 We're back. We're live energy 808 the cutting edge with my co-host, if you will, Marco Mangelsdorf, a provisional solar in Hilo, and Senator Russell Ruderman, a state senator in the Hawaii legislature. Welcome, you guys. So nice to have you here. Hello, thanks. Nice to be here. So let's talk about something. Let's follow up on something that Marco and I've talked about before. Hujo Nua. Okay, Hujo Nua has been around the block for a very, very long time. In fact, it's one of those projects that have sort of lasted forever. As a matter of fact, it's one of those projects where the environment, I mean, not only the environment up in the air, but the environment legally, socially, economically has so drastically changed that it has been overtaken by events in every way you can imagine. And the Supreme Court, I guess it was an appeal by Life of the Land with it, they turned around an approval by the PUC and referred it back to on remand to the PUC. And the PUC thought about that for a while, decided no permit can't do this project. This does not satisfy our environmental standards, air quality, you know, emission standards, okay, and they said no. And now it's up for reconsideration, a motion for reconsideration by the capital concentration that has been trying to put it together, who say they have invested 350 million American dollars. Okay, so Russell, you wrote a letter to the PUC about this, and that is something with the state senator writes a letter. What did you say in the letter was last week, wasn't it? It was actually about five days ago, I think. You know, another senator had written to the PUC something that I took great issue with, who doesn't live on the big island, it was giving incorrect information that has been circulating around here, and I wanted to correct. So I just wanted to point out to, as the PUC well knows, I wanted to let them know that some of us senators and some of us big island ratepayers are aware that this project would increase our rates unnecessarily. And the reasons that they were told to reconsider it were completely valid reasons that benefit here on the big island. You know, you mentioned the environmental concerns, but I think the thing that got sent back to the PUC was an exemption from competitive bidding, so that they didn't have to compete, you know, electrically. And you hit the nail on the head, Jack, when you said the environment, there's pain, the environment around the end, sectors changed so much because now we have solar plus storage at the utility scale, and it's much, much cheaper than we could imagine 10 years ago when this project started. And so to allow it to come online at this without ever having had competitive bidding on behalf of us ratepayers was just improper, the wrong thing to do. And I believe that the Supreme Court also said that the PUC had failed to consider, you know, environmental costs. So those are two things. I don't know which one sent it back, but so I wanted to point out that there's a disinformation campaign going around that my colleagues, for example, use the phrase costlier intermittent solar than this green facility. And it's like there's so many falsehoods built into that one statement, because our new solar is not intermittent, it's not costlier, and this plant isn't green. And we don't want it, you know, I understand the big, the big argument now in favor of it is jobs. We all want jobs, you know, but do any certain set of jobs justify raising the rates for all big island people who already pay the highest rates in our state and suffer from the worst poverty? Is it really right to raise the rates or anybody because of one company's desire to have those jobs? Or, you know, is that a shared burden that we all have? Not to mention the environmental costs, which has also changed since they started. I mean, when this project started, I thought, yeah, seems a good idea. We got to do something with those trees. Let's burn them, frankly. And I stayed out of it. And then along came Greta Thunberg and the realization climate crisis they're in. And we cannot hear on our big island embark on 30 years of not only cutting down the trees that are the carbon sink, but then burning them to add carbon to the air. Pretending that's carbon neutral doesn't make it carbon neutral. It's a disaster for our climate carbon. So there's two giant reasons why we can't allow it to proceed. Their exemption from competitive bidding apparently was never legal. So, you know, the blame for the failure at this point in time has to be shared all around. Yeah, well, good for you for speaking out on that. I hope, you know, it has an effect on things. I believe it will have an effect on things. At the end of the day, it's not good for Hawaii. It's not good for the big island. And these guys should have known going in or at least somewhere along the way that the project doesn't work. The technology is old. The technology is not efficient. Somewhere along the way, must become obvious to them. Marco, you have specific thoughts about this too. What are your thoughts? I do. I do. And I just want to reiterate my support to Russell and to Henry Curtis because there's a very, very small number of us who have had the temerity to speak out publicly in support of this decision and order by the commission of several weeks ago. The folks at Huohonua