Hawaii PUC staff outlines bill credits for community renewable energy programs

Dive Brief:

The staff of the Hawaii Public Utilities Commission is proposing that state residents participating in community renewable energy projects receive a credit on their electric bills, the Honolulu Star-Advertiser reports.
In exchange for a one-time payment, ratepayers would receive a share of the electricity generated by a renewable project for 20 years. Customers would also get a discount on their electric bills in proportion to their electricity generated and the amount of their initial investment.
The PUC staff was responding to proposals made by Hawaiian Electric and Kauai Island Electric Utility Cooperative in response to a state law. Act 100, mandating that the state’s utilities find ways to make renewable energy projects more affordable to a wider variety of the state’s residents.

Dive Insight:

Hawaii has the most aggressive renewable portfolio standard in the United States — 100% renewable energy by 2045. But those ambitious goals do not come without growing pains.

Rapid adoption of rooftop solar prompted Hawaiian Electric to push for a reduction in retail rate remuneration, approved in October of last year. And amid a budget crunch, environmental advocates are struggling to find alternatives that make renewables economic, as well as equitable.

One of those efforts is the state’s Community-based Renewable Energy (CBRE) program, which aims to extend the reach of renewable energy to residents without adequate rooftop space by aggregating renewable resources at the community level.

In response to proposals submitted by Hawaiian Electric and Kauai Island Electric Utility Cooperative, the staff of the PUC has proposed a market-based “framework” for the implementation of the CBRE program.

The PUC proposal calls for two tiers of projects, Tier 1, 25 kW up to 250 kW, and Tier 2 for projects greater than 250 kW. The projects would be subject to time-of-day rate caps, and developers would bid for a credit rate underneath that cap in a process similar to a reverse auction. Subscribers to a project would be credited for the energy produced at the determined credit rate.

On Oahu, the most populous island, participating residents would be credited $0.15/kWh at midday (9 a.m. to 5 p.m.), $0.1775/kWh on-peak (5 p.m. to 10 p.m.) and $0.17/kWh off-peak (10 p.m. to 9 a.m.). On Maui, credits would be $0.1375 at midday, $0.19/kWh on-peak, and $0.1575/kWh off-peak.

The highest proposed rates would be for on-peak power on Lania, 24.75 cents/kWh. Next highest would be for projects on Molokai, 20.5 cents/kWh for on-peak power. The lowest rates would be on Kauai, 14.50 cents/kWh on-peak and 16 cents/kWh on the big island of Hawaii.