Distributed Energy Resource (DER) Policies (Docket No. 2019-0323)
Background | Upcoming Events | Past Events |Topic Tracks | Key Orders | More Information
BACKGROUND
Distributed Energy Resources (“DERs”) are small-scale resources that enable customer participation in the generation and delivery of electricity service. The most common DERs used for electricity generation are solar photovoltaic panels, which are often paired with battery energy storage systems.
In September 2019, the Hawaii Public Utilities Commission opened Docket No. 2019-0323 to investigate the technical, economic, and policy issues associated with DERs and rate design, as they pertain to the Hawaiian Electric Companies. Docket No. 2019-0323 is divided into three tracks, covering topics in 1) Advanced Rate Design (“ARD”), 2) DER Programs, and 3) Technical issues.
UPCOMING EVENTS
| Date and Link to watch live (if available) | Topic Track | Description | Notice and Agenda |
|---|---|---|---|
| Second Thursday of each month, January – December 2023 | Advanced Rate Design | Advanced Rate Design Working Group Meetings | Notice of Schedule |
| June 23, 2023 | Program | Meeting to Discuss Final DPS Phase 3 Modeling Results | Notice of Meeting |
PAST EVENTS
| Date | Topic Track | Description | Notice, Agenda, and Materials |
|---|---|---|---|
| April 14, 2023 | Program | Meeting to Discuss Draft DPS Phase 3 Modeling Results | Notice of Meeting
Draft DPS Phase 3 Modeling Results Hawaiian Electric’s Presentation |
| April 13, 2023 | Program | Seventh Scheduled Dispatch Program Quarterly Check-In | Agenda |
| March 20, 2023 | Technical | Sixth Quarterly DER Technical Track Meeting | |
| February 15, 2023 | Advanced Rate Design | Additional ARD Working Group Meeting to continue discussions on HECO’s ARD Compliance Filing | Notice of Meeting |
| January 12, 2023 | Program | Sixth Scheduled Dispatch Program Quarterly Check-In | Agenda |
| December 19, 2022 | Technical | Fifth Quarterly DER Technical Track Meeting | |
| December 15, 2022 | Program | DPS Phase 3 Technical Conference | Notice |
| December 12, 2022 | Advanced Rate Design | Advanced Rate Design Working Group Meetings | Notice of Working Group Schedule |
| October 14, 2022 | All | Hawaiian Electric Presentation on the Demand-Side Management Adjustment (Docket No. 2007-0341) and Demand Response Adjustment Clause Adjustment (Docket No. 2019-0323) | Notice |
| October 13, 2022 | Program | Fifth Scheduled Dispatch Program Quarterly Check-In Meeting | Agenda |
| September 26, 2022 | Technical | Fourth Quarterly DER Technical Track Meeting | |
| July 14, 2022 | Program | Fourth Scheduled Dispatch Program Quarterly Check-In Meeting | Agenda |
| June 21, 2022 | Technical | Third Quarterly DER Technical Track Meeting | |
| April 14, 2022 | Program | Third Scheduled Dispatch Program Quarterly Check-In Meeting | Agenda |
| March 29, 2022 | Technical | Second Quarterly DER Technical Track Meeting | |
| March 15, 2022 | Program | Program Track Phase 2 Technical Conference | |
| January 13, 2022 | Program | Second Scheduled Dispatch Program Quarterly Check-In Meeting | Agenda |
| December 14, 2021 | Technical | First Quarterly DER Technical Track Meeting | Hawaiian Electric Update |
| October 14, 2021 | Program | First Scheduled Dispatch Program Quarterly Check-In Meeting | Notice |
| June 28, 2021 | Program | Status Conference on Hawaiian Electric’s Scheduled Dispatch Program Implementation Plan | Notice |
| May 12, 2021 | Program | Supplemental Phase 1 Program Track Meeting #3 to discuss final Program Track proposals, including Scheduled Dispatch Program proposals | Notice and Agenda |
| April 21, 2021 | Program | Supplemental Phase 1 Program Track Meeting #2 | Agenda |
| April 7, 2021 | Program | Supplemental Phase 1 Program Track Meeting #1 | Notice |
| March 24, 2021 | Program | Technical Conference to discuss Scheduled Dispatch Program guidance | Notice and Agenda |
| March 17, 2021 | Program | Fifth Monthly DER Program Track Status Conference | Agenda |
| March 4, 2021 | Advanced Rate Design | ARD Track Technical Conference | Notice and Agenda
DER Parties’ Consultant Slide Set 1 |
