HECO Waiver Projects

This just in from Pacific Business News:

Jun 19, 2013, 11:00am HST

Hawaiian Electric selects five low-cost renewable energy projects for Oahu

Duane Shimogawa
Reporter-Pacific Business News

Hawaiian Electric Co. has selected five Hawaii wind and solar energy projects in Hawaii that could be up and running quickly to provide electricity on Oahu at a low per-kilowatt-hour cost.

HECO declined to disclose the names of the developers, which deliver wind and solar technologies.

To accelerate the development of these projects, HECO, a subsidiary of Hawaiian Electric Industries (NYSE: HE), has asked the Hawaii Public Utilities Commission for permission to negotiate with these developers that could quickly provide low-cost electricity for Oahu.

If the PUC approves this request, HECO said it will negotiate power-purchase agreements directly with the developers of these five projects, which include a mix of solar and wind energy across Oahu with a combined capacity of 64 megawatts.

HECO anticipates negotiating long-term, 20-year contracts with each project.

Combined, the developers have committed to sell electricity to HECO at an average price of 15.9 cents per kilowatt-hour, which is about one-third less than prices paid to existing solar and wind energy projects on Oahu and the current cost of generating electricity from oil, HECO said.

“These projects represent an important first step as we are starting to see lower market prices for renewable energy,” HECO Vice President for Energy Resources and Operations Scott Seu said in a statement. “The strong response we received demonstrates the high level of competition in our market. That’s good news for our customers.”

Based on preliminary estimates, HECO expects the combined effect of all five of these projects could reduce generation costs by approximately $7.4 million a year, compared to today’s cost of generation. The company’s goal is to have as many of these projects as possible in service by the end of 2015.

Additionally, 20 projects that originally submitted proposals but were not selected will be given the opportunity to update and resubmit their pricing proposals, HECO said.

If those projects meet lower pricing and other criteria such as site control, they could be considered in a supplemental request to negotiate power purchase agreements.

In February, HECO issued a call for low-cost renewable energy projects on Oahu that could qualify for a waiver from competitive bidding and narrowed the responses to five projects based on prices and other criteria such as site control and development experience.

 

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