Blue Planet has created a new website, cleanenergyhawaii.org, to enable residents to learn about and voice their support for these and other critical clean energy initiatives.
In a recent press release, Blue Planet Foundation announced the new website, intended to allow residents to stay current with important legislation on clean energy initiatives.
“Game changing” clean energy measures moving at legislature
Barrel tax for clean energy and solar and efficiency financing bills pass to Senate
STATE CAPITOL— Hawaii‟s transition to energy independence could get a boost if pending clean energy measures continue to receive support from the state legislature. Key clean energy measures have made the crossover deadline, including bills to develop clean energy investment from a small tax on oil products sold in Hawai„i and remove the upfront cost of solar and efficiency improvements to make clean energy more accessible to residents statewide. Bill descriptions and numbers below.
Blue Planet has created a new website cleanenergyhawaii.org to enable residents to learn about and voice their support for these and other critical clean energy initiatives.
“These are game changing measures that will accelerate Hawaii‟s transition to energy independence,” said Jeff Mikulina, Executive Director of the Blue Planet Foundation, an organization dedicated to ending the use of fossil fuel in Hawai„i and globally. “These bills will make it easier for residents to play a role in our clean energy future.”
These and other clean energy measures, however, will face a difficult time the remainder of the session as they compete for attention with other economic and education matters. Blue Planet Foundation is making the case to lawmakers that the pending clean energy bills have a positive impact on the economy through local job creation and reduced expenditures on oil imports.
“Real economic prosperity for Hawaii means plugging the single biggest leak of money in our economy: purchasing foreign oil,” said Henk Rogers, Founder and Chairman of the Blue Planet Foundation. “We can choose to ship our money overseas to purchase energy or keep it in the islands and pay for local jobs.”
According to the Hawaii Solar Energy Association, photovoltaic systems contribute hundreds of millions of dollars to the state‟s economy. A recent study showed that salaries in the energy sector in Hawai„i are growing at 8.4 percent annually.
Blue Planet Foundation CLEAN ENERGY MEASURES 2010 Page 1 of 5
Blue Planet is frustrated that lawmakers did not move other critical clean energy measures this session, including those that would have dramatically increased the efficiency of new homes in Hawai„i. House Bill 2520 and Senate Bill 2235 would have required that Hawai„i homes built after 2015 be “net zero energy capable,” meaning the homes are about 50% more efficient than homes built today. The organization is also disappointed that a proposed constitutional amendment to elevate the state‟s clean energy goals to the constitution failed to win support.
Nonetheless, Blue Planet believes that the remaining measures have the potential to dramatically change Hawaii‟s clean energy landscape—if lawmakers take decisive action over the next month and a half.
“While passing bold measures such as these takes political courage, the legacy of creating a clean energy future will be remembered for generations,” said Rogers.
PRIORITY CLEAN ENERGY MEASURES 1. Clean Energy Investment Fund (HB 2421)
The critical elements of Hawaii‟s clean energy future—energy efficiency, smart-grid infrastructure, planning and implementation—require up-front investment. Blue Planet believes the best way to provide investment funds is by tapping the source of our problem—imported oil—to fund clean energy programs. House Bill 2421 increases a small tax on each barrel of oil used in Hawai„i that is applied to energy security and other uses.
A barrel fee (or “carbon tax”) is smart tax-shifting policy that discourages fossil fuel use while providing a source of revenue for clean energy planning and implementation. Unlike many other taxes, the barrel tax is largely avoidable by most residents. Energy efficiency, conservation, and switching to clean sources of power all reduce the burden of the tax.
The current House draft of the measure (HB 2421 HD2) tacks one dollar to each barrel of oil used in the state, excluding aviation fuels. The revenue generated is divided between various clean energy planning, research, and implementation programs, as well as food security initiatives.
Blue Planet prefers that bill include a surcharge of $5 per barrel. Such an amount would yield approximately $150 million annually that could be applied to clean energy programs, dramatically accelerating Hawaii‟s transition from imported oil. Blue Planet is also advocating that a large percentage of the revenue raised from the barrel tax be dedicated to vastly increasing energy efficiency programs through the energy efficiency public benefit funds administrator, including increasing and adding efficiency incentives such as appliance buy-back programs, free home energy audits, solar water heater and compact fluorescent / LED rebates, and other efficiency programs.
Blue Planet Foundation CLEAN ENERGY MEASURES 2010 Page 2 of 5
“If we truly want to rapidly transition Hawaii away from imported fossil fuel, we have to be prepared to invest in that preferred future today,” said Mikulina. “This small surcharge will pay a handsome dividend to residents in energy savings year after year.”
Blue Planet Foundation conducted market research in December 2009 to discern the level of public support for a barrel tax for clean energy investment. The statewide survey of residents found broad support for a barrel tax with over two-thirds supporting a tax of some amount. The average level of support was equivalent to a $5 per barrel tax. Forty-two percent of residents supported paying an additional $15 on their monthly energy bills, equivalent to a $9 per barrel tax.
