You say you want a revolution,
Well, you know we all wanna change the world..  

First there was the Russian Revolution in 1917 when several groups loosely afflicted with what would later become Russia’s Communist Party overthrew Russia’s last royal family, Nicholas II, czar and absolute ruler of Russia.

Two world wars and one cold war later, the second Russian resolution managed to throw out of power the Communist controlled government, that was back in 1991. With it came the establishment of a short-lived experiment in democracy, coupled to a hybrid form of capitalism led by President Yeltsin. That revolution only lasted a brief 8 years before the transitional government takeover by Vladimir Putin, ex-KGB and hard core communist, who turned his hammer and sickle in for a starring role as Russia’s absolute leader and chief oligarch.

With the invasion of the Ukraine, Russia’s highly leveraged military machine has surprisingly suffered major losses since the start of the war with and in the Ukraine. Increasingly reliant on internal mercenary factions, and most specifically, the Wagner Group, these mercenaries-for-hire are a part of a growing network of Russian-based organizations that serve as military contractors, and the Wagner Group led by chief Yevgeny Prigozhin is key to Putin’s plan for victory in Ukraine.

The reasons for Putin pushing Russia into an unwanted and unwarranted war with the Ukraine I’ll leave to historians, but Wagner Group’s Prigozhin summed the war with Ukraine this way, “What was the war for? The oligarchic clan that rules Russia needed the war.”

The Wagner Group’s cannon fodder style battle strategy has been reasonable successfully against Ukraine’s highly trained, often outnumbered, but committed forces. As long as Wagner has unlimited access to Russia’s military supplies and prisons to restock its highly expendable rank and file, they will remain a major threat to Ukraine’s war plans.

In what has been mounting criticism of the Russia’s military leadership, Wagner’s Prigozhin has been in engaged in a feud with the established military leadership, a feud that  has been simmering for months. Prigozhin, however, has been careful to avoid naming Russia’s president Putin,  carefully avoiding any direct criticism.  He has, however, repeatedly slammed Defense Minister Sergei Shoigu and Chief of the General Staff of the Russian Armed Forces Gen. Valery Gerasimov for not supplying his forces with enough ammunition and for failing to conduct the war effectively

Prigozhin’s challenge to the Russian Defense Ministry — and by proxy, to Putin — has thrown Moscow into an unexpected crisis that threatens to undermine Putin’s war effort in Ukraine.

Prigozhin’s conflict with Russia’s military leadership over the course of the long, bitter fight for Bakhmut came to a head this week, with Wagner group forces making an abrupt about-face after heading back into Russia on the road to Moscow and Putin’s doorstep, who at last report had left the Capital for an unknown destination.

Putin mobilized Russian troops on Saturday to defend Moscow from what he called an armed rebellion by Mr. Prigozhin, whose forces had claimed control of Rostov-on-Don and were seen moving north along a highway toward the Russian capital. Then, in a surprise turn of events, the Belarusian president, Alexsandr G. Lukashenko, said he had secured Mr. Prigozhin agreement to halt his forces’ advance. Mr. Prigozhin confirmed that he was turning his forces around.

With the outcome the Wagner Group’s aborted march on Moscow earlier today, and the events of the last 24 hours, world leaders are monitoring the situation closely while the stability of world’s second largest nuclear power hangs in the balance.

Before Russia’s war in Ukraine, Americans may recognized Wagner’s Prigozhin as the financier of the Internet Research Agency — the Russian “troll farm” that the Justice Department indicted in 2018 for interfering with the United States’ 2016 presidential election by weaponizing social media in moves designed to support the Trump candidacy.

For ongoing coverage of Russia’s invasion of Ukraine see BeyondKona’s “Headline News” section: https://www.beyondkona.com/national-headline-news/   

What to expect in 2022 and beyond, but some background first…

Inflation in the U.S. is at its highest rate since 1982, rising 8.5% over the year to the end of March as the war in Ukraine drove up energy costs for Americans, the labor department announced on Tuesday.

Even though unemployment is falling and wages are rising, inflation is costing the average American household an additional $296 per month, according to Moody’s Analytics, and people have been feeling the crunch.

About one in five Americans think inflation and the high cost of living are the most important problems facing the country today. They’re more worried about inflation than about Covid-19 or the war in Ukraine.

In a recent New York Times interview Paul Krugman, Nobel Prize Economist explains what’s up with today’s economy and what’s ahead.

The implications for Hawaii are obvious.

• Do you think the economy is good right now or bad or in between? And what are you looking at to make that determination?

PK:

It’s a really good economy with a couple of problems. It’s the best job market possibly ever. It’s easier to get a job than it was during the height of the Clinton era boom, which is great. Yes, inflation is uncomfortably high. Inflation by itself bothers people, but in some ways, it shouldn’t matter if wages were keeping up, but they aren’t. So we have a situation where people who already had jobs have 1 percent or 2 percent less purchasing power than they did a year ago. So it’s not an A plus, plus economy, but it’s certainly immensely better. Compare this with where we were at this stage after the financial crisis, and it’s a great economy.

