Pv To Ev

New PUC Model Holds the Promise of Lower Rates

A new PUC regulatory framework will have repercussions for most of Hawaii’s electricity consumers, and in advancing the state’s transition to a 100% clean energy economy.

The new framework governing Hawaiian Electric’s operations establishes a rate-setting basis designed to incentivize the state’s largest electric utility’s transition off imported fossil fuels, beyond the state’s current 2045 and 100% clean energy mandate. Hawaiian Electric (HE) will soon find itself operating in the new regulatory world of a “Performance Regulatory Framework” (PBR).

According to a statement by Hawaii’s PUC, the new regulatory framework will transition Hawaiian Electric from a system wherein energy rates are determined by the cost of providing service to one which the company is rewarded for providing “exemplary performance” – in effect, a balanced approach between incentivizing and penalizing Hawaiian Electric based on the company’s performance and actions.

Performance-based ratemaking rewards utilities for performing well on key metrics, such as efficiency, customer service and greenhouse gas emissions reduction. PBR is a departure from the traditional utility model of reaping returns from capital-intensive investments (the cost-of-service model).

The PUC, in its governing role as the state regulatory body ensures HE’s performance and compliance in meeting state goals, and the utility’s ability to profit from its operations, but the PUC also foresees the new PBR model as an opportunity for HE customers and the utility to reduce customer electricity bills.

– Legacy and PBR Utility Operating Models –


Utility Puc Performance Model


PBR is new, but not unique to Hawaii

A total of 19 states and Washington D.C. have seen recent legislative and/or regulatory developments related to PBR. That’s six more than a year ago, according to new data on PBR activity by utility commissions and utilities compiled by regulatory intelligence firm EnerKnol and analyzed by Wood Mackenzie.

Yet analysis of regulatory and legislative activity shows that while PBR is becoming more widespread, linking new performance metrics with financial consequences for utilities remains rare. How well Hawaii’s largest electric utility does in this PBR environment remains to be seen.

According to EnerKnol research, … “Utilities increasingly view the programs as critical for locking in more stable revenues in the face of declining power sales and costly environmental mandates.”

Incentives are a key element of the PBR regulatory framework, but so far are mostly absent in most state-regulated PBR utility programs.  Performance mechanisms for PBR are divivded into three general categories,, according to Wood Mackenzie:

  • Metrics: Required reporting of quantifiable and verifiable metrics (greenhouse gas emissions, clean peaks, efficiency and customer satisfaction are typical examples)
  • Scorecards: When metrics are associated with targets and utility performance can be scored to compare to its historical levels or with peer utilities
  • Incentives: When scorecards are associated with financial incentives and/or penalties, giving performance mechanisms real enforcement power

Among the 11 states and territories with 100 percent renewable or carbon-free goals either signed into law or being acted upon in the state legislature, nine of them have recent PBR developments at the state or utility level: Colorado, District of Columbia, Hawaii, Illinois, Minnesota, New Mexico, Nevada, New York and Washington.

Ff Pollution

Hu Honua Meltdown

No amount of political influence is going to change the outcome for the Hu Honua Biomass project.

While there continues to be an effort to somehow rescue this ill-conceived power plant, the principals are already locked in litigation. Kind of a fitting end considering how many years they wasted in court as Ian Lind,  has exposed in his excellent coverage.

 Construction related litigation, suits against HELCO and NextEra, and even now they are trying to get their way using a writ of mandamus to the Hawaii Supreme Court and short cut the legal appeals process. The irony being that they want special expedited treatment because they are financially crumbling.

 Ian Lind, (Hawaii-based investigative reporter) recently exposed the curious case of certain elected officials attempting to bully the PUC into granting a waiver from the competitive process. Threatening to cut agency funding. This behavior was even brazenly put in writing which will likely attract attention from federal law enforcement tasked to prevent public corruption. Something that should bring immediate censure from their colleagues at the very least.

The PUC denied the waiver from competition because they found that Hu Honua wanted too much money for electricity and that it wasn’t in the public interest to raise rates for all consumers including State and County facilities on the Big Island as well as hard hit businesses and homeowners suffering through the pandemic economy. This at a time when solar farms have been approved and more are proposed at a fraction of the cost to ratepayers. Rates will actually go down for huge savings and creating lots of jobs in the process. Why would our elected officials jump on board an effort with this as the result?

 Finally, we really don’t need Hu Honua to get Hawaii island to 100% renewables. We don’t need an antique technology like burning trees to create energy that is hugely inefficient and represents the old central generation model with high transmission and distribution costs that get added on to our electric bills, when low cost and zero emissions wind and solar, and with Beyond Kona Banner Co2zero fuel costs, offer Hawaii clean and abundant self-sufficiency energy options.   With global heating on the rise, we certainly don’t need to be spewing greenhouse gases into the atmosphere when Hawaii has climate-compatible generation alternatives available for half the energy cost of Hu Honua.

 Governor Ige has already committed federal CARES Act funding toward workforce development and training to ensure that as we create the grid of the future that we are hiring locally. That is something we can all embrace. Help diversify our economy and recover from the impacts of the pandemic.

 We can also support a County ESPC or energy saving performance contract to save millions and reduce grid demand. Leverage this third party financing approach to build green infrastructure and create jobs without the need to float bonds.

Steve Holmes is the former Energy and Sustainability Coordinator for the City and County of Honolulu. He won the U.S. Department of Energy’s National Energy Champion Award in 2002.
He served 12 years on the Honolulu City Council putting large areas into parks and preservation.   He was a state energy analyst in Hilo, a Park Ranger at Hawaii Volcanoes National Park, Executive Director of Hawaii’s Thousand Friends, Hawaii Chapter Conservation Chair of the Sierra Club, President of Kokua Hilo Bay, and has won numerous awards for his efforts on behalf of Hawaii’s environment.
Beyond Kona Powerlines Solar Field

Big Island Electricity Prices Could Fall or Rise Dramatically

Donald Trump campaigned in 2016 pledging to save the coal industry. The problem is that coal and biomass have high unchangeable price points. Not so for solar energy.

The Levelized Cost of Energy (LCOE) is a term which describes the wholesale cost of the power produced by solar and sold to HELCO over a contract term. The wholesale cost is about 50-60 percent of the retail price that HELCO sells electricity to customers.

The Hawai`i Public Utilities Commission approved the HELCO-Hu Honua Power Purchase Agreement in December 2013. Hu Honua failed to meet contractual deadlines and HELCO canceled the contract.

The Commission approved the Amended and Revised HELCO- Hu Honua Power Purchase Agreement in July 2017.

The Consumer Advocate noted that the LCOE for the Hu Honua project in 2013 was consistent with other contracts: Hu Honua (25.3 cents/kWh), Kahuku Wind (22.5 cents/kWh), H-Power (22.4 cents/kWh), Interisland Wind (22.0 cents/kWh), and Kalaeloa Solar (21.8 cents/kWh)

The Public Utilities Commission described how the LCOE had changed between 2013 and 2017.

The LCOE for the Hu Honua biomass project in 2013 was 25.3 cents per kilowatt-hour over the 20-year contract.

If this same contract was signed in 2017, then in 2017 dollars the cost would be 28.6 cents per kilowatt-hour over the 20-year contract.

But HELCO and Hu Honua agreed to extend the contract from 20 to 30 years, thereby spreading out the fixed costs. With the extended contract, the price fell to 22.1 cents per kilowatt-hour over the 30-year contract.

The price of Hawai`i solar electricity in 2010 exceeded 20 cents per kilowatt-hour. By the end of the decade, the price of solar combined with a battery energy storage system was below 10 cents per kilowatt-hour.Solar Costs 2020 A

The International Renewable Energy Agency (IRENA) recently documented how the price of various types of renewable energy changed from 2010 to 2020.

