RELATING TO RENEWABLE ENERGY.

SB3163

THE SENATE

S.B. NO.

3163

THIRTY-THIRD LEGISLATURE, 2026

STATE OF HAWAII

A BILL FOR AN ACT

relating
to renewable energy
.

BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF HAWAII:

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SECTION 1.
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The legislature finds that Hawaii is ranked
as one of the highest in the United States for solar power generation per
capita.
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In addition to importing
electricity generated by customers to the grid, Hawaii can create a more
comprehensive and long-term solution that solves the problem of excess
electricity generation during daylight hours.
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Solar power will be key to achieving the State's goal of generating one
hundred per cent of the State's electricity from renewable energy sources by
2045.
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Excess renewable energy is already
a significant problem that often leads to curtailment or other policies that
limit the development and utilization of solar and wind power, both of which
are variable sources of power.

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The
legislature also finds that energy storage is one solution to the problem of excess
electricity generation during daylight hours.
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However, energy storage is often expensive and limited in capacity.
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An alternative option is to sell excess
electricity to consumers such as computer companies or agricultural growers
during daylight hours at the net cost to the electric utility.
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The sale of excess electricity from the grid
to consumers at net cost is known as "smart imports".

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The
legislature further finds that smart imports can reduce electricity rates and
effectively use the abundance of solar power during daylight hours.
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This can help more Hawaii residents and
businesses transition to using electric vehicles through low or no-cost
charging during daylight.
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Smart imports
can significantly boost the renewable energy, battery storage, and electric
vehicle industries.

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The
legislature further finds that enabling flexible electricity consumption during
periods of excess renewable energy generation enhances grid stability, reduces
curtailment, and provides economic benefits to consumers who can shift energy
use to align with renewable energy generation patterns.
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Priority applications for smart imports
include electric vehicle charging, thermal energy storage systems, water
heating, agricultural irrigation and processing, and other loads that can
flexibly adjust consumption timing.

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Accordingly,
the purpose of this Act is to:

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(1)
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Establish
a smart imports program to require electric utilities to offer excess
electricity during daylight hours to consumers at cost to help create a more
sustainable Hawaii; and

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(2)
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Require
the public utilities commission to initiate a proceeding to propose
implementation of the program by January 1, 2028.

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SECTION
2.
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Chapter 269, Hawaii Revised Statutes,
is amended by adding a new section to part VI to be appropriately designated
and to read as follows:

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"
�269-
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Smart imports program; renewable energy;
excess electricity.
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(a)
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Beginning January 1, 2028, there is established the smart imports
program, which shall require electric utilities to offer excess electricity at
cost to consumers during daylight hours to be used for any legal purpose.

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(b)
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The public utilities
commission shall establish by rule:

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(1)
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Time periods during which excess
electricity is available, based on analysis of renewable energy generation
patterns and grid load;

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(2)
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The methodology for calculating and
verifying "at cost" pricing, including:

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(A)
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A t
ransparent cost
calculation formula;

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(B)
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Independent verification procedures;
and

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(C)
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Public disclosure requirements;

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(3)
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Eligible customer classes and use
cases, including but not limited to:

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(A)
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Electric vehicle charging stations and
networks;

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(B)
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Water heating systems, including thermal
energy storage;

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(C)
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Agricultural irrigation and
processing operations;

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(D)
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Commercial refrigeration and cold
storage;

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(E)
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Data processing and computing
facilities; and

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(F)
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Other flexible loads capable of
shifting consumption to periods of excess renewable energy generation;

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(4)
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Real-time price signal requirements
enabling consumers to respond to excess electricity availability;

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(5)
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Utility reporting and compliance
requirements, including:

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(A)
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Quarterly reports on excess electricity
periods and pricing;

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(B)
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Program participation rates and customer
enrollment;

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(C)
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Quantity of excess electricity sold
under the smart imports program; and

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(D)
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The impact on grid operations and
renewable energy curtailment; and

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(6)
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Consumer protection measures ensuring fair
treatment and preventing gaming of cost calculations.

