Industry sign banking hawaii iou free
[Music] we want to stock up on someone we have fantastic thanks for your attention if you're a student who wants to get extra credit for being very proud to sign in and if you are not a student but you want to be able to email this well thank you for coming tonight this is a continuation of the whole hope America in crisis series this fall were focusing on climate change because it's very clear that there's nothing more important with the climate change issues and we have tonight very impressive person and I'm just thinking how Marco mangling sort is fabulously perfect for speaking politics science the academic experience and you know just a hands-on work in our island on solar and other renewables so he has the whole expanse of the issues that that are important to climate change and noodles I have a secret hope desire and then that people start taking on the the challenge of creating a Hawaii so uh our political sort is a PhD from the University of California he has taught classes here at irrigation in California on the politics North America Hawaii and Asia so this is we're very honored to have you speechless so thank you very much [Applause] and you guys for coming this evening so my plan is to just a couple more words who I am and what I'm doing I've been in the energy field for 40-plus years but in California and the past 20 here in beautiful my full-time day job is pollinating a small medium small solar energy company provision solar and we've been around since 2000 but I also have this academic track over the years where our top of time the time my development of course taught here you hwc of politics of energy which long time and it's really been fascinating to be a part both be a part of the energy industry here for as long as what happened but also have that academic side which allows me to kind of take a bird's-eye view and in a more analytical framework in terms of looking at the stats looking at the data looking at the trends looking the players in the energy field both here on this island across the islands and in the country and how it kind of all interplay so it's really provided me with a lot of really juicy juicy stuff let me ask you guys this why would you ask to mate to be of all the energy used in the state of Hawaii now after more than 40 years of efforts through Republican and for governor demonstrations there are all these legislators through all these Public Utilities Commission sir forty years of efforts to try to wean ourselves from imported fossil fuels so there's been an emphasis decade after decade to try to become more energy independent right more energy secure so what estin that would you come up with that in this day and age 2019 how energy independent are we versus fossil fuels number one oil products coming in from far away twenty seventy percent independent or dependent so in other words we're two or eighty percent self-generate or kidnap the other way around okay any other guesses yeah this is all energy all energy close it's it's over eighty eighty three percent of all our energy supplies comes from outside this is the island chain and it's very largely very largely free largest petroleum so all these decades of efforts we're still eighty-three percent dependent on imported oil to fuel our economy as in our generation and transportation so all these decades of efforts we still have a long ways to go okay more locally for this island what percentage of all power generation on this island last year came from renewable sources what percentage going I'm sorry prior or after well I mean who did you a thermal what I wonder merely May last year so you have to take that into account on the estimate well you guys are sharp so 43.6% this island was renewable last year for electricity generation of even my electricity generation is power generation not transportation so when you throw in transportation we were a lot less independent for power generation 43.6 the year before 2017 prior to the pioppi of geothermal going offline we were 57% and moving towards 60 + PG be going online big hit fYI PGV wants to come back online they've been spending millions of dollars to come back online right now B there's a big question mark about PC to be coming back online it's not going to happen this year I guarantee you we only have that for two months to go obviously so question mark regarding DTV the big round used to be leading the state and all the violence now with us at 40-plus percent this year's going to be more or less about the same percentage I'm gonna predict we are being surpassed by Kauai y will be well over 50% renewable this year which will for the first time have Kauai and my friends going on utility co-op the number one in the state in terms of power generation okay so that's kind of some of the broad overview strokes by the way so my my plan here is to first talk about energy on this sound specifically to the power generation and then I'm going to shift gears to talk about the Hawaii Island energy co-op hie see where I am a director for that organization as well so that's kind of going to be so if you look at all the power plants on this island not including rooftop solar that rooftop solar or distributed energy resources for short is one afternoon BER or distribute generations the same thing so not including rooftop solar which we have somewhere between eleven and twelve thousand rooftop solar electric systems on the side and to get an idea just kind of on a percentage basis there are about 84,000 health-code customers 84,000 accounts now population being 200,000 that means that for every hELCO account there is X number of people let's say three people four people per health code so 84,000 delgo accounts roughly twelve whereas the eleven twelve thousand of those category pop solar we have one of the highest percentages in this state of people who have solar on their roofs these solar thermal and silver lecture the highest percentage of by far but for the knees higher country and that is something that's a good so winning a side rooftop solar if you look at all the other power generation that is possible here there's about 290 megawatts 290 megawatts total maximum peak output on this side what's the megawatt a megawatt is a million loss so don't get too caught up in them in the megawatts 290 292 Legolas of those 290 the peak to man on this island typically takes place when people come home after after school they start turning on blow electrical loads the peak demand is typically around 180 290 megawatts underneath okay out of all the rooftop solar that has been installed today it is somewhere in the 110 plus megawatt range stove again 290 peak output from all production not including rooftop solar about 185 190 feet to man solar now is going up more than 100 megawatts so we're talking substantial power generation coming from solar and there's gonna be even more coming their morning and to projects that have been green lighted by our Public Utilities Commission for 60 megawatts of utility scale solar plus energy storage ie batteries 60 megawatts 2 times 32 separate plants both on the west side the island the white below area okay 60 megawatts right now as of today there was the closing date of another so-called request for help no miko put out several months ago today's the deadline we're developers from around the country around the world common sake we want to develop another 60 megawatts under 100 megawatts another next megawatts so sometime in May of next year Hawaiian Electric will announced that they have approved I'm going to guess another 61 to 100 megawatts of solar cluster work for this island another 60 to 100 we already have a 100 plus megawatts of rooftop solar they've got under 60 megawatts of already approved utility scale solar and storage coming and here is going to be another 60 100 megawatts