HECO timing plan short on incentive, groups tell the PUC

Solar companies and energy advocate organizations say more incentive is needed for Hawaiian Electric Co.’s time-of-use program to encourage customers to use more energy during off-peak hours when solar power is strongest.

In a filing Monday, Blue Planet Foundation, Hawaii Solar Energy Association, Hawaii Renewable Energy Alliance, Ron Hooson, Life of the Land and the Alliance for Solar Choice submitted a joint response to a proposed time-of-use program that HECO submitted Nov. 13 to the state Public Utilities Commission. The state Department of Business, Economic Development and Tourism filed suggestions separately.

In its proposal, HECO laid out its plan for an optional time-of-use rate program for customers on Oahu, Hawaii island, Maui, Molokai and Lanai. Under the time-of-use proposal, customers who opt in to the program on Oahu would pay 11.04 cents per kilowatt-hour from 9 a.m. to 4 p.m., 36.20 cents from 4 p.m. to midnight and 13.68 cents from midnight to 9 a.m.

The solar and clean-energy organizations said the proposed time-of-use rate program has the potential to cause problems.

The groups said the rates should encourage photovoltaic owners to use more energy midday, but that customers who are a part of the new solar program that credits solar owners 15 cents for the excess energy sent to the grid might be incentivized to do the opposite. The joint filing said that if the time-of-use rate is lower than what the customer would be credited, the customer paying the 11.04-cent rate would allow excess energy to be sent to the grid instead of using the energy or storing it in a battery and exporting it later in the evening.

The groups said the credit for exported power from solar systems should match the rate customers pay in time-of-use because it would encourage solar customers to buy the necessary equipment, such as energy storage systems, to send back excess energy when the grid needs it most. The groups also said that crediting customers the same amount that they would pay using time-of-use would be easier to understand.

“Unless you give customers the benefit as well as the burden, with time-of-use pricing, no one is going to sign up,” said Isaac Moriwake, attorney for Earthjustice. “You are asking customers do a major lifestyle shift. You need to volunteer to have your evening pricing hiked up. Who is going to do that unless they have the benefit on the other side?”

DBEDT said more research has to be done to determine how residents with solar using time-of-use should be compensated for excess energy.

“A sufficient record has not been established to determine what an appropriate level of compensation would be for particular electric service,” said the state Energy Office, which is part of DBEDT.

The clean-energy groups and solar companies said the peak period for time-of-use rates should be consistent across all time-of-use programs that HECO offers, such as HECO’s proposal for electric vehicle time-of-use. Under HECO’s proposed EV time-of-use program, Oahu customers would pay 10.73 cents per kilowatt-hour from 9 a.m. to 3 p.m., 42.72 cents per kilowatt-hour from 3 to 9 p.m and 13.79 cents from 9 p.m. to 9 a.m.