Solar energy is pouring into Oahu’s electrical grid at a blistering pace as more and more Hawaiian Electric Co. customers install photovoltaic systems to escape the high cost of petroleum-generated electricity.

The amount of solar generating capacity installed on HECO’s electrical grid doubled each year from 2009 through 2011, and nearly tripled so far this year.

During the first six months of 2012, 114 companies applied for more than 5,000 electrical permits for solar projects on Oahu, according to an analysis of city Department of Planning and Permitting data by ProVision Technologies, a solar installer. The top 15 companies on Oahu submitted permits for $159 million worth of photovoltaic projects, up from just $54 million during the same period in 2011.

"Ten years ago one could count the number of photovoltaic providers on the island on one, maybe two hands. Now, new entrants — both local and from the mainland — are popping up every month," said Marco Mangelsdorf, president of ProVision Technologies.

There has been one potential barrier to continued growth in solar installations in Hawaii: a HECO rule that can makes systems more expensive in areas where solar already accounts for 15 percent of peak electric usage. But even that may not be the having the negative effect solar proponents once feared.

The 15 percent rule has not yet been applied to residential customers on Oahu, HECO says. As for commercial customers, some have had to pay the added charge but say the cost has been small in comparison with the price of the total system.

Because the energy produced by solar panels is intermittent in nature, it raises concerns for HECO about the stability of electricity flowing through its grid. HECO says that’s why it adopted the 15 percent rule. In cases where peak demand on a given circuit or neighborhood exceeds 15 percent, HECO may order what is known as an "interconnection requirements study" to determine whether the customer needs to install additional hardware to ensure grid reliability.

HECO hasn’t required the study for residential customers because those systems are not that large. For businesses with large systems, the cost typically ranges from $30,000 to $50,000, not including any equipment upgrades that HECO may require.

HECO’s sister utilities in Hawaii and Maui counties have started charging residential customers for interconnection studies ranging from $500 to several thousand dollars in areas where photovoltaic exceeded the 15 percent threshold. One reason for the difference is those counties have a larger percentage of renewable energy — including solar and wind — feeding into the grid.

HECO residential customers installing photovoltaic systems up to 10 kilowatts in size — the bulk of the installations — are required only to obtain an electrical permit from the city and have a licensed electrical contractor certify that the system meets the necessary safety standards.

Homeowners on Oahu have complained of lengthy delays in getting the city Department of Planning and Permitting to inspect their photovoltaic systems once they are completed. DPP, which has been inundated with photovoltaic permit applications, must inspect and approve a completed project before HECO can sign off on it.

The story is similar on Maui, where county officials were forced to tighten the rules on inspections of photovoltaic systems because some installers were rushing projects through late in the year so customers would be eligible for state and federal tax credits.

Regardless of the problems with permitting and costly studies, solar is booming.

"The solar guys all have plenty of work. I challenge you to find a reputable solar installer on Maui who’s not fully booked months out," said Doug McLeod, Maui County energy commissioner.

Solar power is gaining traction in many states, but particularly so in Hawaii where the state’s abundant solar resources and nation’s highest electric rates combine to make the economics of photovoltaic attractive for many homeowners and businesses. The state offers a 35 percent tax credit on solar systems and the federal government offers a 30 percent credit. Photovoltaic capacity is expected to grow by a record 64 megawatts statewide this year.

When the owners of the Ba-Le bakery and sandwich shop chain decided to expand the business and move their production facilities into a massive Iwilei warehouse in 2009, they took a big financial risk. Then the first month’s electricity bill arrived, and it was for $30,000.

"We said now is a good time to think about getting some photovoltaic on the roof," said Trung Lam, son of Ba-Le founder Thanh Lam.

But it wasn’t as easy as calling a solar installer and ordering a photovoltaic system off the shelf. Because the system was going to be large, and the building was on a circuit that already had a high penetration of solar power, the project would require an extra level of scrutiny by HECO.

Working with Honolulu-based solar installer RevoluSun, the Lams decided to install two systems to take full advantage of the features offered under HECO’s net energy metering program, which is limited to 100 kilowatts. The Lams receive a credit for any unused solar energy at the retail rate, which is currently about 34 cents a kilowatt-hour. The second, larger system has 280 kilowatts of generating capacity and falls under HECO’s feed-in tariff program that pays 18.9 cents per kilowatt-hour.

The 100-kilowatt system provides electricity for the company’s La Tour Cafe, which is part of Ba-Le’s building that fronts Nim­itz Highway. The 280-kilowatt system powers the refrigerators, air conditioners and lighting for the company’s commercial bakery and offices. The photovoltaic panels for both systems sit side by side on the building’s rooftop, but are metered separately. Ba-Le powers its ovens with gas from HAWAI‘IGAS, formerly known as The Gas Co.

Trung Lam estimates his two solar systems will cut the company’s electric bill by 50 percent to 60 percent, which will enable Ba-Le to make its money back in less than five years.

Because the photovoltaic penetration on the Iwilei circuit was above 15 percent, HECO engineers performed a "supplemental review" at no charge to determine whether the Ba-Le project would require a more in-depth interconnection study. HECO said the study would be needed, and estimated the cost would run about $30,000, according to Trung Lam. Weighed against the $1.9 million cost of the photovoltaic system, the Lams decided to proceed.

The actual cost of the study turned out to be $35,000 and revealed that the Lams would have to pay an additional $10,000 for a transformer to help prevent the photovoltaic system’s power fluctuations from damaging the circuit.

"We were looking at it as investment," said Trung Lam. "An investment in cost savings that would save us more than if we took the money and placed it, say, in the stock market or in a bank. It’s like an investment, and the payback is really nice, especially with the tax credits."