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Co-op files to ensure plug-in with utility decisions
The group wants the Big Isle’s needs to be considered as the HEI-NextEra merger is being weighed
POSTED: 01:30 a.m. HST, Feb 18, 2015
STAR-ADVERTISER / COURTESY MARCO MANGELSDORF
The Hawaii Island Energy Cooperative is seeking a seat at the table as the Public Utilities Commission considers the proposed merger of Hawaiian Electric Industries and NextEra Energy.
The new nonprofit cooperative association, registered with the state Feb. 9, was formed by business and community leaders to explore the possibility of creating an energy co-op on Hawaii island.
The Hilo-based co-op filed a motion Feb. 11 to intervene in the Public Utilities Commission docket on the proposed $4.3 billion merger between NextEra and HEI. But it is not taking a position for or against the deal, according to Marco Mangelsdorf, spokesman and a director of the co-op.
Instead, it hopes to ensure that commissioners consider the island’s energy needs and the potential benefits of a cooperative model of utility ownership during their deliberations.
“We seek to participate in the discussion of the unique perspective of the residents of our island, and if appropriate, explore an option that would make for a fundamental change in the landscape of energy production and consumption on Hawaii island,” Mangelsdorf said.
The co-op is led by its president, Richard Ha, president of Hamakua Springs Country Farms; vice presidents Gerald DeMello, a retired University of Hawaii administrator, and Wallace Ishibashi, a formerdivision director for the International Longshore and Warehouse Union; and Mangelsdorf, president of ProVision Solar Inc.
They and other Hawaii island residents formed a co-op steering committee in December and have been studying the successful example of the Kauai Island Utility Cooperative, which was launched by business and community leaders 12 years ago.
Florida-based NextEra announced its agreement Dec. 3 to buy Hawaiian Electric’s utilities on Oahu, Maui and Hawaii island in a deal the parties hope to close by the end of the year. It requires PUC approval.
At this point the Hawaii Island Energy Co-op is not trying to buy Hawaiian Electric Light Co., the Hawaii island utility, since it is not up for sale, Mangelsdorf said.
“It’s clear, according to the conditions and terms of the merger, neither HEI or NextEra can entertain any other offers for all or part of the companies, which is something we respect,” Mangelsdorf said. “HIEC is positioning itself as a possible option worthy of consideration to take Hawaii island in a different energy direction, depending on the course of the proceedings.”
The co-op’s mission, according to its filing with the Department of Commerce and Consumer Affairs, is “to provide to its members, on a cooperative basis, reliable, cost-effective electric energy and other energy solutions in an environmentally responsible and community-supported manner.”
In making its case to intervene, HIEC said it should have a right to participate given its mission and intended business plan as an energy cooperative association for the island of Hawaii.
“A sound record should include evaluation of the pending transaction in relation to potential future alternatives that may be in the public interest, including interests unique to the island of Hawaii,” the filing said.
The group cited potential benefits of a co-op structure including local, democratic control of critical infrastructure; community-chosen priorities; and potentially lower electricity costs through tax-exempt status, access to lower cost financing, and no shareholder profits.
It also sees a chance for greater energy independence and sustainability with development of island-produced fuels for both electrical generation and transportation.
“Being able to have more direct control over Hawaii island’s present and future energy profile would provide us with an extraordinary opportunity to showcase what can be done on our island on many different and innovative levels,” Mangelsdorf said.
http://hawaiitribune-herald.com/news/local-news/public-energy-co-op-explored
By COLIN M. STEWART
Hawaii Tribune-Herald
What if Hawaii Island residents owned their own electric utility?
That’s the question being posed by a nonprofit group that filed on Feb. 11 a motion with the Hawaii Public Utilities Commission to intervene in the pending $4.3 billion sale of Hawaii Electric Light Co’s parent company, Hawaiian Electric Co. (HEI), to NextEra Energy.
The Hawaii Island Energy Cooperative is a group of Big Island community and business leaders exploring the idea of public ownership, according to group spokesman and director Marco Mangelsdorf.
“We seek to participate in the discussion of the unique perspective of the residents of our island, and, if appropriate, explore an option that would make for a fundamental change in the landscape of energy production and consumption on Hawaii Island,” he said via a press release. “Being able to have more direct control over Hawaii Island’s present and future energy profile would provide us with an extraordinary opportunity to showcase what can be done on our island on many different and innovative levels.”
Mangelsdorf explained Tuesday that public ownership of the island’s electric service would mean that there would be democratic and local control over the island’s energy infrastructure, “providing greater benefits and retaining any excess over the cost of operations.”
The energy cooperative is headed by a local board of directors, including Hamakua Springs president Richard Ha, former University of Hawaii at Hilo spokesman Gerald DeMello, Office of Mauna Kea Management senior advisor Wallace Ishibashi, and Mangelsdorf, who is president of ProVision Solar Inc.
The group came together shortly after the announcement that Florida-based NextEra intended to purchase HEI, said Ha.
“It occurred to us it would be a good time to talk to the folks (at the Kauai Island Utility Cooperative),” he said.
The CEO of the Kauai group, the state’s only electric cooperative, David Bissell was invited to come to Hilo and speak with residents about his experience with forming and operating Kauai’s publicly owned electric service. From there, the idea to duplicate Kauai’s success on Hawaii Island gathered steam, Ha said.
Mangelsdorf admitted that much remains up in the air, including how financing for such a move could be secured. But, he said, the time to talk about forming a cooperative is now, so that Hawaii Island electric consumers can have a “seat at the table” as the PUC investigates the NextEra merger. He added that Hawaii Island Energy Cooperative “takes no position either for or against the proposed merger.”
