State Policy Updates
Pennsylvania Policy Update
In late January, the BPA submitted comments urging Pennsylvania to move forward with joining the Regional Greenhouse Gas Initiative (RGGI), as a way to boost energy efficiency in the state and improve its current 41st state ranking in energy efficiency jobs. The period for public comment has now concluded and new legislation has been introduced in the Pennsylvania House of Representatives to create a carbon trading program (see HB 989 below). Meanwhile, a separate bill has been introduced to require approval from the legislature before joining RGGI.
Separately, the Pennsylvania Department of Environmental Protection (DEP) has announced that it is revamping the Green Energy Loan Fund (GELF) to make it easier for commercial property owners to get low-interest loans for large-scale, high-impact energy efficiency projects. Approximately $1.8 million is currently available in funding for local governments, businesses, school districts, hospitals, and nonprofit organizations which are eligible to apply for GELF loans and can find instructions and an application at Green Energy Loan Fund.
· HB 989 An Act Establishing the CO2 Budget Trading Program would direct funds from the sale of carbon allowances sold at auction through RGGI to methods designed to achieve an emissions-free power sector in the state by 2050. This includes establishing an Energy Transition Fund to achieve electricity bill reductions for low-income residents, additional investments in environmental justice communities, and transition assistance for workers and communities affected by the closure of power plants and other energy infrastructure. The bill was introduced on March 22 and will be considered in the Environmental Resources & Energy Committee.
·HB 637 Pennsylvania Carbon Dioxide Cap and Trade Act requires a process for legislative approval before Pennsylvania can join the Regional Greenhouse Gas Initiative (RGGI) or take any other action to control carbon dioxide emissions or create its own cap and trade program. Representative Struzzi reintroduced this legislation in the Environmental Resources and Energy Committee on February 24 and it has not yet seen a vote in committee.
·SB 199 Schools-to-Work Program awards grants to establish workforce training partnerships between schools, employers, and trade associations for the purpose of creating employment and training pathways. Applications for state grants for workforce apprenticeship programs must include a partnership with at least one school and pathways to registered certifications in new careers. The program was introduced in the Senate on February 10 and was referred to the Labor and Industry Committee.
Arizona Policy Update:
The Arizona Corporation Commission (ACC), which regulates utilities, is working to finalize and implement proposed rules that would require the power grid to be 100% carbon-free by 2050, and increase the energy efficiency resource standard (EERS) to 35% by 2035 (the state’s EERS is currently 22%). A final vote on the rules is forthcoming but has been challenged by state lawmakers concurrently working to pass legislation that would restrict the Commission’s power to set these standards (see HB 2248/ SB 1175 below). In early March, BPA submitted a letter to each member of the Arizona state legislature expressing concern that these bills would impact the future of Arizona’s energy efficiency programs which provide numerous benefits to Arizonans. The letter explained that energy efficiency programs administered through the state have delivered more than $1.4 billion in net economic benefits for Arizonians and created over 40,000 jobs in the state since 2010, urging the Legislature to vote no on a bill that could significantly harm Arizona’s economy and community.
Meanwhile, APS, the state’s largest electric utility, has been directed by the Commission to develop a tariff for aggregated DERs to compensate aggregators for the value of those resources (including smart thermostats, connected water heaters, and other energy efficiency and load management solutions) provide to the grid. The current expectation is for the tariff to be finalized next year, with benefits flowing to aggregators as well as consumers.
· HB 2248 / SB 1175 – Corporation Commission; Electric Generation Resources would prohibit the Arizona Corporation Commission (ACC) from adopting or enforcing a policy, decision, or rule that regulates the types of electric generation resources used by public service corporations. The legislation received backing from Governor Ducey, who expressed his support for limiting the power of the ACC, and was passed in the House along party lines in early March. Meanwhile, the Senate bill SB 1175 passed out of Committee but has not seen a vote on the Senate floor yet. The bill could ultimately be blocked from passage, given the split party-line vote, after one Republican Senator announced that he would not be supporting the bill.
