Even though Hawai`i is the nation\u2019s leader in solar power use per capita, no one here \u2014 not customers, not state legislators, and certainly not the solar industry \u2014 seems happy with the way the Hawaiian Electric companies have recently dealt with integrating renewable energy into their systems.<\/p>\n
Last year, the corporation placed restrictions on new solar photovoltaic (PV) installations that have left some 4,500 customers waiting for grid interconnection and also significantly reduced the rate of new installations. And in August, the company proposed roughly tripling its base rate, charging new PV customers $16 more, and paying net metering customers less for the power they feed back into the grid.<\/p>\n
So it\u2019s no surprise that the state and the U.S. Department of Energy (DOE) have negotiated a new memorandum of understanding (MOU) to guide Hawai`i\u2019s transition to clean energy.<\/p>\n
In 2008, the state and DOE signed an MOU establishing the Hawai`i Clean Energy Initiative (HCEI), which seeks by 2030 to meet 70 percent of the state\u2019s energy needs with clean energy (40 percent from renewable sources and 30 percent from conservation). But, according to state Public Utilities Commission chair Mina Morita, the HCEI\u2019s focus on lowering the cost of renewable energy projects has \u201cperverted the market.\u201d<\/p>\n
At the Asia Pacific Clean Energy Summit held last month at the Waikiki Convention Center, state and federal energy officials said the new MOU, signed on August 15, paves the way for \u201cHCEI 2.0.\u201d<\/p>\n
In attempting to describe the new approach, Morita said, \u201cHCEI 1.0\u201d dealt merely with integrating more renewable energy into the system. With HCEI 2.0, \u201cwe\u2019re seeking to transform the system, not only the electrical system, but also [the] utility business model,\u201d she said.<\/p>\n
Whether or how the Hawaiian Electric companies\u2019 recently released Power Supply Improvement Plans (PSIP) and Distributed Generation Interconnection Plans (DGIP) mesh with HCEI 2.0 remains to be seen. The public comment period on those plans is set to close on October 6. There is a long list of parties who have petitioned to intervene in the PUC dockets for those plans, so it will likely be months before the PUC votes on the utilities\u2019 proposals.<\/p>\n
Given the discussions at the summit and the comments submitted on those plans so far, it\u2019s clear that Hawaiian Electric and the PUC don\u2019t lack for advice.<\/p>\n
\u2018Stabbed in the Back\u2019<\/i><\/b><\/p>\n
In its September 12 order soliciting public comment, the PUC asked specifically for comments that address whether the plans provide clear, realistic strategies to 1) lower and stabilize bills; 2) integrate a variety of cost-effective renewable energy projects; 3) operate grids in a reliable, cost-effective manner with large amounts of variable renewable energy sources; and 4) \u201ccontain appropriate strategies and timely action plans, supported by well-reasoned and compelling analyses, to achieve these goals on each island.\u201d (The Hawaiian Electric utilities serve the counties of Honolulu, Maui, and Hawai`i. Kaua`i is served by the Kaua`i Island Utility Cooperative, an independent co-op.)<\/p>\n
As of late September, however, the majority of the comments received by the PUC didn\u2019t really speak to those questions. They were instead mostly complaints from irate customers who had recently spent tens of thousands of dollars installing PV systems in an effort to lower their electricity bills. Several wrote that they felt betrayed, \u201cstabbed in the back,\u201d by the proposal and that they would never have invested in PV had they known the utilities would seek to increase their bills anyway.<\/p>\n
Those that have invested into expensive PV systems should not be penalized with an electrical bill \u201cthat was nearly identical to [what it was] prior to putting PV systems on our roofs,\u201d wrote Bryon Martin.<\/p>\n
Some commenters offered specific tweaks to HECO\u2019s operations: it could transition to LNG, credit customers who limit their peak use, grandfather PV systems that have already been installed, or impose a range of surcharges depending on how many PV panels a customer had.<\/p>\n
Others recommended a complete overhaul of the utility.<\/p>\n
Boyd Sakai was one of them.<\/p>\n
\u201cBefore the company makes any new proposals to \u2018help out\u2019 ratepayers, it should look internally for answers,\u201d Sakai wrote. He said the time had come for parent company Hawaiian Electric Industries (HEI), which owns both Hawaiian Electric Company and American Savings Bank, to let the utility branch \u201csplit off and become independent of HEI, thus removing a layer of management that is unnecessary and excessive. Executives and staff at HEI are some of the most highly compensated in the state. A stand-alone HECO will make its operations more transparent to the public and PUC.\u201d<\/p>\n
\u201cMaybe it\u2019s time to look at another model for HECO such as a cooperative model that Kaua`i operates under,\u201d he added.<\/p>\n
Former Hawai`i attorney general Michael Lilly wrote, \u201cAll of HECO\u2019s plan is in the hope that 16 years from now, when many of us will have passed on, it MAY reduce the rates of all electrical customers. I don\u2019t believe them for one minute.\u201d<\/p>\n
\u201cDon\u2019t trust them,\u201d he told the commission.<\/p>\n
\u2018Center of the Universe\u2019<\/i><\/b><\/p>\n
In his summit keynote address, state Department of Business, Economic Development, and Tourism director Richard Lim offered a more dispassionate view.<\/p>\n
