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SB 5445

Encouraging utility investment in local energy resilience.

2025-2026 Regular Session Introduced by Matt Boehnke and 2 co-sponsors

SB 5445 creates incentives and paths for utilities to invest in local DERs and agrivoltaics, expanding exemptions and a multiplier to accelerate distributed energy resilience.

Effective date 7/27/2025.
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Bill Summary · SB 5445

Summary — SB 5445 (2025): Encouraging utility investment in local energy resilience

Status & key dates
- Bill: SB 5445 — Engrossed Substitute Senate Bill 5445 (as amended by the House)
- Chapter: Chapter 265, 2025 Laws
- Governor signed: May 13, 2025
- Effective date: July 27, 2025

Purpose
- Create incentives and regulatory changes to accelerate development of distributed energy resources (DERs) and local energy resilience, while protecting agricultural use and encouraging utility investment. The Legislature cites an expected 30% regional increase in electricity demand over the next decade as context for the measure.

Main provisions
1. Definition and identification of “Distributed Energy Priorities” (new section added to chapter 43.21F RCW)
- Lists categories of preferred DER projects (solar + storage + distribution & EV charging, small‑scale wind, energy storage, microgrids, demand‑management and thermal storage programs) when sited in locations that minimize new land impacts, including:
- Within transmission easements or existing utility footprints
- Within highway/county road rights‑of‑way
- Over irrigation canals and certain reservoirs (non-salmon/steelhead)
- On elevated parking structures, transportation facility lands (airports, rail), closed/capped landfills, reclaimed mines and remediated contaminated sites with caps, and existing structures
- Agrivoltaic facilities (ground‑mounted solar designed to operate alongside ongoing agriculture)
- Dept. of Commerce (state energy office) must periodically review and may recommend additions to the list.

  1. Agrivoltaics and land‑use/tax treatment (amendments to Open Space Taxation Act RCW 84.34.x)

    • Adding an agrivoltaic facility to land classified as farm and agricultural land will not automatically reclassify or withdraw that land from current‑use (open space) classification or trigger additional back taxes under the Open Space Taxation Act, provided agricultural productivity and other statutory limits are maintained.
    • Agrivoltaic requirements: design to allow continued productive agriculture (crop, grazing, animal husbandry, apiaries), avoid permanent degradation, avoid sale of associated water rights, and consider light, water infrastructure, and equipment access.

  2. SEPA categorical exemptions (new section to chapter 43.21C RCW)

    • Creates categorical exemptions under the State Environmental Policy Act for certain small‑scale distributed solar actions (examples include arrays/structures with footprints under specified thresholds sited on previously disturbed lands or existing structures). (Text includes detailed size/location conditions.)

  3. Alternative compliance pathway & multipliers under the Energy Independence Act (amend RCW 19.285.040)

    • Qualifying utilities (those >25,000 customers) may meet their EIA renewable/compliance obligations through a combination of eligible renewable resources and investments in specified distributed energy priority projects and accelerated conservation/demand‑response actions.
    • The enrolled bill provides an enhanced counting mechanism (House reports describe a “quadruple multiplier” for the value of certain new distributed energy priority generation) to incentivize utility investment in qualifying local DER projects.

Who is affected
- Qualifying utilities (investor‑owned and consumer‑owned utilities subject to the EIA): new compliance options and incentives to invest in localized DERs.
- Farmers and agricultural landowners: clarity that properly designed agrivoltaic installations will not automatically trigger current‑use reclassification and tax penalties.
- Developers of DERs, microgrids, energy storage, and small wind projects: potentially faster permitting paths and more attractive economics.
- Local governments, permitting agencies, and state agencies (Department of Commerce, Dept. of Ecology, Utilities & Transportation Commission): new duties (review/recommendations, oversight, and changes to SEPA application).

Potential impacts and considerations
- Intended to accelerate distributed clean energy deployment, strengthen distribution‑level resilience, create local jobs and apprenticeships, and help utilities meet growing load while protecting agricultural land.
- SEPA exemptions and tax treatment may reduce permitting/time costs for smaller or specially sited projects but could raise environmental review concerns in some localities.
- The enhanced counting/multiplier for qualifying DERs is a financial incentive to utilities; its practical effect will depend on program rules, definitions, and administrative implementation by state agencies and utility regulators.

Procedural history (selected)
- Introduced: Jan 23, 2025
- Passed Senate and House (with amendments); enrolled and concurred in House amendments by Senate Apr 22, 2025.
- Delivered to Governor Apr 25, 2025; signed May 13, 2025; effective July 27, 2025.

For full text and statutory citations, see the enrolled bill (Engrossed Substitute SB 5445) and the amended RCW sections: 43.21F, 43.21C, 84.34.020/070, and 19.285.040.

Compiled from official sources — confirm details with the bill’s official record.

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