Demand for rooftop solar systems is growing again despite last year’s reduction in incentives.

Applications for “self-supply” rooftop systems, the only solar program currently authorized by Hawaiian Electric Co., reached 322 as of mid-November, up from near zero six months ago.

“Self-supply” prohibits owners from sending excess solar to the grid for credit, but allows residents to draw power from the grid. Most self-supply systems include a battery to store power during daylight hours and use at night or in cloudy conditions.

“We expect it will continue to grow,” Darren Pai, HECO spokesman, said Wednesday. “This is still a relatively young program that customers are becoming more aware of.”

Self-supply has been an option for residents since the state Public Utilities Commission created it October 2015.

Self-supply replaced the popular “net energy metering” solar program that paid residents the full retail rate for excess electricity sent into the grid. But that program and another watered-down version of it, known as grid supply, are no longer available.

The solar industry has been struggling since the end of those programs. In October, the solar industry reported a 40 percent loss in jobs, a nearly 30 percent drop in building permits and at least one company shutting down.

Despite the increase in self-supply applications, some in the energy industry say it is too early to tell whether the new program can help the solar sector bounce back.

Self-supply applications are a tiny fraction of the number of systems installed at the peak of net energy metering. In October 2012, more than 2,400 rooftop solar systems were approved in Hawaii.

State Public Utilities Commission Chairman Randy Iwase said he is encouraged by the growing interest in self-supply but that it is too early to tell whether it will lead to a dramatic change for the solar industry.

“We believe that among the tools needed to achieve our renewable energy goals … taking into account the limitations of grid in Hawaii, that a battery storage is an important component in efforts to encourage continued renewables with PV (photovoltaic),” he said.

Marco Mangelsdorf, president of Provision Solar, said the volume has to increase dramatically to help the industry get back to booming.

“(Self-supply) sales have to go way, way up for that to happen,” he said. “The transition from an export-based to self consumption-based model is underway in our Aloha State, and it’s going to take time for the latter to take off and gain momentum especially given the significant increase in cost due to the batteries being required.”

Self-supply was the least lucrative of the solar programs due to most homeowners needing to buy batteries, making the payback period longer than the other two options. Self-supply’s payback period is roughly seven to eight years compared to a four-year average for the net-energy-metering program that ended last year, according to RevoluSun.

“I haven’t noticed any turnaround as of yet,” said Will Giese, spokesman for the Hawaii Solar Energy Association. “There still seems to be difficulty arising from the permitting process for batteries, and there are no storage incentives.”

Despite 322 applications filed, only two self-supply systems have been installed, Giese said.

HECO and its sister companies — Maui Electric Co. and Hawaii Electric Light Co. on Hawaii island — said in early November they had received 234 applications for the self-supply program, up from 50 in early October. In May, there were six applications being reviewed.

There is a 35 percent state tax credit for solar, with a cap of $5,000, and a federal 30 percent tax credit. There is no state tax credit for batteries.

Some self-supply systems can start at $5,000 after tax credits, according to Hawaii Energy Connection. The systems cover roughly 30 percent of a home’s energy demand and customers can add batteries over the years to increase the system size. Before tax credits, the total upfront costs range from $14,000 for a system without batteries to upward of $35,000 for a system that includes batteries, according to Hawaii Energy Connection.

Iwase said that the focus can’t be on one industry or technology to reach the state’s goal of having 100 percent of its electricity generated from renewable energy sources by 2045.

“While the PVs continue to be important, it is not the only focus we have,” Iwase said. “We want to encourage diversity of renewable sources. … What we do with wind, what we do with hydropower, what we do with geothermal are important. The focus is not on one segment or one industry.”

Iwase said battery storage, a time-of-use program, community solar and energy efficiency are some of the initiatives that also need to be supported to reach the state’s goal.

“All of these are important,” Iwase said. “It’s not just the solar industry. It’s not one industry. It’s not one source.”