[Senate Hearing 113-286]
[From the U.S. Government Publishing Office]


                                                        S. Hrg. 113-286
 
                  SUCCESSES AND CHALLENGES OF MEETING 
             SUSTAINABILITY GOALS IN HAWAII AND THE PACIFIC 

=======================================================================

                                HEARING

                               before the

                    SUBCOMMITTEE ON WATER AND POWER

                                 of the

                              COMMITTEE ON
                      ENERGY AND NATURAL RESOURCES
                          UNITED STATES SENATE

                    ONE HUNDRED THIRTEENTH CONGRESS

                             SECOND SESSION

                                   TO

EXAMINE THE SUCCESSES AND CHALLENGES OF MEETING SUSTAINABILITY GOALS IN 
HAWAII AND THE PACIFIC, INCLUDING OVERSIGHT OF EXISTING ACTIVITIES AND 
     FEDERA-ISLAND PARTNERSHIPS IN ENERGY, WATER, LAND USE, MARINE 
                      RESOURCES, AND OTHER SECTORS

                               __________

                      HONOLULU, HI, APRIL 16, 2014


                       Printed for the use of the
               Committee on Energy and Natural Resources

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               COMMITTEE ON ENERGY AND NATURAL RESOURCES

                   MARY L. LANDRIEU, Louisiana, Chair

RON WYDEN, Oregon                    LISA MURKOWSKI, Alaska
TIM JOHNSON, South Dakota            JOHN BARRASSO, Wyoming
MARIA CANTWELL, Washington           JAMES E. RISCH, Idaho
BERNARD SANDERS, Vermont             MIKE LEE, Utah
DEBBIE STABENOW, Michigan            DEAN HELLER, Nevada
MARK UDALL, Colorado                 JEFF FLAKE, Arizona
AL FRANKEN, Minnesota                TIM SCOTT, South Carolina
JOE MANCHIN, III, West Virginia      LAMAR ALEXANDER, Tennessee
BRIAN SCHATZ, Hawaii                 ROB PORTMAN, Ohio
MARTIN HEINRICH, New Mexico          JOHN HOEVEN, North Dakota
TAMMY BALDWIN, Wisconsin

                Elizabeth Leoty Craddock, Staff Director
                      Sam E. Fowler, Chief Counsel
              Karen K. Billups, Republican Staff Director
           Patrick J. McCormick III, Republican Chief Counsel
                                 ------                                

                    Subcommittee on Water and Power

                     BRIAN SCHATZ, Hawaii, Chairman

TIM JOHNSON, South Dakota            MIKE LEE, Utah, Ranking
MARIA CANTWELL, Washington           JOHN BARRASSO, Wyoming
BERNARD SANDERS, Vermont             JAMES E. RISCH, Idaho
DEBBIE STABENOW, Michigan            DEAN HELLER, Nevada
JOE MANCHIN, III, West Virginia      JEFF FLAKE, Arizona
AL FRANKEN, Minnesota                TIM SCOTT, South Carolina

   Mary L. Landrieu and Lisa Murkowski are Ex Officio Members of the 
                              Subcommittee




                            C O N T E N T S

                              ----------                              

                               STATEMENTS

                                                                   Page

Abercrombie, Hon. Neil, Governor, State of Hawaii, Honolulu, HI..     2
Jimenez, Julia Valentino, Roosevelt High School, Mililani, HI....    10
Lippert, Dawn, Director, Energy Excelerator, (a program of 
  PICHTR), Honolulu, HI..........................................    26
Meguro, Wendy, Assistant Professor, Sustainable Buildings and 
  Community Design, University of Hawaii, Manoa, School of 
  Architecture and Sea Grant College Program, Honolulu, HI.......    30
Morimoto, Julian Mangadlao, Roosevelt High School, Honolulu, HI..    13
Morita, Hermina M., Chair, Hawaii Public Utilities Commission, 
  Honolulu, HI...................................................    21
Pauley, Stephen, M., MD, President, Edwin W. Pauley Foundation, 
  Ketchum, ID....................................................    45
Rue, Harrison, Community Building and Tod Administrator, City and 
  County of Hololulu, Department of Planning and Permitting, 
  Honolulu, HI...................................................    33
Schatz, Hon. Brian, U.S. Senator From Hawaii.....................     1
Tam, William M., Deputy Director, Hawaii Commission on Water 
  Resource Management, Department of Land and Natural Resources 
  (DLNR), Honolulu, HI...........................................    37
Thiel, Jackie Kozak, Sustainability Coordinator, State of Hawaii, 
  Honolulu, HI...................................................     2


                  SUCCESSES AND CHALLENGES OF MEETING 
             SUSTAINABILITY GOALS IN HAWAII AND THE PACIFIC

                              ----------                              


                       WEDNESDAY, APRIL 16, 2014

                               U.S. Senate,
                   Subcommittee on Water and Power,
                 Committee on Energy and Natural Resources,
                                                      Honolulu, HI.
    The subcommittee met, pursuant to notice, at 1:10 p.m. at 
the East-West Center at the University of Hawaii, Manoa Campus, 
Honolulu, Hawaii, Hon. Brian Schatz, presiding.

   OPENING STATEMENT OF HON. BRIAN SCHATZ, U.S. SENATOR FROM 
                             HAWAII

    Senator Schatz. Good afternoon--the Subcommittee on Water 
and Power is holding a field hearing here in Honolulu. We're 
pleased to have all of you.
    We are here today to examine the successes and challenges 
of meeting sustainability goals in Hawaii and the Pacific. 
Hawaii is a national leader in sustainability and we want to 
continue to encourage that strong tradition. We'll discuss 
existing Federal-Island partnerships in energy, water, land 
use, marine resources and other sectors as well as initiatives 
by local and State government.
    This weekend the United Nations International Panel on 
Climate Change released a stark report on the need for all 
countries to begin reducing carbon pollution immediately in 
order to avoid the most devastating impacts of climate change. 
Following its release Secretary of State, John Kerry, said this 
report makes very clear we face an issue of global willpower 
not capacity. Secretary Kerry is correct. We have the tools 
necessary to win this fight. What we need is the will, at all 
levels, to use them.
    Hawaii is one example that the statement is making 
progress. But it is also a place that will suffer if climate 
change continues unchecked. Hawaii's geographic isolation, 
limited physical resources, unique ecosystems and growing 
population create a unique set of challenges.
    We need reliable and affordable energy, water, agricultural 
land and other resources that are vital to a sustainable and 
growing economy. U.S. affiliated Pacific Island territories and 
freely associated States face similar challenges. Most islands 
currently manage or must prepare for projected water shortages, 
for urbanization and changing rainfall patterns, high energy 
costs due to heavy reliance on imported energy, increasing land 
use conflicts from loss of land due to sea level rise and 
growing populations and control of invasive species that made 
outside effects on fragile island ecosystems.
    To address these and other resource challenges, Hawaii has 
aggressively pursued a variety of policies to decrease reliance 
on imported energy, reduce overall energy use, more effectively 
use limited urban and suburban land and ensure future access to 
water for drinking, agricultural and other uses.
    Hawaii is highly dependent upon imported fuels for energy. 
In 2011 the State imported 93 percent of its energy. Like many 
relatively small islands, uses mostly fuel oil to generate 
electricity. As a result Hawaii has historically had the 
highest electricity prices of any State, sometimes reaching 4 
times the national average.
    In order to reduce energy costs and encourage clean energy 
the State implemented a renewable energy goal of 40 percent by 
2030 along with a goal of reducing total energy demand by 30 
percent by 2030. We are also beginning to pursue strategies to 
reuse and recycle water and to use water more efficiently. 
Different islands in the State confront different challenges 
and opportunities in meeting their energy, water and land use 
needs.
    The challenges are most acute on Oahu where over 70 percent 
of our State's 1.4 million residents live. So we must 
simultaneously pursue different energy and resource 
conservation strategies. Hawaii's water supplies as well as 
many other Pacific Island supplies are highly dependent upon 
rainfall and are threatened by increased hotter and drier 
weather, the loss of watershed forests and encroachment by 
rising sea level.
    Nearly 50 percent of Hawaii's water supply comes from 
ground water sources and the rest come in from the 
approximately 376 streams that flow throughout the year. Ground 
water, which is also used for agricultural, industrial and 
domestic purposes is the principle source of municipal water 
supplies in Hawaii. All of these characteristics of our State 
and other island communities mean that we have to be especially 
careful stewards of our precious resources. Decisions we make 
today, especially as we face a changing climate and all that 
comes with it, will have a major impact on our future.
    The goal of this hearing is to understand more deeply the 
challenges that Hawaii and other Pacific Islands face, 
highlight our successes, identify future opportunities and 
understand how the State can work more closely with the Federal 
Government to advance its goals.
    We have 2 panels today.
    Our first witness is Governor Neil Abercrombie. Governor 
Abercrombie will be followed by Mr. Julian Morimoto from 
Roosevelt High School and Ms. Julia Valentino Jimenez from 
Mililani.
    Thank you all for being here and welcome.
    Governor Abercrombie.

STATEMENT OF HON. NEIL ABERCROMBIE, GOVERNOR, STATE OF HAWAII, 
HONOLULU, HI; ACCOMPANIED BY JACKIE KOZAK THIEL, SUSTAINABILITY 
                          COORDINATOR

    Mr. Abercrombie. Thank you.
    Senator Schatz. Thank you for being here. Let's start with 
you and move down the line.
    Mr. Abercrombie. Thank you very much.
    Senator Schatz. I'm told to tell you to take 5 minutes for 
your testimony, but I'm pretty sure that staff will understand.
    [Laughter.]
    Mr. Abercrombie. Thank you very much, Senator. It is a 
pleasure for me to be here with these 2 fine, young people, who 
are 3 dimensional embodiment of the future that you referred 
to.
    I have a copy of the letter that you sent me to me where it 
says, very specifically, please limit oral summation of your 
written testimony to 5 minutes. So you did, I move. Everybody 
knows that I was coming prepared.
    [Laughter.]
    Mr. Abercrombie. So I thank you very much for that 
opportunity. A point of fact, I would like to submit for the 
record, with your permission, formal testimony for the field 
hearing which I have before me and would like to summarize if I 
might.
    Senator Schatz. Yes, please.
    Mr. Abercrombie. For you.
    So that I would like to submit.
    I would like to submit as well for the record, with your 
kind permission, a packet of material which has been shared 
with the President's Task Force on Climate Change and 
Resiliency including the work of our sustainability 
coordinator, Jackie Kozak Thiel, entitled, Navigating Change, 
Hawaii's approach to adaptation.
    This was, in fact, a report for the first meeting of the 
State, Local and Tribal Leaders Task Force on climate 
preparedness and resilience in December of last year which 
we've been following up on. It includes our resolutions from 
the Hawaii Invasive Species Council which, I think, directly, 
again, addresses some of the points that you have raised. Our 
initiative here in the State on the rain follows the forest 
which is our Department of Land and Natural Resources approach 
to water conservation and preservation, if you will, in the 
midst of the global climate change and warming phenomenon.
    Again, with your permission, please?
    Senator Schatz. Yes.
    Mr. Abercrombie. Mr. Chairman.
    Senator Schatz. These will be a part of the record.
    Mr. Abercrombie. Thank you so much.
    In summary, I would like to in reference to the term, 
testimony, just refer you to page 2, if you have a copy of it 
there. Just with one little reference, if I might that speech 
to the particular necessities associated with being in the 
Asian Pacific region. As you know and as you are well aware of 
and as you've stated yourself on many occasions, we are Island 
People. We regard the Pacific Ocean as not separating us in the 
Asian Pacific region, but connecting us in the Asian Pacific 
region.
    If you'll go to the paragraph on climate change on page 2, 
you'll notice with, recognizing this, that islands are windows 
to the future. The State of Hawaii has become the first sub 
national government to sign onto the Majuro Declaration for 
Climate Leadership along with the U.S. and Pacific Island 
nations.
    I hope it doesn't seem presumptuous to other people that a 
State would sign into, sign onto, ask permission to sign onto a 
national treaty, in effect. The Declaration indicates that 
climate leadership is what is necessitated, particularly for 
island nations and for those nations that border the Asian 
Pacific region. Cite that because we do believe that Hawaii is 
a microcosm for global sustainability challenges and solutions.
    When I first ran for office, Senator, in 1974, when I first 
ran for the State legislature, I should say, for the seat which 
you subsequently occupy, I made water and its conservation the 
principle element of my campaign. At the time it was thought to 
be an odd focus, thought to be a little bit abstract for a 
local legislative contest, if you will. But I didn't think so. 
I thought we were vulnerable. I thought we were vulnerable on 
the energy side, the food side, the natural resource and 
affordability of all of these aspects.
    So going back then all the way to that time, to the 
present, this has been on the front line of concern for 
Hawaiians. Climate change and global warming has brought this 
to a higher degree of perception, publicly, I think, than ever 
before.
    So we see, our islands, as a test bed for innovation. We're 
very, very grateful for the opportunity that you sit on, on 
this very valuable committee, in terms of its potential benefit 
for and your opportunity to make genuine progress, not only for 
our islands, but for the nation.
    This enables us to have an integrated approach with that 
which the Federal Government is able to do for our Federal 
partnerships then are key. So we're committed to action on the 
Hawaii Clean Energy Initiative, on climate change and what we 
propose for the future which the testimony elaborates on at 
greater length than I have time for right now, our Aloha Plus 
Challenge for Sustainability.
    Back there in 1974 we called it carrying capacity. That's 
transformed itself, I guess, in nomenclature to sustainability. 
It comes to the same thing.
    Just let me elucidate a moment or 2 on those 3 elements, 
our Hawaii Clean Energy Initiative, of which you were a key 
element when you were Lieutenant Governor. 70 percent clean 
energy by 2030. The recognition of the oil import crosses of 
over 4, between $4 and $5 billion.
    We propose to be a national leader in energy efficiency. 
We're, right now, we're ahead of schedule to meet our renewable 
goals. Our Federal partnerships will help us with a smart grid 
and storage and transportation elements all associated with 
that.
    On climate change itself I've already mentioned that the 
President's Task Force on Climate Preparedness and Resilience. 
Again, I'm aided in this with the very able assistance of 
Jackie Thiel and the various departments of our State 
government that are committed to that.
    We thank you for your leadership in the Congress on this 
issue. I'm glad in the time that you've been there, you've been 
recognized for that, not only with your committee assignment, 
but with your chairmanship of the subcommittee.
    This is a priority issue, climate change for Hawaii, across 
the whole Pacific, as I indicated. We are hopeful that the 
recommendations that we will be forwarding to the President 
are--we know that they're the result of activities and action 
that we're taking here in Hawaii. We think it's applicable 
across the nation.
    So we're taking climate change seriously. We already are 
experiencing the impacts, that's for certain. So we want to 
share what we're able to learn and what we're able to do with 
everyone across the country.
    Finally, in this area, I mentioned this Aloha Plus 
Challenge. Without going into too much detail, that will be 
forthcoming in the days and weeks to come.
    Your conference yesterday was about making sustainability 
happen. So leaders have to make commitments to act together to 
put policies into place that provide direction and incentivize.
    So Hawaii was invited by the Global Island Partnership to 
make an international commitment to sustainability. We 
certainly accept that invitation. We're working with the mayors 
throughout the, the mayors and councils throughout the islands 
and the chair and members of the Office of Hawaiian Affairs to 
bring that about.
    The Aloha Plus Challenge will set targets for 2030. This 
goes beyond political. In other words, we're not trying to make 
this oriented toward a political timeframe, but rather the 
timeframe necessary for us to address these serious issues. The 
Aloha Plus Challenge will deal with clean energy, global food 
production, natural resource management and invasive species 
prevention, waste production, smart growth and climate 
resilience and green jobs creation and education. All, I think, 
clearly the heart of the subject matter of the conference 
yesterday and your hearing today.
    So we'll be announcing some details with regards to the 
Aloha Challenge, the Aloha Plus Challenge. We'll be working 
with the public and private sector to--for Hawaii's green 
growth. Of course, we're going to support the United State's 
Department of State in the upcoming United Nations Conference 
in Samoa on island sustainability.
    So, Mr. Chairman, we have in the written testimony some 
more specific recommendations, a few more general 
recommendations based on my summary.
    We can't build sustainable futures alone. We know that. We 
need private investment. We need private support. We need 
public support. We intend to try and bring that about.
    We're committed, I can assure you, to being a model for 
integrated sustainability. We invite the Nation and the world 
to learn with us, not necessarily from us, but with us. We want 
to join with everyone as a part of that commitment.
    I want to inform you that we're working very, very hard. 
Hope to have an answer, perhaps, within a month's time from the 
World Conservation Congress in 2016. It's never been held in 
the United States before. I think we're down to, perhaps, 2 
sites. We've had a very successful site visit from the team 
from the Conservation Congress. This is entirely compatible 
with the goals of this conference and this hearing.
    But we think that Hawaii has something unique to offer. I 
hope they conclude the same.
    Also, you had yesterday the advantage and the opportunity 
to hear from Nainoa Thompson. The Hokule'a World Wide Voyage, 
Mr. Chairman, I think summarizes what I have to say today. I 
think summarizes what the commitment of everyone here is all 
about. I hope gives a clear direction to the activities 
associated with the past 2 days.
    This is the message of Aloha. This is the message that our 
diversity in this world should define us rather than divide us 
as we say here. I am happy to be able to recite to those who 
wonder what the message of Hawaii is that the aloha spirit, in 
fact, unites us as the Pacific Ocean unites us as brothers and 
sisters. That this message is something that should be taken 
not just to our friends and neighbors on the mainland in the 
United States and throughout the United States, but it's one, I 
think, that can usefully be taken to the world.
    As part of the packet then, Mr. Chairman, I've included for 
the formal inclusion in the testimony I hope our Aloha law, the 
State law, HRS 5-7.5 which is in fact the Aloha spirit, the 
kindness, the unity, the realness, the pleasantness, the 
humility and the patience expressed with perseverance that 
represents aloha. I know that your activities here today are an 
expression of that. I thank you for the opportunity to be able 
to present this summary and to share with you, not only our 
State's priorities, but our aloha for you and all you're trying 
to accomplish.
    Senator Schatz. Thank you very much.
    Mr. Abercrombie. Mahalo, very much.
    [The prepared statement of Mr. Abercrombie follows:]

Prepared Statement of Hon. Neil Abercrombie, Governor, State of Hawaii, 
                              Honolulu, HI
    Aloha Chair Schatz and Subcommittee members. As the Governor of the 
State of Hawai`i, I thank you for the opportunity to testify about our 
State's sustainability goals and how existing and new partnerships with 
Congressional leaders and the Federal Government can strengthen our 
ambitious efforts.
    As isolated islands, Hawai`i is a microcosm of the sustainability 
challenges facing the planet. We import 80-90 percent of our food and 
energy, impacting our economy more than $8 billion each year. Hawai`i 
is the endangered species capital of the U.S, and we join other Pacific 
Islands on the frontlines of climate change. Despite our alarming 
vulnerability, Hawai`i has a distinct vantage point at the crossroads 
of the Asia-Pacific region and a unique opportunity to serve as a model 
for integrated, whole system solutions to these challenges. Our island 
perspective and indigenous host culture naturally leads to 
interconnected thinking and collaboration, and we are committed to 
developing nexus solutions for energy, water, waste, agriculture, 
natural resources, and community design.
    Today, I will highlight three major initiatives with strong 
statewide support that illustrate Hawai`i's achievements, aspirations, 
and commitment to action:

