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Hawaii’s energy transition provides a model for decarbonization

by Pamela Largue: Rocky Mountain Institute (RMI) has released its new report… 

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Powering Paradise: How Hawaii Is Leaving Fossil Fuels and Forging a Path to a 100 Percent Clean Energy Economy. The report provides a comprehensive review of Hawaii’s clean energy journey, exploring the confluence of elements that have made this transition possible.

In 2015, Hawaii was the first US state to proclaim a 100 percent renewable energy target. Since then, 14 other states, over 110 cities, and at least 20 utilities have followed suit to set 100 percent clean or renewable energy goals. These and other jurisdictions can learn from Hawaii’s relentless pursuit of innovation as they work to make their own energy targets a reality.

“People refer to Hawaii as the ‘postcard from the future’ because the state is confronting grid transformation issues sooner and is leading on pioneering approaches to the energy transition, from how the electricity system is planned, to how energy resources are procured and managed, to re-envisioning the role and business model of the utility,” said Dan Cross-Call, principal at RMI and co-author of the report. “Hawaii’s journey provides lessons for many aspects of energy system innovation, which other jurisdictions can benefit from.”

Drawing on interviews with stakeholders, RMI’s first-hand experience in Hawaii, and extensive research, the report offers lessons transferable to other US energy sectors engaging in their own transition to a 21st-century clean energy system.

A willingness to try – Hawaii constantly pushes boundaries, without having a clear script. Others can learn from Hawaii’s missteps, but should be emboldened to take risks, assured that rapid feedback loops will accelerate rather than impede their progress.

Clear guidance from leadership – From the justification for the 100 percent renewable energy target, to framing the utility of the future and expectations for stakeholder engagement in regulatory proceedings, Hawaii demonstrates the importance of establishing reasoned, clear, and compelling intentions for the energy transition.

Stakeholder engagement – As it steps into the unknown across so many fronts, Hawaii has consistently crowdsourced invaluable wisdom from local stakeholders, as well as drawn upon national and international experience.

Ensuring broad support for its actions has been critical for maintaining momentum and making progress toward targets that benefit everyone.

How Hawaii Is Leaving Fossil Fuels and Forging a Path to a 100% Clean Energy Economy

In 2015, Hawaii was the first US state to proclaim a 100 percent renewable energy target. Since then, 14 other states, over 110 cities, and at least 20 utilities have followed suit to set 100 percent clean or renewable energy goals. These and other jurisdictions can learn from Hawaii’s relentless pursuit of innovation as they develop strategies to make their own energy targets a reality.

A timely report from Rocky Mountain Institute (RMI), Powering Paradise: How Hawai‘i Is Leaving Fossil Fuels and Forging a Path to a 100 Percent Clean Energy Economy, provides a comprehensive review of Hawaii’s clean energy journey, exploring the various elements which have come together to make this possible.

Hawaii’s leadership is in part due to simple economics. The state’s heavy reliance on imported fossil fuels makes electricity expensive and creates a financial incentive for renewable energy. It is also a reflection of the state’s culture of innovation and its determination to build a better future.

Exhibit: Hawaii’s rooftop solar installations have increased dramatically as solar costs have fallen

Drawing on interviews with Hawaii stakeholders, RMI’s first-hand experience in the state, and extensive research, the report offers lessons transferable to other U.S. states engaging in their own transition to a 21st century clean energy system:

1. A willingness to try – Hawaii constantly pushes boundaries without benefit of a clear script. Others can learn from Hawaii’s missteps, but should be emboldened to take risks, assured that rapid feedback loops will accelerate rather than impede their progress.

2. Clear guidance from leadership – From the justification for the 100 percent renewable energy target, to framing the utility of the future and expectations for stakeholder engagement in regulatory proceedings, Hawaii demonstrates the importance of establishing reasoned, clear and compelling intentions for the energy transition.

3. Stakeholder engagement – As it moved into the unknown on many fronts, Hawaii has consistently crowdsourced invaluable wisdom from local stakeholders, as well as drawn upon national and international experience. Ensuring broad support for its actions has been critical for maintaining momentum and making progress toward targets.

This report distills this complex story into those key insights most transferable to others in the midst of transformation of energy systems in markets throughout the United States.

Learning from Aloha: Hawaii’s Energy Transformation

How Hawaii Is Leaving Fossil Fuels and Forging a Path to a 100% Clean Energy Economy

n March 2011, a massive 9.0 earthquake off the coast of Japan precipitated a cascading series of events that ultimately sparked Hawaii’s rooftop solar boom more than 4,000 miles away.

