Low power demand may delay new Kapolei plant
| • | Big Isle power addition stalls |
By Frank Cho
Advertiser Staff Writer
Slower than expected growth in power demand in recent years has Hawaiian Electric Co. re-evaluating plans to build a $200 million power plant at Campbell Industrial Park in Kapolei.
Hawaiian Electric, the state's largest power company, declined to discuss details of the review but acknowledged that demand for electricity on O'ahu is not growing as fast as the company had expected.
The utility company had been scheduled to file a report with state regulators by the end of October that would determine if the power-plant project was still economically viable, but company officials said they are not ready and will likely ask for a two- or three-month extension.
"The current plans calls for a new power plant at Campbell Industrial Park in 2009, among many other things we are doing," said Chuck Freedman, a spokesman for Hawaiian Electric. "We now are reassessing all those items, and that is what we are going to submit to the (Public Utilities Commission). Until we do that, we can't really talk about it."
The company proposed building the Campbell power plant to the commission in 1997 as part of its "Integrated Resource Plan," a long-range assessment of the state's electricity needs.
Initially slated to be built in 2003, the oil-fired, 318-megawatt plant was to be developed in three phases at the industrial site.
But that date was pushed back to 2009 after the company embarked on a program to reduce electricity demand by customers through the use of more energy-efficient products.
Chris Nakagawa, chief counsel for the Public Utilities Commission, said the state does not know what Hawaiian Electric's new plan will look like, or whether it will include the Campbell Industrial Park plant.
Hawaiian Electric also had considered building a new power plant or adding more generating capacity at its Kahe site, but that project was abandoned because of strict federal air-quality standards.
Years of heavy industrial use and emissions by other power plants, refineries and chemical facilities has raised concerns among some nearby residents about the area's air quality.
Still, experts say that Campbell Industrial Park's zoning and location make it the only viable site on O'ahu in which to build a new power plant.
"Campbell Industrial Park has always been the front-runner because it is easy," said Carl Freedman, a former energy consultant to the state. "It's zoned for heavy industrial use and there are already three other power plants in the area.
AES Barbers Point Inc. operates a coal-fired 180-megawatt plant at the site, Kalaelo Partners operates a 180-megawatt low-sulphur oil-fired plant, and H-Power converts waste into power with 46-megawatt plant.
Hawaiian Electric, which is also the parent company of Hawaii Electric Light Co. Inc. on the Big Island and Maui Electric Co., had been moving forward with its plans to build a power plant at Campbell Industrial Park, submitting an application to the state in 1997 for a clean-air permit. The company, however, withdrew that request two years later.
Freedman of Hawaiian Electric said the company shelved the idea when it became clear that the plant would not likely be needed before 2008.
AES Hawaii developed the last power plant on O'ahu in 1993, a 180-megawatt, coal-fired plant that sells the electricity it generates to Hawaiian Electric.
"A competitor can always come in and make a proposal to HECO, and by federal law if they can provide power equal to or at a lower cost, they can build it," HECO spokesman Freedman said.
Over the past 10 years, power demand on O'ahu has grown about 1.18 percent annually compared to nearly 3 percent on the Big Island and almost 4 percent on Maui, according to Hawaiian Electric figures.
"Sales have not, at least recently, been what was expected," said Dean Nishina, a public utilities specialist with the state Office of Consumer Advocacy.
The company's demand-side management effort, a move to decrease electricity demand by consumers, has pushed back the need for a new power plant by two to three years, Hawaiian Electric said.
But Hawaiian Electric's Freedman said all signs point to increased demand over the next few years. According to Hawaiian Electric, the average annual growth in power sales on O'ahu is projected to rise to about 2 percent over the next five years, compared to 2.14 percent on the Big Island and nearly 3 percent on Maui.
Reach Frank Cho at 525-8088, or at fcho@honoluluadvertiser.com.
