Blue Planet Sets Preferred Course for Lawmakers With Recession-Busting, Job-Creating Tools; plus: Hawaii’s ‘Declaration of Energy Independence’

State legislators, their staffers and energy experts

met in the Capitol today on proposed renewable energy policies.

1/13 Update: Ted Liu says a "smart" electric grid will improve reliability and accommodate renewable energy advances.

Blue Planet Foundation’s “Clean Energy Policy Forum” in the State Capitol today was timed nicely for the beginning of the State Legislature’s 2009 session next week. Though few in number, legislators present included the chairs of the Senate and House energy committees – Senator Mike Gabbard and Representative Hermina Morita respectively.

Foundation head Henk Rogers, executive director Jeff Mikulina and several mainland experts presented components of a legislative package designed to achieve “more than energy security.” The package is intended to:
• bust the recession with tools to plug the $6 billion-plus annual payment for imported fossil fuel;
• create high-paying jobs in the renewable energy industry;
• protect the environment and decrease Hawaii’s annual contribution of 22 million tons of greenhouse gas;
• spur a high-tech economy by making the state a hub for clean energy research and development;
• create the Hawaii model in indigenous energy solutions for others around the globe to follow.

This is going to be a long post, but it’s worth devoting this much space to the Foundation’s policy recommendations; if implemented, they would move Hawaii along the path of becoming a world clean energy model.

Efficiency Policy Recommendations
1. Create the framework for dramatic increases in efficiency.
• Declare that energy efficiency shall be the first priority resource for new electric system resources in Hawaii.
• Establish an “energy efficiency resource standard” requiring annual energy efficiency program electricity savings equivalent to 3 percent of 2008 retail sales by the end of 2011, 10 percent by the end of 2015 and an additional 2 percent per year each year thereafter.
• Establish a system of incentives and penalties by a third party administrator and the utility for achievement of efficiency goals.
2. Provide real resources for efficiency investments.
• Establish a system benefit charge to provide a minimum energy efficiency program funding equivalent to 2 percent of total retail electricity sales revenues in 2009, 3 percent in 2010 and 4 percent in 2011 and each year thereafter.
• Establish a revolving fund from a fee on imported barrels of oil where customers could secure low-interest financing for energy efficiency improvements.
• To overcome an upfront cost barrier, allow customers to repay the cost of major energy efficiency measures through their bills.
3. Encourage design of smart, efficient buildings.
• Establish statewide energy efficiency building codes for residential and commercial new construction that are at least 30 percent more efficient than the current IECC codes. (Also, consider a state policy to keep Hawaii “best in nation.”)
• Create a “Time of Sale Efficiency Standard” requiring residential and commercial properties to be brought up to the energy efficiency standard upon transfer of ownership.

Clean Energy Policy Recommendations
1. Align Hawaii’s energy policy with a clean energy future: Allow no new fossil fuel generating plants.
• Exemptions could be created for emergency stand-by generators of less than 2 megawatts for hospitals, etc.
• This policy would be the nation’s first among the states.
• Hawaiian Electric Company supports this recommendation.
2. Create the path to clean energy.
• Clarify the current renewable portfolio standard’s (RPS) language to ensure that only clean, indigenous resources are counted.
• Set the RPS at 15 percent by 2015, 25 percent by 2020 and 40 percent by 2030.
• Establish clear penalties or “alternative compliance” mechanisms for a utility’s failure to achieve the standard.
3. Accelerate clean energy adoption.
• Remove the “avoided cost” barrier in HRS 269 that may prevent renewable energy adoption when oil prices are low. (Under current law, utilities’ payments to independent power producers is set at no less than the cost they avoid spending on imported fossil fuel. Low oil prices translate to low renewable energy payments.)
•Enable the counties to begin community-based “renewable energy zone” identification processes for permitting and transmission purposes.
• Ensure solar access – i.e., clarify that customers with solar devices have rights to the solar resource.

