Power cost hike, supply crunch ahead as last Hawaii coal plant closes

HONOLULU (KHON2) — Hawaiian Electric (HECO) said Oahu residents should get ready to pay even more for electricity this fall. A massive coal power plant is closing, and renewable energy intended to replace it won’t be ready in time. Always Investigating has the details.

Coal is the cheapest but dirtiest source of power for Oahu, and a law put into place a couple years ago brings that to a hard stop Sept. 1, even though replacement power projects are behind schedule. That means consumers can cut back, try solar and batteries, or pay more for the oil-generated power that will have to patch the gap this fall. How much more is not yet known.

The Kapolei plant burns coal to make energy, meeting about 16% of the island’s peak electricity demand. It has been Oahu’s biggest single generator for three decades, but only for the next 69 days.

“By shutting down that coal plant, we’re also eliminating the last use of coal in the state of Hawaii for power generation,” explained Jim Kelly, vice president at HECO. “It’s one of the largest emitters of greenhouse gas in the state.”

Kelly estimated that the output of the AES coal plant was about 1.7 million metric tons of carbon dioxide per year but later corrected it to be 1.2 million metric tons of carbon dioxide.

Its closure on Sept. 1 will also eliminate 180 megawatts of power, about one-tenth of what Oahu needs. The original plan was to have a whole bunch of big renewable energy projects up and running just in time.

“One of the biggest challenges has been these unexpected global events with supply chain issues,” said Wayne Tanaka of the Sierra Club. “As a result, developers can’t necessarily fulfill some of the promises or commitments have been made over the past few months and years.”

Tariff issues also hung up solar panel imports. So how do we bridge the gap when the plug is pulled on coal?

“The lights are going to stay on, that’s our number one job,” Kelly said. “And on Sept. 1, there isn’t even going to be a blink.”

Kelly said that’s because HECO has rearranged the maintenance schedules to make sure all plants are up and running, creating what they call a “reserve margin” which is basically power they have on standby in case we need it. But how?

“Our oil powered units will be running more than they were before the shutdown of the coal plant,” Kelly said.

Always Investigating asked, what’s the cost differential on that for customers?

“You know, we’re starting we’re looking at that right now, and some of that is going to just depend. We’re forecasting that there is going to be an increase,” Kelly said. “The timing really is about as bad as it could be with the increase in oil prices. A year ago, when we were looking at this, we didn’t think there was going to be much of a difference at all.”

Coal right now costs 6 to 8 cents per kilowatt hour, but oil soared to 28 to 30 cents per kilowatt hour.

Meaning oil-generated power costs as much as five times more than coal. That’s the ballpark for the steep difference on the 10% or so of the island’s power that once came from coal but will need to be made up for with oil — until more utility-scale renewables come online as soon as early 2023.

“There is a cost associated to not burning coal, it is the cheapest fuel, but it’s also the dirtiest,” Kelly said. “It’s the right thing to do, but it’s not always the easy thing to do.”

So what can we do about it at home besides getting ready to write bigger checks to HECO?

If you have solar at home, get on the program for the battery bonus, where you agree to use your own power or export to the grid during the peaks. Uptake of that has been a little slow.

“The program has opened up to 50 megawatts, and we know there’s more in the pipeline coming,” Kelly said. “So that’s really important. Every single resident can help provide energy on Oahu. That’s super helpful.”

Also, just use less power, this while the island also is asked to cut back on water.

“Really be embracing the idea of conservation,” Kelly said. “As well as being mindful between 5 p.m. and 9 p.m., which is when the peak is. We ask people to help to not be cranking on the air conditioner, taking 15-minute showers, running in the oven, running your pottery kiln, whatever it might be.”

“There obviously have to be some very tough decisions as to the kinds of sacrifices you may need to make to keep the lights on,” Tanaka said. “Especially in the places in the institutions that really need them.”

To that end, HECO has recently reached out to big power users and makers to plead for help.

“We work closely with the Board of Water Supply on when they run their pumping stations and that kind of thing,” Kelly said. “We work with the military; they have a number of generators that they use themselves. We also just talked to large businesses to see if we need them to say — ‘hey, can you reduce your use between five and nine? Can you shut off your chiller for an hour?’”

We reached out to the coal plant operator AES, which also runs and develops several renewable projects, and we asked the state’s consumer advocate for his take on the upcoming power crunch. We’ll report back with their responses in a follow-up story.