Company Profile An introduction to Hawaiâ€˜i Gas
CONTENTS Facilities & Locations
Who We Serve
Renewable Natural Gas
Liquefied Natural Gas
History of Hawaiâ€˜i Gas
Founded in 1904... Hawai‘i Gas is the only government Our company serves Hawai‘i’s franchised full-service gas utility, homeowners as well as the many processing and distributing gas businesses, high-rises, and organizations products and providing related services requiring clean, lower cost energy to in Hawai‘i. The company’s primary deliver their products and services to our products are synthetic natural gas community. (SNG) and propane (LPG), both of which For more than a century, the energy provide cost-effective and clean energy professionals at Hawai‘i Gas have solutions for a variety of residential and worked to ensure the people of Hawai‘i commercial applications. Hawai‘i Gas is continue to enjoy the benefits of gas also using liquefied natural energy. True to our gas (LNG) in Hawai‘i to motto — The Clean diversify its fuel supply Energy Company — We believe that our Good increasing reliability to Energy, from the products we we work to promote its SNG utility customers innovative uses and provide to the communities on O‘ahu. It is also technology for our we help build, delivers a exploring opportunities products to be a brighter future for the people to incorporate renewable leader in Hawai‘i’s of Hawai‘i. natural gas (RNG) from clean energy future. biogas as another clean We do this and renewable fuel for the state. by embodying our philosophy of Hawai‘i Gas provides gas service “Good Energy” in everything that in two ways: a regulated gas utility we do. We believe that our Good and a propane tank and cylinder Energy, from the products we provide to delivery service. The gas utility serves the communities we help build, delivers a its customers through underground brighter future for the people of Hawai‘i. pipeline networks, and is regulated by Because, whatever the need, we bring the Hawai‘i Public Utilities Commission. good energy solutions.
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FACILITIES & LOCATIONS Remaining true to our pledge for excellent customer service and supply reliability, Hawai‘i Gas maintains offices and reserve supplies of gas in storage facilities on all major islands in Hawai‘i. Kaua‘i Office Nawiliwili Propane Storage Moloka‘i Office Maui Office Kahului Propane Storage
Barber’s Point Propane Storage Propane Distribution Facility Synthetic Natural Gas Plant Pier 38 Propane-Air Backup
Lana‘i ¯ Office
Waimea Propane Storage
Hilo Office Hilo Propane Storage
Kona Office Kona Propane Storage
Ka‘¯u Propane Storage
CONTACT Corporate Headquarters 745 Fort St., Ste. 1800 (808) 535-5900
Kaua‘i Branch Office 3990 Rice St. (808) 245-3301
Kona Branch Office 74-5564 Kaiwi St. (808) 329-2984
Moloka‘i Office P.O. Box 157 (800) 828-9359
O‘ahu Branch Offices 515 Kamake‘e St.
Hilo Branch Office 945 Kalanianaole Ave. (808) 935-0021
Maui Branch Office 70 Hana Hwy (808) 877-6557
Lana‘i ¯ Office P.O. Box 120 (800) 828-8359
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ORGANIZATION Hawaiâ€˜i Gas has a statewide workforce of more than 300 energy professionals. About two-thirds of our workforce are proud members of the Teamsters Union Local 996. The company is also an indirect subsidiary of Macquarie Infrastructure Company, MIC (NYSE: MIC), a $5.01 billion corporation that owns, operates, and invests in a diversified group of infrastruture businesses in the United States.
Corporate Executive Management Team
Alicia Moy Chief Executive Officer
Chief Financial Officer
Chief Operating Officer
Joe Boivin, Jr. Business Development & Corporate Affairs
David Uchiyama Sales & Marketing
Nate Nelson General Counsel & Secretary
Jack Grimmer EHS & Quality Assurance
Albert Mossman Human Resources
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WHO WE SERVE Hawai‘i Gas serves over 68,000 customers statewide. The company’s utility business serves approximately 35,000 customers while the tank and cylinder division serves approximately 33,000 customers. Hawai‘i Gas is the only gas utility in Hawai‘i regulated by the Hawai‘i Public Utilities Commission. The company is also the largest propane distribution company in Hawai‘i, and one of the largest in the U.S.
Commercial 85% Residential 15%
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OUR PRODUCTS Synthetic Natural Gas (SNG) SNG is methane produced by converting naphtha, a by-product of oil refining, into methane. This process occurs at Hawai‘i Gas’ SNG Plant in Campbell Industrial Park. Our SNG is chemically similar to natural gas found in the earth all over the world. SNG is distributed to the greater Honolulu area via an underground utility pipeline system that runs from Kapolei to Hawai‘i Kai.
