HomeMy WebLinkAboutCOM 0825.057 2010-2012 PUNA
GEOTHERMAL VENTURE
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October 30, 2012 a
Chairman Dominic Yagong - 4
Hawaii County Council
Re: Bill 292 -2
Dear Chairman Yagong and Members of the Council: o-
With the upcoming public hearing on Friday November 2, PGV would like to reiterate its
concerns with Bill 292 that have been echoed by other experts in the industry. For your
convenience we are attaching testimonies that have been submitted to the Council that align with
our position.
PGV had and continues to have three principal concerns about Bill 292, Draft 1,which requires
us to oppose this bill.
First concern: Stopping drilling at night will not elevate the sound produced from mandatory
equipment that must run for the entirety of drilling. We are concerned that the delay caused by
this bill will infuriate the local community.
October 16,2012 E-Mail testimony from Hawaii Island Chamber of Commerce(HICC). This
testimony opposes Bill 292.
October 16,2012 Testimony from Japanese Chamber of Commerce and Industry of Hawaii
(JCCIH). This testimony opposes Bill 292.
Second Concern: This bill has not fully explored drilling operation procedures and protocols
which are required by law and designed to assure the safety of the well, men and equipment for
all drilling operations.
September 30,2012 E-Mail Testimony from Hank Banquer. This testimony summarizes the
dangers which Bill 292 can generate to men, equipment and the community, and risks which Bill
292 poses to well integrity for the sake of nominal reduction in noise reduction, increased drilling
periods and substantially increased cost. Mr. Banquer is a person with 35 years of extensive
drilling experience.
October 12,2012 Memorandum from Geothermex to DLNR and DBEBT. This memorandum
provides a detailed explanation of the risks which Bill 292 poses to well integrity. In an October
24, 2012 telephone conference with Chairman Yagong, DLNR,DBEBT and others, Geothermex
representative James Lovekin provided further analysis of the issues which Bill 292 creates for
the community. p
Comm. NQ o 2.. . 51
Ref. To: S2
Ref. Date
October 12,2012 Letter from Department of Business,Economic Development Tourism
(DBEBT). This letter summarizes the numerous regulations which PGV must comply with to
assure safety of drilling operations, and the effect which Bill 292 will have on costs and rates, a
matter which the public has vociferously weighed in on in recent PUC hearings.
October 17,2012 E-Mail from Department of Land and Natural Resources (DLNR). The e-
mail echoes safety concerns, includes the Geothermex report, and offers DLNR's input on the
implications of Bill 292.
Final Concern: This bill has not thoroughly resolved items raised by Corporation Counsel
regarding existing entitlements and jurisdictional issues. Corporation Counsel's on-record
discussions have confirmed our concerns about the Council's attempt to interfere with PGV's
operations.
Despite our opposition to Bill 292, PGV/Ormat has listened to the community's concerns and
has committed to using additional sound attenuation devices.
Sound Barrier Configurations and Muffler Information. This information has been provided
from PGV/Ormat to Chairman Yagong before and after October 17, 2012 hearing, depicting the
types of sound attenuation devices which PGV/Ormat is reviewing in future maintenance or
drilling operations.
Passing Bill 292 is not consistent with safe drilling practices, will not serve to substantially
reduce noise, and will greatly increase costs to ratepayers. Geothermal power has the potential
to provide the most inexpensive renewable energy on the Big Island. Bill 292 would severely
compromise this potential. For these and reasons stated previously, we ask that Bill 292 be
withdrawn, or not be adopted.
If you should have any questions,please do not hesitate to let us know.
Warm regards,
....•t A. It -.__.
Paul Thomsen
Director
775.313.6569
pthomsen @ormat.com
cc: HICC
JCCIH
Press
Office of the Mayor
October 16, 2012
Hawaii County Council
do Office of the County Clerk
County of Hawaii
25 Aupuni St.
Hilo, HI 96720
Re: Testimony on County of Hawaii Bill No. 292, Relating to Geothermal Drilling
Dear Hawaii County Council Members:
On behalf of the Japanese Chamber of Commerce and Industry of Hawaii (JCCIH), we
would like to urge the Council to oppose Hawaii Bill No. 292, as we believe it will result
in increased costs and delays in our county's efforts to reduce energy costs and become
more energy self—sufficient on our island.
