“The reality is that yesterday’s good enough has become today’s unacceptable.”
That sentence is in the opinion accompanying the Hawaii Supreme Court’s 5-0 decision Monday to reject Honua Ola’s Bioenergy’s appeal of the Public Utilities Commission’s denial of the company’s power purchase agreement with Hawaiian Electric Co.
The justices unanimously refuted the position taken by Honua Ola — formerly known as Hu Honua — that the PUC “impermissibly broadened the scope of issues to consider” after the high court unanimously remanded the issue of a power purchase agreement back to the PUC in May 2021.
“(Honua Ola) appeals the denial, arguing that the Public Utilities Commission misunderstood its mandate and held (Honua Ola) to an unfair standard. We disagree,” Associate Justice Todd Eddins wrote in the 20-page opinion.
The opinion noted that the PUC, in its May 23, 2022, order declining to approve the amended power contract between Honua Ola and HECO, found that the wood-burning powerplant “would produce massive (greenhouse gas) emissions, and that (Honua Ola’s) promise of carbon neutrality rested on speculative, uncertain assumptions.”
Monday’s decision follows oral arguments regarding the already completed 30-megawatt power plant in Pepeekeo.
Honua Ola and environmental group Life of the Land have been embroiled for years in a legal battle over the fate of the facility. Life of the Land argued that greenhouse gas emissions from the plant would infringe upon its members “right to a clean and healthful environment.”
“Life of the Land is very pleased that this 15-year fiasco is finally pau. Burning trees that raise (greenhouse gas) emissions, raise electric rates, and displaces cleaner wind and solar is pure lunacy,” said Henry Curtis, the environmental group’s executive director and vice president.
Honua Ola estimated that over the 30-year term of an energy contract with HECO, its electricity would be supplied at an average of 22 cents per kilowatt hour. That’s well below estimates of recently approved solar contracts, which provided estimates of 8 to 9 cents per kilowatt hour.
When the PUC in 2020 nullified a 2017 power purchase agreement between Honua Ola and HECO — saying it was cost prohibitive and not in the public interest — Honua Ola appealed to the Supreme Court. The high court in May 2021 remanded the case back to the PUC, ordering the panel to consider greenhouse gas emissions in its decision.
The PUC then declined by a 2-1 vote to approve an amended agreement, citing concerns again about cost, doubts about Honua Ola’s claims of carbon-neutral operations, and the possibility Honua Ola would displace other, more environmental friendly alternatives in the Big Island’s power grid.
Eddins wrote that the PUC “faithfully followed our remand instructions to consider the reasonableness of the proposed project’s costs in light of its greenhouse gas emissions and the project’s impact on … Life of the Land’s members’ right to a clean and healthful environment. … And it acted properly when it evaluated (Honua Ola) by its own statements and promises and, ultimately, found them unconvincing.”
In his opinion, Eddins’ said the PUC “was under no obligation to evaluate an energy project conceived in 2012 the same way in 2022.”
“Indeed, doing so would have betrayed its constitutional duty,” the justice wrote.
Marco Mangelsdorf, former owner of ProVision Solar in Hilo and longtime solar energy advocate, hailed the high court’s decision as “an unmistakable slapdown of (Honua Ola’s) position.”
“It is a tremendous victory for the state doing the right thing when it comes to pursuing cost-effective, truly clean renewable energy,” Mangelsdorf said.
Monday’s high court decision doesn’t come with instructions to send the matter back to the PUC, and in a statement, Honua Ola President Warren Lee said the company is “currently evaluating its options going forward.”
“We believe this decision sets back Hawaii’s renewable energy transition and results in Big Island residents having to continue to pay high energy rates mostly based on expensive fossil fuel oil, while also increasing the likelihood of grid instability and more blackouts,” Lee said. “The decision also compromises the many highly trained employees who have dedicated themselves to serving the community’s renewable energy future.”
In its appeal, Honua Ola accused the PUC of violating its rights to equal protection and due process under the law.
“Over the past three years, the PUC has demonstrated little regard — if any — for the significance of (Honua Ola’s) half-billion dollar investment or (its) attendant statutory and constitutional rights,” the filing stated.
The power plant was financed by a group of wealthy mainland investors led by Jennifer Johnson, president and CEO of Franklin Resources, parent company of Franklin Templeton Investments, an American multinational holding company with a reported $1.53 trillion in assets.
Email John Burnett at jburnett@hawaiitribune-herald.com.