Hawaii Oil Dependence to Boost America’s Highest Power Bills
by Robert Tuttle, Bloomberg, Oct 30, 2018 (excerpts)
…Hawaii, which already struggles with the nation’s highest electric bills, could see them jump by as much as 20 percent in just two years thanks, oddly enough, to new regulations on fuel use in oceangoing ships.
The state depends on mostly low-sulfur fuel oil for about 70 percent of its power. In 2020, though, demand for that fuel is expected to surge, pushing up prices. The reason: New maritime rules that require ships worldwide to lower the amount of sulfur in their fuel….
“The average person has no clue,” said Shasha Fesharaki, the Honolulu-based executive vice-chairman at FGE, an energy industry consultant. “The rates are going to have to go up."…
Individually, Hawaiians paid 32.4 cents per kilowatt hour for electricity in August, more than 40% more than the amount paid by residents in number two Alaska, according to U.S. Energy Department data. That could easily rise by 20 percent, Fesharaki said….
At one point. the state was examining plans to use liquefied natural gas, which can be brought in by ship and would provide cheaper and cleaner electricity than oil. But Governor David Ige dismissed that alternative in 2015… (Ooops!)
Hawaiian Electric Industries Inc., the state’s largest utility, expects its fuel costs to rise on the island with the most people, Oahu, where the bright lights of Honolulu are located. Oahu uses only low-sulfur fuel, according to Shannon Tangonan, a company spokeswoman. Other islands -- such as Maui and Lanai -- use both low and high sulfur fuel, potentially balancing off the shifting costs….
islanders need to ready themselves to shoulder higher prices, at least initially. “If their electricity bill goes up $30 a month, that can affect a lot of people,” FGE’s Fesharaki said. “They’re going to get hit hard.”
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