 I'm your host today, Michiuan. Our underwriter is the Hawaii Energy Policy Forum, and that's a program of the Hawaii Natural Energy Institute. So I'm really pleased to welcome our guest, Adam Strubeck, who actually works for the Hawaii Energy Policy Forum, as a graduate research assistant. And today, we're going to be talking story about some of the federal energy policies that just come out, and they're really thick documents, and they're hard to go through. But we're in luck because Adam has worked his way through him, and he's going to kind of demystify them for us and say, tell us what's in it for us. And so there's basically gold in them on our hills, as they say. And to save you all the trouble of having to read through these really complicated bills, like I said, Adam's done all the work. So Adam, I welcome to the show. And how about Tony? Yeah, it's great to have you here. And I've been enjoying working with you. So tell us a little bit about yourself, like where are you from? What's your interest in planning and policy? And when do you graduate? That's really good to know. Sure. Well, I'm originally from Boston, Massachusetts. This is my second semester here at the University of Hawaii in the Urban and Regional Planning Master's Program. I've been working for the Hawaii Energy Policy Forum since this August. So right when this new legislation was passed, then I'm excited to get into the federal policy. Good. So let's just get on with it now and start looking at this policy that you've unwrapped. So well, let's go to slide two. And let's talk a little bit about the inflate, what they've called the Inflation Reduction Act. That's kind of a funny name. But what is it and what does it do? Sure. So the Inflation Reduction Act, a lot of people criticize it because they don't think that it will actually reduce inflation. But I think what's more important is that there's lots of energy policy that's relevant to us here in Hawaii in this act. There also includes legislation on corporate taxes, health care, energy, and climate. So like I said, we're going to focus on the energy legislation, which totals around $370 billion. So that's about $1,100 per person in the US. That's a lot of money. That is a lot of money. So we need to figure out how to best take advantage of this. And these icons at the bottom of the screen are some areas that I think are really important to this act and really important to people that want to benefit from the act. So these are the areas of clean energy, energy efficiency, community resilience, energy storage. Hang on, hang on. So I got to ask these skill testing questions. Like what is resilience? Just so people out there might not know what that is. Sure. So when we think of resilience and planning, we're really thinking about how strong a community is to outside stressors. A stressor could be a major storm, even just a simple power outage or break in supply chains. How is the community bouncing back from these issues? And what steps can we take as planners to ensure that communities can come back stronger from different problems that they may come into contact with? Right. So I'll tell us, what are we talking about? We say storage, what does that mean? This really means energy capacity. So right now in Hawaii, we import most of our energy in the form of petroleum. And that's because petroleum is really good at storing energy. It's very energy dense. Right. And part of the problem with renewables like solar is that we're not able to use them at nighttime when the sun goes down. So to go against this, we need really good energy storage so that we're able to access energy whenever we need it and implement into our transportation and commerce systems here on the island. Right. And so just a few words about environment. We all know what the environment is, but environmental stuff. Right. And I think the environmental aspects of the Inflation Reduction Act are really important. There's a lot with emissions and clean air. So really about protecting the public goods that everyone enjoys, but doesn't necessarily have a stake in what happens. So there's a lot of legislation that we can get into that deals with regulating pollution and protecting the environment. So these are all good issues that everybody should support, like who would be against the environment or resilience or clean energy, et cetera. So let's go to the next slide. And I mean, part of the mechanisms they use are tax incentives. And so that means modifying the tax code. So how about educating us a little bit about what they say about the tax code in the legislation? Great. Well, the Inflation Reduction Act works in primarily two ways. One is by modifying the tax code to include production credits and investment credits. And the final way is through direct funding to agencies for grants and loan programs. And some of the other aspects of the act include modifying corporate taxes. So some of this new money that is being gained from tax incorporations will go into these production and investment credits. Both individuals, like individual homeowners and residents can tap into it, but also our businesses can also tap into this. So it's good for business. If you're a business out there and you want some financial relief or credits for what you do, you