Committee reviews wide-ranging amendments to HB1035 covering generation procurements, ratepayer protections and expedited siting

A work group of the Economic Matters Committee on Wednesday reviewed a suite of amended provisions being folded into House Bill 10-35 that would direct procurements for large generation and storage, create a zero-emission credit for new nuclear projects, accelerate certificate-of-public-convenience-and-necessity (CPCN) reviews for selected projects, and add multiple ratepayer protections and utility-cost restrictions.

The amended bill, described to the committee as reprints and amendment sets (for example HB1035 233,226 and HB1035 563,326), would: require the Public Service Commission (PSC) to run a solicitation for roughly 3.1 gigawatts of dispatchable energy generation and a separate solicitation for up to 1.6 gigawatts of transmission-level battery storage; authorize an expedited CPCN process for projects selected in those solicitations; establish a ratepayer-funded zero-emission credit for new nuclear generation; and add new evidentiary and reporting requirements intended to limit certain costs recovered from ratepayers.

Committee staff explained the procurement elements and the expedited CPCN timeline. Under the solicitation process described, PSC and the PPRP (project planning/review program referenced by staff) would identify winning proposals within a short timeline: PPRP would recommend proposals within 45 days after the solicitation closes and the commission would notify applicants within 15 days thereafter. The expedited CPCN timeline for approved projects was described as shortening the usual pre-application and approval sequence to a more accelerated schedule (staff noted a target process on the order of several months rather than a year, with a cited illustrative timeframe of about 385 days from pre-application through approval in some iterations of the draft).

The amendment text as presented also sets selection priorities and reporting requirements. Staff described an initial limit of up to 10 approved solicitation projects and a stated selection ratio of four non-emitting projects for every one emission-emitting project; staff noted a technical clarification would be needed if fewer than 10 projects are selected to preserve the intended ratio. Projects that are natural-gas-fired or otherwise emitting would be required to submit a report every five years, documenting the feasibility of converting to hydrogen or zero-emission biofuels.

On nuclear, the amendment creates a mechanism similar in concept to New York’s approach but targeted to new nuclear generation: PSC would establish a zero-emission credit and a pricing formula that can be updated biennially; an escrow account and an obligation for electric companies to purchase credits based on sales data were described. Staff acknowledged the credit would be paid ultimately from ratepayer dollars, while noting the mechanics and exact rate impacts would be determined through regulatory and pricing processes.

Several changes in the amendments were described as intended to protect ratepayers. One new provision would require each public service company to demonstrate, in base rate proceedings, the reasonableness of decisions to use contractual (outside) labor rather than in‑house labor; the PSC would evaluate the company’s justification and cost comparisons. Committee members cited examples where contractor costs per pole replaced were substantially higher than in‑house costs, and staff said the demonstration would include a cost comparison and explanation of management decisions. Another provision would require each electric company to file a rate schedule for “large load” customers (defined in the amendment as customers at or above 100 megawatts or projected to be), with the schedules due to PSC by July 1, 2026. The large-load schedule would obligate the PSC to consider protections such as minimum billing demand, exit fees, and whether costs for system build-out are allocated to the large customer rather than to other ratepayers.

The amendments also address multi-year rate plans and reconciliation. The draft limits PSC approval of multi-year distribution rate plans to those that demonstrate definite consumer cost savings and, in certain circumstances, prevents reconciliation filings that would increase approved revenues unless those reconciliation filings were made on or before Jan. 1, 2025. Committee members expressed concerns that the provision should preserve PSC’s ability to true-up and return over-collected amounts to customers; staff said clarifying language could be added to make explicit that reconciliation filings could reduce rates where warranted.

The bill text adds a prohibition on recovery through rates of certain corporate expenses: membership dues, sponsorships, or contributions to industry trade associations that are 501(c) organizations; and costs associated with acquisition or use of private aircraft owned or leased by a public service company or its holding company. Staff described that typical trade associations such as the Edison Electric Institute (EEI) or the American Gas Association (AGA) would likely be excluded from rate recovery under that provision, while some research institutes that are 501(c)(3) might be subject to case-by-case debate.

Other technical changes in the amendment package include clarifications that a behind-the-meter co‑location arrangement could, in certain configurations, cause the supplier to be treated as an “electric company” for purposes of the article, a definition of “effective nameplate capacity” (changed to describe a four-hour delivery duration for storage), and creation of a “large capacity energy resource” category for resources that had applied to PJM interconnection or been approved by PJM on or before Jan. 1, 2025 and that have capacity ratings of 20 megawatts or more (after accounting for effective load-carrying capability).

Staff also described a tranche of changes pulled in from another bill and negotiated with sponsors: distribution-connected storage requirements, project labor or community benefit agreement language that had been in an ACE bill, and state procurement fixes intended to speed the state’s ability to hire consultants and run expedited procurements for energy-related projects.

Finally, the amendment package would allow the Strategic Energy Investment Fund to finance grants to electric companies that would be refunded or credited to residential distribution customers as a line item labeled “legislative energy hardship credit,” with two mandated distributions in fiscal year 2026 (a summer peak and a winter peak distribution). The Tax-General changes in the package would explicitly exclude such credits from taxable income.

Committee members and staff repeatedly flagged specific drafting items for follow-up: clarifying the interaction between expedited CPCN timelines and community engagement or environmental review; confirming how microgrid or truly off‑grid projects would be treated for RPS or greenhouse‑gas accounting; ensuring the ratepayer protections preserved PSC’s authority to credit customers when costs are lower than expected; and technical fixes to ensure the intended selection ratio in the solicitation works when fewer than ten projects are approved. Several committee members said they still expected some utilities and stakeholders to oppose elements of the package (for example the STRIDE/Scribe provisions and the nuclear credit), while others praised the added ratepayer demonstrations and procurement timelines as necessary to meet state energy and reliability goals.

The work group concluded with staff noting additional amendments would be circulated ahead of a formal Friday vote posture for the bill.