Amendment #1 to H.4348

HOUSE . . . . . . . No. 4515

The Commonwealth of Massachusetts
______________________________________

HOUSE OF REPRESENTATIVES, March 1, 2022.

The committee on Ways and Means, to whom was referred the Bill advancing offshore wind and clean energy (House, No. 4348), reports recommending that the same ought to pass with an amendment substituting therefor the accompanying bill (House, No. 4515).

For the committee,

AARON MICHLEWITZ.

FILED ON: 3/1/2022

HOUSE . . . . . . . . . . . . . . . No. 4515

The Commonwealth of Massachusetts

_______________

In the One Hundred and Ninety-Second General Court
(2021-2022)

_______________

An Act advancing offshore wind and clean energy.

Whereas, the deferred operation of this act would tend to defeat its purpose, which is to authorize forthwith the advancement of offshore wind and clean energy in the commonwealth, therefore it is hereby declared to be an emergency law, necessary for the immediate preservation of the public convenience.

Be it enacted by the Senate and House of Representatives in General Court assembled, and by the authority of the same, as follows:

SECTION 1. Chapter 21A of the General Laws is hereby amended by inserting after section 4A the following section:-

SECTION 4A½. The office of coastal zone management shall establish: (1) an environmental working group; and (2) a fisheries working group. Each working group shall be comprised of key experts and stakeholders to provide input on best practices for avoiding, minimizing and mitigating impacts to wildlife, including, but not limited to, threatened or endangered species, such as North Atlantic right whales, coastal and marine habitats, natural resources and ecosystems; traditional or existing water-dependent uses, including, but not limited to, commercial and recreational fishing during the construction and operation of facilities; and job training for opportunities in the offshore wind industry. The environmental and fisheries working groups shall conduct an ongoing review of implemented monitoring and mitigation programs and provide feedback and recommendations on an as-needed basis, to be considered by the office. Pre-construction engagement of the working groups shall correspond with project development, solicitation and permitting and a process to determine federal consistency with approved coastal management programs.

SECTION 2. Chapter 23 of the General Laws is hereby amended by adding the following section:-

Section 26. (a) As used in this section, the term “employment value” shall mean an assessment of the value of a particular occupation based on the entry wage, growth rate in employment and average annual open positions for the occupation.

(b) For the purpose of promoting access to academic and technical skills that prepare the workforce for high-skill, high-demand occupations in the commonwealth, the executive office of labor and workforce development shall provide the department of elementary and secondary education, annually, not later than February 1, a list of occupations in high-skill, high-demand industries in the commonwealth that either require an industry-recognized certification or for which such certification will materially enhance a job applicant’s opportunities for employment or increased compensation. The list shall include, but not be limited to: (i) the related workforce needs and shortages in each region of the commonwealth; and (ii) recommendations on potential courses and programming in public schools that can effectively contribute to providing credentials for high-skill, high-demand industries in the commonwealth. The list shall include occupations with high employment value; provided, that the top 20 per cent of occupations shall be high-skill, high-demand occupations; provided, however, that no occupation shall be included on the list which has an annual salary or wage in an amount less than 70 per cent of the average annual salary or wage in the commonwealth, unless the certification for such an occupation is stackable to another industry certification and required for the next level of occupation which does meet the 70 per cent wage criterion.

(c) The executive office of labor and workforce development, in consultation with the department of elementary and secondary education, shall make the list created pursuant to subsection (b) available to all school districts in the commonwealth and post the list publicly on the executive office of labor and workforce development’s website.

SECTION 3. Section 1 of chapter 23J of the General Laws, as appearing in the 2020 Official Edition, is hereby amended by striking out the definition of “Board” and inserting in place thereof the following 2 definitions:-

“Affiliate”, any business which directly or indirectly controls or is controlled by or is under direct or indirect common control of another business including, but not limited to, any business with which a business is merged or consolidated, or which purchases all or substantially all of the assets of a business.

“Board”, the board of directors of the center.

SECTION 4. Said section 1 of said chapter 23J, as so appearing, is hereby further amended by inserting after the definition of “Center” the following definition:-

“Certified offshore wind company”, an offshore wind company that has been certified by the center for participation in the Massachusetts offshore wind industry investment program and the offshore wind tax incentive program established in section 8A.

SECTION 5. Said section 1 of said chapter 23J, as so appearing, is hereby further amended by inserting after the definition of “Fund” the following 2 definitions:-

“Offshore wind company”, a business corporation, partnership, firm, unincorporated association or other entity engaged in offshore wind development, manufacturing or commercialization in the commonwealth and any affiliate thereof, which is, or the members of which are, subject to taxation under chapter 62, 63, 64H or 64I.

“Offshore wind organization”, a non-profit institution, adult and community learning service provider, labor organization, regional employment board, public or private higher education institution, vocational-technical education institution, designated port management agency or entity or other entity engaged in offshore wind development that is not an offshore wind company.

SECTION 6. Section 2 of said chapter 23J, as so appearing, is hereby amended by striking out subsection (b) and inserting in place thereof the following subsection:-

(b) The center shall be governed and its corporate powers exercised by a board of directors consisting of 14 directors: 1 of whom shall be the secretary of energy and environmental affairs or their designee, who shall serve as a chair; 1 of whom shall be the secretary of housing and economic development or their designee; 1 of whom shall be the secretary of administration and finance or their designee; 1 of whom shall be the secretary of labor and workforce development or their designee; 1 of whom shall be the president of the University of Massachusetts or their designee; 1 of whom shall be the executive director of the Massachusetts Workforce Alliance, Inc.; 1 of whom shall be the commissioner of the department of energy resources; 2 of whom shall be appointed by the speaker of the house of representatives, 1 of whom shall be a union representative; 2 of whom shall be appointed by the senate president, 1 of whom shall have knowledge of electricity distribution, generation, supply or power marketing; and 3 of whom shall be appointed by the governor, 1 of whom shall be a venture capitalist or a chief executive officer of a Massachusetts-based clean energy corporation with expertise in clean energy technologies in the commonwealth, 1 of whom shall be the president of a Massachusetts community college or their designee and 1 of whom shall be the president of a Massachusetts private college or university or their designee. Each of the 3 directors appointed by the governor, the 2 directors appointed by the speaker of the house of representatives and the 2 directors appointed by the senate president shall serve for a term of 5 years. A director shall be eligible for reappointment. A director may be removed from their appointment by the governor for cause. A person appointed to fill a vacancy in the office of an appointed director of the board shall be appointed in a like manner and shall serve for only the unexpired term of the director.

SECTION 7. Said section 2 of said chapter 23J, as so appearing, is hereby further amended by striking out, in line 66, the word “Six” and inserting in place thereof the following word:- Seven.

SECTION 8. Subsection (a) of section 3 of said chapter 23J, as so appearing, is hereby amended by adding the following paragraph:-

(32) to serve as a focal point, and provide state-wide coordination, for offshore wind initiatives; provided, that said responsibilities shall include, but shall not be limited to: (i) working with public and private higher education institutions in the commonwealth to coordinate and strengthen offshore wind research activities in the commonwealth; (ii) strengthening collaborative research and development between higher education institutions and companies located within the commonwealth; (iii) addressing critical barriers facing offshore wind companies in the commonwealth; (iv) assessing and reporting on infrastructure requirements that support the growing offshore wind industry in the commonwealth; (v) supporting the growth of an offshore wind supply chain in the commonwealth; (vi) supporting and developing offshore wind training initiatives; and (vii) supporting and growing offshore wind innovation and entrepreneurship in the commonwealth.

