Tesla has applied to sell electricity in Texas

Elon Musk
Tesla and SpaceX CEO Elon Musk.

  • Tesla applied with a Texas agency to sell electricity on the retail market in the state.
  • It would do so through a new subsidiary, Tesla Energy Ventures.
  • CEO Elon Musk and his companies have grown their presence in Texas in recent months.
  • See more stories on Insider’s business page.

Elon Musk just moved to Texas. Now, he wants to sell electricity to people in the Lone Star State.

As Texas Monthly reported Thursday, Tesla Tesla applied earlier this month with the Public Utility Commission of Texas earlier in August to sell power on the retail market through a new subsidiary dubbed Tesla Energy Ventures.

The magazine reports that Tesla could sell energy directly to the state’s deregulated electricity grid, which is called ERCOT. Texas is the only state with its own power grid that doesn’t share energy with neighboring states.

The move could let Texans whose homes are outfitted with solar panels share power with the state’s electrical grid. And as the outlet noted, that could even allow those homes to operate as their own power plant, connected via the state’s grid.

According to the filing, Tesla could leverage its network of solar panel customers in the state to build a userbase, marketing to them through the mobile app and the website. Federal energy data shows that Texans have installed more than 1 gigawatt of personal solar panels to date, per the report.

The commission will decide on the application’s approval or disapproval in November.

The new initiative would follow Tesla’s already-reported move to build two giant mega-batteries in Texas: one near Austin close to the Gigafactory site that’s still under construction and another near Houston, as Bloomberg reported in March.

Texas is still reeling from a brutal wave of power outages caused by a bout of inclement winter weather in February. More than 100 people died, and millions of Texans were left without power for days in the bitter cold.

Since then, some electricity suppliers have left the market, and thirteen new ones have applied with the PUC to sell power in Texas, the commission told Texas Monthly.

As for Musk, he said last year that he’s moving to Texas, and both his Boring Company and Tesla have a large presence there.

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Elon Musk is defending Tesla’s acquisition of SolarCity against angry shareholders. This is the story of how it was transformed into Tesla Energy.

EM   Photo by Christophe Gateau:picture alliance via Getty Images
Tesla CEO Elon Musk.

  • Elon Musk is defending Tesla’s 2016 acquisition of SolarCity in court.
  • SolarCity was founded by Musk’s cousins, and some shareholders say the acquisition was a bailout.
  • Once the top installer of solar panels in the US, SolarCity was turned into Tesla Energy.
  • See more stories on Insider’s business page.

Five years ago Tesla bought SolarCity, the biggest installer of residential solar panels in the US. Tesla CEO Elon is now having to defend that decision against shareholders, who claim the acquisition amounted to a bailout.

If Musk loses, he’ll be liable to pay up to $2.6 billion back to Tesla. Although this would make up only a fraction of Musk’s fortune – at time of writing his net worth stands at $179 billion per the Bloomberg Billionaires Index – Wedbush analyst Dan Ives said the case is a “black eye” for Tesla and could do serious reputational damage.

The case hinges on whether Musk exerted undue influence over Tesla’s board, and whether he misrepresented SolarCity’s financial health. Originally, the suit targeted the whole Tesla board as well as Musk, but the other board members agreed to an out-of-court settlement for $60 million in January 2020.

Musk’s appearances in the witness box this week were characteristically bombastic, with the Tesla CEO throwing personal insults at the plaintiffs’ lawyer and claiming his sense of humor drives sales. As part of his defense, Musk said the acquisition of SolarCity was part of a master plan.

“The goal is not to be a car company. There are plenty of car companies, but an electric car company is part of a sustainable energy future, as is solar and stationary storage,” Musk said, per the Wall Street Journal.

After the 2016 acquisition SolarCity was transformed into Tesla Energy, which has had to contend with multiple lawsuits, solar panel fires, and production problems.

How SolarCity became Tesla Energy:

SolarCity was founded in 2006 by Elon Musk’s cousins Lyndon and Peter Rive.

Lyndon Rive.JPG
SolarCity cofounder and former CEO Lyndon Rive.

Musk’s cousins founded SolarCity at his suggestion, and Musk injected $10 million into the project himself.

The company initially enjoyed success, and in 2013 became the top residential installer for solar panels in the US, according to solar panel comparison site Energy Sage.

Its stock peaked in February 2014 at $88.35 a share — but then it began to go downhill.

SolarCity ran into major problems in 2015.

solarcity
Home installation.

In October 2015, a quarter of SolarCity’s value got wiped out, meaning it lost its “unicorn” status (a unicorn is a company valued at more than $1 billion).

The sudden drop in its value came after Lyndon Rive said the company would have to focus on cutting costs, as its rapid growth meant it had sunk a lot of money into infrastructure that wouldn’t make it any cash in the near future.

“The downside of growing at 80% or 90% is you have to make investments into the infrastructure today, but you only recognize the benefit of that investment two quarters to three quarters later,” Rive said.

Documents obtained by shareholder lawsuits revealed executives thought the company was facing a cash crisis as early as September 2015.