| February 17, 2021 | Program | Fourth Monthly DER Program Track Status Conference | Notice |
| January 20, 2021 | Program | Third Monthly DER Program Track Status Conference | Notice |
| December 16, 2020 | Program | Second Monthly DER Program Track Status Conference | Agenda |
| November 18, 2020 | Program | First Monthly DER Program Track Status Conference | Notice |
| October 21, 2020 | Program | Status Conference for the DER Program Track | Notice and Agenda |
| August – October, 2020 | Advanced Rate Design | Seven Advanced Rate Design Working Group Meetings (August 5, 2020; August 19, 2020; September 2, 2020; September 16, 2020; September 30, 2020; October 14, 2020; October 28, 2020) | Notice, Schedule, and Agenda |
| August 4, 2020 | Technical | Technical Track Technical Conference | Notice and Agenda |
| July 23, 2020 | Program | Technical Conference to discuss the DER Program Track initial Proposal and information requests | Notice |
| June 4, 2020 | Advanced Rate Design | Technical Conference to address desired directions for advanced rate design | Notice and Agenda |
| May 7, 2020 | Technical | Status Conference to review Hawaiian Electric’s draft proposal to expedite customer interconnection | Notice and Agenda |
| April 28, 2020 | Program, Technical | Status Conference to discuss the concerns and proposals raised by the Solar Parties in their joint letter filed with the Commission on April 3, 2020 | Notice and Agenda |
| January 30, 2020 | Program, Technical | Technical Workshop to solicit feedback from the Parties on programmatic and technical issues identified in Order No. 36536 | Notice and Agenda |
TOPIC TRACKS
Docket No. 2019-0323 is divided into three tracks, covering topics in:
Advanced Rate Design (“ARD”),
DER Programs, and
In the ARD track, the Commission and the Parties have explored dynamic and advanced rate designs intended to incentivize customer behavior to align with grid needs and realize the full value of DER investments.
The Commission and the Parties have been working collaboratively since 2020 in an ARD Working Group process to establish an ARD framework for residential customers and small and medium sized commercial customers, with the objective of ensuring rates are designed to encourage energy efficiency and demand flexibility, improve grid resilience, promote reliability, reduce environmental impacts, and achieve other State energy policy goals.
Following seven stakeholder working group meetings between August and October 2020 and the Parties’ Proposals in March 2021, the Commission issued Order No. 38680 establishing the ARD framework to implement time-of-use (“TOU”) rates.
The ARD framework introduces three phases for the implementation of TOU rates: the Ramp Up Period, the Roll Out Period, and the Evolve Period. The Commission re-established the ARD Working Group to kick off the Ramp Up Period, as the Companies prepare for rolling out the new TOU rates.
The Commission identified two broad objectives for the Program Track in Order No. 37066: 1) design and implement long-term DER programs that include both an export-only program and a more advanced program featuring compensation for energy exports and grid services, and 2) develop a transition plan for interim DER programs to promote market stability and minimize customer confusion.
In Phase 1 of the Program Track, through a series of technical conferences and monthly meetings, the Parties prepared several rounds of program proposals for the two long-term DER programs. The Commission determined in the Phase 1 Order, No. 38196, that the Smart DER Tariff and Bring-Your-Own-Device (“BYOD”) Tariff would be the two long-term DER programs. In Phase 2, the Parties prepared additional proposals for these two tariffs, and the Commission established the framework for the tariffs in the Phase 2 Order, No. 38681. In Phase 3, the Companies are collaborating with the Parties to prepare modeling results for the incentives for the Smart DER Tariff and BYOD Tariff. Following review by the Parties and Commission decision-making in Phase 3, the Smart DER Tariff and BYOD Tariff will launch for customer enrollment.