· SB 1519 Energy Infrastructure Finance Authority establishes an Infrastructure Upgrade Finance Authority Board to develop programs for cost-effective infrastructure upgrades, including energy efficiency. The board will consist of 13 members, 7 of which members are appointed by the Governor and must include at least one member representing each of the nonprofit environmental, energy, low-income, financing, business, labor, and education sectors. The board will draft a 3-to-5-year infrastructure upgrade plan, issuing bonds to fund infrastructure projects and assisting energy providers to develop cost-effective energy efficiency and peak demand reduction programs, prioritizing energy audits to maximize energy efficiency and energy savings in the state. The Infrastructure Finance Authority Board is also tasked with providing educational and market resources focused on residential energy efficiency projects on its website.
Illinois Policy Update:
Despite aims to address a $3 billion deficit in the state budget, the Illinois state legislature still has a number of new efficiency mandates moving through the state assembly in an effort to modernize buildings, appliances, and electricity infrastructure.
· HB 0804 Clean Jobs Equity Act creates an Equity and Empowerment Clean Energy Advisory Board to administer workforce development programs and clean energy investment to move the state to 100% carbon-free electricity by 2030. The bill includes energy efficiency measures and building performance enhancements in Illinois. After a similar version of the legislation faced resistance in 2020, the bill was reintroduced in February by House Speaker Chris Welch and has since gained over 20 cosponsors and passed through the Energy & Environment Committee on March 15. The bill now awaits a vote on the House floor.
· HB 3101 Building Energy Performance Standard Act to decrease energy consumption, reduce greenhouse gas emissions from existing buildings, and increase economic growth and job creation. To this end, the bill creates a Building Energy Performance Standard and sets forth that all state-owned buildings must comply by January 1, 2028. The standard would also set minimum energy efficiency requirements for all state owned buildings over 10,000 square feet, and review and assess energy performance for all buildings in any government jurisdiction in the state, beginning January 1, 2023. The bill missed a key deadline for being reported out of committee and is now subject to the Rules Committee for further consideration.
· HB 2555 Appliance Efficiency Standards Act establishes minimum efficiency standards for high density energy, water, and air appliances for the home in accordance with ENERGY STAR requirements. The bill would prohibit the sale, rental, or lease of any non-compliant product after January 1, 2023. The legislation was introduced on February 17 and referred to the Energy and Environment Committee. After the deferred vote this month, the bill has also been re-referred to the Rules Committee for further consideration.
Kansas Policy Update:
As Kansas grapples with an intense winter and the aftermath of infrastructure damage, the Kansas state House of Representatives introduced legislation to enable Commercial Property Assessed Clean Energy (C-PACE) financing to drive energy efficiency improvements. Additionally, at the beginning of 2021, the Kansas Housing Resources Corporation partnered with the local utility, Kansas Gas Service, to provide home repair assistance of up to $5,000 to enable weatherization services.
· HB 2320 Commercial Property Assessed Clean Energy [C-PACE] Act establishes a C-PACE program in Kansas to enable financing for clean energy and energy efficiency improvements. Introduced on February 10 in the House, the bill has been referred to the Committee on Financial Institutions and Rural Development. This is the first time that the Kansas legislature has considered enabling legislation for C-PACE, and the bill has yet to receive a vote in committee.
Maine Policy Update
Through legislative action so far, it is clear that investment in energy efficiency and weatherization is on the forum to provide economic recovery for Maine. The House and Senate are utilizing their partnership with the Maine Public Utilities Commission and the Efficiency Maine Trust to incentivize energy efficiency improvements through tax exemptions, public funding, and the establishment of a C-PACE program, specified below.
