Pacific Business News: PUC Ruling Ushers Uncertain Future for Hu Honua Biomass Facility
Jul 10, 2020
By Megan Fernandes
The state Public Utilities Commission denied a request from Hawaii Electric to waive competitive bidding on the long embattled — and nearly completed —21.5- megawatt, $350 million Hu Honua Biomass facility on Hawaii Island.
In a letter to the PUC dated June 10, the power plant’s representative, the Yamamoto Caliboso law firm, shared the
company’s concern regarding the delay and urged the PUC to hold a scheduling conference on this docket.
The most recent in a series of blows to the project, Thursday’s ruling added to the mounting challenges the project has faced since it was first introduced in 2008.
The PUC states in the docket that while the Hu Honua project may result in community benefits such as economic stimulation and employment creation, these arguments are not unique to the Hu Honua Project. The PUC argued that any approved project developer would be required to build, maintain, and operate renewable facility — and in effect, share the same economic benefits to the community.
The docket sites other concerns, such as Hawaiian Electric’s updated resource plans — where the addition of the Hu Honua Project coming online in 2020 does not directly accelerate the retirement or conversion of any of the utility’s existing fossil fuel plants on the island — and lingering issues regarding the impact of the Project’s GHG emissions amid Hawaiian Electric’s rapidly growing portfolio of solar-plus-storage projects.
“To be clear, this is not to say that the Hu Honua Project is irrelevant or that biomass resources do not have place in Hawaii’s renewable energy portfolio,” The PUC stated in the docket. “The pertinent issue here is whether this particular project should be exempted from competitive bidding against other renewable projects to determine the best value for [Hawaiian Electric] and its customers … in light of the commission’s rulings above, the commission finds that the other issues in this proceeding, including the pending motions filed by Life of the Land, are
moot.”
Honua Ola Bioenergy stated that the decision results in “imminent layoffs” of 64 current Hu Honua employees and contractors and the loss of an additional 145 positions to be filled, consisting of ancillary jobs in trucking, forestry and support services on Hawaii Island.
“The PUC’s action not only forecloses the opportunity for Hu Honua to have its GHG reduction considered at an evidentiary hearing, as contemplated by the Supreme Court, but also precludes all the benefits of Hu Honua’s locally produced renewable energy, resulting in the prolonged use of imported fossil fuel on Hawaii Island that Hu Honua’s
firm renewable energy was designed to replace,” the company stated.
Honua Ola Bioenergy said that the company is studying the decision to determine how to proceed. The PUC’s action essentially reverses its two prior approvals of the PPA and waivers that allowed the project to
originally proceed.
“Understandably, we are disappointed by the PUC’s decision,” Honua Ola Bioenergy said. “Especially considering that more than $350 million has been spent on a state-of-the-art renewable energy facility that was anticipated to be completed and ready to commence operations in 2020, and the more than 200 well-paying jobs that would have existed for the next 30 years.”
Opposers of the project saw the ruling as a victory and end to the project’s prospects. “As we accelerate the transition to clean green energies, we can and must do better than bringing on new combustion power generation, regardless
of the fuel source,” Marco Mangelsdorf, president of ProVision Solar in Hilo said in a statement.
The ruling also comes amid other uncertainty with other projects, such as the 38-MW Puna Geothermal Venture plant on Hawaii Island which has been pushed back from reopening in late 2019 to sometime this year.
Pacific Business News, Jul 10, 2020:
https://www.bizjournals.com/pacific/news/2020/07/10/puc-rulingushers-uncertain-future-for-hu-honua.html