As Japan shuttered its nuclear fleet and ramped up production from its oil-fired generators, global demand for oil increased, and so did prices. Since petroleum fueled 80 percent of Hawaii’s electricity generation in 2011, when oil prices rose, so did the state’s retail electricity rates—up to more than three times the US national average.

Hawaii residents felt the pain through their utility bills. To alleviate the financial burden of electricity, customers increasingly installed cost-competitive solar systems, often financed through third parties for $0 upfront, with excess generation compensated at retail rates through utility net metering programs. Solar adoption exploded at an unprecedented speed and magnitude, rapidly vaulting Hawaii into the echelon of leading states for installed solar capacity per capita.

But apart from market forces propelling adoption of customer-sited renewable energy (as well as utility-scale), Hawaii is an important case study for the energy transition because deliberate leadership from legislative, regulatory, utility and grassroots levels is effectively steering the state forward on decarbonization.

In a new report from RMI, Powering Paradise, we tell the story of Hawaii’s unfolding energy transition—from individuals’ leadership and legislative accomplishments, to the details of utility and regulatory efforts to achieve a low-carbon energy system. With this report, we seek to consolidate and make sense of the countless headlines and events that have churned out of Hawaii in recent years, to translate those to a wider audience and help practitioners of the energy transition everywhere reflect on what lessons we can all take from the island state. In addition, this report is a celebration of the progress and accomplishments that Hawaii is making.

From Broad Vision and Targets to Detailed System Design

Hawaii is the paragon for energy sector transformation precisely because its leaders are addressing the challenges of creating a 21st century electric system with a holistic and iterative approach. Over the last decade, Hawaii has passed a steady stream of legislative milestones. These include the monumental Act 97 in 2015, which made Hawaii the first state to proclaim a 100 percent renewable energy target. Today, over a hundred other state and local jurisdictions have either set renewable energy goals, or, in a few cases, mandates like Hawaii’s. They and others can draw from Hawaii’s experience to develop strategies to achieve their goals.

It is difficult to distill all the lessons of Hawaii’s embrace of clean energy over the last decade, but key themes can at least help characterize the state’s evolution across three main fronts:

  1. Procurement: For customer-sited technologies, Hawaii is refining solar and storage compensation structures, utility programs, and policies to ensure that the full spectrum of capabilities are harnessed to support grid operations. For utility-scale projects, Hawaii is focusing on competitive sourcing mechanisms and consultative processes to ensure the benefits of renewable energy are captured, equitably shared, and well understood.
  2. Planning: Hawaii is taking a systems approach to developing modern planning practices that account for generation, distribution and transmission in an integrated manner and reconsiders the roles of customers, service providers and the utility.
  3. Regulations: Hawaii is updating its utility regulations in a manner that encourages a viable utility business that fulfills customer and societal needs as well as the ambitions of the state’s energy policies.

RMI’s Powering Paradise report provides a comprehensive review of the Aloha State’s journey through these and other elements of the energy transition. It explores the technical details of customer solar innovation in a post-net metering world, the nuances of harmonizing traditionally discrete and opaque planning processes, and the details of implementing a performance-based regulatory framework to align the utility business with a 100 percent renewable energy future.

Collaboration, Innovation and Experimentation

In addition to the importance of leadership in establishing and justifying a North Star to orient the state’s efforts, Hawaii also demonstrates two further lessons with broad applicability for others pursuing energy reform.

First, Hawaii’s experience embodies a willingness to try. There is no blueprint for managing the evolution of the electricity ecosystem, but Hawaii is consistently pushing boundaries, without always having a clear script for where it will go. Others can learn from Hawaii’s missteps, but should also be emboldened to take their own risks, assured that rapid feedback loops will accelerate rather than impede progress toward solutions.

Second, as it has stepped into the unknown across so many fronts, Hawaii consistently engages stakeholders to crowdsource invaluable local wisdom, draw from national and international experience, and ensure support for actions that are collaboratively developed to achieve benefits for everyone.

Although goals for 100 percent renewable or clean energy may feel ambitious, they are becoming common. They are also an accelerant to move the power system onto a sustainable path consistent with global climate goals. To be successful, plans must be developed that take note of lessons learned elsewhere. As one US state leading on energy transformation, Hawaii’s story is relevant for energy stakeholders everywhere. We hope our Powering Paradise report helps inspire and inform your own thinking and important efforts.

Source: Renewable Energy World

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