STORAGE NAME: h1239a.EIS
DATE: 3/25/2025
1
FLORIDA HOUSE OF REPRESENTATIVES
BILL ANALYSIS
This bill analysis was prepared by nonpartisan committee staff and does not constitute an official statement of legislative intent.
BILL #: HB 1239
TITLE: Energy Infrastructure Investment
SPONSOR(S): Kincart Jonsson
COMPANION BILL: SB 1574 (DiCeglie)
LINKED BILLS: None
RELATED BILLS: None
Committee References
Economic Infrastructure
15 Y, 1 N
Commerce
SUMMARY
Effect of the Bill:
The bill authorizes the Public Service Commission to create an experimental cost recovery mechanism to facilitate
investment in certain gas infrastructure projects that collect, prepare, clean, process, transport, or inject gas as a
transportation fuel or for pipeline distribution. For purposes of the bill, “gas “ is defined as anaerobically generated
biogas, landfill gas, or wastewater treatment gas refined to a methane content of 90 percent or greater – commonly
referred to as renewable natural gas – which may be used as a transportation fuel or for pipeline distribution.
Fiscal or Economic Impact:
None
JUMP TO SUMMARY ANALYSIS RELEVANT INFORMATION BILL HISTORY
ANALYSIS
EFFECT OF THE BILL:
The bill provides that the Public Service Commission (PSC), under its rate setting authority, may establish an
experimental mechanism to facilitate energy infrastructure investments in gas consistent with the structure set
forth in s. 366.96(7) and (8), F.S.,
1 and the intent of s. 366.91, F.S.
2 The bill provides that these investments may
include only projects that collect, prepare, clean, process, transport, or inject gas as a transportation fuel or for
pipeline distribution.
For purposes of this experimental mechanism, the bill defines “gas “ is defined as anaerobically generated biogas,
landfill gas, or wastewater treatment gas refined to a methane content of 90 percent or greater – commonly
referred to as renewable natural gas
3 – which may be used as a transportation fuel or for pipeline distribution.
The bill requires the PSC to adopt rules to implement and administer the provisions of the bill and requires the PSC
to propose such rules for adoption no later than January 1, 2026. (Section 1.)
The bill has an effective date of July 1, 2025. (Section 2.)
1
These statutory provisions establish the mechanism by which an investor-owned electric utility may recover, through a
customer charge separate from the utility’s base rates, its prudently incurred costs associated with PSC-approved storm
protection plans. This mechanism requires an annual proceeding to determine prudently incurred cots, but the bill provides
the PSC with discretion to determine whether or not to conduct the experimental mechanism authorized by the bill in an
annual proceeding.
2
This provision provides this legislative finding: “[I]t is in the public interest to promote the development of renewable energy
resources in this state. Renewable energy resources have the potential to help diversify fuel types to meet Florida’s growing
dependency on natural gas for electric production, minimize the volatility of fuel costs, encourage investment within the state,
improve environmental conditions, and make Florida a leader in new and innovative technologies.”
3
See s. 366.91(f), F.S. JUMP TO SUMMARY ANALYSIS RELEVANT INFORMATION BILL HISTORY
2
RULEMAKING:
The bill requires the PSC to adopt rules to implement and administer the provisions of the bill and requires the PSC
to propose such rules for adoption no later than January 1, 2026.
Lawmaking is a legislative power; however, the Legislature may delegate a portion of such power to executive
branch agencies to create rules that have the force of law. To exercise this delegated power, an agency must
have a grant of rulemaking authority and a law to implement.
RELEVANT INFORMATION
SUBJECT OVERVIEW:
Rate Setting for Public Utilities
The Public Service Commission (PSC) has broad jurisdiction over the rates and service of public (investor-owned)
electric and natural gas utilities in Florida.
4 Under this broad grant of authority, and through more specific grants
of authority in chapter 366, F.S., the PSC sets rates for such utilities through various mechanisms, each of which is
established in a separate administrative proceeding, typically a formal evidentiary hearing.
For natural gas utilities, the largest portions of these rates are comprised of base rates, which cover most of a
utility’s operations and maintenance expenses, recovery of its capital investment through depreciation expense,
and a return on that investment, plus charges that reflect the utility’s cost to procure natural gas. Base rates are
adjusted as needed through general rate cases, while “purchased gas” charges are adjusted annually through a
“cost recovery clause” proceeding. A much smaller portion of natural gas utility rates reflects the costs of energy
conservation and efficiency programs.
