THE SENATE

S.B. NO.

2858

TWENTY-FIFTH LEGISLATURE, 2010

 

STATE OF HAWAII

 

 

 

 

 

 

A BILL FOR AN ACT

 

 

RELATing TO retail wheeling.

 

 

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

 


     SECTION 1.  The legislature finds that while some states in the 1990s opted to fully or partially unbundle their electricity sectors to allow for competitive generation segments, separate transmission and distribution segments, and independent system operators, Hawaii has yet to unbundle its electricity sector, with each island's utility still operating as a vertically-integrated regulated monopoly.

     The legislature further finds that in general, retail wheeling refers to the distribution of electricity owned by an independent power supplier and sold to a retail consumer over transmission and distribution lines of a public utility that is not itself producing the electricity.  While fifteen other states have actively restructured their energy markets and adopted retail wheeling in some form, in Hawaii, independent power producers must sell power to a public utility rather than allowing for direct sale to end users.

     The legislature further finds that in an environment and electricity market such as Hawaii's, wheeling can provide a vehicle for increased competition in energy markets and improved service and customer choice without requiring the utility to divest its own generation assets or lose control over the operation of transmission and distribution.

     The legislature further finds that retail wheeling can be an effective means of fostering innovation and greater renewable energy production, as renewable independent power producers can take advantage of end user preferences for cleaner power to secure higher prices for their output than may be possible under a given utility's avoided-cost formula.

     The legislature further finds that allowing retail wheeling would provide an alternative option for independent power producers that are not presently covered under the feed-in-tariff schedule being established by the public utilities commission and the consumer advocate.

     The legislature further finds that expanding independent power producers' off-take options will help to attract additional renewable energy investment, contributing to local economic development, job creation, and greater energy security for the State of Hawaii.

     The purpose of this Act is to allow retail wheeling in Hawaii to increase competition within Hawaii's electrical markets, expand customer choice, provide incentives for the production of renewable energy, and diversify Hawaii's energy base.

     SECTION 2.  Chapter 269, Hawaii Revised Statutes, is amended by adding a new section to be appropriately designated and to read as follows:

     "§269‑    Retail wheeling; rules and procedures.  No later than July 1, 2011, the public utilities commission shall establish necessary policies, and rules pursuant to chapter 91, for the deployment of retail wheeling to enable independent power producers to sell electricity directly to end users.

     For purposes of this section, "retail wheeling" means the distribution, over a public utility's transmission and distribution system, of power that is generated by an independent power producer and sold by the independent power producer directly to the end user."

     SECTION 3.  New statutory material is underscored.


     SECTION 4.  This Act shall take effect on July 1, 2010.

 

INTRODUCED BY:

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Report Title:

Retail Wheeling; Public Utilities

 

Description:

Requires the Public Utilities Commission to establish policies and procedures related to retail wheeling to enable independent power producers to sell electricity directly to end users.

 

 

 

The summary description of legislation appearing on this page is for informational purposes only and is not legislation or evidence of legislative intent.