Environmental groups are celebrating this week because the last coal-fired generating facility in Hawaii’i will be shut down by September 1. The AES facility at Barbers Point on Oahu serves about 300,000 customers and has been in operation for 30 years. Annually, it spews about 1.5 billion tons of carbon dioxide into the atmosphere, which is a tragedy for one of the most beautiful spots on Earth. Hawai’i, like all islands, is at extreme risk from rising sea levels, largely due to higher average global temperatures related to gas emissions such as carbon dioxide.
The End Of Coal On Oahu
Hawai’i began transitioning to renewable energy as the result of legislation passed in 2015. A subsequent law enacted in 2020 moved the timeline for the transition to renewables forward, which the closure of the Barbers Point coal-fired facility.
Hawaii’i has always had some of the highest electricity rates in the nation. Much of its electricity is made by burning oil — one third of it from Russia. It costs a lot of money to ship coal and oil to the islands, which is the primary reason utility rates are so high. Once access to Russian oil was cut off, utility companies were forced to seek other suppliers and pay significantly more for oil.
Renewables are cheaper in the long run because once they are built, the cost of fuel is zero. But Hawai’i does not yet have enough renewable energy to meet all its needs. One of the long term advantages of renewable energy, of course, is that it is produced locally, so its price is not impacted when tyrants like Pooty Poot have a hissy fit that drives up the cost of coal, oil, or unnatural gas.
The closure of the Barbers Point coal generating station will unfortunately inflict further pain on Hawaii’s long suffering utility customers. As more renewable energy comes online, rates will drop and future price hikes will be avoided. In the meantime, taking Barbers Point offline will add about $15 a month to the average residential electric bill.
Hawai’i Governor David Ige told Canary Media at a ceremony marking the end of service at the Barbers Point facility, “It’s about having a North Star and being clear about what the long term objectives are so that we can make generational decisions that will provide long term stability and support for our communities. ” In other words, government should act on facts, not opinions expressed on Fakebook, Twitter, or Faux News.
AES, which owns the Barbers Point facility, has been deeply involved in the transition to renewable energy in Hawai’i, starting with the solar power plant and battery storage facility that has been powering the northernmost island of Kauai since 2019.
Any blame for the fact that fewer solar projects have been completed in Hawaii’i than could have been built under ideal circumstances can be laid at the feet of Congress, which for many years has failed to establish clear renewable energy policies with a long enough timeline to allow developers to plan, permit and complete them in time to qualify for favorable tax treatment. The new Inflation Reduction Act cures that defect in federal policy and should encourage an explosion of new clean energy projects in Hawai’i and throughout America.
“This has to be the most tumultuous time in terms of the energy space,” Governor Ige noted. “I don’t think anyone anticipated Russia invading Ukraine and all of the turmoil and price increases that have been driven by that activity. We do know, over the next 12 to 24 months as those projects come online here on Oahu, that our residents will begin to see more stable energy prices and ultimately a reduction in their energy bills.”
The legislature’s coal shutdown mandate should have been contingent on having enough renewable electricity to fill the gap, state Senator Glenn Wakai told Canary Media after the ceremony. But there wasn’t the political will in the legislature to extend the life of the coal plant and doing so would have resulted in pushback from environmentalists committed to action on climate change.
“I believe that today’s a great day, two years too early,” Wakai said. “If you’re a believer that climate change is going to come to an end because of the shutdown of this coal plant, it’s a great day for you. If you pay an electricity bill, this is a disastrous day for you.”
Make Good Policies Is Hard
Canary Media points out that government policies that make no provision for unexpected changes in the status quo can lead to bad results. If AES had been allowed to extend its coal contract by another year or two, it says, Oahu may have ridden out the current oil price shock. Two extra years could have bought time to complete more large scale solar and storage projects, each of which will reduce demand for oil generation.
On the other hand, the absence of a firm deadline can encourage utility companies to find reasons to keep old generating stations online. “There was a time for coal, but that time is coming to an end,” said State Representative Nicole Lowen, who chairs the Committee on Energy and Environmental Protection. “It’s not going to do us any good to keep delaying this transition.”
For better or worse, the deadline forced the transition to begin in earnest, putting the onus on the various stakeholders in Hawaii’s energy community to figure out how to make it happen. “What we have to do now from a government standpoint is hasten the permitting process and really push [utility Hawaiian Electric] to have interconnections, because they’re part of the solution as well,” Wakai said. “Because of the sense of urgency now, I think you’re finally going to see government permitting move at the speed of light.”
Barbers Point has one major asset that could make it an ideal location for a new renewable energy hub — a robust connection to the utility grid. After several months of remediation work, demolition of the old coal-burning facility is scheduled to begin in January, leaving the site ready for clean power development.
Taking Care Of People
Canary Media praises AES for looking out for the 80 or more employees whose jobs will be eliminated when the Barbers Point coal generating station closes. Many have been retrained for jobs in renewable energy or offered other positions with the company, either in Hawaii’i or on the mainland.
“We care about our employees, and we want each and every one of them to have a place to land when this is all done,” said Sandra Larsen, the market business leader of AES in Hawaii. Plant manager Steven Barnoski said “The plant’s closing, yes, but we’re moving our company and our employees over to clean energy or other roles within AES. “We’re slowly closing down the coal plants and building a lot more renewable energy.” Barnoski himself is moving to a new job with AES in Indiana.
The Takeaway On Coal
Policy making can be messy. It sometimes goes too fast and other times too slow. Certainly the hard date for closure of the Barbers Point coal-fired generating facility did not come at the ideal time for the state or its citizens. Ultimately, however, it is the right policy for the state
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