| 47 | | - | SECTION 1. The legislature finds that the State's ongoing energy transition from fossil fuels to renewable energy has been driven and supported by certain key energy laws and regulatory policies that were established after years, if not decades, of continued advocacy efforts. These laws and regulatory policies include, among others, the renewable portfolio standards established in chapter 269, Hawaii Revised Statutes; the performance-based regulation framework created by the public utilities commission for electric utilities; and the encouragement and oversight of renewable power purchase agreements by the public utilities commission, which are contractual agreements entered into by electric utilities and independent power producers for, among other things, the development and production of new utility-scale renewable energy projects. The legislature further finds that a bankruptcy or reorganization proceeding involving an electric utility company in the State could result in the acquisition, merger, or consolidation of that electric utility company with an acquiring entity that could ultimately lead to a change in management and control. In a worst-case scenario, the acquiring entity may seek to weaken, alter, or reverse those key state energy laws, policies, frameworks, and agreements that have greatly contributed to the State's progress toward meeting its renewable energy goals, or reduce the electric utility's capacity to maintain a qualified and knowledgeable workforce with the ability to support and pursue the State's renewable energy goals, as well as to ensure safe, efficient, reliable, and continuous electric utility service to local consumers and the community. Accordingly, the purpose of this Act is to: (1) Require the public utilities commission to consider whether approving a proposed merger or acquisition of an electric utility company would or would not further the State's renewable energy goals; (2) Prohibit the acquiring entity of an electric utility company from terminating or attempting to renegotiate any existing and valid power purchase agreements and require the acquiring entity to assume and be bound by existing collective bargaining agreements and retain all covered employees; (3) Establish a process to ensure that when an electric utility is subject to an application for a proposed acquisition, merger, or consolidation by a potential acquiring entity that is an investor-owned utility and seeks approval of the application from the public utilities commission, the electric utility shall demonstrate that it solicited bids from potential acquiring entities that operate under non-investor-owned utilities ownership models; and (4) Require the electric utility to submit acceptable bids from a potential acquiring entity operating under a non-investor-owned utilities ownership model concurrently with an application by a potential acquiring entity that is an investor-owned utility. SECTION 2. Chapter 269, Hawaii Revised Statutes, is amended by adding two new sections to part I to be appropriately designated and to read as follows: "§269-A Acquisition, merger, or consolidation of electric utility companies; conditions of approval. (a) The public utilities commission shall consider whether approving a proposed merger or acquisition of an electric utility company by an acquiring entity would or would not further the State's renewable energy goals. (b) The acquiring entity shall not terminate any existing and valid power purchase agreement between the electric utility company and an independent power producer of energy services based solely on the completion of the acquisition, merger, or consolidation; provided that nothing in this subsection shall prevent the termination of a contractual agreement as permitted by its terms, subject to approval by the public utilities commission. The acquiring entity shall not attempt to renegotiate any material provisions of any existing and valid power purchase agreement, including but not limited to the established payment rates for energy or energy storage or other commercial terms; provided that nothing in this subsection shall prevent the amending of a contractual agreement as may be permitted under its terms, subject to approval by the public utilities commission. Before the completion of the acquisition, merger, or consolidation of the electric utility company, the acquiring entity shall not unduly influence the terms of any power purchase agreement that is under negotiation between the electric utility company and an independent power producer of energy services. (c) The acquiring entity shall assume and be bound by the terms and conditions of any existing collective bargaining agreement in place at the time of the acquisition, merger, or consolidation, as it applies to covered employees. (d) The acquiring entity shall retain all covered employees, and shall not induce or cause a reduction in force, or terminate a covered employee, other than for cause consistent with any applicable collective bargaining agreement. (e) For the purposes of this section: "Acquiring entity" means the entity that acquires all or some classes of an electric utility company's interests in an interest exchange, including but not limited to interest in any road, line, plant, system, or other real or personal property necessary for the performance of the electric utility's duties to the public or any franchise or permit, or right