President barack obama city & country of honolulu-honolulu authority for rapid transit (hart) - continued investigation, audit and oversight
Published on: Mar 4, 2016
Transcripts - President barack obama city & country of honolulu-honolulu authority for rapid transit (hart) - continued investigation, audit and oversight
Clifton M. Hasegawa
President and CEO
Clifton M. Hasegawa & Associates, LLC
Chairman, President and CEO
Kaimanu Maritime Corporation
1044 Kilani Avenue 12
Wahiawa, Hawaii 96786-2243
Telephone: (808) 498-8408
Via Electronic Media
July 4, 2015
The Honorable Barack Obama
President of the United States of America
The White House
1600 Pennsylvania Avenue NW
Washington, DC 20500
Re: Thank You
Senator Daniel K. Inouye - The Rail Transit
Department of Transportation Inspector General Complaint
Audit and Investigation of the Honolulu Authority for Rapid Transit (HART)
Transit from Kapolei to Ala Moana Center and The University of Hawaii
Dear President Obama:
Thank you for your oversight and the $230 Million for The Rail Transit Project.
The operation of The Rail Transit is dependent on electrical power. The City and
County of Honolulu, Federal Transit Authority (FTA) Identifier 1703, operates H-Power, a
biomass waste-to-energy facility. H-Power produces 46 megawatts of firm, dispatchable,
uninterrupable power. Inquiry to the City and-County of Honolulu (C&C of Honolulu) and
the Honolulu Authority for Rapid Transit (HART) has revealed that use of H-Power has been
rejected on the grounds that, “Use of the H-Power electricity for the Rail Project would be
considered ‘wheeling’, which is not authorized.”
Residential wheeling, installation of roof-top photovoltaic systems, forms, in large part,
the foundation for the Hawaii Clean Energy Initiative. Utility scale systems, wind,
geothermal, and photovoltaic, installed by Independent Power Producers; Hawaiian Electic
and its operating units, Maui Electic Company Ltd. and Hawaii Lighting
Company; and Kauai Island Utility Cooperative provide electrical power for the utilities.
The Hawaii Public Utilities Commission, in reponse to my inquiry, has advised that
the C&C of Honolulu and HART have not made inquiry or submitted application for
approval to utilize H-Power for Rail Tranist Operations. Advocacy by the Intragovemmental
Wheeling and the integration of H-Power to provide for the C&C of Honolulu's needs is
discussed in the enclosure to this letter. The use of Power Purchase Agreements by the
Parties, in this case, the C&C of Honolulu, HART and HECO has been approved by the
Hawaii Public Utilities Commission.
Total Power needed for The Rail Transit System: 30 Megawatts to 50 Megawatts.
Firm Power Firm Power is electric power from a generating station available for use
under all conditions. Baseload plants (coal and nuclear), Intermediate load plants (combined
cycle natural gas), Peak load plants (natural gas or oilburning), Hydroelectric and Geothermal
plants generate firm power. Firm power is counted towards the energy security of the Grid;
Intermittent Power does not count towards the energy security for the Grid.
Electricity from wind and solar generators are subject to weather conditions. Wind
generates more power at night, when demand is lowest. During daylight hours, power
generated by the utility takes precedence and power from wind energy producers is generally
curtailed. Solar panels work only when sunlight is available and do not satisfy peak
1 Hawaiian Electric Company has applied to the Hawaii Public Utilities Commission to
approve the sale/merger with NextEra Energy, one of the nation's largest power
producers, that designs, builds, constructs, installs and maintains renewable energy
systems, largely photovoltaic and wind systems.
The Hawaiian Electric Companies will deactivate a total of 226 MW of Firm Power
Generation by the end of 2016.
Two generating units at the Waiau Power Plant (Oahu) will be deactivated by
Hawaii Island’s Shipman plant has already been deactivated
On Maui, two of four units at Kahului Power Plant were deactivated in 2014,
and all four units will be retired by 2019.
Source: Hawaiian Electric Company (HECO)
The reluctance and given rationale by Mayor Kirk Caldwell, Members of the C&C of
Honolulu Council, and HART CEO and Executive Director Daniel Garusbaskas to utilize
H-Power to provide electrical power for The Rail Transit, examined and and advocated
during the administrations of Mayor Mufi Hannemann and Mayor Peter Carlisle,
marginalizes and minimizes delivery “On Time and Within Budget.”
The Honolulu Authority for Rapid Transportation’s Board of Directors selected Daniel
Grabauskas as CEO and Executive Director on March 22, 2012.
“Dan Grabauskas has shown himself to be a proven leader in the transit industry
and we are very excited to see him come aboard at this time,” said Keslie Hui,
chairman of the HART board’s Human Resources Committee.
“After an extensive screening process, the board concluded that Mr. Grabauskas
was the one for the job: he is an honorable public servant, passionate about
public transportation in general and our project in particular, and he is fully
committed to using his considerable knowledge, skills and experience to
delivering rail to the people of Honolulu, on time, and within budget.”
Source: HART News Release. March 2012.
December 18, 2014 - The Warning: “[T]he Honolulu Authority for Rapid
Transportation board meeting in Kapolei, warns that the $5.26 billion rail project could wind
up costing taxpayers 10 to 15 percent more than budgeted. A 15 percent increase would raise
the project's total cost to more than $6 billion.” Source: Honolulu Star-Advertiser.
June 29, 2015 – The HART Warning Confirmed by Governor David Ige: The cost to
complete to the rail project will be $6 Billion. Source: Honolulu Star-Advertiser.
Continued investigation, audit and oversight of The Rail Transit project is incumbent.
Thank you for your continued intervention and oversight of The Rail Transit project.