SECTION 9. Said chapter 23J is hereby further amended by inserting after section 8 the following section:-

Section 8A. (a) There shall be established and placed within the center a Massachusetts offshore wind industry investment program that shall be administered by the center, in consultation with the department of revenue. The purpose of the program shall be to develop and expand offshore wind industry-related employment opportunities in the commonwealth and to promote renewable energy-related innovations and economic development benefits to the commonwealth by supporting and stimulating siting, development, manufacturing and supply chain capacity in the offshore wind industry. Certified offshore wind companies shall be eligible for participation in the program, which shall consist of the offshore wind tax incentive program established in subsection (d) and access to expenditures pursuant to the Massachusetts offshore wind industry investment trust fund established in section 9A.

(b) The center may, upon a majority vote of the board, certify an offshore wind company as a certified offshore wind company upon: (i) the timely receipt, as determined by the center, of a certification proposal supported by independently verifiable information, signed under the pains and penalties of perjury by a person expressly authorized to contract on behalf of the offshore wind company and shall include, but not be limited to, an estimate of the projected new state revenue the offshore wind company expects to generate during the period for which the company seeks certification, together with a plan that shall include, but not be limited to: (1) precise goals and objectives, by which the offshore wind company proposes to achieve the projected new state revenue; (2) an estimate of the number of permanent full-time employees to be hired or retained; (3) an estimate of the year in which the company expects to hire or retain the employees; (4) an estimate of the projected average salaries of said employees; (5) an estimate of the projected taxable income pursuant to chapter 62 generated by said employees; (6) an estimate of the methods by which the company shall obtain new employees and pursue a diverse workforce; and (7) if applicable, an estimate of the company’s planned capital investment in the commonwealth; and (ii) findings made by the center, based on the certification proposal, documents submitted therewith and any additional investigation by the center that shall be incorporated in its approval, that: (1) the offshore wind company shall meet all statutory requirements and any other criteria that the center, in consultation with the department of revenue, may prescribe including, but not limited to, criteria in the following areas: (A) the offshore wind company’s potential for leveraging additional funding or attracting additional resources to the commonwealth; (B) the offshore wind company’s potential to promote offshore wind manufacturing in the commonwealth; and (C) the offshore wind company’s potential to create employment in the commonwealth; and (2) the offshore wind company shall meet the new state revenue, employment growth, and applicable capital investment projections, as specified in the certification proposal, over the period for which it receives benefits.

(c)(1) Certification granted pursuant to subsection (b) shall be valid for 5 years starting with the tax year in which certification is granted. Each certified offshore wind company shall file an annual report with the center and the department of revenue detailing whether it has met the specific targets established in the proposal pursuant to clause (i) of subsection (b).

(2) For the purposes of this paragraph, “material noncompliance” shall mean the failure of a certified offshore wind company to substantially achieve the new state revenue, job growth, and capital investment projections set forth in its certification proposal or any other act, omission or misrepresentation by the certified offshore wind company that frustrates the public purpose of the Massachusetts offshore wind industry investment program. The certification of an offshore wind company may be revoked by the center after an independent investigation by the center, in consultation with the department of revenue, and a determination that the certified offshore wind company is in material noncompliance with its certification proposal; provided, however, that the center shall review the certified offshore wind company at least annually. Revocation shall take effect on the first day of the tax year in which the center determines the certified offshore wind company to be in material noncompliance. The commissioner of revenue shall, as of the effective date of the revocation, disallow any credits, exemptions or other tax benefits allowed by the original certification of tax benefits under this section. The department of revenue shall issue regulations to establish a process to recapture the value of any credits, exemptions or other tax benefits allowed by the certification under this section.

(3) Nothing in this subsection shall limit any legal remedies available to the commonwealth against any certified offshore wind company.

(d) There shall be established an offshore wind tax incentive program. The center, in consultation with the department of revenue, may annually authorize incentives, including those established in subsections (aa) and (bb) of section 6 of chapter 62 and sections 38KK and 38LL of chapter 63, that shall not exceed $50,000,000 annually. The center, in consultation with the department of revenue, may limit the incentives to a specific dollar amount or time duration or in any other manner deemed appropriate by the department of revenue; provided, however, that the department of revenue shall only allocate the incentives among certified offshore wind companies.

The center shall provide an estimate to the secretary of administration and finance of the tax cost of extending benefits to a proposed project before certification, as approved by the commissioner of revenue, based on reasonable projections of project activities and costs. Tax incentives shall not be available to a certified offshore wind company unless expressly granted by the secretary of administration and finance in writing.

SECTION 10. Subsection (a) of section 9 of said chapter 23J, as so appearing, is hereby amended by striking out the third sentence and inserting in place thereof the following sentence:- There shall be credited to the trust fund amounts collected and designated for deposit into the trust fund under section 20 of chapter 25 and any income derived from the investment of amounts credited to the trust fund.

SECTION 11. Said chapter 23J is hereby further amended by striking out section 9A, inserted by section 13 of chapter 102 of the acts of 2021, and inserting in place thereof the following section:-

Section 9A. (a) There shall be established and placed within the center a trust fund to be known as the Massachusetts Offshore Wind Industry Investment Trust Fund to be held by the center separate and apart from its other funds. The trust fund shall be credited with: (i) any appropriations, bond proceeds or other monies authorized by the general court and specifically designated to be credited thereto; (ii) amounts collected and designated for deposit into the trust fund pursuant to section 20 of chapter 25; (iii) funds from public and private sources and other gifts, grants and donations; and (iv) any income derived from the investment of amounts credited to the trust fund. All amounts credited to the trust fund shall be held in trust and used solely for activities and expenditures consistent with the public purpose of the trust fund pursuant to subsection (b), and the ordinary and necessary expenses of administration and operation associated with the trust fund. All available monies in the trust fund that are unexpended at the end of each fiscal year shall not revert to the General Fund and shall be available for expenditure in the subsequent fiscal year.

(b) To advance the following public purposes for the offshore wind industry in the commonwealth, the center shall make expenditures from the trust fund to:

(1) stimulate increased financing for the siting and expansion of permanent offshore wind manufacturing facilities in the commonwealth by providing financing for the construction or expansion of new facilities;

(2) provide funds for up to 50 per cent of costs incurred by a certified offshore wind company interconnecting an offshore wind project or projects to the power grid, subject to a matching requirement by a certified offshore wind company; provided, that said matching requirement may be increased in relation to the overall costs incurred;

(3) promote offshore wind innovation;

(4) promote manufacturing activities for new or existing advanced technologies and offshore wind research;

(5) provide funds for the revitalization and development of ports in the commonwealth to support the offshore wind industry;

(6) provide funds for workforce training to prepare individuals for offshore wind careers to: (i) public or private higher education institutions, including Quincy College, and vocational-technical education institutions for the adoption of basic safety training and basic technical training programs; provided, that the center shall prioritize awards to education institutions seeking accreditation in internationally recognized training standards, including, but not limited to, standards developed by the Global Wind Organisation; (ii) public or private higher education institutions, including Quincy College, and vocational-technical education institutions for the development, expansion and promotion of offshore wind professional certificate programs and courses tailored to careers in the offshore wind industry for students in associate and baccalaureate degree programs; (iii) adult and community learning service providers, labor organizations, public or private higher education institutions, including Quincy College, and vocational-technical education institutions for the sponsorship of award, scholarship and paid internship programs to support the education and training of individuals seeking careers in the offshore wind industry; provided, that the center shall prioritize the promotion of careers in the skilled trades, water transportation, operations and maintenance and other occupations that the center identifies as high priority; and (iv) regional employment boards to develop a regional strategy to support the development of the offshore wind industry and to publish their findings as an addendum to their workforce development blueprints;

(7) leverage funds to secure future federal funding to support the offshore wind industry;

(8) provide funding for the development and coordination of secondary, vocational-technical, and higher education programs related to the offshore wind industry;

(9) provide funding for site remediation, preparation and ancillary infrastructure improvement projects to support the offshore wind industry;

(10) support a long-term contract for renewable energy certificates, energy and a combination of both renewable energy certificates and energy, which the center may resell to municipal aggregations or other private aggregation groups through shorter term contracts; and

(11) otherwise further the public purposes set forth in this section.

