Honolulu, Hawaii

                , 2021


RE:   H.B. No. 561

      H.D. 2





Honorable Scott K. Saiki

Speaker, House of Representatives

Thirty-First State Legislature

Regular Session of 2021

State of Hawaii




     Your Committee on Consumer Protection & Commerce, to which was referred H.B. No. 561, H.D. 1, entitled:




begs leave to report as follows:


     The purpose of this measure is to:


     (1)  Require the Public Utilities Commission to determine whether analysis of the effect of the State's reliance on fossil fuels is necessary for proceedings involving water, wastewater, or telecommunications providers on an individual basis; and


     (2)  Provide that the analysis is not required for an electric or a gas utility's routine system replacements or determinations that do not directly pertain to capital improvements or operations.


     Your Committee received testimony in support of this measure from the Department of Commerce and Consumer Affairs; Public Utilities Commission; and Hawaiian Electric Company, Inc.


     Your Committee finds that the Public Utilities Commission is statutorily required to consider the effect of the State's reliance on fossil fuels on price volatility, export of funds for fuel imports, fuel supply reliability risk, and greenhouse gas emission when the Commission makes determinations on the reasonableness of the costs of utility system capital improvements and operations.  This analysis promotes the State's goal in achieving its carbon negative target by 2045 and helps to mitigate the damaging effects of sea level rise due to greenhouse gas emission.  However, your Committee further finds that this analysis may not be relevant in many circumstances for certain public utilities and this analysis should therefore be done only when appropriate.  This measure will allow the Commission to operate more efficiently, while still fulfilling its statutory duty.


     Your Committee has amended this measure by:


(1)  Clarifying provisions relating to the Public Utilities Commission's analysis in determining the reasonableness of the costs of utility system capital improvements and operations to avoid excluding indirect costs from statutory guidance; and


(2)  Making a technical, nonsubstantive amendment for the purposes of clarity, consistency, and style.


     As affirmed by the record of votes of the members of your Committee on Consumer Protection & Commerce that is attached to this report, your Committee is in accord with the intent and purpose of H.B. No. 561, H.D. 1, as amended herein, and recommends that it be referred to your Committee on Finance in the form attached hereto as H.B. No. 561, H.D. 2.



Respectfully submitted on behalf of the members of the Committee on Consumer Protection & Commerce,