 Okay, we're back. Just another manic Monday, as they say, right? And that's Marco Mangostorf on the phone from Provision Solar in Hilo. And it's the noon block. And it's Energy 808, the cutting edge. Hi, Marco. I feel once again so honored to be on with my good friend Jay Fidel. I'm always wondering, now what are we going to talk about interesting today? And yet we always find too many things that we just don't have enough time. So let's give it another try. That's a true statement. I wouldn't argue with any of that. Okay, let's begin with the fate of Honore Ola biomass burning power plant at Hamakua. What's going on with that? Well, before we do that, I just wanted to share with people the little factoid from last week, since we've been talking on and off over the past weeks about the fate of Pune geothermal ventures. Oh, yes. The thermal power plant in the Pune area here. They were fined last week for 11,000 plus dollars by the State Department of Health for an emissions violation that obviously took place prior to them shutting down on the first days of May. So they weren't the only ones. AES on Oahu and a number of other companies were fined as well. But I'm just worth noting that apparently sometimes or sometime in the past when they have been producing geothermal power that their emissions were beyond certain threshold and the state to find them for that. So moving on to another power plant. Wait, before you go, I just have to say, isn't that like kicking somebody who's down? Well, I mean, you're an attorney and I think it's more more about applying the law. I mean, if there is a violation that took place that was demonstrable, improvable, incredible, then that's what the State Department of Health is supposed to do. Is there no clemency here in River City? Is there no extenuation and mitigation? It just seems like they're kicking somebody who's down, who's suffering enormous losses. Enormous losses, which are probably substantially offset by the business interruption insurance, which they have. So I'm not going to cry too many crocodile tears for the okay. I don't see a lot of sympathy there. Okay, let's move on to Hamakua. Just saying things. And I've been following this power plant for for quite a number of years and let's give it a little bit of history. So for decades, the Hilo Coast Power Company up in Pepe Keo, up going northwest from Hilo, had been using the refuse of post sugar cane harvesting, which you and I both know as the B word as in bagasse. They had used bagasse as a fuel source there at the power plant up until 1994, which as we both know, was essentially the end of sugar cane, sadly here on this island after many, many, many decades of sugar cane being a very important part of the community, important part of the economy. In fact, my grandfather worked in cane his entire life from when he moved to Hawaii in 1925 to his passing in 1989. So interesting little fact right there. After 1994, no more bagasse to be had, Hilo Coast Power switched to, can you guess what fuel source? Say it again. Can you guess what fuel source they switched to after they ran out of bagasse to burn? Oh, I would imagine, well, I would imagine some kind of fossil fuel. Coal. Yeah. Burn coal. They burn coal here on the Big Island from 1994, roughly to 2004, when Hilo Coast Power shut down and the power plant, it was for, since then, so for 14 years, there's been no power coming out of that power plant. And folks on the mainland decided a number of years ago, gee, we can make money if we revivify the plant there, Hilo Coast Power Plant. And what else can we burn? Let's see. We don't want to burn coal anymore. How about we burn trees, aka biomass, that's that are grown nearby? And they signed a deal a number of years ago. I think it was a 2012-ish with Helco to reanimate the plant and sell Helco the power under a long-term power purchase agreement at roughly $0.28 a kilowatt hour, burning biomass, locally produced biomass. Wow, $0.28, yeah. $0.28, right. We'll keep in mind that this was prior to the days of renewable energy coming down as much as they have come down in the past handful of years. And they were moving forward with that plant. They were spending money, this mainland company whose name escapes me for the moment, was spending substantial money bringing the plant back into operation. And yet they also failed to meet a number of contractual deadlines. And Helco, in my opinion, was more than generous, more than understanding, more than tolerant of multiple instances of not meeting contractual deadlines. Finally, Helco had had enough to cancel the contract. They were sued by Honua Ola, also known as Hu Honua. They were sued for trouble damages, which was going to come to somewhere around half a billion with a B, half a billion dollars. They were sued for breach of contract that I think was a negotiating ploy on their part. Helco and this company sat down again to renegotiate terms. They came up with a different PPA at roughly 22 cents a kilowatt hour all, of course, less than 28. And Helco decided, well, we've done the best we