Posts Tagged ‘Hawaii PUC’

11 March

Post Hoc Ergo Propter Hoc

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Dear Friends, Visitors/Viewers/Readers,

Sunshine of Hawaii (credit: sunisthefuture-Susan Sun Nunamaker)

Sunshine of Hawaii (credit: sunisthefuture-Susan Sun Nunamaker)

 (Please click on red links & note magenta)

I’ve received a call from some one in Hawaii today, mentioning the likelihood/resistance of NextEra-Hawaiian Electric merger . It’s been months since I last read up on Hawaiian Electric Co., a quick research made me realize that even though both Hawaii and Nevada are going through growing pains, showing similar signs and symptoms, but their pains actually have very different root causes.  In Nevada, the Nevada PUC (Public Utilities Commission) is reacting to the solar growth by implementing policy to stifle the distributed solar rooftops, without considering Value of Solar (the most fair way for consumers and power generators alike) or potential long term consequences for NV Energy. But in Hawaii, the Hawaii PUC (Public Utilities Commission) actually has established reforms through a collaborative process that will support further sustainable growth in the market for rooftop solar systems and other distributed energy resources (“DER”) desired by Hawaii’s residents and businesses.

View from a Hawaiian island, Kauai (credit: sunisthefuture-Susan Sun Nunamaker)

View from a Hawaiian island, Kauai (credit: sunisthefuture-Susan Sun Nunamaker)

For better understanding of Hawaii PUC’s Reform Energy Programs issued on Oct. 12, 2015 , please click HERE. This order will promote rapid adoption of the next generation of solar PV and other distributed energy technologies, encourage more competitive pricing of DER systems, lower overall energy supply costs for all customers, and help to manage each island grid’s scarce capacity.  The Commission views distributed energy resources (including rooftop solar PV) as an important contributor to meeting the state’s 100% renewable energy goal, complemented by the recently enacted community-based renewable legislation and larger utility-scale projects (source: from http://www.puc.hawaii.gov).

One important element needs to be understood and appreciated by all is the fact that as more and more people install solar, in any form, the value of solar will be lowered. Since Hawaii does want to have a fair system that would be inclusive as well as ensuring all customers to benefit from continued growth in distributed solar energy, the rate needs to be re-evaluated periodically to reflect the actual Value of Solar (fair way of valuing solar for all) that changes with time. As more solar installations are in place, the NEM (Net Energy Metering) is no longer as feasible because it will not be valuing solar fairly for all. If there should be any displeasure resulting from the fact that NEM is on its way out when the possibility of NextEra-Hawaiian Electric merger is being discussed, that is purely  Post Hoc Ergo Propter Hoc or post hoc fallacy: a simple example of this phenomenon–> the rooster crows immediately before sunrise;therefore the rooster causes the sun to rise. It is not surprising that the Hawaii PUC has proposed caps on the NEM program, for NEM is on its way out simply because it has already served its useful purpose and now requires some enhancement in order to be fair for all. If Hawaii PUC does not place caps on NEM, then Hawaiian residents who install solar may fall into the trap similar to Nevada residents who install solar, ending up with a monthly fixed surcharge.

What is brilliant and insightful about Hawaii PUC is the fact that this Commission has not only placed caps on NEM, but also offered three new options for customers who wish to invest in rooftop solar and other distributed energy resources (DER), in italics (Source: http://puc.hawaii.gov/wp-content/uploads/2015/10/DER-Phase-1-DO-Summary.pdf) :

  1. Self-Supply” systems:  for customers that primarily intend to consume all of the energy produced by their solar system onsite at their home or business, and do not need to export excess energy to the grid. These systems will typically be designed to use energy management and energy storage systems to balance onsite generation with demand. With these advanced features, self-supply systems have reduced technical impact on the grid and will receive expedited interconnection review. At this time, there is no cap on the number of Self-Supply systems that may be installed.
  2. Grid-Supply” systems: this  will allow customers to export excess energy to the grid as needed, and customers will receive energy credits on their monthly bills, similar to the NEM program. The Grid-Supply option does reduce the credit rate for energy exported to the grid for participating customers, and as a result, it will reduce the overall cost of each island’s renewable energy portfolio, which benefits all customers (including those who do not have the ability to install DER). The lower credit rate for energy exported to the grid reflects the Commission’s commitment to achieve an affordable, cost-effective energy supply for all customers. There is a cap on the total capacity of Grid-Supply systems to ensure each island grid can accommodate GridSupply systems, complemented by community-based renewable projects, and lowercost utility-scale projects.
  3. Time-of-Use” tariffs: – The Commission has also directed the HECO Companies to develop a new, expanded time-of-use tariff that allows customers to save money by shifting energy demand to the middle of the day to take advantage of lower-cost solar energy. Initially, this tariff will be available for any residential customers that opt-in to the program. By sending the right price signals to customers, customers can increase energy demand during times of high solar supply and alleviate some of the grid constraints to further renewable integration. This new tariff will also spur investment into new “smart home” and “smart business” technologies that can help customers take advantage of this program. 

*The time-of-use tariff of Hawaii is similar to the Value of Solar that’s been discussed in various discussions with Karl Rabago, below:

 

 

 Karl Rabago’s comments about NEM and Value of Solar Tariff/Time of Use Tariff, below:

 

~have a bright and sunny day~
Any comments, suggestions, concerns regarding this post will be welcomed at sunisthefuture@gmail.com

Gathered, written, photographed, and posted by sunisthefuture-Susan Sun Nunamaker
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