Bill Text: HI HB2724 | 2018 | Regular Session | Amended

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Bill Title: Relating To State Energy Agencies.

Spectrum: Moderate Partisan Bill (Democrat 9-1)

Status: (Engrossed - Dead) 2018-03-13 - Re-Referred to TRE/GVO, WAM. [HB2724 Detail]

Download: Hawaii-2018-HB2724-Amended.html

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HOUSE OF REPRESENTATIVES	H.B. NO.	2724
TWENTY-NINTH LEGISLATURE, 2018		H.D. 1
STATE OF HAWAII

A BILL FOR AN ACT

 

 

RELATING TO STATE ENERGY AGENCIES.

 

 

BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF HAWAII:

 

     SECTION 1.  The legislature finds that energy composes approximately one-eighth of Hawaii's overall economy.  Electric bills for public facilities and public transportation services exceeds $400,000,000 annually.  Management and direction of the energy sector of our economy is becoming an increasingly complex and critically important job.  According to Hawaii's utilities, successfully achieving one hundred per cent renewable electricity by 2045 is expected to save nearly $6,000,000,000.  Additionally, electric vehicles are already cheaper to operate than traditional gas-powered vehicles.  Transitioning to clean transportation will save residents billions of dollars.  Climate change is expected to cost the State at least $19,000,000,000 in losses from sea level rise alone, making the switch to renewable energy and the ultimate reduction of atmospheric carbon a priority.  The State must also handle the need for island resiliency; rapid increase and economic viability of renewable and distributed energy resources; the digitization, democratization, and inter-connectivity of infrastructure; and the electrification and automation of transportation.  These complex realities reveal the need for a state agency responsible for assisting the transition to a clean energy economy to meet Hawaii's climate and cost–of-living goals.

     The legislature further finds that efforts taken by the universities, public schools, executive departments, and other government entities have already begun to save taxpayer money by reducing the government's electricity costs.  However, those efforts lack statewide coordination, preventing economies of scale to maximize savings.  While some departments have made substantial progress, others have yet to commence meaningful activities.  Tasking a single agency to plan for energy savings measures across all public facilities and assist government entities already working to reduce energy costs is a necessary step to maximize taxpayer savings.

     The legislature further finds that although the state energy office is tasked with the responsibility of overseeing one-eighth of Hawaii's economy, which impacts every business and household, the state energy office lacks an enabling statute, a mission, formal guidance, and reporting accountability.  Additionally, appointment of the head of the state energy office, the Hawaii state energy office administrator, is exempt from the standard senate confirmation process required for the majority of other agency heads.

     The purpose of this Act is to establish in statute an energy agency with a clear mission, established guidance, transparent reporting, and accountable leadership that will assist both the public and private sectors in achieving the State's energy goals.  More specifically, this Act:

     (1)  Establishes the office of clean energy within the department of business, economic development, and tourism for administrative purposes only;

     (2)  Transfers the duties and responsibilities of the energy resources coordinator, which are currently assigned to the director of business, economic development, and tourism, to the director of the office of clean energy; and

     (3)  Transfers the functions of the state energy office to the office of clean energy.

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

"Part    .  Office of clean energy

     §196-A  Office of clean energy; established.  (a)  There is established the office of clean energy, within the department of business, economic development, and tourism for administrative purposes, to be responsible for advancing energy efficiency, renewable energy, and clean transportation to help achieve a resilient clean energy economy that sequesters more atmospheric carbon and greenhouse gases than it produces as quickly as practicable, but no later than 2045.

     (b)  The office of clean energy shall:

     (1)  Provide analysis and planning to actively develop and inform policies to achieve clean energy goals and energy resiliency at the legislature, public utilities commission, and other relevant stakeholders;

     (2)  Lead efforts to incorporate energy efficiency and renewable energy to reduce costs and achieve clean energy goals across all public facilities;

     (3)  Provide clean energy project deployment facilitation to assist private sector project completion when aligned with state clean energy goals; and

     (4)  Engage the private sector to help lead efforts to achieve clean energy goals through the Hawaii clean energy initiative advisory board.

     (c)  The office of clean energy shall be the State's primary government entity for supporting the clean energy initiative.

