It’s arguably the biggest energy-related story in Hawaii of this young century. Startup company Kuokoa Inc. has announced its intention to buy out Hawaii Electric Industries (HEI) and take it private, create a statewide electricity rate of 20 cents per kilowatthour and phase out all fossil fuel power generation within a decade.
Call it what you will – one skeptic calls it “a comedy” – but Kuokoa’s plan on its surface is enough to make hearts beat faster for those who thought getting off oil for electrical generation in Hawaii might take four decades, not one.
Kuokoa’s website is in a holding pattern with nothing beyond the home page; what little information is available on the plan was found online first at Honolulu-based Civil Beat and later at the Honolulu Star-Advertiser and Pacific Business News. Civil Beat continues to be out in front and posted an update on HEI's initial reaction to the proposed takeover.
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4:45 PM UPDATE: Hawaiian Electric Company and Castle & Cooke have signed a Power Purchase Agreement for wind energy generated on the island of Lanai. HECO's press release has details.
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According to those sources, Kuokoa’s leadership includes Big Island farmer Richard Ha, chairman; venture capitalist Roald Marth, CEO, and Ted Peck, president. Today is Peck’s last day as State Energy Administrator.
Will HEI Turn 30?
Whether HEI will reach it’s 30th anniversary in June remains to be seen. The holding company was formed in the summer of 1981, a creation of Hawaiian Electric Company’s president and CEO C. Dudley Pratt, Jr. We wrote about Pratt's HEI career in May after his death.
Pratt anticipated Hawaii’s green energy revolution even before he was elevated to HECO’s corner office earlier that year, and he set about to implement a diversification plan for the state’s largest utility that he first wrote as an MBA student at the University of Hawaii.
HEI became the parent company of HECO, which had the Maui and Big Island utilities as subsidiaries and still does. Other HEI subsidiaries were created, starting with Hawaiian Electric Renewable Systems, the vehicle for building a wind farm in the hills above Kahuku.
Pratt envisioned HEI as the provider of essential services to Hawaii’s population, and he expanded HEI by acquiring American Savings Bank, Hawaiian Tug & Barge and Young Brothers (inter-island cargo shipping). HTB and YB were acquired by SaltChuk Resources, Inc. of Seattle, WA in 1999, but ASB is still owned by HEI.
The 10-Year Plan
Kuokoa reportedly intends to sell the savings bank, but the most eye-catching part of its plan is the company’s intention to “write off HEI’S fossil-fuel burning assets and invest billions to convert the power-generating system to entirely renewable energy within 10 years,” according to the Star-Advertiser report.
If achieved, this plan would leave the Hawaii Clean Energy Initiative in its dust – a plan Peck was central to helping create among signatories HEI, the State of Hawaii and the U.S. Department of Energy.
HCEI’s current goal is to curb fossil fuel dependence for power generation to 30 percent by 2030, with renewable energy supplying 40 percent and conservation accounting for a 30-percent reduction in demand. Hitting the Target Zero Goal within 10 years seems remarkably ambitious – enough so to fire the imaginations of those who recognize oil’s stranglehold on the state and its people.
Premium gas costs $3.799/gallon at many Oahu stations – up 5 cents per gallon since yesterday – and regular gas costs up to and beyond $4/gallon on some of the neighbor islands. Predictions for the price of oil may be a dime a dozen and unreliable, but even so, predictions that oil will hit $150/barrel by this summer have a sobering effect.
We’re eagerly looking forward to more details about Kuokoa’s plan and will relay them as they become available.http://www.heco.com/vcmcontent/StaticFiles/pdf/20110107_C&C-HECO_LanaiAgreement.pdf
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