• Inflation has gotten a big focus for people, but first, the job market. The unemployment numbers are down to a new pandemic low of 3.6 percent — astonishing. What more can we expect?

PK:

So there’s always going to be some unemployment. There’s churn. People used to talk about the mirror test for unemployment. If your breath would fog a mirror, you could get hired. And we’re in that kind of market, which is, that’s a good thing. And what it’s especially good for is, it’s good for young people because those people are getting a good start on their careers. A tight labor market is a really, really good thing from a lot of points of view, from a social point of view, not just purely monetary.

• The housing sector; rents are up more than 30 percent in some cities. How long can this go on?

PK:

We had a crazy housing market pre-2007. That was a bubble, and it was concentrated in places where it’s very hard to build a house, basically places where the NIMBYs have prevented housing construction, like San Francisco. Rents are also up in small towns. And it seems to be that we just haven’t been building enough housing anywhere, possibly because people got burned by the housing crisis, possibly because of all these supply chain issues. Whatever they may say about the economy, people are actually feeling that they have cash, and but we just haven’t built very many houses since the big housing crash 15 years ago.

• Would a building boom help?

PK:

One of the sort of longest standing problems we’ve had in the United States is that we have not allowed enough housing to be built in places where people want to live and where businesses want to locate. San Francisco was famously bad, but New York, too. New York is a great place to live if you can afford it.

• You’ve written that the American economy is, quote, “running very hot right now.” Can you talk about what you mean by that?

PK:

It’s like an engine. How many rpms are you running the engine at? The U.S. economy is currently running, it appears — all the evidence suggests that it’s running in a situation where there is more demand for workers than there are workers willing to accept jobs for whatever reason. There’s more spending out there than there is sustainable capacity to meet the demand.

• So who’s winning and who’s losing in this economy?

PK:

Well, you know, for the most part, there are not very many serious losers. Some wages have lagged a little bit behind inflation, but it’s really not a big deal and corporate profits are really high. The losing part is that you worry. And this is what we learned. The hard lesson we learned in the 1970s is that if you run the economy too hot for too long, then inflation gets entrenched in the economy. And since people don’t like inflation, both because of the real damage it does, but also because it conveys a sense that things are out of control, then everybody starts to raise prices just because they think everybody else is going to raise prices, and then getting it back down can be very expensive. So inflation in 1979 was not actually that big a problem directly. Wages were rising about as fast as prices were. Trouble was, that inflation had to be reduced,  and what followed was a horrific extended slump in the economy.  It was what it took to get inflation down that hurt almost everybody.

And that’s what we’re worried about now, but I would argue pretty strongly, we’re not at that point yet.

That if we can bring this inflation under control in the next year or 18 months, then nothing bad really will have happened. But what happened in the ‘70s is a cautionary tale.

• According to a recent Gallup poll, rising prices are the number one economic concern. It’s the number one concern for Americans right now, despite Ukraine, despite whatever is happening. And there’s a lot happening. A survey in late March found that 31 percent of those polled think the economy is good, 64 percent believe it’s in bad shape. How unusual is that, are those feelings you just talked about, if people perceive it it’s so?

PK:

Well, you have to hold two thoughts in mind. One, yes, inflation is a real problem, and it’s disturbing that it’s this high. Two, People know that people’s perception of the economy does seem to be way out of line with how bad things really are. This is not a great situation on inflation, but it’s a very good job market. it’s easy to find jobs, but if you ask them, recent polls I’ve seen say that a plurality of people think that the U.S. economy has lost jobs over the past year, which is crazy. And that, is a media failure.

Self-identified Republicans say that the economy is worse than it was in 1980 when we had 8 percent unemployment and 14 percent inflation. So there is something going on here where people have gotten into a sour mood and, to some extent, is what they see on the chyrons on cable T.V.

• What about gas prices?

PK:

Part of the thing is that gas prices, although they’re high, adjusted for inflation, which sounds a little bit funny, but the price of gas compared with the price of other things is not all that high by historical standards. It’s not — even within the last decade, we’ve had times when gas has been this expensive. But it just happens to be a highly visible symbol of stuff out there.

• How much is it tied to what’s happening in Russia and Ukraine and the impact on the energy sector, and how much is the fate of the economy tied up in that one sector?

PK:

Oil prices had been rising quite a lot before. And then we have Russia, which is a significant oil exporter. We don’t know how much oil the Russians are actually managing to get out, but certainly been some oil removed from the market, and there’s almost certainly some panic buying out there as well. Actually, if you really want to know about Russia-Ukraine, the much bigger issue is food.

