Expensive prices passed on to customers and long-term environmental impacts are among the major concerns Hawaii’s Consumer Advocate and others continue to have about Hu Honua, a proposed tree-burning power plant on the Big Island.

After lengthy evidentiary hearings in early March, parties to the Hu Honua case before the state Public Utilities Commission filed hundreds of pages of briefs in recent days. Much of the paperwork continues to criticize the proposed bioenergy facility on the east side of Hawaii island. But Hu Honua stands by its project, saying it’s environmentally friendly, a job creator and a source of renewable power for island residents.

Hawaii’s Consumer Advocate, Life of the Land and Tawhiri Power all say important questions and concerns remain about Hawaii Electric Light Co.’s proposed power purchase agreement with Hu Honua.

“Hu Honua is not a good project and it should be canned,”said Henry Curtis, executive director of Life of the Land, a nonprofit public interest group. “The Big Island has enough energy. It’s not needed and it will raise rates.”

Those are just a few of Curtis’ many concerns. A litany of others are spelled out in Life of the Land’s latest brief.

Both Hu Honua and Hawaii Electric Light are requesting that the commission approve the project, allowing the plant to start burning eucalyptus trees, turning them into power and feeding HELCO’s grid.

“We have addressed everything that was asked of us” from the commission and the court, said Hu Honua President Warren Lee. If there are outstanding concerns they can be resolved and conditions can be written into the power purchase agreement, he told Civil Beat.

The plant used to burn sugar cane leaves and stalks during Hawaii’s sugar production days. It converted to coal in 1994 and supplied power to the island until 2004, according to Hu Honua’s website.

The 30-year power purchase agreement under review would involve Hu Honua getting preferential rates, meaning the company would sell its energy for higher prices than market rates to HELCO. The electric utility would then pass those costs on to customers.

“If the agreement is approved, it’s going to result in a price increase for consumers on Hawaii island,” said Dean Nishina, executive director of the Division of Consumer Advocacy, in an interview Friday.

“That’s not to say that when the commission is looking at renewable energy projects they can’t consider higher short-term costs, as long as there’s some reasonable expectation that the overall benefits of the project will actually benefit the consumers,” he said.

In Hu Honua’s case, the price increases to consumers would be locked in for 30 years.

“We’re telling the commission, ‘Hey, if you can’t verify that these benefits are going to be realizable … you should have questions and concerns about this project,'” Nishina said.

Why would higher-cost energy over the long term be a good thing and why would the commission authorize that? To critics, it’s a head-scratcher.

But proponents point to Hawaii’s stated goal of becoming 100% powered by renewable energy by 2045. In seeking to stimulate renewable energy production and the agriculture industry, the Legislature gave the commission the discretion to approve preferential rates if renewable energy is produced in tandem with agricultural activities.

With Hu Honua, the agricultural activity would be tree harvest and reforestation, with eucalyptus as the crop.

But critics say even if the commission has the authority to approve the project, is it reasonable to give a thumbs up if it means higher electric bills for consumers and possible environmental impacts? That’s the key question the commission is evaluating. At this point, the company has not met its burden of proof and therefore the commission cannot find the power purchase agreement “is in the public interest based on the current record,” according to the Consumer Advocate, the office headed by Nishina.

Too many issues remain over greenhouse gas emissions, preferential rates and long-term environmental impacts that might result from the proposed facility, he said.

There’s also the fact that HELCO “has no specific need for the Hu Honua facility” because there’s enough energy already produced on the Big Island, the brief states. Current energy sources include wind, solar, geothermal and fossil fuels, and Hu Honua “does not appear to be a good candidate to replace other generating units currently in Hawaii Electric Light’s fleet,” according to the Consumer Advocate.

Under the proposed power purchase agreement, HELCO would buy about 21.5 megawatts from Hu Honua. At a minimum, it would have to buy 10 megawatts with the plant operating 24/7, 365 days a year for the entire 30-year term of the contract. The purchase terms would be locked in even if cleaner and less expensive energy is available.

If HELCO must take at least 10 megawatts, that means Hu Honua has the potential to cut into the sale of energy to HELCO from Tawhiri Power’s wind farm at South Point as well as other renewable energy sources, wrote Sandra-Ann Wong, an attorney for Tawhiri.

HELCO and Hu Honua contend the bioenergy plant is uniquely positioned to address Hawaii’s renewable energy goals.

“Clearly this is not correct. The only thing unique about Hu Honua is its high cost to HELCO’s ratepayers,” Wong wrote.

Construction of the facility, located 10 miles north of Hilo on the scenic Hamakua Coast, is nearly complete. Lee said it cost over $500 million to build.

But the Hu Honua project has been stalled for years, bogged down in litigation and regulatory proceedings. It’s been appealed three times to the Hawaii Supreme Court. The court dismissed the last appeal and sent the matter back to the commission.