have done a masterful job essentially running the table, so to speak, using Las Vegas terms in terms of getting their message out and having journalists that cover it just the way they would like, which is to like Russell was saying, focused on jobs. And every few weeks, it seems the Huohonua folks trot out a new number of how much they've spent. Not too long ago was 330 some odd million. Last week, it was 400 million. Who knows what is going to be this week or next week. And this has been an odyssey going on for close to 10 years now, close to 10 years. And I think back to what if Helico had taken an off ramp two years ago, five years ago, eight years ago. Then, you know, where would we be now, I think we'd be better off and I don't want to do too much, you know, kind of morning, morning quarterbacking here. But at the same time, I just can't, from any perspective, see this is beneficial to to ratepayers and to the people of this island, the people of the state. And something that has received zero attention, gentlemen, zero attention is who's behind this project? Where's the money coming from? It is completely from what I can tell completely opaque. If you go to the BREG, the business registration website, DCCA, there are no clues to follow. There are so called foreign foreign company, okay, foreign meaning outside of Hawaii, with some type of Delaware pedigree perhaps, to some degree. But I've had people a lot brighter than I am who have spent some time trying to dig into the money, the money trail, follow the money, you know, that famous saying from Deep Throat back in the days of Woodward and Bernstein, in terms of the Nixon corruption. And it seems to me that with one of the major biggest infrastructure projects of this island in decades, that there should be some greater clarity and transparency in terms of where's the money coming from? Who is behind this beyond their propaganda campaign? Marco, we're going to take a short break right now. We'll take a short break and do some public service announcements and then we'll be right back. Okay, we're back with Energy 808, the cutting edge. Okay, Marco, you were expressing some thoughts about what this all means in a larger context. Please continue. Yeah, just focusing on the money trail, Jay, that, you know, if you take who and what at face value, okay, they spent 400 million bucks, that's quite a bit of money. Who is behind it? Which investors under what terms? I mean, Henry Curtis has tried on a number of occasions through the docket, through IRs information request to try to dig into and get information from who Honeua. Who Honeua has blocked, blocked, blocked every attempt that I know of. Oh, saying it's not pertinent, it's not relevant and they refuse. So we've got a number of local people. Warren Lee, former president of Helco, someone I've worked with over the years, a number of years ago, who are out there bashing the commission using words such as were appalled, Warren saying I'm appalled at what the commission did. I've never seen in the 20 years I've been in the arena here, I've never seen the type of personal, seemingly personal attacks from these parties to the commission. And I find that to be is it a sign of the times in terms of the dialogue is degrading to the point of you don't like a decision you go after in somewhat offensive terms. When you have a decision you don't like, I don't know. I don't know, but it's deeply disturbing to me. On the merits, it was absolutely the right decision. Who Honeua has the right to ask for reconsideration, which they did last Monday, the commission has said we are leaving open until August 10th, August 10th, the end of is that next week, or approximately two weeks from now for any commentary. And I can guarantee you they're going to be person after person, who is going to be sending commentary to the commission saying we support jobs, we support jobs, we support jobs. So I expect the commission will issue a decision or within a fairly short amount of time, most likely reaffirming their original decision. And then it's okay, what's the next step? What's the next year to fall? And it's quite possibly going to be a lawsuit. So crazy times we live in. Crazy times you live in. Russell, you had more on this too. Well, it's something that Marco said reminded me of some of the other fact that it is in fact, not a local company, but a quote, foreign corporation unquote, because this big part, I mean, I live here in East Hawaii and I read the paper and the PR campaign is the PUC is some outsiders that why, why does the PUC from Honolulu control following what we do here on the big island. And, you know, while I sympathize with that, sometimes it's nonsense in this case, because first of all, this is a foreign corporation trying to get around our laws here on the big island. And let's remember who the PUC is. It's the public utility commission. They're on our side and they're in Honolulu because it's a state-wide commission. The PUC is defending our rights, or me and whoever is behind Honolulu, but they are not defending our island or our interest, the PUC. So it's just doubly ironic the way they, the way they, as if the PUC was this evil outsider. So what's going to happen on this motion for reconsideration? I'm, you know, motions for reconsideration are not easily granted in courts or