The utility has been developing a comprehensive Request For Proposals that would call for significant solar and other renewable energy generation technologies that would generate at least 5 megawatts of electricity.
“That RFP has been taking a really long time to get through the Public Utilities Commission,” said Hawaii Electric Spokesman Peter Rosegg.
The RFP is complicated because it allows for companies to build solar installations on nearby islands and connect them to Oahu with an underwater cable – something that’s never been done before.
That complication has held up PUC approval for Hawaii Electric’s RFP for a year and a half. That’s time the utility doesn’t have.
“We are highly dependent on oil for electricity here,” Rosegg said. “Oil prices on the island don’t reflect what’s happening in the United States, but what the Japanese market is and they’re willing to pay very high prices.”
Since Japan has decommissioned many of its nuclear plants after the Tsunami there two years ago, oil demand in the Asian Pacific has skyrocketed, and prices have followed the demand, Rosegg said.
High oil prices combined with the most aggressive renewable energy portfolio standard in the country, which will require all Hawaii utility companies to source 40 percent of their energy from renewable sources by 2030, have given Hawaii Electric a sense of urgency.
In order to get things moving, the utility negotiated with the PUC to allow well-priced projects of 5 megawatts or more that can be developed on the island of Oahu and in service by the end of 2015 to go forward without an RFP.
“We have reason to believe there are projects waiting to bid on this RFP that are substantially ready to go,” Rosegg said. “And we just want to break the logjam for anyone with a project like that.”
In order to be considered for an RFP waiver, the projects will have to be affordable and the companies proposing them will have to be willing to open their books to explain their pricing, Rosegg said.
Projects will generally have to have a levelized cost of 17 cents per kilowatt hour or less and be capable of finishing in time to put renewable energy on the Oahu grid by the end of 2015. Applications are due by March 22. Rosegg said he expects most companies to take the full time to prepare their proposals.
“This is open to any renewable energy technology,” Rosegg said. “But the quick deployment and requirements will probably make solar the best-suited.”