First Regular Session
Seventy-fourth General Assembly
STATE OF COLORADO
REREVISED
This Version Includes All Amendments
Adopted in the Second House
LLS NO. 23-0601.01 Jennifer Berman x3286
HOUSE BILL 23-1252
House Committees Senate Committees
Energy & Environment Transportation & Energy
Appropriations Appropriations
A BILL FOR AN ACT
C
ONCERNING THE IMPLEMENTATION OF MEASURES TO ADVANCE101
THERMAL ENERGY SERVICE .102
Bill Summary
(Note: This summary applies to this bill as introduced and does
not reflect any amendments that may be subsequently adopted. If this bill
passes third reading in the house of introduction, a bill summary that
applies to the reengrossed version of this bill will be available at
http://leg.colorado.gov
.)
Section 2 of the bill authorizes the Colorado energy office to
award grants for retrofitting existing buildings for installation of a
geothermal system for heating and cooling under the single-structure
geothermal grant that the office administers and for generating
geothermal energy through direct air capture technology under the
geothermal electricity generation grant that the office administers.
SENATE
3rd Reading Unamended
May 3, 2023
SENATE
2nd Reading Unamended
May 2, 2023
HOUSE
3rd Reading Unamended
April 21, 2023
HOUSE
Amended 2nd Reading
April 19, 2023
HOUSE SPONSORSHIP
Lieder and Kipp, Amabile, Bacon, Bird, Boesenecker, Brown, Daugherty, deGruy
Kennedy, Dickson, Hamrick, Herod, Joseph, Lindsay, Lindstedt, Lynch, Mabrey, McCluskie,
McCormick, McLachlan, Michaelson Jenet, Parenti, Pugliese, Ricks, Snyder, Soper, Story,
Taggart, Titone, Valdez, Velasco, Vigil, Willford, Young
SENATE SPONSORSHIP
Exum and Hansen, Ginal, Mullica, Priola, Sullivan, Winter F.
Shading denotes HOUSE amendment. Double underlining denotes SENATE amendment.
Capital letters or bold & italic numbers indicate new material to be added to existing law.
Dashes through the words or numbers indicate deletions from existing law. Section 3 establishes labor standards for thermal energy public
projects that a state agency or a state institution of higher education
procures.
In Colorado, a gas distribution utility providing gas service to more
than 90,000 retail customers is required to file with the public utilities
commission (commission) a clean heat plan, which is a plan
demonstrating how the utility will use clean heat resources to meet clean
heat targets for reducing carbon dioxide and methane emissions. Section
4 adds thermal energy as an eligible clean heat resource for helping to
meet clean heat targets.
Section 5 authorizes a gas utility that is regulated by the
commission to apply for review and approval of the use of thermal energy
networks in the gas utility's service area. A gas utility that is regulated by
the commission and that serves more than 500,000 customers is required
to propose pilot thermal energy network projects for the commission's
review and approval. The commission shall initiate a proceeding on or
before January 1, 2025, to determine if rule-making or legislative changes
are needed to facilitate the development of thermal energy in the state.
Section 6 repeals the "Geothermal Heat Suppliers Act", which act
requires geothermal heat suppliers to obtain operating permits from the
commission.