SolarCity announced Tesla had offered to buy it for $2.6 billion in August 2016.

elon musk
Tesla CEO Elon Musk.

SolarCity said in an official blog post on August 1, 2016, that Tesla had made an all-stock offer on June 21.

“Now is the right time to bring our two companies together: Tesla is getting ready to scale our Powerwall and Powerpack stationary storage products and SolarCity is getting ready to offer next-generation differentiated solar solutions,” SolarCity’s blog said.

The deal was approved by Tesla’s shareholders in November 2016. At the time of the acquisition, Elon Musk owned a 22% stake in SolarCity.

When Tesla bought SolarCity, it took on $3 billion in debt.

As Insider’s Matthew DeBord wrote at the time, SolarCity had $3.2 billion in debt when Tesla acquired it. Its market cap had also fallen by 50% in the year leading up to the acquisition.

Although Elon Musk argued in court this week he didn’t think SolarCity was “financially troubled” when Tesla acquired it, court documents unsealed in 2019 show Musk emailed former SolarCity finance chief Brad Buss, saying SolarCity would need to solve its “liquidity crisis” to win over investors.

A regulatory filing showed SolarCity had started 2016 with 15,273 staff but by the end of 2016, it had 12,243.

The Rive brothers left less than a year after the acquisition closed.

SolarCity cofounder Lyndon Rive standing by a Tesla Powerwall battery.
SolarCity cofounder Lyndon Rive standing by a Tesla Powerwall battery.

Lyndon Rive announced in May 2017 he would be leaving Tesla in June.

He told employees in a letter he was an “entrepreneur at heart,” and wanted to leave to build a new startup. Rive told Reuters at the time SolarCity was “healthier than it’s ever been.” 

Peter Rive, Lyndon’s co-founder and CTO, left the company in July 2017. In an internal letter published by Green Tech Media, Rive said he had decided to “take a break and focus on some other projects.”

“I plan to spend more time exploring the outdoors, more time with my family, and helping non-profit solar projects in the developing world,” Rive added.

In 2018, Tesla Energy had to deal with a major PR crisis when Tesla solar panels on top of seven Walmarts caught fire.

Walmart filed a lawsuit against Tesla in August 2019 claiming the fires were the result of “widespread negligence” on Tesla’s part.

After Walmart filed the case Amazon came forward to say solar panels on top of its Redlands, California warehouse had caught fire in June 2018. The retail giant said it would not be installing any more solar panels.

Walmart dropped the lawsuit three months later after reaching an out-of-court settlement with Tesla, a Walmart spokesperson said. The details of the settlement were not disclosed.

In August 2019 Insider’s Linette Lopez reported Tesla had rolled out a stealth replacement program for faulty solar panels in summer 2018, codenamed “Project Titan.”

Since SolarCity became Tesla Energy it’s brought out two big flagship products: the Powerwall and the Solar Roof.

tesla solar roof
A Tesla Solar Roof.

While Tesla Energy has continued to sell the traditional solar panels SolarCity used to install — which are made by third-party manufacturers such as Trina Solar — it has brought two new products to market since the acquisition.

The first was its Powerwall storage battery, designed to store energy generated by a customer’s solar system so even if the power goes down in their neighbourhood they’ll have access to power.

It’s not entirely clear whether development on the Powerwall began before or after the acquisition. Tesla gave a preview of the storage battery at an event in May 2015, but in testimony on Tuesday Musk said development of the Powerwall was “beginning” when the acquisition happened in 2016.

“We were beginning development of the Tesla Powerwall battery. And in order to have a compelling product, you really needed to have a tightly integrated solar and battery solution. And we could not create a well-integrated product if SolarCity was a separate company,” Musk told the court.

The second is the Solar Roof, which instead of bolting panels on top of a customer’s roof replaces the entire roof with photovoltaic shingles.

Musk debuted the Solar Roof in October 2016 during a glitzy event on a house from the show “Desperate Housewives.”

“It needs to be beautiful, affordable and seamlessly integrated,” Musk said at the unveiling event, adding: “You’ll want to call your neighbors over and say, ‘check out this sweet roof.'”

Depositions from Tesla executives later revealed the tiles Musk had shown off at the event hadn’t been operational.

Tesla did not start actually installing Solar Roof until 2019. In a deposition, Musk said this was because Tesla had to divert resources away from Tesla Energy to focus on the Model 3 production ramp.

Tesla raised the price of the Solar Roof in April 2021. Musk said this was because the company had made “significant mistakes.”

Customers who had already signed contracts for a Solar Roof but had not yet had one installed reported in April the company had jacked up the prices on their roofs. One customer who had his contract raised from $71,000 to $146,000 filed a class-action lawsuit against Tesla.

Musk addressed the price hike in Tesla’s 2021 Q1 earnings call, saying “we did find that we basically made some significant mistakes in assessment of difficulty of certain roofs.” 

Musk said roof complexity made it hard to price them accurately. “If a roof has a lot of protuberances, or if the roof — sort of the core structure of the roof is rotted out or is not strong enough to hold the Solar Roof, then the cost can be double, sometimes three times what our initial quotes were,” he said.

