 Welcome back to think tech. I'm Jay Fidel and this is energy 808 the cutting edge and we're talking today with Nicole Lohan. She's state representative and she chairs the energy and environmental committee and she joins us by remote from her office in the state capital here in downtown Honolulu. Welcome to the show Nicole. Thank you. So we wanted to discuss today with you the the issues before your committee in this 2020 legislative session. And that includes of course energy and includes environment both really critically important. I hope everyone in the legislature agrees that both of those subjects are critically important. Yeah. Yeah, I would hope so as well. Okay, so can you tell me who's on your committee and then we'll go into the substantive bills that have been introduced into the hopper. Sure. My committee includes myself as care representative Tina Wildberger is vice chair. She's from Maui. We have a couple other members from the big Island representative Chris Todd and David Tarnit. And then we have rep Ryan Yamane. Karen Har and Cynthia Dilan from Oahu. But how is it? What is it like to be the chair of this committee? I mean, so, you know, these are important issues as we said. And you know, it's a great weight on your shoulders. How do you feel about that? How much weight is there? And how do you deal with it? I mean, I enjoy being the chair. These are issues that I'm passionate about. And then I've worked on for many years and, you know, being the chair, I feel like it really gives you the opportunity to, you know, work in more depth on these issues and be able to, you know, have a little more control over decision making and what moves forward, et cetera. So I'm enjoying it and it can be, it's a lot more work than just being a member of a committee, but it's very rewarding as well. Yeah, you're the shepherd guiding the flock, so to speak. And you spoke at the Hawaii Energy Policy Forum legislative briefing in January, and that was very good. I enjoyed your talk. And in fact, we made a movie of it and it's right now it's on YouTube and it's on the Hawaii Energy Policy Forum website. I don't know if you've seen it, but you look pretty good in that. I did not. I'll have to look for that. Please do. And thank you for doing that. In any event, let's talk about the issues because they're all important. And of course we know that some of them will pass and others will not. And you have a fair amount to say about that by having a hearing or not and about moving it ahead or not. So let's talk about energy first. What are your favorite bills? What should we discuss? What is in the hopper on energy? There is a lot in the hopper on energy. I would say that at this point in time kind of the overarching theme of the bills that we consider relating to energy and other environmental issues, a lot of it has to do with the climate change. And if we're talking about energy, it's usually about renewable energy and how we're going to move forward faster and how we're going to use less fossil fuel. So one of the bills we have this year is to fix the calculation of Hawaii's renewable portfolio standards to ensure that we are meaning 100% when we say 100% so that it would calculate that percentage based on generation rather than sales. And then kind of in conjunction with that, there's another bill that looks at establishing a renewable portfolio standard for the gas utility so that they're being treated similarly to the energy utility, electric utility. That leads me to ask you about the line between the PUC and the legislature. There's a line there somewhere and the legislature does some things in policy and of course the PUC is a regulator but it also defines policy maybe on a smaller scale. But where would you say the line is? What's reserved for the legislature? What's reserved for the PUC? I mean I think at the end of the day the policy makers are the legislature and the PUC is a policy maker insofar as we empower them to do that. So oftentimes when a bill is, when there's two sides to an issue and there's supporters and opponents of a bill like I'm thinking for example when we passed several years ago the Community Based Renewable Energy Bill, the original bills that were introduced were very specific and prescriptive but in order to get that passed, the compromise position I think was to make it more general and just request the PUC open a docket and have them be the policy makers because I feel like the stakeholders feel like that process gives them more time and more play as being part of that decision. And it is true that compared to the legislative timelines on some of these things that for certain issues the PUC is more able to give things more careful consideration and they do have a lot of expertise as well. But on the other hand sometimes the legislature needs to be the leader on pushing forward new things so I think that's where the boundaries fall. Yeah and I remember I think it was a couple of years ago when performance based regulation was the word of the day and let's see what happened. Both the legislature and the PUC both adopted in their case a docket and in your case a statute calling for an inquiry into performance based regulation. I mean calling for a change to performance based regulation. Right well I think the bill that was passed at the legislature required the PUC to open a docket and so that was the impetus for doing it. It was I think one and then the other not concurrent. Well I guess you talked to them did they come and testify? Do you pick up the phone and say hi? What is the connection? How do you compare notes with your regulator who really works for the legislature in so many ways? Yeah I mean they're available to discuss policy with us the same as other stakeholders. So yeah I mean I can call and ask questions or set up meetings just as I can with other stakeholders. Oh that's great that gives you the depth of all that expertise out there and there's plenty of it and as you say it does require a certain amount of expertise. Well let's go on to other. Yes but you know after my APR on the committee and second year's chair I feel like I've you know gotten gained a fair amount of expertise myself as well so it's not like we're just driving blind. Yes of course and it shows. So what other bills have you got in the hopper on energy and and let me add a footnote to