   Excellent early progress on the Hawai`i Clean Energy 
        Initiative;
   Our emerging national and international role in climate 
        change leadership; and
   The Aloha+ Challenge: our shared leadership commitment to 
        build a more resilient, sustainable and secure economy across 
        our islands with six ambitious sustainability targets for 2030.
Hawai`i Clean Energy Initiative
    As the most fossil fuel dependent state in the nation with $4.5 
billion in annual outlays from our historical addiction to oil, clean 
energy is a matter of security and resilience in Hawai`i. The Hawai`i 
Clean Energy Initiative, jointly led by the State of Hawai`i and the 
U.S. Department of Energy, is a perfect example of how federal 
partnerships have helped to advance our state goal of 70 percent clean 
energy by 2030 through 40 percent renewable energy and 30 percent 
energy efficiency. In 2013, my Administration announced our commitment 
to go beyond 40 percent renewable. The clean energy sector has set the 
pace in Hawai`i. I am proud to report that we are currently at 18 
percent renewable, beating our interim 2015 goal of 15 percent ahead of 
schedule. With the highest energy costs in the U.S., and as a national 
leader in energy efficiency and a pioneer in the frontier of renewable 
energy penetration into the grid, Hawai`i is uniquely positioned to 
serve as an international clean energy test bed and a model of Federal-
State and Federal-Island partnerships.
Climate Change
    Clean energy transformation is paramount for mitigating the impacts 
of climate change. I appreciate the Senate's leadership on climate 
change, including the Up all Night event in Washington D.C. organized 
by Hawai`i's Senator Schatz and others. I have been honored to share 
Hawai`i's perspectives as a member of President Obama's State, Local, 
and Tribal Leaders Task Force on Climate Preparedness and Resilience. 
At the first Task Force meeting, I presented a special report called 
Navigating Change-Hawai`i's Approach to Adaptation, which outlines our 
distinct challenges, solutions, and initial recommendations. Every 
region of our nation is represented on the Task Force, and I assure you 
that climate change is a priority issue for all of us. Governor Calvo 
of Guam and I have highlighted the special urgency of climate impacts 
on island communities and indigenous populations, including more severe 
storm events, less rainfall and fresh water, proliferation of invasive 
species, rising temperatures, ocean acidification, and sea level rise. 
Islands are windows into the future. With this recognition, the State 
of Hawai`i became the first sub-national government to sign onto the 
Majuro Declaration for Climate Leadership alongside the U.S. and 
Pacific Island nations.
    Task Force members are developing recommendations for the President 
to help strengthen Federal support for State, Local, and Tribal efforts 
in disaster management, community health and development, natural 
resources and agriculture, and built systems and infrastructure. 
Through our Resilient Hawai`i Forums & surveys, we engaged over 1,000 
citizens to identify diverse concerns and suggestions. The message is 
clear-the people of Hawai`i are taking climate change seriously and 
want to see action at every level of government. This is no longer 
about projections. We are already seeing the impacts in Hawai`i. 
Ranchers are struggling with drought. Our world-renowned beaches are 
disappearing due to erosion. Federal support is critical to help us 
understand, mitigate, and adapt to the impacts of climate change.
    Hawai`i's major recommendations to the Task Force encourage greater 
flexibility for adaptive, place-based responses. We also call for 
stronger, ongoing horizontal coordination across federal agencies and 
vertical coordination with State, Local, and Tribal governments to 
ensure cost-effective alignment of proactive efforts and integration of 
programs. Additionally, in order to make adaptation-planning decisions, 
Hawai`i and other islands need adequate spatial and temporal resolution 
for modeling climate projections. Like many islands and coastal states, 
much of Hawai`i's critical infrastructure is located along the coast. 
We will need federal assistance in identifying vulnerable assets and 
strategies for decentralization and relocation.
    Hawai`i is uniquely positioned to serve as a hub for coordinating 
domestic and international climate change efforts in the Asia-Pacific 
region. We recommend that the East-West Center be considered as a venue 
for an International Climate Change Resilience Forum. As home base to 
the U.S. Pacific Command, the State of Hawai`i also has the opportunity 
to build strong partnerships with the U.S. Department of Defense for 
building climate resilience in the region.
    As a Task Force member, I will produce a report of Hawai`i's full 
list of detailed recommendations and plan to share them with our 
Congressional delegation for consideration before the end of the year.
Aloha+ Challenge--He Nohona `Ae `Oia-A Culture of Sustainability
    The intent of this hearing is to examine successes and challenges 
of meeting sustainability goals. The State of Hawai`i has made 
sustainability a priority in our State Planning Act and incorporated an 
official definition, goals, and principles into law. Last year, I 
accepted the invitation from the Global Island Partnership to the State 
of Hawai`i to make an international commitment to sustainability in 
2014 and to share and learn with other islands. It has been a pleasure 
to work with our four Mayors and the Chair of the Office of Hawaiian 
Affairs to develop the Aloha+ Challenge, our shared leadership 
commitment to 2030 targets in clean energy, local food production, 
natural resource management, waste reduction, smart growth, climate 
resilience, green jobs creation, and education. This effort is 
supported by our State Legislature and a cross-section of public and 
private sector leaders in Hawai`i Green Growth. We plan to formally 
launch the Aloha+ Challenge in the next few months with a joint, 
statewide commitment to:

          1. Clean Energy--70 percent clean energy, including 40 
        percent from renewables and 30 percent from efficiency
          2. Local Food--Double the local food production with a goal 
        of 20-30 percent of food consumed being grown locally
          3. Natural Resource Management--Reverse the trend of natural 
        resource loss mauka to makai by increasing watershed 
        protection, community-based marine management, invasive species 
        prevention and control, and restoration of native species
          4. Waste Reduction--Reduce the solid waste stream prior to 
        disposal by 50 percent through source reduction, recycling, and 
        bioconversion
          5. Smart Sustainable Communities--Increase livability and 
        resilience in the built environment through planning and 
        implementation at the state and county levels
          6. Green Workforce--Increase local green jobs and education 
        to implement these targets

    Federal partnerships and support are crucial to progress on all six 
targets. I will highlight a few key successes, challenges, and 
opportunities for federal support of the Aloha+ Challenge targets.
Clean Energy
    To guide Hawai`i's clean energy revolution, my Administration 
established a statewide energy policy in 2013 with five key elements: 
(1) diversifying our energy portfolio; (2) connecting the islands 
through integrated, modernized grids; (3) balancing technological, 
economic, environmental, and cultural considerations; (4) leveraging 
our international status as a clean energy test bed; and (5) allowing 
the market to pick winners.
    We have a strong start on Hawai`i's clean energy transformation, 
but future gains will require even smarter solutions. Continued state 
and federal investments in analysis, planning, and infrastructure are 
required to catalyze the clean energy revolution. We greatly appreciate 
our successful MOU with the U.S. Department of Energy, which has 
provided vital support for Hawai`i to meet our 2030 statutory clean 
energy goals while reducing greenhouse gas emissions.
    Due to this success, Hawai`i is keenly focused on removing barriers 
for renewable energy penetration by interconnecting our Oahu and Maui 
grids and improving grid infrastructure at the energy consumer/
distribution and transmission levels. It is critical to ensure that 
dedicated funding is continued in order to commit resources to both 
short and long-term initiatives required to achieve Hawai`i's clean 
energy goals.
    Partnerships and assistance in the following areas will also help 
to support Hawai`i's clean energy target:

          1. Developing definitive, accurate renewable energy resource 
        assessments on each island that consider technical constraints, 
        costs, the environment, and community support and benefit.
          2. Building a clear set of scenarios based on the island-
        based renewable energy resource assessments.
          3. Working with utilities to develop methods to address 
        curtailment risk as renewable energy penetration forces 
        limitations at the substation, circuit and system level. This 
        would include pursuing specific paths towards grid 
        modernization, smart grid--advanced metering infrastructure; 
        storage; alternative fuels like natural gas; and submarine 
        transmission.
          4. Developing a transportation plan, starting with a design 
        charrette of local stakeholders to assess options for reducing 
        large volumes of petroleum-based gasoline, diesel, jet fuel and 
        marine fuels with a focus on policies and actions that can be 
        achieved in Hawai`i through a roadmap and supporting analyses 
        of costs, benefits, and sources of funding.
Local Food Production and Water
    Part of my New Day Plan is to spark an Agricultural Renaissance in 
Hawai`i. The Waimea Nui Agricultural Complex project, with a Veteran to 
Farmer program, is a great example of our creative Food Self-
Sufficiency Strategy in action. The complex will also include a 
biodigester that will create energy for a kitchen and processing 
facility where farmers can create value-added products to increase 
their revenue stream. This project would greatly benefit from 
additional support from USDA.
    As the emergency drought in California underscores, water and food 
security are vitally linked. Federal partnerships can help us in both 
increasing our efficiencies in agricultural irrigation practices and 
reclaiming storm water, grey water, and rainwater to replace potable 
water in urban and agricultural applications.
Invasive Species
    Invasive species are one of the top threats to Hawai`i's 
agriculture, natural resources, and human health. I have directed my 
departments to effectively work across silos through the interagency 
Hawai`i Invasive Species Council. We recently passed resolutions urging 
federal agencies to support Hawai`i's efforts to strengthen 
biosecurity. The resolutions are attached with opportunities for 
partnership with the U.S. Departments of Agriculture, Interior, and 
Defense.
    The State of Hawai`i would also like to be considered as one of the 
U.S. Department of Agriculture's pilot sites to create a harmonized 
national systems approach to nursery certification.
Natural Resource Management
    Healthy forests, wetlands, coral reefs, and other natural 
ecosystems are critical to sustainability and resilience in a changing 
climate. In 2011, my Administration unveiled a plan to replenish 
Hawai`i's source of water through the Rain Follows the Forest Watershed 
Initiative. In 2013, we updated our Ocean Resources Management Plan to 
identify management priorities and interagency implementation actions. 
We need healthy watersheds and reefs to continue to deliver fresh 
water, absorb greenhouse gases, control runoff and erosion, protect 
shorelines from storm surge, produce sustainable seafood, maintain our 
unique biodiversity, and provide other natural benefits that allow us 
to survive and thrive in the middle of the Pacific Ocean.
    Federal partnerships and support have been critical in matching our 
state investment in natural resource management, such as the U.S. Fish 
and Wildlife Service's Cooperative Endangered Species Recovery Fund and 
State Wildlife Grant program. A restoration of these funds (to FY2011 
and FY2014 levels respectively) would help Hawai`i to make progress on 
simultaneously protecting water supply, preserving biodiversity, and 
preparing for the impacts of climate change through ecosystem-based 
adaptation.
Waste Reduction
    Solid waste management is a unique challenge in Hawai`i because we 
are a geographically-isolated island state. Currently, we import the 
vast majority of goods used in the state, which in turn creates waste 
that requires management. Hawai`i has developed a variety of innovative 
waste management systems to address the state's solid waste issues, 
including development of H-Power (Honolulu Program of Waste Energy 
Recovery), the Deposit Beverage Container Program (HI-5), the Advance 
Disposal Fee Program for glass, and electronic waste recycling.
    In order to meet our 2030 target of reducing our solid waste stream 
by 50 percent, Hawai`i needs federal assistance to:

          1. Establish a market for recycled products
          2. Reduce the level of packaging in transported goods
          3. Establish standardized best practices for manufacturing 
        that will create less waste

    All these measures would be useful to other jurisdictions that are 
also working to reduce waste.
Smart Sustainable Communities
    Ninety percent of our state's population lives on this island. We 
need to make sure that our urban and rural communities are resilient, 
livable, and age-friendly. Transit-oriented development is a central 
component to sustainable community design and smart growth. Interagency 
programs like the HUD-DOT-EPA Sustainable Communities Partnership 
should be replicated and expanded to encourage innovation, 
collaboration, and performance monitoring at a state and local level. 
In order to better incentivize sustainable community design throughout 
the country, we need to better align transportation costs and usage. As 
the Federal Highway Trust Fund decreases from the reduction of vehicle 
miles travels (VMT) and increased fuel efficiency, we need to 
transition from a fixed cost system to a variable cost system that 
accounts for VMT. A VMT pricing system could be used in place of the 
existing gas tax system and help to pay for new resilient 
infrastructure. This approach would support performance measures for 
all modes of transportation and broader community goals that link land 
use, community design, health, safety, equity, and environmental 
sustainability.
    Education--Student participation on the witness panel today 
demonstrates the importance of empowering the next generation of 
leaders through education. We need to make sure that our children are 
obtaining the 21st century skills and multidisciplinary knowledge from 
pre-school through higher education. This is a key investment in the 
integrated sustainability solutions of the future.
    Green Jobs--As we strive toward all of these targets, we will 
create a diversified workforce through the economic and entrepreneurial 
opportunities presented by solving these challenges. Hawai`i is already 
one of the top states in the nation for clean energy job growth.
    Government cannot and should not build a sustainable future alone. 
Private sector investment, innovations, and partnerships are critical. 
Government's key role is to reduce risk, increase market reliability, 
and strategically leverage government funding to mobilize major private 
finance. The combination of clean energy policies in the Hawai`i Clean 
Energy Initiative and Hawai`i's Energy Excelerator is a powerful 
example of this approach. $10 million in federal funding leveraged over 
$55 million in private sector investment and resulted in over 400 green 
jobs. There are similar entrepreneurial opportunities in agriculture, 
natural resource management, waste reduction, and green building that 
would benefit from federal investment and incentives.
    Yesterday's Ascent Conference at the University of Hawai`i reflects 
the type of integrated thinking and public-private solutions that are 
needed to meet the sustainability challenges in Hawai`i and around the 
world. Hawai`i is ready to serve as a model of integrated and 
innovative approaches that can be scaled up for national and 
international benefit. We welcome others to learn with us.
    The Hokule`a, the traditional Hawaiian voyaging canoe, is embarking 
on the Worldwide Voyage to share Hawai`i's sustainability message 
around the globe and carry lessons learned from other ports and places 
with a focus on ocean connections. We are working closely with the U.S. 
Department of State to help represent our country at the upcoming 
United Nations Conference for Small Island Developing States focused on 
island sustainability in September 2014 in Samoa. In 2016, we hope to 
be the first U.S. location to host the World Conservation Congress, 
where we will showcase real progress on all our Aloha+ Challenge 
targets.
    My Administration is committed to leading sustainability efforts 
through interagency coordination, public-private partnerships, and 
strategic investments. The State of Hawai`i sincerely appreciates 
collaboration with the Federal Government to advance our 2030 targets. 
I thank you for your leadership to elevate the pressing issues of 
climate change and sustainability in Congress and for the opportunity 
to highlight Hawai`i's priorities.

    Senator Schatz. Thank you, Governor.
    Ms. Jimenez.

 STATEMENT OF JULIA VALENTINO JIMENEZ, ROOSEVELT HIGH SCHOOL, 
                          HONOLULU, HI

    Ms. Jimenez. Good afternoon.
    My name is Julia Jimenez. I'm a homeschooled senior, who 
has had the privilege of being a part of the Schatz Senior 
program. I'd like to thank Chairman Senator Schatz for allowing 
me to speak before the committee today.
    As the next generation to join the work force and venture 
out into the world, we have a vested interest on the issues of 
climate change and sustainability. We see these problems. We 
see our future. For truly these problems are our future.
    If nothing is done now, it is my generation that will have 
to pick up the pieces. That is why I am here today, to urge 
Congress to address these problems while we still can. For it 
is much easier to move a vase away from the edge than to glue 
it back together once it has been broken.
    Although climate change and sustainability may be important 
issues that are often talked about, I found that people of the 
community truly don't understand the depth of the problem. In 
my own circles of family and friends very, very few even 
recognize that climate change is actually happening. There is a 
certain ignorance or denial that allows people to turn a blind 
eye.
    Before we can begin to solve climate change and prevent an 
unsustainable future we must recognize that there's something 
to change and prevent. Congress must partner with the 
communities to make a true difference. In order to do this 
education must be a priority, for citizens and businesses 
alike.
    I recommend that Congress invest in research on what is the 
best way to reach the communities whether that be through 
unbiased curriculum in the schools or innovative outreach 
programs.
    Another recommendation would be for Congress to set up an 
incentive plan so that companies would be encouraged to educate 
their customers about sustainable technologies. If these 
environmentally conscious products were introduced into our 
lives I believe it would not only educate citizens but 
encourage them to take an active role in a sustainable future.
    Climate change is primarily caused by greenhouse gases that 
are often caused by the emission of carbon dioxide after its 
source has been used for fuel for certain technologies. Last 
night former Vice President, Al Gore, said a wonderful quote, 
saying, ``It is like we decided to use the atmosphere as an 
open sewage line for gas waste.'' He also compared the 
pollution of human kind to releasing 400,000 Hiroshima bombs in 
24 hours. This is why it is up to us to keep careful watch of 
our own carbon footprints as individuals and as a Nation.
    A program is being created in Hawaii called Ka Hei. This 
program allows schools to become environmentally conscious and 
sustainable while reducing the carbon footprints of the 
infrastructures themselves. This program sets us a clear plan 
toward sustainability and green energy including the goals of 
reducing costs in 255 DOE schools, implementing sustainability 
and energy efficiency, supporting the goal of 90 percent clean 
energy by 2040 and having more educational opportunities 
concerning sustainability and stimulating the economy through 
local construction labor.
    Even though this program was created for schools it is not 
limited to that capacity.
    I would like to recommend for the committee to set in place 
Federal incentives for companies, offices and schools implement 
plans similar to this.
    Too often do I walk into a government building and see the 
old school lights that hike up electricity costs and the use of 
desktop computers when the use of laptops could save more 
energy. It is for this reason that I would recommend the 
committee put forth a timeline for government buildings to 
become more cost effective and energy efficient and diminish 
their own carbon footprint.
    When we talk of such massive issues as climate change and 
sustainability every bit of help counts. If we, as a nation, 
can commit to adapting our infrastructures to be 
environmentally conscious I believe that we can make a true 
difference in the fight against climate change.
    For years I lived in a city called Bakersfield in 
California. Bakersfield is surrounded by a horseshoe of 
mountains where smog will come to sit. This created a horrible 
air quality that actually affected my lung capacity and gave me 
breathing problems. No one wants our beautiful island to become 
like this nor do we want our nation to become like this. That 
is why climate change is such an important issue, not only for 
our generation, but also for your generation now.
    Thank you again to Senator Schatz for allowing myself and 
my fellow intern to testify today. We are grateful that 
Congress and the committee is dedicated to addressing climate 
change and sustainability for the actions that you do now will 
affect our future.
    Thank you.
    [The prepared statement of Ms. Jimenez follows:]

 Prepared Statement of Julia Valentino Jimenez, Roosevelt High School, 
                              Honolulu, HI
    Good afternoon. My name is Julia Jimenez and I am a homeschooled 
senior who has the privilege of being a part of the Schatz Seniors 
program. I would like to thank Chairman Senator Schatz for allowing me 
to speak today before the committee.
    As the next generation to join the work force and venture out into 
the world, we have a vested interest on the issues of climate change 
and sustainability. We see these problems and we see our future, 
because truly these problems are our future. If nothing is done now, it 
is my generation that will be left to try and pick up the pieces. That 
is why I am here today: to urge Congress to address these problems 
while we still can. It is much easier to move a vase away from the edge 
then to glue it back together again.
    Although climate change and sustainability may be an important 
issues that are often talked about, I have found that people of the 
community truly don't understand the depth of the problem. In my own 
circles of friends and family, very, very few even recognize that 
climate change is happening. There is a certain ignorance or denial 
that allows people to turn a blind eye. Before we can begin to try to 
solve climate change and prevent an unsustainable future, we must first 
recognize that there is something to solve and prevent. Congress must 
partner with communities to make a true difference. And in order to do 
this, education must be a priority, for citizens and businesses. I 
recommend that Congress invest in research on what is the best way to 
reach the communities, whether that be through more unbiased curriculum 
in schools or innovative outreach programs. Another recommendation 
would be for Congress to set up an incentive plan, so companies would 
be encouraged to educate their customers about sustainable 
technologies. If these environmentally conscious products were 
introduced in our lives, I believe it would not only educate citizens, 
but encourage them to take an active role in a sustainable future.
    Climate Change is primarily caused by greenhouse gasses, which are 
often caused by the emission of carbon dioxide after its source has 
been used as fuel for certain technologies. That is why it is up to us 
to keep careful watch of our own carbon footprints, as individuals and 
as a nation. A program is being created in Hawaii call Ka Hei. This 
program allows schools to become environmentally conscious and 
sustainable, by reducing the carbon footprint of the infrastructures 
themselves. This program sets up a clear plan towards sustainability 
and green energy, including the goals of reducing costs of 255 DOE 
schools, implementing sustainability and energy efficiency, supporting 
the goal of 90 percent clean energy by 2040, having more educational 
opportunities concerning sustainability, and stimulating the economy 
through local construction labor.
    Even though this program was created for schools, it is not limited 
to that capacity. I would like to recommend for the Committee to set in 
place federal incentives for companies, offices, and schools to 
implement plans similar to Ka Hei. Too often do I walk into a 
government building and see the old-school lights that hike-up 
electricity costs, and the use of desktop computers when the use of 
laptops could save more energy. It is for this reason that I would 
recommend the Committee put forth a timeline for government buildings 
to put in place cost effective and energy efficient measures to 
diminish their carbon footprint. When we talk of such massive issues as 
in climate change and sustainability, every bit of help counts. If we 
as a nation could commit to adapting our infrastructures to be 
environmentally conscious, I believe we could make a true difference in 
the fight against climate change.
    Thank you again to Senator Schatz for allowing myself and my fellow 
intern to testify today. We are grateful that Congress and the 
Committee are dedicated to addressing climate change and 
sustainability, as the actions you do now will affect our future.

    Senator Schatz. Thank you very much.
    Mr. Morimoto.

