplemental tax credit amount, the heating system must be installed, the duct system must be tested and certified, and the applications for all tax credit amounts associated with the system must be received, as a single package, by the department by April 1st of the tax year following the tax year for which the credits are being claimed.

(20) Very High Efficiency Ductless Air Source Heat Pump Systems must:

(a) Include an inverter-driven variable speed compressor;

(b) Be listed in the Air Conditioning, Heating and Refrigeration Institute (AHRI) Directory of Certified Products.

(c) Deliver at least 50 percent of its AHRI-certified rated heating capacity at 17°F outside temperature;

(d) Include no integrated electric resistance backup heat;

(e) Be sized and installed per manufacturer specifications; and

(f) Be installed by a technician trained by the equipment manufacturer within the last five years.

(21) Very Efficient Biomass Combustion Devices must be:

(a) Less than one quarter of a million British thermal units (Btu) per hour heat output, and

(b) Installed in an Oregon residential dwelling; and

(c) Installed with a dedicated outside combustion air intake; and

(d) Listed in the United States Department Environmental Protection Agency List of EPA Certified Wood Stoves or other third-party certified list approved by the Director with emissions of 4.5 grams of smoke per hour or less if it is designated in that list as a non-catalytic wood stove; or

(e) Listed in the List of EPA Certified Wood Stoves or other third-party certified list approved by the Director with emissions of 2.5 grams of smoke per hour or less if it is designated in that list as a catalytic wood or pellet stove; or

(f) Have a certificate of performance for the specific manufacturer and model of wood burning device from a currently US EPA certified woodstove testing laboratory. The certificate must show emissions of 4.5 grams of smoke per hour or less if it is designated as a non-catalytic wood stove or emissions of 2.5 grams of smoke per hour or less if it is designated as a catalytic wood or pellet stove.

(22) Any other standards adopted by the department for energy-efficient appliances and alternative fuel devices, their components, and/or systems as determined by the Director.

[ED. NOTE: Appendices referenced are available from the agency.]

Stat. Auth.: ORS 469.086

Stats. Implemented: ORS 316.116

Hist.: DOE 1-1982, f. 1-12-82, ef. 2-1-82; DOE 1-1986, f. & ef. 2-7-86; DOE 4-1987, f. 12-18-87, ef. 1-1-88; DOE 1-1996, f. & cert. ef. 4-1-96; DOE 1-1997, f. 12-15-97, cert. ef. 1-1-98; DOE 1-1999, f. 12-21-99, cert. ef. 1-1-00; DOE 2-2000, f. 12-29-00, cert. ef. 1-1-01; DOE 2-2001, f. 10-5-01, cert. ef. 10-8-01; DOE 1-2004, f. & cert. ef. 1-21-04; DOE 4-2004, f. & cert. ef. 8-2-04; DOE 2-2005, f. 12-30-05, cert. ef. 1-1-06; DOE 4-2006, f. 12-29-06, cert. ef. 1-1-07; DOE 4-2007, f. 11-30-07, cert. ef. 12-1-07; DOE 7-2008, f. 10-31-08, cert. ef. 11-1-08; DOE 16-2010, f. & cert. ef. 12-22-10; DOE 11-2011, f. 12-16-11, cert. ef. 1-1-12

330-070-0089

Wind AEDs

(1) To qualify for a tax credit:

(a) A minimum wind speed of 10 miles per hour at hub height or lower must be demonstrated at the wind AED site.

(b) A wind AED system manufacturer must make available estimated monthly or annual energy production data (kWh) at various annual average wind speeds for each model or system they produce.

(c)The wind AED system model must meet industry standards as approved by the department.

(d) A wind AED system application must include the nominal rated electric capacity, the power curve and energy production data as a function of the average annual wind speed.

(e) A wind system must have a minimum five-year manufacturer’s warranty.

(2) The department reserves the right to deny eligibility for any wind AED for any reason including, but not limited to poor generator performance, concerns about wind generation system design, the quality of data presented, lack of manufacturing support for maintenance or warranties.

(3) Systems must be designed and located to reduce the potential for hazards and unpleasant living conditions. Systems must be designed and located taking into account:

(a) The proximity of the system to buildings, power lines, antennae or other similar hazards;

(b) The effect of high winds on the system and on any building connected to the system by guy wires;

(c) Whether the system blocks fire lanes, obstructs dwelling access, or otherwise increases fire danger;

(d) Whether the operation of the system significantly increases background noise; and

(e) Whether connecting the system to other buildings by guy wires creates vibration and tension in other buildings.

(4) Materials used will assure that the wind AED has adequate:

(a) Strength;

(b) Resistance to ice, moisture, corrosion and fire;

(c) Durability; and

(d) Low maintenance cost.

(5) No part of a wind AED project must put toxic substances into the environment in amounts that will cause disease or harmful physical effects to humans, animals or plants.

(6) Wind AED parts must be serviceable without the need to trespass.

(7) Maximum Design Wind Speed: All parts of a Wind AED project must withstand the highest wind speed expected at its location. All parts must withstand this wind without damage. To meet this requirement, wind AEDs may be shut down during highest expected winds.

(8) Shutdown: All wind AEDs must have a way to stop the rotor from turning. This method must work safely during high winds and routine
service.

(9) Overspeed Control: Rotor overspeeds shall be prevented by the wind AED’s design.

(10) Tower Safety: All parts of a wind AED project shall meet accepted engineering standards. Tower design must include consideration of:

(a) Gravity load; and

(b) Peak thrust on the rotor, nacelle, tail and tower over the full wind speed operating range.

(11) Tower Height: A minimum tower height of 70 feet is required. All portions of the rotor disc of the wind AED must be at least 30 feet above any object within a 400 foot radius of the wind AED’s base.

(12) Electric: All wind AED electrical parts must adhere to all standards and codes in force at the time they are installed.

(13) The Director may waive part or all of section (1) of this rule if production of the wind AED model stopped prior to 1990, or it is an owner-built system or a mechanical wind AED.

(14) The first-year energy yield of wind AEDs must average at least 100 kWh per month based on the actual installation site of the wind AED.

(a) The first-year energy yield must be determined using the measured or estimated wind resource data and the wind AED’s power curve or actual energy production data measured in kWh per month.

(A) The provided wind data from the wind AED site must cover a one-year period of 12 consecutive months.

(B) In the event of less than one year’s measurements at the wind AED site, the application must include:

(i) A minimum of six consecutive months of on-site production data of the wind AED;

(ii) One year’s worth of concurrent data from the two nearest wind monitoring stations at 35 feet or less; and

(iii) One year’s worth of concurrent data for the wind AED site from a nationally recognized firm that provides estimated wind resource data based on advanced national wind mapping technology. These data can be obtained from a company that meets industry standards as approved by the department.

(b) The department will verify data supplied by the applicant and validate the first-year energy yield.

(c) Production data must be provided in the form of kWh produced monthly with the application for a tax credit.

Stat. Auth.: ORS 469.160 - 469.180

Stats. Implemented:

Hist.: DOE 1-1999, f. 12-21-99, cert. ef. 1-1-00; DOE 2-2001, f. 10-5-01, cert. ef. 10-8-01; DOE 1-2004, f. & cert. ef. 1-21-04; DOE 2-2005, f. 12-30-05, cert. ef. 1-1-06; DOE 4-2007, f. 11-30-07, cert. ef. 12-1-07; DOE 7-2008, f. 10-31-08, cert. ef. 11-1-08; DOE 16-2010, f. & cert. ef. 12-22-10; DOE 11-2011, f. 12-16-11, cert. ef. 1-1-12

330-070-0091

Eligible Costs for a Wind AED

(1) The costs listed in subsections (2)(a) through (m) of this rule do not include all eligible costs. Other costs will qualify if directly associated with the acquisition and installation of the AED. Only systems that are fully functional and producing electricity will qualify for a tax credit. All systems must comply with OAR 330-70-0021 and 330-070-0040.

(2) Eligible costs include:

(a) The cost of wind turbine generators;

(b) The cost of DC/AC converters, inverters and synchronous inverters;

(c) The cost of wind and system instruments and controls when part of a total wind AED;

(d) The cost of energy storage (batteries or other methods);

(e) The cost of tower, foundation and guys;

(f) Fees paid for design and building;

(g) Fee to install;

(h) The cost of electric meters, switches and electrical safety equipment;

(i) The cost of electric transformers and lines and supports;

(j) The cost of safety equipment;

(k) Up to $500 of wind permitting cost;

(l) The cost of windmills;

(m) The cost of pumps, linkage, pump heads, and vacuum chambers; and

(n) The cost of obtaining wind data assessments from a nationally recognized service as approved by the department, not to exceed $50.00.

