Bill Text: HI HB1593 | 2017 | Regular Session | Amended
Bill Title: Relating To Green Infrastructure.
Spectrum: Partisan Bill (Democrat 7-0)
Status: (Enrolled - Dead) 2017-04-27 - Conference Committee Meeting will reconvene on Friday 04-28-17 3:10PM in conference room 225. [HB1593 Detail]
Download: Hawaii-2017-HB1593-Amended.html
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HOUSE OF REPRESENTATIVES |
H.B. NO. |
1593 |
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TWENTY-NINTH LEGISLATURE, 2017 |
H.D. 1 |
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STATE OF HAWAII |
S.D. 1 |
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A BILL FOR AN ACT
RELATING TO GREEN INFRASTRUCTURE.
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF HAWAII:
SECTION 1. The legislature finds that the Hawaii green infrastructure loan program was established in 2013 to "serve as a potential source of capital for a range of clean energy technology users, including renters and residents that have not been able to take advantage of current financing programs and may now take advantage of increasing opportunities to install clean energy technology", according to the strongly supportive testimony of the public utilities commission.
The legislature furthers finds that a variety of executive branch departments and the Hawaiian Electric Companies testified in support of the program, explaining the potential benefits of a green infrastructure loan program and expressing a willingness to collaborate with one another to implement the program.
The department of business, economic development, and tourism testified that the program "will make low-cost credit available, including to the underserved markets - low to moderate income homeowners, renters, churches, non-profits - those who may not be able to access or afford clean energy installations today. One application of the program is that consumers will be able to install solar photovoltaic equipment and receive immediate benefits today, while amortizing the costs over time and paying for those benefits on their utility bill."
The consumer advocate testified in support of this program, noting that "on bill financing allows the consumer to pay for these energy systems through the electricity cost savings on their monthly bill . . . [T]he Consumer Advocate will work closely with DBEDT, the Hawaiian Electric Companies, the Public Utilities Commission, and all interested parties in designing an on bill financing program that minimizes the financial risk to electric utilities' ratepayers."
Hawaiian Electric Company testified that "the companies indicated their willingness to assist with billing, collecting, and transmitting customer payments related to on-bill financing" and that "the companies have been working with DBEDT and the PUC . . . [T]hat collaborative effort has resulted in language which the companies strongly support."
The legislature finds that despite the testimony, an on bill financing program has not yet been developed. Further, the small amount of funds deployed from the Hawaii green infrastructure loan program is dwarfed by the cost of the program's administration and debt service.
The legislature further finds that the failure of the Hawaii green infrastructure loan program to achieve its intended result has resulted in most ratepayers paying for the program without reaping the benefits. Rather than obtaining immediate relief from high electric power rates, ratepayers are instead having to pay the debt service on a loan that is not being effectively deployed. This is particularly true for low- to middle-income homeowners, renters, churches, and nonprofit organizations, the people and entities that the green infrastructure loan program was primarily intended to benefit. Moreover, all ratepayers are denied the benefits of wider deployment of clean energy and energy efficiency, including reduced reliance on fossil fuels, lower overall system costs, and economic and environmental benefits.
Accordingly, the purpose of this Act is to:
(1) Reduce some of the oversight of the green infrastructure loan program to encourage more rapid deployment of loans in furtherance of the intent of the program; and
(2) Directly assist Hawaii's underserved residents by using dormant funds from the Hawaii green infrastructure loan program to create the clean energy savings jump start program, with the intent of rapidly deploying funds to assist disadvantaged communities with investments in clean energy and energy efficiency.
SECTION 2. Chapter 196, Hawaii Revised Statutes, is amended by adding two new sections to part IV to be appropriately designated and to read as follows:
"§196-A Clean energy savings jump start program; clean energy savings jump start fund. (a) There is established a clean energy savings jump start program that shall be administered by the Hawaii green infrastructure authority in a manner consistent with this part. The authority, in collaboration with others, shall expend moneys on rebate and other programs that rapidly advance state goals of clean energy and energy efficiency, with a focus on serving low- and middle-income residents.