STATEMENT OF JULIAN MANGADLAO MORIMOTO, ROOSEVELT HIGH SCHOOL, 
                          HONOLULU, HI

    Mr. Morimoto. Good afternoon. Good afternoon, everyone.
    My name is Julian Morimoto. Before I begin I would like to 
thank Chairman Schatz and the Subcommittee on Water and Power 
today for taking the time to listen to our testimony. I'd also 
like to take this time to acknowledge my fellow interns in the 
audience. Interns, please wave. Because truly, without them, I 
would not have had the opportunity to be here today and discuss 
our efforts to create a better future for the State.
    My fellow intern, Julia Jimenez and I, are grateful to be 
here today on behalf of the Schatz Seniors Program to testify 
on matters regarding sustainability efforts. How we, not as 
individuals, corporations or groups, but as a community, can 
finally bridge the dismal gap between ourselves and the 
brighter, greener, more sustainable future. My one wish is that 
after today we can all step out of this building with a clear 
vision for the future of our country.
    The Schatz Seniors decided to undertake an innovative 
project to create a system that would rank schools in terms of 
their environmental friendliness. Hopefully once the system is 
finally complete it will serve as a model for schools in other 
States. We would like to share with you what we have been 
working on and where we plan to go with this in the future.
    The purpose is to create an annual, publicized ranking 
system by which we can compare local high schools in terms of 
their sustainability. We decided that there were 3 main 
questions that needed to be answered.
    One is already being done to rate the eco-friendliness of 
schools.
    What should we propose be included in such criteria?
    How would we implement such a system?
    We then proceeded to collect information from schools, 
programs and institutions throughout the island.
    The main 7 criteria proposed were energy usage, water waste 
diversion, educational opportunities, food services, 
responsible resource management, transportation and campus 
initiative.
    In addition to these basic ideas some sample questions that 
would be needed to--that would need answers would be other 
courses offered that are dedicated to teaching students about 
sustainability and environmental awareness, other regular 
school sponsored events promoting environmental awareness and 
other active student led organizations dedicated to sustainable 
practices.
    It is our hope that this will be implemented in both 
public, private and charter schools by 2016.
    I present this project to you today in hopes that the 
Senate will take these programs to the next level. Instead of 
merely implementing them only in Hawaii why not expand and give 
schools throughout the United States the incentive to be 
greener both on campus and off campus. These incentives could 
include national awards and merits and will encourage schools 
they should want to take part in creating a sustainable future.
    At the end of the day by providing incentives and deciding 
what makes up these criteria, the people of the United States 
will know that these issues are important and that our 
government is dedicated to them, to fixing them. Student 
engagement is critical to affecting change, developing leaders 
of the future and creating awareness of global, national and 
local issues also.
    While we support Federal legislation such as Senator 
Boxer's Carbon Tax bill, we know that that effort will take 
time. However, as Senators, hosting conversations within their 
States can be done now and will make an impact.
    Yesterday former Vice President, Al Gore, spoke to an 
audience of 9 thousand including over 4,000 students. More 
importantly the conversation and excitement continued as the 
students boarded buses and left for over 30 different schools. 
We strongly encourage the Senate to reach out to students and 
young people and engage them in meaningful conversations about 
sustainability.
    By hosting summits, lectures and community conversations 
with students of all ages changing the vocabulary to explain 
technical and regulatory issues in easy to understand terms and 
avoiding acronyms.
    Giving concrete examples that young people and their 
families can implement regardless of geography and income.
    Keeping the message short and focused.
    Also creating programs such as high school internships, 
school awards, contests that include and inspire students to 
get involved and learn.
    The Gore lecture also proved to be a rather inviting and 
informative experience. We think that the 2 most important take 
aways are that there is hope. There is statistically 
significant evidence that suggests we are moving in a better 
direction. Furthermore, our actions today will affect the world 
we live in tomorrow.
    Projects like the Green School Ranking System aren't just 
about breathing cleaner air and fixing climate change. As 
leaders it has been our obligation to not only better the world 
of today, but also to shape the world of tomorrow. We hope that 
eventually similar systems to the Green School Ranking will 
soon be implemented in other States and serve as sustainability 
models throughout the country.
    Thank you once again.
    [The prepared statement of Mr. Morimoto follows:]

Prepared Statement of Julian Mangadlao Morimoto, Roosevelt High School, 
                              Honolulu, HI
    Good afternoon everyone! My name is Julian Morimoto, and before I 
begin I would like to thank Senator Brian Schatz, Governor Neil 
Abercrombie, the Senate Committee on Energy and Natural Resources, and 
all the witnesses present today who took the time to hear our 
testimonies. I'd also like to take this time to acknowledge my fellow 
interns in the audience (interns please wave to the rest of the 
audience); for without their hard work, I would not have had the 
spectacular opportunity to stand here today and discuss our efforts to 
create a better future for this wondrous state. My fellow intern, Julia 
Jimenez, and I are gratefully here on behalf of the Schatz Seniors' 
program to testify on matters regarding sustainability efforts and how 
we--not as individuals, corporations, or groups, but as a community--
can finally bridge the dismal gap between ourselves and the brighter, 
greener, more sustainable future. My one wish, is that after today, we 
can all step out of this building with a clearer vision for the future 
of our glorious country.
    The Schatz Seniors Program give high school students precious 
first-hand exposure to the areas of public policy and public 
administration. For me--and many others--this opportunity has been one 
of the highlights of my senior year. The program has greatly broadened 
our intellectual horizons, and given us skills we can use to continue 
positively impacting our community for years to come. This year, the 
Schatz Seniors embarked on a revolutionary journey to impact the way 
schools throughout Hawai'i integrate sustainability through curriculum, 
student-led programs, infrastructure, and community integration.
    The project began when Senator Schatz learned colleges were being 
ranked in terms of their eco-friendliness. In this, he saw opportunity. 
He wondered if it would be possible for such a system to be implemented 
in Hawai'i to positively impact public educational institutions in the 
state of Hawai'i. The team captains of this project were seniors Erin 
Carroll, Kara Tanaka, and myself. We decided that there were three main 
questions which needed answers:

          1. What is already being done to rate the eco-friendliness of 
        schools?
          2. What should we propose be included in such criteria?
          3. How would we implement such a system?

    We then proceeded to collect information from schools, programs, 
and institutions throughout the island. The main seven criteria we 
proposed were:
          1. Energy usage
          2. Waste diversion
          3. Educational opportunities
          4. Food services
          5. Responsible resource management
          6. Transportation
          7. Campus initiative

    I am sad to say, however, that our time as Schatz Seniors is almost 
over, and that we will have to leave the actual implementation of this 
system to the next group of Schatz Seniors; and I hope, that they will 
learn and grow just as much as we did throughout the course of this 
project.
    I present this project to you today in hopes that you will take 
programs like these to the next level: instead of merely implementing 
them only in Hawai'i, why not expand, and give schools throughout the 
United States the incentive to be greener both on-campus and off-
campus? These incentives could include national awards and merits, and 
will encourage schools nationwide to take part in creating a 
sustainable future. To the senate committee on energy and natural 
resources, perhaps you could also play a part in determining what 
should be taken into consideration when ranking schools around the 
nation. At the end of the day, by providing incentives and deciding 
what makes up these criteria, the people of the United States will know 
that these issues are important, and that our government is dedicated 
to fixing them.
    Projects like the Green School Ranking aren't just about breathing 
cleaner air or fixing climate change. From the time I was old enough to 
count, my generation has always heard, ``You are the leaders of 
tomorrow.'' Now, I stand here today, at the near-end of my high school 
career, finally beginning to understand what this meant. As leaders, it 
has been our obligation to not only better the world of today, but also 
to shape the world of tomorrow. My fellow interns and I each had our 
own reasons for taking part in this project, and I will share mine. I 
took part in this project because I wanted to ensure that twenty years 
from now, I can look into the pure eyes of a child and say, ``You are a 
leader of tomorrow.'' knowing that he or she can learn and grow to be a 
remarkable individual in a greener, brighter, and greater country.

    Senator Schatz. Thank you very much to the testifiers.
    I'll start my questions for Governor Abercrombie.
    Mr. Abercrombie. Thank you.
    Senator Schatz. Governor, I know you've been appointed to 
the President's Climate Task Force. I wonder whether you 
wouldn't mind giving us an update on how it's working, who 
comprises the task force and what their timeframe is in terms 
of providing a work product for some national policy changes?
    Mr. Abercrombie. I would be delighted to do that.
    This is in the packet that I was providing to you. It's our 
report to the initial conference. The--it covers fresh water 
coastlines, ocean resources, security, culture, sensitivity to 
culture, actual information decisionmaking context, how to 
facilitate coordination, etcetera.
    It involves, more formally, tribal leaders, mayors, council 
members, Governors, all across the country to try to address 
both the regional and national conditions and circumstances 
that are--that climate preparedness and resilience. It's not 
just a matter of addressing the idea that there is climate 
change, global warming, for which we have to be prepared for 
what to do in terms of being able to be resilient to do it.
    The--there's been a meeting in Los Angeles and another 
coming up in Iowa. With your permission I'd like to give the 
opportunity to Jackie Thiel to summarize that for you because 
she is our Sustainability Coordinator. I think it would give 
you some of the details which show that this more than just a 
forum or an academic exercise, but an opportunity for us to 
move genuine recommendations forward for legislation.
    Senator Schatz. Please, Ms. Thiel.
    Ms. Thiel. Hello, Senator.
    Thank you, Governor, for the opportunity to add.
    It's been a great honor supporting our Governor in this 
role. He's one of only 8 Governors that were appointed to the 
task force. So it's a tremendous opportunity for Hawaii. 
Actually the Governor of Guam is another.
    So I know this hearing is about Hawaii and other islands. 
So it's been great for Governor Abercrombie and Governor Calvo 
to bring the message of islands to this task force. They are 2 
of 26 members. So as the Governor mentioned mayors and county 
commissioners are also involved.
    The task force is focusing on 4 major areas of climate 
resilience. So, built systems which includes a lot of the 
things that we talked at ASCENT yesterday, the water/energy 
nexus, transportation, a lot of those built assets that we have 
there that are going impacted by sea level rise and other 
climate change impacts, also natural resources and agriculture, 
community health and developments.
    We are really lucky in Hawaii that we don't have mosquito 
borne illnesses like malaria and dengue fever, but these have 
been identified as climate sensitive diseases.
    Finally, disaster managements.
    One thing that I think was really striking at our first 
meeting in DC is that many of the other task force members have 
recently suffered a disaster. They were there for super storm 
Sandy, for Irene, fires and floods and Fort Collins Mayor, 
Mayor Weitkunat spoke of that. So I think that Hawaii is really 
in a position to learn from these other places that have more 
recent disasters than we have.
    Governor Abercrombie. So one of the things we're doing then 
is having what we call resiliency forms here. Again maybe 
Jackie can elaborate a little bit on what we've already done 
and what we plan.
    Ms. Thiel. So one of the things that the White House really 
asked us to do is that could only ask, you know, only appoint 
26 members, was to really reach out and engage stakeholders in 
our region, in our States. So we've engaged over 1,000 citizens 
in Hawaii through online survey and Resilient Hawaii forms. One 
was during the Pacific Risk Management ``Ohana Conference 
recently that NOAA. NOAA has been an amazing partner to us 
through this process, helping to support our resilient white 
forms. I think a great example of Federal partnerships.
    Senator Schatz. So Governor, I have a question about----
    Mr. Abercrombie. Could I just add one point to that?
    Senator Schatz. Go ahead.
    Mr. Abercrombie. It's a fact of nature. What do we do about 
rising water, for example? What we've gone through is proposals 
concerning reefs, concerning what we can do to deal with the 
question of rising water because it's one thing to talk about 
it in the abstract or in mega terms. It's another one, 
literally, every inch of our land mass is coastline. So and 
each island, within different regions and sections of the 
island, has its own issues associated with it.
    So that's the kind of thing that that the resiliency forms 
are dealing with. We know that we don't have a cookie cutter 
approach that's going to work where one size fits all. It's 
going to have to be site specific and regional specific.
    Senator Schatz. At the level of mayor and Governor and 
county commissioner is there bipartisan cooperation? Is there a 
recognition? You know, what I found even in the halls of the 
Senate is that if we talk about disaster preparedness, if we 
talk about severe weather, if we talk about civil defense, then 
I can find common cause with bipartisan dance partners.
    I'm wondering with, in the context of this task force, if 
you can get mayors who are Republicans to participate as long 
as you're careful with your language?
    Mr. Abercrombie. Yes. Yes.
    Let me put it this way. Disasters like Hurricane Sandy know 
no ideology. There is no political points to be scored.
    The climate change, global warming, is no respecter of 
particular partisan interests. So that is well recognized that 
the language that we indicate is one of coordination and 
cooperation because these things are not isolated in political 
jurisdictions. A city boundary means absolutely nothing to a 
hurricane or a cyclone or a flood or a heat wave or as you 
probably experienced much to your great regret, more often than 
not, a freeze wave.
    Senator Schatz. Polar vortex.
    Mr. Abercrombie. Polar vortex. Yes. Yes.
    [Laughter.]
    Mr. Abercrombie. Another phrase that has been added to the 
mix.
    So the short answer is yes. It is possible by focusing on 
what we have in common rather than what differences can be 
conjured on.
    Senator Schatz. So one final question for the Governor and 
perhaps for your Assistant Building Coordinator before I move 
on to the students and allow you to get back to your work.
    I'm interested, very much, in the progress that State and 
county governments are making here, but also nationally in 
energy efficiency performance contracting and would love it if 
you would talk a little bit about what State and I know the 
city and county of Honolulu has made good progress.
    Mr. Abercrombie. Yes.
    Senator Schatz. Talk about how the economics have shifted 
in ways that provide us real opportunities?
    Mr. Abercrombie. Let me just give you a little example.
    At the Honolulu International Airport we've signed a 
contract on energy efficiency and light that is going to save 
in 2013-2014 dollars, $10 of millions of dollars, perhaps into 
hundreds of millions of dollars by the time it's over by 
changing, simply by having a relentless approach to modernizing 
our technology, utilizing modern technology, in light. Just 
that alone saves money instantaneously. That's money that can 
be invested back into further activity in order to make 
everything work more efficiently.
    That is going across the country. Our on bill financing to 
enable people to get energy efficiency through renewable 
energy, the resources that otherwise might not be possible in 
terms of financing. If you can pay it on your energy bill and 
pay it off just as if it was a mortgage, this is something that 
brings it down to the grass roots level and gives visible 
evidence to a family that they are not just subject to energy 
prices, the object of it, but rather that they can get control 
over their own lives, financially and otherwise.
    What this does, in my judgment, is an opportunity for 
people then to say, look, I can do something about it. I'm not 
just the victim here. I'm not just an observer of something 
being done to me. I'm able to, not only participate, but take 
an active role and seem to then meet the energy challenge of 
this century.
    Senator Schatz. Thank you very much, Governor, for 
providing your testimony.
    Feel free to stay with the other testifiers, but if you 
have to----
    Mr. Abercrombie. Thank you.
    Senator Schatz. Go, we understand.
    Ms. Jimenez, I have a question for you about your--about 
people your age and their awareness of climate change as an 
issue. I'm wondering whether your average teenager is aware at 
all about this problem.
    My sense is that young people in Hawaii care very much 
about the environment, but it tends to be more local intensity, 
more land use based intensity, more about your personal 
experience in the environment. As important as climate change 
is, I understand it's somewhat abstract for a 15 year old. I'm 
wondering whether my assessment is correct or whether the 
awareness is growing?
    Ms. Jimenez. I would have to say that there definitely is a 
disconnect between what the teenagers of Hawaii, at least that 
I know, believe is happening and what is actually happening. 
There seems to be a problem of not truly understanding with 
that of the problem. It's not an issue that is in normal 
conversation, at least in my circles.
    I would have to say that in my circles we are usually very 
politically competent. We keep up with the news. We know the 
legislatures. We actually go out and campaign. We discuss 
political topics on a day by day basis. The topic of 
sustainability has not come up once.
    That's just something from my own personal experience of 
they're not understanding the true depth of the issue. I think 
that's why it's important for there to be a more integration of 
education for the teenage community in Hawaii on not just the 
overreaching issue of global warming and to go down to the more 
specifics of sustainability, specifically to water 
sustainability.
    Senator Schatz. Thank you very much, Ms. Jimenez.
    I have a question for Mr. Morimoto and then a question for 
both of you. This is my third question for both of you is 
purely to satisfy my own curiosity.
    [Laughter.]
    Senator Schatz. My question for you is what's happening 
from your standpoint because I know from the Department of 
Education's standpoint what's happening in environmental 
education. But I want you to tell me what's happening in 
environmental education at Roosevelt High School.
    Mr. Morimoto. OK.
    At Roosevelt High School we have a little garden by the 
Science Department building. I think it was a really cool 
innovation. Usually the Green Club goes and checks in on it. 
They really integrate themselves into learning how to properly 
take care of plants. I'm sure they also learn, like, what is 
also really harmful and detrimental to the growth of plant life 
in Hawaii.
    What we also have is AP Environmental Science which that is 
also teaching young students how to play an active role in 
creating a better environment for their future.
    A few years ago we had the Law and Leadership Academy. AP 
Environmental Science was one of the required presences. I'm 
assuming that the faculty knew that environmental issues were 
going to become a very integrated part of discussions of the 
modern world today.
    Senator Schatz. Thank you very much. I appreciate that.
    Let me just ask one final question for the both of you.
    How do you and how do your peers get your information 
primarily?
    Ms. Jimenez. My situation is a little unique since I am 
homeschooled. The greater majority of my friends are also 
homeschooled as well. So honestly we get our information just 
from regular news sources, just as an adult may.
    We watch the news. We read newspapers. We talk about it 
amongst ourselves. It's honestly also the conversation that's 
going around us, what the adults are also talking about, we'll 
chime in with our own opinions.
    We don't have the luxury of the public and private schools 
that have the classes integrated into the system. We have to go 
find our own information.
    Senator Schatz. Mr. Morimoto, how luxurious is Roosevelt?
    [Laughter.]
    Senator Schatz. Where do you and your friends get your 
information?
    I mean, obviously, your teachers. But I'm more interested 
in how you consume the news and how you get factual 
information.
    Mr. Morimoto. In regards to daily life or regards to the 
Green School project?
    Senator Schatz. I mean more generally in terms of what's 
happening in the world. Are you--is it social? Is it television 
and the newspaper like the rest of us? Is it mostly the web or 
where are you getting your information?
    Mr. Morimoto. I believe that currently at my school at 
least what I've noticed over the years is that the medium of 
which information is transferred between individuals is very 
different. Comparing schools I know some schools are still 
using Facebook while others are, like, you know, Facebook was 
so 10 years ago.
    [Laughter.]
    Mr. Morimoto. With our----
    [Laughter.]
    Ms. Jimenez. Twitter and Tumblr.
    Senator Schatz. Now you have his complete attention.
    [Laughter.]
    Mr. Morimoto. However, at Roosevelt the main media of 
communication is, in fact, social media.
    The teachers are very integrated with their class, with 
their students. So they also share information as well.
    Nowadays with smart phones, you may or may not already be 
aware of this, but a lot of us won't, no that's not right, 
but----
    [Laughter.]
    Mr. Morimoto. A lot of us have apps like CNN. So I get CNN 
reports on my phone very often throughout the day. I even got a 
few during yesterday's session which I didn't look at, 
obviously.
    But those--that is also a really common media is through 
cell phones and social media. That can be mobile. Because 
that's what this world today is all about, right? Mobile. 
You're always on the go.
    So if you really want to reach out to people of my age and 
hopefully for future generations. I will be out of touch 1 day, 
but until that day comes.
    [Laughter.]
    Mr. Morimoto. I think that going mobile. Going mobile and 
being integrated in that system is a great way to go.
    Senator Schatz. Thank you.
    Ms. Jimenez. If I may?
    Senator Schatz. Sure, Ms. Jimenez and then we'll move on to 
the next panel.
    Go ahead, please.
    Ms. Jimenez. Going on with what he said. If you asked a 16/
17 year old to sit down and watch an entire news program or 
documentary on climate change you will get glassed over eyes 
and a lot of texting.
    [Laughter.]
    Ms. Jimenez. But if you post on Facebook and you ask them 
to go look at Facebook they can do that.
    If you ask them to go look at Twitter, they can do that and 
Tumblr and all of the other social media sites. It's something 
that we do daily. So that is definitely a way to reach the 
younger generation.
    Senator Schatz. Thank you very much. We'll take your 
testimony----
    Mr. Abercrombie. Thank you for not asking me that question.
    [Laughter.]
    Senator Schatz. Thank you very much to the testifiers. We 
appreciate your testimony.
    Ask the second panel to go ahead and sit at the testifier's 
table.
    Mr. Abercrombie. Thank you, Chairman.
    Senator Schatz. With us today we have Hermina Morita, Chair 
of the Hawaii Public Utilities Commission.
    Dawn Lippert, Director of the Energy Excelerator in Hawaii.
    Wendy Meguro, Assistant Professor of Sustainable Buildings 
and Community Design at the University of Hawaii, Sea Grant 
Program.
    Harrison Rue, County Building and TOD Administrator for the 
City and County of Honolulu, Department of Planning and 
Permitting.
    Bill Tam, Deputy Director of the Commission on Water 
Resource Management, Department of Land and Natural Resources.
    Dr. Stephen Pauley, President of the E.W. Pauley 
Foundation.
    Thank you all for being here. Your written testimony will 
be included in the record. So please take about 5 minutes to 
summarize your main points.
    Ms. Morita, we'll start with you and move down the line.

