Hawaiian Electric seeks offers for Oahu wind projects
Hawaiian Electric Co. (HECO) is looking for shovel ready wind project on Oahu that could be built in time to take advantage of the federal production tax credit that expires in 2019.
HECO is seeking responses to its expression of interest by no later than Jan. 31, 2017.
HECO says the responses it receives may help inform a more formal request for proposals or an alternative means of procurement.
Hawaii is unique not only for being the only island state, but for also being the only state that aims to power its facilities completely with renewable energy resources. In 2015, the state adopted a 100%-by-2045 renewable portfolio standard.
The state’s main utility not only is looking to meet that goal, but to do so while keeping rates for customers as low as possible. To help in that effort, Hawaiian Electric is seeking developers able to put up wind farms on Oahu before the 2019 expiration of the production tax credit.
The federal incentive pays $0.023/kWh, but steps down over the next several years. For projects entering construction in 2017, the PTC is reduced by 20%. For projects beginning construction in 2018, the incentive drops by 40%, and then is reduced by 60% for projects that start construction in 2019, the last year the PTC will be available, unless it is renewed by Congress.
The PTC helps keep wind power prices low by lowering capital costs for developers.
HECO is looking for projects that can be online by the end of 2022 and that are capable of producing at least 5 MW.
“The potential capacity for additional wind power on Oahu is limited and land costs on this island are significant contributors of renewable projects pricing, so we believe it is important to identify ‘shovel-ready’ projects that can take advantage of the federal tax credits as the cost of such projects will likely be higher in the future,” said Shelee Kimura, HECO vice president for corporate planning and business development, said in a statement.
- Hawaiian Electric Co. Share Hawaiian Electric seeks onshore wind farm developers on Oahu
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