| 1 | 1 | | BILL AS INTRODUCED H.196 |
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| 5 | 5 | | VT LEG #380503 v.1 |
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| 6 | 6 | | H.196 1 |
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| 7 | 7 | | Introduced by Representative Logan of Burlington 2 |
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| 8 | 8 | | Referred to Committee on 3 |
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| 9 | 9 | | Date: 4 |
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| 10 | 10 | | Subject: Public service; energy; energy efficiency; energy efficiency utilities 5 |
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| 11 | 11 | | Statement of purpose of bill as introduced: This bill proposes to amend the 6 |
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| 12 | 12 | | legislative direction to the Public Utility Commission to require the energy 7 |
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| 13 | 13 | | efficiency utilities to prioritize greenhouse gas emissions reductions and 8 |
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| 14 | 14 | | equitable access for all Vermonters and Vermont businesses 9 |
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| 15 | 15 | | An act relating to energy efficiency utility jurisdiction 10 |
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| 16 | 16 | | It is hereby enacted by the General Assembly of the State of Vermont: 11 |
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| 17 | 17 | | Sec. 1. 30 V.S.A. § 209 is amended to read: 12 |
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| 18 | 18 | | § 209. JURISDICTION; GENERAL SCOPE 13 |
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| 19 | 19 | | * * * 14 |
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| 20 | 20 | | (d) Energy efficiency and emissions reduction. 15 |
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| 21 | 21 | | (1) Programs and measures. The Department of Public Service, any 16 |
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| 22 | 22 | | entity appointed by the Commission under subdivision (2) of this subsection, 17 |
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| 23 | 23 | | all gas and electric utility companies, and the Commission upon its own 18 |
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| 24 | 24 | | motion are encouraged to propose, develop, solicit, and monitor energy 19 |
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| 25 | 25 | | efficiency and conservation programs and measures, including electrification, 20 BILL AS INTRODUCED H.196 |
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| 26 | 26 | | 2025 Page 2 of 18 |
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| 28 | 28 | | |
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| 29 | 29 | | VT LEG #380503 v.1 |
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| 30 | 30 | | energy storage, and appropriate combined heat and power systems that result 1 |
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| 31 | 31 | | in the conservation and efficient use of energy. and Any programs and 2 |
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| 32 | 32 | | measures supporting efficient use of biological and fossil-based fuels shall 3 |
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| 33 | 33 | | meet the applicable air quality standards of the Agency of Natural Resources. 4 |
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| 34 | 34 | | Such programs and measures, and their implementation, may be approved by 5 |
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| 35 | 35 | | the Commission if it determines they will be beneficial to towards the 6 |
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| 36 | 36 | | reduction of greenhouse gas emissions required under 10 V.S.A. § 578 and 7 |
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| 37 | 37 | | beneficial to consumers or the ratepayers of the companies after such notice 8 |
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| 38 | 38 | | and hearings as the Commission may require by order or by rule. The 9 |
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| 39 | 39 | | Department of Public Service shall investigate the feasibility of enhancing and 10 |
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| 40 | 40 | | expanding the efficiency programs of gas utilities and shall make any 11 |
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| 41 | 41 | | appropriate proposals to the Commission. 12 |
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| 42 | 42 | | (2) Appointment of independent efficiency entities. 13 |
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| 43 | 43 | | (A) Electricity and natural gas. In place of utility-specific programs 14 |
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| 44 | 44 | | developed pursuant to this section and section 218c of this title, the 15 |
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| 45 | 45 | | Commission shall, after notice and opportunity for hearing, provide for the 16 |
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| 46 | 46 | | development, implementation, and monitoring of gas and electric energy 17 |
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| 47 | 47 | | efficiency, and conservation, electrification, active demand management, and 18 |
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| 48 | 48 | | energy storage programs and measures, including programs and measures 19 |
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| 49 | 49 | | delivered in multiple service territories, by one or more entities appointed by 20 |
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| 50 | 50 | | the Commission for these purposes. The Commission may include appropriate 21 BILL AS INTRODUCED H.196 |
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| 51 | 51 | | 2025 Page 3 of 18 |
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| 52 | 52 | | |
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| 53 | 53 | | |
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| 54 | 54 | | VT LEG #380503 v.1 |
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| 55 | 55 | | combined heat and power systems that result in the conservation and efficient 1 |
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| 56 | 56 | | use of energy and meet the applicable air quality standards of the Agency of 2 |
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| 57 | 57 | | Natural Resources. Except with regard to a transmission company, the 3 |
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| 58 | 58 | | Commission may specify that the appointment of an energy efficiency utility to 4 |