Tesla also made buying a Powerwall a compulsory package deal when buying a solar system in April.

GettyImages 967233432
Three Tesla Powerwall batteries.

Elon Musk announced the policy change via a tweet. “Solar power will feed exclusively to Powerwall. Powerwall will interface only between utility meter & house main breaker panel, enabling super simple install & seamless whole house backup during utility dropouts,” Musk said.

The tweet appeared to be in response to a customer who complained on Twitter their system hadn’t generated a “single watt-hour.” 

Tesla Energy has fallen behind competitors since SolarCity’s heyday. Musk blames the Model 3, the pandemic, and the global chip shortage.

GettyImages 1229892852
Elon Musk.

While SolarCity was once number one in the US for residential solar installs, in Q1 of 2019 it slipped to number three below rivals Sunrun and Vivint Solar. Sunrun acquired Vivint in October 2020, consolidating its market share.

During his testimony before the Delaware Court of Chancery on July 12, Musk said Tesla Energy’s progress was hampered by the notoriously difficult production ramp on the Model 3 car. Musk said in his testimony and in depositions the company had to pour all its resources into getting the Model 3 to market — meaning its energy operation suffered.

After that, Musk said, the company ran “headlong into a pandemic.”

Musk continued his testimony on July 13, and added the global semiconductor chip shortage had impacted production of the Powerwall. He said while demand was around 80,000 units, the company would only be able to make a maximum of 35,000 in the next quarter.

Do you work at Tesla Energy or are you a Tesla Energy customer? Contact this reporter at ihamilton@insider.com or iahamilton@protonmail.com. If you are an employee always use a non-work email.

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A couple says their Tesla Solar panels caused relentless leaks that led to mold 10 times the healthy limit, $115,000 in damages, and a long-running legal battle

Elon Musk watching water leak out of a Tesla solar panel roof on a purple background.
When their solar panels caused leaks, Jamie Fedorko and Sabrina Ferrer say they had a nightmare experience with Tesla.

  • Married couple Jamie Fedorko and Sabrina Ferrer bought a house in 2019 that had Tesla Solar panels installed.
  • Since then, their roof has sprung multiple leaks, and their house developed a mold infestation.
  • The couple have filed for arbitration to end their contract with Tesla, the only way to potentially end their lease. Tesla has denied the allegations in the arbitration.
  • See more stories on Insider’s business page.

On Christmas Day 2020, married couple Jamie Fedorko and Sabrina Ferrer woke up to water trickling into their house in Hudson Valley, New York. Overnight, a rainstorm had melted snow drifts on their roof, and water was seeping into a guest bedroom.

They weren’t surprised. They’d been dealing with recurring leaks for almost a year, and had spent that year running after the company they believed was the root of the problem – Tesla. Elon Musk’s Tesla is best known for its electric cars but it also has a solar energy division, called Tesla Energy, which had installed solar panels on the roof before the couple bought the house.

“My heart sank,” Ferrer told Insider, describing the moment she noticed the leak. “I knew that we’d have to spend the entire day on the phone with Tesla trying to convince someone to come out on a holiday.” The couple discovered another seven leaks that Christmas Day, she said.

The couple say they have now faced 18 months of recurring, damaging leaks, a severe mold infestation that forced them out of their home for three months, and an ongoing dispute with Tesla over how much money Tesla will pay for repairs.

The couple are fed up, they told Insider. They want to ditch the panels – which they believe have caused multiple leaks – and kill their solar-panel contract. But they feel as if they’re effectively trapped in a lease that Tesla won’t let them easily escape, they said.

In April, the couple filed a petition for arbitration, which is the only way for them to get out of their contract, per their lease agreement. In arbitration, two parties agree to resolve their dispute outside of court, usually through an official arbitrator.

The petition asked that the company end the lease and cover an alleged $115,000 in damages. Tesla made a settlement offer of $33,000 compensation in February, as confirmed by a document viewed by Insider. Fedorko said the couple rejected the offer because they wanted the $115,000 they believe they’re owed, and because they wanted a settlement that ended their lease.

The couple first submitted their petition in April, followed by an amended version in May. Tesla responded on June 18, on the final day of a 20-day deadline following the May filing. Insider viewed Tesla’s response, which contained broad denials of the allegations in the petition.

Arbitration responses typically include these, but the couple’s lawyer Tom Mullaney told Insider he was hoping for more.

“Tesla’s answer contains all it is required to give, and no more,” Mullaney said in an email. “I was not surprised to see it, but I was hoping for substantially more from a self-styled, socially conscious company whose customers are suffering from significant damage to their physical environment caused by its products,” he said.

Fedorko said his immediate reaction to Tesla’s response was that he remained “baffled.”

“Wouldn’t it be easier if instead of doing what we’re doing, Tesla simply worked directly with their paying customers whose lives have been upended by Tesla itself?”

Tesla did not respond to repeated requests for comment from Insider.

