Few HECO customers try time-of-use program

A Hawaiian Electric Co. pilot program meant to encourage customers to shift energy use to the daytime has seen little interest.

Last year, the state Public Utilities Commission ordered HECO to offer a time-of-use, or TOU, pilot program, which charges residents three different rates instead of one flat rate to encourage a shift of energy use to daylight hours, when the most solar power is produced. The program is aimed at helping add more renewable energy to the grid.

Some nine months since it began, the pilot program is far from meeting its cap of 5,000 participants, according to a quarterly report HECO submitted to the PUC July 19. Since the program began in October, 2,636 people have signed up.

The utility said it is working to build more interest for the pilot, without much result.

HECO sent letters explaining the program to 3,216 customers from April to June, and only 39 customers signed up since the letters were sent.

Most residents who enroll already use most of their energy during the day, such as the state’s retirees. Nearly 40 percent of the households enrolled in the program since its Oct. 19 start reported having at least one retired person. Retirees made up 66 percent of those who answered HECO’s survey.

HECO spokeswoman Shannon Tangonan said that outside of retirees, others who enrolled include shift workers.

“We’re continuing to publicize broadly, hoping it may appeal to shift workers who aren’t home at night,” Tangonan said. “It’s a great program if it can fit your lifestyle, but it doesn’t work for all of our customers. We aren’t focusing on any one demographic. The program is designed for any customer who might benefit from using the most energy in the middle of the day.”

The way the program is set up, HECO customers who work 9 to 5 are less likely to see a financial benefit if they enroll.

In July, the program’s participants paid 25.8 cents a kilowatt-hour between 10 p.m. and 9 a.m.; and they paid 17.1 cents a kilowatt-hour from 9 a.m. to 5 p.m. From 5 to 10 p.m., participants paid 39.4 cents a kilowatt-hour. July’s flat rate, which most customers pay, was 26.3 cents a kilowatt-hour.

Makena Coffman, associate professor of urban and regional planning at the University of Hawaii at Manoa, said the program would be more successful if the time-of-use rates were the default rates and the flat rate was the option.

“For it to be really effective, research has shown that the default matters,” Coffman said. “If everyone is put onto TOU and they are allowed to opt out, for example, it will garner much much more participation, and from a wider range of customers.”

HECO’s pilot program is an opt-in program. There were 290 residents who tried the program and chose to go back to the regular rate structure. Customers are allowed to leave at any time without a penalty.

Brian Kealoha, executive director of Hawaii Energy, the state’s ratepayer-funded energy-­efficiency program, said for the program to be the most effective, there must be enough incentives for people to change their behavior.

“Hawaiian Electric’s rolling out of this pilot program is an important first step,” Kealoha said. “While the number of participants in the program needs to be considered, a true measure of success will be determined by whether enough information has been captured to structure optimal time-of-use rates that will meaningfully shift customers’ energy habits moving forward.”

HECO said data is not available on whether the time-of-use rate created a shift in energy use among the pilot participants.

Kauai Island Utility Cooperative’s yearlong pilot program, which offered a 25 percent discount to residents using energy during daytime hours, did not significantly motivate residents to shift their load from peak evening hours, according to a report in May.

KIUC estimates that the shift of energy use among its 350 participants was 1.5 megawatts, which is about 2 percent of Kauai’s peak usage.