While we understand the importance of addressing community concerns and protecting
the health and welfare of our residents, we believe that other available industry measures
designed to mitigate noise and lighting issues should be pursued first. Daily drilling
stoppages will result in increased costs, which will be passed on to payers at a time when
our county is diligently exploring ways to reduce energy costs for our island.
Finally, we believe that further regulation of this industry and others that might want to
do business in Hawaii County in the future will view this increased regulation as a reason
not to come here, resulting in the loss many potential jobs and economic benefits that our
island so desperately needs.
Thank you for this opportunity to provide this testimony. We urge your opposition to
Bill No. 292 so that as an island community, we can continue our efforts toward energy
sustainability.
Sincerely,
Jon J. Arizumi, President Carol A. VanCamp, Chair
JCCIH Government Affairs Committee, JCCIH
t 117 Keawe Street,Suite 205
Hawaii Island Hilo,Hawaii 96720-2851
Z Phone:(8o8)935-7178
11.1 `` b Fax: (808)961-4435
Chamber of Commerce E-mail:admin @hicc.biz
0: tp�NE www.hicc.biz
October 16, 2012
2012-2013 Board Via email(counciltestimonyna,,co.hawaii.hi.us), Fax (961-8912)and U.S. Mail
President Dominic Yagong, Chairperson and Members of the Hawai`i County Council
Vaughn Cook
25 Aupuni Street
President-Elect Hilo, Hawai`i 96720
Judith Fox-Goldstein
Vice President Dear Chair Yagong and Council Members:
Chuck Erskine
Treasurer RE: Statement in Opposition to Bill 292 (Geothermal Drilling Kimura
Restrictions)
Past President
Jon Miyata
Thank you for the opportunity to address the Council on an issue that is
Directors important to all who live on our Island.
Howard Ainsley
Russell Chin With more than 230 member businesses and over 500 member representatives,
Jackie De Luz the Chamber serves as the voice of business on the Big Island.
Watanabe
Jay Ignacio Energy is the lifeblood of business. The Chamber supports the development of
Michael Kaleikini locally produced renewable energy that increases our energy security from
Randall Kurohara reliance on foreign, imported oil. The Chamber also supports development of
Keith Marrack
Tani Matsubara cost-effective renewable energy resources that not only increase locally
Donn Mende produced power but also allow our local businesses to thrive by having a
Eugene Nishimura regular,dependable source of inexpensive energy. We believe that geothermal
Spencer Oliver energy has developed into a reliable source of energy that can be cost
Glenn Santos competitive with oil and other renewable energy resources and support its
Wesley Segawa further expansion.
Alice Sledge
Donald Straney Bill 292 propose to restrict geothermal drilling operations within one mile or
Art Taniguchi
Barry Taniguchi less of a residence to the hours of 7:00 am to 7:00 pm. This restriction of
Misti Tyrin overbroad and threatens to have negative consequences to businesses and
Steve Ueda residences alike.
Carol VanCamp
William Walter We appreciate the Council's concern over light and noise issues raised by
Noreen Yamane community members living near geothermal drilling sites. There are already
regulations in place that should protect the health safety welfare and morals of
the community. Imposing such a blanket restriction on drilling operations
. . 117 Keawe Street,Suite 205
,i4 ce Hawaii Island Hilo,Hawaii 96720-2851
Phone: (808)935-7178
b Chamber of Commerce Fax:(808)961-4435
DER on Email:admin@hicc.biz
' www.hicc.biz
would likely increase the time needed to drill geothermal wells as well as the electricity rates that
must be paid by all ratepayers.
The restrictions imposed on the use and enjoyment of private property should not be imposed
without considering whether there are less restrictive means to achieve the important goals of the
proposed restrictions.