Stat. Auth.: ORS 469.160 - 469.180

Stats. Implemented:

Hist.: DOE 1-1999, f. 12-21-99, cert. ef. 1-1-00; DOE 1-2004, f. & cert. ef. 1-21-04; DOE 4-2007, f. 11-30-07, cert. ef. 12-1-07; DOE 16-2010, f. & cert. ef. 12-22-10; DOE 11-2011, f. 12-16-11, cert. ef. 1-1-12

330-070-0097

Electricity Producing AEDs

Generating AEDs linked with an electric utility must be installed in accordance with local utility interconnect guidelines and be installed per the state electrical code.

Stat. Auth.: ORS 469

Stats. Implemented: ORS 469.170

Hist.: DOE 1-1982, f. 1-12-82, ef. 2-1-82; DOE 1-1986, f. & ef. 2-7-86; DOE 4-1987, f. 12-18-87, ef. 1-1-88; DOE 1-1997, f. 12-15-97, cert. ef. 1-1-98; DOE 1-1999, f. 12-21-99, cert. ef. 1-1-00; DOE 1-2004, f. & cert. ef. 1-21-04; DOE 2-2005, f. 12-30-05, cert. ef. 1-1-06; DOE 4-2007, f. 11-30-07, cert. ef. 12-1-07; DOE 16-2010, f. & cert. ef. 12-22-10; DOE 11-2011, f. 12-16-11, cert. ef. 1-1-12

 

Rule Caption: Implements new incentive program created by HB 3672 for energy conservation projects.

Adm. Order No.: DOE 12-2011(Temp)

Filed with Sec. of State: 12-23-2011

Certified to be Effective: 12-23-11 thru 6-19-12

Notice Publication Date:

Rules Adopted: 330-210-0000, 330-210-0010, 330-210-0020, 330-210-0030, 330-210-0040, 330-210-0045, 330-210-0050, 330-210-0060, 330-210-0070, 330-210-0080, 330-210-0090, 330-210-0100, 330-210-0150, 330-230-0000, 330-230-0010, 330-230-0020, 330-230-0030, 330-230-0040, 330-230-0050, 330-230-0060, 330-230-0110, 330-230-0120, 330-230-0130, 330-230-0140

Subject: House Bill 3672 (2011) created a new energy conservation incentive program within the Department of Energy. These rules provide the operating framework for the program, including application process, prioritization of applications within funding limits, issuance of tax credits, pass-through and compliance activities.

Rules Coordinator: Kathy Stuttaford—(503) 373-2127

330-210-0000

Applicability of Rules in OAR 330, Division 210

These rules implement the incentive program for energy conservation projects established by House Bill 3672 (2011). The rules also provide procedures for submission, agency review and selection of energy conservation projects for preliminary and final certification of tax credits. These rules apply to all applications for tax credits for energy conservation projects, as governed by Oregon Laws 2011, chapter 730, sections 34 through 51.

Stat. Auth.: OL 2011, Ch. 730, Sec. 34 - 51

Stats. Implemented: OL 2011, Ch. 730, Sec. 34 - 51

Hist.: DOE 12-2011(Temp), f. & cert. ef. 12-23-11 thru 6-19-12

330-210-0010

Definitions

For the purposes of this division, the following definitions apply:

(1) “Applicant” means a person who has applied for or who has received a preliminary certificate for a conservation energy incentive program tax credit or who has submitted an informational filing for a small premium project.

(2) “Certified cost” means the cost certified in the final certification.

(3) “Cost” has the meaning given in Oregon Laws 2011, chapter 730, section 38, the capital costs and expenses necessarily incurred in the acquisition, erection, construction and installation of an energy conservation project.

(4) “Department” means the Oregon Department of Energy.

(5) “Director” means the director of the department.

(6) “Energy conservation project” has the meaning given in Oregon Laws 2011, chapter 730, section 38, any capital investment for which the first year energy savings yields a simple payback period of greater than three years. “Energy conservation project” does not include:

(a) Recycling equipment, products and projects;

(b) Transportation projects;

(c) Energy recovery as that term is defined in ORS 459.005; or

(d) Alternative fuel vehicles.

(7) “Incremental cost” means the cost above a reasonable minimum expected to construct a similar project without energy efficiency features.

(8) “Installation or construction” means the process of physical assembly of an energy conservation project or supporting infrastructure at its operating location.

(9) “New construction” means a building project that is newly constructed.

(10) “Opportunity period” means the timeframe specified in an Opportunity Announcement for the department to accept applications for energy conservation projects.

(11) “Qualified third party” means a third party, selected by the director, that provides recommendations to the director regarding a research and development energy conservation project.

(12) “Qualifying project cost” means the amount of the energy conservation project’s cost that may be eligible for tax credits.

(13) “Research and development project” means an energy conservation project that a qualified third party recommends to the department as one that demonstrates innovation.

(14) “Service life” means equipment service life as established in the most recent edition of the American Society of Heating, Refrigeration and Air Conditioning Engineers’ (ASHRAE) Heating, Ventilating and Air Conditioning (HVAC) Applications Handbook as of the date the department receives a complete preliminary application or, for equipment not rated by ASHRAE, as determined by the department.

(15) “Small premium project” means an energy conservation project with qualifying project costs of less than $20,000 for which the department has identified prequalified measures.

(16) “Total building retrofit” means a comprehensive building retrofit that includes energy efficiency projects for each energy-using system including the building envelope. A building retrofit that does not include each energy-using system may apply as a total building retrofit; if the project meets the eligibility standards described in these rules.

(17) “Total project cost” means all costs directly associated with an energy conservation project, including ineligible costs.

Stat. Auth.: OL 2011, Ch. 730, Sec. 34 - 51

Stats. Implemented: OL 2011, Ch. 730, Sec. 34 - 51

Hist.: DOE 12-2011(Temp), f. & cert. ef. 12-23-11 thru 6-19-12

330-210-0020

Opportunity Announcement

(1) The department will announce the availability of tax credits for energy conservation projects by issuing an Opportunity Announcement.

(2) The department will continually monitor the allocation of tax credits to ensure that the total amount of potential tax credits does not exceed the tax credit caps specified in Oregon Laws 2011, chapter 730, section 49.

(3) If the cumulative total of all tax credits awarded under the Opportunity Announcement is less than the total amount of tax credits available, the department may reallocate the balance to a future Opportunity Announcement.

(4) The Opportunity Announcement will include the following information:

(a) Objectives for the opportunity period;

(b) The amount of tax credits available;

(c) Application requirements;

(d) Dates of the application opportunity period;

(e) Instructions and directions to the required application forms and materials;

(f) Minimum technical standards;

(g) The criteria to be applied in prioritizing applications for tax credits, as described in OAR 330-210-0060; and

(h) Other information the department considers necessary.

Stat. Auth.: OL 2011, Ch. 730, Sec. 34 - 51

Stats. Implemented: OL 2011, Ch. 730, Sec. 34 - 51

Hist.: DOE 12-2011(Temp), f. & cert. ef. 12-23-11 thru 6-19-12

330-210-0030

Preliminary Certification Application

(1) Any person may apply for preliminary certification by submitting a complete preliminary certification application. The application must meet requirements provided by applicable statutes, these rules and the current Opportunity Announcement. A preliminary certification application is not required for applicants submitting an informational filing under the small premium project process.

(a) The application must be in the form specified in the Opportunity Announcement and these rules.

(b) An applicant must submit a complete application during the opportunity period. For the purposes of this rule, the department considers an application “submitted” when the department receives the application. The department will not process applications received outside of an opportunity period.

(2) The application must be accompanied by the application fee specified in these rules. The department will not process applications received without fee payment.

(3) The department will not accept amendments to applications during the opportunity period. An applicant may withdraw an application and submit a replacement application during the opportunity period. The department will not process fees for applications withdrawn before the end of the opportunity period.

(4) The application must include the following information, unless the department specifies otherwise in the Opportunity Announcement.

(a) The name of the applicant:

(A) If the applicant is a partnership, joint venture or association, the application must include the names of each person participating in the partnership, joint venture or association.

(B) If the applicant is a corporation or limited liability company, the application must include the name of the corporation, or LLC and its parent corporations, members, and any close affiliates or subsidiaries.

