EXPLANATION: CAPITALS INDICATE MAT TER ADDED TO EXISTIN G LAW.
[Brackets] indicate matter deleted from existing law.
*hb1273*
HOUSE BILL 1273
M5 5lr0063
CF 5lr0064
By: Chair, Economic Matters Committee (By Request – Departmental – Maryland
Energy Administration)
Introduced and read first time: February 7, 2025
Assigned to: Economic Matters and Environment and Transportation
A BILL ENTITLED
AN ACT concerning 1
Maryland Strategic Energy Investment Fund and Customer–Sited Solar 2
Program – Alterations 3
FOR the purpose of authorizing the use of the Maryland Strategic Energy Investment Fund 4
for certain grants and loans; altering the allowed uses of the Regional Greenhouse 5
Gas Initiative auction revenue and certain compliance fee revenue; altering certain 6
reporting requirements for the Fund; altering the definition of “low to moderate 7
income” for purposes of the Customer–Sited Solar Program; and generally relating 8
to the Maryland Strategic Energy Investment Fund and the Customer–Sited Solar 9
Program. 10
BY repealing and reenacting, without amendments, 11
Article – State Government 12
Section 9–2016(a)(1) and (b) 13
Annotated Code of Maryland 14
(2021 Replacement Volume and 2024 Supplement) 15
BY repealing and reenacting, with amendments, 16
Article – State Government 17
Section 9–2016(a)(3), 9–20B–05, and 9–20B–12 18
Annotated Code of Maryland 19
(2021 Replacement Volume and 2024 Supplement) 20
SECTION 1. BE IT ENACTED BY THE GENERAL ASSEMBLY OF MARYLAND, 21
That the Laws of Maryland read as follows: 22
Article – State Government 23
9–2016. 24
2 HOUSE BILL 1273
(a) (1) In this section the following words have the meanings indicated. 1
(3) “Low to moderate income” means a household with an annual 2
household income at or below 150% of the [average] AREA median income [for the State]. 3
(b) There is a Customer–Sited Solar Program in the Administration. 4
9–20B–05. 5
(a) IN THIS SECTION , “HOUSEHOLDS WITH LOW TO MODERATE INCO ME” 6
MEANS A HOUSEHOLD WI TH AN ANNUAL HOUSEHO LD INCOME AT OR BELO W 150% 7
OF THE AREA MEDIAN I NCOME. 8
(A–1) There is a Maryland Strategic Energy Investment Fund. 9
(b) The purpose of the Fund is to implement the Strategic Energy Investment 10
Program. 11
(c) The Administration shall administer the Fund. 12
(d) (1) The Fund is a special, nonlapsing fund that is not subject to § 7–302 of 13
the State Finance and Procurement Article. 14
(2) The Treasurer shall hold the Fund separately and the Comptroller shall 15
account for the Fund. 16
(e) The Fund consists of: 17
(1) all of the proceeds from the sale of allowances under § 2–1002(g) of the 18
Environment Article; 19
(2) money appropriated in the State budget to the Program; 20
(3) repayments and prepayments of principal and interest on loans made 21
from the Fund; 22
(4) interest and investment earnings on the Fund; 23
(5) compliance fees paid under § 7–705 of the Public Utilities Article; 24
(6) money received from any public or private source for the benefit of the 25
Fund; 26
(7) money transferred from the Public Service Commission under § 27
7–207.2(c)(3) of the Public Utilities Article; and 28
(8) money distributed under § 2–614.1 of the Tax – General Article. 29 HOUSE BILL 1273 3
(f) The Administration shall use the Fund: 1
(1) to invest in the promotion, development, and implementation of: 2
(i) cost–effective energy efficiency and conservation programs, 3
projects, or activities, including measurement and verification of energy savings; 4
(ii) renewable and clean energy resources; 5
(iii) climate change programs directly related to reducing or 6
mitigating the effects of climate change; and 7
(iv) demand response programs that are designed to promote 8
changes in electric usage by customers in response to: 9
1. changes in the price of electricity over time; or 10
2. incentives designed to induce lower electricity use at times 11
of high wholesale market prices or when system reliability is jeopardized; 12
(2) to provide targeted programs, projects, activities, and investments to 13
reduce electricity consumption by customers in the low–income and moderate–income 14
residential sectors; 15
(3) to provide supplemental funds for low–income energy assistance 16
through the Electric Universal Service Program established under § 7–512.1 of the Public 17
Utilities Article and other electric assistance programs in the Department of Human 18
Services; 19
(4) to provide rate relief by offsetting electricity rates of residential 20
customers, including an offset of surcharges imposed on ratepayers under Title 7, Subtitle 21
2, Part II of the Public Utilities Article; 22
(5) to provide grants, loans, and other assistance and investment as 23
necessary and appropriate to implement the purposes of the Program as set forth in § 24
9–20B–03 of this subtitle; 25
(6) to implement energy–related public education and outreach initiatives 26
regarding reducing energy consumption and greenhouse gas emissions; 27
(7) to provide rebates under the Electric Vehicle Recharging Equipment 28
Rebate Program established under § 9–2009 of this title; 29
(8) to provide grants to encourage combined heat and power projects at 30
industrial facilities; 31
4 HOUSE BILL 1273
(9) to provide at least $1,200,000 in each fiscal year for fiscal year 2025 1
through fiscal year 2028 to the Climate Technology Founder’s Fund established under § 2