Clifton M. Hasegawa
Enclosure: Firm Power for Honolulu Rail Transit project
Copies provided to:
DOT Inspector General, Calvin L. Scovel III
DOT Deputy Inspector General, Ann Calvaresi Barr
FIRM POWER FOR HONOLULU RAIL TRANSIT PROJECT
POWER PURCHASE AGREEMENT
Docket No 2007-0176
INSTITUTING PROCEEDINGS TO INVESTIGATE THE IMPLEMENTATION
OF INTRAGOVERNMENTAL WHEELING OF ELECTRICITY.
File Date 06/29/2007
HART Response to Request for Information - July 3, 2015
QUESTION 4. Hawaiian Electric Company (HECO) and/or NextEra Energy and the City &
County of Honolulu and/or HART use of H - POWER electricity for the Rail Project.
HART RESPONSE TO QUESTION 4: HART understands that H-Power electricity feeds
directly into the Hawaiian Electric system. Use of the H-Power electricity for the Rail
Project would be considered ‘wheeling’, which is not authorized.
1. Wheeling Docket is Open. Verified July 4, 2015, 5:54 a.m. [HST]
2. Docket No. 2007-0176. City & County of Honolulu. Motion to Intervene or to
Participate. July 18, 2001. “As a large consumer, the City is interested in and
concerned about its ability to take the steps necessary to lower its electricity costs,
including wheeling self-generated power to its facilities.”2
2 Carrie K. S. Okinaga, Esq., then Corporation Counsel for the C&C Honolulu was
appointed General Counsel for HART has left HART and is currently General Counsel for
the University of Hawaii.
3. “[T]he commission is granting intervention to all of the Governmental Entities, it need
not reach any of the alternative motions to participate.” Hawaii Public Utilities
Commission Order 23677, September 21, 2007.
4. City And County Of Honolulu's Comments Regarding Suspension Or Termination
Of Docket, October 18, 2010. “[T]he City has proceeded with the development of the
Third Boiler at its HPOWER facility on the basis that it would be necessary lo negotiate
a power purchase agreement with HECo. Such a facility would be the very type of
project that might in the future be encouraged by the existence of an
intragovemmental wheeling process. The City is interested in exploring any and all
options for the reduction of its energy costs and with the implementation of renewable
technologies, and believes that an intragovemmental wheeling process could serve as a
catalyst for projects with these goals.”
5. Commission Order Adopting Procedural Schedule October 18, 2010. Makes Referral to
Docket No. 2008-0273.
Docket No 2008-0273
INSTITUTING A PROCEEDING TO INVESTIGATE THE
IMPLEMENTATION OF FEED-IN TARIFFS.
File Date 10/24/2008
DOCKET NO. 2008-0273
City & County of Honolulu – Opening Statement, in part, states,
“The Joint Proposal filed by HECo and the Consumer Advocate contemplates a
project-based feed-in tariff ("PBFiT") limited initially to four technologies, with low caps and
a focus on interconnection at the distribution level. As such, does not appear to fit well with
any near term plans of the City to expand its generating capacity. It seems unlikely that the
City would submit any project under a PBFiT in the form presently proposed by HECo and
the Consumer Advocate.
Subject to the foregoing general observations and caveats, the City sets forth the
following opening positions:
It is the City's position that biomass and biogas technologies should be included in
initial round of the PBFiT. There has been Hawaii experience with biomass projects
and there are potential biomass and biogas projects close to being ready for
development. Further, these technologies offer firm, dispatchable energy and pose
fewer difficulties for integration into the HECo grid.
At some point, the Commission will need to clarify the eligibility of municipal solid
for the PBFiT. It is a form of biomass technology as currently
defined under Hawaii's RPS standards. Despite that, it is not covered initially by the
Joint Proposal, nor does it appear that alternative proposals will necessarily cover this
DOCKET NO. 2008-0273
Commission Order – September 25, 2009, in part, states,
“Accordingly, biomass and biogas projects are excluded from the initial FIT.
However, depending on their size, they can seek contracts through the FIT baseline
rates described below, negotiated PPAs.4
competitive bidding, or any other
available procurement mechanism.
A renewable resource under an existing PPA should not be allowed to convert to a
FIT. Given the purpose of FITs, which is to hasten the acquisition of renewable energy,
the commission finds that existing projects with negotiated PPAs are not eligible to
convert to FIT rates. The FIT aims to stimulate the development of new renewable
energy proj ects; an obj ective not accomplished by providing FIT rates to existing
projects. The commission recognizes the value of moving away from fossil fuel-based
avoided cost rates. However, without the ability to compel all projects receiving
avoided cost rates to convert to FIT rates, the commission can not fully accomplish this
Only projects that anticipate higher revenues through the FIT would likely convert to
the FIT, increasing ratepayer costs without fully delinking electricity rates from fossil
Additionally, in allowing such conversion, the commission would need to further
complicate the FIT by deciding how the rates and terms might differ for existing
projects. The commission, moreover, has no authority to relieve parties to existing
contracts of their contractual obligations. If parties mutually consent to a contract
revision they may bring the revised contract to the commission for approval.”
3 “H-POWER began operation in 1990 and today converts more than 2,000 tons of waste per
day into electricity to power more than 40,000 homes. H-POWER is the cornerstone of
Honolulu’s integrated waste management system. H-POWER produces 7% of Oahu’s
electricity and reduces the volume of refuse going to landfill by 90%. On Oahu, waste-to-
energy works in partnership with recycling efforts to significantly reduce the amount of
waste going to landfills.” http://energy.hawaii.gov/city-and-county-of-honolulu
4 PPA (Power Purchase Agreement)