in the PUC. You have to really come up with some compelling stuff. Do you know what that stuff is here? And is there any chance that the PUC will, will reverse themselves? Let me, let me get my crystal ball here. Hold on guys. I'm just going to reach over here. See here's my crystal ball. Thank you. It's always helpful. Yeah. I'm closing my eyes for a moment and I'm dividing, I'm dividing here. So, so the ball says more than likely the commission will reaffirm its decision. That's what the ball says. Yeah. Well, you know, in a motion for reconsideration, you have to come up with compelling reasons and things that the court may have, or in this case the PUC might have missed. And, and that the circumstances warrant a complete change of heart. I don't know why that would be the case. This has been something they have very, very carefully considered. And it's in, it's in not to refer to your crystal ball, but it's in a goldfish bowl. There's been a lot of press about this. It's not like, oh, they might have missed something. I don't think so. This sounds like re-ashed from what Russell says the, you know, the basis for the reconsideration and for any publicity now is just going to be rehashed and it's not going to be persuasive at all. So let me ask you guys, what happens now? Let's assume for this discussion that the PUC, you know, affirms its early decision that it denies the motion for reconsideration. What happens? What happens to this project? It's mysterious investors. What happens to jobs that they're talking about? What happens to energy on the big island? Well, what happens to the plant? I mean, I hope the plant can be repurposed. Energy on the big island will be just fine. We, well, we lost punitive thermal venture a year and a half ago, and we have not had a power outage as a result in all this time. So we had plenty of reserves, and now we're very close to a couple of new large solar plants coming on. That's for important. So, you know, as far as do we need this project or anyone project to keep our lights on? No, we don't. We're fine. And our rates are better without it. Now, as for what happens to the investment in the plant and the jobs, I'll let Marco answer that because he seems to have better sources of improvement. And he's got his crystal ball just in case. That's what... What's your answer to that? What's going to happen, Marco? What's going to happen, most likely, again, as I peer, think about the crystal, is that if you're who, Honu, and you've already spent 400 million, and you've engaged law firms right and left, and you're spending what you spent, and you'll continue to spend what you need to spend to see the suit to the end, whatever the end is going to be, is that there will be a suit filed in the Hawaii Supreme Court alleging that the commission did not follow A, B, and C. And as far as I understand the law, Jane, correct me if I'm wrong, they cannot argue that the decision was substantively incorrect, but they didn't follow the directions of the earlier Supreme Court decision. They didn't follow procedure. Yeah, this would be an appeal from the decision, the POC on remand. So it's whatever is in that decision and order by the Supreme Court, remanding it is what will be tested if these guys want to file another appeal. Correct. So it would play out in the court for who knows how long another eight, twelve months, and if and when the day comes, when the last, truly last nails of this coffin gets pounded in and the door is shut, then what makes the most sense is you start parting out the equipment. You start trying to get some type of value for the investments you've already made. And will you get as much as what you put in? No, that's not the way of things, but you want to get something out of it and you write off whatever you can. I mean, whenever you're talking about $400 million worth of investment, you've got a heck of a lot of smart accounts and lawyers to be able to do whatever you can. But it sounds like a dead loss. You know, Russell, you said maybe it can be repurposed, but this is burning. I mean, it's got a nostalgic quality of better, like the cane fields of your, maybe some people feel that, oh, the smoke from the cane fields was okay. Therefore, this is okay. Not true anymore. But the question is, how can you repurpose a facility that costs a lot of money from burning things to some other process, some other technology to yield clean energy that doesn't give this kind of emission? So I don't know that there is such a repurposing as that, but let's say this facility, crack me if I'm wrong, Mark, this was already repurposed. It was the sugar, helo-coast sugar processing mill, right? It was a sugar burning facility. At one time, it was a repurpose to burn trees. Now, I don't know. Just one small correction here, Russell. So during the cane days here on the island, which of course went on for many, many decades, where sugar cane essentially dying in the 1990s, there was a big gas burning plant, correct. And then they shifted over to coal. They brought coal in from great distances. And helo-coast processing company, power company, was burning coal up until I believe it was 2006 or thereabouts. And then they shut down burning coal. And then it would light and follow essentially until Hujo Nua said, we can burn something else in this plant and make