Honorable Robert Bunda

President of the Senate

Twenty-First State Legislature

Regular Session of 2002

State of Hawaii

Sir:

Your Committee on Ways and Means, to which was referred S.B. No. 2802, S.D. 1, entitled:

begs leave to report as follows:

The purpose of this measure is to include renewable energy producers as parties to whom the Board of Land and Natural Resources may lease public lands through direct negotiations.

Your Committee finds that the Board of Land and Natural Resources presently may lease public lands by direct negotiation to public utilities, including electric utility companies, but not to renewable energy producers who provide power to the electric utility companies. As a result, public lands can only be leased to these entities via public auction.

Your Committee finds that the uncertainty of securing a land lease during the project development phase discourages the development of renewable energy projects on public lands. Your Committee further finds that this measure, by removing this uncertainty, will encourage the development of renewable energy projects and reduce the State's dependence on fossil fuels, in accordance with the State's energy policy.

Your Committee notes that the federal government, as well as many mainland states and municipalities, allow for direct negotiation to renewable energy producers.

Your Committee has amended the measure by making technical, nonsubstantive changes for purposes of style, clarity, and consistency.

As affirmed by the record of votes of the members of your Committee on Ways and Means that is attached to this report, your Committee is in accord with the intent and purpose of S.B. No. 2802, S.D. 1, as amended herein, and recommends that it pass Third Reading in the form attached hereto as S.B. No. 2802, S.D. 2.