(C) If the applicant is a public or government entity, the application must include written authorization from the entity’s governing body allowing submission of the application.

(b) The name, address, email address and telephone number of the responsible party for the applicant.

(c) The applicant’s federal tax identification number or social security number, which may be shared with the Department of Revenue to facilitate the administration of state tax law.

(d) A statement verifying that the applicant will be the owner, contract purchaser or lessee of the energy conservation project at the time of installation or construction of the project.

(e) A description of personnel and teams working on the energy conservation project’s development, implementation and operation.

(f) If the applicant has previously received tax credits or grants issued by the department, the application must contain a statement about the operational status of the projects awarded such grants or tax credits.

(g) The location of the energy conservation project.

(h) A statement explaining the amount by which the energy conservation project will reduce the consumption of purchased energy or use energy more efficiently. If applicable, provide information about the expected level of sustainable building practices project performance.

(i) A detailed description of the energy conservation project, information that demonstrates how the project will be technically feasible and how the project will operate for at least five years as represented in the application. This may require documentation in addition to the application form.

(j) The expected operational life of the energy conservation project.

(k) A statement of compliance with applicable state and local regulations and that the applicant will obtain required licenses and permits.

(l) The number and type of jobs that will be created by the energy conservation project and the number of jobs sustained throughout the construction, installation and operation of the project. Job estimates should be submitted in hours. These hours must directly relate to the energy conservation project.

(m) The anticipated total project cost, including the energy conservation project’s incremental cost, if applicable.

(n) The amount of anticipated or received incentives directly related to the energy conservation project.

(o) A project schedule.

(p) All research and development projects must include a recommendation from a qualified third party that the project demonstrates innovation.

(q) A description of the applicant’s installation or construction financing plan.

(r) The dollar amount of tax credit requested by the applicant.

(s) If the applicant has already started installation or construction of the energy conservation project, a written description of the special circumstances that rendered the filing of an application prior to the start of construction or installation unreasonable.

(t) Other information the department considers necessary.

Stat. Auth.: OL 2011, Ch. 730, Sec. 34 - 51

Stats. Implemented: OL 2011, Ch. 730, Sec. 34 - 51

Hist.: DOE 12-2011(Temp), f. & cert. ef. 12-23-11 thru 6-19-12

330-210-0040

Fees

The department adopts the following schedule of fees as provided by Oregon Laws 2011, chapter 730, section 46 for applicants. All fee payments are non-refundable, despite the results of the department’s review.

(1) Applicants, except those applying through the small premium project process, must submit a fee of $200 with their preliminary certification application.

(2) Applicants applying through the small premium project process must submit a fee of $60 with their informational filing.

(3) Applicants selected for technical review will be required to pay an additional technical review fee prior to that review. The fee amount is equal to the qualifying project cost multiplied by 0.55 percent. Small premium projects are not subject to the technical review fee.

(4) Applicants requesting amendments to preliminary certifications must submit a fee of $300 with their amendment request.

(5) Applicants for final certification must submit with their application a final review fee. This fee amount is equal to the qualifying project cost multiplied by 0.5 percent. All applicants seeking final certification for a project, including small premium projects, are required to apply for final review and pay the final review fee.

(6) If the department is unable to complete a scheduled inspection due to actions by the applicant, the department will require the applicant to pay a re-inspection fee of $400 before rescheduling the inspection.

(7) Applicants that choose to transfer their tax credit to a pass-through partner must pay a pass-through fee. The fee is due after a pass-through partner has been identified and before the department can issue a tax credit.

(a) If the department assists the applicant in obtaining a pass-through partner or partners, the fee for that assistance is 1 percent of the tax credit amount, up to $25,000.

(b) If the department does not assist the applicant in obtaining a pass-through partner, the fee is $100 per tax certificate issued.

(8) If an applicant fails to pay timely fees as required by this rule, the department may reject the pending application and discontinue the review.

Stat. Auth.: OL 2011, Ch. 730, Sec. 34 - 51

Stats. Implemented: OL 2011, Ch. 730, Sec. 34 - 51

Hist.: DOE 12-2011(Temp), f. & cert. ef. 12-23-11 thru 6-19-12

330-210-0045

Small Premium Project Review Process

(1) Projects with qualifying project costs of less than $20,000 may utilize the small premium project informational filing process, instead of the preliminary certification and competitive review process, if the project complies with the minimum department-established standards. Energy conservation projects with qualifying project costs of less than $20,000 may participate in the preliminary certification and competitive review process.

(2) The department will issue an Opportunity Announcement for small premium projects annually. The opportunity period will remain open for one year from the date the department issues the Opportunity Announcement, which could end sooner if funds are exhausted. The Opportunity Announcement will list the types of technologies with the minimum standards as defined by the department.

(3) Applicants must submit a complete informational filing prior to the project’s installation or construction on the form specified in the Opportunity Announcement and include:

(a) The required filing fee;

(b) Information that the project meets the definition of an energy conservation project and is located in Oregon; and

(c) Other requirements described in the Opportunity Announcement.

(4) Small premium projects are eligible for predetermined tax credits based on savings and cost; but the tax credits cannot exceed 35 percent of certified costs. The department will post the predetermined tax credit amounts in the Opportunity Announcement.

(5) If the tax credits available for small premium projects have been fully allocated before the department receives a complete informational filing, applicants will not be eligible for any tax credits for the project under the small premium review process but may participate in the preliminary certification competitive review process.

(6) If the department finds that the filing is complete, the department will confirm in writing the receipt of an informational filing. The department will not process incomplete filings, and will provide written notification.

(7) Receipt of an informational filing does not guarantee eligibility and issuance of a final certification for the tax credit. Applicants must also comply with all applicable statutory requirements and requirements listed these rules in order to receive tax credits. The department will determine the eligibility of the small premium project prior to issuing a final certificate.

(8) Small premium project informational filings will expire 12 months after the date the department receives the informational filing, unless the department receives a complete final certification application before the end of the 12 month period.

Stat. Auth.: OL 2011, Ch. 730, Sec. 34 - 51

Stats. Implemented: OL 2011, Ch. 730, Sec. 34 - 51

Hist.: DOE 12-2011(Temp), f. & cert. ef. 12-23-11 thru 6-19-12

330-210-0050

Completeness Review

(1) Following the opportunity period, the department will review all preliminary certification applications, other than those participating in the small premium project process, to determine whether:

(a) All sections of the application are complete.

(b) The applicant has submitted the required fee.

(c) The project meets the definition of an energy conservation project.

(d) The applicant intends to begin construction within 12 months of award.

(e) The applicant is applying prior to the installation or construction of the project.

(A) If the applicant applies after installation or construction of the project has started, the department will deny the application unless a written explanation of the special circumstances is received and approved by the director.

(B) Failing to submit a timely application or not being selected for a grant or tax credit under this or prior department programs does not constitute special circumstances.

(f) The energy conservation project is located in Oregon.

(g) Other requirements described in the Opportunity Announcement have been met.

(2) If the department finds that the application is complete, the application will move into the competitive review process and the department will notify the applicant, in writing.

(3) The department will deny all incomplete applications and notify applicants in writing of the reason for denial of the application.

(4) The department considers the completeness review a test; the decision to deny an incomplete application is not subject to a contested case hearing under ORS 183.

Stat. Auth.: OL 2011, Ch. 730, Sec. 34 - 51

Stats. Implemented: OL 2011, Ch. 730, Sec. 34 - 51

Hist.: DOE 12-2011(Temp), f. & cert. ef. 12-23-11 thru 6-19-12

330-210-0060

Competitive Review

(1) The department will conduct a competitive review of all applications that pass the completeness review, other than those participating in the small premium project process.

(2) Through competitive review, the department’s internal review team will prioritize applications for preliminary certification according to the criteria described in the rules and detailed in the Opportunity Announcement. Depending on the Opportunity Announcement objectives, the department may give greater or lesser weight to each of the criteria listed in rules.

(3) For the purposes of the competitive review, the department will compare projects of similar technology types against each other. The technological sector categories for energy conservation projects are:

(a) Building envelopes, weatherization.

(b) Renewably sourced thermal energy projects that use a renewable energy source, such as solar, biomass or geothermal, directly without converting it to electricity. Within this category, energy savings will be determined through energy displacement.

(c) Building energy systems.

(d) Sustainable buildings such as new construction and total building retrofit.

(e) Commercial, agricultural and industrial processes.