money doing it. Thank you for filling in those gas, Mark. I did not know. So I mean, it's already a repurposed facility apparently twice over now. So I mean, I don't know what they're going to do with it. And the big looming, first of all, I'm sure that Hujo Nua or Hujo Nua is not looking for ideas for what to do with their facility yet. They're going to, like, fight for another year and wouldn't be interested in any ideas. But at some point, we have to figure out something to do with some of the things. It's long been said they're not the right type to make plywood out of. But if there's some construction material that could be made out of it, that would be a valuable thing to do with those trees if you would. As you said before, it's not likely they'll be able to recover their investment. It's not likely this will be worth what they thought it was worth after making that huge investment. Well, of course not. But when people take an investment that involves a risk including legal risks that they know are unsettled questions and exemptions and fast tracks that they've taken along the way, that's part of the risk that they're knowing in the book. It's not our fault at that risk. And it's not our responsibility. Well, you know, let me ask you a tough question though. And this just goes back to it goes back to Superferry and TMT and all that. So these guys were led into, or they're going to say, they have said I'm sure, they were led into making this investment. And they went through and they dotted their eyes and crossed their T's and all that, and they invested all this money over a long period of time. Okay. And it came apart sort of the same way Superferry came apart and the same way TMT in my view is coming apart. So the question is, what message does this send to the investment community? Let's assume that with an amount of 350 or 400 million dollars, Wall Street had to be involved. So what message does this send to Wall Street? Are we concerned, should we be concerned, maybe not care about what message goes and what Wall Street is going to do the next time we seek big capital for a big project, any project? Let me take a shot at that if I could. And then I'll let you hear what Russell says. So Wall Street is already, Jay, running away from combustion generation. They're already, the money, the money is following renewables that is cleaner than burning stuff. It's already happening. So Wall Street is taking away, would take away from what's going on, that investing in combustion generation is not a good idea. And that frees up money and capital to go to where it needs to go. Russell, would you add anything to that? I would say, I'm not the expert on this, but the idea that they dotted every I and crossed every T at every point along the way, I think can be challenged. I'm not sure that it's all as one sided as that. But I will say that, I don't agree that we ought to be leading any investor down the Rosie Trail and then leaving them at the altar and say, we changed our mind. I don't agree with that. I'm a business person myself. I don't. I think that it's terrible. That shouldn't be our outcome. But the companies and the developments that tend to succeed or will succeed in the future are proposing welcome developments that are community supported, not forced over the will of the community. I've had experience with this. So maybe the message goes out is what we want in development in Hawaii is things that are good for Hawaii. And I think that message can be useful. I am not justifying the massive loss of money that some corporations may have when it happened. But they're playing on this level. And as Marco said, they're playing with fire, no pun intended. And they know what they're doing. You know, I think what you just said is really the center point of this whole discussion. Because what I want to ask last is what have we learned from this? And I would take from what you said, Russell, this is really an important point. If these guys, these developers, investors come to Hawaii, they have to include in their thinking whether this project is going to be found good for Hawaii. It doesn't even matter about the law, although the law certainly counts. They should ask themselves on an ethical level, is this project going to be good for Hawaii? Because we are small and we are fragile. And we are not all that sustainable and resilient. We have to watch out all the time that we don't lose touch with our own future. And so if they don't figure that out at first, it could happen this way where they find out the hard way. And I think you can find other examples of that. What's your reaction? And the question, Marco, is what have we learned from this? What have they learned from this? What should they have learned from this? I'll let Russell. No, I like the words of the previous speaker, Anderson, the journalist. I'm sorry, Jay, who is learning what? Are you asking me? I'm talking about the developers here. I'm talking about the investors. I'm also talking about Hawaii in general. I'm talking about the government. I'm talking about the PUC. What are the lessons? It's truly, in many ways, a disaster. Because they came, they saw, and they were conquered. And so what have we learned? What have we collectively, cumulatively, as a community around energy? What have we learned? We've learned