should dial into the HEPF website and see some of the work that Adam has done to make it easier for you to figure out what kinds of areas you could qualify for. So let's look at those agencies though in the next slide, slide four. So tell us about these programs, these various agencies. Sure. So the act actually distributes funding to over 20 government agencies, but these three main agencies receive almost two thirds of the total funding. And those three agencies are the Department of Energy, Department of Agriculture or USDA and the Environmental Protection Agency or EPA. So the DOE or Department of Energy is receiving about 35 billion, the USDA $46 billion and the EPA $41 billion. So that's a lot of funding. Those are eye-widening numbers. So, okay. So let's look at each of those agencies on this slide and let's look at some of the programs that they're funding. Sure. So just to give you an example among the Department of Energy programs, there's grants for converting manufacturing facilities for traditional cars to upgrading them into facilities that can produce electric vehicles. There's also incentives for energy producers to reduce their emissions and also funding allocated for planning large scale energy products such as transmission planning or also home efficiency planning programs. So could that help us with our grid here in Hawaii? I mean, one of the comments I've heard a lot is we get thousands and thousands of electric vehicles on plugging into the grid. So we're not quite sure, we are pretty sure that the grid can't handle it at scale. So with this program help our electric utility here to harden their utility transmission lines. Is that part of what the thinking is here? I think that is certainly part of the idea of transmission planning. I think we have a head start here in Hawaii because we already use a lot of these technologies that the bill is trying to foster. So we should be able to attract a lot of federal funding but each project is specific on which type of funding it can qualify for. So that's part of the tricky part of this bill is figuring out which programs within which agency a certain project will qualify for. And if you go to the HEPF website though you've kind of done the homework on that in more detail. Yeah, we do have a lot of drop down menus for the different programs. So we're currently tracking the different milestones that and requirements that different individuals or businesses need to meet to qualify for these programs. So the point is that this is a really good resource. I'm gonna be pounding that home as we go through our interview here. So let's talk about the USDA because we have a lot of interest here in Hawaii in our agriculture. So you talk about rural electrification. You'll recall I had one of my shows this month talked about the electrification of agriculture starting with electric tractors. So I'd like to talk a little bit about the USDA programs. Right, so this is more geared towards like you said agriculture and rural communities. So the USDA oversees a program called REAP, R-E-A-P which is the Rural Electrification for America program. And this is loans and grants for agriculture for rural and small businesses in rural areas. So a lot of farmers can take advantage of these programs and transition their systems over to renewable energy systems both for their heavy machinery and for any sort of agricultural buildings that they may use. Yeah, that's interesting. You know, I mean farmers farm and a lot of them don't have the time to go after these programs. That's one of the comments I've heard back from farmers like, you know, if you're working from down to dusk and you're, you know, totally exhausted at the end of the day who has time to go through these bills and fill out all the forms that apply for these things. So once again, this is another tool that we have at HEPF of the forum to try to make this a little bit easier and also for other people that are consulting the farmers so that they really understand what's available. So talk a little bit now about conservation and forestry, if you may. Right, so like we mentioned it's not just energy legislation that's in this bill. The funding that's going to the USDA is also going towards forest conservation and conservation funding for the different agencies that oversee national parks and like marine sanctuaries. So I think it's pretty important aspect of the bill because a lot of our natural resources come from areas that benefit from conservation. And it goes to show that the bill is taking sort of a comprehensive approach to addressing climate change and it's not just solely focusing on energy policy. Okay, great. So finally, let's go to the EPA and what their programs are. The EPA has gone through a lot of changes kind of getting whiplashed around but this just tell us about their programs, if you may. Yeah, so the big takeaway I think from the EPA programs are that they're trying to put a price on the cost of methane, the emission of methane, which methane is a greenhouse gas that's even more detrimental to the environment than carbon dioxide. So we really wanna be focusing on eliminating as much methane production as possible. So the EPA is doing this by taxing methane production as well as incentivizing the production of methane