Massachusetts 2025-2026 Regular Session

Massachusetts Senate Bill S1998 Compare Versions

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2	2	SENATE DOCKET, NO. 2110 FILED ON: 1/17/2025
3	3	SENATE . . . . . . . . . . . . . . No. 1998
4	4	The Commonwealth of Massachusetts
5	5	_________________
6	6	PRESENTED BY:
7	7	Paul R. Feeney
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 :Paul R. FeeneyBristol and Norfolk 1 of 17
16	16	SENATE DOCKET, NO. 2110 FILED ON: 1/17/2025
17	17	SENATE . . . . . . . . . . . . . . No. 1998
18	18	By Mr. Feeney, a petition (accompanied by bill, Senate, No. 1998) of Paul R. Feeney for
19	19	legislation to advance renewable heating solutions for the Commonwealth. Revenue.
20	20	[SIMILAR MATTER FILED IN PREVIOUS SESSION
21	21	SEE SENATE, NO. 1822 OF 2023-2024.]
22	22	The Commonwealth of Massachusetts
23	23	_______________
24	24	In the One Hundred and Ninety-Fourth General Court
25	25	(2025-2026)
26	26	_______________
27	27	An Act advancing renewable heating solutions for the Commonwealth.
28	28	Be it enacted by the Senate and House of Representatives in General Court assembled, and by the authority
29	29	of the same, as follows:
30	30	1 SECTION 1. Section 3 of chapter 25 of the General Laws, as so appearing, is hereby
31	31	2amended by striking out, in line 14, the words “chapter 164” and inserting in place thereof the
32	32	3following words:- chapters 164 and 164C.
33	33	4 SECTION 2. Chapter 29 of the General Laws is hereby amended by inserting after
34	34	5section 2OOOOO, as inserted by section 13 of chapter 358 of the acts of 2020, the following
35	35	6section:-
36	36	7 Section 2PPPPP. (a)  There is hereby established and set up on the books of the
37	37	8commonwealth a fund known as the Renewable Heating Solutions Development Fund to be
38	38	9administered by the department of energy resources. The purpose of the fund shall be reduce the
39	39	10carbon intensity of the fuel consumed by end-use customers and increase the supply of 2 of 17
40	40	11renewable thermal resources through procurement of qualified renewable heating fuels and
41	41	12useful thermal energy from renewable thermal resources including environmental attributes for
42	42	13compliance use by obligated entities, as defined in section 1 of chapter164C and consistent with
43	43	14Section 3A of Chapter 21N. There shall be credited to the fund all alternative compliance
44	44	15payments made by obligated entities as provided in section 2 of said chapter 164C. Amounts
45	45	16credited to the fund shall be expended without further appropriation. Money remaining in the
46	46	17fund at the end of a fiscal year shall not revert to the General Fund and shall be available for
47	47	18expenditure in subsequent fiscal years. No expenditure shall be made from said fund that shall
48	48	19cause said fund to be in deficit at the close of a fiscal year.
49	49	20 (b) Money in the fund shall be expended to: (i) stimulate investment in development of
50	50	21qualified renewable heating fuels and renewable thermal resources by entering into agreements,
51	51	22including multi-year agreements, for qualified renewable heating fuels and for renewable thermal
52	52	23resources including environmental attributes for the purposes of compliance with the renewable
53	53	24heat standard; (ii) provide technical and financial assistance for interconnection and feasibility
54	54	25studies, the development or the installation of qualified renewable heating fuel and renewable
55	55	26thermal resource projects; (iii) issue assurances or guarantees to support the acquisition of
56	56	27environmental attributes; (iv) establish escrows, reserves or acquire insurance for the obligations
57	57	28of the fund; and (v) pay administrative costs of the fund incurred not to exceed 10 percent of the
58	58	29income of the fund, including, but not limited to, alternative compliance payments.
59	59	30 (c) The department shall adopt plans and guidelines for the management and use of the
60	60	31fund and enter into agreements with obligated entities to accept alternative compliance payments
61	61	32consistent with rules or purposes of the renewable heating standards established in said section 2
62	62	33of said chapter 164C. The department shall pursue opportunities at the state or federal level to 3 of 17
63	63	34advance the research and development of eligible resources, as defined in section 1 of said
64	64	35chapter 164C.
