Tag Archives: Hawaii Electric Light Company

Biofuel, Lowering Electric Rates

My Star-Advertiser Op-Ed: Big Island Biofuels Project Would Raise Oahu’s Electric Rates

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My Op-Ed article on the Aina Koa Pono situation, and how it would raise electricity rates for O’ahu residents (though the project is on the Big Island), ran in yesterday’s Star-Advertiser. Here it is in full:

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The Public Utilities Commission (PUC) is considering approving
a contract between Hawai‘i Island’s HECO-owned utility (HELCO) and a partnership known as Aina Koa Pono (AKP). Its decision is expected within the next several weeks.

Why should rate payers on O‘ahu care about this proposed
contract?

Because if approved, O‘ahu residents would pay about 90
percent of the cost – even though the very expensive fuel would only be used on the Big Island.

The contract between HELCO and AKP calls for HELCO (and you) to purchase fuel from AKP at about $200/barrel. Today, a barrel of oil costs about half that: $107.  If this contract is approved, there will be a surcharge, to cover the difference, on your monthly electricity bill.

Furthermore, note that whenever oil has reached about $120/barrel, world economies have slowed precipitously. Many have gone into recession. This tells us that there is a natural economic “stop” in place that keeps oil from getting anywhere near $200/barrel.

And yet HELCO/HECO is trying to guarantee AKP a fixed price
of $200/barrel.

While a discussion of using renewable energy, rather than
primarily buying foreign oil, is warranted, when the cost of those renewables is so unrealistically high that any buyer would look for other alternatives, then that discussion has reached the point of absurdity.

What lower-cost alternatives exist for the Island of Hawai‘i?

  • The Island has significant geothermal resources at the equivalent price of $57/barrel. Right now, HELCO purchases only about 70 percent of the geothermal power available, meaning there is more geothermal available at well below the equivalent of $200/barrel.
  • HELCO currently purchases power from biofuel and hydroelectric sources that make a reasonable profit at today’s prices, and don’t ask for $200/barrel. Additional power plants are asking to come on line at today’s prices.
  • HECO and HELCO currently buy solar power at prices well below the equivalent of $200/barrel (in fact, from what we can tell, at less than half that price).
  • HECO and HELCO buy wind-generated power for far less than $200/barrel, with more potential sellers lining up to sell to them.

AKP’s plan has technical issues, as well. The process AKP plans to use has never been proven at the scale they propose; the proposed
yield of source material is many times more than ever grown anywhere. There are also cultural and environmental issues.

Finally, you might ask why O‘ahu rate payers should pay for power consumed by rate payers on another island. GOOD QUESTION.

The simple answer is that if rate payers on the Island of
Hawai‘i had to bear the burden, there is no way this could be approved. That kind of tells the whole story right there, doesn’t it?

We suggest you write to the PUC if you oppose this contract:
hawaii.puc@hawaii.gov. You can also contact your State and County legislators and your Mayor.

Richard Ha, owner of Hamakua Springs Country Farms,
submitted this on behalf of the Big Island Community Coalition, of which he is a founding member. Other founding members include Dave DeLuz Jr., John E.K. Dill, Rockne Freitas, Wallace Ishibashi, Ku‘ulei Kealoha Cooper, Noelani Kalipi, Ka‘iu Kimura, Robert Lindsey, H.M. “Monty” Richards, Marcia Sakai, Lehua Veincent and Bill Walter. All operate as individuals and do not represent others. The Big Island Community Coalition (BICC) works primarily with cost issues on the Island of Hawai‘i, where residents pay about 25 percent more for electricity than do O‘ahu rate payers.

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Big Island, Community, Lowering Electric Rates

PUC: Here’s When You Can Show Up & Make a Difference

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Richard Ha writes:

If we show up in huge numbers at PUC hearings, we can make a difference.

The PUC will hear HELCO’s proposal for a 4.2 percent rate hike, as well as about Aina Koa Pono’s proposed biofuel project, on:

  • Monday, October 29, 2012 at 6 p.m. at the Hilo High School cafeteria, and
  • Tuesday, October 30, 2012 at 6 p.m. at the Kealakehe High School cafeteria.

The Big Island Community Coalition opposes both proposals because they would raise, rather than lower, our electricity rates.

The PUC members are caring human beings. But they have to know what the people want. Only two people, I think, showed up at the last PUC hearing in Hilo. We need hundreds!

The Big Island is in trouble. We have one of the highest electricity rates in Hawai‘i – almost 25 percent higher than O‘ahu’s.

High electricity rates are like a giant regressive tax, only worse. As people leave the electric grid to escape its high cost, those who cannot afford to do so pay even more.

The Big Island has a robust supply of alternatives to oil. We need to mobilize and make meaningful change.

The world has been using twice as much oil as it’s been finding for 20 to 30 years now, and this trend continues.

Growing gap

In the last 10 years, the price of oil has quadrupled. Something significant has changed: This has never before happened in the 150 years comprising our “Age of Oil.”

Oil price quadrupled

In China, they use two barrels of oil/person/year, and even when oil costs $100/barrel, their economy continues to grow. Here in the U.S., we use 23 barrels of oil/person/year, and at $100 oil, our economy is sputtering. It is reasonable to assume that the price of oil will continue to rise as it continues to be influenced by China’s demand.

Who here is most vulnerable to rising electricity costs?

  • Senior citizens on fixed income, for one, who sometimes have to make choices between food, medicine and electricity. We cannot leave our kupuna – our moms and dads, grandmas and grandpas – out there to fend for themselves. These are the ones who sacrificed so we could have a better life.
  • Single moms are also very vulnerable. I talked to a person who has several kids she hopes to send to college. She told me the threat of rising electricity prices weighs on her every day.

According to this week’s Hawaii Tribune-Herald, 3,000 of the 10,000 folks in Hawai‘i who receive federal aid to help pay their electric bill are on the Big Island. We have less than 15 percent of the state’s population, yet more than 30 percent of Hawai‘i’s residents who receive federal assistance to pay their electricity bill are on the Big island.

Join the Big Island Community Coalition to receive an occasional email telling you how you can help bring down the cost of Big Island electricity.