Directs the Public Utility Commission to establish a pilot program that allows each natural gas company to develop a utility-scale thermal energy network pilot project to provide heating and cooling services to customers.

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83rd OREGON LEGISLATIVE ASSEMBLY--2025 Regular Session
A-Engrossed
Senate Bill 1143
Ordered by the Senate April 14
Including Senate Amendments dated April 14
Sponsored by Senators LIEBER, SOLLMAN, Representative LEVY B, Senator SMITH DB, Representatives
ANDERSEN, MARSH; Senator PHAM K, Representatives HELM, LIVELY
SUMMARY
The following summary is not prepared by the sponsors of the measure and is not a part of the body thereof subject
to consideration by the Legislative Assembly. It is an editor’s brief statement of the essential features of the
measure. The statement includes a measure digest written in compliance with applicable readability standards.
Digest: Makes the PUC create a program to have each gas company create a thermal
energy network pilot project. Makes each gas company apply to create a pilot project. Makes
labor standards for certain covered projects. (Flesch Readability Score: 64.4).
[Digest: Makes the PUC create a program to have each gas company create a thermal energy net-
work pilot project. Makes each gas company apply to create a pilot project. (Flesch Readability Score:
65.7).]
Directs the Public Utility Commission to establish a pilot program that allows each natural gas
company to develop a utility-scale thermal energy network pilot project to provide heating and
cooling services to customers. Requires each natural gas company to file a proposal and plan to
develop a pilot project or an explanation for why the natural gas company is not submitting a pro-
posal. Identifies criteria the commission shall take into consideration in evaluating a proposal.
Establishes labor standards and reporting requirements for certain thermal energy net-
work projects.
Takes effect on the 91st day following adjournment sine die.
A BILL FOR AN ACT
Relating to thermal energy networks; and prescribing an effective date.
Be It Enacted by the People of the State of Oregon:
SECTION 1.
(1) As used in this section:
(a) “Natural gas company” means a public utility, as defined in ORS 757.005, that provides
natural gas services to customers.
(b) “Thermal energy network” means a network of pipes and heat pumps that uses
noncombustible fluids within the network to distribute thermal energy between and among
ground, air and surface water sources and buildings connected to the network.
(c) “Thermal energy network pilot project” includes all real estate, fixtures and personal
property used for or in connection with developing or operating a thermal energy network.
(2) The Public Utility Commission shall establish a pilot program that allows each natural
gas company to develop a utility-scale thermal energy network pilot project to provide
heating and cooling services to customers. The purpose of the pilot program is to:
(a) Demonstrate the use and effectiveness of thermal energy networks to provide heating
and cooling services while reducing or eliminating greenhouse gas emissions or improving
energy efficiency;
(b) Allow each natural gas company to gain experience with using thermal energy net-
works to provide heating and cooling services to customers; and
(c) Provide the commission with experience on how to integrate thermal energy networks
NOTE: Matter in boldfaced type in an amended section is new; matter [ italic and bracketed] is existing law to be omitted.
New sections are in boldfaced type.
LC 1536
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and thermal energy network projects into the commission’s regulatory processes.
(3) The commission shall direct each natural gas company to file within 24 months from
the effective date of this 2025 Act, and in a form and manner prescribed by the commission:
(a)(A) A proposal to develop and operate a utility-scale thermal energy network pilot
project that serves customers; and
(B) A plan, for acceptance by the commission, for measuring the effectiveness of the
thermal energy network pilot project. The plan must include specific metrics that the na-
tural gas company proposes to use to evaluate the pilot project; or
(b) An explanation for why the natural gas company is not submitting a proposal for a
thermal energy network pilot project.