Russia has 11 percent of world oil production. But Russia plus Ukraine are also about a quarter of the world’s wheat exports.  Gasoline is a few percent of the average American family’s budget. Food is somewhat higher, but a fair bit of that is not actually the cost of the foodstuffs. It’s the cost of the packaging, the preparation and the marketing. These things by themselves are not all that huge, but they all add up. If you’re talking about poor countries, then this rising world price of food is a very serious thing.

• People notice the cost of food or milk and things like that. And on top of that, the supply chain around the pandemic was also impacting prices. Are there other factors?

PK:

Because of the internet and all that, we started to think of ourselves as having this sort of dematerialized economy, where everything was frictionless. And it turns out most of the stuff we want has to get manufactured and has to get shipped from place to place. There is shortage of shipping containers, a shortage of port capacity, especially if the mix of things that people are buying is very — a little skewed from what it is normal, which is what happened after the pandemic. Now, some of that may be starting to ease, but one thing after another keeps happening.

• Because we’re used to an economy where you click and get?

PK:

That’s right. It’s designed to be invisible to us, a little bit like Amazon. Click on the button, then stuff appears on your doorstep. And there’s actually a million workers in Amazon facilities around the country making that happen. But we’ve had a lesson that the physical logistics of the economy are both much more important and much more fragile than we had realized.

• So as you see higher gas prices and higher food prices, is there any other area you think is something that you’re paying attention to in terms of pricing, rents are higher? And they’re all for different reasons?

PK:

All of it would be less inflationary if the economy wasn’t running as hot, right?  Look, we did the right thing by rescuing people during the pandemic. We had a tremendous amount of financial aid from the government that helped people get through it, but also created a lot of spending power which created strong demand.  All of these things are, to some extent, reflecting that.

There are special factors, and every industry is different, but there’s a kind of shared overstimulation that’s affecting a lot of stuff – the stuff that is made up of temporary disruptions.

There are also the supply chains relating to food and energy. Food and energy can be measured easily. The other stuff is a little bit harder and trickier, to be sure. And then there’s the general overheating, however, I do believe the supply chains will this get sorted out.  It’s just taking longer than we thought.  There’s enormous financial incentives to make it work. That part of inflation will come down.

The overheating is more difficult to judge, and we’re not sure yet what it’s going to take to bring that down. The important thing is to get all of this stuff down before people start to think that inflation is a permanent condition.

• A permanent condition? Republicans have tried to pin some of the blame on stimulus payments in 2020 and last year, creating demand, and people wanting to spend. And of course, that makes sense, coming out of a pandemic with all that pent up demand. Would you put any blame on the stimulus payments creating that situation? Are they right?

PK:

A little bit. It made sense to provide a lot of aid. There were some things that probably didn’t make a lot of sense. The higher unemployment benefits were really necessary. The expanded child tax credit, we should keep forever, which we won’t, but we should because that was really doing a lot for children. Those $1,400 checks probably did not make a whole lot of sense.

And it turns out we had a lot of aid to state and local governments that ended up not being needed, although also mostly not being spent. So I would say that the stimulus money presented less than one percentage point of the inflation.

• So you’re saying the economy is actually good. People don’t think it is, or that it hardly matters?

PK:

Well, it’s a little of both. Inflation is real. It has always been the case that inflation bothers people. To say, well, it shouldn’t, that doesn’t help. If we look at the things we think will really matter in the long run, which is getting people back to work, getting young people into the job market, having a solid recovery, then, actually, Biden has done really, really well, but he’s not going to take credit for it.

• Inflation tends to hit poor people harder. And so it does affect people beyond their perceptions, even if they’re getting jobs, correct?

PK:

Yes, although the one thing you want to say about it is, wages are up a lot, and not up enough on average to keep up with inflation. But the wage increases have been biggest at the bottom end of the scale. Although inflation may be hitting the true inflation rate for people in the bottom third of the wage distribution, it is higher than the average inflation rate. The rate of wage increase for those people is also higher. And it’s not all clear.

In fact, most of the stuff I’ve been seeing suggests that, actually, this economy’s been pretty good for people further down.

• How do we bring inflation down? How do you cool off a hot economy? Talk about ways to cool off a hot economy. Obviously, interest rates is one of the top ways to do that.

PK:

Well, I think pretty much interest rates is it. That’s the only thing we need to do. The big spending is behind us now. I don’t think that Build Back Better would have been particularly inflationary, but that’s not going to happen anyway because Joe Manchin is not going to let it happen. All of that spending that took place in early 2021 is now receding rapidly in the rearview mirror. And so it’s interest rates, and the Fed has only raised the interest rate it controls directly by a quarter of a percentage point. And the biggest place where you have leverage here is housing. Mortgage rates are now up a lot in just in the last few months.

