Massachusetts 2025-2026 Regular Session

Massachusetts House Bill H3230 Compare Versions

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2	2	HOUSE DOCKET, NO. 2087 FILED ON: 1/15/2025
3	3	HOUSE . . . . . . . . . . . . . . . No. 3230
4	4	The Commonwealth of Massachusetts
5	5	_________________
6	6	PRESENTED BY:
7	7	Jeffrey N. Roy
8	8	_________________
9	9	To the Honorable Senate and House of Representatives of the Commonwealth of Massachusetts in General
10	10	Court assembled:
11	11	The undersigned legislators and/or citizens respectfully petition for the adoption of the accompanying bill:
12	12	An Act advancing renewable heating solutions for the Commonwealth.
13	13	_______________
14	14	PETITION OF:
15	15	NAME:DISTRICT/ADDRESS :DATE ADDED:Jeffrey N. Roy10th Norfolk1/15/2025 1 of 17
16	16	HOUSE DOCKET, NO. 2087 FILED ON: 1/15/2025
17	17	HOUSE . . . . . . . . . . . . . . . No. 3230
18	18	By Representative Roy of Franklin, a petition (accompanied by bill, House, No. 3230) of Jeffrey
19	19	N. Roy relative to renewable heating programs and providing for certain tax credits. Revenue.
20	20	The Commonwealth of Massachusetts
21	21	_______________
22	22	In the One Hundred and Ninety-Fourth General Court
23	23	(2025-2026)
24	24	_______________
25	25	An Act advancing renewable heating solutions for the Commonwealth.
26	26	Be it enacted by the Senate and House of Representatives in General Court assembled, and by the authority
27	27	of the same, as follows:
28	28	1 SECTION 1. Section 3 of chapter 25 of the General Laws, as so appearing, is hereby
29	29	2amended by striking out, in line 14, the words “chapter 164” and inserting in place thereof the
30	30	3following words:- chapters 164 and 164C.
31	31	4 SECTION 2. Chapter 29 of the General Laws is hereby amended by inserting after
32	32	5section 2OOOOO, as inserted by section 13 of chapter 358 of the acts of 2020, the following
33	33	6section:-
34	34	7 Section 2PPPPP. (a)  There is hereby established and set up on the books of the
35	35	8commonwealth a fund known as the Renewable Heating Solutions Development Fund to be
36	36	9administered by the department of energy resources. The purpose of the fund shall be reduce the
37	37	10carbon intensity of the fuel consumed by end-use customers and increase the supply of
38	38	11renewable thermal resources through procurement of qualified renewable heating fuels and
39	39	12useful thermal energy from renewable thermal resources including environmental attributes for 2 of 17
40	40	13compliance use by obligated entities, as defined in section 1 of chapter 164C and consistent with
41	41	14Section 3A of Chapter 21N. There shall be credited to the fund all alternative compliance
42	42	15payments made by obligated entities as provided in section 2 of said chapter 164C. Amounts
43	43	16credited to the fund shall be expended without further appropriation. Money remaining in the
44	44	17fund at the end of a fiscal year shall not revert to the General Fund and shall be available for
45	45	18expenditure in subsequent fiscal years. No expenditure shall be made from said fund that shall
46	46	19cause said fund to be in deficit at the close of a fiscal year.
47	47	20 (b) Money in the fund shall be expended to: (i) stimulate investment in development of
48	48	21qualified renewable heating fuels and renewable thermal resources by entering into agreements,
49	49	22including multi-year agreements, for qualified renewable heating fuels and for renewable thermal
50	50	23resources including environmental attributes for the purposes of compliance with the renewable
51	51	24heat standard; (ii) provide technical and financial assistance for interconnection and feasibility
52	52	25studies, the development or the installation of qualified renewable heating fuel and renewable
53	53	26thermal resource projects; (iii) issue assurances or guarantees to support the acquisition of
54	54	27environmental attributes; (iv) establish escrows, reserves or acquire insurance for the obligations
55	55	28of the fund; and (v) pay administrative costs of the fund incurred not to exceed 10 per cent of the
56	56	29income of the fund, including, but not limited to, alternative compliance payments.
