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| The corner of Meyer Camp and Wood Valley Road, looking toward proposed site of the `Aina Koa Pono diesel refinery. Photo by Julia Neal |
Writes Ha: “HECO’s public relations people say that as a result of this new project going through, the average Hawai`i rate payer’s electricity bill would increase by only about $1 a month. But let’s look at that in a little more depth. HECO is seeking approval to pay `Aina Koa Pono $200/barrel for the biofuel it produces on the Big Island at Ka`u, and would pass on any extra cost (beyond what oil actually costs at the time) to its ratepayers, both on the Big Island and on O`ahu.
“HECO has kept that $200/barrel price secret – they are still keeping it secret – but the Big Island Community Coalition folks figured out the price, and how the ‘$1/month rate increase’ was determined. Using the Energy Information Agency’s Annual Energy Outlook, one can see that HECO is using the highest price scenario, which projects an oil price close to $180/barrel in 2015. In the AKP discussion, it was said that the price of oil would exceed the actual price projected at the end of the period. “We can see that the line hits $200/barrel in 2035. Since they assume that oil will be $180 in 2015, they can therefore say that the difference (between the actual and projected price) would be very small: Hence, an increase of only perhaps $1/month for the average ratepayer.
“However, it follows that if the actual price of oil is much lower than $180/barrel, rate payers will be paying the difference between that amount and $200. What if the actual cost of oil in 2015 is $120/barrel? That would cause rates to go up much more than $1/month – especially for high-power users.
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| `Aina Koa Pono says it will use existing pasture and unused land to grow biofuel crops. Photo from www.ainakoapono.com |
“I cannot help but think that HECO is damaging its credibility immensely by pushing this project. HECO is spending hundreds of thousands of dollars on public relations to convince us that it is trying to lower people’s rates – when, in secret, it appears to be doing exactly the opposite.
“By the way, HECO says the hundreds of thousands of dollars it spends on PR comes from its shareholders. How can ratepayers tell when HECO is speaking on behalf of its shareholders, and when it's speaking on behalf of its customers?
“This `Aina Koa Pono project needs to be rejected because it will make our electricity rates rise. Rising electricity rates act like a giant regressive tax, because as folks who are able to leave get off the grid, those who cannot afford to are left to pay for the grid.
“By the way, HECO says the hundreds of thousands of dollars it spends on PR comes from its shareholders. How can ratepayers tell when HECO is speaking on behalf of its shareholders, and when it's speaking on behalf of its customers?
“This `Aina Koa Pono project needs to be rejected because it will make our electricity rates rise. Rising electricity rates act like a giant regressive tax, because as folks who are able to leave get off the grid, those who cannot afford to are left to pay for the grid.
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| Richard Ha farms tomatoes and bananas and comments on biofuel plan for Ka`u. |
“This results in farmers and other business folks having higher operating costs. For everyone else, it takes away discretionary income. And we know that two-thirds of our economy is made up of consumer spending. “There are also problems with the project itself. Fuel has never actually been produced using the process and feedstock that `Aina Koa Pono proposes. AKP does not know what it is going to grow. So far, the feedstock it is testing experimentally is white pine. The Micro Dee technology that AKP wants to use is still experimental.
“There is also a risk that this process might use more energy than it generates. Generating electricity is generally about boiling water and making steam that turns a turbine. It is cheapest to burn the stuff, boil water and make steam.
“But Aina Koa Pono’s proposed process is extremely energy-intensive and expensive: It would make electricity to make microwaves to vaporize the cellulose to get the liquid and then take the pyrolysis oil, refine it to make it burnable, and then haul it down to Keahole in tanker trucks to make steam. Why should the ratepayer pay for all that?
“Cellulosic biofuels are not yet a cost-effective technology. On the mainland, in the middle of last year, the Environmental Protection Agency drastically decreased its 2011 estimate for cellulosic biofuel from 250 million gallons to a paltry 6 million gallons.
“In 2010, cellulosic biofuel companies on the mainland needed to buy their feedstock for $45/ton. But because farmers were earning $100/ton for hay, the biofuel firms received a $45/ton subsidy.