you start adding up all these numbers you're talking about real generation right and my point would be is you're adding up all these power plants all this generation there's a big question that the utility operators help them how to ask themselves which is where is all this power can come because there's no such thing as an infinite grid you guys the inverter of this kind of buzz word called a smart grid which means different things to different people but even the smart grid cannot take a limited amount of power generation for more and more and more and more solar or this or that coming in to the grid at the same time applying a grid cannot take an infinite amount of power so with all this new power coming online these new projects being proposed and approved by the Commission again where is it all going to go what are you going to do with the existing power plants such as the one of them Chanukah and a hummock blue energy which is the second largest power plant 60 megawatts it is owned by an unregulated subsidiary of Hawaiian Electric Industries is a sister company with hELCO eco miko so you have an HDI company that owns the second biggest power plant on the island of humma cool the largest power plant on the islands nobody hELCO it is right kind of the interest of the K Jolla Airport you see it right there across the highway that's 80 megawatts so as you bring on the horse taller more storage more solar more storage other power plants have to ramp down you cannot have more and more and more and more power in the center so it remains to be seen how about that was going to put above all this together because their number one priority is to have a stable grid life stay long and we are going where few utilities have gone before when it comes to so much renewable energy coming into a finite grid not on the mainland you have the entire main language is interconnected east to west north to south so they don't have the same limitations that we do when our island grids are all self-contained they're gonna be no underwater power cables probably my lifetime it's expensive who's going to pay for it so for the decades to come I do not believe there's going to be a power cable from the Big Island speeding abajo or power cable from Wallach I diffusing a lot or power cable from Maui feedings when I think Molokai and then and welcome that's not going to happen anytime soon for the foreseeable future you have these island grants that are separate that are Islands them to themselves so to speak where you can't continue to have more and more and more and more power so how it's all going to be figured out is it very it's technical and it's also extremely political and we're not at the point where battery storage is cheap enough where you can have so much solar in so much battery storage that you can turn the switch off the hum of the wood energy on a cop turn the switch off the plant and get wholly there is a backbone that what I call spinning generation provides to the grid spinning generation comes from combusting something burning something whether it's oil NASA hydrogen or in the case of the proposed power plant in the kiddo I don't know if many of you have been following that story where there's a 20 plus megawatt plant that for years and years was burning the gap sandwiches the refuse Drummond sugarcane nervous and after cane essentially died them in 1990s the power plant operators shifted to using coal so they were actually burning coal that they can was that he loved those power company for about ten years in 2005 they shut down mainland company passed by their accounting invested two hundred million dollars or more to read the five who gelila the person leading that charge is my friends former colleague Warren Lee who used to be President telco for many many years and I have a little awkward Warren came out more to to be President who only wanted to try to get across the finish line and who all knew like if it were ever to come online which I sure as heck hope it does not if it were to come online it would burn trees but what a lot of people don't know is that the contract between pu'uhonua and Elko does not require who want it to burn only Big Island trees they can bring in biomass from wherever they need you to burn we're going so just to kind of quickly bring you up to speed those of you who think they're following particular issue who won't know was to go online how to received approval from the Public Utilities Commission in 2017 and Henry Curtis many of you probably heard of Henry Curtis life of the land long time Crusader great guy he brought a suit and Hawaii Supreme Court that was decided earlier this year in April and the white Supreme Court ruled unanimously by the nothing that the PUC and 2017 air when it approved the power purchase agreement between Calgary and Villanova because the Commission did not take into account the effect climate change air quality and Environmental Quality so they remanded in a highly unprecedented move they were remanded the decision EUC decisions after the Commission and the Commission is now considering forced by the court reconsidering whether a power plant on our coast that would burn biomass is in the public interest so sometime in the first six months of next year the Commission will issue a decision I'm very very hopeful they will play down to that power plant blessed for all because I have concluded that Al Gore I think who coined the phrase not too long ago or number of years ago you know we have a planetary emergency here and the notion that in on this Islander in the state let alone the rest of the world any new power generation should be combustion based to me is something cannot afford as a specie so at least in our island we are Commission has the opportunity to take a move so it's a question as to what happens with who on a month it's a question mark what happens with Puna geothermal event included geothermal venture reliably without power for 19 1993 to last year roughly 25 years they had a number of hydrogen sulfide releases over the years people who lived in the area were made sick according to their own experiences and I'm not going to challenge them or question whether they were really sick or not and I was relatively accepting a PGP up until May of last year when it's a rather dramatic events happen right in that in Livadia states in the whole lower east rift zone so whether pgb comes back online that's an open question right now and I'm kind of personally kind of conflicted about it because comparatively speaking is better than burning stuff for power generation but at the same time how much senses of make check out geothermal power plant in one of the most seismically active and hot lava zones on the planet so but it's now my Powell anyway ultimately it's going to me it's going to be our public utilities I also talk a little bit about about battery storage because I mean something that Mike what he does you know we're a Tesla energy provider along with the number of others in the state but panasonic is involved because of all four Panasonic LG Big South Korean multi multi company Bhangra Sony there are major American and foreign companies that are developing energy storage I mean we're seeing this revolution but one of the ways that we are going to be able to get further faster and deeper as I say in this state in terms of hearing ourselves in this dangerous addiction to important fossil fuels is to ship transportation to electric vehicles and that's something that the white electric very much wants to see not so much out of the goodness of their own part but because more electricity consumption means more sales and more eby's means more electricity the most important thing is where does the electricity come from how is a generator that goes into our TVs that gets us prepare to come do that right here on the back right so I'm a big favor of electric vehicles in general as long as the power is being produced to charge the batteries is coming from a renewable energy source and I think we got the great potential to be able to do that here in this state but storage is also critically important not just in transportation but also the fact that there are times during 24-hour cycle in the Shyne right most good part of the 24 hours there's no sunshine we have two in Florence on the side but when you make a last down the South Point along the cliffs there and we have a
