Hawaii Energy Efficiency Program
Our advice begins from the notion that you should “reduce before you produce”. The Hawaii Energy Efficiency Program
offers good information about lighting retrofits, ac upgrades, and other activities likely to show the fastest payback on your money. The Hawaii Energy Efficiency Program
also offers a package of standard and custom rebates on items such as high efficiency lighting, air conditioning, and electric motors. We strongly encourage you to participate in this program if you will be upgrading an existing facility or building a new one.
Once you have implemented proven and cost effective steps such as upgrading your lighting and HVAC systems, it then makes sense to look at producing some or all of your own electricity. Currently there are two standard programs available through Maui Electric Co. Ltd. (“MECO”).
Net Energy Metering (NEM)
Net Energy Metering (NEM) is available for both residential and commercial applications. Under this program, your electric meter runs both ways. When you generate more electricity than you are using, the excess power flows to the grid where it is available for everyone to use. MECO will credit you with the amount of electricity you generate in excess of your own use. At nighttime (for a solar system) or other times when you are not generating as much power as you are using you draw electricity from MECO. At the end of each month you will receive a printout from MECO showing your “net” energy use.
The advantage of the NEM program is that the electricity you generate can be “wholsesale” under the FIT program discussed below. The disadvantage of the NEW program is that excess power is only carried forward for a 12 month period. If at the end of that time you still show a surplus of energy generated that surplus is lost. NEM systems are currently limited in size to 100kW (100,000 watts peak power).
Feed in Tariff
The Feed In Tariff (FIT) program is a newer program approved by the Hawaii Public Utility Commission (PUC) in late 2010. The first FIT system went online in January, 2011. Under this program, MECO actually purchases the electricity you generate using renewable energy. You are still allowed to use part of the power yourself, but you cannot sell power to a third party. The FIT program allows larger sized systems than the NEM program, but the rate you receive from MECO is a lower “wholesale” rate. The exact rate depends on both the size of the system and the type of technology used (solar pv, wind, etc).
Currently renewable energy systems are eligible for both State of Hawaii and federal tax credits. This is true regardless of whether you participate in the NEM or FIT program. For example, a solar photovoltaic (“solar pv”) system would qualify for both a 30% federal credit and a 35% State of Hawaii credit.
As things stand now, the tax credit for residential projects is quite a bit lower than for projects on commercial buildings. There is an annual cap of $ 5,000 for solar pv.