Tuesday, December 28, 2010


Corporate Chrismas Presents paid for by consumers

By Henry Curtis

The Public Utilities Commission (PUC) has adopted competitive bidding for large energy projects, figuring that competition would decrease ratepayer bills. Sounds good, right?

Last May Hawaiian Electric Company (HECO) presented the PUC with a simple question.

What is one large system (that would require competitive bidding) were broken done into an interlinked set of smaller systems (each of which individually wouldn't require competitive bidding). What if HECO monitored the costs to make sure that ratepayers got the best deal. Would that be okay? Could these small systems evade the rules?

With no surprise what-so-ever, the Consumer Advocate, an arm of the utility for the past 8 years, agreed with the utility that this evasion of competitive bidding was okay.

Life of the Land was the only group to offer comments, asking the PUC for consistency between this request and other utility programs.

The Commission saw through the utility ruse: "the proposed sharing of various development costs, shared interconnection facility, and contiguous development site location creates the impression that the project is indeed one single venture. Finding this project exempt also raises the specter of creating a precedent loophole by which other potential developers may also attempt to partition a given project into 5 MW pieces in order to avoid compliance with the competitive bidding requirements."

The PUC should have ended its comments there, but they then approved the project, concluding:

"Granting a waiver allows the commission to monitor the project's effectiveness and evaluate whether the project's proposed new paradigm is one worthy of future replication without opening the door for applications based on a perceived loophole in the Framework's requirements." Huh??!

In his dissent, Commissioner Kondo noted: "HECO does not request a waiver of the competitive bidding requirements and, in fact, expressly states that 'Hawaiian Electric does not by this Petition seek, nor does Hawaiian Electric in the future intend to seek, a waiver from competitive bidding requirements' ...The majority, however, decides, sua sponte, that "it [is] in the public's interest to grant a waiver to the project."' That conclusion is simply arbitrary and reflects the majority's myopic regulatory vision."

The missing part of the equation is who this is for: Castle & Cooke.

Castle & Cooke is the entity that convinced the State House but not the State Senate in 2008 to pass HB 2863, which would have allowed their proposed Lana`i 200MW Windfarm to get fast track permitting and automatic approval. Then they convinced the PUC that their Big Wind proposal should be exempt from competitive bidding.

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Itʻs long overdue that the PUC itself should be called into question and a (I know, funds to do this from where?) thorough audit of commissioners for the likeliness of being on the take, be done.
Or simply the PUC should be disbanded and replaced by legislative oversight for matters such as this if at all possible.
It looks like Castle & Cook was doing an under the table move; am I reading that right?
We donʻt need a rubber stamp PUC anymore, nor have we ever needed it.
Seems like all their decisions have been regrettable ones. Look at Verizon. I attended that and the Carlyle Group with rep. Kennard had them ʻin the bag and by the ballsʻ, no questions asked.
PUC is defective and destructive and counter productive for its intended purpose.

This kinda sounds like the way we regulate our off shore deep oil drilling. Put the oil companies in charge of writing the regulations, place ex-oil company lobbyist in charge of the regulatory agency. And then blame government for any and all oil disasters.

Yes. And why does it continue when the information about these cozy arrangements is out in the open, not like before the internet and safely in the shadows?

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