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Massachusetts Senate Bill S2096

Massachusetts 2023-2024 Regular Session

Massachusetts Senate Bill S2096 Compare Versions

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22 SENATE DOCKET, NO. 371 FILED ON: 1/13/2023
33 SENATE . . . . . . . . . . . . . . No. 2096
44 The Commonwealth of Massachusetts
55 _________________
66 PRESENTED BY:
77 Cynthia Stone Creem
88 _________________
99 To the Honorable Senate and House of Representatives of the Commonwealth of Massachusetts in General
1010 Court assembled:
1111 The undersigned legislators and/or citizens respectfully petition for the adoption of the accompanying bill:
1212 An Act relative to Massachusetts' carbon dioxide removal leadership.
1313 _______________
1414 PETITION OF:
1515 NAME:DISTRICT/ADDRESS :Cynthia Stone CreemNorfolk and MiddlesexJames B. EldridgeMiddlesex and Worcester2/15/2023 1 of 11
1616 SENATE DOCKET, NO. 371 FILED ON: 1/13/2023
1717 SENATE . . . . . . . . . . . . . . No. 2096
1818 By Ms. Creem, a petition (accompanied by bill, Senate, No. 2096) of Cynthia Stone Creem and
1919 James B. Eldridge for legislation relative to Massachusetts' carbon dioxide removal leadership.
2020 Telecommunications, Utilities and Energy.
2121 The Commonwealth of Massachusetts
2222 _______________
2323 In the One Hundred and Ninety-Third General Court
2424 (2023-2024)
2525 _______________
2626 An Act relative to Massachusetts' carbon dioxide removal leadership.
2727 Be it enacted by the Senate and House of Representatives in General Court assembled, and by the authority
2828 of the same, as follows:
2929 1 SECTION 1. Chapter 23J of the General Laws, as amended by chapter 179 of the acts of
3030 22022, is hereby amended by inserting the following section:-
3131 3 Section 16. (a) For the purposes of this section, the following terms shall have the
3232 4following meanings unless the context clearly requires otherwise:
3333 5 “Advance market commitment” means the purchase in advance of carbon dioxide
3434 6removal.
3535 7 "Annual removal target" means the minimum total volume of carbon dioxide removal,
3636 8expressed in metric tons of carbon dioxide equivalent, for which the Authority will made
3737 9advance market commitment and solicit bids in a given year, such amount to be increased by the
3838 10portion of the annual removal target not met in the prior year. 2 of 11
3939 11 “Center” means the Massachusetts clean energy center established in chapter 23J of the
4040 12General Laws.
4141 13 "Qualifying bid" means a bid fulfilling the requirements of subsection (d) of this section.
4242 14 "Bid price" means the total price the bidder is willing to be paid in a given bid for
4343 15providing carbon dioxide removal.
4444 16 "Bidder" means a person, entity or entities qualified to submit a bid pursuant to the
4545 17requirements set forth in subsection (d) of this section.
4646 18 "Carbon dioxide equivalent'', the amount of carbon dioxide by weight that would produce
4747 19the same global warming impact as a given weight of another greenhouse gas, based on the best
4848 20available science, including from the Intergovernmental Panel on Climate Change.
4949 21 "Carbon dioxide removal" means removing greenhouse gas, measured in carbon dioxide
5050 22equivalent emissions, from the atmosphere, and durably storing it in geological, terrestrial, or
5151 23ocean reservoirs, or in long-lived products for a minimum period of 100 years.
5252 24 "Carbon dioxide removal process" means the physical process by which greenhouse
5353 25gases are removed from the atmosphere and durably sequestered or stored.
5454 26 "Carbon dioxide removal project" means a specific project that delivers the carbon
5555 27dioxide removal described in a given bid.
5656 28 “Director of environmental justice” means the director of environmental justice in the
5757 29executive office of energy and environmental affairs. 3 of 11
5858 30 "Disadvantaged communities" means communities identified by the center that bear
5959 31disproportionate burdens from environmental pollution and from the impacts of climate change,
6060 32and which are comprised of high concentrations of low- and moderate-income households.
6161 33 "Durability" or "durable" means the secure sequestration of carbon dioxide equivalent in
6262 34the geosphere, in the ocean, in long-lived products, or otherwise, measured as a unit of time.