65	65	36 SECTION 3. Section 6 of chapter 62 of the General Laws, as amended by section 57 of
66	66	37chapter 358 of the acts of 2020, is hereby amended by adding the following 3 subsections:-
67	67	38 (x) (1) A partnership, limited liability corporation or other legal entity engaged in
68	68	39business in the commonwealth that: (i) is not a business corporation subject to the excise under
69	69	40chapter 63; and (ii) produces qualified renewable heating fuels, as defined in section 1 of chapter
70	70	41164C, shall be allowed a refundable credit against its excise due under this chapter.
71	71	42 (2) The credit under this subsection shall be attributed on a pro rata basis to the owners,
72	72	43partners or members of the legal entity entitled to the credit under this subsection and shall be
73	73	44allowed as a credit against the tax due under this chapter from the owners, partners or members
74	74	45in a manner determined by the commissioner.
75	75	46 (3) The commissioner, in consultation with the commissioner of energy resources, shall
76	76	47promulgate regulations for the administration and implementation of this subsection.
77	77	48 (y) (1) As used in this subsection the following terms shall, unless the context clearly
78	78	49requires otherwise, have the following meanings:
79	79	50 “Geothermal district heating”, as defined in section 1 of chapter 164C.
80	80	51 “Qualified heating equipment”, renewable heating systems approved by the department
81	81	52of energy resources, including but not limited to air source heat pumps, ground source heat
82	82	53pumps, and heating equipment using renewable hydrogen and renewable propane.
83	83	54 “Renewable hydrogen,” as defined in section 1 of Chapter 164C. 4 of 17
84	84	55 “Taxpayer”, a taxpayer subject to taxation under this chapter.
85	85	56 (2) A taxpayer shall be allowed a tax credit against the taxes imposed by this chapter
86	86	57equal to 30 percent of the total qualified expenditures incurred in connection with the purchase
87	87	58and installation of qualified heating equipment during the taxable year; provided, however, that
88	88	59the amount of credit allowed shall not exceed 30 percent of the net expenditure for renewable
89	89	60energy source property.
90	90	61 (3) If the amount of the credit allowed under this subsection exceeds the taxpayer's tax
91	91	62liability, the commissioner shall treat the excess as an overpayment and shall pay the taxpayer
92	92	63the entire amount of the excess.
93	93	64 (4) The commissioner, in consultation with the commissioner of energy resources, shall
94	94	65promulgate regulations for the administration and implementation of this subsection.
95	95	66 (z) (1) As used in this subsection the following terms shall, unless the context clearly
96	96	67requires otherwise, have the following meanings:
97	97	68 (2) A taxpayer shall be allowed a tax credit against the taxes imposed by this chapter
98	98	69equal to 30 percent of the total qualified expenditures incurred in connection with the purchase
99	99	70and installation of geothermal district heating infrastructure during the taxable year.
100	100	71 (3) If the amount of the credit allowed under this subsection exceeds the taxpayer's tax
101	101	72liability, the commissioner shall treat the excess as an overpayment and shall pay the taxpayer
102	102	73the entire amount of the excess.
103	103	74 (4) The commissioner, in consultation with the commissioner of energy resources, shall
104	104	75promulgate regulations for the administration and implementation of this subsection. 5 of 17
105	105	76 SECTION 4. Chapter 63 of the General Laws is hereby amended by inserting after
106	106	77section 38HH, as appearing in the 2018 Official Edition, the following 3 sections:-
107	107	78 Section 39II. There is hereby established a qualified renewable heating fuels production
108	108	79tax credit. A corporation engaged in business in the commonwealth that produces qualified
109	109	80renewable heating fuels, as defined in section 1 of chapter 164C, shall be allowed a refundable
110	110	81credit against its excise due under this chapter. The credit shall be equal to 30 percent of the total
111	111	82qualified expenditures incurred in connection with the purchase and installation of equipment for
112	112	83the production of qualified renewable heating fuels.
