Hawaii Energy Cost: Double U.S. Average and Likely to Stay There

Another disadvantageous first for Hawaii, and most of it due to our price of electricity.* We are hooked on oil and the future does not bode well for us because actually it may be cheaper to stay with oil.

Notably crude oil pricing today is at $80. Oil prices may decline further to around $50/barrel (in year 2000 constant dollars) for more than a decade because:

1. China, India and Germany are focusing on coal. Brazil on ethanol.
   
2. The success of fracking and other unconventional methods for extracting natural gas (see below.)
3. The expected reduction in the political turmoil of oil producing countries.
4. The localized success of electric vehicles and the continues improvements in vehicle MPG.
5. The modest introduction of additional large nuclear plants, wind and solar installations.

There is great attention focused on natural gas, worldwide. According to The Economist, August 9, 2011 existing and potential assets (in parentheses) of natural gas for a half dozen countries are as follows, in trillion cubic meters. These are truly vast energy deposits:

• Argentina 0.4 (21.9)
• Australia 3.1 (11.2)
• Canada 1.8 (11.0)
• China 3.0 (36.1)
• Poland 0.2 (5.3)
• USA 7.7 (24.4)

As a result of all these, the likelihood of large price drops in the development of renewable technology is less rosy. This is a major loss for Hawaii which is too tiny to absorb the costs of developing technology.

(*) ENERGY COST INDEX 2011: RANKING THE STATES, August 2011.

Data Sources for the chart with data from SBEC: Gas price index from gas prices provided by the AAA’s website www.fuelgaugereport.com accessed on July 22, 2011, and electricity cost index is an index of state’s average revenue per kilowatt-hour for electricity utilities (data for 2011 through April from the U.S. Energy Information Administration).

It's August 6 in Hiroshima, and 1945 in Detroit.

Image 1: Man-made devastation (1945) ...
Image 2: ... and spectacular recovery (2010) in Hiroshima, Japan.
Image 3: One hopes the same for Detroit and other decimated American cities.
But the happenings in Washington, D.C. give no such hope.

Trains Helped Kill the Greek Economy – They’ll Kill Hawaii’s too

“Some years back a Greek finance minister, fed up with his country's waste and extravagance claimed that he could save money by shutting down the national railway and driving around its passengers in taxis.” [1]

Too bad he didn't execute his plan for the closure of the railways. In 2009 the Greek railways collected $250 million in fares and posted a net loss of $1.4 Billion. A Billion wasted here, and a Billion wasted there … the rest is history for the Greek economy. Greece is now in a debt crisis.

In 2000 a Greek colleague and I conducted research on Greek railroads and we developed models which predicted that the rail freight service would soon carry nothing [2]. No way, they said. Four years later the freight operations of Greek shut down for good. Unfortunately, investment on Obama-like medium-speed rail passenger service continued unabated in Greece. So the budget hole got even bigger.

The lesson here is that public investment in non-performing infrastructure will eventually swamp the budget and saddle current and future generations with a heavy debt burden. Non-performing is any infrastructure in constant need of subsidy whose contribution to the economy is less than its true cost. Roads cost a lot, but contribute much more to the economy, health and safety of the population. Trains cost even more, but offer much much less.

What do you think the future holds for our tiny island that "wants" a five to seven Billion dollar train?

What do you think the future holds for the car-dependent, and highway and airport vested state of California which still plans for a $35 Billion “high speed rail”? A lot of good answers can be found in the article: High Speed Rail and Social Equity. Basically, the only high speed rail that makes sense (and money) is the 340-mile Shinkansen. All the rest, including California's, are A Fast Track to Nowhere.

The lessons about trains "modern" trains can be summarized by three common sense idioms, as follows.

You can’t teach an old dog new tricks. Trains went obsolete for a reason. You can’t solve 21st century mobility problems with 19th century technology. There are always a few exceptions, but Greece, California and Hawaii trains have nothing exceptional.

Those who refuse to do arithmetic are doomed to talk nonsense. One can write a book on this but I will mention only three rail related “math” of Honolulu mayor Peter Carlisle: (1) Get Honolulu’s financial house in order ... by spending over five billion on rail, (2) HART will cost us nothing, and (3) The Ansaldo contract will save Honolulu tens of millions in rail costs. All of them pure nonsense.

They are taking Honolulu for a (train) ride. Biased politicians, biased government officials and their paid consultants deceive the public in order to get elected, become chief of a new division and make millions, respectively.


[1] The Economist, July 2, 2011, p.8.
[2] Paravantis, John A. and Panos D. Prevedouros, Railroads in Greece: History, Characteristics and Forecasts. Transportation Research Record, No. 1742: 34-44, 2001.

Honolulu Rail in Illegal Pact with Local Unions

UCLA Urban Planning Professor Brian Taylor sent me this brief but informative article about California's proposed High Speed Rail: High Speed Rail and Social Equity.