Be it enacted by the General Assembly of the State of Colorado:1
SECTION 1. Legislative declaration. (1) The general assembly2
finds that:3
(a) Colorado adopted Senate Bill 21-264, enacted in 2021, that4
requires regulated gas utilities to develop a clean heat plan to meet a four5
percent reduction below 2015 greenhouse gas emission levels by 20256
and a twenty-two percent reduction below 2015 greenhouse gas emission7
levels by 2030;
and8
9
(b) Gas utility workers have helped provide reliable energy10
throughout the state. Affording gas utilities a pathway to providing11
thermal energy service in the state also provides gas utility employees an12
opportunity to utilize many of their existing skills for clean energy jobs13
1252-2- for the utility.1
(c) Colorado residential and business utility customers have been2
affected by recent trends in gas prices. Helping these utility customers3
shift from gas to clean thermal energy service could provide long-term4
price stability for heating and cooling their homes and businesses and for5
heating water in their homes and businesses.6
(d) The use of thermal energy networks can help reduce7
greenhouse gas emissions from buildings and enhance resilience while8
supporting beneficial electrification. Utility-scale thermal energy projects9
and investments can especially help the state achieve these goals.10
(2) The general assembly declares that:11
(a) Requiring gas utilities to present different approaches for cost12
recovery of investments in thermal energy service, and requiring the13
public utilities commission to consider the cost to customers under each14
approach presented, will help minimize the long-term cost to utility15
customers for the cost of transitioning to clean thermal energy service;16
(b) It is important to pursue the decarbonization of buildings in the17
state in a manner that:18
(I) Is affordable and accessible;19
(II) Preserves existing living-wage jobs while also creating new20
living-wage jobs; and21
(III) Retains the knowledge and experience of the existing utility22
union workforce;23
(c) Passage of this act is intended for the purposes of:24
(I) Removing the legal barriers to utilities' development of thermal25
energy networks;26
(II) Requiring the public utilities commission to evaluate utilities'27
1252
-3- development of thermal energy networks; and1
(III) Immediately commencing the piloting of thermal energy2
network projects by certain utilities; and3
(d) In evaluating a gas utility's application to provide thermal4
energy service, the public utilities commission should consider any5
potential that the utility may have to reuse existing infrastructure that6
otherwise would result in stranded assets.7
SECTION 2. In Colorado Revised Statutes, 24-38.5-118, amend8
(4)(a) introductory portion, (4)(a)(I), (4)(a)(II), (4)(a)(IV), and (4)(c)(II)9
as follows:10
24-38.5-118. Geothermal energy grant program - creation -11
procedures - fund - report - definitions - repeal. (4) Grants -12
limitations - qualifications. The grant program consists of three types of13
grants:14
(a) The single-structure geothermal grant, which is awarded to15
applicants that are constructing a new building
OR RETROFITTING AN16
EXISTING BUILDING, including a single-family or multifamily residence,17
and that are
installing a geothermal system for use as the primary heating18
and cooling system for the building. A single-structure geothermal grant19
is subject to the following limitations and qualifications:20
