 cold green sink tech Hawaii Monday, August 30th, 2021. Thank you very much for attending. All of you know that Hawaii was the first state to declare 100% clean energy by the year 2045. Question, how in the world are we going to achieve that very, very, very powerful vision? Part of it, a large part of it is due to old soil up there. We have the best sun regime in the entire nation, not surprising, and back in the 1970s, we started really pushing solar water heating, which is great. You get all the water heated during the day. People come home from school in the evening just when the sun's setting and you've got an 80 gallon battery full of hot water there that really, really helped us keep dollars in Hawaii instead of exporting the dollars to the oil people overseas. Then of course came PVs, photovoltaics, solar energy to electricity, and we succeeded wildly in that so much so that in the middle of a sunny day, there was too much electricity being produced and the utility was actually having to dump it. So then came solar batteries. They're about half the size of a refrigerator installed in garages or just outside, and they take all that excess daytime electricity from the sun, store it and then use it in the evening, just when the sun's going down and when we have our peak demand when we're using most electricity. So we were adding layers of complexity, but if we're gonna get to 100% clean energy, we're gonna have to get a lot more complex than that. Enter our guest today, Robert Ruckymold, president of Hawaii Solar Energy Association and a long, long, long time involved in the clean energy field, one of the true subject matter experts in the field. Welcome, Rocky. I have just set the table. Can you talk about EER, distributed energy? Yeah, go ahead, Rocky. Resources, yeah. Thank you so much, Howard. It's great to be here. So yeah, I've worked with Howard for many years now in the Hawaii ecosystem. So it's great to be on. Yeah, that was a really good description of sort of the sequence of where we are now. I now represent the Hawaii Solar Energy Association. We are the largest solar trade organization here in Hawaii. I represent over 100 local installers as well as national and international equipment manufacturers that are all trying to work on this complex problem of getting us to 100% renewable energy as quickly, as cost-effectively as possible. And distributed energy resources have been leading the way. And distributed energy resources are what Howard described. They are rooftop solar and battery storage as well as solar hot water, both on residences as well as in the commercial space. And really as we get to high levels of penetration, I think Oahu were at about 30%, 35%, sorry, I don't have the exact figure. I should know that. The state is at about 35% right now in terms of penetration. As you get higher and higher, you sort of have, you have more systems to manage and getting them to interact with the grid and to set the incentive level correctly through the pricing signals to cost-effectively shift that solar generation in the midday to the peak period in the evening, but also to shift behavior of customers so that they use energy at times and store energy when they need to. And we're in a really exciting time. I'll probably get more into that. As we retire fossil fuel plants, the recent, the retirement of the AES coal plant is happening next year and doing some modeling the Public Utilities Commission and HNEI, the Hawaii Natural Energy Institute. Along with HECO saw potential energy shortfall due to the retirement of that large 180 megawatt fossil fuel plant. So the PUC has asked the parties in what's called the DER docket to come up with ideas for how to use distributed energy resources, rooftop solar and storage as a system resource to help fill that energy shortfall. And so we're getting into sort of a new era more quickly than we thought where distributed rooftop systems are being organized and pulled together as a fleet to be a system resource, to be a large resource to meet a big grid need. And HSEA through the DER parties put a proposal together, which was called a Scheduled Dispatch Program, which actually is doing exactly what Howard said. It's actually providing a performance payment an upfront performance payment for someone to add additional storage to their system. And that storage, that system will have to be preset in a certain way so that it does, it takes energy from the midday solar generation and shifts it into the six to eight PM peak time period. So I think the future really is, the future really is having sort of a customer-focused market that's a sustainable market for customer-cited systems that are actually being managed by some kind of central operator or in this case it's being preset but eventually there will be actually a central operator that will manage those resources and the timing of when they'll be turned on and turned off and add into that. And the really exciting thing right now is really electrifying sort of everything and that includes our transportation fleet and getting the technology to organize when EVs are charging from solar energy and from batteries is sort of where we're going and there's just a lot of innovation is occurring in this space and it's just really exciting to be doing this in Hawaii