Save Pohoiki - Keep Puna Clean and Green
February 24 2015 HELCO selects Ormat to provide 25 MW of additional geothermal energy
February 11, 2016 Ormat withdraws from contract negotiations -- see HELCO report to PUC
In June of 2011, when Hawaii Electric Light Company (HELCO) began the process that led to issuing a request for proposals (RFP) for a new 50 megawatt geothermal facility, the political climate supported a bidder being selected. In a March 16, 2012, letter, HELCO asked the the Public Utilities Commission (PUC) to allow the formal RFP procedure to begin. The letter said, in part:
"HELCO believes that there is clear directive ... evidenced by strong government support for geothermal development ... recent interest by geothermal developers and advocacy groups, and a positive trend in public support for renewable energy.... on June 22, 2011, HELCO issued a Geothermal Request for Information.... One of the key outcomes of the RFI was that geothermal developers advocated pursuing an expedited competitive bidding docket schedule ...."
HELCO's letter suggests that it was going forward with the new geothermal RFP due to political pressure. On February 28, 2013, HELCO issued the RFP. One of the points made by a July 13, 2013, letter from Puna Pono Alliance (PPA) to HELCO, objecting to the RFP, was that HELCO was 'putting the cart before the horse' by yielding to political pressure without first completing adequate planning.
Things began to change as the RFP process went forward. Strong public opposition to building a new geothermal facility emerged and led to a demonstration at HELCO in August of 2013. On September 9, 2013, the final report of a study of geothermal health and safety issues was delivered to the Mayor and published. The study report, funded by the County of Hawai`i, said “events during the HGP-A era and during the 1991 blowout provided exposures associated with adverse health effects.... Risks from geothermal energy production in Lower Puna exist.” Those and additional factors (such as rapidly decreasing solar energy costs) affected the political climate.
On December 20, 2013, HELCO rejected all of the submitted bids, “... none of the submitted bids sufficiently met both the low-cost and technical requirements of the Geothermal RFP. We are currently working with the Independent Observer to develop a request that will be sent to the bidders. The request will give the bidders the opportunity to provide additional information so that we can make an informed decision that is in the best interests of our customers and residents and that meets the goals of the Geothermal RFP. These goals include lowering customer bills, reducing our dependence on fossil fuels, allowing for continued integration and management of intermittent renewable resources, maintaining reliability of service, and protecting the health and safety of the public and environment.”
On February 21, 2014, the RFP Independent Observer told the PUC “it is apparent to us that the continued delays in the RFP are due to HELCO ‘putting the cart before the horse’ by not having performed sufficient planning before the issuance of the RFP.” A long term integrated resource plan (IRP) prepared by HELCO's parent company was rejected by the PUC on April 28, 2014. On June 4, 2014 (according to a post on HELCO's geothermal website) HELCO (responding to a Public Utilities Commission Order) provided an action plan that includes a proposed schedule for Best and Final Offers from geothermal bidders.
HELCO’s June 4th response to the PUC looks more realistically at what is needed, such as by asking is a “commitment to allocate limited system capacity to a geothermal Project in the long-term best interest” of ratepayers; will it result in “lowering customer bills, reducing Hawai`i’s dependence on fossil fuels, allowing for continued integration and management of intermittent renewable resources within the system, maintaining reliability of service, and protecting the health and safety of the public and environment.”
HELCO says “the purpose of the Geothermal RFP is to obtain cost-effective (meaning at a substantially lower system-wide cost to the customer) geothermal Dispatchable energy” – that is, HELCO will take only as much electricity from a new geothermal plant at any given time as is required by fluctuating customer demand. Further, “a new geothermal facility will be required to ... enable the continued integration and management of intermittent renewable resources, such as wind and solar power” – meaning as more solar electricity becomes available from rooftop photovoltaic, HELCO would be taking less electricity from a new geothermal facility.
Bidders were told if you can meet those requirements, then go ahead and submit your best offer (anticipated to be by January 15, 2015) and then HELCO will make a final decision. However, the bids must "take into consideration the impacts of Hawai 'i County Code Article 19 relating to [the ban of nighttime] geothermal drilling ... and the potential impacts of recently enacted Hawai'i County Code Article 21 relating to hydraulic fracturing ...." Also, a "levelized threshold price will be determined based on research of geothermal industry pricing ... [that] will be the maximum Combined Bid Price that Hawai'i Electric Light is willing to consider in this Geothermal RFP. Best and Final Offers with pricing above the Threshold Price shall be deemed nonresponsive and shall not be considered for the Final Award Group.... If all Bids do not meet the Threshold Price then the Geothermal RFP process will be concluded with no Bid being selected...." (Emphasis added.)
June 18, 2014, Consumer Advocate’s comments on HELCO's response to PUC’s geothermal RFP order said:
" ... any bids that have been submitted for new geothermal generation on the Island of Hawaii should be able to demonstrate clear cost reduction benefits. Further, given the current renewable energy penetration levels, the prevailing electricity prices on the Island of Hawaii, and no urgent need for new generation, such cost reduction should not be set just below the current avoided cost; It should be significantly lower. Given the many changes In technology and In Hawaii's energy market, the RFP should be targeted to result in greater benefits to the customers.... simply targeting a price that Is just below current avoided fossil fuel costs, especially when Hawaii Electric Light Is already well ahead of the 2030 RPS goal, would be a disservice to the electricity consumers of the Island of Hawaii and would not be consistent with ensuring "a 'no regrets' economic development of renewable energy projects. Thus, any selected geothermal project should reflect "price levels below which 'no regrets' acquisition of renewable energy projects would occur from ratepayers' perspective...." (Emphasis added.)
Sincere thanks to the petition signers, letter writers, marchers and demonstration participants involved in helping HELCO understand the community's serious concerns about new geothermal development. If you would like to keep up with Hawai`i geothermal health and safety issues, please click the link below to
Join the Puna Pono Alliance email list
Prior geothermal activity in the Pohoiki area of the Island of Hawai`i has caused serious community harm, resulting in successful lawsuits by more than 100 residents.
Hawaii Electric Light Company's effort to contract for new geothermal development without considering the community's concerns led us to create a petition to Jay Ignacio, President of HELCO, saying:
"We want Hawaii Electric Light Company (HELCO) to stop its contract for new geothermal development on the Island of Hawai`i because (1) the contract was excluded from the utility's recent public planning effort and (2) previous geothermal sites on this Island have been notoriously unsafe, unclean and poorly regulated."
A March on HELCO on August 17, 18 & 19 successfully demonstrated community opposition to geothermal development in the present situation (including continual PGV upset events, lax regulation and poor planning.) Hundreds of people participated both by marching for three days from Pahoa to HELCO's Hilo headquarters and by joining the demonstration at HELCO on the final day, Monday, August 19th.
Links:
Letter (from Bob Petricci to Jay Ignacio)
Video (about Pohoiki and geothermal)
