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Gathering Place
Cynthia Thielen |
Renewable energy co-ops
give power to the peopleLike a dinosaur emerging from the tar pits, we in Hawaii are slowly climbing out of our oil-based dependency on fossil fuel. Blessed with natural energy sources, it is timely and appropriate to use our renewable resources to power our islands.
House Bill 1692, which is moving through the Legislature, will facilitate this transition. It provides for the organization of renewable energy cooperatives to generate, transmit and sell electricity generated by renewable resources to co-op members. These resources include wind, wave, solar, photovoltaic, thermal, biomass, geothermal, waste incineration, landfill gas and hydropower.
Currently Hawaii law permits agricultural, consumer and housing co-ops. Addition of renewable energy co-ops to this list will allow individuals in Hawaii to form cooperatives to generate renewable electricity, which will yield economic benefits, especially for Hawaii's rural communities, and keep our environment healthy.
The electricity co-op concept is successfully practiced on the mainland. These co-ops are private, independent electric utility businesses comprised of autonomous groups of people united to meet their common energy needs through a democratically controlled enterprise. Such co-ops now operate in 47 states, serving 36 million Americans. They provide at-cost electricity to their members, delivering approximately 10 percent of the total kilowatt-hours sold in the United States and generating 5 percent of domestically produced electricity.
These co-ops contribute significantly to our national economy. They own assets worth $76 billion, employ nearly 60,000 people and paid more than $707 million last year in state and local taxes.
Electric co-op development in Hawaii will improve on the national model by adding the requirement that co-ops generate a minimum of 75 percent of their electricity from renewable energy sources. Initial development of the co-ops will be facilitated by their access to significant, competitive national financing. Such low-cost financing is available to electric co-ops through many sources, including the Cooperative Financing Corporation and the U.S. Department of Agriculture Rural Utility Services.
In Hawaii, we are dependent on imported oil for 78 percent of our electricity and on imported coal for an additional 15 percent. Between $2 billion and $3 billion goes out of the country every year to fuel our economy; 70.5 percent of our crude oil is imported from foreign countries, and the remaining 29.5 percent is imported from the mainland. Much of the money that leaves Hawaii to purchase this energy could, instead, contribute directly to our economy and create good jobs, if we were to invest it in local renewable energy generation.
HB1692 will promote the evolution away from the ecologically hazardous and econo- mically precarious reliance on fossil fuels. It will move us toward an independent, sustainable future in which energy investment will contribute to, rather than flow out of, our local economy.
The unique nature of electric co-ops will ensure that members receive electricity at reasonable rates. Because of their nonprofit status, co-ops are exempt from federal taxes (though they will pay local and state taxes). They also will be free from the pressure to earn a rate-of-return for shareholder investors, unlike private for-profit electric companies. Thus rates will stay low and money will remain within the community. The members also will benefit from local generation and distribution, which will create jobs while reflecting the practical energy needs and philosophical perspective of the community.
The development of renewable energy co-ops in Hawaii will contribute to the localization of the energy industry. This is tremendously exciting because clean technologies, appropriate for development in Hawaii, are emerging as a multibillion-dollar growth sector that will create investment opportunities and jobs, helping to ensure Hawaii's economically dynamic and environmentally sustainable future.
Cynthia Thielen is the assistant Republican floor leader in the state House. She represents the 50th District, Kailua-Kaneohe Bay.
