Owner optimistic about restarting Puna Geothermal Venture plant by year’s end

Critics of the state’s only geothermal power plant, which was knocked out by last year’s Kilauea Volcano eruption, fiercely oppose the idea of the facility resuming operations.

But barring any unexpected developments, Puna Geothermal Venture could be producing electricity for the Big Island by the end of the year.

Executives with Ormat Technologies, which owns the plant, told analysts in late February the company anticipates the facility will resume generating power toward the end of 2019.

And with one or two possible exceptions, no significant obstacles for government approvals or requirements appear to stand in the way of Ormat achieving that goal, according to a Honolulu Star-Advertiser check with state and county agencies that regulate the facility and Hawaii Electric Light Co., the island’s main power company.

The 38-megawatt plant and Hawaii Electric Light, which had been purchasing electricity from the Puna facility until the May eruption, need mostly ministerial permits — for building, grading and well-modification — to rebuild or restore the facilities damaged or destroyed by Kilauea’s lava.

Such permits generally are issued as long as the applicant provides the necessary information required by the issuing agency. Public testimony is not a part of the process.

While skeptics believe the year-end goal is too optimistic, the ability to meet that timeline depends largely on whether PGV and Hawaii Electric Light can complete the work necessary to get the plant operational, connected to the grid and generating power again.

At the time of the shutdown, the facility was providing about a quarter of the Big Island’s electricity.

“I’m very optimistic about Puna,” Isaac Angel, chief executive officer of Nevada-based Ormat, told analysts in an earnings conference call Feb. 27.

During a visit to Hawaii in February, Angel met with Gov. David Ige, Hawaii island Mayor Harry Kim and Hawaii Electric Light management, and “they assured me that they’re doing everything that they can to help us meet our target to resume operation by the end of the year,” according to a transcript of Angel’s talk with analysts.

State Sen. Russell Ruderman, who represents the Puna district, is among the critics questioning that timeline.

“It’s absurd to think that could happen,” he said. “There might not be obstacles, but this also is not going to be a slam dunk.”

Among the main tasks facing PGV is making operational its system of wells, which tap underground heat sources to convert to electricity. As a protective measure, six of the property’s 11 wells were plugged last year as lava approached the plant.

The lava eventually covered three wells and destroyed a substation, adjacent warehouse and large drilling rig.

Angel told analysts the company was unplugging the first of its production wells that week and, although other tests seemed positive, “we cannot be sure that those plugged wells are intact.”

Asked last week for an update on the wells, a company spokesman told the Star-Advertiser he was not authorized to provide information beyond what was disclosed in the February earnings call.

Hurdles to rebuilding

Before the plant can resume operations, two other critical tasks must be completed.

The Hawaii Electric Light-owned Pohoiki substation, which serves as the connecting point to the PGV plant, and the two high-voltage transmission lines that connect the substation to the grid have to be rebuilt.

Public Utilities Commission Chairman Jay Griffin told the Star-Advertiser in an email that the panel would need to review Hawaii Electric Light’s plans if the cost to rebuild the substation exceeded $2.5 million or the utility proposes to install transmission lines of 46 kilovolts or greater. A proposal to install transmission lines of 46 kilovolts or greater also may require a public hearing, Griffin wrote.

The rebuilding project will not cost the utility or its customers any money because it will be covered by insurance proceeds and PGV funds, according to documents Hawaii Electric Light filed with the commission on Friday.

The new transmission lines will be 69 kilovolts each — same as the old ones — but above the threshold mentioned in state law. That law says the PUC must hold a public hearing if above-ground lines of 46 kilovolts or greater are proposed to run through any “residential area.”

But the land on which the two lines will be constructed is zoned agricultural and is not in a residential area, according to a cover letter to the commission from Kevin Katsura, a regulatory affairs executive with Hawaiian Electric Cos., the Big Island utility’s parent company.

“The only two residences left in the general vicinity of PGV’s facility are 400-500 feet away from where the lines will be reconstructed,” Katsura wrote.

He said the company doesn’t believe the projects require PUC approval, but if the commission determines otherwise, the utility will abide by that decision.

“We’re working closely with PGV to help them meet their deadline of getting back online by the end of 2019,” Hawaiian Electric spokesman Jim Kelly said in an email to the Star-Advertiser.

Another wild card with the potential to disrupt PGV’s timeline is the company’s state-issued air permit.

The permit expired in 2014 but is still valid, according to the state Department of Health, the issuing agency. State regulations allow a permit to remain in effect if the holder submitted a complete renewal application 60 days prior to expiration.

For the plant to resume operation, however, it must be in compliance with the permit terms, including having permanent, stationary air-monitoring stations operating, according to Janice Okubo, a Health Department spokeswoman.

The plant currently has only temporary monitoring stations, Okubo said.

The Star-Advertiser could not reach anyone from the company Friday to ask about plans to erect permanent stations.

Air quality issue

The issue of air quality has regularly stirred controversy since the plant began operating nearly three decades ago.

Area residents over the years have repeatedly complained of being sickened by noxious gases, including hydrogen sulfide, released from the facility. Its owner has been fined several times in the past five years for violations related to gas releases and other infractions.

In the most recent instance, the Health Department fined PGV $11,100 in October for a variety of violations, including the failure to prevent accumulated wellhead gas or other geothermal fluids from being discharged into the atmosphere without first going through a hydrogen sulfide filtering system, according to state records. Those releases happened on two dates in 2016.

Growing concerns

And now that the forced shutdown has underscored the risk of placing a plant in a rift zone of one of the most active volcanoes in the world, critics are amplifying their concerns.

“I don’t think they should be rushing to go back online without doing due diligence,” said Robert Petricci, who lives about a mile from the plant.

Henry Curtis, who represents Life of the Land and Puna Pono Alliance, two organizations that oppose the plant going back online, said questions about the higher cost of geothermal power in relation to other renewable energy forms are among the groups’ concerns.

Curtis said he would be amazed if PGV could meet its year-end timeline. “I seriously doubt that,” he said.

Ruderman and others also cited the cost issue, noting that Hawaiian Electric earlier this year touted the low-price benchmarks set by seven planned solar-plus-storage projects that are now under regulatory review, including two 30-megawatt plants on the Big Island. The facilities would have batteries capable of storing power.

The cost per kilowatt hour pegged for the two projects is 8 to 9 cents. For PGV, Hawaii Electric Light paid about 12 cents on average for the bulk of its purchases in fiscal year 2018, according to state records.

Hawaiian Electric’s Kelly cautioned about making direct comparisons.

“Every renewable energy choice has pluses and minuses,” he said. “The biggest positive for geothermal is that it delivers firm, reliable generation 24 hours a day like a traditional power plant, but without burning fossil fuels. Solar, even with battery storage, is a great resource but it’s also a variable one with limits on how much power it can produce. So from a power generation standpoint, they’re not equivalent options.”

Kelly said the PGV plant is an important contributor to the state’s renewable energy portfolio.

If the plant had been online for all of 2018, Hawaii Electric Light’s renewable energy portion would have totaled 64 percent, according to Kelly. Without PGV, it was 44 percent.