57	57	30 (c) The department shall adopt plans and guidelines for the management and use of the
58	58	31fund and enter into agreements with obligated entities to accept alternative compliance payments
59	59	32consistent with rules or purposes of the renewable heating standards established in said section 2
60	60	33of said chapter 164C. The department shall pursue opportunities at the state or federal level to
61	61	34advance the research and development of eligible resources, as defined in section 1 of said
62	62	35chapter 164C. 3 of 17
63	63	36 SECTION 3. Section 6 of chapter 62 of the General Laws, as amended by section 57 of
64	64	37chapter 358 of the acts of 2020, is hereby amended by adding the following 3 subsections:-
65	65	38 (x) (1) A partnership, limited liability corporation or other legal entity engaged in
66	66	39business in the commonwealth that: (i) is not a business corporation subject to the excise under
67	67	40chapter 63; and (ii) produces qualified renewable heating fuels, as defined in section 1 of chapter
68	68	41164C, shall be allowed a refundable credit against its excise due under this chapter.
69	69	42 (2) The credit under this subsection shall be attributed on a pro rata basis to the owners,
70	70	43partners or members of the legal entity entitled to the credit under this subsection and shall be
71	71	44allowed as a credit against the tax due under this chapter from the owners, partners or members
72	72	45in a manner determined by the commissioner.
73	73	46 (3) The commissioner, in consultation with the commissioner of energy resources, shall
74	74	47promulgate regulations for the administration and implementation of this subsection.
75	75	48 (y) (1) As used in this subsection the following terms shall, unless the context clearly
76	76	49requires otherwise, have the following meanings:
77	77	50 “Geothermal district heating”, as defined in section 1 of chapter 164C.
78	78	51 “Qualified heating equipment”, renewable heating systems approved by the department
79	79	52of energy resources, including but not limited to air source heat pumps, ground source heat
80	80	53pumps, and heating equipment using renewable hydrogen and renewable propane.
81	81	54 “Renewable hydrogen,” as defined in section 1 of Chapter 164C.
82	82	55 “Taxpayer”, a taxpayer subject to taxation under this chapter. 4 of 17
83	83	56 (2) A taxpayer shall be allowed a tax credit against the taxes imposed by this chapter
84	84	57equal to 30 per cent of the total qualified expenditures incurred in connection with the purchase
85	85	58and installation of qualified heating equipment during the taxable year; provided, however, that
86	86	59the amount of credit allowed shall not exceed 30 per cent of the net expenditure for renewable
87	87	60energy source property.
88	88	61 (3) If the amount of the credit allowed under this subsection exceeds the taxpayer's tax
89	89	62liability, the commissioner shall treat the excess as an overpayment and shall pay the taxpayer
90	90	63the entire amount of the excess.
91	91	64 (4) The commissioner, in consultation with the commissioner of energy resources, shall
92	92	65promulgate regulations for the administration and implementation of this subsection.
93	93	66 (z) (1) As used in this subsection the following terms shall, unless the context clearly
94	94	67requires otherwise, have the following meanings:
95	95	68 (2) A taxpayer shall be allowed a tax credit against the taxes imposed by this chapter
96	96	69equal to 30 per cent of the total qualified expenditures incurred in connection with the purchase
97	97	70and installation of geothermal district heating infrastructure during the taxable year.
98	98	71 (3) If the amount of the credit allowed under this subsection exceeds the taxpayer's tax
99	99	72liability, the commissioner shall treat the excess as an overpayment and shall pay the taxpayer
100	100	73the entire amount of the excess.
101	101	74 (4) The commissioner, in consultation with the commissioner of energy resources, shall
102	102	75promulgate regulations for the administration and implementation of this subsection. 5 of 17
103	103	76 SECTION 4. Chapter 63 of the General Laws is hereby amended by inserting after
104	104	77section 38MM, as appearing in the 2022 Official Edition, the following 3 sections:-
105	105	78 Section 38NN. There is hereby established a qualified renewable heating fuels production
106	106	79tax credit. A corporation engaged in business in the commonwealth that produces qualified
107	107	80renewable heating fuels, as defined in section 1 of chapter 164C, shall be allowed a refundable
108	108	81credit against its excise due under this chapter. The credit shall be equal to 30 per cent of the
109	109	82total qualified expenditures incurred in connection with the purchase and installation of
110	110	83equipment for the production of qualified renewable heating fuels.
