No geothermal royalties collected in Hawaii in 2020

No geothermal royalties collected in Hawaii in 2020 State Capitol of Hawaii, Honolulu (source: flickr/ Daniel Ramirez, creative commons)
Alexander Richter 8 May 2021

The state of Hawaii did not collect any royalties from the Puna geothermal plant in 2020, but with the restart of the plant this year, royalties should flow again.

The Department of Land and Natural Resources for the State of Hawaii recently submitted its report about geothermal development in Hawaii to the Hawaii State Legislature.

The yearly report covers the royalties the Department receives from geothermal and status of developing the interisland cable transmitting geothermal energy.

Due to the shutdown of the Puna Geothermal Venture (PGV) power plant on May 4, 2018 by a volcanic eruption along the Kilauea East Rift Zone (KERZ) and subsequent lava inundation of some of its facilities, PGV was unable to produce electricity during Fiscal Year (FY) 2020, so the report.

Therefore, no geothermal royalties were received in FY 2020, and statutory distributions to the County of Hawaii (30%) and the Office of Hawaii and Affairs (20%) were also $0 during this period. During FY 2020, PGV diligently worked to restore electrical production, with plans to have the power plant back online by the end of calendar year 2020. Existing geothermal wells were serviced/modified, and new wells drilled to provide for electrical production. PGV also updated its power plant infrastructure by replacing older power generation equipment with more efficient units and refurbishing electrical substations with the goal of efficient and clean energy production to meet their allowed energy projection limits.

PGV applied for and received two permits to modify (clean out) existing geothermal wells and two permits to drill new geothermal wells.

Currently, the Island of Hawaii is the only island [in the state of Hawaii] benefiting from geothermal development. Power generation from geothermal energy began in May 1993 and, on average, annually provided more than 25% of the Island’s power demands until the plant shutdown in May 2018 due to the KERZ eruption.

For the last full year of operation of the Puna Geothermal plant in 2017, the report for the Fiscal Year (FY) 2016-2017, the department reported  a total of $1,202,832.92 in geothermal royalties received from Puna Geothermal Venture (PGV). In accordance with statutory provisions, $360,849.88 (30%) was distributed to the County of Hawaii. Additionally, $240,566.58 (20%) was distributed to the Office of Hawaiian Affairs. Geothermal royalties for FY 2016-2017 were based on the power production and sale of 276,029 MWh to Hawaii Electric Light Company (HELCO) at an annual hourly average production of 31.5 MW. (report of 2017)

No program work was performed during the FY 2020 to effectuate the intent of this statute regarding an interisland deep water electrical transmission cable system.

How far the interisland deep water connection between islands in Hawaii are real is a bit unclear. A larger scale study to look into interconnection between Puna, Hawaii island, to Maui and Oahu, the more populated islands of Hawaii, seems to have been cancelled in the late 1990s.

Source: Department of Land and Natural Resources, State of Hawaii (DNLR, pdf) via HGGRC