Hawaiian Electric reaches power purchase agreement with Puna Geothermal Venture

Published on January 07, 2020 by Dave Kovaleski


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Hawaiian Electric reached an agreement with Puna Geothermal Venture (PGV) on a power purchase agreement that will expand its renewable portfolio to 70 percent.

The agreement on an amended contract was filed with the Hawaii Public Utilities Commission on Dec. 31, 2019, and is currently under review.

The contract calls for an upgrade of the 38-megawatt geothermal facility, which will produce an additional 8 megawatts of renewable energy. Once the upgrade is completed, the average residential bill will drop about $7.50 a month starting in 2022. By 2023 the average bill will decrease $13 a month. The price will be fixed, eliminating the volatility that comes with oil prices. It will also reduce greenhouse gases.

“We thank our regulators for the opportunity to revisit the agreement and find solutions that will reduce customer bills,” Sharon Suzuki, president of Hawaiian Electric’s Maui County and Hawaii Island utilities, said. “The pricing of renewables has dropped significantly in recent years. The owners of PGV recognize that, and we appreciate their willingness to sit down and work with us on an amended contract that benefits customers and accelerates our transition to 100 percent renewable energy.”

The PGV facility had been shut down since the eruption of the Kilauea Volcano in May 2018. Production from oil-fired generators has been expanded to make up for the loss of the PGV facility.

“We have enjoyed a long and successful relationship with Hawaiian Electric and Hawaii Electric Light and are grateful for its support of geothermal power,” Isaac Angel, chief executive of Ormat Technologies, Inc., the owner of PGV, said. “We are proud to partner with Hawaiian Electric and enable Hawaii’s commitment to clean energy and reducing greenhouse gas emissions. As Hawaii continues to pursue the goal of achieving 100 percent of its electricity generation from renewable sources, PGV is an increasingly critical source of renewable energy and capacity, unaffected by volatile fossil fuel pricing in this region.”

The plant’s additional production will displace about 160 million gallons of oil over the life of the contract, significantly reducing greenhouse gas emissions