Moving On To A Broader Approach: Rooftop Solar Versus Distributed Energy Resources

If it was not evident when the distributed energy resource investigation docket (Docket No. 2014-0192) was first opened more than a year ago, the first section of the Hawaii Public Utilities Commission (PUC) Decision & Order No. 33258 issued on October 12 reiterated that things will have to change with statements such as the following:

It is abundantly clear that distributed energy resources can provide benefits to Hawaii. It is also clear, for both technical and economic reasons, that the policies established more than a decade ago must be adapted to address the reality of distributed energy resources as they exist today - and as they are likely to develop in the near future. The challenge facing the State now is ensuring that DER continues to scale in such a way that it benefits all customers as each utility advances towards 100% renewable energy. (page 4)

In Order No. 32503, the commission further observed: The commission submits the distributed solar PV industry in Hawaii will, out of necessity due to their accomplishments thus far, have to migrate to a new business model, not unlike what is expected for the HECO Companies as a result of disruptive technologies. The distributed solar business model will need to shift from a customer-value proposition predicated upon customers avoiding the grid financially - but relying upon it physically and thereby creating circuit and system technical challenges - to a new model where the customer-value proposition is predicated upon how distributed solar PV benefits both individual customers and the overall electric system, and hopefully becomes a key contributor to Hawaii's grid modernization. (page 10)

Now several weeks after the order was issued, it does not come as a surprise that within the solar industry there are two camps forming, one camp denouncing the order and setting up a strategy and tactics for a political fix to reinstate net-energy metering and a second camp collaborating on new opportunities to meet the evolving needs of electricity customers and provide services to the electric grid through a variety of technologies.

A November 10 press release announced the formation of the Distributed Energy Resources Council (DERC-Hawaii) which formed as a "collaboration between distributed energy resource (DER) and smart grid (SG) companies committed to developing constructive paths toward an affordable, reliable and sustainable energy supply for Hawaii."

This announcement followed the resignation of Leslie Cole-Brooks as the Executive Director of the Hawaii Solar Energy Association and departure of its former President, Chris Debone, the managing partner of Hawaii Energy Connection as a member.

In an interview with Chris Debone, Utility Dive's Herman Trabish reports the following in a November 12 article:

“It is not just about solar anymore,” said CEO Chris DeBone of [DERC-Hawaii] founding member Hawaii Energy Connection. “The like-minded group of participants in this new coalition did not see proper representation in what was called the DER docket.” 

The founding group feels those who make and deploy things like smart grid technologies, intelligent energy management, smart meters, and energy storage need to have a voice, he added. 

The group was formed over the last few months but started to more formally come together after the release of the PUC’s Order ending Phase 1 of its DER proceeding. There is a lot of interest in membership because "this is the epicenter of a fundamental change," DeBone said. “There has to be an advanced grid if the state is going to get to 100% renewables.”

In the other camp, The Alliance for Solar Choice responded to the PUC order by filing a lawsuit, which I reported on in my post, "TASC Follows Thru & Whines Away With Lawsuit."  On November 18 TASC issued a press release which appears to be the result of a push poll to support its position which avers the unpopularity of the PUC's decision and order ending the net-energy metering program.  Given the complexity of the decision and order and the general lack of understanding regarding the stability of the electric grid, it would be hard categorize this as anything but a push poll, a tactic previously used by TASC.

Adding more intrigue, Herman Trabish reports a breakup between SolarCity and Sunrun in a November 25 Utility Dive article entitled "SolarCity leaves TASC, denies split with advocacy partner Sunrun" and noting in the article that "TASC's tactics have been controversial, particularly in Hawaii, Nevada and Maine . . ."  Solar City apparently is now part of a newly formed advocacy group called Energy Freedom Coalition of America.  While the Utility Dive article does not explicitly contribute the split to a disagreement on tactics, it does link to a November 20 Las Vegas Sun article by Kyle Roerink which does state such:

Sunrun, the nation’s second largest rooftop solar company and a fellow member of the alliance, has been SolarCity’s top ally in the net metering fight. But SolarCity’s split from the alliance highlights an apparent rift with its competitor. 

The two have differed on tactics for addressing the state’s solar policies and disagreed on how to work with lawmakers and regulators. 

“It makes sense to engage the discussion in our own name,” Will Craven, SolarCity spokesman, said. “Nevadans expect to hear directly from us, and we want them to know that SolarCity is aligned with them on these issues.” 

Sunrun declined to comment.

If you are confused by the reorganization these special interest groups just remember this, rooftop solar has only benefited between 10-15% of electricity customers but has created a situation where critical upgrades must be made to ensure stability and reliability of the electric grid.  Without correct pricing signals and adjustment to fix charges, the bulk of these upgrades will be paid by electricity customers who cannot afford or do not have access to rooftop solar.  The Hawaii Public Utilities Commission order was well-reasoned and justified to protect these customers and the general public interest advocating for fairness and equity of the electric system to ensure clean energy policies benefit all electricity customers.