“HIEC desires to explore through the proceedings the unique perspective, goals and objectives of the residents and communities of Hawaii Island, and depending on the outcome of the proceedings, consider whether a different ownership model for energy services on Hawaii Island may provide a positive alternative.” There are more than 900 utility cooperatives across the country, serving an estimated 42 million people in 47 states, according to the National Rural Electric Cooperative Association.
Mangelsdorf explained that co-ops can lower consumer electricity bills through their tax-exempt status, have lower capital costs, and don’t have to contend with shareholders to whom they must distribute profits. They also have a tendency to be “more nimble” when it comes to adapting new technologies, he said, and can expend greater effort to develop less expensive, island-based power sources.
Email Colin M. Stewart at cstewart@hawaiitribune-herald.com.
Big Island group explores forming utility co-op similar to Kauai
Feb 17, 2015, 6:03pm HST Updated: Feb 18, 2015, 3:00am HST
A group of community and business leaders on the Big Island have formed an organization to explore the potential benefits of a community-based cooperative ownership structure similar to the Kauai Island Utility Cooperative, and they want a closer look into NextEra Energy’s $4.3 billion acquisition of Hawaiian Electric Co.
The Hawaii Island Energy Cooperative recently filed paperwork to intervene in theHawaii Public Utilities Commission docket on the proposed acquisition, which involves HECO’s Big Island subsidiary, Hawaii Electric Light Co.
“We seek to participate in the discussion of the unique perspective of the residents of our island, and if appropriate, explore an option that would make for a fundamental change in the landscape of energy production and consumption on Hawaii Island,”Marco Mangelsdorf, director and spokesman of HIEC, said in a statement. “Being able to have more direct control over Hawaii Island’s present and future energy profile would provide us with an extraordinary opportunity to showcase what can be done on our island on many different and innovative levels.”
In December, Florida-based NextEra and HECO made a joint acquisition announcement, which is expected to be finalized in the fourth quarter. The deal still requires several approvals, including from the Hawaii Public Utilities Commission.
The cooperative said it is not taking a position on the acquisition at this time, but wants to bring to the docket, its specific focus on the energy needs of the Big Island and its unique perspective on potential cooperative ownership structures.
Some of the benefits the group has identified include:
- Local, democratic control over the island’s energy infrastructure, providing greater benefits and retaining any excess over the cost of operations for island residents.
- Community-based and community-chosen strategic priorities under which the cooperative operates for the sustainable development of the island.
- Potentially lower electric costs through tax exempt status, lower cost of capital and no shareholder profits, greater efforts to develop less expensive island-based power sources, promotion of education, markedly improved energy efficiency, and the accelerated adoption of appropriate advanced technologies.
- Greater overall energy independence, higher renewable energy generation, and enhanced sustainability through a comprehensive and integrated approach to all energy-consuming sectors on the island.
- Developing and emphasizing island-produced fuels to provide an energy source for both electric generation and transportation sectors.
http://www.civilbeat.com/2015/02/big-island-electric-co-op-seeks-to-intervene-in-nextera-sale/
Big Island Electric Co-op Seeks to Intervene in NextEra Sale
NextEra deal sparks talk of acquiring local control of the electric utility.
February 17, 2015·By Sophie Cocke
Big Island business and community leaders have formed a nonprofit coop called the Hawaii Island Energy Cooperative to explore taking over Hawaii Electric Light Co., a subsidiary of Hawaiian Electric Co.
The co-op would be owned by ratepayers, similar to the Kauai Island Utility Cooperative. However, the co-op is interested all of the island’s energy sectors not just the electric grid.
The co-op association emerged in recent weeks with the announcement that Florida-based NextEra Energy has entered into an agreement to purchase HECO — a deal that is expected to close by the end of the year. Last week, the Hawaii Island Energy Cooperative submitted an application to Hawaii’s Public Utilities Commission, which must approve the sale, to intervene in the review of the merger.
The Big Island co-op, in seeking to intervene in proceedings, is not taking a position for or against the sale, according to a press release issued by the co-op on Tuesday
“We seek to participate in the discussion of the unique perspective of the residents of our island, and if appropriate, explore an option that would make for a fundamental change in the landscape of energy production and consumption on Hawaii Island,” HIEC director Marco Mangelsdorf said in the press release. “Being able to have more direct control over Hawaii Island’s present and future energy profile would provide us with an extraordinary opportunity to showcase what can be done on our island on many different and innovative levels.”
Mangelsdorf is also the president of ProVision Solar, a Big Island solar company.
Other HIEC directors include Richard Ha, Wally Ishibashi and Gerald DeMello.
A co-op model could provide the following benefits, according to the press release:
· Local, democratic control over the island’s energy infrastructure, providing greater benefits and retaining any excess over the cost of operations for island residents.
· Community-based and community-chosen strategic priorities under which the cooperative operates for the sustainable development of the island.
· Potentially lower electric costs through tax exempt status, lower cost of capital and no shareholder profits, greater efforts to develop less expensive island-based power sources, promotion of education, markedly improved energy efficiency, and the accelerated adoption of appropriate advanced technologies.
· Greater overall energy independence, higher renewable energy generation, and enhanced sustainability through a comprehensive and integrated approach to all energy-consuming sectors on the island.
· Developing and emphasizing island-produced fuels to provide an energy source for both electric generation and transportation sectors.
You can read Civil Beat’s prior coverage of the co-op here: NextEra Deal Sparks Talk of Big Island Co-op