Ormat reports Q2 2020 financial results

OrmatThe parent company of Puna Geothermal Venture (PGV), Ormat Technologies released its financial results for the second quarter of 2020 with additional details on its business in an investor call. Reportedly, Ormat made significant progress to bring the Puna geothermal power plant on Hawaii online. Ormat’s updates on PGV during the investor call include the following:

PGV’s recent developments:

TNG Energy Services recently assisted with installing a new wellhead, centralizer, and pack-off at Puna Geothermal Venture.

As of August 2020, Ormat continue its efforts to recommission its Puna power plant. The Company obtained all necessary permits to start operation, completed the construction of the substation and connected a new production well to the power plant. We expect to resume commercial operation during the fourth quarter with gradual increase of generation to 29MW by the end of the year, subject to on time completion of the transmission line by HELCO and additional field recovery work.

The construction of the substation was completed by Ormat with the local utility HELCO as offtaker now having to complete their part for the grid connection, which is expected in Q3 2020. The drilling of two production wells was completed, while one well blocked after flow test, one is a successful well. Cleanout and drilling of new wells continues.

Initial power generation is now expected to begin in Q4 2020 with gradual operation of 29 MW by the end of the year, all under the assumption that transmission line upgrades and field recovery is successfully achieved.

Financial Highlight Regarding PGV:

… The Company recorded business interruption insurance income of $3.3 million related to the 2018 volcanic eruption in Hawaii, which netted to zero Puna’s cost of revenues and reduced general and administrative costs by $0.6 million; In the second quarter 2019, the Company recorded business interruption insurance income of $6.8 million that resulted in a positive gross margin of $1.8 million.

Comments by CEO Doron Blachar:

This was another solid quarter of strong execution led by the improved profitably of our Electricity segment. I am extremely proud of how our team is operating through the challenging COVID-19 environment and how we were able to successfully complete the enhancement of our 19MW Steamboat Hills complex on time and make significant progress to bring Puna back online by the end of the year.

Ormat reports Q2 2020 financial results and improved profitability for electricity segment
August 6, 2020, by Alexander Richter, ThinkGeoEnergy
https://www.thinkgeoenergy.com/ormat-reports-q2-2020-financial-results-and-improved-profitability-for-electricity-segment/

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HECo’s Earnings for 2nd Quarter of 2020

HECo logo Hawaiian Electric From HECo’s earnings conference call:

Last month, the commission approved our application to rebuild the Puna Geothermal Venture, or PGV, transmission line. This will allow us to bring PGV back on to our system under the existing PPA, while awaiting approval of our amended PPA.

“Hawaiian Electric Industries Inc (HE) Q2 2020 Earnings Call Transcript”
August 7, 2020, By Motley Fool Transcribers, The Motley Fool
https://www.fool.com/earnings/call-transcripts/2020/08/07/hawaiian-electric-industries-inc-he-q2-2020-earnin.aspx

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Scientific Observation Hole

scientific observation hole
3/25/91 Liz bagging drilling fragments from SOH #2.

As part of our efforts to disseminate legacy data and preserve the history of geothermal energy in Hawaii, we made an information page about the Scientific Observation Hole (SOH):

A geothermal experiment proved that the Kilauea East Rift Zone held geothermal potential. From 1990 to 1991, the Scientific Observation Hole (SOH) program operated three geothermal test wells in Puna, Hawaii. The data showed that a ten-mile interval along the Kilauea East Rift Zone held favorable high temperatures.

This page contains a brief history of SOH and links to relevant reports and data.

Scientific Observation Hole
http://www.higp.hawaii.edu/hggrc/projects/geothermal-digital-collection/geothermal-collections/geothermal-topic-guides/geothermal-projects/scientific-observation-hole/

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Diversifying Hawaii’s Economy

Kayte Jones, the author of the commentary

Hawaii local Kayte Jones suggests developing the local geothermal energy industry as a way to invest in our own communities, residents, and industries.

We should continue to attract tourists and profit from it, but we should not be completely dependent on it. It’s time to shift our focus. Don’t we have more to offer than the exploitation of our land, people and culture? Couldn’t we be a model of sustainability for the future through research of our unique ecosystem and climate? Through developments in agriculture and green energy like solar power, wind power, algae farms and geothermal energy? Couldn’t we be an educational destination through investment and development into our university system?

From Civil Beat: Manini Beach Park at Kealakekua Bay on the Kona side of Hawaii island. The Big Island lacks the infrastructure of Oahu, even though it needs help.

Hawaii’s climate also creates a unique opportunity for our state to be a model of sustainability via research and development into sustainable sources of energy, such as solar power, wind farms, geothermal and algae farms. The University of Hawaii is a land-, sea- and space- grant institution recognized as a research university. Investing in research and education can make Hawaii an educational destination.