(b) The authority shall:
(1) Prepare any forms that may be necessary for the applicant to claim a rebate under this part;
(2) Require each applicant claiming a rebate under this part to furnish reasonable information to ascertain the validity of the claim, including but not limited to documentation necessary to demonstrate that the system or installation for which the rebate is claimed is eligible;
(3) Allow each applicant to establish income eligibility, as necessary, through a declaration asserting that the information provided is true and correct and made under penalty of law;
(4) Make best efforts to post on a publicly available website, within regular and reasonable periods of time, the current amounts remaining in the Hawaii clean energy savings jump start fund; and
(5) Establish guidelines necessary to effectuate the purposes of this section; provided that the establishment of guidelines shall not be subject to chapter 91; provided further that the authority's guidelines shall include procedures to allow an applicant to secure the applicable level of rebate after the purchase or lease of an applicable system, but prior to the system's installation, so long as the system is installed and placed into service within a reasonable time frame established by the authority.
(c) The authority may contract with a third party for services to assist with administering the clean energy savings jump start program. Procurement of services shall be exempt from the requirements of chapter 103D.
(d) There is established a special fund to be known as the clean energy savings jump start fund, into which shall be deposited appropriations from the legislature.
(e) Moneys in the clean energy savings jump start fund shall be used for the following purposes:
(1) Making jump start program payments pursuant to this part, which may include but not be limited to rebates, energy education, energy demonstration projects for affordable multi-family rental projects, and credit enhancements, such as loan loss reserves and interest rate buy-downs;
(2) Paying the authority's administrative costs for operating the clean energy savings jump start program; and
(3) Paying the authority's administrative costs for operating the clean energy savings jump start fund.
§196-B Energy storage system rebate program. (a) Notwithstanding any other law to the contrary, the authority shall establish a rebate program within the clean energy savings jump start program that incentivizes the installation of energy storage systems that installed concurrently with solar photovoltaic systems and are connected to a utility grid.
(b) An energy storage system owner who provides third-party financing to an energy storage system user, or purchases and installs in this State an eligible energy storage system, may apply to the authority within twelve months of the eligible energy storage system being first placed into service to claim a rebate from the energy storage system fund. Rebates shall be distributed as follows:
(1) Each eligible residential energy storage system shall receive the lesser of cents per watt-hour of the system's warranted capacity of stored energy or the cap amount determined in subsection (c);
(2) Each eligible commercial energy storage system shall receive the lesser of cents per watt-hour of the system's warranted capacity of stored energy or the cap amount determined in subsection (c);
(3) Each eligible utility-scale energy storage system shall receive the lesser of cents per watt-hour of the system's warranted capacity of stored energy or the cap amount determined in subsection (c); and
(4) No more than $ of the energy storage system fund may be expended on utility-scale energy storage systems, and no more than $ of the energy storage system fund may be expended on commercial energy storage systems.
(c) The amount of rebate allowed for each eligible energy storage system shall not exceed the applicable cap amount, which shall be:
(1) $ per system for single-family residential property; provided that:
(A) If the combined federal adjusted gross income of household members of the energy storage system user is $75,000 or less for single filers, or $150,000 or less for joint filers, in the preceding tax year in which the rebate is claimed, then the energy storage system property owner shall be eligible to receive per cent of the rebate;
(B) If the combined federal adjusted gross income of household members of the energy storage system user is greater than $75,000 but less than $150,000 for single filers, or is greater than $150,000 but less than $300,000 for joint filers, in the preceding tax year in which the rebate is claimed, then the energy storage system property owner shall be eligible to receive per cent of the rebate; or
(C) If the combined federal adjusted gross income of household members of the energy storage system user is greater than $150,000 for single filers, or greater than $300,000 for joint filers, in the preceding tax year in which the rebate is claimed, then the energy storage system property owner is eligible to receive per cent of the rebate;
(2) $ per system for commercial property; and
(3) $ per system for utility-scale energy storage systems; provided that the system is co-sited and electrically connected to an eligible community-based renewable energy project.