(c) In furtherance of the public purposes set forth in subsection (b), the center may expend monies from the trust fund to: (i) make grants, contracts, loans, equity investments, energy production credits, bill credits or rebates available to customers; (ii) provide financial or debt service obligation assistance; or (iii) take any other action, in such forms, under such terms and conditions and under such selection procedures as the center deems appropriate and otherwise in a manner consistent with good business practices; provided, that the center shall conduct, when practicable, competitive procurements; provided further, that the center shall endeavor to leverage the full range of resources, expertise and participation of other state and federal agencies and instrumentalities in the design and implementation of programs conducted pursuant to this section; and provided further, that the board shall determine and incorporate into the minutes of its proceedings a finding that any such action is calculated to advance the public purpose and public interests set forth in this section.

(d) The center shall make no expenditure from the trust fund unless: (i) the expenditure has been approved by a majority vote of the board; (ii) the recipient is an offshore wind company or offshore wind organization; provided, that an offshore wind company that has not been certified pursuant to section 8A shall not receive an award in an amount greater than $5,000,000; (iii) the center finds, to the extent possible, that a definite benefit to the commonwealth’s economy may reasonably be expected from said expenditure; and (iv) the expenditure conforms with any rules the board may adopt to administer the trust fund. In evaluating a request or application for funding, the center shall consider the following: (i) the appropriateness of the project; (ii) whether the project has significant potential to expand employment; (iii) the project’s potential to enhance technological advancements; (iv) the project’s potential for leveraging additional funding or attracting resources to the commonwealth; and (v) the project’s potential to promote manufacturing in the commonwealth.

(e) Subject to the approval of the board and not inconsistent with any strategic or annual operational plans, investment activity of monies from the trust fund by the center may include: (i) an equity fund to provide risk capital to offshore wind companies, offshore wind organizations and projects; (ii) a debt fund to provide loans to offshore wind companies, offshore wind organizations, projects, intermediaries and end-users; and (iii) a market growth assistance fund to be used to attract private capital to the equity and debt funds. To implement these investment activities, the center may retain, through a bid process, public or private sector investment fund managers, who shall have prior knowledge and experience in fund management and possess related skills in offshore wind, renewable energy and related technologies development, to direct the investment activity described in this section and to seek other fund co-sponsors to contribute public and private capital from the commonwealth and other states; provided, however, that such capital shall be appropriately segregated. Subject to the approval of the board, the managers may retain necessary services and consultants to carry out the purposes of the fund. The managers shall develop a business plan to guide investment decisions which shall be approved by the board before any expenditure from the trust fund and which shall be consistent with the plan for the trust fund as adopted by the board.

(f) The center shall not make expenditures from or commitment of the assets of the trust fund if the amount of the trust fund is less than the minimum requirement established by the board as a result of the expenditure.

SECTION 12. Section 14 of said chapter 23J, inserted by section 11 of chapter 24 of the acts of 2021, is hereby repealed.

SECTION 13. Section 20 of chapter 25 of the General Laws, as appearing in the 2020 Official Edition, is hereby amended by striking out subsection (a) and inserting in place thereof the following subsection:-

(a) The department shall require a mandatory charge of 14.65 mill per therm for all natural gas consumers and a mandatory charge of 0.5 mill per kilowatt-hour for all electricity consumers, except those served by a municipal lighting plant that does not supply generation service outside its own service territory or does not open its service territory to competition at the retail level, to support the development and promotion of renewable energy projects. All revenues generated by the mandatory charge for natural gas consumers shall be deposited into the Massachusetts Renewable Energy Trust Fund established in section 9 of chapter 23J. All revenues generated by the mandatory charge for electricity consumers shall be deposited into the Massachusetts Offshore Wind Industry Investment Trust Fund established in section 9A of said chapter 23J.

SECTION 14. Said section 20 of said chapter 25 is hereby further amended by striking out subsection (a), inserted by section 13, and inserting in place thereof the following subsection:-

(a) The department shall require a mandatory charge of 14.65 mill per therm for all natural gas consumers and a mandatory charge of 0.5 mill per kilowatt-hour for all electricity consumers, except those served by a municipal lighting plant that does not supply generation service outside its own service territory or does not open its service territory to competition at the retail level, to support the development and promotion of renewable energy projects. All revenues generated by the mandatory charges under this subsection shall be deposited into the Massachusetts Renewable Energy Trust Fund established in section 9 of chapter 23J.

SECTION 15. Section 6 of chapter 62 of the General Laws, as appearing in the 2020 Official Edition, is hereby amended by adding the following 2 subsections:-

(aa)(1) A taxpayer, to the extent authorized by the offshore wind tax incentive program established in subsection (d) of section 8A of chapter 23J, may be allowed a refundable jobs credit against the tax liability imposed under this chapter in an amount determined by the Massachusetts clean energy technology center established in section 2 of chapter 23J, in consultation with the department.

(2) A taxpayer taking a credit under this subsection shall commit to the creation of a minimum of 50 net new permanent full-time employees in the commonwealth.

(3) A credit allowed under this subsection shall reduce the liability of the taxpayer under this chapter for the taxable year. If a credit claimed under this subsection by a taxpayer exceeds the taxpayer’s liability as otherwise determined under this chapter for the taxable year, 90 per cent of such excess credit, to the extent authorized by the offshore wind tax incentive program, shall be refundable to the taxpayer. Excess credit amounts shall not be carried forward to other taxable years.

(4) The department shall issue the refundable portion of the jobs credit without further appropriation and in accordance with the cumulative amount, including the current year costs of incentives allowed in previous years, which shall not exceed $50,000,000 annually as set forth in subsection (d) of section 8A of chapter 23J.

(bb)(1) As used in this subsection, the following words shall, unless the context clearly requires otherwise, have the following meanings:

“Capital investment”, expenses incurred for the site preparation and construction, repair, renovation, improvement, or equipping of a building, structure, facility, or other improvements to real property, including, but not limited to, site-related utility and transportation infrastructure improvements.

“Center”, the Massachusetts clean energy technology center established in section 2 of chapter 23J.

“Certified offshore wind company”, as defined in section 1 of chapter 23J.

“Offshore wind facility”, any building, complex of buildings, or structural components of buildings, including water access infrastructure, and all machinery and equipment used in the manufacturing, assembly, development or administration of component parts that are primarily used to support the offshore wind industry.

“Owner”, a taxpayer subject to tax under this chapter that: (i) holds title to an offshore wind facility; or (ii) ground leases the land underlying the facility for at least 50 years.

“Tenant”, a taxpayer subject to tax under this chapter that is a lessee in an offshore wind facility.