Hawaii’s Unhealthy Relationship With Tourism
July 24, 2020, Kayte Jones, Civil Beat
https://www.civilbeat.org/2020/07/hawaiis-unhealthy-relationship-with-tourism/

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PGV reboot delayed again

OrmatCommercial operations at Puna Geothermal Venture are expected to begin in the fourth quarter, said parent company Ormat Technologies Inc. on Monday as part of a first-quarter earnings update.

Hawaii’s only geothermal power plant was isolated by lava during the 2018 eruption of Kilauea volcano, when lava destroyed a substation and covered a few geothermal wells, as well as cut off road access to the facility.

PGV officials hoped the plant would be operational by the end of 2019 and could sell electricity early in 2020, but the facility experienced some equipment problems when attempting to come back online, and the startup was postponed.

During an earnings call Monday, Ormat CEO Isaac Angel said permits required for the construction and operation of the substation were received.

Two production wells also were drilled. While one was blocked after its flow test, Angel said the second is ready to be connected to the power plant and is expected to enable partial production as soon as transmission lines are rebuilt.

Hawaiian Electric is seeking to reconstruct two segments of its 69-kilovolt overhead transmission lines that are approximately 1 mile long and 1.5 miles long, according to the application filed with the state Public Utilities Commission in June 2019.

The matter is still before the PUC.

Additional field recovery work, such as cleaning out existing wells and drilling new ones, is continuing, Angel said.

“Currently, we expect (a) gradual increase of production to 29 megawatts by the end of the year, assuming all permits are received, transmission network upgrade is completed and field recovery (is) successfully achieved.”

Angel said, too, that all insurers accepted and started paying for the cost to rebuild the destroyed substation, while only some of Ormat’s many insurers are paying for business interruption coverage.

As of March 31, the company had received $27.8 million from its insurance providers for property damage and business interruption.

One insurer, however, rejected Ormat’s claim for business interruption coverage, and the company filed suit against that insurer.

Ormat contends the suit won’t impact its plans for restarting the Puna facility.

PGV reboot delayed again
By Stephanie Salmons, Hawaii Tribune-Herald, Wednesday, May 13, 2020

PGV reboot delayed again

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Ingrid Suter’s Senior Thesis

Student Ingrid SuterOur student Ingrid Suter will be presenting her senior thesis tomorrow, Thursday, May 14, 11 am, online via Zoom. For non-UH viewers, email earth-dept@soest.hawaii.edu for access to this presentation.

Title: Geoelectric data acquisition and modeling of dynamic hydrogeologic systems in Hawai‘i

Abstract: Dynamic hydrogeologic systems were studied in Hawai‘i on the islands of O‘ahu and Kaua‘i. The dynamic systems studied include a coastal salt making pond on the Island of Kaua‘i, a leeward stream valley on the Island of O‘ahu, and the possibility of contamination in a basalt ridge/sediment valley interface. My objective has been to investigate these systems by the use of self-potential (SP) time series, 3D electrical resistivity tomography (ERT), and numerical modeling of electric resistivity in a model of contamination in a valley ridge. The combined research demonstrates how geoelectric data acquisition and modeling can be interwoven to help answer questions individual methods could not answer on their own.

About Ingrid: An undergraduate Earth Sciences student, Ingrid has been helping HGGRC with groundwater chemistry research. She has been collecting rain samples from valleys on Oahu, sometimes hiking on steep terrain, and preparing lab supplies.

Ingrid, thanks for your contributions to HGGRC, and congratulations on your senior thesis!

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TNG Energy Services at Puna Geothermal Venture

geothermal wellhead
Photo credit: TNG Energy Services

A geothermal industrial service company, TNG Energy Services recently assisted with installing equipment at Puna Geothermal Venture: “We recently helped install a new wellhead, centralizer, and pack-off on a geothermal well in Hawaii.” 

Photo credit: TNG Energy Services

Based in Bakersfield, California, TNG Energy Services provides geothermal products and services for industry.

 

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2018 Kilauea Eruption at the 2020 GRC Meeting

geothermal resources council meeting linkedin kilauea eruption 2018This year’s GRC Annual Meeting is planning a special session on the 2018 Kīlauea, Hawai’i Volcano eruption. We got this news from Patrick Walsh, an Ormat vice president for geothermal resource and GRC board member. The 2020 Geothermal Resources Council Annual Meeting is scheduled for October 18-21 in Reno, Nevada (subject to change due to the coronavirus).

https://reno2020.mygeoenergynow.org/about

Kilauea 2018 eruption lava flow

Geothermal Resources Council Logo GRC

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PGV restart pushed back to second half of 2020

Ormat Technologies Inc. is continuing its efforts to resume operation of Puna Geothermal Venture, company leaders said Wednesday during a fourth-quarter and 2019 year-end earnings update.