Propane (LPG) Hawai‘i Gas’ propane, also called liquefied petroleum gas (LPG), comes from local refineries and is also brought to Hawai‘i by tanker. Propane is delivered directly to our statewide bulk propane storage facilities. Propane can also be transported between islands by two interisland propane barges enhancing our supply reliability. Hawai‘i Gas also has smaller propane utility systems located throughout the state.
Carbon Dioxide (CO2) During the SNG manufacturing process, CO2 is removed and passed through a regenerator where it is prepared for sale to another business in Campbell Industrial Park for further processing. The CO2 eventually finds its way to Hawai‘i consumers in various forms including dry ice and the fizz in all carbonated drinks made in Hawai‘i. Hawai‘i Gas is the state’s largest supplier of CO2 for processing.
OUR SERVICES Energy Consultations At Hawai‘i Gas, we value customer service. Our energy professionals are available for energy efficiency audits, energy solutions engineering and energy analysis of alternatives to make sure our customers make the most safe, cost-effective and efficient choices for their home or business.
Appliance Installation, Maintenance & Repair Hawai‘i Gas has in-field service technicians specializing in the repair and maintenance of all gas appliances. We want to ensure reliable and safe service all the way until our customers turn on their gas. Our technicians are trained to stay current on new appliances and best practices ensuring safe, efficient and reliable service.
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RENEWABLE NATURAL GAS Renewable natural gas (RNG), derived from biogas, performs just like the reliable and clean-burning natural gas we use today. Biogas is created when bacteria or microbes break down organic material in the absence of oxygen. This process is known as anaerobic digestion. The gas can then be cleaned up to pipeline-quality RNG and injected into a utility system or liquefied for transportation.
There are opportunities to harvest biogas in Hawai‘i. RNG represents an opportunity to create a new industry and drive job growth in Hawai‘i while helping the state reach its clean energy goals. Hawai‘i Gas hopes to increase its utilization of biogas and use its utility infrastructure to share the benefits of this renewable energy source with our customers.
RNG SOURCES IN HAWAI‘I
USES OF BIOGAS
Pipeline Injection 7 | Hawai‘i Gas Company Profile
Agricultural crops & waste
We can capture biogas, clean it up, and combine it with our other products such as LNG and SNG, providing a clean and renewable energy source.
LIQUEFIED NATURAL GAS Liquefied natural gas (LNG) is natural gas, or methane, cooled to -260oF. When in a liquid state, natural gas occupies 600 times less space making transportation to Hawai‘i safe and economical.
A PARTNER FOR RENEWABLES
Dispatchable Natural Gas-fired Energy
Intermittent Renewable Energy The efficient turbines used to generate electricity from natural gas have the ability to cycle up and down to meet the fluctuating power demands from intermittent renewable energy. When the sun stops shinning or the wind stops blowing, natural gas-fired power plants can quickly
dispatch electricity without interrupting service to customers. Generating power from a clean, EPA compliant, lower cost fuel like natural gas to meet these fluctuations means we can adopt more intermittent renewable energy and lower our carbon footprint.
WHY LIQUEFIED NATURAL GAS FOR HAWAI‘I? Since LNG is the chemical equivalent to SNG and RNG, Hawai‘i Gas can use LNG to lower the cost of its existing product, increase reliability through diversification, and lower its carbon footprint.
Natural gas and its benefits can be used in a variety of applications that we don’t utilize today. For example, thanks to its clean burning properties, natural gas vehicles produce 30 percent fewer greenhouse gas emissions.
The Hawai‘i Natural Energy Institute reported that, thanks to low natural gas prices on the U.S. Mainland, we can bring domestic LNG to Hawai‘i 30 percent to 50 percent cheaper than oil through 2030.
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HISTORY OF HAWAI‘I GAS 1900
The Journey Begins
On April 1904, President Theodore Roosevelt signed The Dimond Gas Franchise recognizing the company as the gas utility in Hawai‘i.
In 1907, the company installed 12 gas lights on O‘ahu College’s campus in Manoa. The lines provided access to homes behind the school. The first extension of the distribution system was complete.
The Wonder of Gas
On May 14, 1905, the company opened its gas manufacturing plant in Iwilei converting bunker fuel oil for ships to gas. A few months later, the first gas was sent through 12.5 miles of pipeline to 250 customers, as well as to Honolulu Harbor to light the docks for sailing ships. The 20th century dawned with the age of gas and electricity in Hawai‘i.