And that’s going to have an effect. It’ll take a while, but it means that presumably, these bidding wars for houses are going to cool off. But more to the point, if you’re a developer thinking about building a bunch more housing, the price at which you can expect to sell them is going to go down. There are a few other things there as well. To some extent, business investment is going to be cooled off by these high interest rates. And consumers are going to start to feel a little bit less wealthy as house prices start to descend a bit.

This is how we ended the great inflation of the 1970s, within a period of extremely high interest rates. I don’t think they’ll need to go anywhere near that high this time. But that’s how you do it.

• Treasury Secretary Janet Yellen said in October of last year, I don’t think we’re about to lose control of inflation. She obviously was trying to calm the markets, but you think they do have control of it?

PK:

Well, I think it’s not yet out of control and probably not going to, but that’s not a certainty. As long as people believe that it’s (inflation) temporary, then it’s not that hard to end. And people do seem to believe that it’s temporary. One of the economic principles for policy that’s worked really well has been to say, do not base policy on food and energy prices. Focus on core inflation. We had a spike in inflation in 2008 and another one in 2010, 2011, both of which the Fed, to its great credit, said, not to worry. This is a temporary phenomenon. And that’s mostly where we are now. This does not yet look like an economy in which inflation is out of control. It looks like an economy that’s hit a rocky patch, but that’s all.

• What does 2022 would look like?

PK:

The answer is, it will be a year of slow economic growth, slower than last year, slow enough so that, in fact, maybe the unemployment rate ticks up a little bit so that employers don’t feel that they have to bid desperately to get workers, but one in which wages continue to rise and jobs continue to be readily available to people who want them. And all of the components of inflation just start coming down, and people start to relax about the whole thing.

• How do we get out of this? Is there an argument for letting inflation be at all, that it’s a byproduct of stimulus, helping Ukraine fight the war, et cetera, et cetera.

PK:

Within limits. Where we are now with 8 percent inflation, that’s not OK. First of all, people really hate it. And it does have some serious downsides. At that level, you start to get to a situation where you’re starting to impair the usefulness of money because the purchasing power is too unpredictable in the future. On inflation, there’s really two things.

One is that all of us tend to feel that we earned our wage increase, and that the price increase was that something that was done to us, even though it’s actually part of the same process. That’s a slightly discreditable thing, but then there’s just the sense of things of being of control. And an economy with 2 percent inflation is an economy where people feel — they’re aware that prices tend to rise a little bit, but they don’t feel that things are disorderly.

So I think that’s the point, is that inflation, it doesn’t do much good to tell people that inflation shouldn’t matter. It does matter in people’s perceptions. People won’t start to feel better until it comes down some. If things play out the way I think and hope they will, we will see inflation coming down quite a lot late this year or early next year.

And what if we reach a point where now we’re sort of at 3 percent inflation, and the normal target has been 2? Is that the time to just declare victory and pull out, to say, OK, that’s good enough. And I will probably be on the side of people saying, yeah, OK, we can stop the squeeze now. This is OK. Because there’s really no concrete evidence that 3 percent inflation does any significant harm, compared with 2 percent inflation.

• You said inflation will come down late this year, early next year, that people aren’t concerned about the long-term. But that’s after the midterms. Do Democrats have enough time between now and November to convince Americans that the economy isn’t as bad as they seem to feel it is?

PK:

I have absolutely no idea.

Historically, Hawaii County government has been mostly absent on the subject of energy, leaving such matters to HECO (HELCO) and to state’s regulators and legislators. Most of the island’s mayors have historically had other agenda priorities that generally do not include energy.

An exception to this policy path came when the island’s former mayor Billy Kenoi (2008-16) was pushing Waste-To-Energy (WTE) as the County’s salvation and solution to an overflowing Hilo waste landfill.  A decade ago, burning trash for energy (WTE) seemed to some as the perfect answer towards addressing two of the County’s major (and ongoing) problems; an ever increasing volume of consumer waste, and the high cost of imported energy required to fuel the island’s electrical grid – something the County is very familiar with as HECO’s largest island customer. The WTE idea certainly had merit, but its critics included residents who had unanswered questions as to public costs and the certain environmental / climate impacts associated with burning waste for energy — questions that continue to dog WTE technologies to this day.

Is Hydrogen in Hawaii’s Future?

Fast forward to 2021, Mayor Mitch Roth’s administration is on a path back to the future.

Roth is following an energy strategy which gained national visibility during the Obama administration’s 2011 “all-in alternative energy policy”.  Roth’s Deputy Managing Director Bobby Command put it this way …”the County of Hawaii supports a diverse portfolio of alternative energy producers”.  It turns out, a “diverse portfolio of alternative energy producers” in this “all in” are welcome strategy is pointed towards two basic outcomes: 1) They are not based on fossil fuels, and 2) hydrogen production could be their end product.

When it comes to hydrogen as a transportation fuel and substitute for fossil fuels, and more specifically an alterative to battery electric vehicles, hydrogen is at a disadvantage in some fundamental terms facing questions of energy efficiency, costs, complexity, scaling, and the absence of a fueling infrastructure. Questions which continue to plague hydrogen’s technological advancement as a fuel for the general population of transportation users.