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| 59 | 59 | | deliver services within an electric utility’s service territory satisfies that 5 |
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| 60 | 60 | | electric utility’s corresponding obligations, in whole or in part, under section 6 |
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| 61 | 61 | | 218c of this title and under any prior orders of the Commission. 7 |
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| 62 | 62 | | (B) Thermal energy and process-fuel customers. The Commission 8 |
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| 63 | 63 | | shall provide for the coordinated development, implementation, and 9 |
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| 64 | 64 | | monitoring of cost-effective efficiency and conservation programs to thermal 10 |
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| 65 | 65 | | energy and process-fuel customers on a whole buildings basis by one or more 11 |
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| 66 | 66 | | entities appointed by the Commission for this purpose. 12 |
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| 67 | 67 | | (i) In this section, “thermal energy” means the use of fuels to 13 |
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| 68 | 68 | | control the temperature of space within buildings and to heat water. In this 14 |
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| 69 | 69 | | section, “process fuel” means fuel used in commercial and industrial 15 |
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| 70 | 70 | | production operations. 16 |
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| 71 | 71 | | (ii) Periodically on a schedule directed by the Commission, the 17 |
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| 72 | 72 | | appointed entity or entities shall propose to the Commission a plan to 18 |
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| 73 | 73 | | implement this subdivision (d)(2)(B). The proposed plan shall comply with 19 |
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| 74 | 74 | | subsections (e)–(g) of this section and shall be subject to the Commission’s 20 |
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| 75 | 75 | | approval. The Commission shall not conduct the review of the proposed plan 21 BILL AS INTRODUCED H.196 |
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| 78 | 78 | | |
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| 79 | 79 | | VT LEG #380503 v.1 |
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| 80 | 80 | | as a contested case under 3 V.S.A. chapter 25 but shall provide notice and an 1 |
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| 81 | 81 | | opportunity for written and oral comments to the public and affected parties 2 |
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| 82 | 82 | | and State agencies. 3 |
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| 83 | 83 | | (C) The appointed entity may be used to support the attainment of 4 |
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| 84 | 84 | | building energy codes established pursuant to sections 51 and 53 of this title. 5 |
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| 85 | 85 | | The Commission shall review and approve a methodology for the appointed 6 |
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| 86 | 86 | | entities to support the attainment of code in the next Demand Resources Plan 7 |
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| 87 | 87 | | Proceeding. The Commission is authorized to approve a methodology for the 8 |
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| 88 | 88 | | appointed entity and the State to quantify energy savings achieved through 9 |
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| 89 | 89 | | code attainment, which shall be counted toward the appointed entity’s 10 |
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| 90 | 90 | | quantitative savings targets. 11 |
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| 91 | 91 | | (D) The appointed entity shall receive a total annual budget from 12 |
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| 92 | 92 | | 2027 through 2030 that is equivalent to the inflation-adjusted Commission-13 |
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| 93 | 93 | | approved budget in 2026. 14 |
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| 94 | 94 | | (3) Energy efficiency charge; regulated fuels. In addition to its existing 15 |
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| 95 | 95 | | authority, the Commission may establish by order or rule a volumetric charge 16 |
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| 96 | 96 | | to customers for the support of energy efficiency programs that meet the 17 |
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| 97 | 97 | | requirements of section 218c of this title, with priority consideration given to 18 |
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| 98 | 98 | | the greenhouse gas reduction requirements under 10 V.S.A. § 578, and due 19 |
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| 99 | 99 | | consideration to the State’s energy policy under section 202a of this title and to 20 |
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| 100 | 100 | | its energy and economic policy interests under section 218e of this title to 21 BILL AS INTRODUCED H.196 |
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| 102 | 102 | | |
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| 103 | 103 | | |
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| 104 | 104 | | VT LEG #380503 v.1 |
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| 105 | 105 | | maintain and enhance the State’s economic vitality. The charge shall be 1 |
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| 106 | 106 | | known as the energy efficiency charge, shall be shown separately on each 2 |
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| 107 | 107 | | customer’s bill, and shall be paid to a fund administrator appointed by the 3 |
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| 108 | 108 | | Commission and deposited into the Electric Efficiency Fund. When such a 4 |
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| 109 | 109 | | charge is shown, notice as to how to obtain information about energy 5 |
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| 110 | 110 | | efficiency programs approved under this section shall be provided in a manner 6 |
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| 111 | 111 | | directed by the Commission. This notice shall include, at a minimum, a toll-7 |
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| 112 | 112 | | free telephone number, and to the extent feasible shall be on the customer’s bill 8 |