thereunder. "Covered employee" means an individual who is employed by and is a party to a collective bargaining agreement with an electric utility company immediately before an acquisition, merger, or consolidation of the electric utility company by an acquiring entity, as approved by the public utilities commission. "Electric utility company" means a public utility as defined in section 269-1, for the production of, conveyance, transmission, delivery, or furnishing of electric power. §269-B Acquisition, merger, and consolidation of electric utility companies; investor-owned acquiring entities; consideration of alternative applications. (a) Notwithstanding sections 269-7.5, 269-18, and 269-19, if an electric utility is subject to an application for a proposed acquisition, merger, or consolidation by a potential acquiring entity that is an investor-owned utility and seeks approval of the application from the public utilities commission, the electric utility shall demonstrate that it solicited bids from potential acquiring entities that operate under non-investor-owned utility ownership models and specify whether any potential acquiring entities that operate under such an ownership model submitted bids and the reasons why such bids were or were not accepted. Upon receiving an acceptable bid from a potential acquiring entity that operates under a non-investor-owned utilities ownership model, the electric utility company shall present the bid to the public utilities commission concurrently with an application by a potential acquiring entity that is an investor-owned utility. (b) The public utilities commission shall, upon receiving an application for the acquisition, merger, or consolidation of an electric utility company, commence a regulatory proceeding to review the application; provided that any bids submitted concurrently pursuant to subsection (a) shall be reviewed concurrently. (c) The electric utility company shall have no obligation to affirmatively state its position in support of or in opposition to any pending application. (d) Notwithstanding any law or rule to the contrary, the public utilities commission shall have the power to consolidate its review of all submitted applications pursuant to this section. (e) This section shall not apply to the acquisition of a not-for-profit enterprise that is not owned by shareholders. (f) For the purposes of this section: "Acquiring entity" has the same meaning as in section 269-A. "Electric utility company" has the same meaning as in section 269-A. "Non-investor-owned utility ownership model" means a member-owned cooperative utility or any not-for-profit enterprise that is not owned by shareholders." SECTION 3. In codifying the new sections added by section 2 of this Act, the revisor of statutes shall substitute appropriate section numbers for the letters used in designating the new sections in this Act. SECTION 4. New statutory material is underscored. SECTION 5. This Act shall take effect on July 1, 3000. |
|---|
| 47 | + | SECTION 1. The legislature finds that the State's ongoing energy transition from fossil fuels to renewable energy has been driven and supported by certain key energy laws and regulatory policies that were established after years, if not decades, of continued advocacy efforts. These laws and regulatory policies include, among others, the renewable portfolio standards laws established under part V of chapter 269, Hawaii Revised Statutes; the performance-based regulation framework created by the public utilities commission for electric utilities; and the encouragement and oversight of renewable power purchase agreements by the public utilities commission, which are contractual agreements entered into by electric utility companies and independent power producers for, among other things, the development and production of new utility-scale renewable energy projects. Notwithstanding, the legislature further finds that a bankruptcy or reorganization proceeding involving an electric utility company in the State could result in the acquisition, merger, or consolidation of that electric utility company by an acquiring entity that could ultimately lead to a change in management and control. In a worst-case scenario, the acquiring entity may seek to weaken, alter, or reverse those key state energy laws, policies, frameworks, and agreements that have greatly contributed to the State's progress towards meeting its renewable energy goals, or reduce the electric utility's capacity to maintain a qualified and knowledgeable workforce with the ability to support and pursue the State's renewable energy goals, as well as to ensure safe, efficient, reliable, and contiguous electric utility service to local consumers and the community. Accordingly, the purpose of this Act is to: (1) Require the public utilities commission to consider whether approving a proposed merger or acquisition would or would not further the State's renewable energy goals; and (2) Establish a process to ensure that when an application for the proposed acquisition, merger, or consolidation of an electric utility company is filed with the public utilities commission by an acquiring entity that is an investor-owned utility, alternative applications from entities that operate under a non-investor-owned utilities ownership model may be concurrently submitted and reviewed. SECTION 2. Chapter 269, Hawaii Revised Statutes, is amended by adding two new sections to part