111	111	84 The credit allowed under this section shall be allowed for the taxable year in which the
112	112	85production of qualified renewable heating fuels or purchase of equipment to produce qualified
113	113	86renewable heating fuels is made. The commissioner, in consultation with the commissioner of
114	114	87energy resources, shall promulgate regulations for the administration and implementation of this
115	115	88section.
116	116	89 Section 38OO. There is hereby established a renewable heating systems tax credit. A
117	117	90corporation engaged in business in the commonwealth that purchases or installs qualified heating
118	118	91equipment, as defined in paragraph (1) of subsection (y) of section 6 of chapter 62, shall be
119	119	92allowed a refundable credit against its excise due under this chapter equal to 30 per cent of the
120	120	93total qualified expenditures incurred in connection with said purchase and installation during the
121	121	94taxable year; provided, however, that the amount of credit allowed shall not exceed 30 per cent
122	122	95of the net expenditure for renewable energy source property.
123	123	96 The credit allowed under this section shall be allowed for the taxable year in which the
124	124	97purchase or installation of qualified heating equipment is made. The commissioner, in 6 of 17
125	125	98consultation with the commissioner of energy resources, shall promulgate regulations for the
126	126	99administration and implementation of this section.
127	127	100 Section 38PP. There is hereby established a geothermal district heating infrastructure tax
128	128	101credit. A corporation engaged in business in the commonwealth that purchases or installs
129	129	102infrastructure supporting geothermal district heating, as defined in section 1 of chapter 164C,
130	130	103shall be allowed a refundable credit against its excise due under this chapter equal to 30 per cent
131	131	104of the total qualified expenditures incurred in connection with said purchase and installation
132	132	105during the taxable year.
133	133	106 The credit allowed under this section shall be allowed for the taxable year in which the
134	134	107purchase or installation of qualified heating equipment is made. The commissioner, in
135	135	108consultation with the commissioner of energy resources, shall promulgate regulations for the
136	136	109administration and implementation of this section.
137	137	110 SECTION 5. The General Laws are hereby amended by inserting after chapter 164B the
138	138	111following chapter:-
139	139	112 Chapter 164C
140	140	113 Renewable Heating Solutions
141	141	114 Section 1. As used in this chapter the following terms shall, unless the context clearly
142	142	115requires otherwise, have the following meanings:
143	143	116 "Alternative compliance payment", a payment to the renewable heating solutions
144	144	117development fund established in section 2PPPPP of chapter 29, which may be made in lieu of
145	145	118standard means of compliance with this statute. 7 of 17
146	146	119 “Biogas”, a mixture of carbon dioxide and hydrocarbons, primarily methane gas, released
147	147	120from the biological decomposition of organic materials, which can be upgraded to meet the
148	148	121standards for injection into a common carrier pipeline.
149	149	122 “Biomass”, energy feedstocks that can be converted or upgraded to meet the standards for
150	150	123injection into a common carrier pipeline, including brush; stumps; lumber ends and trimmings;
151	151	124wood pallets; bark; wood chips; shavings; slash and other clean wood; agricultural waste; food
152	152	125and vegetative material; energy crops; landfill methane; or biogas.
153	153	126 "Commission", the commonwealth utilities commission established in section 2 of
154	154	127chapter 25.
155	155	128 “Carbon intensity” means the quantity of full lifecycle greenhouse gas emissions per unit
156	156	129of fuel energy.
157	157	130 "Compliance year", a calendar year beginning January 1 and ending December 31 for
158	158	131which an obligated entity must demonstrate that it has met the requirements of this chapter.
159	159	132 “Department”, the department of energy resources.
160	160	133 “District heating”, systems that (i) provide useful thermal energy to multiple buildings
161	161	134from a central resource; (ii) distribute useful thermal energy among buildings connected to a
162	162	135common thermal network; or (iii) both provide and distribute useful thermal energy.
