By Michael Markrich 

Only 20% of the electrical customers in any area in the US have the credit and means needed to qualify for the financing needed for solar panels that would reduce their cost of electricity. This is also likely true in Hawaii. The unintended result of Hawaii’s push for 100 % renewables by 2045 is that while an affluent minority are able to significantly reduce their energy costs through the installation of energy saving renewable technologies, the majority of people in low income communities continue to struggle with choices between electricity or food. The reason is simple the average household of moderate incomes pays between 4% of their income for electricity. Low income households pay as much as 15%. Its an unfair and untenable situation. Perhaps Hawaii needs a social justice fee to improve the lives of the vulnerable in our society.

 

Before Covid-19 struck a young millionaire in Honolulu told me that he felt guilty. He had been an early adopter of solar panels and as a result of the generous state tax write off the Net Energy Metering System (NEM) enabled him to pay for the system years ago, he now paid only $18 per month for more electricity than he could use. He and his friends, who also had the income and the means to sign up for the NEM program, represent more than 60,000 people, 15% of HECOS total, mostly living in Hawaii’s most affluent areas. Many of them have added big screen TVs and other amenities because electricity costs them virtually nothing. All have increased the value of their properties by $35,000 just by having solar.

 

Since then many other programs have taken place beyond NEM and the number of solar panels now reaches nearly 33% of the residential homes in Honolulu. Unfortunately, the many millions of dollars spent to make Hawaii fossil fuel free has made more evident pre-existing problems in Hawaii of energy poverty.

A family of 3 who are renters, without labor income  in Honolulu typically pay $223.28 cents per month while the average working family pays $168.63. Because Hawaii has the highest cost of electricity in the US many on fixed income can barely afford access to electricity and hot water. This can sometimes impact public health for those who find themselves unable to wash clothes and bathe in hot water because they can’t afford it. 

How bad is this situation?:

 

According to HECO, in an average year 1% of its customers ,approx. 4,000 people, have their power cut off for non payment. This impacted an estimated 12,000 people- predominately low income including; the elderly, single mothers, their children, and the unemployed.

Since COVID -19, the number of HECO customers unable to pay has reached 4% -16,000 customers – impacting an estimated 48,000 men, women and children.

 

The problem is made worse since the pandemic because those behind on their payments typically owe at least $1500 in back payments. There is currently a moratorium on payments until May 1. All those who are behind in their payments will be expected to pay some amount of this back.

 

HECO is sponsoring a Special Hawaii Utility Bill Assistance Program combined with Aloha United Way to help all those customers who have fallen behind. There is $3 million dollars available in this fund – enough to give a little relief to a lot of people or perhaps significant help to a few.

 

Additional funding is going to be made available from the City and County of Honolulu Office of Economic Revitalization. They will reportedly be offering a one time $500 sum of federal assistance per household. This is being done in an effort to reduce the debt to those who lost their jobs and could not afford to pay for power. However, even after the debt is reduced many customers will still find it difficult to pay their bills.

This is not to say that other efforts are not being made. The Public Benefits Fund (PBF) specifically states that Hawaii Energy deal with these kinds of social equity issues but it has had difficulty reaching those who need help.

On bill financing was introduced through the State GEMS program to make financing of energy saving improvements.

There is the Low Income Energy Assistance Program (LIHEAP) that is able to help home owners. But their resources are limited

But the problems remain:

There is limited access to affordable financing for low income house holds

Community and education programs that promote energy education are not coordinated

The helping of low income communities is said to be the least important metric of success in

their reaching their goals - according to an article published in the Center of for Industrial Ecology

 

 

The answer to this problem can be found in several ways:

 

1)Community solar; The idea behind this is people can pool their resources into a community solar farm to reduce their bills. These projects are much favored by those working to reduce energy poverty for renters and others.. The difficulty is finding land and signing up enough low income customers interested in doing the paperwork for what is typically only a ten percent reduction in their monthly bills.

 

 

2) Creating a special social justice fund.

This is a simple solution. An additional fee of a set amount is placed on the thousands of home owners who have paid off their solar panels and now pay only a nominal amount – like a bill for public television on a cable bill - these fees would go into an interest bearing fund to increase access to affordable financing so homeowners and renters qualify for the financing of energy saving technologies that offer greater amounts off energy bills such as solar hot water which can reduce monthly bills by 40%. The creation of this fund would likely be a significant stimulus to local renewable energy companies because it will facilitate eligibility and stimulate demand - thereby creating jobs and opportunities. It will also dispense with the red tape and permitting issues that slow down the implementation of all kinds of improvements

 

3) Committing to universal basic electricity so that no family needs to go without electricity. Since the utility is a corporation regulated for profit. Why not allow every household at poverty level to be assured by the State Public Utilities Commission they would pay no more than 4% of their per capita income for electricity. This would alleviate enormous stress on poor families and ensure that everyone has access to hot water for bathing and clothes washing. This is essential in a community that has just gone through a pandemic for health purposes. The difficulty with this approach is that critics will say it will encourage “free riders” - people not wanting to pay their bills at all. On the other hand if such a program is carefully managed and limited to those living below the poverty level - it may be a great help for people and help in maintaining community health.

 

One might ask why it is necessary to eliminate energy poverty in Hawaii. Because fair access to basic electricity for the poor and vulnerable should be also be one of the Hawaii’s energy goals.