The Chamber therefore opposes passage of this bill. We urge the Council to support geothermal
energy development for the benefit of all members of our community.
Very Truly Yours,
HAWAII ISLAND CHAMBER OF COMMERCE
Vaughn G. T. Cook
President
From: Hank Banquer <hbanquer @earthlink.net>
Date: 30 September 2012 2:25:09 PM CDT
To: counciltestimonv @co.hawaii.hi.us
Cc: Steve Burns <dreaminto @hotmail.com>,Richard Ha
<richard @hamakuasprings.com>, Aziani Ismail <aziani.ismail @qmail.com>
Subject: Bill 292, Draft 1 Testimony
To the County Council
As a member of the Big Island Energy Advisor Commission(EAC) and having spent 35
years in the drilling industry I think this proposal to stop drilling at night is absurd.
Firstly drilling has gone on and continues to go on in densely settled areas with little problem
with noise. Some noise abatement practices can be adopted to reduce the noise but in
general 24 hour drilling is practiced everywhere including in down town Los Angeles where
it has gone on unnoticed for decades and in a state (California) where the environmental
laws are the strictest, infact are often the benchmark for many practicises and even federal
policies.
There are dangers, major delays and ultimately cost implications in doing this.
You just can not stop drilling, circulating or stop operating realistically for several reasons.
1. Control of the well
2. Temperature build up.
There are 2 temperatures we deal with while drilling:
a. Static temperature
b. Circulating temperature
If the hole is left static for 12 hours then there are many issue that would need to be dealt
with that raise the cost, safety and/or viability of drilling.
3. Time lost and the time to drill the hole would not be 2 times longer but infact maybe 3-4
times longer
4. Open hole (not cased hole) dynamic conditions which can result in stuck pipe, redrilling
2 of 4 111/1/911»-7•in AM
FW:Bill 292,Draft 1 Testimony
or reaming of the open hole.
5. Having to trip(run the pipe in and out of the well bore)once every 12 hours would leave
little time to drill and just expose the well bore,crew and environment to more risks.
6. Tripping the pipe into the casing where it is protected while drilling is stopped or pulling
the drill pipe out of the hole completely takes time and is particularly noisey as you are
handling the drill pipe in and out of the hole. This can be mitigated with certain pipe
handling equipment but it is still not "quiet"
7. Engine noise can be mitigate many ways from sound proofing to using a diesel electric rig
where the engines run at a constant speed as opposed to changing RPM as the draw works
(large winch)pulls the pipe in or out.
8. The bangs and clangs associated with drilling can be also mitigated with some basic
measures and training of the drill crew.
My question is there a db sound level and duration that has been set that is acceptable for
day and night?
Often the db levels are set at max. exposure time not peaks that might occur in industrial
situations.
Have we taken sound data and reviewed this 2 ways real time including sound spikes and
average sound level over a period of time ie: 12 hours or whatever is specified and the
defining of"night time" which makes me wonder what you consider night time (sun down to
sun up which changes throughout the year or average bed time to waking time?
I have drilled in the UK Midlands and we had to keep noise levels to acceptable levels not
for the farmers but not to disturb the cows! The measurement here was whether milk
production decreased if the cows heard noises that were not common, constant or
unexpected. Here simply making sound walls from baled hay stopped the noise and we went
about our business drilling and the cows made milk!
In my view really what this resolution is all about. It is an attempt to shut down the
development of Geothermal making a side attack. Basically the sponsors of this resolution
(bill) want to stop the drilling. They will try any approach or any method to do this.
I think Mr. Yagong and those supporting this resolution(bill) are very uninformed and have
not even done the basic research to establish the noise level or what could be done by the
drilling contractor to reduce any noise. Drilling is just a temporary situation and I do not
know how many private and public construction jobs I have had to put up with over the last
50 plus years hearing jack hammers to banging of beams and diesel engines running
bothered me but we lived through it and enjoyed the benefits these construction projects
brought to us. We need to look at a what sometimes is a little inconvenience and maybe
even discomfort we as an island community need to consider the long term benefits to
ourselves and our fellow islanders.