lot of 10 or 11 megawatts of the copy there are times of the day when it doesn't blow much right so renewables of solar and wind right here called non-firm as opposed to firm power which comes from spinning generation in which you have the confidence is going to be available 24/7 so we're not going to get to a point where the Sun is not shining 24 hours a day I remember a girl in my early years there was talk of putting geosynchronous satellites in space 22,000 miles up that would always be in the Sun and then have those solar arrays produce power and transmit it down to ground receiving stations via microwaves whoa is any living creature that's in right so I don't think that's it didn't go anywhere I don't think it's gonna go anywhere so the way you turn non-firm Renewable into more from power oceans with utilities wants is by having storage right now cost-effective storage for utility scale renewable energy projects typically will give you 4 to 5 hours where the stored energy so once the battery is fully charged then you start discharging it will essentially move out after 4 or 5 hours that is not good enough for empowered that's not good enough to qualify for empower so there needs to continue to be substantial progress made to two things the energy efficiency energy density the battery where you can get more energy into a smaller volume and - it's got to be cost-effective right because if you can do something in the lab where you're causing it to be 10 times more energy dense that's all well and good so the good news is you have all these major players who are really committed to the battery storage evolution revolution but we're not there yes you gotta start somewhere and starting is already started the folks party the the players have already left the starting line in this race and there's a tremendous amount of competition I'm very very optimistic to see the progress will continue to be made there's a lot of a lot of money involved that is going to be a key part of the whole movement towards more and more more renewables not just on our isolated islands but also on a practical matter the solar industry here on this stage which I've been part of like I said for 20 years I'm not sure if I came up with this a number of years ago or whether it ready somewhere but somehow the term solar coast group got into the public discussion and I can tell you my friends I have been writing that Solar coaster and it can be rather harrowing sometime and you look at it from the perspective of let's let's say you're in the tire business okay it stands to reason that if you have a given tire store or outlet your volume is probably going to be pretty steady over the years because people will will need tires right unless you have an Amazon type of company that can just undercut you like crazy trip tires tires are not something that typically ESL FedEx is going to plop down you know I sure it's your front door so there are you know kind of engine good items with their tires refrigerators where there's a fair amount of prediction and stability going on in terms of demands so if your business aren't you can have some confidence and the years to come you're not going to be this in terms of revenue that is the way business or business okay very silver coaster life well as policy driven and this also you know given being the ass of a hand I'd like to try to ferret out why is this happening for crying out loud and there's some reasons I can identify as an analyst that make sense to me and others that this kind of I'm not sure what's going on here but one of the things that is there really important for solar over the the years the decades is that there have been tax credits available both from the federal government and give George W Bush and his administration 2005 credit for increasing a federal tax credit known as the investment tax credit in 2005 to 30% 30% so if you are a federal taxpayer most of the sort and if you buy a solar system the cost of the system can be offset by 30 percent worth of a tax credit money that you don't pay to the federal government so it is a dollar for dollar value so that's obviously quite an incentive the state is also a tax credit of 35 percent for the years so you had a 30 plus 35 you're talking about a substantial incentive to go solar there are those who are not terribly growling the solar or renewables you say the only way they survive is because of the federal support what they fail to say is that there is no such thing as a level playing field when it comes to energy I know something about that I've researched it if you go back over the past 50 60 years and track the different energy sectors petroleum coal NAT gas nuclear renewables you can actually see how the money was spent and how much money was that the conventional fuels oil that gas pull a nuclear way to heck up here in terms of subsidies renewables way the heck down here it's not even close so for anybody to say our renewables they can never make it on their own well there ain't no such thing as a love of money field when it comes to something it's important and politically-connected is energy and by the way it's the same with with food items terms of governments for there's the Americans the Europeans the Japanese supporting the rice producers the corn producers and so forth whenever you have a segment of the economy that generates so much money and has so many big companies and entities behind it you have them going to the government for support so the amount of money again the renewables have received over the years is teeny tiny teeny compared with fossil fuels so one of the important things going on where media my company and the industry right now the solar coaster is enough swing which I'll take anytime any day of the week compared to being announcing one of the reasons is the federal investment tax credits which I mentioned 30 percent that actually starts ramping down two months from now on January 1st it drops the 26% so we're just getting out as been getting out and interestingly it's been shown from a psychological perspective if it's let's say you have an investment portfolio and you're your investment advisor who you who you trust right it's not stuff camera he or she calls you up and says hey Marco i really suggest you sell part of your portfolio because i think it's very likely that your portfolio values when they go down people typically are a lot more motivated to take action out of a fear of loss then there's that same advice because Mabley said oh you I have a deal for you you should invest in XYZ stock because you're making free money yeah what else we talking so the perception or the fear of loss actually is a greater motivator than the other way around so I think part of that is involved in terms of sparking the fairly big year we're having in terms of you know what comes next year I don't know fingers crossed because that's the tax credit again goes to 26% next year the following year in 2021 it drops the 22 percent and then by 2022 of lesser change of legislation in Washington which assumes passed by both houses of Congress is signed by a president by 2022 there will be no tax credit for homeowners to go solar they'll still be 10% for businesses to go solar but nothing as far as the state tax credit goes to the that day but every year it's a