163	163	136 “Eligible resources”, resources producing qualified renewable heating fuels or useful
164	164	137thermal energy from a renewable thermal resource where the energy produced by the resource is:
165	165	138(i) delivered into the commonwealth for use by the commonwealth’s end-use customers; or (ii)
166	166	139used to provide heating service to customers in the commonwealth. Delivery of energy from an 8 of 17
167	167	140eligible resource may include: (1) a unit-specific bilateral contract for the sale and delivery of the
168	168	141energy into the commonwealth; (2) confirmation from the appropriate control entity that the
169	169	142renewable energy was actually settled in the system; or (3) any other requirements as the
170	170	143department deems appropriate.
171	171	144 “Environmental attributes”, any credits, emissions reductions, offsets, allowances or
172	172	145other benefits attributable to the production and delivery of qualified renewable heating fuels or
173	173	146renewable thermal resources. The attributes for qualified renewable heating fuels shall include,
174	174	147but are not limited to, the avoided greenhouse gas emissions associated with the production,
175	175	148transport, and combustion of a quantity of alternative fuels compared with the same quantity of
176	176	149geologic natural gas.
177	177	150 “Full life cycle greenhouse gas emissions”, (1) lifecycle greenhouse gas emissions
178	178	151pursuant to section 7545(o)(1)(H) of title 42 of the United States code, and (2) include any
179	179	152associated abatement of greenhouse gases including methane.
180	180	153 “Geothermal district heating”, the utilization of useful thermal energy generated and
181	181	154stored in the earth to provide heat to buildings and industry through a distribution network.
182	182	155 “Natural gas utility”, a natural gas local distribution company.
183	183	156 “Obligated entity", a person or entity that sells natural gas to end-use customers.
184	184	157 “Qualified investment”, any capital investment in gas delivery infrastructure or
185	185	158renewable thermal infrastructure incurred by a natural gas utility for the purpose of providing
186	186	159natural gas service or useful thermal energy from a renewable thermal resource while complying
187	187	160with the renewable heating standard. Qualified investments include costs of procurement of 9 of 17
188	188	161qualified renewable heating fuels or useful thermal energy from a renewable thermal resource
189	189	162from third parties that contribute to the obligated entity meeting the targets set forth in this
190	190	163chapter. Qualified investments for qualified renewable heating fuels also include (i) a facility or
191	191	164any part of the equipment located at a facility that is used to create, gather and process biogas
192	192	165into renewable natural gas; inject renewable natural gas into an existing natural gas pipeline; or
193	193	166determine the constituents of renewable natural gas before the injection of the renewable natural
194	194	167gas into an existing natural gas pipeline; or (ii) a facility or part of equipment located at a facility
195	195	168that is used to create, gather, methanate or inject renewable hydrogen into an existing natural gas
196	196	169pipeline.
197	197	170 “Qualified renewable heating fuels”, renewable natural gas, renewable hydrogen, and
198	198	171renewable propane.
199	199	172 “Renewable heating standard” or “standard”, the required percentage reduction in carbon
200	200	173intensity described in subsection (a) of section 2.
201	201	174 “Renewable hydrogen”, hydrogen produced with electricity generated from renewable
202	202	175energy systems. Renewable energy systems include those that generate electric or thermal energy
203	203	176through the use of solar thermal, photovoltaics, wind, hydroelectric, geothermal electric,
204	204	177geothermal ground source heat, biogas produced by the anaerobic digestion or fermentation of
205	205	178biodegradable materials, tidal energy, wave energy, ocean thermal and fuel cells that do not
206	206	179utilize a fossil fuel resource.
207	207	180 “Renewable natural gas”, pipeline quality gas derived from any combination of biogas,
208	208	181biomass, the methanation of hydrogen and waste carbon dioxide, or the thermal gasification of 10 of 17
209	209	182sustainable feedstocks, where the use of the fuel results in lower lifecycle greenhouse gas
210	210	183emissions than geologic natural gas.
