Bill Text: HI SB1059 | 2022 | Regular Session | Introduced
Bill Title: Relating To Clean Energy Financing.
Spectrum: Partisan Bill (Democrat 1-0)
Status: (Introduced - Dead) 2021-12-10 - Carried over to 2022 Regular Session. [SB1059 Detail]
Download: Hawaii-2022-SB1059-Introduced.html
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THE SENATE |
S.B. NO. |
1059 |
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THIRTY-FIRST LEGISLATURE, 2021 |
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STATE OF HAWAII |
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A BILL FOR AN ACT
RELATING TO CLEAN ENERGY FINANCING.
BE IT
ENACTED BY THE LEGISLATURE OF THE STATE OF HAWAII:
SECTION 1. Significant investment in clean energy technology and infrastructure will be required to achieve the State's goals of energy self-sufficiency, energy security, and energy diversification. Investment is also needed to meet the renewable portfolio and energy efficiency portfolio standards in chapter 269, Hawaii Revised Statutes. The current aggregate level of green infrastructure investment is $15,350,000.
Green infrastructure investment
supports Hawaii's evolving energy market and provides affordable options for
Hawaii's ratepayers. Due to the significant
amount of capital required for green infrastructure investment, the State must leverage private investment with limited public funds. A growth in the clean energy market will
reduce the cost of clean energy for ratepayers, drive job creation, and save
billions of taxpayer dollars currently being spent on importing petroleum oil.
The legislature has made various efforts to
invest in green technology. Act 155,
Session Laws of Hawaii 2009, established the building energy efficiency
revolving loan fund to provide low cost financing to eligible public, private
and nonprofit borrowers to make energy efficiency improvements to
buildings. Act 211, Session Laws of Hawaii
2013, established the Hawaii green infrastructure authority to make
cost-effective green infrastructure financing options accessible and affordable
to customers under the green energy market securitization loan program.
A significant barrier to clean
energy adoption has been the unavailability of flexible financing and low-cost
capital. Building Hawaii's clean energy
infrastructure at the lowest possible cost is vital to reach the State's goal of one hundred per
cent clean energy by 2045. Public funds
must be used in a sustainable manner to simultaneously spark customer demand
for clean energy technology and attract private investment in green
technology. It is the State's goal that each public
dollar spent will have an investment multiplier effect throughout the green
technology industry.
A variety of financing options must be available to support Hawaii's clean energy investment. Ratepayer-funded programs, such as energy efficiency rebates and the green energy market securitization loan program, have made progress but do not serve all ratepaying customers or the entire clean energy technology market. The green energy market securitization loan program has facilitated over $110,000,000 in solar photovoltaic and energy efficiency projects, but the program is not able to serve all ratepayers and focuses only on established technology. The green energy market securitization bond was an innovative use of a rate reduction bond, but due to the time lag between the issuance of the bond and expenditures for improvements, using this bond financing was inefficient compared to using revolving loan funds, which are expended annually and in a more expedient manner.
The purpose of this Act is to strengthen the Hawaii green infrastructure authority's ability to support investment in clean energy technology and infrastructure by:
(1) Creating a clean energy and energy efficiency revolving loan fund to finance a broad range of clean energy technologies;
(2) Repealing the building energy efficiency revolving loan fund; and
(3) Making an appropriation out of the clean energy and energy efficiency revolving loan fund to make clean energy investment loans or for other approved uses.
"§196- Clean energy and energy efficiency revolving loan fund. (a)
There is established in the Hawaii green infrastructure special fund
created in section 196-65 the clean energy and energy efficiency revolving loan
fund, similar to a revolving line of credit, which shall be administered by the
authority. Funds deposited into the
clean energy and energy efficiency revolving loan fund shall not be under the
jurisdiction of, nor be subject to approval by, the Hawaii public utilities
commission and shall also include:
(1) Any amounts, up to a total amount
not to exceed $50,000,000, of moneys borrowed by the Hawaii green
infrastructure authority, with the approval of the governor, from federal,
county, private, or other funding sources, pursuant to part III of chapter 39;
(2) Funds from federal, state, county,
private, or other funding sources;
(3) Investments from public or private
investors;
(4) Moneys received as repayment of
loans and interest payments; provided that the repayment of loans and interest
payments under this paragraph shall not include repayment of loans and interest
collected as a result of funds advanced from proceeds of the green energy
market securitization bonds; and
(5) Any fees collected by the authority
under this section; provided that moneys collected as a result of the funds
advanced from proceeds of the green energy market securitization bonds be kept
separate from fees collected as a result of funds advanced from proceeds of
this clean energy and energy efficiency loan fund.