can for our company. We've done the best we can for ratepayers. Now it's in the hands of the Public Utilities Commission. So I went to the PUC for review and approval. And much to my great surprise and dismay, the PUC signed off on the Power Purchase Agreement May of last year, May of 2017. And the trigger they needed to continue to spend substantial sums to bring the power plant back online. They hired my old friend, Warren Lee, former president of Helco, prior to Jay Gnasio, taking over 10 years ago. They hired Warren to be the president there. So Warren is now heading up their efforts to bring the power plant back online. So, lo and behold, our friend, Henry Curtis, life of the land, Enviro Crusader for a very, very long time, done some good things there across the state. He filed a suit against the decision on part of the PUC to grant this Power Purchase Agreement and his argument, which his attorneys made the argument that the Hawaii Supreme Court a week or so ago, was that the commission aired, they made a fundamental mistake in approving this Power Purchase Agreement because they did not take into account the fact that even if it's burning locally produced biomass, it's going to be contributing to greenhouse gases and pollution. And that part of the state's goal, part of the state's stated strategy to reach 100% renewables by 2045, that there was an element to that strategy and those goals to minimize the amount of greenhouse gases that are emitted in pursuit of the wanted 100% renewables in power generation. So Henry's attorneys, I thought, made a very good argument. I haven't heard the verbal, I've read the transcripts, I haven't heard the audio. And I thought some of the justices there, their five justices, of course, on our Supreme Court, made some very, very pointed questions in terms of why didn't the commission, why didn't the state take this into account. So the number of the issue here is, in my opinion, Jay, is the emissions that would come out of this Power Plant, is it something to get to, is it reason to remand the decision to approve the PPA? Is this negligence or negligence in the part of the Public Utilities Commission to not take into account the pollution aspect of the Power Plant? Is this cause enough to effectively overturn the administrative approval by the PUC of this PPA? Is this reason enough to do something relatively unprecedented, which is to overturn and remand back to the PUC through judicial fiat, a decision that they made in this case about a year and a half ago? So that's another the issue. Is this adequate grounds, and according to Henry's attorney, yes, that's the case. According to the state's attorneys who argued against that, of course, they would make the counterargument. But the critical question is, does this justify, has this reached a bar where the Supreme Court can and should remand this approval of this Power Purchase Agreement back to the Public Utilities Commission for Reconsideration? Wow. That's got some real moment to it, doesn't it? They're saying it's not consistent with our goals and all that. Even though specifically, I mean, I don't think that biomass is outlawed, it's just maybe arguably not consistent with our goals, our clean energy goals. I wonder, they've taken a policy position on something the PUC has dealt with in its own, on its own. So what did the government say? Or rather shall I, yeah, what did the PUC say? They must have been represented in this hearing. Well, the PUC was represented by the state's attorney, state attorneys. And I don't remember verbatim the counterargument, but I mean, it would be a very big deal. In fact, I can't think of the last time since statehood, and I haven't taken a deep dive into the database on this, but I can't think of a time at least since I've been here for going on 20 years, where a court in Hawaii, where there's been the Intermediate Court of Appeals, where there's been the Supreme Court, has effectively overturned and remanded back to the commission a decision that the commission made. So it would be a very, very big deal if this were to be the case. And I can't speak for who Honua Ola and the money source, the investors on the mainland who are spending the money to bring the power plant back, that's to me a substantial wild card that as they're continuing full speed ahead to bring the power plant online sometime in 2019, how much of a risk, how much of a liability do they assign to the possibility of an adverse decision from the Supreme Court, the Hawaii Supreme Court, that they would remanded back to the commission for reconsideration. And if that were to happen, I mean, that would really be, I think, quasi-catastrophic for the power plant because that would set things back for months. And I'm tabled, and they've already lost a substantial amount of money, I think, the fact that they haven't been able to get online sooner. So I think it's a fairly big deal. And to what extent we do take into account, is there a difference between greenhouse gases that come from a smoke stack that's being a biomass product? I mean, and