Tag Archives: Hawaii

Peak Oil, Renewable Energy Sources

HECO Starts TV Ads Explaining Increasing Electricity Rates

In an article in yesterday’s Honolulu Star-Advertiser, Hawaiian Electric Company (HECO) Vice President Robbie Alms talks about how current increases in electricity rates are due to forces beyond our control, and says that customers should “brace for an extended period of high electricity prices.”

The article mentions that HECO is starting to run educational spots on TV to explain what is going on.

HECO sees electric prices staying high

The utility will begin airing TV ads tonight explaining reasons behind the rate hikes

By Alan Yonan Jr.

POSTED: 01:30 a.m. HST, Dec 23, 2011

Hawaiian Electric Co. is launching its first-ever public awareness campaign telling customers to brace for an extended period of high electricity prices.

Electric rates on Oahu have hit record levels in four out of the past five months largely due to an unprecedented hike in the cost of petroleum-based fuel, which the utility burns for more than 75 percent of its electricity production. Read the rest

I’ve been to four Peak Oil conferences now. During the first, in 2007, I learned that the world had been using twice as much oil as it had been finding for the past 20 years (and that trend continues). Ever since, I have been trying to educate folks so we can transition to more sustainable energy sources in an orderly manner.

At the time, one could not tell if the leveling off of oil production since 2005 was the beginning of a trend or not.

By 2009 though, at the time of the Peak Oil conference in Denver, we could see that the leveling off of oil production continued. At that time, I started paying attention to an idea that Professor Charles A.S. Hall called Energy Return on Energy Invested (EROI).

The idea: It is the net energy, resulting from the effort to get that energy, that is what society can use. The more difficult it is to get oil in its final usable form, the less net energy that’s available for society to use.

By 2010, Lloyds of London had issued a white paper alerting its business clients to be prepared for $200/barrel oil by 2013. By then, it was generally agreed that oil fields begin, peak and decline in a bell-shaped curve. And the decline rate of all the world’s oil fields could be estimated to within reasonable limits, say between 3 and 6 percent.

So the natural decline rate would be between 2.5 and 5 million barrels/day each year. Since Saudi Arabia produces 10 million barrels per day, we would need to find the equivalent of a Saudi Arabia every four years. Or, in the worse case scenario, every two years.

Renewables would have to fill that amount just for us to stay even.

Somewhere along the way, I picked up that our world economy is about manufacturing – building or making things – and that takes energy. But if the primary source of energy is not increasing, could it mean that the world economy cannot grow? It sounds plausible.

By this most recent Peak Oil conference, in October – and as recent events are starting to show – it looks like there is a fundamental change occurring in the oil market. Normally, one would expect to see the price of oil declining in a recession. But something different is happening: Oil costs close to $100 per barrel.

In China, the per capita usage of oil is around 2, while in the U.S. the per capita usage is around 26. At $100/barrel oil, China’s economy is still growing. The upside of this is that we have a cushion.

If oil supply is not able to keep up with demand, it seems reasonable that the price of oil will be rising. If this results in higher gas and electricity costs, it will put a drag on consumer spending, two-thirds of which affects economic growth.

The EPA is requiring upgrades to oil-fired plants, which will cost ratepayers even more.

It feels like we will be starting down the backside of the oil supply curve soon. And as it becomes more difficult to get oil, the net oil available to society will be less and less.

We in Hawai‘i are so lucky to have geothermal as an option for base power electricity, which is 80 percent of our electricity use. Geothermal is proven technology, environmentally benign and it’s affordable: Geothermal-generated electricity costs less than half that of oil at today’s price, and the cost will stay stable for 500,000 to a million years.

As the price of oil rises, and if we rely on affordable geothermal for a large portion of our electricity base power, our economy will become more competitive compared to the rest of the world, and our standard of living will rise. Our farmers and food manufacturers will become more competitive and Hawai‘i will become more food secure. Our young people will be able to find jobs at home.

I saw the first of the new HECO television spots a short time ago. Congratulations to HECO for starting them. There is a huge amount of catching up to do. It will be a challenge.

If we move urgently toward affordable energy, we will strengthen our Aloha way of life – where people aloha and take care of each other. Together we can make a better tomorrow for all.

Happy Holidays!