In 1909, the Pacific Coast Gas Association reported that the company was making gas with “less oil than any other plant in the world, and its high pressure distribution system is years ahead of its time.”
Doing Right by Its Employees When the Wage and Hour Law became effective in 1938, wages at Hawai‘i Gas already exceeded the minimum requirements. Hours were less than the maximum and employees already received time-and-a-half for overtime.
The Great Depression Environmental Awareness In 1939, the company built a 2-million-cubic-foot gas holder at Iwilei and installed new filters to catch the cinders coming from the plant.
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Despite the Great Depression, the company experienced solid growth. Between 1933 and 1939, the number of active gas meters increased 35 percent. The company also reduced its rates three times to help struggling families and businesses.
A New Competitor A new competitor arrived at the end of the war when shops began pushing a new “cooking device,” the electric range. A Hawai‘i Gas employee obtained one and experimented by boiling a quart of water. Gas did the job in one-fifth the time of electricity.
In 1910, the company moved its offices and appliance showroom to Beretania and Alakea streets to better serve its 1,928 customers. It also joined the ranks of horseless carriage businesses when the company purchased its first service truck, a one-cylinder Brush automobile. Between 1912 and 1916, the company expanded service in Kalihi, Kaimukı¯, & Waikı¯ kı¯. By 1918, World War I ended and the company was prepared to meet the demands of postwar growth.
Innovation and Growth
Corporate Headquarters In 1922, service to the company’s 7,000 customers improved again when employees moved to a new corporate headquarters at 82 South Hotel Street. Following more growth over the decade, the company moved to 75 South King Street.
More Supply for the Demand In 1923, the company installed its fifth Jones Generator effectively increasing supply by 500 percent since 1905. A one-million-cubicfoot gas holder was also installed that year, quadrupling storage capacity.
Kamake‘e Expansion The constant demand for gas energy led to the company’s purchase of a building site on Kamake‘e Street. The following year, a distribution center was built providing facilities for construction crews, customer service, the meter shop and garages. Hawai‘i Gas continues to operate out of the Kamake‘e Street building today.
More Service Expansion
In 1927, gas service expanded to customers away from the pipeline for the first time. The company became the agent for a brand of bottled gas called “Rock Gas.”
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The War When war arrived in the early morning of December 7, 1941, Hawai‘i Gas continued service even though the plant suffered some damage during the attack. The war, however, took its toll on the company as employees attempted to provide service under the most trying conditions. Labor shortages caused by the needs of the armed services required the company to transfer employees to assist in gas making. Managers rolled up their sleeves and worked alongside the crews. Rising oil costs, lack of materials, and labor all took its toll on the company for the rest of the decade.
Cleaning the Gas Despite the tough times, the company opened a modern plant laboratory in 1946 with equipment that automatically measured the heat value of gas for the first time, and a new $100,000 purifier went into service. In 1948, the company installed new equipment improving its waste systems and removing tar from gas.
A Friend in the Kitchen Since its founding, Hawai‘i Gas taught many homemakers cooking secrets under its many home economists. The most popular was Muriel Miura who appeared in a television series on Japanese Cooking in 1974. Five years later she starred in a 13-week cooking series produced by Hardwick Stove Co. and Hawai‘i Gas. The series was shown in Hawai‘i and on select stations on the Mainland. Muriel even had the chance to cook with Julia Child.
Only Turkeys Waste Energy During the 1973-74 oil crisis and beyond, Hawai‘i Gas worked tirelessly to ensure energy security for the state and promote energy conservation. In 1978, the company’s 8-foot mascot, Gasbird, went out on a conservation campaign trail. Children across the state recited his new slogan, “Only Turkeys Waste Energy.”
Pollution Free Gas Plant
Pacific Resources, Inc.
With major renovations needed at the Iwilei Plant and limited space in the developing downtown area, the company decided to build a new $7.2 million plant to produce synthetic natural gas (SNG), made from naphtha at Campbell Industrial Park. Unlike its predecessor, the SNG plant was pollution-free. The only by-product was carbon dioxide. The plant would receive feedstock from its sister refinery next door.
In 1971, Pacific Resources, Inc. or PRI, became the holding company of both Hawai‘i Gas and Hawaiian Independent Refinery (now known as the Hawai‘i Independent Energy, a subsidiary of Par Petroleum). Millions of dollars were invested in both entities to meet Hawai‘i’s growing energy needs in an efficient and environmentally responsible manner.