· HP 396 An Act to Accelerate Weatherization Efforts in the State allows Efficiency Maine Trust funds to be used towards increased energy efficiency, reduced greenhouse gas emissions, and lower energy costs to achieve the weatherization of 17,500 homes and businesses by 2025, and 35,000 homes and businesses by 2030. The legislation also mandates that at least 1,000 low-income housing units are weatherized every year. The bill was introduced on February 22 and referred to the Committee on Energy, Utilities, and Technology where it held its initial hearing on March 16. The bill awaits a vote to be reported out of committee.
· HP 132 An Act to Exclude Energy Efficiency Improvements from Property Tax provides property tax exemptions for energy efficiency improvements made on personal property (including weatherization of residential, commercial, and industrial buildings and facilities) in the state. The legislation requires the Efficiency Maine Trust to identify a list of eligible improvements. Introduced on January 21, the Committee on Taxation the bill held its initial hearing on February 23 and two committee work sessions to consider amendments. However, the bill awaits a vote to pass out of committee.
· SP 147 An Act to Allow for the Establishment of Commercial Property Assessed Clean Energy Programs allows the Efficiency Maine Trust or a relevant municipality to establish a C-PACE program to enable financing for clean energy and energy efficiency improvements through assessment contracts between lenders and property owners. Maine considered C-PACE legislation for the first time in 2019, but never made it out of committee. The 2021 C-PACE bill was introduced in the Senate in February and held its initial hearing on February 25 in the Committee on Energy, Utilities, and Technology. On March 23, the committee held a work session to consider the legislation but it has not yet received a vote to make it out of committee and onto the Senate floor.
Maryland Policy Update
On February 15, Governor Hogan signed the RELIEF Act of 2021, devoting $1.5 billion to tax relief and grants for small businesses and direct payments to low-income Marylanders. Meanwhile, there has been significant focus in the General Assembly on issues relevant to our industry including climate, energy efficiency, and workforce development. Significantly, the legislature is working on a sweeping climate bill that mandates new statewide greenhouse gas reduction goals, increased statewide annual energy savings, efficiency requirements for building renovations, and net-zero new school construction. In addition, bills on apprenticeships, energy efficiency mandates and tax credits, and indoor air quality have all been up for consideration in the 2021 legislative session which is scheduled to end on April 12.
·SB 414 / HB 583 Climate Solutions Now Act of 2021 would raise the state’s greenhouse gas emissions reduction target to 60% by 2030 and net-zero by 2045. The bill increases statewide energy efficiency requirements through the Maryland EmPOWER program from 2% annual energy savings to 2.75% by 2027, establishes efficiency requirements for major renovations on large commercial buildings, and sets net-zero requirements for certain new school construction.
The legislation also creates a Commission on Environmental Justice and Sustainable Communities to establish a Just Transition Employment and Retraining Working Group, which will include two representatives of registered apprenticeship sponsors. The bill passed through the Senate in March and subsequently had an initial hearing in the House Environment & Transportation Committee on March 31.
·SB 198 / HB 74 Income Tax Credit for Energy Efficiency Upgrades - Passive Houses would create a state income tax credit for homeowners who invest in energy efficiency upgrades, including insulation, duct sealing, and window replacement. The tax credit would cover 10% of the costs, up to $2,000. Introduced in previous sessions, the bill again struggled to get adequate support this year and did not make it out of committee in the House or Senate.
· SB 462 / HB 379 Low-Income Housing Energy Performance Targets would establish a low-income goal for the EmPOWER program, requiring the Department of Housing and Community Development (DHCD) to procure or provide energy efficiency and conservation programs and services for low-income households to achieve 1% gross annual energy savings starting in 2022. The bill was reintroduced this session after failing to advance last year and again was not able to make it out of committee this year.
· HB 0778 Income Tax Healthy Indoor Air Quality Tax Credit would create a new income tax credit for homeowners and small businesses who invest in HVAC improvements, including enhanced filtration, ventilation, and bipolar ionization, that can both help address COVID and improve indoor air quality and health over the long term, and which must be installed by a Maryland-licensed HVAC contractor. The proposed tax credit is for 50% of the cost of eligible systems, not to exceed $1,000 for residential properties or $2,000 for small businesses, and was amended to require that 30% of the residential tax credits go to low-income households. Introduced for the first time this session, the bill was not able to make it out of committee.