because Hawaii is truly a unique place to be doing this. And you mentioned EVs, electric vehicles. As I understand it, electric vehicle owners can enter into an agreement with the utility saying, utility says, hey, you've got a lot of electricity stored in that big old battery. We could use some right now. We're gonna tap into this. Can you give us a break for that? Is that part of our future actually using EV batteries as part of one of those storage options? I think that is part of our future. That's what we're going for. It's not there yet, but an EV battery has more capacity and more power potential than the batteries that we're putting on our homes. I mean, so it's a really powerful battery. So getting the vehicle to grid or building to grid or building to vehicle type technologies connecting those all together is happening. It's coming, but it's sort of not quite there yet. I think one of the exciting things in Hawaii is we have this amazing test bed because we are an isolated grid and we actually have a pretty small island where EV ranges work really well. So we don't have a lot of the problems that they have on the mainland in terms of range anxiety. And so we're just a great place for electric vehicle companies. And energy charging infrastructure companies to come and prove out sort of new business models and ways of having vehicles in the grid and solar panels all work together. Yeah, that's a really exciting possibility. And hopefully, hopefully we're going to get more and more and more and more electric vehicles on the road because if we're going to electrify, we've got to have our cars electrified also. But in terms of this grid interconnection, there are tens of thousands of PV systems out there sitting on tens of thousands of roofs. How in the world do you get them to interconnect with a grid? It sounds absolutely mind-boggling. Yeah, I know it said that, I mean, there's some really smart guys, smart minds are looking at that problem and what you need going forward. A lot of it's called the inverter technology that controls the PV panels and controls the interconnection point to the grid. And it's firmware and kind of software that is set in the systems to respond to a signal, like some kind of remote signal via telecommunications or like some kind of mesh net type of portal. So that stuff is in that firmware and it's just sort of the processes for how to go about doing that are still being worked out. I mean, there's a really, there's a big process to get the interconnection and the communication protocols together for those inverters that will enable them to do that, that will enable them to be remotely dispatchable is what we say. So all of that work is happening with HECO and in the DER docket and the grid modernization docket before the Public Utilities Commission. There's a big proceeding in California that's looking at the new sort of communication standards that are being put in inverters. And HSEA and my member companies are luckily at the table looking in on those proceedings and intervening and putting our comments where we can to help lead the way. And Hawaii really is, as I was saying because of our unique circumstance of being an isolated grid, we really are at the forefront on a lot of the stuff. In fact, I've heard California is actually looking at what we're doing with our emergency DR program when I was mentioning before with the retirement of the AES coal plant and our scheduled dispatch or battery bonus program. I've heard that California Utilities in California or the Commission in California is looking at that as a potential model to get ready for next year's fire season. Because they've been having significant issues with their transmission lines and generation going down because of the fire season. So DER's rooftop solar and storage just on its own, I mean, it helps for resiliency purposes when you have grid outages that occur. If you think about it, if we have 70,000 customers who have distributed systems here, not all of them, obviously, not all of them I think can go if they're off grid, but a significant portion of those will be able to island in the case of a grid outage. And that's 70,000 customers that aren't, that the HECO's not gonna need to worry about as much to get interconnected to get them power that they need. And that actually happened in California with the last fire season. There was something like 38,000 systems that kicked in when the grid went down because of fires and kept people's lights on, kept people's refrigerators going, kept people's water pumps going, kept their medicine cool when the grid went down. So there's also a significant resilience benefit to distributed systems. Yeah, and as I understand it, with this island effect, I like that, normally a PV system on somebody's roof is feeding into the grid or feeding into storage. And what a utility doesn't want when the whole grid goes down is people still feeding electricity into those wires. That is not a good thing for the repairmen who are up there on the wires. So there's a capability in that shutdown grid off, you shut down the interconnection between the residential system and the main grid. And now you can use it, you can have it all by yourself. Is that a very simplistic explanation of that? That's a very good explanation. This can be