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On to the Neighbor Islands In 1950, the company expanded to Hilo by purchasing Hilo Gas Company, Ltd. providing and assuming service for its 2,300 customers. To ferret out leaks in the old system, long neglected by prior ownership, the company launched “Operation Sniff.” A heavy dose of odorant was added to the line and townspeople phoned in tips winning cash for helping to find leaks. In 1958, the company expanded to Kaua‘i purchasing an existing butane business.
Welcome to the Future In 1951, operations were modernized to improve service and reduce costs when radio-equipped service trucks arrived and computers were put to work handling thousands of accounts. New upgrades to the plant resulted in the company’s oil gas plant becoming one of the most modern plants in the U.S. The tar and aromatic oils like benzene were vital for the synthetic rubber industry that supported the Korean conflict.
Statehood! When the final countdown began to statehood, employees of Hawai‘i Gas placed a large gas tiki torch atop Tantalus. It burned for 29 days and nights until the bill passed on March 12, 1959. Statehood, and the introduction of commercial jet air service to Hawai‘i, brought tremendous increases in business activity and the trend toward gas was everywhere.
Creating an Iconic Symbol
In 1960, the company patented the world’s first windproof tiki torch. The torch became an iconic symbol for Hawai‘i luring tourists to sandy beaches and businesses all over the state.
Aloha, Maui! In 1960, Hawai‘i Gas expanded to Maui by purchasing the Maui Dry Goods Company’s butane gas business. The company’s customers immediately increased by another 1,200 accounts.
A Shift to Propane In 1961, Standard Oil opened its new refinery in Campbell Industrial Park. The refinery meant the gas plant could rely on a constant supply of uniform feedstock. Because the new refinery made propane, not butane, the company had to adjust appliances across the state for propane.
Anchors Away In 1968, Hawai‘i Gas invested $1 million improving gas service to the neighbor islands by placing a 10,000-barrel propane barge into service.
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BHP Hawai‘i, Inc. In 1989, the Hawai‘i Public Utilities Commission approved the acquisition of PRI by Broken Hill Proprietary Company, Limited, the parent company of BHP Hawai‘i, Inc. A new era of ownership began for Hawai‘i Gas.
Millions in Investments Throughout the ‘80s PRI invested over $100 million in its refinery to ensure Hawai‘i had the energy supply to grow into the next century.
Separate Sisters In 1997, Citizens Utilities purchased the company separating the refinery and gas operations. Hawai‘i Gas continued being a big customer of the Refinery purchasing naphtha to produce SNG at its SNG Plant next door.
In 1981, the company installed a $100 million hydrocracker complex helping increase jet fuel production to 12,000 barrels per day (bpd). Just one year later, an $18 million hydrogen plant came online increasing jet fuel production to 20,000 bpd. In the same year, a new $7 million light ends recovery unit enabled the refinery to produce butane and propane.
Paving New Roads In 1990, BHP Hawai‘i, Inc. constructed an asphalt plant capable of processing high sulfur oil into 700 barrels of asphalt in 12 hours, creating a new, environmentally sound opportunity.
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Clean Water In 1994, BHP Hawai‘i, Inc. invested $20 million in a waste water treatment unit to properly dispose of its waste products. The unit uses a biological treatment process where microbes biodegrade hydrocarbons dissolved in waste water from the refining process.
2000 k1 Ventures, Limited Just six years after Citizens Utilities acquired Hawai‘i Gas, the Hawai‘i Public Utilities Commission once again approved the sale of the company to k1 Ventures Ltd.
Macquarie Infrastructure Company In 2006, Macquarie Infrastructure Company (MIC) purchased Hawai‘i Gas after two decades of ownership turnover. The purchase provided the company stability and the means to focus on becoming a leader in Hawai‘i’s clean energy future.
Renewable Natural Gas In 2009, the company began looking for ways to diversify its supply sources. A few years later, the company dedicated its pilot Renewable Natural Gas (RNG) Plant in Kapolei. The project was the company’s first attempt to develop a renewable product in the company’s long history.
Liquefied Natural Gas In 2014, Hawai‘i Gas became the first company to transport LNG to the State for emergency backup use to maintain its reputation as the most reliable gas energy provider in the Hawai‘i. Plans are also in development to bring in larger quantities of LNG to lower the cost of energy for multiple industries throughout Hawai‘i.
The Clean Energy Company On August 1, 2013 the company officially rebranded to Hawai‘i Gas - The Clean Energy Company. After years of confusion with other companies, The Gas Company changed its name to make it clear where the company called home and the vision it had for Hawai‘i’s clean energy future.
Waste to Energy Starting in 2012, Hawai‘i Gas began looking at other ways to further displace its reliance on imported petroleum products by harnessing biogas from landfills and wastewater treatment plants and cleaning up into pipeline quality Renewable Natural Gas.