(2) An owner or tenant, to the extent authorized by the offshore wind tax incentive program established in section 8A of chapter 23J, may take a refundable credit against the taxes imposed by this chapter in an amount, as determined by the center, of up to 50 per cent of its total capital investment in an offshore wind facility. The total amount of tax credit awarded pursuant to this subsection shall be distributed in equal parts over the 5 taxable years that correspond to the period in which the owner or tenant is certified pursuant to said section 8A of said chapter 23J.

(3) An owner shall be eligible for a tax credit authorized under this subsection if the owner demonstrates to the department that: (i) the owner is a certified offshore wind company; (ii) the owner’s total capital investment in the offshore wind facility equals not less than $50,000,000; and (iii) the offshore wind facility will employ not less than 200 new full-time employees by the fifth year of the owner’s certification period under section 8A of chapter 23J.

(4) A tenant shall be eligible for a tax credit authorized pursuant to this subsection if the tenant demonstrates to the department that: (i) the tenant is a certified offshore wind company; (ii) the owner has made a total capital investment in the facility that equals not less than $50,000,000; (iii) the tenant occupies a leased area of the offshore wind facility that represents not less than 25 per cent of the owner’s capital investment in the facility; and (iv) the tenant will employ, in the aggregate with other tenants at the offshore wind facility, not less than 200 full-time employees by the fifth year of the tenant’s certification period pursuant to section 8A of chapter 23J. The amount of tax credits awarded to a tenant under this subsection for a taxable year shall not exceed the tenant’s total lease payments for occupancy of the offshore wind facility for the taxable year.

(5) An owner or tenant taking a credit authorized in this subsection shall not take the credits authorized in subsection (g) or (aa) in the same taxable year.

(6) The department shall issue the refundable portion of the credit without further appropriation and in accordance with the cumulative amount, including the current year costs of incentives allowed in previous years, which shall not exceed $50,000,000 annually as set forth in subsection (d) of section 8A of chapter 23J.

(7) The department shall promulgate such rules and regulations as are necessary to administer the credit established in this subsection.

SECTION 16. Chapter 63 of the General Laws is hereby amended by inserting after section 38JJ the following 2 sections:-

Section 38KK. (a)(1) A corporation subject to tax under this chapter, to the extent authorized by the offshore wind tax incentive program established in subsection (d) of section 8A of chapter 23J, may be allowed a refundable jobs credit against the tax liability imposed under this chapter in an amount determined by the Massachusetts clean energy technology center established in section 2 of chapter 23J, in consultation with the department.

(2) A corporation taking a credit under this section shall commit to the creation of a minimum of 50 net new permanent full-time employees in the commonwealth.

(3) A credit allowed under this section shall reduce the liability of the corporation under this chapter for the taxable year. If a credit claimed under this section by a corporation exceeds the corporation’s liability as otherwise determined under this chapter for the taxable year, 90 per cent of such excess credit, to the extent authorized by the offshore wind tax incentive program, shall be refundable to the corporation. Excess credit amounts shall not be carried forward to other taxable years.

Section 38LL. (a) As used in this section, the following words shall, unless the context clearly requires otherwise, have the following meanings:-

“Center”, the Massachusetts clean energy technology center established in section 2 of chapter 23J.

“Certified offshore wind company”, as defined in section 1 of chapter 23J.

“Owner”, a taxpayer subject to tax under this chapter that: (i) is a corporation that holds title to an offshore wind facility; or (ii) ground leases the land underlying an offshore wind facility for at least 50 years.

“Tenant”, a taxpayer subject to tax under this chapter that is a lessee in an offshore wind facility.

(b) An owner or tenant, to the extent authorized by the offshore wind tax incentive program established in section 8A of chapter 23J, may take a refundable credit against the tax imposed by this chapter in an amount, as determined by the center, of up to 50 per cent of its total capital investment in an offshore wind facility. The total amount of tax credit awarded pursuant to this section shall be distributed in equal parts over the 5 taxable years that correspond to the period in which the owner or tenant is certified pursuant to said section 8A of said chapter 23J.

(c) An owner shall be eligible for a tax credit authorized under this section if the owner demonstrates to the department that: (i) the owner is a certified offshore wind company; (ii) the owner’s total capital investment in the offshore wind facility equals not less than $50,000,000; and (iii) the offshore wind facility will employ not less than 200 new full-time employees by the fifth year of the owner’s certification period under section 8A of chapter 23J.

(d) A tenant shall be eligible for a tax credit authorized pursuant to this section if the tenant demonstrates to the department that: (i) the tenant is a certified offshore wind company; (ii) the owner of the offshore wind facility has made a total capital investment in the facility that equals not less than $50,000,000; (iii) the tenant occupies a leased area of the offshore wind facility that represents not less than 25 per cent of the owner’s capital investment in the facility; and (iv) the tenant will employ, in the aggregate with other tenants at the offshore wind facility, not less than 200 full-time employees by the fifth year of the tenant’s certification period under section 8A of chapter 23J. The amount of tax credits awarded under this section to a tenant for a taxable year shall not exceed the tenant’s total lease payments for occupancy of the offshore wind facility for the taxable year.

(e) An owner or tenant taking a credit authorized in this section shall not take the credits authorized in section 38N or 38KK in the same taxable year.

(f) The department shall issue the refundable portion of the credit without further appropriation and in accordance with the cumulative amount, including the current year costs of incentives allowed in previous years, which shall not exceed $50,000,000 annually as set forth in subsection (d) of section 8A of chapter 23J.

(g) The department shall promulgate such rules and regulations as are necessary to administer the credit established in this section.

SECTION 17. Section 1 of chapter 164 of the General Laws, as appearing in the 2020 Official Edition, is hereby amended by inserting after the definition of “Department” the following definition:-

“Distributed energy resources”, a generation facility or renewable energy facility connected directly to a distribution facility or to a retail customer facility, including a facility behind the retail customer’s meter, which alleviates or avoids transmission or distribution constraints or the installation of a new transmission facility or distribution facility.

SECTION 18. Said chapter 164 is hereby further amended by inserting after section 92A the following 2 sections:-

Section 92B. (a) The department shall direct each electric company to develop an electric-sector transformation plan to proactively upgrade the distribution and, where applicable, transmission systems to: (i) improve grid reliability and resiliency; (ii) enable increased, timely adoption of renewable energy and distributed energy resources; (iii) promote energy storage and electrification technologies necessary to decarbonize the environment and economy; and (iv) prepare for future climate-driven impacts on the transmission and distribution systems, thereby helping the commonwealth realize its statewide greenhouse gas emissions limits and sublimits under chapter 21N.

(b) An electric-sector transformation plan developed pursuant to subsection (a) shall describe in detail each of the following elements: (i) improvements to the electric distribution system to increase reliability and strengthen system resiliency to address potential weather-related and disaster-related risks; (ii) the availability and suitability of new technologies including, but not limited to, smart inverters, advanced metering and telemetry, and energy storage technology for meeting forecasted reliability and resiliency needs, as applicable; (iii) patterns and forecasts of distributed energy resource adoption in the company’s territory and upgrades that would facilitate increased adoption of such technologies; (iv) improvements to the distribution system that will enable customer preferences for access to renewable energy resources; (v) improvements to the distribution system that will facilitate transportation or building electrification; (vi) improvements to the transmission or distribution system to facilitate achievement of the statewide greenhouse gas emissions limits under chapter 21N; (vii) opportunities to deploy energy storage technologies to improve renewable energy utilization and avoid curtailment; and (viii) alternatives to the proposed investments in the distribution and transmission systems including rate design, load management and other methods for reducing demand. For all proposed investments and alternatives, each electric company shall identify customer benefits associated with the investments and alternatives including, but not limited to, safety, grid reliability and resiliency, facilitation of the electrification of buildings and transportation, integration of distributed energy resources, avoided renewable energy curtailment, reduced greenhouse gas emissions and air pollutants, and avoided land use impacts.

