Wednesday, November 13, 2024
Hawai'i Free Press

Current Articles | Archives

Thursday, July 2, 2015
Hawaii 100% Renewable Energy Mandate a Blank Check for Rate Hikes
By Selected News Articles @ 3:57 PM :: 8995 Views :: Hawaii County , Energy, Cost of Living

COUNTY OF HAWAII' S COMMENTS ON HECO AND CA GUIDELINES AND STANDARDS FOR RECOVERY OF CAPITAL COSTS OUTSIDE THE RAM CAP AND/OR THROUGH THE REIP

Filed by County of Hawaii with PUC, July 1, 2015 (excerpts)

...Hawaii County is concerned that the submitted proposals, especially the joint REIP (Renewable Energy Infrastructure Program), provide significant "end-runs" around the policies to review and control HECO's capital costs that the PUC has worked diligently to implement. The RAM (Revenue Adjustment Mechanism) Cap and REIP mechanisms provide additional means for HECO Companies to evade the PUC's intent, which is to carefully monitor and control additions to the HECO rate base....

County reiterates its support for the PUC's concerns and efforts as expressed in Order No. 32052 (April 28, 2014) ... :

...the nature of the electric utility business is evolving rapidly in light of technical, market and public policy changes that have and will continue to occur in Hawaii. The Commission observed that:

".. .the HECO Companies appear to lack movement to a sustainable business model to address technological advancements and increasing customer expectations. The commission observes that some mainland electric utilities have begun to define, articulate and implement the vision for the 'electric utility of the future.' Without such a long term, customer focused business strategy, it is difficult to ascertain whether HECO Companies' increasing capital investments are strategic investments or simply a series of unrelated capital projects to expand utility rate base and increase profits appearing to provide little or limited long term customer value."

The IRP Action Plan appeared to be, in part, a series of unrelated capital projects without strategic focus on the clear issues facing the utility, mid did not indicate further progress towards a sustainable business model. More recently, the HECO Companies' proposed 2014 capital expenditure program also appeared to be comprised of unrelated capital projects without strategic focus mid of questionable long-term customer value."

The REIP is particularly problematic. With passage of House Bill 623 and its signature by the Governor, Hawai'i State policy is now committed to 100% renewable energy by 2045. If not implemented with the highest level of concern for customer welfare and costs, the REIP and Bill 623 together deliver a "blank check" argument for HECO to justify practically any capital investment project on the grounds of meeting (or contributing to) Hawai'i's energy objectives, leaving the PUC as (potentially) the sole party to ask hard questions whether a proposed project is the most cost effective engineering solution available, and whether it fits into a comprehensive energy system design that is best for Hawai'i's people.

Without a thorough analysis of system design configurations and their associated costs to consumers performed by an objective, third party, the PUC will be essentially limited to options presented by the Utilities—with substantial pressure to approve whatever is proposed simply to meet the 100% renewables objectives.

This will place the PUC in an increasingly challenging role, given the political pressure that already exists and is expected to increase to approve renewable projects— often with little or no consideration by project proponents of cost implications for Hawai'i's hard-pressed citizens and ratepayers.

This is not an idle concern, as there is precedent for deeply flawed projects to be advanced in the name of meeting Hawai'i's renewable energy objectives.

For example, the Aina Koa Pono project was brought not just once, but twice, to the PUC for approval—with primary justification to meet the State's renewable energy objectives (in this case the project was a fuel purchase agreement from a third party for renewables-based biodiesel). This project was fatally flawed in every aspect, including: land, land use, feedstock, agronomic yield predictions, premature processes (not demonstrated at scale or length of operations), transportation impact on local roads, energy/mass balance, need for hydrogen to upgrade fuel energy content, irrelevant Life Cycle Analysis estimating carbon reductions, waste streams and environmental impact, oil price forecasts, and needlessly increased electricity prices imposed on Hawaii's longsuffering consumers. Inexplicably, the HECO companies promoted this fatally troubled project—twice—and were joined with support from the Consumer Advocate and (tangentially) DBEDT.

Fortunately for the citizens of Hawai'i, the PUC justifiably, wisely, and courageously resisted the pressure to move this project forward, and rejected it...twice. Were it not for the PUC, Hawai'i's citizens would now be facing higher costs from a project that should never have advanced beyond wishful thinking.

One can only imagine the pressure that will be placed on the PUC to approve a project, any project no matter how many inherent flaws, if it is claimed to move towards the State's goal of 100% renewable energy use.

There are numerous indications in the HECO/CA proposal that the REIP could be used to approve any project that can be shoe-homed into a definition of "renewable."

Page 4 (of the PDF) of HECO's June 15, 2015 independent proposal opens the door for REIP recovery for pretty much any project that uses or contributes to using renewably-based generation, with prejudice towards grid-connected projects:

"In the Joint Proposed Modified Renewable Energy Infrastructure Program Framework, the Consumer Advocate and the Companies have agreed that the scope of the REIP should be expanded to include projects that support incorporation of additional renewable energy on the grids or other undertakings of strategic importance to industry transformation."

Read ... Full Text

Background:

Links

TEXT "follow HawaiiFreePress" to 40404

Register to Vote

2aHawaii

Aloha Pregnancy Care Center

AntiPlanner

Antonio Gramsci Reading List

A Place for Women in Waipio

Ballotpedia Hawaii

Broken Trust

Build More Hawaiian Homes Working Group

Christian Homeschoolers of Hawaii

Cliff Slater's Second Opinion

DVids Hawaii

FIRE

Fix Oahu!

Frontline: The Fixers

Genetic Literacy Project

Grassroot Institute

Habele.org

Hawaii Aquarium Fish Report

Hawaii Aviation Preservation Society

Hawaii Catholic TV

Hawaii Christian Coalition

Hawaii Cigar Association

Hawaii ConCon Info

Hawaii Debt Clock

Hawaii Defense Foundation

Hawaii Family Forum

Hawaii Farmers and Ranchers United

Hawaii Farmer's Daughter

Hawaii Federation of Republican Women

Hawaii History Blog

Hawaii Jihadi Trial

Hawaii Legal News

Hawaii Legal Short-Term Rental Alliance

Hawaii Matters

Hawaii Military History

Hawaii's Partnership for Appropriate & Compassionate Care

Hawaii Public Charter School Network

Hawaii Rifle Association

Hawaii Shippers Council

Hawaii Together

HiFiCo

Hiram Fong Papers

Homeschool Legal Defense Hawaii

Honolulu Navy League

Honolulu Traffic

House Minority Blog

Imua TMT

Inouye-Kwock, NYT 1992

Inside the Nature Conservancy

Inverse Condemnation

July 4 in Hawaii

Land and Power in Hawaii

Lessons in Firearm Education

Lingle Years

Managed Care Matters -- Hawaii

MentalIllnessPolicy.org

Missile Defense Advocacy

MIS Veterans Hawaii

NAMI Hawaii

Natatorium.org

National Parents Org Hawaii

NFIB Hawaii News

NRA-ILA Hawaii

Obookiah

OHA Lies

Opt Out Today

Patients Rights Council Hawaii

Practical Policy Institute of Hawaii

Pritchett Cartoons

Pro-GMO Hawaii

RailRipoff.com

Rental by Owner Awareness Assn

Research Institute for Hawaii USA

Rick Hamada Show

RJ Rummel

School Choice in Hawaii

SenatorFong.com

Talking Tax

Tax Foundation of Hawaii

The Real Hanabusa

Time Out Honolulu

Trustee Akina KWO Columns

Waagey.org

West Maui Taxpayers Association

What Natalie Thinks

Whole Life Hawaii