Senate Committee of Reference Report
Committee on Finance
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May 11, 2026
After consideration on the merits, the Committee recommends the following:
HB26-1326 be amended as follows, and as so amended, be referred to the Committee on Appropriations with favorable recommendation:
Page 1, Line 1Amend reengrossed bill, page 22, after line 21 insert:
Page 1, Line 2"SECTION 19. In Colorado Revised Statutes, 40-2-123, add (6)
Page 1, Line 3and (7) as follows:
Page 1, Line 440-2-123. Energy technologies - consideration by commission
Page 1, Line 5- incentives - demonstration projects - commission may require
Page 1, Line 6specific customer-facing programs - legislative declaration -
Page 1, Line 7definitions.
Page 1, Line 8(6) (a) The general assembly finds and declares that:
Page 1, Line 9(I) Since 2007, Colorado has enacted several statutes
Page 1, Line 10that direct commission-regulated investor-owned utilities to
Page 1, Line 11implement customer-facing programs aimed at reducing energy
Page 1, Line 12bills, reducing energy consumption, or supporting the transition
Page 1, Line 13to lower- or zero-carbon-emitting technologies;
Page 1, Line 14(II) Such customer-facing programs include demand-side
Page 1, Line 15management, beneficial electrification, clean heat plans, and
Page 1, Line 16transportation electrification;
Page 1, Line 17(III) For many of these programs, utilities may lack a
Page 1, Line 18natural incentive to take certain actions or implement these
Page 1, Line 19programs effectively. Additionally, due to staffing or
Page 1, Line 20economies of scale, smaller utilities may lack the ability to
Page 1, Line 21operate such programs at a reasonable cost to ratepayers.
Page 1, Line 22(IV) Certain ratepayer affordability programs are
Page 1, Line 23implemented by a third party that was not selected through a
Page 1, Line 24competitive process, and there is limited oversight of the third
Page 1, Line 25party's use of ratepayer dollars;
Page 1, Line 26(V) Established state enterprises, such as the building
Page 1, Line 27decarbonization enterprise created in section 24-38.5-125, may
Page 2, Line 1provide an alternative option for administering competitive
Page 2, Line 2solicitations for third-party program administration; and
Page 2, Line 3(VI) Therefore, the commission should be authorized to
Page 2, Line 4require commission-regulated investor-owned utilities to
Page 2, Line 5engage one or more third parties to administer specific
Page 2, Line 6customer-facing programs if the commission deems the use of one
Page 2, Line 7or more third parties prudent and in the best interest of
Page 2, Line 8ratepayers. In addition, the commission should be authorized to
Page 2, Line 9require the use of a competitive bidding process to procure the
Page 2, Line 10services of a third-party administrator.
Page 2, Line 11(b) In an adjudicatory proceeding, the commission may
Page 2, Line 12require a commission-regulated investor-owned utility to
Page 2, Line 13engage one or more third parties to administer specific
Page 2, Line 14customer-facing programs if the commission deems the use of one
Page 2, Line 15or more third parties prudent and in the best interest of
Page 2, Line 16ratepayers. The commission may require a competitive bidding
Page 2, Line 17process to procure the services of a third-party administrator.
Page 2, Line 18(c) As used in this subsection (6), "customer-facing
Page 2, Line 19program" means a program aimed at reducing energy bills,
Page 2, Line 20reducing energy consumption, or supporting the transition to
Page 2, Line 21lower- or zero-carbon-emitting technologies.
Page 2, Line 22(7) (a) A commission-regulated investor-owned utility may
Page 2, Line 23enter into a third-party agreement to facilitate
Page 2, Line 24customer-facing programs, subject to commission approval. The
Page 2, Line 25commission may direct a commission-regulated investor-owned
Page 2, Line 26utility to propose to the commission the use of third-party
Page 2, Line 27administration for customer-facing programs.
Page 2, Line 28(b) In a commission-regulated investor-owned utility's
Page 2, Line 29proposal to utilize third-party administration of a
Page 2, Line 30customer-facing program, the utility shall explain to the
Page 2, Line 31commission how the utility considered the following in relation
Page 2, Line 32to the customer-facing program:
Page 2, Line 33(I) The potential for program success based on an
Page 2, Line 34assessment of similar administration structures that other
Page 2, Line 35utilities use for similar customer-facing programs;
Page 2, Line 36(II) The administrative cost ratio of administering rebates
Page 2, Line 37versus the incentives paid out as part of the program;
Page 2, Line 38(III) The time required to fulfill customer rebate
Page 2, Line 39requests; and
Page 2, Line 40(IV) Prior program performance under a utility-led
Page 2, Line 41model.
Page 2, Line 42(c) In an application to the commission to enter into a
Page 2, Line 43third-party agreement to facilitate customer-facing programs,
Page 3, Line 1the utility may not:
Page 3, Line 2(I) Force a layoff of, or unilaterally change the terms of
Page 3, Line 3employment for, the utility employees who, in whole or in part,
Page 3, Line 4perform the administrative or service functions for the specific
Page 3, Line 5program, subject to a third-party agreement, and who are
Page 3, Line 6covered by a collective bargaining agreement unless the utility
Page 3, Line 7and the labor union representing the employees come to an
Page 3, Line 8agreement to reassign the employees to other positions within
Page 3, Line 9the utility at comparable pay and benefits as per the terms of
Page 3, Line 10the collective bargaining agreement and any related company
Page 3, Line 11policies; and
Page 3, Line 12(II) Propose to enter into any third-party administrator
Page 3, Line 13agreements that cancel or modify agreements with
Page 3, Line 14construction or utility construction contractors who are
Page 3, Line 15under a current contract to perform work directly for the
Page 3, Line 16utility on a demand-side management, beneficial electrification,
Page 3, Line 17clean heat, or transportation electrification customer-facing
Page 3, Line 18program. The contracts shall remain in force even if a
Page 3, Line 19third-party administrator is contracted to administer the
Page 3, Line 20customer-facing program. Future considerations as to whether
Page 3, Line 21to extend or renew the construction or utility construction
Page 3, Line 22contractors' agreements can remain with the utility, and the
Page 3, Line 23utility can remain the client of record for the construction or
Page 3, Line 24utility construction contractors. Programs that direct a
Page 3, Line 25residential utility customer to engage a contractor directly
Page 3, Line 26are exempt from this subsection (7)(c)(II).
Page 3, Line 27(d) Subject to commission approval based on a
Page 3, Line 28demonstration of the factors set forth in subsection (7)(b) of
Page 3, Line 29this section, a commission-regulated investor-owned utility
Page 3, Line 30shall utilize third-party administration for any
Page 3, Line 31customer-facing program.
Page 3, Line 32(e) A third-party administrator of a customer-facing
Page 3, Line 33program is directly responsible for compliance with, and shall
Page 3, Line 34adhere to applicable labor standards for, construction- or
Page 3, Line 35utility-construction-specific work that would otherwise be
Page 3, Line 36applicable to the utility under Colorado law.".
Page 3, Line 37Renumber succeeding sections accordingly.
Page 3, Line 38Page 31, strike lines 18 through 27.
Page 3, Line 39Strike page 32.
Page 3, Line 40
Page 4, Line 1Page 33, strike lines 1 through 22.
Page 4, Line 2Renumber succeeding sections accordingly.
Page 4, Line 3Page 33, lines 24 and 25, strike "repeal (7)(a); and".
Page 4, Line 4Page 34, strike lines 1 through 8.