I don't know that the science, you know, per one BTU of coal burn compared to one PTU of a tree burn, do you differentiate that some pollution is better than others and some pollution worse than others depending on what you're burning? So I think it's a really juicy question. Yeah, I agree with you. I'd be juicy to find out what the PUC said in its order, because you were using the term that the PUC arguably should have considered the fossil fuel aspect of this deal. Maybe it did, to some extent. Maybe it's in the decision. On the other hand, maybe it isn't. No, they did not take into account my recollection of reading the DNO from May of last year, that there was no discussion of putting stuff in. They made the, they came to the decision and the approval on another ground. So there was, I don't recall any discussion in terms of thou shalt be permitted to burn this, but not that. I mean, there's also been some discussion in the contract or Henry has made note that the folks that if it were to go online at Honua Ola, that it's possible they could use biomass coming not from this island, but from some distance, possibly greater distance. So if that's the case, how much sense does it make to bring biomass in from hundreds if not thousands of miles away if there happened to be a shortfall of biomass, i.e. trees to fuel the power plant here? Well, you know, if the Supreme Court says, why don't you, you know, consider that, take it into account, depending on the language of that particular decision, maybe the PUC can say, okay, all right, we looked at it. We looked at all the possibilities, all the options, all the considerations. And as far as we're concerned, it's still good. And it's still consistent with moving toward a green energy future. On the other hand, the Supreme Court says, no, you can't do that. You can't do this kind of deal anymore. There can be no biomass. That would be that would be pretty stiff. I'm not sure they would do that. But we got to watch and see what happens. One of the differences would be that on this particular commission, our friend Jenny Potter is a commissioner, whereas last year in May of last year, Jenny Potter wasn't on the commission. You had Jay Griffin, you had Randy Watson, you had our friend Tom Borak. So there's a different makeup of the commission. And it's a different time now compared to a year and a half ago, because the regulatory environment, in terms of renewables coming down and cost, you know, it's rapidly evolving. So I think, like I said earlier, I think if the commission, if the Supreme Court were to rule that there was a procedural flaw because the commission did not take into account greenhouse gas emissions in their decision, then they would say that there's a flaw. We're not telling you what to do, but you must at least consider these important factors in your decision. I think if they were to do that, it would be, it would be earth shaking, I believe here, because like I said, that would be relatively unprecedented. And it would really set this project back, probably my guess is a quasi death blow. But also move us further toward a pure green energy future, wouldn't it? All of a sudden, this kind of energy generation wouldn't be nearly as feasible. And I doubt an entrepreneur and investor would want to try it again. I doubt the PUC would want to try it again. So we're in a new world because of this case. And we'll be in a very new world if the Supreme Court rules against Ho-Hunua. They're interesting. But you know, there's another issue before we run to a break, Marco. You got two lawsuits, right? You got a lawsuit for, what did you say, $200 million by Ho-Hunua against whoever's holding it up? They dropped it. They dropped the lawsuit after Helco agreed to revise power pressure. Oh, got it. Okay. All right. I see. All right. So it's left with Henry Curtis' lawsuit and that will determine the future of this plan. Let's tell, oh, I want to ask you one more question before we leave it. And that is, what is the difference environmentally, you know, in the larger sense, environmentally between burning bagasse and burning biomass? Is it the same thing? Excellent question. I don't, I don't have an answer. I don't have an answer for you. Okay. Well, given that, we'll take a break. That's Marco Mangostorff. He's with Provision Solar. He joins us every two weeks on Energy 808. We'll be right back after this break to talk about more very interesting developments in the energy landscape. Hey, Stan Energyman here on Think Tech Hawaii. And they won't let me do political commentary. So I'm stuck doing energy stuff, but I really like energy stuff. So I'm going to keep on doing it. So join me every Friday on Stan Energyman at lunchtime, at noon, on my lunch hour. We're going to talk about everything energy, especially if it begins with the word hydrogen. We're going to definitely be talking about it. We'll talk about how we can make Hawaii cleaner, how we can make the world a better place, just basically save the planet. Even Miss America can't even talk about stuff like that anymore. We