6363 35 “Environmental justice and community engagement report” means a form developed by
6464 36the director of environmental justice and completed by the bidder that documents evidence that
6565 37residents of disadvantaged communities have been consulted and afforded the opportunity to
6666 38provide comment and suggestions concerning the proposed project. All reports submitted by
6767 39bidders must be reviewed and approved by the director of environmental justice as a condition of
6868 40selection. The report shall include a description and quantification, where possible, of the
6969 41proposed carbon dioxide removal project’s effects on: (i) equity and environmental justice,
7070 42including health and quality of life; (ii) the local ecosystem, including soil health, biodiversity,
7171 43and water and air quality; and (iii) job creation and economic development.
7272 44 "Greenhouse gas'', any chemical or physical substance that is emitted into the air and that
7373 45the department of environmental protection may reasonably anticipate will cause or contribute to
7474 46climate change including, but not limited to, carbon dioxide, methane, nitrous oxide,
7575 47hydrofluorocarbons, perfluorocarbons and sulfur hexafluorid
7676 48 "Life-cycle analysis" means a complete, end-to-end analysis of the greenhouse gas
7777 49emissions resulting from a carbon dioxide removal process, including, but not limited to,
7878 50manufacturing, transportation, utilization, sequestration and other processes occurring prior to, 4 of 11
7979 51during, or after, the carbon dioxide removal process which are required to achieve carbon
8080 52dioxide removal.
8181 53 "Measurement, reporting and verification" means the verified measurement and reporting
8282 54of carbon dioxide removal using an objective, peer-reviewed and scientifically supported
8383 55accounting methodology and taking into account regionally appropriate sampling and data
8484 56collection methods to quantify emissions and removals associated with the carbon dioxide
8585 57removal process and durability of removal instead of solely model-based or statistical methods.
8686 58 "Reverse auction" means a bidding process in which qualified bidders submit bids to
8787 59remove and durably store a specified quantity of carbon dioxide equivalent emissions in
8888 60exchange for payment by the state.
8989 61 "Social cost" means a measure, in dollars, of the long-term damage done by a ton of
9090 62carbon dioxide equivalent emissions in a given year.
9191 63 "Ton" means a metric ton of one thousand kilograms.
9292 64 "Total annual bid" means the total volume of carbon dioxide removal for which
9393 65qualifying bids were submitted in a given year.
9494 66 (b) Prior to the initiation of the reverse auction for the commonwealth’s advance market
9595 67commitment for carbon dioxide removal services, the center shall publish a survey of carbon
9696 68dioxide removal opportunities within the commonwealth. Such survey shall include, but shall not
9797 69be limited to: (i) data gathered by the center pursuant to carbon dioxide removal verification as
9898 70required by subsection (f) of this section; (ii) a review of carbon dioxide removal processes in the
9999 71commonwealth with 100,000 metric tons or greater scale potential this decade and 100-year or 5 of 11
100100 72greater durability, with a description for each of water and land-use requirements, life-cycle
101101 73analysis and energy requirements, potential harms and potential co-benefits, including job
102102 74creation or loss, industrial development, ecosystem sustainability, and advancement or
103103 75degradation of environmental equity or social justice. Following the publication of the survey,
104104 76the center shall conduct regional direct engagement with members of disadvantaged
105105 77communities throughout the commonwealth in order for the center to provide information
106106 78concerning the objectives, and intended benefits and outcomes of the carbon dioxide removal
107107 79pilot program and enable members of the public to provide comment and suggestions related to
108108 80the carbon dioxide removal pilot program's design, implementation and shared community
109109 81benefits.
