Energy Policy

State Policy

For a review of 2009 proposed policies, see the 2009 Policy Package slides. 2010 policy portfolio coming soon.

Public Utilities Commission 

To advance Hawaii’s clean energy goals, Blue Planet is actively involved in legal proceedings designed to promote renewable energy and energy efficiency. These contested case proceedings, or “mini-trials,” are conducted by the Hawaii Public Utilities Commission and involve Hawaiian Electric, state agencies, renewable energy providers, and others. Blue Planet is an official party to these proceedings to advocate for Hawaii’s swift transition to a clean energy economy.

The focus of these proceedings is to open up access to the electric grid and pay renewable energy providers a fair rate, “decouple” utility revenues from sales of electricity, examine a proposed utility program for solar power systems, and update Hawaii’s integrated resource planning process. These proceedings also seek to implement the landmark Hawaii Clean Energy Initiative and Energy Agreement.

Feed-in tariff.

In April 2009, the Public Utilities Commission conducted a five-day hearing on the adoption of feed-in tariffs in Hawaii which drew national media attention. A feed-in tariff, or FIT, is a set of standardized, published purchased power rates, including terms and conditions, which the utility is required to pay to renewable energy providers for electricity provided to the grid. Essentially a type of standard offer contract, feed-in tariffs provide certainty to renewable energy developers and investors, thereby stimulating development and utility acquisition of solar, wind, and other types of renewable energy. In September 2009, the Commission issued a 128-page decision authorizing and establishing general principles for the FIT. Solar, wind, and hydropower are eligible for the FIT, with project sizes not to exceed 5 megawatts on Oahu and 2.72 MW on Maui and Hawaii Island. The total amount of feed-in tariff projects brought onto the electricity grid is capped at 5% of the system peak on Oahu, Maui, and Hawaii for the first two years of the program. Although the price paid to renewable energy providers for their power has not been set, by providing transparent conditions and a “no haggle” price for clean energy, the FIT may enable providers to more easily calculate whether their project will pencil out. For smaller projects, clean energy developers will no longer face costly and time-consuming individual contract negotiations with the utilities. Hawai’i is one of the first states in the nation with a FIT policy.

Decoupling.

In a parallel proceeding, the Commission is considering whether to authorize a similarly innovative regulatory mechanism, known as “decoupling,” that removes the link between utilities’ revenues and profits from its electricity sales. Utilities typically earn a profit by increasing electricity sales. This profit motive may create a disincentive for utilities to aggressively promote reduced consumption through energy efficiency. Decoupling establishes the rate of return earned by the utilities so that it is not pegged to sales of electricity, thereby reducing any disincentive for the utilities to pursue aggressive energy efficiency measures and third-party owned renewable energy systems, while providing them with an opportunity to achieve fair rates of return. In addition, decoupling may include a mechanism to regularly adjust the rate of return earned by the utilities over a longer period of time. Such a “revenue adjustment mechanism,” or RAM, may aid the utilities in maintaining their financial integrity as Hawaii transitions from reliance on imported fossil fuels to clean energy.

PV Host Program.

In April 2008, Hawaiian Electric filed an application with the Commission seeking authorization to start up a solar photovoltaic or PV Host Program that could add up to 16 megawatts of new PV systems over a two-year period. Under the proposal, which is aimed at government and commercial facilities, the utilities would lease rooftops or other space for the systems from property owners. Independent PV developers would then be contracted to install PV systems at these sites. The PV developers would own, operate and maintain the systems and sell the energy to the utilities at a fixed rate under a long-term contract. Hawaiian Electric believes the program will simplify the process of acquiring PV for property owners, promote additional use of solar energy, and to increase business opportunities for Hawaii's PV industry. The interaction between any such PV Host Program and Hawaii’s recently-adopted feed-in tariff remains to be determined. As a party to this proceeding, Blue Planet seeks to ensure the rapid adoption of solar power in the most efficient and cost-effective manner.

Clean Energy Scenario Planning.

Careful planning is required to meet Hawaii’s clean energy goals. Integrated Resource Planning, or IRP, has been relied upon since the early 1990s as a planning process to provide public input to the utilities’ efforts to increase renewable energy on Oahu, Maui and Hawaii Island. As an advocate for Hawaii’s swift transition to a clean energy future, Blue Planet seeks to promote resource planning that facilitates the rapid adoption of renewable energy and increased energy efficiency. The most recent master plan for Oahu, known as IRP 4, was recently terminated by the Commission. Concurrently, the Commission opened a proceeding to amend the framework for all IRP planning and decision-making. Referred to in the Energy Agreement and by the utilities as “Clean Energy Scenario Planning,” the updated framework is intended to guide various aspects of resource planning, including the types of plans, review and updating processes, coordination of the plans with other clean energy initiatives, review and updating of the plans in response to rapid changes in energy policy, and the role of advisory groups and enforceability of the plans.

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For more information on PUC proceedings, go to: http://puc.hawaii.gov/