Honolulu, Hawaii


RE: S.B. No. 1050

S.D. 2




Honorable Donna Mercado Kim

President of the Senate

Twenty-Eighth State Legislature

Regular Session of 2015

State of Hawaii




Your Committee on Ways and Means, to which was referred S.B. No. 1050, S.D. 1, entitled:




begs leave to report as follows:


The purpose and intent of this measure is to require the Public Utilities Commission to establish a community-based renewable energy tariff or tariffs.


Your Committee received written comments in support of this measure from the Division of Consumer Advocacy of the Department of Commerce and Consumer Affairs; Kauai Island Utility Cooperative; Blue Planet Foundation; Clean Energy Collective; the Democratic Party of Hawaii; Hawaii Green Growth; Ulupono Initiative; and nine individuals. Your Committee received comments on this measure from the Department of Business, Economic Development, and Tourism; the Public Utilities Commission; and Hawaiian Electric Company Inc.


Your Committee finds that a properly designed community-based renewable energy program has the potential to provide significant energy cost-savings to schools and community organizations and to the under-served market of renters and high-rise apartment owners, who have not been able to benefit from distributed renewable energy systems such as solar photovoltaic systems.


Nevertheless, your Committee takes note of the concern raised by the Department of Business, Economic Development, and Tourism that should be considered as this measure crosses over to the House of Representatives. Specifically, the department expressed concern over the characterization of a customer's participation with third parties as an "investment". Apparently, there are any number of contractual arrangements into which third parties may enter with customers. However, characterizing those arrangements in statute as investments could unintentionally create a risk that the program would have to be registered as a security and comply with the securities laws.


Your Committee has amended this measure by changing the effective date to July 1, 2053, in order to facilitate further discussion on the measure.


As affirmed by the record of votes of the members of your Committee on Ways and Means that is attached to this report, your Committee is in accord with the intent and purpose of S.B. No. 1050, S.D. 1, as amended herein, and recommends that it pass Third Reading in the form attached hereto as S.B. No. 1050, S.D. 2.


Respectfully submitted on behalf of the members of the Committee on Ways and Means,