HONOLULU (KHON2) — Get ready to pay more for electricity. Hawaiian Electric said rate hikes are set to begin in October. It all has to do with how Hawaii gets its energy.
The state’s last coal plant is set to close soon, and new renewable energy sources are lagging behind.
Seven of Hawaii’s renewable energy projects that were supposed to replace coal were delayed until at least 2023, meaning Honolulu will be running that portion of the electric grid on oil and its volatile market.
Government data for May showed that Hawaii pays 37% more than the second most expensive state, California, when it comes to electricity. Hawaii’s rates are 65% higher than the national average.
When the AES coal plant closes on Sept. 1, there will be a puka for HECO customers on Oahu to pay an anticipated 7% more on their bills starting in October.
“Electricity is a necessity, it’s not one of those maybe I’ll go cook by fire for the next month it’s a necessity that we have and it’s just terrible that government and private industries have put Hawaii in this position where people are going to be paying $15 more a month,” Hawaii State Senate Energy, Economic Development, and Tourism Chairman Glenn Wakai said.
HECO said that the plant was required to close by law as coal produces more carbon emissions than even oil.
“Bottom line is we’ve seen with the example in Kauai is the faster you can switch to renewable energy, the better you can control your prices and have more reliable energy,” Hawaii State Energy Office Chief Energy Officer Scott Glenn said. “So that’s the goal. That’s what we’re headed toward.”
Sen. Wakai said he tried to get Act 23, which banned the extension of the AES plant to use coal, to make concessions as he saw renewable projects being delayed.
“I talked to AES, I talked to HECO I talked to the environmentalists I got no traction on the idea of not repealing the law but giving HECO some flexibility to extend past September of this year,” Sen. Wakai said. “There was no interest back then.”
But according to Glenn, keeping the coal plant online was not simple.
“There’s a whole lot of steps that get put into motion to retire a power plant that aren’t really reversible once you start them,” Glenn said.
The other thing is that when you look at a coal plant, for example, it has a shelf life. And we’re at the end of that shelf life. It was made to last 30 years, it was maintained to last 30 years, and as we’ve moved into the final stretch the maintenance costs have increased dramatically. So we’re not necessarily getting the same price of coal that we would be in a couple of months’ extension. We might be looking at millions of dollars more for that couple of months of extension, in which case it’s no longer the cheapest.”Scott Glenn, Hawaii State Energy Office Chief Energy Officer
There is help on the way. Wakai said the $300 refund checks from the state’s budget surplus are set to go out in October. HECO points to renewables being less volatile than fossil fuels.
HECO Spokesman Jim Kelly stated:
“Renewable energy projects provide long-term price stability – they’re locked in at a contracted price, typically ranging from 9 to 13 cents per kilowatt-hour for solar and storage on O’ahu. That’s less than half the current cost of oil used for power generation, which is about 30 cents per kilowatt-hour. As more of these projects come online (nine new projects online by 2024 on Oahu), they will help insulate Hawai’i from the oil price spikes driven by international events.”
Many of the renewable projects have been delayed by COVID shutdowns in China, but also permitting hurdles.
“For the long term, we really need to put our foot on the accelerator and get these renewable projects out the door quicker. The permitting process is too cumbersome and HECO is partially to blame too,” Sen. Wakai said. “There’s this issue called interconnection, once you put the power plant up it takes HECO a while to say yes developer you can send me your surge of power, HECO still holds the key to that part of it. We need to hasten the permitting process and hasten the interconnection process.”
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Until the renewables go online HECO and others are advising to watch electric usage. There are plenty of standard tips like turning off lights and turning up the thermostat, but there are also outside-of-the-box savings ideas that can make a big difference on your electric bill.