PUC technical conference examines Hawaiian Electric’s retail-wheeling straw proposal, stakeholders press on fees, curtailment and protections

Hawaiian Electric presented a straw proposal to the Hawaii Public Utilities Commission on retail wheeling that would allow third-party renewable generation to provide bill credits to customers elsewhere on the same island, while the utility retains operational control of the grid.

Becca Dehof Matsushima, vice president of customer service for Hawaiian Electric, said the company framed the proposal around five guiding principles: clarity and accessibility, minimizing cost shifts to non-participating customers, maintaining system reliability through controllability and interconnection standards, fair pricing and safety. "If it's not easily understandable... then we've already failed," she told the conference.

The company proposed island-differentiated generator size limits — 100 kilowatts to 2 megawatts on Oahu and a 1-megawatt cap on Maui and Hawaii Island — with initial participation limited to residential and small commercial schedules (R and G). Generators would be distribution-connected, renewable and controllable; Hawaiian Electric said generators may not also participate in other company programs or be paid twice for the same output.

Hawaiian Electric outlined a tiered interconnection approach that uses Rule 14H as a baseline and adds supplemental requirements for wheeling projects. Smaller projects would follow a streamlined Rule 14H path; medium and large projects could require additional screens (transient overvoltage, ground-fault) and higher-fidelity studies. SCADA telemetry and power-quality monitoring would be required at larger scales, though the company said lower-cost cellular solutions could be acceptable for smaller facilities if they meet operational needs.

On settlements and metering, Hawaiian Electric said it would require utility-owned revenue-grade meters installed near the point of interconnection, and a one- to two-month verification lag before bill credits are applied. The company proposed that the wheeling generator — not the participant — pay a kilowatt-based wheeling fee intended to recover grid and administrative services; the fee would be reconciled to actual costs to avoid overcollection.

Stakeholders pressed staff on key design choices. Consumer advocate and other parties raised concerns that retail wheeling, which allows non‑time‑coincident generation to offset customer load, could displace lower-cost dispatchable resources during curtailment and shift costs to nonparticipants. Hawaiian Electric explained its curtailment priority would mirror CBRE Phase 2 practices — reducing must‑run dispatchable resources to minimums first and curtailing wheeling resources after — and acknowledged that under its proposal "there would be no compensation or bill credit for curtailed energy." That treatment, the company said, is intended to discourage overbuilding and to limit cost shifts.

On price signals, the utility cautioned that designing a time‑differentiated bill credit is complex because wheeling generators are not co-located with the loads they offset and participants do not control generation timing. The company did, however, signal openness to exploring time-of-use approaches and to adjusting participation bands after an initial pilot phase.

During Q&A, Hawaiian Electric's pricing director gave a preliminary Oahu reference for the capacity-based fee "about in the $12 per kW range," but emphasized that final fees depend on program scope, caps and modeling assumptions. Stakeholders including distributed-energy-resource developers urged simpler, low‑cost interconnection and credit approaches and asked whether aggregation (an aggregator combining multiple sites) or adjacent-property direct transfers could be accommodated; Hawaiian Electric said aggregation raises verification and administrative complexity and that adjacent-property carve-outs were not part of the current straw proposal but could be examined.

The PUC noted the need for additional modeling, a procedural schedule and a guidance letter to solicit further stakeholder comments; staff said it will produce more detailed guidance and a schedule leading toward a tariff decision. Commissioners repeatedly urged a phased, simple approach to get a workable initial program in place and to refine the design after lessons learned.

What happens next: the PUC will circulate guidance and a procedural schedule; parties and stakeholders may file comments in docket 2024-0200. The company and commission staff said they will refine interconnection, metering and credit details, modeling the wheeling fee and curtailment impacts before a final tariff is proposed.