(i) prepare and use 3 planning horizons for electric demand, including a 5-year forecast, a 10-year forecast and a demand assessment through 2050 to account for future trends in the adoption of renewable energy, distributed energy resources, and energy storage and electrification technologies necessary to achieve the statewide greenhouse gas emission limits and sublimits under chapter 21N;

(ii) consider and include a summary of related investments that have been reviewed or approved by the department previously; and

(iii) solicit input, such as planning scenarios and modeling, from the Grid Modernization Advisory Council established in section 92C, and conduct technical conferences and a minimum of 2 stakeholder meetings to inform the public, appropriate state and federal agencies, and companies engaged in the development and installation of distributed generation, energy storage, vehicle electrification systems and building electrification systems.

(d) An electric company shall submit its plan for review, input and recommendations to the Grid Modernization Advisory Council established in section 92C by April 1, 2023, and thereafter in accordance with the schedule filed with the department pursuant to section 94; provided, that such plans shall be submitted to the Grid Modernization Advisory Council not later than 90 days before the electric company files its schedule; and provided further, that the Grid Modernization Advisory Council shall return such plans to the company with recommendations not later than 45 days before the company files its schedule. An electric company shall submit its plan, together with a demonstration of the Grid Modernization Advisory Council’s review, input and recommendations, along with a statement of any unresolved issues, to the department at the time of filing its schedule pursuant to section 94. The department shall promptly consider the plans and shall provide an opportunity for interested parties to be heard in a public hearing. The department shall approve within 7 months of submittal all prudent investments or alternative investments that provide net benefits for customers proposed in such plans and shall issue a final order directing the company to implement all approved investments of such plans, including determination of any unresolved issues identified in the initial filing; provided, that in order to be approved, plans shall conclusively demonstrate the need for projects subject to review by the energy facilities siting board pursuant to section 69H and by the department pursuant to section 72. The electric company shall be permitted to recover all reasonably and prudently incurred costs for implementing such plans as approved by the department. If an electric company fails to deliver the projected customer benefits associated with any specific investment or group of investments during the course of a plan, the department shall prohibit the company from earning a return on those investments until such time as the company delivers the customer benefits.

(e) An electric-sector transformation plan developed by an electric company pursuant to subsection (a) shall propose discrete, specific, enumerated investments to the distribution system or alternatives to such investments that will facilitate grid modernization, greater reliability and resiliency, increased enablement of distributed energy resources, increased transportation electrification, and increased building electrification, in order to meet the statewide greenhouse gas emissions limits and sublimits under chapter 21N. An electric company shall submit twice per year reports to the department on the deployment of approved investments and any other performance metrics included in the approved plans.

Section 92C. (a) There shall be a Grid Modernization Advisory Council to consist of the commissioner of the department of energy resources, or a designee, who shall serve as chair; the attorney general, or a designee; the commissioner of the department of environmental protection, or a designee; 13 members to be appointed by the governor: 1 of whom shall be a representative of residential consumers, 1 of whom shall be a representative from a local agency administering the low-income weatherization assistance program, 1 of whom shall be a representative of the environmental advocacy community, 1 of whom shall be a representative of an environmental justice community organization, 1 of whom shall be a representative of the transmission scale renewable energy industry with expertise in projects of greater than 20 megawatts, 1 of whom shall be a representative of the distributed generation scale renewable energy industry with expertise in projects of less than 5 megawatts, 1 of whom shall be a representative of the energy storage industry, 1 of whom shall be a representative of the electric vehicle industry, 1 of whom shall be a representative of the building electrification industry, 1 of whom shall be a representative of municipal or regional interests, 1 of whom shall have technical and engineering expertise in interconnecting clean energy, 1 of whom shall be a representative of businesses, including large commercial and industrial end-use customers; and 1 member from each electric company operating in the commonwealth who shall serve as non-voting members. Members shall serve for terms of 5 years and may be reappointed.

(b) The council shall seek to encourage least-cost investments in the electric distribution systems or alternatives to the investments that will facilitate the achievement of the statewide greenhouse gas emission limits and sublimits under chapter 21N and increase transparency and stakeholder engagement in the grid planning process. The council shall review and provide recommendations on electric-sector transformation plans developed pursuant to subsection (a) of section 92B that maximize net customer benefits and will enable cost-effective interconnection of distributed and transmission-scale renewable energy resources, facilitate electrification of buildings and transportation, improve grid reliability and resiliency, and reduce impacts on and provide benefits for environmental justice populations and communities.

(c) The council may retain expert consultants; provided, that such consultants shall not have any current contractual relationship with an electric company operating in the commonwealth or any affiliate of such electric company.

(d) Nothing in this section shall eliminate or modify the obligations otherwise established by law of electric companies to provide orderly, economic expansion of equipment and facilities to meet future system demand with acceptable system performance. An electric company shall not be prohibited by action of the council or otherwise from planning and completing infrastructure changes, reinforcements or investment projects necessary for the reliability and resiliency of the transmission and distribution system pending action by the council or the department on an electric-sector transformation plan developed pursuant to said subsection (a) of said section 92B.

SECTION 19. Section 83B of chapter 169 of the acts of 2008, inserted by section 12 of chapter 188 of the acts of 2016, is hereby amended by striking out the definitions of “Firm service hydroelectric generation” and “Long-term contract” and inserting in place thereof the following 5 definitions:-

“Firm energy delivery”, dispatchable non-emitting energy provided in a long-term contract with guaranteed continuous availability at rated power for 1 or more discrete multi-day periods of extreme heat and cold weather, low non-dispatchable power production, or other grid contingencies, as designated by the department of energy resources, to ensure electric reliability and security in a zero-carbon electric system. Such firm energy delivery may include but shall not be limited to energy from multiple non-emitting energy generation resources and energy storage systems managed in a coordinated manner, in addition to other market services.

“Firm service hydroelectric generation”, hydroelectric generation provided without interruption, for 1 or more discrete periods designated in a long-term contract, including, but not limited to, multiple hydroelectric run-of-the-river generation units managed in a portfolio that creates firm service through the diversity of multiple units.

“Long-duration energy storage system”, an energy storage system, as defined in section 1 of chapter 164 of the General Laws, that is capable of dispatching energy at its full rated capacity for a period of 5 hours or greater, up to 24 hours.

“Long-term contract”, a contract for a period of 15 to 20 years for offshore wind energy generation pursuant to section 83C or for clean energy generation pursuant to section 83D.

“Multi-day energy storage system”, an energy storage system, as defined in section 1 of chapter 164 of the General Laws, that is capable of dispatching energy at its full rated capacity for a period greater than 24 hours.

SECTION 20. Section 83C of said chapter 169, inserted by said section 12 of said chapter 188, as most recently amended by section 69 of chapter 24 of the acts of 2021, is hereby further amended by striking out subsections (a) through (d) and inserting in place thereof the following 4 subsections:-

(a) In order to facilitate the financing of offshore wind energy generation resources in the commonwealth every distribution company shall jointly and competitively solicit proposals for offshore wind energy generation; provided, however, that the solicitation process shall not be deemed uncompetitive by the department of public utilities based solely on the distribution companies receiving a bid or multiple bids from a single company or its affiliates if the levelized price per megawatt hour, plus associated transmission costs, of the proposed project is equal to or less than the levelized price per megawatt hour, plus associated transmission costs, of the previous procurement; and provided further, if reasonable proposals have been received, each distribution company shall enter into long-term contracts that are cost-effective and maximize economic development. Long-term contracts executed pursuant to this section shall be subject to the approval of the department of public utilities and shall be apportioned among the distribution companies.