Over the period from 2010 to 2020, the price of solar fell from 37.8 cents to 4.5 cents per kilowatt-hour.

The price of on-shore and off-shore wind both fell, but not as dramatically. They had started the decade much cheaper than solar, but by the end of the decade, they were competitive.

Because wind turbines take longer to install, future projections are easier to estimate. The cost of contracted offshore wind scheduled to become operational in 2023 is 8.2 cents per kilowatt-hour.

The 2010-20 decade also saw the price of batteries fall by almost 90%. The prices are expected to drop dramatically in the 2020s as battery energy storage systems increase exponentially to meet electric grid and transportation needs.

International Renewable Energy Agency (IRENA) published the Future of Solar PV report. “The price of solar electricity is expected to fall further from an average $0.085/kWh last year to $0.02-0.08/kWh by the end of the next decade and $0.01-0.05 by mid-century.”

Throughout this period, Hu Honua will have a locked-in price exceeding 20 cents per kilowatt-hour.

Hu Honua points out that they add diversity to the renewable mix on the Big Island: wind, solar, geothermal, hydro, and biomass. Hu Honua also points out that a portfolio of higher and lower-priced renewables are cost-competitive today.

The price of electricity on the Big Island is three times higher than the national average.

If all fossil fuel and biomass plants on the Big Island was replaced with solar, wind, and batteries, prices would fall sharply, except for the fact that ratepayers are still contractually obligated to pay for the outdated generation currently being used.

The Public Utilities Commission is wrapping up its two-plus year investigation of Performance-Based Regulation, seeking ways to incentivize Hawaiian Electric Company to reduce its costs. The current PUC has put the public interest and ratepayers ahead of utility inefficiencies and shareholder profits, a welcome change.

Dirty Power Plant Emissions

Hu Honua – An Open Letter to Hawaii’s PUC

ref: LETTER IN SUPPORT OF PUC DECISION – Docket No 2017-0122

To whom it may concern,

Hawaii’s PUC decision to deny Hu Honua’s exemption from a public and competitive power supplier process (in which all other power suppliers must compete to benefit ratepayers), was summed up by this well-reasoned PUC decision and explanation:

“The pertinent issue here is whether this particular Project (Hu Honua) should be exempted from competitive bidding against other renewable projects to determine the best value for HELCO and its customers. The Commission is aware that biomass resources offer different considerations than other renewable resources, such as solar and wind, but believes that these distinctions are better weighed and addressed in the context of the Competitive Bidding Framework.”

Hawaii Island (like much of the rest of the state) is on two divergent and transitional energy paths, and depending on which path we take, future energy costs to consumers and the state’s environmental impacts can range from beneficial-to-significant.   This energy transition is best exemplified by both good and bad fossil fuel replacements available to Hawaii Electric and ratepayers – enabled by present-day legislative deficiencies within state-mandated RPS rules.

Hawaii Electric’s PPA track record in addressing both cost and environmental considerations has not always been in the interest of ratepayers and our island residents.

What two better examples of clean energy versus dirty and renewable energy options for Hawaii Electric than the present day energy choices here on Hawaii Island between Hu Honua (the tree-burning) 21.5 megawatts bio-energy power plant in Pepeʻekeo, and the proposed Waikoloa Village 55 megawatt photovoltaic solar array with a 220-megawatt battery storage system – both offering on-demand power delivery options to the grid.

Which of these two examples of energy replacements options best serve the public interest and ratepayers?

We believe the graph below clearly illustrates the differences and which is best for Hawaii Island, ratepayers, and the state’s clean energy future.

Huhonua Comparison To Solar

Although not all the above points of consideration within the graph are within the regulatory purview of Hawaii’s PUC authority or mission, clearly there are other public benefits to the PUC’s decision to deny Hu Honua’s exemption from a competitive process, and considerations that exceed the strictly regulated elements of the Commission’s decision — a PUC decision the majority of Hawaii Island’s residents support, and with great appreciation.

Story Update: Sept 21, 2020

Lawsuit: Hu Honua ‘A Fiasco From The Beginning’

link: https://www.civilbeat.org/2020/09/lawsuit-hu-honua-a-fiasco-from-the-beginning/

Solar Pv Sun Image

Hu Honua – Hawaii’s PUC Rejects the Controversial Tree Burning Power Plant

Hu Honua – News Update

PUC Rejects Hu Honua

This news development is courtesy of Henry Curtis, Life of the Land, and Contributing Editor to BeyondKona –

The Hawaii Public Utilities Commission issued Order No. 37205 on July 9, 2020, denying Hawaii Electric Light Company`s Request for a Waiver from Competitive Bidding for the Hu Honua Biomass Project. As a result, the HELCO-Hu Honua Power Purchase Agreement is not considered and dismissed without prejudice, that is, Hu Honua may compete in the next request for proposal for renewable energy projects.

On December 31, 2018, as result of the RFP process in Docket No. 2017-0352, the Hawaiian Electric Companies submitted applications requesting Commission approval for seven PPAs for grid-scale, solar-plus-storage projects on the islands of Oahu, Maui, and Hawaii.

These same Solar plus Battery Storage clean power generation options also feature dispatchable (on-demand) power delivery to the utility, previously a utility sticking point with solar and wind generation power options.

RDG-PPA (power purchase agreements) feature contractual provisions that represent significant improvements over previous renewable energy PPAs (including lower unit costs for solar energy projects, now competitive with all other forms of energy generation in Hawaii

The Solar + Battery power generation options offer Hawaii, HECO and ratepayers the reliability and grid stability of 24×7 on-demand power (dispatchable power), permitting complete operational flexibility that enables HECO/HELCO [the utility] access the cleanest power option available to them under Hawaii renewable portfolio standards (otherwise know as RPS 2045).

In effect, zero emissions (zero pollution) power generation and flexible power delivery options comes at a cost that is one-half less than the controversial Hu Honua power plant, and without all the environmental and pollution problems of Hu Honua — the true beneficiaries of these clean power options are Hawaii’s environment and utility ratepayers.

To date, the Commission has approved six of the RDG-PPAs, including two on Hawaii Island, both 30 MW renewable facilities paired with battery energy storage system (“BESS”) of 120 MW-hours (“MWh”), and which feature unit pricing of $0.08/kWh and $0.09/kWh, respectively.

These RDG-PPA projects have also transformed the renewable energy procurement market in Hawaii by demonstrating that competitive bidding can result in PPAs that provide firm, dispatchable renewable energy and ancillary grid services at increasingly lower prices.

  • Pertinently, the approved RDG-PPA projects for Hawaii Island, AES Waikoloa Solar, LLC {Docket No. 2018-0430) and Hale Kuawehi Solar LLC (Docket No. 2018-0432) are 30 MW in size, which is slightly larger than the 21.5 MW for the Hu Honua Project, and at $0.08/kWh and $0.09/kWh, respectively, are significantly less expensive than the Hu Honua Project’s estimated pricing of $0.221/kWh

But its more than just price that makes these newer clean power options more attractive than Hu Honua.  They contain the ability and commitment to the utility to provide fixed amount of dispatchable energy to the utility at the utility’s discretion (i.e., available capacity), thereby eliminating number a complicated and undesirable set of contractual provisions, such as seniority curtailment, “evergreen” renewal, and risk-adjusted pricing associated with traditional PPA’s (power purchase agreements) of the past.

HELCO, Controversial Power Plant Plans –

– Previously Published May 12th, 2020

HELCO  holds as a contingency on Hawaii Island, Solar and storage projects to serve as replacements for the company’s present day dirty energy power generation infrastructure and controversial plans to re-start the PGV geothermal plant and go foward with the Hu Honua tree burning power plant.

HELCO has proposed that the Big Island Request for Proposal (RFP) for solar and storage power replacement options be conditional depending upon whether the Hu Honua (21.5 MW) and/or the Puna Geothermal Venture (44 MW) go online as power suppliers to the grid.