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| 113 | 113 | | and near the energy efficiency charge. 9 |
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| 114 | 114 | | (4) Supplemental funding; Programs funded under this section shall also 10 |
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| 115 | 115 | | be funded without further appropriation or offsets by each of the following: 11 |
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| 116 | 116 | | (A) Net revenues above costs associated with payments from the 12 |
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| 117 | 117 | | New England Independent System Operator (ISO-NE) for capacity savings 13 |
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| 118 | 118 | | resulting from the activities of the energy efficiency utility designated under 14 |
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| 119 | 119 | | subdivision (2)(A) of this subsection (e) that are not transferred to the State 15 |
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| 120 | 120 | | PACE Reserve Fund under 24 V.S.A. § 3270(c). These revenues shall be 16 |
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| 121 | 121 | | deposited into the Efficiency Fund established by this section. 17 |
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| 122 | 122 | | (B) Net revenues above costs from the sale of carbon credits under 18 |
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| 123 | 123 | | the cap and trade program established under section 255 of this title, which 19 |
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| 124 | 124 | | shall be deposited into the Efficiency Fund established by this section. 20 BILL AS INTRODUCED H.196 |
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| 126 | 126 | | |
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| 127 | 127 | | |
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| 128 | 128 | | VT LEG #380503 v.1 |
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| 129 | 129 | | (C) Any other monies that are appropriated to or deposited in the 1 |
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| 130 | 130 | | Electric Efficiency Fund for the delivery of thermal energy and process fuel 2 |
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| 131 | 131 | | energy efficiency services. 3 |
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| 132 | 132 | | (D) Notwithstanding subsection (e) of this section, a retail electricity 4 |
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| 133 | 133 | | provider that is also an entity appointed under subdivision (d)(2)(A), may use 5 |
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| 134 | 134 | | monies subject to subsection (e) of this section and any of the Supplemental 6 |
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| 135 | 135 | | Funding outlined in this subdivision (4) to deliver thermal and transportation 7 |
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| 136 | 136 | | measures or programs that reduce fossil fuel use regardless of the preexisting 8 |
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| 137 | 137 | | fuel source of the customer with special emphasis on measures or programs 9 |
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| 138 | 138 | | that take a new or innovative approach to reducing fossil fuel use including 10 |
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| 139 | 139 | | support for staffing necessary to implement innovative building sector policies 11 |
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| 140 | 140 | | and modifying or supplementing existing vehicle incentive programs and 12 |
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| 141 | 141 | | electric vehicle supply equipment grant programs to incentivize high-13 |
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| 142 | 142 | | consumption fuel users, especially individuals using more than 1000 gallons of 14 |
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| 143 | 143 | | gasoline or diesel annually and those with low and moderate income, to 15 |
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| 144 | 144 | | transition to the use of battery electric vehicles. The amounts available shall 16 |
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| 145 | 145 | | include amounts annually budgeted for thermal energy and process fuel funds 17 |
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| 146 | 146 | | or from Supplemental Funding, and any carry-forward thermal energy and 18 |
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| 147 | 147 | | process fuel funds or Supplemental Funding from prior periods, on programs, 19 |
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| 148 | 148 | | measures, and services that reduce greenhouse gas emissions in the thermal 20 |
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| 149 | 149 | | energy or transportation sector. 21 BILL AS INTRODUCED H.196 |
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| 151 | 151 | | |
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| 152 | 152 | | |
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| 153 | 153 | | VT LEG #380503 v.1 |
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| 154 | 154 | | (A)(5) Regulated use of the Efficiency Fund. Balances in the Electric 1 |
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| 155 | 155 | | Efficiency Fund shall be ratepayer funds, shall be used to support the activities 2 |
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| 156 | 156 | | authorized in this subdivision in a fuel neutral manner, and shall be carried 3 |
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| 157 | 157 | | forward and remain in the Fund at the end of each fiscal year. These monies 4 |
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| 158 | 158 | | shall not be available to meet the general obligations of the State. Interest 5 |
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| 159 | 159 | | earned shall remain in the Fund. The Commission will annually provide the 6 |
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| 160 | 160 | | General Assembly with a report detailing the revenues collected and the 7 |
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| 161 | 161 | | expenditures made for energy efficiency programs under this section. The 8 |
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| 162 | 162 | | provisions of 2 V.S.A. § 20(d) (expiration of required reports) shall not apply 9 |
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| 163 | 163 | | to the report to be made under this subsection (d). 10 |
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| 164 | 164 | | (B)(A) The charge charges established by the Commission pursuant 11 |
