Natural Gas
$2B Hawaii LNG Power Plant Build on Oahu Is Eyed
Hawaii is seeking new power delivery alternatives to its aging oil-fueled steam generators such as the 650-MW Kahe plant on the southwest coast of Oahu, which has operated since 1963 and provides 25% of island energy,
Tokyo-based JERA Co. has an energy proposal for Hawaii—a 500-MW hybrid combined-cycle and simple-cycle power plant on Oahu, supported by an offshore liquefied natural gas facility. The estimated $2-billion project plan by Japan’s largest power provider follows its agreement with state officials last October as part of Japan's commitment to the Trump administration of new U.S.energy investments,
JERA's plan aims to replace aging oil-fired generation on the island, which it claims will cut energy costs by an estimated 20%, but opponents say it moves Hawaii away from a previously stated goal to eliminate fossil fuel power by 2045 and adds new risks.
JERA has at least partial ownership in 10 power facilities in the U.S. and agreed in 2025 to boost LNG purchases here through deals for up to 5.5 million metric tons per year, over the next two decades, from providers such as Sempra, NextDecade and Cheniere. Hawaii energy providers canceled plans to build an LNG import terminal a decade ago to avoid long-term impacts on costs and carbon emissions from a fossil fuel commitment.
Gov. Josh Green (D), noting growing state power demand and need for a "bridge fuel," said the JERA proposal “represents a transformative overhaul of our electrical grid and a tangible step to move Hawaii from its historic dependence on oil, while bringing billions of dollars in new energy investments to the state.” John O’Brien, JERA Americas CEO, added that it "presents a path to reduce costs for residents and businesses, strengthen reliability and support Hawaii’s clean energy goals.”
Earthjustice claims the JERA plan could raise costs for Hawaii consumers, citing alleged mathematical errors in the proposed project’s cost-benefit calculations. Matthias Fripp, director of global policy research at clean energy think tank Energy Innovation and a former University of Hawaii electrical engineering professor, told state legislators at a hearing last month that mistakes in a Hawaii State Energy Office study “artificially inflate the benefit of LNG by at least $1.2 billion.” The office and JERA both dispute his claim.
“Hawaii Gas supports efforts to fortify and develop a pipeline infrastructure network that will be able to deliver the decarbonized fuels of the future, including renewable natural gas and hydrogen that we currently blend into our fuel mix on Oahu today,” said Alicia Moy, Hawaii Gas CEO.
About 75% of the JERA investment ties to the new gas-powered facility set to be built in Kapolei, about 20 miles west of Honolulu, and the remaining portion linked to LNG-related infrastructure, including a floating storage and regasification unit. Commercial operation is targeted for 2030. JERA said it plans to start the permitting process in the “coming months.”
Meanwhile, Hawaii's Public Utilities Commission last month approved an estimated $2-billion plan by state utility Hawaiian Electric Co. to replace six aging oil-fired steam generating units at Oahu’s Waiau power plant with new fuel-flexible, simple-cycle combustion turbines totaling 243 MW. Plant operation dates to 1938. The project is set to be completed in 2033, but utility and state officials are disputing the cost impact on ratepayers and other project issues.
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