Hawaii plan puts solar centre stage

With pressure mounting to address the state’s flagging solar sector, Hawaiian Electric (HECO) has published a sweeping – albeit vague – plan that it says will allow for a tripling of the state’s distributed PV capacity over the next 15 years.

HECO, which serves as electricity retailer to 95% of Hawaii’s 1.4 million residents, claims its plan will see Hawaii sourcing 65% of its electricity from renewables by 2030 – up from about 18% today – while also gradually building up a fleet of quick-start gas plants.

That, in turn, will lead to a 20% reduction in electricity bills in the state with the highest power prices in the nation, HECO believes, as Hawaii weans itself off expensive imports of oil, which currently account for the majority of electricity generation.

Calling it the “start of a conversation”, Hawaiian Electric chief executive Dick Rosenblum says the plan “sets us on a path to a future with more affordable, clean, renewable energy”.

As a result of Hawaii’s sky-high electricity prices, which are more than double the national average, PV has already reached grid parity in many parts of the state – and rooftop installations have boomed in recent years.

On a per-customer basis, HECO has the most watts of installed PV capacity – and the highest number of installed PV systems – among all major US utilities.

Yet given the small size of the independent island grids managed by HECO and its subsidiaries, the utility has sought to tamp down PV installations, which it claims have reached “dangerous” levels in some parts of the state.

Critics have claimed HECO, which is the business end of New York-listed Hawaiian Electric Industries Inc., was slowly PV installations merely to buoy its own profits.

Last year HECO asked all residential and commercial customers in Oahu, the state’s most populous island, to check with it before installing a PV system, amid widespread reports that many already-installed systems were not being allowed to connect to the grid.

The penetration of PV in Oahu’s power mix is higher than 10%. Hawaii as a whole already derives more than 18% of its electricity from renewables, outstripping its 15% target for 2015. In addition to solar, Hawaii also has strong potential for wind, geothermal and ocean energy.

Amid layoffs in Hawaii’s once-booming solar sector, the state’s Public Utilities Commission this April gave HECO until this week to spell out a plan for accommodating more renewables.

HECO’s plan, released at the last minute, touches on a sweeping array of initiatives both currently underway and slated for future implementation – ranging from energy storage to smart grids to community solar projects.

HECO says it will adopt a “clear, open planning process” that will make transparent to PV companies and customers how much additional solar can be added each year, a figure that should grow over time as grid enhancements are put in place.

Hawaii added 146MW of PV capacity last year, making it the sixth largest market in the nation – despite being only the 40th most populous state. Unique among major statewide PV markets, at least for now, the majority of Hawaii’s capacity is added to residential rooftops.

HECO’s plan will see it rapidly expand its use of energy storage – including batteries – as a backup for renewable generation, with the first storage projects in Oahu to be put into service by early 2017.

Smart grids will be installed across Hawaii Island and Maui – the state’s second and third most populous islands – by late 2017, and across Oahu – home to state capital Honolulu – by late 2018.

HECO has pledged to begin offering new products and services to its electricity customers, including demand-response services, micro-grids and community solar projects.

HECO also intends to convert most of Hawaii’s existing oil-fired generating units to run on liquefied natural gas by 2030.