Washington’s legislature alternates between odd-numbered years of so-called ‘long sessions’ - 105 days when legislators pass bills and write a two-year budget for the state - and even-numbered years of ‘short sessions’ when legislators have 60 days to pass legislation and amend the budget as needed.
The 2024 legislative session ended on March 7. Not only was this year a short session, which limited how many bills the legislature could consider and pass, it was also Governor Jay Inslee’s final legislative session as he announced last May that he will not seek re-election in November.
Under Governor Inslee’s leadership and with Democratic leadership in the state chambers, Washington has passed and implemented numerous landmark climate policies. So, it came as no surprise that climate and clean energy initiatives dominated the Governor’s 2024 legislative policy and supplemental budget proposals.
The CETI team tracked the session carefully, following legislation pertaining to the clean energy transition and climate action more broadly. Here is our take on what made it across the finish line before the clock ran out.
Second time was the charm for Representative Doglio’s ‘Utility Gas Decarbonization’ bill, signed into law on March 28, 2024. HB 1589 aims to support Washington’s largest utility–Puget Sound Electric (PSE)–with meeting the Washington’s Clean Energy Transformation Act requirement of 80% non-emitting resources by 2030 and 100% clean resources by 2045.
This bill was first introduced last legislative session, and environmental and clean energy advocates opposed its inclusion of a ‘50/50 mandate,’ which would have ensured PSE ownership of half of all Washington’s future clean electricity market. While the 50/50 mandate was removed this session and the bill had wider support from advocates, an analysis by the Sightline Institute posits that the final legislation leaves PSE with too many carrots and not enough sticks to achieve decarbonization, and that it doesn’t offer ratepayers—especially low-income customers—enough protections from footing the bill for the utility’s transition off fossil fuels.
There was a big push to pass this bill in Inslee’s last term, and while it falls short of being the full gas ban that some advocates called for nor does it change PSE’s obligation to serve natural gas to its customers, the bill does set PSE on a path to achieve decarbonization and cost-effective electrification with a combination of planning requirements, decarbonization programs, and regulatory tools. There is a lot in this bill, so here are just some highlights:
There is also opposition to this bill from other legislators and industry groups - several ballot initiatives have been submitted by Rep. Jim Walsh (R-LD 9) and Ashli Tagoai (General Counsel to the Building Industry Association of WA) that would partially or completely repeal the bill, although they have not yet garnered the signatures needed to appear on the ballot in November.
With the passage of HB 1368, Washington has committed to transition its over 10,000 school buses from diesel to electric, which will not only reduce greenhouse gas emissions but also limit the amount of harmful pollutants getting into kids’ lungs, who breathe 50 percent more air per pound of body weight than adults.
School districts are reimbursed for bus purchases through a depreciation schedule by the Office of the Superintendent of Public Instruction (OPSI). The amended version of HB 1368 signed by the Governor stipulates that once the cost of owning and operating zero-emissions buses drops below the cost of fuel-dependent buses, school districts and bus contractors will only receive reimbursements under the OSPI's depreciation schedule for zero-emissions buses and that all new buses purchased must be zero-emissions.
Additionally, the legislature allocated $50 million to the Department of Ecology to manage a Zero-Emission School Bus Grant Program for buses, infrastructure, and other related costs, with funding priority given to replacing the dirtiest buses and supporting districts most impacted by air pollution in the transition.
Buy Clean and Buy Fair policies promote using building materials with high environmental and labor standards for public construction. CETI wrote about Washington’s Buy Clean, Buy Fair efforts in 2022 ahead of our Clean Materials Manufacturing Summit.
The Washington legislature had considered many iterations of this legislation since Representative Doglio first introduced HB 2412 in 2018. In 2021, the legislature commissioned the Carbon Leadership Forum to conduct a study evaluating the feasibility of Buy Clean, Buy Fair data reporting requirements and to make recommendations for improvements in future programs.
This year, Representative Duerr reintroduced the Buy Clean, Buy Fair Act, and it was signed into law by Governor Inslee on March 28. The bill requires construction contractors for covered state-owned projects to report and track the upstream emissions of building materials as well as working conditions for all employees at the actual production facilities. Covered products under this legislation include certain structural concrete products, reinforcing steel products, structural steel products, and engineered wood products.
The bill also establishes a technical work group to identify opportunities and barriers for using and producing low-carbon materials, promoting high labor standards in manufacturing, and preserving and expanding low-carbon material manufacturing in Washington.
According to the BlueGreen Alliance, this legislation will “promote transparency around public spending and move toward leveraging state spending to cut embodied carbon and promote high-labor standards in manufacturing.”
Achieving a clean energy transition at the scale and pace that the climate crisis requires necessitates a rapid expansion of clean energy generation, transmission, and distribution networks. However, permitting and siting challenges across the country are holding up this process.
Washington has been working on this issue for years, and HB 2039 aims to address a piece of the puzzle by modifying the appeals process for environmental and land-use matters in the state. In particular, the bill attempts to streamline the appeals process for permits related to certain clean energy projects by consolidating appeals related to the same project.
In 2021, Washington passed the Climate Commitment Act, which developed a comprehensive, market-based cap-and-invest program to reduce carbon pollution and achieve the state’s emissions reduction targets.