(4) Within the technological sector categories, the department may divide the applications into tiers based on project size. The Opportunity Announcement will have details about any tiers prior to implementation.

(5) In the Opportunity Announcement, the department will list the evaluation criteria for the competitive review. The competitive review will give preference to projects that have the highest energy savings over the five-year tax credit period per tax credit dollar requested. Additional criteria the department may consider include:

(a) The amount of energy saved over the equipment’s lifetime;

(b) The project’s expected lifespan compared to the simple payback period;

(c) The incentive structure and whether the energy savings benefit a party other than the owner;

(d) Lifetime energy savings compared to lifetime cost (benefit-to-cost ratio);

(e) The project implementation plan;

(f) The project financial plan;

(g) Information on job creation;

(h) The geographical area and local economic conditions of the site location;

(i) Agreement to a voluntary reduction of requested tax incentive; and

(j) Agreement to a voluntary measurement and verification plan, which includes an agreement to share the results with the department.

(6) The department’s internal review team will recommend to the director which projects to advance to technical review based on the competitive review results. The director will review and then amend or approve the recommendations.

(7) The department will notify applicants of the competitive review’s outcome. The department may place projects not advanced to the technical review phase on a supplemental list, pending the technical reviews of selected projects. The department will retain the supplemental list until the technical review for selected energy conservation projects is complete.

(8) If an applicant has not started installation or construction of the energy conservation project, an applicant may apply again for the same project in a future opportunity period by submitting a new application and fee. The department will not apply fees or applications submitted in response to a previous Opportunity Announcement to future Opportunity Announcements.

Stat. Auth.: OL 2011, Ch. 730, Sec. 34 - 51

Stats. Implemented: OL 2011, Ch. 730, Sec. 34 - 51

Hist.: DOE 12-2011(Temp), f. & cert. ef. 12-23-11 thru 6-19-12

330-210-0070

Technical Review

(1) Once the applicant has paid the technical review fee, the department will conduct a technical review of projects advanced from the competitive review process. If the applicant does not submit the required payment to the department within 14 calendar days of notification for technical review, the department may deny the application.

(2) The department will review the information provided in the application against industry standards to determine whether the project is technically feasible and should operate in accordance with the representations made by the applicant.

(3) To be eligible the energy conservation project must meet the following requirements:

(a) The project must meet the requirements of the statutes, these rules and the Opportunity Announcement.

(b) The applicant must be owner, contract purchaser or project lessee at time of the project’s installation or construction.

(c) The applicant must be a trade, business or rental property owner with a business site in Oregon or be an Oregon non-profit organization, tribe or public entity that partners with an Oregon business or resident. The applicant may not restrict membership, sales or service on the basis of race, color, creed, religion, national origin, sexual preference or gender.

(d) A project located at a residential property must be rental property. A rental property must meet the requirements of the state building codes and contain a dwelling unit or rooming unit with permanent living facilities. Living facilities include facilities for sleeping, eating, cooking and sanitation, for one or more persons, other than the property owner, which is subject to a rental agreement that provides for meaningful compensation to the owner and which compensation is subject to Oregon income or excise tax.

(e) The applicant must demonstrate the ability to begin construction within 12 months from the date the department issues the project’s preliminary certification.

(f) The energy conservation project must meet the simple payback requirements. The department bases simple payback on total project cost divided by the qualified annual energy savings. Total project cost is calculated for this purpose before any tax credits or grants are applied.

(g) An applicant for a new construction or total building retrofit project must demonstrate that the project meets the current standard, at the time of application submission, for one of the following:

(A) Leadership in Energy and Environmental Design (LEED);

(i) The project must be seeking LEED platinum certification with a minimum of eight Energy and Atmosphere points; or

(ii) Using the appropriate peer reviewed energy modeling program, the project must show a minimum 26 percent improvement over ASHRAE 90.1-2007, without addenda.

(B) Green Globes

(i) The project must be seeking Green Globes, Four Globes certification; or

(ii) Using the appropriate peer reviewed energy modeling, the project must be a building falling within the 95th percentile, or better, of the equivalent building stock listed in the Commercial Buildings Energy Consumption Survey (CBECS). Where an equivalent building type is not listed, the modeling must be equivalent to a minimum 26 percent improvement over ASHRAE 90.1-2007, without addenda.

(C) Reach Code

(i) Project plans must be submitted to a local building department and approved for building under the Oregon Reach Code.

(ii) For proposed buildings either required to model or opting for the modeling path, the energy model must show at least an 18 percent improvement over the Oregon Energy Efficiency Specialty Code.

(D) Earth Advantage

(i) The project must be seeking Earth Advantage Gold Certification; or

(ii) Using the appropriate peer reviewed energy modeling program, the project must show a minimum 18 percent improvement over the Oregon Energy Efficiency Specialty Code.

(h) An application for replacing inefficient or obsolete equipment must demonstrate that the equipment is beyond its maximum service life, as determined by the department.

(i) A qualified third party must evaluate and recommend research and development projects.

(4) The department will review energy conservation project cost for eligibility to determine qualifying project costs. Cost may include the capital costs and expenses necessarily incurred in the acquisition, erection, construction and installation of an energy conservation project. The application must document total project cost by providing a line item break out.

(a) Qualifying project costs include:

(A) The cost of components of the proposed energy conservation project;

(B) Fees to design or engineer the energy conservation project;

(C) The cost of title searches, escrow fees, permit and license fees, excluding fees required by this rule, and shipping;

(D) Costs for all materials and supplies needed for the erection, construction, installation or acquisition of the proposed energy conservation project;

(E) Cost of work performed by employees or independent contractors of the applicant based on the following conditions:

(i) Employees or contractors must be certified, accredited, licensed or otherwise qualified to do the work;

(ii) The work must be associated with the erection, construction, installation or acquisition of the proposed energy conservation project;

(iii) Project management and other similar costs may only account for up to 15 percent of the total qualifying project costs; and

(iv) Costs for employees’ or contractors’ work on the energy conservation project must be detailed and documented as to specific tasks, hours worked and compensation costs.

(F) Costs for legal counsel that is directly related to the development of an energy conservation project (excluding litigation, intellectual property, etc.);

(G) Costs of training associated with the energy conservation project that is approved by the department; and

(H) Other costs the department determines should be included.

(b) Qualifying project cost does not include:

(A) Interest and warranty charges;

(B) Litigation or other operational-related legal fees and court costs;

(C) Intellectual property search, application and filing payments;

(D) Donated, in-kind or volunteer labor and materials;

(E) Administrative costs to apply for grants, loans, tax credits or other similar funding for an energy conservation project including, but not limited to the tax credit review charge, costs associated with the creation and development of the certified public accountant verification letter and costs associated with securing a pass-through partner for the project;

(F) Routine operational, routine maintenance and repair costs associated with the energy conservation project;

(G) Expenses that are directly or indirectly offset with federal fee waivers;

(H) Expenses that are deemed not to have a benefit to the energy conservation project, including but not limited to, fines, penalties, entertainment, food, alcohol, gifts and lobbying; and

(I) Other costs the department determines should be excluded.

(c) If an energy conservation project serves more than one purpose, qualifying project cost includes only items needed to save energy. This includes new or replacement equipment that may cost more because of its energy saving features. The department may do inspections to verify qualified project costs.

(d) The department will calculate incremental cost as the cost above a department-determined reasonable minimum expected to construct a similar project without energy efficient features. Qualifying project cost will be limited to incremental cost for new facilities or for the replacement of facilities beyond their service life, including when a code, standard or other base system is required.

(A) In new construction and total building retrofit projects, qualifying project cost is the difference between building to code and building to meet or exceed the applicable standards.

(B) In other energy conservation projects, qualifying project cost is the difference between prevailing practices for that business or industry and a more energy efficient method.

(e) Qualifying project costs may be reduced by the following:

(A) The department will prorate, based on ASHRAE standards or as otherwise determined in these rules, the qualifying project cost based on the remaining service life of the equipment. If the baseline project has exceeded its service life, the department will consider only an incremental project eligible for a tax credit.

(i) Energy conservation projects must have a simple payback of greater than three years and less than the service life of the energy conservation project.

(ii) An applicant may submit, for department approval, a published or recognized standard to determine life expectancy. If a published or recognized standard is unavailable, the department may use a 15-year limit on life expectancy.

(B) Costs for a portion of or an entire energy conservation project that has previously received a tax credit or grant issued by the department.

