The solar industry continues to struggle as the number of photovoltaic building permits issued in June dropped to the lowest level in 15 months.
The City and County of Honolulu issued 368 PV permits last month, a decline of 41 percent from 632 in the year-earlier period, according to data from Marco Mangelsdorf, who tracks rooftop solar permits and is president of Hilo-based ProVision Solar.
Mangelsdorf said the industry is living off of a backlog of solar systems that were approved to be a part of a solar incentive program the state ended last year.
“(It is) kind of amazing that the industry is still doing as well as it is living off of the accumulated fat of a program that was closed down eight-and-a-half months ago,” Mangelsdorf said in an email Monday.
In October, the state Public Utilities Commission ended a popular incentive program that offered owners of solar-energy systems a credit equal to the retail rate for the excess energy that their systems sent into the grid. This program resulted in many solar system owners lowering their electric bill to approximately $17.
The PUC replaced the former program with two options considered less attractive by the local solar-energy industry.
Only one of the two programs, called grid-supply, allows customers to continue exporting excess energy into the grid.
Grid-supply credits new solar owners 15 cents a kilowatt-hour for the extra energy their solar systems send into the grid, roughly 8 cents less than the retail rate that had been offered through the original program. The PUC also put a 35-megawatt limit on the total amount of energy generated from the grid-supply program statewide. Oahu’s limit is 25 megawatts, and Hawaii island’s limit is 5 megawatts. Maui County’s limit is 5 megawatts.
The other option, self-supply, encourages the use of solar-plus-battery systems because participants in the program are not allowed to send excess solar energy into the grid.
The solar industry has been slowly adapting to the loss of the incentive program as solar companies in recent months have reported having to cut staff or move their business to the mainland.
“Business has definitely been slowed by the closing of NEM and the issuing of the other two programs instead,” said Leslie Cole-Brooks, executive director of Distributed Energy Resources Council of Hawaii. “It has definitely had an impact on the local industry, no doubt.”
On top of losing its primary sales pitch, the industry has recently run into more problems, as the islands are inching closer to the limit the state put on the grid-supply program.
In late June, Maui Electric Co. announced it will not approve any new rooftop solar systems on Maui, Lanai or Molokai that send power to the grid because Maui grid-supply systems met the limit set by the state.
Maui County residents who want to install new solar systems will now have to buy batteries to hold any excess power generated by the panels. They can still draw power from the grid when needed, but can’t send power to the grid.
Members of the solar industry have requested that the PUC increase the cap.
Cole-Brooks said that the grid-supply cap should be increased because the self-supply program is too limiting. Cole-Brooks said that for self-supply to work there needs to be a time-of-use program, a program designed to encourage customers to use more energy during off-peak hours and when solar power is strongest.
“Ideally they would increase the cap and present the time-of-use program,” Cole-Brooks said. “It’s more powerful if customers are incentivized to use rooftop solar plus storage.”