(b) The timetable and method for solicitations of long-term contracts shall be proposed by the department of energy resources in coordination with the distribution companies using a competitive bidding process, and shall be subject to review and approval by the department of public utilities. The department of energy resources, in coordination with the distribution companies, shall consult with the attorney general regarding the choice of solicitation methods. If the department of energy resources and the distribution companies are unable to agree on a timetable and method for solicitations, the department of energy resources, in consultation with the independent evaluator, shall make a final determination as to the timetable and methods for solicitations to be submitted to the department of public utilities for approval. A solicitation may be coordinated and issued jointly with other New England states or entities designated by those states. The distribution companies may conduct 1 or more competitive solicitations through a staggered procurement schedule developed by the department of energy resources in coordination with the distribution companies; provided, that the schedule shall ensure that the distribution companies enter into cost-effective long-term contracts for offshore wind energy generation equal to approximately 5,600 megawatts of aggregate nameplate capacity not later than June 30, 2027, including capacity authorized pursuant to section 21 of chapter 227 of the acts of 2018; and provided further, that individual solicitations shall seek proposals for no less than 400 megawatts of aggregate nameplate capacity of offshore wind energy generation resources. The staggered procurement schedule developed by the department of energy resources in coordination with the distribution companies, if applicable, shall specify that a subsequent solicitation shall occur within 24 months of a previous solicitation. If the department of energy resources, in consultation with the distribution companies and the independent evaluator, determines that reasonable proposals were not received pursuant to a solicitation, the department of energy resources may terminate the solicitation, and may require additional solicitations to fulfill the requirements of this section. Proposals received pursuant to a solicitation under this section shall be evaluated by the selection committee established in subsection (o). As part of the evaluation process, the selection committee shall produce a numeric score for each bid’s economic development commitments and for plans for financial and technical assistance to support wildlife and habitat monitoring; provided, that plans for financial and technical assistance to support wildlife and habitat monitoring shall represent not less than 5 per cent of a bid’s overall score in the solicitation.

(c) In developing proposed long-term contracts, the distribution companies shall consider long-term contracts for renewable energy certificates, for energy and for a combination of both renewable energy certificates and energy. A distribution company may decline to pursue a contract resulting from a proposal if the proposal’s terms and conditions would require the contract obligation to place an unreasonable burden on the distribution company’s balance sheet; provided, however, that the distribution company shall take all reasonable actions to structure the contracts, pricing or administration of the products purchased under this section in order to prevent or mitigate an impact on the balance sheet or income statement of the distribution company or its parent company, subject to the approval of the department of public utilities; and provided further, that mitigation shall not increase costs to ratepayers. If a distribution company deems a contract to be unreasonable, the distribution company shall consult with the department of energy resources and, within 20 days of the date of its decision, submit a filing to the department of public utilities. The filing shall include, in the form and detail prescribed by the department of public utilities, documentation supporting the distribution company’s decision to decline the contract as unreasonable. Following a distribution company’s filing, and within 4 months of the date of filing, the department of public utilities shall approve or reject the distribution company’s decision and may order the distribution company to reconsider any contract. The department of public utilities shall take into consideration the recommendations of the department of energy resources concerning the distribution company’s decision. The final contract executed shall be subject to review by the department of public utilities. The department of energy resources may require additional solicitations to fulfill the requirements of this section.

(d) The department of public utilities shall promulgate regulations consistent with this section. The regulations shall: (1) allow offshore wind developers of offshore wind energy generation to submit proposals for long-term contracts consistent with this section; (2) require that a proposed long-term contract executed by the distribution companies under a proposal be filed with, and approved by, the department of public utilities before becoming effective; (3) provide for an annual remuneration for the contracting distribution company up to 2.5 per cent of the annual payments under the contract; provided, that the distribution company demonstrates either: (i) that the financing cost reduction enabled by entering into the contract as compared to an uncontracted merchant project is equal to or greater than the requested remuneration rate, or (ii) that the financial obligation or risk incurred by the distribution company for entering into the long-term contract support the requested remuneration rate, such provision to be acted upon by the department of public utilities at the time of contract approval; (4) require associated transmission costs to be incorporated into a proposal; provided, that to the extent there are transmission costs included in a bid, the department of public utilities may authorize or require the contracting parties to seek recovery of such transmission costs of the project through federal transmission rates, consistent with policies and tariffs of the Federal Energy Regulatory Commission, to the extent the department finds such recovery is in the public interest; and (5) require that proposals meet the following criteria: (i) provide enhanced electricity reliability and energy security; (ii) contribute to reducing winter electricity price spikes; (iii) are cost effective to electric ratepayers in the commonwealth over the term of the contract, taking into consideration potential economic and environmental benefits to the ratepayers; (iv) avoid line loss and mitigate transmission costs to the extent possible and ensure that transmission cost overruns, if any, are not borne by ratepayers; (v) provide optimal interconnection locations; (vi) adequately demonstrate project viability in a commercially reasonable timeframe; (vii) allow offshore wind energy generation resources to be paired with energy storage systems, including new and existing long-duration and multi-day energy storage systems; (viii) include an initial environmental and fisheries mitigation plan for the construction and operation of such offshore wind facilities; (ix) mitigate impacts to the marine environment by providing financial and technical assistance to support robust monitoring of wildlife and habitat through a contribution to regional research efforts; (x) include benefits to environmental justice populations and low-income ratepayers in the commonwealth; and (xi) where feasible, create and foster economic development and quality, high-paying jobs in the commonwealth, including opportunities for diversity, equity and inclusion.

SECTION 21. Said section 83C of said chapter 169, as so amended, is hereby further amended by striking out subsection (f) and inserting in place thereof the following subsection:-

(f) The department of energy resources and the attorney general shall jointly select, and the department of energy resources shall contract with, an independent evaluator to: (1) monitor and report on the solicitation and evaluation process; and (2) participate as a member of the selection committee pursuant to subsection (e). The independent evaluator shall assist the department of energy resources in determining whether a proposal received pursuant to subsection (b) is reasonable and to assist the department of public utilities in its consideration of long-term contracts filed for approval. As a member of the selection committee pursuant to subsection (e), the independent evaluator shall hold equal weight in the selection of winning bids.

To ensure an open, fair and transparent solicitation and bid selection process that is not unduly influenced by an affiliated company, the independent evaluator shall: (1) issue a report to the department of public utilities analyzing the timetable and method of solicitation and the solicitation process implemented by the distribution companies and the department of energy resources under subsection (b) and include recommendations, if any, for improving the process; and (2) upon the opening of an investigation by the department of public utilities into a proposed long-term contract for a winning bid proposal: (i) file a report with the department of public utilities that summarizes and analyzes the solicitation and evaluation process; and (ii) provide the independent evaluator’s assessment of whether all bids were evaluated in a fair and objective manner.