     (d)  No later than twenty days prior to the convening of each regular session, the office of clean energy shall submit a report to the legislature that includes:

     (1)  A description of the activities of the office of clean energy in response to the directives established pursuant to subsection (b) and section 196-B(d), along with the progress in meeting any of the office of clean energy goals established in or pursuant to this part;

     (2)  Progress by the State in meeting its clean energy goals; and

     (3)  Proposed legislation, if any.

     §196-B  Director of the office of clean energy; duties.  (a)  The office of clean energy shall be led by the director of the office of clean energy appointed by the governor, subject to confirmation by the senate; provided that the term of the director of the office of clean energy shall be coterminous with the term of the governor.  The director of the office of clean energy shall report directly to the governor.

     (b)  The director of the office of clean energy shall have:

     (1)  Training or experience in the field of renewable energy or other another related field;

     (2)  Expertise in policy, programs, or services related to renewable energy; and

     (3)  Experience in a supervisory or administrative capacity.

     (c)  The director of the office of clean energy shall be included in any benefit program generally applicable to officers and employees of the State.  The director of the office of clean energy may hire staff as may be necessary in accordance with chapter 76.

     (d)  Subject to the approval of the governor, the director of the office of clean energy shall:

     (1)  Formulate plans, objectives, criteria to measure accomplishment of objectives, programs through which the objectives are to be attained, and financial requirements for the optimum development of Hawaii's energy resources in a manner that achieves Hawaii's clean energy goals;

     (2)  Conduct systematic analysis of existing and proposed energy resource programs, evaluate the analysis conducted by government agencies and other organizations, and recommend programs that represent the most effective allocation of resources for the development of energy resources in a manner that achieves Hawaii's clean energy goals;

     (3)  Formulate and recommend specific proposals, as necessary, for conserving energy resources, including the allocation and distribution thereof;

     (4)  Assist public and private agencies in implementing energy conservation and efficiency programs, the development of indigenous energy resources, and related measures;

     (5)  Coordinate the State's energy programs with those of the federal government, other state governments, governments of nations with interest in common energy resources, and the political subdivisions of the State;

     (6)  Develop programs to encourage private and public exploration, research, and development of indigenous energy resources that will benefit the State;

     (7)  Conduct public education programs to inform the public of the energy resources situation, as it may exist, from time to time and of the government actions taken;

     (8)  Serve as consultant to the governor, public agencies, and private industry on energy-related matters;

     (9)  Contract for services when required for the implementation of this chapter;

    (10)  Review proposed state actions that the director of the office of clean energy finds to have significant effect on the State's clean energy objectives and report to the governor their effect on the energy program, and perform other services as may be required by the governor and the legislature;

    (11)  Prepare and submit reports as requested by the governor or the legislature;

    (12)  Assist public and private agencies in identifying and accessing data necessary to enable the development of a competitive renewable energy market and technologies in a manner that prioritizes resiliency and achieves Hawaii's clean energy goals;

    (13)  Assist public and private agencies in identifying projects or infrastructure required to accommodate and facilitate the development of renewable energy resources in a manner that prioritizes resiliency and achieves Hawaii's clean energy goals;

    (14)  Assist public and private agencies, in coordination with the department of budget and finance, in accessing the use of special purpose revenue bonds to finance the engineering, design, and construction of transmission projects and infrastructure that are deemed critical to the development of renewable energy resources in a manner that prioritizes resiliency and achieves Hawaii's clean energy goals;

    (15)  Develop the criteria or requirements for identifying and qualifying specific projects and infrastructure that are critical to the development of renewable energy resources, including providing assistance in accessing the use of special purpose revenue bonds to finance the projects or infrastructure;

    (16)  Develop and maintain a comprehensive and systematic quantitative and qualitative capacity to analyze the status of energy resources, systems, and markets, both in-state and those to which Hawaii is directly linked, particularly in relation to the State's economy, and to recommend, develop proposals for, and assess the effectiveness of policy and regulatory decisions, and conduct energy resiliency and emergency planning;

    (17)  Engage the general public and consider feedback as appropriate; and

    (18)  Adopt rules, pursuant to chapter 91, necessary to effectuate the purposes of this part."

     SECTION 3.  Section 196-1, Hawaii Revised Statutes, is amended to read as follows:

     "§196-1  Findings and declaration of necessity.  The legislature finds that:

     (1)  The global demand for petroleum and its derivatives has resulted in a significant and fundamental market escalation in oil prices, has caused severe economic hardships throughout the State, and threatens to impair the public health, safety, and welfare.

