Battery Bonus Program
APPLICATION DEADLINE IS APPROACHING:
Hawaiian Electric is allowing customers to expand their Net Metered PV system as part of their Battery Bonus/Scheduled Dispatch (SDP) program, but you need to act fast! HECO’s battery bonus program will stop taking applications on February 29, 2024 or until the 40MW cap is reached, pending a PUC order for a new program end date.
The Public Utilities Commission has capped the program at a total 40MW supplied from storage.
If Accepted customers will receive $850 per kilowatt.
Customers who wish to participate with an existing solar system and are presently enrolled in a customer energy program (such as Net Energy Metering, and Grid Supply or others) will continue to receive full benefits from these programs. Up to 5 kW of new panels may be added under existing programs. There is no limit on the size of an individual customer’s battery.
This program is available to new and existing residential and commercial customers with rooftop solar and a battery storage system charged from on-site solar generation under the Hawaiian Electric’s Net Energy Metering, Customer Self-Supply, Customer Grid-Supply, Customer Grid-Supply Plus, Smart Export or Standard Interconnection Agreement programs.
The owner of the solar-plus-storage system will receive the incentive. That can be the customer owning the system or a company that leases the system to the homeowner or business.
The total program term is 10 years. Customers who participate must use and/or export electricity stored in the battery at the committed amount on a firm two-hour schedule specified by Hawaiian Electric between 6 p.m. to 8:30 p.m. (for example, 6:15 p.m. to 8:15 p.m.) daily including weekends and holidays through December 31, 2023.
Once the battery is installed and operational, there is a 30-day period to confirm the system works properly. Seven consecutive days of operational performance data will be collected to show how much the battery is exporting during the peak period, verifying the incentive amount. Hawaiian Electric must pay the incentive within 30 days after the data is delivered.
Customers must work with a solar contractor to add storage to an existing solar system or install a new solar-plus-storage system.
The contractor will help fill out forms and submit them through Hawaiian Electric’s on-line Customer Interconnection Tool. Securing a building permit with the City & County Department of Planning and Permitting or proof of permit application is required as part of the application, and will determine the incentive amount.
Customers may end participation before the 10-year commitment with a 60-day written notice to Hawaiian Electric and must repay a prorated portion of the incentive.
Please refer to Hawaiian Electric’s website for more information.
If any updates have been made to the information on this page they can be found here.
Energy Incentives from the Heco Solar Battery Bonus Program
Living in Hawaii provides several benefits, like vibrant colors, beautiful ocean views, and seemingly endless sunshine. The access to the sun makes Hawaii the perfect candidate for solar energy.
As of the first quarter of 2022, Hawaii had enough solar energy to provide 17% of the state’s electricity and power 368,496 homes. But that’s not where they want to end. With ample access to the sun, it’s no surprise that Hawaii’s goal is to use 100% clean energy by 2045.
To help homeowners achieve this goal, Hawaii Electric Company (HECO) is now providing energy incentives to customers who add battery storage to their new or existing rooftop solar systems.
HECO Solar Programs
The electricity rates in Hawaii are among the highest in the United States. However, those who’ve switched to solar power have received great energy incentives and have also reduced their electric bills. Here are some of the incentives available to Hawaii Residents:
Federal Solar Investment Tax Credit
This federal tax credit for homeowners investing in solar energy sits at 26%. However, it only applies to systems installed before December 21, 2022.
Renewable Energy Technologies Income Tax Credit
Hawaii Residents installing solar energy systems may apply for a 35% state solar tax credit with a maximum of $5,000.
Green Energy Money Saver Program
Those who rent or have low to moderate income may apply for this special financing on rooftop solar systems.
Honolulu Solar Property Tax Exemption
This incentive provides tax exemption on the additional value added to your home from rooftop solar panels.
The New HECO Solar Program
HECO partnered with the Public Utilities Commission to develop a new Demand Response Scheduled Dispatch Battery Bonus program, allowing customers to add solar panel and battery storage systems. Residents will rely less on the grid with more solar energy generated daily.
Homeowners will create their own energy, store it, and use it when the grid needs the most help. This program aims to help more home and business owners commit to going solar while improving grid reliability and preventing higher utility costs.