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(c)
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The public utilities commission may impose penalties on electric
utilities that:

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(1)
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Fail to offer excess electricity at
cost as required by this section;

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(2)
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Manipulate or misrepresent cost
calculations;

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(3)
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Fail to provide real-time pricing
signals;

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(4)
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Fail to submit required reports; or

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(5)
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Otherwise fail to comply with rules
adopted under subsection (b); provided that any penalty imposed under this
subsection shall be sufficient to ensure compliance and may include fines,
remedial actions, or other appropriate measures.

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(d)
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Electric utilities shall prioritize smart
imports program enrollment for:

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(1)
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Public electric vehicle charging
infrastructure;

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(2)
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Agricultural operations supporting
local food production;

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(3)
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Affordable housing developments;

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(4)
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Small businesses and local
manufacturers; and

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(5)
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Facilities providing essential
community services.

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(e)
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The public utilities commission shall ensure
the smart imports program complements and integrates with other demand response
programs, time-of-use rates, and grid services programs offered by electric
utilities.
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(f)
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For the purposes of this
section:

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"At cost" means the net cost to the electric utility of
electricity, which may be zero or less than zero.

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"Excess electricity" means electricity generated from renewable
energy sources that exceeds current grid load and would otherwise be curtailed
or exported at negative value.

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"Flexible load" means electricity consumption that can be
shifted in time or adjusted in response to grid conditions and pricing signals
without significantly impacting the consumer's operations or comfort.

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"Smart imports" means the sale of excess electricity from
electric utilities to consumers.
"

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SECTION
3.
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(a)
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The public
utilities commission shall initiate
a proceeding to study other states' smart imports programs, renewable energy,
energy storage, and related solutions to excess electricity generation and
propose a "smart imports program" in Hawaii to be implemented no
later than January 1, 2028.
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The
proceeding shall include:

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(1)
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Analysis
of smart imports or time-of-use programs in Arizona, California, Texas, and
other jurisdictions with high renewable energy penetration;

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(2)
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Evaluation
of technologies and systems enabling real-time price responses;

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(3)
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Assessment
of potential impacts on electric vehicle adoption and charging infrastructure
development;

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(4)
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Analysis
of opportunities for agricultural sector participation;

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(5)
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Examination
of consumer protection frameworks ensuring fair and transparent pricing;

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(6)
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Evaluation
of methods to integrate smart imports with battery storage deployment and grid
modernization initiatives;

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(7)
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Stakeholder
engagement with consumer advocates, environmental organizations, businesses,
agricultural groups, and technology providers; and

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(8)
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Development
of implementation timeline and milestones for the January 1, 2028, program
launch.

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(b)
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The
public utilities commission shall submit a report of its findings and
recommendations, including any proposed legislation, to the legislature no
later than twenty days prior to the convening of the regular session of 2027.
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The report shall include:

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(1)
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Detailed
program design recommendations;

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(2)
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Proposed
cost calculation methodologies;

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(3)
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Recommended
eligible customer classes and use cases;

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(4)
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Analysis
of expected program participation and benefits;

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(5)
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Projected
impacts on renewable energy curtailment and grid operations;

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(6)
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Consumer
education and outreach strategy; and

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(7)
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Draft
rules for program implementation.

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SECTION
4.
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New statutory material is
underscored.

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SECTION
5.
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This Act shall take effect upon its
approval.

INTRODUCED BY:

_____________________________

Report Title:

PUC; Electric
Utilities; Smart Imports Program; Excess Electricity; Renewable Energy; Rules;
Study

Description:

Requires
the Public Utilities Commission to conduct a proceeding to study and implement the
Smart Imports Program. Establishes the Smart Imports Program and requires
electric utilities to offer excess electricity to consumers during daylight
hours at cost for any legal purpose beginning January 1, 2028.
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Requires the Public Utilities Commission to adopt
rules and establish penalties.

The summary description
of legislation appearing on this page is for informational purposes only and is
not legislation or evidence of legislative intent.