HELCO has an existing Power Purchase Agreement with Puna Geothermal Venture for 38 megawatts. HELCO filed a proposed Amended and Restated Power Purchase Agreement to increase the amount to 46 megawatts. The Board of Land and Natural Resources approved 60 megawatts. The Public Utilities Commission wants to know why HELCO settled for 46 MW instead of 60 MW.

The Commission now has a better understanding of the different proposals for the Big Island, both in size and in cost.

Hu Honua was aware of the timing associated with competitive bidding events unfolding and the pending Life of the Land motions to compel the release of information.

Hu Honua reacted by sending a letter to the Commission dated May 8, 2020.

“Hu Honua believes it would be helpful for the Commission to hold a scheduling conference with the Parties in this matter regarding the Evidentiary Hearing and other related procedural steps.”

“On March 10, 2020, we spoke with Commission counsel regarding the remaining procedural steps to be established and we indicated that the Parties (and their respective witnesses) to the docket were available on certain days during the first half of May 2020 for the Evidentiary Hearing. On March 17, 2020, Commission counsel indicated that an order was being prepared but, understandably, in light of the transition to teleworking due to Covid-19 social distancing directives, estimated that it may take 1-2 months for the order to issue.”

“At this time, given the need to provide the Commission with additional alternative dates and to coordinate the availability of several local, mainland and international witnesses’ schedules for the Evidentiary Hearing, we thought it would be helpful to hold a scheduling conference to discuss the Parties’ and witnesses’ available dates.”

Hu Honua is challenging the Hawai`i County Planning Director`s requirement that Hu Honua filed an Amendment to its Shoreline Management Area (SMA) permit.

The Hawai`i County Board of Appeals hearing and possible contested case proceeding has been delayed due to COVID-19, It is now scheduled for July.

Over the next month, the winning bidders will reach out to the community to discuss their proposals.


Hu Honua’s Regulatory Journey

The Public Utilities Commission held four procedural rounds with one court ruling wedged in between:

  • PUC proceeding re HELCO Request for Waiver from Competitive Bidding (2008)
  • PUC proceeding re HELCO-HHB Power Purchase Agreement (2012-13)
  • PUC proceeding re HELCO-HHB Amended and Restated Power Purchase Agreement (2017)
  • Hawai`i Supreme Court re Life of the Land`s successful appeal (2017-19)
  • PUC Re-opened proceeding re HELCO-HHB Amended and Restated Power Purchase Agreement (2019-20).

Going Forward

  • April 2nd, today, Life of the Land filed a Motion to Compel with the Commission, requesting that the Commission order Hu Honua to answer Information Requests regarding their corporate structure, and agricultural and environmental impacts; the motion was filed earlier on March 16.
  • The County of Hawaii Director of Planning determined that Hu Honua must file for an Amendment to their SMA Permit 221 and possibly also file for a Special Permit.
  • Hu Honua will go before the County of Hawaii Board of Appeals on Friday, May 8, to argue that the  Director of Planning exceeded his authority.
  • Hu Honua is also revising their permits with the Department of Health regarding their injection wells and other issues (the same injection wells which polluted a local coastline and marine habitat in 2018)
  • The County of Hawaii Director of Planning determined that Hu Honua must file for an Amendment to their SMA Permit 221 and possibly also file for a Special Permit.

Hu Honua Graph In TotalThe long and jaded history of the Hu Honua plant is a twisted journey on a path littered with politics, state and County oversight and regulatory failures, unanswered environmental and social concerns, and burdened with the economics of a broken business plan intended designed to be subsidized by HELCO ratepayers and taxpayers.

The overall regulatory and legal proceedings promoting and challenging the plant’s operation is headed to the finish line, and potential approval  All testimony, exhibits, and Information Requests are pau (completed).

Limited (allowed) community input has previously sought to address public concerns on the prospects of the Hu Honua plant. The public’s feedback has been mostly hostile and skeptical about the plant’s purported community benefits presented by its promoters.

Community concerns were amplified in 2018 when the Hu Honua plant operators (not yet fully operational) managed to violate state law by discharging industrial wastewater into the ocean near Pepeekeo and into the reef marine ecosystem.

In previous BeyondKona articles and coverage on Hu Honua (see below for article links below), the many valid reasons for the PUC and other state and county regulatory bodies to deny Hu Honua’s their permit to proceed can summed up as:

  1. Hu Honua business case assumptions, from fuel to operations are flawed – failure in these assumptions comes at little risk the plant owners and operators, with HELCO ratepayers positioned to cover the plant’s many financial failings
  2. Hu Honua environmental impacts: from climate impacts -to air and water pollution -to deforestation and supply-chain impacts make little sense in terms of economic and social benefits, especially with much power generation options
  3. The only stakeholders who need Hu Honua plant power to proceed are its financial backers — HELCO doesn’t need it as a power supplier with much better clean and homegrown renewable energy supply options available to the utility and ratepayers
  4. Tree (fuel) requirements and assumptions are risky at best and flawed. Cutting down mature growth Big Island trees and replanting replacements sounds noble, but is better suited to long term forestry practices than a fuel source (see previous Hu Honua articles for details).
    • One of many unanswered questions, the road impacts from a supply chain of heavy-loaded diesel trucks carry freshly cut trees and running around the clock to feed the beast.
    • What happens when the plant’s dedicated mature timber supply runs out and is replaced with low BTU value (low energy producing) and immature (re-planted) trees? Time to import fuel?  At one point, Hu Honua floated the idea of importing timber to burn, once the island reserves were depleted, an admission that their 30 year plan of replanting and supply replenishment will likely fail to meet plant fuel demands
    • — Hu Honua is fraught with third-world power planning compared to Kauai’s utility track record of employing 21st century clean energy technology, including their highly successful, low cost, low risk solar plus battery storage on-demand power plant.
  5. Last, but not certainly least, the Hu Honua power plant (no matter how they juggle the numbers and lifecycle assumptions) will run at “twice” the cost of solar + storage power plant, and carry with it unnecessary costs to the public and to the island’s delicate environment.

Hu Honua can produce power, but at the expense of higher ratepayer power costs.

Dean Nishina, Executive Director of the Division of Consumer Advocacy, Department of Commerce and Consumer Affairs and party to overall plant approval process, nailed it, when he stated for the record:  “I believe that the Company has not met the required burden of proof that approving the A&R PPA (Power Purchase Agreement with HELCO) is in the public interest.”

You don’t need to be an energy wonk to understand the Consumer Advocate’s conclusion in weighing the Hu Honua’s plant pollution, Hawaii Island deforestation, high operating costs and risks, as well as the loss of one of the island’s significant GHG carbon sinks, its forests.

Community objections aside, the pure economics of the plant does NOT make sense nor does it serve the public interest.

Hu Honua BioEnergy LLC (HHB) wants to clear-cut Big Island forests (trees) to generate electricity, serving as a long term power supplier to Hawaii Electric Light Company (HELCO).

Hawaii’s consumer advocate went on to say…“The Hu Honua project has not been the most expeditious means of adding renewable generation. There are other means of adding firm capacity and ancillary services, as evidenced by the recent dispatchable generation projects approved by the Commission.”   Hu Honua, is “more expensive than the recently approved dispatchable generation projects.”  “The current availability of lower priced alternatives supports even further questions about whether future savings from the Hu Honua project is a reasonable conclusion.”

Hu Honua was founded in April 2008, that was 4,360 days ago.  Hu Honua currently states they will be operational this summer (2020), and they go onto assert, will be faster than any new utility-scale solar plus storage system could go on-line.  The average solar plus battery storage power plant takes on average, from start to operation, of 6-12 months, not 12 years as has been the case with Hu Honua’s long history of missteps, misinformation, and omissions.