(4) The commission shall evaluate a proposal to develop a thermal energy network pilot
project with consideration to the following criteria:
(a) Whether the proposed project serves low income and energy burdened communities;
(b) Whether the proposed project serves a mix of building types;
(c) Whether the proposed project utilizes the existing gas utility workforce, creates jobs
or uses labor agreements;
(d) The availability of local waste heat, ground heat sources and water bodies;
(e) The safety, reliability and resiliency objectives of the proposed project and whether
those objectives may be reasonably achieved;
(f) Whether the proposed project tests technical, operational and financial approaches to
achieving equitable and affordable decarbonization of buildings;
(g) Whether the proposed project leverages local and federal funding sources to offset
costs recovery from customers for costs and expenses related to developing the proposed
project;
(h) Whether the proposed project benefits the community by improving air quality, en-
ergy affordability and water conservation, avoiding or reducing electricity use or reducing
greenhouse gas emissions;
(i) Collaboration by the natural gas company with the local community, governments and
electric utility providers and regulators;
(j) Whether the proposed project will inform how thermal energy networks can help
support joint planning by natural gas and electric utility providers;
(k) Whether the proposed project will inform how thermal energy networks can reduce
overall and peak energy use;
(L) Whether the proposed project will inform how thermal energy networks can avoid
costs that might be incurred absent the thermal energy network, including infrastructure,
fuel, operations and maintenance costs; and
(m) Whether the proposed project provides learning to help the development of regu-
lations that allow and facilitate thermal energy networks.
(5) The commission shall allow a natural gas company to recover costs from all custom-
ers of the natural gas company for prudent costs or expenses related to developing and op-
erating a thermal energy network pilot project under this section.
SECTION 2.
(1) As used in this section:
(a) “Apprentice,” “apprenticeable occupation” and “training agent” have the meanings
given those terms in ORS 660.010.
(b) “Covered project” means:
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(A) A project that facilitates the construction, repair or maintenance of the development
of a thermal energy network; or
(B) A thermal energy network pilot project.
(c) “Journeyworker” has the meaning given that term in ORS 660.010.
(d) “Natural gas company” means a public utility, as defined in ORS 757.005, that provides
natural gas services to customers.
(e) “Registered apprenticeship training program” means a program, as defined in ORS
660.010.
(f) “Thermal energy network” means a network of pipes and heat pumps that uses
noncombustible fluids within the network to distribute thermal energy between and among
ground, air and surface water sources and buildings connected to the network.
(g) “Thermal energy network pilot project” means a thermal energy network pilot project
developed under section 1 of this 2025 Act.
(2) A natural gas company that operates a covered project shall require each contractor
with which the natural gas company has entered into a contract for the performance of work
on the covered project to:
(a) Ensure that the following percentages of journeyworkers who are employed to per-
form work on the covered project have completed a registered apprenticeship training pro-
gram:
(A) For a covered project initiated between January 1, 2026, and December 31, 2026, at
least 30 percent.
(B) For a covered project initiated between January 1, 2027, and December 31, 2027, at
least 45 percent.
(C) For a covered project initiated on or after January 1, 2028, at least 60 percent.
(b) Participate as a training agent in an apprenticeship program registered with the State
Apprenticeship and Training Council to provide on-the-job training opportunities for appren-
tices in apprenticeable occupations to perform work on the project.
(c) Pay wages to the journeyworkers and apprentices who perform work on the covered
project at a rate that is no less than the prevailing rate of wage that the Commissioner of
the Bureau of Labor and Industries determines under ORS 279C.815 for the trade or occu-
pation in the locality where the work is performed.
(d) Ensure all journeyworkers have completed at least 30 hours of occupational safety
and health training before commencing work on the covered project and every two years
thereafter for the duration of the project.
(e) Document and submit quarterly reports to the natural gas company demonstrating
proof of compliance with the requirements described in paragraphs (a) to (d) of this sub-
section.
(3)(a) A natural gas company shall keep and maintain records necessary to demonstrate
compliance with the requirements in this section. A natural gas company must provide re-
cords kept and maintained under this section to the Bureau of Labor and Industries upon
request.
(b) A natural gas company shall compile any proof of compliance submitted by contrac-
tors under this section with respect to the work performed on a covered project during each
calendar year and submit an annual report to the Bureau of Labor and Industries no later
than February 1 of the following year.
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SECTION 3.
Section 2 of this 2025 Act becomes operative on January 1, 2026.
SECTION 4. Section 2 of this 2025 Act applies to contracts for the performance of work
on a covered project entered into, renewed or extended on or after January 1, 2026.
SECTION 5. Section 1 of this 2025 Act is repealed on January 2, 2036.
SECTION 6. This 2025 Act takes effect on the 91st day after the date on which the 2025
regular session of the Eighty-third Legislative Assembly adjourns sine die.
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