Honua Ola Bioenergy said in a filing submitted to the state Public Utilities Commission on Sunday that it will start laying off employees if the agency is unable to make a decision by Sept. 30 regarding the fate of the company’s biomass plant in Pepeekeo on the Big Island.
The company filed a
motion for reconsideration with the PUC on July 20 after the agency terminated an amended power purchase agreement with Hawaii Electric Light Co., a Hawaiian Electric subsidiary, allowing the utility to buy power that would be produced by burning eucalyptus trees growing along the Hamakua Coast as well as other timber.
Honua claimed in its reconsideration motion that the PUC’s July 9 order exceeded the Hawaii Supreme Court’s instructions when it remanded the case to the PUC in 2019 following a successful appeal by nonprofit environmental group Life
of the Land.
The company has said that if it is prevented from operating, 64 current employees will be laid off, and 145 future ancillary positions will be lost. It has spent more than six years and about $474 million building the biomass plant, which is now 99% completed.
“Given that the Commission has not given Hu Honua any indication to date whether there will be a possible path forward for the Project, Hu Honua (formerly known by that name) has no choice but to consider when it will have to start laying off its employees,” the filing said.
Honua’s filing on Sunday was a response to replies filed by the Consumer Advocate, Tawhiri Power LLC and Life of the Land that sided with the PUC’s decision.
The Consumer Advocate argued that Honua’s motion for reconsideration fails to meet the applicable standard for relief because it appears to present no new evidence or arguments that were unable to be presented earlier. Tawhiri argued that Honua’s reconsideration motion improperly introduces new evidence in an attempt to relitigate the case. And Life of the Land claims that Hu Honua is trying to supplement the record for the purposes of appeal.
Honua said in its response that it disputes all those arguments and that it appropriately introduced new evidence pursuant to Hawaii Administrative Rules to address erroneous and unsupported justifications advanced by the PUC to support its order revoking the waiver.
The PUC was put in the position of once again ruling on the Honua power purchase agreement after its 2017 approval of the deal between HELCO and Honua was challenged by Life of the Land, which argued the PUC violated state law when it
approved the agreement.
In May 2019 the state Supreme Court agreed and rejected the deal between HELCO and Honua, writing in its order that when the PUC approved the power purchase agreement, it failed to “explicitly consider” the state’s goal of reducing greenhouse gases, which is required under state law. The PUC’s decision was vacated, and the case was remanded to the PUC to consider the emission of greenhouse gases in its decision and to allow Life of the Land to be part of the proceedings.
Upon reexamining the case, the PUC revoked the previously approved 2017 request from HELCO to waive competitive bidding for the project because the Supreme Court vacated the overall decision.
PUC chief counsel Caroline Ishida said following
the revocation that because the PUC denied HELCO’s
request for a waiver from competitive bidding, consideration of the project’s greenhouse gas emissions was rendered moot. She also cited the project’s monthly bill increases for HELCO’s customers and the long-term impacts of a 30-year contract with a cost premium of 2-3 times over other renewable energy sources with similar operational characteristics.
Honua said in Sunday’s filing that the PUC issued its order terminating the agreement before HELCO could submit a bill impact analysis to the PUC that included a changed assumption regarding the 30-year fuel forecast.
“Submitting an additional bill impact analysis would inform the Commission of another estimate of customer bill impacts using reasonable alternative assumptions that would demonstrate a lower bill impact than an average net increase of $10.97 (and a lower delta than the $13.47 difference between the 2017 and 2020 analyses),” Honua President Warren Lee said in an affidavit attached to the filing.