(C) Costs to replace the same baseline energy conservation project more than once.

(D) The department may require that the baseline energy conservation project be specifically identified and permanently decommissioned.

(f) New construction, total building retrofit and small premium projects must provide cost information, but the department calculates the tax credit using a predetermined amount described in the applicable Opportunity Announcement.

(g) An applicant may incur qualifying project costs prior to the submission of an application, but may not begin installation or construction.

(5) The department will determine whether the project is a single energy conservation project, or is part of a larger project in combination with other applications.

(a) The department considers a single energy conservation project as one or more projects that are applied for within the same Opportunity Announcement, owned or controlled by the same person and located in the same building or structure.

(b) For the purposes of this subsection, “same person” includes subsidiary corporations and companies, other subsidiary business organizations or other entities owned or controlled by the same parent corporation but excludes equity-only financing partners.

(c) The department may reduce the potential tax credit award or deny the application if the department finds that the proposed project is not a single energy conservation project.

(6) If an application does not include all information needed to complete the technical review, the department may notify the applicant in writing, requesting additional information. If the department does not receive the requested information within 30 calendar days, the department may deny the application.

(7) The department will notify the applicant in writing if the department denies the application during the technical review.

(8) If the technical review determines that information submitted by the applicant during the competitive process was inaccurate, the department may deny the application.

Stat. Auth.: OL 2011, Ch. 730, Sec. 34 - 51

Stats. Implemented: OL 2011, Ch. 730, Sec. 34 - 51

Hist.: DOE 12-2011(Temp), f. & cert. ef. 12-23-11 thru 6-19-12

330-210-0080

Preliminary Certification

(1) The department may issue a preliminary certificate if it determines that the energy conservation project is technically feasible and capable of operating in accordance with the representations made by the applicant.

(2) The department may issue a tax credit that is less than the amount requested in the energy conservation project application, pursuant to statute and applicable rules.

(3) The sum of any incentives, grants, credits, other public funds and the energy conservation incentive may not exceed total project costs.

(4) The preliminary certificate will state the qualifying project cost, the potential amount of allowable tax credit and any conditions for claiming the credit.

(5) The applicant must report on the project’s status beginning one year from the issuing date of the preliminary certificate, if the department has not already received the project’s application for final certification. The applicant shall continue to submit project progress reports to the department every six months after the initial report until the department receives the project’s application for final certificate. Failure to submit reports may result in denial.

(6) A preliminary certification remains valid for a period of three calendar years after the date the department issues the preliminary certification or until the sunset of the program, whichever comes first.

Stat. Auth.: OL 2011, Ch. 730, Sec. 34 - 51

Stats. Implemented: OL 2011, Ch. 730, Sec. 34 - 51

Hist.: DOE 12-2011(Temp), f. & cert. ef. 12-23-11 thru 6-19-12

330-210-0090

Amendments to Preliminary Certifications

(1) The applicant must notify the department of any changes to the project proposal as described in the application for preliminary certification.

(2) Small premium projects are not eligible for amendments to informational filings.

(3) An applicant must declare all changes to the energy conservation project by the time the department receives the final certification application. Undeclared changes found in the application for final certification or through later inspection will result in denial of final tax credit certification.

(4) Applicants must submit amendments on the form specified in the Opportunity Announcement.

(5) The applicant must demonstrate that the energy conservation project, with the proposed change, would continue to be technically feasible, would operate as represented and would remain in operation for at least five years. The applicant has the responsibility to provide an amendment request with complete technical documentation that will support a case for the proposed amendment. The department may deny amendments submitted without such justification.

(6) An amendment may result in a reduction in tax credit, but may not increase the tax credit amount certified in the preliminary certificate.

(7) If an amendment request does not include all information needed to complete the review, the department may provide the applicant a written request for additional information. If the applicant does not provide the requested information to the department within 30 calendar days, the department may deny the amendment request.

(8) Requests for amendments must include payment of the appropriate fee. The department may accept non-substantive changes, such as change of responsible party information, without payment of the fee.

(9) The department will evaluate amendments to determine if the change would have affected the outcome of competitive review, which may result in denial of the amendment request.

(10) Within 60 calendar days after the date the department receives the amendment request, the department will decide whether to approve the request. If the department does not approve the amendment request within 60 calendar days, it is considered denied.

(a) If approved, the department will draft an amended preliminary certification, which may contain new or amended conditions and requirements.

(b) If denied, the department will notify the applicant in writing. The notice will include the reasons for the denial.

Stat. Auth.: OL 2011, Ch. 730, Sec. 34 - 51

Stats. Implemented: OL 2011, Ch. 730, Sec. 34 - 51

Hist.: DOE 12-2011(Temp), f. & cert. ef. 12-23-11 thru 6-19-12

330-210-0100

Final Certification

(1) An energy conservation project must be completed and operational prior to applying for a final certification. An applicant must submit amendments to preliminary certifications before or with the final certification application.

(2) The department will not review applications received after the expiration of the preliminary certification or without the final review fee.

(3) The applicant must submit the application on the current department-issued form and all sections must be completed.

(4) The department will review the application, and may conduct an inspection to verify:

(a) That the energy conservation project is complete and operating.

(b) Compliance with statute, rules, the relevant Opportunity Announcement and the preliminary certification or informational filing.

(c) Compliance with state and local regulations, including required licenses and permits.

(d) The lease or rental agreement if the infrastructure is leased or rented.

(e) That the property taxes for the project location are current.

(f) That the energy conservation project will be maintained and operated for at least five years.

(g) The total project costs for purchase and installation or construction of the energy conservation project were paid in full.

(A) A certified public accountant must attest to the total project cost, or if the total project cost is less than $50,000, the applicant must submit copies of receipts for the project.

(i) The certified public accountant cannot be the project owner nor permanently employed by the project owner or pass-through partner.

(ii) Receipts for proof of payment may include canceled checks, credit card statements, binding contracts and agreements.

(B) The application must show that contract and loan agreements directly related to the project are not in default.

(C) The application must include information regarding state and federal incentives applied for or received in connection with the project.

(h) Other information the department requires.

(5) If an application for final certification does not include all information needed to complete the final certification review, the department may ask the applicant, in writing to submit additional information. If the department does not receive the requested information within 30 calendar days of the date of the notice, the department may deny the application for final certification.

(6) The department will notify the applicant, in writing, if the department denies the application during final review. An applicant may submit a written request for reconsideration within 60 days after the department issues a decision on a final certification.

(7) The department will issue a final certification upon verification that the energy conservation project’s installation or construction is complete and that the project complies with statute, rules, the relevant Opportunity Announcement, the preliminary certification or informational filing, and any other applicable requirements.

(a) The department may issue a credit up to 35 percent of the certified project cost. The department may certify a lesser tax credit amount than approved in the preliminary certificate or reserved in the informational filing, but may not certify a greater amount.

(b) The sum of any incentives, grants, credits, other public funds and the tax credit may not exceed total project costs.

(8) The department will send a written notification to the applicant of its decision to issue a final certification within 60 days, after the department receives a complete application for final certification. If more than 60 days pass from the filing date of a complete application and the applicant has not received a written decision from the department, the application is rejected and no further action will be taken.

Stat. Auth.: OL 2011, Ch. 730, Sec. 34 - 51

Stats. Implemented: OL 2011, Ch. 730, Sec. 34 - 51

Hist.: DOE 12-2011(Temp), f. & cert. ef. 12-23-11 thru 6-19-12

330-210-0150

Compliance and Pass-through

All participants in this program are subject to OAR 330-230-0000 through 330-230-0140.

Stat. Auth.: OL 2011, Ch. 730, Sec. 34 - 51

Stats. Implemented: OL 2011, Ch. 730, Sec. 34 - 51

Hist.: DOE 12-2011(Temp), f. & cert. ef. 12-23-11 thru 6-19-12

330-230-0000

Applicability of Rules in OAR 330, Division 230

These rules provide procedures for compliance activities and pass-through transactions for the incentive programs established in House Bill 3672 (2011). The compliance rules in 330-230-0010 to 330-230-0060 apply to all applicants for energy incentive programs for energy conservation, transportation and renewable energy grants as governed by Oregon Laws 2011, chapter 730. The pass-through rules in 330-230-0110 to 330-230-0140 apply to all applicants for the energy incentive program for energy conservation projects as governed by Oregon Laws 2011, chapter 730, sections 34 through 51 and transportation projects as governed by Oregon Laws 2011, chapter 730, sections 52 through 66.

