Story by Paul Wood
Photos by Olivier Koning
Not far from that ghost forest stands a very different expression of fire meets water and land. This place, Puna Geothermal Venture (PGV), taps volcanic steam and super-hot brine, then converts that fury into electricity. PGV sells its product to the Hawaii Electric Light Company (HELCO), which is the Big Island’s sole distributor of electric power. Volcanic power is now providing about 20 percent of that island’s electrical needs.
Yes, you read that right: Geothermal is underway in the Islands. Many in Hawai‘i remember geothermal’s troubles during the 1980s—community protests and adverse judicial rulings—and assume the industry got snuffed out. Not so. PGV has been generating power since 1993: lying low, building capacity and waiting for geothermal’s new day.
That day may well have arrived. The state, with its Hawai‘i Clean Energy Initiative, has set the goal of 70 percent “clean, locally developed, renewable energy” by the year 2030—and volcanic heat seems destined to play a role.
This steam comes from wells that PGV has drilled here: shafts that wander in every direction in search of heated water. The wells drive down 3,500 to 7,000 feet below sea level seeking water that has percolated through the cracked and porous structure of the volcano and gotten trapped close to deep magma. Full of chlorides, very acidic and reeking of sulphur, this material shoots up at a rate of four thousand gallons per minute, powered by its own intense pressure. PGV’s pipes capture this force, separate the steam from the brine, then use the heat energy of both to spin turbines. These turbines cause electrical generators to turn and from that comes electricity, which travels to the HELCO plant and is then distributed to (for example) hotel rooms in Hilo. The spent steam and brine, meanwhile, return to the earth’s depths via injection wells.
What PGV doesn’t have is a huge smokestack—and that absence is historic because Hawai‘i, though it contains zero natural deposits of fossil fuel, currently depends on oil for a whopping 90 percent of its energy. Last year the Big Island alone spent a billion dollars on oil. Wallace Ishibashi, head of the ILWU Hawai‘i chapter and a longtime proponent of geothermal, asks: “What do you think is our biggest export from Hawai‘i? Bananas? No way. Our biggest export is our own money. That billion dollars we spend on oil, we can keep that here.” Can we?
Mike Kaleikini is the face and the managerial force behind PGV. Built to NFL proportions, the Kamehameha Schools graduate came to the PGV site in 1991 when the trenches were being dug. Today, clad in leather boots, jeans and a striped polo shirt, he serves me a cup of coffee in the PGV offices—minimal plywood structures that look as though you could pick them up with a forklift. In fact, the entire PGV plant is somewhat movable; it is, after all, located in a lava inundation zone. If a flow ever comes, components can be hauled away, wells capped and—if they’re not destroyed by the flow—later recoved via GPS coordinates. If one of the earthquakes that regularly rumbles through the region shears the wells, well, that would be a different story.
Kaleikini tells me what he wants everyone to know. The energy generated at PGV is “firm” or “base load”—that is, Mike explains, it doesn’t fluctuate the way wind, solar and some other forms of renewable power can. PGV is owned by Ormat Technologies Inc., an Israeli company that’s engaged in geothermal development around the world. Ormat helped launch PGV by providing “EPC services”—engineering, procurement and construction—and then bought the plant in 2004.
The first time earth steam was trained to spin a generator and light a few bulbs was in 1904 in northern Italy, in an area the Romans once favored for hot-tubbing. Seven years later the Italians created the first geothermal power plant there in the Valle del Diavolo or Devil’s Valley. The next foray into the technology happened in 1958 in Wairakei, New Zealand. Today geothermal production of electricity is happening around the world. Iceland now taps geothermal for about half of its primary energy needs, and other countries hooked into geo include Mexico, Japan, Indonesia, Costa Rica and Kenya. The United States is in the lead overall followed closely by the Philippines. In fact the Philippine city of Ormoc is producing seven hundred MW of geothermal power, most of which it exports, and Big Island Mayor Billy Kenoi has forged a sister city relationship with Ormoc and recently paid a visit to geothermal plants there.
