 We're back, we're live. I'm Jay Fiedel here on ThinkTech. Welcome to Hawaii, the state of clean energy on ThinkTech. So our show today is called, we call it, an afternoon with Representative Chris Lee. We're going to talk to Chris about energy and transportation. We address the issue of whether there's a miles to go for us to get a hand on energy and transportation in Hawaii. Now if you want to ask a question, participate in the discussion, you can tweet us at ThinkTechHI or call us at 415-871-2474. And we also have my co-host, Meena Merida. So let me get this straight now. Chris is the chair of the House Energy and Environmental Protection Committee right now today. However, Meena Merida is his predecessor and for many years she was the chair of that very same committee and thence she was the chair of the PUC. This is a totally VIP show. And there was one person in between us, Denny Hoffman. Yeah, you mentioned that. Yeah, for a short while. So first we should talk about the session, Chris, because you know we need to hear it from you. We've heard it from many people. Many people have talked about this session as a special, special session. And I don't mean that in terms of a session that meets in the summer. I mean the session that met in the spring was special. You know, it was a very different year than I think most people have ever seen before. Number one, in D.C. you've got, you know, Trump Administration, which is placing a lot of pressure on federal funding and all kinds of stuff. Nobody knows what's going to happen. But locally, we had a lot of big issues. Rail returned, among other things, that kind of blew up at the end of the session. And that sort of cast, So I want to kind of take this kind of logically. First of all, what was the highlight for you personally in this session? You know, there's actually a lot, I mean, I think despite all those headlines that we're just talking about, that did happen. One thing that really stood out was something that went completely under the radar, didn't get a single piece of coverage anywhere. It was a piece, it was a resolution that the state passed. We passed it unanimously, Republicans, Democrats, House and Senate. And what it did was it made Hawaii the first state in the country to say that it should be a right of all families to be financially, economically secure. And then sets up a process to help get us there and evaluate things like a universal basic income and other mechanisms that are being talked about. Wouldn't that be great, huh? But haven't yet been done here in Hawaii. Yeah, that would be great. We've got local support too. Piro Midyar just put in a whole ton of money into a pilot project in Kenya, I think almost half a billion dollars to give out to people to test what this would mean for an economy. And what we would do here in our own economy, which is very exposed to automation and loss of jobs because of those harness of vehicles and all the kinds of things that are coming down the pipe. So that's something which is, I think, the real world. So the next step for that resolution is to, is this a study or how is it structured? It's a working group. So it's going to be the Department of Labor and the Department of Business Economic Development Tourism, Chamber of Commerce Labor unions, everybody coming together to figure out how much are we currently spending as a state on social services? What is our exposure in our economy to automation and job loss and all these sorts of things coming up? And what will that mean financially for the state? And starting with that baseline, we can then evaluate meaningfully, what will it cost to actually make sure that we have a future here for our families and an economy that's sustainable? Wow, that's pretty visionary actually. Is there a deadline on that, on that committee? Are they supposed to report back to somebody by a certain day? Yeah, we'll be getting a report back beginning of next year right as the legislature reconvenes. That's great. We want to follow that and see what happens. So interesting it didn't get that much publicity. So are there any bills sitting on the governor's desk that was a highlight for the legislature as a whole? I think the legislature as a whole. There is one that stands out and it does go back to cost of living and all the big stuff we're seeing here. And it's a bill that finally starts to give money back to local residents. Earn income tax credit. Earn income tax credit. Which we have been a champion for long before any of us were around. Are you saying I'm old? I'm saying you've led the way. But yeah, so after decades of Hawaii not providing something like this that most other states do, we're finally being able to give support to working families in a meaningful way. Yeah, that's big, that's great. How about in the energy environmental realm? Yeah, off the top of my head, not only are we kicking more money over to our schools for energy efficiency and other things, but there is a bill that would set up a process for farmers, local farmers in the ag sector to be able to be compensated and qualify for carbon credits to sequester carbon. And that's something which could be a sorely needed revenue stream for a lot of folks, particularly when it's done in conjunction with PV and other renewables that they can use to help offset their own emissions. Is that likely to be signed? I think so. I think we've got favorable, I mean I think almost all the testimony, I think all the testimony actually was in support and right now Hawaiian Airlines among other local companies are looking at putting in millions of dollars in carbon offsets and we want to be able to keep that money here in our own economy and reinvest it. So this would be a vehicle to do that. That's good for agriculture, that's the important thing. Yeah, they need various income streams and definitely this helps. You were going to ask Chris about the bill that provided a target for clean energy and transportation. I know you are. Right, you know, we're all watchers here and so one of the bills that we were watching was House Bill 1580 and I guess the main portion of that bill was setting renewable fuels targets and you know