(I) A developer or geothermal installer is eligible for grants for the21
construction
OR RETROFITTING of no more than one hundred residential22
buildings;23
(II) Commercial buildings and state and local government24
buildings that are constructed
OR RETROFITTED using grant money must25
meet the standards of the 2021 International Energy Conservation Code,26
or subsequent edition of the code;27
1252
-4- (IV) The office shall determine the amount of each grant based on1
per-ton heating capacity as follows; except that the office may change a2
grant award amount after the first year if the office determines that3
changes are necessary to advance geothermal development:4
(A) A nonresidential building constructed
OR RETROFITTED by a5
for-profit entity qualifies for up to two thousand dollars per ton of heating6
capacity;7
(B) A nonresidential building constructed
OR RETROFITTED by a8
nonprofit entity qualifies for up to three thousand dollars per ton of9
heating capacity;10
(C) A multifamily residence constructed
OR RETROFITTED by a11
for-profit entity qualifies for up to two thousand dollars per ton of heating12
capacity;13
(D) A multifamily residence constructed
OR RETROFITTED by a14
nonprofit entity qualifies for up to three thousand dollars per ton of15
heating capacity; and16
(E) A single-family residence, including a residence within a17
townhome or condominium building, qualifies for two thousand dollars18
per ton of heating capacity; and19
(c) The geothermal electricity generation grant, which is awarded20
to support the development of geothermal electricity generation and21
projects that pair geothermal electricity generation with electrolyzers for22
the production of hydrogen from geothermal generation. A person may23
apply for more than one cost-matching grant in a year. A geothermal24
electricity generation grant is subject to the following limitations and25
qualifications:26
(II) For applications for a grant to help fund a study to identify27
1252
-5- and explore resources that may be suitable for geothermal electricity AND1
ENERGY generation, costing up to one million dollars, the office may2
award a grant of up to fifty percent of the study cost; except that, if the3
project includes the production of hydrogen from electricity generated4
using geothermal energy
OR THE UTILIZATION OF DIRECT AIR CAPTURE5
TECHNOLOGY, the office may award a grant of up to sixty percent of the6
study
cost. ANY STUDY FUNDED PURSUANT TO THIS SUBSECTION (4)(c)(II)7
MUST INCLUDE AN EVALUATION OF THE RESOURCES ' SAFETY, ECONOMIC8
FEASIBILITY, COST EFFICIENCY COMPARED TO RENEWABLE ENERGY9
ALTERNATIVES, ENVIRONMENTAL IMPACTS, GREENHOUSE GAS AND AIR10
POLLUTION EMISSIONS, QUALITY JOB CREATION OPPORTUNITIES, AND11
IMPACTS TO NEIGHBORING COMMUNITIES .12
SECTION 3. In Colorado Revised Statutes, add 40-3.2-105.7 as13
follows:14
40-3.2-105.7. Labor standards for state thermal energy15
network and thermal energy system projects - definitions. (1) A
NY16
THERMAL ENERGY NETWORK OR THERMAL ENERGY SYSTEM PROJECT THAT17
AN AGENCY OF GOVERNMENT OR A STATE INSTITUTION OF HIGHER18
EDUCATION PROCURES AND THAT IS A PUBLIC PROJECT MUST COMPLY19
WITH:20
(a) T
HE APPRENTICESHIP REQUIREMENTS SET FORTH IN SECTION21
24-92-115
IF THE ESTIMATED CONTRACT COST FOR THE PUBLIC PROJECT IS22
ONE MILLION DOLLARS OR MORE ; AND23
(b) P
ART 2 OF ARTICLE 92 OF TITLE 24 CONCERNING PREVAILING24
WAGES FOR PUBLIC PROJECTS IF THE ESTIMATED CONTRACT COST FOR THE25
PUBLIC PROJECT IS FIVE HUNDRED THOUSAND DOLLARS OR MORE .26
