HECO cleared to pursue negotiations to buy low-cost PV power

State regulators have given permission to Hawaiian Electric Co. to waive competitive bidding requirements as the utility negotiates contracts with developers to buy low-cost solar power from three utility-scale photovoltaic projects on Oahu.

The three projects are among nine that HECO wants to put on the fast track to allow developers to take advantage of federal tax credits that are due to expire at the end of 2016.

The state Public Utilities Commission on Thursday cleared HECO to move forward with plans to buy power from the three projects with a total generating capacity of 33 megawatts.

The power would be priced below a levelized price of 17 cents a kilowatt hour over the 20-year term of the agreement, according to the PUC. That compares with the approximately 22.5 cents per kilowatt hour HECO pays to generate electricity from oil at current prices.

HECO told the PUC it expects the solar projects to reduce its generation costs by $3.1 million a year, or $62.5 million over the 20-year period.