The state Public Utilities Commission on Friday denied motions by Honua Ola Bioenergy and Hawaiian Electric to reconsider its decision last month to reject an amended power purchase agreement between the utility and the nearly completed power plant in Pepeekeo.
In addition, the PUC rejected Honua Ola’s request for a hearing on its motion for reconsideration.
As in the original May 23 decision to reject the contract, the vote was a majority decision, with PUC Chairman James Griffin and Commissioner Jennifer Potter signing the 44-page order. Commissioner Leodoloff Asuncion, who voted in favor of the amended power purchase agreement, abstained from signing the order.
Friday’s decision, for now, keeps the $520 million project from going online and producing electricity.
Honua Ola, formerly known as Hu Honua Bioenergy, has 30 days to appeal the PUC’s order to the state Supreme Court.
In a statement, Honua Ola said it will weigh its legal options, including appealing to the state’s high court.
“We are disappointed in the PUC’s decision, but we are not giving up because Honua Ola is in the right on this issue, and we owe it to our employees who have stuck with us, and to the Big Island residents who support Honua Ola’s commitment to provide clean, renewable energy,” Honua Ola President Warren Lee said in the statement. “We look forward to continuing to show that Honua Ola has done everything asked of us to reduce greenhouse gas emissions and become Hawaii’s first carbon-negative power plant.
“This isn’t just a setback for our company, but for all Hawaii Island families and businesses who are currently paying nearly twice the rate Honua Ola would offer.”
Honua Ola’s statement said the power plant is now 99% constructed and currently has a staff of 30 full-time employees, and added the continued construction of the facility at the former Hilo Coast Processing Co. site was “spurred forward by two prior approvals by the PUC of Honua Ola’s power purchase agreement with Hawaiian Electric in 2013 and 2017.”
“We expect that an appeal will occur, and we expect that the Supreme Court will end this fiasco,” said Henry Curtis, executive director of the environmental group Life of the Land, which has been embroiled for years in a legal battle with Honua Ola in an attempt to stop the eucalyptus-wood burning plant from producing electricity.
The May 23 PUC decision said Honua Ola shouldn’t be granted an amended power purchase agreement with Hawaiian Electric because the power plant will produce “significant” greenhouse gas emissions, and that approval of the contract — with an estimated average cost of 22 cents per kilowatt hour over a 30-year period — would likely result in higher costs to ratepayers and would displace more cost-effective renewable projects in the grid, such as solar.
In Friday’s ruling, the PUC found Honua Ola’s argument that it is precluded from participating in the next round of project bids based on its existing amended contract with Hawaiian Electric unconvincing because the Supreme Court vacated the 2017 agreement.
“Moreover, Hu Honua cannot rely on the commission’s prior approval of the (contract) as basis for reasonable expenditure of funds on the project,” Friday’s order stated.
Email John Burnett at jburnett@hawaiitribune-herald.com.