He praised the utility for addressing distributed generation, setting bold goals (67 percent renewable energy by 2030), and planning for liquefied natural gas (LNG) peaking units that will allow more flexibility on the grid and increase renewable energy generation. However, he said the plans were \u201cfar from transformational\u201d and that he found their plan to wait years before ramping up renewable integration puzzling.<\/p>\n
\u201cHopefully they can refine that,\u201d he said.<\/p>\n
In any case, \u201cHECO is still at the center of the universe and they must take the lead,\u201d said Lim, who went onto describe what he thought the Hawaiian Electric Company (HECO), and its sister companies on Maui (MECO) and Hawai`i (HELCO) should do.<\/p>\n
With the increase in distributed generation, the utilities must focus more on regulating inputs and away from generating base load, Lim said, adding that the transition will require substantial infrastructure improvements and also require the utility to rethink its business model and workforce.<\/p>\n
Hawaiian Electric should become more technology oriented, decentralized, and proactive, he said, adding that that is a tall order for an industry that has changed little in the past 70 years.<\/p>\n
Figuring out the role to be played by liquefied natural gas and community solar, and whether to impose standby charges on those who leave the grid are also challenges the utilities and the state need to address.<\/p>\n
\u201cUnfortunately, we don\u2019t have much time [to answer these questions]. The solar industry is in disarray,\u201d he said. The local solar industry, which Lim said accounted for 30 percent of all construction activity last year, significantly contracted after the utilities imposed restrictions on new installations.<\/p>\n
Paradigm Shift<\/i><\/b><\/p>\n
HECO senior vice president Jim Alberts attempted to explain his company\u2019s struggle with the rapid rise of PV. By the end of 2013, some 40,000 units had been installed and now, on many circuits, there is more generation than there is demand for power, he said.<\/p>\n
\u201cWe\u2019re in uncharted waters,\u201d he said. And even with the restrictions that have been placed on new installations, the problem continues to grow.<\/p>\n
Six months ago, 81 of HECO\u2019s circuits produced 120 percent of the daytime minimum load. As of last month, that number had grown to 101 circuits, according to Alberts.<\/p>\n
\u201cIn the beginning PV was launched very effectively, but as PV has grown and become mainstream [it] requires some adjustments,\u201d he said. Those include transitioning from a centralized system to a distributed one and creating a multi-directional grid.<\/p>\n
Alberts agreed with Lim that rather than being mainly a power generator, HECO needs to become more of a \u201cservices-based system.\u201d<\/p>\n
During a panel discussion on the HCEI, HECO vice president for corporate planning and business development Shellee Kimura also acknowledged that the utility will be radically changing the way it operates.<\/p>\n
HECO\u2019s goal of meeting 67 percent of its energy needs with renewables by 2030 will require 900 megawatts of distributed generation, Kimura said. That power will come from several plants, she said.<\/p>\n
She expects that by 2030, the load for the three utilities will include about 13 percent wind energy, 18.5 percent customer-sited renewables, 16.5 percent biomass, and about 8 percent geothermal.<\/p>\n
\u201cLNG is going to be a significant game-changer in our transformation,\u201d she said. \u201cLNG provides us with the cost savings that we can use to invest in our grid that will enable more renewables.\u201d One member of the public, however, disputed the benefits of LNG, noting that if LNG prices go up, it doesn\u2019t help lower costs, and if it goes down, it makes renewables less attractive.<\/p>\n
In addition to integrating more renewable energy, Kimura said HECO is considering offering value-added products and services, such as those related to electric vehicles, distributed generation, demand response, community solar (an alternative to rooftop solar), and micro-grids.<\/p>\n
Volume 25, Number 4 October 2014<\/p>\n","protected":false},"excerpt":{"rendered":"
Even though Hawai`i is the nation’s leader in solar power use per capita, no one here — not customers, not state legislators, and certainly not the solar industry — seems happy with the way the Hawaiian Electric companies have recently … Continued<\/a><\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[320],"tags":[3],"class_list":["post-6061","post","type-post","status-publish","format-standard","hentry","category-october-2014","tag-teresa-dawson"],"_links":{"self":[{"href":"https:\/\/environment-hawaii.org\/index.php?rest_route=\/wp\/v2\/posts\/6061","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/environment-hawaii.org\/index.php?rest_route=\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/environment-hawaii.org\/index.php?rest_route=\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/environment-hawaii.org\/index.php?rest_route=\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/environment-hawaii.org\/index.php?rest_route=%2Fwp%2Fv2%2Fcomments&post=6061"}],"version-history":[{"count":0,"href":"https:\/\/environment-hawaii.org\/index.php?rest_route=\/wp\/v2\/posts\/6061\/revisions"}],"wp:attachment":[{"href":"https:\/\/environment-hawaii.org\/index.php?rest_route=%2Fwp%2Fv2%2Fmedia&parent=6061"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/environment-hawaii.org\/index.php?rest_route=%2Fwp%2Fv2%2Fcategories&post=6061"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/environment-hawaii.org\/index.php?rest_route=%2Fwp%2Fv2%2Ftags&post=6061"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}