113	113	84 The credit allowed under this section shall be allowed for the taxable year in which the
114	114	85production of qualified renewable heating fuels or purchase of equipment to produce qualified
115	115	86renewable heating fuels is made. The commissioner, in consultation with the commissioner of
116	116	87energy resources, shall promulgate regulations for the administration and implementation of this
117	117	88section.
118	118	89 Section 39JJ. There is hereby established a renewable heating systems tax credit. A
119	119	90corporation engaged in business in the commonwealth that purchases or installs qualified heating
120	120	91equipment, as defined in paragraph (1) of subsection (y) of section 6 of chapter 62, shall be
121	121	92allowed a refundable credit against its excise due under this chapter equal to 30 percent of the
122	122	93total qualified expenditures incurred in connection with said purchase and installation during the
123	123	94taxable year; provided, however, that the amount of credit allowed shall not exceed 30 percent of
124	124	95the net expenditure for renewable energy source property.
125	125	96 The credit allowed under this section shall be allowed for the taxable year in which the
126	126	97purchase or installation of qualified heating equipment is made. The commissioner, in 6 of 17
127	127	98consultation with the commissioner of energy resources, shall promulgate regulations for the
128	128	99administration and implementation of this section.
129	129	100 Section 39KK. There is hereby established a geothermal district heating infrastructure tax
130	130	101credit. A corporation engaged in business in the commonwealth that purchases or installs
131	131	102infrastructure supporting geothermal district heating, as defined in section 1 of chapter 164C,
132	132	103shall be allowed a refundable credit against its excise due under this chapter equal to 30 percent
133	133	104of the total qualified expenditures incurred in connection with said purchase and installation
134	134	105during the taxable year.
135	135	106 The credit allowed under this section shall be allowed for the taxable year in which the
136	136	107purchase or installation of qualified heating equipment is made. The commissioner, in
137	137	108consultation with the commissioner of energy resources, shall promulgate regulations for the
138	138	109administration and implementation of this section.
139	139	110 SECTION 5. The General Laws are hereby amended by inserting after chapter 164B the
140	140	111following chapter:-
141	141	112 Chapter 164C
142	142	113 Renewable Heating Solutions
143	143	114 Section 1. As used in this chapter the following terms shall, unless the context clearly
144	144	115requires otherwise, have the following meanings:
145	145	116 "Alternative compliance payment", a payment to the renewable heating solutions
146	146	117development fund established in section 2PPPPP of chapter 29, which may be made in lieu of
147	147	118standard means of compliance with this statute. 7 of 17
148	148	119 “Biogas”, a mixture of carbon dioxide and hydrocarbons, primarily methane gas, released
149	149	120from the biological decomposition of organic materials, which can be upgraded to meet the
150	150	121standards for injection into a common carrier pipeline.
151	151	122 “Biomass”, energy feedstocks that can be converted or upgraded to meet the standards for
152	152	123injection into a common carrier pipeline, including brush; stumps; lumber ends and trimmings;
153	153	124wood pallets; bark; wood chips; shavings; slash and other clean wood; agricultural waste; food
154	154	125and vegetative material; energy crops; landfill methane; or biogas.
155	155	126 "Commission", the commonwealth utilities commission established in section 2 of
156	156	127chapter 25.
157	157	128 “Carbon intensity” means the quantity of full lifecycle greenhouse gas emissions per unit
158	158	129of fuel energy.
159	159	130 "Compliance year", a calendar year beginning January 1 and ending December 31 for
160	160	131which an obligated entity must demonstrate that it has met the requirements of this chapter.
161	161	132 “Department”, the department of energy resources.
162	162	133 “District heating”, systems that (i) provide useful thermal energy to multiple buildings
163	163	134from a central resource; (ii) distribute useful thermal energy among buildings connected to a
164	164	135common thermal network; or (iii) both provide and distribute useful thermal energy.
