Is the electricity price lower during the day than at night?

Kauai, located at the northern end of the Hawaiian Islands, made an attempt to subvert common sense.

In general, the balance of supply and demand at the peak of electricity is regulated by the import of fossil fuels that can withstand dramatic changes. However, the cost of petroleum thermal power generation is relatively high. Therefore, in order to reduce the power supply cost, the nighttime power price reduction and the like have been promoted in order to shift the demand from the largest day to the "peak peak" of other time periods.

However, Kauai is from 9 am to 3 pm, the unit price of electricity is "cheaper" than at night! The reason is actually photovoltaic power generation.

Kauai Island UTIlity Coop (KIUC), a power company operating in a non-profit cooperative portfolio for Kauai, has the largest solar panel output power of 14.5 MW (with a grid-connected output of 12 MW) in Hawaii. Started operation in early November (Figure 1)

Figure 1: The largest million PV power plant in Hawaii. Panel capacity is 14.5MW (Photo: REC Solar)

Hawaii with the highest PV penetration rate in the United States

In the United States, when it comes to "the leading region of photovoltaic power generation," people first think of California with more than 50% of the United States. However, from the perspective of per capita photovoltaic power generation, the state of Hawaii is far ahead of California, and it is the real No.1. Because 12% of homes in Hawaii have photovoltaic systems. Why is the introduction of photovoltaic power generation in Hawaii, which is made up of small islands and is not vast? The reason is that the state has the highest electricity price in the United States. According to 2014 data released by the US Department of Energy (DOE) Energy Information Division (US Energy InformaTIon AdministraTIon: EIA), the average unit price of household electricity in the United States is 12.5 cents/kWh, while the average unit price in Hawaii is 37.34 cents/kWh. It is about 3 times the overall average of the United States. By the way, California's average unit price is 16.29 cents / kWh, about one-half of the state of Hawaii. That is to say, the “blessing” of the high electricity price, the state of Hawaii has taken the lead in achieving grid parity (the cost of photovoltaic power generation is the same as or lower than the electricity price). The investment efficiency and economic benefits of photovoltaic power generation are also exceptionally higher than those of other states.

The massive introduction of photovoltaic power generation causes an imbalance in demand

The largest million-meter photovoltaic power plant in Hawaii, which is running in Kia, Kauai, is called “Anahola”. It has laid 56,000 solar panels to meet 20% of the island's daytime electricity demand. In order to reduce the load on the power system of the photovoltaic power station, a lithium ion battery (produced by Saft, France) with an output of 6 MW is also installed.

KIUC carries out a full range of power services including power generation, power distribution and retail, and currently has 33,000 customers. Within the jurisdiction of KIUC, the power generation business uses a million photovoltaic power plants combined with residential rooftop-mounted photovoltaic power generation equipment, and about 50 MW of photovoltaic power generation equipment is generating electricity.

By the way, the power company expects that by the end of 2015, renewable energy such as millions of photovoltaic power plants will meet 38% of electricity demand (Figure 2). Moreover, in the state of Hawaii, which passed the first US Renewable Energy 100% Act in June 2015, photovoltaic power generation is expected to become more popular. However, the large-scale introduction of photovoltaic power generation also has problems.

Figure 2: Comparison of power generation of various resources of KIUC. 2009 and 2015 (Source: KIUC)

Set daytime electricity prices to be 25% lower than nighttime

In Hawaii, the peak demand for electricity is at night, so photovoltaic power generation during the day will be imbalanced between supply and demand, which may cause the power system to malfunction. The typical daily electricity demand load (daily load curve) in Hawaii is the lowest in the middle of the night to early morning, and then gradually increases (Figure 3). The daytime is relatively flat, and it continues to rise sharply after 5 pm, and the maximum demand (peak) is reached after the evening. In some areas, even the generation of photovoltaic power generation has significantly exceeded the demand for electricity during the day.

Figure 3: Hawaii's one-day power demand load (daily load curve) (Source: HECO)

In order to prevent the photovoltaic power generation suppression output that is not easy to set up, and to reduce the operation of oil thermal power generation during nighttime peak hours, KIUC has formulated a power plan to shift the peak power consumption from night to day.

KIUC reduced the unit price of electricity by about 25% (equivalent to about 8 to 10 cents/kWh) from 9:00 am to 3:00 pm in the output of photovoltaic power generation systems. This price plan has been implemented for home customers who have set up smart meters, and it is said that priority will be given to apartment tenants and families who cannot set up photovoltaic systems because they do not have enough funds.

KIUC will provide participants with a free display of real-time display of power consumption. In addition, in order to promote daytime power consumption, a new equivalent of $200 will be provided for the installation of a timer for electric water heaters. It is said that the project will be piloted for one year. Data will be collected to determine whether it is to expand the project or include commercial customers. Official participants have been recruited in October 2015 and will be implemented in the first quarter of 2016.

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