Ranch aims to become a provider of power

Looking to create a hedge against rising electricity prices, Parker Ranch has hired a team of consultants to determine whether the 130,000-acre ranch could meet its energy needs with renewable sources and have enough power left over to supply the neighboring town of Wai­mea and possibly other parts of Hawaii island.

The three-company consortium of Sie­mens PTI, Pace Global and Booz Allen Hamilton was selected last week by Parker Ranch after a yearlong process that began with as many as 18 companies expressing interest in undertaking the proj­ect, said Neil "Dutch" Kuy­per, Parker Ranch president and chief executive officer.

Parker Ranch is a working cattle ranch founded more than 160 years ago which supports health care, education and charitable giving in Wai­mea through a trust formed in 1992.

The ranch’s motivation to evaluate its renewable energy resources was driven primarily by the high cost, and price volatility, of electricity provided by Hawaii Electric Light Co., Kuy­per said. Hawaii island residents and businesses pay among the highest electric rates in a state where the price of electricity is already three times the national average.

The consortium of energy experts hired by Parker Ranch is tasked with producing an "integrated resource plan" that will explore a wide range of options for the ranch to choose from, Kuy­per said.

At a minimum, ranch officials would like to develop a "microgrid" that could provide the energy needs of the ranch using a variety of renewable energy sources, he said. However, the hope is that there would be enough renewable energy generating capacity to supply all or parts of nearby Wai­mea, Kuy­per added.

Included in Parker Ranch’s mission statement is a commitment to support four nonprofit organizations in Waimea: the Parker School Trust Corp., Hawaii Preparatory Academy, Hawaii Community Foundation’s Richard Smart Fund and the North Hawaii Community Hospital.

"If there is a way to partner with the community and do a community grid, it seems like a real logical proposition to explore," he said. "Ultimately this is about lowering the cost of electricity for residents and businesses. That’s the goal."

Kuyper said he will discuss Parker Ranch’s plans during the Asia Pacific Clean Energy Summit being held this week at the Hawai‘i Convention Center.

North Hawaii Community Hospital, the largest consumer of electricity in Wai­mea, pays an average of $1.2 million to $1.4 million a year for electricity, Kuy­per said. Parker Ranch’s bill averages about $300,000 a year, he said.

All options are on the table at this point, including running the microgrid or community grid separately from the HELCO grid, which serves all of Hawaii island, Kuy­per said. The consultants hired by the ranch also will look at the possibility of feeding electricity into the HELCO grid, Kuy­per added.

He said HELCO, a subsidiary of Hawaiian Electric Co., is still working with the Public Utilities Commission to gain approval of its own integrated resource plan. The timing might be right for HELCO to consider incorporating some of the Parker Ranch plan into its own, Kuy­per said.

Parker Ranch has good potential for wind, solar and biomass development, according to Kuy­per. The ranch also has a geographic feature that few other private landowners in Hawaii have: a 7,000-foot elevation change.

Such a large variation opens the door to developing a type of renewable energy technology called pumped-storage hydro­power, Kuy­per said.

In most pumped storage proj­ects, two reservoirs are constructed. During times of low electricity demand, such as late night into the early morning, wind energy can be used to pump water uphill. When power is needed during high-demand periods, the water is released through turbines.

While 40 large-scale pumped storage proj­ects currently operate in the United States, none is in Hawaii, according to the Energy Information Administration.

CORRECTION: Booz Allen Hamilton is part of a three-company consortium selected last week by Parker Ranch to determine whether the ranch can meet its energy needs through renewable sources. An earlier version of this story and the story in the print edition misspelled the company’s name.