SECTION 1.  Chapter 21A of the General Laws, as appearing in the 2012 Official Edition, is hereby amended by inserting after Section 22 the following new section:-

Section 22A.  (a) Subject to section 22 of chapter 21A, not less than 80 per cent of amounts generated by the carbon dioxide allowance trading mechanism established under the Regional Greenhouse Gas Initiative Memorandum of Understanding, as defined in subsection (a) of section 22, and the NOx Allowance Trading Program shall be used to equitably fund (i) electric energy efficiency programs reviewed and approved by the department of public utilities under chapter 25; and (ii) electric energy efficiency programs administered by MLP Program Administrators subject to section 16 of chapter 25A.

SECTION 2.  Section 19 of Chapter 25 of the General Laws, as so appearing, is hereby amended by striking out subsection (a) and inserting in place thereof the following subsection:-

(a) The department shall require a mandatory charge of 2.5 mills per kilowatt-hour for all consumers, except those served by a municipal lighting plant, to fund energy efficiency programs including, but not limited to, demand side management programs. The programs shall be administered by the electric distribution companies and by municipal aggregators with energy plans certified by the department under subsection (b) of section 134 of chapter 164. In addition to the aforementioned mandatory charge, such programs shall also be funded, without further appropriation, by: (1) amounts generated by the distribution companies and municipal aggregators under the Forward Capacity Market program administered by ISO-NE, as defined in section 1 of chapter 164; and (2) cap and trade pollution control programs, including, but not limited to, and subject to section 22 of chapter 21A, funding allocated under section 22A of chapter 21A; and (3) other funding as approved by the department after consideration of: (i) the effect of any rate increases on residential and commercial consumers; (ii) the availability of other private or public funds, utility administered or otherwise, that may be available for energy efficiency or demand resources; and (iii) whether past programs have lowered the cost of electricity to residential and commercial consumers. In authorizing such programs, the department shall ensure that they are delivered in a cost-effective manner capturing all available efficiency opportunities, minimizing administrative costs to the fullest extent practicable and utilizing competitive procurement processes to the fullest extent practicable.

SECTION 3.  Chapter 25A of the General Laws, as so appearing, is hereby amended by inserting after Section 15 the following new section:-

Section 16.  (a) The following term as used in this section shall have the following meaning:

“MLP Program Administrator”, means the Massachusetts Municipal Wholesale Electric Company established under Chapter 775 of the Acts of 1975, Energy New England LLC or their successors as determined by participating municipal lighting plants.

(b) To be eligible for funding under section 22A of Chapter 25 a MLP Program Administrator shall annually submit the following to the department: (1) a report of projected program expenditures and program savings, and (2) upon completion of each program year, a report of program activities, program expenditures and program savings.  Such reports shall be consistent with the evaluation, measurement and verification requirements of the energy efficiency programs administered by the electric distribution companies and municipal aggregators under chapter 25.

(c) MLP Program Administrators shall be responsible for ensuring that energy efficiency programs funded from proceeds generated by the Regional Greenhouse Gas Initiative align with those administered by the electric distribution companies and municipal aggregators under Section 21 of Chapter 25, and are, thus, eligible to be counted toward the Commonwealth’s overall energy savings goals, including those related to emissions reductions.

(d) Provided that a MLP Program Administrator has complied with subsections (b) and (c), has not made an election under subsection (e), and has not otherwise poorly managed its programs, the department shall transfer funds periodically to the MLP Program Administrators, subject to sections 22 and 22A of Chapter 21A, in such manner, and within such time as the transfer of funds for programs administered by electric distribution companies and municipal aggregators under section 21 of Chapter 25.  The department may adjust transfers to reconcile for projected expenditures and actual expenditures in a previous program year.

(e) Any municipal light plant or MLP Program Administrator may annually, at its option, elect not comply with the requirements of this section and not to receive funding for energy efficiency programs under section 22A of Chapter 25.  In the event of such election such municipal lighting plant would not be subject to any energy efficiency and demand side management programs requirements, if any, established under this section.

(f) Any amounts distributed under and received by municipal lighting plants or MLP Program Administrators under this section and section 22A of Chapter 21A shall not subject municipal lighting plants to any other general or special law except this section and section 22A of Chapter 21A.