Hawaii reforms utility incentive structure to focus on ratepayer benefits

hawaii solar utilities

Hawaii is reforming the old timey model for how investor-owned electric utilities get paid. Thanks to Governor David Ige signing SB 2939, future utility revenues — in the form of performance incentives or penalties — will be linked to performance metrics. This includes incentives for Hawaiian utilities to connect more customer-sited solar and battery systems.

“This is an important step forward to align the design of our electricity system with the needs of the public,” said Robert Harris, Director of Public Policy at Sunrun. “This new law breaks the direct link between revenues and utility investments in infrastructure,meaning Hawaii’s electric utilities no longer make more money just by spending more. ”

In passing the bill, the Hawaii State Legislature voiced concern about the high cost proposed to modernize the electric grid. Because of misalignment in the way electric utilities get paid, the Legislature was concerned utilities would have “a bias toward expending utility capital on utility-owned projects that may displace more efficient or cost-effective options, such as distributed energy resources owned by customers . . .”

RELATED: Our big takeaway from SEIA’s latest Grid Modernization report: Utilities need to step up

“This bill is a big win for local consumers who will pay less for better electric service with more options for home solar and batteries, and it is a responsible step forward helping utilities transition to a sustainable business model that can survive disruption in the energy sector,” said Hawaii State Representative Chris Lee, Chair of the Committee on Energy and Environmental Protection.

“We need to better align the electric utility’s interests with the public’s interest,” said Anne Hoskins, Chief Policy Officer, Sunrun. “The future is going to be a more dynamic and customer-centered energy system, and we must ensure we maximize public benefit and meet broader economic and environmental goals.”

Sunrun recently published a report detailing recommendations to improve and maximize the public benefits of the United States’ energy system by placing the consumer at the center. With the passage of the Ratepayer Protection Act, Sunrun looks forward to working collaboratively with the utility and others in HI to advance a more reliable, clean and affordable energy system

“Other state Legislatures and Commissions should take notice of Hawaii’s efforts,” said Hoskins. “The time to make these changes is now, before billions of dollars are spent in rebuilding our outdated electrical networks. Rooftop solar and home batteries are allowing use to choose a system that maximizes public benefits, not utility shareholder profits. Let’s keep giving people the freedom to create a brighter future.”

— Solar Builder magazine

These utilities are adding the most solar, storage to the grid

 

The Smart Electric Power Alliance (SEPA) has announced its annual Top 10 lists recognizing the U.S. utilities that added the most new solar and storage to the grid in 2017. Compiled as part of SEPA’s 11th annual Utility Market Survey, the lists include the top utilities in four categories: new solar megawatts and watts per customer, and new storage megawatts and watts per customer.

On the solar megawatts list, Pacific Gas and Electric (PG&E) regained the No. 1 spot this year with 831.3 megawatts (MW), while Southern California Edison (SCE), last year’s No. 1, was second with 547.1 MW. The small town of Madison, Maine took the top spot on the watts per customer list, with 1,819.6 watts per customer (W/C).

Top 10 solar utilities

solar watts per customer

On the Utility Storage Top 10, SCE ranked No. 1 on new megawatts, with 56.2 MW, while the Kauai Island Utility Cooperative (KIUC) was No. 1 in new storage watts per customer, with 415.3 W/C. All Top 10 winners will be recognized at an awards luncheon on April 25 at SEPA’s Utility Conference in Rancho Mirage.

top 10 storage utilities

storage watts SEPA

“Despite a small dip in the general solar market, we are seeing new regional and state markets making gains across the country and across all types and sizes of utilities,” said Julia Hamm, President and CEO of SEPA. “Beyond their impressive numbers, this year’s winners embody a range of strong models for innovation and leadership that our industry will be able to build on as we move toward a clean, smart and resilient energy future.”

This year’s Utility Solar Top 10 lists are based on data provided by 423 utilities, representing around 114 million customers across the United States. The Storage Top 10 lists draw on data from 169 utilities, representing 70.7 million customers. The full lists in all categories are attached.

Three Takeaways

• While California utilities took the top two spots on the solar MW list, the rest of the Top 10 in this category show the ongoing growth of strong regional markets. Rounding out the top five are No. 3 Xcel Minnesota (522.3 MW), No 4 Duke Energy Progress in North and South Carolina (355.4 MW) and No. 5 Xcel Colorado (318.8 MW).

• Nine of the Top 10 utilities on the solar watts per customer list are small municipals or electric cooperatives, underlining the spread of solar in rural communities. Joining Madison on the list are No. 3 Anza Electric Cooperative in California (1,455.5 W/C), No. 4 Clarksville Light and Water in Arkansas (1,202.1 W/C), and No. 5 Pickwick Electric Cooperative in Tennessee (1,195.9 W/C).

• By contrast, the Top 10 lists for storage — both megawatts and watts per customer — show growth still centered in the Southwest and Hawaiian markets, which have high levels of solar. Several utilities in these regions appear on both storage lists, including — SCE, KIUC, Tucson Electric Power and San Diego Gas & Electric.

— Solar Builder magazine

PUC of Ohio seeks public comment after utilities seek higher fixed charges

Ohio utility solar

The Public Utilities Commission of Ohio (PUCO) is kicking off a series of four public hearings around the state over the next two weeks to get public input on AEP Ohio’s proposal to more than double the ‘fixed charges’ residents must pay on their electric bills each month. Fixed charges are the portion of the electric bill consumers pay regardless of what volume of electricity they use, a billing tactic that especially disadvantages those who use the least energy, families who can least afford to pay more, and households that want to support or invest in efficiency upgrades or solar.

PUCO hearings on the AEP fixed charge proposal will also be held in Marietta and Columbus, and commissioners have already been hearing on the issue in writing from concerned residents.