we saw what happened to it at the final hours of conference committee and so you know understanding that it's a really big task to come together to put guiding principles policies forward. Have you any suggestions on how to tackle kind of gnarly big policy issues like saying these kinds of targets but more so because we're anticipating so many disruptions in the transportation sector with things like autonomous cars so advancing technologies. Do you have any suggestions on how to move forward on these big picture kinds of issues and the policies needed? Sure, you know I think 1580 was a bill that I think was one of the first years we've had a real significant discussion at the legislature about electrifying transportation and what that means in decades from now but the bill when it died didn't die on its merits. I think there was large consensus in the House and Senate that this was the general direction that we wanted to go and our law right now our state plan currently says that we want to eliminate fossil fuels for ground transportation here in the state. It doesn't have a date attached to it but that's just a guiding principle and so this would have taken that next step. I think one of the things that we did see out of that prior law passed a couple of years ago is the Department of Transportation getting together with the energy office creating this working group with a whole bunch of different stakeholders to look at what are those realistic actual actionable steps and what's the low-hanging fruit to get started on as we make this transition. I think that's something that especially now has been invaluable so if we're going to move forward now to this next step and figure out all right what's realistic and how are we going to get there. I think for sure we've got to try and analyze as best we can what resources we have locally to be able to leverage. And right now I just got back from California actually meeting with their Senate president who's been doing a lot of work in this area as well as the Energy Commission and the PUC their CPUC and they're all working in the same general space as we aren't here and of course they've got a lot more resources to bring to bear. And they have a market if you drive the market. That's right and they are driving the market as we speak and one of the guys was just saying you know right now their their current goal is to sell 100% zero emissions vehicles by 2050 and they're looking at advancing that potentially as much as 10 years based on what the market's actually done in some of these places in California right now and so they're putting hundreds of millions of dollars in various channels to try and tackle this problem of how you actually get from here to there. And so there's a couple things I think people don't realize that are already happening that will probably have much more influence in where we go than any policy we could put into law. You know when I was graduating from high school which was only a few years ago like 1999 I don't know if it was a few years ago but at that point driving in Hawaii was it was a must-do and it was a real desire for everybody. I remember in our high school everybody wanted their driver's license at that time in 1999 99% of 29 year olds had driver's licenses. Today that number is plummeted to just 65% and it's dropping every single year. And that's something that's reflected across almost every age demographic and community around this city. Is there a reason? What is the reason? People want to get around in other ways than boning and driving a car or the other thing that we've come to realize I think which Mina had a lot of influence in is our our zoning and planning policy. So now we're not building suburbs that are way out in the middle of nowhere. So now people can live and work in the same place and it's cheaper and it saves time so it makes a lot more sense. So we're on this pathway already that's changing the way that we commute but you layer on top of that now the EVs that are on the road and the pricing differences that creates for consumers who can now have multiple options for how to get around as well as you have rail and other public transportation options coming online and the biggest thing of course is once autonomous vehicles truly arrive and I mean there are autonomous cars driving around on streets and cities around the country right now but within the next five to ten years as all the latest Booz Allen and PricewaterhouseCoopers and all these big firms are looking at as well as the auto manufacturers there may come a point where it's cheaper not to even own a car but to subscribe to a service like an Uber service where you can just call up a car that's driving out there on the road and it'll take you around. It's inherent in it don't you think because everything is automated you know the whole thing is one big computer and so you try out your cell phone push a button and the thing arrives two minutes later see that's better than owning one it's a combination of Uber and next chapter Uber. If you think about it I mean everybody who owns cars today they probably spent 95 percent of their time sitting idle doing nothing in your garage or your garage at work and so now if you have an opportunity with an autonomous car to be dropped off by your car and then rent it out on an online platform where someone else can get a trip from the airport to home throughout the day it becomes much more efficient so the number of vehicles on the road that you would need to service a population of our size so dramatically drops. So I guess the larger question is that you know this is sort of similar to electricity policy you know there's this whole big transformation on how we live work and do business and and so the next area is transportation and all the disruption that's happening in transportation. So how do we set the platforms necessary to move forward so how do we is there a way to break this down into manageable bite-sized pieces where we can develop a policy and build a consensus to move in a certain direction and then this sorry then the second question is do you think the reorganization of the house um lends itself to take on