Then there are the risk factors. The funding of hydrogen projects, be it public or private sector investments, and especially pitting hydrogen vehicles against BEVs, the clear advantages are with BEV’s which have already demonstrated proven market competitiveness, and are being driven by rapid technological and commercial advancements in battery electric vehicles (BEVs), best typified by Tesla Motors – the winner; and Toyota, the loser.

Germany has long been a leader in hydrogen fueled vehicle research

In fact, BMW has been operating a test fleet of 50 H2 fuel vehicles for over 10 years. BMW’s conclusion matches other studies primarily focused on passenger car vehicles powered by hydrogen:

• Prof. Maximilian Fichtner, Dep. Director of the Helmholtz Institute Ulm for Electrochemical Energy Storage and designated expert in hydrogen research, summed things up this way:  “hydrogen has very poor energy efficiency well-to-wheel” and these basic facts favor battery-powered electric cars are “on an order of magnitude more efficient”.
• Prof. Fichtner continues: “I’m not against hydrogen as an energy storage medium at all. We just should make use of it where it makes sense – and that’s not in the car, but in the stationary area.”
• Hydrogen fuel cell e-cars so have some advantages over BEV’s (range, fast refueling, no heavy battery on board), but they also have one decisive disadvantage: efficiency and cost. “No sustainable economy can afford to use twice as much renewable energy to drive fuel cell cars instead of battery-powered vehicles”, Prof. Fichtner .

We agree with Prof. Fichtner, hydrogen (H2) holds great promise in renewable energy-powered grid storage applications.  Although the jury is still out on the potential use of H2 as a fuel for large commercial trucks and buses over long distances (as well as heavy duty construction equipment). The promise of H2 as a replacement fuel in these transportation applications (and even as a possible fuel replacement for commercial aircraft) is at such a nascent stage of development and deployment it’s difficult to image a County fleet of vehicles all running on H2 (cost effectively) by 2045.

H2’s promise:

Widespread adoption of hydrogen for large vehicle commercial transportation applications is far from certain, but H2 does hold some advantages over BEV’s in the form of  large truck and buses.

There are inherent BEV issues of battery weight, range and longer refueling times, which only increase with size and capacity, making batteries potentially less competitive within the commercial large vehicle sector.

Yet, companies such Tesla and NIO have already proven (at the beta test level) that BEV’s can compete with large fossil fuel commercial trucks and with their H2 counterparts (picture of Tesla’s Semi BEV commercial long haul vehicle).  BEV’s hold the advantage of being further along in technology development, fueling infrastructure, and commercial deployment over H2 prototypes.

What do consumers gain from H2 as a clean fuel alterative?

What is clear is that hydrogen-powered e-cars will increasingly become more expensive to drive than battery-powered vehicles, not only in terms of purchase, but also in terms of operation and overall ownership costs.

Climate Priorities and Energy Meet

A decade ago, Climate Change was as big an issue as it is today.  The difference, we are well beyond theory and now into the full on consequences of global warming,  driven by an urgent need for fundamental corrections in the dirty energy matrix now governing our global economy.

Hawaii’s once far away statewide 2045 clean energy goal for transitioning the state off imported oil is now 20 years closer to that deadline.  It’s increasingly obvious to lawmakers and government administrators, and I would add the general public, that much more needs to be accomplished in a statewide transition to a clean energy economy. Hawaii County, like it’s sister island county’s have produce noble proclamations towards addressing climate change and a transition to “sustainability”, but words lose their meaning without the necessary actions to back them up – and climate clock continues its relentless countdown.

Mayor Roth, and a supportive County Council, should be applauded for their efforts in working towards enabling this great transition to clean and sustainable energy. But in such a great transition involving social, economic, and environmental changes of this magnitude, greater public scrutiny and involvement is required. Ultimately, taxpayers and ratepayers will be footing the bill for decisions and policies enacted today that will have far reaching effects on the island many of us call home.

Biomass or Biomess

The County has a history of tacit support of biomass/biofuel projects in the name of clean energy and/or advancing agricultural, yet neither have proven to be the case.  This appears to continue to this day in Roth administration’s approach to so-called energy alternatives.

Hu Honua, and other non-fossil fuel combustion energy generation technologies, without much due diligence on the State and County’s part, are following a playbook from more than decade ago embodied in the state’s far reaching 2045 RPS plan – a plan to get-off the state’s fossil fuel dependency. which translated into a blank check for emerging and unproven biomass technologies lacking any pollution prohibitions.