165	165	136 “Eligible resources”, resources producing qualified renewable heating fuels or useful
166	166	137thermal energy from a renewable thermal resource where the energy produced by the resource is:
167	167	138(i) delivered into the commonwealth for use by the commonwealth’s end-use customers; or (ii)
168	168	139used to provide heating service to customers in the Commonwealth. Delivery of energy from an 8 of 17
169	169	140eligible resource may include: (1) a unit-specific bilateral contract for the sale and delivery of the
170	170	141energy into the commonwealth; (2) confirmation from the appropriate control entity that the
171	171	142renewable energy was actually settled in the system; or (3) any other requirements as the
172	172	143department deems appropriate.
173	173	144 “Environmental attributes”, any credits, emissions reductions, offsets, allowances or
174	174	145other benefits attributable to the production and delivery of qualified renewable heating fuels or
175	175	146renewable thermal resources. The attributes for qualified renewable heating fuels shall include,
176	176	147but are not limited to, the avoided greenhouse gas emissions associated with the production,
177	177	148transport, and combustion of a quantity of alternative fuels compared with the same quantity of
178	178	149geologic natural gas.
179	179	150 “Full life cycle greenhouse gas emissions”, (1) lifecycle greenhouse gas emissions
180	180	151pursuant to section 7545(o)(1)(H) of title 42 of the United States code, and (2) include any
181	181	152associated abatement of greenhouse gases including methane.
182	182	153 “Geothermal district heating”, the utilization of useful thermal energy generated and
183	183	154stored in the earth to provide heat to buildings and industry through a distribution network.
184	184	155 “Natural gas utility”, a natural gas local distribution company.
185	185	156 “Obligated entity", a person or entity that sells natural gas to end-use customers.
186	186	157 “Qualified investment”, any capital investment in gas delivery infrastructure or
187	187	158renewable thermal infrastructure incurred by a natural gas utility for the purpose of providing
188	188	159natural gas service or useful thermal energy from a renewable thermal resource while complying
189	189	160with the renewable heating standard. Qualified investments include costs of procurement of 9 of 17
190	190	161qualified renewable heating fuels or useful thermal energy from a renewable thermal resource
191	191	162from third parties that contribute to the obligated entity meeting the targets set forth in this
192	192	163chapter. Qualified investments for qualified renewable heating fuels also include (i) a facility or
193	193	164any part of the equipment located at a facility that is used to create, gather and process biogas
194	194	165into renewable natural gas; inject renewable natural gas into an existing natural gas pipeline; or
195	195	166determine the constituents of renewable natural gas before the injection of the renewable natural
196	196	167gas into an existing natural gas pipeline; or (ii) a facility or part of equipment located at a facility
197	197	168that is used to create, gather, methane or inject renewable hydrogen into an existing natural gas
198	198	169pipeline.
199	199	170 “Qualified renewable heating fuels”, renewable natural gas, renewable hydrogen, and
200	200	171renewable propane.
201	201	172 “Renewable heating standard” or “standard”, the required percentage reduction in carbon
202	202	173intensity described in subsection (a) of section 2.
203	203	174 “Renewable hydrogen”, hydrogen produced with electricity generated from renewable
204	204	175energy systems. Renewable energy systems include those that generate electric or thermal energy
205	205	176through the use of solar thermal, photovoltaics, wind, hydroelectric, geothermal electric,
206	206	177geothermal ground source heat, biogas produced by the anaerobic digestion or fermentation of
207	207	178biodegradable materials, tidal energy, wave energy, ocean thermal and fuel cells that do not
208	208	179utilize a fossil fuel resource.
209	209	180 “Renewable natural gas”, pipeline quality gas derived from any combination of biogas,
210	210	181biomass, the methanation of hydrogen and waste carbon dioxide, or the thermal gasification of 10 of 17
211	211	182sustainable feedstocks,where the use of the fuel results in lower lifecycle greenhouse gas
212	212	183emissions than geologic natural gas.
213	213	184 “Renewable propane” derived from any combination of the creation of renewable liquid
214	214	185fuels and biogases, plant materials, cellulosic and anerobic digestion processes, and future
215	215	186innovative blends or other recycled material processes, where the use of the fuel results in lower
216	216	187lifecycle greenhouse gas emissions than geologic propane.