move on from five four five six years in the legislature white legislature which means from roughly the mid part of January the early days amazed there have been efforts to change the solar tax credit for four straight years our legislatures be able to do something that to me is would have been really really important really really good which is to create a separate state tax credit that would promote folks who already have solar electric systems of which there were a thousand across the state the vast majority have no storage which means that when the grid goes down whether it's hurricane whether it's Paul gets clipped down the street those solar electric systems they shut down no matter who they spend ten thousand and four eighty thousand if they don't have storage they shut down so this these efforts and past four years but you failed for your strength to get a legend up bill to the governor's desk that would establish a tax credit state tax credit to add storage to renewable energy systems this fail why because of the relative dysfunction in our state legislature in my opinion and personalities people who don't get along we can't play nice together [Music] when you have bills similar bills that pass in one form in the house one form in the Senate they go to something called the conference committee and that's where these particular bills past four years have done okay let me show up to to the the fun story about he's waiting on an article a number of you probably heard the name your energy mixture of energy next here energy is a great big company based in Florida that has a number of utilities in Florida and the southern part of the u.s. under their belts they're definitely one of the major utilities in the in the US and they entered into a deal to buy Hawaiian Electric Industries this is announced back in the December 2014 what Electric Industries is comprised of four different continents telco we go eco American cities Met Ball you have very very very few utility holding companies so next era and the HDI entered into an agreement for next year to buy all of EGR and it went through a year-and-a-half process at our Public Utilities Commission 21 days of hearings in which I attended about half of them at the Blaisdell July of 2016 the PUC or PUC which is three people by the way they're all appointed by the governor and confirmed by the Senate the stakes in it are PUC thumbs down to next arrow this was on a Friday Friday the 15th I think it was and then on Monday open a business on the East Coast tarah announced publicly we're done we're not going to appeal we're out of here they need a 90 million dollar breakup deep in Hawaiian Electric will taxes a Kauai electric made about 60 million of that they headed 60 million and since then Hawaiian Electric nest continue distant whine like a cosmic cow the reason I bring this up is because in 2015 early 2015 as those of us the energy field were digesting this news in early part of the year we got to thinking you know maybe now is the time to see if we can work the magic like the folks on Kauai did in the early 2000s and when what was then Hawaii Electric which is on my East Coast company citizens communications in Delaware when they decided they wanted to sell their utility company on what so they'd say they wanted to sell the winning bidder was a Hui of people who formed in 2000 once you buy the utility company there turned into a kilometer which became quite hot utility co-opted yeah you see they purchased took over and 2002 so QC has been the only electric co-op in this state that is been operating for the past 17 years in my opinion doing a very good job but a number of us would have my friend Richard ha Donna was involved as well Senate you know if there's ever time to try to turn how go into a co-op now's the time to make that kiss now that the ownership of Elko who Kimiko was in play right so we curve petition to the PUC to become an intervener on this dock and Wohlers that means so the Commission establishes a set of proceedings they call a document whether it's a requested rate increase for hELCO or you go amigo or something having to do with telecom or transportation the PUC regulates public utilities whether it's power communication transportation and water so they open the docket as they should have on next year of buying egi and we decided we're gonna any up we're gonna become one of the intervenors along with 25 other parties to be a full participant in the whole proceedings regarding HDI the sale of eto it was an incredibly high opening experience for us very expensive because you need a legal representation and your being dollars an hour and there aren't that many of them this day you actually need this kind of regulatory law but fortunately we have some benefactors who were able to back us and when all said done we didn't take a specific position against AGI being sold to next year in terms of the merits whether it was good or bad our position was that next year had not made the case why them taking over this islands utility would be in the best interest of this islands residents they didn't want to go down granular they just said it's going to be better for everybody for all five islands that might electric serve which is this island Maui all kinds of 911 so we weren't a post per se to what they were doing but we said you guys haven't made the case of why things would be better here so July comes around the PUC thumbs down on the coastal NextEra and at that point we got to thinking maybe we should do something more than just be an intervener on the document so we made a proposal serious credible with backing to the line launcher to buy Elko and it took him a while to give us an answer it was frustrating very much for me and the other is on my side because of the tactics they were using but ultimately after a number of months we finally got them the answer was no which is their prerogative right there's they're under no obligation to sell to us or anybody and I think part of the reason of why they didn't want to go in that direction is one of the arguments they made to the Commission all during the proceedings from NextEra was yes we want to sell to next year because everybody would benefit across the island that said we don't need next year to do what we need to do so they were trying to walk this fine line between yes it would be better with next year but no we don't really need them so psychologically I'm thinking for them to have three months after getting turned down by the Commission that they were in effect willing to sell I'll go to the mean man the de-facto raising up of one metric I think though they just weren't going to go there but this is speculative on my my part all I know is that we approached them it wasn't on the golf course chit-chatting with one of the directors it was in writing it was serious it was credible I make sure it is done again that's their progress so that was three years ago so what have we been doing since I've been paying the bills minimum as they are to make sure we're legitimate we are an official 501 C 12 with the feds good IRS which is the segment for electric co-ops I applied for that we got it were a legitimate 421 see under why my statutes so we're completely legit we just we're a co-op in search of utility and I'm I'm still hopeful I'm still hopeful one of the things that is challenging right now so let me kind of take a step back and tell you what I think the co-operative is superior to other utility ownership model sense why do I check by the way there's something on earth an IOU investor-owned utility stated on the new york stock exchange okay so they have 108 million outstanding shares of which a lot of that is owned by institutional investors more than 50% they've been giving dividends but with an investor owned utility there is an intrinsic cross link between shareholders who want to maximize return on investment and repairs who want to have the lowest possible electric bills shareholders want to maximize returns which means the utility is maximizing revenue rest Sheryl up the ratepayers which is assume there be less revenue where else in the coop who owns the cloth it's not shareholders stranded on Wall Street the owners of the coop are each and every member of the coop ie each and every person pays a utility bill so there's no longer that tension between rave chairs and shareholders because the ratepayers or the shareholders are one of the same another benefit of coops is that they are not-for-profit which means that if there is a they don't got a problem there's a margin between expenses and revenue then that money can go one in two places one I can go to the original death because kou see when he came aboard there was 100 sent that fine ass they didn't have somebody with 200 million bucks in the bank saying I will make this this donation result definitely so they are having to pay back that debt right a
