Thursday, December 2, 2004

Downtown could
bathe in cool water

A company wants to build
a station in Kakaako that
could use seawater to
chill office buildings

Cooling yourself with Hawaii's waters soon might be possible without a trip to the beach if a Minnesota-based company's plans are realized.

Market Street Energy LLC of St. Paul, Minn., is drawing up a $100 million plan to pump deep-ocean water for use as a renewable cooling agent for air-conditioning systems in Honolulu buildings.

It may seem like a pipe dream, but the company already has enough willing investors to meet its equity-capital needs. And yesterday, the Hawaii Community Development Authority agreed to enter into talks with the company's local subsidiary on a lease option for about 15,000 square feet of land near the Kakaako waterfront for a seawater pumping station site.


"That's a critical step because we need to have a facility near the shore and near the customer base," said David Rezachek, who heads up the local subsidiary, Honolulu Seawater Air Conditioning LLC.

Though no lease deal is imminent, Rezachek said a site in Kakaako would be the ideal location for the seawater-based cooling network due to the proximity to downtown and the 45-degree water available offshore.

The system, targeted to begin in 2007, would draw water from the ocean floor about 3.5 miles off the Kakaako coast at a depth of 1,600 feet. That water would be sucked up to the station and would be used to cool fresh water distributed to the air-conditioning systems of 65 public and private buildings in the downtown and Kakaako areas.

Gov. Linda Lingle recently set a requirement that 20 percent of the state's energy come from renewable sources by 2020. Toward meeting that goal, the state Legislature liked Honolulu Seawater's plan so much that it released $32 million of special-purpose revenue bonds for the project during the past session.

Rezachek said the company plans to seek an additional $48 million from the Legislature in the coming session.

The remaining $20 million will come from equity investors. Rezachek said a pair of mainland companies already have expressed interest in meeting that full amount but that the company was seeking a greater number of investors, including local investors.

Ultimately, users will foot the bill for the system. But Honolulu Seawater estimates the system will reduce a building's energy costs for air-conditioning -- which make up about 40 percent of an office building's energy needs -- and shield those costs from future spikes related to the price of oil.

"Every business has to plan each year's expenses but if the price of oil keeps going up, you can't do that. This will make budgeting expenses much easier," he said.

Standard Hawaii air-conditioning systems involve pumping cooled water throughout a building. Cool air is then blown across pipes filled with the water to cool rooms, after which the water returns to a central location to be recooled in systems powered by electricity.

Honolulu Seawater said its system would be more environmentally friendly and reduce fossil-fuel consumption by 80 percent.

He added that it would save 400 million gallons of potable water a year, 215,000 barrels of oil, and 126 million gallons of sewage created by existing air-conditioning networks.

Hawaiian Electric Co., which warned recently that electricity demand may soon outpace its generating capacity, is enthusiastic about the seawater plan.

"We see that as being a very good project to help reduce demand for electricity and add a renewable energy source and we would work toward getting rebates for those customers that participate," said David Waller, a HECO vice president.

The plan would require no changes to existing air-conditioning networks, other than a hook-up to the cooled water supplied by Honolulu Seawater.

But supplying that water will be a challenge, requiring the laying of pipes up to three feet wide in an area already crisscrossed by other utility lines and busy streets.

"We recognize this will be difficult. People obviously aren't going to like their streets dug up anymore than they already are," Rezachek said. "But we feel the positive benefits far outweigh the temporary impacts."

Honolulu Seawater is putting together a map of utility lines in the area that will be part of a detailed project plan and environmental impact study for permitting applications.

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