To require the Secretary of Energy to establish a grant program for States to provide incentives to natural gas distribution companies for the improvement of natural gas distribution systems, and for other purposes.

To require the Secretary of Energy to establish a grant program for States to provide incentives to natural gas distribution companies for the improvement of natural gas distribution systems, and for other purposes. 1. Improving the natural gas distribution system (a) Establishment of program Not later than 1 year after the date of enactment of this Act, the Secretary of Energy shall establish a program to award grants to States, in accordance with this section, for the purpose of improving public safety and environmental performance of the natural gas distribution system by offsetting rate increases to low-income households and providing incentives for natural gas distribution companies to accelerate, expand, or enhance improvements to the natural gas distribution system. (b) Grants to States (1) In general A State may apply for a grant under this section to provide funds to natural gas distribution companies in the State that are carrying out an eligible project described in subsection (c). (2) Requirements In applying for a grant under this section, a State shall demonstrate how the State rate-setting commission will ensure that funds provided under this section are used in accordance with the requirements of this section. (c) Eligible projects A project that is eligible to be funded through a grant to a State under this section is a project carried out by a natural gas distribution company to accelerate, expand, or enhance the implementation of a plan, approved by the State before the date on which an application for a grant under this section is submitted to the Secretary, for— (1) replacement of cast and wrought iron and bare steel pipes and other leak-prone components of the natural gas distribution system; or (2) inspection and maintenance programs for the natural gas distribution system. (d) Rate assistance A natural gas distribution company receiving funds through a grant to a State under this section may use such funds only to offset the near-term incremental costs to low-income households as reflected in utility rate increases and the near-term incremental costs of accelerating, expanding, or enhancing improvements to the natural gas distribution system included in the State-approved plan. (e) Limit to transitional assistance A State may provide funds to a natural gas distribution company under this section for a period not to exceed 4 years. (f) Prioritization In awarding grants under this section, the Secretary shall prioritize applications based on the expected results of an eligible project carried out pursuant to the State proposal with respect to— (1) quantifiable benefits for public safety; (2) the magnitude of methane emissions reductions; (3) innovation in technical or policy approaches; (4) the number of low-income households anticipated to benefit from the assistance; and (5) overall cost-effectiveness of the project. (g) Auditing and reporting requirements The Secretary shall establish auditing and reporting requirements for States with respect to the performance of eligible projects funded pursuant to grants awarded under this section with respect to meeting the goals of the program described in subsection (f). (h) Prevailing wages All laborers and mechanics employed by contractors or subcontractors in the performance of construction, alteration, or repair work assisted, in whole or in part, by a grant under this section shall be paid wages at rates not less than those prevailing on similar construction in the locality as determined by the Secretary of Labor in accordance with subchapter IV of chapter 31 (i) Definitions In this section: (1) Low-income household The term low-income household 42 U.S.C. 8624(b)(2) (2) Natural gas distribution company The term natural gas distribution company (j) Authorization of appropriations There are authorized to be appropriated to the Secretary $250,000,000 to carry out this section in each fiscal year beginning in fiscal year 2021 and ending in fiscal year 2030.

Summary: This bill directs the Department of Energy (DOE) to establish a grant program for states to improve public safety and environmental performance of the natural gas distribution system by offsetting rate increases to low-income households and providing incentives for natural gas distribution companies to accelerate, expand, or enhance improvements to the natural gas distribution system. Grants must be used for (1) replacement of cast and wrought iron and bare steel pipes and other leak-prone components of the natural gas distribution system, or (2) inspection and maintenance programs for such system. In awarding grants under the program, DOE must prioritize applications based on the expected results of a project with respect to (1) quantifiable benefits for public safety, (2) the magnitude of methane emissions reductions, (3) innovation in technical or policy approaches, (4) the number of low-income households anticipated to benefit from the assistance, and (5) overall cost-effectiveness of the project.