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Wind partner unable to find location; Company says major Molokai landowner refused to negotiate  

Credit:  By Harry Eagar - Staff Writer, The Maui News, www.mauinews.com 13 May 2011 ~~

First Wind Hawaii, the principal partner of Maui’s Kaheawa Wind Farm, has apparently been frozen out of the no-bid project called “Big Wind” that is a centerpiece of the Hawaii Clean Energy Initiative.

First Wind officials said they were not able to find a site to locate a proposed 200-megawatt wind farm on Molokai, because the island’s major landowner, Molokai Ranch, refused to negotiate with them. Last month, the Public Utilities Commission rejected First Wind’s request for more time to identify a location for the project, ruling that First Wind was not a party to the 2008 agreement that evaded the usual competitive bidding process.

“We’re disappointed, but it was not unexpected,” said John Lamontagne, director of corporate com-munications for First Wind. “We appreciate the PUC’s consideration.”

First Wind Chief Executive Officer Paul Gaynor warned the PUC in a letter in March that if plans for a Molokai wind farm falter, “the state would have put itself in a situation where there is a single point of failure – the Lanai wind farm.”

The no-bid project stems from an earlier request by Hawaiian Electric Co. for companies to submit proposals for the development of 100 megawatts of renewable energy on Oahu.

Castle & Cooke and First Wind responded with unsolicited proposals to develop 200-megawatt wind farms on Lanai and Molokai, respectively, that would be delivered to Oahu by undersea cable.

With backing from the state Department of Commerce and Consumer Affairs, the commission decided to separate the original Oahu requests for proposal and allow the Lanai and Molokai proposals to continue as no-bid projects.

First Wind is the principal partner of Kaheawa Wind Farm on Maui and is in the process of expanding with an additional 21-megawatt wind farm called Kaheawa II.

The commission set a deadline of March 18 to submit proposals for the Lanai and Molokai projects. Castle & Cooke, as Lanai’s major landowner, had no difficulty showing that it had secured a site. But First Wind could not do so for Molokai.

The company said it tried half a dozen times to reach an agreement with Molokai Ranch, which controls much of the open land on the island and practically the only part of it big and windy enough for a project on the scale being proposed.

Molokai Ranch Chief Executive Officer Peter Nicholas did not respond to a request for comment. First Wind officials said the ranch ignored their proposals.

First Wind asked the commission for a four-month extension of the time limit for submitting a term sheet, which would detail the company’s proposal. Until now, the discussions have been framed in general terms, although environmental impact studies are under way to detail what a giant wind project would mean.

First Wind acknowledged that it was not a party to the 2008 agreement to circumvent the competitive bidding process. Although that agreement named Castle & Cooke and First Wind as the participants, the parties were Hawaiian Electric and the state Division of Consumer Advocacy.

Executive Director Jeffrey Ono of the consumer office said a postponement might have an impact on HECO’s ability to meet its renewable energy standards, set by the state, but that the consumer advocate “does not object” to the request for additional time.

HECO did object.

It told the commission that First Wind had not executed a term sheet, and Castle & Cooke had executed a “second option.”

The first option, which First Wind agrees was contemplated in the 2008 agreement, is that if either developer could not go forward, the other could develop 350 megawatts, instead of 200, and that 50 megawatts could go out to bid.

First Wind said it was unaware that any second option was in that agreement, nor that Castle & Cooke had any right to bring in an unknown outside party or “assign” First Wind’s half of the scheme to somebody else.

Lamontagne said: “We think the next steps will be for the PUC and other policymakers to decide what path to take forward on the interisland cable. We look forward to their decisions.”

Earlier this month, the commission denied a petition from the nonprofit Friends of Lana’i group to intervene in the proceedings involving the Big Wind project. The group called for reopening the bidding process.

A proposed wind project on 12,800 acres on Lanai has drawn strong community opposition.

The commission said the Lanai group was not a party to the proceeding and didn’t have authority to intervene. The panel also ruled that the request was too late to be considered.

Source:  By Harry Eagar - Staff Writer, The Maui News, www.mauinews.com 13 May 2011

This article is the work of the source indicated. Any opinions expressed in it are not necessarily those of National Wind Watch.

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