d they are by the way ahead of schedule and paying back the debt that's one way you can disperse the margin or profit if you will the other way is you give it back to right here and each and every year these past years okay I used to be a send a check back to it's not enough to go to Paris but it's a check you get some utility company rather than every time every month give this in their membership both members who are board and the board is the entity that oversees the day-to-day well oversight over the day-to-day operations of the actual right so every three every year July three of the nine board members are accrue up and people robbing people wins people lose so there's accountability which is another big benefit to me affirmation constantly I made five point eight million dollars last year and it was an American Savings Bank they did that yeah Hank is referring to to kind of out with the see the longtime CEO of hei who is one of the most highly compensated the execs in the same way I know Connie and I don't regret her compensation but you're not going to have conversation the five million bucks going today this oil another very good friends president pinc so you don't have that type of executive perks but the co-op level that you do a similar company on the mainland right but compensation for the CEO of that company takes San Antonio which is a similar population this whole state that CEO makes five hundred thousand dollars compensation deferred benefits and salary so how do you rationalize five point eight Union because you've got the PUC like schnapps red light enough spots and any voter home yes yes theoretically yes if you look in the ownership of HDI stock or the thirty percent of each yet stock is down by ten [Music] institutional investors so if they were to band together and have no let's say there would be an alternate slate of directors cuz PGI also has typically three or more people every year as they turn over but they were voted on by shareholders for not right here but I want to get too much in the weeds here the other challenge right now insurance make it Coco is that if you look at different segments of the American economy there is one segment that is showing irrational exuberance in the words of former Fed Chairman Alan Greenspan their number of years ago one sector of the American economy that showed double-digit growth over the past 52 weeks compared to all the other sectors of the economy which are single digits and that one that is the double digits is electric utilities go figure and one electric stock is when treating and record high levels over the past six seven month so there the value of that company is overinflated in my opinion and also in the opinion of Wall Street analysts who I keep in contact with probably to the two hundred twenty-five to thirty percent in other words they they feel that each yet stock is is significantly overpriced but what that means in the real world instead since hgi is comprised of four companies each of those four companies represents an overall percentage of the total market cap of of AGI right so that means effectively that there is a twenty five to thirty percent there would be a twenty five to thirty percent premium for the purchase of calcio if they were interested in fiji i was interested in selling because the stock price is so high why is that important it's important because i'm convinced that if we were to have a chance in my hELCO the only way i could sell it to you all and to prisons in the big island is not going to be through democratic control even though people and motormouth does not feel good the number one things that people care about not wrong as a damn utility company yes they care about the likes on and the game boys playing and the cold bit beer the fridge and in your Wi-Fi router they care about that but they also care a lot about how much they pay right so I can't possibly go out and sell the idea for co-op if I say coop is great trust us get behind us all by the way it's going to lead to an increase in your electric bill forget it no way so the more you have to spend where we have invented by hELCO the greater the depth right and the more you have to pay off that debt over time so there is a point in terms of buying company like Elko thus far as purchase price that we cannot go beyond because the debt burden would be such that we would have to raise rates so the only way I can be part of this is that the sale price for hELCO being such a price where the debt financing would allow us legitimate ly to make the case that we see a path to the decrease in electric rates over time so that's kind of where we are now we're in this bubble or hgx pockets tremendously overpriced the board of hgi and pico don't have much motivation to change things for a grammatically but all this offense towards this one teaser there are various institutional investors in hgi stock who have a different vision for that company that I happen to believe is more proactive more progressive than the currently you stay tuned over the next could you do that very I'm sorry could you get library what's the funny yeah okay yeah well re electric well electric bills across the state are paying to the Tyson soil data first was up and down the world market so there is a pass-through become yet yeah so price of oil has been running on fifty seven fifty eight dollars a barrel these past months so the price of electricity that all of us are paying for the circle are made residential goes back to September you what I can share with you is that how much money we talking about when the usually turned out next year to purchase my lecture back in July of 2016 they didn't just save one page no they issued a very lengthy decision because they you know the Commission justifies it right and in the course of justifying it we listed a value for hELCO of memory serves 768 million dollars 768 and you know this and you know right now that value will be higher so I got to thinking all party you know where does him come up with these hundred million bucks and without trying to sound too cocky I was very pleasantly surprised there's no shortage of entities out there that are chomping into this piece of this action another benefit coops have is that this goes back to the rural electrification Act of 1937 okay back in the days you had utility companies that would want to build power plants which are expensive right and if you build apparently one-celled power right and you sell want to sell more power they wait to sell more power as you distribute it and verbally dense areas right because if you have more people are going to buy the car when you start getting into the countryside of the farm areas where you have a farm every two miles or ten miles you've got the infrastructure cost of building these power poles