Utility-Scale Battery Storage Rqmts.

GENERAL ASSEMBLY OF NORTH CAROLINA
SESSION 2025
S 1
SENATE BILL 728

Short Title: Utility-Scale Battery Storage Rqmts. (Public)
Sponsors: Senator Jarvis (Primary Sponsor).
Referred to: Rules and Operations of the Senate
March 26, 2025
*S728-v-1*
A BILL TO BE ENTITLED 1
AN ACT TO REQUIRE A PERMIT FOR UTILITY-SCALE BATTERY ENERGY STORAGE 2
SYSTEMS, AND TO REQU IRE SUCH SYSTEMS TO RESPONSIBLY 3
DECOMMISSION UPON CE SSATION OF ACTIVITIE S, MAINTAIN FINANCIA L 4
RESPONSIBILITY FOR T HAT PURPOSE, AND TO FILE EMERGENCY RESPONSE 5
AND DECOMMISSIONING PLANS WITH THE DEPAR TMENT OF 6
ENVIRONMENTAL QUALITY. 7
The General Assembly of North Carolina enacts: 8
SECTION 1. Part 2J of Article 9 of Chapter 130A reads as rewritten: 9
"Part 2J. Management of Solar Clean Energy Equipment. 10
"Subpart 1. Solar Energy Equipment. 11
"§ 130A -309.240. Decommissioning and restoration requirements for utility -scale solar 12
projects; recycling of project components required; financial assurance 13
requirements. 14
… 15
"§ 130A-309.243. Enforcement and appeals. 16
…. " 17
SECTION 2. Part 2J of Article 9 of Chapter 130A of the General Statutes is amended 18
by adding a new Subpart: 19
"Subpart 2. Utility-Scale Battery Energy Storage. 20
"§ 130A -309.250 Permitting, emergency response planning, decommissioning and 21
restoration, and financial assurance requirements for utility -scale battery 22
energy storage systems. 23
(a) Definitions. – For purposes of this Part, the following definitions apply: 24
(1) Energy storage. – Any technology that is capable of absorbing electricity, 25
storing the electricity for a period of time, and redelivering the electricity. 26
(2) Battery energy storage system. – Electrochemical devices that charge, or 27
collect, energy from the grid or a generat ion facility, store that energy, and 28
then discharge that energy at a later time to provide electricity or other grid 29
services. 30
(3) Utility-scale battery energy storage system. – Battery energy storage systems 31
with a rated nameplate capacity of equal to or greater than 1,000 kilowatts (1 32
megawatt). 33
(b) Permit Required. – No person may install or operate utility -scale battery energy 34
storage system in the State without first having obtained a permit from the Department of 35
Environmental Quality pursuant to th is section. The Department shall hold at least one public 36
General Assembly Of North Carolina Session 2025
Page 2 Senate Bill 728-First Edition
meeting on a permit application in the county in which the battery energy storage system is 1
proposed to be located. In order to obtain a permit pursuant to this section, the owner of a 2
proposed system shall submit all of the following to the Commission: 3
(1) A description of the location of the proposed system. 4
(2) A description of the type of battery energy storage equipment to be used at the 5
proposed system. 6
(3) A statement identifying the fire department and law enforcement entities that 7
may reasonably be expected to be the primary first responder s to a fire at the 8
location of the battery energy storage system. 9
(4) An Emergency Response Plan as required by subsection (c) of this section. 10
(5) A Decommissioning Plan as required by subsection (d) of this section. 11
(6) Documentation of financial assurance as required by subsection (e) of this 12
section. 13
(c) Emergency Response Plan. – The owner of a utility -scale battery energy storage 14
system located in the State shall develop and maintain an emergency response and evacuation 15
plan that covers the premises of the system, which shall be submitted to the Department of 16
Environmental Quality. In developing the pla n, the owner of a battery energy storage system 17
shall coordinate with local emergency management officials. The emergency response and 18
evacuation plan shall do all of the following: 19
(1) Establish response procedures for an equipment malfunction or failure. 20
(2) Include procedures that provide for the safety of surrounding residents, 21
neighboring properties, emergency responders, and the environment. 22
(3) Establish notification, communication, and coordination procedures between 23
the battery energy storage system and local emergency management officials. 24
(4) Consider actions to be taken to address potential offsite impacts, including 25
poor air quality, and threats to municipal water supplies and surface and 26
groundwater sources. 27
(5) Include procedures for establi shing shelter-in-place orders and road closure 28
notifications when appropriate. 29
(d) Decommissioning Requirement, Plan, and Financial Assurance. – 30
