http://www.scientificamerican.com/article.cfm?id=a-solar-boom-so-successfull-its-been-halted
A Solar Boom So Successful, It's Been Halted
Photovoltaics proved so successful in Hawaii that the local utility,
HECO, has instituted policies to block further expansion
By Anne C. Mulkern and ClimateWire
Climatewire
William Walker and his wife, Mi Chong, wanted to join what's seen as a
solar revolution in Hawaii. Shortly after buying their Oahu home earlier
this year, they plunked down $35,000 for a rooftop photovoltaic system.
The couple looked forward to joining neighbors who had added panels, to
cutting their $250 monthly power bills and to knowing they were helping
the environment.
Their plans shifted the day after the PV panels went up in early
October. The Walkers learned from a neighbor about a major change in the
local utility's solar policy. It led to those 18 panels sitting dormant
nearly three months later.
Hawaiian Electric Co., or HECO, in September told solar contractors on
Oahu that the island's solar boom is creating problems. On many
circuits, the utility said, there's so much solar energy that it poses a
threat to the system and a safety issue. Studies are needed on whether
grid upgrades are necessary. If they are, residents adding solar must
foot the bill. And starting immediately, contractors and residents would
need permission to connect most small rooftop systems to the grid.
The new HECO policy was included deep in the text of emails the Walkers'
solar contractor had sent, but it escaped their notice before
installation. They're now paying $300 per month on a loan for the
panels, plus the $250 electric bill.
"It goes from frustration to outrage," William Walker, 33, said of his
reaction. "We hear the excuses that HECO provides, that they put out
there at least as far as the justification. There's really not a lot of
substantiation. My belief is it's purely profit-motivated, to keep
people away from PV and keep them on the grid."
HECO officials called it a needed precaution.
"We can't allow circuits to become dangerous," said Peter Rosegg, a
utility spokesman. "We can't allow circuits to become unreliable because
there's too much PV on those circuits."
The policy change halted what has been a solar surge in Hawaii.
Installations there jumped 169 percent last year from 2011. More than 4
percent of households have photovoltaics. Hawaii last year led the
nation in the portion of its electricity that comes from solar, with 2.6
percent. The Aloha State burns oil to make electricity, and prices for
the fuel have jumped in recent years, igniting demand for alternatives.
The state's tax credit for solar energy made it additionally appealing
(ClimateWire, May 6).
The new struggle on Hawaii foreshadows what the rest of the country
could face as solar moves closer to the mainstream, several involved in
the debate said.
"Hawaii is a crystal ball into what every other state is going to have
to look at as they start reaching higher and higher levels of solar
activity," said Robert Harris, executive director of Sierra Club Hawaii.
"There is a national debate about what is the future model of the
utility. That is happening in real time in Hawaii."
'I am from the future'
The Hawaii development comes amid battles in California, Arizona and
Colorado over the future of net energy metering (NEM). That policy --
which exists in some form in 43 states and the District of Columbia --
lets households with renewable energy earn bill credits for surplus
power delivered to the grid.
Utilities in states with growing levels of solar have argued that fixed
fees and other changes are needed because customers with net metering
bill credits don't pay their fair share of transmission and distribution
charges. The Golden State's Legislature has ordered the California
Public Utilities Commission to retool NEM by 2015. The new program will
need to be "based on electrical system costs and benefits to
nonparticipating ratepayers."
Arizona's utility regulator last month approved a hike in the
surcharge that solar customers with net metering pay the state's largest
utility. The Arizona Corporation Commission ordered workshops to study
the value and costs associated with NEM. Conversations about net
metering are beginning in Louisiana, parts of Texas, Illinois, New York
and Massachusetts (ClimateWire, Dec. 11).
Charles Wang, with the Hawaii ECO Project, at a solar conference in San
Diego earlier this month warned people from other states that Hawaii is
a "cautionary tale" and "something that you will face down the road in
your marketplaces."
"I am from the future," Wang told a room of industry and environmental
representatives. "The utility is that 800-pound gorilla. If you push it
to the corner of the room, it's going to fight back. That's what's
happening right now."
The HECO policy is only for Oahu, but a similar rule already is in
effect on Maui and the Big Island. It's more controversial on Oahu,
however, because it's home to about 80 percent of the state's
population. About 900,000 people live on Oahu.
On Oahu, 10 percent of utility customers will have rooftop solar by
year-end, Rosegg said. That compares with California, where it is 2 to 3
percent, he said. And demand for new connections for PV has been heavy.
"These applications were rolling in at such an aggressive rate. ... We
simply had to get advance notice that these were coming in," Rosegg said.
The utility's grid wasn't designed for power to go two directions,
Rosegg said. The ability for PV to make more power than would be used in
a neighborhood creates a situation where there is "overvoltage." The
energy can flow back to the substation, he said, which can lead to
reliability problems and possibly surges. And if crews are working in
the area, there's a potential danger.
