HECO proposes big PV project at Kahe plant to nip use of oil

Hawaiian Electric Co. is seeking regulatory approval to build the state’s largest solar photovoltaic energy project that would deliver power to the grid at a cost significantly below what the utility pays to generate electricity by burning oil.

The 15-megawatt project, planned for a 50-acre undeveloped parcel next to HECO’s Kahe Generating Station, would be the first PV facility owned and operated by the utility.

HECO has selected SolarCity to build the project, which is subject to state Public Utilities Commission approval.

HECO officials estimate electricity generated by the facility would displace the use of about 1.8 million gallons of fuel oil a year at the Kahe plant. Based on preliminary estimates, that would save ratepayers $64 million in reduced fuel costs over the 30-year estimated life of the project, HECO said. The Kahe station, with 650 megawatts of generating capacity, burns primarly low-sulfur fuel oil to generate electricity.

The solar facility would be able to produce electricity at a cost equivalent to a power purchase agreement with a price of 14.5 cents a kilowatt-hour, according to HECO. That would be significantly below the 22.7 cents a kilowatt-hour it currently costs to produce electricity from oil, HECO said.

For the project to proceed, the PUC would have to approve a previous HECO request to have the commission waive competitive bidding requirements for renewable energy projects on Oahu of more than 5 megawatts in size. HECO requested the waiver from the PUC in February, saying it was seeking to speed up its effort to get more renewable energy on its Oahu grid.

The proposed solar project would be connected directly to HECO’s 46-kilovolt substation at the Kahe station. The proximity of the project to the substation means that it would not diminish the ability of residential and commercial customers in the area who wish to install rooftop PV systems, HECO said.

"This is a unique opportunity that benefits our customers because it allows us to quickly develop more low-cost clean energy," said Ron Cox, HECO’s vice president of power supply.

If successful, the Kahe solar project would be larger than a 12-megawatt PV facility being built by the Kauai Island Utility Cooperative in Koloa.

That project, also being built by SolarCity, was billed as the state’s largest solar farm when it was announced.