say that energy and environment are intrinsically related because of the whole notion that energy affects climate change and environment. So one you know it's a perfect join to have them both in one committee but what else is specifically energy. I think two of the big topics of conversation similar to last session that we're still pushing on this session are energy efficiency number one and number two electric vehicles and although that's not as directly related to the energy side of the discussion I guess as the energy efficiency piece is certainly interrelated so a couple bills that we have that I'm excited about involve mandates that just apply to the state and so it's pushing the state to move forward with transitioning to electric vehicles and requiring that for state facilities like state office buildings and to the hospitals schools that are that they undertake energy efficiency measures and I think that you know it's important to validate this conversation about energy efficiency because that's a huge you know piece of how we're going to get 200% we have to continue to try to manage the demand side of things and can't just offset all our energy use with production. And so let's talk about electric vehicles and my recollection is that there are there are a million cars in the state and 10,000 of them are electric vehicles. We have certain incentives but it's you know it's this this whole idea has been in play for gosh, it must be 10 years and query are we moving fast enough for you and what does this bill do to make it faster. There are several other measures as well so there's also a bill that would establish an income tax credit like a really direct incentive financial incentive for the purchase of an electric vehicle. And there's a you know there's a bill I discussed that you know requires the transition of state fleets by 2045 and establishes kind of a soft school statewide 400% renewable transportation by 2045. Those are actually both just for light duty vehicles and then for medium and heavy duty vehicles like where it's feasible because the replacement for those at a cost effective level don't currently are currently necessarily readily available. And then you know last year we passed the bill that would provide a rebate for the installation of charging stations that we have a bill again in this year that was just appropriate additional funds to that because that was a relatively small amount we put in last year. I think that once everything gets rolling we'll probably go through it pretty quickly. There is a bill that allows the agencies to use the Dem financing to move forward on fleet transition and the infrastructure and that would be at no cost additional cost to the state so that's a really good measure. So yeah and I think there's other things potentially coming over from the Senate that I haven't had the chance to review yet so but like I said it just remains a large and important topic of discussion. We've done a lot regarding our electricity generation and renewable energy and you know reducing our use of fossil fuels but now the transportation sector remains the biggest user and you know ground transportation is the easiest place to start. Oh sure well and of course there's I don't remember the exact number but it's six billion dollars goes out of the state for oil. Right. So we'd rather keep it here somehow. So electric cars are only renewable if the source of the power is from a renewable source. And even if some people say well it's not really renewable source we're still using a fossil fuel for the source. Fact is that electric cars become more renewable as the utility becomes more renewable and that's happening. So it's certainly worthwhile doing that. But you know I just worry about the incentivization. I remember you know a few years ago you had a federal incentive a tax credit and you had a state tax credit. Right now we don't have we don't have a state tax credit as I understand it. So the question is which one of those bills that you mentioned is going to do a better job at you know the lesser cost to the taxpayers and which one of them is likely to succeed or could they all succeed. That's a good question. I can't I don't have a crystal ball so I think we'll have to see where the conversation goes. I think the things that cost money are always a bigger you know a bigger hike uphill because there's so much competition over over general funds. So you know that's a factor. I would just say to that about renew about electric vehicles being only as renewable as the grid is. It's true to a degree. But also for a lot of the early adopters because it's what makes the most financial sense if you're someone who already has TV on your rooftop and it makes a lot of sense to have an electric vehicle that can take advantage of that. And so I think that on that level I mean I guess I could vary if you had metering that you might not be incentivizing using that at the right time of day. For a lot of the programs I think that it is utilizing renewable energy and then as we move forward with the infrastructure I think that establishing type of use rates and looking at how to incentivize the charging during daylight hours is going to be an important piece. But I think that's very much on everybody's radar. Yeah for sure. And as I understand it it's still a more efficient use than like petroleum. Oh sure. Yeah. So even if it's coming from even if it's charging a battery on the off the grid that's not very renewable it's still more efficient use of that imported oil than turning it into gasoline. So where does hydrogen fit in all of this Nicole I mean we talked about hydrogen a long time. You know there was a lot of discussion about hydrogen at PGV on the big island. There was you know discussion about shipping hydrogen in these big containers. It's not that big but you know these tanks around around the state and using it to create energy you know wherever it was shipped to as a way to have essentially renewable fuel made available for both generation and also for cars. But I'm not clear on whether there's a tax credit or for that matter a tax credit under these bills you've been talking about for hydrogen cars which are at the end of the day they're also electric because they use the fuel cell. And so forth so where is that and is that being incentivized is there public attention