A cross-agency effort will slash greenhouse gas emissions, improve air quality, increase strategic growth and transit accessibility, and make the state more climate-resilient
Denver - Monday, Jun. 10, 2024 - Governor Polis recently signed into law a series of bills passed by the Colorado legislature that build on the state’s commitment to addressing climate issues through cutting greenhouse gas emissions, creating an equitable transition to a low-carbon economy, and ensuring Colorado’s natural resources are secure in the face of climate change.
The Colorado Energy Office (CEO), the Colorado Department of Public Health and Environment (CDPHE), the Colorado Department of Transportation (CDOT), the Colorado Department of Agriculture (CDA), and the Department of Natural Resources (DNR) will be responsible for implementing many of these new laws.
These new laws cover a wide range of sectors and issues, including strategic growth, land use, housing, public transit, electric vehicle charging infrastructure, electric grid readiness, carbon management, renewable energy, air quality, a just transition for communities transitioning from fossil fuel production, agriculture, and water security.
“Over the past few years, both the Governor and our legislature have worked hard to prioritize developing key policies that can ensure that Colorado makes the transition to affordable clean energy,” said Colorado Energy Office Executive Director Will Toor. “This year’s slate of new laws goes a long way to setting in motion practical steps to implement these important policies. Our elected officials deserve a lot of praise for taking these next important actions.”
These new laws come just months after the state released its new Greenhouse Gas (GHG) Pollution Reduction Roadmap. “Roadmap 2.0” is an update of the original 2021 version. It shows that without any new rules or laws beyond what is already underway as of the fall 2023, Colorado is projected to be more than 80% of the way to meeting its statutory goal of a 50% emissions reduction in 2030 from 2005 levels. In addition, as part of this Roadmap, the state is committing to 49 additional Near Term Actions that will drive additional emissions reductions in every sector. These new laws address a number of the Near Term Action, particularly in the areas of strategic growth and transit.
Perhaps the most significant climate-related legislation this year was the package of strategic growth-related bills that will encourage more housing to be built in cities near jobs and other daily destinations. House Bill 24-1313 will encourage the development of multifamily housing near public transit, and House Bill 24-1304 will remove costly parking mandates for residential development along transit corridors.
Notably, the state’s actions on transit will both unlock key federal funding and further transit activity already in action. Highlights include Senate Bill 24-184, which imposes a fee on rental cars so that out-of-state visitors who contribute to wear and tear and congestion on Colorado's roads help pay for transportation, and Senate Bill 24-230, which imposes a fee on oil and gas production to offset oil and gas pollution by investing in public transit. That fee revenue will also help provide seed funding for the Front Range Passenger Rail project from Pueblo to Fort Collins and mountain rail from Denver to Craig. Additionally, the new transit revenue will help expand CDOT's growing Bustang network of intercity bus service and provide funding to transit agencies across the state.
"The legislature and Governor's bold steps on transit funding will allow Colorado to take advantage of tens of billions of dollars in new federal resources specifically for rail – dollars that would either come to Colorado or go to other places like California and Texas," said Shoshana Lew, executive director of the Colorado Department of Transportation. "If we win them for Colorado, we have the unique opportunity to create a transit spine both north to south and east to west throughout the state. Overall, the funds being invested in transit are going to pay dividends for many decades to come in the form of increased transportation options for Coloradans and the economic development that will accompany a robust multimodal network.”
Protecting Coloradans’ health and bolstering the state’s climate resiliency were also key takeaways from this legislative session.
“Colorado continues to lead the nation in environmental protection and climate resilience, and these laws will help us build on our progress,” said Jill Hunsaker Ryan, executive director of the Colorado Department of Public Health and Environment. “By tackling ozone pollution, reducing greenhouse gas emissions, advancing environmental justice, and protecting our water systems, we’re creating a healthier state for all.”
The Polis administration and the legislature also continued to work tirelessly this session to address the impacts of the oil and gas industry. Elected officials and stakeholders found important common ground that will play a key role in meeting our climate goals and ensuring that the state’s energy needs are met in the short- and long-term.
“This Colorado legislative session, with the leadership of Governor Polis, saw key new investments and policies to help protect our natural resources and plan for a future impacted by climate change,” said Dan Gibbs, Executive Director of the Colorado Department of Natural Resources. “This includes priorities for the 21st century by paving the way to oversee underground carbon storage, utilize geothermal sources for heat and power, boost efforts to improve forest health and reduce wildfire risk and invest in securing water supplies and water conservation measures. The Department of Natural Resources is proud to work with our sister agencies towards healthier forests and watersheds, a cleaner energy portfolio, and water projects that benefit our communities and wildlife.”
