Friday, July 15, 2011

 

Blowing in the Wind


By Henry Curtis

A few years ago the Public Utilities Commission approved a new Competitive Bidding process for new electrical generation.

Just beating the requirement for competitive bidding, HECO filed a Request For Proposal [RFP] in 2008 seeking renewable energy projects on O`ahu ranging from 5-100 MW each.

Castle & Cooke and First Wind Hawaii each submitted proposals for large wind farms (350-400 MW) on Lana`i and Moloka`i and connecting the wind farms to O`ahu via an undersea high voltage transmission line. On December 31, 2008, HECO reached an agreement with Castle & Cooke and First Wind to bifurcate or split their proposals, accepting 200 MW from each of them.

The Public Utilities Commission ruled that this whole process was highly irregular, but agreed to it in the interest of meeting State renewable energy goals. The Commission gave a deadline of March 2011 to completing the rough financial terms of the agreements.

Castle & Cooke met the deadline, First Wind failed to do so.

Thereupon, HECO told the PUC there was a secret part of the HECO- Castle & Cooke and First Wind agreement that allowed HECO to re-assign First Wind’s proposal to Castle & Cooke, who in tern, could give it to Pattern Energy, who in tern would be financially assisted by Biological Capital. First Wind challenged this interpretation.

On July 14, 2011 the PUC rejected this convoluted process. Instead the Commission proposed that competitive bidding be used to secure First Wind’s 200 MW of Moloka`i wind energy.  

“It should be noted that by requiring a new RFP [Request For Proposal] , the commission does not intend to favor particular energy resources or geographical locations over another. Instead, the commission seeks to encourage a greater number of renewable developers to enter into the process. Based on the foregoing, the commission hereby directs HECO to submit to the commission a new RFP according to the Framework for Competitive Bidding. The new RFP shall be for a minimum of 200 MW of renewable energy.”

The Commission’s ruling added:”the commission wishes to stress that such findings are not meant to illustrate an endorsement of the inter-island renewable energy project, nor has it made a substantive determination of the project's viability. The commission reserves the right to revisit any and all aspects of a project's viability when HECO makes its formal Application for approval of any power purchase agreement.”

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Henry Curtis
ililani.media@gmail.com

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