(b)
Moneys in the clean energy and energy
efficiency revolving loan fund shall be used to provide low-cost loans at
below-market rates or other authorized financial assistance to eligible public,
private, and nonprofit borrowers for clean energy investments or other authorized
uses or both, on terms approved by the authority. Moneys from the fund may be used to cover
administrative and legal costs of fund management and management associated
with individual loans, to include personnel, services, technical assistance,
data collection and reporting, materials, equipment, and travel for the
purposes of this section.
(c)
Appropriations or authorizations from
the clean energy and energy efficiency revolving loan fund shall be expended by
the authority. The authority may contract
with other public or private entities for the provision of all or a portion of
the services necessary for the administration and implementation of the loan
fund program. The authority may set fees
or charges for fund management and technical site assistance provided under
this section. The authority may adopt
rules pursuant to chapter 91 to carry out the purposes of this section.
(d)
All interest earned on the loans,
deposits, or investments of the moneys in the fund shall become part of the
fund.
(e)
The authority may establish subaccounts
within the fund as necessary."
SECTION 3. Section 196-61, Hawaii Revised Statutes, is amended by adding new definitions to be appropriately inserted and to read as follows:
""Clean
energy investments" means the purchase or installation,
or both, of clean energy technology, including energy efficiency measures,
green transportation infrastructure, recycling and renewable energy technology.
"Green
energy money $aver on-bill program" means the tariff-based
on-bill repayment mechanism approved for the exclusive use of the authority by
the Hawaii public utilities commission.
"Green
infrastructure loan program", "green energy market
securitization loan program", or "GEMS loan program" means the
loan program established under part IV and capitalized by the issuance of the
green energy market securitization bonds.
"Limited
liability company", also known as "LLC", shall have the same
meaning as in section 428-101.
"Loan
fund program" means the clean energy and energy efficiency revolving loan
fund program.
"Qualified
security" shall have the same meaning as in section 227D-1.
"Renewable
energy" shall have the same meaning
as in section 269-91.
"Renewable
energy technology" means the equipment
and related accessories required to generate or produce renewable energy.
"Special
purpose entity", also known as
"SPE", means a legal entity created to fulfill a narrow,
specific, or temporary objectives and typically used by companies to isolate
the firm from financial risk.
"Subaccount"
means a fund that is established within but separate from another fund and is
reserved for a specific purpose."
SECTION 4. Section 196-64, Hawaii Revised Statutes, is amended to read as follows:
"[[]§196-64[]] Functions, powers, and duties of the authority. (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, for the green
energy market securitization loan program, 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.
(b) The authority shall submit to the public utilities commission an annual plan for the green energy market securitization loan program for review and approval no later than ninety days prior to the start of each fiscal year. The annual plan submitted by the authority shall include the authority's projected operational budget for the succeeding fiscal year.
(c) In the performance of, and with respect to the functions, powers, and duties vested in the authority by this part, the authority shall administer the clean energy and energy efficiency revolving loan fund pursuant to section 196-__, and may:
(1) Make loans and
expend funds to finance the purchase or installation of clean energy technology
and services;
(2) Implement and
administer loan programs on behalf of other state departments or agencies
through a memorandum of agreement, and expend funds appropriated to said department
or agency for purposes authorized by the Legislature;
(3) Utilize all
repayment mechanisms, including the green energy money $aver on-bill program, financing
tools, servicing and other arrangements, and sources of capital available to
the authority;
(4) Exercise powers
to organize and establish special purpose entities as limited liability
companies under the laws of the State;
(5) Acquire, hold,
and sell qualified securities;
(6) Pledge unencumbered net assets, loan
receivable, assigned agreements, and security interests over equipment
financed, as collateral for the authority's
borrowings from federal, county, or private lenders or agencies;
(7) Utilize the
employees of the authority, including the executive director;
(8) 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 fund program;
(9) Enter into
contracts for the administration of the loan fund program, without the
necessity of complying with chapter 103D;
(10) Establish loan fund
program guidelines;
(11) 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 legislature; and
(12) Perform all
functions necessary to effectuate the purposes of this part.
