The state Public Utilities Commission issued four separate orders Tuesday aimed at pushing the Hawaiian Electric Cos. to accelerate their efforts to reduce electricity costs and accommodate greater amounts of solar energy generated by utility customers.
The most significant of the four rulings was the PUC’s rejection of HECO’s proposed "integrated resources plan," a 2,200-page document produced by the utility outlining its strategy for meeting the energy needs of its customers over the next 20 years.
The rulings require the HECO companies to file a series of "action plans" with the PUC within 120 days outlining their progress toward meeting various benchmarks.
HECO must "aggressively pursue energy cost reductions, proactively respond to emerging renewable energy integration challenges, improve the interconnection process for customer-sited photovoltaic systems, and embrace customer demand response programs," according to a news release from the PUC.
The PUC’s action is meant to ensure that HECO is not left behind "in defining the utility of the future," PUC Chairwoman Hermina Morita said at a news conference.
"In Hawaii this is not an abstract concept. The high penetration of renewables in our electric system, high energy costs, changing customer expectations and evolving technologies — we are at the leading edge of this energy transformation," said Morita, flanked by Gov. Neil Abercrombie and the two other PUC commissioners, Mike Champley and Lorraine Akiba.
Morita and the other news conference participants would not respond to questions after the 20-minute event.
HECO officials, who did not participate in the news conference, issued a statement later saying they welcomed the "clear direction and roadmap" provided by the PUC’s rulings.
"We’ve been working on many of these initiatives, and these directives confirm the energy policy priorities that will guide our strategies and implementation," said Dick Rosenblum, HECO president and chief executive officer.
"We have many of the building blocks already in place, including our grid modernization work, the initial phase of our smart grid project, and our progress in renewable energy — now at more than 18 percent. We’ve begun deactivating older fossil fuel plants, such as Honolulu Power Plant and others on Maui and Hawaii island. And we’re taking other steps to lower costs to customers, such as use of low-cost liquefied natural gas as a transition fuel," Rosenblum said.
"We look forward to working with the PUC and the Hawaii State Energy Office as we move forward to develop and execute these comprehensive plans."
In addition to the four regulatory orders, the PUC issued a 30-page "white paper" summarizing its concerns with HECO’s integrated resource plan.
The plan "appeared to be, in part, a series of unrelated capital projects without strategic focus on the clear issues facing the utility, and did not indicate further progress towards a sustainable business model," according to the white paper.
"To date, the commission has not observed sufficient urgency by the utility in addressing this rapidly changing business environment and was compelled to offer this guidance to better align the HECO companies’ business model with customers’ interests and public policy goals."
The white paper also was critical of HECO for not being better prepared for the surge in rooftop photovoltaic installations. The PUC noted that penetration of PV panels on Hawaii’s electrical grids is among the highest in the country.
"Therefore, it is incumbent upon the HECO companies to plan for and address DER (distributed energy resource) interconnection challenges and simultaneously move forward aggressively to develop and garner stakeholder support for the modernization of its transmission-and-distribution grids to further enable integration of DER and to provide customers with critical information to make sound energy choices," according to the PUC.
Abercrombie did not reappoint Morita to the PUC, instead opting to keep her in the position on a "holdover" basis after her term expires June 30 until a successor is nominated and confirmed by the Senate.
Indications that Abercrombie would not be reappointing Morita surfaced in February when Senate leaders said they were told by the governor’s staff that he would not be submitting her name in the nomination process.
Morita made headlines later when it was disclosed that she and her husband were being investigated by the Board of Land and Natural Resources for allegedly building and operating an illegal Kauai bed-and-breakfast. Abercrombie said in March that Morita would continue to serve while the board looks into the B&B issue.