In addition, these new laws will help protect the state’s natural environment and essential water resources, which are important to both urban and rural Coloradans.
“Funding for the Agricultural Drought and Climate Resilience Office will be used to accelerate renewable energy generation in Colorado’s rural communities while helping to support a variety of on-farm resilience practices,” said Colorado Commissioner of Agriculture Kate Greenberg. “Colorado’s farmers and ranchers are key players in the response to a changing climate and the newly approved Agricultural Stewardship tax credit will provide financial incentives to help producers invest into agricultural resilience projects.”
The following is a summary of the newly adopted legislation that CEO, CDPHE, CDOT, DNR, and CDA, among other agencies, will play a role in implementing:
Strategic Growth and Transportation
House Bill 24-1007 Prohibit Residential Occupancy Limits: Prevents local governments from enacting or enforcing residential occupancy limits based on familial relationship while allowing local governments to implement residential occupancy limits based on demonstrated health and safety standards such as international building code standards, fire code regulations, or CDPHE wastewater and water quality standards. As a result, this law should increase housing opportunities for Coloradans throughout the state and will decrease energy and water use by allowing more people to share existing homes.
House Bill 24-1036 Adjusting Certain Tax Expenditures: Extends the ecopass tax credit through 2026 for employers offering ecopasses to their employees (among many other changes to the tax code not related to climate issues). Ecopasses are fare free public transit access passes.
House Bill 24-1116 Extend Contaminated Land Income Tax Credit: Focuses on helping residents and businesses redevelop contaminated land and improve housing and economic opportunities by extending the Brownfields Tax Credit for five years. Qualified applicants who submit a voluntary cleanup plan may claim the tax credit for a portion of the cost of performing environmental remediation of contaminated land associated with new capital improvement or redevelopment projects.
House Bill 24-1152 Accessory Dwelling Units: Allows owners of single-family homes in many parts of Colorado to build accessory dwelling units. These smaller living areas, which can be part of an existing building or a new structure, are useful for increasing housing availability and density while using already existing infrastructure for water, sewers, and roads. By June 30, 2025, certain jurisdictions will need to update their codes to allow these units, including municipalities with a population of 1,000 or more within the area of a metropolitan planning organization. Jurisdictions that are a portion of a county that is both within a census designated place with a population of 40,000 or more and within the area of a metropolitan planning organization are also covered by this law. With limited exceptions, the bill prohibits parking mandates for ADUs and ongoing owner occupancy requirements. The bill also contains a grant program and financing to support ADU production with a focus on low and moderate-income homeowners and renters. Jurisdictions that are exempt from the ADU requirements in the law may opt into the requirements to access these grants and financing opportunities. Because ADUs are smaller units, and will create more housing opportunities near jobs, this bill will reduce both building and transportation energy use.
House Bill 24-1173 Electric Vehicle Charging System Permits: Takes a step toward improving EV charging station permitting timelines and increasing the rate at which new charging stations are installed in Colorado. This bill directs CEO to develop a model code for EV charging station permitting based on national best practices and from feedback in a stakeholder process. This also expands the usage of the EV Grant fund to be used for technical support and training for local governments to adopt the model code. Additionally, it will provide data from local governments on EV charging permitting timelines to better understand where challenges are occurring.
House Bill 24-1304 Minimum Parking Requirements: Starting June 30, 2025, prevents cities and counties in Metropolitan Planning Organizations (MPOs) from enforcing or adopting minimum parking requirements for multifamily residential, residential adaptive reuse projects, and mixed-use projects with at least 50% residential uses that are located within a quarter-mile of rail and bus stations with service at least every 30-minutes. The state will create a map of applicable transit areas by September 30, 2024, based on the most recent transit service plans adopted prior to January 1, 2024. Lowering parking requirements reduces the cost of building new multifamily housing, increases the number of homes that can be built, and facilitates infill development where parking requirements prevented development in the past. Eliminating parking minimums has also been shown to reduce greenhouse gas pollution by decreasing the number of vehicle miles traveled.