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| 165 | 165 | | to this subdivision (3)(5) shall be in an amount determined by the Commission 12 |
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| 166 | 166 | | by rule or order that is consistent with the principles of least-cost integrated 13 |
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| 167 | 167 | | planning as defined in section 218c of this title are societally cost-effective for 14 |
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| 168 | 168 | | the purpose of reducing greenhouse gas emissions. As circumstances and 15 |
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| 169 | 169 | | programs evolve, the amount of the charge charges shall be reviewed for 16 |
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| 170 | 170 | | unrealized energy efficiency potential and shall be adjusted as necessary in 17 |
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| 171 | 171 | | order to realize all reasonably available, cost-effective energy efficiency 18 |
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| 172 | 172 | | savings. In setting the amount of the charge and its allocation, the Commission 19 |
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| 173 | 173 | | shall determine an appropriate balance among the following objectives; 20 |
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| 174 | 174 | | provided, however, that particular emphasis shall be accorded to the first four 21 BILL AS INTRODUCED H.196 |
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| 176 | 176 | | |
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| 177 | 177 | | |
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| 178 | 178 | | VT LEG #380503 v.1 |
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| 179 | 179 | | of these objectives: prioritize the reduction of greenhouse gases and seek to 1 |
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| 180 | 180 | | balance the other following objectives: reducing Vermont’s total energy 2 |
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| 181 | 181 | | demand, consumption, and expenditures; reducing the size of future power 3 |
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| 182 | 182 | | purchases; reducing the generation of greenhouse gases equitable distribution 4 |
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| 183 | 183 | | of benefits using geographic and economic indicators; limiting the need to 5 |
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| 184 | 184 | | upgrade the State’s transmission and distribution infrastructure; minimizing the 6 |
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| 185 | 185 | | costs of electricity; reducing Vermont’s total energy demand, consumption, 7 |
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| 186 | 186 | | and expenditures; providing efficiency and conservation as a part of a 8 |
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| 187 | 187 | | comprehensive resource supply strategy that includes implementation of 9 |
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| 188 | 188 | | beneficial electrification and energy storage system projects; providing the 10 |
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| 189 | 189 | | opportunity for all Vermonters to participate in efficiency and conservation 11 |
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| 190 | 190 | | programs; and targeting efficiency and conservation efforts to locations, 12 |
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| 191 | 191 | | markets, or customers where they may provide the greatest value. 13 |
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| 192 | 192 | | (C)(B) The Commission, by rule or order, shall establish a process by 14 |
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| 193 | 193 | | which a customer who pays an average annual energy efficiency charge under 15 |
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| 194 | 194 | | this subdivision (3)(5) of at least $5,000.00 may apply to the Commission to 16 |
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| 195 | 195 | | self-administer energy efficiency through an energy savings account or 17 |
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| 196 | 196 | | customer credit program that shall contain up to 75 percent and 90 percent, 18 |
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| 197 | 197 | | respectively of the customer’s energy efficiency charge payments as 19 |
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| 198 | 198 | | determined by the Commission. The remaining portion of the charge shall be 20 |
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| 199 | 199 | | used for administrative, measurement, verification, and evaluation costs and 21 BILL AS INTRODUCED H.196 |
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| 201 | 201 | | |
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| 202 | 202 | | |
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| 203 | 203 | | VT LEG #380503 v.1 |
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| 204 | 204 | | for systemwide energy benefits. Customer energy efficiency funds may be 1 |
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| 205 | 205 | | approved for use by the Commission for one or more of the following: electric 2 |
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| 206 | 206 | | energy efficiency projects and non-electric nonelectric efficiency projects, 3 |
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| 207 | 207 | | which may include thermal and process fuel efficiency, flexible load 4 |
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| 208 | 208 | | management, combined heat and power systems, demand management, energy 5 |
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| 209 | 209 | | productivity, and energy storage. These funds shall not be used for the 6 |
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| 210 | 210 | | purchase or installation of new equipment capable of combusting fossil fuels. 7 |
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| 211 | 211 | | The Commission in its rules or order shall establish criteria for each program 8 |
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| 212 | 212 | | and approval of these applications, establish application and enrollment 9 |
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| 213 | 213 | | periods, establish participant requirements, and establish the methodology for 10 |
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| 214 | 214 | | evaluation, measurement, and verification for programs. The total amount of 11 |
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| 215 | 215 | | customer energy efficiency funds that can be placed into energy savings 12 |
