Honorable Robert Bunda

President of the Senate

Twenty-Second State Legislature

Regular Session of 2003

State of Hawaii

Sir:

Your Committee on Energy and Environment, to which was referred H.C.R. No. 172, H.D. 1, entitled:

begs leave to report as follows:

The purpose of this measure is to request the Consumer Advocate to form an ad hoc advisory group to investigate and make recommendations regarding the development and implementation of standard offer contracts and standardized interconnection agreements to reduce the approval process time for the implementation of renewable energy systems, and to facilitate the purchase of electricity from renewable energy producers in Hawaii.

Testimony supporting this measure was submitted by the Public Utilities Commission, Sierra Club Hawaii Chapter, Hawaii Renewable Energy Alliance, Scheibert Energy Company, Life of the Land, and ten individuals. The Department of Commerce and Consumer Affairs and Hawaiian Electric Company, Inc. submitted comments on this measure.

Your Committee finds that the lack of a standard power purchase agreement has been cited numerous times by renewable energy producers who are trying to do business in Hawaii and reduce Hawaii's dependence on imported fossil fuels. With a large utility providing the majority of electrical power, it is a challenge for small renewable producers to do business in the State. A standard power purchase contract would send a clear, public market signal to those who wish to invest in renewable projects in Hawaii. They will see what the requirements, expectations, terms, and compensation would be to invest in Hawaii. Today, such information is only known and discussed behind closed doors.

In addition, your Committee finds that it may be difficult to gather some of the information that the Consumer Advocate is directed to collect to create a spreadsheet because the information is not necessarily a part of the public record. Therefore, it is recommended that information be included in the spreadsheet as it becomes public.

As affirmed by the record of votes of the members of your Committee on Energy and Environment that is attached to this report, your Committee concurs with the intent and purpose of H.C.R. No. 172, H.D. 1, and recommends its adoption.