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GET TING GAS Honolulu Utility System Throughout most of the greater Honolulu area, gas customers are served by Hawai‘i Gas’ Synthetic Natural Gas Plant in Campbell Industrial Park. Gas is produced at the plant with no residual waste products and piped through an underground utility system directly to consumers. The Honolulu Utility System can also be utilized to feed a mixture of natural gas from the mainland U.S. and renewable natural gas to our customers.
Propane Utility System In areas not served by the Honolulu Utility System, including the neighbor islands, Hawai‘i Gas’ utility customers are supplied with propane stored in large holder stations which, like SNG, is piped underground to the customer from a central point.
Tank & Cylinder Service Where SNG or propane underground utility service is unavailable or unfeasible, gas customers throughout Hawai‘i use Hawai‘i Gas’ tank & cylinder propane service. A tank or cylinder of propane is safely stored near the point of use so customers anywhere can enjoy the benefits of clean-burning gas energy.
PropaneXchange Hawai‘i Gas’ PropaneXchange program has introduced a new type of cylinder that’s 30 percent lighter than steel, non-corrosive and features a see-through design allowing customers to know the propane level without gauges or guessing. PropaneXchange customers can take their empty tank to any PropaneXchange location and conveniently exchange it for a full one. 15 | Hawai‘i Gas Company Profile
Quick Gas Facts Using gas energy directly in appliances is three times more efficient than electricity derived from fossil fuels. Efficiency saves energy and money.
Gas energy produces 50 percent less CO2 than coal and 30 percent less CO2 than fuel oil, both of which are used to generate electricity in Hawaiâ€˜i.
Many municipalities and companies like Disney and UPS are beginning to take advantage of the clean-burning properties of gas energy to reduce their carbon footprint. Converting just one refuse truck has an emissions reduction impact equivalent to taking 325 gasoline cars off the road. Hawaiâ€˜i Gas Company Profile | 16
PROPANEXCHANGE Nothing says the weekend like firing up your grill down at the beach, at a UH football game or in your backyard. Hawai‘i Gas’ propaneXchange program introduces a new type of cylinder that’s 30 percent lighter than steel, non-corrosive and features a see-through design allowing you to know the propane level without gauges or guessing. Our cylinders are thoroughly inspected by our energy professionals before and after every exchange.
Our propaneXchange program is as simple as 1-2-3. 1. Locate an attendant. 2. Exchange your tank. 3. Pay and be on your way. PropaneXchange is currently available on O‘ahu, Kaua‘i, and the Big Island. Hawai‘i Gas plans to open more locations throughout the state. To see a full listing of locations please visit www.hawaiigas.com.
P R O P AN E
Easy to exchange. Easy to use. Easy to love.
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PIPELINE SAFETY At Hawai‘i Gas, safety is THE priority. Hawai‘i Gas, and the gas industry as a whole, has an excellent record which is the result of extensive industry safety programs overseen by state officials and the U.S. Department of Transportation (DOT) under the Congressional Pipeline Safety, Regulatory Certainty, and Job Creation Act of 2011. Every year, Hawai‘i Gas dedicates significant resources to ensure that gas energy is delivered safely and efficiently. Hawai‘i Gas’ pipelines are subject to a wide range of pipeline integrity, pipeline safety and public education programs. The design, construction, operation, inspection and maintenance of all
operating pipelines are subject to state and federal regulations and requirements. The inspection and maintenance performed by operators takes in to account all of the following: incident and leak history, corrosion control records, continuing surveillance records, patrolling records, maintenance history, local conditions, and excavation damage experience. Serious incidents, related to gas transmission and distribution are extremely rare in the United States. Over the past 20 years, “third-party” damage has been the primary cause of serious incidents on gas pipelines.
CALL BEFORE YOU DIG Excavation damage is the leading cause of serious pipeline accidents. The gas industry has put in place a number of safeguards to help better detect a potential natural gas leak. All our products are mixed with an oderant once sent to our customers — which smells similar to rotten eggs — in order to provide an added layer of safety for leak detection purposes. The industry also promotes the use of “Call 811,” a national number for people to call at least five business days before they begin any excavation project, no matter how small. Once called, crews will tone (mark) utility lines to avoid contact. Since the Call Before You Dig program was implemented, damage from third parties has decreased significantly.
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This Company Profile of Hawai‘i Gas is produced by the Communications Department of Hawai‘i Gas.
Hawaii Gas - The Clean Energy Company - November 2015