STATEMENT OF HERMINA M. MORITA, CHAIR, HAWAII PUBLIC UTILITIES 
                    COMMISSION, HONOLULU, HI

    Ms. Morita. Thank you, Senator.
    So I'll just get straight to the point.
    You know, last October I had the privilege of participating 
in a State efficiency and renewable power policy roundtable 
which was convened by the former Chair of the Senate Committee 
on Energy and Natural Resources, Jeff Bingaman and the former 
Secretary of State, George Schultz at Stanford's Steyer-Taylor 
Center for Energy Policy and Finance. The roundtable included 
the Chairs from 4 States, the PEC Chairs from 4 States, Hawaii, 
Kansas, Texas and Washington and the Chair of the New York 
State Energy Research and Development Authority. It was an 
effort to identify which State level energy policies have 
proven to be the most effective and which ones have succeeded 
and ultimately which policies can attract bipartisan support to 
help mitigate climate change.
    My understanding is the report should be out this summer.
    The roundtable discussion was focused in 4 areas.
    Renewables.
    Energy Efficiency.
    Customer Generation.
    Financing Mechanisms.
    So I'm going to focus in these 4 areas so you have a basis 
for comparisons with other States when the report becomes 
available.
    So the first is renewable energy. We are on track to exceed 
our 2015 renewable portfolio standards target of 15 percent and 
expected to meet our 2020 target of 25 percent.
    The Hawaiian electric companies have achieved a 
consolidated RPS of 34.4 percent in 2013. But remember this 
includes energy efficiency savings as well as solar water 
heating technologies.
    So excluding those types of energy savings the HECO 
Company's renewable energy generation percentage is at 18.2 
percent.
    The 2013 RPS report for the Kauai Island Utility 
Cooperative has not been filed with the Commission yet. 
However, KIUC increased its percentage from 14.69 percent in 
2011 to 16.64 percent in 2012. They anticipate to have online 
by 2015 an additional 24 megawatts of photovoltaics and 6.7 
megawatts of biomass. That's pretty amazing for a utility with 
a system peak of approximately 76 megawatts.
    Regarding energy efficiency.
    Hawaii's energy efficiency portfolio standards mandate 
target is 43 hundred gigawatt/hours electric use reduction by 
2030. Hawaii is on track to achieve more than 1,550 gigawatt 
hours in savings by 2015. That exceeds our internal target by 
more than 12 percent.
    Hawaii Energy, the ratepayer funded energy efficiency 
services provider which administers the public benefit fee, is 
an essential component of the State's efforts to capture 
untapped energy efficiency resources contributing more than 80 
percent of the energy savings achieved since 2009. In the 
program year ending June 30th, 2013 Hawaii Energy programs will 
deliver 1.4 billion kilowatt/hours in lifetime savings at a 
total program cost of 2.3 cents per kilowatt/hours. This, in 
turn, will save an estimated equivalent of 2.4 million barrels 
of oil and 1.2 million tons of greenhouse gas emissions.
    At an average electricity price of 30.7 cents per kilowatt/
hours customers will save approximately 450 million dollars on 
their electricity bills over the life of the installed 
efficiency measures.
    With regard to customer generation.
    Hawaii's electric utilities lead the Nation in the 
installation of group photovoltaics relative to the size of our 
island grids. Since 2005 Hawaii has seen exponential growth in 
the amount of PV installed on each island and the level of PV 
capacity relative to the demand on each island is approaching 
20 percent.
    Senator, when we passed the 2001 net legislation the system 
peak at that time that we're striving for was .5 percent. So, 
you know, we've made some strides there.
    On Oahu approximately 10 percent of residential customers 
have installed PV systems on their home. No other State or 
utility is currently experiencing such high levels of customer 
sided PV. For this reason there's considerable interest in the 
next steps Hawaii will take as we continue to forge new ground.
    With regard to financing.
    It's a really exciting area for Hawaii. The Commission will 
self launch by summer its on bill program where electricity 
customers will be able to pay for efficiency or renewable 
improvements on their electricity bill through a tariff 
mechanism. The on bill program will have 2 components, an on 
bill financing mechanism where the public benefit fee will be 
leveraged for fixed efficiency improvements like solar water 
heaters and an on bill repayment mechanism where other entities 
may access the customer's electricity bill for repayment such 
as the Department of Business Economic Development and 
Tourism's Green Energy Market's Securitization or GEMS.
    GEMS is a pioneering program which combines 2 tried and 
true financing methods, a traditional rate reduction bond 
structure and on bill financing in a synergistic model. This 
innovative structure can open the door for a whole new 
financing market in renewables and energy efficiency. So 
although the GEMS program was invented in Hawaii to serve 
Hawaii's residents and businesses the program has drawn 
national attention and could potentially serve as a model for 
other States.
    DBEDT hopes to file its application for the GEMS program 
with the Commission to implement the program by this summer. 
The Commission has just circulated its term sheet within the 
investment community and hope to get responses by the end of 
April for its efficiency program.
    Just to sort of sum up our largest challenge in moving 
toward clean energy transformation.
    I feel our biggest challenge and I think you've heard me 
mention this before, is moving from clean energy 1.0 to clean 
energy 2.0 and beyond. Clean energy 2.0 recognizes that 
transformation requires a systems approach requiring technology 
and economics to inform and shape policy, energy policy, to 
provide clean, safe, reliable, affordable electricity and 
achieve environmental and societal goals within a regulatory 
framework.
    The second biggest challenge is the strategy and transition 
for a new electricity, electric utility business model and the 
regulatory reform necessary to facilitate this transition in a 
timely way, especially since we are so on the leading edge.
    So recently my fellow Commissioner, Lorena Akiba remarked, 
Hawaii is a coast guard for the future. So while we're often 
cited for our success we are also trailblazers with big 
challenges before us.
    So, thank you for this opportunity.
    [The prepared statement of Ms. Morita follows:]

Prepared Statement of Hermina M. Morita, Chair, Hawaii Public Utilities 
                        Commission, Honolulu, HI
    Thank you for the opportunity to testify on Hawaii's success and 
its challenges in meeting its sustainability goals. Hawaii's Public 
Utilities Commission (``Commission'') is responsible for the oversight 
of meeting Hawaii's clean energy statutes through its regulation of 
Hawaii's electric utilities and mandated programs. Today, I would like 
to share with the Committee (1) the key policy drivers under the 
jurisdiction of the Commission to accomplish Hawaii's clean energy 
transformation with an overview and status of each key policy driver; 
and (2) the challenges of accomplishing Hawaii's clean energy 
transformation.
    Hawaii articulates a multi-prong approach in the implementation of 
Hawaii's clean energy future through the following laws:

   Renewable Energy Portfolio Standards (``RPS'')
   Energy Efficiency Portfolio Standards (``EEPS'')
   Public Benefit Fee (``PBF'')
   Act 99, SLH 2012 (``Act 99'')

    --the public utilities commission shall consider the costs and 
            benefits of a diverse fossil fuel portfolio and of 
            maximizing the efficiency of all electric utility assets to 
            lower and stabilize the cost of electricity

    In its totality, Hawaii's energy policies attempt to shift the 
focus from individual renewable energy generation projects to a systems 
approach, requiring technology and economics to inform and shape energy 
decisions to advance three regulatory goals, while capturing 
environmental and social benefits:

          1. Encourage prudent investments in and the utilization and 
        optimization of all assets, both utility and non-utility, 
        centralized and distributed, that bring efficient and cost-
        effective benefits and value to the electric system to serve 
        the public good.
          2. Appropriate allocation of fixed costs to maintain and 
        enhance the electric system, i.e. a customer pays for the 
        services received from the grid and is fairly compensated for 
        services a customer provides to the grid.
          3. Accessibility, fairness and the opportunity for all 
        electricity customers to benefit from clean energy policies and 
        programs.
   Key Policy Drivers to Enable Hawaii' s Clean Energy Transformation
Renewable Portfolio Standard
    --10 percent of net electricity sales by December 31, 2010
    --15 percent of net electricity sales by December 31, 2015
    --25 percent of net electricity sales by December 31, 2020
    --40 percent of net electricity sales by December 31, 2030

    I am happy to report that Hawaiian Electric Company, and its 
subsidiaries, Hawaii Electric Light Company and Maui Electric Company 
(collectively the ``HECO Companies''), have achieved a consolidated 
Renewable Portfolio Standard of 34.4 percent in 2013, which includes 
electrical savings from energy efficiency and solar water heating 
technologies.\1\ This is an increase from the 28.7 percent achieved in 
2012. Excluding electric energy savings, the renewable energy 
generation percentage for the HECO Companies is 18.2 percent.
---------------------------------------------------------------------------
    \1\ Beginning January 1, 2015, electrical savings shall not count 
toward renewable energy portfolio standards.
---------------------------------------------------------------------------
    The 2013 RPS report for Kauai Island Utility Cooperative (``KIUC'') 
has not been filed with the Commission yet, however, KIUC increased its 
percentage from 14.69 in 2011 to 16.64 percent in 2012 and anticipates 
to have on-line by 2015 an additional 24 megawatts of utility scale 
photovoltaic and 6.7 megawatts of biomass.
    Every five (5) years the Commission conducts a review of the RPS to 
ensure it is effective and achievable. Attached below is a link to the 
report:

          Report to the 2014 Legislature on the Public Utilities 
        Commission Review of Hawaii's Renewable Portfolio Standards--
        Issued Pursuant to Section 269-95(5), Hawaii Revised Statutes: 
        http://puc.hawaii.gov/wp-content/uploads/2013/04/2013-PUC-RPS- 
        Report__FINAL-w-Appnds.pdf
    Several principal findings in this Report include:

   The 2015 RPS requirement of 15 percent is achievable for 
        both the HECO Companies1 and Kauai Island Utility Cooperative 
        (``KIUC'').
   It appears likely that the 2020 RPS requirement of 25 
        percent is achievable for both the HECO Companies and KIUC, 
        provided that reasonably expected amounts of currently proposed 
        utility-scale renewable energy projects and distributed 
        renewable generation are successfully developed and integrated 
        on the utility systems.
   The 2030 RPS requirement of 40 percent may possibly be 
        achievable, but this cannot be determined with confidence at 
        this time due to uncertainties regarding the magnitude of 
        future utility sales and several substantial outstanding 
        challenges regarding the successful and economical siting and 
        incorporation of requisite renewable energy generation 
        resources. Nonetheless, this target is sufficiently aggressive 
        to effectively focus efforts to address several challenges to 
        the extensive incorporation of renewable resources on the 
        Hawaii utility systems. A number of key issues must be 
        thoughtfully considered when assessing whether current RPS 
        targets should be adjusted or whether additional benchmarks 
        should be established.
   The RPS remains effective in helping the State achieve its 
        policies and objectives with respect to developing renewable 
        energy resources in Hawaii through the 2030 timeframe.

    The Commission anticipates that the results of pending 
investigations and reviews relevant to the RPS will further inform 
consideration of possible future amendments to the RPS targets.
Energy Efficiency Portfolio Standard
    Hawaii's energy efficiency goals were enacted in 2009 and codified 
in Section 269-96, Hawaii Revised Statutes, establishing the EEPS at 
4,300 gigawatt-hours (``GWh'') of electricity saving by 2030.
    Every five (5) years the Commission conducts a review of the EEPS. 
Attached below is a link to the report:

          Report to the 2014 Legislature on Hawaii's Energy Efficiency 
        Portfolio Standard--Issued Pursuant to Section 269-96, Hawaii 
        Revised Statutes: http://puc.hawaii.gov/wp- content/uploads/
        2013/04/2013-PUC-EEPS-Report__FINAL.pdf
    Key findings of this Report include:

   The EEPS goals has proven effective at accelerating 
        deployment of energy efficiency resources throughout the State. 
        An estimated 794 GWh of electricity savings have been achieved 
        statewide since the EEPS law took effect in 2009.
   While there is uncertainty about energy efficiency savings 
        for future years, Hawaii is on track to achieve more than 1,550 
        GWh in savings by 2015, exceeding the interim 2015 EEPS target 
        of 1,375 GWh by more than 12 percent.
   Hawaii Energy, the ratepayer-funded energy efficiency 
        services provider, is an essential component of the State's 
        efforts to capture untapped energy efficiency resources, having 
        contributed more than 80 percent of energy savings achieved 
        since 2009.
   The long-term EEPS goal remains achievable. The cost-
        effective energy efficiency resource available statewide by 
        2030 exceeds the EEPS goal by nearly 50 percent. Energy 
        efficiency remains a lower cost resource than most supply-side 
        energy options, and provides many other important benefits to 
        Hawaii's electricity utilities and ratepayers.
Public Benefit Fee
    The Public Benefits Fee (``PBF'') was enacted in 2009 and 
established in Section 269-121 through 125, Hawaii Revised Statutes, is 
collected by the HECO Companies from ratepayers through a demand-side 
management surcharge. The funds are used to support energy- efficiency 
programs and services, subject to the review and approval of the 
Commission. The law authorizes the Commission to contract with a third 
party administrator to implement and manage energy efficiency programs 
funded by the PBF. The program is called Hawaii Energy and administered 
by Leidos Engineering, LLC.
    June 30, 2013 marked the completion of Hawaii Energy's fourth 
program year (the program year 2012 covered July 1, 2012 to June 30, 
2013). The current surcharge amount is 1.5 percent of forecasted 
utility revenues, the PBF two-year budget for FY 2012 and FY 2013 was 
$71,103,608. The target for FY 2012 was $33,472,166. As detailed in 
Hawaii Energy's PY 2012 Annual Report, Hawaii Energy's programs for PY 
2012 will deliver 1.4 billion kilowatt hours (``kWh'') in lifetime 
savings at a total program cost of 2.3 cents per kWh (all in cost). 
This, in turn, will save an estimated equivalent of 2.4 million barrels 
of oil and 1.2 million tons to greenhouse gas emissions. At an average 
electricity price of 30.7 cents per kWh, customers will save 
approximately $405 million on their electricity bills over the life of 
the installed efficiency measures.
    Hawaii Energy's programs are designed to evolve to enable Hawaii's 
clean energy transformation cost-effectively focused on the following:

   Legacy Demand Side Management Programs--modifying and 
        upgrading programs to meet cost-effective tests
   Efficiency For All--ensuring all ratepayers benefit from the 
        PBF including the underserved, neighbor islands and hard to 
        reach customers like low-income ratepayers and renters
   Conservation--effecting behavioral changes, outreach and 
        ally development
   Transformation--training and educational programs, 
        developing energy leadership
   Sustainability--targeting indirect energy relationships like 
        water-energy nexus

    For additional information, the Hawaii Energy Annual Report can be 
found at the following address: http://puc.hawaii.gov/wp- content/
uploads/2013/04/HawaiiEnergyPY2012AnnualPlan7.19.2012.pdf
Act 99, 2012 Session Laws of Hawaii
    More than half of an electricity customer's bill is comprised of 
fuel and purchased power cost. Through Act 99, the Legislature mandated 
the public utilities commission to consider the costs and benefits of a 
diverse fossil fuel portfolio and of maximizing the efficiency of all 
electric utility assets to lower and stabilize the cost of electricity. 
Currently, Hawaii's electricity and gas utilities are carefully 
examining the feasibility and cost benefit analysis to consider the 
importation of liquefied natural gas to help reduce the cost of fuel 
and improve air quality as well as the choice of fuel to enable more 
flexible generators to increase the penetration of variable renewable 
resources such as wind and solar.
    As a regulator and as a community, one of the challenges of 
effecting a clean energy transformation is moving the discussion and 
focus off of Clean Energy 1.0 to Clean Energy 2.0. In Clean Energy 1.0, 
our energy policies were based on rewarding early adoption of renewable 
energy technologies. Clean Energy 1.0 is simple to understand, 
quantify, discuss and promote. These policies, such as net metering and 
the renewable energy income tax credit, were primarily focused on the 
cost of a renewable project. However, as technologies advance and cost 
are driven down, these policies have distorted the market where we are 
now faced with some perverse effects on the ratepayer who is unable to 
afford or cannot participate in these renewable programs. 
Unfortunately, these type of political policies are not structured to 
react quickly to fix these market distortions.
    Clean Energy 2.0 recognizes that transformation requires a systems 
approach, requiring technology and economics to inform and shape 
desired energy outcomes.
    Hawaii's electric grids represent the critical energy 
infrastructure that is required to advance to and beyond Clean Energy 
2.0 and to serve the public good.

    --The grid provides essential system support services for all 
            customers to enable electricity to be used efficiently, 
            reliably and safely and, desirably, at affordable rates.
    --The grid is required also integrate clean, lower-cost, renewable 
            energy from large scale, centralized solar and wind plants.
    --The grid is also required in order to accept excess generation 
            from customer- sited distributed PV used to offset energy 
            usage (e.g., the NEM program) as well as provide the 
            services required to ensure reliability when there is no 
            generation or inadequate generation from those sites.

    However, the existing grid infrastructure was not designed to 
accommodate large amounts of distributed, variable generation that is 
being rapidly added to each island system due to customer demand and 
technological improvements that have significantly reduced the cost of 
these alternative customer options.
    It is viewed that the future of Hawaii's electric grids will be 
integrated systems with diversified portfolios of modern, quick-
starting, flexible, and efficient generation combined with substantial 
amounts of lower-cost renewable generation (both centralized and 
distributed), as well as new technologies such as demand response and 
energy storage to provide the necessary grid services to ensure 
reliable power.
    Modernizing Hawaii's island grids is a fundamental responsibility 
of the electric utilities and a prerequisite for meeting customer 
demands and the state's clean energy goals. This leads me into the 
second challenge of Hawaii's clean energy transformation which, I 
believe, can only be acted upon by the utility, that is, the electric 
utility as the system integrator. As the system integrator, the utility 
would be agnostic and price sensitive in utilizing a diverse portfolio 
of resources and technologies in optimizing the system to achieve an 
affordable, safe, reliable and sustainable energy services not only to 
support the electric system, but also our economic objectives and 
environmental values.
    With emerging smart technologies and its corresponding data 
management and analytics, forwarding thinking utility executives, like 
many of their counterparts in other sectors are becoming increasingly 
aware of and taking advantage of big data as the next frontier for 
innovation, competition and increased productivity. Progressive 
electric utility executives understand the paradigm shift smart 
technologies brings to the generation, overall operations and 
distribution of electricity, as well as how it will redefine a 
utility's relationship with its customers and other service providers 
to the electric system. How timely a utility can process, analyze, 
synthesize and effectively use the information it gathers will require 
a huge cultural change within the utility, between and within silo'ed 
functions, to accommodate a data driven utility. Without this deep 
organizational cultural change, I am afraid Hawaii's clean energy 
transformation will be difficult to realize. The need to take a systems 
approach and how quickly and effectively utility can gather, analyze, 
synthesize and use the information in the management of the electric 
system are key drivers to effectuate Hawaii's clean energy 
transformation and the key to all this is the ability to optimize the 
productivity of an intelligent electrical grid.

    Senator Schatz. Thank you very much.
    Ms. Lippert.