Case in point, Hawaii Island’s Hu Honua’s plans for a finite and unsustainable forever supply of island trees-to-chips to burn for power. Then there is the long and winding intra-island supply chain road, marked by diesel pollution and wear and tear to be considered. The infrastructure and environmental consequences of HuHonua don’t stop there, with island deforestation coupled to air and water pollution powerplant byproducts as part of the price for biomass which is not factored into the electricity ratepayers pay to HECO, but are added into their County and State taxes.  In Hu Honua’s case, the power funded by ratepayers is also at unjustifiable energy rates, twice (2x) the cost compared to solar-wind-storage alternatives which further offer a track record of delivering power with greater energy reliability and security, but with the essential benefits of zero pollution (emissions) for delivering truly clean energy to ratepayers.

In short, Solar, Wind, Battery and/or Hydro Storage couple to advanced energy management and control systems, deliver to the public, the County, the state, and of course HECO non-polluting energy sources competitive to all other alternatives presently under consideration and supported by the Mayor.

The scientists who study climate change, the global carbon cycle and forest ecology tend to reject the notion of biomass is anything close to carbon neutrality. Those concerns extend into a  general opposition to forest biomass because it contributes to climate change while disrupting important ecosystems and the biodiversity they support. They also object to this source of energy because burning biomass (trees into pellets as with Hu Honua powerplant plan) produces pollutants that endanger the public health.

Hawaii Island’s Agricultural and H2 Energy Plans – a marriage made in heaven? 

HuHonua is not the only example of where agricultural (deforestation) and energy form a nexus in past and present County policies. Hawaii County, like the rest of the state struggles with so-called invasive species (as referenced below in the Robert Command email), and ironically, are proving to be more climate-tolerant than so-called native species.

Considering a majestic Hawaiian eucalyptus tree described below as “horrible“, or an official County endorsement of Hu Honua after years litigation and PUC objections into Hu Honua power proposals, all of which demonstrate the present weakness in the Mayor’s energy plans — in short, a complete absence of due diligence into environmental, social, economic, and public interest consequences of an energy policy made in a vacuum of much needed public oversight and accountability.

Bobby Command, Deputy Managing Director, Hawaii County see things differently.  “As we rid our island of horrible invasive species such as eucalyptus, albizia and ironwood, we create carbon sinks as we replace them with indigenous and endemic species such as koa and sandalwood. When no longer economically viable, energy from biomass will be phased out and morphed into technologies such as waste-to-energy.”

All of these technologies, when coupled with the production and use of clean burning hydrogen, will focus us on our goal, which is 100-percent alternative energy production with a sustainable net-negative carbon footprint. 

The truth is, the current County administration is building a case for what they see as an inexhaustible fuel source based on its combustion and polluting byproducts to generate hydrogen. This is little better than big oil’s life-intending business strategy to promote hydrogen fuel, that is, so long as hydrogen is produced from a base of fossil fuel sources.

Questions the County needs to answer and communicate to the public:

1. Why burn source materials that pollute the climate and our island environment to replace our fossil fuel dependencies?
2. Why spend more to trade-off of one dirty energy replacement for another (Hu Honua), when cost effective and clean pollution-free energy alternatives exist today?
3. Where is the true cost, energy efficiency comparison, and supply-chain risk analysis by this administration on which H2 assumptions have been formed, and in developing a transformative energy policy for Hawaii County?

Hawaii County’s energy assumptions also raises more questions, than provides answers:

• Should Hawaii County, or the state for that matter, invest time, resources, and money into nascent energy technologies with taxpayers dollars?
• Who are the outside forces driving the Mayor’s present H2 energy agenda?
• It is true that Blue Planet’s impressive H2 research facility at their Puu Waawaa Ranch has been influencing the County’s current energy policy and a roll-out strategy for H2 on Hawaii Island?
• Is it true Toyota has, for an undisclosed fleet price, offered H2 fuel Mirai sedans to the County?  It’s public knowledge that Toyota has been desperately looking for a high visibility H2 vehicle partner to assist the company in validating its highly criticized broken business case for favoring and building H2 vehicles over BEV’s.

It is easily argued that it is in the public interest that the County Council members should look into what the Mayor and his staff are planning and question the policy assumptions outlined in Robert Command’s November 15th email (below).

———- Forwarded message ———-
From: Command, Robert H <RobertH.Command@hawaiicounty.gov>
Date: Monday, November 15, 2021

The County of Hawaii supports a diverse portfolio of alternative energy producers, including Hu Honua. As we rid our island of horrible invasive species such as eucalyptus, albizia and ironwood, we create carbon sinks as we replace them with indigenous and endemic species such as koa and sandalwood. When no longer economically viable, energy from biomass will be phased out and morphed into technologies such as waste-to-energy. We also lower the risk of unintended consequences of cultivating these detrimental invasive species, which choke out native species and promote erosion.

Energy price fluctuations are naturally constrained by supply-and-demand economics when we have a diverse portfolio, including solar, geothermal, wind, hydroelectric and even OTEC. Uptick in prices, when spread over many producers, will be, for the most part, negligible. As we lower the demand for energy, prices are further depressed. One has only to remember the $2.43 per gallon for gasoline during the depths of the pandemic as an example of the effectiveness of laissez-faire economics.

