Utilities commission rejects Hu Honua’s deal to provide energy for HECO

HONOLULU, Hawaii (HawaiiNewsNow) - The state Public Utilities Commission rejected a proposal by Hu Honua Bioenergy on Thursday to provide electricity to Hawaiian Electric Co. in a move the company says will lead to the loss of more than 200 jobs.

The PUC denied the company’s request for a waiver from the competitive bidding process for renewable energy, forcing it compete with lower cost wind and solar projects.

“I don’t think the project will be back. It’s just way too costly,” said Henry Curtis, executive director of Life of the Land, a consumer group that opposed the deal. “The Hu Honua plant would have been a terrible deal for ratepayers.”

Curtis said the plant ― which burns wood chips to generate electricity ― produces power at twice the cost of solar energy.

Hu Honua will likely appeal. The company said the ruling will force it to lay off 64 staffers and contractors, and that another 145 trucking, forestry and support jobs will likely also be lost.

In a statement, the company said: “The PUC’s action essentially reverses its two prior approvals of the (power purchase agreement) and waivers that allowed the project to proceed and which Hu Honua relied on in spending hundreds of millions of dollars.”

Hu Honua, which is changing its name to Honua Ola Bioenergy, said its plant in Pepeekeo has taken a dozen years to build at a cost of about $350 million dollars.

Hawaiian Electric said Hu Honua would have provided a broader mix of renewable energy on the Big Island, but added:

“Even without Hu Honua, proposed and existing renewable energy projects ... will enable Hawaii Island to use renewable resources to generate nearly all of its electricity by the end of this decade,” the company said.

This is the second major set back for the company. Last year, the state Supreme Court voided its power purchase agreement with the utility and ordered the case back to the PUC.

The high court said the commission should have considered the amount of greenhouse gasses the plant would produce to generate electricity.

“Burning biomass produces a lot of toxic chemicals,” said Curtis. “This project would have stunk for the environment. It would have said we’re going to plant trees to fight climate change, and we’re going to chop down trees at the same time.”

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