Clearway Energy’s talks with Hawaiian Electric to develop three solar farms came to a halt this month over concerns about the utility’s financial stability.

Clearway has proposed two solar fields with storage on Hawaiʻi Island that could produce a total of 115 megawatts of energy; this was more than half of the island’s average daily electricity demand. Another solar project planned for Oʻahu could produce enough electricity to power close to 20,000 homes.

Clearway said in a statement to HPR that the primary reason it withdrew its offers was “HECO’s financial distress and the change in HECO’s credit since the August 2023 fires.”

Many rating agencies after wildfire destroyed Lahaina on August 8 HECO’s credit rating downgraded reduced the utility to “junk” status, limiting its access to capital.

HECO spokesman Darren Pai said the organization was “disappointed” in not being able to reach an agreement with Clearway, adding that they were “open about the financial difficulties.”

The state’s Chief Energy Officer Mark Glick called the cancellation of the projects “a real blow” and said the “utility situation puts Hawaiʻi’s transit as a whole at risk.”

“While the global solution the Governor helped champion provides a viable path forward, it is critical that HECO takes immediate action to reassure Hawaiʻi residents and financial markets of its ability to recover from wildfire impacts,” Glick said. He added that the province is currently exploring “all options” to lower rates, ensure grid reliability and reduce carbon emissions.

The Hawaii State Office of Energy plans to release a report on progress in the state’s energy transition by the end of the year. The office is also investigating whether the state will do so. import more liquefied natural gas with the aim of achieving climate goals and reducing electricity costs.

Pai said the utility expects to meet its goal of generating 40 percent of its electricity from renewable sources “well before 2030,” the deadline set by state law. Negotiations continue to bring HECO 12 other renewable projects online Between 2026 and 2033.

Longroad Energy, which has two solar farms in the works, told HPR on Thursday that its projects are on track.

Ameresco executive Nicole Bulgarino said their company is working closely with HECO to ease concerns about the utility’s financial health and is “confident” about its plans to build both a solar-plus-storage project and a renewable fuel facility on Navy land in Pearl Harbor.

“Renewable energy projects face many challenges, including rising construction and material costs, supply chain issues and public opposition,” Pai said. “Historically, not every project is fully operational, so we maintain a diverse portfolio of renewable energy sources and a continuous pipeline of projects moving toward completion.”

Clearway currently operates four energy projects on Oʻahu: The island’s first solar plus storage facility. The developer said it hopes to work with HECO on future projects “once the utility’s financial situation is resolved.”