5
Similarly, the largest portions of electric utility rates are comprised of base rates plus annually adjusted “fuel and
purchased power” charges that reflect the utility’s costs to procure power plant fuel and to purchase wholesale
electricity. Other portions of electric utility rates reflects the costs to comply with government-mandated
environmental standards,
6 energy efficiency and conservation program costs,
7 storm protection plan costs,
8 and, on
occasion, storm recovery costs. Each of these charges is set in an annual proceeding.
The PSC is also authorized to establish certain experimental rates.
9
Renewable Natural Gas
Florida law provides that it is in the public interest to promote the development of renewable energy resources to
help diversify fuel types for electric production, minimize the volatility of fuel costs, encourage investment within
the state, improve environmental conditions, and make Florida a leader in new and innovative technologies.
10
Renewable natural gas (RNG) is the gaseous product of the decomposition of organic matter, processed into a
pipeline-quality gas that is fully interchangeable with conventional natural gas. Primary sources of RNG include
landfills, livestock operations, and wastewater treatment facilities.
11
In 2021, the Legislature added the term “renewable natural gas” to Florida law and defined it as “anaerobically
generated biogas, landfill gas, or wastewater treatment gas refined to a methane content of 90 percent or greater
4
See, e.g., ss. 366.01, 366.04(1), 366.041, 366.05(1), and 366.06, F.S.
5
S. 366.82, F.S.
6
S. 366.8255, F.S.
7
S. 366.82, F.S.
8
S. 366.96, F.S.
9
S. 366.075, F.S.
10
S. 366.91(1), F.S.
11
Office of Energy Efficiency & Renewable Energy, Alternative Fuels Data Center – Renewable Natural Gas Production, U.S.
Department of Energy, https://afdc.energy.gov/fuels/natural_gas_renewable.html (last visited Mar. 21, 2025). JUMP TO SUMMARY ANALYSIS RELEVANT INFORMATION BILL HISTORY
3
which may be used as a transportation fuel or for electric generation or is of a quality capable of being injected into
a natural gas pipeline.” The legislation authorized the PSC to approve cost recovery for the purchase of RNG by
natural gas public utilities, even if pricing exceeds the current market price of natural gas, if the PSC deems the
purchase to be reasonable and prudent.
12
Renewable Fuel Standard Program
Created as part of the Energy Policy Act of 2005, the Renewable Fuel Standard (RFS) program is a national
program that requires a certain volume of renewable fuel to be used to replace or reduce the quantity of fossil fuel
in transportation fuel, home heating oil, or jet fuel.
13 The program is administered by the U.S. Environmental
Protection Agency (EPA). Refiners or importers of gasoline or diesel fuel are obligated under the RFS program to
obtain and retire enough credits representing renewable fuel sufficient to meet annual volume targets established
by formula.
14 These credits can be generated by renewable fuel producers, including renewable natural gas
producers, and may be purchased by obligated refiners and importers to achieve compliance with the RFS
program.
15
Under the RFS program, a producer of renewable natural gas may generate credits reflecting the volume of such
gas used as a transportation fuel and sell those credits to refiners and importers of gasoline or diesel fuel obligated
to comply with the program.
RECENT LEGISLATION:
YEAR BILL # HOUSE SPONSOR(S) SENATE SPONSOR OTHER INFORMATION
2024
2023
CS/SB 480
CS/CS/SB 1162
Yeager
Yeager
DiCeglie
DiCeglie
Passed the Senate, but died in
the House.
Passed the Senate, but died in
the House.
BILL HISTORY
COMMITTEE REFERENCE ACTION DATE
STAFF
DIRECTOR/
POLICY CHIEF
ANALYSIS
PREPARED BY
Economic Infrastructure
Subcommittee
15 Y, 1 N 3/25/2025 Keating Bauldree
Commerce Committee
12
Ch. 2021-178, Laws of Fla., codified at s. 366.91(2)(f) and (9), F.S.
13
See U.S. Environmental Protection Agency, Overview of the Renewable Fuel Standard Program,
https://www.epa.gov/renewable-fuel-standard-program/overview-renewable-fuel-standard-program (last visited Mar. 21,
2025).
14
Id.
15
Id.