Isaac Angel, CEO of Ormat, the company that owns PGV, said the Puna plant is expected to restart operations in the second half of 2020, “due to a delay in a building permit that was received just last week.”

PGV, the state’s only geothermal power plant, was isolated by lava during the 2018 eruption of Kilauea volcano, when lava destroyed a substation and covered a few geothermal wells, as well as cut off road access to the plant.

PGV officials had hoped the plant would be operational by the end of 2019 and could sell electricity early in 2020, but the plant experienced some equipment problems when attempting to come back online, and the startup was postponed.

OrmatAccording to a presentation posted on Ormat’s website, permits that have been required for the construction and operation of the substation were recently obtained.

Initial testing is expected to occur during the second quarter of the year. The company hopes the plant will be operating at full capacity by the third quarter, assuming all other permits are received, ongoing efforts to upgrade overhead transmission lines are completed, and the field recovery is successful.

HELCO, which is transitioning to the name Hawaiian Electric, is seeking to reconstruct two segments of its 69-kilovolt transmission line that are approximately 1 mile long and 1.5 miles long, according to the application filed with the state Public Utilities Commission in June 2019.

The matter is still before the PUC.

Additionally, all property insurers have accepted Ormat’s claims and are paying the cost to rebuild items damaged in the eruption, including the substation, according to Wednesday’s presentation.

Certain insurers, however, have rejected claims for business interruption coverage, and Ormat has filed suit against those insurers.

Ormat contends that these suits won’t impact plans to restart PGV.

As of Dec. 31, 2019, Ormat’s total insurance claim was $68 million, of which the company has received $21.2 million.

PGV restart pushed back to second half of 2020
Thursday, February 27, 2020, by Stephanie Salmons, Hawaii Tribune-Herald
https://www.westhawaiitoday.com/2020/02/27/hawaii-news/pgv-restart-pushed-back-to-second-half-of-2020/

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Energy Week 2020 at Kyushu University

Nicole Lautze at Energy Week 2020, Kyushu UniversityOur director Nicole Lautze participated in an energy symposium at Kyushu University. An invited speaker, Nicole presented “Overview of Geothermal in Hawaii” and contributed to the discussion “Sustainable Energy Visions for Asia-Pacific” at Energy Week 2020, Q-PIT Annual Symposium.

Energy Week, an annual conference, focuses on “future energy” and features workshops, symposia, lectures from energy researchers, as well as public events that attract experts from academia, industry and government. The five-day conference promotes sustainable energy research.

Energy Week 2020, Q-PIT Annual Symposium, took place in January 2020 at Fukuoka, Japan.

Nicole Lautze Energy Week 2020 Kyushu University

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HELCo’s Reports about Puna Geothermal Venture’s Efforts to Go Back Online

Ormat logo Puna Geothermal VentureThe Hawaii Electric Light Co. (HELCo) has been writing quarterly reports with updates on Puna Geothermal Venture’s (PGV) efforts to go back online. Since June 2019, HELCo has been submitting them to the Hawaii State Public Utilities Commission (PUC), and the reports described the statuses of the following:

  • Permits necessary for operation
  • Negotiations for a restated purchase power agreement
  • Rebuilding transmission lines and the Pohoiki switching station
  • HELCo logo Hawaii Electric Light CompanyTest energy
  • Community outreach

You can view the quarterly reports at the PUC website.

PUC SENDS RESPONSE LETTER TO HELCO REGARDING HELCO-PGV REBUILD AGREEMENT
Public Utilities Commission, State of Hawaii
https://puc.hawaii.gov/news-release/puc-sends-response-letter-to-helco-regarding-helco-pgv-rebuild-agreement/

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Job Openings at Puna Geothermal Venture

OrmatPuna Geothermal Venture is recruiting to fill these positions:

For more information, go to Ormat’s career site: https://www.ormat.com/en/company/careers/main/

HGGRC is neither affiliated with, nor is funded by, Puna Geothermal Venture (PGV) or Ormat. 

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HELCO seeks OK to rebuild transmission lines to PGV

OrmatA public hearing regarding Hawaii Electric Light Co.’s application to construct portions of overhead transmission lines that will reconnect Puna Geothermal Venture to the HELCO grid will be held next week in Pahoa.

The state Public Utilities Commission will hold the hearing at 6 p.m. Wednesday, Jan. 29, at the Pahoa Neighborhood Facility, 15-3022 Kauhale St.

Statements may also be mailed to the Public Utilities Commission, 465 S.King St., Room 103, Honolulu, Hawaii 96813, or emailed to hawaii.PUC@hawaii.gov. Written statements should reference docket No. 2019-0119.

PGV, the state’s only geothermal power plant, was isolated by lava during the 2018 eruption of Kilauea volcano, when lava destroyed a substation and covered a few geothermal wells, as well as cut off road access to the plant.