VOLCANO SCHOOL OF ARTS & SCIENCES holds a public meeting this evening at 6:30 p.m. at Cooper Center in Volcano Village. Architects will present renderings of the new campus buildings at Keakealani. Fundraising efforts will be discussed.
FUNDRAISING FOR KA`U HOSPITAL’S emergency room by the Red Hat Ladies of Ka`u and Ka Lae Quilters takes place a bake and craft sale Friday and Saturday at 8 a.m. at Punalu`u Beach Park pavilion. Contributions are welcome. Call Barbara Beatty at 929-9072.
ST. JUDE’S EPISCOPAL CHURCH in Ocean View holds its Mardi Gras celebration tomorrow, Friday at 6:30 p.m. with food, music and dancing. Tickets are $12 for one or $20 for two, with proceeds going to renew the Philippines Mission. Call 939-7555 for more information and tickets.
IN SPORTS, KA`U HIGH won its JV boys basketball game last night at home with a score of 49 to 41 over Kamehameha High School. Standout players were Chance Emmsley Ah Yee with 18 points and Kaimanu Medeiros Dancel with 12 points. Varsity fought hard against Kamehameha earning 53 points with Royden Esperon scoring 15 and Alexis Alejo and Donald Gar, Jr. each scoring ten. However, Kamehameha Warriors topped the Trojans with 68 points to win, reports Ka`u Athletic Director D. Kalei Namohala.
“There is also a risk that this process might use more energy than it generates. Generating electricity is generally about boiling water and making steam that turns a turbine. It is cheapest to burn the stuff, boil water and make steam.
“But Aina Koa Pono’s proposed process is extremely energy-intensive and expensive: It would make electricity to make microwaves to vaporize the cellulose to get the liquid and then take the pyrolysis oil, refine it to make it burnable, and then haul it down to Keahole in tanker trucks to make steam. Why should the ratepayer pay for all that?
“Cellulosic biofuels are not yet a cost-effective technology. On the mainland, in the middle of last year, the Environmental Protection Agency drastically decreased its 2011 estimate for cellulosic biofuel from 250 million gallons to a paltry 6 million gallons.
“In 2010, cellulosic biofuel companies on the mainland needed to buy their feedstock for $45/ton. But because farmers were earning $100/ton for hay, the biofuel firms received a $45/ton subsidy.
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| `Aina Koa Pono and its partner Sustainable Biofuels Solutions claim they will use a microwave process that will compress "to about an hour what in nature takes thousands, even millions of years." Image from www.biofuels-solutions.com |
“I asked how much AKP expected to pay for feedstock, and the AECOM Technology Corporation consultant said between $55 and $65/ton. The problem there is that Hawai`i farmers have been earning $200/ton for hay for 10 years now.
“There is an agricultural production risk, as well. Palm oil is the only industrial-scale biofuel that can compete with petroleum oil. AKP has 12,000 acres and it says it will produce 18 million gallons of biofuel annually, and another 6 million gallons of drop-in diesel. So it will produce 24 million gallons using 12,000 acres. That is 2,000 gallons per acre, and that is four times the production of palm oil. More likely they would need at least four times as much land, or 48,000 acres. But where?
“Consider too that Ka`u Sugar relied on natural rainfall, and it was one of the least productive of the sugar companies. There is a drought right now. And at 22 degrees N latitude, the area has less sun energy than the palm oil producers located on the equator.
"According to Energy Expert Robert Hirsch, in his book The Impending World Energy Mess, the best model for biofuel production is a circular one, where processing is done in the center of a field (which does not exceed a radius of 50 miles) consisting of flat land and deep fertile soil with irrigation and lots of sun energy. This situation exists in Central Maui, where Hawaiian Commercial & Sugar Company (HC&S) is located. It explains exactly why HC&S is the sole surviving Hawaii sugar plantation.
“There is an agricultural production risk, as well. Palm oil is the only industrial-scale biofuel that can compete with petroleum oil. AKP has 12,000 acres and it says it will produce 18 million gallons of biofuel annually, and another 6 million gallons of drop-in diesel. So it will produce 24 million gallons using 12,000 acres. That is 2,000 gallons per acre, and that is four times the production of palm oil. More likely they would need at least four times as much land, or 48,000 acres. But where?
