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Lawmakers Weighing Undersea Power Cable

March 8, 2012, 7:48 PM HST
* Updated March 8, 9:53 PM
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A bill regulating how an undersea cable could be built to transmit electricity to Oahu from renewable energy sources on the neighbor islands is making its way through the state Legislature.

Senate Bill 2785 has been moved from the Senate to the House where it passed first reading today. It was referred to four committees, three of which are chaired by Big Island lawmakers.

The bill would have the state Public Utilities Commission decide whether a cable was feasible, obtain the help of utility companies to select a company to install the cable, and establish a rate surcharge assessed to the utility’s customers to pay for the project.

North Kona Rep. Denny Coffman, chairman of the House Energy and Environmental Protection Committee, said he sees the cable as a way to make each island’s electrical grid more dependable by tying them together. Coffman said he envisions having the power going both ways so each of the island’s companies could share electricity as needed, as is done on the mainland where utility grids are interconnected.

“In the long term the option of having a grid-tie system among the islands may be necessary,” he said.

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Both Coffman and Rep. Bob Herkes, chair of the Consumer Protection and Commerce Committee, both believe the cable will benefit ratepayers in another way.

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“The sooner we can connect all the utility companies the sooner we’ll have better rates,” Herkes said.

Herkes and Coffman said the key to that is developing more renewable energy sources such as geothermal which are not tied to “avoided cost.” That is the basis, under federal law, under which independent power producers are paid for their electricity according to what it would have cost to produce it with fossil fuels.

But with the blessing of the federal government, the Hawaii Legislature instituted a change to allow new contracts to be independent of oil prices.

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A contract signed last year between Puna Geothermal Venture and Hawaii Electric Light Co. calls for an additional eight megawatts from PGV at a lower price than the one for the original 30 MW established in 1994.

Coffman said he’d like to see the 30-MW contract changed to remove avoided cost, but efforts to change existing avoided-cost contracts have run into roadblocks in the Legislature, partly because such efforts might run afoul of the US Constitution.

Hawaii, which produces about 90% of its power from imported oil and other fossil fuels, has historically had the highest electricity costs in the nation. The state’s utility companies said this week that customers on the Big Island currently pay 41.3 cents per kilowatt-hour, second only to Kauai’s 42.6 cents per kilowatt-hour.

The national average is 11.52 cents per kilowatt-hour.

Critics of the cable bill say it is premature, partly because sources of exportable power on the neighbor islands do not yet exist.

But Hawaiian Electric Company, the parent of Big Island utility Hawaii Electric Light Co., has been working to change that (see related article: Ormat Begins Study of a Geothermal Plant on Maui). Last year it issued a request for information from anyone interested in participating in the development of geothermal resources on the Big Island, whether in Puna where PGV is located or in Kona on the dormant volcano Hualalai. The request garnered 20 responses.

The utility is interested in developing alternative sources of energy in West Hawaii because while half of the island’s power demand is located there, the area contains only about a third of the island’s generation capacity.

However, HELCO has not always been supportive of additional geothermal power. PGV first proposed expanding its output to 38 megawatts early in the last decade but was rebuffed by HELCO which said it already had a sufficient amount of generation of its own.

Geothermal is not the only power source being eyed by the state. The proposal dubbed “Big Wind” would have established winds farms on Molokai and Lanai capable of producing 400 megawatts, but the developer of half of the project pulled out, and the state PUC instructed HECO to consider other alternative sources of renewable electricity. Several large wind farms are also under development on Oahu.

When an undersea cable bill was first introduced last year, Big Wind opponents on Molokai and Lanai mustered fierce opposition. That has yet to abate, as more than 100 residents of those islands submitted testimony in opposition to the current bill.

The concept of a cable taking geothermal power from the Big Island to Oahu dates back more than a century. In 1881, King David Kalakaua asked Thomas Edison about the feasibility of making geothermal electricity – Hawaiians were already using steam from Kilauea for cooking – and then transmitting it by undersea cable to Oahu.

The idea resurfaced in the late 1970s and early 1980s following the successful development of the experimental HGP-A well in Pohoiki.

According to the bill, an undersea power cable would help the state’s utilities achieve a goal set by state law dictating that 25% of Hawaii’s electricity come from renewable energy by 2020, and 40% by 2030.

The bill was introduced at the request of the administration of Gov. Neil Abercrombie.

 

 

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