Hu Honua Bioenergy announced today it has reached a settlement with Hawaii Electric Light Company (HELCO) that will help put Hawaii Island closer to energy self-sufficiency.
The agreement puts its lawsuit on hold as it works with the utility to secure approval of an amended power purchase agreement (PPA) from the state Public Utilities Commission (PUC), Hu Honua announced in a press release.
HELCO and Hu Honua have also agreed to an expedited procedural schedule that would make it possible to complete the plant by the end of 2018.
“We have come to terms with Hawaii Electric Light Company and now have a clear path, pending PUC approval, to get the plant built and operational in time to meet the federal tax credit deadline of Dec. 31, 2018,” said Harold Robinson, president of Island BioEnergy, parent company of Hu Honua.
These developments come on the heels of a May 17 decision by the PUC to transfer review of the amended PPA to a new docket. The PUC cited several reasons for the docket transfer, including the request to consider a preferential rate in evaluating pricing, an element not considered in the 2012 docket.
In its amended PPA, HELCO requested approval of Hu Honua’s pricing based on HRS Section 269-27.3. The statute was enacted to increase energy self-sufficiency and enhance agricultural sustainability; it allows the PUC to approve preferential rates for renewable energy produced in conjunction with agricultural activities. In Hu Honua’s case, agricultural crops will be used to generate renewable biomass electricity.
“The Hu Honua project is the perfect candidate for utilizing the law,” Robinson said. “Through the cultivation and harvesting local eucalyptus trees, the project will bring a combination of agricultural benefits and renewable energy to Hawaii Island.”
If the amended PPA is approved, Hu Honua will have the capacity to provide up to 30-megawatts of firm renewable energy to HELCO’s power grid. The project will be a boost to the agricultural industry on Hawaii Island, triggering approximately 150 jobs in forestry, including logging and hauling eucalyptus trees, the primary feedstock for the biomass-to-energy facility. Ancillary jobs related to forestry and wood products are also anticipated, along with 200 construction jobs needed to complete work on the plant.