“If my electric bill with AEP rises, it reduces from my budget of food, medication, hospital bills, treatment costs, clothing and any other expense you’d expect to have as a mother,” wrote Michelle Peterson, an AEP customer from the Columbus area. The recent post What Ohioans are saying about fixed charge hikes proposed by electric companies provides additional quotes from letters submitted by Ohio residents to the PUCO on the AEP fixed charge proposal, as well as additional background on the issue.

RELATED: Utilities are dramatically increasing investments in distributed energy 

Around the country, utility proposals for increases in mandatory fixed charges are largely being rejected or dialed back by utilities commissions. In Ohio, AEP isn’t the only utility in the state pushing to raise mandatory fixed charges. Here’s a full roundup:

• AEP Ohio wants to more than double its fixed monthly charge – up to $18.40 a month.
• Duke Energy Ohio wants to nearly quadruple their fixed fee – up to $22.77 a month.
• Dayton Power & Light has a proposal to triple its fixed charge.
• FirstEnergy is expected to announce a fixed-fee hike proposal soon.

— Solar Builder magazine

New system could improve solar power prediction models by 50 percent

solar prediction models

A picaresque day to some. To others, a sky full of landmines. Look out there though … is that a solution on the horizon?

The only thing standing in the way of solar energy, on most days, are clouds. Until we can develop some sort of weather-controlling machine like villains in horrible movie adaptations of comic books, the best defense against a cloudy day is a better forecast of those clouds. Thanks to the U.S. Department of Energy’s SunShot Initiative funding, there may be a better mouse trap on the horizon to do this.

The National Center for Atmospheric Research (NCAR) announced that its Sun4Cast system will be available to utilities and private forecasting companies after three years of tinkering and testing. The group says this system is 50 percent more accurate than current solar power forecasts when it comes to predicting clouds and other atmospheric conditions, which utilities could use to their advantage for optimizing their PV performance and reduce their need to purchase energy on the spot market.

RELATED: Is there a PV storage solution between lead-acid and lithium ion? 

NCAR says across the U.S., this technology could save utilities $455 million through 2040.

The Sun4Cast system has been in development for three years by NCAR in collaboration with government labs, universities including Colorado State University, utilities including Xcel Energy and commercial firms across the country. The project is funded by the U.S. Department of Energy SunShot Initiative. Using a combination of advanced computer models, atmospheric observations, and artificial intelligence techniques, Sun4Cast provides “nowcasts” of solar irradiance and the power that will likely be generated at 15-minute intervals. There is also an extended 72-hour forecast.

Xcel Energy is beginning to use the system to forecast conditions at several of its main solar facilities.

— Solar Builder magazine

New York: Making energy affordable for low-income residents, reforming how utilities make money

new york renewable energy

The New York State Public Service Commission has put in place the state’s first-ever Energy Affordability Policy, which will provide nearly two million low-income New Yorkers with $248 million in direct cost relief each year. The new policy will limit energy costs for low-income New Yorkers to no more than 6 percent of household income – half of what many New Yorkers are currently paying.

“This bold action delivers much-needed relief to New Yorkers and will help expand access to clean energy in every corner of this state,” said Governor Andrew Cuomo. “I’m proud of this great progress toward creating a cleaner, greener and more resilient New York for all.”

An order approved today by the Public Service Commission will immediately increase the number of low-income utility customers receiving monthly discounts from approximately 1.1 million customers to 1.65 million. The Governor has also directed a collaborative effort among state agencies, acting as a low-income energy task force, to develop new strategies so that all of the state’s 2.3 million households at or below 200 percent of the federal poverty level have greater access to clean energy and are better served by the state’s energy efficiency and assistance programs.

The new Energy Affordability Policy is an important part of Reforming the Energy Vision, Governor Cuomo’s comprehensive strategy to fight climate change and grow New York’s economy by investing in clean energy technology and generating 50 percent of the state’s electricity needs from renewable energy by 2030.

Community Solar and microgrids will play a big part on this effort. Low-income communities will also benefit from Community Solar, a REV initiative that allows customers to share in the benefits of solar power even if they live in an apartment or other building that cannot support a rooftop solar system. REV is also encouraging communities to develop their own community microgrid projects. State funding under the $40 million NY Prize community microgrid competition will help communities across New York invest in new energy systems which will ensure critically important institutions such as police and fire stations, hospitals and schools – all of which are facilities that all communities, but particularly LMI communities, depend upon for their safety and wellbeing – can continue operating during and in the aftermath of an extreme weather event.

The PSC also released new revenue rules that diversify the ways power providers can make money. Utilities will now be able to earn returns tied to nontraditional, distributed investments, like using a customer’s PV and demand management to meet power needs instead of new central station capacity.

Advanced Energy Economy Institute and its state partner in New York issued the following statement in response to the groundbreaking order outlining a new revenue model for electric utilities issued by the PSC.

“This order details for the first time how utilities will be able to make money as they transition to a new role as distributed system providers,” said Lisa Frantzis, SVP, Strategy at Advanced Energy Economy, a national business group affiliated with AEE Institute that has been an active participant in the proceeding. “New York is paving the way toward a modern electricity system that takes advantage of the latest advanced energy technologies to improve efficiency, expand the use of distributed energy resources, and offer new options for customers to meet their energy needs. Utilities need to have new ways to generate revenue in a changing electricity marketplace. This order provides a framework for utilities to thrive in their new role.”

“The PSC’s new Order is an important step forward as the REV process goes from innovative ideas to a new framework for utility earnings,” said Anne Reynolds,Executive Director, Alliance for Clean Energy New York. “We are watching REV closely to see how it provides new business opportunities for energy efficiency and renewable energy. We are impressed with New York’s determination to remake the energy landscape.”

— Solar Builder magazine