right - so what kind of quantity of electricity not a whole lot so under Roosevelt he established through the rural electrification Act money from the best to support the electrification of the rural areas and that that particular idea has continued to the state 2019 through the US Department of Energy USDA's rural utility service our US taxpayer supported entity under the USDA that lends money at the best possible rates to coops and we got a letter from the USDA in terms of well how much of the salad is quote rural and as you know it's not sixty percent no I mean they use some criteria right eighty four eighty percent which would mean that conceivably we're by hELCO 80% of the purchase price could come from our us at the lowest possible cost of money there are other organizations that I was just about a month ago north of Dulles Airport and Virginia the cooperative finance corporation there are 22 billion dollars in assets and they would like nothing more than to work with us to with that too cocky money is not the issue near the place in the world we have a million half people that's a 44 cents a kilowatt-hour yeah where would it be parts of the world that are connected to a big grids that are asked if you know where yeah I can't give you a specific but I don't think there's any place exists nobody else in the u.s. there's no place in the u.s. sustain their parcel we have we have generation that is fossil fuel right no renewables no hydro no stuff swords limited to where the fuel has to come in from great distances and you have us say a small community that is nice elated I'm talking about a group of million okay nice people in a easy place live it doesn't exist we're getting screwed by health oh they have a guaranteed income they on these people everybody who works for helpful makes more money than anybody else on this island you forget young brothers oh yeah they got a guaranteed income too anyway so it's here pick out a hippo have to make money so there everybody's always happy anyway but anyway I'm saying we're screwed by the this Public Utilities Commission in the way that they put the price of my electric for everybody here and I've got it he look mix of Bonneville Dam that cost four cents a kilowatt-hour somebody oh it's what's the deal we're getting screwed can anybody straighten that out a challenge the premise of your what's the challenge go ahead here you're ascribing malicious or negative intent we have to pay more name's buddy else brown there's something wrong with that yeah well you know have you looked at the map of the world and seen Hawaii in the middle of the Civic part of the United States government subsidies for everything had worked rural how come we're still praying - trade just me out of the longest supply lines in the whole damn country when it comes to bringing fuel in here and we're still 83 percent dependent on imported petroleum for our economy that's why we're getting screwed when you look at salaries and everybody on the board if you cut that down because they're on the hydro as a [Music] [Music] chemical you take let's say a solar system big store that produces power during the day use that power to pump water from a low elevation and then you have an in a holding area and then when the Sun doesn't shine because you have water come back down and it submits to generators now the law of physics says you never get 100% you know you have to have energy to pump it up you're gonna get some of them coming down but it's just something worth looking at and unfortunately it's very Geographic geographically specific in terms of you have to have the right to farm feed and water source to go from you know there are four now we do it utility rates full circle whether its wind or solar may hydrogen and then when like some nibs and when we turn the hydrocracking I can say that I'm ending by the way is a I mean it's one of the most the universal universe as we know it right and hydrogen or h2 you can it is a source of energy and you can put it through a fuel cell electric vehicle these there are also things called FC beats or fuel cell vehicles Toyota Mirai is one on the clarity is one they're going to be more and more F CDs coming out and you have compressed hydrogen in between 5,000 and 10,000 psi in a tank that's within the vehicle and then the fuel cell which is kind of the power plant takes that hydrogen passes it through almost kind of magic membranes and that creates energy that causes that provides the propulsion needs for the electric motor and the only waste product if you call it that is is water and heat so the question is where the hydrogen comes from how is it made how expensive is it to me and you know the molecule for water right H 2 O so one of the ways to get hydrogen is to electrolyze it what does that mean you take water because it like your current through it and it breaks up the molecule into hydrogen and oxygen so that's one way to do it another way to do it is through so-called steam Reformation which is to actually starting this book you can take natural gas which is carbon atoms and hydrogen atoms then with steam you can break up the our hydrogen molecule into hydrogen the hydrogen molecule of hydrogen and carbon so again we're not trying to get to to techno it is possible to produce hydrogen pink has an electrolyzer on his property but he's a rather well-to-do individual so some some you can order to help people try to make your own hydrogen but it can't be done and the challenge for hydrogen is it costs money to develop to make hydrogen it'll cost money to store the engine it will cost money to transport hydrogen it costs money to dispatch some hydrogen you need a whole infrastructure and what comes first the infrastructure or the consumption or first together could that the need and then you develop the infrastructure so the supplying the man have to be calibrated you know in as an investor for example if you want to spend you know ten million dollars to establish hydrogen infrastructure on this island make the hydrogen from solar make it firmer Newell's if you don't have confidence that they're gonna be people to buy papers and right now there's how much it would enhance hydrogen why because there are not that many F CDs there are no power plants that run on hydrogen so it's really going to be this tough world careful calibration between supply and demand for hydrogen but I happen to believe that for this island given how blessed we are with renewable energy sources from solar from when that weird the best position in the whole state to be able to establish something about hydrogen using storage consumption infrastructure on this island and the generators the two generators holding the two generators Mikula are both General Electric gallon 2500 combustion turbines they can be converted to running on look they fix yourself as helped out or or hgi that on some Akua look you want to convert your power plants to hide again not only works didn't come from and what the cost of the hexerin see so excited such a simple oh hell no shouldn't change of all the hydrogen okay where's i think they come from how much is it going to cost where's the reliability of the supply so you know when you start getting into the nitty-gritty it's all well i'm good to talk about a hydrogen economy and transforming this and transforming that it's complicated it's it's risky I'm not saying we shouldn't do it but [Music] what happened to the hydrogen [Music] well Dee Tsao is you're just taking saltwater and you're effectively removing the salt then you have fresh water that's that's not the same process of breaking up a hike the water molecule to can see you're just from moving call it an impurity if you will of the salt this is there an issue scoring by Jimmy large vessels it's not on a stick it doesn't have a stability issue I heard he keep me stored in is a