PEPE’EKEO, Hawaii – The struggling Hu Honua Bioenergy, LLC announced it has added three prominent Honolulu business leaders to its lineup, even though the company no longer has an agreement with the utility to sell the energy it plans to produce.
John Komeiji – the General Counsel and Senior Vice President of Hawaiian Telcom – is joining the company’s board of directors. Also, Duane Kurisu and Dennis Teranishi will participate on the company’s advisory board.
“I am excited to be part of this project,” said Komeiji in a media release. “It will provide a strong boost to the local economy, protect our environment, and give Big Island consumers protection from the volatility of the global oil markets, which, over the years, has made the price of electricity fluctuate unpredictably.”
In the February, the Hawaii Electric Light Company told the Hawaii Public Utilities Commission it intended to terminate its Power Purchase Agreement with Hu Honua effective March 1, following missed milestone schedule dates.
Hu Honua Bioenergy is trying to refurbish the former sugar mill power plant at Pepeekeo, transforming it into a modern biomass electricity generation facility with advanced emission control equipment. A power purchase agreement was approved by the PUC in December 2013, but since then Hu Honua spent months mired in litigation with previous contractor, Hawaiian Dredging Construction Company. HELCO cited missed deadlines in its decision to terminate the agreement, and said it does not appear as if Hu Honua will achieve commercial operations in the near future. HELCO even said they have no confidence Hu Honua “is being forthright in its disclosures to Company and/or that Seller has a sound business plan in place that is in the best interest of customers and makes sense financially for Seller’s investors.” The Power Purchase Agreement was terminated in March.
In an April 15 media release, Hu Honua principal investor Jennifer Johnson struck an optimistic tone. Johnson is Co-President of Franklin Resources, Inc., a global financial services company with more than $700 billion in assets under management. Johnson and her affiliated investors have reportedly committed an additional $125 million to complete work on the plant.
“We want all stakeholders to know that we are committed to being one of the best managed Hawaii-based companies in the energy industry,” said Johnson. “We are very fortunate to have some of Hawaii’s most accomplished business leaders joining our team, and I believe that speaks to Hu Honua’s capabilities and potential to do great things for the state. We hope to be allowed to fully perform under our power purchase agreement with Hawaiian Electric Light Company, which was previously approved by the PUC, and move forward to create a cleaner, more sustainable Hawaii together.”
Advisory board member Duane Kurisu praised Johnson in the media release. “Given her commitment and her experience in managing a global financial institution with a market capitalization of more than $22 billion,” Kurisu said, “I believe Hu Honua is on sound financial footing. I am enthusiastic about this project’s future and the benefits it will deliver to Hawaii Island and the Hamakua Coast where I grew up.”
“The contract with Hu Honua has been terminated,” stated HELCO president Jay Ignacio “however, Hu Honua has asked to discuss restarting the project. We are open to discussing but have made it clear that Hu Honua would need to address our concerns about their ability to complete the project and that they provide enhanced terms that benefit our customers.”
Hu Honua says the project is half way to being completed, and can be operational in 2017 if work can resume in the near future.