Mobility Policy Recommendations
1. Smarter: encourage efficient vehicles.
• Adopt California’s “Clean Car” standards to foster purchase of high miles-per-gallon cars in Hawaii (18 states already have adopted such standards).
• Establish a “Feebate”: incentivize high-efficiency vehicles and penalize the gas guzzlers for their negative impact on society.
• Mandate that all gas stations provide working, free air and tire gauges for filling tires to proper pressure and thereby provide up to 5 percent greater vehicle energy efficiency.
2. Better: increase indigenous fuel substitution.
• Establish biofuel support with market stimulation incentives for the development of biodiesel in the islands.
• Make state agricultural lands available for biodiesel fuel crops.
• Create a tax exemption for the development of indigenous biofuel sources within a reasonable time frame – such as 5 years.
3. Different: alternatives to internal combustion.
• Support electric vehicles and clean energy by directing the Public Utilities Commssion to create a preferential rate for electric vehicle charging from indigenous renewable energy resources.
• Direct the Department of Transportation to provide true bike lanes, and establish bike lane requirements when roads are being resurfaced and upgrade.

Integration Policy Recommendations
1. Make energy a priority.
• Create a State Energy Security Office as a stand-alone entity within the Governor’s office by moving the current DBEDT energy office.
• Coordinate system-wide planning through the office.
• Fund the office with a portion of the “barrel fee.”
• Consider establishing an energy commission to provide oversight.
• Direct the energy office to develop a state energy master plan covering backbone planning, transmission and distribution with long-term planning and commitment.
2. Encourage storage on the grid.
• Provide an incentive for energy storage or creating firm capacity that can be fed to the grid.
• Direct the PUC to implement a schedule of incentives dpending on technology type, location and availability (i.e., electric vehicles, capacitor banks, pumped hydro, batteries, etc.)
3. Recharge the Public Utilities Commission.
• Provide ample resources through the “barrel fee” for the PUC to research, deliberate and implement the critical list of energy issues they are charged with overseeing.
• Increase the transparency of PUC actions and initiation of PUC dockets; set public notice guidelines for increased public participation and awareness.

The ‘Zero Tolerance’ Quest

Rep. Pono Chong asked the 64-dollar question at the end of the presentation by suggesting that attaining “zero tolerance” as a public policy (with drugs, as an example) hasn't had much success. He asked how realistic it is to expect zero fossil fuel use in Hawaii’s future.

Denis Hayes, who was present for the Foundation’s Blue Planet Summit last April and participated in this weekend’s policy forum, responded that unleaded gasoline is an example of a “zero tolerance” policy that has in fact worked. Mikulina observed that getting to 100 percent renewable reliance requires first that we achieve 5 percent, then 10 percent and so on. Hawaii has to start with the achievable early goals and strive hard to reach full compliance as a consequence of early successes, he said.

Hayes also noted that finding substitutes for jet fuel is likely to be the last step in going completely fossil fuel free. Achieving that goal may require technological breakthroughs that can’t even be imagined today but which could make current concerns seem irrelevant in a few years. Also weighing in on the subject was Kyle Datta, founder and president of New Energy Partners, who said Hawaii is positioned well to achieve substitutes for jet fuel. He said the state is one of the few places in the world that knows how to grow algae at industrial levels thanks to years of research and development at the NELHA laboratory on the Big island.

Geothermal’s Potential

Chairman Gabbard asked about the potential for that island’s geothermal field to be expanded and thereby make greater contributions to the state’s renewable energy mix. (Geothermal has been capped at 30 megawatts since the 1990s; plans to grow the field to as much as 500 MW and ship the energy to Maui and Oahu via undersea cable were scrapped in the face of religious and environmental opposition.)

Jon Hurwitch, principal of Sentech, Inc., said every energy option has consequences, but continuing the status quo option of overwhelming reliance on imported oil and coal – resources over which the state has no control – is the worst option of all. He said just about all visiting energy experts see great potential in the Big Island’s geothermal field – up to several hundred megawatts, more energy than could be consumed on the island. Conversion to hydrogen for use in fuel cells is a possibility, as is transmission using an undersea cable. “Geothermal energy is critical to freeing yourself from oil,” Hurwitch said.

Henk Rogers said Blue Planet already has begun a dialogue with Hawaiian leaders and hopes to continue discussions with the community about whether Madame Pele’s bounty might be used for the benefit of the islands’ population.

A ‘Declaration of Energy Independence’

Rogers wrapped up the session by agreeing that 100 percent reliance on renewable energy is a huge goal, “but at some point we need to declare our energy independence.” He then proposed such a declaration, which is still in working draft form:

“We, the people of Hawaii, in order to end our state’s debilitating energy dependence, do hereby declare our intention to secure our energy future by replacing imported fossil fuel with renewable indigenous resources.”

Our apologies to Henk if we missed some of his intent and wording. Whatever its final form, here’s hoping the people of this state and their elected representatives endorse it.