· SB 0845 / HB 0905 Workforce Development Sequence Scholarships Eligibility amends the state-funded Workforce Development Sequence Scholarship to broaden the definition of eligible students to include those enrolled directly in registered apprenticeship programs that partner with community colleges. The alterations will expand access to registered apprenticeship programs like those in the HVAC industry, helping students who otherwise would not be able to afford the tuition. The bill has passed in the House and Senate, and now awaits reconciliation of the slight differences between the two versions of the bill in order to be sent to the Governor’s desk before the last day of session on April 12.
New Jersey Policy Update
In March, Governor Murphy extended the moratorium on utility service shutoffs through the end of June. While a critical safeguard for struggling families, some stakeholders are also raising concerns that it may compete with energy efficiency for limited state funding. In the meantime, New Jersey continues to encourage residential and commercial weatherization and energy efficiency efforts this year, including with new movement on a bill to update appliance standards (SB 3324 / A 5160) and continued work on C-PACE legislation. C-PACE legislation, introduced in early 2020, was stalled by the pandemic. However, the bill has been reintroduced by Senator Smith and Assemblyman Mukherji. The current holdup over the legislation lies in debate over program timelines (shortening the EPA period from 365 to 180 days) and challenges around local bonding.
·S 3324 / A 5160 An Act Establishing Minimum Energy and Water Efficiency Standards sets updated efficiency standards on home appliances sold and installed in New Jersey, which has not established new energy and water efficiency standards since 2005. New state standards would be imposed on 19 products to comply with energy efficient standards such as ENERGY STAR and WaterSense specifications. The legislation passed through both the House and Senate Committees in early March and currently awaits a floor vote.
·S 1953 An Act Concerning the Implementation of Renewable Energy and Energy Efficiency Systems directs the Economic Development Authority to establish a C-PACE program to enable financing for clean energy and energy efficiency improvements through assessment contracts between lenders and property owners. C-PACE legislation, introduced in early 2020, was stalled by the pandemic. However, the bill has been reintroduced by Senator Smith and Assemblyman Mukherji. The current holdup over the legislation lies in debate over program timelines (shortening the EPA period from 365 to 180 days) and challenges around local bonding. The bill has remained in committee as lawmakers continue to work through issues on local bonding authority
· S 3033 An Act establishing the School and Small Business Energy Efficiency Stimulus Program calls for the Board of Public Utilities (BPU) to establish and administer a School and Small Business Energy Efficiency Stimulus Program for the purpose of providing grants to education boards and small businesses for the installation of certain HVAC systems and energy efficient appliances to improve indoor air quality and efficiency in schools and small businesses, including in underserved communities. The legislation passed in the Senate in February and was referred to the House Telecommunications and Utilities Committee where it was subsequently amended to extend application deadlines.
Colorado Policy Update
As the state battles repercussions from inclement weather, the legislature has sought to expand workforce apprenticeships and training opportunities.
· SB 119 Increasing Access to High-Quality Credentials provides financial incentives for school districts to fund and offer scholarships for high school students who enroll in registered apprenticeships, internships, or construction programs which result in credentials for high skill, high wage, in-demands jobs. The bill was introduced in the Senate in February and referred to the Appropriations Committee. It will have a bill hearing on April 1.
· HB 1007 State Apprenticeship Agency establishes the State Apprenticeship Agency to oversee registered apprenticeship programs, including programs for the building and construction trades. The bill has passed out of the House Business Affairs and Labor Appropriations Committee with an amendment requiring a focus on accelerating new apprenticeship programs on a geographically diverse basis. It is now under consideration in the House Appropriations Committee.