SB 6058 is a Department of Ecology-requested bill that would facilitate the linkage of Washington’s carbon market with the joint cap-and-trade system operated between California and Québec. While this legislation does not actually link the markets, it makes future linkage possible by aligning Washington's compliance periods and allowance purchase limits with the California-Québec Market.
The actual joining of these markets wouldn’t happen until 2025 at the earliest and is contingent upon California and Québec making their own decisions on whether they would join forces with Washington. The bill also requires a public comment period and analysis to ensure that Washington’s program would still prioritize support for overburdened communities and achieve the state’s emissions reduction targets in a linked market.
If linkage is pursued, all three jurisdictions would pool their supply of emissions allowances and conduct shared auctions. This could lead to more aggressive emissions reductions, reduce the cost of compliance for Washington companies by bringing down the price of allowances, and improve the overall stability of the market.
The Energy Independence Act (Initiative 937) passed in 2006 and requires large electric utilities, who serve 25,000 or more customers, to meet targets for energy conservation and use eligible renewable resources. A utility’s load determines the amount of eligible renewable resources or equivalent renewable energy credits they must use to meet annual targets.
HB 1948 clarifies that a qualifying utility’s load does not include kilowatt hours delivered to the system from a retail electric customer’s voluntary purchase of eligible renewable energy resources. This bill, requested by Seattle City Light, will help ensure that methods for calculating the electric load of utilities under the Energy Independence Act do not discourage voluntary investments in renewable power.
Geothermal electricity generation harnesses heat within the earth’s crust to produce electricity. The U.S. has more geothermal electricity-generating capacity than any other country in the world at around 4 gigawatts. Washington currently uses very little geothermal energy, mostly for heating buildings in central and eastern Washington.
SB 6039 promotes geothermal energy development in the state by directing the Department of Natural Resources (DNR) to compile and maintain a publicly available database as part of the Washington Geologic Survey that includes geologic information relevant to geothermal development.
It also requires DNR to update its geothermal resources lease rates to optimize geothermal exploration and development projects while respecting federally reserved Tribal rights and resources; directs the Department of Commerce to establish a competitive geothermal exploration grant program to offset costs associated with exploratory drilling; and requires a collaborative process among state agencies, Tribal governments, and other stakeholders to identify the opportunities and risks associated with geothermal development in the state.
Distributed energy resources (DER) and microgrids may be key to ensuring resilience and reliability in the energy grid. DERs produce and supply electricity on a small scale, are spread out over a wide area, and can include solar panels, backup batteries, and emergency generators. Solar DERs, in particular, can be built at many scales, and small-scale solar is responsible for one-third of solar energy generation in the US, according to the US Department of Energy.
HB 2156 addresses the need for industry standards around small-scale solar distribution to protect consumers by requiring a professional license to install, repair, or design solar systems valued over $1,000 and mandating more transparency and clarity in solar contracts.
Thermal Energy Networks (TEN) are shared networks of water pipes that transfer heat in and out of buildings to provide efficient, affordable, and climate-friendly heating and cooling to entire neighborhoods. These systems harness the exchange of heat from a variety of sources–lakes and rivers to energy-intensive buildings, wastewater systems, and the Earth’s core–to deliver reliable energy to communities.
Representative Ramel’s HB 2131 promotes the establishment of thermal energy networks in Washington by developing a Thermal Energy Network Pilot Project Program that directs the UTC to approve TEN pilot projects and Commerce to award grants to fossil gas utilities to study the potential of the networks. The legislation also stipulates that TENs may fulfill a utility’s ‘obligation to serve’ and be merged into a single rate base plan with a utility’s gas operations upon approval by the UTC.
Although this was a ‘non budget’ year, the Legislature passed a supplemental budget and made many other allocations that support climate and clean energy related work. Several stood out to us:
You can explore more budget investments here.
Washington’s Climate Commitment Act (CCA) is a critical source of funding for on-the-ground solutions to the climate crisis that will benefit vulnerable communities through its cap-and-invest program that came into effect in January of 2023 and is designed to cut climate pollution while raising funds from polluters. It has already raised over $3 billion through the auction of pollution allowances, which have been allocated in the 2023-2025 Biennial Budget to support protections for climate, clean air, and clean water that will directly benefit communities.
Of that $3 billion in CCA funds, approximately $1 billion were allocated in the 2024 legislative session to fund important climate policies. However, many of those investments are contingent on the outcome of Initiative 2117, which would repeal the CCA and will be on the ballot in November.
This initiative left legislators cautious about passing bills that would receive CCA funding or be contingent upon the CCA continuing to exist and also about allocating the revenue generated since the biennium budget was passed last year due to legal concerns that action could be interpreted as a legislative response to Initiative 2117. As a result, there are clauses in some CCA-related legislation and budget allocations that would make them ‘null and void’ if the initiative were to succeed in November.
The latest cap-and-invest auction took place last month and generated another $135 million in revenue, which will be invested into Washington communities to enhance climate resilience, create jobs, and improve air quality. If I-2117 is successful and the CCA is repealed, it could leave a $1.3B hole in the current state budget and would prevent the legislature from passing any similar legislation for several years.
As the state of Washington has committed to meeting stringent emissions reduction targets and climate goals over the next few decades, it would need to turn elsewhere to find the substantial sources of funding needed to resource ongoing and future work to address climate change and achieve an equitable clean energy transition.
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