House Bill 24-1313 Housing in Transit-Oriented Communities: Establishes Housing Opportunity Goals for local governments with rail, bus rapid transit, or frequent bus service to increase the number of homes that can be built near transit and city and town centers. The Housing Opportunity Goal is a zoning capacity target based on a formula that includes the amount of qualifying transit each community has, a housing density level that’s needed to support transit ridership and affordable housing development, and exemptions that exclude undevelopable land. To meet their Housing Opportunity Goal, local governments have flexibility to identify the areas closest to bus stops, train stations, and business and shopping districts where it makes sense for people to live and work, as long as these areas combined meet the Housing Opportunity Goal. Local governments are legally required to meet their Housing Opportunity Goal; those that meet it will also qualify for a new Transit-Oriented Communities Infrastructure Fund, and a new state Affordable Housing Tax Credit, created by House Bill 24-1434.
House Bill 24-1434 Expand Affordable Housing Tax Credit: Among other aspects of this housing bill are tax credits for transit-oriented housing, which is a key aspect of strategic growth. Transit-oriented housing lowers driving miles, which is a key part of an overall climate plan.
Senate Bill 24-032 Methods to Increase the Use of Transit: Creates the Zero Fare Transit Fund and appropriates $10 million to fund the existing Ozone Season Transit Grant program and the new year-round Zero Fare for Youth program. The Fund will provide eligible transit agencies around the state with funding to offer free fares during summer ozone season months, and/or for the new year-round Zero Fare for Youth program. This bill also creates the statewide transit pass exploratory committee within CDOT to develop a viable proposal for the creation, implementation, and administration of a statewide transit pass.
Senate Bill 24-174 Sustainable Affordable Housing Assistance: Requires the Colorado Department of Local Affairs (DOLA) to develop reasonable methodologies to conduct statewide, regional, and local housing needs assessments and provide guidance for local government to identify areas at elevated risk of displacement. This must be done no later than December 31, 2024. Then, no later than November 30, 2027, and every six years after, DOLA must conduct a statewide housing needs assessment analyzing existing and future statewide housing needs and publish a report that quantifies current housing stock and estimates statewide housing needs. The law also DOLA to evaluate the impacts of urban sprawl and report back to the legislature with policy options by October 31, 2025.
Senate Bill 24-184 Support Surface Transportation Infrastructure Development: Creates a dedicated funding source for rail and transit through the Colorado Transportation Investment Office (CTIO). The law also encourages regional coordination between RTD, Front Range Passenger Rail, and CDOT to explore opportunities to establish train service from Denver to Fort Collins. In addition, it directs CTIO to develop a multimodal plan that aligns with the 10-year transportation plan and statewide greenhouse gas pollution reduction goals. The bill also expands CTIO's capacity to execute mandated responsibilities and more explicitly prioritize mitigation of traffic congestion and traffic-related pollution through the completion of multimodal surface transportation infrastructure projects. It also authorizes RTD to extend operations of the Northwest Rail Fixed Guideway Corridor, including an extension of the corridor to Fort Collins.
Senate Bill 24-230 Oil and Gas Productions Fees: Imposes a production fee to be paid quarterly by every producer of oil and gas in the state. Eighty percent of the proceeds will be used for public transit, and 20% for wildlife conservation. This is expected to generate more than $100 million/year for public transit.
Environment, climate, and air quality (broadly)
House Bill 24-1449 Environmental Sustainability Circular Economy: Enhances the state’s work to advance sustainability across Colorado. The Colorado Circular Communities Enterprise will build out Colorado’s circular economy through work that prevents materials from going to landfills, creates transportation networks, funds manufacturers to come to Colorado, and creates markets for products made from recycled and upcycled materials. The new enterprise will also support regional public-private partnerships and provide grants, funding, and technical assistance to local governments, businesses, schools, and higher education institutions. The bill also makes permanent the sustainability coaching, technical assistance, and recognition services that CDPHE’s Colorado Green Business Program provides.
Senate Bill 24-014 Seal of Climate Literacy Diploma Endorsement: Authorizes a school district, board of cooperative services, district charter high school, institute charter high school, or the Colorado school for the deaf and the blind to grant a high school diploma endorsement in climate literacy (seal of climate literacy) to graduating students who demonstrate mastery in climate literacy and attain green skills or technical green skills.