“Consider too that Ka`u Sugar relied on natural rainfall, and it was one of the least productive of the sugar companies. There is a drought right now. And at 22 degrees N latitude, the area has less sun energy than the palm oil producers located on the equator.
"According to Energy Expert Robert Hirsch, in his book The Impending World Energy Mess, the best model for biofuel production is a circular one, where processing is done in the center of a field (which does not exceed a radius of 50 miles) consisting of flat land and deep fertile soil with irrigation and lots of sun energy. This situation exists in Central Maui, where Hawaiian Commercial & Sugar Company (HC&S) is located. It explains exactly why HC&S is the sole surviving Hawaii sugar plantation.
“To compete heads up in the world market would require the best possible combination of production factors. These are not them.
“It’s also important to consider that locking ourselves into a 20-year contract now would preclude lower cost alternatives. Geothermal, for example, is the equivalent of oil at $57/barrel. Ocean thermal has the possibility of being significantly lower in price than $200/barrel oil. LNG (Liquid Natural Gas) is on the radar and so is biomass gasification. Who knows what else would come up in 20 years?
Paul Brewbaker and Carl Bonham, both highly respected Council of Revenue members, have said, very emphatically and for awhile now, that low energy cost is critical. We should listen to them.
"The International Monetary Fund team modeled different oil supply scenarios and did a presentation at the Association for the Study of Peak Oil (ASPO) conference a month and a half ago. They could not model a constant $200/barrel oil. Those would be uncharted waters; and ones, by the way, that would devastate Hawai`i’s tourist industry. Why should we start paying $200/barrel for oil in 2015 if we don’t have to?
“It’s also important to consider that locking ourselves into a 20-year contract now would preclude lower cost alternatives. Geothermal, for example, is the equivalent of oil at $57/barrel. Ocean thermal has the possibility of being significantly lower in price than $200/barrel oil. LNG (Liquid Natural Gas) is on the radar and so is biomass gasification. Who knows what else would come up in 20 years?
Paul Brewbaker and Carl Bonham, both highly respected Council of Revenue members, have said, very emphatically and for awhile now, that low energy cost is critical. We should listen to them.
"The International Monetary Fund team modeled different oil supply scenarios and did a presentation at the Association for the Study of Peak Oil (ASPO) conference a month and a half ago. They could not model a constant $200/barrel oil. Those would be uncharted waters; and ones, by the way, that would devastate Hawai`i’s tourist industry. Why should we start paying $200/barrel for oil in 2015 if we don’t have to?
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| `Aina Koa Pono says it will bring an experimental unit to Hawai`i within within three months and start making biofuel to prove its process. Photo from www.ainakoapono.com |
"Five people from Hawai’i attended this year’s ASPO conference. Notably, Kamehameha Schools sent two high-level people. Next year, Hawai`i should send 20 people to learn what’s happening with oil prices and energy.
“In the meantime, the amount of risk involved in the AKP biofuels proposal is just far too great. In the investment world, reward is generally commensurate with risk. Except for protection from $200/barrel oil in later years, the AKP project would provide little reward for all the risk we rate payers would assume.
“This is a very, very bad deal for consumers. Big Island electricity rates have been 25 percent higher than O`ahu’s for as long as anyone can remember. This probably adds to the reason why the Big Island has the lowest median family income in the state, as well as the social ills that go with it. We need lower rates, not higher rates!
“Although this is not an official Big Island Community Coalition communication, I would like to point out that the BICC has been very instrumental in getting lots of people to stand up and say, “Enough is enough.”
“The BICC is a bare-bones, grass roots citizen group with some of the most recognizable names on the Big Island on its steering committee: Dave DeLuz Jr., John E K Dill, Rockne Freitas, Michelle Galimba, Richard Ha, Wallace Ishibashi Sr., Kuulei Kealoha Cooper, D. Noelani Kalipi, Kaiu Kimura, Robert Lindsey, H M Monty Richards, Marcia Sakai, Kumu Lehua Veincent and William Walter,” Ha reports.