110110 82 (c) Beginning in 2024, the center shall conduct an annual reverse auction for the
111111 83commonwealth’s advance market commitment. The center shall initiate the reverse auction on
112112 84April 1 and close the reverse auction on June 30 in each year during which a reverse auction is
113113 85held. The center shall conduct the reverse auction subject to the following requirements:
114114 86 (1) the center shall select qualifying bids, based on the criteria outlined in subsection (e)
115115 87of this section, sufficient to meet the annual removal target; provided, that if the total annual bid
116116 88is less than the annual removal target, the center shall increase the annual removal target in the
117117 89subsequent year by the difference between the annual removal target and the total annual bid;
118118 90and
119119 91 (2) at least 30 percent of the annual carbon removal target shall be met by carbon dioxide
120120 92removal projects that each deliver a maximum removal volume that does not exceed 10 percent 6 of 11
121121 93of the annual removal target, unless the center does not receive an adequate number of qualifying
122122 94bids proposing such projects;
123123 95 (3) at least 25 percent of the annual removal target shall be met by carbon dioxide
124124 96removal projects that have a minimum durability of 1,000 years; at least 50 percent of the annual
125125 97removal target shall be met by carbon dioxide removal projects that have a minimum durability
126126 98of 250 years; and 100 percent of the annual removal target shall be met by carbon dioxide
127127 99removal projects that have a minimum durability of 100 years; provided, that if the center does
128128 100not receive sufficient qualifying bids proposing carbon dioxide removal projects with 1,000- or
129129 101250-year durability to meet the requirements of this paragraph, it may modify the requirements
130130 102for projects with 1,000- or 250-year durability;
131131 103 (4) selected carbon dioxide removal projects will be compensated for carbon dioxide
132132 104removal provided over a maximum contract term of 10 years; payment shall be made on an
133133 105annual basis and contingent upon successful, complete and verified removal of the agreed upon
134134 106carbon dioxide from the atmosphere;
135135 107 (5) the maximum average price per ton of carbon dioxide removal shall be 350 dollars in
136136 1082024, and shall decrease by at least 5 percent each year, adjusted for inflation; the center shall
137137 109not accept qualifying bids causing the average price per ton of carbon dioxide removal to exceed
138138 110the maximum average price per ton for the year;
139139 111 (6) during the authorized 5-year term of the pilot program, the center will make an
140140 112advance market commitment to purchase carbon dioxide removal in the following quantities: (i)
141141 11310,000 tons of carbon dioxide equivalent emissions in 2024; (ii) 20,000 tons of carbon dioxide
142142 114equivalent emissions in 2025; (iii) 30,000 tons of carbon dioxide equivalent emissions in 2026; 7 of 11
143143 115(iv) 40,000 tons of carbon dioxide equivalent emissions in 2027; and (v) 50,000 tons of carbon
144144 116dioxide equivalent emissions in 2028;
145145 117 (7) the center shall publicly announce the winning bids, publicly release the winning
146146 118bidders' proposals and scorecards, and contract with the winning bidders no later than September
147147 11930 of each year in which reverse auction is held.
148148 120 (d) (i) Each bid submitted to the center shall contain the following information: (1) the
149149 121legal name, address, contact information and history of prior participation in the carbon dioxide
150150 122removal reverse auction, or other public or private-market purchases of carbon removal services,
151151 123for each entity or person submitting a bid; (2) the total volume of carbon dioxide removal to be
152152 124achieved pursuant to the bid; (3) when carbon dioxide removal will commence, and the delivery
153153 125term the proposed carbon dioxide removal project; (4) a description of the carbon dioxide
154154 126removal process and the carbon dioxide removal project; (5) a full life-cycle analysis of the
155155 127proposed carbon dioxide removal project, which demonstrates that the project will remove
156156 128carbon dioxide from the atmosphere and store it securely and durably in at least the quantity and
157157 129for at least the period committed to in the bid; (6) the and area and water volume which would be
158158 130required by the proposed carbon dioxide removal project; (7) a completed environmental justice
159159 131and community engagement report (8) a declaration that the carbon dioxide removal project will
160160 132not cause adverse impacts to the environment or disadvantaged communities; (9) a description of
161161 133the measurement, reporting and verification the bidder will employ for the carbon dioxide
162162 134removal project, from an independent third-party deemed acceptable by the center that verifies
163163 135all requirements of this section; (10) a legally binding attestation by each bidder that the
164164 136information provided is accurate and that all requirements of this section are met; and (11) any
165165 137additional information the center reasonably requests to assess the bid. 8 of 11
166166 138 (ii) All carbon dioxide removal and material operations of each proposed carbon dioxide
167167 139removal project submitted by bidders must be located within the commonwealth or waters within
168168 140fifty nautical miles of the commonwealth.
169169 141 (iii) Carbon dioxide removal project proposals shall not incorporate enhanced oil
170170 142recovery or otherwise facilitate the extraction, refinement or delivery of fossil fuel energy
171171 143sources including petroleum, natural gas and coal, or which serve to perpetuate fossil fuel use in
172172 144any sector of the economy in the commonwealth, the United States or globally.
173173 145 (iv) The carbon dioxide removal project for which the bid is submitted shall be unique to
174174 146this transaction and additional to any prior or otherwise existing or planned carbon dioxide
175175 147removal, may not be used as part of any other private or public transaction for carbon dioxide
176176 148removal, and shall create new and additional climate benefit, and not take credit for climate
177177 149benefit that would occur in a no-intervention scenario.
178178 150 (v) Carbon dioxide removal project proposals shall demonstrate the ability to commence
179179 151carbon dioxide removal no later than 2 years following the entering into contract with the center.