got it nailed down here. So we'll see you on Friday at noon with Stan Energyman. Aloha. Hey, Aloha. My name is Andrew Lanning. I'm the host of Security Matters Hawaii airing every Wednesday here on Think Tech Hawaii live from the studios. I'll bring you guests. I'll bring you information about the things in security that matter to keeping you safe, your co-workers safe, your family safe, to keep our community safe. We want to teach you about those things in our industry that may be a little outside of your experience. So please join me because security matters. Aloha. Okay, we're back on Energy 808 on a given Monday morning with Marco Mangalzo from Provision Solar joins us by Zoom from Hilo. And we're talking about various really interesting things that have happened. Let's talk about the next one on the agenda here. What's up with Tesla electric vehicles and battery storage? And I guess, you know, you could throw in hydrogen too, because that's always involved. The Germans were here last Tuesday. They had a big conference at the east west center. The one is at the German Hawaii energy clean energy symposium. And one of the big panels and discussions was about how all this interacts with hydrogen. Anyway, so what's going on with Tesla? Well, some pretty big news. I mean, you know, and full disclosure, I'm a Tesla certified installer along with a number of other providers here in the state. So I do have something of a vested interest and I also have a Tesla power wall on my home that provides me backup power with my fee affordable take system if and when there's a utility outage here in in Hilo or in my neighborhood. So the big news a couple weeks ago was that Tesla announced their third quarter earnings in terms of both revenue and income. And for only the second time in Tesla's history, they were profitable in Q3 to the tune of somewhere over $300 million, which was something that Elon Musk and his crew and everybody involved with Tesla worked very hard to do to move a lot of product, both vehicles and battery storage during the third quarter. Elon Musk himself has said it's critically important that we be profitable. So in the way you get to one year is where the profitability is you start with the first quarter and the second quarter and third quarter until you get to four quarters. So you got to start somewhere that you know, I'm not prescient enough to say whether I think they've turned the corner definitively because they have a number of big challenges ahead of them. I think and I won't call it a revolution because that I think is massively overused as an adjective or noun, but I believe that are going to be kind of the new holy grail for renewable energy and for being able to like we talked about it going to burn biomass if it comes online or PGV, which the 25 megawatts of PG were to come back online, is at an avoided cost rate, which is higher than what solar plus storage is coming in these days. So there is a wave that Tesla and others are writing, including folks in China and South Korea in terms of these gigafactory size plants that are on the board are actually close to being in operation, that energy storage is a way to be able to turn what is traditionally non-firm power such as blowing wind on wind turbines or solar panels to turn non-firm power into more firm power. So we're not quite there yet. We're not there yet in terms of a solar plant having enough battery storage to let's say go through a 24 hour, 12 or 24 hour cycle. But we're getting closer and closer, you know, month by month and year by year as storage comes down in price and is renewable energy to be much more firm and help us do what we need to do in terms of stop putting so much stuff into our atmosphere. Yeah, and I don't know if you've seen it, but in Kauai there's a Tesla battery facility that's just all over the landscape and is helping KIUC do relatively cheap photovoltaic and they've got huge installation there. And I forget the exact amount, but it's relatively cheap, way cheaper than half as expensive as what you were talking about with Honua. So yeah, it's all about batteries, but you know, hydrogen is close to that and hydrogen is movable. I mean, battery is really heavy if you want to move it around. Hydrogen is light, it's gas. Where does that fit? Do you have any thoughts about where hydrogen fits in all this notion of moving into photovoltaic with storage? Well, the number one question has to be, where does the hydrogen come from? You can't just dig a hole in the ground and have hydrogen come bubbling up and pressurized and put in tanks, right? It's the earth's most prevalent element, I believe. We breathe in some hydrogen every time we take a breath, but where does hydrogen come from? Well, one place to come from is you can take a, if I'm not mistaken, not being a chemist, you can take a natural gas such as butane, propane, pentane and you can carve out the hydrogen from the CH molecules there, but that's taking a fossil fuel and you have to use some energy to be able to split that hydrogen off from the molecule. Another way to get