Honolulu, Hawaii



RE:    S.B. No. 349

       S.D. 1




Honorable Donna Mercado Kim

President of the Senate

Twenty-Eighth State Legislature

Regular Session of 2015

State of Hawaii




     Your Committee on Energy and Environment, to which was referred S.B. No. 349 entitled:




begs leave to report as follows:


     The purpose and intent of this measure is to:


     (1)  Establish a renewable fuels production tax credit allowing qualifying taxpayers to claim a refundable income tax credit equal to 20 cents per seventy-six thousand British thermal units of renewable fuel;


     (2)  Repeal the ethanol facility tax credit; and


     (3)  Require the Department of Business, Economic Development, and Tourism to certify all tax credits and submit a report regarding the production and sale of renewable fuels to the Governor and Legislature each year.


     Your Committee received testimony in support of this measure from the Renewable Energy Action Coalition of Hawaii, Blue Planet Foundation, Hawaii Renewable Energy Alliance, Pacific Biodiesel Technologies, and one individual.  Your Committee received comments on this measure from the Department of Business, Economic Development, and Tourism; Department of Taxation; and Tax Foundation of Hawaii.


     Your Committee finds that the State is vulnerable to soaring energy prices and disruptions of its energy imports, which can hinder, cripple, or even devastate the State's economy and the well-being of its residents.  As the most isolated land mass on Earth, the State imports nearly ninety percent of its energy needs and almost one hundred per cent of its transportation needs.  It is critical that the State becomes more self-sufficient to ensure greater energy security.  The establishment of a renewable fuels production tax credit will advance the State's clean energy initiatives and assist the State in achieving greater energy security.


     Your Committee has amended this measure by making technical, nonsubstantive amendments for the purposes of clarity and consistency.


     As affirmed by the record of votes of the members of your Committee on Energy and Environment that is attached to this report, your Committee is in accord with the intent and purpose of S.B. No. 349, as amended herein, and recommends that it pass Second Reading in the form attached hereto as S.B. No. 349, S.D. 1, and be referred to the Committee on Ways and Means.


Respectfully submitted on behalf of the members of the Committee on Energy and Environment,