Hawaii Island Energy Co-op ‘Better, Faster & Cheaper’

Big Island electric customers are estimated to save much more money with the Hawaii Island Energy Cooperative (HIEC) than they are promised with the proposed sale of the Hawaiian Electric companies to NextEra Energy.

Read more below, as well as in the Hawaii Tribune-Herald, Pacific Business News, and in the Hawaii Star-Advertiser (behind their paywall).

The difference in the business model of a co-op model, such as HIEC, is that it’s non-profit. At a for-profit utility, such as NextEra, revenue goes to shareholders. That’s not the case with a non-profit co-op, and that’s one reason for the significant savings.

Also, co-ops, by definition, cooperate. HIEC can call up the electrical co-op on Kaua‘i, and they will share information. Hawai‘i Island’s co-op can call up the national headquarters and they will share information. Avoiding mistakes saves money.

It’s all very practical. The co-op model is a better model to help ratepayers prepare for the future.

Hawaii Island Energy Cooperative’s Press Release:

Hawaii Island Energy Cooperative would deliver transformation better, faster and cheaper

(HILO, HAWAII, DECEMBER 9, 2015)—Conversion of the electric utility on Hawaii Island to a nonprofit cooperative is expected to deliver greater savings than those promised with the proposed sale of the Hawaiian Electric companies to NextEra Energy of Juno Beach, Florida.

Hawaii Island Energy Cooperative (HIEC) analyzed financial information filed by the Hawaiian Electric companies (HE) and NextEra Energy (NEE) with the Hawaii Public Utilities Commission (HPUC).

By lowering the cost of capital, eliminating federal income taxes and the profit margin built into Hawaii Electric Light Company’s rates, the financial analysis found that Big Island customers could save as much as $113 million on the existing HELCO rate base and up to $234 million including investments to modernize the grid over a four-year period. This compares to $60 million in savings estimated by NEE for customers on all five islands served by HE over a four-year period.

In proceedings now being held on the proposed sale by the HPUC, NEE has asserted that the primary question the Commission should ask itself is whether the customers of HE and the State of Hawaii are better off with or without the sale going through.

HIEC has argued that the Commission should also consider the merits of the cooperative ownership model for Hawaii Island.

In addition, HIEC makes the case that a cooperative has the ability to accelerate the island’s clean energy transformation faster and with more focus than a mainland-based investor-owned utility.

“For Hawaii Island, the reality is that the 190,000+ residents of the island would be better served by a cooperative. Beyond the lower cost of capital and the lower electric bills that follow, the benefits of a coop include local, democratic ownership and control of one of the most important infrastructures on the island,” said Marco Mangelsdorf, HIEC director and spokesperson.

Other advantages of the cooperative business model

■ HIEC would be able to access low-cost debt capital.

• Traditional cooperative lenders include the U.S. Department of Agriculture, Rural Utilities Service, National Rural Utilities Cooperative Finance Corporation (CFC), and Co Bank.

• The combined borrowings of electric cooperatives from these sources is over $85 billion.

■ The cooperative network of 900 utilities has equivalent, and perhaps better, buying power and economies of scale for technology, administration, pensions and insurance. Many companies that support the cooperative program, including CFC and CoBank, are owned by their electric cooperative customers.

• National Rural Electric Cooperative Association provides a multi-employer pension plan on behalf of electric cooperative employees that is fully funded.

• Through national programs the electric cooperative network has led the utility industry in the deployment of smart grid technologies.

■ Cooperatives can be more nimble and quick in integrating more and cost-effective renewable energies. Emulating the example of Kauai Island Utility Cooperative (KIUC), HIEC should be able to move faster to provide the advantages of renewable energies to Hawaii Island consumers.

• KIUC has gone from approximately 10 percent renewable in 2011 to almost 90 percent during prime sun hours today through a portfolio of utility-scale solar, biomass generation, distributed solar and legacy hydropower.

• KIUC’s smart grid initiative, which enables customer choice and is a key to the efficient integration of renewable energy, was completed nearly two years ago.

•Over the past two years, KIUC has built the two largest solar arrays in Hawaii, generating electricity cheaper than similar arrays proposed on Oahu. As well, KIUC is in the approval process for the nation’s first utility-scale solar array with dispatchable energy storage, moving solar energy to the nighttime hours and displacing millions of gallons of oil.