The independent evaluator shall have access to the information and data related to the competitive solicitation and bid selection process that is necessary to fulfill the purposes of this subsection; provided, however, that the independent evaluator shall ensure that all proprietary information remains confidential. The department of public utilities shall consider the findings of the independent evaluator and may adopt recommendations made by the independent evaluator as a condition for approval. If the independent evaluator concludes in the findings that the solicitation and bid selection of a long-term contract was not fair and objective and that the process was substantially prejudiced as a result, the department of public utilities shall reject the winning bid proposal. The department of energy resources shall be reimbursed for cost of the independent evaluator through non-refundable bid fees required of offshore wind developers as part of the solicitation process.

SECTION 22. Said section 83C of said chapter 169, as so amended, is hereby further amended by striking out subsection (m) and inserting in place thereof the following 4 subsections:-

(m) The plan required in subclause (viii) of clause 5 of subsection (d) shall include, but shall not be limited to, a detailed description of the best management practices and any on-site or off-site mitigation the applicant shall employ, informed by the latest science at the time the plan is made, that will avoid, minimize and mitigate impacts to wildlife, including, but not limited to: threatened or endangered species such as North Atlantic right whales, coastal and marine habitats; natural resources; ecosystems; and traditional or existing water-dependent uses, including, but not limited to, commercial and recreational fishing. The plan shall include pre-construction and post-construction monitoring to understand the effects of facilities on marine and avian species.

(n) The office of coastal zone management established in section 4A of chapter 21A of the General Laws, in consultation with the environmental and fisheries working groups established in section 4A½ of said chapter 21A, shall determine how the funds required in subclause (ix) of clause 5 of subsection (d) shall be used to advance the responsible development of the offshore wind energy industry.

(o) The winning bid shall be chosen by the selection committee, which shall consider all proposals and criteria in subsection (d) when making a final decision, as well as technical advice from the electric distribution companies. The committee shall consist of the following members: the secretary of energy and environmental affairs, or their designee, who shall be the chair; the independent evaluator required by subsection (f); the secretary of the executive office of housing and economic development; 1 person appointed by the speaker of the house of representatives, who shall not be a member of the general court; and 1 person appointed by the president of the senate, who shall not be a member of the general court. No member of the selection committee shall have a financial interest in any company or affiliated company that has submitted a bid or multiple bids. The selection committee shall give preference to proposals that demonstrate benefits from: (i) the greatest economic development and employment contributions to the commonwealth, including opportunities for diversity, equity and inclusion; (ii) the avoidance, minimization and mitigation of impacts to wildlife, natural resources, ecosystems, commercial and recreational fishing and other traditional or existing water-dependent uses; (iii) resources able to guarantee firm energy delivery; (iv) energy storage, including new and existing long-duration and multi-day energy storage systems; (v) commitments to enter into long-term contracts with businesses, nonprofit organizations, a municipality or group of municipalities with an approved municipal load aggregation plan pursuant to section 134 of chapter 164 of the General Laws or other government entities directly to purchase offshore wind energy; provided, that said contracts may be in addition to the long-term contracts entered into by distribution companies under this section; and (vi) the use of a project labor agreement with the appropriate labor organization for construction, renovation, reconstruction, alteration, installation, demolition, expansion, maintenance and repair.

(p) If this section is subjected to a legal challenge, the department of public utilities may suspend the applicability of the challenged provision during the pendency of the action until a final resolution, including any appeals, is obtained and shall issue an order and take other actions as are necessary to ensure that the provisions not subject to the challenge are implemented expeditiously to achieve the public purposes of this section.

SECTION 23. (a) Notwithstanding any general or special law to the contrary, the department of energy resources shall, not later than June 1, 2022, competitively solicit and procure proposals for offshore wind energy transmission sufficient to deliver energy generation procured pursuant to subsection (b) of section 83C of chapter 169 of the acts of 2008 from designated wind energy areas for which a federal lease was issued on or after January 1, 2012, that shall be developed independent of such offshore wind energy generation; provided, that offshore wind developers, as defined in section 83B of said chapter 169 shall be permitted to submit proposals pursuant to this section; provided further, that such transmission service shall be made available for use by more than 1 wind energy generation project; and provided further, that the department shall coordinate with the department of public utilities, electric distribution companies, other New England states or entities designated by those states and ISO New England, Inc. or a successor organization, in the solicitation and procurement of proposals for offshore wind energy transmission. The department shall be permitted to select 1 proposal, multiple proposals, or no proposals.

(b) In conducting the procurement for offshore wind energy transmission, the department of energy resources shall take into consideration the total amount of transmission needed to achieve the commonwealth’s offshore wind and decarbonization goals as well as demonstrable benefits to the consumer and environment and in terms of electric system reliability and avoided upgrade costs to the existing transmission grid. The department shall consider proposals that include, but shall not be limited to, upgrading the existing grid, extending the grid closer to offshore wind locations, determining optimal landfall approaches or interconnecting between offshore substations.

(c) Not later than December 31, 2022, the department of energy resources shall submit a report to the clerks of the house of representatives and the senate and the chairs of the joint committee on telecommunications, utilities and energy, that: (1) outlines the design and conduct of the solicitation and procurement process; (2) identifies and recommends any improvements to the solicitation and procurement process; and (3) provides, in the event that the department does not choose a proposal, a comprehensive explanation of their decision, including the extent to which the department’s consideration of factors in subsection (b) played a role in said decision.

SECTION 24. (a) Notwithstanding any general or special law to the contrary, there shall be established an Offshore Wind Transmission Working Group for the purposes of providing a comprehensive cost analysis of any transmission infrastructure upgrades sufficient to deliver offshore wind energy generation procured pursuant to subsection (b) of section 83C of chapter 169 of the acts of 2008 and providing policy recommendations that may be needed to facilitate and equitably recover costs of such upgrades.

(b) The working group shall consist of 15 members or their designees: 1 of whom shall be the chair of the department of public utilities, or their designee, who shall serve as co-chair; 1 of whom shall be the commissioner of energy resources, who shall serve as co-chair; 1 of whom shall be the attorney general, or their designee; 2 of whom shall be the co-chairs of the joint committee on telecommunications, utilities, and energy, or their designees; 4 of whom shall be appointed by the governor from a list of persons submitted by the following organizations and associations: the Associated Industries of Massachusetts, Inc., the National Consumer Law Center, Inc., the Acadia Center, and the Northeast Clean Energy Council, Inc.; and 6 persons to be appointed by the governor, 2 of whom shall be representatives from the offshore wind industry, 1 of whom shall have knowledge of electricity transmission, distribution, generation and power supply, 1 of whom shall be a representative of municipal interests or a regional public entity, 2 of whom shall be representatives of Massachusetts investor-owned utilities. A vacancy on the working group shall be filled in the manner in which the original appointment was made. Members of the working group shall receive no compensation for their services. The working group may request from all state agencies such information and assistance as the task force may require.

(c) The working group shall assess and report to the general court on any necessary transmission upgrades that may be required to support the deployment of 5,600 megawatts of offshore wind by June 30, 2027 as well as additional regional offshore wind projects that may interconnect into the commonwealth. This assessment shall consider both in-state transmission upgrades as well as any regional transmission upgrades that may be necessary to accommodate the commonwealth’s offshore wind requirements and shall provide recommendations on any approvals that may be necessary by ISO New England Inc. and the Federal Energy Regulatory Commission to fund such upgrades. The assessment shall include a cost-benefit analysis to identify regulatory and legal challenges associated with streamlining tariff approvals to accommodate increased offshore wind penetration across New England. The working group shall also assess and review cost-allocation measures adopted in other jurisdictions that aim to spread transmission upgrade costs equitably among developers and across the region. The working group shall meet periodically and shall solicit technical assistance from additional electric companies, consumer organizations, as well as regional energy market participants, including the New England States Committee on Electricity, Inc.