Senate Bill 24-214 Implement State Climate Goals: Establishes an Office of Sustainability in the Department of Personnel and Administration with a concerted focus on greening state government and maximizing the use of federal tax credits available through the Inflation Reduction Act. Greening state government practices range from coordinating electric vehicle charging infrastructure to electrifying gas-powered lawn equipment. The bill creates a state agency sustainability revolving fund and the Inflation Reduction Act elective pay cash fund to allow state agencies to take advantage of the clean energy tax credit direct pay provision in the Inflation Reduction Act. The bill requires state projects and projects receiving state grant funding to use EPA Energy Star certified equipment. In addition, the bill makes several changes to more effectively implement existing state policies, including two landmark bills passed in 2023 – House Bill 23-1272 and House Bill 23-1281. Through these bills, Colorado now provides a number of innovative state tax credits to support clean energy technology adoption. The proposed changes in this bill will allow these programs to run more efficiently and as originally intended. The bill also directs the Colorado Energy Office to study the feasibility of a statewide standard requiring 2-way air conditioning (heat pumps) for residential air conditioning and report back to the legislature.
Senate Bill 24-229 Ozone Mitigation Measures: Aims to protect clean air and reduce ozone pollution by requiring CDPHE to propose rules to the Air Quality Control Commission to reduce nitrogen oxide (NOx) emissions that oil and gas operations generate by 50% by 2030 relative to 2017 levels. The legislation requires the Air Pollution Control Division to publish an annual report of its statewide enforcement actions and clarifies the division’s authority to impose penalties for violations of air toxics regulations, fenceline and community air monitoring requirements, and petroleum refinery emissions monitoring requirements. Further, the bill strengthens the state’s regulation of oil and gas emissions.
Emissions from the built environment
House Bill 24-1370 Reduce Cost of Use of Natural Gas: Requires CEO to identify up to five interested local governments to participate in a Neighborhood-Scale Alternatives Pilot Project to transition to zero-emissions thermal resources (such as geothermal) as the heat energy source for buildings. To be eligible, neighborhoods must receive both gas and electric service from a dual-fuel utility and projects must include, for example, energy service through networked geothermal heating and heat pumps instead of gas appliances. Currently, gas utilities in Colorado invest more than $500 million per year into upgrading and expanding the natural gas distribution system. These ratepayer costs, coupled with increased variability of natural gas commodity costs, are leading Colorado communities to contemplate strategies to reduce the cost of natural gas infrastructure. This bill allows interested local governments to evaluate and choose limited projects that, by deploying an alternative energy service, reduce costs for all customers and reduce local air pollution and greenhouse gas emissions through avoided natural gas use.
Carbon management
House Bill 24-1346 Energy & Carbon Management Regulation: Expands the authority of the Energy and Carbon Management Commission (ECMC) to include the regulation of activities performed for the purpose of engaging in the injection and underground sequestration of carbon dioxide in pore space (geologic storage operations). The bill defines pore space ownership and outlines how to address underground carbon storage involving multiple pore space owners. The law also provides additional enforcement abilities to the commission and charges the ECMC with evaluating the cumulative impacts from all operations it regulates in order to pave the way for the development of carbon capture in the state.
Renewable energy and utilities
Senate Bill 24-207 Access to Distributed Generation: Makes changes to the community solar gardens statute to expand access for income-qualified customers by guaranteeing 51% of gardens built after 2026 are reserved for income-qualified customers. The law also requires investor-owned electric utilities with more than 500,000 customers to make at least 50 megawatts of stand-alone community solar capacity available, and investor-owned utilities with 500,000 or fewer customers to make at least 3.5 megawatts of inclusive community solar available. The legislation also requires 50 MW of community solar capacity that is paired with storage, which increases the value of the solar gardens to the grid as a whole.
Senate Bill 24-212 Local Govs Renewable Energy Projects: Requires the Energy and Carbon Management Commission, at the request of a local government or Tribal government, to provide technical support for developing local codes governing wind, solar, energy storage, and energy transmission projects (renewable energy projects); or to review proposed renewable energy projects. The bill also requires the Colorado Energy Office to develop a repository of model codes and ordinances for renewable energy projects, which will provide local and Tribal governments with conceptual frameworks to consider and adapt to local circumstances and energy resources, and to conduct a study of local permitting for renewable energy and transmission projects.
Senate Bill 24-218 Modernize Energy Distribution Systems: Helps ensure that an investor-owned utility with more than 500,000 customers makes timely, critical, and proactive investments in the electric grid to keep up with population and economic growth and state climate goals. Proactive investment in the distribution system makes it easier and less expensive for customers to connect distributed energy resources, such as solar and EVs; lowers the cost of infill and affordable housing by reducing the cost to connect to the grid; and supports state climate and air quality goals. To ensure there is a well-trained workforce to accomplish these infrastructure improvements, the bill invests in a workforce development grant program. The bill also limits the costs that large investor-owned utilities can charge individual residential customers or multifamily affordable housing for interconnecting solar, heat pumps, or EV charging.