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| 216 | 216 | | accounts or the customer credit program annually is $2,000,000.00 and 13 |
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| 217 | 217 | | $1,000,000.00 respectively. 14 |
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| 218 | 218 | | (D) The Commission may authorize the use of funds raised through 15 |
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| 219 | 219 | | an energy efficiency charge on electric ratepayers to reduce the use of fossil 16 |
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| 220 | 220 | | fuels for space heating by supporting electric technologies that may increase 17 |
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| 221 | 221 | | electric consumption, such as air source or geothermal heat pumps if, after 18 |
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| 222 | 222 | | investigation, it finds that deployment of the technology: 19 |
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| 223 | 223 | | (i) will be beneficial to electric ratepayers as a whole; 20 BILL AS INTRODUCED H.196 |
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| 225 | 225 | | |
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| 226 | 226 | | |
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| 227 | 227 | | VT LEG #380503 v.1 |
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| 228 | 228 | | (ii) will result in cost-effective energy savings to the end-user and 1 |
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| 229 | 229 | | to the State as a whole; 2 |
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| 230 | 230 | | (iii) will result in a net reduction in State energy consumption and 3 |
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| 231 | 231 | | greenhouse gas emissions on a life-cycle basis and will not have a detrimental 4 |
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| 232 | 232 | | impact on the environment through other means such as release of refrigerants 5 |
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| 233 | 233 | | or disposal. In making a finding under this subdivision, the Commission shall 6 |
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| 234 | 234 | | consider the use of the technology at all times of year and any likely new 7 |
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| 235 | 235 | | electricity demand created by such use; 8 |
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| 236 | 236 | | (iv) will be part of a comprehensive energy efficiency and 9 |
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| 237 | 237 | | conservation program that meets the requirements of subsections (d)-(g) of this 10 |
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| 238 | 238 | | section and that makes support for the technology contingent on the energy 11 |
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| 239 | 239 | | performance of the building in which the technology is to be installed. The 12 |
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| 240 | 240 | | building’s energy performance shall achieve or shall be improved to achieve an 13 |
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| 241 | 241 | | energy performance level that is approved by the Commission and that is 14 |
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| 242 | 242 | | consistent with meeting or exceeding the goals of 10 V.S.A. § 581 (building 15 |
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| 243 | 243 | | efficiency); 16 |
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| 244 | 244 | | (v) among the product models of the technology that are suitable 17 |
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| 245 | 245 | | for use in Vermont, will employ the product models that are the most efficient 18 |
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| 246 | 246 | | available; 19 BILL AS INTRODUCED H.196 |
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| 249 | 249 | | |
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| 250 | 250 | | VT LEG #380503 v.1 |
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| 251 | 251 | | (vi) will be promoted in conjunction with demand management 1 |
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| 252 | 252 | | strategies offered by the customer’s distribution utility to address any increase 2 |
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| 253 | 253 | | in peak electric consumption that may be caused by the deployment; 3 |
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| 254 | 254 | | (vii) will be coordinated between the energy efficiency and 4 |
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| 255 | 255 | | distribution utilities, consistent with subdivision (f)(5) of this section; and 5 |
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| 256 | 256 | | (viii) will be supported by an appropriate allocation of funds 6 |
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| 257 | 257 | | among the funding sources described in this subsection (d) and subsection (e) 7 |
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| 258 | 258 | | of this section. In the case of measures used to increase the energy 8 |
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| 259 | 259 | | performance of a building in which the technology is to be installed, the 9 |
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| 260 | 260 | | Commission shall assume installation of the technology in the building and 10 |
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| 261 | 261 | | then determine the allocation according to the proportion of the benefits 11 |
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| 262 | 262 | | provided to the regulated fuel and unregulated fuel sectors. In this subdivision 12 |
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| 263 | 263 | | (viii), “regulated fuel” and “unregulated fuel” shall have the same meaning as 13 |
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| 264 | 264 | | under subsection (e) of this section. 14 |
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| 265 | 265 | | (4)(6) Contract or order of appointment. Appointment of an entity 15 |
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| 266 | 266 | | under subdivision (2) of this subsection may be by contract or by an order of 16 |
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| 267 | 267 | | appointment. An appointment, whether by order of appointment or by 17 |
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| 268 | 268 | | contract, may only be issued after notice and opportunity for hearing. An order 18 |
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| 269 | 269 | | of appointment shall be for a limited duration not to exceed 12 years, although 19 |
