The proposed legislation, General Assembly Raised Bill No. 5337, aims to enhance district heating system incentives in Connecticut. It repeals and replaces Section 16-258d of the general statutes, establishing a framework for gas companies to develop incentive programs for district heating systems. These systems are defined as thermal loop natural gas demand reduction systems that capture a minimum of thirty million British thermal units of waste heat annually and distribute at least seventy-five percent of that heat to end-use customers. The bill mandates that gas companies submit their incentive program plans for approval to the Energy Conservation Management Board and the Department of Energy and Environmental Protection, with the program providing incentive payments to customers who connect to these systems for heating purposes.

Additionally, the bill introduces a new requirement for the Commissioner of Energy and Environmental Protection to develop and implement an incentive program by July 1, 2027, which will be based on the projected lifetime reduction in natural gas consumption attributable to the district heating system. The legislation also stipulates that the Public Utilities Regulatory Authority will ensure funding for these incentive payments through a conservation adjustment mechanism, capped at nine million dollars, with specific provisions for revenue collection from gas customers in the service area of the district heating system. The act is set to take effect on October 1, 2026.

Statutes affected:
Raised Bill: 16-258d