It’s an ambitious plan and one that’s already drawing fire from environmentalists as well as the solar industry.
Hawaiian Electric Company has released details of its vision for the state’s energy future, and part of the plan calls for 65 percent of all electricity generated on Oahu, the Big Island and Maui County to come from renewable sources. However, the company is being criticized by environmental groups like the Blue Planet Foundation for relying too heavily on liquefied natural gas, or LNG.
"We've been here before with importing fossil fuel and we don't think that's the way to power our future," said Blue Planet Executive Director Jeff Mikulina. "We have every clean energy opportunity here in Hawaii and that's one thing we see missing in the plan is really expanding that opportunity and capitalizing on our natural resource base.”
Still, HECO maintains LNG is the best way to lower costs for rate payers, and has set the goal of lowering its customers’ electricity bills by 20 percent within the next 15 years adjusted to inflation.
"That is going to be significant because it provides the cost savings for customers that we can use to invest in the grid,” Shelle Kimura, HECO’s vice president of corporate planning and business development, said of LNG. “It’s going to significantly reduce our CO2 emissions, and because it’s cheaper, it’s actually going to enable more renewables.”
Under Hawaii’s Renewable Portfolio Standards, 40 percent of the state’s total energy output must be met by renewable resources by the year 2030. HECO believes tripling the amount of rooftop solar will play a critical part in meeting that goal, but says a more equitable system needs to be developed so households without photovoltaic won’t be penalized. Currently, 11 percent of HECO's customers on Oahu have a rooftop solar system.
"We're really focused on fairness for all customers, and so last year, customers that don't have rooftop solar, they paid an additional $38 million for the operation and maintenance of our grid,” said Kimura.
Under its plan submitted to the Public Utilities Commission, HECO wants to add an unspecified connection charge to households seeking rooftop solar. Currently, households wanting to connect a PV system pay nothing. The proposal also calls for a fixed monthly fee of $55 for all customers on Oahu and an additional $16 for those with PV systems. Meanwhile, the company wants to purchase excess electricity from households with rooftop systems at .16 cents per kilowatt hour, compared to the more than .30 cents per kilowatt hour it now pays.
“We looked the economics for customers that would want rooftop solar and that was actually the basis for the adoption rate that we put forward that triples distributed generation over the next 15 years,” said Kimura. “The payback period for solar might be three to five years with the subsidies we have in place today. Under the more equitable structure, we think it’ll get maybe to seven to nine years, which would be very competitive with a solar-heavy state like California.”
If the PUC adopts HECO’s plan as is, Blue Planet foundation is concerned PV households will simply disconnect from the electrical grid altogether.
“Technology is changing so rapidly and with the advent of these home energy storage systems that are decreasing in cost, people might decide it's not worth it (and) might go on their own,” said Mikulina. "That's actually a situation we don't want in Hawaii because wealthy folks will do that first and strand everyone else paying for the whole system. So, the utility needs to find this model that actually compensates folks fairly for the electricity they produce."
On the Big Island and Maui County, part of Hawaiian Electric’s proposal calls for the expansion of geothermal energy, which has been controversial, especially among native Hawaiians. Not mentioned in HECO’s filing with the PUC are any plans to convert it from a for-profit company to a co-op or nonprofit utility. Kimura said as a private company, HECO can raise the amount of capital needed to help modernize the state’s electrical grid.
"We're still going to need significant amount of up front capital, and you need access to the capital markets to get that kind of access to funds," she said.
Mikulina says Blue Planet wants to be named an intervenor in HECO's filing with the PUC, which would allow the environmental group to provide expert testimony and help shape any proposal for Hawaii's energy future.
“Everyone can participate in this,” said Mikulina. “This is really a shared resource in Hawaii and energy touches everyone in one way or another.”