Hawaii PUC Issues Order Implementing a Feed-in Tariff

On October 13, 2010, the Hawaii Public Utilities Commission issued an order approving feed-in tariffs (FIT) for the Hawaiian Electric Companies for renewable energy generators of up to 500 kW in size, to facilitate the acquisition and development of renewable energy in Hawaii. The approved tariffs include applicable pricing, terms and conditions, a standard form of contract, and queuing and interconnection procedures for the FIT program.

The Commission previously issued general principles for the FIT program, and encouraged the parties to the Commission’s FIT docket (Docket No. 2008-0273) to first focus on developing tariffs for renewable energy generating units of up to 500 kW, to facilitate the immediate implementation of a FIT for generators of this size. The Commission and parties to the docket will next focus on developing a FIT for larger generating units of up to 5,000 kW (i.e., 5 MW).

FITs provide standardized pricing, terms and conditions, and procedures that are intended to afford the renewable energy project developers with clear, consistent guidelines that accelerate the completion of the renewable energy projects and provide some assurance of adequate compensation to cover the developer’s reasonably incurred costs.

In the order, the Commission noted that the parties were unable to reach consensus on all issues and acknowledged that there may be a multitude of alternative ways of implementing FIT and virtually unlimited adjustments that could theoretically be made to the program. In the Commission’s view, however, none of the issues that were raised with respect to the Hawaiian Electric Companies’ proposed FITs appeared to be fatal flaws that warranted any further delay in the development and implementation of the FIT program. The Commission stated that the better course is to proceed, learn from experience, and make necessary changes and improvements upon the Commission’s next opportunity to review the FIT program in two years.

The Commission’s order and entire docket record may be accessed by searching for No. 2008-0273 in the Document Management System at: http://dms.puc.hawaii.gov/dms/.


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