Really are we going to let a short term inconvenience for some punish the rest of us on the
island?We need to start thinking what is best for our island not a few individuals whose goal
is to stop development of a local resource because they are slightly temporarily
inconvenienced.
I see the same people trying to stop the development of Geothermal by trying every tactic
they can. Is the council concerned about a small special interest group or the good of our
3 of 4 10/2/2012 7:10 AM
FW: Bill 292,Draft I Testimony
island and the people who live here.
Should any council member or individual in our community want to contact me regarding
the specifics of drilling or want to take advantage of my 35 years experience in the drilling,
energy exploration and production please feel free to.
Regards
H.Y. Banquer
Hank Banquer
Landline: 808-985-9266
Mobile: 808-990-5419
hbanquer@earthlink.net
Hank Banquer
Landline: 808-985-9266
Mobile: 808-990-5419
hbanquer@earthlink.net
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4of4 10/2/20127:10 AM
G eother�Ex 3260 BLUME DRIVE,SUITE 220
j�((�■ / RICHMOND.CALIFORNIA 94806 USA
A Schlumberger Company PHONE: (510)527-9876
FAX: (510)527-8164
www geothermex.com
MEMORANDUM
To: Carty Chang Date: 12 October 2012
Chief Engineer
Department of Land and Natural Resources
State of Hawaii
carty.s.chang @hawaii.gov
cc: Cameron Black
Hawaii State Energy Office
Department of Business, Economic Development& Tourism
State of Hawaii
Cameron.B.Black @dbedt.hawaii.gov
From: James Lovekin and Eduardo Granados
Subject: Potential Effects of Restrictions on Night-Time Drilling of Geothermal Wells
Per your request, GeothermEx has investigated questions posed by the Department of
Business, Economic, Development and Tourism (DBEDT) regarding the potential effects of
restrictions on night-time drilling of geothermal wells. We have considered this topic from the
point of view of the additional time and costs that restrictions on night-time drilling would
incur. We have also conducted a brief literature search to locate references related to this
topic.
GeothermEx estimates that a well drilled with 12-hour restrictions at night will take about three
times as long to drill as a well without such restrictions. The reason is that, when drilling
operations are shut down, safety requires that the drilling bit be pulled out of the hole. This
process can take several hours, depending on the depth of the hole. At the start of drilling
operations the next day, the bit must be run back into the hole, which can also take several
hours. The net effect is that the nominal 12-hour drilling day would get reduced to only about 8
hours of effective drilling. Furthermore, hole stability would likely be jeopardized during the
shut-down period due to the additional exposure time of the formation to drilling mud, which
can result in de-stabilization of the wellbore wall, especially in hydrothermally altered
geothermal zones. Thus, the estimate of 8 hours of effective drilling out or a nominal 12-hour
drilling day is probably optimistic, since it doesn't account for extra time to recover from hole
stability problems.
The tables and diagrams in Appendix A show a breakdown of drilling time and cost for a typical
Page 1 of 2
G ec therm Ex 3260 BLUME DRIVE,SUITE 220
RICHMOND.CALIFORNIA 94806 USA
A Schlumberger Company PHONE: (510)527-9876
FAX: (510)527-8164
www geothermex corn
6,000-foot geothermal well drilled in the mainland US, both as it would normally be drilled
(without time restrictions) and for a hypothetical case with 12-hour drilling restrictions at night.
The ratio of drilling duration for restricted vs unrestricted wells is estimated at three-to-one, for
the reasons discussed above. The illustrative drilling costs for these two cases are not
necessarily indicative of actual drilling costs in Hawaii —actual drilling costs depend on a variety
of factors, including geologic conditions and rig availability— but the cost ratio of the two cases
can be considered representative to a first approximation for a range of drilling conditions,
including those typical of Hawaii. This example shows that a well drilled with 12-hour night-
time restrictions can be expected to cost roughly twice as much as a well without such
restrictions.