While Fedorko and Ferrer’s experience is extreme, they aren’t alone in their frustration with Tesla Energy. In recent interviews with Insider, several Tesla Energy system owners described what they saw as shockingly unresponsive customer service, even after contacting the company to resolve serious issues, such as leaks.

Fedorko’s panels, which were removed seven months ago so the roof could be fixed, are now lying in the couple’s backyard.

Tesla Solar panels lying in Jamie Fedorko's backyard.
Tesla Solar panels lying in Jamie Fedorko’s backyard.

The leaks began seven months after the couple moved in

Fedorko and Ferrer bought their Hudson Valley house – the first house they’d ever owned – in June 2019 for $570,000. To close the deal, they had to assume the lease of the Tesla Solar panels sitting on the house’s roof, Fedorko said.

The couple first discovered a leak in their house in January 2020, he said. Water was seeping into the kitchen, and when Fedorko climbed into the attic he realized the solar panels would have to be removed to properly inspect the roof, he said.

According to a “site visit agreement” viewed by Insider, Tesla charges $200 to send a crew out to investigate problems with solar panels. If the crew then discovers the panels have caused the damage, the fee is waived. Tesla also limits the company’s liability for “direct damages” to $500.

Tesla told Fedorko the earliest it could send a crew was four to six weeks, he said. Unhappy with the idea of six weeks’ worth of water leaking into his kitchen, Fedorko hired local contractors to take the panels off and reseal the roof.

Read more: We visited a futuristic microfactory for Arrival, the $11 billion electric van maker ripping up the Tesla playbook

Once the contractors had resealed the roof in January 2020, everything seemed fine for four weeks – and then two leaks appeared: one in the same spot, and another in a different part of the kitchen, Fedorko said. This time, Tesla sent out a crew of two within two days: one person to fix the roof and another to patch up drywall that had cracked due to the leak, he said.

Fedorko said Tesla reimbursed the fee for the visit, and Insider viewed a correspondence in which a Tesla representative agreed the company would cover an invoice for $480 related to repairing damage caused by the January leaks.

The house sprung leaks three more times in the spring and summer, and then again on Christmas Day, Fedorko said. In an email dated January 15 of this year and viewed by Insider, a Tesla executive resolutions specialist, a kind of dedicated customer service rep, detailed the apparent causes for leaks that occurred in February, July, and December 2020 – all of them to do with the solar panels.

Tesla CEO Elon Musk with a hardhat.JPG
Tesla CEO Elon Musk.

Fedorko said he was so exasperated by the spring and summer leaks that in August 2020 he asked Tesla about removing the system and killing the contract.

Tesla said there was no out-clause, and that he’d have to take the company to arbitration.

This isn’t unusual for solar-panel companies. Lease contracts for solar panels often come with arbitration clauses rather than simple out-clauses. “Most solar lease contracts are difficult to cancel without legal action,” Nick Liberati, communications manager for solar panel comparison site Energy Sage, told Insider.

Exhausted, the couple let the matter rest. “We just said, all right, whatever. Let’s hope that this last fix worked and we’ll let it go,” Fedorko said.

Mold problems

In October 2020, the weather cooled, and the couple turned on the heating more regularly. As they did so, an unpleasant smell began permeating the house, they told Insider.

A month later, Fedorko paid for an H-VAC company to come and inspect the heating system. The company found water had breached the heating ducts, leading to a mold infestation. The heating appeared to be blowing spores around the house, causing the smell, Fedorko said.

Insider viewed a report ordered by the couple’s homeowner insurance company, in which an inspector gave his opinion that “water intrusion” through the roof was the source of the mold. Insider also viewed a January bill from a local H-VAC company that said the system had been compromised by “water incursion.”

In January, the couple got an independent assessor to determine whether the mold posed a health risk. According to that assessor’s report, as viewed by Insider, the mold levels in the attic were 100 times higher than the level considered safe for human habitation. In the rest of the house, they were 10 times higher than the recommended safe level, per the report. This was especially alarming for Fedorko, because he suffers from asthma.

Tela solar panels on top of a hospital roof in San Juan, Puerto Rico.
Tesla solar panels on top of a hospital roof in San Juan, Puerto Rico.

The couple moved out immediately, temporarily staying with an elderly uncle while they looked for a place to rent, Fedorko said.

Work on the mold didn’t start until February because the couple tried to get Tesla to cover the costs of the work before it started, but could not convince the company to do so. The company made its offer of $33,000, but that didn’t cover the full costs of the mold remediation.

Eventually, they decided they could wait no longer.

To get rid of the mold, the couple had to replace the roof shingles and the decking, which had become infested. Next, they had to have their HVAC system repaired, and finally pay for mold remediation throughout the whole house.

“This was by far the most costly, time consuming portion of the repairs,” Fedorko said. The mold removers had to go through the entire house deploying purification machines and scrubbing rooms by hand. A bill viewed by Insider showed the mold remediation alone cost $41,900.

The couple said they had to stay out of the home for three months.

Although Tesla offered to pay for many of the leaks – most explicitly, via its $33,000 compensation offer – it denied that the leaks led to the mold infestation.