on that issue. I mean I think if we get a tax credit that applied to electric vehicles because we did make at least for some of the definitions of electric vehicles that are in statute we tested last year so I think it does include would include hydrogen vehicles. The current bill that we're considering that's moved that's been moving forward does limit the total like it would apply to vehicles up to I think $50,000 in value so we're not going to give a tax credit to someone to buy $100,000 vehicle. But yeah for hydrogen I mean I think hydrogen is a great option we could should continue to figure out ways to incentivize it but the reality is that it's just not at a point where it's cost effective and similar for at least compared to electric vehicles. You know that as electric vehicles as they're not not meaning hydrogen vehicles it's just the cost of that is so much lower in the current market and then hydrogen similar to the grid is only as renewable as the energy that used to create it. So as far as there's excess energy available for things like geothermal or if there's curtailed energy that we could use to create hydrogen or source ways to capture gas from a landfill facility or something like that and then use that to make hydrogen which they're discussing on Big Island. I think that makes a lot of sense and I'm really really supportive of it. The idea that there's like parity when you compare EVs you know in the current point in time when you compare EVs like a leaf or a Tesla or whatever to a hydrogen vehicle and how feasible it is to for you know the mass public to adopt them on the mass scale it's just not at that point yet and it would be a lot more expensive to make that hydrogen. Are you doing incentives are there incentives for I think I heard that you mentioned something along these lines for for charging stations for example if I want to go out if I have a little lot and so on a main thoroughfare maybe it's even a gas station of the conventional sense and I want to include you know hydrogen or a charging station or whatever you know alternative fuels is there is there a statutory in center for me to do that. I think you mentioned that there might be something in the hopper on that what would it be. Yeah, so we actually passed a bill last year for rebate for EV charging stations which does not include a hydrogen. Dueling station but that got passed and you know went to we do see basically was in charge of that and contracted it through Hawaii Energy because they were already managing a smaller rebate program that had been funded by and so like Hawaii Energy's been several past releases in the past couple months so that program is actually up and running the rebate program that they funded and there are rebates available for upgrade or installation of new EV charging stations and that applies to basically publicly accessible area so we're not letting we're not giving a rebate to somebody who wants to put a charging station you know in their garage it's for workplaces and multi unit dwellings and I think potentially also for if there's a business that wants to invest in doing this to our fleet vehicle. It strikes me that the probably the most efficient way to distribute charging, you know electricity for charging electric vehicles is is in a sort of, you know, a lots of stations instead of lots of individual homeowners and condo where you're making one charging station for a very few people you'd rather distribute it where you have one charging station for many people and so I mean assuming that that's the case assuming that would be good policy then the idea would be to incentivize charging stations that serve many people all over town. I don't know if we've reached that yet but that's what we that's what we passed last year and what we're looking at adding additional funds to this year. Yeah, good. Good. Okay. Yeah. So one other point about and you know I think there is a need to kind of take a more step back and take a holistic look at what is our approach to the EV infrastructure. Yeah, question because it's been very kind of patchwork today. But as things start picking up and the momentum starts rolling on this transition then I think that we do need to have a bigger conversation about what is the state or regulatory role and just kind of ensuring that the infrastructure is in place and is functioning. But it's going to be different, you know, it will be different than gas stations because you know one we want to figure out a way that we're going to incentivize people to charge during daylight and peak hours of renewable production. And that's probably going to be a lot at workplaces in commercial areas and so you know it's a little bit different and the difference too is that you know gas stations are regulated in a different kind of way because they have this substance that's an environmental hazard. You have to build big underground tanks and all of that and the infrastructure is going to be for the time being at least it's less regulated in a certain way. So there's a lot of questions that surround it but have to be looked at. Well you mentioned that maybe it's only aspirational but the goal would be to go completely non-fossil fuel vehicles by 2045. I think you called it a soft target. What does that mean a soft target and how far can we go? There's a lot of fear in the industry and pushback if we try to make it something that has teeth or that can somehow be enforced. So I think the way that the bill is written and that bill number is House Bill 2699 you know establishes 100% clean ground transportation goal for light duty vehicles statewide so that includes public and private vehicles but then I think the language and the purpose causes the bill notes that there's an understanding that there's still questions about how this will be attainable and we're just trying to I guess allay fears that this is going to be draconian in some way but then I think it's important you have to start somewhere and I think establishing these goals is important and we've seen that in the past with what started as the you know Hawaii Clean Energy initiative and eventually became 100% renewable though. One more energy bill and then we've got to go to environment but I mean I know there are other things but one more that strikes my interest is the one about giving a tax credit for batteries