With a new 28-megawatt solar photovoltaic and a 20-MW energy storage system project in the works on the Hawaiian island of Kauaʻi, the island will be getting more than 50 percent of its electricity from renewables. Moreover, the latest system and its energy storage system will provide electricity at rates cheaper than the island’s utility can get from fossil fuel sources.
The Hawaiian islands offer a unique showcase for renewable energy in the US. Given their geographic isolation from mainland US, the primary electric generation source has been fossil fuel, particularly oil and diesel. Importing the fuels are increasingly cost-prohibitive and make energy on the islands the most expensive in the country. In fact, the Energy Information Administration’s most recent figures put the retail cost of electricity for residents at 27.84 cents per kilowatt hour compared to a US average of 12.87 cents per kW/h. As such renewables quickly became a much more attractive option.
The latest power-purchase agreement by Kauaʻi Island Utility Cooperative (KIUC) and AES is among the least expensive wholesale prices yet for a utility-scale solar farm with energy storage. “Energy from the project will be priced at 11 cents per kWh and will provide 11 percent of Kauaʻi’s electric generation, increasing KIUC’s renewable sourced generation to well over 50 percent,” explained KIUC’s CEO, David Bissell. It puts the utility well ahead of other utilities adding in more renewables in the state as well.
That’s even less than the 13.9 cents the utility agreed to pay for a Tesla PowerPack and SolarCity system that it announced a little more than a year ago. At that time the agreement was for the largest battery-based energy storage system yet, a system that could provide up to 13 megawatts of energy to the grid from 5 p.m. to 10 p.m. as needed.
The energy storage system, the largest in Hawaii and among the biggest in the world, also will play a critical role on the island, providing power during peak need hours. Usually, such energy is provided by an older plant that can be bought online to provide extra power but at added costs. The 20 MW five-hour duration energy storage system will provide a less-costly, vastly more clean source for peak energy.
“The project delivers power to the island’s electrical grid at significantly less than the current cost of oil-fired power and should help stabilize and even reduce electric rates to KIUC’s members,” Bissell explained. “It is remarkable that we are able to obtain fixed pricing for dispatchable solar-based renewable energy, backed by a significant battery system, at about half the cost of what a basic direct to grid solar project cost a few years ago.” He observed that the new system will reduce the utility’s fossil-fuel usage by more than 3.7 million gallons a year.
The project is still awaiting final approval. If approved, it should be online by late 2018.Tweet