(2) ANY THERMAL ENERGY NETWORK OR THERMAL ENERGY27
1252
-6- SYSTEM PLUMBING AND ELECTRICAL WORK PERFORMED IN THE STATE1
SHALL:2
(a) BE PERFORMED BY LICENSED PLUMBERS , LICENSED3
ELECTRICIANS, OR SUPERVISED APPRENTICES AT A RATIO NO GREATER4
THAN THREE APPRENTICES FOR EACH LICENSED MASTER OR JOURNEYMAN5
PLUMBER OR ELECTRICIAN, AS REQUIRED PURSUANT TO SECTION6
12-115-115 (1) OR 12-155-124 (1); AND7
(b) BE INSTALLED IN COMPLIANCE WITH THE RULES OF THE STATE8
ELECTRICAL BOARD OR THE STATE PLUMBING BOARD AND IN ACCORDANCE9
WITH THE ELECTRICAL AND PLUMBING CODES ADOPTED PURSUANT TO10
THOSE RULES.11
(3) FOR ANY THERMAL ENERGY NETWORK OR THERMAL ENERGY12
SYSTEM THAT A UTILITY OWNS, THE UTILITY SHALL USE UTILITY13
EMPLOYEES OR QUALIFIED CONTRACTORS TO PERFORM ANY14
CONSTRUCTION TRADE WORK DEEMED NECESSARY TO COMPLETE THE15
PROJECT. A QUALIFIED CONTRACTOR IS A CONTRACTOR WITH EMPLOYEES16
THAT HAVE ACCESS TO AN APPRENTICESHIP PROGRAM AS DEFINED IN17
SECTION 8-83-308 (3)(a). ALL MECHANICAL, ELECTRICAL, AND PLUMBING18
CONTRACTORS AND SUBCONTRACTORS MUST MEET THE APPRENTICESHIP19
UTILIZATION REQUIREMENTS OF SECTION 24-92-115; EXCEPT THAT THE20
APPRENTICESHIP UTILIZATION REQUIREMENTS DO NOT APPLY TO :21
(a) THE DESIGN, PLANNING, OR ENGINEERING OF INFRASTRUCTURE;22
(b) MANAGEMENT FUNCTIONS FOR THE OPERATION OF23
INFRASTRUCTURE; OR24
(c) ANY WORK INCLUDED IN A WARRANTY .25
(4) AS USED IN THIS SECTION, UNLESS THE CONTEXT OTHERWISE26
REQUIRES:27
1252
-7- (a) "AGENCY OF GOVERNMENT " HAS THE MEANING SET FORTH IN1
SECTION 24-92-201 (1).2
(b) "LICENSED ELECTRICIAN" MEANS AN ELECTRICIAN LICENSED3
PURSUANT TO SECTION 12-115-110.4
(c) "LICENSED PLUMBER" MEANS A PLUMBER LICENSED PURSUANT5
TO SECTION 12-155-108.6
(d) "PUBLIC PROJECT" HAS THE MEANING SET FORTH IN SECTION7
24-92-201
(5).8 (e) "STATE INSTITUTION OF HIGHER EDUCATION " HAS THE9
MEANING SET FORTH IN SECTION 23-18-102 (10).10
(f) "THERMAL ENERGY NETWORK " HAS THE MEANING SET FORTH11
IN SECTION 40-3.2-108 (2)(s).12
(g) "THERMAL ENERGY SYSTEM " HAS THE MEANING SET FORTH IN13
SECTION 40-3.2-108 (2)(t).14
SECTION 4. In Colorado Revised Statutes, 40-3.2-108, amend15
(2)(c)(V); and add (2)(c)(V.5), (2)(h.5), (2)(r), (2)(s), (2)(t), and16
(4)(c)(XIV.5) as follows:17
40-3.2-108. Clean heat targets - legislative declaration -18
definitions - plans - rules - reports. (2) Definitions. As used in this19
section, unless the context otherwise requires:20
(c) "Clean heat resource" means any one or a combination of:21
(V) Pyrolysis of tires if the pyrolysis meets a recovered methane22
protocol; and23
(V.5) T
HERMAL ENERGY; AND24
(h.5) "G
EOTHERMAL FLUID" HAS THE MEANING SET FORTH IN25
SECTION 37-90.5-103 (2).26
(r) (I) "T
HERMAL ENERGY" MEANS PIPED, NONCOMBUSTIBLE27
1252
-8- FLUIDS USED FOR ADDING OR REMOVING HEAT FROM BUILDINGS FOR THE1
PURPOSE OF EFFICIENT BUILDING TEMPERATURE CONTROL AND DOMESTIC2
HOT WATER, INCLUDING SPACE HEATING AND COOLING AND3
REFRIGERATION.4
(II) "T
HERMAL ENERGY" INCLUDES METHODS OF EXCHANGING THE5
PIPED, NONCOMBUSTIBLE FLUIDS THROUGH THE GROUND , WASTEWATER6
TREATMENT FACILITIES, OR OTHER SOURCES THAT ACHIEVE DESIRED FLUID7 TEMPERATURES; EXCEPT THAT ANY SOURCE OF THERMAL ENERGY FOR8
THIS PURPOSE MUST:9
(A) NOT CAUSE INCREMENTAL GREENHOUSE GAS EMISSIONS OR10
RELY ON INCREASED, LONG-TERM COMBUSTION OF FOSSIL FUELS; AND11
(B) BE EVALUATED BY THE COMMISSION TO PROTECT AGAINST12
INCREASED EMISSIONS OF HARMFUL CO-POLLUTANTS, NEGATIVE IMPACTS13
TO COMMUNITIES INCLUDING TO DISPROPORTIONATELY IMPACTED14
COMMUNITIES, AS DEFINED IN SECTION 24-4-109 (2)(b)(II), AND THE RISK15