Geothermal, Iceland

About the “Broken Economy that got out of Jail”

1 Comment

This article about Iceland and its ongoing recovery from the financial crash of 2008 was written a month after Roald Marth and I visited Iceland in August 2011.

The Independent

Iceland: The broken economy that got out of jail

The small nation went bust spectacularly. But its recovery has been remarkable, too – and holds lessons for other countries. Ben Chu reports

Iceland experienced one of the most severe recessions in the world when the markets crashed in 2008. Economic output fell by about 12 per cent over two years. But the latest report on Iceland by the International Monetary Fund shows that growth is resuming. GDP is expected to increase by a relatively healthy 2.5 per cent in 2011. The Icelandic public finances are on a sustainable path too with government debt projected to fall to 80 per cent of GDP in 2016.

The turnaround should not be exaggerated. Iceland is still more than 10 per cent below pre-crisis output levels. Unemployment remains at about 6.7 per cent, considerably higher than before 2007. The standard of living of most Icelanders is well down. Access to foreign currency is tightly controlled. And risks to recovery remain. Central bank interest rates are going up in order to curb inflation. This could stifle growth. Yet the fact remains that the outlook for the Icelandic economy is looking rather healthier than other distressed economies in Europe such as Greece, Portugal and Ireland…  Read the rest

Iceland experienced the biggest financial crash in modern history – yet they are now recovering. They are recovering because they inoculated themselves from high oil prices by using low cost hydro and geothermal for 100 percent of their electricity and house heating. And by utilizing low cost electricity, they made an electricity intensive aluminum export industry.

It is clear to me that had they used expensive biofuel to generate electricity, they would not be competitive in making aluminum for export. And instead of coming out of this disastrous financial situation, they would be facing years of depression. This is exactly why Hawai‘i should not be using expensive biofuels to make electricity when we have low-cost geothermal.

Here are my observations from that trip we took took to Iceland.

I want to conclude my “Iceland Series” by pointing out something very simple and straightforward that they have learned in Iceland and put into practice, but that we in Hawai‘i have not:

Cheap and proven technology, and clean energy projects, protect an economy from oil crises. Read the rest

Geothermal, Peak Oil, Renewable Energy Sources

Momentum Toward Geothermal Has Shifted

It is clear that the momentum toward geothermal has shifted.

There have been numerous community meetings on the Big Island, where the overwhelming number of Hawaiians are in favor of geothermal if it is done in a pono way: It needs to be culturally sensitive and benefit the community, and before we implement geothermal, it must be shown that its use is environmentally benign.

People on the Big Island are very aware that geothermal electricity is much cheaper to produce than oil- or biofuel-generated electricity. They expect to see a difference on their electric bills.

This major change will be very challenging for the electric utility as it tries to translate geothermal production into lower electric bills. But they have the best people working for them; they are our friends and neighbors. Actually, they are us.

Not, no can. CAN!

Water

New Info About Hawaii’s Water

This morning I talked to Dr. Don Thomas for half an hour. He’s finding really fascinating stuff that turns upside-down the whole theory of how fresh water is stored under the island.

It looks like there is a 15-foot thick, impermeable, layer on the Hilo side that traps freshwater 9,000+ feet down.

This is what we thought the Hawaiian Islands water cycle looks like.

Water

Clouds come in and pile up against the slopes, and then rain falls, percolating down and out toward the ocean. So when we drill, we expect to find a freshwater lens, with salt water beyond (lower than) the freshwater lens. Right? One would expect to find fresh water at roughly around sea level. Or maybe a little deeper.

What if you drilled past the freshwater lens into the salt water and found fresh water at a much deeper level – like 9000 feet? And what if it were cold, and more than 1000 years old and under 160 pounds per square foot pressure? That was what Don Thomas recently found at a well he was drilling by the Hilo airport.

What does this mean? Could it be the same on the Kona side? He thinks so.

Using magnetotelluric surveys — they detect radio waves in the earth, and, depending on the conductivity of the rocks, can give a hint at what is there (i.e., hot/cold rocks, salt/fresh water, or combinations thereof), and then he gets in there with his drill — he has found what looks like perched fresh water on the dry side of the island. And it was higher than expected. Hmmm!
Biofuel, Renewable Energy Sources

Compliments to Gov. Abercrombie for Selecting Wise PUC Commissioners

The PUC’s decision Thursday, which denied Aina Koa Pono’s biofuel contract with HELCO, is significant for several reasons.