done back in the day, it was done physically with a natural switch that you would pull. Now through inverter technology, it's getting much more sophisticated and much more sensitive. I mean, inverters are sensitive to grid conditions and are able to automatically shut down and modulate exports or imports based on grid conditions. And that's all, again, all in that inverter technology, which is really the brains of the systems that we're putting on these days. Beautiful. Yeah, and islanding can be done at various different scales if you think about it. It can be done at a home, it can be done on a fleet of homes, it can be done for businesses that might become a resilience hub. There's microgrid technology, which is, and microgrid processes that are in tariff structures that are being thought about and formed here to come up with the rules of the road for this new future that we're going into. I mean, I think it's really important to make this point. A lot of this is about setting the incentives properly through rates and through tariff structures and programs. And what we're doing right now in, before the Public Utilities Commission in the DER docket in particular is setting those sort of new rules of the road, the new tariff structures and incentive payments going, incentive structures going forward. And of course, there's also, there was the performance-based regulation proceeding still ongoing before the commission that actually was looking at rewarding the utility for achieving public policy or other kind of grid goals. So that their profits, so that their revenues would be tied to sort of societal public policy goals to like our 100% renewable energy mandate, things like that, as opposed to sort of the sort of old way of utility rate making, which is really based on cost. And so that was embedding some not great incentive into the system. Did we think of that or are we following California or another state on that initiative? I think we're one of the states leading the way. I think, you know, they're, you know, New York, gosh, Minnesota have done, in California have done whole parts of this, but I think are, you know, and there's always been, you know, this type of performance-based rate making in terms of, you know, revenues, having an automatic rate setting that would take sort of the utility out of, they would get their required return, regardless of sort of what they were doing. And by setting the automatic, sort of an automatic revenue sort of formula, they're actually taking sort of this incentive to invest out of the system. But, you know, so places have been putting that type of rate making into place, but I think where Hawaii really is sort of ahead of the game is on the performance incentive mechanisms that are really tied to some of the higher level, you know, public policy and societal goals in terms of, you know, greenhouse gas emissions and things like this. Yeah. Well, to shift gears to something much simpler, maybe it's more simpler, maybe not. It's called time of use pricing. And I know Hawaiian Electric has been doing a pilot project for a long time, but how about this real simple idea? We've mentioned that during the middle of a sunny day, you have all this electricity that is being produced much, much, much more than is being used at the time. What about incentivizing Mr. and Mrs. Housewife to at that time, just say the real peak starts at 11 in the morning, boom, 11 in the morning, the dishwasher comes on, by itself you've timed it. And then at 1230, the clothes washer comes on and at two o'clock, the dryer comes on, all automatic so you can suck up a lot of that energy. You emulsify that example by 10,000, 20,000 households and you're talking some pretty serious energy here. Has that been sort of, yeah. Well, yeah, there is a program where, you know, hot water heaters are connected to the utility, a residential load demand response program. So yes, that stuff's been thought of, but you know, Hawaii were, you know, we are, the DER party is an HSE being part of it. We've proposed a time abuse rate structure before the utilities commission and we're hoping for an order sometime soon on that. The other interveners in the docket have also put their ideas in for a time of use type of rate. But the stuff you're talking about where you're tying in appliances, you know, automatically to those time of use, that's an interesting idea. I'm pretty sure folks are looking at that. I haven't heard of much of that here, but you know, specifically, I think that's more on the sort of energy efficiency side of things, which is always, you know, super important. But yeah, I think, you know, the Department of, US Department of Energy has a whole, you know, smart homes program that's looking at these, how to again, how to integrate all of these, you know, your energy use, your appliances, your solar, your battery storage, your electric vehicle, how you sort of integrate all of that stuff, you know, through technology and through, you know, inverter settings and have it all connected to some kind of remote, remotely dispatchable, you know, an operator that's looking at the whole grid and what grid needs are. That is coming. It's still, it's taking a while to work all the pieces out. You know, I mean, you know, homes, you know, last for a really long time, 