DBEDT Announces Details of Bond Issue to Support Green Energy Market Securitization Program

Posted on Oct 29, 2014 in News

Hawaii State Energy Office
For immediate release: October 29, 2014

HONOLULU—The Hawaii State Department of Business, Economic Development and Tourism Wednesday announced the details of an upcoming offering of approximately $150 million of bonds to support the department’s Green Energy Market Securitization program.

DBEDT intends to use proceeds from the bond sale to fund a loan program that would expand the installation of solar photovoltaic panels and other clean energy devices for Hawaii consumers.

The GEMS program initially will focus on investments in PV systems and other technologies that support PV interconnection, such as energy storage, advanced inverters and monitoring devices. Other proposed clean energy projects will be evaluated on a case-by-case basis through a process being established by the program.

The state plans to price the $150 million of bonds early the week of Nov. 3. Local investors will be able to place orders during a special retail order period. The bonds will be issued in minimum denominations of $5,000 and multiples of $1,000 in excess thereof. Interest on the bonds is exempt from state taxes, but is included in gross income for federal income tax purposes.

The state has designated the bonds as “green bonds” based on the intended use of the proceeds for the financing of environmentally beneficial projects.

Hawaii is the first state in the nation to use this type of financing structure to help consumers pay for clean energy installations. A Green Infrastructure Fee, which was approved by the PUC, will be used to secure the bonds to ensure they achieve the highest possible credit rating. The fee will be offset by a reduction in the Public Benefits Fee that is currently on electric bills.

A preliminary offering statement describing details of the bond offering is available on the Department of Budget and Finance website: investorrelations.hawaii.gov/dbedt. Goldman, Sachs and Co. and Citigroup are joint lead managers for the bond sale. First Southwest Company acted as Financial Advisor to the department for this transaction.

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The Hawaii State Energy Office is leading the state’s charge toward clean energy independence. With a goal to meet and exceed Hawaii’s 70 percent clean energy targets by 2030, the State Energy Office is committed to developing and deploying high impact solutions that will maximize Hawaii’s renewable energy resources and improve efficiency and transportation standards. Through effective policies and innovative programs, the State Energy Office has positioned Hawaii as a leading proving ground for clean energy innovation, which will generate quality jobs, attract investment opportunities and accelerate economic growth. The State Energy Office is a division of the state’s Department of Business, Economic Development and Tourism. For more information, visit energy.hawaii.gov.

Alan Yonan Jr.
Communications Officer
DBEDT State Energy Office
(808) 587-3860