To me, most significant is that the PUC is not going to let HECO force ratepayers to be the bridge financier.

Hawaii PUC denies HECO, Aina Koa Pono application

September 29, 2011 

HONOLULU, Hawaii: In a decision that was handed down today, the Hawaii Public Utility Commission voted to deny the HECO companies’ application for approval of the biodiesel supply contract with Aina Koa Pono, rendering moot the application to establish a biofuel surcharge to help cover costs. Read the rest

Farmers take the commonsense approach – We look for others that have solved the technical problems, and just copy. Save money, less risk.

Food Safety Certification

Hamakua Springs is Food Safety Certified

The farm had its external food safety audit yesterday.

“We don’t hear officially for a week or so, but I know we did pass,” said Tracy Pa, Richard’s daughter, who – among other responsibilities – handles the farm’s food safety certification process.

I asked her how she knows.

“Because the auditor couldn’t believe how clean our place was,” she said, “and how orderly the records are.”

There are two different audits – one for the farm, and another for the packing house. “It’s all about worker protection, safety and cleanliness,” said Tracy.

For the farm audit, she said, you even have to show documentation about what the land was used for before you got there.

“Everything has to be documented,” she said. “We are on land that was previously sugar cane land for 90-100 years.

“There’s a cleaning schedule for when to clean your harvest bins, you have to sanitize your knives every day before you use them, we wear disposable gloves when we’re working, and they’re discarded once they touch some surface other than the food itself. They take water samples and test the water quality.”

“These days pretty much everyone requires it,” she said, “like Costco requires it to sell anything to then, and more and more supermarkets, too.”

But back when the farm first received “Food Safety Certification,” in 2003, it was not the norm. “We were ahead of the game,” she said. “It was very unusual then, and everyone looked at us as if we were crazy because we were spending a few thousand every year to get audited. And it’s a lot of paperwork on top of whatever else we’re doing.”

It was primarily as protection for their workers that they started pursuing Food Safety Certification, which they received every year.

These days, “the employees are proud when we pass,” she said. “When it’s over and you tell them we did a good job, they give a sigh of relief.”

Articles, Food Security, Games, Renewable Energy Sources

Richard Ha at Civil Beat

Civil Beat asked Richard to write some opinion pieces for them, and his 3-part series on energy and food security in Hawai‘i is running right now. You can click the titles to read the whole article.

Part 1:

Trying to be Safe by Doing Nothing is No Longer Safe 

I am Richard Ha, chairman of the board of Ku‘oko‘a. Ku‘oko‘a is trying to align the needs of Hawai‘i’s people with the needs of the electrical utility.

I want to start by telling you who I am and what my values are. My mom is Okinawan, Higa from Moloka‘i, and my Pop was half Korean and half Hawaiian. His mother was Leihulu Kamahele. Our family land was down the beach at Maku‘u in Puna. We were very poor but didn’t know it….

 Read the rest

Part 2:

Expensive Electricity Threatens Hawaii’s Food Security

At the 2010 Peak Oil conference, held in Washington, D.C., a speaker pointed to a graph showing that oil is used for a very small portion of the U.S. mainland’s production of electricity.

He pointed out that Hawai‘i is responsible for a huge portion of the nation’s oil use. The U.S. mainland uses oil for less than 10 percent of its electrical generation, while Hawai‘i depends on oil for 76 percent of its electrical generation. So when oil prices rise, Hawai‘i’s electricity ratepayers are significantly more affected than mainland electricity ratepayers.

And as oil prices rise, any imported mainland product that has electricity usage imbedded in its production has a cost advantage over the same product produced in Hawai‘i. This is true for ice cream, bakery products and even jams and jellies….

Read the rest

Part 3:

What Works, Works

Farmers cut straight to the chase. We farmers are concerned about survival, the bottom line, people and the environment.

Although we do support maximizing other technologies available to us in Hawai‘i, here I am talking about “base power” electricity – stable, steady power. Eighty percent of our electricity needs to be stable, steady base power. Base power has the biggest impact on our electricity bills….

