House energy committee advances wide slate of energy, environment and waste bills; carbon-tax hearing deferred

The House Committee on Energy and Environmental Protection met Jan. 28 in Room 325 and on Zoom and moved dozens of energy and environmental measures forward while deferring a high-profile carbon‑pricing bill for later consideration.

The committee adopted the chair’s recommendation to pass with amendments a series of bills ranging from a leaf‑blower noise measure to a sustainable aviation fuel tax credit. Committee members and dozens of agencies, utilities, developers and nonprofit groups testified for, against or with comments on individual measures. The session included detailed exchanges about administrative timelines, technical standards, funding sources and possible unintended consequences.

The committee front‑loaded final recommendations and votes. Several items will proceed to further drafting or the committee report with new amendment language requested by testifiers, and two measures — the deposit beverage container changes and the statewide carbon fee — were deferred for additional work and decision making.

Why it matters: The bills the committee advanced touch core state policy levers — permitting and environmental review, utility oversight, incentives for renewable fuels and electrification of transportation, and municipal‑level reuse/recycling programs. Together, the measures shape how the state will implement clean‑energy and waste‑management goals set by law and how the costs and logistics are allocated among ratepayers, developers, retailers and producers.

What the committee did (high‑level)

- Advanced noise bill HB 470 (leaf blower sale limits) with technical amendments after hearing Department of Health support for the measure’s intent and questions about measurement and implementation. Department of Health’s Matthew Carano said, “The department of health supports the intent of the bill,” while offering written comments on decibel‑based restrictions.

- Advanced HB 742 directing the Hawaii Community Development Authority (HCDA) to complete programmatic environmental impact statements (EIS) for two transit‑oriented development districts. HCDA Executive Director Craig Nakamoto and HHFDC noted that work is already underway and funding appropriations were previously made for both projects (testimony cited $25,000,000 for one Kapālama infrastructure package and $35,000,000 for a West Oʻahu road/infrastructure package).

- Consolidated and advanced HB 340 into HB 243 (using HB 243 as the vehicle) to create a streamlined interconnection process and grid‑ready home rules, with amendments to clarify timelines and remove an initially proposed reliability surcharge. The committee adopted an extended deadline (date‑certain language) for some deliverables to October 1, 2026, responding to Attorney General and Public Utilities Commission (PUC) concerns about ambiguous “180‑day” deadlines.

- Advanced HB 243 (PV/EV ready requirements for new residential construction) with the committee noting amendments to include electric‑vehicle charging infrastructure per industry requests and to align PUC reporting and deadlines.

- Advanced HB 350 to add heat‑pump water heaters to the list of systems that can meet building‑permit requirements; testimony from manufacturers and energy agencies focused on ensuring comparable performance standards and variance processes remain intact.

- Advanced HB 346 to offer rebates for EV‑ready parking stalls in new affordable housing developments; the measure received broad support from energy and housing stakeholders who described it as an equity and climate measure.

- Advanced HB 366 to clarify contested‑case review and environmental assessment procedures for renewable projects, adopting edits suggested by the Office of Planning and Sustainable Development.

- Advanced HB 342 to establish a renewable gas tariff process with amendments to allow the PUC a clearer completeness check and to convert some provisions to session law language; the Division of Consumer Advocacy and the PUC had urged rate‑case treatment, while Hawaii Gas proposed a transactional accelerated path if no customer rates are increased.

- Deferred decision on HB 786, a package of deposit beverage container changes (including grants/reverse‑vending‑machine provisions) to allow the committee to work with retailers, the Department of Health and redemption centers on operational concerns.

- Advanced HB 750 to authorize a needs assessment for an Extended Producer Responsibility (EPR) program; the committee added stakeholder seats (manufacturer rep and composting industry) to the advisory council and requested funding language options tied to the deposit beverage container special fund.

- Advanced HB 339 with amendments to require an acquiring utility applicant to demonstrate it solicited competing bids (including non‑investor‑owned options) and to allow the PUC to consider workforce and other protections in merger/ acquisition reviews; IBEW proposed workforce protection language.

- Advanced HB 978 to add electric utilities to the state receivership statute with technical edits and a committee report note to address Hawaii Gas’ concerns about mixed regulated/unregulated corporate structures.

- Advanced HB 976, a refundable tax‑credit package for sustainable aviation fuel (SAF), with the committee adopting multiple amendments requested by testifiers and removing the bill’s proposed allowance for carbon offsets from lifecycle calculations. The measure drew both strong industry support (airlines, refineries, farmers) and safety/health/environmental objections about certain feedstocks and lifecycle claims.

Deferred: HB 760 (state carbon fee/cashback). The committee held a separate joint hearing with Agriculture & Food Systems on HB 760 and shortly afterward deferred decision making to a later session (the committee asked staff to return with more briefing and financial modeling). Proponents argued a cashback design reduces regressivity; opponents warned of cost‑of‑living impacts and urged alternative measures and infrastructure investments.

