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Helco takes some hits for
By Rod Thompson
proposed standby charge
for electrical power
Star-BulletinHILO -- Hawaii Electric Light Co.'s proposal to charge large customers for the availability of electricity even if they don't use the electricity came under attack last night at a state Public Utilities Commission hearing.
The PUC took comment on Helco's request to raise Big Island electricity rates an average of 9.6 percent.
But much comment focused on the company's proposed "Rider A," which would charge companies that build their own generators instead of buying power from Helco.
Gail Gilman of the Gas Co. said said her company is increasingly approached by customers who want to operate their own generators on liquefied petroleum gas.
Typically, such companies would remain connected to Helco to provide backup power.
Rider A asks such companies to pay $360 per kilowatt per year to be on standby, Gilman noted.
Greg Scott of the University of the Nations in Kona said his school is an example.
By generating its own power, the university will save $30,000 a year, he said.
But the Rider A charge would cost the university $36,000 a year, he said.
Gilman said the $360 per kilowatt charge is so excessive that companies would find it worthwhile to build their own standby power and cut themselves off from Helco completely.
Orville Thompson from the west Hawaii resort ,The Orchid at Mauna Lani, agreed. "The financial incentive to leave the 'grid' would be too great to ignore," he said.
The Orchid's chief engineer, Lance Joaquin, said the resort would save $250,000 a year by generating its own power.
But if organizations like the university and the resort leave Helco entirely, rates on residential customers would have to be raised to pay for Helco's existing power plants, Gilman said..
Helco President Warren Lee said organizations building their own power plants while depending on Helco for backup "want to have their cake and eat it too."
"If you want to be served, we'll serve you, but at a price," he said.
The company determined the $360 per kilowatt price is reasonable, but the PUC may change that, Lee said. "Everything is negotiable," he said.
The average 9.6 percent rate increase -- actually 11.7 percent higher for residential customers -- also drew criticism.
John Stansfield, representing downtown Hilo business owners, said the increase could amount to $40 to $80 a month for small businesses.
"That's a tremendous burden, coming close to putting them out of business," he said.