In Hawai‘i the first drilling for steam began in 1976 with the HPG-A test facility in Puna. Its three-megawatt power plant went online in 1981 as an experimental operation intended to cease after two years. It had no injection wells to return its tapped material to the earth, and its steam releases and stinking sulphur ponds distressed and infuriated area residents. Unfortunately, because the island was so desperate for electricity, the plant kept running—six years longer than intended—while residents built up a lot of steam of their own.
Two facilities followed—PGV and True Geothermal Energy Company. The latter particularly roused public ire for cutting into the rainforest and interfering with traditional gathering rights and cultural practices. Some Native Hawaiian groups argued that the power plants were violating Pele, the fire goddess. When PGV lost control of one of its wells in 1991, the release of toxic and noxious chemicals, including caustic soda and hydrogen sulfide, triggered a lawsuit and eroded political support for geothermal. The fact that the price of oil was down to $25 a barrel didn’t help the cause. But today, with oil at over $100 a barrel and rising, the picture has changed.
For most of its history PGV has provided thirty MW to HELCO through its original thirty-year power purchase agreement. By new agreement PGV recently added eight more megawatts, and it would like to do far more. Its dream is to send electric current through an undersea cable from the volcano to Honolulu, where 75 percent of the state’s population resides. (Hawai‘i’s older islands, such as O‘ahu, are probably too cool to generate their own geothermal juice.) That cable is still conjectural, but lately the State Legislature has been passing bills intended to bring the cable into reality—to create a kind of central nervous system for power in the Islands. Were this cable to be laid, Hawai‘i Island certainly could provide indigenous electricity to O‘ahu. Estimates from the 1980s suggest that the Big Island’s volcanic resource could produce five hundred to seven hundred MW, which is considerably more than the island now uses: Peak demand on the Big Island is less than two hundred MW. O‘ahu requires up to 1,817 MW on any given day—almost none of that now derived from renewable sources.
Outer-island voices, especially on Lana‘i and Moloka‘i, protest against the cable, seeing it as a high-tech way for big-city Honolulu to siphon the rural vitality out of their separate cultures and resources. Meanwhile on the Big Island PGV continues to be challenged at public hearings by area residents. Neighbors aver that the geothermal plant leaks noxious steam and that the drilling of new wells is deafening. The Pele Defense Council, a nonprofit group that effectively resisted geothermal two decades ago, has returned to the fight. Last March the group staged a protest rally in the dripping rain, waving signs in front of the HELCO building in Hilo. “They have never answered the concerns of what the impacts were,” leader Palikapu Dedman told reporters, “all the way to what’s most important for a Hawaiian, which is how it’s sacrilegious toward our beliefs.”
“This island could run on geothermal easily,” says Kahawaiola‘a. “To me geothermal is a no-brainer.” He says that unlike those who see geothermal as a violation of Pele, he sees it as a much-needed gift from the goddess, and these days he prefers a chair at the negotiation table to a protest sign on the road. He has concerns, he says, that exceed the mechanical challenge of safely spinning a steam turbine. “The biggest issue all Hawaiians have is fair compensation,” says Kahawaiola‘a. “That’s the crux for me: fair compensation and tangible results.” An example of tangible results would be reduced electrical bills on an island that gets 20 percent of its current from its own volcano. But as of May of this year the Big Island was paying 41 cents per kilowatt-hour. Maui was at 37.9 cents, O‘ahu at 34.6 cents. The national average as of March of this year was 11.8 cents.
There are reasons, of course, why geothermal energy isn’t free. It’s expensive to create such a plant. In addition, geothermal steam is by law a natural resource owned by the state, so Ormat must pay royalties, 10 percent of profits.
Still, those costs shouldn’t push the Big Island’s electrical costs to almost four times the national average. To understand why Hilo’s bills are so high it helps to understand the way the energy business model has played out in shifting times. Here’s how it’s worked: When a utility company begins purchasing juice from a volcano, it has to start shutting down its oil-fired power plants and dealing with emerging suppliers. The business model shifts radically, but shareholders still want profits. In the late ’90s, Ormat and HELCO were given the state’s blessing to sign a thirty-year power purchase agreement that ties electricity rates on the Big Island to the price of oil until at least 2027. That means, in short, that even if your power is coming from the volcano, you have to buy it at the price of oil—and oil prices are now surging ever upward.
