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Rocky Mountain Institute Helps Hawaii Update Its Energy Strategy
Originally posted on sciy.org by Ron Anastasia on Tue 20 Mar 2007 06:09 PM PDT
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RMI Helps Hawaii Update Its Energy Strategy
by Lena Hansen and Kitty Wang, PE
Since the late 1960s, Hawaii has relied on oil to meet roughly 90 percent of its energy demand.
 It
is safe to say that those who are fortunate enough to live or vacation
in Hawaii do so in large part because of the environment, which many
call paradise. Hawaii is one of the most isolated places in the world,
its air is almost constantly refreshed by its prevailing trade winds,
its ocean is clean, and its tropical location ensures a pleasantly warm
climate year-round. Although recent waves of settlement have harmed
some native flora and fauna, Hawaii remains home to hundreds of species
found nowhere else on earth.
Hawaii's remoteness creates many challenges as well. Since the
late 1960s, the state has relied on oil to meet roughly 90 percent of
its energy demand. The cost of this oil dependence translates to a
higher overall cost of living, the nation's highest electricity prices,
and very high gasoline prices. In September 2006, Hawaii's residential
electricity revenues per kilowatt-hour ranged from 19.75 cents to 34
cents, with a statewide average of 24.24 cents compared to a national
average of 10.92 cents. Overall, electricity costs were 21.51 cents per
kilowatthour in Hawaii compared to the national average of 9.26 cents.
Hawaii's gasoline prices consistently rank among the highest in the
country.
The economic impacts of this heavy reliance on oil are
magnified when oil prices rise sharply, as has been the case in recent
years. Sharp increases in oil prices affect every aspect of Hawaii's
economy, including tourism, agriculture, transportation, and
electricity generation. Such a high dependence on oil also creates a
supply disruption risk, and has the potential to damage Hawaii's
fragile environment. Marine and shore life is vulnerable to accidental
oil spills, and oil-fired power produces air pollution (the effects of
which are reduced by the islands' trade winds) and significant
greenhouse gas emissions.
Recognizing these vulnerabilities, the State crafted the first
Hawaii Energy Strategy (HES) in 1995. The State's goal was to better
understand the risks it faces due to its unique energy situation, and
to propose recommendations for achieving its objectives of reduced oil
dependence, lowered energy costs, increased environmental
sustainability, and a diversified economic base. The strategy was
updated in 2000 by Hawaii's Department of Business, Economic
Development & Tourism (DBEDT). This year, DBEDT retained Rocky
Mountain Institute (RMI) to help DBEDT craft HES 2007 and outline a
strategy that will, among other things:- Promote the more efficient use of Hawaii's energy resources;
- Manage risk by diversifying Hawaii's fuel supply and expand the use of indigenous resources;
- Ensure a secure, reliable, and affordable energy supply; and
- Protect the environment through cost-effective reductions of greenhouse gas emissions.
Achieving these goals could radically transform Hawaii's energy future.
However, transformation requires action, not theory. Thus, RMI's
recommendations focus on specific steps to be taken by Hawaii's
government and regulatory organizations to ensure the success of HES
2007.
In fact, Hawaii has already made significant strides toward
energy independence and security. Led by the Governor's Energy for
Tomorrow program, the State government, the private sector, and
nonprofit organizations, coordinated action is being taken on many
fronts to reduce the State's dependence on oil.
In 2001, Hawaii passed a renewable portfolio standard (RPS)
that set a goal for each electric utility to meet 20 percent of its net
electricity demand with renewable resources by 2020. The RPS was
strengthened by making it a mandate in 2004, and the Legislature added
penalty provisions in 2006. Also in 2006, the State passed an
Alternative Fuels Standard (AFS), which established that 20 percent of
highway fuel demand must be met with renewable fuels by 2020.
Currently, Hawaii is on track to meet its 2010 AFS goal of 10 percent
renewable fuels.
The State government is "leading by example" in energy
efficiency measures in government buildings and vehicle fleets, and in
the installation of photovoltaic panels on schools.
Hawaii's electric utilities are getting involved as well. New
renewable energy projects are underway on three islands. On Maui, a
20-megawatt windfarm became operational in 2006 and a major wind
developer is pursuing another 30-megawatt windfarm. On the Island of
Hawaii, a new 10-megawatt windfarm was added in 2005 while another
windfarm has retired about 7 megawatts in older units and is repowering
with 20 megawatts of capacity. On Oahu, HECO has announced its
intention to build a new nominal 100-megawatt combustion turbine
peaking unit to be fueled by biofuels. Hawaii's agricultural history
and climate make it an ideal location for the production of biofuels,
which can not only reduce Hawaii's dependence on oil but also bolster
the state's agricultural sector and economy. Recognizing this
potential, the state has crafted some of the most aggressive biofuels
policies in the country, and with RMI's help, continues to explore
effective ways to expand the industry.
Hawaii is clearly demonstrating the potential for a state to
transform its energy future, thereby increasing the security of its
energy supply, lowering its energy costs, improving its environmental
sustainability, and bolstering its economy.
Kitty Wang is a Principal and Lena Hansen is a Consultant with RMI's
Energy & Resources Team.
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