Little Interest in Hawaii Feed-in Tariff Program Says Report

By Paul Gipe


Expected interest in Hawaii’s feed-in tariff program has not materialized says a report by the program’s independent observer.

Accion Group found that in the first month of operation Hawaii’s long-awaited feed-in tariff policy had generated little activity and much of the allocated capacity remains to be filled.

Hawaii’s experience contrasts markedly with successful programs in Ontario, Vermont, and Gainesville, Florida where applicants, many for solar photovoltaic (PV) systems, overwhelmed administrators.

Of the total 80 MW allocated to the program among the three utilities, only 2.6 MW of solar PV applications have been filed, says Accion, a New Hampshire consulting company. Accion makes no determination of why the response to the program has been so lackluster.

In addition, 23 kW of existing net-metered projects have converted to the feed-in tariff program. 20 MW of capacity has been allocated to conversion from net-metering accounts through early 2011.

The Hawaii Public Utilities Commission (PUC) approved Tier 1 and Tier 2 feed-in tariffs on October 13, 2010. Tier 3, the final tier in the program, has not been approved and there is no definite date when it will be implemented.

Critics have charged that the program is limited and offers unattractive prices.


Hawaii Program D Rated

In the World Future Council feed-in tariff grading system, Hawaii compares well to Vermont, though both share a “D” grade. Hawaii’s grade of 57 points is slightly higher than Vermont’s 54 points.

Hawaii’s program has two features that make it stand out in comparison to Vermont.

  • Hawaii is the first state in the nation with tariffs in dual tracks: one set of tariffs for those using one set of state subsidies, another set of tariffs for those that use a different state program.
  • Multiple tariffs for multiple technologies.

Vermont’s program offers two tariffs for wind energy: one for small wind, one for large. However, there are only single tariffs for all other technologies.

Hawaii, in contrast to Vermont, offers tariffs for four different technologies in two size “tiers” as they’re called. Tier 1 is for projects less than 20 kW. Tier 2 is for varying amounts greater than 20 kW depending upon the island where the projects are located.

However, Hawaii’s program is far less robust than successful programs in other countries and the Canadian province of Ontario. In the World Future Council’s grading system, Ontario qualifies for an A- with 84 points.


Program Details

In implementing the program Hawaii’s Public Utility Commission PUC ruled that despite concerns, the program should be launched without further delay. “The commission believes the better course is to proceed, learn from experience, and make any necessary changes and improvements upon the commission’s next opportunity to review the FIT program in two years,” the PUC said in its ruling on the program.

  • Program review: 2 years
  • Program Cap: 80 MW in Total
    • Oahu – 60 MW
    • Big Island – 10 MW
    • Maui, Lanai, Molokai (combined) – 10 MW
  • Project Size Tier 1: <20 kW on all islands
  • Project Size Tier 2: >20 kW as noted
    • PV: <500 kW on Oahu
    • PV: <250 KW on Maui and Hawaii (the Big Island)
    • PV: <100 kW on Lanai and Molokai
    • CSP: <500 kW Oahu, Maui, and Hawaii (the Big Island)
    • CSP: <100 kW on Lanai and Molokai
    • Wind: <100 kW on all islands
    • Hydro: <100 kW on all islands
  • Project Size Tier 3: <5 MW on Oahu
    • <2.72 MW on Maui and Hawaii
    • Or 1% of peak load
    • Wind: >100 kW excluded on Maui and Hawaii


Comparison of Hawaii Program

By international standards the program is modest. Hawaii has a population of 1.3 million. The 80 MW FIT program limit represents 0.06 kW per capita, although there are other programs in the state for procuring renewables.

In contrast, Vermont has a significantly smaller population and a similar program cap, resulting in a slightly higher relative limit of 0.08 kW per capita.

Neither Hawaii’s nor Vermont’s state program compares favorably to Gainesville, Florida. Gainesville has set a soft target of 32 MW for a population of 100,000 for a relative program cap of 32 kW per capita-four times that of Vermont and more than five times that of Hawaii.

Insolation in Florida and Hawaii is similar and significantly more than in Vermont. If all the program capacity was developed with solar PV, Hawaii and Vermont would generate about 1% of their electricity with solar. In contrast, Gainesville would generate 2% of its supply with its program.

Gainesville installed nearly 4 MW of solar PV in 2010, the first full year of the program or nearly twice the 2.6 MW of applications under Hawaii’s program.

Germany currently generates 2% of its more than 500 TWh per year from solar PV alone. Wind turbines in Germany produce another 7% of supply. Biomass and biogas generation bring total renewable generation to 16% of supply.