Noted HIEC president Richard Ha, “HIEC is able to focus on only our Hawaii Island and its unique needs, desires and resources. The single island focus and urgency created by a customer-elected board of directors to set the strategy is KIUC’s greatest strength and the reason they have been so successful in the transformation of their island’s utility system.”

About Hawaii Island Energy Cooperative:

HIEC is a non-profit cooperative association that seeks to establish a member-owned electric utility and encourage non-petroleum-based transportation for Hawaii Island. HIEC presents a unique opportunity for all electricity consumers to “Own the Power.” For more information, visit www.hiec.coop. HIEC is on Facebook and Twitter @HiEnergyCoop

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Whiteboard Animation: The Electric Cooperative Story

This short whiteboard animation explains really well just what an electric cooperative is and how it works. The 3-and-a-half-minute video is well-worth watching.

You’ll see how electric co-ops started in this country, back during the Roosevelt era when farmers and ranchers put in $5 each for membership and equity in a cooperative to bring electricity to their rural areas.

And you’ll see how the not-for-profit electric co-ops operate in ways that really align with how we think and live here in Hawai‘i. Members elect local directors to represent them. Co-ops work with other co-ops (they cooperate) for financing and research, to help after storms, and other times when needed. Profits are returned to members.

A co-op model is also better positioned to accomodate zero or negative economic growth than an investor-owned model.

Forty-two million people in the U.S. currently get their electricity through an electric co-op.

With a co-op model as our electric utility, we would not be all by ourselves. There’s no need to worry that it would just be us out here against the world.  Watch this short video and you’ll see there is a robust association of more than 900 co-ops in the U. S., all helping each other. No one is left behind.

Honoring Their Memories

Richard.serviceWe were so young. I was 25 and I was actually one of the older soldiers, because I went to Officer Candidate School.

That year changed me forever. The unspoken rule was that we all came back or nobody came back. Everybody came back from Vietnam, but some didn’t come back alive. This is where I learned that it’s about all of us, not just a few of us.

It is in honor of their memories that I believe in the rule of law of the U.S. Government.

Look What the Kauai Island Utility Co-op Did

We went to Kaua‘i on Saturday to attend the blessing of the Kaua‘i Island Utility Cooperative (KIUC) Anahola Solar Array.  The mood was one of exhiliration and great pride. Here’s a short video clip.

Richard Ha Hamakua Springs
The 60-acre photovoltaic system, coupled with a six-megawatt lithium-ion battery system, was a collaboration between KIUC and Anahola Hawaiian Homes. It will generate clean energy on the island as well as decrease fossil fuel imports from the mainland. The system will generate 20 percent of the island’s annual energy needs during the daylight hours, and will save nearly $250,000 a month on operating costs alone.

Richard Ha Hamakua Springs

I met many of the directors and key people involved in KIUC over the years. Key members of the Hawaiian community were in attendance, as well.

Richard Ha Hamakua SpringsIt is amazing what KIUC has been able to accomplish in a short time. Its costs have risen the least of all the electricity producers in the state despite its having the least number of available options. It does not have geothermal, for instance, and cannot use wind power due to bird kills.

Richard Ha Hamakua SpringsIt goes to show what a lean and mean utility co-op can accomplish.

Comparing Electricity Rates for HECO & Kauai’s KIUC Customers

It’s interesting to look at this chart and compare what electric rates have looked like for Hawaii Electric Company (HECO) customers compared with prices for Kauai Island Utility Cooperative (KIUC) customers over the same period.

KIUC’s electric rates have been all but flat from 2008 to 2014, while rates for the HECO companies have gone up from 4.4 percent to a whopping 28.3 percent.

ELECTRIC RATES 2008-2014 Jun-08 Jun-14 % Chg
   KIUC  $                       439.39  $                          440.00 0.1%
   HECO-Oahu  $                       280.53  $                          359.90 28.3%
   HELCO-Hawaii  $                       395.09  $                          425.80 7.8%
   MECO-Maui  $                       374.35  $                          391.00 4.4%
   MECO-Lanai  $                       426.87  $                          470.00 10.1%
   MECO-Molokai  $                       416.32  $                          480.00 15.3%

Diagnosing Our Electricity Situation

This blog post by Gail Tverberg, Our Electricity Problem: Getting the Diagnosis Right, clearly explains what is going on in the world today and makes it easy to understand some things that seem counterintuitive at first glance.