              The State of Hawaii, with its [near total] significant dependence on imported fossil fuel, is particularly vulnerable to dislocations in the global energy market.  This situation can be changed, as there are few places in the world so generously endowed with natural energy: geothermal, solar radiation, ocean temperature differential, wind, biomass, waves, and currents, [which] that are all potential non-polluting power sources[;].

              Renewable energy derived from these resources has already begun to create new opportunities for jobs in Hawaii and provide savings by avoiding the cost of importing more expensive fossil fuels.  The State is also subject to the impacts of global climate change caused by increasing atmospheric carbon and greenhouse gas emissions that are contributing to rising sea levels and loss of coastal lands and infrastructure, ocean acidification and loss of coral reefs, decreasing rainfall and fresh water resources, increasing temperatures and invasive species, and greater risk from hurricanes of higher intensity and frequency.

              It is therefore necessary to move beyond fossil-fuel energy resources as quickly as is reasonably practicable, while leveraging new jobs, opportunities, and financing created by the potential to deploy renewable energy and to sequester greenhouse gases and atmospheric carbon, and achieve a resilient clean energy economy that sequesters more atmospheric carbon and greenhouse gas than it produces as quickly as practicable, but no later than 2045;

     (2)  There is a real need for comprehensive strategic planning in the effort towards achieving full use of Hawaii's energy resources and the most effective allocation of energy resources throughout the State.  Planning is necessary and desirable in order that the State may recognize and declare the major problems and opportunities in the field of energy resources.  Both short-range and long-range planning will permit the articulation of:

          (A)  Broad policies, goals, and objectives;

          (B)  Criteria for measuring and evaluating accomplishments of objectives;

          (C)  Identification and implementation of programs that will carry out [such] the objectives; and

          (D)  A determination of requirements necessary for the optimum development of Hawaii's energy resources.

          [Such] The planning efforts will identify present conditions and major problems relating to energy resources, their exploration, development, production, and distribution.  It will show the projected nature of the situation and rate of change, present conditions for the foreseeable future based on a projection of current trends in the development of energy resources in Hawaii, and include initiatives designed to fundamentally change how Hawaii consumes energy by accelerating the production of renewable and alternative energy, increasing energy efficiency, developing and adopting new technologies, and ensuring the State's energy security;

     (3)  The State requires an in-depth understanding of the causes and effects of any transitional issues and trends related to changes in the State's energy resources, systems, and markets;

     (4)  There are many agencies of the federal, state, and county governments in Hawaii, as well as many private agencies and a broad set of [non-governmental] nongovernmental entities, engaged in, or expressing an interest in, various aspects of the exploration, research, distribution, transportation, storage, conservation, and production of all forms of energy resources in Hawaii.  Some of these agencies include the University of Hawaii; the department of land and natural resources; the department of business, economic development, and tourism; the division of consumer advocacy; the public utilities commission; the state emergency management agency; the federal energy office; and various county agencies, as well as Hawaii's energy and energy-related companies; and

     (5)  There is an ongoing need in this State to coordinate the efforts of statewide industry and government energy interests; maintain the technical capability and adequate capacity to quantitatively and qualitatively evaluate, analyze, develop, and coordinate implementation of private and public sector energy planning efforts; recommend market-based policies to develop Hawaii's energy resources, systems, and markets; establish and coordinate programs to preserve and protect the State's energy security, maintain a robust energy emergency preparedness program, and effectuate the conservation of energy resources to provide for the equitable distribution thereof; and to formulate plans for the development and use of alternative energy sources.  There is a need for coordination, capability, and capacity, so that there will be maximum conservation and use of energy resources in the State."

     SECTION 4.  Section 196-10, Hawaii Revised Statutes, is amended to read as follows:

     "[[]§196-10[]]  Hawaii renewable hydrogen program.  There is established, within the [department of business, economic development, and tourism,] office of clean energy, a Hawaii renewable hydrogen program to manage the State's transition to a renewable hydrogen economy.  The program shall design, implement, and administer activities that include:

     (1)  Strategic partnerships for the research, development, testing, and deployment of renewable hydrogen technologies;

     (2)  Engineering and economic evaluations of Hawaii's potential for renewable hydrogen use and near-term project opportunities for the State's renewable energy resources;

     (3)  Electric grid reliability and security projects that will enable the integration of a substantial increase of electricity from renewable energy resources on the island of Hawaii;

