LIHU‘E — Federal loan guarantees that took two years to secure will give Kaua‘i Island Utility Cooperative access to funding for new alternative energy projects, a KIUC official said Friday. The money will come from the U.S. Department of Agriculture’s
LIHU‘E — Federal loan guarantees that took two years to secure will give Kaua‘i Island Utility Cooperative access to funding for new alternative energy projects, a KIUC official said Friday.
The money will come from the U.S. Department of Agriculture’s Rural Utilities Service loan program. Hawai‘i Democratic Sens. Daniel Inouye and Daniel Akaka announced the $110 million loan guarantee Thursday.
“These funds will help Kaua‘i further harness the power of water and biofuel as part of an effort to lessen the county’s dependence on imported fossil fuels,” Inouye said in a statement. “In Hawai‘i we are blessed with unique access to renewable, sustainable sources of power and, for the sake of our environment and our economy, we have to continue our collaborative push toward a clean-energy future.”
KIUC’s favored technology at present is hydroelectric, using the flow of existing streams and rivers to generate electricity, said David Bissell, KIUC acting president and chief executive officer.
“There is no better use of borrowed money than hydro,” he said, noting that once the systems are built they can provide free power for 100 years or more.
The federal loans are “about the lowest-cost money that is available,” Bissell said. “It’s a great opportunity for us to make something happen.”
“Right now we are very focused on hydro,” he said. “Our first priority is renewable.”
The federal funds come from the same source — RUS —that was tapped to help purchase the for-profit Kaua‘i Electric and transform it into the nonprofit, member-owned KIUC.
“KIUC has shared the island’s frustration” with how slowly alternative-energy projects have moved forward on Kaua‘i, Bissell said.
Armed with the low-cost federal money the co-op is in a position to take the lead on projects instead of mainly being an interested spectator and end-purchaser of privately developed electric projects, he added.
Bissell called the funds “helpful,” adding they will give KIUC flexibility in pursuing alternative-energy projects.
Any projects valued at over $2.5 million require state Public Utilities Commission approval, he said.
KIUC’s $110 million loan guarantee includes nearly $73 million for hydroelectric-plant improvements and a 10 MW naphtha/biodiesel-fueled combustion turbine, the latter Bissell said would be located at the existing Kapaia power plant if it is built.
Hydroelectric power and biomass conversion accounted for 9 percent of KIUC’s fuel mix in 2009. The co-op will use the loan to expand both programs, according to the news release from Akaka and Inouye. There are currently six hydroelectric power stations on Kaua‘i.
“Developing renewable energy like hydroelectric and biodiesel helps us to make the transition away from dirty, imported fuels,” Akaka said in a statement. “These homegrown energy sources keep dollars in Hawai‘i while reducing pollution to our air, land and water.”
Hydroelectric power captures the kinetic energy of water as it moves from a high elevation to a lower elevation by passing it through a turbine.
The amount of kinetic energy captured by a turbine is dependent on the distance the water is falling and the flow rate of the water.
KIUC is one of 50 rural utilities and cooperatives in 31 states selected to receive guaranteed loans.
The loans are used to fund upgrades, expansion, maintenance and replacement of rural America’s electric transmission, distribution lines and generating equipment. The program also helps fund energy-conservation and renewable-energy projects.
• Paul C. Curtis, assistant editor and staff writer, can be reached at 245-3681 (ext. 224) or pcurtis@kauaipubco.com.