Read the rest

Peak Oil

Peak Oil Conference in November

In November, I will attend my fourth Association for the Study of Peak Oil (ASPO) conference.

I highly recommend that Hawai‘i people in decision-making positions attend.

This year’s conference theme is “Truth In Energy,” and it will focus on the importance of transparent and reliable energy information, and the need to educate influential leaders and the public on the peak oil energy challenges facing our nation.

Energy is a very complex subject, and it’s sometimes difficult to separate the truth from the marketing hype. The value I get from attending these conferences is in being able to determine the difference between the middle ground, the fringe, the hopesters and the hypesters.

For example, when I went to my first ASPO conference in Houston, a speaker pointed out that the peak of oil production in the U.S. occurred in 1970. Although Saudi Arabia keeps their oil reserve data secret, there are ways that regular folks can make reasonable assumptions. He said that there were people from Saudi Arabia working in the oil industry in Houston, and that they had learned how to not waste their resource.

On April 13, 2008, Reuters reported that King Abdullah said, “When there were some new finds, I told them, ‘No, leave it in the ground, with grace from God, our children need it.’”

That was not reported in the mainstream media, but because I went to the ASPO conference, I read about it. I heard the King very clearly.

There are also others who, through regular means like Google Earth, make reasonable assumptions.

Take a look at this animation and narrative about Saudi oil fields. It seems reasonable to assume that the Saudis cannot keep on pumping endlessly.

Any “rubbah slippah” person can understand that this shows more and more oil being sucked out of the ground, and it will begin to decline. It’s all about supply and demand, and because oil is a finite resource, we should expect rising oil prices.

At the 2009 conference in Denver, someone showed a graph that pointed out the direct relationship between oil price, GDP and the last several recessions. The data showed that when oil prices exceeded $85 dollars or so, we could expect a recession.

The worrisome part is that hardly anyone makes the oil cost/recession connection. If they did, they would realize that unless we in Hawai‘i find a way to avoid the rising cost of fuel and electricity, we are at best looking at a future of very little economic growth. Because we are more reliant on oil than most, our future could be very bleak.

That is why we, in Hawai‘i, must force the change and go to low and stable cost geothermal faster, rather than slower. This will allow us to dodge the oil bullet, and will give us the opportunity to unleash the abundance of renewable energy alternatives available to us.

I really returned from a study trip to Iceland and learned that by using cheap geothermal and hydroelectric, that country is now food and fuel secure.

I am noticing more and more homeless people here. Many of them are working homeless. As we bring on more low-cost, stable geothermal, our standard of living and economic activity will rise. More and more of the working homeless will be able to get their families off the street. We can do this without having to tax the people.

We must force the change, but we will need everyone’s help. We are all in this together.

Dr. Charles Schlumberger, who is in charge of the airline section of the World Bank, spoke at the last ASPO conference. Watch video of his talk The Future of Air Transportation.

Jeff Rubin, former Chief Economist for the Canadian bank CIBC, spoke too, explaining how the world economy will shrink as oil prices rise. Here is his Oil and the End of Globalization speech.

This has very strong implications for Hawai‘i. We all know that we must get off oil. But the problem is the cost and practicality of the solution. Solutions need to be cost-effective and proven technology, as well as environmentally friendly.

Geothermal fits this requirement. But we need to move much faster than we have been.

When I return from this year’s conference, I will post this year’s speeches.

Government, Peak Oil

New York Times Op-Ed Piece on ‘The Power of Foreign Oil’

Former National Security Adviser Robert McFarlane and James Woolsey, former CIA Director and board member of Ku‘oko‘a, wrote this op-ed piece that appeared in the New York Times on Tuesday:

How to Weaken the Power of Foreign Oil

By ROBERT C. McFARLANE and R. JAMES WOOLSEY

Published: September 20, 2011

OUR country has just gone through a sober national retrospective on the 9/11 attacks. Apart from the heartfelt honoring of those lost — on that day and since — what seemed most striking is our seeming passivity and indifference toward the well from which our enemies draw their political strength and financial power: the strategic importance of oil, which provides the wherewithal for a generational war against us, as we mutter diplomatic niceties.

