Residential, State Efforts for More Solar Increase

Molokai residents are eager to install photovoltaic (PV) panels on their roofs to reduce their energy bills and malama the environment. But current technology limits the amount of renewable energy that can be fed into the island-wide electricity grid while maintaining reliability of electric service, according to Maui Electric Company (MECO).

Because renewable energy is a variable source — solar, for example, only generates energy during the day — MECO says relying heavily on renewable sources can cause instability in electricity service. To solve this problem, utility companies, in conjunction with the state Public Utilities Commission (PUC), have established various threshold levels, also known as penetration limits, to regulate the amount of renewable energy on each circuit. These thresholds are measured in percentages of renewable energy based on an electric circuit’s total electricity load.

Red areas show circuits that have reached penetration limits for renewable energy. Map courtesy MECO

Recently, three of Molokai’s five circuits that make up the island’s electricity grid have reached penetration limits, according to MECO maps.

That does not mean customers living in those areas cannot install PV systems, but it does trigger a review process by MECO before installation can take place. That review, called an Interconnection Requirement Study, or IRS, costs about $3,000 for residential PV systems up to 10 kilowatts (kW), can take months, and may include additional costly equipment before a homeowner can install PV. The IRS tests the impact that proposed system will have on the entire circuit.

Customer Frustrations
The delays and extra cost of the IRS process is causing frustration among customers trying to install PV. And because many Molokai circuits only recently reached threshold values, triggering the IRS process, many people are now having to wait when their neighbors were able to install solar panels just last month without a hitch.

“I feel it’s not fair,” said PV applicant Maria Watanabe, who recently received a letter from MECO informing her she would need to complete the IRS. “I have some friends who were able to get solar without the study. How come we have to wait?” She said installing solar panels on her roof will reduce her monthly electric bill from about $200 to about $20.

Rising Sun Solar Molokai representative Matt Yamashita said the east Molokai circuit reached the threshold about a month ago, and left 10 customers in limbo.

“Making people pay $3,000 when their neighbors didn’t have to pay that fee a month ago is… very frustrating for customers,” he said. “They don’t want to wait a year because MECO doesn’t give us indication if the limit will be expanded in that area soon.”

MECO did not give a response as to when those penetration limits might be increased to allow more renewable energy, but spokesperson Kau`i Awai-Dickson confirmed the company is working toward that goal.

“We’re pursuing technical solutions that would help us safely and reliably integrate even higher levels of solar power on Molokai and across the state,” she said via email. “For example, we are currently pursuing an opportunity to use federal funding to install a battery energy storage system on Molokai, which could help regulate voltage fluctuations from photovoltaic systems.”

Maui County Energy Commissioner Doug McCleod acknowledges the frustrations of customers and solar installers, but does not see the threshold values as bar to residents installing PV.

“The most amazing statistic to us is… there’s actually no one out there who has been turned down [by MECO] after they pay the $3,000,” he said. “You’re going to have to plan for a little longer, but the economics [of getting PV] haven’t really changed.” With the cost of equipment and installation dropping with today’s “unbelievable interest in solar,” McCleod said even with the extra $3,000 IRS cost, the price is about the same as it was just a few years ago.

“It’s a good time to get PV as long as you take into account extra time for the IRS,” he said.

The Process
In order to be approved to install a PV system through MECO, applications must go through a series of screening criteria, according to Mat McNeff, MECO manager of renewable energy services department, in a Dispatch interview last fall. One criterion is that renewable energy cannot exceed 15 percent of a circuit’s peak load, averaged over a year. On a daily basis, electricity usage fluctuates — for example, in the evening, when people come home from work, cook dinner and run the air conditioner, the energy load is higher than during the night.

As of December 2011, a secondary threshold — as part of a process called supplemental review — was added to the screening process. In addition to the 15 percent of peak load, circuits were also evaluated by the amount of energy coming from renewable sources at minimum load – the limit was 50 percent. Last October, that value was increased to 75 percent for single-phase PV systems up to 10 kW. That means over the span of one year, MECO calculates the circuit’s average minimum load, and renewable energy integration cannot exceed 75 percent of that value.

There are many variables relating to the circuit that determine whether the 15 percent maximum or the 75 percent minimum will be higher. In circuits where the 75 percent threshold is greater, more residents were able to install PV systems even if the circuit has already reached the 15 percent maximum threshold. Before October, several of Molokai’s circuits had already reached the 15 percent level, so when the 75 percent minimum load value was added, it opened up some areas for additional PV installation without the IRS.

Now, three Molokai circuits have reached both values, triggering the additional study. The results of the study may conclude that no upgrades are required and the system may be installed. Or, to address certain issues, additional equipment or expense may be required, said McNeff.

Statewide Efforts
With the State of Hawaii’s lofty goal of 70 percent clean energy use by 2030, efforts are ongoing to improve both technology and procedures that currently limit the amount of renewable energy that can be integrated.

“Increasing penetration limits… is an effort we’ve been spending a lot of time on,” said Mark Glick, energy administrator for the state Department of Business, Economic Development and Tourism. He said one of the state’s main efforts has been focused on the Reliability Standards Working Group, a team of energy experts established by the Public Utilities Commission to review and analyze circuit loads throughout the state and recommend a much more robust set of standards, according to Glick.

“What came out of that… is something called the ‘proactive approach’ for [PV integration],” he said. “The concept is… to move beyond arbitrary limits set by the utilities and outline a timetable to implement an approach that really encourages the utilities to take on more of the interconnection studies to understand much better those circuits that might be near the limits and do analysis so it won’t be worn on the back of ratepayers. We’re hoping that that will mean that each [PV] project will continue to be approved in most areas.”

In addition, Glick said a series of independent standards will be adopted by the PUC and a new position, a “reliability administrator,” will be created to make decisions and oversee future energy projects rather than the utilities. Glick said the position should be in place in the next 12 to 18 months, with the PUC currently “working feverishly to develop procedures.” The goal, he said, is to achieve greater integration of renewable energy and a better approval regime for such projects.

“Don’t be discouraged,” Glick said to Molokai residents, “because we’re going to overcome the limitations and continue to pursue strategies to set more robust standards and create higher degrees of PV penetration — we have to.”

Until then, Molokai residents like Watanabe will continue to wait extra months and potentially pay thousands to install renewable energy for their homes.