Mike Kaleikini

Mike Kaleikini, PGV’s senior director, Hawaii affairs, said the 2018 eruption also covered several of the poles and transmission lines that connected PGV to the grid.

While the application to rebuild was initiated by the utility, Kaleikini said that “in order for PGV to export power and return back to full capacity, these transmission lines are required.”

Under a rebuild agreement between the two entities, HELCO, which is transitioning to the name Hawaiian Electric, will reconstruct two segments of its 69-kilovolt transmission line that are approximately 1-mile-long and 1.5-miles-long, according to the application filed in June 2019.

The utility had requested the application be approved by Oct. 15, 2019.

The docket, however, was suspended by the PUC in August, pending additional information regarding project permits and a renegotiated power purchase agreement between the two companies.

Earlier this month, it was announced that the electric utility was seeking the approval of an amended purchase agreement with PGV that will, among other things, de-link the cost of power from the price of oil.

In a November letter to the PUC, Kaleikini wrote that all permits required to operate the facility remain in effect, and no additional permits are needed to resume operations.

The PUC resumed the docket on Dec. 31.

PGV had previously anticipated returning to operation by the end of 2019, Kaleikini said Wednesday, but it experienced some equipment problems when attempting to come back online, and the startup was postponed.

The target now is sometime in the first quarter of this year, he said.

HELCO seeks OK to rebuild transmission lines to PGV
Thursday, January 23, 2020, by Stephanie Salmons, Hawaii Tribune-Herald
https://www.westhawaiitoday.com/2020/01/23/hawaii-news/helco-seeks-ok-to-rebuild-transmission-lines-to-pgv/

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DLNR’s Geothermal Report to the Hawaii State Legislature

DLNR Hawaii State Department of Land and Natural Resources logoDLNR submitted its report about geothermal development in Hawaii to the Hawaii State Legislature. This yearly report covers the royalties DLNR receives from geothermal energy in Hawaii and the status of developing the interisland cable transmitting geothermal energy. Formally known as the Hawaii State Department of Land and Natural Resources, DLNR manages geothermal development in Hawaii.

More information about the report: https://www.capitol.hawaii.gov/measure_indiv.aspx?billtype=DC&billnumber=63&year=2020

DLNR Geothermal Legislature DLNR Geothermal LegislatureDLNR Geothermal Legislature

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Improved geothermal plant to offer more power at lower cost, PGV says

PGV
Puna Geothermal Venture

A Hawaii island geothermal power plant knocked offline in 2018 by lava from Kilauea aims to produce more electricity and at a lower cost under a new agreement subject to regulatory approval.

Puna Geothermal Venture has agreed to sell electricity from a restored and enlarged plant to Hawaiian Electric at a reduced price that would save a typical residential customer $7.50 to $13 a month a few years from now, according to Hawaiian Electric.

The proposed new power purchase contract was submitted to the state Public Utilities Commission on Dec. 31. Commissioners are tasked with deciding whether to approve the contract as is or with possible changes following a public hearing and input from the state Consumer Advocate.

Under the proposed new contract, PGV would increase its electricity production capacity to 46 megawatts from 38 megawatts. This increase would mean that 68% of electricity on Hawaii island would come from renewable energy sources. That compares with 31% currently and 63% right before PGV was knocked offline.

After the loss of electricity from PGV in May 2018, Hawaiian Electric turned to more production from oil.

PGV has had a contract with Hawaiian Electric since it began operating in 1992, and the geothermal plant in Puna owned by Nevada- based Ormat Technologies Inc. is paid the same price for power that oil-based producers receive. This contract doesn’t expire until 2027, and exists in contrast with renewable-energy producers including solar and wind farms that have been developed in recent years with contracts to sell power at fixed prices typically below the cost of oil-based production.

Last year the PUC suggested to Hawaiian Electric in a letter that an amended power purchase contract competitive with current renewable-energy prices should be part of any resumed PGV operations.

“If PGV does come back online, it should be under circumstances that take advantage of this opportunity to benefit (Hawaii island) ratepayers by lowering the costs of the (power purchase agreement),” the commission’s May 9 letter said.

Ormat had been seeking to expand PGV before the 2018 eruption, and as part of that effort was discussing an amended power purchase contract. But the PUC had some leverage to encourage an amended contract because rebuilding transmission lines to the PGV plant was necessary for PGV to resume energy production, and new transmission lines are subject to a public hearing and PUC approval.

The geothermal plant has long been controversial and opposed by many nearby residents, but PGV anticipates that it can get PUC approval and rebuild its destroyed infrastructure to resume energy production later this year.

As proposed, the amended power purchase contract would take effect in 2022, when upgrades to the plant are done, and run until 2052.