(d) The working group shall convene its first meeting not later than September 1, 2022 and shall submit its final report, along with any recommendations for legislative or regulatory reforms not later than December 31, 2022 to the clerks of the house of representatives and the senate and the chairs of the joint committee on telecommunications, utilities and energy.

SECTION 25. Notwithstanding any general or special law to the contrary, each distribution company, as defined in section 1 of chapter 164 of the General Laws, shall, not later than December 31, 2022, file with the department of public utilities either: (i) at least 1 electric rate tariff, which addresses operational parameters, to apply to energy storage systems interconnected to their distribution network; or (ii) a notice of its intent to promptly file with the Federal Energy Regulatory Commission a wholesale distribution service rate schedule to apply to standalone energy storage systems that are interconnected to their distribution network but are transacting in New England’s wholesale electricity markets. The distribution companies shall identify the costs to the distribution network not recouped through project sponsor-funded interconnection upgrades or otherwise paid directly by the project sponsor and design rates to recoup the distribution company’s net costs in a similar manner to how they are incurred by the distribution company, without unduly impeding the participation of energy storage systems in power markets and other uses of such systems that provide benefits to the electric grid.

SECTION 26. (a) Notwithstanding any general or special law to the contrary, the department of energy resources, in consultation with the Massachusetts clean energy technology center, shall study how to optimize the deployment and utilization of both new and existing long-duration and multi-day energy storage systems in the commonwealth capable of absorbing energy, storing it for a period of time and thereafter dispatching the energy for a minimum period of 5 hours for long-duration energy storage and for a minimum period of 24 hours for multi-day energy storage and investigate the necessity, benefits and costs of requiring distribution companies, as defined in section 1 of chapter 164 of the General Laws, to jointly and competitively conduct energy storage systems solicitations and procurements of up to 4,800 gigawatt hours of stored energy from renewable generation delivered to periods of high demand each year.

(b) The goal of said energy storage systems shall be to: (i) contribute to compliance with the statewide greenhouse gas emissions limits and sublimits under chapter 21N of the General Laws, including, but not limited to, the sublimit of electric power, pursuant to section 3A of said chapter 21N; (ii) promote the integration of offshore wind energy; (iii) enable firm energy delivery from renewable energy resources during periods of low energy demand to periods of high energy demand; (iv) enhance the reliable delivery and security of electricity to consumers; and (v) minimize ratepayer costs. The study shall determine the performance of said systems under frequent deployment, barriers to deployment or utilization and incentives and programs that could facilitate their deployment or utilization. The department of energy resources shall provide recommendations to the secretary of energy and environmental affairs not later than 6 months after the effective date of this act, including numerical deployment targets for both new and existing long-duration and multi-day energy storage systems to optimize the use of these systems, which the secretary shall incorporate into the setting of numerical benchmarks for energy storage capacity pursuant to clause (xi) of section 5 of said chapter 21N. The department of energy resources shall submit said recommendations to the clerks of the house of representatives and senate and to the chairs of the joint committee on telecommunications, utilities, and energy.

(c) If the study finds it beneficial to the commonwealth, the department of energy resources shall require solicitations and procurements in accordance with the study recommendations; provided, that the procurements shall: (i) contribute to compliance with statewide greenhouse gas emissions limits and sublimits under said chapter 21N; (ii) promote the integration of offshore wind energy; (iii) transport energy from periods of low energy demand to periods of high energy demand; provided, that such transportation is coordinated with the renewable generation produced in lower demand periods under solicitations performed pursuant to subsection (b) of section 83C of chapter 169 of the acts of 2008; (iv) enhance the reliable delivery of electricity to Massachusetts consumers; and (v) minimize ratepayer costs.

(d) The department of energy resources shall promulgate regulations to implement this section, including, but not limited to, the methodology by which distribution companies shall develop solicitations pursuant to this section.

SECTION 27. Notwithstanding any general or special law to the contrary, any funds not expended prior to the effective date of this act in the Offshore Wind Energy Career Training Trust Fund established in section 14 of chapter 23J of the General Laws shall be transferred by the comptroller from said fund to the Massachusetts Offshore Wind Industry Investment Trust Fund established in section 9A of said chapter 23J.

SECTION 28. (a) Notwithstanding any general or special law to the contrary, the department of elementary and secondary education, in consultation with the executive office of labor and workforce development, shall develop and implement a pilot program for the purpose of helping students acquire academic and technical skills that will prepare them for high-skill, high-demand jobs in the commonwealth in the offshore wind industry identified pursuant to section 23 of chapter 26 of the General Laws; provided, that programming shall include jobs in the offshore wind supply chain, including, but not limited to, manufacturing, construction, assembly, shipping and operations and maintenance, and any additional credentialed programming in support of the offshore wind industry.

(b) The department shall reimburse each school district at a rate of: (i) $750 for each student in the district who earns an offshore wind industry-recognized certification for an occupation that has a high employment value or relevant industry-recognized certification that is recognized by any public institution of higher learning in the commonwealth as a basis for academic credit at such institution, and (ii) $600 for each student in the district who earns an industry-recognized certification in the offshore wind industry that does not meet the criteria of clause (i) but addresses regional demands identified by the local MassHire Workforce Board. Any school district receiving a certification award for the offshore wind industry pilot credentialing program shall allocate at least 80 per cent of any certification award to the school whose students obtained the qualifying certification; provided, that the allocation may not be used to supplant funds otherwise provided for the basic operation of the school; and provided further, that any school receiving a certification award shall use the award to support or maintain the program, including the payment of stipends for instructors and the subsidization of fees for low-income students to obtain the certification. The department shall develop the criteria necessary to carry out the offshore wind industry pilot credentialing program and may promulgate any regulations necessary to operate the pilot program.

(c) Not later than February 1, 2023, and annually thereafter, the department of elementary and secondary education shall submit an annual report on the progress of the pilot program established pursuant to subsection (a), including, but not limited to: (i) the number of public school students participating in the pilot seeking certifications for high-skill, high-demand occupations in the offshore wind industry; (ii) the number of such students participating in the pilot who are low-income, English language learners and students with disabilities; (iii) the specific types of certifications earned by students, including the number of each such certification earned; and (iv) recommendations on how to bring high-skill, high-demand credentialing programs to scale statewide, including any necessary funding considerations.

(d) Notwithstanding any general or special law to the contrary, the Massachusetts clean energy technology center shall transfer $3,000,000 from the Massachusetts Offshore Wind Industry Investment Trust Fund established under section 9A of chapter 23J of the General Laws to the department of elementary and secondary education; provided, that said funds shall also be expended by the department to reimburse school districts for initial costs incurred as a result of participation in the pilot program, including, but not limited to, the acquisition of required materials and equipment and the hiring of qualified teachers.

SECTION 29. Notwithstanding any general or special law to the contrary, the department of public utilities shall implement the requirements in subsection (a) of section 92B of chapter 164 of the General Laws within 30 days of the effective date of this act.

SECTION 30. Notwithstanding any general or special law to the contrary, the governor shall make appointments to the Grid Modernization Advisory Council established in section 92C of chapter 164 of the General Laws within 30 days of the effective date of this act.

SECTION 31. Notwithstanding any general or special law to the contrary, the office of coastal zone management shall establish an environmental working group and a fisheries working group pursuant to subsection 4A½ of chapter 21A of the General Laws by June 1, 2022.

SECTION 32. Section 14 shall take effect on July 31, 2032.