ORIGINAL REPORTING: After Net Metering in Hawaii
What comes after net metering: Hawaii's latest postcard from the future; Hawaii regulators offered two new remuneration schemes for rooftop solar in a landmark decision last week
Herman K. Trabish, October 22, 2015 (Utility Dive)
Editor’s note: Hawaii regulators are preparing to deal with the turmoil and slowdown in Hawaii’s solar industry that resulted from this policy change.
The Hawaii Public Utilities Commission closed retail rate net energy metering (NEM) reimbursement programs from the Hawaiian Electric utilities to owners of solar and other distributed generation (DG). There will be no gradual withdrawal of the incentive. The Hawaiian Electric programs were capped at existing levels as of the release of the Oct. 12 decision, and lower remuneration rates were put into place for new rooftop solar systems on each of the state's islands. Systems with existing retail rate net metering deals will be able to keep them for the life of their contracts.
Renewables policy issues in Hawaii are commonly referred to as postcards from the future because the high penetration of solar on the isolated island’s grid has forced the power sector into changes that many observers expect to hit the mainland in the coming years. If and when that happens, the decisions Hawaii utilities and their regulators make will help instruct utility regulators across the country.
In its order, the PUC wrote the state's high net metering credit has led to unprecedented DER penetration in a short period of time. Net metered systems have increased by over 60 times the cap established by the initial 1996 legislation that set up the metering program. Program capacity now runs from 30% to 53% of system peak load, depending on the utility. Nearly 20% of all customers of the Oahu (HECO) and Maui (MECO) utilities have net metered DG.
To replace NEM, the decision orders two new credits (“tariffs”): A “grid-supply” option and a self-supply option. The grid-supply option replaces NEM’s retail rate credit for electricity sent to the grid by customers' solar systems. To provide some marketplace certainty, the decision orders the grid-supply tariff to be guaranteed for two years but has a hard cap on the amount of eligible capacity. The self-supply tariff allows system owners to earn retail rate credit in the form of reduced bills for generation that aligns with their energy demand patterns. As the islands approach the grid-supply caps, more postcards are expected. click here for more