Column: Social equity fund for renewable energy

Before COVID-19 struck, a homeowner in Honolulu told me that he felt guilty. He had been an early adopter of solar panels and as a result of the generous state tax write-off, the net energy metering system (NEM) enabled him to pay for the system years ago; he now paid only a small amount for more electricity than he could use.

He and his friends, who also had the income and the means to sign up for the NEM program, represent nearly 70,000 people, 15% of Hawaiian Electric’s total, mostly living in Hawaii’s most affluent areas. Many of them have added big-screen TVs and other amenities because electricity costs them virtually nothing. All have increased the value of their properties by $35,000 just by having solar.

Since then, many other programs have taken place beyond NEM and the number of solar panels now reaches nearly 33% of the residential homes in Honolulu. Unfortunately, the many millions of dollars in state subsidies spent to make Hawaii fossil-free in the effort to meet the climate change goals has made more evident preexisting problems of energy poverty. Because Hawaii has the highest price of electricity in the U.S., many on fixed incomes can barely afford access to electricity and hot water to bathe and wash clothes.

According to the latest state of Hawaii data, a typical homeowner with solar panels pays 2% of their income on energy. A low-income family can pay between 15% and 25% on electricity, leaving little for food and other expenses.

How bad is this situation?

According to Hawaiian Electric (HECO): In a typical year, 1% of its customers, approximately 4,000 people, have their power cut off for nonpayment. This impacted an estimated 12,000 people — predominately low-income, including the elderly, single mothers, their children and the unemployed.

Since COVID-19, the number of HECO customers unable to pay has reached 4% — 16,000 customers — impacting an estimated 48,000 men, women and children.

The problem is made worse because those behind on their payments typically owe $1,500 in back payments. There is currently a moratorium on payments, but beginning May 2021, all those who are behind in their payments will be expected to pay some amount of this back.

To help provide assistance, HECO is sponsoring a Special Hawaii Utility Bill Assistance Program with donations from their own employees and Aloha United Way. So great was the need that the fund was gone two days after being posted; 6,553 claims were processed by March of this year.

Additional federal funding for energy is going to be made available from the city’s Office of Economic Revitalization. However, there is only a limited amount of money in this fund, too.

The answer to this problem can be found in several ways:

>> Use existing programs like Hawaii Energy and the state GEMS program to help low-income families obtain the financing needed to reduce their energy bills by installing technology, such as solar hot water, that can quickly reduce their energy loads.

>> Create a social equity fund. This is a simple solution. An additional fee of a set amount is placed on the thousands of home owners who have paid off their solar panels and now pay only a nominal grid tie fee — like a bill for public television on a cable bill. These fees would go into an interest-bearing account to fund a guaranteed minimum amount of electricity to qualifying vulnerable groups like the elderly poor and the disabled.

One might ask why it is necessary to eliminate energy poverty in Hawaii. Because fair access to electricity should also be one of the Hawaii’s energy goals.

Michael Markrich is is owner of Kailua-based Markrich Research and a freelance writer.