I to be appropriately designated and to read as follows: "§269-A Acquisition, merger, or consolidation of electric utility companies; conditions of approval. (a) The public utilities commission shall consider whether approving a proposed merger or acquisition of an electric utility company by an acquiring entity would or would not further the State's renewable energy goals. (b) The acquiring entity shall not terminate any existing and valid power purchase agreement between the electric utility company and an independent power producer of energy services based solely on the completion of the acquisition, merger, or consolidation; provided that nothing in this subsection shall prevent the termination of a contractual agreement as permitted by its terms, subject to approval by the public utilities commission. The acquiring entity shall not attempt to renegotiate any material provisions of any existing and valid power purchase agreement, including but not limited to the established payment rates for energy or energy storage or other commercial terms; provided that nothing in this subsection shall prevent the amending of a contractual agreement as may be permitted under its terms, subject to approval by the public utilities commission. Before the completion of the acquisition, merger, or consolidation of the electric utility company, the acquiring entity shall not unduly influence the terms of any power purchase agreement that is under negotiation between the electric utility company and an independent power producer of energy services. (c) The acquiring entity shall assume and be bound by the terms and conditions of any existing collective bargaining agreement at the time of the acquisition, merger, or consolidation, as it applies to covered employees. (d) The acquiring entity shall retain all covered employees, and shall not induce or cause a reduction in force, or terminate a covered employee, other than for cause consistent with any collective bargaining agreement. (e) For the purposes of this section: "Acquiring entity" means the entity that acquires all or some classes of an electric utility company's interests in an interest exchange, including but not limited to interest in any road, line, plant, system, or other real or personal property necessary for the performance of the electric utility's duties to the public or any franchise or permit, or right thereunder. "Covered employee" means an individual who is employed by and is a party to a collective bargaining agreement with an electric utility company immediately before an acquisition, merger, or consolidation of the electric utility company by an acquiring entity, as approved by the public utilities commission. "Electric utility company" means a public utility as defined in section 269-1, for the production of, conveyance, transmission, delivery, or furnishing of power. §269-B Acquisition, merger, or consolidation of electric utility companies; investor-owned acquiring entities; consideration of alternative applications. (a) The public utilities commission shall, upon receiving an application for the acquisition, merger, or consolidation of an electric utility company, commence a regulatory proceeding to review the application. Notwithstanding the provisions of sections 269‑7.5, 269-18, and 269-19, upon commencement of the regulatory proceeding to review the application, if the application proposes the acquisition, merger, or consolidation of an electric utility company by an acquiring entity that is an investor-owned utility, the public utilities commission shall, for a period of one hundred eighty days, suspend its review of the application and immediately establish a process, subject to the requirements of this section, for the consideration of alternative applications from acquiring entities that operate under a non-investor-owned utilities ownership model. (b) If bona fide applications are submitted to the public utilities commission by acquiring entities that operate under a non-investor-owned utilities ownership model for the acquisition, merger, or consolidation of the electric utility company within the one hundred eighty day period, the public utilities commission shall review the applications concurrently. The electric utility company shall have no obligation to affirmatively state its position in support of or in opposition to any pending application. (c) Notwithstanding any law or rule to the contrary, the public utilities commission shall have the power to consolidate its review of all submitted applications pursuant to this section. (d) This section shall not apply to the acquisition, merger, or consolidation of a not-for-profit enterprise that is not owned by shareholders. (e) For the purposes of this section: "Acquiring entity" has the same meaning as defined in section 269-A. "Electric utility company" means a public utility as defined in section 269-1, for the production of, conveyance, transmission, delivery, or furnishing of power. "Non-investor-owned utilities ownership model" means a member-owned cooperative utility or any not-for-profit enterprise that is not owned by shareholders." SECTION 3. In codifying the new sections added by section 2 of this Act, the revisor of statutes shall substitute appropriate section numbers for the letters used in designating the new sections in this Act. SECTION 4. New statutory material is underscored. SECTION 5. This Act shall take effect on July 1, 2050. |
|---|