Governor David Ige signed the Performance Based Ratemaking bill (also known as the Hawaii Ratepayer Protection Act) on April 24, which further aligns utility ratemaking processes with the state’s renewable energy goals. Hawaii will be the first state to have performance-based ratemaking mechanisms in statute, making it one of the most progressive states for energy policy.

Hawaii Pacific Solar president and CEO, Bob Johnson, says: “This is a clear example of Hawaii being on the cutting edge of energy legislation.This bill will compel the utility to be performance oriented and ally their success with the best interest of their rate payers.”

The bill sets 2020 as the deadline for the state Public Utilities Commission to establish different incentives and penalties that directly tie electric utility revenues to the utility’s achievement in hitting various customer-focused performance metrics.

Performance metrics include: affordability of electric rates and customer electric bills; service reliability; customer engagement and satisfaction, including customer options for managing electricity costs; access to utility system information; rapid integration of renewable energy sources; timely execution of competitive procurement.