With tourism shut down, sustainable start-ups hope to fuel a new era in Hawaii’s economy

HONOLULU, Hawaii (HawaiiNewsNow) - Tourism may be the driving force behind Hawaii’s economy, but a growing number of entrepreneurs and business agree: It doesn’t have to be the only one.

With the visitor industry still shut down amid the pandemic, new industries are showing strength and using the state’s abundant natural resources ― the sea, the rich soil, and year-round, abundant sunshine ― to fuel their businesses.

Shifted Energy is a local start-up that uses a device to turn electric water heaters into smart, energy storage devices.

“Trick the water heater into heating from like 10 a.m. to 2 p.m.” explained Forest Frizzell, CEO of Shifted Energy, which invented the technology that turns the appliance on during peak hours of sunshine.

The water stays hot until the residents need it, usually between 5 p.m. and 9 p.m. That means fewer customers drawing from the grid nightly.

“Water heaters are really efficient in the way that they work, so they only drop about a half a degree or so every hour, especially in Hawaii where we have warmer ground water,” said Frizzell.

Shifted Energy has partnered with Hawaiian Electric so there’s no charge for the installation or use of the device and customers can see a small credit on their monthly electric bill.

The technology is gaining national attention. Shifted Energy has increased it’s workforce this year and anticipates adding even more employees in the coming months.

The company is one of many getting support from Elemental Excelerator, which is based in downtown Honolulu and funds small businesses that focus on the environment and local communities.

Another start-up expanding in Hawaii is Blue Ocean Barns, which is setting up a lab in Kona that creates a limu-based ingredient for cow feed that helps the environment.

"When cows burp they emit methane and methane is a terrible greenhouse gas so if you just sprinkle a little bit of this red seaweed into the cow’s diet they reduce methane emissions,” said Danya Hakeem, director of innovation at Elemental Excelerator.

The limu is native to Hawaii and Blue Ocean Barns will harvest small amounts to grow on land.

The seaweed doubles every 19 days.

Blue Ocean Barns’ goal is to expand the lab and hire 100 people in Kona in the next two years.

The pandemic underscored the state over-reliance on tourism and spotlighted Hawaii’s dependency on imports. Some 85% of the state’s food is brought in.

While many local farmers are producing fresh products, there are challenges to ensuring the demand meets the supply.

When restaurants were forced to shutter, programs like Farm to Car, Farmlink, and the Kau Kau Box became the only way for farmers to supplement their incomes.

Eateries are slowly reopening but with limited capacity, so the demand still lags.

“What the pandemic has shown us is that it’s made us very vulnerable, very susceptible to outside forces,” said Kawika Burgess, CEO of Kalona Brand, which operates a farm on 222 acres of land in Haleiwa that’s owned by Kamehameha Schools.

Burgess is focused on products that are unique to Hawaii and not in direct competition with other states and countries.

“Crops that can be grown similarly but cheaper in other areas will be grown similarly and cheaper in other areas, and we won’t be competitive,” Burgess said.

He added that was the lesson learned after the death of pineapple and sugar cane in Hawaii.

The farm’s primary crop will be cacao, a component in chocolate.

Cacao is grown elsewhere, but Burgess said Hawaii grown plants have a flavor that has not been replicated elsewhere.

“Because of our rich, volcanic soil, our micro-nutrients, our clean air and water, the cacao here develops a unique flavor," he said.

Kalona Brand just started putting cacao plants in the ground this year and are about two to three years from harvest.

Another section of the farm is dedicated to avocados, not the Haas varieties from Mexico or California, but a variety unique to the islands.

“The market is growing by 10% a year,” said Burgess, "Supply is not keeping up. It’s growing at only about 3% so again, another great opportunity for Hawaii farmers, Hawaii growers to supplement that gap in the market.”

Kalona Brand is also working to build the supply of ulu, the islands’ native breadfruit. Ulu is considered a super fruit, a nourishing substitute for the potato.

Kamehameha Schools will serve ulu and avocados from the Kalona Brand farm when the crops are finally ready.

Economists say building relationships with local farmers and other businesses will help Hawaii build a more sustainable future.

“It’s an opportunity to chart a new course for ourselves," said Dawn Lippert, CEO of Elemental Excerlerator, "If there is a time that this can work, now is the time to really lean into what’s possible.”

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