STAND. COM. REP. 3201

Honolulu, Hawaii

, 2004

RE: H.B. No. 2049

H.D. 1

S.D. 1

 

 

Honorable Robert Bunda

President of the Senate

Twenty-Second State Legislature

Regular Session of 2004

State of Hawaii

Sir:

Your Committees on Energy and Environment and Science, Arts, and Technology, to which was referred H.B. No. 2049, H.D. 1, entitled:

"A BILL FOR AN ACT RELATING TO ENERGY,"

beg leave to report as follows:

The purpose of this measure is to amend to statute governing energy retrofit and performance contracting for public facilities by:

(1) Increasing the allowable length of energy performance contracts from fifteen years to twenty years;

(2) Broadening the financing options for energy performance contracts;

(3) Replacing shared savings plans with guaranteed savings plans;

(4) Amending the definition of "energy performance contract" to include water saving technology retrofits; and

(5) Adding a definition for "financing agreement."

Testimony in support of the measure was submitted by the Director of Business, Economic Development, and Tourism; Managing Director of the City and County of Honolulu; Hawaii Renewable Energy Alliance; Hawaiian Electric Company, Inc.; Sierra Club, Hawai`i Chapter; Powerlight Solar Electric Systems; The League of Women Voters; and two individuals. The Conservation Council for Hawai`i; Maui Sierra Club; Affordable Solar Contracting; Respiratory & Environmental Disabilities Association of Hawaii; Na Leo Pohai, The Outdoor Circle; Melody Farm; Century 21, All Islands; DreamMakers Foundation, Maui Arts & Music Association, People Aligned in Positive Action; Pacific West Mortgage, Kulamanu Realty; The Surfrider Foundation; Life of the Land; Hawaii Wildlife Fund; and twenty individuals submitted comments on the measure.

Your Committees find an overwhelming majority of the testifiers requested the addition of a provision increasing the renewable portfolio standards for electric utility companies to the measure. Your Committees agree with those testifiers and also believe that the definition of "renewable energy" needs clarification and inclusion of seawater air conditioning district cooling systems and solar air conditioning. Your Committees further believe that the Public Utilities Commission should take measures to ensure that any revised renewable portfolio standards are properly implemented, monitored, and reviewed.

Accordingly, your Committees amended the measure by:

(1) Clarifying the definition of "renewable energy" in situations where renewable and nonrenewable means are used to produce fuels, and where fossil and renewable fuels are used to produce electricity;

(2) Including seawater air conditioning district cooling systems and solar air conditioning in the definition of "renewable energy";

(3) Amending the renewable portfolio standards for electric utility companies by revising the renewable energy standards for the years 2010, 2015, and 2020 to ten, twenty, and thirty per cent, respectively, of net electricity sales;

(4) Requiring the Public Utilities Commission to:

(A) Develop and implement a utility rate structure by December 31, 2006 to provide incentives for Hawaii's electric utility companies to meet the revised renewable portfolio standards;

(B) Study the impact of the new utility rate structure on electric utility companies' profit margins;

(C) Contract with third parties to evaluate the ability of electric utility companies to meet the revised renewable portfolio standards and make findings and recommendations for projected standards for five and ten years beyond the then current standard; and

(D) Report its finding and recommendations to the 2009 legislature and every five years thereafter; and

(5) Making technical, nonsubstantive changes for style and formatting.

As affirmed by the records of votes of the members of your Committees on Energy and Environment and Science, Arts, and Technology that are attached to this report, your Committees are in accord with the intent and purpose of H.B. No. 2049, H.D. 1, as amended herein, and recommends that it pass Second Reading in the form attached hereto as H.B. No. 2049, H.D. 1, S.D. 1, and be placed on the calendar for Third Reading.

Respectfully submitted on behalf of the members of the Committees on Energy and Environment and Science, Arts, and Technology,

____________________________

DAVID Y. IGE, Chair

____________________________

J. KALANI ENGLISH, Chair