ON HAWAII ISLAND, THE LARGEST IN THE ALOHA STATE, WE have a unique story in the world of electric generation, a story I believe will become valuable to many across the country.

Our utility, Hawaii Electric Light, is leading the way to a clean energy future. Over 30 percent of the electricity we provide comes from renewable resources. We use a broad mix of clean energy sources, including geothermal power, wind power, run-of-the-river hydro, and numerous grid-connected customer-sited photovoltaic systems. We expect nearly 40 percent from renewable resources by the end of next year.

PV systems are becoming increasingly popular. Hawaii Island now has approximately 750 PV arrays with a total maximum generating capacity of about 11 megawatts, compared with our average day peak of 160 megawatts. Many of these systems make use of net energy metering. A newly approved feed-in tariff will also be available soon to customers with PV.

We consider managing this diverse mix of technologies one of our greatest successes. I am proud of everyone who works for our company, but I have a special regard for system operators who daily manage a unique combination of firm conventional generation, firm renewable generation, intermittent utility-scale renewables and a growing level of distributed generation. When we talk to specialists around the world about integrating more renewable energy onto grids, they defer to our system operators as the true hands-on experts.

To help us integrate all these sources of energy, we currently require an interconnection study when distributed generation of any kind reaches 15 percent of the peak load on a specific circuit - as in California - before additional DG can be added. This trigger is designed to protect the reliability of service to all our customers.

Moving forward we are working to accommodate more renewable energy, including distributed photovoltaic. The Hawaiian Electric companies are engaged with PV vendors, state and federal agencies, and others in a reliability standards working group. The group will attempt to analyze, in greater detail than ever before, the physical effects that solar, wind, and other variable generation sources have on our grid, and to develop ways to mitigate and control adverse impacts so that more renewable energy can be reliably integrated into the system. We are also trying to improve wind prediction techniques so that with clearer notice of changes in wind farm output, we can better manage other forms of renewable energy on the grid.

Why is all of this so important? Hawaii, composed of seven major islands, is the most oil-dependent state in the nation. Approximately 95 percent of all energy for transportation and electricity is dependent on imported petroleum. Every island grid stands alone, with no interconnections to one another, much less to the U.S. mainland.

Heavy dependence on imported oil poses energy security, economic and environmental challenges to our state. The Hawaii Electric subsidiary companies, including Hawaii Electric Light, are committed to meeting our state's aggressive goals, which call for 40 percent of electricity coming from clean sources.

We know there is still much work to be done, so we are pursuing potential engineering solutions, including better grid surveillance, advanced load controls, and energy storage systems. The Hawaiian Electric companies are engaged in a number of smart grid studies to find ways to integrate more DG on our grids. The Department of Energy and the different national laboratories are spending significant time and energy here. There are a number of initiatives getting started and they hold great promise.

Eventually, a top-to-bottom smart grid should help us increase renewable energy on our grids. The deployment of an advanced smart grid will be neither quick nor cheap: the 20-year timeframe of 2010-2030 for our state's clean energy goals recognizes the difficulty of this and related energy challenges. In the meantime, we have to depend on our smart people. Fortunately, along with geothermal, wind and sun, we have an abundant supply of those as well.

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