(1) The owner of a utility-scale battery energy storage system shall be responsible 31
for proper decommissioning of the system upon cessation of operations and 32
restoration of the property in compliance with subdivision (3) of this 33
subsection, including all costs associated therewith, no later than one year 34
following ces sation of operations. The owner shall notify the Department 35
within 30 days of cessation of operations, which notice shall include a detailed 36
description of the steps to be taken to properly decommission the system and 37
for restoration of the site. At a mini mum, an owner shall take all of the 38
following steps in decommissioning a system: 39
a. Disconnect the utility scale battery energy storage system from the 40
power grid. 41
b. Remove all equipment from the battery energy storage system, and 42
collect and ship equipment for reuse, or recycle all of the components 43
thereof practicably capable of being recycled, including energy 44
storage system batteries ; aboveground electrical interconnection and 45
distribution cables that are no longer deemed necessary; subsurface 46
cable no longer deemed necessary; any metal fencing; and electrical 47
and electronic devices, including transformers and inverters. 48
Components that will not be shipped for reuse, are incapable of being 49
recycled, and do not meet the definition of hazardous waste shall be 50
properly disposed of in (i) an industrial landfill or (ii) a municipal solid 51
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Senate Bill 728-First Edition Page 3
waste landfill. Energy storage system batteries that meet the definition 1
of a hazardous waste shall comply with hazardous waste requirements 2
for recycling and disposal as applicable. 3
c. Restore the property (i) as nearly as practicable to its condition before 4
the battery energy storage system was sited or (ii) to an alternative 5
condition agreed upon in a written contract or lease agreement 6
between the landowner and the system owner. A copy of the 7
agreement signed by both parties shall be provided to the Department 8
prior to decommissioning. The condition of the property shall 9
otherwise comply with any applicable statutory requirements, rules 10
adopted thereunder, and requirements in local ordinance. Land that 11
was cleared of tree s for the battery energy storage system may be 12
revegetated or reforested with seedlings. 13
(2) The owner of a utility -scale battery energy storage system shall submit a 14
decommissioning plan to the Department for approval, which shall be 15
prepared, signed, and sealed by a professional engineer licensed in the State 16
and shall contain all of the following information: 17
a. The name, address, and contact information for the owner of the 18
system, and name, address, and contact information for the landowner 19
of the property on which the system is to be located sited, if different 20
than the owner. 21
b. A narrative description of how the decommissioning will be 22
conducted, including the decommissioning s equencing; the 23
disposition of materials to be used upon decommissioning, such as 24
landfilling, reuse, or recycling of system equipment, which shall 25
specifically delineate methods to be used for solid and hazardous 26
waste; and a schedule for completion of the decommissioning 27
activities. 28
c. Information on equipment proposed to be salvaged, including 29
estimated salvage value of the equipment for the purpose of 30
determining financial assurance. 31
d. Information on steps to be taken to restore the property in compliance 32
with subdivision (1) of this subsection. 33
e. A cost estimate for decommissioning the system and restoration of the 34
property in compliance with subdivision (1) of this subsection. 35
f. The proposed mechanism to satisfy the financial assurance 36
requirements established under subdivision (3) of this subsection, 37
including information on which legal entity will establish the 38
mechanism, when it will be established in accordance with the 39
requirements of this section, and how the Department will access the 40
funds from the mechanism if needed. 41
(3) The owner of a utility -scale battery energy storage system shall establish 42
financial assurance in an amount acceptable to the Department that will ensure 43
that sufficient funds are available for decommissioning of the system and 44
restoration of the property in compliance with subdivision ( 1) of this 45
subsection, even if the owner becomes insolvent or ceases to reside in, be 46
incorporated, do business, or maint ain assets in the State. To establish 47
sufficient availability of funds under this section, the owner of a battery energy 48