emission reducing technologies. So air quality and emissions is really the big aspect of the EPA funding. So what is, I see this term a lot and other people on the audience may not understand what it means, but environmental justice, what does that mean? Right, so this really means fair treatment of communities while we're developing and implementing policies. I think an example that easily comes to mind is a town in rural America that was used for coal mining. Someone's gotta look after these communities as we transition away from resources like coal and retrain people for greener jobs. So in a lot of these programs throughout the three agencies there's bonuses if the activities are taking place in what's known as an energy community, which is an area where we're transitioning to a new sort of clean energy economy. Such as a coal, small coal mining town, for example. The same is true with large petroleum areas. So at the end of the day, environmental justice is sort of bringing everyone to the table and accounting for people that may be left out of some aspects of the policy. So like if you look at, if you apply that to Hawaii, I mean the West coast of Oahu, you know, the Waianae area, you know, they're overloaded with industrial companies, industries there and, you know, they have the big landfill out there. And then of course we have the refineries out there. So is this something that would be applicable to that community? Yeah, I think there's $3 billion to establish programs to provide grants for community led projects and disadvantaged communities. So I think states really have to compete for this money, but I think there's a lot of money to go around and every state should be able to identify areas that would qualify for these programs. So that was $3 billion, you said, right? Right, which is just, yeah, just a small part of the EPA's budget on this. So I reconmember in the day when $200 million for the Department of Energy Hydrogen Program was a really good year. So $3 billion is a lot of money. And so, you know, for the people who are living on the west side of Oahu and other areas on our other neighbor islands that are kind of in that kind of a situation, here's an opportunity for you to develop programs to improve your quality of life. So that's a good thing. So let's move on to the next slide. I think we've, we want to talk a little bit now about production tax credits. So if you mind going through the talks, tell us about production tax credits. What are they and are they used? Sure, so production tax credits is basically like a subsidy for producing renewable energy. So it makes it less expensive to produce renewable energy. And this includes solar, wind, geothermal, hydropower, biomass, hydrogen, and carbon capture technology. So there's different tax incentives for the production of each of these systems. And this is as long as construction of a project begins before 2025, they can take advantage of this tax credit. So 2025 is rolling down the track pretty fast. So, you know, what happens after 2025? You don't qualify anymore? Does that basically use it or lose it? I believe that the production tax credits have the chance to get extended. Just how the legislation process works is they bump it up to 2025 and then maybe in a couple of years they'll extend it again. So I guess the message is, if you're out there in Hawaii and you have a good project, don't sit on it, get on with it and get your place in the queue before the credit goes away. So let's have the next slide, slide seven. And I'm sorry, slide six, which is investment tax credits. So yeah, I threw a loop by it to there. Yeah, no problem. So investment tax credits, I think, are more applicable to an individual because an individual is the type of person that's likely looking to start a small scale, new renewable energy system project, say for their house or business. So for new energy systems, there's a credit for 30% of costs. And whereas before this credit was somewhat limited, there's been a lot of expansion. So they've extended the credits to heat pumps and efficiency improvements in the home. Heat pumps are like a more efficient form of air conditioning and heating. It's one appliance that does both. So maybe not applicable to Hawaii where we use a lot of air conditioning, but I think there's some areas of the state that can benefit from both heating and cooling at certain times of the day or year. So if I wanna put thermal paying windows now in my house, I have this really thin contractors glass that the house came with because they tried to make it as cheap as possible. And so in the afternoon when the sun is setting and your house heats up through your windows. So if I go out and bought by a bunch of change out all of these crappy windows that I bought and put in thermal paying glass, I can get a 30% tax credit out of that. Yep, and what's really great about all of these tax credits that are in the bill is that they're able to be sold on the third market. So you don't- What is that? We're cooking, selling tax credit. Right, so traditionally you would have to wait until you file your taxes and claim these tax credits. But with a transferable tax credit you're able to transfer the benefit of your tax credit to say a larger business that has a lot of tax