On May 6, 2025, the Pennsylvania Senate passed Senate Bill 349 by a vote of 49-1. A week later, on May 13, 2025, the legislation was referred to the state House Environmental and Natural Resource Protection Committee to begin deliberations in that Chamber of the General Assembly. Senate Bill 349 has moved through the General Assembly much more rapidly than other solar energy related legislation. With this background, it is worthwhile to take a closer look at this proposed legislation to see what role it may play in Pennsylvania’s renewable energy future.
Senate Bill 349, entitled “An Act Amending Title 27 (Environmental Resources) of the Pennsylvania Consolidated Statutes, in environmental protection, providing for decommissioning of solar energy facilities”, adds a Chapter to the Pennsylvania Consolidated Statutes. That indicates an intent to fairly comprehensively address the decommissioning of solar energy facilities.
The decommissioning of solar energy facilities is a challenge. Presently, there is no statewide protocol or bonding requirement to ensure that solar energy facilities are removed and the land restored after those facilities cease generating electricity. That leaves decommissioning requirements to a patchwork of local ordinances, and with the topic also being something that should be addressed in solar energy facility leases.
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Decommissioning can be a thorny topic because once solar energy facilities are no longer generating electricity (and revenue), their operators may not have the greatest incentive to spend money to remove them and to restore the property. And, the decommissioning, restoration and reclamation costs can be difficult to project.
Senate Bill 349 seems intended to fill this void by creating statewide requirements to address the issue. The draft legislation first stipulates that after the Bill becomes law, solar energy facility agreements must contain a provision stating that the grantee (the solar energy facility operator) is responsible for decommissioning the solar energy facility, and that this decommissioning generally be completed within 18 months after the facility stops producing electricity.
This seems a reasonable requirement from a public policy perspective. The operator of a solar energy facility, who generated revenue from the facility, should be responsible for its decommissioning and the restoration of the land. But, Senate Bill 349’s requirement that solar energy facility leases must contain a decommissioning provision leaves a large unanswered question. What happens if a solar energy facility agreement does not contain such a provision? Senate Bill 349 does not provide a penalty or consequence for the absence of a decommissioning provision.
The bulk of Senate Bill 349 is dedicated to proof of financial assurance for decommissioning. This is an important concept. While a lease agreement may obligate a solar energy facility operator to decommission the facilities and to restore the land, that is not always enforceable in practice. A solar energy facility operator may not have any money to decommission the facilities or to restore the land, so pointing to a contractual obligation to do so will likely be of little recourse in that instance. That is where proof of financial insurance, like surety bonds for example, enter the picture. Those instruments backstop an operator’s decommissioning obligation by providing a source of funding if the operator fails to satisfy its restoration duties.
Whereas other energy resource industries in Pennsylvania, like coal, oil and gas, have land restoration bonding requirements through a state agency, Senate Bill 349 does not take this approach. Instead, Senate Bill 349 involves county recorders of deeds. Under Senate Bill 349, the grantee of a solar energy facility lease must “. . . provide a decommissioning plan, submit proof of financial assurance to the county recorder of deeds and provide notice to the surface property owner party to the solar energy facility agreement.”
On this front, another component of Senate Bill 349 that is unclear is the exact role of the county recorder of deeds in this process. Does Senate Bill 349 reference the county recorder of deeds because proof of financial assurance would be recorded in the county’s public records? Or, is the county recorder of deeds supposed to be the official who ensures that a solar energy facility operator is complying with the law related to decommissioning?
While Senate Bill 349 is not clear about the extent of the role thata county recorder of deeds would play in the realm of solar energy facility decommissioning bonds, the draft legislation contains substantial detail about the frequency of information that must be submitted. Under Senate Bill 349, solar energy facility operators must submit decommissioning plans and proofs of financial assurance to the county recorder of deeds office no more than 30 days before construction of the solar energy facility begins, and then again every five years.
As to the amount of financial assurance, Senate Bill 349 dictates that it must be “equal to the estimated cost to decommission the solar energy facility. The amount of financial assurance, as updated every 5 years, must be calculated by a third party professional engineer who is retained by the grantee in a solar energy facility lease from a list of professional engineers compiled by the Pennsylvania Department of Environmental Protection and published on its website.
Senate Bill 349’s contemplation of frequent updating of decommissioning plans and third party engineers frequently re-calculating decommissioning and restoration requirements is reasonable and seems to benefit all parties involved. It provides a relatively real-time financial picture about the restoration costs and avoids scenarios where the parties may attempt to project costs decades in advance or operate based on a cost structure that is decades old. While Senate Bill 349’s requirement that the third party engineer be retained by the grantee under a solar energy facility agreement seems to be intended to avoid the landowner bearing the cost for that engineer, there can be questions about the decommissioning values and the associated financial security.
For instance, a landowner may retain an engineer who places a different value on the decommissioning and restoration costs than the third party engineer involved in the protocol envisioned under Senate Bill 349. In this scenario, Senate Bill 349 does not seem to operate as a dispute resolution process. It appears that, as far as it relates to satisfying the language of the statute, the decommissioning plan and financial assurance calculations only need to be made by the third party engineer, and are not subject to agreement by the landowner’s engineer.
Another key detail of Senate Bill 349 is its discussion about transferability. The operators of solar energy facilities can change as assets are bought and sold. The draft legislation addresses this by requiring the new counterparty under a solar energy facility agreement to file its proof of financial assurance with the county recorder of deeds before its predecessor is able to release or revoke its financial assurance for decommissioning.
Since Senate Bill 349 calls for the submission of decommissioning plans and proof of financial assurance to be submitted to a public official, Senate Bill 349 instructs the Pennsylvania Department of Environmental Protection to write regulations developing a standard form for decommissioning plans and proof of financial assurance. And, the Department of Environmental Protection is instructed to do this in consultation with the solar energy industry.
The standardized form for decommissioning plan and proof of financial assurance would address things like the removal of equipment, removal of roadways, re-contouring the land and replacing soil. The protocols in the standard decommissioning plan would control unless a property owner and solar energy company agreed otherwise in their contract. These technical points are important matters to address in a decommissioning plan.
While Senate Bill 349’s express contemplation of consultation with the solar energy industry to develop this standard form is concerning (versus consultation involving other stakeholders), Senate Bill 349 does not prohibit landowners from negotiating different protocols in their contracts with solar energy facility operators.
As a final point, Senate Bill 349 would supersede local regulations pertaining to decommissioning of solar energy facilities. On one hand, the existence of a statewide protocol could assist both industry and landowners by providing a relatively uniform standard, particularly if a community does not provide for decommissioning standards in an ordinance addressing solar energy. On the other hand, there is no statewide authority addressing solar energy facilities. This may create issues and confusion where certain requirements exist on a statewide level and other requirements are not yet addressed by the state.
On balance, Senate Bill 349 seems to be a thoughtful approach to an issue facing both property owners and the solar energy industry in Pennsylvania - how to address the decommissioning of solar energy facilities. This draft legislation does have its curiosities and unanswered questions, like the ultimate role of county recorders of deeds, what happens to solar energy facility lease agreements that do not contain decommissioning language, and what happens if a landowner disagrees with the third party engineer calculating decommissioning costs for financial assurance calculations. It is possible that these points will be addressed as Senate Bill continues its ever-shortening path through the legislative process to potentially becoming law. Or, as with many things, they could be addressed down the road after trial and error.