these kind of one at a time. Big issues. You know Kristen's really good at this he can frame his thoughts and then I won't have to interrupt him with questions. I want to add something to that mix. All right well that is well on. What about the resolution the more rather the the target bill that that failed in this session is that useful I mean shall we assume that it will pass next year and is there something else we should do in addition to that to move this ahead. Sure so um uh you guys need a little scored board that like pops up right over here in the in the feed right so you can click these things off but when it comes to both the long-term planning and this like kind of broad goal and then fitting in these individual pieces of what makes sense next and how do you proceed I think there's definitely an ideal way to do it and what has already been looked at in this working group between the department of transportation and the energy office there's about 37 or 38 individual sort of actionable items everything from looking at reducing transit times and distances in zoning all the way down to how do you get more people to take the bus or get on a bike or walk and then provide incentives for example for people to switch over to an electric vehicle over the long term. These things clearly are in a priority list some things are way hard and really expensive others are really easy and kind of a no-brainer and cheap so we can definitely start with a few of those pieces and already get the ball rolling. When it comes to that broader goal and setting that I think there is value in doing so for sure you know one of the things that is happening right now especially in light of the administrative change in DC is that you have streams of funding that are now shifting federal funding that may no longer be coming in for energy projects for example which we just found out about in the administration's budget this week as well as now alternative means of financing coming from large corporations like Google and others who are investing in this play space but we are competing against other states California of course but more specifically against other jurisdictions and what we're seeing when it comes to EVs and their infrastructure the all the charging infrastructure that's needed nobody really knows exactly what a built-out environment looks like what saturation looks like where you have workplace chargers and chargers and condos and all around so we are competing against other folks for a lot of these resources to put this stuff in and people are I don't say they're giving away money but they're looking for opportunities to invest Hawaii is perfect Oahu in particular where it's dense it's small we have the kind of environment that that this stuff really fits into so if we can demonstrate that we have the political will to not only set a long-term goal but to make sure that we're going to take steps to get there and commit to that I think there's a lot of support that could come to bear and we've been talking with specific vendors and companies in the Bay Area and LA Nevada and other places Tesla and others who are looking to partner and make these investments in Hawaii and that's one of the reasons why I think 1580 setting that goal and doubling down on our commitment to say yes we want to get there we don't know exactly how but we're going to do everything we can and for all the folks in the private sector looking to invest both locally and elsewhere you know we will politically help you and get out of your way when we need to I think that's the value in the bill itself and the last thing I'll say on that is you know when we passed 100% rps and I think even the rps and Mina's credited for creating our rps yeah you're in the state but I wanted a floor but also the thing that changed I mean and even the utility lobbied against it up until the minute it passed as well as some of the fossil fuel stakeholders but the minute it did I mean everybody got on board and said you know what we have this goal we're all committed and the amount of progress that we've seen since then and the amount of investment that's being made and the kinds of things that are happening it was night and day between prior and after the passage of that I think in the same way what we're hoping to do in a much larger national conversation is say look Hawaii is here alongside California others who are already going this route and we're committing to this future we are a place to invest we're open for business and the best part about this is the faster we can roll out electric charging infrastructure the faster ultimately we'll be able to empower people to hopefully save on their commutes to save on cost for transportation and ultimately stabilize our energy grid and help balance everything going on because this is a whole new world of opportunity for everybody and it's a whole new world for a break it's a perfect time to take a break down one minute break that's Chris Lee and Meena Morita would be right back for more on the same subject so what we need to well are you in inherent in your answer with something about seeing into the future and figuring out what it's going to look like later and then working to that do we know what it's going to look like I mean there's variables there's a change but different people have different ideas but no one I think has the yeah for example you could build a thousand charging stations but if the uber automated car comes true you don't need them maybe I mean I think there's there's several issues here one is you know the consumers preference in what they're buying you know and so you know we all know people buy trucks here a lot of trucks here so meeting that consumer preference and and then um but with the acknowledgement that you know you have people that just don't want to own cars three okay we're back with Chris Lee and Meena Morita we're talking about transportation energy in Hawaii and um you know we're talking about like making it clear that we have the political will to attract investment to attract laboratory situations from companies that can come here and use Hawaii as a transportation energy platform and