Honorable Robert Bunda

President of the Senate

Twenty-Second State Legislature

Regular Session of 2004

State of Hawaii

Sir:

Your Committee on Commerce, Consumer Protection and Housing, to which was referred H.B. No. 2048, H.D. 1, entitled:

begs leave to report as follows:

The purpose of this measure is to promote the use of renewable energy in Hawaii by increasing the maximum allowable generating capacity of an eligible customer-generator from ten kilowatts to fifty kilowatts and authorizing government entities to participate in net energy metering.

Testimony in support of this measure was received from the Department of Business, Economic Development, and Tourism, Public Utilities Commission, Consumer Advocate, City and County of Honolulu, Hawaii PV Coalition, Sierra Club, PowerLight Corporation, and Hawaii Renewable Energy Alliance. Kauai Island Utility Cooperative opposed the measure. Hawaiian Electric Company, Inc. expressed concerns about the measure.

Your Committee finds that increasing the maximum allowable generating capacity of an eligible customer-generator will facilitate the installation of increased numbers of non-fossil generating facilities serving residential customers, promote fuel diversity, and encourage investment in renewable resources. Additionally, authorizing government entities to participate in net energy metering will enable the use of renewable energy in public facilities, thereby reducing government operating costs and saving taxpayer moneys.

Currently, under section 269-111, Hawaii Revised Statutes, renewable energy systems that are in compliance with industry safety and performance standards are not required to install additional controls, perform or pay for additional tests, or purchase additional liability insurance. However, your Committee further finds that an increase in maximum allowable generating capacity for eligible customer-generators from ten kilowatts to fifty kilowatts may require an interconnection study relating to safety and reliability issues. Therefore, your Committee has amended this measure to limit this exemption from additional costs or requirements to systems of ten kilowatts or less.

As affirmed by the record of votes of the members of your Committee on Commerce, Consumer Protection and Housing that is attached to this report, your Committee is in accord with the intent and purpose of H.B. No. 2048, H.D. 1, as amended herein, and recommends that it pass Third Reading in the form attached hereto as H.B. No. 2048, H.D. 1, S.D. 1.