It contains a lot of interesting points and many of them such as construction cost, jobs, "green" transportation and equity apply to Honolulu's proposed heavy rail. However, one passage caught my attention:

"Since the federal regulations currently applicable to transportation infrastructure construction prohibit local hiring preferences, it is unlikely that there will be many jobs for low income people and people of color." No jobs for locals and Hawaiians?

True! The Code of Federal Regulations 23 CFR. §635.117 part (b) reads as follows: “No procedures or requirement shall be imposed by any State which will operate to discriminate against the employment of labor from any other State, possession or territory of the United States, in the construction of a Federal-aid project.” The rail project is clearly a Federal-aid project.

Contrast the facts above this fact from the recent past: Labor Unions Sign Rail Agreement with Honolulu City Officials. The goals of the RTSA include utilizing local labor for high quality work, on time and on budget. The mayor also stated that the agreement will avoid slowdowns and work stoppages.


This “partnership is a working relationship,” said Mayor Hanneman beside labor union leaders, in a conference room packed with reporters and laborers alike. In attendance were signatories to the agreement including: Ronald Taketa of the Hawaii Carpenters Local 745, Joe O’Donnell of the International Brotherhood of Ironworkers Local 625, Peter Iriarte of the International Union of Bricklayers & Allied Craft Workers Local 1, Vaughn Chong of the International Union of Painters & Allied Craft Workers Local 1791, Peter Gamban of the Operative Plasterers’ & Cement Masons’ International Association Local 630 , and William Mahoe of the Operating Engineers Local 3.

And all of it is illegal!

Solar Power Plant on Oahu Does not Pass Muster

A five megawatt facility with solar thermal collectors is planned on DHHL lands. The provider and contractor is a local firm that has a smaller deployment on the Big Island.

The Big Island facility has used millions of taxpayer money in the form of technology credits to provide basically a tiny amount of usable energy, if any. As shown in the list below, depending on the source, the Big Island facility is mentioned as being able to generate 2000 KW (2 MW), 500 KW or 100 KW and to be feeding power to HELCO, the Big Island utility. The watt (W) is a measurement of electric power; KW is kilowatt and is equal to 1,000 watts; MW is megawatt and is equal to one million watts.

• Source (1) says that the power purchasing agreement started in January 2010 for 2 MW.
• A description of the same Big Island facility specifies 2 MW for $20 million invested using 1,008 solar concentrating panels on 4 acres of land; see source (2). That's $10 Million per MW which is expensive. It comes to $10 per watt whereas rooftop photovoltaic (PV) panel system costs about $5 per watt (See note 1).
• The company’s CEO said to me in person —and in source (3) cited below—that the facility produces 500 KW. That's $40 Million per MW which is absurdly expensive because now the cost is $40 per watt.
• The Nevada based electric generator manufacturer who sold the Green Machines that presently operate on the Big Island facility in question specifies two 50 KW generators. So the 4 acre site has a maximum power generation of just 100 KW; source (4). The CEO of the Big Island facility is quoted saying this: “The delivery and performance of the Green Machines have allowed us to fully utilize our solar field…” This means that indeed all that this facility can do on a sunny day without clouds is 100 KW. Now the cost per MW is clearly in the stratosphere at $200 Million per MW or $200 per watt.

The reduction from all this information is that 1,008 panels and 4 acres are required to produce 0.1 MW which is mostly used internally and none of it is sold to HELCO. Unlike a PV system, this concentrated solar panel system requires a lot of electricity to operate pumps, valves, and sun-tracking motors. This means that the amount of electricity sent to the grid is less than the 100 KW stated above, which further increases the cost per MW.

Oahu's daily needs exceed 1,200 MW. If this technology were to power Oahu it would require 48,000 acres and zero cloud cover over the panels 365 days a year. In addition a very large quantity of water would be needed to cool down the generators.

It appears that this locally developed technology of micro solar collectors (sun tracking troughs) can physically produce a small amount of electric power, but it does so at an exorbitant cost, especially when compared to other environmentally benign renewables such as PV.

Given all these facts, now I have several questions:

1. Were 1,008 solar troughs, that cost millions of dollars in high technology tax credits, installed for HECO TV commercials, politician photo ops, and investor enrichment?
2. Does HECO and the PUC have any idea as to what works, what doesn't and at what cost?
3. How can a solar plant with 1,008 collectors produce 2 MW per day and have zero sales to the utility? My home solar panels produce 0.0016 MWh per day and HECO knows all about it.
4. Have we legislated mandates that promote unreasonable ratepayer charges? Right now Hawaii power customers pay over 250% more for electricity than the mainland. Why do we develop policies and select options that make this premium go even higher?
5. One of the five stated purposes of Hawaii's PUC is to "Foster and encourage competition or other alternatives where reasonably feasible in an effort to provide consumers with meaningful choices for services at lower rates that are just and reasonable." Purchasing power from a power generating facility at a cost exceeding 22 cents per KWh is very expensive. Why does the PUC entertain rates higher than 25 cents per KWh specifically for “Concentrating Solar Power” as stated in the Feed-in Tariff (FIT) rates?
6. This preferential rate for a single technology is twice the baseline FIT rate of 13.8 cents per KWh for other renewable energy technologies. Why?
7. Such a discriminatory pricing begs another question: Is Hawaii so desperate for a local success story that we waste millions of taxpayer and ratepayer dollars in uncompetitive overpriced technologies?

