Senator David P. Hinkins proposes the following substitute bill:




Chief Sponsor: Christine F. Watkins

Senate Sponsor: David P. Hinkins


8     General Description:
9          This bill establishes the Utah San Rafael Energy Lab and creates the Utah San Rafael
10     Energy Lab Board.
11     Highlighted Provisions:
12          This bill:
13          ▸     defines terms;
14          ▸     creates the Utah San Rafael Energy Lab;
15          ▸     creates the Utah Energy Research Fund;
16          ▸     establishes the Utah San Rafael Energy Lab Board (board);
17          ▸     establishes the membership and duties of the board and the lab;
18          ▸     outlines the purpose and duties of the board and the lab; and
19          ▸     establishes a project proposal solicitation and approval process.
20     Money Appropriated in this Bill:
21          This bill appropriates in fiscal year 2025:
22          ▸     to Department of Natural Resources - Office of Energy Development as a one-time
23     appropriation:
24               •     from the General Fund, One-time, $2,000,000
25     Other Special Clauses:

26          None
27     Utah Code Sections Affected:
28     ENACTS:
29          79-6-1001, Utah Code Annotated 1953
30          79-6-1002, Utah Code Annotated 1953
31          79-6-1003, Utah Code Annotated 1953
32          79-6-1004, Utah Code Annotated 1953
33          79-6-1005, Utah Code Annotated 1953

35     Be it enacted by the Legislature of the state of Utah:
36          Section 1. Section 79-6-1001 is enacted to read:
37          79-6-1001. Definitions.
38          As used in this part:
39          (1) "Board" means the Utah San Rafael Energy Lab Board established in Section
40     79-6-1003.
41          (2) "Director" means the director of the Office of Energy Development as defined in
42     Section 79-6-401.
43          (3) "Fund" means the Utah Energy Research Fund established in Section 79-6-1002.
44          (4) "Lab" means the Utah San Rafael Energy Lab established in Section 79-6-1004.
45          (5) "Lab director" means the director appointed under Section 79-6-1004 to oversee the
46     lab.
47          (6) "Project proposal" means a formal written submission to the board applying for
48     approval of a specific research initiative conducted at the lab.
49          (7) "Office" means the Office of Energy Development as defined in Section 79-6-401.
50          Section 2. Section 79-6-1002 is enacted to read:
51          79-6-1002. Utah Energy Research Fund.
52          (1) There is created an enterprise fund known as the "Utah Energy Research Fund."
53          (2) The fund consists of:
54          (a) grants, entitlements, and other money received by the office from the federal
55     government;
56          (b) revenues from users of the Utah San Rafael Energy Lab, deposited into the fund

57     under Subsection 79-6-1004(2)(d);
58          (c) transfers, grants, bequests, and money made available from any source to
59     implement this part; and
60          (d) money appropriated to the fund by the Legislature.
61          (3) The money in the fund shall be invested by the state treasurer according to the
62     procedures and requirements of Title 51, Chapter 7, State Money Management Act, except that
63     all interest or other earnings derived from money in the fund shall be deposited in the fund.
64          (4) As funding allows, the office may use money in the fund for:
65          (a) administering the Utah Energy Research Grant Program created in Section
66     79-6-403; and
67          (b) funding the ongoing operation of the Utah San Rafael Energy Lab, including
68     compensation for lab staff.
69          Section 3. Section 79-6-1003 is enacted to read:
70          79-6-1003. Utah San Rafael Energy Lab Board -- Duties -- Expenses.
71          (1) There is established in the office the Utah San Rafael Energy Lab Board that is
72     composed of the following nine voting board members:
73          (a) the director, or the director's designee, who shall serve as the chair of the board;
74          (b) the president of the University of Utah or the president's designee;
75          (c) the president of Utah State University or the president's designee;
76          (d) the commissioner of higher education, as described in Section 53B-1-408, or the
77     commissioner's designee;
78          (e) one member, who is not a legislator, with experience in the non-regulated energy
79     industry appointed by the speaker of the House of Representatives;
80          (f) one member, who is not a legislator, with experience in energy commercialization
81     appointed by the president of the Senate;
82          (g) one member appointed by the governor who resides in a county of the third, fourth,
83     fifth, or sixth class as described in Section 17-50-501; and
84          (h) two members appointed by the office with relevant expertise in energy research and
85     development.
86          (2) (a) The term of an appointed board member is four years.
87          (b) Notwithstanding Subsection (2)(a), the person making an appointment shall, at the