     (4)  Hydrogen demonstration projects, including infrastructure for the production, storage, and refueling of hydrogen vehicles;

     (5)  A statewide hydrogen economy public education and outreach plan focusing on the island of Hawaii, to be developed in coordination with Hawaii's public education institutions;

     (6)  Promotion of Hawaii's renewable hydrogen resources to potential partners and investors;

     (7)  A plan, for implementation during the years 2007 to 2010, to more fully deploy hydrogen technologies and infrastructure capable of supporting the island of Hawaii's energy needs, including:

          (A)  Expanded installation of hydrogen production facilities;

          (B)  Development of integrated energy systems, including hydrogen vehicles;

          (C)  Construction of additional hydrogen refueling stations; and

          (D)  Promotion of building design and construction that fully incorporates clean energy assets, including reliance on hydrogen-fueled energy generation;

     (8)  A plan, for implementation during the years 2010 to 2020, to transition the island of Hawaii to a hydrogen-fueled economy and to extend the application of the plan throughout the State; and

     (9)  Evaluation of policy recommendations to:

          (A)  Encourage the adoption of hydrogen-fueled vehicles;

          (B)  Continually fund the hydrogen investment capital special fund; and

          (C)  Support investment in hydrogen infrastructure, including production, storage, and dispensing facilities."

     SECTION 5.  Section 196-30, Hawaii Revised Statutes, is amended by amending subsection (b) to read as follows:

     "(b)  Public buildings shall be retro-commissioned no less often than every five years.  The energy resources coordinator shall establish retro-commissioning guidelines by January 1, 2010.  The director of the office of clean energy shall update the retro-commissioning guidelines as necessary."

     SECTION 6.  Section 304A-1891, Hawaii Revised Statutes, is amended by amending subsection (b) to read as follows:

     "(b)  The director of the institute shall coordinate the institute's work with the [energy resources coordinator] director of the office of clean energy in carrying out duties pursuant to section [196-4] 196-B in the area of research and development of renewable energy sources."

     SECTION 7.  Section 196-2, Hawaii Revised Statutes, is amended by repealing the definition of "coordinator".

     [""Coordinator" means the energy resources coordinator."]

     SECTION 8.  Section 196-3, Hawaii Revised Statutes, is repealed.

     ["§196-3  Energy resources coordinator.  The director of business, economic development, and tourism shall serve as energy resources coordinator."]

     SECTION 9.  Section 196-4, Hawaii Revised Statutes, is repealed.

     ["§196-4  Powers and duties.  Subject to the approval of the governor, the coordinator shall:

     (1)  Formulate plans, including objectives, criteria to measure accomplishment of objectives, programs through which the objectives are to be attained, and financial requirements for the optimum development of Hawaii's energy resources;

     (2)  Conduct systematic analysis of existing and proposed energy resource programs, evaluate the analysis conducted by government agencies and other organizations and recommend programs that represent the most effective allocation of resources for the development of energy resources;

     (3)  Formulate and recommend specific proposals, as necessary, for conserving energy resources, including the allocation and distribution thereof;

     (4)  Assist public and private agencies in implementing energy conservation and efficiency programs, the development of indigenous energy resources, and related measures;

     (5)  Coordinate the State's energy programs with those of the federal government, other state governments, governments of nations with interest in common energy resources, and the political subdivisions of the State;

     (6)  Develop programs to encourage private and public exploration, research, and development of indigenous energy resources that will benefit the State;

     (7)  Conduct public education programs to inform the public of the energy resources situation, as it may exist, from time to time and of the government actions taken;

     (8)  Serve as consultant to the governor, public agencies, and private industry on energy-related matters;

     (9)  Contract for services when required for the implementation of this chapter;

    (10)  Review proposed state actions that the coordinator finds to have significant effect on the State's energy objectives and report to the governor their effect on the energy program, and perform other services as may be required by the governor and the legislature;

    (11)  Prepare and submit an annual report and other reports as may be requested to the governor and to the legislature on the implementation of this chapter and all matters related to energy resources;

    (12)  Formulate a systematic process, including the development of requirements, to identify geographic areas that are rich with renewable energy resource potential that can be developed in a cost-effective and environmentally benign manner and designate these areas as renewable energy zones;

    (13)  Develop and recommend incentives, plans, and programs to encourage the development of renewable energy resource projects within the renewable energy zones;