Connecticut Policy Update:
Due to increased awareness regarding barriers to weatherization for low-income residents, Connecticut is looking to reallocate federal funding under Low-Income Home Energy Assistance Program (LIHEAP) to address health and safety barriers that prevent households from accessing weatherization, and fund more weatherization upgrades. The state legislature is seeking to redirect $8 million to the Department of Energy and Environmental Protection’s (DEEP) energy efficiency retrofit programs. Additionally, on the state budget side, DEEP announced the approval of the 2021 Plan Update to the 2019-2021 Conservation and Load Management plan, which includes demand response programs, heat pumps, the Home Energy Solutions program (HES), workforce development. One notable change is a new requirement to prioritize the targeting of the HES and HES Income-Eligible programs to those with the largest arrearages and the most frequent shut-offs and to require reporting on this topic.
· SB 356 To require the Department of House to Establish a Housing Energy Efficiency Retrofit Program creates a state grant program to fund the installation of energy efficiency upgrades in affordable housing. Grants are awarded to residential and commercial property owners who use the services of certified home energy auditors and local contractors. The bill was introduced in February and passed unanimously out of the Senate Joint Committee on Housing on March 9. It is scheduled for a vote on the Senate floor in April.
· SB 863 An Act to Establish and Update State Appliance and Equipment Energy and Water Efficiency Standards updates state building codes and mandates new efficiency standards for energy appliances such as ventilation systems, refrigeration, lighting, and water controls. The bill had a hearing on February 18 in the Joint Committee on Energy and Technology. However, the bill has seen no action in committee since February.
Ohio Policy Update:
In March, the Public Utilities Commission of Ohio (PUCO) filled its vacant position for Commissioner when Governor DeWine appointed Republican Jenifer French to serve until 2024. In other news, late last year, the Ohio legislature passed House Bill 6 which cut short the state’s utility energy reduction mandates from 22.5 % by 2027 to 17.5 % (a level at which they already have achieved). These changes also cut short state-supported utility energy efficiency programs including rebates for energy-efficient appliances and smart energy meters and funding for residential weatherization and energy audits. However, legislation in the Senate is seeking to repeal the legislation and continue funding for these programs. After BPA actively sought to stop the passage of HB 6 in 2019, this bill is another important opportunity to emphasize the benefits of energy efficiency programs for Ohio. In the meantime, utilities must determine if they plan to continue administering energy efficiency programs without state mandates.
· SB 44 Repeal HB 6 of the 133rd General Assembly seeks to continue funding and state programs pertaining to energy efficiency provided through electric utilities designed to retrofit and upgrade homes for energy savings and peak demand reduction. Introduced on February 2, the bill passed in the Senate on March 3 and was referred over to the House Committee on Public Utilities.
Oregon Policy Update:
The Oregon Public Utility Commission (OPUC) has been working to update commercial energy building codes, in response to an executive order issued by the Governor last year to adopt energy efficiency goals for new commercial buildings to achieve a 60% reduction in new building energy consumption by 2030. The new commercial building energy codes take effect on April 1, 2021, with a 6-month grace period. These efforts by OPUC align with some of the efforts underway in the state legislature described below.
· HB 2398 Relating to Building Codes adopts a building code that increases energy efficiency in newly constructed, reconstructed, and altered buildings. Introduced in January, the bill had a hearing on March 1 in the House Energy & Environment Committee where it now awaits a vote.
· HB 2062 Relating to Energy Efficiency Standards authorizes the Oregon Department of Energy to increase energy efficiency standards for household energy and water appliances such as dishwashers, refrigeration, and heating systems. The legislation passed in the Energy and Environment Committee on March 10 and is set for a vote on the House floor in early April.
Virginia Policy Update:
The Virginia General Assembly adjourned for the year on March 1. Before closing, the legislature passed the Commonwealth Clean Energy Policy which sets a goal of net-zero statewide emissions by 2045, allocating substantial investment in building and home performance measures to achieve clean energy, including through an updated state building code (noted below).
