Crops grown on Hawaii’s Big Island will be converted into liquid fuel as part of a deal announced Thursday between Hawaiian Electric Co. and renewable energy company Aina Koa Pono.
The agreement is the first in Hawaii to produce enough biofuel for use in power plants, where it will be converted to electricity.
By 2015, the 13,000-acre energy farm is projected to produce enough fuel to power about 16 percent of the Big Island, although the utility expects to also ship the fuel to other islands to meet their electric needs.
The deal is part of the state’s initiative to get 40 percent of its energy from renewables by 2030.
“It helps Hawaii with its energy independence goals,” said Robbie Alm, executive vice president for Hawaiian Electric, a subsidiary of Hawaiian Electric Industries Inc. “We’ll be able to say that our energy dollars are circulating here rather than going to foreign ports.”
Power users on Oahu, Maui and the Big Island would pay about one-third of a cent per kilowatt hour extra to fund the accord, or about $1.86 per month for a typical residential consumer. The cost hike would have to be approved by state regulators.
Aina Koa Pono will grow crops including sweet sorghum and eucalyptus on the land in the Big Island’s Ka’u district, located in the southeast part of the island.
Once grown, the crops will be put through a process turning them into liquid fuel that can be used in Hawaiian Electric’s power plants, with their electricity shipped across the power grid.
“The time has come to take a bold step toward establishing a self-sustaining energy future for our state,” said Melvin Chiogioji, a co-founder of Aina Koa Pono. “This partnership is critical in helping Hawaii reduce its reliance on imported fossil fuels.”
Environmentalists see progress in the move toward biofuels, but their power would be better used in transportation vehicles than on the power grid, said Robert Harris, director of the Hawaii chapter of the Sierra Club. That’s because biofuels are portable liquids, unlike wind and solar power.
“We’ll always need liquid petroleum of some kind for planes and for boats. There are plainly options that are cheaper and available for electrical production,” Harris said.
Aina Koa Pono’s biofuel may be used for transportation as well as for electricity, Chiogioji said.
The project’s construction is expected to start late this year or early next year, with biofuel production beginning sometime in 2013.
By 2015, Aina Koa Pono will provide 16 million gallons per year under its 20-year contract with Hawaiian Electric.
It will create 300 jobs during construction, and between 100 and 150 permanent jobs afterward, Chiogioji said.
This is the first of several expected biofuel agreements with Hawaiian Electric, Alm said. The utility received 11 bids for biofuel projects on each of the state’s major islands.