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Wednesday, July 25, 2018
Lalamilo: Newly Built Windfarm in Default after 10 Months--Demands Subsidy
By Selected News Articles @ 3:07 PM :: 7337 Views :: Hawaii County , Energy, Cost of Living

Another Lalamilo Windfarm Set to Become Junkyard: Windfarm in Default Demands Free Money from Water Ratepayers

From West Hawaii Today July 25, 2018 (excerpts indented with Editorial Comments to provide clarity) 

…The agreement was signed in 2013 and was born of a request for proposal administered through the county that sought a private company to construct and operate a wind farm to power eight deep wells at the DWS Lalamilo-Parker Well Sites in South Kohala.

Site Constructors, which won the bid, formed LWC as a special purpose entity to run the project. LWC subsequently invested $15 million and built a wind farm that went to full-operational status in September (just 10 months ago).

Clue: Special Purpose Entities are formed to shield the parent company from liability when the entity inevitably goes BK.

Really Obvious Question: Is the ‘Special Purpose Entity’ now skimping on windfarm maintenance?  How long until the blades start falling off?  

Since then, DWS has purchased between only half and two-thirds of the clean energy LWC produces, said Richard Hardin, member/manager at LWC….

Clue: This is normal.  Wind is garbage electricity which is available when you don’t need it and unavailable when you need it most.

“They’re relying on a very small item in the power purchase agreement that says they’ll take energy from the wind farm when they need it,” Rolston said.

Translation: "Very large item." 

IQ Test: Are you laughing?

Hardin explained (claimed) that DWS, his company’s only customer, must purchase a minimum of 8,000 megawatt hours (Mwh) annually to keep the project financially viable. That equates to roughly $180,000 in energy purchased per month.

However, DWS hasn’t met that purchase pace, or even come close, in any month since LWC went fully operational. Instead, they’ve made up the difference by purchasing nonrenewable energy from HELCO at 41 cents per kilowatt. LWC charges a fixed rate of 27 cents per kilowatt for its renewable product.

Reality: $0.27/kwh is a wholesale rate double the average retail rate on the Mainland.  $0.41/kwh is the rate we pay on the Big Island so schemers can get away with selling overpriced wind energy.

The strain has put the company in default with its lender and threatens a major source of renewable energy on Hawaii Island. Hardin said the Water Board’s decision to push a decision for the second consecutive month adds that much more peril to LWC’s financial situation.

Reality: Hawaii's new windfarms will all end up as spinning junkyards just like the eariler generation of windfarms--including an eariler windfarm at the Lalamilo site.

DWS is the largest energy consumer in the county and the eight wells LWC services gobble up about 25 percent of total departmental consumption.

Representatives from LWC went in front of the Water Board at its meeting in June and asked the Board mandate DWS purchase at least the 8,000 Mwh annually.

Translation: The windfarm is demanding that DWS buy electricity it is unable to use.  Water ratepayers would be required to pay higher rates to subsidize the windfarm.  Meanwhile, the failure of the windfarm to deliver the electricity DWS needs when DWS needs it is driving costs up.

The Hawaii County Water Board voted Tuesday to raise the power cost charge to ratepayers, while choosing to defer action in a power purchase agreement dispute between the Department of Water Supply and Lalamilo Wind Company.

Board members were unanimous in their support of a power cost charge hike from $1.88 to $1.94 per 1,000 gallons. DWS cited increased electricity costs from Hawaii Electric Light Co. (HELCO) as the basis for its increase request.

read … Wasting energy?

IM: Lalamilo Wind Company is a subsidiary of Site Constructors Inc (SCI). Another SCI subsidiary, Hawi Renewable Development (HRD), built and owns the Hawi Wind Farm.

HTH: DWS counters claim of obligation to purchase renewable energy for well site

History repeats Itself: Lalamilo: Another Hawaii Wind Energy Junkyard



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