The Public Utilities Commission (PUC), which is the state’s mechanism for regulating island-specific monopolies such as HECO, HELCO and (on Maui) MECO, certainly knows about the price-fixing contracts. PUC Chair Hermina Morita says, “When the geothermal contract was negotiated, it was based on ‘avoided costs,’_ the cost that the utility avoids if they were to generate the power themselves. That was the benchmark used at that time. It was a time when oil was in the basket of $18 to $25 a barrel.” That mode of business is a thing of the past, she says. “As we move forward, the new power-purchase agreements are completely delinked from oil costs.” Also, although the PUC like everyone else, is constrained by laws that protect contracts, “We’ve been gently suggesting that these contracts be renegotiated so that there will be a win-win situation for everybody rather than a windfall,” Morita says. In May of this year HELCO President Jay Ignacio told the Big Island County Council that a percentage of PGV’s original thirty MW and all of its recently added eight MW have been delinked. So will the utility reduce consumer energy costs on the Big Island? The future will tell.
A Native Hawaiian-based investment group called Innovations Development Group (IDG) says it has created a more community-minded business model for developing geothermal in the Islands, one that respects native rights, local investors and a fair sharing of benefits along the lines that Kahawaiola‘a envisions. Attorney Mililani Trask, spokesperson for IDG, says, “We decided we had to take less profit and share with the community. Geothermal energy is a public trust, and we have to find a way to bring this back to the people who own it.” When HELCO put out a request looking for an entity that would develop an additional fifty MW of power derived from a renewable source, IDG was one of the organizations that sent an expression of interest.
Ormat is pushing forward, too. It has met with residents of Kula on Maui to let them know it intends to explore the presence of geothermal heat inside Haleakala. Thus far the trend in the state’s approach to renewable energy development has been to award contracts to large corporations from outside Hawai‘i, corporations whose methods mesh with the practices of Island utility companies. The fate of local entrepreneurs and startup companies with homegenerated ideas remains to be seen. There will undoubtedly be much to watch closely in the coming years as development contracts are awarded and terms are negotiated.
In a democracy, every thorny problem needs at least one levelheaded farmer to think things through. Richard Ha served on the same Geothermal Working Group as Pat, and he too is a believer in geothermal. His thinking on it is Island-based and practical, and in fact Pat and many others regard Ha as the voice and conscience of geothermal, a citizen who has punched through the boundary between today’s energy crisis and tomorrow’s potential.
Ha recently spoke about global petroleum supplies at a TED-style conference in Hilo—stating that humans are now using thirty billion barrels per year but new supplies have fallen to one-third of that amount, that the end of cheap oil is upon us, that we humans are obviously in an unsustainable situation. I assume he wore to the speech the same basic ensemble he was wearing on the day that I met him: shorts, polo shirt and rubber slippers. Ha’s one of the “rubber slipper people,” a phrase of honor he applies to the common folk of the Islands, the ones who will represent the ultimate success or failure of energy policy in Hawai‘i.
Ha runs a six-hundred-acre farm in Pepe‘ekeo, about ten miles north of Hilo. He started thinking about oil when his farmworkers came to him asking for pay advances to buy gas so that they could get to work. His own fuel costs—powering tractors, forklifts, eleven gigantic refrigerators—were just as severe. “I can’t raise my workers’ pay,” he says. “We’re all getting squeezed.”
To find a solution, he made a leap. He attended the Peak Oil Conference in Houston. In his shorts and rubber slippers. What he learned there made him lose sleep. But he’s been four times now and has learned to focus on solutions.
Ha’s farm, on former cane land, is lush and watered by three unfailing streams. He’s working to make it completely self-sustaining, experimenting with hydro-power, cascading fishponds and oil production via farm waste and algae. He serves on the Hawai‘i Clean Energy Initiative Steering Committee. Although he feels a great urgency about the global oil situation, “I’m very optimistic, at least for Hawai‘i—the Big Island for sure.
“We got all this wastefulness we can get away from,” he says. Thinking of the taro-based agriculture of his ancestors, he adds, “In Hawai‘i it’s within people’s memory that these Islands can be sustainable. That’s a huge benefit we have going for us.”