(d) The authority shall submit an annual report for
the clean energy and energy efficiency revolving loan fund to the legislature
no later than twenty days prior to the convening of each regular session
describing the projects funded and the projected energy impacts."
SECTION 5. Section 201-12.8, Hawaii Revised Statutes, is amended by amending subsection (b) to read as follows:
"(b) Subject to legislative appropriation, moneys from the fund may be expended by the Hawaii state energy office for the following purposes and used for no other purposes, except for those set forth in this section:
(1) To support the Hawaii clean energy initiative program and projects that promote and advance dependable and affordable energy, renewable energy, energy efficiency, energy self-sufficiency, and greater energy security and resiliency for the State and public facilities;
(2) To fund, to the extent possible, the climate change mitigation and adaptation commission and the greenhouse gas sequestration task force;
(3) To support achieving the zero emissions clean economy target set forth in section 225P-5;
[(4) To fund the
building energy efficiency revolving loan fund established in section 201-20;
(5)] (4) To fund projects and incentives to promote
the adoption of clean transportation technologies, develop clean vehicle
charging infrastructure, and upgrade infrastructure to support the development
of clean vehicle charging infrastructure; and
[(6)] (5) To fund, to the extent possible, the duties
of the state building code council in section 107-24, as they relate to the
development of energy conservation codes."
SECTION 6. Section 201-20, Hawaii Revised Statutes, is repealed.
["[§201-20]
Building
energy efficiency revolving loan fund.
(a) There is established in the
state treasury the building energy efficiency revolving loan fund which shall
be administered by the department, and into which shall be deposited:
(1) Funds from federal, state, county,
private, or other funding sources;
(2) Moneys
received as repayment of loans and interest payments; and
(3) Any fees collected by the department
under this section.
(b)
Moneys in the building energy efficiency
revolving loan fund shall be used to provide low or no interest loans or other
authorized financial assistance to eligible public, private, and nonprofit
borrowers to make energy efficiency improvements in buildings. Moneys from the fund may be used to cover
administrative and legal costs of fund management and management associated with
individual loans, to include personnel, services, technical assistance, data collection
and reporting, materials, equipment, and travel for the purposes of this
section.
(c) Appropriations or authorizations from the
fund shall be expended by the department.
The department may contract with other public or private entities for
the provisions of all or a portion of the services necessary for the
administration and implementation of the loan fund program. The department may set fees or charges for
fund management and technical site assistance provided under this section. The department may adopt rules pursuant to
chapter 91 to carry out the purposes of this section.
(d)
All interest earned on the
deposit or investment of the moneys in the fund shall become part of the fund.
(e)
The department may establish
subaccounts within the fund as necessary."]
SECTION 7. There is appropriated out of the clean energy and energy efficiency revolving loan fund the sum of $50,000,000 or so much thereof as may be necessary for fiscal year 2021-2022 to provide loans or other financial assistance to eligible borrowers for clean energy investments or other authorized uses.
The sum appropriated shall be expended by the Hawaii green infrastructure authority for the purposes of this Act.
SECTION 8. Statutory material to be repealed is
bracketed and stricken. New statutory
material is underscored.
SECTION 9. This Act shall take effect upon its approval.
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INTRODUCED
BY: |
_____________________________ |
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BY REQUEST |
Report Title:
Clean Energy and Energy Efficiency Revolving Loan Fund; Building Energy Efficiency Revolving Loan Fund; Hawaii Green Infrastructure Authority; Appropriation
Description:
Creates the clean energy and energy efficiency revolving loan fund under the administration of the Hawaii Green Infrastructure Authority. Repeals the building energy efficiency revolving loan fund. Appropriates loan ceiling. Effective upon approval.
The summary description
of legislation appearing on this page is for informational purposes only and is
not legislation or evidence of legislative intent.