  STATEMENT OF DAWN LIPPERT, DIRECTOR, ENERGY EXCELERATOR, (a 
                program of PICHTR), HONOLULU, HI

    Ms. Lippert. Aloha and thank you to Senator Schatz and this 
committee for the invitation to testify today.
    I'd actually like to take this opportunity to speak about 
the Energy Excelerator and what, I believe, it has taught us 
about the role of public/private partnerships in accelerating 
innovation.
    The Energy Excelerator is a program of PICHTR and startup 
program designed to help energy innovation companies succeed 
starting in Hawaii.
    Why starting in Hawaii?
    The Senator knows the answer to this question. But 7 years 
ago I was fortunate enough to join the analysis team drafting 
the Hawaii Clean Energy Initiative which we've spoken about 
today. It is bold initiative to set the stage for energy 
transformation in Hawaii from an economy 90 percent dependent 
on oil to one powered by 70 percent clean, local energy.
    At the time it would have been impossible to predict how 
powerful that was and the accelerated moment that this State 
has seen toward clean energy and the role we played as a model 
for other parts of the world. By many standards we are making 
great strides toward that goal. As Mina said, solar, for 
example, has increased 60 fold over the last few years. Eleven 
percent of Oahu households now have solar.
    This success has also led to challenges. It's not easy to 
integrate all of these new renewables onto our island grids. We 
now know that we actually can't reach the 70 percent clean 
energy goal unless we adopt new technologies and develop new 
approaches.
    This is where entrepreneurship becomes linked with the 
future of Hawaii and where I believe the Energy Excelerator 
comes in. Hawaii is now a fertile place for energy 
entrepreneurs. Entrepreneurs like to go to where the pain is 
highest and the urgency is most immediate.
    To energy entrepreneurs Hawaii and other island nations are 
not seen as vacation destinations, but rather lands of 
opportunity.
    Our Energy Excelerator has capitalized on this opportunity 
to launch a unique program that was designed based on 
interviews with entrepreneurs. We asked them what they really 
needed to move their technology from the lab to the market. Our 
new model borrows the best from tech accelerators like Y 
Combinator which are designed for web and mobile technologies 
and the traditional grant process organizations like the 
Department of Energy to create the combined structure of Energy 
Excelerator.
    What are the best of each of these that we've picked?
    We've adopted the cohort aspect of Y Combinator with a 
major focus on peer to peer learning and from the Department of 
Energy we emulate significant technology funding of up to $1 
million needed to support technology commercialization along 
with an insistence on customer development and business models.
    A vibrant ecosystem is needed to sustain these business 
relationships. Our companies work and grow together and even 
stay together in one house in a kind of real world clean tech. 
It's created a family style community of clean energy startups. 
If you talk to any of our entrepreneurs they'll tell you that 
this feeling of Ohana is something that sets us apart.
    But there's one other thing that makes us different. We 
call it place centered innovation. We don't just pick the 15 
hottest energy companies each year. We pick the 15 most likely 
to transform the Hawaii energy system to help us integrate the 
next trench of solar, to fill gaps in our transportation 
system, to make buildings smarter and more efficient.
    This is really a systems approach to innovation. It is 
starting in Hawaii. But we believe it can be applied throughout 
the Nation and around the world in outreach and partnerships.
    So the question is does this work?
    Can we do 2 things at once?
    Immediately impact the success of clean energy startups and 
also transform the Hawaii energy system through place centered 
innovation?
    The jury is, frankly, still out. But early metrics are 
positive. Our companies have raised $55 million in follow on 
funding and created over 400 jobs.
    Over 1,000 startups have expressed interest in this program 
putting Hawaii on the map for investors and entrepreneurs 
around the world. So far we have raised nearly $35 million in 
public and private funding from for the Energy Excelerator from 
organizations such as the Department of Defense, Office of 
Naval Research, the Department of Energy, Hawaiian Electric 
Industries and others. We are just getting started.
    But time will tell this vision requires long term 
investment and commitment.
    While over 1,000 energy startups have expressed interest in 
the Energy Excelerator we have funded just 32. It is important 
to recognize that these companies come not just with ideas but 
often with millions of dollars of grant funding already 
invested in research. The government has invested significant 
resources in research and development for important 
technologies that have not yet made it to market.
    We designed Energy Excelerator specifically to get these 
companies across the gap that exists between the lab and 
commercial sales. We iterate and evolve our program 
continuously to better achieve this goal.
    Based on my personal experience in the Hawaiian Clean 
Energy Initiative and the Energy Excelerator innovative public/
private partnerships like ours, can be major catalysts to 
deploying sustainable clean energy technology while also 
playing a major role in addressing local challenges and 
creating a vibrant economy in the process. For all of here one 
of the deeply important elements of achieving our clean energy 
goals is the opportunity to create high quality jobs in a 
knowledge based economy, the types of jobs that our children 
will aspire to.
    I was encouraged to see the interns here today. I'm also 
happy to announce that we're launching an internship program 
with our companies to put interns in all of our clean energy 
startups. I think this is a really important piece of 
developing the next generation clean energy task force that can 
work productively with emerging technology.
    Finally, on a personal note I just want to say this has not 
been an easy road. We are embarking on a journey that is 
ambitious, risky and highly entrepreneurial.
    I'd also like to sincerely thank Senator Schatz and his 
staff, our Congressional delegation, this committee, our public 
and private partners and others in the community who have 
believed in this vision and help make it possible.
    Thank you.
    [The prepared statement of Ms. Lippert follows:]

  Prepared Statement of Dawn Lippert, Director, Energy Excelerator (a 
                    program of PICHTR), Honolulu, HI
    Aloha and thank you to Senator Schatz and this committee for the 
invitation to testify today. I'd like to take this opportunity to speak 
about the Energy Excelerator and what I believe it has taught us about 
the role of public-private partnerships in accelerating innovation.
Innovation in a Hawaii Context
    The Energy Excelerator, a program of Pacific International Center 
for High Technology Research, is a startup program designed to help 
energy innovation companies succeed, starting in Hawaii. Why starting 
in Hawaii? Seven years ago I was fortunate to join the analysis team 
drafting the Hawaii Clean Energy Initiative. It is a bold initiative to 
set the stage for energy transformation in Hawaii--from an economy 90 
percent dependent on oil to one powered by 70 percent clean, local 
energy. At the time, it would have been impossible to predict how 
powerful that was, and the accelerated momentum this state has seen 
toward clean energy and the role we've played as a model for other 
parts of the world. By many standards, we are making great strides 
toward that goal. Solar, for example, has increased 60-fold over the 
last few years. Eleven percent of Oahu households now have solar. This 
success has also led to challenges--it's not easy to integrate all of 
these new renewables onto our island grids. We now know that we 
actually can't reach the 70 percent clean energy goal unless we adopt 
new technologies and develop new approaches. This is where 
entrepreneurship becomes linked with the future of Hawaii--and where 
the Energy Excelerator comes in. Hawaii is now a fertile place for 
energy entrepreneurs; entrepreneurs like to go where the pain is 
highest and the urgency is most immediate. To energy entrepreneurs, 
Hawaii and other island nations are not seen as vacation destinations, 
but rather lands of opportunity.
Place-based Innovation
    Our Energy Excelerator organization has capitalized on this 
opportunity to launch a unique program that was designed based on 
interviews with entrepreneurs. We asked them what they really needed to 
move their technology from the lab to the market. Our new model borrows 
the best from tech accelerators like YCombinator, designed for web and 
mobile, and the traditional grant process of organizations like 
Department of Energy, to create the Energy Excelerator. What are the 
best of each that we've picked? We have adopted the cohort aspect of 
YCombinator, with a major focus on peer-to-peer learning, and from the 
Department of Energy, we emulate significant technology funding of up 
to $1 million needed to support commercialization, along with an 
insistence on customer development. A vibrant ecosystem is needed to 
sustain these business relationships. Our companies work and grow 
together, and even stay together in a kind of Real-World-Cleantech. 
It's created a family-style community of clean energy startups, and if 
you talk to any of our entrepreneurs, they'll tell you that this is 
something that sets us apart.
    But there is one other thing that makes us different. We call it 
``place-centered innovation.'' We don't just pick the 15 hottest energy 
companies each year. We pick the 15 most likely to transform the Hawaii 
energy system--to help us integrate the next tranche of solar, to fill 
gaps in our transportation system, to make buildings smarter and more 
efficient. This is a systems approach to innovation. It is starting in 
Hawaii but we believe it can be applied throughout the nation and 
around the world with outreach and partnerships.
How it's Worked So Far--Results
    So the question is--does this work? Can we do two things at once: 
1) meaningfully impact the success of clean energy startups and, 2) 
also transform the Hawaii energy system through ``place-centered 
innovation''? Early metrics are positive; our companies have raised $55 
million in follow-on funding and created over 400 jobs. Over 1000 
startups have expressed interest in the program, putting Hawaii on the 
map for entrepreneurs and investors around the world. So far we have 
raised nearly $35 million in public and private funding for the Energy 
Excelerator--from organizations such the Department of Defense's Office 
of Naval Research, the Department of Energy, Hawaiian Electric 
Industries, and others, and we're just getting started. But time will 
tell; this vision requires long-term investment and commitment.
    While over 1000 energy startups have expressed interest in the 
Energy Excelerator, we have funded 32. It is important to recognize 
that these companies come with not just ideas, but often with millions 
of dollars of grant funding already invested in research. The 
government has invested significant resources in research and 
development for important technologies that have not yet made it to 
market. We designed the Energy Excelerator specifically to get these 
companies across the gap that exists between the lab and commercial 
sales. We iterate and evolve our program continuously to better achieve 
this goal.
    Based on my experience in the Hawaii Clean Energy Initiative and 
the Energy Excelerator, innovative public-private partnerships like 
ours can be major catalysts to deploying sustainable energy technology, 
while also playing a major role in addressing local challenges--and 
creating a vibrant economy in the process. For all of us here, one of 
the deeply important elements of achieving our clean energy goals is 
the opportunity to create high quality jobs in a knowledge-based 
economy--the types of jobs that our children will aspire to.
In Closing
    On a personal note, I want to say that this has not been an easy 
road; we are embarking on a journey that is ambitious, risky, and 
highly entrepreneurial. And I would like to sincerely thank Senator 
Schatz and his staff, our Congressional delegation, this committee, our 
public and private partners, and others in the community who have 
believed in this vision and helped make it possible. Mahalo.

    Senator Schatz. Thank you very much.
    Ms. Meguro.

  STATEMENT OF WENDY MEGURO, ASSISTANT PROFESSOR, SUSTAINABLE 
 BUILDINGS AND COMMUNITY DESIGN, UNIVERSITY OF HAWAII, MANOA, 
SCHOOL OF ARCHITECTURE AND SEA GRANT COLLEGE PROGRAM, HONOLULU, 
                               HI

    Ms. Meguro. First I would like to thank you for this 
invitation to speak about sustainability challenges and 
opportunities in Hawaii and also to summarize some of the 
themes from our ASCENT conference yesterday.
    The overarching message that you mentioned in your 
introduction that I heard yesterday was that we have the 
knowledge. We have the technology to live sustainably here in 
Hawaii. Now we need the political will.
    As Vice President Al Gore said yesterday, political will is 
a renewable resource. So Senator Schatz, the people of Hawaii 
trust you to be the steward of that political will.
    The subject that I would like to focus on is green 
buildings, specifically managing the energy water nexus in the 
built environment.
    Here in Hawaii where our environment is our economy, 
buildings use over 25 percent of our energy. In addition the 
energy water nexus illustrates that the energy is used to 
transport and treat water and water is used in power plants to 
create our electricity.
    For example, the Board of Water Supply is one of Hawaiian 
electric company's largest customers.
    There are many aspects to green buildings but we chose to 
focus on efficiency in our session yesterday. Improving energy 
and water efficiency in buildings is one of the easiest and 
most cost effective ways to mitigate climate change to improve 
our local air and water quality and to reduce utility costs for 
consumers.
    So why focus on efficiency?
    It's estimated that a dollar spent on development of 
technology that improves the efficiency of building 
infrastructure is considerably worth $3 to $4 worth--spent on 
renewable energy technology.
    One successful example which has been cited multiple times 
today of Federal, State and private collaboration to address 
energy efficiency in buildings is the Hawaii Clean Energy 
Initiative.
    So I applaud the efforts so far. I also wanted to point out 
I think it's particularly useful because of its quantitative 
energy reduction targets and also specific recommended 
strategies. So I would like to emphasize those as we move into 
the future.
    I think we should continue to monitor our progress and 
communicate our updated recommendations for building energy 
efficiency to the public.
    In addition we should continue to foster advancements in 
energy saving building technologies and practices on the 
horizon.
    Next, I would like to discuss how policymakers might 
address some challenges and opportunities to reduce energy use 
in buildings.
    First, Hawaii's building energy and water codes are 
outdated. There's an opportunity to push for the adoption of 
current building energy and water codes by all counties. This 
also happens to align the HCEI recommendations. In parallel 
training on the new codes should be provided for building code 
inspectors and design professionals.
    Second, in Hawaii green building incentives do not yet 
reflect the caliber of a building's environmental benefit. 
Consider creating incentives for green building projects which 
are ratcheted to reward exemplary performance, particularly in 
water and energy savings. In addition, consider giving awards 
to recognize exceptionally high performance buildings and 
developments.
    Third, yesterday we talked in the opening session about 
acceptable return on investments. The question came up the ROI 
of what? What are we measuring?
    Higher first costs can discourage building owners from 
implementing energy efficient practices or technologies. We 
need to have adequate construction budgets or without that, 
provide financial incentives to offset those higher first 
costs. The goal is to be able to recognize and assess the 
quantity of value associated with water and greenhouse gas 
emission savings, reduce demands on municipal infrastructure 
and improved occupant health.
    In a commercial building the ratio of first cost to 
operating cost to personnel cost is about 1 to 5 to 200. So 
this highlights the economic benefit that green buildings 
provide occupants in terms of day lighting, high indoor air 
quality, control over one's comfort.
    Moving on to the subject of water and buildings.
    Challenges in Hawaii include maintaining our sustainable 
water supply and also reducing greenhouse gas emissions from 
water transport and treatment. Moderate water savings have been 
achieved already which, I applaud, using green building rating 
systems for both fleet buildings and for schools.
    I think this is a great start. But Hawaii has not yet 
seized the opportunity to save water and energy by capturing 
and using non potable water, onsite, in large scale buildings. 
Potable water is defined as suitable for human consumption and 
we typically do not need potable water to flush our toilets, to 
irrigate and to send to our cooling towers. So there's an 
opportunity here to match water quality with its appropriate 
use.
    We have multiple sources of water in a building which can 
be captured, treated and used onsite including green water, 
grey water, black water, cooling tower blow down, air 
conditioning condensate, etcetera. Multiple of our Hawaii based 
plans already encourage Hawaii or Hawaii to recycle and use non 
potable water including the Hawaii 2050 Sustainability Plan, 
the Hawaii Green Business Guide and the Hawaii Water 
Conservation Plan. So why aren't we on board yet or why don't 
we have these big projects yet?
    I would suggest that you consider initiating pilot projects 
with onsite water treatment and non potable water use in a 
large scale building or district. Relevant stakeholders to 
include in the conversation include the State Building Code 
Council, the Public Utilities Commission, the Board of Water 
Supply, the Department of Health, Worker's Unions and 
individuals who have already been involved in our non potable 
water workshops series. Pilot projects would establish a 
processes for permitting and inspection as well as training for 
code officials, designers and laborers.
    In addition, consider a study to quantify the potential 
energy and economic benefits of distributive water treatments 
verses the traditional centralized municipal water system. This 
might be timely considering the upcoming municipal water 
treatment plant upgrades that are required by the EPA.
    I appreciate your time and look forward to discussion.
    [The prepared statement of Ms. Meguro follows:]

 Prepared Statement of Wendy Meguro, Assistant Professor, Sustainable 
Buildings and Community Design, University of Hawaii, Manoa, School of 
        Architecture and Sea Grant College Program, Honolulu, HI
    I would like to thank you for the invitation to speak about 
sustainability challenges and opportunities in Hawai`i, and to 
summarize themes from the Ascent conference on April 15th.
    The subject I would like to focus on is ``green buildings,'' 
specifically, managing the energy-water nexus in the built environment. 
Here in Hawai`i, where the environment is the economy, buildings use 
over 25 percent of our energy. (Energy Information Administration) Most 
of that energy generation relies on imported fossil fuels and 
contributes to climate change. In addition, the energy-water nexus 
illustrates that energy is used to transport and treat water, and water 
is used in power plants to create energy. The Board of Water Supply is 
one of Hawaiian Electric Company's largest customers.
    Improving energy and water efficiency in buildings is one of the 
easiest and most cost effective ways to mitigate climate change, 
improve our local air and water quality, and reduce utility costs for 
consumers. Why focus on efficiency? It is estimated that $1 spent on 
the development of technology that improves the efficiency of building 
and transportation infrastructure is conservatively worth $3-4 (likely 
as high as $8-10) spent on renewable energy technology (Lawrence 
Berkeley National Laboratory).
    A successful example of a federal, state, and private collaboration 
to address energy efficiency in buildings is the Hawai`i Clean Energy 
Initiative (HCEI). One of its goals is to reduce energy use by 30 
percent by 2030 through efficiency and conservation (not including 
renewable energy). HCEI is especially useful because it has 
quantitative energy reduction targets and specific recommended 
strategies. We should continue to monitor our progress and communicate 
updated recommendations to the public. In addition, we should continue 
to foster advancements in energy-saving building technologies and 
practices.
    Next, I would like to discuss how policy-makers may address some 
challenges and opportunities to reduce energy use in buildings.
    First, Hawai`i's building energy codes are outdated. There is an 
opportunity to push for the adoption of current building energy codes 
by all counties. This also happens to align with HCEI recommendations. 
In parallel, training on the new codes should be provided for building 
code inspectors and design professionals.
    Second, in Hawai`i, green building incentives do not reflect the 
caliber of the building's environmental benefit. Consider creating 
incentives for green building projects which are ratcheted to reward 
exemplary performance, particularly in water and energy savings.
    Third, higher first costs can discourage building owners from 
implementing energy efficient practices and technologies. We need to 
have adequate construction budgets or provide financial incentives to 
offset higher first costs. The goal is to recognize and value the 
associated water and greenhouse gas emissions savings, reduced demands 
on municipal infrastructure, and improved occupant health. In a 
commercial building, the ratio of first costs to operating costs to 
personnel costs is about 1: 5: 200. (The Long Term Costs of Owning and 
Using Buildings, The Royal Academy of Engineering) This highlights the 
economic benefit of high performance buildings that provide occupants 
with daylight, high indoor air quality, and control over one's comfort.
    On the subject of water and buildings, challenges in Hawai`i 
include maintaining a sustainable water supply and reducing the 
greenhouse gas emissions from water transport and treatment. Moderate 
water savings have been achieved by using green building rating systems 
in State buildings and schools. (Lead by Example and Collaborative for 
High Performance Schools)
    This is a good start, but Hawai`i has not yet seized the 
opportunity to save water and energy by capturing and using non-potable 
water on-site in large scale buildings. Potable water is defined as 
suitable for human consumption, and we typically do not need potable 
water to flush our toilets, irrigate, or use in cooling towers. There 
is an opportunity is to match water quality and its appropriate use.
    A building has multiple water resources which can be captured, 
treated, and used, including rainwater; greywater from sinks, showers, 
laundry; blackwater from water closets; cooling tower blow down; air 
conditioning condensate; pool filter back flush; and more. Multiple 
Hawai`i-based plans encourage water recycling or non-potable water use, 
including the Hawai`i 2050 Sustainability Plan, the Hawai`i Green 
Business Guide, and the Hawai`i Water Conservation Plan.
    Consider initiating pilot projects with on-site water treatment and 
non-potable water use in a large-scale building or district. Relevant 
stakeholders include the State Building Code Council, the Board of 
Water Supply, and the Department of Health, workers unions, and 
individuals involved in the existing non-potable water workshop series. 
Pilot projects would establish processes for permitting and inspection 
as well as training for code officials, designers and laborers. In 
addition, a study is recommended to quantify the potential energy and 
economic benefits of distributed water treatment versus the traditional 
municipal water system. It is timely considering upcoming municipal 
water treatment plant upgrades are required by the EPA.
    I appreciate your time and welcome discussion.

    Senator Schatz. Thank you very much.
    Mr. Rue.