211	211	184 “Renewable propane” derived from any combination of the creation of renewable liquid
212	212	185fuels and biogases, plant materials, cellulosic and anerobic digestion processes, and future
213	213	186innovative blends or other recycled material processes, where the use of the fuel results in lower
214	214	187lifecycle greenhouse gas emissions than geologic propane.
215	215	188 “Renewable thermal district heating”, district heating relying primarily on useful thermal
216	216	189energy from a renewable thermal resource.
217	217	190 “Renewable thermal infrastructure”, infrastructure for the conversion or distribution of
218	218	191thermal energy from a renewable thermal resource.
219	219	192 “Renewable thermal resource”, any facility that generates useful thermal energy using:
220	220	193(i)  naturally occurring temperature differences in ground, air or water, via geothermal ground
221	221	194loop, ambient water loop, air source heat pump or other technology; (ii) excess thermal energy,
222	222	195also referred to as waste heat, from building energy systems or commercial processes; (iii)
223	223	196sunlight; (iv) combined heat and power; or (v) energy efficient steam technology.
224	224	197 “Useful thermal energy”, (i) energy in the form of direct heat, steam, hot water or another
225	225	198thermal form that is used in production for which fuel or electricity would otherwise be
226	226	199consumed; and (ii) beneficial measures for heating, cooling, humidity control, process use or
227	227	200other valid thermal end use energy requirements for which fuel or electricity would otherwise be
228	228	201consumed. 11 of 17
229	229	202 Section 2. (a) Beginning in compliance year 2027, each obligated entity shall reduce the
230	230	203carbon intensity of gas delivered or transported annually by the obligated entity in the
231	231	204Commonwealth by at least 2 per cent. Beginning in compliance year 2030, each obligated entity
232	232	205shall reduce the carbon intensity of gas delivered or transported annually by the obligated entity
233	233	206in the Commonwealth by at least 7.5 per cent. Beginning in compliance year 2035, each
234	234	207obligated entity shall reduce the carbon intensity of gas delivered or transported annually by the
235	235	208obligated entity in the Commonwealth by at least 20 per cent, continuing thereafter.
236	236	209 (b) If the department determines that achievement of the renewable heating standards has
237	237	210adversely impacted the affordability of gas LDC customer bills, the department may temporarily
238	238	211suspend compliance for the next compliance year immediately following the determination.
239	239	212 (c) The department shall review whether adjustments to the renewable heating standards
240	240	213for the following 2 compliance years are necessary to ensure that the increase in customer bills
241	241	214remains affordable. This review shall assess the total incremental annual cost to meet the
242	242	215renewable heating standards, including accounting for (i) any value received by a natural gas
243	243	216utility upon any resale of eligible resources, such as any environmental credits or other credits
244	244	217associated with environmental attributes; and (ii) any savings achieved through avoidance of
245	245	218conventional gas purchases or development, such as avoided pipeline costs or carbon costs.
246	246	219 (d) The department may adjust prospective compliance year targets described in
247	247	220subsection (a); provided, however, that the cumulative annual percentage of natural gas sold
248	248	221shall comply with the 2035 target.
249	249	222 (e) If the department determines that there are not enough eligible resources to meet the
250	250	223targets identified in subsection (a) within the constraints of subsections (b) to (d), inclusive, the 12 of 17
251	251	224department may recommend natural gas utilities develop qualified investments sufficient to meet
252	252	225the targets.
253	253	226 (f) The department shall ensure that the reductions in carbon intensity in subsection (a)
254	254	227are consistent with Section 3A of Chapter 21N.
255	255	228 Section 3. (a) Compliance of an obligated entity with the renewable heating standard may
256	256	229be demonstrated through: (i) sale of qualified renewable heating fuels or useful thermal energy
257	257	230from a renewable thermal resource and their associated environmental attributes to customers in
258	258	231Massachusetts; (ii) procurement of environmental attributes by obligated entities representing
259	259	232qualified GHG emissions reductions in a system of record designated by the department (iii)
260	260	233payment of alternative compliance payments to the renewable heating solutions development
261	261	234fund established in section 2PPPPP of chapter 29; or (iv) any combination of qualified renewable
262	262	235heating fuel procurement, renewable thermal resource procurement, environmental attribute
263	263	236procurement, or alternative compliance payments.. The commissioner shall promulgate rules and
264	264	237regulations for the payment of alternative compliance payments.