Appendix B includes an Excel worksheet of references GeothermEx has located in our brief
literature search. We are unaware of any jurisdiction worldwide that has placed a blanket
prohibition on drilling at night. There are instances of oil fields in urban areas (such as Long
Beach, California) where extensive sound-proofing and camouflage have been employed to
allow drilling and well-maintenance activities to continue in close proximity to human
habitation. In the Long Beach example, there are night-time restrictions on certain drilling-
related activities (such as hammering on pipe or the racking of pipe). However, even at Long
Beach, the regulations allow for "on-bottom" drilling to continue around the clock. Sound-
proofing and light-shielding technologies exist that allow drilling activities to be compatible with
rural and touristic environments as well -for example, in the Lardarello area of Italy (Lazzarotto
and Sabatelli, 2005). The need for such technologies should be assessed based on site-specific
conditions, because noise-proofing and light shielding equipment also add to the cost of
drilling. However, they may be appropriate in some settings in Hawaii, and they would have
much less cost impact than a prohibition on night-time drilling.
Page 2 of 2
G eotherrn Ex 3260 BLUME DRIVE,SUITE 220
RICHMOND,CALIFORNIA 94806 USA
A Schlumberger Company PHONE: (510)527-9876
FAX: (510)527-8164
www.geothermex.com
APPENDIX A
Drilling Costs With and Without Night-Time Restrictions
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0 10 20 30 40 50 60 70 80 90 100 110 120 130 140
Time (Days)
GeothermEx, Inc.
2012
GeothermEx 3260 BLUME DRIVE,SUITE 220
RICHMOND,CALIFORNIA 94806 USA
A Schlumberger Company PHONE: (510)527-9876
FAX: (510)527-8164
www.geothermex.com
APPENDIX B
Preliminary Literature Review of Night-Time Drilling Restrictions
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„C
NEIL ABERCROMBIE
.-p F .y 9 GOVERNOR
4 °a 15 59.:..\9i RICHARD C.LIM
i 44``��� ` q y • DEPARTMENT OF BUSINESS, DIRECTOR
ECONOMIC DEVELOPMENT & TOURISM MARYALtCEEVANS
�1, ,��3,y�r(f j DEPUTY DIRECTOR
rt
. ? Telephone (808)587-3807
,� ,x.,. ,,r�%� STRATEGIC INDUSTRIES DIVISION P
i. 235 South Beretania Street,Leiopapa A Kamehameha Bldg.,5"'Floor,Honolulu,Hawaii 96813 Fax (808)588-2538
�� -— Mailing Address P.O.Box 2359,Honolulu,Hawaii 96804
Web site mew.hawaii.gavtdbedt
October 12,2012
Honorable Hawaii County Council
c/o Office of the County Clerk
County of Hawai`i
25 Aupuni Street
Hilo, Hawaii 96720
Subject: Testimony on County of Hawai`i Bill No. 292, Relating to Geothermal Drilling
Dear Hawaii County Council Members,
Thank you for the opportunity to provide comments on Bill 292,which proposes to
amend Chapter 14, General Welfare, Hawaii County Code 1983 (2005 Edition,as amended),by
adding new definitions and restricting geothermal drilling operations within one mile or less
from a residence to the operating hours of 7:00 a.m. to 7:00 p.m.
We appreciate the Council's efforts to address noise and light concerns raised by
community members residing near geothermal drilling operations. To protect human health,
every drilling and production operation in Hawaii County must at all times comply with county,
state, and federal laws regulating noise, light, air, water, and other emissions. In addition to these
regulatory protections,common industry measures may be implemented to significantly dampen
the magnitude of noise and light, such as noise shields around drilling operations and equipment,
noise mufflers,directional lighting, lighting shields,and/or monitoring near residences.'