My questions point to a lack of due diligence or breach of fiduciary duty on the part of the utility industry in Hawaii, its regulators and our legislators. The governor must obtain an understanding of the realities of the renewable energy game in Hawaii. Or perhaps the governor is the problem – I mention it as a possibility, but I suspect that he's never received an unbiased briefing.

Hawaii’s energy arena needs clear metrics and performance based contracting, not fake promises and preferential treatment. Hawaii needs fact-based energy leadership, not rhetoric and commercials!

LINKS CITED: Source (1), Source (2), Source (3), Source (4), Note (1): A Price Point for Rooftop Solar Panels

Traffic Accident Investigation on Oahu: Stuck in the 1980s.

Civil Beat's Alia Wong has aired the festering problem of Honolulu Shutting Freeways Longer Than Other Cities which is indicative of Oahu's multilayered traffic mismanagement.

As far back as 1998 I wrote this opinion in the Star Bulletin: It takes too long on Oahu to investigate accidents.

Although the HPD is usually confronted with traffic crashes that are "manini" compared to those on the mainland, where jack-knifed trucks get mangled with several other vehicles, it takes hours instead of minutes to deal with incidents.

An incident on Kalanianaole Highway on Dec. 12 prompted me to write this letter. It was reported that at about 1:30 p.m. a car veered into a moped about half a mile east of Aina Koa Street.

At 2:30 p.m. I joined the queue, which had extended for more than a mile on H-1 freeway. It took 28 minutes to drive 1.5 miles. At the crash site, I saw a smashed moped, a car on the shoulder and at least six police vehicles.

Most streets around Kahala Mall were jammed. Waialae Avenue was gridlocked and the off-ramp was overflowing onto the freeway, creating a hazardous situation. At 4:30 p.m., police were still investigating and the queue on H-1 had reached Kokohead Avenue.

I estimate that this three-hour traffic "management" incident trapped more than 9,000 vehicles and more than 12,000 motorists. It caused more than 6,000 people hours of delay, increased the risk for secondary accidents, and resulted in more than 1,500 gallons of additional fuel consumption.

The mayor and the chief of police must remove the archaic and inefficient procedures for incident management and give our officers the education and training needed to get in step with contemporary national practice.

I am subcommittee chair of the Freeway Operations committee of the U.S. Transportation Research Board and I have assisted Attica Tollway in several operational issues. Some of my work on Freeway Incident Management has been published in professional, refereed venues, as follows:

• Incident Management Simulation on a Two Freeway Corridor in Honolulu. Proceedings of the 6th ITS World Congress, Toronto, November 1999.
• Video Incident Detection Tests in Freeway Tunnels. Transportation Research Record, No. 1959: 130-139, 2006.
• Automated Incident Detection and Automated O-D Generation for Freeways, Panel Session 539 on NEW TECHNOLOGY FOR FREEWAY OPERATIONS, Annual Meeting of TRB, Washington, D.C., 2006.
• Freeway Incidents – US, UK and Attica Tollway: Characteristics, Available Capacity and Models, Transportation Research Record, No. 2047: 57-65, 2008.

In all these years I have never been consulted by the city or state departments of transportation, or the traffic division of HPD. Apparently, all of them know all there is to know. And the results are obvious.

MEGA RAIL IN A MICRO CITY

Article published in New Geography. Also appeared in the Washington Examiner, NCPA, Hawaii Reporter and elsewhere.

An exorbitantly costly rapid transit heavy rail project has been proposed for the small Hawaiian island of Oahu, where the leading metropolis, Honolulu, ranks 53rd in population among U.S. cities, with less than 950,000 people. If the project moves forward it will be the world's only elevated heavy rail in a metro area with a population of under four million.

Nothing about this 20-mile long rail project makes sense, except for its politics and its cronyism. It is projected to cost $5.3 billion according to the financial analysis of the city, or $7.2 billion, according to the state. For comparison, the Blue Line between Los Angeles and Long Beach that opened in 1990 has the same length and would cost roughly $1.5 billion to build now.

Cities worldwide and in the U.S. have shown a clear preference for light rail. The only rapid transit (heavy rail) system built in the US since 1990 is the one in Los Angeles in 1993; another was constructed in San Juan, Puerto Rico in 2004. In the same period, 19 light rail systems were installed.

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