Stat. Auth.: OL 2011, Ch. 730, Sec. 34 - 51

Stats. Implemented: OL 2011, Ch. 730, Sec. 34 - 51

Hist.: DOE 12-2011(Temp), f. & cert. ef. 12-23-11 thru 6-19-12

330-230-0010

Definitions

For the purposes of 330-230-0010 to 330-230-0060 the following definitions apply:

(1) “Period of operation” means:

(a) For an Energy Conservation Project or a Transportation Project, five years from the date of issuance of the tax credit certificate.

(b) For a Renewable Energy Production System, five years from the date of final payment under the Performance Agreement.

(2) “Project” means the system, activity or facility under inspection or review by the department.

(3) “Project inspection” means a physical examination by the department of an Energy Conservation Project or a Transportation Project to determine if the project conforms to the Preliminary Certificate or application for preliminary certification.

(4) “Project review” means an examination by the department of the records, facilities, or operations of an applicant for a Renewable Energy Development grant.

Stat. Auth.: OL 2011, Ch. 730, Sec. 34 - 51

Stats. Implemented: OL 2011, Ch. 730, Sec. 34 - 51

Hist.: DOE 12-2011(Temp), f. & cert. ef. 12-23-11 thru 6-19-12

330-230-0020

Purpose of Inspection or Review

(1) The department may require project inspection or project review at any time from the date of initial application through the end of a project’s period of operation.

(2) Inspections or reviews may be conducted by the department to verify:

(a) The amount certified for a credit,

(b) Completion of a project,

(c) A project is operational,

(d) Ownership of a project,

(e) Compliance with the preliminary certificate or application for preliminary certification,

(f) Compliance with a performance agreement, or

(g) Compliance with ORS chapter 469 and any applicable rules or standards adopted by the director.

(3) The applicant or its designated representative must be present during the inspection or review.

Stat. Auth.: OL 2011, Ch. 730, Sec. 34 - 51

Stats. Implemented: OL 2011, Ch. 730, Sec. 34 - 51

Hist.: DOE 12-2011(Temp), f. & cert. ef. 12-23-11 thru 6-19-12

330-230-0030

Selection of Projects, Notice

(1) Criteria for selecting projects for inspection or review includes, but is not limited to, consideration of project cost, type, and location.

(2) The department will provide the applicant written notice of the inspection or review in advance of the planned inspection or review date.

Stat. Auth.: OL 2011, Ch. 730, Sec. 34 - 51

Stats. Implemented: OL 2011, Ch. 730, Sec. 34 - 51

Hist.: DOE 12-2011(Temp), f. & cert. ef. 12-23-11 thru 6-19-12

330-230-0040

Project Access

(1) The applicant must provide safe access to all areas of the project the department reasonably considers necessary to complete the inspection.

(2) The exact safety needs and requirements will be specific to each project and may include, but are not limited to, a secure ladder or stairs for access, and notice of any hazardous conditions.

(3) The department will not inspect a portion of a facility where the access provided presents, in the opinion of the department, an unreasonable risk to personal safety.

Stat. Auth.: OL 2011, Ch. 730, Sec. 34 - 51

Stats. Implemented: OL 2011, Ch. 730, Sec. 34 - 51

Hist.: DOE 12-2011(Temp), f. & cert. ef. 12-23-11 thru 6-19-12

330-230-0050

Inspection or Review Outcomes

(1) A project will pass inspection or review if sufficient information is available for the department to verify the statements made in an application, or conformance with conditions of a certification or performance agreement.

(2) The department may record that the inspected project has failed an inspection if:

(a) The applicant fails to provide a reasonable opportunity for the department to conduct an inspection or review,

(b) The applicant fails to provide sufficient and safe access to the project,

(c) The project is not operational,

(d) The applicant or project owner misses a scheduled inspection or review appointment without notice to the department,

(e) The project does not conform to the preliminary certificate, application for preliminary certification, ORS chapter 469 or any applicable rules or standards adopted by the director, or

(f) The project does not comply with the performance agreement.

Stat. Auth.: OL 2011, Ch. 730, Sec. 34 - 51

Stats. Implemented: OL 2011, Ch. 730, Sec. 34 - 51

Hist.: DOE 12-2011(Temp), f. & cert. ef. 12-23-11 thru 6-19-12

330-230-0060

Failed Inspections; Notice, Reconsideration

(1) The department may deny a tax credit or grant to, or may take action to recover any tax credit or grant already issued from, an applicant who has not resolved the issues identified in a failed inspection or review.

(2) The department will provide written notice to the applicant explaining the reason for a denial, suspension or revocation of a tax credit or grant due to a failed inspection or review..

(3) The applicant may request reconsideration of the failed inspection or review. A request for reconsideration must be received by the department within 30 calendar days of the date of the notice of failure.

(4) A request for reconsideration must include an explanation of why the applicant believes the project should pass inspection or review, a request for a new inspection or review, and payment of the required re-inspection fee.

(5) The department may waive all or part of the re-inspection fee if it denies the request for reconsideration or accepts the applicant’s explanation of special circumstances for the failure of the inspection or review.

Stat. Auth.: OL 2011, Ch. 730, Sec. 34 - 51

Stats. Implemented: OL 2011, Ch. 730, Sec. 34 - 51

Hist.: DOE 12-2011(Temp), f. & cert. ef. 12-23-11 thru 6-19-12

330-230-0110

Definitions

For the purposes of 330-230-0110 to 330-230-0140 the following definitions apply:

(1) “Pass-through amount” means the amount, equal to the present value of the credit calculated in accordance with the formula set out in OAR 330-230-0130, paid to an applicant in exchange for the right to claim the tax credit.

(2) “Pass-through partner” means an individual or business that pays the pass-through amount to an applicant and receives the tax credit in place of the applicant.

Stat. Auth.: OL 2011, Ch. 730, Sec. 34 - 51

Stats. Implemented: OL 2011, Ch. 730, Sec. 34 - 51

Hist.: DOE 12-2011(Temp), f. & cert. ef. 12-23-11 thru 6-19-12

330-230-0120

Pass-Through Eligibility

(1) An entity eligible to receive a tax credit may transfer the credit in return for a cash payment.

(2) An eligible person or business that pays the present value to purchase the approved tax credit from the applicant is eligible to claim the tax credit in place of the original applicant.

(3) A tax credit may be transferred one time only, from the applicant to an eligible pass-through partner.

Stat. Auth.: OL 2011, Ch. 730, Sec. 34 - 51

Stats. Implemented: OL 2011, Ch. 730, Sec. 34 - 51

Hist.: DOE 12-2011(Temp), f. & cert. ef. 12-23-11 thru 6-19-12

330-230-0130

Pass-Through Amount

(1) The following formulas will be used to calculate the present value of the tax credit for transfer purposes:

(a) For tax credits that may be claimed over 5 succeeding tax years, the formula is: Tax Credit Amount/[1 + (3(5 year Treasury yield rate) – 3 year net rate of change for the urban CPI for the west region)]^5 = Present Value

(b) For tax credits that may be claimed in one tax year the formula is: Tax Credit Amount/[1+2(2 year Treasury yield rate) + net rate of change for the urban CPI for the west region)]^1 = Present Value

(2) Using the formulas in (1)(a) and (b) of this rule, the department will review and recalculate the present value of the tax credit on a quarterly basis and will publish the results on the department’s web page. The department will use the rates in effect on the 15th of March, June, September and December. The department will not establish a present value greater than the tax credit amount.

(3) If an applicant elects to transfer the tax credit, the pass-through amount is determined by the present value calculation in effect on the date the department receives the complete application for preliminary certification or complete informational filing.

Stat. Auth.: OL 2011, Ch. 730, Sec. 34 - 51

Stats. Implemented: OL 2011, Ch. 730, Sec. 34 - 51

Hist.: DOE 12-2011(Temp), f. & cert. ef. 12-23-11 thru 6-19-12

330-230-0140

Pass-Through Process

(1) An applicant planning to transfer the tax credit must select the pass-through option on the preliminary or final certification application.

(2) If a pass-through partner has not been identified at the time of the preliminary certification application, the applicant must note “partner to be identified” and submit an updated application when the pass-through partner is identified.

(3) If an applicant chooses to transfer the tax credit, the application for final certification must include a complete, signed pass-through partner agreement form.