     STATEMENT OF HARRISON RUE, COMMUNITY BUILDING AND TOD 
   ADMINISTRATOR, CITY AND COUNTY OF HOLOLULU, DEPARTMENT OF 
             PLANNING AND PERMITTING, HONOLULU, HI

    Mr. Rue. Senator Schatz, thank you so much for the 
opportunity to testify today. But first I do have to say how 
delighted I was to hear the testimony of the gentleman from 
Roosevelt. My son graduated Roosevelt a dozen years ago and go, 
Rough Riders. That's all I have to say.
    [Laughter.]
    Mr. Rue. Great testimony.
    I'd like to talk about the City and County of Honolulu's 
Community Building and Transit-Oriented Development program and 
offer some suggestions on what Federal agencies and Congress 
can do to support local actions in sustainable community design 
or transportation. These also highlight some of the discussions 
in our community design panel at yesterday's ASCENT conference.
    I would like to also to thank you for your support for the 
conference and for your--yesterday.
    The TOD program is a community based program planning 
effort to help revitalize neighborhoods, increase 
transportation and housing choices and create more livable 
neighborhoods around the city's 20 mile rail transit system now 
under construction. We've developed neighborhood TOD plans for 
two-thirds of the 21 stations so far. We're updating land use 
ordinances and overlay zoning to require operable mixed use 
development.
    While we have big plans, policies and projects, we need to 
remember this is really about people and their neighborhoods 
and how we can connect families with jobs, housing, gathering 
spaces and each other. It's not an infrastructure project.
    The city's new TOD subcabinet is a working group of 
department directors modeled on the HUD, DOT, EPA Sustainable 
Communities Partnership. We meet weekly to identify and solve 
obstacles, address feasibility infrastructure availability, 
coordinate strategies and budgets and act together on 
collaborative projects. The TOD team works effectively with 
outside partners including several State agencies, land owners 
and developers and non profits and allied organizations.
    Other work underway include a proposed bike share system to 
reduce parking standards, new complete street standards, 
protected bike lanes and updated housing strategy and a TOD 
financial tool kit. This work will increase transportation 
choice access and safety, reduce energy use and emissions, by 
the way, that may be some of the missing things that are not in 
the HTI plan, a good percentage can come in there, folks, help 
protect water resources through compact development and green 
infrastructure and improve human and environmental health.
    To support these ongoing activities and partnerships we 
suggest that the Federal Government consider the following 
options most of which can be done with an existing authority 
and not asking for new money.
    We suggest replicating and expanding the successful 
interagency coordination programs like the HUD, DOT, EPA, 
Sustainable Communities Partnership. This is an excellent 
combination of funding, technical assistance that encourages 
innovation, collaboration and performance monitoring.
    I was just talking with one of the former directors 
yesterday who was at the conference. She noted that it has 
touched one third of the U.S. population in various programs.
    There's a strong need for continued technical assistance to 
the hundreds of existing grantees, expanded guidance and 
training materials based on lessons learned and most 
importantly corporation partnerships, principles and 
collaborative approach in the conventional statutory funding 
and regulatory programs.
    We also suggest that expanding this interagency approach to 
address broader issues using a variety of funding streams 
across other different agencies. One way to consider, you know, 
streamlined performance would be to use, it sounds simple, but 
just using the reporting and public involvement requirements 
for the single, cognizant agency much like when we received 
Federal grants. Only one cognizant agency is bonded to those 
grants. So you could actually rather than have 4 different 
agencies, environmental justice and public participation 
requirements just follow one of them.
    We suggest rewarding local efforts to strengthen 
interagency coordination and targeted budgeting for our areas 
much like the Federal partnership. The--our TOD subcabinet, 
that I noted, has the records of all relevant departments 
meeting weekly to coordinate, and prioritize projects and move 
them forward. Suggest maybe making such local coordination a 
consideration for demonstrating potential for follow through 
and grant making.
    We're also suggesting leveraging existing and future 
funding toward more integrated resilience efforts. Statutory 
programs tend to produce the same kinds of projects each year. 
Reallocating a larger percentage of existing, available funding 
toward innovative, local projects, such as DOD Tiger grant 
program, would require proof that investments will cost 
effectively meet multimodal, environmental and safety 
performance codes.
    We also suggest adjusting the MAP 21 rules in future 
reauthorization legislation to require a more sustainable 
performance measures that address broader community goals and 
link land use, community design, health, safety, equity and 
environmental sustainability.
    Not only do we encourage agencies like EPA to continue 
stepping out of their regulatory framework to work 
cooperatively with local and State governments to develop more 
cost effective, long term solutions to rain water and waste 
water issues.
    Green infrastructure can do an equal or better job of 
protecting watersheds while supporting other sustainability 
goals like compact development, transportation, housing choice 
to reduce energy use.
    Thank you again for the opportunity to testify. We 
appreciate the committee's willingness to conduct this hearing 
and to work on these critical issues.
    [The prepared statement of Mr. Rue follows:]

    Prepared Statement of Harrison Rue, Community Building and TOD 
Administrator, City and County of Honolulu, Department of Planning and 
                        Permitting, Honolulu, HI
    Thank you so much for the opportunity to testify today. In addition 
to briefly summarizing the City and County of Honolulu's Transit 
Oriented Development Program, my testimony will focus on what federal 
agencies and Congress can do to support state and local actions in 
sustainable community design and transportation initiatives.
    The City and County of Honolulu's TOD Program is a community-based 
planning effort to help revitalize neighborhoods, increase 
transportation and housing choices, and create more livable communities 
around the City's 21 rapid transit rail stations. After four decades of 
heated discussion, public opinion, political support, and financial 
capacity have aligned to begin construction of The Honolulu Rail 
Transit Project, a 20-mile high capacity transit system that will 
connect families with jobs, housing, gathering spaces, and each other. 
Together with public and private partners, the TOD Program is turning 
the focus toward using the transit investment to enhance and revitalize 
neighborhoods. The TOD team has developed Neighborhood TOD Plans for 2/
3 of the 21 stations, with the remainder under way. The City is 
updating land use ordinances and developing overlay zoning to encourage 
walkable, mixed-use development.
    Our implementation strategy is intended to catalyze development 
opportunities, infrastructure investments, and neighborhood 
enhancements around the rail stations. The City's new TOD Sub-cabinet 
is a working group of infrastructure, transportation, environmental, 
housing, and planning directors who meet weekly to focus inter-agency 
efforts on expediting catalytic projects in the TOD areas, with a focus 
on feasibility, infrastructure availability, market interest, and 
ability to leverage other investments. This approach is modeled on the 
success of the HUD-DOT-EPA Sustainable Communities Partnership. The 
subcabinet meets weekly to identify and solve obstacles, facilitate 
development, coordinate strategies and budgets, and act together on 
catalytic projects. The TOD team also works effectively with outside 
partners including state and federal agencies, landowners and 
developers, and non-profits and allied organizations including union 
and construction industry partnerships. Related efforts include a 
proposed bikeshare system, reduced parking standards, new complete 
streets polices and standards, protected bike lanes, and a TOD 
financial toolkit. Together, these plans, policies, and projects will 
increase transportation choice, access, and safety; reduce energy use 
and emissions; help protect water resources through compact development 
and green infrastructure; connect people with jobs and businesses with 
customers; and improve human and environmental health.
    We have been working with several State agencies on TOD-related 
issues, including the Department of Education (potential redevelopment 
opportunities and school access); Department of Health (potential bike 
share system and environmental/brownfields issues); Department of 
Accounting and General Services (potential State facilities and 
projects in TOD areas); Department of Planning (TOD planning and 
policy); Department of Hawaiian Home Lands (East Kapolei, Kalihi and 
downtown TOD plans); HCDA (Downtown and East Kapolei Plans, and 
mobility and infrastructure improvements in Kakaako); HHFDC (housing 
policy and project finance); Hawaii Public Housing Authority (Kalihi 
and Downtown TOD plans); DLNR (development of the East Kapolei TOD 
Plan); and the University of Hawaii system (West Oahu, Leeward 
Community College, and Honolulu Community College campuses and long-
term redevelopment potential). We have initiated the Airport 
Neighborhood TOD Plan, and will be working closely with the Hawaii 
Department of Transportation on that plan, as well as transit station 
access and safety improvements for the station areas along Farrington 
and Kamehameha highways.
    To support these ongoing activities and partnerships, we suggest 
that the federal government consider the following options:

   Replicate and expand successful interagency coordination 
        programs like the HUD-DOT-EPA Sustainable Communities 
        Partnership. These have worked exceptionally well to encourage 
        innovation at the local and state level. They are an excellent 
        combination of funding and technical assistance that encourages 
        innovation, collaboration and performance monitoring. These 
        included HUD's regional planning and community challenge grants 
        (which Honolulu received), DOT's TIGER grants, and EPA's robust 
        technical assistance and research. Many of these included 
        adaptation and resilience strategies for transportation, water, 
        energy and infrastructure. There is a strong need for 1) 
        continued technical assistance to the hundreds of existing 
        grantees; 2) expanded guidance and training materials for other 
        interested local government partnerships based on lessons 
        learned to date; and 3) incorporation of the Partnership's 
        principles and collaborative approach into conventional and 
        statutory funding and regulatory programs.
   This interagency approach could be expanded on to encourage 
        more integrated resilience strategies that address multiple 
        infrastructure issues and utilize a variety of funding streams 
        across different agencies. While it can be more difficult to 
        `complicate' grant-making and reporting this way, the 
        government should consider ways to streamline grantmaking and 
        reporting when coordinating funding awards, such as using the 
        reporting and public involvement requirements of a single 
        cognizant agency (much like the approach to using a single 
        cognizant agency's requirements in auditing funding).
   Encourage local efforts to develop more integrated 
        resilience solutions by rewarding local and state efforts to 
        strengthen interagency coordination and targeted budgeting 
        priorities, much like the HUD-DOT-EPA Partnership. One example 
        of this is the City and County of Honolulu's TOD Sub-cabinet, 
        which has directors of all infrastructure, planning, 
        environmental, transportation, economic development, 
        operations, and housing departments meet weekly to coordinate 
        and prioritize projects in neighborhoods along the city's 20-
        mile rail transit project (now under construction). Such local 
        coordination could potentially be a consideration for 
        demonstrating potential for follow-through in grantmaking.
   Provide more opportunities to leverage existing funding 
        toward integrated resilience efforts (in addition to developing 
        new funding streams). Much of the existing funding in 
        transportation, housing, water, energy, and environmental 
        programs is statutory in nature, and goes through older 
        programs and existing agency structures at federal, state, and 
        local levels. Re-allocating a larger percentage of available 
        funding toward more innovative programs that can go directly to 
        local integrated projects, such as DOT's TIGER grant program, 
        would help advance and prove the results of innovation. 
        Statutory formula funds tend to produce the same kinds of 
        projects each year; innovation-driven programs like TIGER 
        require proof that investments will cost-effectively meet 
        multimodal, environmental, and safety performance goals.
   Adjust the MAP-21 rules and future Reauthorization 
        legislation to encourage/require performance measures that 
        address broader community goals that link land use, community 
        design, health, safety, equity, and environmental 
        sustainability.
   Encourage agencies like EPA to step out of their regulatory 
        framework to work cooperatively with local and state 
        governments to develop more cost-effective long-term solutions 
        to stormwater issues that do an equal or better job of 
        protecting watersheds, while supporting other sustainability 
        goals like compact development, transportation and housing 
        choice, and reduced energy use. Include training, technical 
        assistance and funding support for revising local and state 
        codes and standards to allow/encourage/require green 
        infrastructure and resilience solutions.

    Thank you again for the opportunity to testify; we appreciate the 
committee's willingness to conduct this field hearing and to work on 
these critical issues.

    Senator Schatz. Thank you, Mr. Rue.
    Mr. Tam.

STATEMENT OF WILLIAM M. TAM, DEPUTY DIRECTOR, HAWAII COMMISSION 
  ON WATER RESOURCE MANAGEMENT (CWRM), DEPARTMENT OF LAND AND 
             NATURAL RESOURCES (DLNR), HONOLULU, HI

    Mr. Tam. Thank you, Senator Schatz.
    First we'd like to thank you for your introduction of the 
Secure Water Act of 2014 which will allow the State of Hawaii 
to compete for grants, water smart grants, water efficiency, 
water optimization, VUE grants and advance water treatment 
demonstration projects. We think this is an important addition 
to our ability to be nubile in the future.
    We'd also encourage you to pay attention to the decline in 
the number of stream gauges and the monitoring wells which are 
important in Hawaii. Both have suffered from lack of funding. 
We think these are critical. If you are a patient that's 
concerned about being healthy you do not want to take the 
monitor away when you most need it.
    In Hawaii all the water is local. Water and energy have a 
very interesting combination, but they move in different ways. 
Water is heavier, obviously. It can't be moved around in the 
same way energy can be. So it's important to look at the cost 
effects of that as we go forward.
    The World Economic Global Risks 2014 identified water 
prices and the failure of climate change. Mitigation adaptation 
is the third and fifth, respectively in its ranking order of 
the 10 global risks of highest concern in 2014. They considered 
these risks to have a high likelihood and a high impact, unlike 
the proverbial black swan which has low probability, but high 
impact. The climate change issues coming before us are both 
high impact and high probability.
    So this is a gale force wind that is coming toward us. As 
Nainoa Thompson reminded us yesterday, you're building a canoe 
to sail around the world you don't plan for the sunny afternoon 
offshore, you plan for the gale force winds and the low tide 
channels in 15 foot seas at night. So the question is is the--
are the lashings correctly done. Is the crew ready? Because 
when a voyage goes around the world, one bad night and the 
voyage is over.
    So as we design our climate change adaptation and 
resilience, we need to take into account that that's what we 
have to look for.
    Economics is very important. I'm going to talk about that 
in just a moment. The goal of the journey is to get there. It's 
not to do an accounting, necessarily, where we meet and 
auditors report, although those things have their place.
    So when we think about these issues we could do something 
that's cheap. But I think what we have to look at is what is 
the black swan of a major event? What happens if Fukushima 
earthquakes 1,000 miles South comes at us from the Southwest on 
Oahu, hits the--power plant, takes out--and Honolulu. It takes 
out Sand Island wastewater treatment plant. The harbors and our 
airports are hit.
    What do you do to build a future when that is a 
possibility? There's a huge earthquake. The Pacific is a rich 
area in seismic events. We need to think about how to build 
those resiliencies into our system which suggests that local, 
distributed and simple--systems that are in a community and 
that's a new way of doing things.
    With the model we've built from the 50s and 60s was good 
for that time. But we're now faced with a different set of 
circumstances. So we need to think about how to build 
resistance and duplication into our systems.
    To give you a simple example of what Hermina eluded to 
earlier about the cost of water and what some of the savings 
might be. Rural water supply was an issue yesterday spends 
about $28 million, $26 million for 87 million kilowatt/hours 
pumping 43 million gallons a day which is about $187,500 to 
pump 1 million gallons for a year. That's on the front side of 
the water cycle.
    On the back side of the water cycle environmental services 
pumps--or costs about--spends about $24 million to pump 74 
million, I'm sorry. It used to be 74 million kilowatt/hours for 
about 100 million gallons. That's about $244,000 a year to pump 
1 million gallons of sewage.
    So combined the electrical costs alone to move a million 
gallons of water is $431,500 a year. That's not including--on 
top of expenses or disrupted--of electricity.
    You can buy down a million gallons per day of water savings 
through conservation activities in the agricultural areas and 
the other areas. So that's where--that's a line we can start to 
look at.
    Senator Schatz. You said $430 odd thousand a year per 
million?
    Mr. Tam. Per million gallons of water.
    Senator Schatz. How many gallons are we moving?
    Mr. Tam. That's the average for one million gallons to be 
pumped out of the ground, transferred to your home, transferred 
to the wastewater treatment facility and then moved 2 miles 
offshore off Sand Island or Honolulu.
    Senator Schatz. Wait. But how many gallons are we moving on 
Oahu annually?
    Mr. Tam. Annually? I don't know the aggregate, but we're 
moving about 144 million gallons are being pumped daily from 
the foreign water supplies. So that's probably a good 
surrogate.
    These are for the Oahu system. We can get you that data.
    Mr. Tam. But it could take Oahu, the most popular island 
where you have a more centralized system that's probably a good 
number.
    There's about a hundred million gallons going out into the 
water into the ocean. As Gary Hill indicated yesterday, waste 
water is simply water or it could be waste. There's things we 
put into it, we can simply take those things out.
    There's methane. There's phosphates. There's a lot of 
things to be taken out. Those are separate income streams that, 
properly organized, could then become actually a way to reduce 
your overall costs.
    So the point of it is conservation is, as been indicated, 
is the single most cost effective way to deal with water 
energy. There have been studies by--at this University over the 
last 15 or 20 years. This is not new information. Looking at 
the cost benefit of investing in watershed manifers as a way of 
increasing supply while the technical aspects of that would 
require looking at their papers, essentially if you have a 
choice between building a new well which is going to move 
motors when down further and requires more and more pipelines 
or managing the watershed which then can capture more of that 
rainfall, put it back into the ground. That's the real supply 
side economics.
    That's where you're actually increasing, for example an 
aquifer from say, 10 million gallons to 12 million. You still 
use your existing infrastructure to take on one, as opposed to 
building a well and take out one more of a $10 mine. So the 
watershed management has multiple benefits aside from what just 
happens on the surface.
    Aside from the fact they're hiring young people to go out 
and work in the natural resources. You're actually increasing 
your supply. As the indications are often to climate--the 
university and elsewhere the rainfall pattern around the 
Hawaiian Islands are indicating that the clouds that fit the 
windward side of the mountains where you have to--our water are 
getting thinner both pressure down and pressure up from the 
heat. Therefore the amount of water hitting the mountains which 
is the source of our rainfall that caused a thinner--that cost 
more and more money.
    USGS indicates that in the last 80 years primarily from the 
1940s to the present that aggregate stream flows now 20 to 22 
percent aggregate rainfall just in the last 30 years it's down 
10 to 12 percent. If those patterns continue we're going to 
have less water in the streams, less water in the ground. To 
take advantage of what we can do in the forests, bring back 
native plants, cut down the invasive because as this happens, 
by the way, the invasives move up. Invasives are now taking 
over our forests.
    That trend is very dangerous because they have high, rapid 
transpiration rates. They do not put the water back in the 
ground. The Strawberry Guava throughout the islands, that is 
going to--that is really more and more mountain. If you talk to 
Senator Ruderman and--observed in his lifetime different kinds 
of weeds and invasives that he saw--topography. That's 
happening everywhere.
    So those phenomenon while not by themselves spectacular, in 
the aggregate have a major impact on our water supply.
    We would encourage you to look at conservation measures 
just as a cost efficient method to do this.
    The last thing I would like to say is that water integrates 
Ag, waste water use, water for consumption and the energy costs 
so that it integrates this in ways that others things do not. 
So saving water distribution is a way of paying down other 
costs and allowing greater efficiencies.
    The last point I guess I would make would be that we've 
dealt with this on a regional basis. If we do, simply do this 
on a bilateral contract basis we will not have the 
efficiencies. So we're going to do waste water management, 
central water, for example, there would be savings in different 
places. But we need to figure out a way to allocate those 
savings and allocate those budgets in a way so everybody gets 
to play.
    I would encourage you to look at the work that the Army is 
doing at Schofield Air--and should be a model for the rest of 
this----
    Thank you for your time.
    [The prepared statement of Mr. Tam follows:]