which are built into an existing system rather than batteries that are wrapped into you know the creation of a brand new system say in a family residence and that bill has been my recollection is it's been kicking around legislation for a few years but it has not passed. Is it there again? Will it pass? What are the considerations and what is the appetite for it? I think that the tax credit generally is going to be under discussion whether we will add an additional amount to it to increase it. I think that the odds would be less than 50% in my mind just because there's a need to you know kind of tighten our belts on the budget a little bit at this point in time and that would be an additional tax credit that would mainly be generalized by people who already have a PV system and who are comfortable enough financially to look at then installing a battery array in addition to that. So it's not exactly a measure that would be directed at like lower and middle income individuals and helping them participate in this clean energy transition. And I think that our focus on you know we have tried to have increased focus in recent years in bringing equity discussion into all these considerations. Does that mean that you'd rather see batteries and you know improvement of the system on the system level on the utility level of the grid or on maybe a... Yeah, I'd rather see us develop programs that incentivize the batteries because we have you know viable programs for time of use and programs for demand response. And you know a more flexible grid that's going to interact with these systems and you know will have better use of all this distributed generation when we get there. So I think what's happening right now is all the new systems going in, almost all the new systems going in do incorporate some amount of storage. Yes, right. The same is true of utility scale projects that are coming online is that all the new contracts include the storage piece. And so the tax credit that people are currently claiming at the state level is applying to that whole system and so it's including the coverage for storage. So to do an additional tax credit would be increasing the tax credit which is already like our largest tax credit in the state. And it's already been under a lot of scrutiny over you know what should be the discussion about ramping it down or adding in a sunset date. And so I just think in my view the idea of that increasing it when most of the conversation has been about decreasing it seems like a challenge. We're just trying to make the case for me why it's important to maintain the tax credit at the individual level because I think we do need to continue to build out our rooftop solar and distributed generation resources. The interesting thing is that the utility scale level because renewable energy is now more than cost competitive with like any fossil fuel, any new fossil fuel that they actually probably don't need to continue that tax credit going forward. And like well it does kind of just a pass through for them like the actual companies who are proposing these projects. It doesn't matter to them whether they have the tax credit or not they just want to know for sure if they have it or not so that it's not a moving target. So I think that that could be a place where we could consider you know making changes. To hear you discuss these things it really strikes me as the whole conversation is so much more sophisticated than it was just only a few years ago. We've come such a long way in terms of drilling down on policy points and looking into the future it's really nice to hear you know this kind of conversation. Anyway Nicole can we move to environment just for a minute we only have a couple minutes left. But I want to open that by saying that environment and energy are linked at the hip. And the other point I want to make and see what you think about it is that right now in this administration, this administration in Washington is not doing a whole lot about environment. In fact they're pulling the wings out of the EPA. And I guess that means that some of the burden that the federal government might undertake these days has to fall on the states. You agree with that and if so what is happening about it. Yeah I mean absolutely and you know we've seen. We've had multiple bills where part of it is kind of preserving existing standards whether it's about environmental protection and regulation. You know the appliance efficiency bill that we passed last year preserved federal standards in you know in case they were to be repealed or rolled back while also establishing new state level standards. You know we have a bill this year that's looking at phasing out, regulating and phasing out and like regulating disposal of hydrofluorocarbons which are really potent greenhouse gases used as for refrigerant as a refrigerant. And so that's another thing where I think the federal government had been talking about doing something and then with the current administration that's not moving forward. And then there's really no discussion around pesticides. There was a prior focus issue that I think the EPA was ready to ban and then decided against that after the administration change. Yeah it goes all the way from things like that down to just discussing you know what chemicals can be allowed to be used in sunscreen for example. Well Nicole we're out of time but I want to say it just sounds like a great job to have maybe one of the most important jobs in the legislature to focus on this and these particular subjects and issues. And it strikes me that I could see how one could become very passionate or possibly the other way around. A person who is passionate about these issues would really enjoy participating in the changes that are underway. Thank you so much. I hope you can do this again Nicole. Sure. Yes. Thank you for asking me and I would just mention before I go that you know there are a lot of other topics we're considering climate adaptation measures, waste management, cesspools et cetera that we didn't get to today but hopefully we'll have a chance to do that in the future. Yes let's do that. There's so much more. We'll circle back in a few weeks and see what else is cooking and how it's doing. Thank you so much Nicole Bowen, a State Representative, Chair of the Energy and Environment Committee. Thank you so much.