(d) This section shall apply to eligible energy storage systems that are installed and first placed in service after December 31, 2017.
(e) The energy storage system rebate program established by this section shall be a three-year pilot program that shall operate from January 1, 2018, to December 31, 2020. The authority shall submit an annual report detailing the pilot program's progress and activities, including details of all rebates distributed in accordance with the pilot program, to the legislature no later than twenty days prior to the convening of each regular session.
(f) Nothing in this section shall alter taxes due on the original purchase price of an eligible energy storage system prior to the application of this rebate. Any rebate received pursuant to the energy storage system rebate program shall not be considered income for the purposes of state or county taxes."
SECTION 3. Section 196-61, Hawaii Revised Statutes, is amended by adding four new definitions to be appropriately inserted and to read as follows:
""Eligible energy storage system" means any identifiable facility, equipment, or apparatus that:
(1) Receives electricity generated from a solar photovoltaic system, stores the electricity within a chemical battery or mechanical battery, such as flywheel energy storage, and delivers the energy back at a later time to the energy storage system user, an electric utility, or the Hawaii electric system;
(2) Is fixed to a residential or commercial property and electrically connected to an energy storage system user's load or generation, or in the case of a utility-scale energy storage system, is fixed to a property and electrically connected to an eligible community-based renewable energy project;
(3) Has a deployable capacity of at least 2.5 kilowatts of continuous battery charge and discharge power and at least five kilowatt-hours of stored energy at time of purchase for residential and commercial energy storage systems;
(4) Has a minimum deployable capacity of 2.5 megawatt-hours and five megawatt-hours at time of purchase for utility-scale energy storage systems;
(5) Is protected by a manufacturer's warranty of at least ten years or a minimum of three thousand cycles for residential and commercial energy storage systems;
(6) Is protected by a manufacturer's warranty of at least twenty years with a degradation not to exceed 1.5 per cent per year and controls sufficient to provide real power and reactive power dispatch for utility-scale energy storage systems;
(7) Is not owned by an electric utility; and
(8) Is connected to an electric utility grid.
"Energy storage system property owner" means the person, individual, partnership, corporation, association, or public or private organization other than an agency that holds legal title to the energy storage system. An energy storage system property owner shall include the owner of third-party financed energy storage systems.
"Energy storage system user" means the property owner, or the property owner's lessees or tenants, that use the energy discharged by the eligible energy storage system on the property where the eligible energy storage system is located or on contiguous property owned or leased by the property owner without regard to interruptions in contiguity caused by easements, public thoroughfares, transportation rights-of-way, and utility rights-of-way.
"First placed in service" has the
same meaning as title 26 Code of Federal Regulations section 1.167(a)-11(e)(1),
as amended."
SECTION 4. Section 196-61, Hawaii Revised Statutes, is amended as
follows:
1. By amending the definition of "loan program" and "green infrastructure loans" to read:
""Loan
program" and "green infrastructure loans" means the program
established by this part and loans made to finance the purchase or installation
of green infrastructure equipment for clean energy technology, demand response
technology, and energy use reduction and demand side management infrastructure,
programs, and services [as authorized by the public utilities commission]
using the proceeds of bonds or other proceeds."
2. By deleting the definition of "green infrastructure loan program order".
[""Green
infrastructure loan program order" means the same as defined in section
269-161."]