265	265	238 (b) To procure environmental attributes an obligated entity’s production source shall be
266	266	239certified by the department as using eligible resources. Use of eligible resources shall be
267	267	240evidenced by reports issued by the commissioner of energy resources.
268	268	241 (c) In meeting the obligations of the renewable heating standards, to the extent feasible
269	269	242and consistent with state and federal law, all investments, projects and activities undertaken
270	270	243pursuant to this chapter by any person or the department shall provide employment opportunities
271	271	244for all segments of the population and workforce, including minority-owned and female-owned
272	272	245business enterprises, and utilize labor and materials within the commonwealth to ensure the 13 of 17
273	273	246environmental benefits of avoided carbon emissions are not diminished by emissions associated
274	274	247with the transportation of labor or materials. The investments, projects and activities shall not
275	275	248discriminate based on race or socioeconomic status.
276	276	249 (d) The commissioner of energy resources shall promulgate rules and regulations for the
277	277	250implementation of the renewable heating standards on or before July 1, 2025. The rules and
278	278	251regulations shall include, but be limited to, provisions for:
279	279	252 (i) verification of eligibility and production of eligible resources, as well as the energy
280	280	253content of qualified renewable heating fuels and useful thermal energy from a renewable thermal
281	281	254resource, including requirements to notify the department in the event of a change in status,
282	282	255monitor qualified facilities to ensure annual average energy content matches the expected
283	283	256generation of environmental attributes;
284	284	257 (ii) certification of eligible resources by issuing statements of qualification within 90 days
285	285	258of application, including prospective reviews for applicants seeking to determine whether a
286	286	259facility would be eligible;
287	287	260 (iii) annual compliance filings to be made by all obligated entities within 1 month after
288	288	261tracking system data is available for the fourth quarter of each calendar year; provided, that all
289	289	262obligated entities shall cooperate with the department in providing data necessary to assess the
290	290	263magnitude of obligation and verify the compliance of all obligated entities;
291	291	264 (iv) sanctions for obligated entities that, after investigation, have been found to fail to
292	292	265reasonably comply with the renewable heating standards or department rules and regulations;
293	293	266provided, that no sanction or penalty shall relieve or diminish an obligated entity from liability
294	294	267for fulfilling any shortfall in its compliance obligation; provided further, that no sanction shall be 14 of 17
295	295	268imposed if compliance is achieved through alternative compliance payments; provided further,
296	296	269that the department may suspend or revoke the certification of eligible resources that provide
297	297	270false information or fail to notify the department in the event of a change in eligibility status or
298	298	271otherwise comply with department rules; and provided further, that financial penalties resulting
299	299	272from sanctions from obligated entities shall not be recoverable in rates;
300	300	273 (v) mechanisms for the purposes of easing compliance burdens, facilitating bringing new
301	301	274eligible resources on-line and avoiding or mitigating conflicts with state-level source disclosure
302	302	275requirements and green marketing claims throughout the region; provided, that mechanisms shall
303	303	276allow obligated entities to demonstrate compliance over a compliance year and bank excess
304	304	277compliance for 2 subsequent compliance years, capped at 20 per cent of the current year's
305	305	278obligation; and
306	306	279 (vi) public reporting on the status of the implementation of standards, including the
307	307	280comparative use of environmental attributes and alternative compliance payments and the
308	308	281amount of rate increases authorized by the standards.
