Hilo Coast Power
to close Nov. 30Fifteen employees will lose
their jobs after HELCO starts
relying on its own generator
PEPEEKEO, Hawaii » After producing electricity for more than 30 years, the Hilo Coast Power Co. will cease to operate when its contract with the Hawaii Electric Light Co. expires on Nov. 30.
Installing 40 megawatts of its own power in Kona, HELCO will no longer need to buy the 22 megawatts it gets from the C. Brewer & Co. subsidiary 11 miles north of Hilo, said HELCO President Warren Lee.
HELCO informed Hilo Coast of its decision not to renew its present five-year contract on May 30, Lee said.
The Hilo Coast plant's 15 employees will be laid off, and the equipment will be dismantled and sold, said Kent Lucien, one of C. Brewer's two chief executive officers.
"I wish it weren't so. Quite frankly, it took me by surprise they made that decision," Lucien said. "Our unit is one of the most reliable in the system."
The shutdown is part of two trends: the end of the sugar industry and the tremendous growth of West Hawaii.
Hilo Coast Processing Co. used to burn leftover sugar cane fiber, called bagasse. But the company changed its name and switched to coal when sugar production ended in 1994.
While sugar went down, West Hawaii boomed. East Hawaii has 85 percent of the Big Island's electrical production capacity, but West Hawaii has 55 percent of the electrical demand, Lee said.
Up to 12 percent of East Hawaii electricity that is pumped to Kona gets lost in the process, he said.
But Hilo Coast sells its power at just 85 percent of the cost that HELCO would pay to produce the same power, Lucien said. So the power loss and the discount should balance out.
Tipping the scale away from Hilo Coast is the result of an agreement with HELCO's environmentally oriented Kona opponents last year, ending years of court challenges to HELCO's 56-megawatt expansion at Keahole, North Kona. The company had tried to build there since 1992.
Installation of 40 of the 56 megawatts and completion of a sound-reduction building around the power plant should be completed by the end of the year, Lee said.
Back at Hilo Coast, the company leaves behind a 10-acre pile of waste coal ash. Despite the grubby sounding name, the stuff is fairly white, like sand, Lucien said.
"You'd think you were up on a sand dune. It's very benign material. It's just bulky," he said.
The coal ash provides aeration when plowed into soil, and an agricultural company has already agreed to use the area as an agricultural park as soon as permits are obtained, he said.