STAND. COM. REP. NO. 976

Honolulu, Hawaii

, 2005

RE: S.B. No. 1114

S.D. 1

 

 

Honorable Robert Bunda

President of the Senate

Twenty-Third State Legislature

Regular Session of 2005

State of Hawaii

Sir:

Your Committee on Ways and Means, to which was referred S.B. No. 1114 entitled:

"A BILL FOR AN ACT RELATING TO AN ENERGY STORAGE SYSTEM TAX CREDIT,"

begs leave to report as follows:

The purpose of this measure is to provide a tax credit for the cost of energy storage systems installed for the storage of electricity, or another useful energy product created by electricity, to shift the electricity load to off-peak periods.

The tax credit is not to exceed thirty-five per cent of the total cost of the energy storage system or $500,000, whichever is less, and applies to energy storage systems installed and placed in service after December 31, 2004. The tax credit is repealed on June 30, 2012.

Your Committee finds that an ice thermal storage system, a type of energy storage system, is an air conditioning system that shifts large electric loads from daytime to nighttime or off-peak hours. By using the "battery" effect of ice thermal storage, ice is made and stored at night when electricity generation costs are low and system efficiencies are high. The melting ice is then used for cooling purposes during the day, allowing local electric companies to use more efficient oil-fired generators at night to lower electricity costs.

Your Committee further finds that the energy savings that result from the use of this tax credit will further the State's energy policy, reduce energy expenses for participating taxpayers, and allow local electric companies to consume less fossil fuels to protect the environment.

Your Committee has amended the measure by changing the effective date for the purpose of furthering discussion and by making technical nonsubstantive amendments for the purposes of clarity and style.

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. 1114, as amended herein, and recommends that it pass Third Reading in the form attached hereto as S.B. No. 1114, S.D. 1.

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

____________________________

BRIAN T. TANIGUCHI, Chair