Votes at a glance (committee decisions taken Jan. 28)

- HB 470 (noise — leaf blowers): Pass with amendments (committee adopted chair’s recommendation). Outcome: approved. - HB 742 (HCDA programmatic EIS for Kapālama and West Oʻahu TOD): Pass with amendments. Outcome: approved. - HB 243 (PV/EV‑ready new residential construction; vehicle for HB 340 material on grid‑ready interconnection): Pass with amendments (PUC, AG, industry‑requested amendments adopted). Outcome: approved. - HB 350 (heat‑pump water heaters added to permitted systems): Pass with amendments. Outcome: approved. - HB 346 (EV‑ready parking rebate for affordable housing): Pass with amendments. Outcome: approved. - HB 366 (contested cases and environmental assessments for renewable projects): Pass with amendments. Outcome: approved. - HB 342 (renewable gas tariff process): Pass with amendments. Outcome: approved. - HB 786 (deposit beverage container changes, RVM/grants): Decision deferred to Jan. 30; committee asked for retailer and DOH follow‑up. Outcome: deferred. - HB 750 (EPR needs assessment): Pass with amendments (advisory‑council membership expanded; committee requested funding language options). Outcome: approved. - HB 339 (utility acquisition/merger conditions): Pass with amendments (applicant must demonstrate solicitation of competing bids; workforce protections discussed). Outcome: approved. - HB 978 (extend receivership statute to include electric utilities): Pass with amendments and committee report note to consider unregulated/regulated company structure concerns raised by Hawaii Gas. Outcome: approved. - HB 976 (tax credit for sustainable aviation fuel production/import): Pass with amendments; lifecycle offset allowance for carbon offsets was stricken per committee amendment; funding caps blanked for further negotiation. Outcome: approved. - HB 760 (carbon fee/cashback — joint EEP/Agriculture hearing): Testimony taken; decision deferred to Jan. 30 for further briefing. Outcome: deferred.

Select testimony highlights and technical points

- Noise (HB 470): Department of Health (Matthew Carano, administrator, Environmental Health Services Division) supported the bill’s intent to reduce unnecessary noise pollution but urged caution about relying solely on decibel‑based sale limits and recommended technical clarifications in written comments. Public testimony included proponents who framed noise as an environmental‑health nuisance and opponents concerned about implementation mechanics.

- TOD programmatic EIS (HB 742): HCDA (Craig Nakamoto) and HHFDC (Dean Minakami) described existing master‑planning and earlier EIS work; HCDA said the projects already had a legislative appropriation ($25 million for Kapālama upgrades and $35 million for West Oʻahu infrastructure) and urged amendments to align the bill with work in progress.

- Grid‑ready home interconnection & PUC role (HB 243 / HB 340): Hawaiian Electric supported the intent to increase distributed energy resources but opposed the bill’s prescriptive process language; the utility emphasized recent interconnection performance improvements under a PUC performance incentive mechanism. PUC and the Division of Consumer Advocacy called for more study and requested a date‑certain delivery rather than a relative “180‑day” deadline — the committee replaced the 180‑day language with an October 1, 2026 date in several sections.

- Water heating (HB 350): Manufacturers and Solar Ray (Will Giese) urged parity between heat‑pump water heaters and solar thermal systems by aligning minimum lifecycle performance requirements; the Hawaii State Energy Office noted the existing variance process for installations that cannot practicably meet solar‑thermal requirements.

- Deposit beverage container amendments (HB 786): Retail industry testimony (Hawaii Food Industry Association) warned that landlords and lease restrictions can prevent retailers from operating large‑scale in‑store redemption points; DOH described operational problems with past reverse‑vending‑machine programs (maintenance, limited capacity, barcode database updates). The committee asked for follow‑up conversations with retailers and DOH and deferred decision making.

- Renewable gas tariff (HB 342): The PUC and Consumer Advocate recommended addressing renewable gas prices and customer protections within a rate‑case process. Hawaii Gas supported the measure’s goals but asked for an accelerated filings process where no cross‑customer rate impact exists. The committee adopted language to allow the PUC a completeness determination and to set an initial 6‑month timeline after a completed application.

- Sustainable aviation fuel (HB 976): Strong support from refineries, local farmers (camelina growers) and airlines; opponents raised lifecycle and toxics concerns about certain feedstocks (construction and demolition waste, biomass) and urged stricter lifecycle greenhouse‑gas and feedstock safeguards; the committee accepted an amendment to remove carbon offsets from the bill’s lifecycle calculation.

- Carbon fee (HB 760): The joint hearing drew extensive public testimony, including university and nonprofit analyses. Supporters urged a cashback/dividend design to protect low‑income households and reduce emissions; opponents (retail, farmers, grassroots groups) warned of regressive price impacts and stressed the need for parallel investments in transit, charging infrastructure and equity protections. The committee deferred action to allow additional review and modeling.

What’s next

Most of the bills the committee passed with amendments will appear in the committee report and proceed to other steps of the legislative process; several require coordination language, funding allocations, or technical edits that the committee directed staff to draft. The committee scheduled the deferred deposit‑container and carbon‑fee items for follow‑up consideration on Jan. 30.

Ending note: The hearing combined technical statutory fixes, appropriations language and policy design choices. Several measures were advanced with explicit instructions to staff to add date‑certain deliverables, to blank or rework dollar figures for later negotiation, and to add stakeholder seats or reporting duties — all intended to reduce legal ambiguity and implementation risk as bills move forward.