Oil’s strategic importance stems from its virtual monopoly as a transportation fuel. Today, 97 percent of all air, sea and land transportation systems in the United States have only one option: petroleum-based products. For more than 35 years we have engaged in self-delusion, saying either that we have reserves here at home large enough to meet our needs, or that the OPEC cartel will keep prices affordable out of self-interest. Neither assumption has proved valid. While the Western Hemisphere’s reserves are substantial and growing, they pale in the face of OPEC’s, which are substantial enough to effectively determine global supply and thus the global price…. Read the rest

At the same time, the bipartisan United States Energy Security Council was being introduced to the public in Washington. In addition to McFarlane and Woolsey, it includes Former Secretary of State George P. Shultz and two former Secretaries of Defense, William J. Perry and Harold Brown, as well as two other former National Security advisers, two former Senators, a Nobel Laureate, a former Federal Reserve Chairman, and several Fortune-50 Chief Executives (including John D. Hofmeister, former president of Shell Oil in North America).

Read its take on the issue here, and the group’s mission statement.

The U.S. mainland has a transportation problem because it depends on fossil fuel for 90 percent of its transportation needs. But Hawai‘i is especially vulnerable. We depend on fossil oil for transportation – but, unlike most places in the world, we also rely on oil to generate our electricity.

We must pay attention and force the change necessary to protect ourselves and future generations. It is no longer enough, or safe, to rely on others. We must take our future into our own hands.

Geothermal, History, Lowering Electric Rates

Kuokoa Board Member James Woolsey

James Woolsey, former director of the Central Intelligence Agency and a board member of Ku‘oko‘a, was in Hawai‘i recently to deliver the keynote address at the Asia Pacific Clean Energy Expo and Summit in Honolulu.

His keynote speech is here; forward ahead to 37:00 to hear it.

A recent Civil Beat article starts:

Hawaii needs to take decisive action in moving away from its dependence on foreign oil and capturing local renewable energy sources to power its energy needs, according to James Woolsey, former CIA director under President Bill Clinton and board member of Kuokoa, the local start-up company that wants to take over Hawaiian Electric Co.

“This will not work, this moving Hawaii into a position of leadership and saving Hawaii from its terrible energy dependence — it will not work without decisive action,” said Woolsey. “One can’t halfway do it.” Read the rest

Though he delivers a very sobering message, Jim also has a great sense of humor. While here he also spoke in Kona, and during that Q&A session, he turned his back, unbuttoned his long-sleeve dress shirt, and untucked it. Then he turned back around to face the audience to reveal his t-shirt.

Tshirt

His t-shirt shows a cartoon figure with a gas nozzle in one ear, which is blowing his brains out the other ear. The audience screamed laughing.

Also while he was here, we took the opportunity to make sure he became culturally familiar with who the Hawaiian people are, and how much importance we at Ku‘oko‘a place on all our people having a good cultural grounding in how the people think.

Greg Chun, president of Kamehameha Investment Group and an expert on the Keauhou/Kona area, met us at Keauhou to give us an orientation.

Cropped group on roof with heiau

Left to right: Ku‘oko‘a Board Member Noe Kalipi; daughter-in-law of Jacqui Hoover; Board Member Jim Woolsey; Jacqui Hoover, President of the Hawai‘i Island Economic Development Board; Kamehameha Schools’ Greg Chun, and Ku‘oko‘a President Ted Peck.

We went up on roof of the Keauhou Outrigger, because from there Jim could see a paranomic view of Keauhou – from the bay to the heiaus and to the hillsides, large expanses that were formerly terraced and planted and which supported many people in pre-contact Hawai‘i.

Heiau

We have had a lot of conversations with Jim about these things we are so grounded in, but to actually see it all and walk it is different than just talking about it. We walked to the heiaus, and out to the ocean.

Heiau - view from roof

Before Jim was a lawyer and high up in government, he studied history. So he knows a lot about civilizations and this was not foreign to him; he understood it immediately. He gets it.

Noe Kalipi, Ted Peck, June and I had a very fun dinner with him the night before his speech. He is a really good guy!

He sees that Hawai‘i is a place where you can scale technology to demonstrate that these things can be done. His whole idea is that we can do this here in Hawai‘i.

He’s like us: We are all committed to making this happen. It’s not an “if.” We must do this.