liability and could use your credit to offset that. So it's a way for people to monetize their tax credits. And I think it makes them a lot more effective than just waiting until your taxes are due to the file. So that has real appeal to low income population because a lot of them might not have that much tax because of their income, where they fall in the income. And so this way they can sell it to somebody who needs to credit and has the tax liability. So that makes that a really interesting program, I think. So I hope all of you out there are paying attention to this. This is a good deal. So let's go to the next slide and talk about electric vehicles. So electric vehicles are a big part of this bill. They're very trendy right now. Everyone is getting into electric vehicles. There currently exists a tax credit for EVs. And that tax credit with the Invest or Inflation Reduction Act is getting extended. But they're adding a couple of stipulations to that. And one of those is that the battery must be assembled in the US and components of the battery must be processed in the US as well. So there's some imported vehicles that aren't going to be able to qualify for the new electric vehicle tax. But if you buy them before the end of this year, you'll still qualify for that credit. Yeah, so I read a lot of the press about this tax credit saying there weren't that many vehicles that qualify it. But of course, we're not trying to ship our money offshore so other countries can use our money for their industry. So as industry reacts to this and ramps up US production, then that'll be good. Keep our keep our money in the US and make jobs for Americans. So that's that's a good thing. But I guess it'll take a couple of years at least, maybe two or three years for that to ramp up. So maybe they'll extend that, you know, because, you know, industry just can't quite need it yet, I guess is my comment there. So I see you have some limits on cars, like a fifty five thousand dollar car has to be less than fifty five thousand and trucks, they're really expensive, less than eighty thousand. You want to comment on that, or have I commented on it enough? No, that's good. So this is for new vehicles, less than fifty five thousand for cars and eighty thousand for trucks, vans and SUVs. A cool new feature of the Inflation Reduction Act is that it creates a tax credit for used electric vehicles. And that's four thousand dollars. And the sale price the sales price cannot exceed twenty five thousand dollars for that. So if you can find a used electric vehicle for twenty five thousand or less, you can have this additional four thousand dollar tax credit. So I think that's good because a lot of people may not want to go out and purchase or finance a new electric vehicle, but they may be more willing to purchase a used electric vehicle. That's already been depreciated. So it still goes for the mission of cleaning up cleaning up the energy sector. Yeah, so that's a good way to get those used cars out to create the turnover because people with a higher income, you know, they can go through their three year warranty or whatever and then trade in their car. And then the dealers that won't have won't be stuck with this inventory and they'll be able to resell it and it lets everybody have a piece of the action, even the lower income people. So that's a that's a good thing. Do you want to say anything more about that program or are we that to death? I think we're good. The one last thing I would say is that part of the investment tax credits from the previous slide also extends to electric vehicle charging facilities. So individuals can make that part of their renewable energy system. A lot of people are choosing now to integrate battery storage and electric vehicles part of their home system. So the storage and charging aspects of their home system would fall under the investment tax credits and additionally, there's this electric vehicle tax credit for their their actual transportation. Hey, great. So let's go to the next slide and talk about the incentives for sorry. We want to talk about clean energy dot gov. This is a really cool system. And so why don't you explain it to us and tell us how cool it is? Yeah. So clean energy dot gov is a new website that was published recently by the White House. And it's an extension of the administration's page on the inflation reduction act. It has this cool graphic, which is displayed on the slide, which basically looks throughout the home and summarizes the different tax incentives that are available. It sort of does this from four aspects, one being the production of energy. So this would be your home solar system transportation. We covered with the electric vehicle tax credit. Home and efficient efficiency is like windows, doors and insulation. And then resiliency, which is weatherization of the home. And there's even a new tax credit for improved energy roofs. So it sort of goes to show that the inflation reduction act is looking at energy from a holistic standpoint. It's not just about the production, but it's also about efficiency and decarbonizing different aspects of the economy. So basically you go to the website and you click on the blue dot, right? It tells you it opens up the screen and tells you what you qualify for, what