H.B. NO.














relating to zero-emission vehicles.





SECTION 1. The legislature finds that climate change caused by carbon emissions from burning fossil fuels poses a serious threat to the economic well-being, public health, natural resources, and environment of Hawaii. The potential adverse impacts of climate change include more destructive storms, hotter temperatures, a reduction in the quality and supply of freshwater, a rise in sea levels resulting in the displacement of coastal businesses and residences, damage to marine ecosystems and the natural environment, and an increase in incidents of infectious diseases, asthma, and other human health-related problems.

The State has committed to eliminating imported fuels from the electricity and ground transportation sectors, abiding by the Paris Climate Accord's goal to limit the amount of global warming to less than 1.5 degrees Celsius, and achieving net zero carbon emissions for Hawaii by 2045. The legislature finds that meeting the State's clean energy goals and commitments necessitates the rapid transition to zero-emission vehicles that utilize local, renewable energy sources.

Zero-emission vehicles, such as electric vehicles, play an integral role in Hawaii's clean energy future. Electric vehicles are much less expensive to power per mile than their gasoline counterparts. By using stored electrical energy, electric vehicles can take advantage of intermittent solar, wind, and other clean energy resources. With the continued growth of an intelligent electricity grid, electric vehicles become an essential component to electricity load and clean energy resource balancing. They also provide clean mobility solutions for Hawaii residents and visitors.

The legislature further finds that rental motor vehicles represent the largest passenger vehicle fleets in Hawaii and are responsible for a significant amount of carbon emissions. Transitioning rental motor vehicle fleets to zero-emission vehicles would significantly reduce carbon emissions; increase the number of zero-emission vehicles entering the secondary market, making them more affordable to more Hawaii residents; and demonstrate to all who visit the State that Hawaii is a leader in clean energy and sustainable transportation.

The purpose of this Act is to:

(1) Establish a rental motor vehicle emissions surcharge tax on rental motor vehicles with internal combustion engines; and

(2) Set requirements for rental motor vehicle lessors operating in Hawaii to expedite the incorporation of zero-emission vehicles in their fleets.

SECTION 2. Chapter 251, Hawaii Revised Statutes, is amended by adding a new section to be appropriately designated and to read as follows:

"251-    Rental motor vehicle emissions surcharge tax; established. (a) Beginning on January 1, 2022, there is levied and shall be assessed and collected each month a rental motor vehicle emissions surcharge tax of $1 for each day, or portion of a day, that a rental motor vehicle is rented or leased. The surcharge tax shall be levied upon the lessor.

(b) The rental motor vehicle emissions surcharge tax shall not be levied on:

(1) Any motor vehicles qualifying as zero-emission vehicles pursuant to section 437D-   ; and

(2) Rental motor vehicles rented out as car-sharing vehicles pursuant to section 251-2.5.

(c) All moneys received from any surcharge taxes assessed pursuant to this section shall be deposited into the energy security special fund established under section 201-12.8."

SECTION 3. Chapter 437D, Hawaii Revised Statutes, is amended by adding a new section to be appropriately designated and to read as follows:

"437D-    Zero-emission vehicles. (a) All lessors of rental motor vehicles in the State shall incorporate zero-emission light duty passenger vehicles into their rental motor vehicle fleets according to the following schedule:

(1) No less than ten per cent by July 1, 2025;

(2) No less than thirty per cent by July 1, 2028;

(3) No less than fifty per cent by July 1, 2030; and

(4) One hundred per cent by July 1, 2035.

(b) To certify compliance with this section, beginning in 2022, each lessor in the State shall report to the director annually by December 1, detailing the make, model, license plate number, and fuel type of each rental motor vehicle in the lessor's fleet.

(c) The requirements set forth in this section shall apply only to lessors owning and operating more than two hundred light duty passenger vehicles as rental motor vehicles statewide.

(d) For the purposes of this section:

"Battery electric vehicle" means a vehicle with four or more wheels that draws propulsion exclusively from a battery that can be recharged from an external source of energy.

"Hydrogen fuel cell vehicle" means a vehicle with four or more wheels that draws propulsion from electricity generated by passing hydrogen through a fuel cell.

"Light duty passenger vehicle" means a vehicle below eight thousand five hundred pounds gross weight.

"Rental motor vehicle" has the same meaning as defined in section 251-1 notwithstanding section 437D-3.

"Zero-emission vehicle" means a battery electric vehicle or a hydrogen fuel cell vehicle."

SECTION 4. Statutory material to be repealed is bracketed and stricken. New statutory material is underscored.

SECTION 5. This Act shall take effect on July 1, 2021.








Report Title:

Zero-emission Vehicles; Rental Motor Vehicles; Lessors; Fleet; Surcharge; Department of Commerce and Consumer Affairs



Requires certain rental motor vehicle lessors to expedite the incorporation of one hundred per cent zero-emission vehicles into the lessor's fleet by 7/1/2035. Requires motor vehicle lessors to certify their compliance to the director of commerce and consumer affairs. Beginning 1/1/2022, establishes a rental motor vehicle emissions surcharge tax on certain rental motor vehicles with internal combustion engines.




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