Separate from these three phases, in Order No. 37816 the Commission approved an emergency grid services program, the Scheduled Dispatch Program (“SDP”; also known as the Emergency Demand Response Program and the Battery Bonus Program), for Oahu to address potential capacity shortfalls beginning in 2022. The Commission also approved amendments to SDP in Order No. 38239 and an expansion of SDP to Maui in Order No. 38393 to address similar capacity shortfalls.
The Parties continue to collaborate in Phase 3 of the Program Track and to hold quarterly SDP meetings to provide updates to the Commission.
The Commission identified four objectives for the Technical Track in Order No. 37066: 1) streamline and improve the interconnection process, 2) harmonize the Companies’ Rule 14H requirements with current Institute of Electrical and Electronics Engineers (“IEEE”) standards, 3) develop policies and procedures for the activation of additional advanced inverter functions, and 4) develop policies and procedures to update legacy equipment (such as inverters) for participation in new DER programs.
The Commission approved two of the Parties’ stipulations to revise Tariff Rule 14H in Order No. 38062 and has addressed several of the Parties’ additional proposed revisions to Rule 14H in Order No. 38070, Order No. 38294, and Order No. 38651. Per Commission guidance, the Parties continue to collaborate to address outstanding issues identified in Order No. 38062, including a modified proposal for the Advanced Inverter Workplan.
KEY ORDERS AND FILINGS
April 9, 2020: Order No. 37066 – Establishing Procedural Details and Modifying Hawaiian Electric’s Customer Grid Supply Plus Program for Hawaii Island (Established Track Scopes)
September 24, 2019: Order No. 36538 – Opening the Docket
Advanced Rate Design Track
April 19, 2023: Order No. 39172 – Approving the Hawaiian Electric Companies’ Request for Time of Use Bill Protection for Commercial Customers
Summary: In addition to bill protection being provided for residential customers for the first six months of the TOU study, the Commission approved Hawaiian Electric’s request to provide similar bill protection for commercial customers for the first six months of the TOU study.
March 1, 2023: Order No. 39012 – Addressing Requests and Providing Guidance on the Hawaiian Electric Companies’ Implementation of the Advanced Rate Design Framework
Summary: The Commission provided guidance on Hawaiian Electric’s efforts to implement the TOU study, including customer bill presentation, marketing and education efforts, and options for customer opt-out.
February 7, 2023: Order No. 38847 – Establishing the Procedural Schedule for Implementation of the Advanced Rate Design Time of Use Study
Summary: The Commission added several procedural events in February through July to assist Hawaiian Electric’s implementation of the ARD TOU Study and to enable additional party review.
October 31, 2022: Order No. 38680 (Establishing the Advanced Rate Design Framework)
Summary: The ARD framework introduces TOU rates, with three time periods that have distinct prices that reflect how much it costs to produce energy during that period. Daytime energy prices will be the cheapest, reflecting the low cost of renewable energy produced during the daylight. Overnight prices will be slightly more expensive, and Evening Peak prices during weekdays will be the highest. Weekends and holidays will replace the Evening Peak Period with the Overnight Period.
The Companies will implement TOU rates over three phases:
Ramp Up Period: The Companies will calculate the TOU rates, prepare effective marketing, education and outreach materials, develop an evaluation and assessment plan, and prepare for the TOU Study;
Roll Out Period: The Companies will conduct a TOU Study, beginning in July 2023, with a sample of customers enrolled in the new TOU rates to understand the impacts and effectiveness of the rates; and
Evolve Period: The Companies will refine the TOU rates and accelerate customer enrollment in the TOU rates.
