HONOLULU - The state Public Utilities Commission on Tuesday ordered Hawaiian Electric Co. to reduce energy costs and accommodate more solar power and other renewable energy on the grid.
Hawaiian Electric must submit its plans for carrying out the orders within four months, said Michael Champley, one of three commissioners who announced the orders with Gov. Neil Abercrombie.
The utility must address the inability that some consumers have in connecting rooftop solar panels to the grid because so many of their neighbors have done so already, Champley said. The utility must accommodate more photovoltaic panels, he added.
The commission wants Hawaiian Electric to retire inefficient fossil fuel plants to cut costs and seek alternatives to fossil fuels. It ordered the utility to develop plans to connect various island grids and accommodate small, localized grids, or "microgrids" that may be developed.
"These are not recommendations," Abercrombie said. "These are decisions and orders for action plans that have to be put forward to the PUC's satisfaction within the next 120 days."
Commissioner Lorraine Akiba said the changes were needed to align the utility's strategy with customer expectations and the state's energy policy.
Hermina Morita, the commission's chairwoman, said high energy costs in Hawaii, along with the spread of renewable energy, changing customer expectations and evolving technologies, put the state at the forefront of transforming energy and defining the utility of the future.
A state law passed in 2009 requires Hawaii's electric utility companies to get 40 percent of their power from renewable sources by 2030. Abercrombie campaigned on a platform promoting energy independence for Hawaii, boosting renewable energy and reducing the state's use of fossil fuels.
Hawaiian Electric said in a statement that it welcomed the commission's clear direction. The company said it has been working on many of the initiatives and it understands the importance of moving quickly. "We look forward to working with the PUC and the Hawaii State Energy Office as we move forward to develop and execute these comprehensive plans," the company said.
Hawaiian Electric provides power in Hawaii, Maui and Honolulu counties through its subsidiaries. Kauai County gets its power from the Kauai Island Utility Cooperative.
One of the orders, related to lowering energy costs and accommodating more renewable energy, affects the Kauai utility as well.