REPORT TITLE:
Public Util; Consumer Advocate


DESCRIPTION:
Establishes a citizen review commission within the DCCA to review
the public utilities commission and advise the consumer advocate
to ensure public participation in decisions.

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
                                                        
THE SENATE                              S.B. NO.           656
TWENTIETH LEGISLATURE, 1999                                
STATE OF HAWAII                                            
                                                             
________________________________________________________________
________________________________________________________________


                   A  BILL  FOR  AN  ACT

RELATING TO THE PUBLIC UTILITIES COMMISSION.



BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF HAWAII:

 1      SECTION 1.  The legislature finds that the public utilities
 
 2 commission has been assigned general supervision over all public
 
 3 utilities under chapter 269, Hawaii Revised Statutes.  Public
 
 4 utilities include those which generate, transmit, and distribute
 
 5 electrical energy throughout the State of Hawaii.
 
 6      Public policy of the State includes the promotion of a long-
 
 7 term objective of energy self-sufficiency and protection and
 
 8 maintenance of the environment.  This policy includes the
 
 9 reduction of fossil-fueled sources of electrical energy through
 
10 the use of increased energy efficiency and Hawaii's abundant
 
11 indigenous renewable energy resources.  The public has also
 
12 demonstrated a strong desire for this approach.
 
13      Unfortunately, over the last decade, the amount and
 
14 percentage of renewable energy-generated electricity has actually
 
15 declined.  This decline has occurred due to the demise of the
 
16 sugar industry and failure by the State to replace sugar industry
 
17 biomass and hydroelectric generating sources.
 
18      A large number of renewable energy developers have attempted
 
19 to develop Hawaii's renewable energy resources, but have
 

 
Page 2                                                     
                                     S.B. NO.           656
                                                        
                                                        

 
 1 generally been unsuccessful.  Many of the impediments to
 
 2 renewable energy development in Hawaii could have been, but have
 
 3 not been, addressed by the commission and the public utilities.
 
 4 Moreover, in many cases, public utilities have been the major
 
 5 impediment to such development.
 
 6      Public utilities also often appear to be more concerned with
 
 7 the concerns and interests of stockholders than those of
 
 8 ratepayers and the general public.  This inequitable approach has
 
 9 often been endorsed and reinforced by actions of the commission.
 
10      The commission and the public utilities have also acted
 
11 contrary to the public's wishes with respect to power plant
 
12 siting and transmission and distribution siting and methods.
 
13 Facility siting stands as a major challenge to environmentally
 
14 sound development.
 
15      Siting disputes mean long delays in the decisionmaking
 
16 process and are very costly to both project proponents and host
 
17 communities.  Moreover, these controversies undermine public
 
18 trust in local and state agencies and may be divisive in the host
 
19 community.  Business-as-usual procedures have not worked;
 
20 innovative solutions are needed to unlock the siting stalemate.
 
21      Furthermore, the public has not been adequately represented,
 
22 or afforded opportunities to substantively participate, in public
 
23 utilities commission activities and decisionmaking processes.
 

 
Page 3                                                     
                                     S.B. NO.           656
                                                        
                                                        

 
 1      Barriers to participation are generally major issues among
 
 2 consumers.  Consumer and community groups have called for
 
 3 mechanisms and systems which are open, participatory, enabling,
 
 4 and empowering for the participants.  The term "participation"
 
 5 implies more sharing, not only of information and opinion, but
 
 6 also of decisionmaking power.
 
 7      The legislature also finds that the consumer advocate has
 
 8 been designated to represent, protect, and advance the interests
 
 9 of all consumers, including small businesses, of utility
 
10 services.  This responsibility for advocating the interests of
 
11 the consumer of utility services shall be separate and distinct
 
12 from the responsibilities of the public utilities commission.
 
13      In general, the consumer advocate has done an acceptable job
 
14 of representing consumer interests.  However, the consumer
 
15 advocate has been hampered by a lack of an appropriate mechanism
 
16 to ensure public participation, or has been unable or unwilling
 
17 to solicit such public participation.  Establishing a citizen
 
18 review committee will provide the necessary public input.  The
 
19 consumer advocate has been further hampered by an inability or
 
20 unwillingness to consider important, non-direct, economic and
 
21 noneconomic factors in the consumer advocacy role.
 
22      The purpose of this Act is to strengthen and improve the
 
23 ability of the consumer advocate to "represent, protect, and
 

 
Page 4                                                     
                                     S.B. NO.           656
                                                        
                                                        

 
 1 advance the interests of all consumers" by:
 
 2      (1)  Establishing a citizen review committee to annually
 
 3           audit the activities of the public utilities commission
 
 4           and public utilities to ensure that regulated
 
 5           monopolies operate in accordance with public policy and
 
 6           according to the desires, and to the benefit, of their
 
 7           customers; and
 
 8      (2)  Mandating that the consumer advocate:
 
 9           (A)  Increase public participation in the decision
 
10                making processes of the public utilities
 
11                commission, by various means including the use of
 
12                a citizens' review committee; and
 
13           (B)  Ensuring that various non-direct cost and
 
14                noneconomic factors are adequately accounted for
 
15                in determining the relative costs and benefits of
 
16                various utility services.
 
17      SECTION 2.  Chapter 269, Hawaii Revised Statutes, is amended
 
18 by adding a new section to be appropriately designated and to
 
19 read as follows:
 
20      "§269-    Citizen review committee; established.  (a)  A
 
21 citizen review committee is established within the department of
 
22 commerce and consumer affairs.
 
23      (b)  The committee shall consist of not less than nine and
 

 
Page 5                                                     
                                     S.B. NO.           656
                                                        
                                                        

 
 1 not more than thirteen members to be appointed by the director of
 
 2 commerce and consumer affairs, and shall be representatives of
 
 3 utility customer classes, consumer groups, environmental groups,
 
 4 and other interested members of the public.
 