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| 270 | 270 | | an entity may be reappointed by order or contract. An order of appointment 20 |
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| 271 | 271 | | may include any conditions and requirements that the Commission deems 21 BILL AS INTRODUCED H.196 |
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| 273 | 273 | | |
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| 274 | 274 | | |
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| 275 | 275 | | VT LEG #380503 v.1 |
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| 276 | 276 | | appropriate to promote the public good. For good cause, after notice and 1 |
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| 277 | 277 | | opportunity for hearing, the Commission may amend or revoke an order of 2 |
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| 278 | 278 | | appointment. 3 |
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| 279 | 279 | | (5)(7) Appointed entity; supervision. Any entity appointed by order of 4 |
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| 280 | 280 | | appointment under subdivisions (2) and (4)(6) of this subsection that is not an 5 |
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| 281 | 281 | | electric or gas utility already regulated under this title shall not be considered 6 |
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| 282 | 282 | | to be a company as defined under section 201 of this title but shall be subject 7 |
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| 283 | 283 | | to the provisions of sections 18–21, 30–32, 205–208, subsection 209(a), 8 |
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| 284 | 284 | | sections 219, 221, and subsection 231(b) of this title, to the same extent as a 9 |
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| 285 | 285 | | company as defined under section 201 of this title. The Commission and the 10 |
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| 286 | 286 | | Department of Public Service shall have jurisdiction under those sections over 11 |
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| 287 | 287 | | the entity, its directors, receivers, trustees, lessees, or other persons or 12 |
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| 288 | 288 | | companies owning or operating the entity and of all plants, equipment, and 13 |
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| 289 | 289 | | property of that entity used in or about the business carried on by it in this 14 |
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| 290 | 290 | | State as covered and included in this section. This jurisdiction shall be 15 |
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| 291 | 291 | | exercised by the Commission and the Department so far as may be necessary 16 |
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| 292 | 292 | | to enable them to perform the duties and exercise the powers conferred upon 17 |
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| 293 | 293 | | them by law. The Commission and the Department each may, when they deem 18 |
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| 294 | 294 | | the public good requires, examine the plants, equipment, and property of any 19 |
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| 295 | 295 | | entity appointed by order of appointment under subdivisions (2) and (4) of this 20 |
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| 296 | 296 | | subsection. 21 BILL AS INTRODUCED H.196 |
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| 299 | 299 | | |
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| 300 | 300 | | VT LEG #380503 v.1 |
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| 301 | 301 | | (8) Provision of equity and justice in services; requirements. Any 1 |
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| 302 | 302 | | appointed entity shall ensure an equitable and just provision of services. 2 |
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| 303 | 303 | | (A) Not less than 25 percent of the annual budget shall be targeted 3 |
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| 304 | 304 | | for residential services for customers with low to moderate income. 4 |
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| 305 | 305 | | (B) Not less than 12.5 percent of the annual budget shall be targeted 5 |
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| 306 | 306 | | for small businesses and not-for-profit organizations. 6 |
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| 307 | 307 | | (C) The cost of providing services under this subsection (6) shall be 7 |
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| 308 | 308 | | excluded from the calculation of cost-effectiveness for the appointed entities’ 8 |
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| 309 | 309 | | portfolio of services. 9 |
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| 310 | 310 | | (D) On or before September 1, 2026, the appointed entity shall 10 |
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| 311 | 311 | | propose and the Commission shall evaluate the appropriateness of a statewide 11 |
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| 312 | 312 | | low-income energy efficiency rate for regulated fuels. The Commission may 12 |
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| 313 | 313 | | consider the technical feasibility of implementation before approving such a 13 |
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| 314 | 314 | | rate. For a distribution utility that is also an appointed entity, and has a 14 |
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| 315 | 315 | | Commission approved discounted low-income rate, that appointed entity may 15 |
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| 316 | 316 | | elect to apply its Commission approved discounted low-income rate criteria to 16 |
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| 317 | 317 | | the energy efficiency charge in lieu of adopting a statewide low-income energy 17 |
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| 318 | 318 | | efficiency rate. 18 |
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| 319 | 319 | | (e) Thermal energy and process fuel efficiency funding. 19 |
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| 320 | 320 | | (1) Each of the following shall be used to deliver thermal energy and 20 |
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| 321 | 321 | | process fuel energy efficiency services in accordance with this section for 21 BILL AS INTRODUCED H.196 |
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| 322 | 322 | | 2025 Page 14 of 18 |
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| 323 | 323 | | |
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| 324 | 324 | | |