10–858 of the Economic Development Article; 3
(10) subject to subsection (f–2) of this section, to provide at least $2,100,000 4
in funding each fiscal year to the Maryland Energy Innovation Fund established under § 5
10–835 of the Economic Development Article; 6
(11) to provide at least $500,000 each year to the Resiliency Hub Grant 7
Program Fund under § 9–2011 of this title; 8
(12) to provide grants through the Customer–Sited Solar Program under § 9
9–2016 of this title; [and] 10
(13) TO PROVIDE LOANS AND GRANTS FOR BUILDING 11
ELECTRIFICATION AND TRANSPORTATION ELECT RIFICATION; AND 12
(14) to pay the expenses of the Program. 13
(f–1) (1) Any funding provided under subsection (f)(9) of this section that is not 14
spent in a given fiscal year shall revert to the Fund in the following fiscal year. 15
(2) The Administration may provide additional funding for the purposes 16
stated in subsection (f)(9) of this section. 17
(f–2) Of the funds transferred to the Maryland Energy Innovation Fund under 18
subsection (f)(10) of this section: 19
(1) at least $1,200,000 may be used to fund the Maryland Clean Energy 20
Center established under § 10–806 of the Economic Development Article; and 21
(2) at least $900,000 may be used to fund the Maryland Energy Innovation 22
Institute established under § 10–829 of the Economic Development Article. 23
(g) Proceeds received by the Fund from the sale of allowances under § 2–1002(g) 24
of the Environment Article shall be allocated as follows: 25
(1) at least 50% shall be credited to an energy assistance account to be used 26
for the Electric Universal Service Program and other electricity assistance programs in the 27
Department of Human Services; 28
(2) at least 20% shall be credited to a low and moderate income 29
ELECTRIFICATION , efficiency, and conservation programs account and to a general 30
ELECTRIFICATION , efficiency, and conservation programs account for 31
ELECTRIFICATION , energy efficiency, and conservation programs, projects, or activities 32 HOUSE BILL 1273 5
and demand response programs, of which at least one–half shall be targeted to the low and 1
moderate income ELECTRIFICATION , efficiency, and conservation programs account for: 2
(i) the low–income residential sector at no cost to the participants 3
of the programs, projects, or activities; and 4
(ii) the moderate–income residential sector; 5
(3) at least 20% shall be credited to a renewable and clean energy programs 6
account for: 7
(i) renewable and clean energy programs and initiatives; 8
(ii) energy–related public education and outreach; and 9
(iii) climate change and resiliency programs; and 10
(4) up to 10%, but not more than $7,500,000, shall be credited to an 11
administrative expense account for costs related to the administration of the Fund, 12
including the review of electric company plans for achieving electricity savings and demand 13
reductions that the electric companies are required under law to submit to the 14
Administration. 15
(g–1) Proceeds received by the Fund from compliance fees under § 7–705(b)(2)(i)2 of 16
the Public Utilities Article shall be allocated as follows: 17
(1) beginning in fiscal year 2025, at least 20% of the proceeds shall be used 18
to provide grants to support the installation of new solar energy generating systems under 19
the Customer–Sited Solar Program; 20
(2) up to 10% of the proceeds shall be credited to an administrative expense 21
account for costs related to the administration of the Fund; 22
(3) proceeds collected but unused from a previous year shall be used before 23
proceeds allocated for the current year; and 24
(4) the Administration shall reallocate to other authorized uses any 25
proceeds that are not used within 3 fiscal years after collection. 26
(h) (1) [Energy] ELECTRIFICATION , ENERGY efficiency, and conservation 27
programs under subsection (g)(2) of this section include: 28
(i) low–income energy efficiency programs; 29
(ii) residential and small business energy efficiency programs; 30
(iii) commercial and industrial energy efficiency programs; 31 6 HOUSE BILL 1273
(iv) State and local energy efficiency programs; 1
(v) demand response programs; 2
(vi) loan programs and alternative financing mechanisms; and 3
(vii) grants to training funds and other organizations supporting job 4
training for deployment of energy efficiency and energy conservation technology and 5
equipment. 6
(2) Energy–related public education and outreach and renewable and clean 7
energy programs and initiatives under subsection (g)(3)(i) and (ii) of this section include: 8
(i) production incentives for specified renewable energy sources; 9
(ii) expansion of existing grant programs for solar, geothermal, and 10
wind programs; 11
(iii) loan programs and alternative financing mechanisms; and 12
(iv) consumer education and outreach programs that are designed to 13
reach low–income communities. 14
(i) (1) Except as provided in paragraph (2) of this subsection, compliance fees 15
paid under § 7–705(b) of the Public Utilities Article may be used only to make loans and 16
grants to support the creation of new Tier 1 renewable energy sources in the State that are 17
owned by or directly benefit: 18
(i) low– to moderate–income communities located in a census tract 19