Local homeowners can receive thousands of dollars as an incentive to add solar batteries and send electricity back into the grid. These factors make this program a transformational step for residential solar power and batteries.
What Is a Demand Response Program?
A Demand Response program is an agreement between the utility and homeowner that changes how a homeowner uses or stores energy. Through this setup, the electricity grid becomes more stable, reducing power outages and the cost of operating fossil fuel plants.
Each Hawaiin island has its own grid, making them vulnerable to power outages due to natural disasters or other factors. However, as more residents shift to solar energy, the electric grid’s work changed. Net Energy Metering initially required homeowners to send solar power back into the grid during the day.
Due to the grid’s sensitivity, HECO declared that it couldn’t handle any more electricity from residential solar systems. Therefore, Hawaiian Electric mandated that any homeowner wanting to add solar had to invest in a battery backup for additional energy storage.
As a result, the grid became protected from any excessive energy flowing back into it.
With the new mandate in place, HECO now has access to large amounts of energy production and storage while providing incentives to homeowners.
How the New HECO Solar Programs Work
A year ago, Hawaiian Electric launched an incentive program for O’ahu residents, testing their new solar energy incentives.
Customers who added energy storage to a new or existing rooftop solar system received a one-time cash incentive, followed by monthly statement credits. As they used their solar energy, any extra energy saved into the battery got sent to Hawaiian Electric for redistribution.
Soon, HECO will be expanding its energy incentives for Hawaii battery storage to other residents of Maui County. Any customer accepted into the program will get $850 for each kilowatt, with a program cap of 15 megawatts for Maui and 50 megawatts for O’ahu.
Hawaiian Electric wants to encourage customers to invest in battery storage to help eliminate the use of coal and oil plants, allowing the company to retire these systems. There have been no limits placed on the battery size, and you may still be eligible for federal and state tax credits up to 35%.
Who Is Eligible for the Battery Bonus Solar Programs?
Any new or existing residential or commercial solar customer may qualify for the Hawaii battery storage program, whether you have rooftop solar and invest in a battery or purchase the whole set up. You are eligible if your electricity comes from at-home solar production under the following programs:
- Hawaiian Electric’s Net Energy Metering
- Customer Self-Supply
- Customer Grid-Supply Plus
- Smart Export
- Standard Interconnection Agreement
Only the solar energy system or battery storage owner qualifies for the energy incentives. An owner is either a private customer or a company leasing the system to a homeowner or business.
What Do I Need to Receive the HECO Battery Bonus?
Use the following checklist to determine whether your home or business is prepared to receive the HECO battery bonus:
- Enrollment in an approved Hawaiian Electric renewable energy rate program
- Installation of a new battery
- Commitment to let the utility use the stored energy for two hours every day
- Permit application on file with county building departments
- Application made through the Customer Interconnection Tool
- Commitment to sending operational data daily
- Provision of a W9 signed by the owner of the battery
Checking off this list will ensure you are prepared to receive any qualified incentives for the Battery Bonus Program.
Why It Pays to Adopt Hawaii Battery Storage Early
You’ll have more to gain when you’re one of the first to participate in the new HECO solar programs. The $850 per kilowatt incentive is available for customers participating in the first 15 megawatts. After that, the incentive decreases to $750 for the next 15 megawatts, then drops again to $500 for the remaining 20 megawatts.
At the first tier, using five kilowatts would equal approximately $4,250 in payment from HECO.
These solar-plus-storage payments are classified as income. Therefore, Hawaiian Electric provides battery bonus program participants with a tax form and conveys information to the necessary governing bodies, including the IRS and the Hawaii Department of Taxation.
If you currently participate in other HECO incentives, like Net Energy Metering, you can continue reaping the benefits while joining the Battery Bonus incentive by purchasing a qualifying battery.
It’s the perfect opportunity to begin benefiting from home energy storage while supporting the grid serving all customers. These small steps will bring Hawaii closer to 100% clean energy by 2045.
Utility Energy Efficiency Programs at Work
It’s important to note that when you sign up for the program, you’re committing to a 10-year term. During the first part of the program, which lasts until the end of 2023, utility companies will use customers’ batteries for two hours daily.
