Private Company Wants to Buy Utility on Hawaiian Island, Build Microgrids

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Pulama Lanai is in exploratory discussions with Hawaiian Electric to buy the electric utility’s assets on the small Hawaiian island and is looking to build microgrids at the island’s two hotels as a first step toward making the island’s energy sources 100% sustainable.

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Privately held Pulama Lanai was created in 2012 to manage Lanai’s resources after tech entrepreneur Larry Ellison bought 98% of the island for $300 million in 2012.

Pulama Lanai is the island’s largest utility customer and operates the Four Seasons Resort Lanai at Manele and the Four Seasons Resort Lanai at Koele, a Sensei Retreat.

The remaining 2% of the island is held by private home owners and government offices. Lanai is part of the county of Maui.

Pulama Lanai approached Hawaiian Electric about acquiring the utility’s assets on the island after Hawaiian Electric issued a request for proposals for renewable energy projects.

The acquisition talks are in the “very early” phase of “preliminary discussions,” Hawaiian Electric spokesman Peter Rosegg said. “It would take a lot of negotiation and the approval of Hawaii’s Public Utilities Commission to go forward.”

Since its inception, Pulama Lanai has sought to create a “sustainable future” on Lanai, the company said in a statement. That has included improvements to the water system, recycling programs, native and endangered species protection and resource conservation. ‘Our journey towards 100% sustainability now leads us to investigate the potential benefits of owning the grid,” the statement said.

In its movement toward being “energy independent,” Pulama Lanai’s plan includes more renewable energy and lower electricity bills for residents, who now pay rates that are among the highest in Hawaii. The “initial transition phase” toward a sustainable future will include creating microgrids with the Four Seasons resorts at Manele and Koele, Pulama Lanai said.

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“We will be meeting with the Lanai community, Hawaiian Electric, the PUC and other groups as we move forward with discussions, and we are committed to working collaboratively with Hawaiian Electric on executing the transition as seamlessly as possible, should we receive approval to move forward,” Pulama Lanai said.

A spokeswoman for Pulama Lanai said it was too early to provide details about the components of the planned microgrids.

The discussions between Pulama Lanai and Hawaiian Electric began after Maui Electric (now known as Hawaiian Electric) issued a request for proposals for 9.5 MW of solar-plus-storage resources on Lanai on land owned by Pulama Lanai.

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Because of the discussions, Hawaiian Electric is working with the Public Utilities Commission and other stakeholders on possible revisions to the RFP.

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