Honolulu-based Hawaii Gas, the state's only franchised gas distribution utility, took its first shipment of containerized liquefied natural gas (LNG) on April 2. In what are projected to be regular shipments from the mainland, Hawaii Gas will use the LNG as a backup for its synthetic natural gas (SNG) operations.
Newport Beach, CA-based Clean Energy Fuels Corp. said it supplied 7,100 LNG gallons to the Oahu SNG plant. The Hawaii Public Utilities Commission (PUC) earlier this year approved the LNG shipments to the utility, a unit of Macquarie Infrastructure Co. (see Daily GPI, March 11).
The first shipment arrived via a 40-foot International Organization for Standardization (ISO) container aboard a conventional container ship from the U.S. mainland on the West Coast. It was delivered to Hawaii Gas' Pier 38 gas receiving facility where it is being regasified using mobile vaporization equipment and then being injected into the SNG distribution pipelines.
Hawaii Gas received state PUC approval for the LNG shipments as a backup for its SNG operations, but it is exploring other LNG programs, including a small-scale containerized LNG delivery program and a larger-scale bulk LNG program with Hawaiian Electric Co.
Although the source of the larger LNG shipments from the U.S. mainland has not been publicly identified, sources at Clean Energy have confirmed their company, which produces LNG at several facilities around the United States, was competing to be the supplier for the longer-term projects.
Regasified LNG and synthetic natural gas are virtually identical. Hawaii Gas has an application pending at the Federal Energy Regulatory Commission seeking authorization to operate facilities that "will be used to receive, unload, load, store, transport, gasify or process natural gas that is sourced on the continental U.S. and transported by waterborne vessel to Hawaii."
In a phased program, Hawaii Gas has said it intends to build the eventual capability of supplying gas for up to 75% of its customers' requirements, and providing fuel for up to 400 MW of power generation facilities and for industrial and other commercial applications.
Last year a study at the University of Hawaii concluded that LNG could cut oil-based energy bills in Hawaii substantially during the next 20 years (see Daily GPI, Jan. 9, 2013).
Hawaii Gas CEO Alicia Moy said her company is "committed to lowering energy costs for Hawaii," noting that natural gas is part of the state's effort to use cleaner energy. "The sooner LNG can be brought to Hawaii in large quantities, the sooner our residents can benefit from this cleaner, cheaper, reliable and abundant fuel."
Clean Energy's Brian Powers, vice president of LNG production, said natural gas "again has proven its versatility by meeting the fueling needs of Hawaii Gas in an economically and environmentally friendly manner." The LNG was produced at Clean Energy's Boron, CA facility.