Sunday, May 06, 2012


SB2785 will increase, not decrease, the cost of electricity on Oahu

‘Do you take this woman to be your lawful wedded wife?” “Yes, with reservations.’

If you read nothing else, don’t miss the short bonus video at the end of this article.

by Larry Geller

The Legislature’s passage of SB2785 will have a profound impact on Hawaii’s economy. And on the hope some of us had of staying on Oahu to retire in our old age.

Also, I can’t think of anything more discouraging to the prospects of small business in the state than boosting energy costs higher than we already have.

The Senate debate on May 3, 2012, took just 52 minutes and largely sidestepped the issue of the cost that will be passed to ratepayers. Lawmakers disregarded the negative effect of this provision for automatic rate increases contained in the bill that passes the cost and risk of this project on to those on Oahu who are already paying three times the national average in electricity costs:

§269-D Cable surcharge. (a) The commission shall establish a cable surcharge to allow recovery of the high‑voltage electric transmission cable system costs designated for recovery according to the ratemaking principles pursuant to section 269‑B.

. . . 

§269-E Recovery of electric utility company costs. (a) An electric utility company may recover, through an automatic rate adjustment clause, its revenue requirement resulting from the capital costs that it prudently incurs for on-island transmission infrastructure; provided that the commission has approved the utility's commitment of capital expenditure costs for the project. (b) To provide for timely recovery of the revenue requirement, the commission shall establish a separate automatic rate adjustment clause for that purpose, or modify an existing automatic rate adjustment clause. The use of the automatic rate adjustment clause to recover the revenue requirement shall be allowed to continue until the revenue requirement is incorporated in rates in an electric utility company's rate case.

Cost to already suffering ratepayers is one of the impacts of this bill, sure to be signed into law by Governor Abercrombie. I put this first because most readers live on Oahu, but we should also note and respect that residents of Lanai and Molokai have the ongoing burden of fighting the project to prevent the environmental and quality-of-life degradation that building the wind farms on their islands will bring.

After the bill is signed, most of us on Oahu will return to complacency, but not residents of Maui County, for whom the stakes are high.

For the record, below is a video of the discussion on the Senate floor, and so that Google will find it, a transcript prepared by Sally Kaye and used with her permission.  I want to thank Sally for the incredible investment of time that it took to do this, and for allowing Disappeared News to post it.

As to heroes on the Senate side, there are only three:  Senators Chun Oakland, Hee and Slom were the only ones to vote against this bill.When the rate increase hits the fan, all but these threee will be responsible for the damage.

Neighbor Island senators voted for the bill, which I’m sure will lead to some discussion back in their home districts.

Click on the thingy in the lower right for full screen.

Download 20120503 SB2785 Senate Comments from Disappeared News

Special bonus video

While waiting for the Senate session video to be processed by YouTube, this short but powerful statement was posted on line by Since they permit embedding, I’ve included it here.

Aloha – with reservations?

“Do you take this woman to be your lawful wedded wife?” “Yes, with reservations.”

I think this video expresses the way many advocates may have felt at the conclusion of this legislative session after the passage of this and other damaging bills. It also expresses a commitment not to forget.


Since when did Maui become the bumper crop producer of energy in Hawaii. Excess power way. Just because a few people are on the ball and have taken advantage of big wind...natural resource kind and business working with government kind we have windmills up and more coming. And MECO and the PUC were NOT exactly useful here either. both wind projects were cut back. Senator Roz is talking out both sides of mouth again ...disappointing. Lots of facts missing about this cable which really should put up a big red flag for everyone. Thanks for posting video....but it made me steam! Our representatives in action...shameful.

Larry, hate to break this to you but "decrease cost" is *not* an objective of the Hawaii Clean Energy Initiative or SB2785. It is really a tax credit scam for mainland tax equity & local project equity investors to make eye-popping returns -- that is now morphing into a geothermal royalties scam for Hawaii County & Native Hawaiians to get a piece of the ratepayer action.

Even sadder is that despite Henry Curtis’ incontrovertible Civil Beat commentary “Uncovering the Truth About the Undersea Cable” in which an undersea cable is not economically feasible because of reliability issues, DBEDT is going to spend millions on a EIS. What a total waste of taxpayer money: “To date, proponents have only argued for the unreliable single cable, and to expend ratepayer money studying the issue. … But what is also does, is to give state blessing to more ratepayer studies focusing on the unreliable single transmission cable concept. Surely lawmakers can think of better ways of helping some of us to recover from the recession.”

And another thing this bill does is redefine 'used and useful' one of the criteria that the PUC uses to allow cost recovery by the utility. Used and useful means that after the project is built, it must been deemed needed in order to be 'used and useful'. This awful bill changes that definition to mean that as soon as it is built, whether it is 'used and useful' or not, the ratepayers will start paying...and paying...and nauseum.

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