Bioenergy firm asks Hawaii Supreme Court to vacate Public Utilities Commission decision

Hu Honua Bioenergy LLC, whose renewable energy project on the Big Island was rejected twice in the past two months by the state Public Utilities Commission, filed a petition Wednesday with the Hawaii Supreme Court requesting that the state agency be ordered to vacate its decision.

The petition also seeks a court order directing PUC commissioners James Griffin, Jennifer Potter and Leodoloff Asuncion to promptly conduct an evidentiary hearing and consider the reduction of greenhouse gas emissions in connection with Hu Honua’s amended and restated power purchase agreement, as previously instructed by the Supreme Court.

“We are asking the Hawaii Supreme Court to quickly intervene on this matter, as the fate of our employees and their families are at stake, and more than 200 jobs overall will be lost if nothing is done,” Honua Ola Bioenergy President Warren Lee said in a statement. “It’s appalling how unfairly the current PUC commissioners have treated Honua Ola and our employees, and how they disregarded the instructions of the Hawai‘i Supreme Court.”

Hu Honua, which does business as Honua Ola Bioenergy, is seeking the PUC’s approval to begin operating a $474 million biomass plant in Pepeekeo on the Hama­kua Coast that is 99% complete and will burn trees to produce energy. That energy would be purchased by Hawaii Electric Light Co. under an agreement between the two companies.

But now the case is headed to the Hawaii Supreme Court for the second time.

A legal challenge in 2017 by the environmental group Life of the Land landed the project at the Supreme Court, which eventually ordered the PUC in 2019 to reconsider the power purchase agreement because the agency failed to “explicitly consider” the state’s goal of reducing greenhouse gases, which is required under state law. The PUC reexamined the case and on July 9 issued an order reversing its previous decision by denying HELCO’s request for a waiver from a new competitive bidding process. The PUC said that long-term impacts of a 30-year contract would make the energy more expensive than other renewable- energy sources and that the public interest would be best served by requiring the project to be evaluated alongside other renewable energy proposals.

Hu Honua filed a motion with the PUC for reconsideration about 10 days later and last week the agency upheld its order and said the arguments by the company didn’t even meet the legal requirements for reconsideration.

“We have done everything asked of us by the PUC, including building out the facility to completion as the PUC ordered us to do in 2017, along with training and providing careers to dozens of Big Island residents,” Lee said. “We are now ready to produce renewable energy this year and make Hawai‘i less dependent on fossil fuels. The only thing holding us back and keeping Hawai‘i from moving forward are these three PUC commissioners.”

In its most recent order, the PUC said that based on the success of the first two rounds of HELCO’s ongoing competitive bidding process underway since 2017, it will direct HELCO to open a third round of competitive bidding, which will provide another opportunity for Hu Honua to advance its project for consideration.

But Hu Honua doesn’t want to go through the process again and claimed in its petition with the Supreme Court that the PUC commissioners abruptly ended the project without providing due process.

Among the company’s key points in its filing was that the PUC twice approved waivers from the agency’s competitive bidding framework for the project; hundreds of millions of dollars were spent to complete the project, as ordered by the PUC; and the Supreme Court ordered the PUC to hold an evidentiary hearing on the amended power purchase agreement, with findings to determine whether the PUC satisfied its statutory obligations.

Hu Honua also said the PUC delayed scheduling an evidentiary hearing to consider the agreement, then revoked the project’s waiver from the competitive bidding framework, thus killing the project.

The company said it is committed to plant and grow more trees than it harvests from commercially managed forests, and has committed that the project will be carbon negative as soon as practicable.

But environmentalists are concerned that even carbon neutrality cannot be achieved when considering the emissions produced during logging and processing of the wood.