(4) When an applicant chooses to transfer a tax credit, the department may hold the application for final certification until pass-through partner information is received by the department. Any application in which the applicant has indicated a choice to transfer the tax credit is not a “completed application” until the department receives both the completed final certification application form and the completed pass-through partner agreement form for the tax credit, or portion of the tax credit, being transferred to that pass-through partner.

(5) If the tax credit is being transferred to more than one pass-through partner, an applicant has up to 18 months from the date the first pass-through partner agreement form is received by the department to begin each certification period for claiming the tax credit. For pass-through partner agreement forms received by the department after the 18-month period, the certification period begins 18 months from the date the first pass-through partner agreement form was received by the department. If the preliminary certification expires or otherwise becomes invalid during this period, the department will not certify any remaining tax credits.

(6) The department will not issue a tax credit certificate to a pass-through partner until the appropriate criteria, conditions and requirements of the preliminary certification and these rules are satisfied.

(7) For purposes of administering the sunset of the program, the department may issue a tax credit to an applicant, even though the applicant previously indicated a choice to transfer the tax credit to a pass-through partner, if the department has not received a completed application that includes the signed pass-through partner agreement form at least sixty days prior to the sunset date for the program. A tax credit will be issued to an applicant if the applicant and the project meet all applicable requirements and the only piece causing the application for final certification to be incomplete is the pass-through partner agreement form.

(8) The department will issue a tax credit certificate to the pass-through partner when the applicant confirms receipt of a payment equal to the present value of the tax credit and the applicant relinquishes any claim to the credit.

Stat. Auth.: OL 2011, Ch. 730, Sec. 34 - 51

Stats. Implemented: OL 2011, Ch. 730, Sec. 34 - 51

Hist.: DOE 12-2011(Temp), f. & cert. ef. 12-23-11 thru 6-19-12

 

Rule Caption: Prohibits increases in tax credits through amendments.

Adm. Order No.: DOE 1-2012(Temp)

Filed with Sec. of State: 1-13-2012

Certified to be Effective: 1-13-12 thru 7-10-12

Notice Publication Date:

Rules Amended: 330-090-0130

Subject: The rule amendment prevents applicants that apply to amend existing projects from increasing the amount of tax credit earned. house Bill 3672 removed the option to submit new applications for projects under BETC. Without this rule, prior BETC program applicants could seek amendments to increase the size of existing projects and thus subvert the intent of HB 3672 (2011) to stop new activity within the BETC program.

Rules Coordinator: Kathy Stuttaford—(503) 373-2127

330-090-0130

How the Oregon Department of Energy Processes a BETC Application

(1) General:

(a) The Director reviews a BETC application in two stages. The first stage is called preliminary certification. The second stage is called final certification. The final certification consists of the determination of eligible costs for purposes of the tax credit and the issuance of the BETC final certificate.

(b) To begin the review process for each stage, or to change the facility during the review process, an applicant must submit an application on the form approved by the Department. Applications for facilities that use or produce renewable energy resources, or are listed as renewable energy resources as defined under ORS 469.185, must be submitted under the tiered priority system described in OAR 330-090-0350 and include any additional requirements under this section.

(c) A facility owner planning to use a Pass-through Partner will select the pass-through option on the Application for Preliminary Certification.

(d) The Director may impose conditions in approving a preliminary or final certification that the facility must operate in accordance with the representations made by the applicant, and is in accordance with the provisions of ORS 469.185 to 469.225 and any applicable rules or standards adopted by the Director.

(e) If the Department determines that the applicant qualifies for a BETC, the Department may issue a preliminary certification. The preliminary certification may contain specific criteria and conditions for the facility to meet in order to obtain a final certification based on the information provided in the application for the BETC and type of facility that is described in the application. In addition, the Department may require the applicant to enter a performance agreement or other similar agreement as a condition of approval.

(2) Pre-Approval of Preliminary Certifications: The Director has pre-approved preliminary certifications for the following facilities that the Department has reviewed and determined to be otherwise qualified under these rules:

(a) Alternate energy devices qualifying for a tax credit under the Residential Energy Tax Credit Program, OAR 330-070-0010 through 330-070-0097, for which the Department has determined qualified costs, energy savings, and eligible tax credits. A facility owner may file for a preliminary certification to present documentation supporting different determinations for review and approval.

(b) Pre-qualified hybrid-electric vehicles.

(3) Preliminary Certification Review Process: Except as provided in OAR 330-090-0130(1) and (2), a completed application for preliminary certification shall be received by the Department on or prior to the erection, construction, installation or acquisition of a facility.

(a) Within 60 days after an application for preliminary certification is filed, the Director will decide if it is complete. An application is incomplete if it does not include information needed to demonstrate substantive compliance with the provisions of ORS 469.185 to 469.225 and any applicable rules or standards adopted by the Director. The Director will provide the applicant a written notice relating to the incomplete application and the information needed to make the application complete. If no action is taken within 30 days by the applicant, the application will expire.

(b) Within 120 days after a completed application is submitted the Director will notify the applicant of the status of the application, except as otherwise provided in subsection (5), if the applicant has not been notified otherwise the application has been denied.

(A) If it complies, the Director will approve the preliminary certification. The preliminary certification will state the amount of the costs that are eligible (eligible costs) for a BETC up to the maximum amount of certifiable costs under ORS 496.200. It may differ from the amount requested for reasons explained in the preliminary certification and based on these rules. Also, it will state any conditions that must be met before development, final certification, or some other event can occur. The Director will explain why each condition is needed to comply with these rules.

(B) If it does not comply, the Director will deny the application. No later than 60 days after the Director issues an order denying the application, the applicant may request reconsideration as provided in OAR 330-090-0133(4).

(C) An applicant can re-submit an application that is denied if features of the facility change, the applicant provides data the absence of which resulted in the denial, or other changes warrant. An application for preliminary certification can be amended or withdrawn by the applicant before the Director issues a preliminary certification. If an application is amended, the time within which review occurs starts over. An applicant may request reconsideration of an application denial under this rule.

(4) Preliminary Certification After Start of a Facility:

(a) If a facility has been started an applicant may file a written request with the Director for approval of a preliminary certification after facility start. Such a request must contain information in accord with OAR 330-090-0120 and 330-090-0130(5)(b).

(b) The Director may approve preliminary certification after facility start if:

(A) The request is in accord with OAR 330-090-0120;

(B) Special circumstances make application for preliminary certification before facility start up impracticable. Such circumstances include process delays beyond the applicant’s control, facility funding and energy supplies or markets; and

(C) The Director receives the waiver request within 90 days of facility start date. Under extraordinary circumstances the Director may extend the waiver period provided the facility serves the aims of the program.

(D) Failing to submit an application for preliminary certification before signing contracts for the facility does not constitute special circumstances supporting a waiver.

(5) How Preliminary Certification Can be Revoked: The Director may alter, condition, suspend, deny or revoke a preliminary certification for a reason listed in this section

(a) A facility is not completed and a complete final certification application received before 1,095 days (3 years) after the preliminary certification was issued or a further 730 days (2 years) if an extension has been approved.

(b) Permits, waivers, and licenses required by OAR 330-090-0120 are not filed with the Department before facility development starts.

(c) The facility undergoes changes without the changes being approved under OAR 330-090-0130(7).

(d) Any other reason allowed by the amendments to ORS 469.210 (3) in Oregon Laws, 2010, Chapter 76, Section 11.

(6) Amendments to Preliminary Certifications: To change a facility that has a preliminary certification and amend the preliminary certification, the applicant must file a written request with the Director prior to the project completion date.

(a) The request must describe the change to the facility and reasons for the change. It may include changes in cost, tax credit amount, facility design, and materials. The request may also include changes in the amount of energy saved or produced, jobs created, project financing, the applicant, the location, or other matters that demonstrate substantial change in the project’s scope. The request must be accompanied by the appropriate fee.

(b) If a request does not include information needed to demonstrate substantive compliance with the provisions of ORS 469.185 to 469.225 and any applicable rules or standards adopted by the Director, the department will provide the applicant a written notice relating to the information needed to make the request complete. If the applicant does not provide all of the requested information to the Department within 30 days, the request will expire and no changes will be made to the preliminary certification.

(c) Preliminary certifications issued for facilities using or producing renewable energy resources, or facilities listed as renewable energy resources as defined under ORS 469.185, shall not be eligible for consideration of amendments other than those listed below in (A) through (C). An eligible amendment cannot change the tier within which the application was reviewed.