Hawaiian Electric said a typical residential bill should drop by about $7.50 a month starting in 2022 and by almost $13 a month in 2023 under the proposed contract amendment compared with current electricity rates.

Currently, a monthly bill for a typical Hawaii island customer using 500 kilowatt-hours of electricity is about $182. Hawaiian Electric has to pay PGV about 16 cents per kilowatt-hour of electricity under its current contract, and this would drop to between 11 and 13 cents depending on volume under the proposed new contract.

“We thank our regulators for the opportunity to revisit the agreement and find solutions that will reduce customer bills,” Sharon Suzuki, president of Hawaiian Electric’s Hawaii island utility subsidiary, said in a statement. “The pricing of renewables has dropped significantly in recent years. The owners of PGV recognize that and we appreciate their willingness to sit down and work with us on an amended contract that benefits customers and accelerates our transition to 100 percent renewable energy.”

Isaac Angel, chief executive of Ormat, said in a statement that the company is proud to partner with Hawaiian Electric and further clean energy production that reduces greenhouse gas emissions.

Hawaiian Electric said the additional 8 megawatts of power proposed by PGV would reduce the need to burn about 160 million gallons of oil over the life of the amended contract.

Improved geothermal plant to offer more power at lower cost, PGV says
January 4, 2020, by Andrew Gomes, Honolulu Star-Advertiser
https://www.staradvertiser.com/2020/01/04/hawaii-news/improved-geothermal-plant-to-offer-more-power-at-lower-cost-pgv-says/?HSA=fe6edf2024d595ac1cead6fdf0dd51c242ba4537

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Hawaiian Electric, Puna Geothermal Venture reach new agreement to reduce cost, expand output

PGV Puna Geothermal Venture
Puna Geothermal Venture

Hawaiian Electric and Puna Geothermal Venture (PGV) have reached agreement on an amended contract that will significantly lower electric bills on Hawaii Island, reduce greenhouse gas emissions and expand the island’s renewable portfolio standard to nearly 70 percent.

The amended power purchase agreement was filed with the Public Utilities Commission (PUC) on Dec. 31, 2019 for its review and approval.

An added benefit of the new contract is the upgrade of the 38-megawatt geothermal facility to produce an additional 8 megawatts of firm, lower-cost renewable energy, further reducing bills and the use of fossil fuels to generate electricity.

Once the upgrade is completed, typical residential bills are expected to drop about $7.50 a month starting in 2022 and close to $13 a month in 2023, based on current prices.

An important element of the amended contract is that the rate paid by the utility to PGV will be fixed and no longer be linked to the price of oil. By eliminating the volatility of oil prices from the rate paid to PGV, the new fixed-price contract will ensure that bills are more stable. This new pricing arrangement follows guidance provided by the PUC.

“We thank our regulators for the opportunity to revisit the agreement and find solutions that will reduce customer bills,” said Sharon Suzuki, president of Hawaiian Electric’s Maui County and Hawaii Island utilities. “The pricing of renewables has dropped significantly in recent years. The owners of PGV recognize that and we appreciate their willingness to sit down and work with us on an amended contract that benefits customers and accelerates our transition to 100 percent renewable energy.”

The PGV facility in Puna, which began operations in 1992, has been shut down since the eruption of the Kilauea Volcano in May 2018. Currently, power production from oil-fired generators has been expanded to make up for the loss of the PGV facility.

In June 2019, Hawaiian Electric’s subsidiary, Hawaii Electric Light, filed an application with the PUC to rebuild two transmission lines that would reconnect PGV to the grid. In August 2019, the commission suspended the proceeding and gave PGV and the utility until Dec. 31 to provide information regarding an amended agreement.

Assuming the transmission line construction is approved and other repairs are completed on schedule, PGV expects to resume operations in 2020. The loss of PGV has increased electric bills by about $2 a month.

“We have enjoyed a long and successful relationship with Hawaiian Electric and Hawaii Electric Light and are grateful for its support of geothermal power,” said Isaac Angel, chief executive of Ormat Technologies, Inc., the owner of PGV. “We are proud to partner with Hawaiian Electric and enable Hawaii’s commitment to clean energy and reducing greenhouse gas emissions. As Hawaii continues to pursue the goal of achieving 100 percent of its electricity generation from renewable sources, PGV is an increasingly critical source of renewable energy and capacity, unaffected by volatile fossil fuel pricing, in this region.”

All of the repairs, including rebuilding the transmission lines and the switching station that ties PGV into the grid, are being done at no cost to utility customers.

The existing contract between Hawaiian Electric and PGV expires in 2027 and remains in place until it is succeeded by the amended contract when the upgrade is completed in 2022. The proposed amended contract would expire in 2052.