OF STRANDED ASSETS, IF THE THERMAL ENERGY IS FROM ANY INDUSTRIAL16
SOURCE INCLUDING A SYSTEM FOR WHICH THE PRIMARY PURPOSE IS TO17
GENERATE ELECTRICITY , INCLUDING ANY PROCESS INVOLVING18
ENGINE-DRIVEN GENERATION.19
(s) "T
HERMAL ENERGY NETWORK ":20
(I) M
EANS ALL REAL ESTATE, FIXTURES, AND PERSONAL PROPERTY21
THAT ARE OPERATED, OWNED, USED, OR INTENDED TO BE USED FOR, IN22
CONNECTION WITH, OR TO FACILITATE A DISTRIBUTION INFRASTRUCTURE23
PROJECT THAT SUPPLIES THERMAL ENERGY TO TWO OR MORE BUILDINGS24
THAT ARE NOT A CAMPUS, AS DEFINED IN SECTION 40-4-121 (1)(a), AND25
THAT ASSISTS IN REDUCING GREENHOUSE GAS EMISSIONS IN THE STATE ;26
(II) C
ONSISTS OF PIPE LOOPS BETWEEN MULTIPLE BUILDINGS AND27
1252
-9- ENERGY SOURCES CARRYING PIPED , NONCOMBUSTIBLE FLUIDS AT THE1
DESIRED THERMAL TEMPERATURE ;2
(III) I
NCLUDES A NETWORK THAT CAN BE USED FOR HEATING ,3
COOLING, AND OTHER BUILDING SERVICES; AND4
(IV) M
AY ALSO BE KNOWN AS A GEOTHERMAL EXCHANGE5
DISTRICT, NETWORKED GEOTHERMAL SYSTEM , GEOEXCHANGE SYSTEM ,6
GEOGRID SYSTEM, COMMUNITY GEOTHERMAL HEATING AND COOLING7
DISTRICT, OR A GEOTHERMAL HEATING DISTRICT .8
(t) "T
HERMAL ENERGY SYSTEM" INCLUDES A GEOTHERMAL SYSTEM9
OR OTHER METHOD OF EXCHANGING THE PIPED , NONCOMBUSTIBLE FLUIDS10
THROUGH THE GROUND, WASTEWATER TREATMENT FACILITIES , OR OTHER11
SOURCES
OF THERMAL ENERGY THAT ACHIEVE DESIRED FLUID12
TEMPERATURES.13
(4) Submission of clean heat plans. (c) A clean heat plan filed14
pursuant to this subsection (4) must:15
(XIV.5) D
EMONSTRATE THAT, WITH RESPECT TO ANY THERMAL16
ENERGY NETWORK THAT WILL BE USED AS A CLEAN HEAT RESOURCE , ANY17
GEOTHERMAL FLUID ASSOCIATED WITH THE THERMAL ENERGY SYSTEM OR18
THERMAL ENERGY NETWORK IS USED IN COMPLIANCE WITH THE19
PERMITTING REQUIREMENTS FOR PRODUCTION OF GEOTHERMAL FLUID SET20
FORTH IN ARTICLE 90.5 OF TITLE 37; AND21
SECTION 5. In Colorado Revised Statutes, add 40-4-121 as22
follows:23
40-4-121. Thermal energy network projects - pilot program24
for large gas utilities - application - commission proceeding -25
reporting - exemption from regulation for local government- or26
campus-owned thermal energy networks - definitions. (1) A
S USED IN27
1252
-10- THIS SECTION, UNLESS THE CONTEXT OTHERWISE REQUIRES :1
(a) (I) "C
AMPUS" MEANS A COLLECTION OF TWO OR MORE2
BUILDINGS THAT ARE OWNED AND OPERATED BY THE SAME
PERSON, THAT3
HAVE A SHARED PURPOSE AND FUNCTION AS A SINGLE PROPERTY, THAT DO4
NOT LEASE SPACE TO TENANTS, AND THAT DO NOT PROVIDE ENERGY OR5
HEAT SERVICES FOR A FEE.6
(II) "C
AMPUS" INCLUDES TWO OR MORE OF THE BUILDINGS THAT7
COMPRISE THE CAPITOL COMPLEX , AS DEFINED IN SECTION 24-82-1018
(3)(f).9
(b) "D
ISPROPORTIONATELY IMPACTED COMMUNITY " HAS THE10
MEANING SET FORTH IN SECTION 24-4-109 (2)(b)(II).11
(c) "G
AS UTILITY" MEANS A GAS UTILITY IN THE STATE THAT THE12
COMMISSION REGULATES WITH RESPECT TO RATES AND CHARGES .13
(d) "L
ARGE GAS UTILITY" MEANS A GAS UTILITY THAT SERVES14
MORE THAN FIVE HUNDRED THOUSAND CUSTOMERS .15
(e) "L
OCAL GOVERNMENT" MEANS A STATUTORY OR HOME -RULE16
CITY, TOWN, COUNTY, OR CITY AND COUNTY.17
(f) "T
HERMAL ENERGY" HAS THE MEANING SET FORTH IN SECTION18
40-3.2-108 (2)(r).19
(g) "T
HERMAL ENERGY NETWORK " HAS THE MEANING SET FORTH20
IN SECTION 40-3.2-108 (2)(s).21
(h) "THERMAL ENERGY SYSTEM" HAS THE MEANING SET FORTH IN22
SECTION 40-3.2-108 (2)(t).23
(2) (a) E
XCEPT AS PROVIDED IN SUBSECTION (3) OF THIS SECTION,24
A GAS UTILITY THAT SEEKS TO OFFER THERMAL ENERGY NETWORK25
SERVICE TO ITS CUSTOMERS MUST PROPOSE DEVELOPING A THERMAL26