(A) Equipment capacity within 10 percent of the approved specification;

(B) Amendments to the facility that do not result in an increased potential tax credit amount, but increase output or otherwise improve the facility; or

(C) Changes in ownership.

(d) Amendment requests received after January 13, 2012, will not be approved if the amendment would result in an increased tax credit.

(e) Within 60 days after the applicant files the change request, the Director will decide if the facility as modified complies with these rules.

(A) If it complies, the Director may issue an amended preliminary certification which may contain new or amended criteria, conditions and requirements.

(B) If it does not comply, the Director will issue an order that denies the change and provide written reasons for the denial.

(f) The amendments to ORS 315.354, 315.356 and 469.220 by Oregon Laws, 2011, Chapter 693 Section 1 do not provide a basis for applicants to obtain amendments to certifications issued under ORS 469.210 or 469.215.

(7) If the facility does not proceed: The applicant must inform the Director in writing if it does not proceed with the facility or proceeds without the tax credit. In that case, the Director will cancel the preliminary certification.

(8) Pass-through Option Process and Application:

(a) In addition to the application for preliminary certification, an applicant who plans to transfer the tax credit certificate to a Pass-through Partner must complete and file the Pass-though Option Application form supplied by the Department.

(b) If the Pass-through Partner is not yet secured at the time of the Application for Preliminary Certification, the facility owner will complete that section of the application by inserting “Partner to be identified” and will submit an updated application when the Pass-through Partner is secured.

(c) The Department will not transfer and issue a final certificate to a pass-through partner until the facility owner provides evidence to the Department that the owner has received the pass-through payment in full.

(9) Extension of Preliminary Certification: Applicants who have not previously extended their certification and whose preliminary certification is anticipated to expire prior to completion of the facility may apply for an extension of an additional two years from the current expiry of the preliminary certification.

(a) Applicants must submit a written request to the department, accompanied by the appropriate fee, describing the progress made in developing the facility since the department issued the preliminary certification and verifying that the project will be developed in accordance with the initial approval, within two years from the current end of the preliminary certification and prior to the sunset date of the program. The request shall include the new proposed facility completion date. Requests may be made no earlier than 6 months prior to the expiration of the existing preliminary certification.

(b) If an applicant wishes to make changes other than to the completion date, the applicant must submit a request for amendment as described in ORS 330-090-0130(7).

(c) If a request or original application does not include information needed to demonstrate substantive compliance with the provisions of ORS 469.185 to 469.225 and any applicable rules or standards adopted by the Director the department will provide the applicant a written notice specifying the information needed to make the request complete. If the applicant does not provide all of the requested information to the Department within 30 days, the request will expire and no extension will be made to the preliminary certification expiration date.

(d) The department will review the previously approved application against current statute and rules. Within 60 days after the department receives the extension request, the Director will decide if the request complies with these rules.

(A) If it complies, the Director may issue an amended preliminary certification which may contain new or amended criteria, conditions and requirements.

(B) If it does not comply, the Director will issue an order that denies the extension and provide written reasons for the denial.

(10)(a) Final Certification Review Process and Application: An application for final certification must be filed after the facility is completed as defined in these rules.

(b) An application for final certification must include:

(A) Evidence to demonstrate that:

(i) The facility complies with all conditions and criteria of the preliminary certification and with the provisions of ORS Chapter 469 and the rules adopted thereunder;

(ii) The facility remains in compliance with local, state, and federal laws, including local land use laws and with any conditions imposed by the local government as a condition of land use approval; and

(iii) The facility will be maintained and operated for at least five years after the facility is placed into operation, or a lesser period if approved and specified on the preliminary certification.

(B) An account of the facility costs, including prorated costs.

(i) If facility costs are less than $50,000, the account may be records of facility costs paid or incurred based on canceled checks, invoices, receipts, a binding contract or agreement, or other documentation as may be required under these rules unless required by the Director to supply verification from a certified public accountant, who is not otherwise permanently employed by the facility owner or pass-through partner. If an applicant has an outstanding binding contract or loan agreement, the account shall demonstrate that payments on contract or loan are not in default; or

(ii) If the facility costs are $50,000 or more, a certified public accountant, who is not otherwise permanently employed by the facility owner or pass-through partner, must complete a written review and summary of costs paid or incurred based on canceled checks, invoices, or receipts, a binding contract or agreement, or other documentation as may be required under these rules. If an applicant has an outstanding binding contract or loan agreement, the certified public accountant shall include sufficient information to demonstrate that accounts directly related to the facility are not in default.

(iii) The application must include information regarding any federal grants applied for or received in connection with the facility including, without limitation, the grant(s) applied for, the date of each application, the amount of the requested grant(s), when applicant expects to receive notice of grant approval or denial and any other information that may be required by the director. Final total costs will be reduced dollar for dollar by any federal grant amount received by a taxpayer in connection with the facility.

(C) For a Sustainable Building Practices Facility, a copy of the facility U.S. Green Building Council (USGBC) Rating Certificate, USGBC Final LEED™ Review, Energy Performance Documentation, Narrative for Energy and Atmosphere Credit 1, Annual Solar Income as described in the rules and method of calculation will be accepted in lieu of facility cost receipts.

(D) Proof the facility is completed and operating.

(E) If the facility is leased or rented, a copy of the lease or rental agreement.

(F) For Alternative Fuel Vehicle facilities, proof of conversion must include a copy of vehicle emission test performance results from DEQ or a conversion shop.

(G) Documentation that the applicant and facility owner or owners are current on their property taxes where the facility is located if appropriate; and

(H) Other data the Director finds are needed to assure a facility complies with these rules and conditions imposed in the preliminary certificate

(I) The names of the person or persons who are to be issued the final certificate. If the final certificate is to be issued to a pass-through partner, the Department will not issue the certificate until the appropriate criteria, conditions and requirements of the preliminary and final certification and these rules are satisfied.

Stat. Auth.: ORS 469.040 & 469.165

Stats. Implemented: ORS 469.185 - 469.225

Hist.: DOE 7-1985, f. 12-31-85, ef. 1-1-86; DOE 3-1989, f. 12-28-89, cert. ef. 1-1-90; DOE 4-1991, f. & cert. ef. 12-31-91; DOE 2-1992(Temp), f. 12-14-92, cert. ef. 12-15-92; DOE 2-1993, f. & cert. ef. 1-28-93; DOE 5-1993, f. & cert. ef. 12-14-93; DOE 2-1995, f. 12-12-95, cert. ef. 12-15-95; DOE 3-1996, f. & cert. ef. 11-27-96; DOE 2-1997, f. 12-15-97, cert. ef. 1-1-98; DOE 4-1998, f. 12-14-98, cert. ef. 12-15-98; DOE 2-1999, f. 12-22-99, cert. ef. 1-1-00; DOE 1-2001, f. 10-5-01, cert. ef. 10-8-01; DOE 2-2004, f. & cert. ef. 1-21-04; DOE 3-2004, f. & cert. ef. 7-1-04; DOE 1-2005, f. 12-30-05, cert. ef. 1-1-06; DOE 2-2006, f. 9-29-06, cert. ef. 10-1-06; DOE 3-2007, f. 11-30-07, cert. ef. 12-1-07; DOE 3-2008, f. & cert. ef. 3-21-08; DOE 4-2008, f. 6-19-08, cert. ef. 6-20-08; DOE 2-2009(Temp), f. & cert. ef. 11-3-09 thru 5-1-10; DOE 3-2010, f. & cert. ef. 4-30-10; DOE 4-2010(Temp), f. 5-21-10, cert. ef. 5-27-10 thru 11-2-10; Administrative correction 11-23-10; DOE 14-2010, f. & cert. ef. 11-23-10; DOE 3-2011(Temp), f. 4-15-11, cert. ef. 4-18-11 thru 10-14-11; DOE 6-2011, f. & cert. ef. 9-29-11; DOE 7-2011, f. & cert. ef. 10-25-11; DOE 1-2012(Temp), f. & cert. ef. 1-13-12 thru 7-10-12

Notes
1.) This online version of the OREGON BULLETIN is provided for convenience of reference and enhanced access. The official, record copy of this publication is contained in the original Administrative Orders and Rulemaking Notices filed with the Secretary of State, Archives Division. Discrepancies, if any, are satisfied in favor of the original versions. Use the OAR Revision Cumulative Index found in the Oregon Bulletin to access a numerical list of rulemaking actions after November 15, 2011.

2.) Copyright 2012 Oregon Secretary of State: Terms and Conditions of Use

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