Currently, the commission is charged with determining whether the long-term environmental and public health costs related to Hu Honua’s energy production are in the public interest, as well as whether the total costs of the energy are reasonable. Those costs could include the energy itself, operations and maintenance of the plant, and other factors that might impact customer bills.

The Consumer Advocate is skeptical about the adequacy of the greenhouse gas analysis performed by Hu Honua’s consultant, as well as where the plant would source 30 years’ worth of trees.

The company stands by its greenhouse gas study. As far as the trees, Lee says Hu Honua has secured enough eucalyptus from the Pahala, Parker and Hamakua plantations on the Big Island to last up to nine years. Lee told the commission in early March that it doesn’t have signed contracts for 30 years of trees but it’s working on it. If available Big Island trees ran out, the company would import them from other Hawaiian islands, the mainland U.S. or overseas, Lee said.

The lack of signed contracts with tree plantations makes it hard for the commission to assess the real amount of greenhouse gases the plant would emit, according to the Consumer Advocate. It also calls into question whether Hu Honua even qualifies for preferential rates given the uncertainty over whether there’s enough tree stock on the Big Island to last for three decades.

The Consumer Advocate contends Hu Honua’s request for preferential rates should be denied.

Lee says no energy producer is required to have signed contracts for 30 years worth of fuel. Why should Hu Honua be obligated to show it has three decades worth of trees?

“There’s no such thing as a 30-year fuel contract,” he said.

Hu Honua filed a 120-page brief, defending its argument for preferential rates and saying its facility in Pepeeko would significantly reduce greenhouse gas emissions because the company would replant more trees than it cuts.

It pledges to be carbon negative, meaning it would offset more carbon through sequestration than what is emitted into the environment. In the event that Hu Honua fails to be carbon neutral in any given year starting in 2035 or cumulatively over the 30-year life of the project, the company is committed to purchasing carbon offsets to meet its goal of being carbon neutral. It pledges to put $100,000 into escrow or a reserve fund to ensure that the company’s carbon commitments are met.

As far as tree stock, the company says if it gets a “final, non-appealable” approval from the commission, it would provide documentation within 60 months that it has secured additional acreage on Hawaii island to provide enough trees for 30 years. If it had to buy trees from out of state, it would agree not to receive preferential rates during the period of time it was using them to generate power.

The company currently has 14,000 acres of trees under contract, Lee said. Most of the land is owned by Kamehameha Schools and Parker Ranch. He said he’s negotiating with Kamehameha Schools to try to get an additional 5,500 acres. Hu Honua would like to have up to 25,000 acres in total. Lee is also trying to work out an arrangement with the state to access invasive tree species like strawberry guava that could be burned at the plant.

“Hu Honua is an opportunity to revitalize East Hawaii Island’s agricultural and forestry sector, bringing hundreds of jobs and infusing millions of dollars into the local economy over the next 30 years,” the company brief says.

“The overwhelming and relevant evidence in the record establishes that the burden of proof for approval has been met,” according to the company. Translation: Hu Honua says it has done everything it’s been asked to do so the commission should give it the green light.

Curtis, who heads Life of the Land, says the long and litigious history of the bioenergy plant “raises serious questions about whether this project is in the public interest or the interest of HELCO’s ratepayers.”

Life of the Land questions why HELCO is still supporting the power purchase agreement even when its says Hawaii island has enough energy sources and doesn’t need Hu Honua. The organization notes that when Hu Honua sued the utility in federal court over terminating its original power purchase agreement, it claimed that HELCO was guilty of anti-trust violations, breach of contract, breach of fiduciary responsibility and other laws.

Hu Honua sought hundreds of million of dollars in damages from HELCO plus legal fees. The parties reached a confidential conditional settlement and the federal lawsuit was suspended as HELCO sought commission approval for an amended power purchase agreement.

Life of the Land questions whether HELCO is continuing to support the Hu Honua project in order to limit or avoid paying damages “that could total well over a billion dollars.”

Hu Honua said in 2018 court papers it would seek damages from HELCO “in no event less than $555 million, which must be trebled” under Hawaiian law plus reasonable attorney’s fees, according to Life of the Land’s brief. In other words, if the commission doesn’t approve the power purchase agreement, Hu Honua could go after HELCO in court for $555 million — times three.

In her brief, Wong raised similar questions about HELCO’s potential motives. She pointed out that in the event the commission gives thumbs down to the new power purchase agreement, the settlement agreement between the utility and Hu Honua goes out the door and their federal court fight could resume.

“Given this, is HELCO advocating for the public interest and the interest of its ratepayers or is it protecting itself from additional litigation by Hu Honua at the expense of the public and its ratepayers?

“This is a valid question,” Wong wrote.

A decision by the commission is expected before the end of June.