217	217	188 “Renewable thermal district heating”, district heating relying primarily on useful thermal
218	218	189energy from a renewable thermal resource.
219	219	190 “Renewable thermal infrastructure”, infrastructure for the conversion or distribution of
220	220	191thermal energy from a renewable thermal resource.
221	221	192 “Renewable thermal resource”, any facility that generates useful thermal energy using:
222	222	193(i)  naturally occurring temperature differences in ground, air or water, via geothermal ground
223	223	194loop, ambient water loop, air source heat pump or other technology; (ii) excess thermal energy,
224	224	195also referred to as waste heat, from building energy systems or commercial processes; (iii)
225	225	196sunlight; (iv) combined heat and power; or (v) energy efficient steam technology.
226	226	197 “Useful thermal energy”, (i) energy in the form of direct heat, steam, hot water or another
227	227	198thermal form that is used in production for which fuel or electricity would otherwise be
228	228	199consumed; and (ii) beneficial measures for heating, cooling, humidity control, process use or
229	229	200other valid thermal end use energy requirements for which fuel or electricity would otherwise be
230	230	201consumed. 11 of 17
231	231	202 Section 2. (a) Beginning in compliance year 2027, each obligated entity shall reduce the
232	232	203carbon intensity of gas delivered or transported annually by the obligated entity in the
233	233	204Commonwealth by at least 2 percent. Beginning in compliance year 2030, each obligated entity
234	234	205shall reduce the carbon intensity of gas delivered or transported annually by the obligated entity
235	235	206in the Commonwealth by at least 7.5 percent. Beginning in compliance year 2035, each obligated
236	236	207entity shall reduce the carbon intensity of gas delivered or transported annually by the obligated
237	237	208entity in the Commonwealth by at least 20 percent, continuing thereafter.
238	238	209 (b) If the department determines that achievement of the renewable heating standards has
239	239	210adversely impacted the affordability of gas LDC customer bills, the department may temporarily
240	240	211suspend compliance for the next compliance year immediately following the determination.
241	241	212 (c) The department shall review whether adjustments to the renewable heating standards
242	242	213for the following 2 compliance years are necessary to ensure that the increase in customer bills
243	243	214remains affordable. This review shall assess the total incremental annual cost to meet the
244	244	215renewable heating standards, including accounting for (i) any value received by a natural gas
245	245	216utility upon any resale of eligible resources, such as any environmental credits or other credits
246	246	217associated with environmental attributes; and (ii) any savings achieved through avoidance of
247	247	218conventional gas purchases or development, such as avoided pipeline costs or carbon costs.
248	248	219 (d) The department may adjust prospective compliance year targets described in
249	249	220subsection (a); provided, however, that the cumulative annual percentage of natural gas sold
250	250	221shall comply with the 2035 target.
251	251	222 (e) If the department determines that there are not enough eligible resources to meet the
252	252	223targets identified in subsection (a) within the constraints of subsections (b) to (d), inclusive, the 12 of 17
253	253	224department may recommend natural gas utilities develop qualified investments sufficient to meet
254	254	225the targets.
255	255	226 (f) The department shall ensure that the reductions in carbon intensity in subsection (a)
256	256	227are consistent with Section 3A of Chapter 21N.
257	257	228 Section 3. (a) Compliance of an obligated entity with the renewable heating standard may
258	258	229be demonstrated through: (i) sale of qualified renewable heating fuels or useful thermal energy
259	259	230from a renewable thermal resource and their associated environmental attributes to customers in
260	260	231Massachusetts;(ii) procurement of environmental attributes by obligated entities representing
261	261	232qualified GHG emissions reductions in a system of record designated by the department (iii)
262	262	233payment of alternative compliance payments to the renewable heating solutions development
263	263	234fund established in section 2PPPPP of chapter 29; or (iv) any combination of qualified renewable
264	264	235heating fuel procurement, renewable thermal resource procurement, environmental attribute
265	265	236procurement, or alternative compliance payments.. The commissioner shall promulgate rules and
266	266	237regulations for the payment of alternative compliance payments.
