SB644 HD3

SECTION 1. The legislature finds that Hawaii’s economic viability is dependent on the availability of affordable energy pricing. In early 2008, the price of crude oil surpassed the $l00 per barrel mark from the 2007 annual average of $65 per barrel, burdening Hawaii’s residents and businesses with increasingly high electricity and gasoline costs.

The legislature also finds that fossil fuel imports now account for a greater impact upon Hawaii’s economy than at any prior time in the past, substantially exceeding that of every other state despite the fact that we are blessed with the greatest number of renewable energy resources in the nation.

The legislature further finds that, with crude oil prices rising from $65 to over $100 per barrel in less than one year and with no relief under the State’s direct control and jeopardizing the State’s economic viability, the State must seriously consider requiring the installation of solar thermal systems to heat water in all new single-family dwellings constructed after December 31, 2009, to accelerate the installation of this type of energy saving device to benefit the owners and renters of newly constructed homes. A government mandate of this technology in new home construction effectively requires the private sector to jointly invest with the State so that the result will be greater benefits to the public at large through the prudent investment in this type of renewable energy saving device.

The legislature finds that a conventional electric water tank accounts for 30 to 35 per cent of a home’s electric bill. It is estimated that the savings from a home’s electricity bill through the installation of a solar thermal water heater system could result in the system being paid off in eight to ten years or less. Furthermore, if the expense of the installation of a solar thermal water heater system is included in the mortgage of a new home, given the high and unpredictable cost of oil, the savings from the lowered electricity costs may exceed the additional monthly payments for the solar thermal water heater system, which itself has the added benefit of being an allowable tax deductible expense that may also be eligible for a federal renewable energy tax credit. Therefore, the legislature finds that with a solar thermal water heater system mandate, and with a properly sized and installed solar thermal water heater system, a household can increase its disposable income through this type of prudent, energy saving investment.

The legislature further finds that the favorable impact of this policy on the environment is undeniable. In 2006, there were 5,700 new residences constructed; assuming that the number of new single-homes constructed remains approximately the same, this would amount to over 10,260 tons of greenhouse gas emissions avoided per year.

The purpose of this Act is to increase the use of renewable energy to protect our environment, reduce pollution, make housing more affordable, and enhance Hawaii’s local economy by requiring the installation of solar thermal water heater systems in all new residential projects.

SECTION 2. Chapter 196, Hawaii Revised Statutes, is amended by adding a new section to be appropriately designated and to read as follows:

"§196- Solar thermal water heater required for new single-family residential construction. (a) Beginning January 1, 2010, a solar thermal water heater shall be installed as the primary water heating system in the construction of every new residential detached single-family residence.

(b) Solar thermal water heaters required under subsection (a) shall be installed by a contractor licensed in this state in compliance with the residential solar thermal water heating system standards and specifications promulgated by any ratepayer financed energy efficiency rebate program administered by an electric utility or by the public benefits fund administrator under section 269-123, that are in effect at the time at which construction permits are issued for the construction of the new residential detached single-family residence. In the event that compliance with these standards and specifications is technically impracticable, as determined solely by the administrator of the ratepayer financed energy efficiency rebate program, the administrator may grant a waiver that results in the greatest contribution by the solar thermal water heater to the residential water heating load.

SECTION 3. Section 269-121, Hawaii Revised Statutes, is amended by amending subsection (b) to read as follows:

"(b) If the public utilities commission establishes a public benefit fund, the surcharge shall be known as the public benefits fee. Moneys in the fund shall be ratepayer funds that shall be used to support energy-efficiency and demand-side management programs and services, and to support compliance verification of a solar thermal water heater installed in the construction of every new residential single-family residence, subject to the review and approval of the public utilities commission. These moneys shall not be available to meet any current or past general obligations of the State.

SECTION 4. Section 269-123, Hawaii Revised Statutes, is amended to read as follows:

"[[]§269‑123[]] Requirements for the public benefits fund administrator. (a) Any fund administrator appointed pursuant to section 269-122 shall satisfy the qualification requirements established by the public utilities commission by rule or order. These requirements may include experience and expertise in:

(1) Energy-efficient and renewable energy technologies and methods; and

(2) Identifying, developing, administering, and implementing demand-side management and energy‑efficiency programs.

(b) The fund administrator's duties and responsibilities shall be established by the public utilities commission by rule or order, and may include:

(1) Identifying, developing, administering, promoting, implementing, and evaluating programs, methods, and technologies that support energy-efficiency and demand-side management programs;

(2) Encouraging the continuance or improvement of efficiencies made in the production, delivery, and use of energy-efficiency and demand-side management programs and services;

(3) Using the energy-efficiency expertise and capabilities that have developed or may develop in the [~~State~~] state and consulting with state agency experts;

(4) Promoting program initiatives, incentives, and market strategies that address the needs of persons facing the most significant barriers to participation;

(5) Promoting coordinated program delivery, including coordination with electric public utilities regarding the delivery of low-income home energy assistance, other demand-side management or energy-efficiency programs, and any utility programs;

(6) Consideration of innovative approaches to delivering demand-side management and energy-efficiency services, including strategies to encourage third party financing and customer contributions to the cost of demand-side management and energy-efficiency services; and

(7) Submitting, to the public utilities commission for review and approval, a multi-year budget and planning cycle that promotes program improvement, program stability, and maturation of programs and delivery resources.

(1) Maintaining or improving current residential solar thermal water heating system standards and specifications based on the performance, prescriptive, durability, longevity, and quality assurance standards and mechanisms first developed by Hawaiian Electric Company, Inc., including:

(A) Solar thermal water heater system design and sizing criteria that provide for a ninety per cent annualized solar contribution, not to exceed one hundred and ten per cent, and ensure that each solar thermal water heating system installation yields significant demand-side management benefits;

(B) A solar thermal water heater system design life of no less than fifteen years;

(C) Prescriptive standards and specifications governing solar thermal water heater system components and the installation of solar thermal water heater systems;

(D) An approved components and equipment list to ensure that solar thermal water heater system installations use only high quality durable and reliable components suitable for Hawaii’s environment; and

(E) A post-installation inspection regimen that ensures each solar thermal water heater system is installed in accordance with the performance guidelines, durability requirements, standards and specifications, and quality assurance mechanisms of this subsection;

(2) Verifying compliance with the standards and specifications under paragraph (1); and

(3) Determining the necessity for the convening of a technical advisory committee by the fund administrator or any electric utility, composed of representatives from the solar and building industries, electric utilities, and other stakeholders, to propose changes or to address any proposed changes to the residential solar thermal water heating system standards and specifications, and where necessary convening a technical advisory committee."

SECTION 5. Statutory material to be repealed is bracketed and stricken. New statutory material is underscored.

SECTION 6. This Act shall take effect July 1, 2020.

THE SENATE	S.B. NO.	644
TWENTY-FOURTH LEGISLATURE, 2008		S.D. 3
STATE OF HAWAII		H.D. 3