Others say the utility fears more solar expansion and hasn't developed a
plan to adjust.
"It's no doubt a threat, and down the road utilities have to seriously
look at their business model," said Leslie Cole-Brooks, Hawaii Solar
Energy Association executive director. "It's a whole new era because
these technologies are available."
The HECO change has triggered a push for help from the state's
Legislature when it reconvenes Jan. 15. Sierra Club Hawaii and others
are working on potential bills to ease the burden on homeowners.
Measures could include helping the utility make grid improvements, said
Harris with Sierra Club Hawaii. The goal is to make sure more renewable
energy can come online, he said, and to develop a way to pay for it that
is "fair and equitable" for all customers.
System closing soon?
The new edict for Oahu mostly focuses on grid circuits where power
available from rooftop solar reaches or exceeds 100 percent of the
minimum daytime load, the low point of the total power that customers on
a circuit are using. Areas at that level will require interconnection
requirements studies. Circuits at 75 percent could also need the
studies. Residents who want to add solar in other parts of Oahu must
apply with HECO and wait for approval.
About one-fourth of circuits on Oahu are at 100 percent, Rosegg said. At
the current rate of adoption, Harris said, all electrical circuits
controlled by the utility could be closed to small-scale solar within
six months.
HECO, meanwhile, is planning interconnection studies on what it calls
"representative" circuits "already heavily loaded with PV." It will use
the results to evaluate other circuits and tell customers who want to
add solar what they'd need to pay to upgrade the grid. Changes could
include adding grounding transformers or increasing the capacity of a
substation, Rosegg said. The utility's analysis won't be finished until
early next year.
Hawaii's solar market slowed dramatically after HECO's letter. Permits
for photovoltaic projects issued on Oahu fell to 1,246 in October, down
49 percent from a high of 2,433 a year earlier. Last month they were at
1,040, a 48 percent drop from 1,996 in November 2012. Marco Mangelsdorf,
president of ProVision Solar on the Big Island, pulled the data from the
Honolulu County and city planning website.
Before the HECO policy change, Walter's Electric -- based on the Big
Island -- was setting company records for solar installations. The last
three months of the year look especially promising, said company
President Kaimi Walter Chung.
"It looked like we were going to have our best quarter," Chung said. "We
were ramping up to do a lot of jobs."
Now Walter's Electric has 70 customers on Oahu and 50 on other islands
waiting for installation approval. Chung has had to focus more on the
electrical services his company provides.
Other solar companies have developed new sales strategies to attract
business, including selling the idea of independence. Island Pacific
Energy ran a full-page advertisement in the local paper promoting the
idea of buying batteries for solar storage and sidestepping HECO's rule.
"Get solar now," the ad said. "No waiting for utility approval. No added
grid upgrade costs."
Poncho's Solar ran an ad telling people they can opt for batteries and
"avoid those extra costs."
Systems would have to be independent of the grid to sidestep the safety
review and potential grid upgrade costs, Rosegg said.
Disconnecting from the grid is not realistic for most people, Chung
said. The current state of battery technology means they have to be
replaced after a few years, he said. And putting a system with batteries
on a typical house would cost $40,000 versus $25,000 for one without the
storage component, he said. Moreover, the battery portion isn't eligible
for the tax credits.
"Eventually, I guess that's how people are going to have to go, but I
don't think it's feasible" right now, Chung said.
Installing solar without approval
Some customers are going forward with solar despite HECO's new policy.
Ron Hayashi, 61, this week had solar panels installed on his Oahu home,
despite not having HECO approval to connect to the grid. The
neighborhood where he lives already has solar capacity at 100 percent of
the minimum daily load.
Hayashi withdrew money from his 401(k) in order to buy a $14,800 solar
system for his house. He wanted to get it connected by year's end to
take advantage of state and federal tax credits. After factoring those
in, the electric bill savings from the panels will mean the investment
is paid back in just under two years, he said.
Hayashi bought a system with batteries called an "energy shifter" and
believes -- based on what his solar contractor told him -- that HECO
cannot refuse to connect the home once the utility's safety study is
complete. He needs to be connected for the system to work.
"If I use the energy shifter, they cannot refuse you," Hayashi said.
Cole-Brooks with the Hawaii Solar Energy Association said she and other
advocates are talking to HECO about making accommodations for households
that have batteries but want to be connected to the grid. There's not a
safety issue posed by those systems, she said, because extra power is
going into the batteries and not the grid.
But Rosegg with HECO said that right now there is no special treatment
for systems that have batteries. Because there's confusion about the
rules, he said, the utility plans to run an advertisement in the local
paper in a few days cautioning people that even if they are buying
systems with batteries, they need to first contact HECO.
"Nobody has a special dispensation to connect to the grid," Rosegg said.
"Everybody has to go through the process. If an inspection is needed,
we'll do that. If upgrades are needed, we'll do that. Everybody is
treated the same."
--
Darryl McMahon
Failure is not an option;
it comes standard.
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