HomeMy WebLinkAboutRES 297 Draft 01 2010-2012 COUNTY OF HAWAII STATE OF HAWAII
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RESOLUTION NO. 297 12
A RESOLUTION URGING HAWAII ELECTRIC LIGHT COMPANY TO
RENEGOTIATE ITS PURCHASE POWER AGREEMENT CONTRACTS WITH ALL
INDEPENDENT POWER PRODUCERS USING RENEWABLE RESOURCES SO THAT
THE COST TO THE CONSUMER IS NOT BASED ON AVOIDED COSTS.
WHEREAS, a Purchase Power Agreement is a legal contract between an independent
power producer and a power purchaser (Hawai`i Electric Light Company) and defines all of the
commercial terms for the sale of electricity between the two parties; and
WHEREAS, avoided cost is the cost the utility would have incurred had it supplied the
power itself or obtained it from another source; and
WHEREAS, on December 30, 2011, the Public Utilities Commission approved an
amended Purchase Power Agreement between Hawai`i Electric Light Company (HELCO) and
Puna Geothermal Venture (PGV) to allow HELCO to purchase an additional 8 megawatts (MW)
from PGV for a total of 38 MW of on-peak firm capacity; and
WHEREAS, HELCO estimates that the proposed 8 MW expansion project will reduce
the monthly bill of a typical HELCO residential customer by approximately -$1.67 for 2015,
-$1.89 for 2020, and -$1.61 for 2025; and
WHEREAS, although the Public Utilities Commission approved the amended Purchase
Power Agreement, it was disappointed that HELCO and PGV were unable to negotiate an
increased reduction in the avoided cost-based payments that PGV will receive, and as a
consequence, the vast majority of the annual energy procured from the existing facility would
still occur at pricing that is linked to fossil fuels and, thus, provides no price advantage or
stability benefits to HELCO's customers; and
WHEREAS, the Public Utilities Commission further stated that the 8 MW expansion
was the opportunity to renegotiate the underlying contract terms for the existing facility, but
HELCO and PGV failed to produce a better economic result for customers; and
WHEREAS, HELCO also has Purchase Power Agreements with other independent
power producers that are paid at avoided cost that include Apollo Energy Corporation/Tawhiri
Power, LLC (wind farm), Wailuku Holding Company, LLC (hydroelectric), and enXco/Hawi
Renewable Development, LLC (wind farm); now, therefore,
BE IT RESOLVED BY THE COUNCIL OF THE COUNTY OF HAWAII that it
hereby urges Hawai`i Electric Light Company to renegotiate its Purchase Power Agreement
contracts with all independent power producers using renewable resources so that pricing is not
based on avoided costs to ensure that the residents of Hawai`i County receive increased savings
on their electric bills.
BE IT FINALLY RESOLVED that the County Clerk shall forward a copy of this
resolution to the Honorable Mayor William P. Kenoi; Jay Ignacio, President of HELCO; Paul
Thomsen, Director of Ormat/PGV; Dennis Melstad, President of Wailuku Holding Company,
LLC; Steven Pace, Apollo Energy Corporation/Tawhiri Power, LLC; Richard Horn, Chief
Operating Officer of Hawi Renewable Development, LLC; Jay L. Temple, Asset Manager of
enXco; and Public Utilities Commission Chair Hermina Morita.
Dated at , Hawai`i, this day of , 2012.
INTRODUCED BY:
„ 1111111111.'
CIL MEMBER, COUNTY OF HAWAI`I
COUNTY COUNCIL ROLL CALL VOTE
County of Hawai`i AYES NOES ABS EX
Hilo, Hawai`i BLAB
FORD
I hereby certify that the foregoing RESOLUTION was by HOFFMANN
the vote indicated to the right hereof adopted by the COUNCIL of the IKEDA
County of Hawai`i on
ONISHI
PILAGO
ATTEST: SMART
YAGONG
YOSHIMOTO
Reference: C-822/AWESC-
COUNTY CLERK CHAIRPERSON&PRESIDING OFFICER RESOLUTION NO. 297 12
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