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Colorado's Energy-Related Bills in the 2022 Legislative Session

February 8, 2022

The Colorado General Assembly began its 2022 lawmaking term on January 12, 2022. The legislature, which consists of 65 representatives and 35 senators, will work through May 11 to address issues ranging from school funding to tax policy to alternative energy sources. This update provides an overview of the proposed bills that relate to clean energy and energy resiliency, what's missing, and how you can stay up to date on the 2022 legislative session.

Energy Legislation to Watch in 2022

SB22-073, Alternative Energy Sources

This bill, introduced by Senator Bob Rankin and Representative Hugh McKean, proposes a study investigating small modular nuclear reactors as a carbon-free energy source for Colorado. It also proposes expanding the megawatt threshold for hydroelectricity, so that a pumped hydroelectricity generation unit with a nameplate capacity of 400 megawatts or less constitutes "recycled energy." "Recycled energy," which uses heat leftover from industrial processed to generate electricity with no additional fuel or emissions, constitutes an "eligible energy resource" under Colorado. Colorado's Renewable Energy Standard requires qualifying retail utilities to generate a minimum amount of electricity from "eligible energy resources." C.R.S. § 40-2-124. This proposed bill would expand the definition of "eligible energy resources," and could provide more flexibility to utilities in meeting their requirements under the Renewable Energy Standard. You can find the full text of the bill here and track the bill here.

HB22-1013, Microgrids For Community Resilience Grant Program

This bipartisan bill concerns the creation of a grant program to finance the development of microgrids in rural communities that are at significant risk of severe weather or natural disaster events. As noted in the Bill Summary, "[t]he microgrids, which can be connected to or be disconnected from, and work independent of, the utility's electric grid, can increase an eligible rural community's resilience regarding any interruptions to the electric grid, such as those caused by severe weather or natural disaster events." You can find the full text of the bill here and track the bill here.

SB22-118, Encourage Geothermal Energy Use

This bipartisan bill seeks to encourage the use of geothermal energy by providing similar treatment to solar energy. Among other provisions, the bill will require the Colorado energy office to develop basic consumer education and guidance about leased or purchased geothermal installation, in consultation with industries that offer these options to consumers. You can find the full text of the bill here and track the bill here.

SB22-110, Equip Wind Turbine Aircraft Detection Lighting System

This bill requires an owner or operator of certain wind-powered energy generation facilities to equip the facility with an aircraft detection lighting system. You can find the full text of the bill here and track the bill here.

HB22-1140, Green Hydrogen To Meet Pollution Reduction Goals

This bill recognizes green hydrogen as a renewable energy source that certain retail electric service providers may use to meet statewide greenhouse gas pollution reduction goals. In addition, the bill requires the governor to update the Colorado greenhouse gas pollution reduction roadmap to expressly recognize green hydrogen as a renewable energy resource. You can find the full text of the bill here and track the bill here.

What's Missing?

None of the currently proposed bills address pore space ownership. As we wrote about in our July 2021 newsletter, carbon capture, use, and sequestration (“CCUS”) is increasingly attracting interest as a mechanism to reduce carbon emissions. To sequester carbon, a developer must inject the carbon underground through injection wells into the pore space. The pore space is comprised of the tiny voids in subsurface rock that are unoccupied by solid material, which could be used for the permanent sequestration of carbon. Some states, including Wyoming and North Dakota, have enacted statutes defining the “pore space" and who owns it. But under Colorado law, ownership of the pore space remains unclear. That uncertainty presents an obstacle to further investment and development in these projects.

Despite this uncertainty, at the time of writing, legislation addressing pore space ownership has not yet been proposed for the 2022 legislative session.

How to Stay Up-To-Date?

If you're interested in tracking a particular bill, the website for each bill includes information about when and where it is scheduled for debate. You can also track particular issues, like energy and environment, by following specific committees that focus on that work. Here is a link to the committees in both the House and Senate. You can tune into live recordings of committee hearings by checking out this link.