A Hawaiian Electric representative hopes customers’ energy bills might start to decrease by the summer, but nothing is certain.
During a Tuesday meeting of the County Council Committee on Regenerative Agriculture, Water, Energy and Environmental Management, council members heard an update from Hawaiian Electric about the rising energy costs on the island stemming from Russia’s invasion of Ukraine.
Jennifer Zelko-Schlueter, Hawaiian Electric’s director of Government and Community Relations for the Big Island, reiterated to the committee that the company predicts the average Big Island residential energy bill is expected to increase by about 20% over the next few months, which the utility previously announced earlier this month.
Council members were eager to know when Hawaiian Electric believes the spike in prices will recede, but Zelko-Schlueter could make no promises.
“Although we don’t have a crystal ball, I think the hope is by summer we would see some relief,” Zelko-Schlueter said. “In some ways, last week, there was good news: We had seen oil go up to $120 a barrel, and then it was down under $100.”
Hamakua Councilwoman Heather Kimball bluntly asked Zelko-Schlueter if she believes the rising prices constitute an energy emergency.
Last week, Mayor Mitch Roth sent a letter to Gov. David Ige urging him to declare the cost of fuel an emergency and fast-forward renewable energy projects awaiting review by the Public Utilities Commission.
After some hesitation, Zelko-Schlueter agreed and said that Hawaiian Electric will work with the PUC and the county to address the matter as best it can.
But, at the same time, she cautioned against speeding up the PUC too much.
“I think there is a purpose for the regulatory process, and part of that … is the community input piece,” Zelko-Schlueter said. “When you see some of the projects that have been sitting there (with the PUC), there has been significant community opposition. And the regulatory process allows community to come together and talk.”
Zelko-Schlueter said the spike in electric bills is because of the rising price of oil caused by sanctions levied against Russia following its attack on Ukraine. This is despite the fact that, as of December, about 60% of the energy provided by the utility on the Big Island is renewable and should be decoupled from the rising price of oil.
However, Zelko-Schlueter said, four of the renewable energy providers from which Hawaiian Electric purchases power on the island have contracts that are specifically tied to the price of oil. These “avoided energy cost contracts” increase payments to the providers if the price of oil passes above a certain threshold, which is felt among customers’ energy bills.
In the meantime, Zelko-Schlueter said Hawaiian Electric is working with its energy providers to renegotiate their contracts to prevent the cost of oil from impacting energy costs to such an extent. So far, she said, two of the four providers still using avoided energy cost contracts have agreed to drop those terms.
Puna Geothermal Venture agreed to do so early in the process of seeking a facility expansion, and Hawi Renewable Development had that language removed after the expiration of its previous contract in 2021.
Hawaiian Electric has approached the other two providers — Tawhiri Power in Naalehu and Wailuku River Hydro — with proposals to renegotiate but have not yet responded, Zelko-Schlueter said.
Email Michael Brestovansky at mbrestovansky@hawaiitribune-herald.com.