The Consumer advocate offered some very wise advice for Hawaii’s PUC to consider in the Hu Honua case…

I offer that, if the Commission will be required to consider GHG (greenhouse gas) and other environmental issues as part of its decisions, it may be reasonable to adopt a policy where the Commission will wait for completed actions by other agencies, such as completion of permitting processes before the Department of Health and environmental assessments/environmental impact studies, in order to incorporate those actions in the Commission’s future decision and orders.

BeyondKona has been tracking the Hu Honua power plant proposal and at the request of our readers, we provided this update on the plant and its prospects for activation. For previous articles on Hu Honua, and its environmental, social, and economic impacts on Hawaii island (if allowed to proceed) … we invite to you visit the following BeyondKona articles:     


Pv To Ev

Electric Vehicles of All Sizes Are Beginning to Disrupt Big Oil

The world’s oil companies are taking a hit due to the early adoption of electric modes of transportation and their increasing popularity.

A recent Bloomberg study indicates that EVs are removing around one million barrels per day of oil consumed around the world. Although this figure is only 1% of the 100 million barrels per day consumption rate from 2019, it is the beginning of an inevitable transformation to a global clean energy economy.

Interestingly, most of the impact of oil consumption is not coming from the market adoption of electric cars, but from two and three-wheeled vehicles powered by electric batteries – which all together are beginning to impact commercial oil use on a global scale.E Bike 1

Interestingly enough, scooters and other small-scale forms of personal; electric transportation are displacing more oil and contributing to positive environmental awareness on a larger scale than luxury electric cars.

Bloomberg’s Nathaniel Bullard stated that electric bikes, trikes, and scooters are disrupting global oil consumption on a massive scale.   In 2020, so far, this category of electrified transportation has accounted for around 60% of avoided oil consumption.

In a year that has been especially harsh to global automotive sales due to the COVID-19 pandemic, oil consumption is already at a low. Bloomberg’s analysts also foresee a 23% decline in the sales of internal combustion engine vehicles this year.

The two areas where the vast majority of the displacement of oil usage is concentrated is the United States and China; the two largest automotive markets in the world.Small Ev1

These two countries (markets) also account for a greater overall environmental and economic benefit through the widescale adoption of electric vehicles than most other parts of the world, and offer local incentives  and government subsidies in most areas, one exception: Hawaii.

It is evident that the pandemic, combined with the emerging electric transportation sector is causing significant disruptions in Big Oil plans.

An Oily Planet

Earth Day, 50 – Part 2: Hawaii at the Crossroads of Energy and Transportation

The State of Hawaii established itself early on a leader in the advancement and transition to renewable energy. This early leadership took the form of today’s Renewable Energy Portfolio (RPS) and a statewide goal that by the year 2045 the state’s electricity grid would be 100% powered by renewable energy.

The idea behind the sea-change in Hawaii’s energy policy was two-fold.

First, achieve “energy independence” from imported oil and other fossil fuels powering the state’s electricity grid.

Second, address what was even back in the 1990’s an emerging concern, the of effects of “global warming” on Hawaii and the planet – since re-named by republican strategists to the less alarming title of “climate change”.


Here Comes the Sun

Hawaii is truly all-in with renewable energy and it was easy to understand why – the state’s abundant sun and wind coupled to obvious benefits of a ready made, zero emissions, and local energy supply. It was less so with the emerging field of so-called bio-energy, case in point, Hawaii Island’s controversial tree-burning power plant Hu Honua (pending approval).Pv To Ev

With solar and wind energy, there are no supply chain problems or petro resource wars to get in the way of the consumer, affordability, and sustainability when you’re energy is self-sufficient and locally produced, stored and ready when needed.

Globally abundant natural energy sources, like the sun and wind, have the added advantage of scale, and when coupled to low cost energy storage options (as compared to building and maintaining power-peaker plants), and they can easily become a 24×7 reliable energy source coupled to batteries (example, Kauai) to meet on-demand power requirements and the variability of weather and today’s electrical grid demands – and this begun in earnest, island-by-island with the objective of completing the state’s clean energy transformation.


The Promise of an All-Electric Future Must Include Transportation

In the recent past and present, significant advances are being made in the quest replace fossil-fueled aircraft and marine cargo vessels. The advancements have ranged from military to commercial bio-fueled and all-electric aircraft.

Boeing and AirBus are developing both all-electric and electric hybrid commercial scale passenger aircraft, all of which hold a promising future for clean fuel and zero emissions flight. In Asia, low emissions marine cargo vessels are also in development.

Hawaii’s near term prospects look good for the state’s transition off its imported energy needed to fuel cars and trucks, a transportation segment of the economy which accounts for a substantial portion amount of state’s local air pollution and greenhouse emissions.


The 21st Century (re) Birth of Personal and Electrified Transportation Options

What really kicked off the race to electrification of world’s economy was greater efficiency, advancements that date back to the space race of 1960’s.

Marked by the wide scale arrival of computerization, replacing mechanical gears and wheels with integrated circuits, this transformation help to create a communications revolution and what we take for granted today in the form of a global Internet.  Integrated circuits also made possible an array of electronic products and services, utility scale wind and PV solar energy, and a virtual and electronic driven economy that now produces electric vehicles (EV) at mass market scale — and technology advances that have laid the foundation for society’s transition to a totally-electrified economy powered by clean energy and powering electric power vehicles directly from the sun.

In a strange mix of politics, legacy business interests, massive technology innovation, an environmental and social mandates to move beyond our polluted past, electric vehicles morphed from golf carts to EV replacements for 100 year old ICE (Internal Combustion Engine) vehicles.Ev Charging Line Up

Several ICE (internal combustion engine) auto manufactures have put their toe in the water with select entries into the all-electric vehicle market. Examples include, GM’s Volt, since replaced by the all-battery Bold EV, and Nissan’s Leaf. The Volt and the Leaf date back to their introductions in 2012, and in EV tech years, that is a technological lifetime.

In the early 2000’s, half attempts at electrification also came from other manufacturers which arrived in the form of hybrid cars (mostly gas powered cars, with a little added battery boost).  These first battery-assist hybrid vehicles were EV-light – very, very light and built on an ICE drivetrains with small battery packs added almost as an afterthought, and to mostly meet California’s strict vehicle pollution rules.  First introduced by Toyota and Honda in 1999, hybrid vehicles remain with us to this day, but fail in efficiency, lifetime ownership cost, and performance compared to their pure battery-electric cousins.

Modern breakthroughs in the commercialization of EV vehicles came from the first new and successful American car company in the last 100 years… Tesla, now the considered the benchmark for all-electric passenger and cargo ground transportation trucks.

The simple fact is for the majority of manufacturers attempting to enter the EV market they have been slow to do so.  Beyond business transformation issues, EV’s are extremely difficult to build at mass production scale for traditional car companies.  Technology challenges in battery technology and software, combined with Tesla’s decade old technology head start has left legacy ICE manufactures in their own  dust; primary reasons for the current gap in EV vehicle selections in any showroom near you.


Electric Vehicle consumer demand is primarily driven by two things; product availability and value. 

For Hawaii, California, and other states working to electrify their roadways, limited EV selection, in both models and price ranges has been a diminishing barrier of entry for potential new buyers. Tesla’s broadening selection of EV models represents the company’s move to deliver desirable models that are within the price range of many of Hawaii’s residents. Tesla’s introduction of its popular Model 3 sedan, is now in a price configuration competitive with Toyota, Hyundai, Kia, BMW, GM and other popular brands in Hawaii.  Ford, Rivian, and Tesla will also be delivering all-electric pick-up trucks and SUV’s, over the next two to three years. Tesla began delivering its new low cost SUV, the Model Y, earlier this year.

So, if you are in the market for a new car or SUV, you should consider an EV of choice test drive. Beyond greater selection and lower EV prices in the Hawaii market, you have to wait and special order your new EV car or SUV, as dealer support for this EV product transition has been hit and miss for a variety of reasons, which we will explore in future articles.