88     time of appointment or reappointment, adjust the length of board member terms to ensure the
89     terms of board members are staggered so that approximately half of the board is constituted of
90     new members every two years.
91          (c) The person who appoints a member under Subsection (1) may remove an appointee
92     who was appointed by the person for cause.
93          (d) The person who appoints a member under Subsection (1) shall fill a vacancy on the
94     board in the same manner as provided in Subsection (1).
95          (e) An individual appointed to fill a vacancy shall serve the remaining unexpired term.
96          (f) Unless removed for cause under Subsection (2)(c) a board member shall serve until
97     a successor is appointed.
98          (3) (a) A majority of the board constitutes a quorum.
99          (b) A majority vote of the quorum is required for an action to be taken by the board.
100          (4) The board shall:
101          (a) foster innovation and support technological development in the energy sector by
102     collaborating with industry leaders, researchers, entrepreneurs, investors, and other
103     stakeholders;
104          (b) identify areas of economic growth and workforce development opportunities
105     related to emerging energy technologies and solutions;
106          (c) seek potential investors and partners from the technology, finance, and business
107     sectors to support innovative research and early-stage ventures focused on developing
108     commercially viable energy technologies in the state;
109          (d) in consultation with the lab, identify and prioritize high-impact research projects for
110     the lab aligned to the state's energy policy goals;
111          (e) develop evaluation criteria for approving project proposals, with input from the lab
112     director, including:
113          (i) alignment with state energy policy priorities;
114          (ii) commercialization potential;
115          (iii) economic impact; and
116          (iv) other relevant factors as determined by the board;
117          (f) recommend allocation of lab resources for project proposals;
118          (g) approve providing matching grants to applicants under the Utah Energy Research

119     Grant Program created in Section 79-6-403; and
120          (h) consult with relevant stakeholders for input on energy research priorities and
121     potential collaborations.
122          (5) A member may not receive compensation or benefits for the member's service, but
123     may receive per diem and travel expenses in accordance with:
124          (a) Section 63A-3-106;
125          (b) Section 63A-3-107; and
126          (c) rules made by the Division of Finance pursuant to Sections 63A-3-106 and
127     63A-3-107.
128          (6) The board shall meet at least quarterly and may hold additional meetings as
129     necessary to review project proposals.
130          Section 4. Section 79-6-1004 is enacted to read:
131          79-6-1004. Utah San Rafael Energy Lab established -- Lab director.
132          (1) There is established within the office a program and facility known as the Utah San
133     Rafael Energy Lab to facilitate innovative energy research and development projects.
134          (2) The lab shall:
135          (a) receive and evaluate project proposals;
136          (b) submit recommendations to the board for approval regarding specific project
137     proposals based on the lab's evaluation;
138          (c) conduct innovative energy technology research and development projects that have
139     commercialization potential and support the state's energy policy goals;
140          (d) enter into financial contracts with entities seeking to use the lab, with revenues
141     deposited into the Utah Energy Research Fund created in Section 79-6-1002;
142          (e) assess the viability of emerging energy solutions for deployment within the state,
143     considering:
144          (i) cost-effectiveness;
145          (ii) dispatchability;
146          (iii) sustainability;
147          (iv) reliability; and
148          (v) environmental impact;
149          (f) provide analysis and recommendations to policymakers regarding energy system

150     planning, infrastructure needs, and the value of different energy initiatives being considered
151     within the state; and
152          (g) collaborate with universities, industry partners, entrepreneurs, community
153     representatives, and other research entities.
154          (3) (a) The director shall appoint a full-time lab director with the consent of the board
155     to oversee the day-to-day operations of the lab.
156          (b) The lab director shall report to the director.
157          (c) As funding allows, the office may employ staff to support the lab's operations.
158          Section 5. Section 79-6-1005 is enacted to read:
159          79-6-1005. Project proposal solicitation and approval process.
160          (1) The lab shall have an open project proposal solicitation process to facilitate
161     innovative energy research and development conducted at the lab that is aligned with the state
162     energy policy.
163          (2) The lab shall receive project proposals from:
164          (a) academics and research faculty from universities and research institutions;
165          (b) private sector companies, including technology entrepreneurs and small businesses;
166          (c) government agencies and national laboratories;
167          (d) nonprofit organizations and foundations engaged in energy research; and
168          (e) other qualified research teams.
169          (3) (a) The lab shall evaluate the feasibility, merit, and potential impact of project
170     proposals received under Subsection (2).
171          (b) After evaluating the project proposals, the lab shall submit recommendations to the
172     board for specific project proposals that the lab advises approving, based on the evaluation
173     criteria.
174          (4) The board shall review the project proposals and recommendations submitted by
175     the lab and make final decisions on approval of project proposals for funding and
176     implementation, based on criteria developed by the board under Section 79-6-1003.
177          (5) The office may make rules, in accordance with Title 63G, Chapter 3, Utah
178     Administrative Rulemaking Act, establishing detailed project proposal evaluation criteria and
179     selection procedures.
180          Section 6. FY 2025 Appropriation.

181          The following sums of money are appropriated for the fiscal year beginning July 1,
182     2024, and ending June 30, 2025. These are additions to amounts previously appropriated for
183     fiscal year 2025.
184          Subsection 6(a). Business-like Activities.
185          The Legislature has reviewed the following proprietary funds. Under the terms and
186     conditions of Utah Code 63J-1-410, for any included Internal Service Fund, the Legislature
187     approves budgets, full-time permanent positions, and capital acquisition amounts as indicated,
188     and appropriates to the funds, as indicated, estimated revenue from rates, fees, and other
189     charges. The Legislature authorizes the State Division of Finance to transfer amounts between
190     funds and accounts as indicated.
     To Department of Natural Resources - Office of Energy Development
192      From General Fund, One-time$2,000,000
193      Schedule of Programs:
194      Utah San Rafael Energy Lab$2,000,000

195          Section 7. Effective date.
196          This bill takes effect on May 1, 2024.