HECO and Hawaii Consumer Advocacy oppose increasing solar cap despite industry plea

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The CGS scheme has proved far more favourable amongst consumers, which mounted pressure on the scheme, causing industry groups to rally for a cap increase. Source: Flickr

Island utility Hawaii Electric Co (HECO) and the state Division of Consumer Advocacy have both issued a filing with the Public Utilities Commission (PUC) to oppose the request put forward by solar industry trade groups to increase the cap on one of the options for installing rooftop PV that replaced net-metering.

When Hawaii regulators ended retail net-metering in the islands in October, they introduced two new tariffs to succeed the scheme: Customer Grid Supply (CGS) and Customer Self Supply (CSS).

The CGS programme set solar rates at US$0.154/kWh for Hawaii, US$0.151/kWh for Oahu and US$0.172/kWh for Maui, according to public documents. These rates roughly mirror the value of recent PPAs for utility-scale solar in the state. The CSS programme, however, allows customers to earn credits at the retail electricity rate, but prevents them exporting generated power into the grid.

The caps on the CGS programme are 25MW for HECO’s Oahu territory and 5MW each for its subsidiaries on Maui and Hawaii Island.

The CGS scheme has proved far more favourable amongst consumers, which mounted pressure on the scheme. According to a report by Hawaii Energy Law Services, as of this week, more than 2,000 applications for CGS were filed since December 2015. Conversely, in the same timeframe, fewer than 20 CSS applications have been filed.

In fact, the accelerating pace of rooftop applications under the grid-supply tariff meant that the utility in Maui could fulfil its quota as soon as June, and likely fill any outstanding capacity on all islands by the beginning of August – according to the filing with the PUC by the trade groups.

In light of this, industry representatives, including SunPower and The Alliance for Solar Choice, advanced to the PUC with a request to adjust the cap.

“Adjustment of the cap will also provide more certainty to the solar market and help maintain the industry’s interim viability,” the group said in the regulatory filing.

Opposition to increasing the CGS cap

Notwithstanding the plea, HECO and the state division of Consumer Advocacy both opposed the group’s motion to adjust the grid supply tariff cap in separate filings with the PUC on Wednesday. The Consumer Advocacy rebutted that the motion “fails to establish why such an increase in the customer grid supply (CGS) tariff cap would be in the overall public interest, and instead relies heavily on an arbitrary assumption regarding the acceleration of the rate at which CGS capacity would be filled and arguments regarding the industry’s self interest.”

HECO began its opposition by stating that extending the cap may not be necessary, as 13,000 applications for rooftop solar under the scheme have been approved but not yet installed. “…if even a small percentage of those customers are found to no longer be interested in pursuing installation of their rooftop PV system that could free up capacity for customers who are,” it added.

According to local reports, HECO, through its lawyers, stated this week that there is a finite amount of load to be served, and the state and the PUC need to determine how best to serve this load so that it is both cost effective and reliable for all customers.

“As the commission has previously recognized, Hawaii has done a tremendous amount to become a world leader in the integration of renewable resources,” the utility’s attorneys said. “It is also well on its way to achieving the state’s goal of 100% [renewable energy by 2045]. Along these lines, the state and commission have made clear that a diversity of both resources and programs will be necessary to achieve these goals and no longer can be a single program or resource be allowed to dominate utility resource procurement unless it has been determined that this is the right thing to do on a comprehensive basis.”

In the event that the caps are reached, HECO said the CSS tariff should serve as the primary programme for customers “until new options could be developed through the regulatory process.”

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