Hawai’i PUC Releases Renewable Procurement Policy Evaluation

In January, the Hawai’i Public Utilities Commission (PUC) posted a report titled Evaluation of Hawaii’s Renewable Energy Policy and Procurement.  This report was funded under a National Association of Regulatory Commissioners (NARUC) grant, for which the PUC retained Energy and Environmental Economics, Inc. (E3) to develop a methodology and compare the economics of different renewable procurement options.

Hawaii sign board

This report aims to provide a foundational analysis on the estimated economic costs and benefits of Hawaii’s various renewable energy procurement programs, which include the state’s net metering program, feed-in tariff, and competitive bidding framework for large-scale energy generation. This initial report is considered the first phase of a larger effort.

The report notes that, “The analysis demonstrates that the current NEM policy, which provides a full retail rate credit, results in a higher cost renewable option than FIT or utility-scale procurement mechanisms…There are still reasons to promote customer-sited behind the meter systems and some of these qualitative policy elements may partially provide a counterweight to the higher costs of the policy.”  Hawai’i also has some of the highest retail electricity prices in the nation.

The PUC will continue to work with E3 to further refine the approach and evaluate potential changes to the existing planning and procurement of renewable energy with the goal of reducing costs of renewables to ratepayers in Hawaii and / or increasing their value.

Image: © tang90246 – Fotolia.com

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