STAND. COM. REP. NO. 2521

Honolulu, Hawaii

RE: S.B. No. 2821

S.D. 1

Honorable Ronald D. Kouchi

President of the Senate

Thirtieth State Legislature

Regular Session of 2020

State of Hawaii

Sir:

Your Committee on Energy, Economic Development, and Tourism, to which was referred S.B. No. 2821 entitled:

"A BILL FOR AN ACT RELATING TO RENEWABLE ENERGY TAX CREDITS,"

begs leave to report as follows:

The purpose and intent of this measure is to, beginning January 1, 2025, eliminate the renewable energy technologies income tax credit for solar energy systems that are not used to heat water for multi-family resident and commercial properties.

Your Committee received testimony in support of this measure from 174 Power Global. Your Committee received testimony in opposition to this measure from the Hawaii PV Coalition; Environmental Caucus of the Democratic Party of Hawaii; Climate Protectors Coalition; Our Revolution Hawaii; Tesla; We Are One, Inc; 350Hawaii; and seventeen individuals. Your Committee received comments on this measure from the Department of Taxation, Hawaii State Energy Office, Tax Foundation of Hawaii, ADON Renewables, and Ulupono Initiative.

Your Committee finds that Act 207, Session Laws of Hawaii 2003, established the renewable energy technologies tax credit to incentivize residential and commercial properties to install renewable energy technology in an attempt to bring the State closer to its one hundred percent renewable energy by 2045. Your Committee further finds that it has been seventeen years since the establishment of the renewable energy technologies tax credit and that the installation of solar energy systems has decreased, thereby decreasing the need for a solar energy tax credit. Your Committee believes that it is time to start investing in new and innovative renewable sources of energy outside the scope of solar energy. This measure will open opportunities for the State to begin investing in other new and innovative sources of renewable energy by eliminating the renewably energy technologies tax credit for certain solar energy systems.

Your Committee has amended this measure by:

(1) Eliminating the renewable energy technologies income tax credit for solar energy systems that the primary purpose is not to heat water for a single-family residential property after December 31, 2024;

(2) Increasing the renewable energy technologies tax credit for certain solar energy systems for a multi-family residential property to $750; and

(3) Providing that a power purchase agreement for commercial properties that was approved by the Public Utilities Commission prior to December 31, 2019, shall continue receiving the tax credit regardless of any amendments made to the renewable energy technologies tax credit law.

As affirmed by the record of votes of the members of your Committee on Energy, Economic Development, and Tourism that is attached to this report, your Committee is in accord with the intent and purpose of S.B. No. 2821, as amended herein, and recommends that it pass Second Reading in the form attached hereto as S.B. No. 2821, S.D. 1, and be referred to your Committee on Ways and Means.

Respectfully submitted on behalf of the members of the Committee on Energy, Economic Development, and Tourism,

________________________________

GLENN WAKAI, Chair