The jury is in, and it appears that Act 204, the solar water heater mandate, a cornerstone of the 2008 Legislature, is way below expectations. Charitably, this is the Mangled Mandate.

A BILL FOR A BUZZWORD

Senate Majority Leader Gary Hooser, D-7th (Kaua'i, Ni'ihau) introduced SB 644 for the lofty purpose of reducing our dependence on fossil fuel and "spreading the gospel of solar." The bill was supposed to "mandate" solar water heaters to get us off oil, but it may instead perpetuate our addiction to it.

The Hawaii Solar Energy Association and the Hawaii Renewable Energy Alliance, as well as the Building Industry Association, opposed the bill. Even HECO wound up opposing the bill. They know lots about solar, but their voices were roundly ignored. This is not a recipe for success.

As the bill wended its way through the Legislature, the exceptions ate the mandate. They added an exception for gas water heaters on condition that the homeowner buys a second gas appliance, thus a windfall for the gas industry. In Hawai'i, gas appliances run on synthetic natural gas, made from oil. So this became a mandate to get us off fossil fuel, except for oil itself. Got it?

The bill was titled "A bill for an act relating to energy resources." The "E" word was a magnet for the environmentalists. The Sierra Club got into the act and supported the bill even after the exceptions had eaten it. With that big-gun support, the bill passed in a nearly unanimous vote.

The governor contemplated vetoing the bill, later said she would let it become law without signature, and ultimately did a one-eighty and signed it as Act 204 with a statement of concern about its flaws. But if it was so flawed, why did she sign it?

State Sen. Hooser and state Rep. Hermina Morita, D-14th (Hanalei, Anahola, Kapa'a) pushed the bill through. Didn't they know that solar installations in Hawai'i have been increasing and that the solar industry does not feel that this growth requires a mandate?

In fact, we've done very well with the existing solar tax credit and HECO rebate incentives. Solar water heaters have been installed in nearly 100,000 homes, 25 percent of all the homes in the state, and believe it or not, 50 percent of all the installations in the country, all without solar mandates.

If it isn't broken, don't fix it. Why did Hooser and Morita brush off the solar industry? Do they know more about solar than the industry does? It does seem ill-advised for them to push this bill through disregarding the objections of the solar and building industries. Surely, there were better things to do in that session.

SAUSAGE OR CARNAGE

The bill was supposed to be about solar, but it incentivizes water heaters that use fossil- fuel gas. It terminates solar tax credits and HECO rebates, raising costs to buyers, and effectively de-incentivizes solar. It terminates the existing "100 point" solar quality control inspection for buyers. And it denies new home buyers a right to choose water heater systems of a scale appropriate to the size of their families. Not great.

Other trap-door exceptions were built into the bill. The mandate does not apply, and fossil-fuel heaters can be installed, if a solar water heater is not deemed "cost effective" or if the "solar resources" (sunlight) are deemed "insufficient." Any architect or engineer, regardless of metrics, skill or bias, can make that decision. Could this be ripe for abuse?

Without a solar credit, the gas option is much cheaper than the solar option because the Gas Co. already is offering free appliances. To manage costs, a great many builders and homeowners are likely to opt for gas, giving the bill exactly the opposite effect from what was intended.

The bill also apparently terminates solar credits on existing homes, so there is no incentive for the remaining 300,000 nonsolar homeowners to install solar. That's a lot of emissions, much more than for the 6,000 new homes built each year. It seems to be open season on energy credits these days, both Hawai'i and federal.

The bill is not the energy bill it was supposed to be, and it's not consistent with our state energy policy. It was intended to mandate solar, but we are left with no solar incentives and a mandate that favors fossil fuel. Home buyers will pay more, and it will take Hawaii longer to convert to renewable energy. It's a mangled mandate for sure, and an embarrassment.

ALL THE QUEEN'S HORSES

When she signed it, Lingle characterized the bill as a mandate for both solar and gas. She acknowledged that it could be read to repeal state tax credits for solar heaters. She said she'd push for legislation next year to make sure tax credits for solar water heating continue.

Designated Act 204, we have only one session to fix it before it goes into effect on January 1, 2010. But when you try to change a law, especially a controversial one, the outcome is unpredictable, and you're likely to have more unintended consequences. You risk a re-mangle, or worse.

For the solar and building industries and the new-home buyer, repeal would be best. But how can you repeal a law about renewable energy when those buzzwords are so highly charged? Short of repeal, the best solution is to remove the gas exception, mandate only that new homes be "solar-ready" and let the buyer select the right size system, and keep the credits, rebates and inspections in place. But that seems uphill, too.

Don't make any bets on what will happen. We may have to live with this act, to the frustration and disappointment of the entrepreneurs who built Hawai'i's solar industry in the first place, and that would be regrettable.

KNEE-JERK LEGISLATION

Rather than wean us off fossil fuel in time for 2030, this act gives us disruption, uncertainty and gas. It does not get a passing grade, either in process or result.

Quality legislation requires thoughtfulness and courage. Thoughtfulness here would have given us better diligence and greater respect for the experience of industry. If a mandate was to be the mechanism, courage would have given us a mandate without all these unfortunate exceptions.

Instead, the proponents of this bill were thinking about its labeling, its sound bites and its accolades but not its provisions. They titled it an energy bill, and its supporters never noticed, or cared, that it had lost its way. It's like reading a headline without reading the article — superficial and disconnected.

In a world where good energy policy is crucial to our future, there's no room for knee-jerk legislation. We need to understand these issues and require our officials to understand them. If an official produces wrong-way legislation like this act, we should hold that official accountable. November is still coming.