It has become abundantly clear over the past couple of years that energy transition isn’t going to be a straight line leading directly to abundant carbon-free power and a net-zero world. All sorts of obstacles have popped up, indicating that the energy industry’s trilemma of availability, reliability and affordability not only clash with each other, they can also conflict with environmental priorities. The challenge is being felt now in Hawaii, where a commitment to expanding energy production from renewable sources and tamping down the use of fossil fuels while also keeping prices under control and reducing pollution is turning out to be no easy feat. In today’s RBN blog, we look at Hawaii’s recent efforts to phase out coal- and oil-fired power generation, why that’s turned out to be easier said than done, and what it all means for environmental performance and energy prices.
In many ways, Hawaii exemplifies both the ambitions and pitfalls in today’s energy landscape. The sharp contrast between the state’s environmental bounty and its energy needs is vividly exemplified at a spot called Kahe Point on the west side of Oahu, the most populous of the Hawaiian islands. Nicknamed “Electric Beach,” (yellow star in Figure 1) the area’s abundant sea life — including reef fish, sea turtles, eagle rays and even pods of spinner dolphins — attracts scores of divers and snorkelers, but much of that underwater beauty is a result of the warm water that flows from the cooling pipes that extend from a nearby power plant, which runs on fuel oil. So why does a state with such a strong environmental drive perpetuate the plant on the otherwise pristine coastline?
Let’s start with a look at where things currently stand in the Aloha State, where a transition from fossil fuels for power generation has long been a priority for environmental and economic reasons. In many ways, the energy landscape there remains a state of extremes. Even though Hawaii has the third-lowest energy consumption per capita of any state, according to Energy Information Administration (EIA) data, it uses almost seven times more energy than it produces, a result of its small size and lack of resources. (It has no oil, gas or coal reserves. Renewables are responsible for about 15% of utility-scale power generation, with imported oil responsible for nearly all the rest.) Solar power (including rooftop panels) meets about 17% of the state’s overall electricity needs, which puts it 10th overall in that category, but petroleum-based products account for about 80% of the state’s total energy consumption (including transportation), which is the highest in the U.S. And then there’s the bottom-line number that resonates with residential consumers, businesses and politicians alike: the highest electricity prices among the 50 states.
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