 5      (c)  Members of the committee shall serve staggered two-year
 
 6 terms.  Membership terms shall start and end with the state
 
 7 fiscal year.
 
 8      (d)  The consumer advocate shall serve as the nonvoting
 
 9 chair of the committee.
 
10      (e)  The consumer advocate and staff shall assist the
 
11 committee in organizing and conducting public forums and
 
12 information briefings, in soliciting other public comments, and
 
13 in the preparation and distribution of the annual report referred
 
14 to in subsection (i).
 
15      (f)  The committee shall meet not less than annually to:
 
16      (1)  Review and evaluate the activities of the commission
 
17           and public utilities to ensure that such regulated
 
18           monopolies operate in accordance with public policy and
 
19           according to the desires, and to the benefit, of their
 
20           customers; and
 
21      (2)  Study the operation of laws affecting all consumers,
 
22           including small business, of utilities services and
 
23           recommend to the governor and the legislature new laws
 

 
Page 6                                                     
                                     S.B. NO.           656
                                                        
                                                        

 
 1           and amendments of laws in the consumers' interest in
 
 2           the public utilities' field.
 
 3      (g)  The committee shall meet, as required, during a ninety-
 
 4 day period which will commence not earlier than one hundred
 
 5 twenty days prior to the commencement of the next succeeding
 
 6 legislative session.
 
 7      (h)  The committee shall conduct one or more public forums
 
 8 to solicit public comments on the performance of the commission
 
 9 and the public utilities.  Affected interest groups shall be
 
10 adequately notified of these proceedings.  All public forums and
 
11 associated opportunities for public comment shall be completed
 
12 within forty-five days from the first meeting of the committee.
 
13      (i)  An annual report of the activities of the committee
 
14 shall be prepared by the committee and provided to the governor
 
15 and legislature not less than thirty days prior to the next
 
16 succeeding legislative session.  The report shall include a
 
17 summary of comments and recommendations made by the committee, by
 
18 participants in the public forums, and those elicited through
 
19 other associated public comment opportunities.  Approval of the
 
20 report shall be by a simple majority of the committee, and shall
 
21 provide an opportunity for those in the minority to attach a
 
22 minority report.
 
23      (j)  The members of the committee shall serve without
 

 
Page 7                                                     
                                     S.B. NO.           656
                                                        
                                                        

 
 1 compensation, but shall be reimbursed for expenses, including
 
 2 travel expenses, necessary for the performance of their duties;
 
 3 provided that all expenses incurred by the committee shall be
 
 4 provided through a portion of the funds allocated to the consumer
 
 5 advocate.
 
 6      (k)  The consumer advocate shall adopt rules pursuant to
 
 7 chapter 91 as may be necessary to effectuate the purposes of this
 
 8 section."
 
 9      SECTION 3.  Section 269-1, Hawaii Revised Statutes, is
 
10 amended by adding two new definitions to be appropriately
 
11 inserted and to read as follows:
 
12      ""Commission" means the public utilities commission.
 
13      "Committee" means the citizen review committee established
 
14 in section 269-   ."
 
15      SECTION 4.  Section 269-54, Hawaii Revised Statutes, is
 
16 amended by amending subsection (b) to read as follows:
 
17      "(b)  The consumer advocate [may:] shall:
 
18      (1)  Adopt rules pursuant to chapter 91 necessary to
 
19           effectuate the purposes of this part.
 
20      (2)  Conduct investigations to secure information useful in
 
21           lawful administration of any provision of this part.
 
22      (3)  Assist, advise, and cooperate with federal, state, and
 
23           local agencies and officials to protect and promote the
 

 
Page 8                                                     
                                     S.B. NO.           656
                                                        
                                                        

 
 1           interests of the consumer in the public utilities
 
 2           field.
 
 3      (4)  Study the operation of laws affecting all consumers,
 
 4           including small businesses, of utility services and
 
 5           recommend to the governor and the legislature new laws
 
 6           and amendments of laws in the consumers' interest in
 
 7           the public utilities field.  Each study shall
 
 8           incorporate, but not be limited to, the annual findings
 
 9           and recommendations of the citizen review committee, as
 
10           provided in section 269-   .
 
11      (5)  Organize and hold conferences, forums, or public
 
12           information sessions, on problems affecting consumers
 
13           of utility services.  One or more of these conferences,
 
14           forums, or public information sessions shall be
 
15           conducted during the designated annual period of
 
16           operation of the citizen review commission established
 
17           in section 269-   .
 
18      (6)  Perform such other acts as may be incidental to the
 
19           exercise of the functions, powers, and duties set forth
 
20           in this section.
 
21      (7)  Represent the interests of consumers of utility
 
22           services before any state or federal agency or
 
23           instrumentality having jurisdiction over matters which
 

 
Page 9                                                     
                                     S.B. NO.           656
                                                        
                                                        

 
 1           affect those interests.
 
 2      (8)  Consider and apply externalities costs, socioeconomic
 
 3           costs, cultural and historical impacts, and public
 
 4           policy considerations on an equal basis with direct
 
 5           costs for the utility services provided in
 
 6           deliberations and decisionmaking processes.  The
 
 7           citizen review committee, established in section
 
 8           269-   , shall assist the consumer advocate in
 
 9           developing the appropriate methodology to ensure
 
10           compliance with this section."
 
11      SECTION 5.  Statutory material to be repealed is bracketed.
 
12 New statutory material is underscored.
 
13      SECTION 6.  This Act shall take effect upon its approval.
 
14 
 
15                              INTRODUCED BY:______________________