Senate Bill 25-182 Revised

A Bill for an Act

• Page 1, Line 101Concerning encouraging the reduction of embodied carbon.

Bill Summary

(Note: This summary applies to this bill as introduced and does not reflect any amendments that may be subsequently adopted. If this bill passes third reading in the house of introduction, a bill summary that applies to the reengrossed version of this bill will be available at http://leg.colorado.gov.)

Embodied carbon is the carbon associated with greenhouse gas emissions arising from the production, construction, use, and end-of-life of products or systems used in the construction of buildings, roads, and other infrastructure. An embodied carbon improvement is a real property installation or modification that is completed in a manner that generates relatively less embodied carbon.

Section 1 of the bill adds embodied carbon improvements to the list of new energy improvements that are eligible for property-assessed clean energy financing provided by the Colorado new energy improvement district.

Section 2 modifies the industrial clean energy tax credit so that embodied carbon improvements are greenhouse gas emissions reduction improvements.

• Page 2, Line 1Be it enacted by the General Assembly of the State of Colorado:

• Page 2, Line 2SECTION 1.  Legislative declaration. (1)  The general assembly

• Page 2, Line 3finds and declares that nothing in Senate Bill 25-182 impacts the ability

• Page 2, Line 4of a local governmental entity to review or approve eligible materials for installations or modifications to real property.

• Page 2, Line 5SECTION 2.  In Colorado Revised Statutes, 32-20-103, amend the introductory portion and (7); and add (4.5) as follows:

• Page 2, Line 632-20-103.  Definitions. As used in this article article 20, unless the context otherwise requires:

• Page 2, Line 7(4.5)  "Embodied carbon improvement" means one or more

• Page 2, Line 8installations or modifications to real property using eligible

• Page 2, Line 9materials, as defined in section 24-92-118 (2)(b), that result in

• Page 2, Line 10the reduction of the installation's or modification's embodied

• Page 2, Line 11emissions as established in policies created by the Colorado

• Page 2, Line 12energy office, created in section 24-38.5-101, and in consultation with the office of the state architect.

• Page 2, Line 13(7)  "New energy improvement" means one or more on-site energy

• Page 2, Line 14efficiency improvements, embodied carbon improvements, renewable

• Page 2, Line 15energy improvements, resiliency improvements, or water efficiency

• Page 2, Line 16improvements made to eligible real property that will reduce the energy

• Page 2, Line 17consumption of or add energy produced from renewable energy sources with regard to any portion of the eligible real property.

• Page 2, Line 18SECTION 3.  In Colorado Revised Statutes, 39-22-551, amend

• Page 3, Line 1(2)(e) introductory portion and (2)(e)(XVIII); and add (2)(e)(XVIII.5) as follows:

• Page 3, Line 239-22-551.  Industrial clean energy tax credit - tax preference

• Page 3, Line 3performance statement - definitions - report - repeal. (2)  Definitions. As used in this section, unless the context otherwise requires:

• Page 3, Line 4(e)  "Greenhouse gas emissions reduction improvements" means

• Page 3, Line 5improvements that help to measurably reduce greenhouse gas emissions.

• Page 3, Line 6"Greenhouse gas emissions reduction improvements" may include one or

• Page 3, Line 7more of the following equipment purchases, improvements, and retrofits retrofits, or investments:

• Page 3, Line 8(XVIII)  Material substitutions within industrial processes to

• Page 3, Line 9reduce industrial process greenhouse gas emissions by a minimum of fifteen percent when compared to existing production practices; and

• Page 3, Line 10(XVIII.5)  For income tax years commencing on or after

• Page 3, Line 11January 1, 2026, embodied carbon investments, which are

• Page 3, Line 12investments in the production of eligible materials, as defined

• Page 3, Line 13in section 24-92-118 (2)(b), that result in the reduction of the

• Page 3, Line 14eligible materials' cradle-to-gate embodied emissions, as

• Page 3, Line 15established in policies created by the Colorado energy office,

• Page 3, Line 16created in section 24-38.5-101, and in consultation with the

• Page 3, Line 17office of the state architect. To qualify as an embodied carbon

• Page 3, Line 18investment, an investment must result in a fifteen percent or

• Page 3, Line 19greater reduction in cradle-to-gate embodied emissions of the

• Page 3, Line 20eligible materials when compared to the eligible materials'

• Page 3, Line 21cradle-to-gate baseline as established in standards and

• Page 3, Line 22guidelines created by the Colorado energy office and in

• Page 3, Line 23consultation with the office of the state architect. A

• Page 4, Line 1cradle-to-gate measurement or baseline considers the life cycle

• Page 4, Line 2stages for a product including, but not limited to, the raw

• Page 4, Line 3material extraction and processing related to the product, and

• Page 4, Line 4the transport to the manufacturer and manufacturing of the product.

• Page 4, Line 5SECTION 4.  Act subject to petition - effective date. This act

• Page 4, Line 6takes effect at 12:01 a.m. on the day following the expiration of the

• Page 4, Line 7ninety-day period after final adjournment of the general assembly; except

• Page 4, Line 8that, if a referendum petition is filed pursuant to section 1 (3) of article V

• Page 4, Line 9of the state constitution against this act or an item, section, or part of this

• Page 4, Line 10act within such period, then the act, item, section, or part will not take

• Page 4, Line 11effect unless approved by the people at the general election to be held in

• Page 4, Line 12November 2026 and, in such case, will take effect on the date of the official declaration of the vote thereon by the governor.