ENERGY NETWORK BY A SEPARATE APPLICATION TO THE COMMISSION27
1252
-11- THAT IS NOT INCLUDED IN THE GAS UTILITY 'S APPLICATION TO THE1
COMMISSION FOR APPROVAL OF A CLEAN HEAT PLAN PURSUANT TO2
SECTION 40-3.2-108 OR A GAS DEMAND-SIDE MANAGEMENT PROGRAM3
PLAN PURSUANT TO SECTION 40-3.2-103 (3) OR AS PART OF A DSM4
STRATEGIC ISSUES APPLICATION PURSUANT TO SECTION 40-3.2-103 (1).5
(b) I
N CONSIDERING WHETHER TO APPROVE A GAS UTILITY 'S6
APPLICATION TO OFFER THERMAL ENERGY NETWORK SERVICE , THE7
COMMISSION SHALL CONSIDER THE LONG -TERM EFFECTS THAT THE8
PROPOSED THERMAL ENERGY NETWORK WOULD HAVE ON THE STATE 'S9
UTILITY WORKFORCE.10
(3) (a) O
N OR BEFORE SEPTEMBER 1, 2024, A LARGE GAS UTILITY11
SHALL SUBMIT TO THE COMMISSION FOR REVIEW AND APPROVAL AT LEAST12
ONE PILOT PROGRAM, CONSISTING OF ONE OR MORE PILOT PROJECTS , TO13
PROVIDE THERMAL ENERGY SERVICE IN ITS SERVICE AREA .14
(b) A
LARGE GAS UTILITY MAY PROPOSE MORE THAN ONE PILOT15
THERMAL ENERGY NETWORK PROGRAM PURSUANT TO THIS SUBSECTION (3)16
BY FILING SEPARATE APPLICATIONS FOR REVIEW AND APPROVAL OF17
ADDITIONAL PILOT PROGRAMS WITH THE COMMISSION ON OR BEFORE18
S
EPTEMBER 1, 2026.19
(c) I
N DEVELOPING A PILOT PROGRAM PROPOSAL , A LARGE GAS20
UTILITY SHALL PROPOSE AS PART OF THE PROPOSED PILOT PROGRAM AT21
LEAST ONE PILOT PROJECT THAT SERVES RESIDENTIAL CUSTOMERS22
LOCATED IN A:23
(I) D
ISPROPORTIONATELY IMPACTED COMMUNITY ;24
(II) M
OUNTAIN COMMUNITY SERVED BY THE LARGE GAS UTILITY ;25
OR26
(III) U
TILITY SERVICE AREA THAT THE COMMISSION HAS27
1252
-12- DETERMINED IS CAPACITY CONSTRAINED OR THAT IS TARGETED FOR1
ELECTRIFICATION IN A UTILITY CLEAN HEAT PLAN OR BENEFICIAL2
ELECTRIFICATION PLAN.3
(d) A
LARGE GAS UTILITY'S PILOT THERMAL ENERGY NETWORK4
PROGRAM PROPOSAL MUST :5
(I) I
NCLUDE SPECIFIC CUSTOMER PROTECTION PLANS THAT6
PROMOTE STABLE UTILITY RATES;7
(II) B
E MADE PUBLICLY AVAILABLE ON THE COMMISSION 'S8
WEBSITE; AND9
(III) I
F APPROVED, BE IMPLEMENTED IN COMPLIANCE WITH THE10
LABOR STANDARDS SET FORTH IN SECTION 40-3.2-105.7.11
(e) I
N CONSIDERING WHETHER TO APPROVE A LARGE GAS UTILITY 'S12
APPLICATION PROPOSING A PILOT THERMAL ENERGY NETWORK PROGRAM ,13
THE COMMISSION SHALL CONSIDER THE LONG -TERM EFFECTS THAT THE14
PROPOSED PILOT THERMAL ENERGY NETWORK PROGRAM WOULD HAVE ON15
THE STATE'S UTILITY WORKFORCE.16
(f) A
LARGE GAS UTILITY MAY PROPOSE A PILOT THERMAL ENERGY17
NETWORK PROGRAM AS PART OF THE LARGE GAS UTILITY 'S APPLICATION18
FOR APPROVAL OF A CLEAN HEAT PLAN PURSUANT TO SECTION 40-3.2-10819
OR A GAS DSM PROGRAM PLAN PURSUANT TO SECTION 40-3.2-103 (3) OR20
AS PART OF A STRATEGIC ISSUES APPLICATION ; EXCEPT THAT A PILOT21
THERMAL ENERGY NETWORK PROGRAM APPLIED FOR AS PART OF A CLEAN22
HEAT PLAN DOES NOT COUNT TOWARD THE CLEAN HEAT PLAN COST CAPS23
SET FORTH IN SECTION 40-3.2-108 (6)(a)(I).24
(g) I
N PROPOSING A PILOT THERMAL ENERGY NETWORK PROGRAM25
PURSUANT TO THIS SUBSECTION (3), A LARGE GAS UTILITY SHALL PRESENT26
TO THE COMMISSION OPTIONS FOR HOW THE LARGE GAS UTILITY MAY FUND27
1252
-13- THE PILOT PROGRAM, INCLUDING OPTIONS THAT INVOLVE THE USE OF ANY1
FEDERAL OR PRIVATE SOURCES OF FUNDING OR RATE RECOVERY FROM2
NONRESIDENTIAL CUSTOMERS TO MANAGE IMPACTS UPON RESIDENTIAL3
CUSTOMERS. A PILOT THERMAL ENERGY NETWORK PROGRAM APPLICATION4
MUST INCLUDE A CURRENT OR FORWARD -LOOKING RATE STRUCTURE TO5
PROMOTE STABLE CUSTOMER BILLING .6
(4) A
LARGE GAS UTILITY THAT DEVELOPS A PILOT THERMAL7
ENERGY NETWORK PROGRAM SHALL REPORT TO THE COMMISSION IN THE8