All of these technologies, when coupled with the production and use of clean burning hydrogen, will focus us on our goal, which is 100-percent alternative energy production with a sustainable net-negative carbon footprint.

Mahalo

Bobby Command

Deputy Managing Director

County of Hawaii

Imagine an abundant green and nature-balanced island state, freed from its tourist dollar dependencies, powered by its home grown clean energy assets, sustained by a self-sufficient economy, and feed by its island-grown organic agriculture.

It’s a Hawaiian dream that can’t be brought or ordered online, and it’s a reality yet to be realized.  Hawaii’s unique history, location, and diverse population with a love and respect for the land and surrounding ocean habitat presents a pathway to Sustainability, as well as self-sufficiency.

Hawaii may even face fewer obstacles to achieve these lofty goals than most other parts of the world.  In the world of real estate it’s called … location, location, location.

As an island state there are advantages and disadvantages, but there is also the opportunity to more freely chart our own course without the baggage of mainland-connected interstate considerations.

This year’s Hawaii state legislature has many ambitious post-Covid plans and ideas. Some are fueled by community activists and special interests, but most share a general fatigue among legislators of living with too much pandemic talk, and too little economic certainty.

One example of this year’s legislative zeal, and a welcome change, is the recognition of the fundamental changes occurring globally and locally in the electrification of cars, SUVs, and trucks. With that, there is a corresponding awareness of the need for a statewide EV vehicle fueling infrastructure, and a replacement of imported fossil fuels with home-grown electricity.

Hawaii is currently in the middle of the pack relative to our peers in terms of electric vehicle market share.  We remain highly dependent on imported petroleum as our primary dirty and imported energy supply source across all sectors of the economy and island life. But that is changing, and perhaps faster than many can imagine.  By one measurement, this change is not lost on this year’s state legislature, who are presently considering more than 15 separate EV related bills — for legislative details visit: https://hawaiiev.org/2021-hawaii-ev-legislation

Electric Vehicles and more

Studies indicate that electric vehicles will begin to reach cost parity with their fossil fuel counterparts between 2025. Starting in 2030, it is estimated that 26 million EVs will be sold annually, representing 28 percent of the world’s new cars sold.

One of the primary drivers in the advancement of EVs becoming the “new normal” will be vehicle choices and EV specific features.  For one, technology advances. a wide array of electric vehicle choices is another.  Recently, GM committed to 100% EV production by 2035, Volvo by 2030, and Ford 2035 (most models).

Although vehicle cost is often sited as “the” primary factor in vehicle purchases, other factors play a primary role in deciding in car, suv, and truck purchases. Style, technology, and utility are also important factors in consumer purchase decisions. EV’s advantages are notable in offering vehicle owners a lower cost of ownership compared to conventional ICE vehicles.

Another factor helping along expand EV market share is a growing base of first time EV owners who after experiencing the low cost of EV ownership along with other benefits.  Recent data on EV second purchase trends indicate there is little chance first time EV owners will be returning to future ICE vehicle purchases …why go backwards.

Reinventing Hawaii’s transportation options goes beyond a transformation to electric vehicles.

Following a market wide trend, it is likely Hawaii in the next 20 years will be well into a phase-out of its gasoline and diesel vehicle dependencies. Such a change will demand the development of a multi-island fueling infrastructure for electrified and zero emissions vehicles transportation options.  However, individual EV ownership by itself will not carry the day for Hawaii’s zero emissions ambitions.  The integration of mass-transit systems and bike lanes into smarter island-urban designs will also be required to lessen Hawaii’s passenger car dependency, and provide for safe pedestrians options equal to their wheeled counterparts.

Energy

Eliminating the State’s imported fossil fuels dependencies has been a priority for Hawaii for more than 20 years. Beginning with a statewide goal to transition to 100% renewable energy by 2045. Back in the 1990’s, Hawaii’s legislators, some which will not be around to see the results of the far out policy results and foresaw a clean energy economy for the state. They placed faith in things  working themselves out over time in order to achieve the 100% renewable energy replacement goals.

Twenty-five years later, the state’s renewable energy goal now appears far too modest a timetable based on what we know now about increasing climate threats (local and global). Equally important, clean energy replacement options over the past 25 years have become abundant and cost effective alternatives to legacy fossil fuels options, and leading to the undeniable conclusion that Hawaii’s legislators’ foresight was more than just wishful thinking, but policy for a future which has now arrived.

Altogether, the state’s rapid transition off imported fossil fuels in a statewide shift to electrification is now being fueled by local and clean (zero emissions) power sources including rooftop and utility scale solar, wind, and coupled to power battery and pump energy storage options. This transition to clean and sustainable energy has proven not only practical, but desirable for ratepayers and the planet and necessary to the future of the state.

