The federal government is helping the state pay for costly upgrades to an old Navy electrical system at the former Barbers Point Naval Air Station in Kalaeloa.

Through an intergovernmental support agreement, the Navy is giving $18 million for upgrade work to the Hawaii Community Development Authority, a state agency that governs much of the former base that was closed in 1999 and largely transferred to state, city and private entities for reuse.

HCDA said the upgrades will allow Kalaeloa Airport and film studio facilities operated by the state, as well as the Hawaii Army National Guard, to get off the Navy electric system that dates to the 1930s and switch to improved infrastructure that will become part of the Hawaiian Electric grid when work is completed.

Rear Adm. Steve Barnett, Navy Region Hawaii commander, said the unique Navy-state partnership will benefit both parties.

“This effort will build stronger community relationships and support the community by starting the transition from Navy to HECO power in Kalaeloa,” he said in a statement.

According to HCDA, the 2024 National Defense Authorization Act requires the Navy to pay reasonable costs to transfer all customers from its old electrical distribution system at the former base. The intergovernmental support agreement allows military services and local or state governments to provide, receive or share installation support services when mutually beneficial.

The Navy received $18 million for an initial phase of Kalaeloa’s electric system upgrade work earlier this year through the 2024 fiscal year Consolidated Appropriations Act, HCDA said in a news release.

In the news release, Barnett described the unprecedented partnership between the Navy and HCDA as a mechanism now in place to continue the effort to transfer the Navy’s remaining customers off the old system.

“This is an encouraging start, and I’m pleased to see progress through partnership,” he said.

In 2023, the Navy funded work by Hawaiian Electric to develop a plan to replace the Navy-owned electrical system with a system owned and operated by the state-regulated utility. This work, HCDA said, is slated to be completed next summer.

For many years, the state and the Navy, along with some customers, have struggled with electric system conditions on the 3,700-acre former base.

In 2016, the Hawaii Army National Guard claimed that it was paying the Navy more than $600,000 a year for overly expensive electricity subject to periodic brownouts and power outages.

Hawaii lawmakers since then appropriated around $12.5 million for HCDA to build what it calls the Enterprise Energy Corridor, upgraded electric system infrastructure along Enterprise Avenue, that was completed around 2019 and transferred to Hawaiian Electric.

Last year, the Legislature appropriated $47 million to HCDA for upgrading electric utility infrastructure that is still part of the Navy system and intended for conveyance to Hawaiian Electric.

“It’s not reliable,” Craig Nakamoto, HCDA executive director, said at the time, referring to Kalaeloa’s electrical grid.