Fedorko sent the reports he’d gathered on the mold to Tesla, which then sent out an engineer and an adjuster. The adjuster told Fedorko that the mold wasn’t caused by the roof leaks – it was the dryer venting into the house’s attic space, Fedorko said.

A letter from a heating company later contracted by Fedorko said that this was not the case.

“We found that the dryer was already venting to the exterior of the home and was not venting into the attic. An old pipe which is no longer in use and had already been corrected may have led someone to incorrectly believe otherwise,” the letter said.

Once Tesla’s Solar panels came off, they could see the extent of the damage

The panels have been off the roof since December 30, 2020, when Tesla sent out a crew to inspect the roof after the Christmas Day leaks.

“We agreed to remove the entire system to assess the condition of the roof, which we’d never done before,” Fedorko said.

“Once the panels were off, it was staggering. The roof had soft spots, replacement shingles, it was not in good shape and the foreman said right to my face that the roof clearly wasn’t in solid condition to begin with.”

In a January 2021 report, an independent inspector hired by Fedorko said there were pre-existing problems with the roof, and that the panels shouldn’t have been installed until the roof had been replaced. The report also said the way the panels were installed would have contributed to “seepage.”

The couple told Tesla to leave the system off until the roof was fixed, and are determined not to put them back on, they said. They have since paid to replace the roof, and continue to pursue Tesla for reimbursement of their expenses and an end to their lease.

In an email viewed by Insider, the couple’s executive resolutions specialist said billing had been paused, but not lifted. There was a “high probability” the couple wouldn’t be reported to a credit bureau, the specialist said.

“The house is fine now,” Fedorko said. “It’s not raining in my living room every time it rains, so that’s helpful. But I’ve worked really hard to make back what we’ve lost.

“We just feel sort of stupid about the whole thing, in the last year and a half, people are suffering so immensely […] but the emotional, personal toll has been no joke,” he added.

Now, 11 months after they first asked Tesla about ending the contract, the couple is awaiting a schedule for the arbitration process. Meanwhile, the panels are still lying dormant in their backyard.

“We couldn’t sell our home if we wanted to.”

Do you work at Tesla Energy or are you a Tesla Energy customer? Contact this reporter at ihamilton@insider.com or iahamilton@protonmail.com. Always use a non-work email.

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Elon Musk says Tesla will only sell solar panels together with its Powerwall storage battery from next week

elon musk
Tesla CEO Elon Musk.

  • Elon Musk said Tesla will now only sell its solar panel products together with its Powerwall storage battery.
  • Musk had a Twitter exchange with a solar panel customer who said their panels haven’t generated a “single watt-hour” since January.
  • Musk said in January the company was working on integrating Powerwall with its solar products.
  • See more stories on Insider’s business page.

Tesla CEO Elon Musk is going to shake up the way the company sells its solar panels.

In a tweet late on Wednesday, Musk said from next week, all sales of the company’s solar energy products will come together with its energy storage battery Powerwall.

“Solar power will feed exclusively to Powerwall. Powerwall will interface only between utility meter & house main breaker panel, enabling super simple install & seamless whole house backup during utility dropouts,” he said in a followup tweet.

Bloomberg reported this followed a complaint from Brett Winton, Director of Research at Ark Investment Management that his Tesla solar panels haven’t generated a “single watt-hour” since they were installed in January because he was waiting on his utility to approve the connection.

After Musk asked Winton if he had Powerwall he replied: “Hmm. Yes have powerwall. Everything right now is switched off; just awaiting LADWP [Los Angeles Department of Water and Power].”

Musk’s decision hasn’t come entirely out of the blue. He said during Tesla’s fourth-quarter earnings call in January that the company was focusing on integrating Powerwall with its solar division.

It also comes a week after numerous customers waiting for installations of Tesla’s Solar Roof product reported receiving new contracts increasing the price of installation by as much as 70%. It’s not yet clear whether including Powerwall in all sales of Tesla’s solar products will increase the price. Insider has emailed Tesla for clarification.

Are you a Tesla Solar Panel or Solar Roof customer? Contact this reporter at ihamilton@insider.com or iahamilton@protonmail.com.

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Honolulu-based energy storage company Blue Planet Energy hopes to bring sustainable, renewable power to Hawaii – and the world

Henk Rogers Hawaii Big Island Ranch Lab
Henk Rogers, founder of Blue Planet Energy.

  • Energy storage company Blue Planet Energy is focused on energy independence and sustainability.
  • It was founded in 2015 by Henk Rogers, who acquired the rights to Tetris in the 1980s.
  • It’s part of Hawaii’s climate change initiatives and hopes to make renewable energy more accessible.
  • This article is part of a series focused on American cities building a better tomorrow called “Advancing Cities.”

Residents and businesses in Hawaii pay more for energy than just about anywhere else in the country. Honolulu-based Blue Planet Energy is one organization that’s attempting to ease that energy burden.

Blue Planet Energy has created an energy storage system to encourage energy independence and broaden the use of renewable power. The company has about 25 employees and a network of more than 250 certified dealers that have installed thousands of its energy storage products.