storage system may use insurance, financial tests, third party guarantees by 49
persons who can pass the financial test, guarantees by cor porate parents who 50
can pass the financial test, irrevocable letters of credit, trusts, surety bonds, or 51
General Assembly Of North Carolina Session 2025
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any other financial device, or any combination of the foregoing, shown to 1
provide protection equivalent to the financial protection that would be 2
provided by insurance if insurance were the only mechanism used. Financial 3
assurance shall be established by an owner of a battery energy storage system 4
and maintained until such time as the system is decommissioned and 5
restoration of the property has been completed in compliance with this section. 6
Documentation of financial assurance established shall be submitted to the 7
Department at the time a permit application is submitted pursuant to 8
subsection (b) of this section. 9
(h) Fees. – The Department shall collect fees from the owner of a utility -scale battery 10
energy storage system subject to the requirements of this section at the time a permit application 11
is submitted pursuant to subsection (b) of this section. Fees collected under this subsection shall 12
be applied to the Department's cost of administering the program. 13
(i) Department Report. – Information regarding implementation of the requirements of 14
this section shall be included in the annual report required under G.S. 130A-309.06(c). 15
(j) Rules Required. – The Department of Environmental Quality shall adopt rules 16
establishing criteria for all of the following: 17
(1) Siting requirements for utility-scale battery energy storage systems to 18
reasonably ensure that: (i) a proposed system is sited at sufficient distance 19
from other battery energy storage systems in order to mitigate the risk of fire 20
at a system, or the spread of a fire between systems; (ii) in the event of a fire 21
at the system, the fire will not block the only access point to a residential area. 22
(2) Set the amount of financial assurance required for utility-scale battery energy 23
storage systems as set forth in subsection (d) of this section. These rules shall 24
consider, at a minimu m, the battery storage technology to be employed; the 25
approximate number and size of batteries to be located at the system; any 26
ancillary facilities to constructed in association with the system; the condition 27
of the property prior to construction of a battery energy storage system; the 28
amount of acreage that would be impacted by the proposed system; and any 29
other factors designed to enable establishment of adequate financial assurance 30
for decommissioning and restoration on a site -by-site basis. In estab lishing 31
requirements for financial assurance for a battery energy storage system, the 32
Department shall consider the salvage value of the system's equipment. The 33
rules shall require periodic updates to be provided by owners with respect to 34
financial assurance maintained. In addition, the Department shall adopt rules 35
as necessary to implement other requirements of this section, including rules 36
to address the following matters: 37
(3) Requirements for decommissioning plans, including required information, 38
and processes for submittal and review of plans. 39
(4) Permit fees to be assessed. 40
(5) Any other matter the Department deems necessary. 41
"§ 130A-309.251. Utility-Scale Battery Energy Storage Management Fund. 42
(a) Creation. – The Utility-Scale Battery Energy Management Fund is created as a special 43
fund within the Department. The Fund consists of revenue credited to the Fund from the proceeds 44
of the fee imposed on owners of utility -scale battery energy s torage systems under 45
G.S. 130A-309.250. 46
(b) Use and Distri bution. – Moneys in the Fund shall be used by the Department to 47
implement the provisions of this Subpart concerning proper decommissioning of utility -scale 48
battery energy storage facilities. 49
"§ 130A-309.252. Enforcement and appeals. 50
(a) This Subpart may be enforced as provided by Part 2 of Article 1 of this Chapter. 51
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(b) Appeals concerning the enforcement of rules, the imposition of administrative 1
penalties, or any other action taken by the Department under authority of this Subpart shall be 2
governed by the provisions for appeals set forth in Part 2 of Article 1 of this Chapter." 3
SECTION 3. This act is effective when it becomes law, and applies to utility -scale 4
battery energy storage systems for which construction is commenced on or after that date. 5