    (14)  Assist public and private agencies in identifying utility transmission projects or infrastructure required to accommodate and facilitate the development of renewable energy resources;

    (15)  Assist public and private agencies, in coordination with the department of budget and finance, in accessing the use of special purpose revenue bonds to finance the engineering, design, and construction of transmission projects and infrastructure that are deemed critical to the development of renewable energy resources;

    (16)  Develop the criteria or requirements for identifying and qualifying specific transmission projects and infrastructure that are critical to the development of renewable energy resources, including providing assistance in accessing the use of special purpose revenue bonds to finance the projects or infrastructure;

    (17)  Develop and maintain a comprehensive and systematic quantitative and qualitative capacity to analyze the status of energy resources, systems, and markets, both in-state and those to which Hawaii is directly tied, particularly in relation to the State's economy, and to recommend, develop proposals for, and assess the effectiveness of policy and regulatory decisions, and conduct energy emergency planning; and

    (18)  Adopt rules for the administration of this chapter pursuant to chapter 91."]

     SECTION 10.  Sections 76-16, 107-22, and 304A-1959, Hawaii Revised Statutes, are amended by substituting the term "office of clean energy" wherever the term "state energy office" or "Hawaii state energy office" appears, as the context requires.

     SECTION 11.  Sections 125C-22, 125C-23, 125C-31, 141-9, 196-5, 196-6.5, 196-11, 196-30(a), 196-63, 206M-23, 286-172, 304A-1892, and 304A-1894.1, Hawaii Revised Statutes, are amended by substituting the term "director of the office of clean energy" wherever the term "state energy resources coordinator", "energy resources coordinator", "coordinator", or "energy program administrator of the department" appears, as the context requires.

     SECTION 12.  All rights, powers, functions, and duties of the state energy office are transferred to the office of clean energy.

     All employees who occupy civil service positions and whose functions are transferred to the office of clean energy by this Act shall retain their civil service status, whether permanent or temporary.  Employees shall be transferred without loss of salary, seniority (except as prescribed by applicable collective bargaining agreements), retention points, prior service credit, any vacation and sick leave credits previously earned, and other rights, benefits, and privileges, in accordance with state personnel laws and this Act; provided that the employees possess the minimum qualifications and public employment requirements for the class or position to which transferred or appointed, as applicable; provided further that subsequent changes in status may be made pursuant to applicable civil service and compensation laws.

     Any employee who, prior to this Act, is exempt from civil service and is transferred as a consequence of this Act may retain the employee's exempt status, but shall not be appointed to a civil service position as a consequence of this Act.  An exempt employee who is transferred by this Act shall not suffer any loss of prior service credit, vacation or sick leave credits previously earned, or other employee benefits or privileges as a consequence of this Act; provided that the employee possesses legal and public employment requirements for the position to which transferred or appointed, as applicable; provided further that subsequent changes in status may be made pursuant to applicable employment and compensation laws.  The director of business, economic development, and technology may prescribe the duties and qualifications of these employees and fix their salaries without regard to chapter 76, Hawaii Revised Statutes.

     SECTION 13.  All appropriations, records, equipment, machines, files, supplies, contracts, books, papers, documents, maps, and other personal property heretofore made, used, acquired, or held by the state energy office relating to the functions transferred to the office of clean energy shall be transferred with the functions to which they relate.

     SECTION 14.  There is appropriated out of the general revenues of the State of Hawaii the sum of $         or so much thereof as may be necessary for fiscal year 2018-2019 for:

     (1)  Reorganizing the state energy office into the office of clean energy; and

     (2)  Commencing the duties of the office of clean energy.

     The sum appropriated shall be expended by the department of business, economic development, and tourism for the purposes of this Act.

     SECTION 15.  Statutory material to be repealed is bracketed and stricken.  New statutory material is underscored.

     SECTION 16.  This Act shall take effect upon its approval; provided that section 14 shall take effect on July 1, 2018.

 

Report Title:

Office of Clean Energy; DBEDT; State Energy Resources Coordinator; State Energy Office; Appropriation

 

Description:

Establishes the Office of Clean Energy to assume the duties of the energy resources coordinator, presently the director of the Department of Business, Economic Development, and Tourism.  Transfers the functions of the State Energy Office to the Office of Clean Energy.  Appropriates moneys.  (HB2724 HD1)

 

 

 

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