hydrogen is to electrolyze water, which as we know, waters H2, two atoms of hydrogen, one atom of oxygen, so if you put an electric current through water, you split up the molecule into hydrogen and oxygen, so if there is a renewable way, if it's a cheap way, if it's an environmental friendly way to create hydrogen here locally and not have to bring it in across great distances of the ocean and super high pressurized tanks, then that makes a lot of sense and I know Hank Rogers at his ranch and Paul Pontia and the group at Blue Planet have definitely been very interested in hydrogen, in fact Hank has a hydrogen producing plant at his ranch here not far on the west side of the island, so where is the hydrogen going to come from and if it can come from a environmentally friendly place, if we could use let's say excess solar to be able to electrolyze water, store the hydrogen pressurized and use it as a fuel source, then it makes a lot of sense, then you also have the part of the equation in terms of you need fuel cell vehicles in order to use the hydrogen, so it's kind of chicken in the egg, who's going to bring over fuel cell vehicles here, and I know Hank very much wants to, if you don't have a fuel source or hydrogen fuel source, so with Hank of course he's got his own hydrogen fuel source, but not everybody can pull up tanks fueling station and fuel up, so the the availability of hydrogen here on this island at least has been extremely extremely limited, therefore those people who would be considering a Toyota Mirai which is a fuel cell vehicle or a Honda excuse me Hyundai Santa Fe because they also make you a fuel cell vehicle version of that SUV, you know they got to think okay if I bring the car over, which would be way cool and run off of hydrogen, where's it going to come from, where can I go to fill up and in California there are more and more hydrogen fueling stations, you can pull up a map and you can see little pins in the map across the Bay Area especially in the LA, LA greater LA area that there are places to go, but here on this island I know of not one single one that's publicly available and I know Surfco Pacific on Oahu they are putting together some rudiments of infrastructure system to be able to fuel up the Mirai that they're selling, but it's coming I think way too way too slowly, I don't know Stan Osman of course I know we talked about it last week actually and appears that the Mirai is going to go on sale and lease through I guess Surfco and it's going to be relatively cheap, it's going to be something just over $400 I think and it includes maintenance of course as lease cars do, but it also includes a supply of hydrogen up to a certain dollar amount through the course of the lease, so that's pretty good and of course you have to go out to Mapuna Puna I guess where they will have this facility and pick up your hydrogen, which could be a pain, however the original estimates of range on the Mirai have been exceeded and what I understand is that the Mirai is going to be doing like 340 or 50 miles on a fill up that's pretty terrific. The combination of EVs, which of course there are a lot more EVs than FCVs here in the state, but I mean I think it would be an agreement that transportation is the much more difficult not to crack in terms of really making it dent and having it go in a much more renewable, much more environmentally friendly. I have no doubt there will be more and more electric vehicles, I have no doubt there will be we're just seeing the beginning of fuel cell vehicles but unfortunately you know it's going to take time and I think gosh you know as a species and as a planet so we don't have as much time as we thought we had just a few you know handful of years ago. That's true, that's true, but you know remember there's a connection between these vehicles, the electric vehicles and the hydrogen electric vehicles in the sense that they can power your house and this one vehicle either here or coming that can actually do that can power a building and it's just an ordinary vehicle has a big supply of hydrogen and that has an effect on exactly you know how do we handle how do we handle blackouts if you had a supply of hydrogen to power your house then you're not as concerned that the utility is having a blackout because of a storm so this is this is all going to evolve but you know what Marco we've done it again we've taken a perfectly reasonable half hour and we have only talked about really two things or possibly depending how you count it three things and we've fritted away the time on these wonderful advances in clean energy in Hawaii and we have we have an agenda of two or three other things we haven't even touched so I guess we'll have to do this again in two weeks and try to catch up what do you think? So much to blab about Jay in so little time. Thank you Marco, Marco Mangelsorf Provision Solar and Hilo joining us by Zoom and we look forward to we look forward to further discussion on so many issues. Thank you Marco. Thanks so much for having me it's always a pleasure my friend thank you. Take care.