267	267	238 (b) To procure environmental attributes an obligated entity’s production source shall be
268	268	239certified by the department as using eligible resources. Use of eligible resources shall be
269	269	240evidenced by reports issued by the commissioner of energy resources.
270	270	241 (c) In meeting the obligations of the renewable heating standards, to the extent feasible
271	271	242and consistent with state and federal law, all investments, projects and activities undertaken
272	272	243pursuant to this chapter by any person or the department shall provide employment opportunities
273	273	244for all segments of the population and workforce, including minority-owned and female-owned
274	274	245business enterprises, and utilize labor and materials within the commonwealth to ensure the 13 of 17
275	275	246environmental benefits of avoided carbon emissions are not diminished by emissions associated
276	276	247with the transportation of labor or materials. The investments, projects and activities shall not
277	277	248discriminate based on race or socioeconomic status.
278	278	249 (d) The commissioner of energy resources shall promulgate rules and regulations for the
279	279	250implementation of the renewable heating standards on or before July 1, 2025. The rules and
280	280	251regulations shall include, but be limited to, provisions for:
281	281	252 (i) verification of eligibility and production of eligible resources, as well as the energy
282	282	253content of qualified renewable heating fuels and useful thermal energy from a renewable thermal
283	283	254resource, including requirements to notify the department in the event of a change in status,
284	284	255monitor qualified facilities to ensure annual average energy content matches the expected
285	285	256generation of environmental attributes;
286	286	257 (ii) certification of eligible resources by issuing statements of qualification within 90 days
287	287	258of application, including prospective reviews for applicants seeking to determine whether a
288	288	259facility would be eligible;
289	289	260 (iii) annual compliance filings to be made by all obligated entities within 1 month after
290	290	261tracking system data is available for the fourth quarter of each calendar year; provided, that all
291	291	262obligated entities shall cooperate with the department in providing data necessary to assess the
292	292	263magnitude of obligation and verify the compliance of all obligated entities;
293	293	264 (iv) sanctions for obligated entities that, after investigation, have been found to fail to
294	294	265reasonably comply with the renewable heating standards or department rules and regulations;
295	295	266provided, that no sanction or penalty shall relieve or diminish an obligated entity from liability
296	296	267for fulfilling any shortfall in its compliance obligation; provided further, that no sanction shall be 14 of 17
297	297	268imposed if compliance is achieved through alternative compliance payments; provided further,
298	298	269that the department may suspend or revoke the certification of eligible resources that provide
299	299	270false information or fail to notify the department in the event of a change in eligibility status or
300	300	271otherwise comply with department rules; and provided further, that financial penalties resulting
301	301	272from sanctions from obligated entities shall not be recoverable in rates;
302	302	273 (v) mechanisms for the purposes of easing compliance burdens, facilitating bringing new
303	303	274eligible resources on-line and avoiding or mitigating conflicts with state-level source disclosure
304	304	275requirements and green marketing claims throughout the region; provided, that mechanisms shall
305	305	276allow obligated entities to demonstrate compliance over a compliance year and bank excess
306	306	277compliance for 2 subsequent compliance years, capped at 20 percent of the current year's
307	307	278obligation; and
308	308	279 (vi) public reporting on the status of the implementation of standards, including the
309	309	280comparative use of environmental attributes and alternative compliance payments and the
310	310	281amount of rate increases authorized by the standards.