·SB 1284 Commonwealth Clean Energy Policy sets out the energy policy and objectives of the Virginia Commonwealth Clean Energy Policy, which include addressing climate change and enhancing resilience by reaching net-zero emissions by 2045 in all sectors, including the electric power, transportation, industrial, agricultural, building, and infrastructure sectors. The legislation was signed into law by Governor Northam on March 26.
·HB 1937 Green New Deal Act would require the state to achieve a 36% reduction in energy consumption from buildings by 2036, in addition to 80% clean electricity by 2035. To support this goal, the legislation devotes 40% of the revenue from the carbon cap and trade system with RGGI to low-income energy efficiency programs. Ultimately, the bill was not taken up by the committee before the deadline.
· HB 2227 / SB 1224 Uniform Statewide Building Code amendments for Energy Efficiency and Conservation directs the Board of Housing and Community Development to consider updating the state’s building energy codes for residential and commercial buildings, upon each publication of the International Energy Conservation Code (IECC). The bill creates an opportunity for stakeholders to address any issues with Virginia’s building energy codes, with a focus on energy savings and air quality benefits. Passing through the House on February 5, the House bill was also approved on the Senate floor on March 15. The Governor officially approved the legislation into law on March 30.
West Virginia Policy Update:
The West Virginia legislature has proposed two bills in an effort to deliver clean energy to the state through energy efficiency and cost-savings for buildings.
· HB 2667 A Bill to Create a Cost Saving Program for State Buildings regarding Energy Efficiency creates a new program to reduce energy usage in all state buildings by 25% by 2030. The legislation establishes funding for audits and energy-saving projects including HVAC and lighting replacements on state property. The bill was introduced in the House on February 2 and subsequently passed on the House Floor on March 30. It was then referred to the Senate Finance Committee where it currently awaits a vote.
· HB 2588 WV Energy Efficiency Jobs Creation Act sets goals to expand energy efficiency programs in West Virginia and achieve energy efficiency, conservation, and demand response targets which include nine percent reduction in peak demand levels from 2019 by 2032. To do so, the Public Service Commission requires each utility to establish energy efficiency rebate and loan programs. The legislation was introduced in the House Energy and Manufacturing Committee on February 17 but it has not seen a committee hearing or vote since that date.
District of Columbia Policy Update:
The D.C. Public Service Commission (PSC) is taking steps to modernize and green the city’s electricity system. On March 18, the PSC ordered utility company Pepco to deliver 5% of its electricity from renewable sources by 2024. In doing so, the District becomes the first jurisdiction in the Mid-Atlantic to require a long-term renewable power purchase agreement for its default utility service plan.
Meanwhile, in a positive development for data access, on March 25 the PSC moved to reconvene a working group to consider the implementation of Green Button Connect My Data and require Pepco to provide key information by late April including on feasibility, cost, technological capabilities, and timelines for implementation. The PSC has specifically required that Pepco provide “proposals on how market participants can obtain customer consent to share customer information with third parties.”
Finally, the D.C. Department of Energy & Environment (DOEE) launched a new grant program in January to fund the development and delivery of industry specific training to meet the District’s Energy Conservation Code (ECC) requirements in residential buildings, and provide capacity building and business development support to small enterprises that will enable them to deliver increasingly higher levels of energy performance in District homes. The project seeks to fund a grantee that can collaborate with as many as possible small local enterprises including contractors, construction, and design businesses, to enable them to provide increasing levels of energy efficiency to homeowners for the construction and retrofitting of their homes.
· Implementation of Building Energy Performance Standards (BEPS) - In 2018, DC passed comprehensive clean energy legislation which included the creation of Building Energy Performance Standards (BEPS) to set a minimum threshold of energy performance for existing commercial/public buildings. The first set of standards (BEPS Period 1) went into effect on January 1. The BEPS applies to all privately-owned buildings with at least 50,000 square feet and all DC-owned buildings with at least 10,000 square feet, and it will be updated in 6 years to apply to smaller buildings.