Updated 4:40 p.m., 10/21/2015

A group representing rooftop solar interests sued the Hawaii Public Utilities Commission on Wednesday over its decision last week to cap a popular program that let residents with photovoltaic systems sell excess energy back to the electric companies at the full retail rate.

The PUC order capped the net energy metering program, grandfathering in customers who either already have solar PV systems or had applied to install one prior to Oct. 13.

The commission created new options in place of the NEM program. Under the grid-supply option, which is most similar to NEM, customers can export excess energy to the grid as needed but the energy credits on their monthly bills will be at almost half the rate that NEM provided.

The Alliance for Solar Choice has sued the Hawaii Public Utilities Commission over its decision to cap the net energy metering program.
The Alliance for Solar Choice has sued the Hawaii Public Utilities Commission over its decision to cap the net energy metering program. ProVision Solar

The Alliance for Solar Choice is seeking a preliminary injunction in state court, alleging that the PUC exceeded its statutory authority, violated state and federal law, and violated constitutional due process requirements, according to a TASC release.

TASC is co-chaired by John Stanton of Sunrun and Bryan Miller of Solar City.

“The PUC’s decision is neither fair nor justified,” Miller said. “Contrary to a law passed by the Hawaii Legislature two years ago, the PUC failed to conduct a cost-benefit analysis to determine the value of solar on the grid. Instead, the PUC relied upon speculation by the utility and ended net metering without notice to consumers.”

The PUC order affects Hawaiian Electric Industries’ customers on Oahu, Maui and Big Island. The decision, by and large, does not impact the members of the electric utility company on Kauai, which as a cooperative is out from under the HEI monopoly.

“The PUC’s decision is fatally flawed,” Miller said. “The PUC acted illegally and failed to hold a public hearing or give parties the opportunity to challenge the assertions the PUC relied upon. As a result, the decision is unworkable.”

He said by guaranteeing customers only two years worth of rates, they don’t know if a 20-year investment makes sense.

Instead of the full retail rate of roughly 27 cents per kilowatt-hour, the PUC order says HECO customers will be credited 15.07 cents per kwh; Hawaii Electric and Light customers will get a rate of 15.14 cents per kwh; and Maui Electric Co. customers will get 17.16 cents per kwh on Maui, 24.07 cents per kwh on Molokai, and 27.88 cents per kwh on Lanai.

“The PUC should have given parties the opportunity to meaningfully test HECO’s assertions and conduct a study to understand the value of solar on the grid,” Miller said.

Update Buried in the middle of its 322-page order, the PUC took TASC to task for intervening in the docket and then trying to delay the proceeding to serve its own members’ interests.

TASC sought a hearing last summer after seeing that the pending order wasn’t looking favorable to the solar industry.

The PUC said when TASC first asked to intervene in the distributed energy resources docket in September 2014, permission was granted in March based on the group’s agreement to not try to broaden the scope or delay the proceeding. The group also agreed that the docket would not be one in which a formal hearing would be held, the PUC said.

The Consumer Advocate, Hawaiian Electric and other parties objected to TASC’s motion to initiate hearings.

The Consumer Advocate’s office, headed by Jeff Ono, said TASC was clearly trying to delay the proceeding by asking for a hearing at that point.

“TASC fails to state how its [94-page] joint Final Statement of Position represents an insufficient opportunity to respond on the record to the positions and evidence offered by the parties,” the Consumer Advocate said in its filings.

The solar group argued at the time that the procedures to date in the proceeding “are insufficient to establish the requisite level of sophistication in the record to ensure TASC’s rights are protected.”

The Consumer Advocate and others weren’t buying it though.

“TASC’s purpose in this proceeding is to preserve the existing NEM retail rate compensation structure for as long as possible by requesting additional regulatory processes,” the Consumer Advocate said at the time.

The state Department of Business, Economic Development and Tourism also opposed TASC’s request for a hearing, saying it would delay the implementation of longer-term distributed energy resources market solutions.

The PUC said in its Oct. 12 order, which formally denied the hearing request, that the public’s interest in a timely disposition of the significant energy policy issues in the docket would be prejudiced if it allowed TASC to “impermissibly assert inconsistent positions and to play ‘fast and loose’ with the commission or ‘blowing hot and cold’ during the course of the proceedings.”

Read a copy of the complaint below.

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