HOUSE OF REPRESENTATIVES |
H.B. NO. |
561 |
THIRTY-FIRST LEGISLATURE, 2021 |
H.D. 2 |
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STATE OF HAWAII |
S.D. 2 |
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A BILL FOR AN ACT
RELATING TO ENERGY.
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF HAWAII:
(1) Requires the public utilities commission to make determinations of the reasonableness of the costs pertaining to fossil fuel or biomass sourced electricity or gas utility system capital improvements and operations, and to consider the effect of the State's reliance on fossil fuels and biomass based on certain factors;
(2) Requires the public utilities commission to determine on an individual basis whether the analysis is necessary for proceedings involving water, wastewater, or telecommunications providers; and
(3) Exempts the public utilities commission from conducting the analysis for a utility's routine system replacements or determinations that do not pertain to capital improvements or operations.
SECTION 2. Section 269-6, Hawaii Revised Statutes, is amended to read as follows:
"§269-6 General powers and duties. (a) The public utilities commission shall have the general supervision hereinafter set forth over all public utilities, and shall perform the duties and exercise the powers imposed or conferred upon it by this chapter. Included among the general powers of the commission is the authority to adopt rules pursuant to chapter 91 necessary for the purposes of this chapter.
(b) The public utilities commission shall
consider the need to reduce the State's reliance on fossil fuels through energy
efficiency and increased renewable energy generation in exercising its
authority and duties under this chapter.
In making determinations of the reasonableness of the costs [of] pertaining
to fossil fuel or biomass sourced electricity or gas utility system capital
improvements and operations, the commission shall explicitly consider,
quantitatively or qualitatively, the effect of the State's reliance on fossil
fuels and biomass on:
(1) [price]
Price volatility[,];
(2) [export]
Export of funds for fuel imports[,];
(3) [fuel]
Fuel supply reliability risk[,]; and
(4) [greenhouse]
Greenhouse gas emissions.
The
commission may determine that short-term costs or direct costs of renewable energy
generation that are higher than alternatives relying more heavily on fossil
fuels and biomass are reasonable, considering the impacts resulting from
the use of fossil fuels[.] and biomass. The commission shall determine whether the analysis
is necessary for proceedings involving water, wastewater, or telecommunications
providers on an individual basis.
(c)
The analysis described in subsection (b)
shall not be required for a utility's routine system replacements, such as overhauls
and overhead or overground line determinations, or determinations that do not pertain
to capital improvements or operations, including but not limited to financing requests.
[(c)]
(d) In exercising its authority and
duties under this chapter, the public utilities commission shall consider the
costs and benefits of a diverse fossil fuel portfolio and of maximizing the
efficiency of all electric utility assets to lower and stabilize the cost of
electricity. Nothing in this section
shall subvert the obligation of electric utilities to meet the renewable
portfolio standards set forth in section 269‑92.
[(d)]
(e) The public utilities
commission, in carrying out its responsibilities under this chapter, shall consider
whether the implementation of one or more of the following economic incentives
or cost recovery mechanisms would be in the public interest:
(1) The establishment of a shared cost savings incentive mechanism designed to induce a public utility to reduce energy costs and operating costs and accelerate the implementation of energy cost reduction practices;
(2) The establishment of a renewable energy curtailment mitigation incentive mechanism to encourage public utilities to implement curtailment mitigation practices when lower cost renewable energy is available but not utilized through the sharing of energy cost savings between the public utility, ratepayer, and affected renewable energy projects;
(3) The establishment of a stranded cost recovery mechanism to encourage the accelerated retirement of an electric utility fossil fuel electric generation plant by allowing an electric utility to recover the stranded costs created by early retirement of a fossil generation plant; and
(4) The establishment of differentiated authorized rates of return on common equity to encourage increased utility investments in transmission and distribution infrastructure, discourage an electric utility investment in fossil fuel electric generation plants to incentivize grid modernization, and disincentivize fossil generation, respectively.
[(e)]
(f) The chairperson of the
commission may appoint a hearings officer, who shall not be subject to chapter
76, to hear and recommend decisions in any proceeding before it other than a
proceeding involving the rates or any other matters covered in the tariffs
filed by the public utilities. The
hearings officer shall have the power to take testimony, make findings of fact
and conclusions of law, and recommend a decision; provided that the findings of
fact, the conclusions of law, and the recommended decision shall be reviewed
and may be approved by the commission after notice to the parties and an
opportunity to be heard. The hearings
officer shall have all of the above powers conferred upon the public utilities
commission under section 269-10."
SECTION 3. Section 269-16.1, Hawaii Revised Statutes, is amended by amending subsection (b) to read as follows:
"(b) In developing performance incentive and penalty mechanisms, the public utilities commission's review of electric utility performance shall consider, but not be limited to, the following:
(1) The economic
incentives and cost-recovery mechanisms described in section [269-6(d);]
269-6(e);
(2) Volatility
and affordability of electric rates and customer electric bills;
(3) Electric
service reliability;
(4) Customer
engagement and satisfaction, including customer options for managing electricity
costs;
(5) Access
to utility system information, including but not limited to public access to electric
system planning data and aggregated customer energy use data and individual
access to granular information about an individual customer's own energy use
data;
(6) Rapid
integration of renewable energy sources, including quality interconnection of
customer-sited resources; and
(7) Timely
execution of competitive procurement, third‑party interconnection, and
other business processes."
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.
Report Title:
Public Utilities Commission; Utilities; Reasonableness of Costs
Description:
Requires the public utilities commission to make determinations of the reasonableness of the costs pertaining to fossil fuel or biomass sourced electricity or gas utility system capital improvements and operations and to consider the effect of the State's reliance on fossil fuels and biomass based on certain factors. Requires the public utilities commission to determine on an individual basis whether the analysis is necessary for proceedings involving water, wastewater, or telecommunications providers. Clarifies that the analysis is not required for a utility's routine system replacements or determinations that do not pertain to capital improvements or operations. (SD2)
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not legislation or evidence of legislative intent.