“We want to decarbonize our energy system,” Chris Johnson, the company’s CEO, told Insider. “However, climate is changing. Storms are getting more intense and knocking out the grids, and so that’s where we need to deal with it.”

2   Chris Johnson
Chris Johnson, CEO of Blue Planet Energy.

Climate change conversations typically focus on mitigation and adaptation, he said, and the company aims to make the homes and businesses that use renewable energy, such as solar panels, more resilient.

Since 2013, Honolulu has ranked first in solar power per capita among the country’s 50 largest cities and third in the amount of existing photovoltaic solar power, which generates electricity directly from sunlight, installed as of 2020, according to a report by the Environment America Research & Policy Center and the Frontier Group.

“With renewable energy, you can’t control when the sun shines or when the wind blows,” Johnson said. “But we need steady, reliable energy for our homes, for our businesses, for our critical infrastructure, and so we create energy storage solutions that allow the energy to be consumed when you need it. And they’re also resilient, so even if the grid goes down, you can still stay up and running.”

Blue Planet Energy Bamboo Living Big Island Hawaii
Blue Planet Energy solar panels on a home on the Big Island in Hawaii.

Here’s a look at how Blue Planet Energy’s renewable energy systems work, and how the company’s mission aligns with Honolulu’s sustainability goals.

The Blue Planet name has influenced climate change policy in Hawaii

Blue Planet Energy was founded in 2015 by Henk Rogers, who discovered and acquired the rights to the video game Tetris in the 1980s. More recently, he’s been committed to expanding clean energy and reducing and ultimately eliminating dependence on fossil fuel.

Henk Rogers Founder Blue Planet Energy 2
Henk Rogers, founder of Blue Planet Energy.

Rogers also founded the Blue Planet Foundation, a nonprofit working to solve climate change by leading the way in the transition to 100% clean energy. The organization has been influential in clean-energy policy adoption in Hawaii and Honolulu, including a bill requiring the state’s utilities to generate 100% of their electricity from renewable energy, which Hawaii Gov. David Ige signed into law in 2015. Hawaii was the first state to have such a law.

Blue Planet Energy’s energy storage systems are an extension of Rogers’ vision. While the company was founded in Honolulu and has a strong footprint in Hawaii, Johnson said it now has installations in more than 30 states, Puerto Rico, and several Caribbean islands, and is growing its presence in Mexico, Central America, and Canada.

Blue Planet Energy Violeta Reyes Perez School Puerto Rico 2
Violeta Reyes Perez School in Puerto Rico.

“Henk, our founder, really thought that if we can achieve this in Hawaii, we could take that as a model to other places,” Johnson said. “It’s essentially a learning laboratory for sustainability.”

Energy storage solutions offer homes and businesses more resilient power sources

In March 2021, Blue Planet Energy launched a new product, the Blue Ion HI. The new energy storage system joins the company’s Blue Ion LX.

“Those are basically similar in approach and functionality but designed for slightly different situations,” Johnson said. “The LX is for larger installations, including commercial and industrial or community resilient infrastructure. Our HI offering is residential and small commercial.”

The Blue Ion LX accommodates on- or off-grid requirements for facilities like warehouses, corporate headquarters, and manufacturers. The battery stores excess solar energy or adjusts to traditional energy sources to avoid power interruptions, and increases the value of a company’s investment in renewable energy.

Blue Planet Energy Blue Ion LX Brick Warehouse
Blue Ion LX by Blue Planet Energy.

The Blue Ion HI is a solution for homes and businesses. It captures energy from renewable and traditional sources, easily switches from grid to battery power, and provides on-demand energy. The products are also stackable and can be configured in different ways to suit the needs of the property.

Blue Planet Energy Blue Ion HI Stacked
Blue Ion HI by Blue Planet Energy.

Henk, Johnson said, “likes things to be able to fit together nicely,” so they made the batteries stackable and easily scalable.

Blue Planet Energy’s customers mainly use its batteries to store excess solar energy, either displacing their use of a grid or a generator, Johnson said. This is a valuable service as energy bills continue to rise and natural disasters impact power grids.

Hawaii has some of the highest energy costs in the nation, according to the US Energy Information Administration. It’s also vulnerable to hurricanes, flooding, and tsunamis, causing a loss of electricity. The cost of power is also going up across the country, where natural disasters also knock out power. For instance, Texas saw massive power outages after a major snowstorm and unusually cold temperatures hit in February.

“We need to have resilient infrastructure so we can bounce back quickly,” Johnson said. “If we put a lot of renewables out there without balancing it out with energy storage, the grid could be unstable or not available when you need it, and so we’re part of making sure that the grid can absorb a lot of renewables, it can recover and always be on.”

Expansion plans aim to make renewable energy more affordable and accessible

Helping to create more resilient and affordable energy systems aligns with the initiatives of Honolulu’s Office of Climate Change, Sustainability and Resiliency, Johnson said. Blue Planet Energy has worked with the office on developing renewable energy and resilience best practices, and the company plans to continue this work with the city’s new administration under Mayor Rick Blangiardi, which just took over in January.