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| 325 | 325 | | VT LEG #380503 v.1 |
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| 326 | 326 | | unregulated fuels to Vermont consumers of such fuels. In addition, the 1 |
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| 327 | 327 | | Commission may authorize an entity appointed to deliver such services under 2 |
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| 328 | 328 | | subdivision (d)(2)(B) of this section to use monies subject to this subsection 3 |
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| 329 | 329 | | for the engineering, design, and construction of facilities for the conversion of 4 |
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| 330 | 330 | | thermal energy customers using fossil fuels to district heat if the majority of 5 |
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| 331 | 331 | | the district’s energy is from biomass sources, the district’s distribution system 6 |
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| 332 | 332 | | is highly energy efficient, and such conversion is cost effective. 7 |
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| 333 | 333 | | (A) Net revenues above costs associated with payments from the New 8 |
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| 334 | 334 | | England Independent System Operator (ISO-NE) for capacity savings resulting 9 |
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| 335 | 335 | | from the activities of the energy efficiency utility designated under subdivision 10 |
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| 336 | 336 | | (2)(A) of this subsection (e) that are not transferred to the State PACE Reserve 11 |
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| 337 | 337 | | Fund under 24 V.S.A. § 3270(c). These revenues shall be deposited into the 12 |
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| 338 | 338 | | Electric Efficiency Fund established by this section. In delivering services with 13 |
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| 339 | 339 | | respect to heating systems using the revenues subject to this subdivision (A), 14 |
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| 340 | 340 | | the entity shall give priority to incentives for the installation of high efficiency 15 |
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| 341 | 341 | | biomass heating systems and shall have a goal of offering an incentive that is 16 |
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| 342 | 342 | | equal to 25 percent of the installed cost of such a system. Provision of an 17 |
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| 343 | 343 | | incentive under this subdivision (A) for a biomass heating system shall not be 18 |
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| 344 | 344 | | contingent on the making of other energy efficiency improvements at the 19 |
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| 345 | 345 | | property on which the system will be installed. 20 BILL AS INTRODUCED H.196 |
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| 346 | 346 | | 2025 Page 15 of 18 |
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| 347 | 347 | | |
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| 348 | 348 | | |
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| 349 | 349 | | VT LEG #380503 v.1 |
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| 350 | 350 | | (B) Net revenues above costs from the sale of carbon credits under the 1 |
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| 351 | 351 | | cap and trade program established under section 255 of this title, which shall 2 |
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| 352 | 352 | | be deposited into the Electric Efficiency Fund established by this section. 3 |
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| 353 | 353 | | (C) Any other monies that are appropriated to or deposited in the 4 |
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| 354 | 354 | | Electric Efficiency Fund for the delivery of thermal energy and process fuel 5 |
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| 355 | 355 | | energy efficiency services. 6 |
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| 356 | 356 | | (2) If a program combines regulated fuel efficiency services with 7 |
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| 357 | 357 | | unregulated fuel efficiency services supported by funds under this section, the 8 |
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| 358 | 358 | | Commission shall allocate the costs of the program among the funding sources 9 |
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| 359 | 359 | | for the regulated and unregulated fuel sectors in proportion to the benefits 10 |
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| 360 | 360 | | provided to each sector. 11 |
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| 361 | 361 | | (3) In this subsection: 12 |
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| 362 | 362 | | (A) “Biomass” means organic nonfossil material constituting a 13 |
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| 363 | 363 | | source of renewable energy within the meaning of section 8002 of this title. 14 |
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| 364 | 364 | | (B) “District heat” means a system through which steam or hot water 15 |
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| 365 | 365 | | from a central plant is piped into buildings to be used as a source of thermal 16 |
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| 366 | 366 | | energy. 17 |
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| 367 | 367 | | (C) “Efficiency services” includes the establishment of a statewide 18 |
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| 368 | 368 | | information clearinghouse under subsection (g) of this section. 19 BILL AS INTRODUCED H.196 |
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| 370 | 370 | | |
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| 371 | 371 | | |
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| 372 | 372 | | VT LEG #380503 v.1 |
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| 373 | 373 | | (D) “Fossil fuel” means an energy source formed in the earth’s crust 1 |
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| 374 | 374 | | from decayed organic material. The common fossil fuels are petroleum, coal, 2 |
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| 375 | 375 | | and natural gas. A fossil fuel may be a regulated or unregulated fuel. 3 |
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| 376 | 376 | | (E) “Regulated fuels” means electricity and natural gas delivered by a 4 |
