| This story has been corrected. See below. |
The money Hawaiian Electric Co. and its subsidiaries lost because of customers installing solar photovoltaic systems nearly doubled in 2013 from the year before, HECO reported in a regulatory filing.
Lost electricity sales on Oahu, Hawaii island and in Maui County totaled 381 million kilowatt-hours in 2013, up from 206 million kilowatt-hours in 2012, HECO disclosed in a report filed last week with the Public Utilities Commission. Although the amount has increased in recent years due to growth in PV installations, it still represents a small fraction of the roughly 10 billion kilowatt-hours of electricity sold annually by the HECO companies.
The lost kilowatt-hour sales last year meant that the HECO companies were not able to collect an estimated $38.5 million that would have gone to pay for systemwide fixed costs, such as employee salaries and maintenance for transmission lines and power stations, according to the report. That was up from $18.9 million in 2012.
HECO is required by the state Public Utilities Commission to report the estimate of uncollected revenue as part of an annual review.
Although owners of photovoltaic systems are able to generate their own power when there is enough sunlight hitting their panels, they still have to rely on HECO when clouds roll in and at night. HECO is obligated to provide them with electrical service even when they aren’t helping to pay for the fixed costs that HECO needs to collect to keep its system functioning.
As more HECO customers install PV systems, the rate base used to pay those fixed costs shrinks.
"Lost kilowatt hour sales shifts the cost responsibility of these surcharges to other customers," HECO officials wrote in the report, called the Net Energy Metering Status Report.
Not all HECO customers are able to install PV systems as quickly or as cheaply as they would like. In some cases the HECO companies have charged homeowners for equipment upgrades, such as new transformers, before allowing the homeowners to hook their PV panels into the grid in areas already saturated with solar power.
The questions of who should be responsible for various costs associated with the transition to renewable energy and whether HECO is doing a good job of leading the way were topics of a discussion Tuesday at a hearing on a bill that would increase legislative oversight of the utility. The measure, House Bill 1999, would create a task force to review HECO’s state-approved franchise to ensure it is operating in the best interest of its customers.
"What we really want to get is a process … so that we can ensure folks pay fairly what they owe for the services they get and no one is left holding the bag at the end of the day," said Rep. Chris Lee (D, Kailua-Lanikai-Waimanalo).
The bill was advanced by the House Energy and Environmental Protection Committee on an 8-1 vote.
A HECO official testified against the bill, saying the utility’s performance is already reviewed by the state Public Utilities Commission.
"The commission monitors the companies’ performance on an ongoing basis, as the companies file more than 400 compliance reports a year," testified Kevin Katsura, HECO associate general counsel.
Rep. Cynthia Thielen (R, Kailua-Kaneohe Bay) questioned whether HECO was committed to making the transition to renewable energy.
"I don’t see your CEO (Richard Rosenblum) taking it seriously enough to come to the Legislature to speak to us and to say, ‘Yes, we recognize things have changed dramatically.’ They’re going to even change more with the battery storage availability, with the micro grids being invented. And I don’t see Hawaiian Electric feeling that it’s going to come and partner with the Legislature to try to work things through," Thielen said.
Katsura responded, "I apologize. I really don’t want my CEO’s lack of presence here to have any bearing on our commitment to moving the utility forward. He’s very committed."
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Correction: Photovoltaic systems have taken a toll on Hawaiian Electric Co.’s electricity sales, not earnings as was stated in the headline on an earlier version of this story.
