Report Title:

Energy; geothermal royalties

Description:

Allocates funds from the State's portion of the geothermal royalties for each of the fiscal years 2003-2004 and 2004-2005 to be used as the State's cost share for the Hawaii Hydrogen Power Park Project through phases 2 and 3. (SB506 HD2)

THE SENATE

S.B. NO.

506

TWENTY-SECOND LEGISLATURE, 2003

H.D. 2

STATE OF HAWAII

 


 

A BILL FOR AN ACT

 

RELATING TO geothermal royalties.

 

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

SECTION 1. Scientists have recognized hydrogen as a potential source of fuel for many years. Currently, hydrogen is used in industrial processes, rocket fuel, and spacecraft propulsion. With further research and development, hydrogen could competitively serve as an alternative source of energy for fueling vehicles and generating electricity.

Recognizing the potential of hydrogen fuel, the United States Department of Energy and the private sector have funded hydrogen research and development programs for several years. The federal government alone allocates an average of $18,000,000 annually for hydrogen research and development. Currently, the market capitalization of fuel cell companies that rely on hydrogen as the fuel source for the cell is in excess of $10,000,000,000.

The legislature finds that Hawaii represents an excellent site to attract government and industry investment in hydrogen. Hawaii's major advantages include:

(1) The availability of indigenous renewable resources, including geothermal energy;

(2) The excellent research capabilities at the University of Hawaii;

(3) Hawaii's central location for trade opportunities with Pacific Rim nations; and

(4) Hawaii's high transportation fuel costs.

There has been significant progress in hydrogen research and development in Hawaii. For example, in 1999, University of Hawaii chemists discovered a new way to store hydrogen energy that may result in more economical, pollution-free vehicles. Tackling one of hydrogen's major challenges, the team found a catalyst that will release hydrogen from lightweight materials at a moderate temperature. This has major implications for developing effective fuel cells for vehicles. As a result of these accomplishments, the Hydrogen Technical Advisory Panel and the United States Department of Energy designated the Hawaii team leader the "1999 Research Success Story."

In addition, the 2000 legislature requested a study to recommend options that could result in hydrogen becoming a future ingredient in the State's energy economy. The Hawaii natural energy institute (HNEI) of the University of Hawaii concluded that large-scale hydrogen use for transportation can be competitive this decade. The study also determined that fleet and military transportation on Oahu has the largest potential for hydrogen and fuel cell use.

On the national level, many advancements are taking place to develop technologies that will utilize hydrogen as a fuel source. Major companies are investing in the development of fuel cells for both stationary and mobile power. Automakers are projecting the commercial availability of fuel cell-powered vehicles that could be fueled by hydrogen within this decade. Significant amounts of investments are being made to develop fuel cells and other distributed generation technologies.

With its traditional high fuel costs and a wealth of renewable energy resources, Hawaii could attract these advanced technology development companies for research and development, testing, and deployment. The University of Hawaii is recognized as a "center for excellence in hydrogen research" by the United States Department of Energy. These factors can lead to the development of a hydrogen-based economy where Hawaii produces more of its own environmentally clean fuels, thus reducing its dependence on fossil fuels, and resulting in job growth, reduced pollution, and a more robust state economy.

The legislature finds that the State's geothermal royalties have a logical nexus with the promotion of hydrogen as an energy source and the State's efforts to increase and enhance hydrogen use in Hawaii.

Accordingly, the purpose of this Act is to appropriate funds for fiscal years 2003-2004 and 2004-2005 from the State's portion of the geothermal royalties to the department of business, economic development, and tourism, to be used as the State's cost share for the Hawaii hydrogen power park project through phases 2 and 3.

SECTION 2. There is appropriated out of the special land and development fund the sum of $1 or so much thereof as may be necessary for fiscal year 2003-2004 and the same sum or so much thereof as may be necessary for fiscal year 2004-2005 for the State's cost share for the Hawaii hydrogen power park project through phases 2 and 3.

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

SECTION 3. This Act shall take effect on July 1, 2003.