National Energy Policy Changes

The past four years of Federal energy policy has been marked by science denial, and a full speed in reverse to a 1950’s energy policy under the Trump administration.  A change in direction, like a breath of fresh air, has come to Federal energy policy level under the new leadership of President Biden and his administration.  With razor thin leadership margins in Congress, House Democrats last week introduced a revamped version of a major bill aiming to get the country back on the road to carbon neutrality by 2050.

“Today’s introduction of the CLEAN Future Act promises that we will not stand idly by as the rest of the world transitions to clean economies and our workers get left behind, and that we will not watch from the sidelines as the climate crisis wreaks havoc on Americans’ health and homes,” said House Energy and Commerce Committee Chairman Frank Pallone Jr.

The House Bill supports Biden’s stated goal of achieving a carbon-free power sector by 2035, and is 15 years more ambitious than the previous bill’s goal of a decarbonized power sector by 2050.   For a period of time, fossil fuel producers would be able to earn partial credits under the standard by lowering their carbon intensity, but the writing is on the wall for the world’s major polluters, fossil fuels will be eventually be phased out.

In the Senate, Democrats are retooling energy tax reform legislation that was first proposed two years ago but which failed to advance in a Republican-led Congress.

The Clean Energy for America Act could include technology-neutral incentives rather than wind- and solar-specific credits, and would aim to move beyond the current cycle of short-term incentive extensions to a more permanent approach, according to Bobby Andres, senior policy adviser to Democrats on the U.S. Senate Finance Committee.   “We’re actively working on updating that bill for reintroduction and very much view it as a cornerstone of the efforts on energy tax this Congress,” Andres said Wednesday at the virtual American Council on Renewable Energy (ACORE) Policy Forum.

Addressing sustainability and resiliency deficiencies; more than a goal, a necessity to Hawaii’s future

More than ever, Hawaii now needs to be resilient and ready for whatever climate-driven disasters come our way.  That beings with a founding principal that by becoming more resilient as a state, we undertake measures which also make us sustainable.

The coronavirus pandemic has only compounded the state’s supply chain dependencies, weakness, and vulnerabilities.  The pandemic also offered further evidence that the state of Hawaii, and Hawaii Island more specifically, must better prepare and ready itself for highly impactful scenarios or suffer the social, economic, and environmental consequences of willful neglect.

A path to sustainability and resiliency (often thought of as separate problems to be solved) are both in fact linked, and require both the state and country governments to undertake of key policy changes, beginning by reducing a present statewide dependency on imported foods: e.g., developing an encompassing local agriculture system, from farm-to-fresh and cold storage to consumer.

By products of such measures are the creation by necessity, and not just for policy sake. Local growth of job opportunities are core components of a self-sufficient and sustainable economy.

* Hawaii Emergency Management Agency

Hawaii’s Supply Chain Dependencies*: cascading effects of catastrophic events.

How long could the Big Island or Hawaii in general last if we were cut off from outside food, oil, medical supplies, and manufactured goods?  The sad answer is that vital supplies would run out in 5 -8 days, and less time for the neighboring islands of Hawaii, Maui and Kauai.

• Importation of 90% of market goods, 100% of some products
• Long, complex supply chain, up to 14 days to reach market in normal conditions
• Single points of failure / no redundancy in port capabilities
• All major logistic ports are in same general locations and exposed to the same threats
• Air cargo supplies approx. 1% of total cargo importation Ports and logistics system move over 14 million tons / yr., off load rate at 42 containers / hr., 3000 tons of food products / day move through the logistics system
• Loss of importation due to port closure for protective measures 48 hours prior to events in some cases Rapid depletion of market capacity when sea port closes
• Rapid depletion of market capacity and critical supplies when Hawaii Island commercial sea ports Hilo (east side) and Kawaihae (West side) are closed or services disrupted.

Hawaii’s Supply Chain Vulnerabilities*: on hand supplies and resources.

• Capacity – based in on-demand warehousing, not in replenishment of surplus
• No Surplus warehousing of supplies = no emergency surplus
• FOOD/WATER: 5 – 7 days in the state after port closure; after 5 days no importation = 40% of market capacity
• EMERGENCY SHELTER & SYSTEM: Supply cannot meet the demand, limited number of hardened shelters
• MEDICAL: 3 Days of general supplies, 7 days of pharma, general WF shortage, high operating capacity
• FUEL: Several single points of failure in the system; 100% reliance on importation through sea logistics chain
• ELECTRICITY: Not a mutually supporting system, 60% power plants in /on inundation zones, limited inventory of components (example: Hawaiian Electric North Kona power plant).
• PORTS: No large scale salvage / dredging equipment (7-10 day arrival time), alternate port concept not fully realized, airports w/ 4 days of fuel, low cargo capacity vs. emergency delivery