FORM AND MANNER REQUIRED BY THE COMMISSION INFORMATION AND9
DATA REGARDING THE PILOT PROGRAM TO HELP FURTHER THE10
DEVELOPMENT OF FUTURE THERMAL ENERGY NETWORKS . THE LARGE GAS11
UTILITY'S REPORT MUST INCLUDE:12
(a) T
HE POTENTIAL FOR IMPLEMENTATION OF THERMAL ENERGY13
NETWORKS TO PROVIDE CONSUMER BILL STABILIZATION AND THE14
METHODS BY WHICH SUCH STABILIZATION MAY BE ACHIEVED ;15
(b) T
HE POTENTIAL FOR IMPLEMENTATION OF THERMAL ENERGY16
NETWORKS TO REDUCE CONSUMER BILL COSTS ;17
(c) T
HE POTENTIAL TO REUSE EXISTING GAS INFRASTRUCTURE FOR ,18
OR TO TIME END -OF-LIFE GAS INFRASTRUCTURE RETIREMENT OR19
REPLACEMENT WITH, IMPLEMENTATION OF THERMAL ENERGY NETWORKS ;20
(d) T
HE POTENTIAL FOR IMPLEMENTATION OF THERMAL ENERGY21
NETWORKS TO ASSIST THE LARGE GAS UTILITY IN AVOIDING STR ANDED GAS22
ASSETS;23
(e) A
N ESTIMATE OF AVOIDED EMISSIONS FROM IMPLEMENTATION24
OF THERMAL ENERGY NETWORKS ; AND25
(f) P
ROGRAMS, INCENTIVES, OR OTHER MECHANISMS THAT THE26
LARGE GAS UTILITY MAY EMPLOY TO MAKE WIDESPREAD THERMAL27
1252
-14- ENERGY NETWORK IMPLEMENTATION A VIABLE OPTION .1
(5) (a) O
N OR BEFORE JANUARY 1, 2025, THE COMMISSION SHALL2
INITIATE A PROCEEDING TO DETERMINE WHETHER COMMISSION3
RULE-MAKING OR ADDITIONAL LEGISLATIVE CHANGES ARE NEEDED TO4
FACILITATE THE DEVELOPMENT OF THERMAL ENERGY IN THE STATE .5
(b) (I) A
S PART OF THE PROCEEDING HELD PURSUANT TO THIS6
SUBSECTION (5), THE COMMISSION SHALL CONSIDER :7
(A) T
HE APPROPRIATE UTILITY OWNERSHIP MODELS
FOR8
DEVELOPMENT, ACQUISITION, CUSTOMER SERVICE, AND COST RECOVERY9
FOR THERMAL ENERGY NETWORKS ; AND10
(B) T
HE APPROPRIATE UTILITY RATE STRUCTURES FOR
AND11
CUSTOMER TYPES OR CLASSES SERVED BY THERMAL ENERGY NETWORKS .12
(II) T
HE COMMISSION MAY ALSO CONSIDER DURING THE13
PROCEEDING WHETHER RULES ARE NECESSARY TO :14 (A) CREATE REQUIREMENTS FOR GAS-UTILITY-OWNED THERMAL15
ENERGY NETWORKS CONCERNING A LARGE GAS UTILITY 'S ABILITY TO16
PARTNER WITH QUALIFIED THIRD PARTIES THROUGH JOINT VENTURES,17
ASSET DEVELOPMENT AND TRANSFERS, OR SIMILAR STRUCTURES AND18
FACILITATE THE DEVELOPMENT OF THERMAL ENERGY NETWORKS ;19
(B) E
NSURE THAT ANY THERMAL ENERGY NETWORK20
INCORPORATED INTO A LARGE GAS UTILITY'S SYSTEM PROVIDES RELIABLE21
AND RESILIENT SERVICE;22
(C) P
ROMOTE TRAINING AND TRANSITION OF UTILITY WORKERS23
FOR THERMAL ENERGY JOBS;24
(D) A
DJUST A LARGE GAS UTILITY'S RATE RECOVERY MECHANISMS25
TO FURTHER SUPPORT THE DEVELOPMENT OF THERMAL ENERGY26
NETWORKS AS PART OF MEETING THE STATE 'S OVERALL ENERGY POLICY27
1252
-15- OBJECTIVES; AND1
(E) D
ETERMINE APPROPRIATE METHODS OF COST RECOVERY FOR2
THERMAL ENERGY NETWORKS , INCLUDING CONSIDERATION OF THE3
STABILITY OF UTILITY CUSTOMERS' BILLS.4
(6) A
LOCAL GOVERNMENT OR CAMPUS THAT DEVELOPS AND5
OPERATES A THERMAL ENERGY
SYSTEM THAT PROVIDES THERMAL ENERGY6
SERVICE TO BUILDINGS THAT THE LOCAL GOVERNMENT OR CAMPUS OWNS7
AND MANAGES IS NOT CONSIDERED A PUBLIC UTILITY AND IS NOT SUBJECT8
TO REGULATION BY THE COMMISSION .9
SECTION 6. In Colorado Revised Statutes, repeal article 40 of10
title 40.11
SECTION 7. In Colorado Revised Statutes, 30-20-603, amend12
(1)(a) as follows:13
30-20-603. Improvements and funding authorized - how14
instituted - conditions - definitions. (1) (a) (I) A district may be formed15
in accordance with the requirements of this part 6 for the purpose of16
constructing, installing, acquiring, or funding, in whole or in part, any17
public improvement, so long as the county that forms the district is18
authorized to provide such improvement or provide for such funding19
