Houston-based Zilkha Biomass Energy could begin delivering its proprietary black wood pellets to Hawaiian Electric in as soon as 18 months after utility commits to purchase agreement, according to company filing

Allison Oesterle

Allison Oesterle

Dec 10, 2013 – Industry Intelligence

LOS ANGELES , December 10, 2013 () – Houston-based Zilkha Biomass Energy could begin delivering its proprietary black wood pellets to Hawaiian Electric Co. in as soon as 18 months after the utility commits to a purchase agreement, according to a recent filing with the Hawaii Public Utilities Commission, Pacific Business News reported on Dec. 4.

For each unit it converts to run on Zilkha’s black pellets, Hawaiian Electric could save about US$40 million per year in fuel costs, Zilkha Biomass Energy added.

Hawaiian Electric’s power stations will initially use biomass fuel produced at wood pellet plants in British Columbia but could eventually be fueled by black pellets made from locally cultivated agricultural feedstock that is converted at an instate production plant, said Zilkha Biomass Energy CEO John Holmes Jr.

Zilkha Biomass Energy first signed a letter of intent with Hawaiian Electric in August after introducing its black pellets to the utility and the Hawaii Public Utilities Commission in late February.

Initial feasibility studies have been extremely positive, according to Zilkha Biomass Energy, which noted that Hawaiian Electric will likely be presented with a final feasibility report by the end of 2013.

In comparison to alternative options, switching to black pellets from fuel oil will allow Hawaiian Electric to more quickly accomplish its goals of lowering ratepayers’ electric bills, reducing its fossil fuel consumption, and meeting the 2015 Environmental Protection Agency air emissions regulations, Holmes said.

Holmes noted that Hawaiian Electric's capital expenditures would also be lower than if the company chose an alternative option.

The primary source of this article is Pacific Business News, Honolulu, Hawaii, on Dec. 4, 2013.

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