Lawyers for Hu Honua say in federal court papers that the utility has engaged in illegal anticompetitive behavior.

Lawyers for Hu Honua are seeking $1 billion in damages from Hawaiian Electric for actions they say led to the tree-burning plant sitting idle.

In a lengthy filing in federal court in Honolulu, Hu Honua’s attorneys said Hawaiian Electric has engaged in anticompetitive behavior that has damaged not only the biomass company but Hawaii island customers who pay some of the highest energy costs in the country.

The electric company has acted with “shameless arrogance and disregard not just for competition, but for the people, economy, and environment of Hawaii Island,” according to the filing.  

Wide view of the Hu Honua biomass plant located at Pepeekeo, Hawaii island. (Cory Lum/Civil Beat/2022)

Hawaiian Electric spokesman Jim Kelly said the utility has no comment.

Hu Honua, also known as Honua Ola Bioenergy, has unsuccessfully attempted to operate its $520 million, eucalyptus-burning plant for many years, but it has faced a string of negative court rulings and a formal denial by the Hawaii Public Utilities Commission in a 2-1 vote.

On March 13, the Hawaii Supreme Court rejected Hu Honua’s appeal of the PUC’s May 2022 denial of a power purchase agreement with Hawaiian Electric.

Had the 30-year agreement taken effect, Hu Honua would have supplied 21.5 megawatts of power to Hawaiian Electric, enough to supply about 14,000 homes with energy. But Hu Honua would have emitted 8 million tons of carbon dioxide over the course of the plant’s life and it would have raised customers’ bills by about $10 a month, according to the PUC.

The justices agreed with the commission’s majority that allowing Hu Honua to operate would not serve the public interest because of the plant’s greenhouse gas emissions and price hikes to consumers.  

Hu Honua’s court action this week attempts to revive older litigation against Hawaiian Electric.

HECO HEI Hawaiian Electric power plant located along Ala Moana Boulevard.
Hawaiian Electric power plant located along Ala Moana Boulevard. (Cory Lum/Civil Beat/2022)

The company’s motion asks the court to allow Hu Honua to update its 2016 lawsuit against the utility with new antitrust allegations. Hu Honua sued Hawaiian Electric that year after the utility cancelled a power purchase agreement over missed deadlines. Hu Honua sought over $1 billion in damages for the contract cancellation.

In its new filing, Hu Honua argues that Hawaiian Electric terminated the power purchase agreement not because of missed milestones but because it was part of an “anticompetitive scheme to maintain and extends its monopoly” over the electricity market on the Big Island.

Hu Honua alleges that Hawaiian Electric acquired Hamakua Energy Partners in 2017, an independent energy producer in Honokaa, in a move to keep Hu Honua out of the market and to solidify its control over more than 90% of all firm power generation on the island. So-called firm energy is the kind that is constantly made, unlike wind or solar that are intermittent.

In addition to damages, Hu Honua wants the court to order Hawaiian Electric to transfer its ownership of Hamakua Energy to an independent owner to foster competition in the Big Island’s energy market.

Hu Honua’s attempt to reopen its federal lawsuit is not unexpected.

The biomass company and Hawaiian Electric had reached a confidential settlement in May 2017 in which Hu Honua agreed to set aside its federal lawsuit while Hawaiian Electric sought PUC approval for a new power purchase agreement.

When the Hawaii Supreme Court ruled against Hu Honua in March, the settlement became null and void. Many energy watchers expected Hu Honua to dust off its federal antitrust complaint and return to court.

“Today, Hu Honua’s plant stands idle because of HECO’s conduct, even though Hawaii Island has an acute need for independent generating capacity,” the company argues.

It also blames Hawaiian Electric for contributing to wildfire risks on the Big Island.

Besides eucalyptus, Hu Honua also planned to burn invasive trees, as well as green waste from the island. By using its monopoly power to keep Hu Honua out of the energy marketplace, Hawaiian Electric is increasing the Big Island wildfire risks, according to the court filing.

The Hawaii Department of Transportation had agreed to partner with Hu Honua to dispose of highway green waste and cut trees near power lines to ensure that the island could be more resilient to extreme weather events, it said.

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