This bill establishes a three-year pilot program under the New Jersey Board of Public Utilities (BPU) to allow gas public utilities to recover costs associated with geothermal energy projects. These projects involve replacing aging or leaking natural gas pipelines with geothermal energy infrastructure, which is defined as utility-scale distribution systems that provide heating or cooling from geothermal sources. To participate, utilities must submit an infrastructure plan to the BPU, which will evaluate the project based on criteria such as size, cost, expected benefits, and financial impact on ratepayers. The BPU is also required to report annually to the Governor and Legislature on the pilot program's operations and determine in its final report whether to transition the pilot program into a permanent initiative.

Additionally, the bill amends existing law to include geothermal energy as part of the definition of public utilities, thereby expanding the regulatory scope of the BPU. Geothermal energy is characterized as a renewable resource derived from heat stored within the earth, encompassing both networked and deep geothermal energy. The BPU will publish its findings and reports on its website, and the pilot program will expire 30 days after the submission of the final report unless it is converted into a permanent program.