your potential savings are. I think we were talking before the show yesterday, you said something about if you plug in your income level and maybe where you live and whatever pulls up a sort of a list of what kind of things you might qualify for, can you please make sure that I got that right? Yeah, what's great also about the site is that it's scenario based, meaning that you can say, okay, I want to buy a new card next year, or I want to install solar panels next year. And then it'll ask you those questions about your income and household situation. And it'll point you in the right direction there. So I think it's great because it's rather than just reading through the general tax credits, you can put in your unique situation and find out what credits apply to you. That's really great. They did that right. So let's talk about incentives for Hawaii in the next slide, slide nine. So let's talk about incentives for Hawaii. Tell us about this. Right, so I think as I mentioned earlier, Hawaii is already using a lot of renewable energy technology. But as you can see from the pie chart on the slide, we're still heavily dependent on petroleum for our energy generation. So it's really about maximizing the use of our renewable energy technology. And I think the Inflation Reduction Act has a lot of federal programs that'll speed us along that transition to clean energy. Just as a reminder to listeners that Hawaii has a commitment to 100% renewable energy portfolio by 2045. So regardless of whether funding is coming from federal, state or community groups, it's important to try to leverage the funding to speed us along that transition to renewable energy. So a large part of that brown part, which is fossil fuels, includes transportation, I mean, which is much harder than converting our grids over to renewable energy. Although that's hard too, although KIC is doing a great job on Kauaii. So let's go to the penultimate slide that's next to the last slide. And let's look at what the energy system might look like in 2045. And funnily enough, Hawaiian Electric came up with a nice little futuristic conceptions program. We've given you a link to their site. And I'll stop and let Adam talk because we're here to listen to Adam, not me. Sure. Well, this slide was sort of a conception of what a decarbonized energy system would look like in Hawaii. Decarbonized meaning not relying on fossil fuels and not emitting carbon dioxide or other pollutants. So this would rely heavily on geothermal wind, solar and hydrogen power. And those renewable energy technologies coupled with sufficient capacity and storage can allow us to use renewable energy for our commerce and transportation sectors. And with renewable energy in these sectors, we're well on the way to a decarbonized economy and a more self-reliant and resilient Hawaii energy system. That's great. It was a great vision. And like I said, go to that website, look at the Hawaiian Electric Futuristic program. They got artists to interview various people in various energy sectors and then draw and make a drawing of what they thought we'd look like in 2050 or 2045. So it was a really good program and it's really worth looking at. There's some really good artwork there too. So while we're getting pretty close to the end of our show, and I want to talk about this last slide and the Hawaii Energy Policy Forum. So maybe you can help us a little bit about how we can get to this, all this information. How do we get to all this good work you've done, Adam? Sure. Well, the Hawaii Energy Policy Forum website is nested within the University of Hawaii at Manoa website. So you can reach us at manoa.hawaii.edu slash agpf. We post information on clean energy policy and also we're gearing up for our 20th anniversary legislative briefing, which will occur in January. Yeah, really good. So like I said, a couple of times during the show, Adam's really done a lot of the heavy lifting. I'm really impressed with what he's done. And so he's going to make it easier for you people in the audience to be able to access this information. So that's really a really good job, Adam. I'm really pleased with what you've been doing. So that's, we're going to have to leave it there. I mean, we've blown through 30 minutes, which is pretty good. So we've been watching Hawaii, the state of clean energy on Think Tech Hawaii. And we've been talking story with Adam Strubeck, who's a graduate assistant, sorry, graduate research assistant with Hawaii Energy Policy Forum. And we've been talking about the federal energy policy, which is a dry subject on its own. But once you know that there's money in there for you, that becomes more interesting. And Adam's provided the tools for you to figure out how you can get money out of this program, which is always a good thing to do. So thank you, Adam. Great. Thanks for having me, Mitch. Great. And thanks to our viewers for tuning in. I'm Mitch Ewan. I will be back in two weeks with another edition of Hawaii State of Clean Energy and Aloha. Thank you so much for watching Think Tech Hawaii. If you like what we do, please like us and click the subscribe button on YouTube and the follow button on Vimeo. You can also follow us on Facebook, Instagram, Twitter, and LinkedIn, and donate to us at ThinkTechHawaii.com. Mahalo.