Hoku signs contract with Idaho Power
Hoku Scientific Inc.
said yesterday it has signed an agreement with Idaho Power Co.
to purchase power for its planned Pocatello, Idaho, polysilicon plant.
The Kapolei-based alternative energy company said it will receive guaranteed amounts of power at an undisclosed fixed and industrial tariff rate for four years beginning in June. After the initial term, the price would revert to the utility's standard tariff rates for large industrial power purchasers.
The guaranteed amount of power is expected to be enough to support 4,000 metric tons of polysilicon production a year, after accounting for reductions in the available power during the summer months, when Hoku plans to reduce operations for routine annual maintenance.
"The cost of electricity is the largest single component of polysilicon production costs for a Siemens-based process such as Hoku's," said Dustin Shindo, chairman and chief executive officer of Hoku. "The negotiated fixed rates are fair and fit well within our projected financial models for our operations."
Hoku also said it has amended its substation construction agreement to increase the planned substation capacity to 82 megawatts of continuous load, which is expected to be sufficient for planned production. The substation facilities are expected to come online in May, with additional facilities being phased in until completion in August.
Shindo said it was important to add additional substation capacity given the company's increase in planned capacity from 3,500 to 4,000 metric tons a year. The plant is set to start commercial shipments in early 2009.
Idaho Power also will provide temporary power, which would be separately invoiced, to enable Hoku's earlier reactor demonstration and initial startup and commissioning activities.