Legislators amend undersea cable bill

State lawmakers Monday amended a bill that would create a framework for a proposed undersea power transmission cable, removing language that Gov. Neil Abercrombie said could have been misconstrued as giving communities the ability to "opt out" of the project.

Abercrombie, testifying before a joint House committee hearing, reiterated his position that the legislation (SB 2785) is a first step needed to proceed with the project that would link the electrical grid on Oahu with those on the neighbor islands. The bill lays out how the undersea cable would be financed and regulated without explicity authorizing the project itself.

Much of the opposition to the bill has come from community groups on Lanai and Molokai, which are against plans to build utility-scale wind projects on the islands and transmit the energy to Oahu via an undersea cable.

Abercrombie stated his strong support for the bill, except for one paragraph that read, "Nothing in this Act is intended to require the construction of an interisland cable from the islands of Molokai or Lanai to Oahu unless the communities affirmatively request an interisland cable."

The governor said the language went against his administration’s philosophy of addressing Hawaii’s energy future as a statewide effort.

"It is impossible for me to understand how that would be enforceable," Abercrombie said of the restriction. "It implies a kind of referendum approach to legislation, and we don’t have that in Hawaii for good reason."

He added, "If one extends the logic of this to any piece of legislation, I suppose you could start arguing that in almost every bill that passes, if somebody decides they really don’t want to participate in it, they could opt out of it."

The joint committee approved the bill after replacing the paragraph in question with the following: "Nothing in this Act is intended to require the construction of an interisland cable from any particular island."

The bill was heard and approved by the House Committee on Water, Land and Ocean Resources, and the House Committee on Energy and Environmental Protection.

Rep. Gil Riviere (R, Schofield-Kahuku) said he was concerned that approving even a framework for an undersea cable project before more details are known would be putting taxpayers at risk unnecessarily.

"I’m terribly concerned that this is more of a blank check," he said during an exchange with Abercrombie. "I think in light of the rail situation — with everybody concerned about the cost of rail now — I’m concerned that we’re setting ourselves up for another very, very expensive situation."

The bill does not include a cost estimate for the proposed undersea cable.

Rep. Cynthia Thielen (R, Kailua-Kaneohe) said she objected to a section of the bill that would allow Hawaiian Electric Co. to petition the Public Utilities Commission to recover from ratepayers costs that it incurs for improvements made on "on-island transmission infrastructure" even if the cable is not built.

"My concern is that under this bill Hawaiian Electic doesn’t have any corporate risk at all," she said. "I don’t know of a situation where we in the Legislature have said, ‘Don’t worry, your shareholders are going to be protected, and you’re not going to have to run any corporate risk.’"

However, PUC Commissioner Michael Champley responded that he did not belive HECO’s participation would be risk-free.

"The utility does not make risk-free investments. They have to make these investments and hold to a prudent cost level. If these costs are not prudent, then the commission may very well not authorize them," he said.