To further address affordability, Johnson said the company recently launched a new financing product to make its energy storage systems more accessible to commercial customers. It doesn’t require a down payment and offers instant energy savings on solar power and Blue Ion storage installation.

The cost of Blue Planet Energy’s installations vary depending on a property’s energy needs and can range from tens of thousands of dollars to hundreds of thousands for large buildings with extensive power needs, according to the company. Energy storage installation costs roughly the same as solar installation.

The average cost for solar panel installation in the US varies by state, but averages $17,760 to $23,828 after the federal solar tax credit, which lowers the cost by 26%, according to EnergySage. Some states and local governments also offer rebates and tax credits for solar systems.

Blue Planet Energy Life Edited Maui Hawaii 1
Blue Planet Energy in Maui, Hawaii.

Blue Planet Energy is in a period of “scaling and acceleration,” Johnson said. Over the next decade, the company plans to expand and strives to alleviate the effects of climate change, which are expected to worsen.

“This is really crunch time,” he said. “How do we deliver the highest-quality, most reliable, safest solution at scale as fast as we can? Get it out on the ground, into homes, businesses, and critical infrastructure so that we can stabilize the grid and we can stabilize our climate.”

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How Honolulu, Hawaii is working toward sustainability and supporting its residents in the process

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Solar panels on top of homes in a Honolulu neighborhood.

  • Honolulu has been focused on sustainability and climate change since receiving a grant in 2016.
  • Its resilience plan has promoted access to renewable energy and expanded clean transportation.
  • Other initiatives include reducing energy bills and addressing hunger by supporting local farmers.
  • This article is part of a series focused on American cities building a better tomorrow called “Advancing Cities.”

In his first state-of-the-city speech in mid-March, Rick Blangiardi, mayor of Honolulu, Hawaii, emphasized the city’s commitment to “climate resilience.”

“From sea level rise, rain bombs, and increasing temperatures, we’re taking steps toward a climate-ready Oahu,” said the mayor, who was sworn in at the start of 2021. The island of Oahu is home to the city and county of Honolulu.

“We’re shifting from talking about policy to doing something about it,” Blangiardi added.

Sustainability and climate change are issues that Honolulu’s leaders have been working to address for years. In 2016, the city was awarded a 100 Resilient Cities Initiative Grant from the Rockefeller Foundation to help fund the hiring of a chief resilience officer to work with the city on crafting climate change and resilience plans.

Since then, Honolulu has debuted a Resilience Strategy and a Climate Action Plan, which have helped inspire citywide legislation to reduce the energy burden on residents, promote access to renewable energy, expand clean transportation, and support locally grown food producers.

Here’s a look at some of Honolulu’s sustainability initiatives.

Codifying the Resilience Office’s responsibilities will help Honolulu meet its sustainability goals

Oʻahu Resilience Strategy Steering Committee members meeting during development phase of the strategy, which includes Honolulu Mayor Rick Blangiardi.
Oahu Resilience Strategy Steering Committee members meeting during the development phase of the strategy, which includes Honolulu Mayor Rick Blangiardi.

The Office of Climate Change, Sustainability and Resiliency was created by a city charter amendment that was approved by the public in 2016. A new bill signed into law in December 2020 “codifies the duties, responsibilities, and reporting requirements” of the office to ensure Honolulu meets its climate change and sustainability goals. 

Bill 65 establishes an energy benchmarking system, requiring Honolulu to create and report energy and water use benchmarks for city-owned buildings. The rule is estimated to save the city $7 million over the next decade. The bill also specifies that the city will transition to 100% renewable energy and become carbon neutral by 2045.  

It also addresses many other climate change and sustainability measures, including a One Water policy, examining efficiencies across the city’s water system. 

The Resilience Strategy addresses affordability and climate change

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The Resilience Office engaging community members on their perspectives of “Resilience.”

One of the central initiatives of the Resilience Office is the Oahu Resilience Strategy, which aims to address “long-term affordability and the impacts of a climate crisis that is already driving islanders from their homes,” according to the office’s website. 

Planning began in 2017 when the office met with Oahu’s 33 neighborhood boards to survey residents about what concerned them most about climate change and how they thought it could be addressed, Matthew Gonser, chief resilience officer and executive director of Honolulu’s Office of Climate Change, Sustainability and Resiliency, told Insider. 

Hundreds of ideas were gathered from the community. Those concepts were narrowed down into 44 actions, comprising the Resilience Strategy. The strategy focuses on four broad subjects: long-term affordability, natural disaster preparedness and response, climate change, and local community leadership. 

By the end of 2020, significant progress had been made on about half of the 44 resilience actions, Gonser said.

The Climate Action Plan outlines what’s needed to address climate change long term

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The City and County of Honolulu Climate Action Plan open house community engagement session with Hawaii Pacific University and the Chamber of Commerce Hawaii.

Honolulu’s Resilience Office released the city’s Climate Action Plan in December 2020.

