KIUC: ‘Changes in policy are necessary’

LIHUE — KIUC on Monday filed its comprehensive DER proposal with the Hawaiʻi Public Utilities Commission designed to maximize the benefits of distributed energy resources for interconnected KIUC members/customers and KIUC’s utility grid system.

If approved, the proposal, which was filed in accordance with the PUC’s procedural requirements, would allow members/customers two options when deciding whether to install solar photovoltaic (PV) at their homes or businesses.

“Changes in policy are necessary due to the extremely high penetration of solar resources during daylight hours,” stated David Bissell, president and chief executive officer of KIUC. “Daytime export is no longer feasible when there isn’t adequate load to support it. This proposal could pave the way for more export in a way that benefits all KIUC members and the grid as a whole.”

The DER proposal, which proposes to revise KIUC’s current Schedule Q rate schedule, would create two options: Customer Self-Supply and Smart Export, which would replace the Non-Export and Export options currently reflected in the Schedule Q rate schedule. The proposal would also substantially “grandfather” the current export energy status of “Legacy” Schedule Q customers, for as long as they continue to use their existing systems.

Customer Self-Supply allows a member/customer to install a solar PV or PV/battery system that meets some or all of their own energy needs. Under Customer Self-Supply, the member/customer agrees not to export any amount of energy in excess of the “Inadvertent Export” standard.

In exercising this option, the member/customer will not receive utility compensation for any amount of energy export, including small amounts of energy export that may momentarily or inadvertently occur as a result of customer load and generation imbalances.

The Smart Export option allows the member/customer the opportunity to operate as a “smart exporter” of energy. In other words, the member/customer exercising this option will only be compensated by KIUC for export at times whereby exported energy has value to the utility and, as such, will be compensated according to the value of the energy at the time of export.

The solar PV system must include, among other things, a battery for energy storage, and the member/customer would have several options for use of their self-generated energy: (a) export energy to the grid for and receive utility compensation during times of higher value to KIUC; (b) use energy to serve the member’s/customer’s own loads; (c) or store energy in the battery for later use.

If adopted by the PUC, the Smart Export option would provide no utility compensation for export during peak sunlight hours, when the grid is already saturated with solar, but instead would allow the member/customer to serve all or part of their own load or store the energy for later use.

Different levels of compensation will be offered at other times of the day, with maximum benefit to the member who exports during evening peak usage.

Currently, roughly 3,700 KIUC members/customers have solar PV systems on their homes or businesses, comprising about 20 megawatts of total power provided to the grid.

“This proposed revised Schedule Q rate schedule will allow us to accept more distributed energy resources onto the grid at the time of day when it is most needed,” Bissell said.

He added that, while this filing addresses members’/customers’ ability to install PV systems and potentially export energy to KIUC for some level of utility compensation, it does not address the overall rate design issues of determining a fair and reasonable means of charging for electrical service as a whole.

“KIUC will conduct member outreach and education focusing on fairness amongst member classes, particularly between those who choose to install distributed generation and those who do not,” he said.

According to Bissell, options under consideration for future rate design include, among other things, a potential fixed charge for grid connection (a.k.a. grid connection charge) that all members would pay, emphasizing that “a grid connection charge would not increase overall rates for most members, as usage-based charges would likely be reduced”

The PUC will now enter a deliberative process on KIUC’s comprehensive DER proposal.


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