Senate panel reviews regulatory reform bill focused on energy savings contracts

RALEIGH — A North Carolina Senate committee was scheduled Wednesday to discuss a regulatory reform bill that would rewrite and recodify state law governing guaranteed energy savings contracts used by government agencies.

Senate Bill 1047, titled the “Regulatory Reform Act of 2026,” was re-referred Tuesday to the Senate Regulatory Reform Committee, with additional referrals to Judiciary, Finance and Rules and Operations if it receives favorable reports. The bill was scheduled for discussion only Wednesday morning.

Although regulatory reform bills can include broad changes across state government, the filed version of Senate Bill 1047 focuses heavily on guaranteed energy savings contracts. The bill describes itself as an act “to provide further regulatory relief to the citizens of North Carolina.”

Guaranteed energy savings contracts allow government units to enter into agreements for energy conservation measures, with expected cost savings tied to project performance. Senate Bill 1047 would create a new part of state law for those contracts and recodify several existing statutes into that section.

The bill would require a government unit to issue a request for qualifications before entering into a guaranteed energy savings contract. The notice would have to be published at least 15 days before the closing date on a state-maintained electronic procurement portal. Local government units would also have to publish notice in a newspaper of general circulation in the area or on the unit’s publicly accessible website.

The request for qualifications would have to include the name and address of the government unit, a contact person, a general description of the facilities and scope of energy conservation measures, evaluation criteria, the deadline for responses and a statement reserving the right to reject responses.

The proposal would require government units to evaluate providers based on factors including demonstrated competence, past performance on energy savings projects, technical feasibility, life cycle cost analysis, total project cost and financing comparisons. For state governmental units, the bill would require a provision for annual measurement and verification review by an impartial third party.

The bill would also address what happens if only one qualified provider responds. In that situation, a government unit could proceed without resoliciting if it makes a written determination that another solicitation is unlikely to increase competition. For state government units, the State Energy Office would have to concur before the provider could be selected.

Before entering into a contract, the selected provider would have to make available for public inspection a report summarizing estimated installation, maintenance, repair and debt service costs, along with estimated reductions in energy or operating costs. The provider would also have to conduct an investment-grade audit.

The bill would require annual reconciliation statements comparing guaranteed savings with actual savings. If savings fall short, the qualified provider would have to pay the government unit or its assignee for the shortfall.

Because the bill is scheduled for discussion only, no committee vote was listed on the calendar for Wednesday. The measure would need to clear multiple committees before reaching the Senate floor.

Editor’s note: This article was drafted with the assistance of artificial intelligence and was reviewed and fact-checked by a member of the NC Political News editorial team before publication.