A traditional purchase consideration for new EV car buyers has been driving range. Better known as “range anxiety”. Limited EV driving ranges are pretty much a thing of the past, with most models coupled to advances in battery and software technology now offering driving ranges between charges of 200 to 300, and even 400 miles range between charges.

Another area of concern is purchase cost, not unique to EV buyers.  Unlike many other states, Hawaii does not provide new EV owners with a tax credit on their new purchase. There are several bills in the works designed to address this deficiency that have been deferred to the state’s next legislature session.


PV to EV, Hawaii’s path to energy independence and sustainability

Hawaii faces the challenge of maintaining public, businesses, and legislature support in order for the state to succeed in achieving needed and transformative measures. There is growing public support for EV’s, which is understandable when you talk to Hawaii’s EV owners who praise their EV’s for handily demonstrating their ownership values: reliability, performance, and significant improvements from their previously owned ICE vehicles, in both lower operating and fuel costs. Lower fuel costs may vary depending where and what you plug your EVv into for a charge (to fuel it).  Near zero maintenance is often cited as an EV ownership benefit. No costly visits to the dealer for service and the elimination of gas station stops are EV ownership benefits which are hard to deny.

The greatest environmental benefits to society from statewide EV ownership come in combination with rooftop solar. This is truly a zero sum emissions benefit to both society and EV owners, and when electric transportation truly comes into its own; directly fueling from your car or truck from the Sun; PV to EV.

Not everyone is fortunate enough to have a garage and home equipped with both solar and an EV charging station.  And finding a working and convenient public charging station today in Hawaii is more a matter of luck than planning.

The statewide development of an EV charging infrastructure is essential to the growth and acceleration of what has been a slow climb to mass market acceptance and adoption of EV’s, certainly, beyond the niche role they presently play in Hawaii’s transportation mix.  Early adopters can carry this needed transformation only so far.  State and/or private sector stakeholders must participate in the development and operation of an a cost-effective and convenient EV charging infrastructure, island-by-island designed to serve all of Hawaii.

Necessity has been called the mother of invention.  Hawaii’s state government may not or will not fund the needed charging infrastructure build out to fully transform the state’s transportation off its current Heco Ev Planfossil fuel dependencies. So it becomes essential that a market transition of this magnitude go beyond the current and proverbial cart and horse discussion of policy, into an execution stage.

HECO, the state’s largest electricity retailer has been readying itself for some time now, with a PUC push, to be one of several possible candidates that will build and manage a statewide charging infrastructure, and within the utility’s island-specific service territories.

There are also companies which specialize in building and servicing public EV charging systems on a grand scale, some examples include:

ChargePoint – previously called Coulomb Technologies – claims to manage the world’s largest network of electric vehicle charging points.

ABB — leading supplier of “downstream” solar and other power equipment components recently unveiled a range of charging solutions for fast charging of buses and cars.

EVgo — operates one of the largest network of public electric fast-charging stations in the US.

From Hawaii to California to Europe there are companies ready to step in and fulfill Hawaii’s EV charging infrastructure requirements.


Electric Vehicles – the tip of the spear

It’s estimated that there are more than 1 billion cars on the world’s roads. Of these, around 2 to 3 million are pure battery-electric and plug-in hybrid electric vehicles, according to the International Energy Agency (IEA), which further forecasts that there will be 300-400 million EVs on the road, of the approximately 2 billion vehicles projected by 2040. Proportionately, that is about 2% of the vehicles will all-electric and plug-in models.

The IEA is notorious for under-counting the EV market potential, understandable considering the organization’s fossil fuel funding roots. By IEA’s calculation, in 20 years Hawaii’s fleet of electric vehicles will eventually reach only 2% of registered cars and trucks.   Last year, the state’s 2019 EV registrations had reached 1% of all registered vehicles, and that number is projected to more than double in the next 3-5 years, and not take another 20 years as IEA has projected.

COVID-19 has presented many new near term challenges and economic priorities for the state which the private sector and the general public must now address these new and unexpected challenges. The long held policy objectives that will ensure Hawaii’s sustainability and lessening its imported energy dependency connected to a fragile supply chain must proceed, but at a faster pace.

If the current pandemic has demonstrated anything, it is that our business-as-usual assumptions are false. The state’s long held sustainability and self-sufficiency goals, plans, and objectives, once considered farsighted, are now essential to Hawaii’s future.




Heco Logo

HECO in the Spotlight – Part 2

Struck between Shareholder Priorities, Customer Priorities, and States Mandates – HECO is adrift…

Investor-owned utilities (IOUs), as is the case with HECO, are the old-school, for-profit, regulated-monopoly utilities, with a captive customer base and profits guaranteed by law.  Yet, Hawaii’s 2045 clean energy (RPS) mandate requires HECO to institute operating reforms that must, first and foremost, address needed changes without endangering the stability or economic efficiency of Hawaii’s electricity system.

IOUs like HECO, were also the driving force behind their successful drive to slow-to-a-crawl the nationwide expansion of residential and business installed rooftop solar and their independent clean power contributions to the grid.   A strange paradox for utilities like HECO who viewed this subset of utility customers with solar installed as competitors. (for more on this see “HECO in the Spotlight – Part 1”)

Hawaii’s island-based electricity systems are most likely too small to host competing same-island utilities, but not the robust expansion of distributed clean energy options in the form of residential and commercial rooftop solar and storage.

Last week Bloomberg reported that activist investor ValueAct Capital Management (a San Francisco based hedge fund and investor in HECO, is urging that the company to look outside for a replacement and successor to HECO’s current Chief Executive Officer Constance Lau, and one that will lead the utility on path that accelerates its renewable energy goals.  Something the utility has failed to do, and 100% statewide renewable energy objective, and the clock is running down out fast… for Hawaii and HECO.Heco Utilities


“The company (HECO) is at an inflection point where management can be driven either by more of the same inertia or, alternatively, by innovative, forward-looking thinking and action,” ValueAct Chief Executive Officer Jeff Ubben said in a letter to the company dated Nov. 11.  “I firmly believe the best candidate for this crucial leadership role will be found outside of the company. The problem starts at the top, Hawaiian Electric Industries executives and its board leadership have been richly rewarded for lackluster performance.” Ubben said.

Ubben said at the time that ValueAct planned to push the utility to accelerate its use of renewable energy, among other changes. He said in the letter this month that he was encouraged by the utility adding three new directors to its board in February. But was disappointed that two of them, renewable energy veterans Mary Powell and Celeste Connors, weren’t assigned to any board committees, and he believes the entrenched leadership style and culture at Hawaiian Electric holds the company and Hawaii back from realizing its full potential.

ValueAct correctly observed that HECO remains far too reliant on imported oil, which is used to produce 63% of its electricity, leading to higher rates for its customers. Also a far distance from reaching its 100% renewable energy mandate in the 20 plus years.

HECO and other investor-owned and regulated electric utilities continue to go back to well, a deep one, managed by Public Utility Commissions across the country. PUC’s generally engage in rate-making (raising the cost of power to ratepayers) in a process that requires utilities to:

1) estimate how much power their customers will need;

2) estimate the investments they’ll need to make in power plants, fuel, transmission lines, etc. in order to meet that demand;

3) estimate what rate they need to charge customers to cover those investments and offer a reasonable “rate of return” to their investors;

4) make a “rate case” justifying the rate increase; and

5) if the PUC signs off, the Utility is free to charge is customers the new rate increase, and until the next time when they make their case for another rate increase.

Hawaiian residents have paid 280% more for electricity per kilowatt hour than the U.S. average over the past 10 years. HECO recently filed with Hawaii’s PUC regulators for another rate increase.  It is more than the retail cost of energy that brothers many of Hawaii’s residents footing the bill for HECO’s slow-motion dance to clean energy, it’s what HECO does with all those ratepayers dollars (pollute or protect Hawaii’s environment) that also matters to the state’s future and to all Hawaii stakeholders.