solid and when you give we're going to begin in terms of percents like eight three depending or something we're as far actually from the different islands energy contract how much or reducing petroleum usage I don't know buddy median number for you I mean one of the ways to ferret out if you want to do some digging and State Energy Report pretty much what I actually have the figures they just haven't in percentages for firming the Federal Energy Energy Information Agency yeah because it keeps it very hard to get to spreadsheets are dead [Music] we don't have building whatever you have utility-scale solar plus storage on the mainland is going in a trace closed for five cents a kilowatt hour for a 20-year realistic and the lowest rate we've seen so far on this last round on the proposals that were accepted everybody see us now I expect this this current market they have to believe that those winners are going to be less but not I don't think they're going to be in the five six or seven when you stay with story for five hours which isn't a long time but at the same time for five years ago we can have that know so this storage is only going to get longer terms of being able to discharge over six hours ten hours and longer what you pay for [Music] for these generation costs are really keep in mind the generations is a only this one is my side the total cost of unites a there's infrastructure well where I know you know in the real world solar thermal to produce electricity which is this great big tower to the desert that's got this 360-degree mirror and
you have a whole bunch of what are called heliostats around it which your fancy works for mirrors so the sun goes over the mirrors track and they concentrate all these thousands of mirrors on the tower which creates thousands of degrees right which can cause phase change from solid to liquid and then it releases that energy when it goes from the other way around right I don't know the energy efficiency and that menopause has not been without problems one of the things that certain people are unhappy with is the fact that you have birds who are still flying in the area and if they happen to be caught up in a beam Ariens gonna be frightened it that the folks who were plant called streamers because this just in disguise they also developer of the project in that area that were there was an endangered species by the name of desert tortoise we're talking about this paper and they were moved they relocated all the desert tortoises within this big circumference and the cost for every tortoise in terms of relocation you know value being placed on the native species right so ii didn't even go back to your question about solar thermal it's a lot more limited in applicability and practicality then pv takes southern conductor typically of silicon you do some go into it you have wires on it and put in the senate last 20 to 30 years type of battery you're using now in here what is there well the the tesla powerwall which is their residential kochi products I have one of my house as well is a thirteen and a half kilowatt hours thirteen and a half kilowatt hours and fYI the average consumption per household in the state of weighs about eighteen to nineteen kilowatt hours a day so in my mind electricity use which is moderate and I have a photovoltaic system before kilowatts so you know I actually turned off my hELCO power a while ago just to go on solar and storage alone I could go indefinitely so how big is this unit and how much does it weigh join my 16 260 pounds 200 260 yeah what is it about size that yes if you were to if I were to take the destined rectangle kind of sort of death let's pick yeah let's have the money well okay you have to one there's a empty box that's not it Estelle's yuki-onna so cheap right it's bigger than that it is bigger than that and it has more energy stored storage whatever you are able to get to more than four hours ss-sure without fob Ouellette then you get more attention from the utility company because it begins to come closer to firm power where they can rely on it for a longer period of time rather than a short period of time I mean there was a story couple months ago yeah I you see that a there was some type of a fault it was a cable I believe that corroded and brought the whole island down they have 33,000 great pairs there roughly 7,000 people who live there and what happened to the storage for crying out loud chaotic sea has been on the front lines as far as solar plus storage on the utility scale far far beyond with my electric has been doing because there are a number of cloudy days so the batteries weren't at a full state charge to be able to help the utility drive through this is fault so that's not ki you see from I mean there are times when your batteries don't get stored or don't get to hundred percent see the charge [Music] with your production well they have more solar than than we do but I mean yes it's a more northern latitude but they're mean through successive governments through the Social Democrats in the 1990s they put a great value on silver big-time you know I'm not against wind but guessing the reading in his last few weeks about demonstrations in North Shore Kahuku would be the largest wind turbines in the state we're talking more than 500 feet even bigger than the one south wind they are the ones already cuckoo with the three blades that go up more than 500 feet and you have the folks there who live in the area who said no even though he co got all the approvals approved by the PUC there were dozens of people arrested there was an active substantial maliciousness someone he actually kept out elbow transmission Eco transmission bulk which you know about putting people's lives at risk and you talk about the power holes so I'm not minimizing the unhappiness of legitimacy of their concerns it brings me to one important point which I don't think I made which I should is that there's no such thing as a free energy lunch every choice we make has consequences and I wouldn't want to be within sight or hearing of a 500-foot which are going to because for one thing even though they're not spinning around like an eggbeater but you know running around that they're going slowly but it creates a low frequency that can propagate a long ways I mean miles and miles and miles and you know if you want to live in an environment where you're not just hearing it but you're feeling this low-frequency hum you know all the time so I'm not saying when is good or when is death but we have to take into account the social justice argument that you know these wind farms and these other plants these power plants they get put in areas where the rich people don't live right because the rich people would want that in their backyard so it's the people on the lower you and the economic spectrum you have to essentially put up with the disruption of having big winter so we cows live very witty places well if you look at the most wins energy friendly stand in the whole country is Texas [Music] going on the world where you've got ties in the house you will differ between one part of the day to the next or two later on to the 10 20 30 so but that's rather site-specific right in terms of being able to put something 100 feet out thousand yards out and it's going to create energy by the way commercially there's a place in ramp's France where there's a heat wave damn there and they use depending on the provider to installing a blue install permitted engineer anywhere from twelve to sixteen thousand so the one you have is where at that lunch well that's all in everybody yeah I know you did a chef's and you kid for you but what does it batter cost just to buy it in well I mean I'll suggest that you go to you know the Tesla website in your hand see for yourself oh come on you can tell me I'm not gonna like I said you know depending on who