HOUSE OF REPRESENTATIVES

H.B. NO.

2691

TWENTY-SIXTH LEGISLATURE, 2012

 

STATE OF HAWAII

 

 

 

 

 

 

A BILL FOR AN ACT

 

 

Relating to geothermal development.

 

 

BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF HAWAII:

 


     SECTION 1.  Chapter 182, Hawaii Revised Statutes, is amended by adding two new sections to be appropriately designated and to read as follows:

     "§182-A  Geothermal development on state land.  (a)  The board shall reserve state land that is designated as a geothermal resource subzone for geothermal development activities, as defined in section 205-5.1.

     (b)  The board shall process any application to lease state land for geothermal development activities as both a land lease and a mining lease.

     (c)  The board shall require that any person applying to lease state land that is designated as a geothermal resource subzone for the purpose of producing electricity for sale to a public utility to have been selected and approved by the public utility as part of an open and public bidding process.  The person shall not be subject to any additional bidding process as a requirement to lease the land.

     (d)  If an environmental assessment or environmental impact statement is required for geothermal development on state land pursuant to chapter 343, the land lease and the mining lease may be consolidated into a single environmental assessment or environmental impact statement.

     §182-B  Geothermal development special fund.  (a)  There is established the geothermal development special fund to be administered by the department of land and natural resources and into which shall be deposited:

     (1)  Legislative appropriations to the special fund;

     (2)  Royalty payments received by the State pursuant to section 182-18 for the utilization of geothermal resources;

     (3)  All interest earned or accrued on moneys deposited in the special fund; and

     (4)  Any other moneys made available to the fund.

     (b)  Moneys in the special fund shall be expended for geothermal development activities, as defined in section 205-5.1."

     SECTION 2.  Section 182-18, Hawaii Revised Statutes, is amended to read as follows:

     "[[]§182-18[]]  Geothermal royalties.  (a)  The board shall fix the payment of royalties to the State for the utilization of geothermal resources at a rate [which] that will encourage the initial and continued production of [such] the resources.  With respect to all geothermal mining leases previously issued or to be issued, where the board determines that it is necessary to encourage the initial or continued production of geothermal resources, the board shall have the authority to waive royalty payments to the State for any fixed period of time up to but not exceeding eight years.

     (b)  The board shall adopt, amend, or repeal rules pursuant to chapter 91 to establish the basis upon which the amount and duration of royalty payments to the State will be fixed or waived.  The board's assessment of each application shall include, but not be limited to, the examination of such factors as the progress of geothermal development taking place in the State at the time of the application, the technical and financial capabilities of the applicant to undertake the project, and the need for providing a financial incentive in order for the applicant to proceed.  The granting of any favorable terms to an applicant for the payment of royalties under this section may be revoked by the board if the applicant fails to satisfy any of the terms and conditions established by the board, or if the applicant wholly ceases operations and for reasons other than events which are outside the control of the parties and which could not be avoided by the exercise of due care by the parties.

     (c)  Royalty payments received by the State for the utilization of geothermal resources shall be deposited into the geothermal development special fund established pursuant to section 182-B.

     [(c)] (d)  The board shall submit a written report of all geothermal royalty dispositions, including funds expended from the geothermal development special fund established pursuant to section 182-B, to the legislature in accordance with section 171-29."

     SECTION 3.  In codifying the new sections added by section 1 of this Act, the revisor of statutes shall substitute appropriate section numbers for the letters used in designating the new sections in this Act.

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

     SECTION 5.  This Act shall take effect upon its approval.

 

INTRODUCED BY:

_____________________________

 

 


 


 

Report Title:

DLNR; Geothermal Development; Leases; Special Fund

 

Description:

Requires state land that is designated as a geothermal resource subzone to be reserved for geothermal development.  Requires leases of state land that is designated as a geothermal resource subzone to be processed as both a land lease and a mining lease.  Requires an open bidding process for leases of state land designated as a geothermal resource subzone for electricity production.  Establishes the geothermal development special fund.

 

 

 

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