SECTION 5. Section 196-64, Hawaii Revised Statutes, is amended by amending subsection (a) to read as follows:
"(a) In
the performance of, and with respect to the functions, powers, and duties
vested in the authority by this part, the authority, as directed by the
director [and in accordance with a green infrastructure loan program order
or orders under section 269-171 or an annual plan submitted by the authority
pursuant to this section, as approved by the public utilities commission],
may:
(1) Make loans and expend funds to finance the purchase or installation of green infrastructure equipment for clean energy technology, demand response technology, and energy use reduction and demand side management infrastructure, programs, and services;
(2) Hold and invest
moneys in the green infrastructure special fund in investments as permitted by
law [and in accordance with approved investment guidelines established in
one or more orders issued by the public utilities commission pursuant to
section 269-171];
(3) Hire employees necessary to perform its duties, including an executive director. The executive director shall be appointed by the authority, and the employees' positions, including the executive director's position, shall be exempt from chapter 76;
(4) Enter into contracts for the service of consultants for rendering professional and technical assistance and advice, and any other contracts that are necessary and proper for the implementation of the loan program;
(5) Enter into contracts for the administration of the loan program, without the necessity of complying with chapter 103D;
(6) Establish loan
program guidelines [to be approved in one or more orders issued by the
public utilities commission pursuant to section 269-171] to carry out the
purposes of this part;
(7) Be audited at least annually by a firm of independent certified public accountants selected by the authority, and provide the results of this audit to the department and the public utilities commission; and
(8) Perform all functions necessary to effectuate the purposes of this part."
SECTION 6. Section 196-65, Hawaii Revised Statutes, is amended to read as follows:
"[[]§196-65[]] Hawaii green infrastructure special
fund. (a) There is
established the Hawaii green infrastructure special fund into which shall be
deposited:
(1) The proceeds of bonds net of issuance costs and reserves or overcollateralization amounts;
(2) Green infrastructure charges received for the use and services of the loan program, including the repayment of loans made under the loan program;
(3) All other funds received by the department or the authority and legally available for the purposes of the green infrastructure special fund;
(4) Interest earnings on all amounts in the green infrastructure special fund; and
(5) [Such other]
Other moneys as shall be permitted by an order of the [public
utilities commission.] authority.
The Hawaii green infrastructure special fund
shall not be subject to section 37-53. Any amounts received from green
infrastructure charges or any other net proceeds earned from the allocation,
use, expenditure, or other disposition of amounts [approved by the public
utilities commission] and deposited or held in the Hawaii green
infrastructure special fund in excess of amounts necessary for the purposes of subsection
(b) shall be credited to electric utility customers [as provided in a green
infrastructure loan program order or orders]. Funds that are transferred
back to the electric utility in order to credit electric utility customers
under this subsection shall not be considered revenue of the electric utility
and shall not be subject to state or county taxes.
(b) Moneys in the Hawaii green infrastructure
special fund may be used[, subject to the approval of the public utilities
commission,] for the purposes of:
(1) Making green infrastructure loans;
(2) Paying administrative costs of the Hawaii green infrastructure loan program;
(3) Paying any other costs related to the Hawaii green infrastructure loan program; or
(4) Paying financing costs, as defined in section 269-161, to the extent permitted by the public utilities commission in a financing order issued pursuant to section 269-163.
(c) The
authority may invest funds held in the Hawaii green infrastructure special fund
in investments as permitted by law[, and in accordance with approved investment guidelines
established in one or more orders issued by the public utilities commission
pursuant to section 269-171]. All amounts in the Hawaii green infrastructure special
fund shall be exempt from all taxes and surcharges imposed by the State or the
counties."
SECTION 7. Section 196-66, Hawaii Revised Statutes, is amended to read as follows:
"[[]§196-66[]] Use
of Hawaii green infrastructure special fund[; application]. [(a) The authority shall apply to the public
utilities commission for one or more orders to effectuate the Hawaii green
infrastructure loan program, pursuant to section 269-170.
Nothing herein shall preclude the department
from applying for a financing order, pursuant to section 269-162, prior to the
issuance of an order or orders to effectuate the Hawaii green infrastructure
loan program under section 269-171, nor from requesting consolidation of the
proceeding for a financing order with such a loan program implementation order.
(b) An application shall be submitted by
the authority to the public utilities commission in accordance with section 269‑170.
(c) In accordance with an approved green
infrastructure loan program order or orders, the] (a) The authority
shall utilize the proceeds of bonds and other amounts deposited in the Hawaii
green infrastructure special fund pursuant to [[]section[]]
196-65, or to the extent permitted by a financing order, to pay financing
costs, as defined in section 269-161.