The ARD framework also provides guidance on the application of rate adjustments and surcharges for TOU rates, the design of customer bills, and the design of a non-time varying rate option for customers that opt out of TOU rates. During the Ramp Up Period, the Commission plans to re-establish the ARD Working Group to collaborate on the implementation of TOU rates. The TOU rates are expected to roll out to customers beginning in July 2023 with a TOU Study to explore the effectiveness of the rate design, followed by full roll-out to all customers.
Program Track
February 27, 2022: Order No. 38962 – Approving Hawaiian Electric’s and the DER Parties’ Request for Amendments and Revisions to the [Scheduled Dispatch Program] Tariff Sheets
Summary: The Commission approved revisions to the Scheduled Dispatch Program to encourage customer enrollment in the final year of program availability.
December 22, 2022: Order No. 38787 – Amending the DER Program Structure Phase 3 Third Extension of the Procedural Schedule
Summary: The Commission amended the DPS Phase 3 procedural schedule following discussion with the parties at the DPS Phase 3 Technical Conference, incorporating additional time and events to support the Parties’ collaborative modeling efforts and program implementation.
October 31, 2022: Order No. 38681 (Phase 2 Program Track Order)
Summary: The Phase 2 Program Track Order established the framework for the Smart DER Tariff, including the export compensation methodology and requirements for advanced metering and TOU enrollment, and the BYOD Tariff, including available grid services, eligible customers, the incentive rate methodology, and requirements for advanced metering and TOU enrollment. The Commission also determined transition plans for existing DER and SDP customers, rejected the establishment of an interconnection application fee, and opened Phase 3 of the Program Track. In Phase 3, the Companies will conduct modeling to determine the final export rate for the Smart DER Tariff and incentive rate for the BYOD Tariff. Following this modeling process and review by the Parties, the Smart DER Tariff and BYOD Tariff are expected to launch for customer enrollment in August 2023.
May 20, 2022: Order No. 38393 – Approving Hawaiian Electric’s Request for SDP Expansion
Summary: The Commission approved an expansion of SDP to Maui to address similar anticipated capacity shortfalls. The terms of the program on Maui are nearly identical to those of the program on Oahu, except that the capacity is 15 megawatts, with enrollment to customers open through June 2024.
February 25, 2022: Order No. 38239 – Amending the Scheduled Dispatch Program
Summary: The Commission approved amendments to the Scheduled Dispatch Program to increase customer compensation (via additional monthly incentives) and update customer performance requirements.
January 25, 2022: Order No. 38196 (Phase 1 Program Track Order)
Summary: The Phase 1 Program Track Order found that the Smart DER Tariff, which determines how a new DER customer may connect to the grid and how their energy exports are compensated on a time-varying basis, will be the long-term basic DER program. The BYOD Tariff, which compensates customers for grid services they supply to the Companies in addition to the terms of the customer’s underlying DER tariff, will be the long-term advanced DER program.
June 8, 2021: Order No. 37816 (Establishing the Scheduled Dispatch Program for Oahu)
Summary: The Scheduled Dispatch Program provides upfront and monthly incentives to customers for installing new battery storage paired with solar that dispatches daily during the grid’s peak hours for a commitment period of 10 years. The Commission established SDP with a capacity of 50 megawatts for Oahu, with enrollment to customers open through June 2023 to address anticipated capacity shortfalls.
Technical Track
April 4, 2023: Order No. 39115 – Approving the Parties’ Proposed Stipulated Procedural Schedule for Incentive-Based Inverter Upgrade Plan Proposal
February 1, 2023: Order No. 38840 – Addressing Matters Relating to the Distributed Energy Resources Technical Track
October 17, 2022: Hawaiian Electric Final Revised Rule 14H, Appendix I Tariff Sheets Amending the IEEE 1547 Harmonization Date
November 4, 2021: Order No. 38062 (Denying the Companies’ Advanced Inverter Workplan and Supplement, approving the Parties’ Stipulation of Revisions and Volt-Watt Stipulation, and providing additional guidance)
MORE INFORMATION
To see more and view all filed documents in the docket, see Docket No. 2019-0323
Updated 5/2023