Hawaiian Electric chooses REG to supply biodiesel for generation station testing

By | September 18, 2009
Posted October 14, 2009

Hawaiian Electric Company announced on Oct. 14 that it has signed a contract with a subsidiary of Iowa-based Renewable Energy Group Inc. to supply 400,000 gallons of renewable, clean-burning biodiesel to be used to conduct biodiesel operational testing and collect additional emissions data for the new Campbell Industrial Park Generating Unit.

REG emerged as the winning bidder from among eight companies seeking to supply the biodiesel for testing. As with all Hawaiian Electric fuel contracts, this contract has been submitted to the Hawaii Public Utilities Commission for review, as well as for input from the Hawaii Division of Consumer Advocacy, before the contract can be included in Hawaiian Electric's fuel costs.

"We are proud Hawaiian Electric has chosen us as a partner and look forward to helping Hawaii meet the goals of the Hawaii Clean Energy Initiative by providing high-quality biodiesel, which reduces life cycle carbon dioxide values by 78 percent compared to petroleum diesel fuel," said REG Chairman and CEO Jeff Stroburg. "The state is to be commended for its leadership in creating a model for other utility companies across the country to follow."

In August, Hawaiian Electric resumed the search for a biodiesel supplier for the Campbell Industrial Park Generation Station after the PUC rejected a previous contract with another potential supplier.

In addition to the 400,000-gallon contract, a second request for proposals to supply 3 million to 7 million gallons of biodiesel per year for two years closed on September 30, 2009, with the goal of completing a contract for PUC consideration by the end of November.

"We are grateful to all the bidders who responded so quickly and we are very happy to be working with Renewable Energy Group on this essential step in meeting our commitment to the PUC and Consumer Advocate to power the new peaking unit with renewable biodiesel," said Robbie Alm, Hawaiian Electric executive vice present.

"Being able to use liquid renewable fuels in our generating units is one of many steps-including more electricity from other renewable sources such as solar, wind, biomass and the ocean-to meet our goal of providing reliable electric service while reducing Hawaii's dependence on fossil fuels," he said.

In August 2007, the Natural Resources Defense Council and Hawaiian Electric established an environmental policy for procurement of biodiesel from sustainably-produced palm oil and locally grown feedstocks.
REG's response to the RFP proposes to supply high quality biodiesel processed from used cooking oil and waste animal fat. While the use of waste is not covered directly by the 2007 NRDC-HECO Environmental Policy, the NRDC has indicated that this is likely to represent a positive environmental approach as compared to other feedstock that may produced through unsustainable management practices.

The Campbell Industrial Park Generating Station consists of one 110-megawatt combustion turbine generator and auxiliary systems to be used as a peaking unit. Construction is complete and preliminary performance testing is underway.

REG operates a national network of biodiesel production with the capacity to produce more than 300 million gallons of biodiesel per year. As a member of the National Biodiesel Board, REG adheres to the industry's Biodiesel Sustainability Principles found at www.biodieselsustainability.com.

For more information:
HECO: Peter Rosegg 808-543-7780, 808-371-7474 [email protected]
REG: Alicia Clancy, (o) 515-239-8118, (c) 515-450-9692, [email protected]

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