Editorial

HELCO’s Keahole Gambit: Irrational and Costly

For the folks at HELCO, “planning” has come to mean the single-minded pursuit of the permits and approvals needed to install two new combustion turbines at Keahole.

In the name of this “planning,” HELCO has dragged its feet in negotiating terms with independent power producers who want to sell HELCO energy at a cost no greater than that which HELCO would otherwise pay to produce it.

In the name of this “planning,” HELCO has dragged the Board of Land and Natural Resources, non-profit groups, and private citizens through a costly, lengthy court process — all so it can build an oil-fired power plant on Conservation District land (where, by the way, such plants are now prohibited).

The lengths to which HELCO has gone to defend its “plans” for Keahole may, in fact, backfire on the utility, should the Public Utilities Commission not allow it to place all of its costs into its rate base. As early as September 1995, HELCO anticipated this, when its parent corporation, Hawai`i Electric Industries, Inc., disclosed in a report to the Securities and Exchange Commission that it could be forced to write off all or part of the $41 million HELCO had spent up to that time on the pursuit of the Keahole expansion.

One can only speculate on the reasons HELCO appears to have let sweet reason fly out the window and is now hell-bent on Keahole at any, at all, costs. HELCO didn’t want to go to Keahole when it embarked on a long-term planning process in the late 1980s. However, when the preferred sites were unavailable — one of them having now been leased to a party HELCO obviously regards as a competitor — the die was cast. Rancor, bad faith, and an overall lack of trust seem now to guide HELCO’s decisions, and to hell with the ratepayer, the shareholder, the environment.

This is no way to run a utility. Unfortunately, given the difficulties of public involvement in the arcane process by which the PUC makes its decisions, HELCO is able to carry out its “planning” with little public scrutiny. The Consumer Advocate, as a stand-in for the public’s interest, and a handful of others, including the energy analyst at the state Department of Business, Economic Development and Tourism, are to be commended for their unsung efforts to keep HELCO honest. Not to be overlooked are the incredible sacrifices of the private citizens who have taken HELCO to court in an effort to protect Conservation District values that even the state’s own attorney general appears willing to cede to HELCO. To Peggy Ratliff, Mahi Cooper, and Mike Matsukawa, the attorney who has assisted them, mahalo.

The Other Issues

The issues raised in the debate over the siting of new power plants are complex. We freely acknowledge that in this edition of Environment Hawai`i, we have only begun to scratch the surface. The matter of emissions from fossil-fuel-fired plants on an island where air quality is severely impacted by natural forces should not be lightly dismissed. There is the further issue of HELCO’s rates, which have risen briskly over the last decade, with another 11.5 percent rate hike being proposed.

Finally, there is the much larger issue of whether a society with an apparently unstoppable demand for energy is well served by the proliferation of power plants to provide energy on demand. For a few years, the state engaged the utilities in what seemed to be a serious program to promote energy conservation through demand-side management measures. As this issue and our April issue show, there seems to be little follow-through. For this, blame the utilities a little; blame the rest of us a lot.

The state Attorney General’s office was charged with defending the Land Board’s efforts in 1996 to block the expansion of HELCO’s Keahole plant. The nicest thing that can be said of the defense mounted by Randall Young, the deputy AG assigned the case, is that it was short. To call it meek is too generous. The concluding remarks in his written brief on the matter, for example, threw his clients on the court’s mercy: The BLNR defendants, he wrote, “are … only able to ask this Court to act judiciously in this area, as the case authority and the BLNR itself are demonstrably fragmented.”

Small wonder the Land Board ends up in such trouble when it is represented by the likes of Young. HELCO, however, has spared no expense in hiring legal counsel. We would take note especially of the presence on HELCO’s team of Benjamin Kudo and Wesley Fujimoto, of Dwyer Imanaka Schraff Kudo Meyer and Fujimoto.

For the last two years, the Legislature has had a bill before it that would have clarified the legal muddle concerning how many votes the Land Board must have to block a Conservation District permit. The bill has been held without hearing in the Senate Committee on Water, Land, and Hawaiian Affairs, whose co-chair is Randy Iwase. Iwase is an attorney who, while not in active practice, is “of counsel” to Dwyer Imanaka Schraff et al.

Coincidence? We think not.

Volume 8, Number 11 May 1998