Until the eruption, Hawaii Island led the state in renewable energy production. If the amended contract is approved, once the additional 8 megawatts of firm power come online Hawaii Island’s renewable energy total will be close to 70 percent.

The plant’s additional production will also displace about 160 million gallons of oil over the life of the contract, significantly reducing greenhouse gas emissions.

Hawaiian Electric, Puna Geothermal Venture reach new agreement to reduce cost, expand output
Hawaii Electric Light Company, January 3, 2020
https://www.hawaiielectriclight.com/hawaiian-electric-puna-geothermal-venture-reach-new-agreement-to-reduce-cost-expand-output

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HELCO seeks new power agreement with PGV

Sharon Suzuki

Hawaii Electric Light Co. is seeking approval of an amended power purchase agreement with Puna Geothermal Venture, according to documents filed Tuesday with the state Public Utilities Commission.

“Among other benefits, the amended and restated PPA is expected to result in significant cost savings for Hawaii Electric Light’s customers,” according to the filing.

“We’re thankful to our regulators for the opportunity to revisit the agreement and find solutions that ultimately lower customer bills,” Sharon Suzuki, president, Maui County and Hawaii Island Utilities, said in a Hawaiian Electric news release. “The pricing of renewables has dropped significantly in recent years. The owners of PGV recognize that, so we appreciate their willingness to sit down and work with us on an amended contract that benefits customers and accelerates our transition to 100% renewable energy.”

HELCO asked that the PUC approve the PPA early this year, stating in the filing it would provide “significant benefits,” including lower bills for customers, a reduction in the use of fossil fuels, and a “reduction in customers’ exposure to fossil fuel price volatility,” among others.

Under the new agreement, the rate paid by the utility to PGV will be fixed and no longer linked to the price of oil.

By eliminating the volatility of oil prices from the rate paid to PGV, the new fixed-price contract will ensure that bills are more stable, the news release stated. This new pricing arrangement follows guidance provided by the PUC.

Mike Kaleikini, PGV’s senior director, Hawaii affairs, told the Tribune-Herald in May that PGV was interested in de-linking the cost of power from oil to provide more certainty about its revenue, and that the parties entered those talks before the 2018 eruption of Kilauea volcano began.

The state’s only geothermal power plant was isolated by lava during the eruption. Lava destroyed a substation and covered a few geothermal wells, as well as cut off road access to the plant. It was otherwise spared significant damage in the eruption that began May 3, 2018, in lower Puna.

PGV officials said recently they hoped the plant would be operational by the end of 2019 and could sell electricity early in 2020.

Under the existing power purchase agreement, PGV provides HELCO with up to 38 megawatts of energy and capacity, the filing states.

As part of the amended agreement, PGV has agreed to modify its current facility to provide an additional eight megawatts of energy and firm capacity, which will further reduce bills and the use of fossil fuels to generate electricity.

Once the upgrade is complete, residential bills are expected to drop about $7.50 a month starting in 2022 and close to $13 a month in 2023, according to the news release.

“We have enjoyed a long and successful relationship with Hawaiian Electric and Hawaii Electric Light and are grateful for its support of geothermal power,” Isaac Angel, chief executive of Ormat Technologies Inc., the owner of PGV, said in the release. “We are proud to partner with Hawaiian Electric and enable Hawaii’s commitment to clean energy and reducing greenhouse gas emissions. As Hawaii continues to pursue the goal of achieving 100 percent of its electricity generation from renewable sources, PGV is an increasingly critical source of renewable energy and capacity, unaffected by volatile fossil fuel pricing, in this region.”

The existing agreement expires in 2027 and will remain in place until it is succeeded by the amended agreement when PGV’s upgrade is complete in 2022.

The amended and restated PPA would expire Dec. 31, 2052.

A phone call to Kaleikini was not immediately returned Thursday.

HELCO seeks new power agreement with PGV
By Stephanie Salmons, Friday, January 3, 2020, Hawaii Tribune-Herald
https://www.hawaiitribune-herald.com/2020/01/03/hawaii-news/helco-seeks-new-power-agreement-with-pgv/

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Hawaii geothermal company almost done with volcano repairs

Puna Geothermal Venture pgvPuna Geothermal Venture hopes to finish reconstruction of its facility this year after the eruption of a Hawaii volcano shut down its operation, the company said.

The power production company on the Big Island hopes to be ready to sell electricity in early 2020, The Hawaii Tribune-Herald reported Thursday.

The company is attempting to resume normal operations after wells were isolated or covered by lava in the Kilauea volcano eruption that began in May 2018 and destroyed more than 700 homes in lower Puna.

Lava destroyed the company’s substation and covered geothermal wells, while cutting off road access to the state’s only geothermal power plant. The company began drilling a new production well in October.

Mike Kaleikini, the company’s senior director of Hawaii affairs, said Tuesday that returning to operations means having the ability to generate electricity and transport it to the grid operated by Hawaii Electric Light Co.

