HB1522

SECTION 1. The legislature finds that in order for the State to make comprehensive and cost-effective assessments of investments in durable infrastructure projects, the cost of the greenhouse gas emissions associated with that infrastructure should be considered. A value assigned to the cost of greenhouse emissions is sometimes called a carbon price. While an explicit carbon price might be a tax or a fee levied directly on emissions, an implicit carbon price instead assigns a monetary value on greenhouse gas emissions that can then be factored into decisions as a way to account for climate-related risks and to align state actions with state policies that seek to reduce emissions.

The legislature further finds that the adoption of an implicit carbon price will help to guide decisions in the present so that actions taken now are in alignment with the transition to a low-carbon economy and adaptation to climate change. For example, assigning a value to avoided emissions that could be achieved through efficient new building design, effective stormwater infrastructure, or state vehicle procurement would lead to an accounting for the costs of these projects that incorporates a full range of costs over the medium- and long-term, rather than only the short-term. This would further result in more cost-effective outcomes for the State.

The legislature further finds that the adoption of an internal carbon price today would benefit the State by positioning Hawaii to be ready for tomorrow. Should a carbon price be adopted nationally—and there is a reasonable expectation that this may come to pass — there would be early advantages for the state government for having already made some of these adjustments.

The legislature also finds that the public utilities commission should develop estimates for a social cost of carbon and that regulated electric and gas utilities should be required to use these estimates in each utility's integrated resource planning process to account for the cost of carbon emissions.

Accordingly, the purpose of this Act is to require:

(1) The public utilities commission to develop an estimated social cost of carbon;

(2) Each regulated electric and gas utility to use the estimated social cost of carbon in that utility's respective integrated resource planning process; and

(3) The State and the University of Hawaii to consider the estimated social cost of carbon in planning new infrastructure and capital improvement projects.

SECTION 2. Chapter 225P, Hawaii Revised Statutes, is amended by adding a new section to be appropriately designated and to read as follows:

"§225P- Social cost of carbon; new infrastructure; capital improvement projects; requirements. (a) The State and University of Hawaii shall consider the estimated social cost of carbon developed under section 269- in planning new infrastructure and capital improvement projects.

(b) As used in this section, "social cost of carbon" shall have the same meaning as in section 269-1."

SECTION 3. Chapter 269, Hawaii Revised Statutes, is amended by adding a new section to part I to be appropriately designated and to read as follows:

"§269- Social cost of carbon; estimate; requirements. (a) The public utilities commission shall establish an estimated social cost of carbon.

(b) Each electric or gas utility that is regulated by the public utilities commission under this chapter shall use in the utility's respective integrated resource planning process the estimated social cost of carbon developed under subsection (a).

(c) The public utilities commission may use the estimated social cost of carbon developed under subsection (a) in assessing penalties for delays in integrating renewable energy projects and programs that lower carbon emissions."

SECTION 4. Section 269-1, Hawaii Revised Statutes, is amended by adding a new definition to be appropriately inserted and to read as follows:

""Social cost of carbon" means an estimate of the economic costs and damages created by each ton of carbon dioxide emissions."

SECTION 5. Section 107-27, Hawaii Revised Statutes, is amended to read as follows:

"§107-27 Design of state buildings. (a) No later than one year after the adoption of codes or standards pursuant to section 107-24(c), the design of all state building construction shall be in compliance with the Hawaii state building codes, except state building construction shall be allowed to be exempted from:

(1) County codes that have not adopted the Hawaii state building codes;

(2) Any county code amendments that are inconsistent with the minimum performance objectives of the Hawaii state building codes or the objectives enumerated in this part; or

(3) Any county code amendments that are contrary to code amendments adopted by another county.

(b) Exemptions shall include county ordinances allowing the exercise of indigenous Hawaiian architecture adopted in accordance with section 46-1.55.

(c) The State shall consider hurricane resistant criteria when designing and constructing new public schools for the capability of providing shelter refuge.

(d) The State and University of Hawaii shall consider the estimated social cost of carbon developed under section 269‑ when designing and constructing new buildings.

(e) As used in this section, "social cost of carbon" shall have the same meaning as in section 269-1."

SECTION 6. New statutory material is underscored.

SECTION 7. This Act shall take effect upon its approval.

INTRODUCED BY:	_____________________________

HOUSE OF REPRESENTATIVES	H.B. NO.	1522
THIRTY-FIRST LEGISLATURE, 2022
STATE OF HAWAII