311	311	282 Section 4. The commission shall adopt regulations authorizing cost recovery by natural
312	312	283gas local distribution companies of all prudent incremental costs arising from the implementation
313	313	284of the renewable heating standards, including, without limitation: (i) the purchase of qualified
314	314	285renewable heating fuels or useful thermal energy from renewable thermal resources or
315	315	286environmental attributes or the payment of alternative compliance payments; (ii) required
316	316	287payments to support assessments for compliance purposes; (iii) the incremental costs of
317	317	288complying with energy source disclosure requirements; (iv) qualified infrastructure investments
318	318	289or other activities that will grow the supply and utilization of qualified renewable heating fuels 15 of 17
319	319	290and useful thermal energy from renewable thermal resources and provide environmental benefits
320	320	291to the commonwealth, including approval of investment in conditioning, injection and
321	321	292distribution infrastructure, such as extending the transmission or distribution system for the
322	322	293purpose of interconnection with a qualified facility; (v) making a financial investment for the
323	323	294purposes of interconnecting a qualified facility or otherwise ensuring  that gas created by the
324	324	295facility can be delivered to customers in accordance with statutory  requirements for injection,
325	325	296compression, quality, and safety or other department or federal regulatory requirements; (vi)
326	326	297participating in a state or federal renewable energy program or project, if participation by the
327	327	298natural gas local distribution company (1) consists of the purchase or sale of gas produced or
328	328	299environmental attributes and (2) results in a reduction of the cost of gas produced to the
329	329	300company’s customers; (vii) providing customers with the option to purchase gas produced from a
330	330	301qualified investment, with or without environmental attributes, directly from the natural gas local
331	331	302distribution company; (viii) any other activity that develops qualified renewable heating fuel
332	332	303sources or renewable thermal resources, advances the sale of qualified renewable heating fuel
333	333	304sources or renewable thermal resources, or promotes the diversification in energy supply within
334	334	305the commonwealth to advance the commonwealth’s environmental or climate goals; and (ix)
335	335	306geothermal district heating investments. Costs may be recovered by means of an automatic
336	336	307adjustment clause or any other recovery mechanism authorized by rule. Costs incurred from
337	337	308clause ix may be recovered from customers receiving heating and cooling services as a result of
338	338	309said investment, or from gas delivery customers, until such time as a class of geothermal district
339	339	310heating customers can be established by the commission. Once a class of geothermal district
340	340	311heating customers has been established, the commission shall investigate the appropriate cost 16 of 17
341	341	312allocation and recovery of any geothermal district heating investments made prior to the
342	342	313establishment of the class.
343	343	314 Section 5. The department shall conduct a qualified renewable heating fuels inventory,
344	344	315which shall include:
345	345	316 (i) a list of the existing eligible resources, including the location, an estimate of lifecycle
346	346	317greenhouse gas emissions and an assessment of supply chain infrastructure associated with each
347	347	318eligible resource;
348	348	319 (ii) a list of the potential qualified renewable heating fuel sources, including the estimated
349	349	320potential production quantities and energy content of sources;
350	350	321 (iii) discussion of the best use or uses for potential qualified renewable heating fuel
351	351	322sources, taking into account estimated lifecycle greenhouse gas emissions, costs and whether the
352	352	323potential source can be used to address local gas or electric constraints; and
353	353	324 (iv) a description of the technologies available for use at each potential qualified
354	354	325renewable heating fuel source, including estimates from qualified renewable heating fuel
355	355	326sources, small renewable energy generating facilities, as defined in section 143 of chapter 164,
356	356	327renewable energy facilities that would be otherwise curtailed, or renewable energy generating
357	357	328sources, as defined in subsection (b) of section 11F of chapter 25A,
358	358	329 Section 6. The department shall research and determine gas quality standards for the
359	359	330injection of renewable natural gas, renewable hydrogen and any other resources qualifying for
360	360	331the renewable heating standards into the common carrier pipeline system. The purpose of the
361	361	332standards shall be to identify acceptable levels of constituents of concern for safety and 17 of 17
362	362	333environmental purposes, including ensuring pipeline integrity, while providing reasonable and
363	363	334predictable access to pipeline transmission and distribution facilities. The department shall
364	364	335consult industry groups and neighboring jurisdictions, and identify industry best practices in
365	365	336establishing the standards.
366	366	337 Section 7. The department may review and approve siting of renewable hydrogen
367	367	338production and delivery facilities and infrastructure.
368	368	339 SECTION 6. The credit established in subsection (y) of section 6 of chapter 62 shall be
369	369	340available in tax years 2024, 2025, 2026, 2027, and 2028.
370	370	341 SECTION 7. The gas quality standards established in section 6 of chapter 164C shall take
371	371	342effect not later than July 1, 2025.