A power purchase agreement between the companies is under negotiation, Kaleikini said.

“We’re looking for sure next year. The earlier the better,” Kaleikini said. He added that the timeline depends on various factors and that permitting can be challenging.

The company received a permit allowing an access road and ground work for a new electrical substation, but is still working to obtain a building permit, Kaleikini said.

The company has a connection allowing the plant to export power, but full capacity cannot be restored until the substation is built, he said.

Hawaii geothermal company almost done with volcano repairs
By Associated Press via Hawaii News Now, Dec. 27, 2019
https://www.hawaiinewsnow.com/2019/12/27/hawaii-geothermal-company-almost-done-with-volcano-repairs/

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PGV reconstruction efforts on schedule to be finished by end of 2019

Puna Geothermal Venture PGVPuna Geothermal Venture is expecting to return to operation by the end of this year and hopes to sell electricity in early 2020.

The state’s only geothermal power plant was isolated by lava during the 2018 eruption of Kilauea volcano, when lava destroyed a substation and covered a few geothermal wells, as well as cut off road access to the plant. It was otherwise spared significant damage in the eruption that began May 3, 2018, in lower Puna.

“The restart and reconstruction efforts of Puna are on schedule, and we expect our refurbishment activities will be completed by the end of the year, enabling us to deliver energy from the plant on the temporary lines that help support the power plant,” said Isaac Angel, CEO of PGV parent company Ormat Technologies, during a 2019 third-quarter earnings call in November. “We expect to be able to sell electricity produced at Puna as soon as the relevant permits required from the local authorities for the operation of the substation and transmission network pathways being undertaken by our partners at Hawaii Electric Light Company are received. These are expected by the end of Q1 2020.”

Mike Kaleikini, senior director, Hawaii affairs, said in a phone call Tuesday that returning to operation means having the ability to generate electricity and transport it to the HELCO grid.

This is the “test period, and then in the future, when the substation is built and the transmission lines (are built), then we anticipate being able to sell power to HELCO.”

Although the timeline depends on a number of factors, Kaleikini said “we’re looking for sure next year. The earlier the better,” although permitting can be a challenge.

According to Kaleikini, PGV received a grading permit which allowed the company to build an access road and do ground work for a new electrical substation but is going through the county permitting process for a building permit for the substation.

While PGV has a service connection that would allow the plant to export some power, the plant can’t return to full capacity until the substation is built, he said.

Kaleikini said PGV has so far restored several geothermal wells and repaired several electrical generating units.

Of PGV’s 11 geothermal wells, three were covered during the eruption, along with two groundwater wells, Kaleikini said. One of the covered wells has been uncovered.

The geothermal plant also drilled one new water well and is almost done with a second, backup water well, and it repaired two injection wells and one production well that were not covered by lava.

PGV began drilling a new production well in October, and Kaleikini said that well is expected to be completed some time in the first quarter of 2020.

According to a PowerPoint presentation that accompanied the earnings call, expected capital expenditures for well repairs and new drilling are expected to cost between $30 million and $50 million.

Ormat, however, expects proceeds from Control of Wells insurance to recover part of this investment.

“We maintained coverage for property and business interruptions in Hawaii provided by a consortium of insurers,” Angel said during the November earnings call. “All of the insurers have now started paying the costs to rebuild the damaged power plant equipment. However, certain insurers rejected our claim for business interruption coverage, and we have filed a lawsuit against those insurers. These lawsuits will not impact our plans for restarting the Puna facility.”

As of Sept. 30, the total claim for losses is $56.7 million, and Ormat has received $21.2 million, according to the presentation.

A docket from Hawaii Electric Light Co. — with the application for the construction of overhead transmission lines that will reconnect PGV to the HELCO grid — was suspended by the state Public Utilities Commission in August, pending additional information regarding project permits and a renegotiated power purchase agreement between the two companies.

HELCO was in negotiations with PGV regarding a possible amended and restated power purchase agreement that would, among other things, de-link the cost of power from the price of oil.

Kaleikini said the power purchase agreement between HELCO and PGV is still under negotiation.

“We are hopeful the suspended docket will be reopened by the end of the year … ,” he said.

PGV reconstruction efforts on schedule to be finished by end of 2019
By STEPHANIE SALMONS Hawaii Tribune-Herald | Thursday, December 26, 2019, 12:05 a.m.
https://www.hawaiitribune-herald.com/2019/12/26/hawaii-news/pgv-reconstruction-efforts-on-schedule-to-be-finished-by-end-of-2019/

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Job Opportunity: DLNR Mineral Resources Specialist

DLNR Hawaii State Department of Land and Natural Resources logoThe Hawaii State Department of Land and Natural Resources is looking for a Mineral Resources Specialist.

