Hawaiian Government, Utilities Sign Energy Agreement

HAWAII – On October 20, 2008, an Energy Agreement was signed by the State of Hawaii and the Hawaiian Electric Companies (HECO) to accelerate the accomplishment of Hawaii’s energy objectives in the regulated electric utility sector. Of note, this agreement indicated that net metering in Hawaii will eventually be replaced by a feed-in tariff. In the agreement, the HECO utilities and state government agreed to:

• Support the installation of third-party and customer PV systems through feed-in tariffs that offer known, stable pricing terms and standardized interconnections;

• Support the modification of Hawaii’s net metering option to include provisions for the annual sale of customers’ NEG at the feed-in tariff rate (or at a somewhat lower fixed rate) to fairly balance the option risks available in all customer options;

• Require net metered installations to incorporate time-of-use metering equipment and, when time-of-use (TOU) rates are implemented on a full scale basis, allow the net metered customer to move to TOU net metering and sell NEG.

HECO will request approval from the state Public Utilities Commission, by July 2009, for a feed-in tariff system which would require the utility to publish in advance the rates it will pay for renewable power.

Hawaiian Electric Companies agreed that there should be no system-wide caps on net-energy metering for residential and commercial renewable energy projects. Instead DG interconnection will be limited on a per-circuit basis, where generation (including PV, micro wind, internal combustion engines, and net metered generation) feeding into the circuit will be limited to no more than 15% of peak circuit demand for all distribution-level circuits of 12kV or lower. It is unclear at this time which of these issues may need legislative approval before the PUC can move forward with implementation.

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