According to geothermal industry and research experts consulted,daily stoppages of
geothermal drilling operations can more than double well drill times as withdrawal of drilling
equipment from the well may be needed to reduce the risk of caving, equipment loss,and fluid
instability. Increased well drill time will extend the project development period and augment
project costs. Given facility development costs are factored into the rate at which a geothermal
facility sells power to the utility,higher project costs will result in higher electricity costs to the
ratepayer.
1 A Guide to Geothermal Energy and the Environment,p.41-43,Geothermal Energy Association(2007).
4
Honorable Hawai`i County Council
October 12, 2012
Page 2 of 2
Geothermal energy has become an important component of Hawaii County's energy
portfolio, providing over 232,906 megawatt-hours of electricity in 2011; 21.10% of the
electricity distributed by the Hawaii. Electric Light Company (HELCO)that year.2 This does not
include the recently added 8 megawatts (MW)—bringing the total power plant size to 38 MW —
HELCO is purchasing from Puna Geothermal Venture at rates HELCO estimates will reduce
customer electricity bills through 2025.3
Thank you for the opportunity to comment on Bill 292. Please do not hesitate to contact
Andrea Gill, Geothermal Specialist, from my office if you would like to discuss further. Andrea
can be reached by email at agill'Adbedthawai i.go‘ or phone at 808-933-0312.
Sincerely,
•
Mark B.B. Glick, Administrator
Hawai`i State Energy Office
Cc: Andrea Gill, Geothermal Specialist, Hawai`i State Energy Office
2 Renewable Portfolio Standard Status Report for the year ended December 31, 2011,Hawaiian Electric Company,
Inc.(May 4,2012).
3 Decision and Order No. 30088,Docket No.2011-0040,Public Utilities Commission of the State of Hawaii(Dec.
30,2011).
•
I
From: Carty.S.Chang @hawaii.gov [mailto:Carty.S.Chang @hawaii.gov]
Sent: Wednesday, October 17, 2012 11:26 AM
To: soffenbacker @co.hawaii.hi.us
Cc:Alyson.K.Yim @hawaii.gov; Paul.J.Conry@hawaii.gov; william.j.aila @hawaii.gov;
Cameron.B.Black @dbedt.hawaii.gov; Susan.N.Richey @hawaii.gov; dnakano @brwncald.com;
AGill @dbedt.hawaii.gov; dthomas @soest.hawaii.edu
Subject: Bill 292 Comments from DLNR's consultant
Aloha Steve,
It was nice talking to you this morning. As discussed and as requested, here is a report from a third party
consultant (GeothermEx), who we asked to comment on the ramifications of the proposed Bill 292 that would
restrict geothermal well drilling operations (within one mile or less from a residence)to the hours of 7am and 7pm.
One of DLNR's role is to regulate geothermal well drilling for the purpose of ensuring compliance with well drilling
standards, protecting public safety and the environment. We would be concerned on any potential impacts these
restrictions may have on well drilling operations (i.e. hole stability, caving etc) or potential safety issues that may
result as an unintended consequence, particularly when drilling near the resource zone.
I would also suggest speaking to DOH as they have regulatory oversight with regards to noise and may have
suggestions on how to mitigate these impacts without having to restrict drilling operations at night.
Please distribute this information to other councilmembers so they are aware of the potential consequences of the
measure with respect to cost, schedule, and potential safety issues.
Please let us know if Councilchair Yagong or any other councilmember would like to discuss DLNR's role or
implications of these proposed restrictions. I also attached State of Hawaii DBEDT's testimony fyi. Mahalo!
********, **************************************************.***
Carty Chang, P.E.
Chief Engineer
Department of Land and Natural Resources
Engineering Division
Phone: (808) 587-0230, Fax: (808) 587-0283
Email: carty.s.chanq@hawaii.gov
1 of 2 10/18/2012 6:53 AM
FW: Bill 292 Comments from DLNR's consultant
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—Attachments:
2012-10-12 GeothermEx memo on effects of restrictions on hours for 307 KB
geothermal drilling_incl appendices.pdf
Bill 292_Testimony_HSEO.pdf 651 KB
2 of 2 10/18/2012 6:53 AM