laboratory um but you know you're talking in the break you know about what what it should look like what it will look like it's hard to know what it'll look like because all the parts are moving including this automated car thing which could change things dramatically how do you how do you find out how do you deal with that how do you determine you know what kind of incentives you want to build you're talking you know Meena was talking during the break about the public and the market the market should be I know you're a market person she's a market person I don't look like it but yeah she wants the market to you know to determine what we need yeah but you know sometimes you need a benevolent dictator person to use the expression of benevolent dictator legislature if you will who says you know we see it we understand it and we are going we're going there and we're not only gonna we're not gonna just accept what people want in the marketplace we're gonna incentivize them we're gonna shape the market we're gonna tune because we know that if you have too many cars it's no good if you use too much fossil fuel it's no good and so forth we're gonna try to save the state by incentivizing people to do the right thing whatever they really want so Meena was making a good point about uh you want you don't mention that real quick uh the trucks and yeah so it appears that the preference in Hawaii is small trucks or sometimes big really big trucks and and so you know it's it's it's not like the electricity market where you have the utility that's being regulated and that's responsible for meeting their renewable portfolio standards uh gold mandates so in the transportation sector when you're looking at this whole change out of vehicles first of all you still have a lot of old cars on the road then you have the consumer making these purchases so with that kind of um dependency on the market how do these changes take place yeah you know i think um one of the things that we looked at in this was do you do something prescriptive or do you figure out how you can really push the market along and i think nowhere in the um the discussion that we had this year was anybody trying to force anybody to give up their their favorite truck or or whatnot i drive a gas guzzler too and you know full disclosure but um but the idea is how do you put the infrastructure in place to allow that consumer choice because right now for example i would drive an ev except i have nowhere to plug a car in it's just not possible a street park and so i think like a lot of people who live in condos and everything else they're looking for the same thing and so how do we create this critical mass of ev infrastructure um out there i think that's really the goal of aligning everybody toward this long-term um this long-term target i think one of the things that we hope out of this um you know we don't know what the next toyota light truck is going to look like but we do know that the company is committed by 2040 to sell only electric vehicles and we're seeing already both with tesla's new heavy-duty trucks and as well as some of the hydrogen fuel cell vehicles out there eventually these these vehicles and all variations at big suvs and whatnot will all be there so we need to make sure that we're ready so that when people want to buy them they can so the other critical issue here is taxation policies because you know as you move towards electric vehicles um and we're so highly reliant on on gasoline taxes you know for for the maintenance of our roads and and uh matching federal dollars yeah um how do we go about this and and again i go back to the question is you know with with the house reorganization you know are we being set up correctly uh in committee structure um to to move these rail again not only i don't know of any way to describe it issues forward because i think you know on the electricity sector that's where we see some of the slowness playing out and getting um rate design correct you know to to move forward make it equitable and i i see this big um hurdle on the transportation side because we're so reliant on gasoline taxes yeah you know um the house reorganized reorganized uh at the end of the last day of session we have a new speaker of the house Scott Seiki um everything else is a little bit in flux at the moment but we'll have a committee lineup i think over the summer sometime but that being said the biggest difference between the house and senate the senate has one committee that handles both energy and transportation um and those two really i mean go uh hand in hand and and you cannot address one without the other i think at this point it's fair to say in the house we have two committees one that addresses transportation one that addresses energy so we'll need to get together the current chair of the transportation committee is Henry Aquino who's been working on that for a couple of years maybe four years or maybe even longer but we've worked well together and i think the conversations we're going to have to have we'll have to address these things of equity and how do you in a world of proliferating EVs um and no gas taxes paid by those drivers pay for public infrastructure like roads and highways so we have a number of bills that were proposed this year some that moved along which would tax vehicles by weight for example we have another proposal that would do just a blanket lump sum to the department of transportation to pay for roads every year and not even get into the metrics of who's paying from what type of vehicle or all that in the long term the other unknown x factor of course in all this is how much of that infrastructure will we still need if you have fewer vehicles on the road in a much more efficient place do you still need seven lanes wide highways so all this stuff is hanging out there so so in your recent travels have you seen any technology that can help address the taxation issues you know um or again actually there's a number of states obviously looking at this because it's a problem everywhere but or again just implemented a vehicle miles traveled pilot program so the farther you drive the more you help pay for the roads um EVs because