[(d) Within the order or orders issued by
the public utilities commission under section 269-171, the] (b) The
authority shall obtain approval from the public utilities commission requiring
the electric utilities to serve as agents to bill and collect the green
infrastructure charge imposed to repay green infrastructure costs and transfer
all green infrastructure charges collected to the authority on behalf of the
department. Notwithstanding anything to the contrary, electric utilities shall
not be obligated to bill, collect, or remit green infrastructure charges from
nonutility customers."
SECTION 8. Section 269-161, Hawaii Revised Statutes, is amended by deleting the definition of "green infrastructure loan program order".
[""Green infrastructure loan
program order" means an order issued by the public utilities commission
under section 269-171 that establishes the use or other disposition of amounts
deposited and held in the Hawaii green infrastructure special fund pursuant to
section 196-65."]
SECTION 9. Section 269-170, Hawaii Revised Statutes, is repealed.
["[§269-170] Green
infrastructure loan program order; application. (a) The authority shall submit
an application to the public utilities commission for the use or other
disposition of amounts deposited or held in the green infrastructure special
fund pursuant to section 196-65 prior to the allocation, use, expenditure, or
other disposition of any such amounts; provided that this subsection shall not
apply to the expenditure of amounts deposited or held in the green
infrastructure special fund that have been reviewed and approved by the public
utilities commission for operational or administrative expenses of the
authority pursuant to section 196-64.
(b) An application submitted by the
authority to the public utilities commission under this section shall include
the following:
(1) A description of each project, program,
financing agreement, or other arrangement for which the authority seeks to
allocate, use, expend, or otherwise dispose of amounts deposited or held in the
green infrastructure special fund, including:
(A) The clean energy technology,
demand response technology, and energy use reduction and demand side management
infrastructure, programs, and services to be financed;
(B) A
description of the parties, both direct and incidental, intended to benefit
from any financing made in connection with the green infrastructure special
fund amounts requested by the authority in an application submitted to the
public utilities commission under this section;
(C) A description of the loan programs or other
arrangements designed, established, identified, agreed to, agreed to in
principle, continued, carried over, or otherwise intended to be effectuated for
the use of the green infrastructure special fund amounts requested by the
authority in an application submitted to the public utilities commission under this section; and
(D) Any and all funding or credit
sources identified, pledged, dedicated, or otherwise provided to supplement the
green infrastructure special fund amounts requested by the authority in an
application submitted to the public utilities commission under this section;
(2) Minimum lending, crediting, or
investing criteria in relation to each project, program, financing agreement,
or other arrangement described in an application submitted to the public
utilities commission under this section;
(3) A description of the repayment processes,
mechanisms, and applicable calculations for each project, program, financing
agreement, or other arrangement described in an application submitted to the
public utilities commission under this
section;
(4) An explanation of the anticipated impacts and benefits to electric utility ratepayers
of any project, program, financing agreement, or other arrangement described
under an application submitted by the authority to the public utilities
commission under this section; and
(5) Any other additional information
determined to be necessary by the public utilities commission upon the review
of an application submitted or resubmitted by the authority under this section."]
SECTION 10. Section 269-171, Hawaii Revised Statutes, is repealed.
["[§269-171] Green infrastructure
loan program order; issuance. (a) The public utilities commission
may issue a program order authorizing the allocation, use, expenditure, or
other disposition of any amounts deposited or held in the green infrastructure
special fund upon the submission by the authority to the commission of a
completed application, as described in this section. A green infrastructure
loan program order issued by the public utilities commission shall include the
following, where determined necessary and applicable by the commission:
(1) An identification and description of
each project, program, financing agreement, or other arrangement approved by
the public utilities commission for which amounts deposited or held in the
green infrastructure special fund may be
allocated, used, expended, or otherwise disposed of;
(2) Minimum criteria for the lending,
crediting, or investing of amounts deposited or held in the green
infrastructure special fund;
(3) A description of the repayment
processes, mechanisms, and applicable calculations for each project, program,
financing agreement, or other arrangement approved by the public utilities
commission for which amounts deposited or held in the green infrastructure
special fund may be allocated, used, expended, or otherwise disposed of;
(4) A review of the anticipated impacts and
benefits to electric utility ratepayers of any project, program, financing
agreement, or other arrangement approved under a green infrastructure loan
program order; and
(5) Any other provision or information
determined to be necessary by the public utilities commission.
