1.  The Commission shall adopt regulations authorizing a public utility which purchases natural gas for resale to engage in renewable natural gas activities, including, without limitation:

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(a) Procedures for a public utility which purchases natural gas for resale to apply to the Commission for approval of a reasonable and prudent renewable natural gas activity that will be used and useful and will provide environmental benefits to this State as provided in subsection 2; and

(b) Procedures for a public utility which purchases natural gas for resale to apply to the Commission for the recovery of all reasonable and prudent costs associated with a renewable natural gas activity approved by the Commission pursuant to the regulations adopted pursuant to this subsection.

2.  The Commission may approve a renewable natural gas activity pursuant to subsection 1 if the renewable natural gas activity is demonstrated to provide one or more of the following environmental benefits to this State:

(a) The reduction or avoidance of emissions of any air pollutant or greenhouse gas in this State;

(b) The reduction or avoidance of any pollutant that could have an adverse impact on the waters of this State; or

(c) The alleviation of a local nuisance within this State that is associated with the emission of odors.

3.  The renewable natural gas activities which may be approved by the Commission pursuant to the regulations adopted in accordance with subsection 1 are:

(a) Making a financial investment in a renewable natural gas facility;

(b) Contracting with a producer of renewable natural gas to build and operate a renewable natural gas facility;

(c) Extending the transmission or distribution system of the public utility which purchases natural gas for resale to interconnect with a renewable natural gas facility;

(d) Purchasing gas produced from a renewable natural gas facility, whether or not the gas has environmental attributes:

(1) To incorporate the gas produced from a renewable natural gas facility into the supply portfolio of the public utility which purchases natural gas for resale; or

(2) To sell the gas produced from a renewable natural gas facility directly to the customers of the public utility;

(e) Participating in a state or federal renewable energy program or project if participation in the program or project by the public utility which purchases natural gas for resale:

(1) Consists of the purchase or sale of gas produced by a renewable natural gas facility or environmental attributes by the public utility; and

(2) Results in a reduction of the cost of gas produced from a renewable natural gas facility to the customers of the public utility;

(f) Providing customers of the public utility which purchases natural gas for resale with the option to purchase gas produced from a renewable natural gas facility, with or without environmental attributes, directly from the public utility; or

(g) Any other activity which develops sources of renewable natural gas in this State for the purpose of reducing emissions of greenhouse gases, creating jobs through the construction and operation of renewable natural gas facilities in this State and diversifying the supply of energy in this State.

4.  A public utility which purchases natural gas for resale shall attempt to incorporate renewable natural gas into its gas supply portfolio in the following amounts:

(a) By January 1, 2025, not less than 1 percent of the total amount of gas sold to by public utility to its retail customers;

(b) By January 1, 2030, not less than 2 percent of the total amount of gas sold to the public utility’s retail customers; and

(c) By January 1, 2035, not less than 3 percent of the total amount of gas sold to the public utility’s retail customers.