that with the risk of being somewhat glib here, but very accurate nonetheless, is that we live in very uncertain times. It wasn't that long ago when investing in the tourism here in a hotel or renting out your room for Airbnb was pretty much a slam dunk, because we were 10 million tourists last year and rising. We're going to be 10 million something this year. So I mean, welcome to the new world, welcome to the new world of uncertainty. So I don't have any, I'd be in a different place in my life and in the world if I had answers to what do we do, what do we learn? But to me, Jay, it's learning that the degree of uncertainty that our species are very hubristic, sometimes arrogant, proud species has really been taken down quite a number of notches these past months, speaking very personally, and also looking at the macro level. So it's really a brave new world in terms of living and investing. And I choose to see this as a tremendous opportunity. And we have several more months to a rather dramatic election where the people will speak on multiple levels. And I think we're at a, we're approaching a very positive turning point on multiple levels. I sure hope that's the case. I choose to be more optimistic and hopeful than the standard like that it's all coming apart. Hope not. But we're at an inflection point for sure. And this coming election will be an inflection point for the country. And so Russell, I would ask you, we are at a time when people ask us to reimagine our economy or reimagine our mono economy as a tourist economy. And there are lessons in what happened here. It's the question of managing investments that come in. And of course, of investors, as I mentioned before, who should be watching to see that what they're doing comports with the quality ethical requirements of the development of our state, which may be changing right now. So how does this all play in the reimagination of our state of tourism, of diversification, of technology? How does it all play? What are the, what are the points we can carry home out of it all for the future? Well, that's actually a question. No, I think we all can see that how big goals should be getting away from our dependence on tourism. It's going to be painful in the short term to do that. If we can't find the will to really support the people who lose their jobs over the paradigm shift, that's going to be really painful. But I can't find a way to support them. I do think, you know, I've, I've, I've been business. I've been accidentally successful in business by focusing on the basics. I thought the food business would be a good place to be because every day over and over again, you know, it's just, it's just a human regular thing. And it's been successful. So my point is, we've so long imagined tourism is going to make us so wealthy or if chatting high tech is going to make us wealthy or some things, some high-minded thing is what we need. In my opinion, we need to view everything that we do in the future through the lens of what benefits the population of Hawaii. And when we do that, we'll, I think, obviously focus on three things. One's education, one's healthcare throughout Hawaii, and one is agriculture and food. And those are the, we have lots of cake, we have lots of seniors, we're going to need a lot of healthcare, we're going to need a lot of food production. There's a tremendous economy to be had supporting our own population like every place used to do everywhere else, you know. And so if we simply focus our priorities through those lenses, what is it that the people that live here need? Let's support that and make it better and we'll have better healthcare, we'll have better education, we'll have better agriculture. And then we don't really care if there's a peak in value in tourism. So who is going to implement these priorities? I don't have the answer to that. I kind of gave up my elected policies because I don't see anybody allowing these kind of things to happen right now. I don't have a way politically to make that. Oh, but you have, you have the power of the pen, such as that letter last week, and you certainly have the power of coming around think tech. And you know, Marco, if you didn't know, Russell Ruderman was a host for quite some time on think tech. And so when you, when you have more free time on your hands, Russell, the door, the door, she is always open, you know. Thank you. I enjoyed it very much. Another world of zoom. Yeah. Okay. So Marco, we're about out of time. Can you, can you thank Russell? And can you sort of come up with some wisdom necessary to, you know, to wrap up on this show? Well, listening to my friend Russell a few moments ago, got me thinking, man, God, why, how come this guy isn't running for mayor? You know, you have my vote in a hard beach, you know, and I know you've been in the arena there for as long as you, you have Russell and you got some plenty wounds and scars. And it's not your time now to, to run for mayor. But I was thinking, he's the guy I want to replace Harry Kim, you know, but not, not this time, not this time, you know, Russell and I will continue our odyssey together. And who knows where, where the path may lead. So thank you so much, Russell, for joining us. Thank you, Marco. Thank you, Russell. Great to see you. Appreciate it. Let's circle back. Thank you so much. Aloha.