(b) The public utilities commission shall issue
an order under this section as expeditiously as possible upon the
receipt from the authority of a completed application submitted pursuant to
section 269-170.
(c) The order shall specify the following,
including:
(1) The procedures to be followed by the
electric utilities in the event of nonpayment or partial payment of the green
infrastructure charge by the electric utilities' customers, which procedures
shall be consistent with the public utilities commission's approved procedures
for nonpayment and partial payment of rates, charges, and fees under the
electric utilities' tariffs; and
(2) The distribution of the total amounts
collected by the electric utilities for amounts billed to customers for the
electric utilities' rates, fees, and charges, for the green infrastructure
charge, for other fees and charges approved by the public utilities commission,
and for associated taxes, in the event of partial payments of the billed
amounts.
The electric utilities serving as billing
and collecting agents shall be parties to the proceedings in which the order or
orders are issued."]
SECTION 11. (a) The legislature finds and declares that the benefits of the clean energy savings jump start program, which may include but not be limited to the issuance of rebates, energy education, energy demonstration projects for affordable multi-family rental projects, and credit enhancements under this Act is in the public interest and for the public health, safety, and welfare.
(b) The department of business, economic development, and tourism, and the green infrastructure authority embedded within the department, shall use the moneys appropriated pursuant to section 12 of this Act for the purposes of section 196-A, Hawaii Revised Statutes.
(c) To the extent there is any conflict between this Act and part III of chapter 39, Hawaii Revised Statutes, this Act shall prevail.
SECTION 12. There is appropriated out of the Hawaii green infrastructure special fund established pursuant to section 196‑65, Hawaii Revised Statutes, or any other eligible funds procured by the Hawaii green infrastructure authority, the sum of $20,000,000 or so much thereof as may be necessary for fiscal year 2017-2018 to be deposited into the clean energy savings jump start fund established pursuant to section 196-A, Hawaii Revised Statutes.
SECTION 13. There is appropriated out of the clean energy savings jump start program fund, the sum of $10,000,000 or so much thereof as may be necessary for fiscal year 2017-2018 for the energy storage system rebate program.
The sum appropriated shall be expended by the Hawaii green infrastructure authority for the purposes of this Act.
SECTION 14. In codifying the new sections added by section 2 of this Act, the revisor of statutes shall substitute appropriate section numbers for the letters used in designating the new sections in this Act.
SECTION 15. If any provision of this Act, or the application thereof to any person or circumstance, is held invalid, the invalidity does not affect other provisions or applications of the Act that can be given effect without the invalid provision or application, and to this end the provisions of this Act are severable.
SECTION 16. Statutory material to be repealed is bracketed and stricken. New statutory material is underscored.
SECTION 17. This Act shall take effect on January 28, 2081.
Report Title:
Green Infrastructure Authority; PUC; Loan Program; Clean Energy Savings; Energy Storage System Rebate Pilot Program; Appropriation
Description:
Establishes the Clean Energy Savings Jump Start Program and Clean Energy Savings Jump Start Fund. Establishes the Energy Storage System Rebate Program as a three-year pilot program and requires the Green Infrastructure Authority to submit annual reports to the legislature on the program's progress and activities. Deletes the Public Utilities Commission's approval authority relative to the Green Infrastructure Loan Program. Appropriates funds. Effective 1/28/2081. (SD1)
The summary description of legislation appearing on this page is for informational purposes only and is not legislation or evidence of legislative intent.