Sunset Of Fossil Fuels

The real question is just what form should HECO’s electrical system take to best meet the challenges of the state Renewal Portfolio Standards and it’s 100% renewable energy deadline by 2045.  If recent history is any indicator, the utility will be late and short on their regulatory commitment to Hawaii’s residents, and at a cost to ratepayer that is higher than necessary (e.g. HELCO – Hu Honua power purchase agreement).

“The company is at an inflection point where management can be driven either by more of the same inertia or, alternatively, by innovative, forward-looking thinking and action,” ValueAct Chief Executive Officer Jeff Ubben said in a letter to the company dated Nov. 11.  “I firmly believe the best candidate for this crucial leadership role will be found outside of the company. The problem starts at the top, Hawaiian Electric Industries executives and its board leadership have been richly rewarded for lackluster performance.” Ubben said.

HECO and other investor-owned and regulated electric utilities continue to go back to well, a deep one comprised of ratepayers and managed by PUC’s across the country.

Like any business, utilities must justify their product cost to their target customers, and in the case of regulated utilities like HECO they also engage in rate-making processes before their governing public utility commission (PUC) that includes:

1) estimating how much power their customers will need;

2) estimating the investments they’ll need to make in power plants, fuel, transmission lines, etc. in order to meet that demand;

3) estimating what rate they need to charge customers to cover those investments and offer a reasonable “rate of return” to their investors;

4) then, they go to the state public utility commission (PUC) to make a “rate case” justifying the rate;

5) if the PUC signs off, the Utility is free to charge is customers the new rate increase, and until the next time when they make their case for another rate increase.

Hawaiian residents have paid 280% more for electricity per kilowatt hour than the U.S. average over the past 10 years. HECO recently filed with Hawaii’s PUC regulators for another rate increase.  

It is more than the rising cost of energy that concerns Hawaii’s residents, it’s footing the bill for HECO’s slow-motion dance to clean energy while subsidizing high imported fossil fuel costs to power HECO’s grid. And the there is the question of what HECO does with all those ratepayers dollars; pollute or protect Hawaii’s environment. That too matters to the state’s future and to all Hawaii stakeholders.

Another possibility, and one seriously considered during the height of the NextEra takeover controversy, is the transformation of HECO from a privately owned utility to a municipality or electricity cooperative, possible one that is better aligned with the state’s clean energy objectives and that of the public interest – an option with the potential to work well for Hawaii (e.g. Kauai’s KIUC). If Maui’s electric utility cooperative and its advance state of renewable energy deployment and utility scale battery storage is any indication, then the transformation of HECO from a privately owned utility to a municipality or electricity cooperative appears better aligned with the state’s clean energy objectives and that of the public interest.

In decision time line more analogous to wrap speed, as compared to HECO horse and buggy decision cycles, Kissimmee Utility Authority (KUA) engaged in a groundbreaking event in November for the “Florida Municipal Solar Project”, a large-scale solar energy project that will enable KUA to provide renewable energy to its customers beginning next summer– a six month timeline from groundbreaking to clean power being delivered to Florida residents.

The Project is one of the largest municipally-backed solar projects in the United States, and is a joint effort between KUA and 11 other Florida municipal electric utilities, the Florida Municipal Power Agency (FMPA) and Florida Renewable Partners, LLC.  A total of 900,000 solar panels will be installed at two sites in Osceola County and at one site in Orange County — enough solar panels to fill 900 football fields and with a  total generating capability will be 223.5 megawatts of zero-emissions solar energy; enough to power 45,000 typical Florida homes.

The question remains… what form should HECO’s electrical system take to best meet Hawaii’s Renewal Portfolio Standards and 100% renewable energy deadline by 2045.  If recent history is any indicator, the utility will be late, and will be short on their regulatory commitment to Hawaii’s residents, and likely at a cost to ratepayers that is far greater than necessary.

Headline Update

“Scott Seu, a senior vice president at Hawaiian Electric Company, will succeed Alan Oshima as president and chief executive officer of the company effective in the first quarter of 2020.” Hawaiian Electric Press Release, December 10, 2019.

…In December 2006 Scott Seu testified as a HECO witness before the Public Utilities Commission:

“Q. Do they believe that climate change is occurring?   A. I — I don’t know off the top of my head…”

By Seu’s answer in 2006, you’d think his answer was from 1986, not 2006. Seu may be good for shareholder interests, until those interests have opportunity costs for both HEI and the state of Hawaii in the form of higher energy costs and lost opportunities to transform the company into a clean energy provider instead of remaining a fossil fuel retailer of dirty energy between now and 2045.

William Giese, executive director of the Hawaiian Solar Energy Association, said he hopes Seu can help HECO embrace changes better than it has so far.

“My quick reaction is that Scott is a nice guy, and it seems like he’s competent,” Giese said. “But he’s also been at HECO for a long time, so hopefully he can shake the chains of institutional bias that have been at HECO for a while.”



Heco Logo

HECO in the Spotlight – Part 1

Hawaii Electric is the state’s 10th largest employer, employing over 2,700.  Operating as the states’ only power monopoly Hawaiian Electric companies (HECO) include Hawaiian Electric, Maui Electric and Hawaii Electric Light.

The company is use to getting its way.  Under HECO’s power stewardship, Hawaii has the highest residential electricity prices in the United States, averaging more than twice the national average.  To put it another way, even though Hawaii residents consume the least electricity in the country we pay the highest electricity bills. On average over the last 10 years, $7,500 more than the rest of the country. (ValueAct Capital 2019 report)

Altogether, HECO islands’ utilities provide electricity to 95% of residents of the State of Hawaii, operating independent and isolated power grids on the islands of Oahu, Maui, Molokai, Lanai, and Hawaii Island. The company claims a customer base of 462,225 commercial and residential customers – impressive with Hawaii’s population of 1.3 million people.

In 2008, the state of Hawai‘i signed a memorandum of understanding with the federal Department of Energy laying the foundation for a 100% renewable energy (electricity) goal to be fully implemented by 2045.  HECO was there echoing the then governor’s vision for this historic agreement, “On behalf of the people of
Hawaii, we believe that the future of Hawaii requires that we move decisively and irreversibly away from imported fossil fuel for electricity . . . and towards
indigenously (locally) produced renewable energy…”

Fast forward and a decade later and where is HECO today?

Over the last decade the state has seen a series of clean energy failures from Hawaiian Electric, including its early biofuel-led approach to the renewable energy transformation, the failure of the 400 MW “Big Wind” plan, the failure of ten of the eleven wind and solar projects competitively selected in 2013, the collapse of the rooftop solar industry, in no small part is due to HECO’s lobbying before the state PUC. The objective was simple enough, kill Hawaii’s highly successful NEM (Net Energy Metering) program, the same one that ushered in the state’s transition to a clean energySolar Vs Roof Top Solar economy.

Following a national trend, HECO and other electric utilities wielded their political muscle to reduce and eliminate compensation to customers providing electricity back into the grid.  HECO engaged in a analytical paralysis in its effort to develop a response plan to state RPS mandates in the form of a five-year resource planning effort which ended without a firm commitment by HECO and road map for outlining the utility’s clean energy transition.

“…Hawaii continues to enjoy something of an unexamined national reputation as an electricity-policy innovator, but Hawaii has not yet made good on its ambition to lead a clean-energy revolution of global significance.” (National Renewable Energy Lab 2019 report: Hawaii Clean Energy Initiative 2008–2018)

Energy experts – outside the utility wheelhouse – argue that the one-size-fits-all utility performance-based operating model and associated rate schemes now being considered by Hawaii and other PUCs around the country will fail.  The struggle with “performance measured” utility operating models is pretty basic: it’s one thing to measure performance, it’s another to develop a compensation formula that fully factors in all contributing parties working together on a path to a 100% clean energy economy.