`Aina Koa Pono has declined answering questions about its time line to cut trees and brush and begin planting in Ka`u. However, the company announced it will bring the first unit to Hawai`i within three months and could be operational next year. A PR statement by `Aina Koa Pono lauds that its new microwave depolymerization unit called a Micro Dee “can convert biomass into a crude oil using modular units of a microwave process, compressing to about an hour what in nature takes thousands, even millions of years.” The county has asked for proof of process, financing details and plans for the use of the ag land in Ka`u. Answers are due at the Public Utilities Commission by Feb. 15.
“In the meantime, the amount of risk involved in the AKP biofuels proposal is just far too great. In the investment world, reward is generally commensurate with risk. Except for protection from $200/barrel oil in later years, the AKP project would provide little reward for all the risk we rate payers would assume.
“This is a very, very bad deal for consumers. Big Island electricity rates have been 25 percent higher than O`ahu’s for as long as anyone can remember. This probably adds to the reason why the Big Island has the lowest median family income in the state, as well as the social ills that go with it. We need lower rates, not higher rates!
“Although this is not an official Big Island Community Coalition communication, I would like to point out that the BICC has been very instrumental in getting lots of people to stand up and say, “Enough is enough.”
“The BICC is a bare-bones, grass roots citizen group with some of the most recognizable names on the Big Island on its steering committee: Dave DeLuz Jr., John E K Dill, Rockne Freitas, Michelle Galimba, Richard Ha, Wallace Ishibashi Sr., Kuulei Kealoha Cooper, D. Noelani Kalipi, Kaiu Kimura, Robert Lindsey, H M Monty Richards, Marcia Sakai, Kumu Lehua Veincent and William Walter,” Ha reports.
`Aina Koa Pono has declined answering questions about its time line to cut trees and brush and begin planting in Ka`u. However, the company announced it will bring the first unit to Hawai`i within three months and could be operational next year. A PR statement by `Aina Koa Pono lauds that its new microwave depolymerization unit called a Micro Dee “can convert biomass into a crude oil using modular units of a microwave process, compressing to about an hour what in nature takes thousands, even millions of years.” The county has asked for proof of process, financing details and plans for the use of the ag land in Ka`u. Answers are due at the Public Utilities Commission by Feb. 15.
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| Theft from orchards and drying pads will be discussed at Monday's meeting. |
AGRICULTURAL THEFT will be discussed by County Prosecuting Attorney Mitch Roth at the Ka`u Farm Bureau meeting next Monday at 6 p.m. at Pahala Community Center. Theft of coffee from orchards and drying pads is reported to be on the rise as the demand outstrips the market. Some farmers are setting up camera and alarm systems in their locations and talking about a neighborhood watch for farms in order to catch the culprits. Roth has helped communities with crime sprees to help police monitor activities and break theft rings.
VOLCANO SCHOOL OF ARTS & SCIENCES holds a public meeting this evening at 6:30 p.m. at Cooper Center in Volcano Village. Architects will present renderings of the new campus buildings at Keakealani. Fundraising efforts will be discussed.
FUNDRAISING FOR KA`U HOSPITAL’S emergency room by the Red Hat Ladies of Ka`u and Ka Lae Quilters takes place a bake and craft sale Friday and Saturday at 8 a.m. at Punalu`u Beach Park pavilion. Contributions are welcome. Call Barbara Beatty at 929-9072.
ST. JUDE’S EPISCOPAL CHURCH in Ocean View holds its Mardi Gras celebration tomorrow, Friday at 6:30 p.m. with food, music and dancing. Tickets are $12 for one or $20 for two, with proceeds going to renew the Philippines Mission. Call 939-7555 for more information and tickets.
IN SPORTS, KA`U HIGH won its JV boys basketball game last night at home with a score of 49 to 41 over Kamehameha High School. Standout players were Chance Emmsley Ah Yee with 18 points and Kaimanu Medeiros Dancel with 12 points. Varsity fought hard against Kamehameha earning 53 points with Royden Esperon scoring 15 and Alexis Alejo and Donald Gar, Jr. each scoring ten. However, Kamehameha Warriors topped the Trojans with 68 points to win, reports Ka`u Athletic Director D. Kalei Namohala.
