Report Title:

Renewable Energy


Requires electric utility companies to establish additional renewable portfolio standard goals; requests the public utility commission to study the feasibility of implementing a rate structure to encourage the use of renewable energy and an incentives program to reward electric utility companies meeting renewable portfolio standard goals.


S.B. NO.









relating to renewable energy.



SECTION 1. Building a sustainable future in Hawaii requires the government to take a leadership role in developing programs and initiatives designed to encourage people to live within their means. The legislature finds that a significant impediment to the goal of sustainability is the large imbalance between the amount of goods and services exported from Hawaii in comparison to the amount of goods and services imported to Hawaii. Specifically, the legislature notes that Hawaii exports only $2,000,000,000 a year in goods and services while importing $15,000,000,000 a year in goods and services.

Enterprise Honolulu stated that "a key characteristic of a healthy economy is that it exports more than it imports. If payments for imports exceed payments for exports, we have a 'trade deficit.' Just like a negative balance in your checking account impacts your household, if a trade deficit continues too long, the region's quality of life begins a downward slide."

The legislature also finds that Hawaii imports between $2,000,000,000 and $3,000,000,000 worth of oil annually. These figures represent a growing dependence on oil imports which allows electric utility companies to enjoy a financial windfall when they sell electricity to Hawaii consumers. The profits realized by electric utility companies leads to the continued importation and dependence on oil.

The legislature finds that economic diversification, import substitution, and export expansion are key to achieving sustainability. Further, import substitution may be achieved by increasing the use of renewable energy resources found in Hawaii such as wind, solar, ocean thermal, wave, and biomass resources. The purpose of this Act is to encourage import substitution by increasing the use of renewable energy sources found in Hawaii, thereby decreasing the need to import large amount of oil annually.

SECTION 2. Section 269-92, Hawaii Revised Statutes, is amended to read as follows:

"[[]269-92[]] Renewable portfolio standards. Each electric utility company that sells electricity for consumption in the State shall establish a renewables portfolio standard goal of:

(1) Seven per cent of its net electricity sales by December 31, 2003;

(2) Eight per cent of its net electricity sales by December 31, 2005; [and]

(3) Nine per cent of its net electricity sales by December 31, 2010[.];

(4) Fifteen per cent of its net electricity sales by December 31, 2015; and

(5) Twenty per cent of its net electricity sales by December 31, 2020."

SECTION 3. Rate structure implementation; renewable portfolio standard incentives; report. (a) The public utilities commission shall:

(1) Make findings and recommendations concerning the feasibility of the public utilities commission proposing and implementing a utility rate structure designed to reward and encourage consumers to use renewable energy sources found in Hawaii;

(2) Gather, review, and analyze empirical data to determine the extent that this proposed utility rate structure would impact electric utility companies' profit margins, and to ensure that these profit margins do not decrease for a period of five years following the implementation of this rate structure;

(3) Make findings and recommendations concerning the types of incentives that the public utilities commission could offer to electric utility companies in meeting the renewable portfolio standards established in section 269-92, Hawaii Revised Statutes; and

(4) Report findings and recommendations, including proposed legislation, to the legislature no later than twenty days before the convening of the regular session of 2005.

SECTION 4. Statutory material to be repealed is bracketed and stricken. New statutory material is underscored.

SECTION 5. This Act shall take effect upon its approval.