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| 377 | 377 | | regulated utility. 5 |
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| 378 | 378 | | (F) “Unregulated fuels” means fuels used by thermal energy and 6 |
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| 379 | 379 | | process fuel customers other than electricity and natural gas delivered by a 7 |
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| 380 | 380 | | regulated utility. 8 |
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| 381 | 381 | | (f) Goals and criteria; all energy efficiency programs. With respect to all 9 |
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| 382 | 382 | | energy efficiency programs approved under this section, the Commission shall: 10 |
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| 383 | 383 | | (1) Ensure that all retail consumers, regardless of retail electricity, gas, 11 |
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| 384 | 384 | | or heating or process fuel provider, will have an opportunity to participate in 12 |
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| 385 | 385 | | and benefit from a comprehensive set of cost-effective energy efficiency, 13 |
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| 386 | 386 | | electrification, and energy storage programs and initiatives designed to 14 |
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| 387 | 387 | | overcome barriers to participation. 15 |
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| 388 | 388 | | (2) Require that continued or improved efficiencies be made in the 16 |
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| 389 | 389 | | production, delivery, and use of energy efficiency services, including the use 17 |
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| 390 | 390 | | of compensation mechanisms for any energy efficiency entity appointed under 18 |
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| 391 | 391 | | subdivision (d)(2) of this section that are based upon verified greenhouse gas 19 |
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| 392 | 392 | | emission reductions, savings in energy usage and demand, and other 20 |
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| 393 | 393 | | performance targets specified by the Commission. The linkage between 21 BILL AS INTRODUCED H.196 |
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| 394 | 394 | | 2025 Page 17 of 18 |
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| 395 | 395 | | |
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| 396 | 396 | | |
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| 397 | 397 | | VT LEG #380503 v.1 |
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| 398 | 398 | | compensation and verified savings in energy usage and demand (and other 1 |
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| 399 | 399 | | performance targets) shall be reviewed and adjusted not less than triennially by 2 |
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| 400 | 400 | | the Commission. 3 |
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| 401 | 401 | | * * * 4 |
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| 402 | 402 | | (g) Thermal energy and process fuel efficiency programs; additional 5 |
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| 403 | 403 | | criteria. With respect to energy efficiency programs delivered under this 6 |
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| 404 | 404 | | section to thermal energy and process fuel customers, the Commission shall: 7 |
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| 405 | 405 | | (1) Ensure that programs are delivered on a whole-buildings basis to 8 |
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| 406 | 406 | | help meet the State’s building efficiency goals established by 10 V.S.A. § 581 9 |
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| 407 | 407 | | and to reduce greenhouse gas emissions from thermal energy and process fuel 10 |
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| 408 | 408 | | use in Vermont pursuant to 10 V.S.A. § 578. 11 |
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| 409 | 409 | | (2) Require the establishment of a statewide information clearinghouse 12 |
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| 410 | 410 | | to enable effective access for customers to and effective coordination across 13 |
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| 411 | 411 | | programs. The clearinghouse shall serve as a portal for customers to access 14 |
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| 412 | 412 | | thermal energy and process fuel efficiency services and for coordination 15 |
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| 413 | 413 | | among State, regional, and local entities involved in the planning or delivery of 16 |
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| 414 | 414 | | such services, making referrals as appropriate to service providers and to 17 |
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| 415 | 415 | | entities having information on associated environmental issues such as the 18 |
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| 416 | 416 | | presence of asbestos in existing insulation. 19 BILL AS INTRODUCED H.196 |
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| 417 | 417 | | 2025 Page 18 of 18 |
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| 418 | 418 | | |
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| 419 | 419 | | |
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| 420 | 420 | | VT LEG #380503 v.1 |
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| 421 | 421 | | (3) In consultation with the Agency of Natural Resources, establish 1 |
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| 422 | 422 | | annual interim goals starting in 2014 to meet the 2017 and 2020 goals for 2 |
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| 423 | 423 | | improving the energy fitness of housing stock stated in 10 V.S.A. § 581(1). 3 |
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| 424 | 424 | | (4) Ensure the monitoring of the State’s progress in meeting the goals of 4 |
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| 425 | 425 | | 10 V.S.A. § 581(1). This monitoring shall be performed according to a 5 |
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| 426 | 426 | | standard methodology and on a periodic basis that is not less than annual. 6 |
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| 427 | 427 | | * * * 7 |
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| 428 | 428 | | Sec. 2. EFFECTIVE DATE 8 |
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| 429 | 429 | | This act shall take effect on July 1, 2025. 9 |
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