She write about the oil price drop, and, recently, the economic slowdown. That’s the counterintuitive bit – you’d think with the drop in the price of oil, the economy would be picking up.

I have followed Gail’s analyses for a long time now. What she explains in this blog post is something she’s been predicting, and talking about, for quite awhile.

And here’s the thing – she’s been right on the mark for as long as I’ve known her. She is more doom and gloom about it than I am, but then I have never been able to prove her wrong. So it’s best to be prudent and try to protect ourselves as much as we can.

It’s why I’m pushing the utility co-op. An investor-owned electricity utility would just take us farther down the same old path in the wrong direction.

With a co-op, we are in control of our direction and our destiny. We would manage it ourselves; it would not be managed by people whose end goal was trying to make a dollar for investors. This is what I see as the basic difference between the NextEra plan and ours, and it’s a huge one.

We need to control our direction in order to take care of ourselves, and even more importantly so our kids and grandkids and their grandkids will be able to adapt to changing conditions and take care of themselves. The future is not going to look like, or work like, the past.

Go read Gail’s blog post, where she makes that easy to see. Things are already different, on many levels, and we need to be doing our long-term planning now. It’s like my Pop taught me – we plan for the future by taking small steps now so that later we don’t have to take drastic, catastrophic steps just to survive.

We have to take care of all of us, not just a few of us.

Those survival lessons I learned from my Pop were simple, and it’s time to put them into play.

If Gail’s wrong about how bad it will get, that’s okay. No harm, no foul. But if she’s right, we’ll have done the right thing. Either way, we will have protected ourselves.

GMOs Are Safe & We Need National Labeling Standard, Says Senate Committee

At a public hearing held Wednesday in Washington, D.C., Senators from both parties spoke about the “overwhelming scientific consensus regarding GMO safety,” and about the urgent need for Congress to pass a nationwide solution that prevents a “state-by-state patchwork of labeling laws” that has poor consequences for farmers, businesses, and consumers.

From the Coalition for Safe Affordable Food:

In a major step towards passage of a uniform, national labeling standard for foods made with genetically modified organisms (GMOs), the Senate Agriculture Committee held a hearing today that showcased the overwhelming scientific consensus regarding GMO safety, as well as the urgent need for Congressional action to pass a reasonable, common-sense solution that prevents a state-by-state patchwork of labeling laws.

“Today’s hearing confirmed that GMOs are safe; a state-by-state patchwork of labeling laws will have dire consequences for farmers, businesses and consumers; and the urgency for Congress to prevent these problems by passing a uniform national law,” said CFSAF spokesperson Claire Parker.

Senators from both parties spoke to the importance and safety of biotechnology and the need for a single national food labeling standard. Chairman Pat Roberts (R-KS) began the hearing by stating that “agriculture biotechnology has become a valuable tool in ensuring the success of the American farmer in meeting the challenge of increasing yield in a more efficient, safe, and responsible manner.”

Ranking Member Debbie Stabenow (D-MI) declared “I share the concern of doing business if 50 different states have 50 different standards and quite frankly, it wont work.” Senator Stabenow also said she hopes the Senate can “work together to develop a bipartisan bill that can pass the Senate by the end of this year.”

Wednesday’s hearing began with a panel of experts from the U.S. Department of Agriculture, Environmental Protection Agency, and the Food and Drug Administration offering testimony that reaffirmed the safety of GMOs.

Dr. Susan Mayne, director of the FDA’s Center for Food Safety and Applied Nutrition, stated that “over the last 20 years, FDA has reviewed and evaluated data and information on more than 150 GE plant-derived foods…based on our evaluations, we are confident that foods from genetically engineered sources in the U.S. marketplace today are as safe as their conventional counterparts.”

Michael Gregoire, the associate administrator of the Animal and Plant Health Inspection Service of the U.S. Department of Agriculture, added, “we have great confidence in the safety of GE crops that have been approved under the current U.S. regulatory system.”