These same energy experts also argue that utility compensation and rate schemes designed to address a rapidly changing energy marketplace are unlikely to achieved their intended goals.  Today’s utility operating model requires greater flexibility, it must be cost effective and accountable, and open to multiple and distributed clean energy generation sources connected to the grid. Equally important, it must include a fair compensation plan for all clean energy contributing parties that power the grid.

The Electricity (Supply) Act of 1926 led to the setting up of the National Grid.  So why mess with a working and nearly one hundred year old national power formula which established power monopolies designed to serve as exclusive retailers of electricity operating within exclusive service regions?

As with most historically designed and centralized power generation systems connected by long distance power grids, the core engineering constraint (requirement) are systems designed to match  the need of instantaneously electricity demand (“load”) to electricity generation, aka load balancing of power, that is centrally controlled.  So long as HECO could operate under historic business and technical models of business-as-usual, and serving as its own exclusive power supplier, all was fine.  When you need more money, you have the power and the public needs that power. So you go to the PUC and you generally get what you ask for — rate increases.  Its much easier to raise ratepayer dollars than it is to raise venture capital or go to the banks.  If you fail or succeed has little consequence to raising more capital through higher customer power rates; operating costs and profits are subsidized by ratepayers.

Rather its shareholders, not utility customers, who are the top priority of privately held utilities with ratepayers subsidizing shareholder  dividends – the primary Wall Street measurement of a company’s performance and shareholder value for publicly traded utilities.

Net Metering and Rooftop solar

That all changed when low-cost roof top solar arrived on the energy stage, and utility scale wind, solar, and storage options proved more cost effective than traditional polluting fossil-fueled power stations.  For utilities looking backwards, the overall consideration off operating in mode that is much kinder to the environment is generally not a priority, unless they are forced to address head-on their contribution to an emerging global climate crisis as part of their energy equation.Net Metering

Net Energy Metering (NEM) can be understood as the twenty-first century, distributed power generation system.

NEM gave rise to Hawaii’s rooftop solar industry, which installed more than 500 MW of renewable capacity in Hawaii over the last decade, increasing renewables’ share of total generation by 8 percent. According to HECO, over 60,000 customers have installed solar systems under the successful NEM program within the Hawaiian Electric, Maui Electric, and Hawaii Electric Light service territories.

With NEM, rooftop solar equipment can be sized to produce more (limited to 10 KW) than the customers need during the daytime, generating a bill credit that zeroes out the monthly utility bills (minus HECO’s $25 monthly flat fee for a grid connection).

The capital cost of NEM rooftop solar systems, with a projected life 25 years or more, can be recovered in a few years of operation, with ongoing utility power costs savings costs in what otherwise would have been power consumption costs to meet both day and night electricity demands. For that reason, NEM played a key role in the success of the rooftop solar industry in Hawaii and nationwide, but no more.

Utilities fought NEM from the start, their primary NEM target was the customer power rates that the utility was forced to credit back pay to this new category of utility customer. Within the industry called “prosumers”, but in fact, utilities viewing this special class of customer as … a competitor.

Nationwide in NEM markets, utilities engaged in one-sided and coordinated industry arguments before their governing PUC, and Hawaii was no different.  If they couldn’t completely dismantle the NEM program in their market (as was the case Hawaii), their backup strategy was to proposed that rooftop solar owners be only credited for the solar energy provided back to the grid at a credit equal to wholesale power rates. In effect, a instead of fair dollar-for-dollar exchange of power; in which both parties to the NEM program (the utility customer and the utility) each invested in their own power production systems, the utility sells at retail power rates and the customers sells at wholesale power rates back; creating a complete uneven playing field favoring utilities.

Rooftop Solar Labor

In the death of Hawaii’s original NEM program for which HECO argued before the PUC, the utility naturally failed to point out the capital cost investment by utility customers in their rooftop solar systems and the renewable energy cost off-sets benefits to HECO shareholders for this efficient clean power contribution — yielding environmental, social, and regulatory clean-power cost offset benefits to HECO, lowering utility cap-x and fuel costs, and by extension lowering HECO costs to non-NEM utility customers.

Hawaii’s then PUC board bought HECO’s arguments hook, line, and sinker.  Ending a program, by any measurement that benefited power consumers, the state’s clean energy transition objectives goals, and contributed to HECO’s meeting its 2045 statewide RPS obligations

After Hawaii’s PUC ended the highly successful “original” NEM rooftop solar program in 2015, a year later the Business Journal reported that the majority of Hawaii solar energy firms reporting significant job losses, once driven to record growth levels in rooftop solar installations across the state.

Today, the collapse of Hawaii’s once robust solar industry has been cut half, losing more than 50% of local (high paying) jobs from the industry’s high water mark in 2012 — mostly, directly attributed to the loss of the state’s original NEM program.

As renewable generation increasingly displaces fossil-fueled generation, the HECO Companies are increasingly planning to supplement this traditional power generation and power delivery formula with batteries, demand response, and dispatchable intermittent renewable facilities.

Tesla Powerweall Insllation

In the meantime, technology and power consumer options continue to expand, the clean power marketplace continues to surpass HECO’s management timelines for reform, and its heavy resilience on imported dirty energy to fuel its power plant investments or a genuine grid transition to clean energy.

Once considered a far future opportunity for advancing the future of state’s clean energy goals, residential battery storage systems are now beginning to provide Hawaii’s flagging solar industry a needed breath of life.  This nascent solar revival now needs reforms in regulations that match customer power storage technology opportunities and options — now readily available to Hawaii’s residents and businesses seeking power security in an uncertain power climate.

The missing piece Hawaii’s promise for clean energy independence is the removal current regulatory barriers to wide scale adoption of solar plus storage – barriers designed by HECO to do just that.

The PUC may discover, with little effort or regulatory wrangling, that enabling distributed storage and distributed solar to be an effective way for to achieve its Hawaii’s 2045 100% renewable energy goals, with HECO full and enabling cooperation. Certainly not the NEM replacement regulations now in effect that establish walls, not bridges to clean energy innovation — and regulations that do not rely in HECO’s permission to proceed with residential and business battery systems that sit behind the utility’s meter.

A coordinated statewide path to clean energy independence

Both the state’s PUC and HECO have yet to realize that rooftop solar plus batteries could also address HECO’s current power management deficiencies with their grid in accepting added solar customers, and re-open the economic benefits of a renewed statewide transition to roof top solar — without delay and unnecessary cost barriers.



Dirty Power Plant Emissions

Hu Honua Update – October 2019…

Cutting Down Hawaii Island’s Forests to Burn to Make Electricity is one of Hawaii’s dumbest and costly power production ideas yet.

See what we mean: https://youtu.be/-Q0xUXo2zEY


The origins of Hu Honua date back to 2008, and like a malignant cancer, the Hu Honua power project proposal has been difficult to eradicate.

A total absence of County and State due diligence helped enable HuHonua and its investor advocates bypass elemental questions as to project’s justification, overall costs to ratepayers and environmental impacts of this ill-conceived power production project.  Now it’s up to the PUC to decide (again), but this around it is the question of Greenhouse Gas emissions that will be produced or off-set by the operation the Hu Honua power plant.

During the past 5 years, public (and ratepayer) opposition to the project has grown, and with increased scrutiny the economics and environmental life cycle impacts of the project (although only partially considered by the state and the current PUC process) increasingly looks bad for Hu Honua.  Faced with more cost-effective and environmentally benign power substitutes now available to HELCO, Hu Honua makes little sense as it may have its vested interests when first proposed.