     Prepared Statement of William M. Tam, Deputy Director, Hawaii 
Commission on Water Resource Management, Department of Land and Natural 
                     Resources (DLNR), Honolulu, HI
    Aloha,
    On behalf of the Hawaii Department of Land and Natural Resources 
and the State Commission on Water Resource Management, thank you for 
inviting us to speak with you about Successes and Challenges in Meeting 
Sustainability Goals for Water in Hawaii.\1\
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    \1\ The Hawaii Commission on Water Resources Management website 
http://dlnr.hawaii.gov/cwrm/ provides extensive information about the 
Commission's work and links to many primary and secondary sources.
---------------------------------------------------------------------------
    My name is William Tam. I am Deputy Director, Commission on Water 
Resource Management (``Commission''), Hawaii Department of Land and 
Natural Resources.
I. INTRODUCTION
    The Hawaii State Constitution (article XI, Sec. 7) (1978) and the 
State Water Code (Haw. Rev. Stat. chap 174C) (1987) charge the State 
with a dual mandate: provide for reasonable and beneficial uses of 
water and protect public trust water resources for this and for future 
generations. Integrating reasonable and beneficial uses and long term 
resource protection requires sustainable water supplies.
    The challenge of climate change to Hawaii's water resources will 
alter how we manage our natural resources-and ourselves--for decades to 
come. This is an epochal change and a fundamental shift to a new 
paradigm. The hard path of big supply projects will no longer meet our 
needs. Not only will the infrastructure change. The way we use water 
will change. In some areas, we are approaching ``peak water.'' So 
different water qualities will be needed to satisfy different kinds of 
demand. And it will be more decentralized and distributed because the 
cost of energy will require it. It is time for a twenty-first century 
water policy?\2\
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    \2\ Juliet Christian-Smith and Peter Gleick, A Twenty-First Century 
U.S. Water Policy, Oxford University Press (2012)
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II. CLIMATE CHANGE
    The World Economic Forum Global Risks 2014 identified ``water 
crises'' and ``failure of climate change mitigation and adaptation'' as 
third and fifth, respectively, in its rank ordering of the ten global 
risks of highest concern in 2014.\3\ They considered the risks to have 
a high likelihood and to have a high impact. The report concluded that 
(1) trust is necessary if stakeholders are to work together; (2) long-
term thinking is a prerequisite to any approach to global risks; (3) 
collaborative multi-stakeholder action is required as no single entity 
has the tools and the authority to tackle systematic risks; and (4) new 
governance models are needed.
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    \3\ World Economic Forum Global Risks 2014 (www.weforum.org/risks)
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    In Hawaii, all water is local. Hawaii faces climate change-related 
impacts on our water resources different in kind from our sister states 
on the continental United States. Even dry states may (under certain 
circumstances) transport fresh water across state borders. Hawaii does 
not have that option. Each island is on its own when it comes to water. 
There is no Plan B to import or transport fresh water in life 
sustaining quantities. Each island must adapt to the uncertainties of 
climate change in its own way.
    The observed trends in climate change and projections of reduced 
future freshwater supplies make it imperative that Hawaii 1) 
aggressively pursue water conservation; 2) explore and expand the use 
of reused and reclaimed water; and 3) prepare for both persistent 
drought conditions (on the leeward sides of the islands) and less 
frequent, but larger rain events that run off quickly, fail to recharge 
the aquifers, transport soil onto near shore reefs; and 4) collect 
reliable hydrologic data to understand and monitor conditions in order 
to respond nimbly to new conditions.
    In the future, the leeward sides of all the major Hawaiian Islands 
are likely to be even drier. It is critical to collect and expand our 
collection of hydrologic data to refine future projections.
III. SECURE WATER AMENDMENTS ACT OF 2014 (S.2019): CONSERVING WATER 
        RESPOURCES; PROMOTING SUSTAINABILITY
    First, Senator, we would like to thank you for introducing the 
Secure Water Amendments Act of 2014 (S.2019). This Bill will allow 
Hawaii to compete for grants under the Department of Interior's 
WaterSMART Program, increase funding for drought projects, provide 
resources for better data collection and analysis of water supply. This 
will help Hawaii improve our water supplies' resiliency and 
sustainability. Hawai'i will become eligible for WaterSMART cost share 
Water and Energy Efficiency Grants, System Optimization Review Grants, 
Advanced Water Treatment and Pilot and Demonstration Project Grants, 
and Grants to Develop Climate Analysis Tools. Water resource 
stakeholders will be able to partner and collaborate with the 
Department of Interior.
    The four County departments of water supply, the County wastewater 
departments, the Commission on Water Resource Management, the 
Department of Land and Natural Resources, the University of Hawaii, the 
Department of Agriculture, the Department of Hawaiian Home Lands, and 
other water-related entities will benefit from this legislation.
IV. WASTEWATER REUSE AND STORMWATER RECLAMATION
    Wastewater reuse and stormwater reclamation are growing rapidly 
(especially in the West) as communities realize that every part of the 
water cycle is valuable, just mislabeled.\4\ But large- scale 
wastewater reuse and stormwater reclamation are relatively new in 
Hawaii and not widely understood. As Hawaii's population and water 
demands grow and water supplies come under new pressures, wastewater 
reuse and stormwater capture will be key components in sustainable 
water resource management for non-potable needs.
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    \4\ ``Water Reuse: Potential for Expanding the Nation's Water 
Supply through Reuse of Municipal Wastewater,'' National Research 
Council, National Academy of Science (2012) (http://www.nap.edu)
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OPPORTUNITY AND CHALLENGE
    In 2008, the Hawaii Commission on Resources Management in 
partnership with the U.S. Bureau of Reclamation completed an appraisal-
level study of opportunities statewide for the large-scale stormwater 
reclamation. Of twenty opportunities identified statewide, stormwater 
reclamation and reuse at Wheeler Army Air Base and Schofield Barracks 
(Wheeler) was determined to have the most stakeholder support and 
greatest likelihood for success. A pilot project at Wheeler could 
potentially use a significant amount of existing infrastructure for 
collection, treatment, storage, and conveyance of stormwater. The idea 
is to collect stormwater from the approximately 190 acres of runway and 
impervious surfaces at Wheeler airfield, where average annual rainfall 
is 40 to 50 inches/ year. The Schofield Barracks Wastewater Treatment 
Facility (located at Wheeler) contains several unused clarifiers that 
could be used to treat and improve the stormwater quality. An unused 
pipeline extends from the Wheeler property to nine 1.8 million gallon 
(16.2 million gallon total) underground former oil storage reservoirs 
at Waikakalaua Fuel Annex. Waiahole Ditch, or a parallel pipeline in 
the ditch easement, could convey the stormwater to downstream 
irrigation users, which include agricultural lands, golf courses, and 
other green spaces. An extension of the pipeline would allow surplus 
stormwater to be used to recharge the Pearl Harbor Aquifer or, further 
makai, the Ewa Caprock Aquifer.
    Commission records indicate that over 25 million gallons per day of 
high-quality potable groundwater from the Wahiawa and Waipahu-Waiawa 
Aquifer System Areas are currently permitted for non-potable uses. If 
these non-potable uses could be converted to non-potable sources, high-
quality groundwater could be conserved for potable uses. In addition, 
development of this opportunity will help to meet Clean Water Act 
requirements. Currently, stormwater from Wheeler enters Waikele Stream, 
eventually discharging to the West Loch of Pearl Harbor. Both of these 
water bodies are identified as impaired on the Department of Health 
Sec. 303(d) list. Implementation of Total Maximum Daily Loads (TMDLs) 
to receiving waters by the Department of Health will eventually require 
a higher level of treatment for stormwater.\5\ The treatment required 
to comply with TMDLs will potentially offset the treatment required for 
other uses, particularly irrigation.
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    \5\ In September, 2012, EPA released is updated 2012 Guidelines for 
Water Reuse, U.S. EPA, EPA/600/R-12/6/18 (2012)
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    The State is currently investigating how non-potable water could be 
developed regionally in Central Oahu. Land use is in transition. With 
the decline of plantation agriculture, vast tracts of former sugarcane 
lands lie fallow. There are plans for increased agricultural activity 
in the Kunia Road corridor, expansion of military housing at U.S. Army 
Schofield Barracks, and proposals for new urban developments. There is 
significant non-potable water demand associated with each of these 
planned activities.
    There are also a number of sources of non-potable water in the 
Central Oahu. In addition to stormwater, 1) there are two wastewater 
treatment plants, Schofield and Wahiawa that are capable of producing 
R-1 water; 2) Lake Wilson, which has a current capacity of 2.5 billion 
gallons and a pass through stream flow estimated at 36 million gallons 
per day; 3) the Waiahole Ditch; 4) new wastewater treatment facilities 
associated with new developments; and 5) new re- sourcing treatment 
facilities that could divert and treat wastewater from existing 
pipelines near or on-site for landscaping or agricultural use (thereby 
saving energy costs of pumping water miles away to large treatment 
plants).
V. COORDINATE AND INTEGRATE WATER RESOURCE PLANNING ACROSS 
        JURISDICTIONS ON A LIFE-CYCLE, TRIPLE BOTTOM LINE BASIS
    There is a need for new, coordinated, and integrated water resource 
planning across jurisdictions, and on a life-cycle, triple bottom line 
basis.\6\. If water supply planning and implementation continue in a 
piecemeal fashion, the opportunity to partner and leverage resources 
may be lost. This may result in higher capital and operating costs, 
lost efficiencies, and unfavorable outcomes. By taking a regional 
approach and involving multiple stakeholders, there may be new 
economies in savings and avoided costs. Specifically, benefits and 
costs may be redistributed geographically or across time to enable an 
integrated plan to succeed where none of the component parts alone 
would start, let alone survive.
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    \6\ ``Triple Bottom Line'' refers to an accounting framework for 
sustainability that includes financial, social, and environmental 
measures (often referred to as People, Planet, and Profits). While the 
metrics for each may differ, projects may nonetheless be compared on 
each alone. This creates a mechanism to evaluate the ramifications of 
alternative decisions from a truly long term perspective much as a 
series of cash flows may be compared by reducing each to its present 
value.
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    For example, reusing wastewater in Central Oahu could reduce the 
size and capital costs to expand the planned secondary treatment 
facility at the Honouliuli Wastewater Treatment Plant. That could also 
reduce operations and energy costs to pump the wastewater to 
Honouliuli.
    Through a regional plan, there may be a combined benefit among 
entities that would not pencil out financially for any single party 
acting independently.
    Given the many interested stakeholders in the area, there is a need 
to engage all stakeholders--landowners, farmers, developers, the 
military, wastewater treatment plant operators, Board of Water Supply, 
Department of Health, and others in a collaborative planning effort 
that looks at all resources, all potential demand, and identifies 
solutions in the best interests of the community and the State. The 
Commission wants to ensure that water supply, wastewater, and 
stormwater planning in Central Oahu proceed in a way that can address 
these issues and concerns early in the process and to mitigate any 
foreseeable conflicts. The Commission is working to finish its non-
potable water planning in the fall, 2014.
    Pending completion of this work, developing and implementing a 
proof of concept pilot project is important to demonstrate the 
feasibility of stormwater reclamation and reuse and establish its 
viability, associated technical issues, costs and budget, and build 
support for the larger effort. This regional undertaking will require 
close working relationships among federal, state, county, and private 
parties. Above all, it will require leadership and innovation.
VI. FULL CYCLE ENERGY COSTS OF WATER
    The cost to pump groundwater, transport it to end users, move it 
again as sewage (by gravity piping and force mains) to wastewater 
treatment plants, remove the chemicals and solids, force it into long 
ocean outfalls, and comply with the Clean Water Act is expensive. While 
the energy costs of water are appreciated on the mainland,\7\ they have 
received little attention in Hawaii.
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    \7\ ``Implications of Future Water Supply Sources for Energy 
Demands,'' Heather Cooley (Pacific Institute) and Robert Wilkinson (UC 
Santa Barbara), WateReuse Research Foundation and Bureau of Reclamation 
(DOl) (2012); ``Energy Down the Drain- The Hidden Costs of California's 
Water Supply,'' NRDC and Pacific Institute (August 2004)
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    In the first 11 months of FY 2012, the Honolulu Board of Water 
Supply paid approximately $26.8 million for 87.9 million kilowatt hours 
to pump 143 million gallons I day for one year. That is about $187,500 
to pump one (1) mgd for one year.
    In FY 2013, the City and County of Honolulu Department of 
Environmental Services paid approximately $24.3 million for about 74 
million kilowatt hours to treat and pump about 99.4 mgd of sewage for a 
year. That is about $244,000 I year per one (1) mgd of sewage treated.
    Combined, the BWS and Environmental Services' energy cost to pump, 
transport, treat, and dispose of one mgd of water is about $431,500 /
year. And that is just the electrical costs. It does not include the 
capital, the infrastructure, the human labor, or the environmental 
costs. Imagine securing the service that potable water provides in a 
whole new way. Calculate the opportunity costs of leaving potable (and 
future drinking) water in the ground (the best reservoir there is- as 
Arizona's groundwater recharge project demonstrates) and not pumping 
(lower energy costs). But the overall plan may only succeed if this 
savings can be allocated and distributed to other regional parties on 
an overall cost efficient basis. There will simply not be enough bi-
lateral contracts to make the whole work. It requires a regional 
approach.
    It goes without saying that the Uniform Plumbing Code ("UPC") and 
International Green Construction Code (``IGCC''), as well as local 
county ordinances provide important institutional pathways to the day 
to day implementation of real conservation. It is through these 
retrofitting mechanisms that old (as well as new) infrastructure is 
realigned in more efficient directions. Ironically, the cost I benefit 
payback period for investing in many of these retrofits is often less 
than one year and it generates new work for skilled labor in small and 
medium sized operations. One perverse effect of rising energy costs is 
it makes investment and rapid changes in new efficiencies more 
economic.
VII. DROUGHT PLANNING, MITIGATION, AND RESPONSE
    The Commission is the lead agency for drought planning in Hawaii. 
The Hawaii Drought Council helps to coordinate drought mitigation and 
response activities across the state. In 2005, the Commission developed 
the Hawaii Drought Plan which led to working with drought stakeholders 
in each county to develop four County Drought Mitigation Strategies. 
The County Drought Mitigation Strategies identify projects to improve 
drought preparedness and resilience in the water supply; agriculture & 
commerce; and environment, public health and safety sectors.
    The Hawaii Water Resources Act of 2000 (P.L. 106-566, as amended) 
made Hawaii eligible for U.S. Department of Interior, Bureau of 
Reclamation programs for drought relief and drought planning. Hawaii 
was able to benefit from these programs during the droughts in the last 
decade through emergency drought assistance and planning assistance 
from the Bureau of Reclamation. The authority for emergency drought 
relief (Title I of P.L. 102-250, as amended) expired on September 30, 
2012. Reauthorization of this authority and appropriation of program 
funding could help stakeholders in Hawaii to better cope with drought.
    There are several federal agencies that offer programmatic 
assistance for drought mitigation and response, including U.S. 
Department of Interior's Bureau of Reclamation and U.S. Department of 
Agriculture's Natural Resources Conservation Service, Farm Service 
Agency, Rural Development Program and Risk Management Agency. The 
respective County Drought Mitigation Strategies have drought mitigation 
projects in need of funding sources and could qualify for one or more 
of the programs offered by these agencies, should funding opportunities 
become available.
    Hawaii also benefits from the work of the National Oceanic and 
Atmospheric Administration's National Integrated Drought Information 
System (NIDIS). Continued support for NIDIS is important for 
maintaining a drought early warning system and for delivering products, 
tools, resources and programs to assist drought stakeholders to prepare 
for and mitigate the impacts of drought across the country.
VIII. NEED FOR INCREASED CLIMATE AND HYDROLOGIC MONITORING AND RESEARCH
    Hawaii's climate is extremely diverse. Micro-climates are the rule 
rather than the exception. We have rainforests and deserts, alpine 
mountains and coastal plains. Annual precipitation can vary by more 
than 100 inches/year in a span of just a few miles. Rain gages and 
stream gages allow us to monitor trends in these elements over time. In 
order to get a clear picture of climate change, there needs to be 
monitoring with long periods of record and sufficient geographical 
coverage to represent our different climate regions across the state. 
The number of stream gages in Hawaii has declined from over 197 (1966) 
to only 59 in 2012. Rainfall stations have decreased from a peak of 
over 1000 in 1968 to around 340 in 2007. This decline in monitoring is 
leaving gaps in the data at a time when we need this long-term data the 
most.
    Stream gages operated by the U.S. Geological Survey are funded on a 
cost-share basis with cooperators, who are mainly state and county 
agencies. The recent fiscal crisis caused these cooperators to reduce 
funding for data collection resulting in the loss of important stream 
gaging stations. The National Weather Service administers a cooperative 
observer program in Hawaii, which comprises its volunteer rain gage 
network. Hawaii's sugar plantations were prolific rainfall observers. 
Since the plantations closed, the network of rainfall stations declined 
precipitously. It is important to re-establish both stream gages and 
rainfall stations in key climatic regions where there is a long period 
of record of observations. The continuation of hydrologic data 
collection and analysis is fundamental in monitoring how Hawaii's 
climate is changing and to ascertain the impacts of climate change on 
our water availability both now and in the future.
    Section 9506, Secure Water Act of 2009 establishes a Climate Change 
and Water Intergovernmental Panel in order to address the issue of data 
gaps in current water monitoring networks and how to improve data 
collection to better monitor and analyze water resources.
    Section 9507 of the Act authorizes the implementation of programs 
to enhance water data collection by the U.S. Geological Survey.
    Congress needs to appropriate sufficient funds to implement the 
provisions described above and for the U.S. Geological Survey in Hawaii 
to increase the number of stream gages in Hawaii, especially where 
critical, long-term stream gages have been discontinued.
    Congress also needs to appropriate fund to increase the number of 
Hawaiian rainfall stations and reestablish important rainfall stations 
with long periods of record through the Pacific Islands Climate Science 
Center or the University of Hawaii.
    Ensuring that hydrologic data collection continues in Hawaii is the 
only way to effectively monitor and analyze the impacts of climate 
change on our precious fresh water resources. This essential data set 
will benefit many sectors of the community--researchers and resource 
managers alike, including the University of Hawaii, U.S. Geological 
Survey, Hawaii Department of Land and Natural Resources, and many 
others.
IX. ACTIVE LEADERSIDP AND ENGAGEMENT ACROSS JURISDICTIONS
    The key is active leadership. Money and legislation may be slow and 
hard to secure. But getting people from all levels of government, 
across multiple functions, and in conjunction with private actors to 
sit down and talk with one another requires only active leadership and 
personal time. It is the human contact that opens the doors. We have 
the means to communicate with one another. It is not expensive. It just 
requires convening meetings or hearings (like this one) to highlight 
innovations, encourage collaboration, re-imagine smaller more dynamic 
on-site systems, and share opportunities.
Agency Collaboration
    Protect water resources through accelerated collaborative effort by 
City, State and Federal agencies.
            Planning
    Analyze true life cycle costs/value of water resources across 
jurisdictions, the full hydrologic cycle, and functions so that 
efficiencies and costs can be realized across multiple users. Compare 
alternative scenarios, including the cost of current course. Integrate 
energy costs into all water analysis. Integrate analysis and 
synchronize plans across all levels of government. Examine regulatory 
changes (practices and rules) needed to realize the proposals outlined 
here.
            Watershed protection
    Expand forest and agricultural public/private partnerships to 
combat invasive species, capture and enhance groundwater resources, 
restore native plants, and increase resilience to climate change.\8\ 
Prevent runoff and pollution in ahupua'a and watershed area across 
jurisdictions (using mauka to makai approach)
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    \8\ ``Natural Infrastructure- Investing in Forested Landscapes for 
Source Water Protection;'' World Resources Institute (2012).
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            Infrastructure improvements and controls
    Investigate and support treating wastewater to R-1 for reuse from 
state, county, federal, and private facilities. Capture and reclaim 
storm water, grey water, and rainwater to replace potable water use in 
urban and agricultural applications. Expand grading and agricultural 
soil conservation efforts. Increase efficiencies in agricultural 
irrigation practices. Decentralize and relocate new and renovated 
infrastructure away from coastlines
            Finance
    Explore ways to engage private funding sources.\9\ Insurance 
companies calculate risk and have good reason to search out risk 
reduction strategies. Develop new pricing structures. Publish combined 
water & energy triple bottom line accounting for all projects.
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    \9\ ``Financing Green Urban Infrastructure'' (OECD Regional 
Development Working Papers 2012/10; http://dc.doi .org/
10.17875k92p0c6j6ro-en); Creating Clean Water Cash Flows- Developing 
Private Markets of Green Stormwater Infrastructure in Philadelphia 
(NRDC January 2013; http://www.nrdc.org/water/stormwater/files/green-
infrastructure-pa-report.pdf)
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Multi-Agency Coordination Group
    Establish multi-agency coordination group with a specific mandate 
to analyze how to carry out the tasks described here (including how to 
engage private funding sources). Set a deadline to report back to this 
Committee in one year (May, 2015).
Mid-Course Corrections: Flexible, Adaptive, and Responsive
    Increasingly, water, energy, and natural resource problems combine 
in new and faster ways. Old, isolated approaches fail to capture the 
interaction or the complexity of problems, their solutions, or their 
urgency. We need more mid-course corrections. Institutions designed 20-
40 years ago need to work horizontally across jurisdictions and in near 
real time. Specifically, federal agencies (especially EPA and COE, but 
also USFWS and NOAA) need to get closer to the management problems and 
help States be flexible and more adaptive. Navigating requires regular 
mid-course corrections and quick feedback loops.
X. GOING FORWARD
    Climate change poses great uncertainties and risks to sustainable 
water supplies. Water conservation, development of non-potable 
alternatives, integrated actions across multiple jurisdictions, drought 
planning, and mixed public-private financing and watershed protection 
require direct active leadership and attention.
    Hawaii is developing a number of initiatives that are still in 
their early stages. We would appreciate the opportunity to provide the 
Subcommittee with a more detailed account of these activities. To that 
end, we request that the record in this matter be kept open until 
April30, 2014 to supplement the testimony provided here.
    Thank you for the opportunity to share our views. We look forward 
to working with this Subcommittee and our federal partners to achieve a 
sustainable water future for Hawaii.

    Senator Schatz. Thank you very much.
    Dr. Pauley.