Job description: “This position is responsible for serving as planner-in-charge of departmental geothermal resources management activities by conducting studies, performing analyses, preparing plans and coordinating activities related to the proper management of geothermal resources and development of geothermal energy in Hawaii. Performs other duties as assigned.”

For more information, please click on the link for the job ad: https://www.governmentjobs.com/careers/hawaii/jobs/2650150/mineral-resources-specialist?sort=PostingDate%7CDescending&pagetype=transferJobs

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Nicole Tours Red Hill

Red Hill Bulk Fuel Storage Facility Nicole LautzeOur director Nicole Lautze attended a tour of the Red Hill Bulk Fuel Storage Facility. Built in 1943, “Red Hill” is an underground fuel facility for the U.S. military branches. Within basalt rocks, Red Hill’s twenty storage tanks can store millions of gallons of fuel. Since 2006, the U.S. Department of Defense invested over $260 million to modernize the facility and protect nearby groundwater.

Along with Nicole, attendees included Brennon Morioka and David Ma (Dean and Associate Dean of UH College of Engineering) and individuals from the Hawaii State Department of Health, Waianae Community Board, and private consultants.

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Richard Ha Visits HGGRC’s Office

two people at the office
Nicole Lautze and Richard Ha

One of our newest fans, Richard Ha visited our office last week Monday! A lifelong resident of Big Island, Hawaii, the former president of Hamakua Springs Country Farms advocates geothermal energy in Hawaii:

From the point of view of the farmer, we should enable geothermal into the grid. Geothermal costs half as much as oil to produce electricity. And, its cost will stay stable while oil will keep on rising. Geothermal is a proven technology that is environmentally benign—it produces no greenhouse gasses.

Mahalo for your support, Richard!

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Diamond Represents Ike Wai at the SOEST Open House

Diamond Tachera SOEST Open HouseOur graduate student Diamond Tachera (third from the right) shared her groundwater knowledge with the community at the SOEST Open House. Diamond explained the Ike Wai project and hosted activities for kids including building a watershed in a sandbox, stamping, and coloring. Graduate students Trista McKenzie and Brytne Okuhata also participated at the booth.

The SOEST Open House took place on Friday and Saturday, October 25 and 26, at the University of Hawaii at Manoa campus. Every two years, the UH School of Ocean and Earth Science Technology (SOEST) hosts the open house to educate K-12 students and the community.

Diamond Tachera SOEST Open House

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Full Operation of Puna Geothermal by the End of the Second Quarter of 2020

Ormat Technologies, Inc. today announced financial results for the third quarter ended September 30, 2019:

Isaac Angel, Chief Executive Officer commented, “The reconstruction efforts at Puna are on schedule and we expect our refurbishment activities will be completed by the end of the year, enabling us to deliver energy from the plant. All of our insurers have now started paying the costs to rebuild the damaged power plant equipment. However, certain insurers rejected our claim for business interruption coverage, and we have filed a lawsuit against these insurers. These lawsuits will not impact our plans for re-starting the Puna facility, and we expect to be able to sell the electricity produced at Puna as soon as the relevant permits required from local authorities for the operation of the substation and the transmission network upgrades being undertaken by our partners at Hawaii Electric Light Company (HELCO) are received.  These are expected by the end of Q1 2020, and so we expect to be able to bring the power plant back to operation promptly thereafter, and to gradually increase the power plant’s generating capacity as we complete wellfield drilling work, with a target of regaining full operation by the end of the second quarter of 2020.”

“USA, Hawaii: Target of Regaining Full Operation of Puna Geothermal by the End of the Second Quarter of 2020 – Ormat CEO”
Wednesday, November 6, 2019, Geothermal Resources Council
https://geothermalresourcescouncil.blogspot.com/2019/11/usa-hawaii-geothermal.html

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Presentation: Hawaii’s groundwater and geothermal resources: what we do know and don’t know

This Friday, you can learn more about our research: “Hawaii’s groundwater and geothermal resources: what we do know and don’t know” by Dr. Nicole Lautze

Research over the past two decades has yielded some unexpected results from the perspective of Hawaii’s groundwater and geothermal resources. This presentation will discuss what we do know and do not know about both resources in the state, highlighting information obtained from recent projects by the Hawaii Groundwater and Geothermal Resources Center. It will focus, in particular, on a recent statewide geothermal resources assessment. Light refreshments will be served!

Dr. Nicole Lautze

Friday, November 3, 2019, 3:30 pm, POST room 723, University of Hawaii at Manoa campus
Dr. Nicole Lautze, Research Faculty, Hawaii Institute of Geophysics and Planetology, University of Hawaii at Manoa

For the list of Fall 2019 Earth Sciences Seminars and Speakers, please visit: http://go.hawaii.edu/6YG.

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