Legislators want power to sway HECO decision

Hawaiian Electric plans to add rooftop capacity but cut pay for extra juice

Honolulu Star Advertiser - January 21, 2015

By: Kathryn Mykleseth

Hawaiian Electric Co. said Tuesday it wants to double rooftop solar capacity while lowering the rate it pays solar customers for excess power, and state lawmakers said they'd like a say in whether to approve that plan.

The utility said it has asked the Public Utilities Commission to approve the plan within 60 days.

"Shouldn't you guys be introducing the bill (at the Legislature) and we would have the public involved?" said state Sen. Mike Gabbard (D, Kalaeloa-Maka¬¬kilo), chairman of the Senate Energy and Environment Committee, at a Capitol briefing on energy policy.

If approved, the rate the utility pays solar customers on Oahu who feed excess power into the grid would fall to about 15 cents per kilowatt-hour from 29 cents.

Customers who already have rooftop solar or pending applications at the time of the proposal's approval will be grandfathered in, said Jim Alberts, senior vice president of customer service at HECO, at a news conference prior to the legislative hearing.

"The key point is our proposal is not asking for changes with our customers that are already connected or waiting for connection approval; this is a forward-looking proposal," he said.
Restructuring the rate paid to future solar customers with rooftop solar is what is fair, said HECO.

In 2014 nonsolar customers paid an additional $53 million in operation and maintenance costs to compensate for the low electrical bills of solar customers.

Mark Duda, president of the Hawaii PV Coalition, said HECO has not been transparent about how it calculated the $53 million.

"The cost shift has not been documented. It has just been asserted," said Duda.

The solar industry said it was open to discussions about changing the incentives but emphasized the need for regulatory participation.

"(Hawaii Solar Energy Association) is interested in looking at this analysis and what is fair, but the PUC should be the one making those choices," said Leslie Cole-Brooks, executive director of the Hawaii Solar Energy Association.

Rolf Christ, president of R&R Solar Supply, said HECO's proposed 15 cents per kilowatt-hour is just too low, but he wasn't opposed to some reduction in the credit.
"I don't quite agree with as low as HECO wants to go. There should be grounds in between," Christ said.

The solar industry praised HECO's decision to double the amount of solar allowed in each neighborhood, as it would help speed up the 2,500 pending solar applications. The utility committed to approving most of those systems by April and all by the end of 2015.

HECO has been slow to approve rooftop solar systems in neighborhoods where it said solar power has reached 120 percent capacity. HECO said exceeding 120 percent could be dangerous to homes and the grid. On Tuesday the utility said it now believes it can safely go to 250 percent of capacity. The change was due to a recent study HECO conducted with SolarCity Corp. that showed the grid can handle much more solar power.

"It's definitely very good news that the decision has been made to increase the circuit penetration from the current 120 percent of daytime minimum load in equivalent PV generation to 250 percent," Marco Mangelsdorf, president of ProVision Solar, said in an email. "This should allow for a substantial increase in the number of rooftop PV systems for homeowners across the Hawaiian Electric service territories."

Solar advocates expressed concern over HECO pairing the announcement of doubling the amount of rooftop solar that can connect in certain areas with the adjustment to net energy metering, or excess power, prices.

"We think it's sheer hypocrisy that Hawaiian Electric Industries (HECO's parent company) would finally agree to allow more rooftop solar but in the same breath propose eliminating net energy metering," Robert Harris, spokesman for the Alliance for Solar Choice, said in a statement. "This is a play out of the national utility playbook to stop rooftop solar — allege costs and try to make HEI's expensive fossil fleet more competitive with solar."

HECO assured solar industry representatives and lawmakers the announcement was not related to the utility's bottom line.

"This is not about our profit or our revenues. It is solely to address economic issues around fairness," said Alberts, the HECO customer service senior vice president.

State Sen. Rosalyn Baker (D, South and West Maui) said fairness to nonsolar HECO customers is important.

"I think the discussion of fairness has to include all of those who do not have access to PV," Baker said. "Everyone here is representing a business or an entity, and no one is standing up for people who don't have access and paying for rates that they can't afford."

State Rep. Angus McKelvey (D, Lahaina-Kaanapali-Kapalua-Maalaea-Kihei-North Kihei) echoed Baker's concerns.

"There is a need for utility-level renewable generation. There is a need for a system where everyone benefits," McKelvey said. "We need PV-distributed generation. It is important and critical, but it has to mesh with a system that benefits everybody. We don't want a situation where it becomes sector versus sector or person versus person. We need to think of this as to how we can create a win-win for those who want to do distributed generation but so that others aren't left holding the bag."