309	309	282 Section 4. The commission shall adopt regulations authorizing cost recovery by natural
310	310	283gas local distribution companies of all prudent incremental costs arising from the implementation
311	311	284of the renewable heating standards, including, without limitation: (i) the purchase of qualified
312	312	285renewable heating fuels or useful thermal energy from renewable thermal resources or
313	313	286environmental attributes or the payment of alternative compliance payments; (ii) required
314	314	287payments to support assessments for compliance purposes; (iii) the incremental costs of
315	315	288complying with energy source disclosure requirements; (iv) qualified infrastructure investments
316	316	289or other activities that will grow the supply and utilization of qualified renewable heating fuels 15 of 17
317	317	290and useful thermal energy from renewable thermal resources and provide environmental benefits
318	318	291to the commonwealth, including approval of investment in conditioning, injection and
319	319	292distribution infrastructure, such as extending the transmission or distribution system for the
320	320	293purpose of interconnection with a qualified facility; (v) making a financial investment for the
321	321	294purposes of interconnecting a qualified facility or otherwise ensuring  that gas created by the
322	322	295facility can be delivered to customers in accordance with statutory  requirements for injection,
323	323	296compression, quality, and safety or other department or federal regulatory requirements; (vi)
324	324	297participating in a state or federal renewable energy program or project, if participation by the
325	325	298natural gas local distribution company (1) consists of the purchase or sale of gas produced or
326	326	299environmental attributes and (2) results in a reduction of the cost of gas produced to the
327	327	300company’s customers; (vii) providing customers with the option to purchase gas produced from a
328	328	301qualified investment, with or without environmental attributes, directly from the natural gas local
329	329	302distribution company; (viii) any other activity that develops qualified renewable heating fuel
330	330	303sources or renewable thermal resources, advances the sale of qualified renewable heating fuel
331	331	304sources or renewable thermal resources, or promotes the diversification in energy supply within
332	332	305the commonwealth to advance the commonwealth’s environmental or climate goals; and (ix)
333	333	306geothermal district heating investments. Costs may be recovered by means of an automatic
334	334	307adjustment clause or any other recovery mechanism authorized by rule. Costs incurred from
335	335	308clause ix may be recovered from customers receiving heating and cooling services as a result of
336	336	309said investment, or from gas delivery customers, until such time as a class of geothermal district
337	337	310heating customers can be established by the commission. Once a class of geothermal district
338	338	311heating customers has been established, the commission shall investigate the appropriate cost 16 of 17
339	339	312allocation and recovery of any geothermal district heating investments made prior to the
340	340	313establishment of the class.
341	341	314 Section 5. The department shall conduct a qualified renewable heating fuels inventory,
342	342	315which shall include:
343	343	316 (i) a list of the existing eligible resources, including the location, an estimate of lifecycle
344	344	317greenhouse gas emissions and an assessment of supply chain infrastructure associated with each
345	345	318eligible resource;
346	346	319 (ii) a list of the potential qualified renewable heating fuel sources, including the estimated
347	347	320potential production quantities and energy content of sources;
348	348	321 (iii) discussion of the best use or uses for potential qualified renewable heating fuel
349	349	322sources, taking into account estimated lifecycle greenhouse gas emissions, costs and whether the
350	350	323potential source can be used to address local gas or electric constraints; and
351	351	324 (iv) a description of the technologies available for use at each potential qualified
352	352	325renewable heating fuel source, including estimates from qualified renewable heating fuel
353	353	326sources, small renewable energy generating facilities, as defined in section 143 of chapter 164,
354	354	327renewable energy facilities that would be otherwise curtailed, or renewable energy generating
355	355	328sources, as defined in subsection (b) of section 11F of chapter 25A,
356	356	329 Section 6. The department shall research and determine gas quality standards for the
357	357	330injection of renewable natural gas, renewable hydrogen and any other resources qualifying for
358	358	331the renewable heating standards into the common carrier pipeline system. The purpose of the
359	359	332standards shall be to identify acceptable levels of constituents of concern for safety and 17 of 17
360	360	333environmental purposes, including ensuring pipeline integrity, while providing reasonable and
361	361	334predictable access to pipeline transmission and distribution facilities. The department shall
362	362	335consult industry groups and neighboring jurisdictions, and identify industry best practices in
363	363	336establishing the standards.
364	364	337 Section 7. The department may review and approve siting of renewable hydrogen
365	365	338production and delivery facilities and infrastructure.
366	366	339 SECTION 6. The credit established in subsection (y) of section 6 of chapter 62 shall be
367	367	340available in tax years 2026, 2027, 2028, 2029, and 2030.
368	368	341 SECTION 7. The gas quality standards established in section 6 of chapter 164C shall take
369	369	342effect not later than July 1, 2027.