KE manager: Lawsuit won’t stop power plant

LIHU’E — Kaua’i Electric manager Denny Polosky isn’t particularly worried

about the outcome of a lawsuit filed by a citizens’ group last year that could

stall progress on the utility’s new Hanama’ulu power plant.

“I think we

have a very good case. I think these people that are protesting this thing are

off-base,” Polosky said, adding that he expects a decision from the court later

this year.

“So we’re still pursuing 390 (Amfac Sugar Kaua’i’s former field

390 site) as the most appropriate site” for the Lihu’e Energy Service Center

(LESC).

Citizens for Clean Air has appealed the county Planning

Commission’s decision to allow KE to construct the plant on the grounds that

the commission failed to follow various state and county laws when it reached

its Sept. 9 decision to approve permits for the plant.

The utility is

holding county permits necessary to move forward with the project (subdivision

approval is the next step), but is awaiting the court’s decision on the

appeal.

“We think we can get it done,” Polosky said. “We’re optimistic that

we need to pursue field 390 to the end, and we’re going to get that done this

year.”

Among the reasons why the power plant is critical to KE and the

island is that KE doesn’t know how long Amfac Sugar Kaua’i and Lihu’e

Plantation (LP) will remain in business, Polosky said.

If Amfac Sugar

Kaua’i and LP cease operations, KE will lose 14 megawatts of power LP’s mill

generates for KE.

“We’re concerned about what’s happening at Kekaha (Amfac

Sugar Kaua’i closing the former Kekaha Sugar mill), and then, what will happen

at Lihu’e eventually. And when that does, we’re not going to have this 14

megawatts available,” he said.

“And, eventually, that will happen. We know

that.

“If and when they go out of business, we need the power immediately.

So that’s one of the reasons that we contracted with Kauai Power Partners for

this new unit,” he said.

“If they go out of business, we only have a short

time to get something in to replace that. Because we’re behind our adequacy of

supply if they go out and they stop sugar,” he said.

By state Public

Utilities Commission (PUC) regulations, KE must have enough reserve power to

provide electricity for the island even if its largest generator goes down.

Without LP’s power, KE would be below that reserve-power threshold.

“We

actually sold more energy this year (1999) than we did the year before, and the

year before that. So we’re growing,” said Polosky.

And, with new projects

like the Marriott Waiohai Beach Club, Coco Palms, Alexander & Baldwin’s

Kukui’ula project, and the Puhi middle school, among others, coming on line, KE

is responsible for ensuring an adequate supply of electricity.

“Those are

very large loads that come on our system all at once,” Polosky said.

Base

rates won’t go up: The good news is that there will be no increase this year in

what KE customers pay for a kilowatt-hour (kwh) of electricity.

The bad

news is that, because of increases in the cost of gas and oil, the energy

adjustment on customers’ bills has risen.

Laws allow KE to pass on directly

to customers charges related to increases in the price of oil, which the

company burns to generate electricity.

“It has gone up recently,” said

Jenny Fujita, head of public relations at KE, speaking on the energy

adjustment.

When oil prices go down, as they did last year, consumers see

lower bills as a result of that same energy adjustment line item on bills, she

said.

Employees await news of sale: “The employees are curious about who

the new owner will be, and curious about what changes may occur once that new

ownership takes place, which wouldn’t be immediate, because there are

regulatory approvals,” said Fujita.

“I would say there is generally a mood

of curiosity, a sentiment of curiosity, right now. And I think, just in

general, at a time when there are so many changes going on in our company and

so many large issues right now, that there is a feeling of uncertainty,” she

added.

“But it’s a normal feeling, I think, during a time of change,” she

said.

“We all are anxious to hear,” Polosky said. “The uncertainty, I’m

sure, bothers some employees here, about not knowing who it is, who’s the new

owner or will be, but you need to press on and do what we need to do to provide

customers with service.”

The Gas Company (Gasco and Gaspro) is also for

sale as part of Citizens Utilities’ divestiture of its water, electric, gas and

wastewater utilities in favor of investment in telecommunications lines across

the Mainland.

The Gas Company has less than 20 employees on

Kaua’i.

Highest rates : KE’s customers pay around 19 cents per kwh of

electricity used, which is among the highest in the United States.

“We

probably have some of the highest rates in the country,” Polosky acknowledged,

adding that other islands in the Pacific and other parts of the world probably

have much higher rates than Kaua’i does.

The Big Island’s Hawaiian Electric

Light Industries has filed with the state Public Utilities Commission for a

rate increase which, if approved, would make the Big Island’s rates higher than

Kaua’i’s.

“What I know is that, for like places, in other words islands,

Long Island is as high if not higher than we are, and Guam is very similar,

too. I think they’re higher than we are,” Fujita said.

On O’ahu, the

average family uses over 650 kwh a month, while on Kaua’i an average family

uses about 480 kwh a month. Kaua’i’s residential average usage is the lowest in

the state, Polosky said.

“We’re very conservative users,” Fujita said. “And

I think that has actually gone down,” she said of Kaua’i’s average monthly

family usage.

“We’ve become more conservative over time,” with the monthly

average household usage last year closer to 500 kwh.

The average family’s

electric bill is around $100, which Polosky says is probably similar to many

other areas in the country.

KE hit its peak load during a weekend day in

November last year, at 70 megawatts (MW), lower than the 1998 peak of 72 MW,

Polosky said.

From one point of view, Polosky wishes people used more

electricity on the island. If more people use more electricity, the per-unit

cost would come down, he explained, “because we’d use the same generators to

provide it.”

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