Following three hearings in the U.S. House of Representatives, this is the fourth time in the past 12 months where expert witnesses have confirmed the science and safety of biotechnology.

The Senate hearing comes less than ten months from the July 1 effective date of Vermont’s labeling mandate, which will be the first state to implement its own unique food labeling standard. Though Vermont’s law is currently being challenged in federal court, there is little chance of a judicial resolution in time to prevent the negative impacts of the misguided statute.

Joanna Lidback, a dairy farmer from Barton, Vermont, provided a first-hand account of the severe consequences that will ensue should Vermont’s law take effect next year. “The use of biotechnology on our farm is also important to the economic sustainability of our small business by keeping the price we pay for feed affordable,” said Lidback. “To compare prices, a non-GMO basic 20 percent protein complete feed would cost $555 per ton; the same conventional feed that we purchase is currently $305 per ton…a difference of $4,000 a month or $48,000 per year. I do not see how we could profitably farm in the long term with those increased costs, thus effectively pushing my small farm out of business.”

Daryl Thomas, executive vice president of Herr’s Snacks, testified that a patchwork of state labeling laws will cost his company more, likely leading to higher prices for consumers. “Absent a federal solution by July 2016 when Vermont’s law takes effect, manufacturers will have three options to comply: 1) redesign packaging, 2) reformulate products so that no label is required, or 3) halt sales to that state,” said Thomas. “While we have not made a final decision, we are considering several factors that will make it difficult to continue sales in Vermont. One factor is the ability of our distributor chain to segregate product for Vermont since it is the food manufacturer who is liable if mislabeled products make it onto store shelves. We recently received a note from the largest grocery wholesaler in the nation. The letter informed us that they ‘will not take additional steps to segregate or otherwise specifically direct the shipment of Vermont only products into Vermont.’”

“Discussions about mandatory GMO labeling laws reducing consumer choice are becoming much less theoretical and much more real,” Thomas continued. “If the number of products on store shelves decreases, not only will consumers lose choices, but the lack of choice and competition could drive up costs. For some households that cost might be easily absorbed. For others it could be significantly more difficult.”

It it increasingly clear that a bipartisan solution is attainable. In July, the House of Representatives passed its own bill that creates a single, national labeling standard, as well as a GMO-free certification program that assures consumers who prefer to purchase non-GMO foods have a consistent, transparent means of identifying those products. That legislation passed by a 275-150 vote with support of 45 Democrats. Today’s hearing provided plenty of evidence that similar bipartisan compromise is within reach in the Senate.

President Obama Announces Kamaaina Observatory Experience at Mauna Kea

It’s an honor for the best telescope in the world to be sited on our Maunakea. And it’s very appropriate for the President of the United States, a local boy, to highlight the great contributions of our astronomy sector. It’s also very appropriate that some of our voyaging people from the Hokule‘a were present when he acknowledged those contributions.

This is the spirit of “Not, no can. Can!!”

These are the things that Hawaiians are noted for!

“This is an extremely exciting time, with President Obama’s announcement underscoring the significance of Maunakea and Hawaii to astronomy,” said Henry Yang, Chair of the TMT International Observatory Board. “TMT is honored to be a part of Hawaii’s astronomy community. We remain committed to integrating science and culture, providing the best possible stewardship of the mountain, and enriching the local community through education and outreach programs.”

Free Monthly Community Event to Welcome Hawaii Residents to the Maunakea Observatories

The Maunakea Observatories and Imiloa Astronomy Center announced the Kamaaina Observatory Experience, a monthly community event that welcomes Hawaii residents to the science reserve atop Maunakea to see world-class telescopes and learn about the cultural and environmental importance of the mountain.Hamakua Springs

The Kamaaina Observatory Experience was introduced yesterday in a speech by President Barack Obama at the White House Astronomy Night in Washington, D.C. The event, held on the South Lawn of the White House, brought together scientists, engineers and visionaries from astronomy and the space industry, including guests from Hawaii’s Imiloa Astronomy Center, Gemini Observatory and the Polynesian Voyaging Society, who shared an evening of stargazing and learning with students and teachers.