The plan was developed based on scientific evidence and community input to fight climate change and reduce fossil fuel emissions on Oahu. It spells out the needed programs, policies, and actions for the city to become carbon neutral by 2045 — and includes nine strategies to focus on over the next five years, including increasing renewable energy and energy efficiency. 

To develop the Climate Action Plan, community meetings with Honolulu City Council members, Hawaii Pacific University, the University of Hawaii at Mānoa, and the Chamber of Commerce of Hawaii were held, and working groups with stakeholders were set up, Gonser said. 

During the first few months of 2021, the public had the chance to share their opinions and concerns about the plan before it goes to the city council. Gonser said the Climate Action Plan will likely be adopted this year. 

Honolulu updated parking ordinances to promote walkability and the use of clean energy transportation

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Jeff Mikulina, executive director of Blue Planet, speaking at the signing of Ordinance 20-41, related to off-street parking and loading.

At the end of 2020, former mayor Kirk Caldwell signed Bill 2 to update Honolulu’s mandatory parking requirements for new developments. It gives developers more flexibility in how much parking to build and allows opportunities for the land to be used for other purposes, such as affordable housing. 

“It’s making sure that our rules and regulations don’t force overbuilding of parking, empowering more choice and leaving it to developers to determine what’s needed,” Gonser said. 

The bill supports walkable neighborhoods and cleaner transportation options, such as biking and public transportation, which Honolulu plans to transition to clean fuel. 

It could also make housing more affordable since constructing and maintaining parking is sometimes a hidden cost for renters, according to an analysis by the Ulupono Initiative, a Honolulu-based organization that provides grants, investments, and advocacy to support renewable energy, locally produced food, and other sustainability-minded projects.

For urban Honolulu renters, up to 37% of their rent may go toward parking, which, for decades, has often been built based on city regulation rather than actual need.   

“The bill makes progress in the right direction, better aligning with city climate and community goals, while allowing parking to remain accessible for those who genuinely need it and not requiring it of those who don’t,” Kathleen Rooney, Ulupono Initiative’s director of transportation policy and programs, said when the bill was signed

Making solar power more accessible eases Honolulu’s energy burden

Solar array installation on top of the Board of Water Supply, City and County of Honolulu
Solar array installation on top of the Board of Water Supply.

Hawaii has one of the highest average electricity retail prices in the country, according to the US Energy Information Administration, and the state relies on petroleum for most of its electricity generation. 

Reducing the energy burden is a key focus area of Honolulu’s Resilience Office. In December, the city enacted Bill 58 to streamline the permitting process for residential clean energy products, such as solar power, energy storage, and electric vehicle chargers. The goal is to cut down on the costs and time it takes to install solar systems. 

Creating more equitable access to renewable energy is an important component in making Honolulu an affordable place to live, Gonser said. 

“We have one of the highest energy burdens in the nation,” he said. “It’s updating our energy code and making sure that all new things that are being built are ensuring long-term affordability for residents and that they can benefit from progressive infrastructure so that we can reduce the energy burden over time.”

New performance-based regulations could lower energy bills for residents

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A timeline of the Hawaiian Public Utilities Commission.

As another initiative aimed at reducing energy bills, Hawaii’s Public Utilities Commission approved a new Performance-Based Regulation Framework in late 2020. The framework would transform utility company Hawaiian Electric by making its operations more efficient, lowering electricity rates, improving services, and meeting the state’s clean energy goals. 

“That’s really groundbreaking,” Amy Hennessy, senior vice president of communications and external affairs at Ulupono Initiative, which provided research and other information to guide the framework’s adoption, told Insider. “The impacts toward changing the incentives for our utility to transform into a renewable energy future are significant.” 

The new structure provides financial incentives for the electric company to meet certain goals, like creating savings for lower-income customers and reducing greenhouse gases. It also separates the utility’s profits from capital investments, creating a cost-of-service approach. 

Matching grant provides $1 million to fight hunger and support local food producers

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The Hawaii Farm Bureau.

Hunger has been an ongoing problem for many communities, but the pandemic worsened the situation, as unemployment increased and many families have faced new financial struggles. 

To address hunger in Hawaii, Gov. David Ige announced in October 2020 that the state would provide a $500,000 matching donation to the DA BUX Double Up Food Bucks program, which doubles the amount of the Supplemental Nutrition Assistance Program (SNAP) benefits, formerly known as food stamps, that are spent on locally grown food. 

Several private-sector organizations raised $500,000 for the program, including the Stupski Foundation and Ulupono Initiative, which each provided $200,000. The state match offers $1 million total for the program. 

Addressing hunger and providing incentives to encourage residents to buy more locally grown and produced food are part of Honolulu’s Resilience Strategy. The DA BUX Double Up Food Bucks program also aims to strengthen the local economy because it keeps residents’ food budgets on the island.

“A million dollars going out into communities for not just those who need access to food, but also our local farmers who needed a market — it’s actually putting dollars in their pockets while they’re growing to help provide healthy options for the community,” Hennessy said. “So it’s really a triple win.”

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