The Hawaii Public Utilities Commission (PUC) has approved an amended power purchase contract between Hawaiian Electric and Wailuku River Hydroelectric on Hawaii Island. The Hilo-based hydroelectric plant, which has been generating up to 12.1 megawatts (MW) of run-of-river energy since 1993, will sell power to Hawaiian Electric at a fixed rate of $0.07 per kilowatt-hour under the new contract.
This updated rate, one of the lowest for renewable energy in Hawaii, is expected to save customers approximately $2 million annually compared to the previous rate of $0.20 per kilowatt-hour. The original contract, approved in 1991, expired in May 2023, and despite the expiration, Wailuku River Hydroelectric continued operations under the old terms while the new contract was being reviewed.
The second amendment, approved this month, extends the contract to May 2028, providing time for further negotiations. The updated contract moves away from the older “avoided cost” contracts that linked energy rates to fluctuating oil prices. Since the law changed in 2009, new renewable energy contracts are based on fixed pricing, providing stability and predictability.
Similar contract updates have been made with Puna Geothermal Venture and Hawi Renewable Development. Additional efforts on Hawaii Island include a contract signed with AES Hawaii for power from its Keamuku Solar + Storage project, expected to be operational by 2030. Furthermore, Innergex Renewable Energy, Inc.’s Hale Kuawehi Solar and Battery Storage Project in Waimea began operations, generating up to 30 MW supported by a 120 MWh battery system.
In 2024, renewable sources accounted for nearly 59% of the island’s electricity, underscoring Hawaii’s commitment to renewable energy and sustainable power solutions. This reflects broader efforts to reduce reliance on fossil fuels and stabilize energy costs for consumers.