with [an average] A median income at or below 80% of the [average] median income for the 20
State; [or] 21
(ii) overburdened or underserved communities, as defined in § 1–701 22
of the Environment Article; OR 23
(III) HOUSEHOLDS WITH LOW TO MODERATE INCOME . 24
(2) Compliance fees paid under § 7–705(b)(2)(i)2 of the Public Utilities 25
Article shall be accounted for separately within the Fund and may be used only to make 26
loans and grants to support the creation of new solar energy sources in the State that are 27
owned by or directly benefit: 28
(i) low– to moderate–income communities located in a census tract 29
with [an average] A median income at or below 80% of the [average] median income for the 30
State; 31
HOUSE BILL 1273 7
(ii) overburdened or underserved communities, as defined in § 1–701 1
of the Environment Article; or 2
(iii) households with low to moderate income[, as defined in § 9–2016 3
of this title]. 4
[(i–1) (1) (i) In this subsection the following words have the meanings 5
indicated. 6
(ii) “Area median income” has the meaning stated in § 4–1801 of the 7
Housing and Community Development Article. 8
(iii) “Low and moderate income” means having an annual household 9
income that is at or below 120% of the area median income. 10
(2)] (3) Compliance fees paid under § 7–705(b–1) of the Public Utilities 11
Article shall be accounted for separately within the Fund and may be used only to make 12
loans and grants to promote increased opportunities for the growth and development of 13
small, minority, women–owned, and veteran–owned businesses in the State that install 14
geothermal systems in the State. 15
(j) (1) The Treasurer shall invest the money of the Fund in the same manner 16
as other State money may be invested. 17
(2) Any investment earnings of the Fund shall be paid into the Fund. 18
(3) Any repayment of principal and interest on loans made from the Fund 19
shall be paid into the Fund. 20
(4) Balances in the Fund shall be held for the benefit of the Program, shall 21
be expended solely for the purposes of the Program, and may not be used for the general 22
obligations of government. 23
(k) Expenditures from the Fund shall be made by: 24
(1) an appropriation in the annual State budget; or 25
(2) a budget amendment in accordance with § 7–209 of the State Finance 26
and Procurement Article. 27
(l) An expenditure by budget amendment may be made under subsection (k) of 28
this section only after: 29
(1) the Administration has submitted the proposed budget amendment and 30
supporting documentation to the Senate Budget and Taxation Committee, Senate 31
Education, Energy, and the Environment Committee, House Appropriations Committee, 32
and House Economic Matters Committee; and 33 8 HOUSE BILL 1273
(2) the committees have had 45 days for review and comment. 1
(m) (1) A loan or grant made available from the Fund to a unit of State or local 2
government shall comply with §§ 14–416 and 17–303 of the State Finance and Procurement 3
Article. 4
(2) At least 80% of workers participating in a project or program that 5
receives money from the Fund must reside within 50 miles of the project or program, or 6
another distance defined by the local jurisdiction where the project or program is located. 7
9–20B–12. 8
(a) On or before January 1 each year, the Administration shall report to the 9
Governor, to the Board, and, in accordance with § 2–1257 of this article, to the General 10
Assembly and the members of the Senate Finance Committee and the House Economic 11
Matters Committee on the uses and expenditures of the Fund from the prior fiscal year. 12
(b) The report shall include: 13
(1) a detailed accounting of all amounts IN EXCESS OF $10,000 received 14
by and disbursed from the Fund, including the amount and recipient of each grant awarded 15
by the Administration[, and identifying multiple grants awarded to the same person or the 16
same address]; 17
(2) all amounts used by the Administration for administrative purposes, 18
including the funding source from which each amount was obtained; 19
(3) programs, projects, and activities included in each category under § 20
9–20B–05(g) of this subtitle; 21
(4) the status of programs, projects, activities, and investments 22
implemented with funds from the Fund, including an evaluation of the impact of the 23
programs, projects, activities, and investments that are directed to low–income or 24
moderate–income residential sectors or to other particular classes of ratepayers; 25
(5) an estimate of [electricity] GREENHOUSE GAS savings from the 26
programs, projects, activities, and investments; 27
(6) the number of allowances sold in each auction; 28
(7) the average allowance price from each auction; 29
(8) an estimate of revenue from future auctions; 30
HOUSE BILL 1273 9
(9) an accounting of all amounts received or disbursed by the Fund from 1
all other sources, including money received in accordance with orders issued and settlement 2
agreements approved by the Public Service Commission; 3
(10) recommendations for changes to the allocation of funds under § 4
9–20B–05(g) of this subtitle; 5
(11) the status of programs and expenditures in the current fiscal year; and 6
(12) possible or expected program initiatives and changes in later years. 7
SECTION 2. AND BE IT FURTHER ENACTED, Th at this Act shall take effect July 8
1, 2025. 9