STAND. COM. REP. NO. 1530

Honolulu, Hawaii

RE: S.C.R. No. 200

S.D. 1

Honorable Ronald D. Kouchi

President of the Senate

Thirtieth State Legislature

Regular Session of 2019

State of Hawaii

Sir:

Your Committee on Commerce, Consumer Protection, and Health, to which was referred S.C.R. No. 200 entitled:

"SENATE CONCURRENT RESOLUTION REQUESTING THE PUBLIC UTILITIES COMMISSION TO APPROVE A SUBSIDY THROUGH UTILITY RATES FOR REASONABLE RATEMAKING TREATMENT TO LESSEN THE BURDEN OF ENERGY COSTS ON LOW- AND LIMITED-INCOME AND SPECIAL MEDICAL NEEDS CUSTOMERS,"

begs leave to report as follows:

The purpose and intent of this measure is to request the Public Utilities Commission to approve a subsidy through utility rates for reasonable ratemaking treatment to lessen the burden of energy costs on low- and limited-income and special medical needs customers.

Your Committee received testimony in support of this measure from the Department of Human Services; Hawaiian Electric Company, Inc.; Maui Economic Opportunity, Inc.; Parents and Children Together; Aloha United Way; Honolulu Community Action Program, Inc.; Helping Hands Hawai‘i; and Hospice Hawai‘i. Your Committee received comments on this measure from the Department of Commerce and Consumer Affairs and Public Utilities Commission.

Your Committee finds that Hawaii's high cost of living greatly affects the low-income population and utility customers with special medical needs. Although the rates for rent and mortgages in Hawaii are the highest in the nation, the median earnings are only slightly higher than the United States median at $46,978 per year. Utility costs associated with special medical needs, such as life support equipment or increased cooling due to a medical condition, can be unrelenting and can easily cause an individual or family to lose their financial stability. This measure lays the framework for electric utility companies to pursue programs to help low-income and special medical needs customers and allows the Public Utilities Commission to approve a subsidy through ratemaking to help lessen the burden of energy costs for underserved customers.

Your Committee notes the testimony from the Department of Commerce and Consumer Affairs expressing concern that there are already a number of existing programs that provide assistance for low-income customers and requiring the Commission to approve one specific subsidy model may not be sustainable and could result in unintended consequences. The Department of Commerce and Consumer Affairs testified that providing the Commission with more flexibility will help ensure that all customers benefit and that, where necessary, innovative and cost-effective solutions that do not result in unintended consequences are explored and developed. Therefore, amendments to this measure are necessary to address these concerns.

Your Committee has amended this measure by:

(1) Clarifying that the Public Utilities Commission is requested to consider, rather than approve, reasonable ratemaking treatment and cost-effective solutions to lessen the burden of energy costs on low- and limited-income and special medical needs customers;

(2) Requesting that the Public Utilities Commission and interested stakeholders to explore cost-effective solutions;

(3) Amending its title in accordance with its amended purpose; and

(4) Making technical, nonsubstantive amendments for the purposes of clarity and consistency.

As affirmed by the record of votes of the members of your Committee on Commerce, Consumer Protection, and Health that is attached to this report, your Committee concurs with the intent and purpose of S.C.R. No. 200, as amended herein, and recommends that it be referred to your Committee on Ways and Means, in the form attached hereto as S.C.R. No. 200, S.D. 1.

Respectfully submitted on behalf of the members of the Committee on Commerce, Consumer Protection, and Health,

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ROSALYN H. BAKER, Chair