While Blue Planet acknowledges that residents who choose not to alter their energy behavior will pay a nominal amount additional on their energy bills. But the intent of the policy is to hasten the transition to an oil-free economy to prevent disruptive economic impact as the price of oil climbs with its scarcity.
“It‟s a matter of economic security, said Mikulina. “We have to leave oil before oil leaves us.”
2. PACE: Property Assessed Clean Energy (HB 2643)
Property assessed clean energy—or PACE—bond financing overcomes the biggest barrier to energy efficiency and clean energy investment: the up-front cost. The concept behind PACE is to make bond funding available for residential efficiency improvements and solar installations. The bond financing is then repaid over time through the investing residents‟ property tax bills. Residents benefit by having a lower total cost of home ownership immediately; the state benefits with an increase in efficiency and clean energy; and the economy benefits from having steady growth in high-tech clean energy and efficiency jobs.
The proposed program would work like this: proceeds from the PACE bond (currently unspecified in the measure) are lent to residential property owners to finance efficiency improvements and small renewable energy systems. Owners then repay their loans over a prescribed time period via an annual assessment on their property tax bill. The liability to repay the bond is attached to the property, rather than to the individual, as an assessment on real property. By eliminating the up-front cost of energy efficiency investments, PACE financing is one of the most powerful tools to increase adoption of smart energy technologies (such as solar water heating, photovoltaic, and efficient appliances).
PACE bonds were ranked one of the Top 10 “Breakthrough Ideas for 2010” by Harvard Business Review. The PACE program will increase energy security, encourage economic diversification, provide increased career opportunities for Hawai„i residents, and attract funding and investment into the State.
Blue Planet Foundation CLEAN ENERGY MEASURES 2010 Page 3 of 5
“Property assisted bond financing will be a game changer for residents seeking to install solar or efficiency measures,” said Mikulina. “It will bring down the cost of living in Hawai„i while decreasing our reliance on imported oil and creating local jobs. It is a win-win-win.”
3. Properly funding the Public Utilities Commission (SB 2809)
The public utilities commission is charged with developing and enforcing policies that govern the lifeblood of Hawaii‟s economy: electricity. They need to be properly funded to successfully navigate the multi-billion dollar transition to a clean energy future. The full amount of revenue generated in the special fund should be dedicated to the public utilities commission.
Currently, the public utilities commission (PUC) is funded through the PUC special fund which collects funding from various sources, most significantly an annual fee of one-half of one per cent of the gross income of the public utility‟s previous year‟s business. Over half of the revenue in this special fund—which receives about $17.5 million annually—is diverted to the state‟s general fund, however. For fiscal year 2009, of the $17.6 million in revenue generated, $8.3 million was expended by the PUC while $9.3 was diverted to the state general fund. The PUC is currently deliberating dockets that will fundamentally reshape Hawaii‟s electric utility sector. Smart grid, utility decoupling, feed-in tariffs for clean energy, integrated resource planning— these dockets require thorough deliberation, research, and expert input. The PUC must have the talent and resources to adequately investigate and develop the right policies for Hawaii‟s 21st century electricity industry. The total funding available to them through their revenues should be available for their work.
The current draft of the measure (SB 2829 SD1) does not specify the amount of funding that the PUC would receive from the PUC Special Fund.
“The public utilities commission needs funding to navigate the multi-billion dollar transition to a clean energy economy,” said Mikulina.
4. Electric Vehicle Incentives (SB 2231)
Electric vehicles (EV) will play a large role in Hawaii‟s clean energy future. By using stored electrical energy, EVs can take advantage of intermittent solar, wind, and other clean energy resources. Most vehicles sit idle 22+ hours of the day, so they become de facto energy storage devices if their batteries are plugged into the grid when they are not in use. With smart grid infrastructure in place, EVs become an essential component to electricity load and clean energy resource balancing—in addition to providing clean mobility solutions for Hawai„i residents and visitors.
Senate Bill 2231 exempts from the state general excise tax the sale or lease of electric vehicles and the installation of charge spots.
Blue Planet Foundation CLEAN ENERGY MEASURES 2010 Page 4 of 5
5. Encouraging Private Clean Energy Investment (SB 2488)
Senate Bill 2488 expands one of Hawaii‟s most effective policies at increasing distributed clean energy resources. This bill will expand the allowable system size for net metered systems, increase the total clean energy penetration limit, allow solar energy credits to be valued beyond the current one-year cycle, and direct the public utilities commission to adopt best practice interconnection standards for solar and other clean energy systems. This measure will encourage further investment in customer-sited clean energy systems statewide, further reducing Hawaii‟s dependence on fossil fuel and moving toward energy independence.
After wisely being passed in 2001, net energy metering slowly began with a handful of renewable energy generators. As more homeowners learn about the program and its impacts on the payback period for renewable energy devices, the subscription rate has dramatically increased. In fact, we may be nearing a “tipping point” where many residential customers invest in renewable energy devices because of their relative cost and environmental advantages.
Senate Bill 2488 SD2 picks up where prior legislation left off—expanding the allowable system size, reducing grid connection limitations, and allowing net metered customers to be compensated for excess energy for a three-year period, among other improvements.
