Canada-based renewable energy developer, Innergex, announced last week that it has decided to cancel the power purchase agreement of its proposed Barbers Point Solar Project and will resubmit the project next year.
“Despite our best effort, this project is no longer financially viable under its current terms in the PPA. As such, we have informed HECO of our decision to not pursue the Barbers Point Solar Project under this PPA,” Innergex said in an email to community members Nov. 25.
The Barbers Point Solar Project, set to be developed in Kapolei on land owned by the Department of Hawaiian Home Lands, is a 15 MW solar and battery storage system that could power approximately 6,200 homes.
In December 2018, DHHL issued a request for proposals for renewable energy projects in Kalaeloa. In 2019, after reviewing the proposals, it selected Innergex because "the company offered the best compensation and community benefit package," according to the DHHL website.
Innergex cited several reasons for its decision to cancel the PPA, such as changing market conditions over the last few years, including price increases and supply chain issues, as well as regulatory delays and challenges with the regulatory framework.
“There have been recent challenges to the regulatory framework that, in our experience, does not allow the advancement of renewable energy projects in Hawaii in a timely, reliable, and efficient manner,” Innergex stated.
The company also added that the final cost requirement of interconnection by Hawaiian Electric was substantially higher than estimated during the PPA negotiations, which has affected the financial viability of the project.
Despite this, Innergex said it will resubmit the Barbers Point Solar Project in the Stage 3 RFP process next year.
“While we are unable to proceed under the current PPA, Innergex is hopeful that there are still future opportunities for this critical infrastructure through the Stage 3 RFP,” Innergex stated. “Therefore, we have continued to further crucial permitting efforts for the project.”
Stage 3 RFP is Hawaiian Electric's next big push to continue to meet Hawaii's renewable energy and carbon-reduction goals, according to a spokesperson for Hawaiian Electric.
"This third procurement stage differs from our first two in that it seeks both firm and intermittent renewable resources," a spokesperson for Hawaiian Electric told PBN in an email. "Unlike variable renewables, such as solar and wind, firm renewable energy is available on-demand at all times."
Hawaiian Electric opened the Stage 3 RFP for Hawaii Island on Nov. 21; the RFPs for Oahu and Maui are not open yet.
In a Nov. 22 letter informing the Public Utilities Commission about Innergex's decision, Hawaiian Electric said it "does not dispute Barbers Point Solar’s right to declare the PPA null and void."
"Although Hawaiian Electric is disappointed with this outcome, it respects [the] seller’s decision and will continue to work diligently to secure other sources of renewable generation," Hawaiian Electric said.