50 years and more. And so, you know, a lot of our built environment still needs to be, you know, upgraded to be able to do this kind of stuff. And that's a lot of what, you know, what a lot of what you do at the Codes Council, Howard, in terms of, you know, updating energy codes, energy efficiency type stuff. Just a little aside on resistance heaters. Those are the water heaters that you and I grew up with in our homes. And all they are are big tanks with these heating elements in them. And when you want hot water, bloom, a heating element goes on and it just stays there till the water is heated up to usually 125, 130 degrees. Now, when I first started with the energy office, which was just about the time your parents met one another, the typical residential electricity bill or consumption was around 1000 kilowatt hours a month. Now it's 600 kilowatt hours a month. You say, wait a minute, there are so many more electric using items within a home, especially if you have kids and you have six Julian video games or whatever you have at three televisions and a refrigerator that makes ice and does everything else but wash the dishes shouldn't the per capita electricity use in a home be going up, up, up largely because- Yeah, so I mean, so yeah, energy efficiency has been a huge success going forward. Like, while, and there's this kind of, there's this effect where when someone puts on solar, they may use a little bit more energy, but all their appliances are now so much more efficient that we are seeing electricity usage going down because of energy efficiency and because of solar hot water being put on, put on. But yeah, I think getting people's behaviors to change is still probably one of the most difficult things to do. And so, you know, luckily through improved efficiency and technology, we're getting in a lot of that but still there's improvements that need to be made for sure. Well, back in the day, if you did a pie chart of residential energy use, 40% would go to hot water heating, put that solar on the roof and it goes down to more like 4% maximum because most solar water heaters are sized such that you virtually never need the backup heater. So that was one of our great, great, great innovations way back when. Rocky, we've only got about two more minutes. Give us a scenario of the grand future of all of these thousands of systems interconnected such that only as much electricity is being used as is needed at that second and the demand drops, the supply drops, total, total integration of thousands of individual items. Well, yeah, that's hopefully where we're going. And it's all, you know, most of it is going to be, you know, fueled by the sun, right? I like to think of solar energy as the fuel of the future because that is such an abundant resource here and it's our ability to take it in when it's available and then use it when we need it. That's kind of the simple thing for the future. Another thing, it's going to be a complex thing for the future, but it's, you know, but we'll see. Another thing I'd like to add is it's really important to start looking, there's other ways that, you know, and other policies that we need to put into place going forward to help us get there and it's like reducing the soft costs for installing all this. In order for us to get to 100% renewable energy and the distributed future, there's going to be a lot of investment and a lot of projects that we're going to have. And so bring down the costs and the barriers to getting those permitted is going to be super important for our future. And it's something we're laser focused on at HSEA as well. Beautiful, would that be primarily through text credits or a whole, Mr. Funding, financing or? Well, obviously the tax credit's an important tool, policy tool for the federal government and for Hawaii to achieve these goals. We're also talking about, you know, improving permitting processes and, you know, an online permitting tool, tools and things like that. We are, HSEA is a member of an organization called the SolarAPP Campaign. The SolarAPP is a online permitting system developed by the National Renewable Energy Laboratory. And, you know, we are working with getting that implemented across, you know, as many jurisdictions as we can. Most recently, Energy Secretary Granholm, you know, launched an initiative with SolarAPP and challenged states and jurisdictions to really speed up the pace of getting SolarAPP implemented. And we're, so we're working with our partners on the mainland in, you know, California, back east and other states to get that SolarAPP implemented as quickly as possible, because it really will, not only will it lower the time and cost of permitting, but it's also gonna make it more, you know, more safer, because it's the best in practice system that will really help jurisdictions make sure that projects are being put in correctly and that they're being designed correctly for public health and safety. Beautiful. And guess which state is gonna be leading the entire nation a little old Hawaii, especially if you have anything to say about it. Rocky Mold, President, Hawaii Solar Industry Association, and by honored guest, you've given us a peek into the clean future, Rocky. Thank you so much. Signing off, it's Howard Wigg, Cold Green, Sink Tech, Hawaii. See you next time.