STATEMENT OF STEPHEN M. PAULEY, MD, PRESIDENT, EDWIN W. PAULEY 
                    FOUNDATION, KETCHUM, ID

    Mr. Pauley. Thank you, Senator Schatz, for this opportunity 
to recommend that Coconut Island, Kane'ohe Bay, Oahu, Hawaii 
serve as a living example for sustainable systems that will 
stimulate the building and implementation of similar systems by 
others in the Hawaiian Islands, most of North America and the 
Pacific Rim.
    When Coconut Island was gifted to the University of Hawaii 
Foundation the Pauley intended that in addition to the green 
sciences already in place at HIMB, the Hawaii Institute of 
Marine Biology, that the island would become a model for 
sustainability. In my dedication speech in 1998, when I 
dedicated the island along with a newly built marine lab I said 
the following.
    ``If we can relate the first rate science being done at 
this new lab to improving ecosystems in this bay, the Hawaiian 
Islands and the Pacific Ocean, if we can make Coconut Island a 
model for sustainable living, if we can leave the comfort zone 
to our narrow disciplines to relate our science to others in 
the community, and to the diverse fields of humanities, of the 
humanities, if we can find the courage to shape public policy 
to improve our environment and if by doing these things we end 
up with a healthier ecosphere, through your efforts to 
reconnect people to the natural world, than our gifts to you in 
Hawaii will have real meaning, not only to our granddaughters, 
Hannah and Brooke.'' We have 2 more since then. ``But to our 
future set of generation.''
    That was in 1998. Hannah is now 17, 18 and ready to go to 
college. The point being, it's been a long time.
    [Laughter.]
    Mr. Pauley. Coconut Island long range development in 1998 
was drafted by 16 leaders from the University of Hawaii and 
surrounding communities, approved by the UH Board of Regents, 
co-chaired by then UH President Ken Mortimer and me.
    The mission statement reads, ``To promote the stewardship 
of the living oceans, restore, preserve and sustain marine 
ecosystems in Hawaii and the Pacific Rim to integrate 
scientific research, community involvement, education and 
example at Coconut Island.''
    Almost 16 years have passed and those goals have been 
minimally achieved. This has been a disappointment to the Board 
of Directors of the Pauley Foundation and the Pauley family. To 
many at UH who also see the potential for the island to serve 
as an example for sustainable systems that include the use of 
solar and wind energy, fresh water catchment, natural sewage 
treatment and the use of sustainable building materials.
    While first rate marine science is routinely conducted at 
HIMB the island's overall potential is still lacking. The 
reasons for the lack of concerted action are many, most are 
budget related. There has been a lack of continuity at UH. Four 
presidents have served UH over the past 16 years. There needs 
to be both a political and strategic will to adhere to the 
zoning of environmental sustainability emissions stated in the 
1998 Coconut Island long range development plan.
    Senator Schatz, you have firsthand knowledge of Coconut 
Island's potential. We both served on the Board of Directors 
for the Center for a Sustainable Future. The organization was 
founded by former dean of SOEST, Dr. Barry Raleigh.
    CSF was funded by private foundations and donors. We 
studied issues such as coastal pollution, coral beaching, 
reduced fish populations, aqua cultures and strategies for the 
use of biofuels to replace dependency on imported oil. We also 
studied other environmental problems in Hawaii and the Pacific 
Rim. But funding fell short when it came to implementing 
sustainable systems. CFS was disbanded when Dr. Raleigh retired 
as Dean of SOEST.
    So the specific request that I am making of the committee 
since we've been unable to achieve the progress on any other 
basis is to implement the Coconut Island master plan of 1998.
    No. 1, build sustainable energy, water and building system 
on the island so that the island can serve as an example of 
what to do correctly in the era of climate change, dependency 
on fossil fuels warming oceans and loss of coral reefs and 
fisheries.
    No. 2, build a conference center and visitor housing. This 
is all in the master plan. To bring together others in Hawaii 
and the Pacific Rim to study environmental issues such as food 
shortages, depleted fisheries, climate change and shoreline 
flooding. These are all issues obviously we all know about that 
threaten coastal communities.
    I thank you for this opportunity to state my views.
    [The prepared statement of Mr. Pauley follows:]

Prepared Statement of Stephen M. Pauley, MD, President, Edwin W. Pauley 
                        Foundation, Ketchum, ID
     Thank you Senator Schatz for this opportunity to recommend that 
Coconut Island, Kaneohe, Oahu, Hawaii, serve as a living example for 
sustainable systems that would stimulate the building and 
implementation of similar systems by others in the Hawaiian Islands, 
coastal North America, and the Pacific Rim.
    When Coconut Island was gifted to the University of Hawaii 
Foundation, the Pauley Foundation intended that in addition to the 
marine sciences already in place at the Hawaii Institute of Marine 
Biology (HIMB), that the island would become a model for 
sustainability.
    In my dedication speech in 1998, when I dedicated the island along 
with a newly built marine lab I said the following:

          ``If we can relate the first rate science being done at this 
        new lab to improving ecosystems in this bay, the Hawaiian 
        Islands & the Pacific Ocean; if we can make Coconut Island a 
        model for sustainable living; if we can leave the comfort zones 
        of our narrow disciplines to relate our science to others in 
        the community and to the diverse fields of the humanities; if 
        we can find the courage to shape public policy to improve our 
        environment, and if by doing these things we end up with a 
        healthier ecosphere through your efforts to re-connect people 
        to the natural world, then our gifts to you and Hawaii will 
        have real meaning not only to grand daughters Hannah and 
        Brooke, but to our future 7th generation.''

    The Coconut Island Long Range Development Plan of 1998 was drafted 
by 16 leaders from the University of Hawaii and surrounding 
communities, approved by the UH Board of Regents, and co chaired by 
then UH President Ken Mortimer and me. The Mission Statement reads:

          ``To promote the stewardship of the living oceans, restore, 
        preserve, and sustain marine ecosystems in Hawaii and the 
        Pacific Rim through integrated scientific research, community 
        involvement, education, and example at Coconut Island.'' ( 1998 
        Coconut Island Long Range Development Plan)

    Almost 16 years have passed and those goals have been minimally 
achieved. This has been a disappointment to the board of directors of 
the Pauley Foundation, to the Pauley family, and to many at UH who also 
see the potential for the island to serve as an example for sustainable 
systems that include the use of solar and wind energy, fresh water 
catchment, natural sewage treatment, and the use of sustainable 
building materials.
    While first rate marine science is routinely conducted at HIMB, the 
island's overall potential is still lacking. The reasons for lack of 
concerted action are many. Most are budget related. There has been a 
lack of continuity at UH; four presidents have served UH over the past 
16 yrs. There needs to be both a political and strategic will to adhere 
to the zoning and environmental sustainability missions stated in the 
1998 Coconut Island Long Range Development Plan.
    Senator Schatz, you have firsthand knowledge of Coconut Island's 
potential. We both served on the board of directors for the Center for 
a Sustainable Future (CSF). The organization was founded by former Dean 
of the School of Ocean Engineering Science and Technology (SOEST) at 
UH, Dr Barry Raliegh. CSF was funded by private foundations and donors. 
We studied issues such as coastal pollution, coral bleaching, reduced 
fish populations, aquaculture, strategies for the use of biofuels to 
replace dependency on imported oil, and other environmental problems in 
Hawaii and the Pacific Rim. But funding fell short when it came to 
implementing sustainable systems. CSF disbanded when Dr Raleigh retired 
as Dean of SOEST at the University.
Specific Request of this committee
    Congressional funding for Coconut Island is requested to implement 
the Coconut Island Master Plan of 1998:

    1) build sustainable energy, water, and building systems on Coconut 
Island, Kaneohe, Oahu so that the island can serve as an example of 
what to do correctly in the era of climate change, dependency on fossil 
fuels, warming oceans, and loss of coral reefs and fisheries;
    2) build a conference center and visitor housing to bring together 
others in Hawaii and the Pacific Rim to study environmental issues such 
as climate change, food shortages, depleted fisheries, and coastal 
flooding-- all issues that threaten coastal communities;

    Senator Schatz. Thank all of the testifiers. I do have a 
number of questions.
    I'll start with Mr. Tam and, I think, Ms. Meguro. This is a 
general question because you know that I understand the water 
and power nexus. What I am still needing help with is that 
because we have the old, physical infrastructure and old 
statutory, regulatory infrastructure and old ways of doing 
things, that, you know, I had a workshop 6 or 8 months ago 
where we talked about this.
    I have very capable staff. I have access to all kinds of 
experts. Yet, the question of how, exactly, to manifest the 
thinking that's expressed at this panel in terms of making sure 
that we make holistic decisions. There seems to still be a gap 
in terms of what changes, either at the regulatory or 
policymaking level, need to be made.
    I understand that projects can be done more intelligently. 
I understand that at the building level that people ought to be 
smarter about things.
    But given that, you have boards and departments of water 
supply and then you have electric utility companies and sort 
of, never the twain shall meet, except with the concept which 
is that utilities use a lot of water and electric utilities use 
a lot of water and then, of course, the water utilities use a 
lot of electricity. So it's all intuitive except that in terms 
of effectuating long term, holistic planning, it's not at all 
clear to me what kinds of changes at the policy level need to 
be made.
    Mr. Tam. Thank you, Senator.
    The first act is going to be an act of imagination because 
we have to understand how the water moves. Once you understand 
how the water moves, you've got to ask the question how might 
it move differently.
    I'll give you a simple example. If the Coal Rich project 
proceeds they will have to build, under current plans, a 
pipeline from the new facilities or new subdivision down to the 
transfer station and then over Honolulu-Uley. That pipeline 
alone is $40 million.
    If instead they were to be asked or if they chose to build 
an R1 facility so remembering our bio-rec facility, they could 
treat the water there to an R1 quality, use it on their lands, 
use it on adjacent lands, provide irrigation water that's non 
potable, for example, to the Patsy Mink Park which is right 
below that. Currently the border up supply pumps about a 
million gallons a day to irrigate potable water to irrigate 
land.
    If that could be done with R1 water you can save the 
potable water by pumping a million gallons a day. You could 
save----
    Senator Schatz. Would the county or State laws need to be 
changed in order for them to be able to do this?
    Mr. Tam. I don't think so. I think this is more an action 
of and I don't have a direct answer, maybe some type of 
biospecs, but I think it's more a decisionmaking across the 
groups. People might have to sit down and talk about it.
    Senator Schatz. But this would be the Land Use Commission 
requiring or the Department of Planning and Permitting do 
these?
    Mr. Tam. I don't think so. I think--and I defer to the sum 
of the county process. But I think it's more a matter of just 
figuring out the pathway forward and maybe some permitting 
requirements. It depends on each project.
    But I think in the first instance it's sitting down and 
getting a plan figured out among people who will be affected. 
But I just wanted to take this as an example. If you leave a 
million gallons in the ground which is your best reservoir, you 
don't have to pump it.
    Those savings are important. Now those savings will be 
realized primarily by the Board of Water Supply. The question 
is if you have a regional plan is can you reallocate those 
savings to some other part of the property so then you make 
cost efficiency work.
    Now the Board of Water Supply, of course, will tell you 
they've got to have all that savings. But if they're going to 
play with everybody else it's important that they shared some 
fraction to make other, less efficient parts of the plan work.
    Senator Schatz. Right. But it's not trivial to--and I 
understand you're giving me a specific example, but it's, sort 
of, not trivial at all that we're sitting here not clear 
whether we need changes in the law or not and not clear at all 
whether or not this is a question of leadership or a question 
of policy. I presume it's both.
    But it seems to me that we are, sort of, knocking around on 
this issue because it's so obviously the smart thing to do. 
Yet, the mechanics are not, you know, well articulated quite 
yet.
    Mr. Tam. I would make a suggestion and it's in my written 
testimony on this point, actually, that there be a coordinating 
committee organized between the mayor or the Governor with the 
relevant people involved and come back and report to this 
committee at the end of the year so we have a forcing mechanism 
and come back with those specific suggestions that would make a 
difference in those areas.
    I think that's--then we could get down to what the legal 
changes might have to be, what the purveying schemes are, but 
they vary by topography.
    For example, right now the Army Corps or rather the Army 
drew a contract and is working with aqua engineers to take all 
their own water. They use it for landscaping. People are going 
to move some R1 water to Kaneohe to some of the farmers down 
there. That would be a different kind of arrangement with the 
county.
    So there are specific permitting requirements. But I don't 
think we can give you that answer right now.
    Ms. Meguro. So I've been trying to chase down the same 
question in the last maybe, 6 months. I would say that answer 
is a little fuzzy. But I can tell you what I've learned so far.
    First, I think there is a body who has been looking into 
this, the U.S. Green Building Council, Hawaii Chapter, Advocacy 
Committee. They have been reviewing some of the plumbing codes 
for recommendation for adoption by the State and counties.
    So as I understand they are looking at both the 
international green construction code and the uniform plumbing 
code 2012 as potential overlays or for full adoption by the 
counties. I don't think that has come to a conclusion yet, in 
my understanding.
    Next, I was wondering if there was any hang up in the 
Department of Health, if for some reason their water quality 
standards that might be holding us back.
    My read of the codes so far, it looks like the Department 
of Health is willing to review design projects on a case by 
case basis and that that was not the hurdle. It sounds 
inefficient to, kind of, go on for every or review every design 
project on a case by case basis. But it was not the road block.
    One of the things that I did hear that is not necessarily a 
road block, but is definitely, slows us down, is a Hawaii 
Administrative Rule which requires building projects to hook 
up, pay to hook up to the sewer if it is available at your 
site. If you have a water treatment plant offsite or a system 
onsite that is sufficient for your building or set of 
buildings, then is it really necessary to pay to hook up to the 
sewer?
    So that's, I think, one challenge that design teams are 
facing.
    Thanks.
    Senator Schatz. Thank you very much.
    Chairman Morita.
    Ms. Morita. I just wanted to point out that I think a lot 
of the solutions to this is dealing with cultural changes 
within departments. Every department is so siloed. We need to 
pick up the phone and call each other and find out what's 
happening. We have been.
    Using the public benefit fee we've been delving into the 
energy water nexus. Again, using the public benefit fee we have 
a publication coming out on water, waste water best practices, 
that will be distributed to the boards of water, even though we 
don't regulate them, as well as the private water sewer 
companies that we are--that we do regulate. So there's some 
cross pollination, pollinization going on between departments.
    Thanks to DLNR providing us with information, also 
Department of Health, we at least have staff talking to each 
other about how do we gain these additional efficiencies and 
how do we take these direct and indirect savings from designing 
within a system approach?
    Senator Schatz. Thank you.
    In the interest of time I'd like to move on.
    Mr. Rue, I appreciate your testimony. I appreciate that you 
delineated some ways that we can be helpful in terms of making 
sure that the Federal Government programs that already exist 
are coordinating best with the city and county of Honolulu on 
your projects.
    Which programs do you rely upon the most in terms of 
Federal revenue streams or individuals who are collaborating 
with you?
    Mr. Rue. Sure.
    I should confess that before joining, rejoining the city a 
few months ago, I did work as a consultant for several of the 
Federal agencies and help work on those programs myself. So I 
understand the inner mechanics a little bit.
    We do--we use a lot of funding from DOT, you know, in 
addition to the huge amounts that we are getting for the 
transit system itself, we get money for bus systems, for road 
repairs and building. Have a good working relationship there.
    We are in touch with the more innovative folks in the 
Livability program, both here locally as well as, you know, in 
DC and certainly get some wisdom from them. We are competing 
for a Tiger grant, you know, that's due out now, in the next 
month. So, it will be, you know, certainly pursuing competitive 
grants as well.
    With EPA we have had a strong relationship with their smart 
growth program, you know, since actually before it was. We had 
an EPA site visit in 2004 that was even before the 
Environmental Department was really kicked off. They've done 
several workshops, many of them through the sea grant program. 
I've been involved in a lot of them over the years, even when I 
was in Ohio.
    So there's a strong relationship there, particularly with 
sea grant on a lot of community designed issues.
    We recently applied for a Brown Fuels funding grant and we 
have a good relationship with those folks as well.
    Then with HUD we did receive a little over 2 million for 
the HUD Community Challenge grant. We set up an equitable 
housing fund. So we have a really good relationship with HUD, 
Office of Sustainable Housing and Communities, as well as with 
the ongoing regular statutory funding. I think one of their 
deputies was here recently working with our team on the 
homelessness issues and, you know, that kind of statutory 
funding
    Senator Schatz. Thank you very much.
    This goes for all the panelists and anybody in this room 
who is working in this phase. I know most of you already know 
this, but certainly our staff and our office and committee 
stands ready to assist you in all of the programs and projects 
that you're working on.
    Dr. Pauley, I want to talk to you about the master plan for 
Coconut Island. I appreciate your dawet pursuit of this vision 
and your relentlessness because I know that it's been, 
especially recently, quite challenging.
    My question for you, specifically is does the 1998 master 
plan, sort of, hold up? Does it need to be revised in order to 
attract the kind of leadership and funding that is required or 
is it essentially ready to go and just requiring some political 
will and some resources?
    Mr. Pauley. I think it's ready to go. There's really, all 
the components are there based on the things we've been hearing 
the last few days, water, sewer, thinking of the natural sewer 
system, solar panels. You know, we've been talking about solar 
for a long time out there. It just hasn't happened for one 
reason or another.
    So I think it's ready to go.
    Senator Schatz. Are we in arrears with respect to 
infrastructure, I mean, basic infrastructure at this point? Is 
there some? Do you have some sense of what the price tag would 
be?
    Mr. Pauley. At one time we thought that would be about $13 
million. The sea walls are all falling down and I know that 
Governor Abercrombie and Clayton, he found some money in the 
State this year to build some of that up to help the 
infrastructure. We certainly appreciate that.
    When I say we are really not--anybody to call the shots 
anymore since you gave the gift.
    But obviously I want to see the dream filled, fulfilled, 
out there and so far it hasn't happened.
    Senator Schatz. Thank you.
    Ms. Lippert, I have 2 questions for you.
    The first, what's your mix of funding? I know, and could 
you separate out how much money actually flows through your 
Excelerator and then you, I think, you provided a number, 55 
odd million in, I think, additional money raised, not 
necessarily coming through your organization.
    Could you separate those out by dollar amount and also give 
us, it doesn't have to be precise, but a rough breakdown of 
Federal, State and private dollars?
    Ms. Lippert. Yes, absolutely.
    So on our funding side the rough breakdown of Federal, 
State and private funding is primarily Federal, very little 
State money and increasing private money.
    So, on the Federal side primarily we've worked with the 
Office of Naval Research in the last couple of years. They have 
a commitment of $30 million over the next 5 years to fund this 
program which was seeded with Department of Energy money. So we 
really consider the Federal funding both Department of Energy 
and the Office of Naval Research funding as seed funding to 
prove out the vision.
    I think there will always be a role for public funding in 
this kind of effort because we're trying to achieve some really 
broad public policy goals, but ultimately what we're trying to 
do is prove value there and use that to attract private 
funding. We attracted the first tranche of private funding on 
New Year's Eve, actually, of this year, so December 31st from 
Hawaiian Electric Industries. I think that's really the 
direction that we're going to make it a true public/private 
partnership.
    On the company side we've invested approximately $10 
million of Federal funding so far and the companies have turned 
that into $55 million of follow on funding.
    Senator Schatz. Who owns the intellectual property?
    Ms. Lippert. The companies. Yes.
    So it's a traditional, sort of, Federal company 
relationship where the companies retain intellectual property, 
but the government has license to that intellectual property if 
it's of use to them.
    So this is a highly leveraged program where we've been able 
to match make investors with the companies to directly put 
capital into the companies. But in the future what we see as 
our role is a more direct fund where we actually have 
relationships with these investors as well. But so far they've 
been directly investing into companies and into projects.
    Senator Schatz. I'm just going to give you a minute to plug 
the why. That's my second question.
    [Laughter.]
    Ms. Lippert. OK, why unlimited renewable energy?
    So, I mean, the question here is why do we have a group, 
maybe, promoting renewable energy?
    Actually I think it goes back to something that we talked 
about yesterday at the ASCENT conference. It was one of the 
primary findings of our panel in public/private partnership 
which is the fundamental requirement for public/private 
partnership is trust. Why aren't--a way to help build trust in 
the community.
    Then the second thing is just tapping into the diversity of 
our resources. I think it's just really about finding talent 
within our community and tapping into talent wherever that may 
be to help achieve a transformation that's real and tough, but 
really important.
    Senator Schatz. Thank you very much.
    My final question will be for Chairman Morita.
    Could you just describe for the purposes of the record 
really, the Federal role in HCEI from the DOE and DOD 
perspective?
    Ms. Morita. OK, so first of all the partnership is 
extremely important to us. What it did was help bring resources 
to the State and help us leverage those resources in moving 
forward, accelerating the transformation to clean energy.
    Currently, now, we are looking at how to update the 
agreement, the partnership between the State and DOE. It's been 
in effect since 2008 and the technologies have changed, 
priorities have changed. So looking forward to an updated 
agreement.
    The other big issue is getting access to the national labs 
and the technical and economic expertise that they provide as 
we move forward. As I said in my testimony the technical and 
economic analyses will help us lead to better environmental and 
societal types of decisions. So just having that access to the 
expertise throughout the labs.
    Then again, taking what we learned in Hawaii and having it 
applied to other areas. It, you know, we're outliers in this 
area and as Commissioner Akiba said, you know, we're a postcard 
from the future and so all eyes are on us right now as we move 
forward. I think in establishing partnerships, the systemic 
approach, that's what we can demonstrate and prove out for, not 
only the rest of the country, but the rest of the world.
    Senator Schatz. Thank the panelists, thank you very much.
    I want to thank the East-West Center. I want to thank the 
University of Hawaii Sea Grant and everybody in this room. 
We've had a very productive couple of days. I appreciate it 
very much.
    [Whereupon, at 2:57 p.m. the hearing was adjourned.]

                                    

      
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