they're they're electric and you can communicate much more easily now in some places are being designed um with pilot projects in mind that basically do the same thing based on your usage and in some cases uber and other companies that are these ride-sharing companies that are the networks of vehicles out there have been tasked to contribute in their own way so that every ride they give a portion of that goes to pay for whatever fund so some of these things are out there and i don't think anybody's nailed it yet but i think the one thing that's for sure is that we'll have to come to an answer soon because ultimately we need our roads and people are going to continue to buy EVs we've got 30 percent more sold this past year than the year before and that's when you give those kinds of rebates and stuff of course very few electric vehicles on the highways overall yeah overall and you know the the low-hanging fruit of the people who are excited about the new technology they already bought so now it's harder to sell this idea and i think it's not moving as fast as i would like to see so query you know you can incentivize or you can de-incentivize you could say as they have in other places maybe outside the country you want to buy a gas car we're going to tax you really heavily and we're going to try to discourage you from buying the gas car that works for sure and the person with the big truck you know who doesn't need the big truck the gas gobbler big truck he's going to be discouraged if you add a big tax on that of course it's the other kind of incentive you know where you offer a tax credit which we used to do but we're not doing any more for electric vehicles so is there anything on the on the drawing board for either of those possibilities to actually shape this market that Mina would like to leave as free and unhampered well i don't think there's been a discussion at least a serious discussion that i'm aware of on you know additional taxes for people just because they drive a fossil fuel car but the incentive question has come up a number of times and of course we don't have state money going into an incentive program right now but there is federal money that's been available for some time which is slowly going away but the other thing that we're starting to see is by 2026 the inflection point for the cost of an EV versus a traditional gas vehicle is going to flip that's the year supposedly in which it becomes cheaper to drive an EV and buy an EV up front than it is to buy a gas vehicle and that's been shifting closer and closer not only because we're getting closer to that year but because the technology is evolving faster than anybody has ever imagined and the cost of batteries and the equipment is coming down so it may be a question in the next two or three years as to what point assuming that this is going to happen and EVs are going to be cheaper across the board both up front and in operational costs at what point do we even need incentives maybe not to begin with maybe you're right so in your recent travels again have you seen any again more increased efficiencies in cars getting higher gas mileage in vehicles I mean has it stopped or is the trend still increased mileage the trend is still increased mileage for sure and of course you know electric vehicles are topping that list but even amongst gas cars and light duty vehicles you see continual gains now with the Trump administration looking at undoing some of those standards that that produce that we don't really know what's going to happen but I think it's safe to say that with manufacturers ranging from BMW and Toyota Hyundai of course Tesla and Nissan everybody else already moving in the direction of full electric vehicles or fuel cell vehicles I think it's only a matter of time and we may just be having this discussion which may be moot in a couple years anyway let me offer this thought I mean we could have a hundred percent electric cars not a certain point but if they're all being driven by oil you know in the generation system of the electricity that charges the batteries in the cars we haven't really achieved anything this is what's so exciting though because I think this is where there's most potential when you merge transportation and let's assume we get to a hundred percent EVs on this island if we were to do that overnight now you've got all these batteries driving around that can capture that load when it's let's say when power's cheapest at night and we're now charging our vehicles at night you stabilize the demand curve throughout the day and now it's cheaper for everybody to produce electricity theoretically if you can be more flexible in that power consumption and usage so there's a lot of possibility here how do you do that what kind of legislation do you pass in order to make that happen well I think the PUC yeah it's all I think it's all dependent on rate design yeah you know and and so basically it's like when you have your vehicle attached the utility would have the ability to draw power when it needs or to dump power when this is a better place you remember better place this is exactly the model that they were thinking of I'm in five six years ago so we're out of time you know so this is your opportunity to summarize what we learned from Chris Lee today and you know sort of tell the people what they can expect going forward well I think first of all thank you Chris for coming today or thanks for having me i'm sorry representative Lee for coming today and we really appreciate you having here and it sounds like you've got a lot of work cut out for you we all do in preparing for the next session and and so i'm looking forward to that thanks for having me thank you Chris been great to have you we'll do it again we'll do it again all right thanks yeah thanks that was good yeah they are connected aren't they well that makes them hopefully very sexy yeah if they're connected i mean you're gonna do both at the same time so well you know that part of part of it is again this is where i feel eco has a lot of shortcomings it's all the analytics you know so the ability to process data quickly and make tiny decisions yeah and and yeah I mean