under the county's home rule charter, if any, or the laws of this state.20
Public improvements or the funding thereof shall OF PUBLIC21
IMPROVEMENTS MUST not include any facility identified in section22
30-20-101 (8) or (9). No such A district shall NOT provide the same23
improvement as an existing special district within the territory of such24
THE existing special district unless the existing special district consents.25
(II) The improvements authorized by this part 6 may consist,26
without limitation, of constructing, grading, paving, pouring, curbing,27
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-16- guttering, lining, or otherwise improving the whole or any part of any1
street or providing street lighting, drainage facilities, or service2
improvements in the unincorporated area of a county or wholly or partly3
within the boundaries of any municipality within the county if such4
municipality consents by ordinance to such THE improvements. If5
improvements within a municipality are so included in a county6
improvement district by municipal consent, the county shall have full7
authority to MAY construct or acquire such improvements, to assess8
property within such THE municipality benefited by such THE9
improvements, and to enforce and collect such assessments, in the manner10
provided in this part 6. The improvements authorized by this part 6 may11
include, without limitation, the construction of sidewalks adjacent to any12
such streets or maintenance roads adjacent to any such drainage facilities.13
(III) Prior to the establishment of any improvement district for the14
purpose of providing street lighting, arrangements, by contract or15
otherwise, must be established under which the owners of property16
included within such THE district shall be ARE responsible for the17
maintenance and operation of such street lighting improvement. The costs18
of maintenance and operation of such THE street lighting improvements19
shall not be paid from the county general fund.20
(IV) Drainage facilities shall not be provided in any area which21
THAT is within an existing drainage district organized or created pursuant22
to law without the approval of such THE district.23
(V) The term AS USED IN THIS SUBSECTION (1)(a), "service" as24
used in this paragraph (a) includes the services provided by a public25
utility as defined in section 40-1-103, C.R.S., as well as advanced service26
as defined in section 29-27-102 (1), C.R.S., cable television service as27
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-17- defined in section 29-27-102 (2), C.R.S., telecommunications service as1
defined in section 40-15-102 (29), C.R.S., geothermal heat suppliers, as2
defined in section 40-40-103, C.R.S., and information service as defined3
in 47 U.S.C. sec. 153 (20) (24), or any successor section.4
SECTION 8. Act subject to petition - effective date. This act5
takes effect at 12:01 a.m. on the day following the expiration of the6
ninety-day period after final adjournment of the general assembly; except7
that, if a referendum petition is filed pursuant to section 1 (3) of article V8
of the state constitution against this act or an item, section, or part of this9
act within such period, then the act, item, section, or part will not take10
effect unless approved by the people at the general election to be held in11
November 2024 and, in such case, will take effect on the date of the12
official declaration of the vote thereon by the governor.13
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