180180 152 (vi) Methods of carbon dioxide removal may include, but are not limited to: (1) terrestrial
181181 153mineralization or enhanced rock weathering; (2) terrestrial biomass-based pathways such as
182182 154biochar; (3) ocean-based pathways including electro-chemical alkalinity enhancement, marine
183183 155permaculture, deep-ocean sequestration of biomass, and coastal enhanced weathering; (4)
184184 156construction materials and products, the production of which directly contribute to the
185185 157sequestration of carbon dioxide or other greenhouse gases, including mass timber; and (5) direct
186186 158air capture with durable geologic sequestration, or durable sequestration in the built environment
187187 159including in concrete. 9 of 11
188188 160 (e) The center shall create a scorecard to evaluate the bids received based on the
189189 161following factors: (i) the price per ton of carbon dioxide removed; (ii) the extent to which the
190190 162project will promote equity or environmental justice within the commonwealth, including by
191191 163generating economic benefits to one or more disadvantaged communities (iii) the conservation
192192 164efficiency of the project in its use of water, land, and energy resources, with explicit preference
193193 165for projects with low water, land, and energy requirements and projects that exclusively employ
194194 166renewable energy; (iv) the number of jobs created by the project in the commonwealth; (v)
195195 167whether the project will employ at least one bona fide labor organization that is actively engaged
196196 168in representing employees providing necessary operations and maintenance services for the
197197 169project; (vi) whether and to what extent the project will involve the purchase of equipment and
198198 170supplies from businesses located in the commonwealth; (vii) whether the project will generate
199199 171significant agricultural, ecological, or ecosystem co-benefits or harms; (viii) the scale potential of
200200 172the carbon dioxide removal process; (ix) the durability of the proposed carbon dioxide removal
201201 173process; and (x) the delivery term for the proposed project, with a preference for carbon dioxide
202202 174removal that is delivered more quickly.
203203 175 (f) The center shall require each winning bidder to provide periodic verification from an
204204 176independent third party deemed satisfactory by the center that the volume of carbon dioxide
205205 177removed from the atmosphere and stored meets or exceeds the amount described in the bid and
206206 178that there has been no carbon dioxide equivalent leakage and no reduction in carbon dioxide
207207 179removal durability.
208208 180 A winning bidder, its successors, assigns, and transferees of responsibilities, liabilities,
209209 181rights or economic benefits of the carbon dioxide removal, shall be liable for the social cost, as 10 of 11
210210 182determined by the center, of any carbon dioxide equivalent leakage or reduction in carbon
211211 183dioxide removal durability.
212212 184 During the project contract period, carbon dioxide removal projects may be subject to
213213 185audit and review by the director of environmental justice to determine whether the winning
214214 186bidder is fulfilling and complying with all terms and stipulations in the environmental justice and
215215 187community engagement report approved by the director of environmental justice.
216216 188 Upon a failure by the winning bidder to provide the verification required by the center or
217217 189to fulfill or comply with all terms and stipulations in the environmental justice and community
218218 190engagement report approved by the director of environmental justice, the center may take action
219219 191to penalize the winning bidder, including, but not limited to: (i) termination of the contract; (ii)
220220 192levying fines or penalties against the bidder to recoup funds paid pursuant to the bid; or (iii)
221221 193rejection of future bids by the bidder.
222222 194 (g) Nothing in this section shall relieve any person, entity, or public agency of
223223 195compliance with other applicable federal, state, or local laws or regulations, including state air
224224 196and water quality requirements, and other requirements for protecting public health or the
225225 197environment.
226226 198 (h) If any word, phrase, clause, sentence, paragraph, section, or part of this section shall
227227 199be adjudged by any court of competent jurisdiction to be invalid, such judgment shall not affect,
228228 200impair, or invalidate the remainder thereof, but shall be confined in its operation to the word,
229229 201phrase, clause, sentence, paragraph, section, or part thereof directly involved in the controversy
230230 202in which such judgment shall have been rendered. 11 of 11
231231 203 (i) Funding for the administration of this section and for the authorized five-year reverse
232232 204auction period, beginning in 2024 and ending in 2028, shall be derived entirely from state
233233 205revenues that have been accrued in preceding tax years from certain reinstated taxes on sales of
234234 206aircraft or sales of repair or replacement parts exclusively for use in aircraft or in the significant
235235 207overhauling or rebuilding of aircraft or aircraft parts or components on a factory basis.
236236 208 (j) The center shall promulgate regulations for the administration and enforcement of this
237237 209section.
238238 210 SECTION 2. Section 6 of said Chapter 64H of the General Laws, as appearing in the
239239 2112020 Official Edition, is hereby amended by striking out subsections (uu) and (vv).