On October 21, 2019 HELCO submitted to the state PUC their reasoning and their defense to questions raised by a Hawaii-based citizen group (Life of the Land) lawsuit. They questioned the public merits of the project and its environmental implications.  The utility’s response to the question of added greenhouse gas (GHG) emissions  resulting from Hu Honua’s operation was, and is, the primary issue now at hand.  HELCO’s reply can be summed up in their submission as...”It is Hawaiʻi Electric Light’s understanding that assumptions and detailed calculations for the lifecycle emissions from Hu Honua Project will be presented in the Hu Honua GHG Analysis report to be filed separately by Hu Honua.”   

The Hu Honua reply side to the PUC followed HELCO’s submission and mostly copies the utility’s statements with one exception, HuHonua failed to include the biogenic carbon dioxide emissions in determining compliance with the CO2e emissions cap.  By failing to fully answer this key question as the proposed plant’s GHG pollution emissions impact, Hu Honua should be denied their permit to proceed, plain and simple, but it remains to be seen what the PUC decision will yield.

HELCO invested considerable ratepayer dollars in hiring a sophisticated energy consulting firm, Ramboll, known for their work in lending life to fossil fuel plants and advancing waste-to-energy (burning trash to create electricity). There is nothing wrong with Ramboll, expect that their consulting expertise is heavily weighted to projects and technologies that do little evaluate impacts or measure the net production of global warming emissions from power plants. The requirement for weighing “lifecycle greenhouse gas emissions” in energy decisions, although new to Hawaii and its PUC, is an increasingly common metric in other power markets.

With every consultant or attorney there is the art of language.

If language is plain and clear it does not always serve its intended purpose.  Such is the case in the field of energy and from an entire dirty energy industry sector that is now scrambling to respond to public and regulatory pressures to address “their” role in an emerging global climate crisis.  Thus the name invention of bio-fuels and bio-energy as clean or renewable energy sources, which in some cases they and others they are not.  Hu Honua falls into the latter category.

Convincing Hawaii’s state legislators that their creation of a well meaning 100% 2045 renewable energy mandate for the state that includes both dirty and clean energy substitutes as qualified fossil fuel energy replacements is another matter entirely.  Biological based energy sources or Bio-energy, as is the case of the HELCO-Hu Honua power agreement, is a controversial energy fuel replacement strategy and one that is at the heart of this power application before the PUC.

Increasingly, replacement substitutes for fossil-fueled electricity sources must be weighed not only on their direct cost ratepayers, but their total costs to society and taxpayers.

Greenhouse Gas Emissions – include, but not limited, to CO2 (carbon dioxide), methane, etc. Primary GHG sources: Fossil Fuel Power Plants, Transportation, Oil-Gas extraction.

Biogenic (carbon dioxide) Emissions — include emissions from a stationary source directly resulting from the combustion or decomposition of biologically-based materials other than fossil fuels, in the case of Hu Honua: Trees.  When sustainably sourced, combustion from such fuels (it is argued) do not result in significant or lasting increases in atmospheric CO2 concentrations.

The basis for this theory goes like this…Bio materials burned for power are then replaced with new plants and trees which serve carbon sink replacements for those bio materials harvested for power production — this, however, is not the case with HuHonua and its business case that is built on burning free Hawaii County trees and until the supply is exhausted, at which time added fuel (trees) will be imported to burn when and as needed cost and GHG transportation are unknown, but accumulative.

The 30 year long HELCO power-buy agreement from Hu Honua does not consider the costs and implications of an exhaustible Hawaii Island based bio fuel source for which the proposed power plant has been designed.

Energy Emissions Pic

Not all sources of biogenic carbon are rapidly renewable, if they’re renewable at all. Clear examples of this include old growth forests, peat bogs, or other sensitive and enduring ecosystems. In fact, use of biogenic carbon as a fuel source could even result in damage to that ecosystem while increasing atmospheric CO2

In the case of the HELCO-Hu Honua power agreement, both parties must now weigh and project the GHG (lifecycle) impacts of the proposed bio-energy planet on Hawaii and the planet.

HELCO just presented to the PUC (10-21-19) its own data as to potential replacement of GHG emissions output by substituting HuHonua energy for some of its predominantly fossil fuel (diesel-fired) power plants, and in two scenarios: with and without, the reactivation of the island’s Puna geothermal power plant.

The HELCO GHG emission assumptions include Hu Honua serving as an operating power replacement for some the utility’s fossil fuel-based power generation sources. The utility asserts that the HuHonua will reduce GHG emissions from the grid’s status quo assumptions, but it lacks the inclusion of some fundamental factors Hu Honua represents to ratepayers, Hawaii’s environment (air,water, and land), and utility’s other clean power replacement opportunities for Hawaii Island.

HECO/HELCO have announced plans for utility scale solar, wind, and storage projects, but the substance of these projects remains uncertain, and the utility continues to talk clean energy, but fails to walk their talk.  Rather, HECO has consistently worked (effectively and statewide) to retard the advancement of rooftop solar and consumer-based power storage options, and instead has spent ratepayer dollars to protect its power monopoly status

None of these zero emission power options carry with them the environmental and socioeconomic impacts of the HuHonua power plant if allowed to go online.

It’s now up to the PUC to decide on docket 2017-0122 and the future of energy on Hawaii Island.

Public Comments on HuHonua Requested – Response Deadline: Nov. 26th, 2019

Posted on November 1, 2019, by Henry Curtis

The Hawai`i Department of Health has opened another climate change public hearing regulatory process that many consider meaningless.

 The Hawai`i State Legislature asserted that climate change is an existential threat to mankind, the Department of Health should regulate greenhouse gas emissions, and that the regulations can be developer-friendly and extremely weak to non-existent.

DOH issue permits dealing with existential threats to planetary ecosystems.  The DOH permit to pollute remains in effect during public comment periods, contested case proceedings, and legal challenges. Expired permits remain valid until renewed.

In the case of Hu Honua, the public is requested by DOH to submit comments until November 26 and may ask for a public hearing or a contested case proceeding. 

Mail: Department of Health, Clean Air Branch, 2827 Waimano Home Road, #130, Pearl City, HI 96782

Email: cab@doh.hawaii.gov

 Hu Honua wants to chop down and burn forests to generate electricity.

Life of the Land has requested a contested case proceeding.

The public is invited to participate in commenting on the proposed Hu Honua “updated greenhouse gas (GHG) emission reduction plan dated August 2019.”

The Hu Honua Covered Source Permit (air pollution permit) issued “on February 18, 2016, and amended on December 11, 2018, shall not be affected and shall remain valid.”

The Hu Honua facility will have a greenhouse gas emission limit. “Hu Honua Bioenergy Facility shall not emit or cause to be emitted carbon dioxide equivalent (CO2e) emissions in excess of 3,979 metric-tons (4,386 short tons) per calendar year.”

The cap does not include biogenic emissions — which is the only type of emissions that Hu Honua will emit.

Hawaii Administrative Rules (HAR) specify that “Except for fee assessments and determining applicability to this section, biogenic CO2 emissions will not be included when determining compliance with the facility-wide emissions cap until further guidance can be provided by EPA, or the director, through rulemaking.”

HAR defines Biogenic CO2 emissions.

“CO2 emissions from a stationary source directly resulting from the combustion or decomposition of biologically-based materials other than fossil fuels and mineral sources of carbon.

“Examples of biogenic CO2 emissions include, but are not limited to: CO2 generated from the biological decomposition of waste in landfills, wastewater treatment or manure management processes; CO2 from the combustion of biogas collected from biological decomposition of waste in landfills, wastewater treatment or manure management processes; CO2 from fermentation during ethanol production or other industrial fermentation processes; CO2 from combustion of the biological fraction of municipal solid waste or biosolids; CO2 from combustion of the biological fraction of tire-derived fuel; and CO2 derived from combustion of biological material, including all types of wood and wood waste, forest residue, and agricultural material.”


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