“We were honored to represent Hawaii’s tremendous contributions to the world of astronomy, education and culture on the White House lawn tonight,” said Kaiu Kimura, executive director of Imiloa Astronomy Center. “As part of Imiloa’s partnership with the Maunakea Observatories, we look forward to sharing these contributions with even more of our friends and ohana at home in Hawaii through the Kamaaina Observatory Experience.”

Hamakua Springs The new program will occur once a month and will include transportation to and from the summit and the Visitor Information Station, a cultural briefing, a one-hour safety and environmental briefing at Hale Pohaku, and a one-and-a-half hour visit to two of the Maunakea Observatories-the most scientifically productive collection of telescopes on earth. Participation will be free of charge and open to all Hawaii residents.

“The Kamaaina Observatory Experience will be the first program of its kind in the 50-year history of astronomy on Maunakea,” said Doug Simons, executive director of the Canada-France-Hawaii Telescope (CFHT). “The Maunakea Observatories make Hawaii one of the most respected sites on earth for astronomical discovery. It is our sincere hope that this program will inspire a passion among kamaaina for astronomy and an appreciation for the cultural and environmental future of Maunakea.”

Participating Maunakea Observatories in the program will include the CFHT, Gemini Observatory, the James Clerk Maxwell Telescope (EAO), NASA Infrared Telescope Facility, Subaru Telescope,
Submillimeter Array, the W.M. Keck Observatory, and in the future, the Thirty Meter Telescope.

The Kamaaina Observatory Experience will launch in early 2016 and will be open once a month to individuals 16 and older with a valid Hawai’i ID. Registration is required and will be available online on a first come, first served basis.

For more information about the Kamaaina Observatory Experience and to reserve a spot for an upcoming tour, visit www.kamaainaobservatoryexperience.org.

White House photo CC BY-SA 3.0 

Remembering My Pop’s Values

The Grassroot Institute of Hawaii invited me to speak the other day. Grassroot Institute President Keli‘i Akina told me he’d been following my writing and thinks some of our values align.

Richard Ha Hamakua Springs
The format was that of a Q&A. Members asked me for my thoughts about the Thirty Meter Telescope and the protest, for instance. I think that not compromising is a difficult position to take, I told them, because then you’re not adaptable to the future.

Richard Ha Hamakua Springs

They asked me about GMOs, and I told them what I have said before: just because science can detect gold in seawater doesn’t mean you would invest in a gold mine in Hilo Bay. You’d lose money. The pluses have to exceed the minuses, or else you have to go do something else. There’s no free lunch. This is true for organisms, organizations and civilizations.

Richard Ha Hamakua Springs

I told them I welcome change, and that my strategy is always to look 10 years to the future and plan for that. My thinking is that you have to make small changes along the way, so you don’t need to make catastrophic and often impossible changes at the last minute. That’s the difference in short-term vs. long-term thinking. This isn’t anything new; it’s what my Pop taught me when I was 10 years old. Though there were some years after that when I was smarter than my parents, I said, but then I got back to it.

Richard Ha Hamakua Springs

I told them that by quoting my Pop, I don’t have to remember what I said yesterday, and everybody laughed.

  • Not no can, can!
  • Get thousand reason why no can. I just looking for the one reason why can.
  • Find two solutions for every problem and one more just in case.
  • Just because science can detect gold in seawater doesn’t mean you would invest in a gold mine in Hilo Bay. Lose money.
  • The pluses have to exceed the minuses or you have to go do something else.
  • There is no free lunch. That is true for organisms, organizations and civilizations.
  • If you look outside your front porch and you see lots of rubbah slippahs, you are a rubbah slippah person.
  • Plan for the future so you can make small adjustments as you go instead of one big painful decision when you no more time.

I’ve also added a couple more things:

  • Two-thirds of the economy is made up of consumer spending. If the folks on the lowest rungs of the economic ladder had extra spending money, they would spend and everyone would benefit. I call that “trickle-up economics.”
  • We all come back or no one comes back. That was the unwritten rule in Vietnam and it influenced me a lot in later years. It became that it’s about all of us, not just a few of us.

Richard Ha Hamakua Springs

Somebody came up to be afterward and said, “Farmers are so grounded.” He said something I think is right on target – that it’s not about the details, because you can get technical people to work on the details. It’s about planning for the future.

My Pop only went to the sixth grade but he was very practical and he knew about survival. He taught me most of what I needed to survive in this world.