This usage will fall between 6 p.m. and 8:30 p.m. throughout the week, including weekends and holidays through December 31, 2024.
HECO will regularly check battery data to ensure customers meet their quota and receive the complete incentive. After that, you will transition to the next phase according to the terms of the program.
Customers not enrolled in HECO’s Net Energy Metering Program may still receive an incentive, but it will come in the form of a fixed monthly bill credit for any energy exported to the grid.
Users will be eligible for this incentive for three years. This credit is approximately the same as the individual retail rate for electricity exported during the two-hour window.
The Department of Planning and Permitting requires that customers have a building permit from the city or other proof of permit application. These permits will help determine the final incentive amount awarded.
Participating in HECO Solar Programs
After acceptance into the program, you must work with a solar installation company to purchase and install storage for your existing system or include a battery storage system. Hawaiian Electric recommends requesting bids from a minimum of three contractors to compare installation rates.
Once the installation of your rooftop solar system or battery storage is complete and working, you’ll have approximately one month to verify the system performs as expected.
HECO will collect seven straight days of performance data to confirm how much energy the battery exports. The incentive amount is verified during this time, too. After receiving the data, Hawaiian Electric has 30 days to pay the incentive.
You can submit applications through June 23, 2023, or until consumers reach the 50MW limit. All applications must be reviewed within a month of receiving a completed and correct amendment request.
Then you’ll work with your contractor to determine how many kilowatts you will commit to maintaining the discharge level from your battery storage system.
Failing to Perform
Sometimes equipment malfunctions and HECO has a plan for that. If your system doesn’t deliver the anticipated amount of energy, HECO will review your system to ensure it’s working correctly. But a review is only necessary if the amount of power released by your system is more than 125% different than the baseline.
After reviewing your system, if HECO finds that it is out of compliance with the utility energy efficiency programs requirements, they’ll issue a Failure to Perform notice.
The owner will have 30 days to prove they resolved the problem. Failure to notify HECO of a solution results in a $100 penalty on the monthly energy bill until the issue gets resolved.
Early Termination of Participation
Customers may opt out of the program early, but you must submit a written notice 60 days before you wish to terminate your contract. However, you must reimburse some of the incentives received based on how long your battery has been installed.
Why HECO Offers the Hawaii Battery Storage Program
HECO offers these exceptional utility energy efficiency programs because the utility wants more people drawing energy from the grid.
The sun sets later in the day, and more people are at home during the peak hours preparing dinner and finding ways to relax. Drawing solar energy from the grid will reduce the use of fossil fuels across the islands.
When more people are at home, HECO must generate more energy quickly, costing significant amounts of money and increasing pollution. To combat this, HECO wants solar customers to charge their batteries throughout the day, giving them access to stored energy during peak times.
Customers use more clean energy and help their neighbors avoid paying the high electricity fees resulting from rapid fossil fuel energy production.
Disadvantages of the Program
There aren’t many disadvantages to the HECO energy incentives, but there is an important one to note. You’ll have access to battery storage, but it won’t serve as reserve energy you can count on during a power outage. Instead, you’ll have to discharge the energy daily, including on weekends and holidays.
For example, say the battery storage you have installed holds 20 kWh of energy. If you discharge 5 kW of power during the daily two-hour window, you’ll actually be releasing 10 kWh total. After the peak discharge period, you’ll have 10 kWh remaining to power your home if there is a power outage the same day or early into the next morning.
Is This Program Right for Me?
This question is essential to answer before committing to installing a solar battery, and there are many factors to consider. A driving force for many customers is reducing their current electric bills. You must think about how long it will take for your solar system or battery to begin paying for itself.
For other customers, they are looking for the best way to reduce their carbon footprint. Participation in this program reduces reliance on fossil fuels, contributing less to polluting the environment.
Invest in Battery Storage with Help from RevoluSun
If you have questions about the new HECO Battery Bonus program, don’t hesitate to call the experts at RevoluSun. We are a full-service solar company striving to exceed industry expectations and satisfy every customer. Contact us today to learn more about rooftop solar systems and battery backup installations!