you buy from if you buy from Tesla direct it's going to be cheaper but the fact is that Tesla well let's give a summary what is it but just good twelve to sixteen just for the patent all and that's the whole system or is that just about that's for the energy storage integrated in a solar electric system okay now to give you hear in 2013 yes sir no my question like say you buy an old house and you want to convert it this whole there what is like really depends on what what just expects energy consumption is I mean we do home soon you know the McMansions on the west side where you know I've sold systems to the tune of quarter million dollars to folks who have the money with for solar and storage but most people don't have a quarter million to spend doing that so I mean will sell PV systems for homeowners they will have more modest homes anywhere from 20 to 50 yeah and can you get a loan like attached to your mortgage for that or for the construction of how people sure they're that's one of the areas where there's actually quite a bit of support you can get credit union loans many people do here in the state there are other national companies that offer plans programs there is a program that you can actually attach the cost of a photovoltaic system to to the mortgage so yeah financing typically is readily available there number of avenues [Music] [Music] how would you how would one drop the strategy try to drive stock price down so that the cost of utility I hope it would be more cost-effective to buy I don't have any answer for you [Music] [Music] we're talking about a different path we're talking about the political power so meeting people for the people at one point in time is it an option for the people to make a decision rather than the corporator well my wife's Argos a publicly traded company they have a fiduciary responsibility to their shareholders okay so if an entity were to come to them and offer them a credible offer okay in writing 1.2 billion dollars that would trigger that would require them the board to go through formal procedure to consider that offer and if I offered a 1.2 billion dollars that would get their attention okay but there's no way according to our numbers people who I respect a lot of you know a lot more about this than I do there's no way that I can get 1.2 billion dollars to work in terms of the coop but also regulated by legislative acts that our state governments would enact right so is it possible that you can have a movement within the state government within the legislature supported by the governor that would essentially be a state sanctioned takeover of a public utility because it would be in the public interest yes that is theoretically possible is that practically possible hell no why one of the reasons is because my electrician is very well-connected literally figuratively and there is no movement at this point that would essentially seem to break up by four so if you a hostile takeover of a publicly traded company I see no but theoretically I mean maybe you think keeping up with what's going on you're like California Northern California mine either but my birth I was served just last week and weeks before then the gas and electric PG&E is the largest single utility in the state fifteen million customers and anywhere in the country they're huge they've got problems as a plate right now require dozens of people dying the bankruptcy earlier this year so now you have the mayor of San Jose San Ricardo misses on the news hour check it out this evening public leaders of states of municipalities in Northern California who are saying we should take over P cheating we should turn it into a oh that is how what PG&E wants PG&E is trying to end their bankruptcy plan through the bankruptcy judge so the company is kept intact they do not want to see the company broken up but who knows whether this co-op idea because I can tell you anybody who's familiar with the early California there's a tremendous amount of rage and hostility for us to be tuning these days for good reason so I see the potential that I have never seen before that PG&E is going to be broken up and a good solution would be for me would be to see sounds day and other areas in Northern California that would effectively turned money into a cooperative that would be very complicated in the long process would be very expensive but maybe that's an example where there would be enough public support and people would chime in and get a chest with their legislatures the marshals fees and so forth I mean maybe there's that nexus right maybe there's that critical mass with it'll be enough people that PG&E will me now be phenomenal absolutely phenomenal and I know my co-op friends in Virginia are watching very carefully I have an uncle and a cousin they work for PG&E since 1928 they will they could never believe that this is happening everybody thought that was like you know just like it's just listen to you talk about this problem it sounds like constraints for meeting the demand for not putting more carbon in the atmosphere and providing electricity for the public is this economic constraint and but it doesn't sound like that the state is actually developed a real plan for for serving the communities laying wooded what is needed locations work projects I mean a lot of states in a lot of countries they do this as as a basis for going forward with these kind of project 100% renewable for electricity generation by 2045 national coverage twice and for front pretty big degree what I've found kinda lacking is how we gonna get there what's going to happen the next five years that's completely absent so typically the politicians like to kind of you know the takeaways is getting by the presence of wonderful things will happen 26 here I'm much more you know again I'm being in the business I'm much more concerned about year to year cash flow and revenue rather than 1% renewable in 26 years so to your point yeah I think there's there's lack of kind of the central plan and then kind of up to the individual utilities to to do what they can not like I said early on the telco was a leader for for many years you know and I give a lot of credit for that and I think more so than any other elements of shame we do have a potential for greater potential to be more energy independent cost-effectively energy independent than any other item in the chain and it's gonna take leadership take money is gonna take support in terms of tax credits it's going to take people being willing to make hard choices and and understand that there is no such thing as a free energy choices there are costs involved you can't continue to say no to this option because we don't want to see wind turbines they know to that option and you know we literally just start painting painting painting into a corner walking across the paint right so you know I try to be optimistic sometimes it's a challenge you guys heard my my good buddy Russell Ruderman last week and I did I saw [Music] you're gonna be mayor right mayor yeah Brussels ready to step back from the stage because he will be completing to two terms in the Senate total eight years and I mean he's my hands-down tries to be mayor but if we had a Russell Ruderman or somebody who is in to really implementing a green new deal for the silent I think that would just be phenomenal she came up she was one of the along with Ed Markey senator from Massachusetts you know they came up with the green new deal four months ago I read it you know page one two to the n that that this sounds great unfortunately Nancy Pelosi being about her spec for Nancy but she buried you know there's nothing going on unfortunately for the green new deal in the house just do that but locally we had the political leadership and a county council that was behind it folks I'm kinda running out of steam here [Music] [Applause] [Music]
