Honorable Robert Bunda

President of the Senate

Twenty-Third State Legislature

Regular Session of 2005

State of Hawaii

Sir:

Your Committee on Energy, Environment, and International Affairs, to which was referred S.B. No. 1003 entitled:

begs leave to report as follows:

The purpose of this measure is to remove the limit on allowable customer-generator generating capacity under the net energy metering law, and to incrementally increase the percentage of the total energy generating capacity of an electric utility produced by eligible customer-generators.

Testimony supporting the measure was received from the Hawaii Renewable Energy Alliance and PowerLight Corporation. The Department of Commerce and Consumer Affairs and Hawaiian Electric Company submitted testimony in support of the measure but believed that it would be premature to amend the current net energy metering law at this time. The Public Utilities Commission and the Department of Business, Economic Development, and Tourism submitted comments.

Your Committee finds that the net energy metering program, which provides incentives to those who produce renewable energy fed into the power grid, needs to be further encouraged by making it easier for a customer-generator to participate in the program. In addition, your Committee believes that incremental increases in the percentage of an electric utility's generating capacity produced by customer-generators will provide a fair standard to follow while providing predictability to electric utilities for planning and implementation purposes.

Your Committee has amended this measure by amending the definition of "net energy metering" to change the billing period from a monthly to an annual basis.

As affirmed by the record of votes of the members of your Committee on Energy, Environment, and International Affairs that is attached to this report, your Committee is in accord with the intent and purpose of S.B. No. 1003, as amended herein, and recommends that it pass Second Reading in the form attached hereto as S.B. No. 1003, S.D. 1, and be referred to the Committee on Commerce, Consumer Protection, and Housing.