Just transition for workers and communities and environmental justice
House Bill 24-1338 Cumulative Impacts and Environmental Justice: Aims to ensure every Colorado community has a healthy environment by implementing the recommendations of the Environmental Justice Action Task Force that was created in House Bill 21-1266. It codifies CDPHE’s Office of Environmental Justice and requires the office to commission at least two analyses of environmental equity and cumulative impacts in certain communities in the state. The legislation requires the Air Pollution Control Division to hire a petroleum refinery expert to assess gaps in public health protection and identify the best regulatory tools to fill those gaps. It also requires refineries to upgrade their community monitoring stations to monitor for specific pollutants and report all emissions and monitoring data in near real-time to the division. Finally, the bill establishes a rapid response inspection team to respond to air quality complaints.
House Bill 24-1410 Changes to Just Transition Office: Aligns OJT’s statutory funding categories and spending timelines to better enable OJT to provide funding to coal transition communities and workers based on their identified needs and consistent with the plant and mine closure timelines. OJT’s funding was developed over three bills and 14 different appropriations clauses. The bill aligns the myriad of eligible spending categories and expenditure deadlines to ensure that the funding for community projects from one source is allowed to continue under other funding sources and to align worker transition program timelines with when workers will require support to achieve a seamless transition. This bill establishes a common funding end date of June 30, 2030.
Agriculture, water, and natural lands
House Bill 24-1024 Extend Outreach Campaigns Wildfire Risk Mitigation: Continues the Live Wildfire Ready Campaign through 2027. The Wildfire Matters Review Interim Committee initiated this bill to extend an outreach and education campaign geared toward homeowners about how best to prepare for a wildfire, which is an important resiliency strategy in the face of a persistent climate change impact. Over its first couple years, the campaign has garnered nearly 6 million impressions through radio, billboard, online, and printed ads.
House Bill 24-1249 Tax Credit Agricultural Stewardship Practices: Establishes a $3 million per year state income tax credit program for active qualified stewardship practices on a farm or ranch beginning January 1, 2026. The practices incentivized under the program are designed to improve soil health, reduce the need for GHG-causing inputs, sequester carbon, increase water retention, and build climate and drought resilience.
House Bill 24-1435 Colorado Water Conservation Board Annual Projects Bill: Authorizes water projects from the Construction Fund and the Severance Tax Perpetual Base Fund. This year’s “CWCB Projects Bill” includes over $220 million in funding for important Colorado Water Conservation Board Programs and Projects. This includes $23 million in Water Plan Grant funding for water storage and supply, agricultural projects, engagement and innovation, conservation and land use planning, and watershed health and recreation; $2 million for the Turf Replacement Program; $2 million for Innovative Water Forecasting; $4 million for drought planning; $65 million in loan funds for water supply projects; and $20 million for Shoshone Water Right acquisition on the Colorado River.
House Bill 24-1379 Regulated Dredge and Fill Activities in State Waters: Safeguards Colorado’s wetlands and seasonal streams by establishing a first-of-its-kind in the nation permitting program regulating the discharge of dredged and fill material to state waters. The legislation directly responds to last year’s U.S. Supreme Court decision in Sackett v. EPA, which left wetlands and streams unprotected under the federal Clean Water Act. The bill authorizes the Water Quality Control Commission to work with the Water Quality Control Division to avoid, minimize, and mitigate the impacts of dredge and fill activities.
Senate Bill 24-005 Prohibition on Non-Functional Turf, Artificial Turf, and Invasive Plant Species: Prevents a local government from installing, planting or placing or allowing any person to install, plant or place, any nonfunctional turf, artificial turf, or invasive plant species as part of any new project or development after January 1, 2026. Prevents Colorado’s Department of Personnel and Administration from doing so at state facilities. This bill will play a key role in securing Colorado’s water future by helping our communities grow with water-efficient and climate-resilient urban landscapes.
Senate Bill 24-197 Colorado River Drought Task Force Water Conservation Measures: Codifies the recommendations of the Colorado River Drought Task Force by expanding the ability to use reservoir water to restore environmental streamflow while protecting existing water rights, reducing or waiving the Water Plan Grant matching requirements for the Southern Ute Indian Tribe and the Ute Mountain Ute Tribe, and extending the Agricultural Water Rights Protection water-sharing tool statewide. It also provides abandonment protection for utility water rights in the Yampa Valley to preserve future clean energy development options and to promote a fair and Just Transition away from coal in Northwest Colorado.
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