Shutting Down the Farm & What’s Next

I met with my employees today to tell them our big news first, and now let me tell you about it:

We are shutting down the farm. The last bananas will be the ones we are bagging now, which will be ready around the end of March, and then that will be it.

The background, I explained to our workers, is that when we moved the farm here from Kea‘au, we were able to offer a good profit-sharing plan, and one of the best medical and dental plans you could get. It had vision and all kinds of extras.

But after a number of years, we started having a harder and harder time. First we couldn’t keep funding the profit-sharing plan and we had to discontinue that. Then we had to start cutting some of the medical benefits.

Then last year we had to cut wages one time. That was pretty desperate, and we always intended to raise them again, but we were never able to. And now, looking down the road, we see Banana Bunchy Top Disease, which is already in the gulches here nearby.

It’s all related to the price of oil. As the oil price has risen, folks that could pass on the cost did, but farmers cannot. When the oil price dropped recently, the cost of fertilizer, plastic, all sorts of things that have oil petroleum costs embedded in their prices, didn’t come down with it. Those costs stayed up.

The oil price will go back up again, and anticipating that we had to make a decision. It’s not that we’re going bankrupt – we’re not. We just need to do what we need to do before it gets to that point.

What Now?

We do have an option, as I explained to the workers.

A group that’s applying for a license to grow and distribute medical marijuana is interested in leasing some of our land, as well as the hydroelectric. Although I already knew we were shutting down when they first came to talk with me, I didn’t take it very seriously. But in the last few weeks, it’s become pretty serious.

My main concern is my workers. I told this other group that before I even considered leasing to them I’d need assurance they would give my workers first shot at jobs. They said they would. I also made some conditions regarding security. It’s not a sure thing, but on the outside chance they are granted a medical marijuana license, they will also have to take care of the community, especially in terms of security, so I can ensure that the community feels safe.

They are interested in me participating with their group because they know I know what I’m talking about when it comes to growing things, and about energy. We are talking but we haven’t signed any agreements about any of it yet.

I told my workers today that they can do whatever they need to do. If they want to take a layoff because feel they need to go out right now and start looking for a new job, they can. Or if they want to stay until the end of March, that’s okay too. They all said they will stick it out to the end.

I just heard the Alexander & Baldwin announcement that it’s transitioning out of sugar at its 36,000-acre sugar plantation on Maui. A&B’s Executive Chairman Stanley M. Kuriyama said, “The roughly $30 million agribusiness operating loss we expect to incur in 2015, and the forecast for continued significant losses, clearly are not sustainable, and we must now move forward with a new concept for our lands that allows us to keep them in productive agricultural use.”

“Transition” is the right word for what we’re doing, too. We don’t know exactly what the transition will look like, but we’ll still be around. The land that was in bananas is going to go into corn. A dairy that already leases land from us to grow corn is going to take the rest of that land and plant more.

We’ll see what happens with the rest, whether it’s the medical marijuana group or something else. There are options. Stay tuned.

Six Days to ‘Reality 101’

Only six more days until ‘Reality 101,’ the talk Nate Hagens will be giving at UH Hilo.

He will speak about how we need to adapt for the changes happening around us. He feels strongly that it’s today’s young people who should be concerned, because it’s their time coming up, and he will discuss what we need to do to make their world a better place. Bring a young person or two with you if you get a chance!

He’s speaking on January 12th at 6:30 p.m. in UCB 100.

Click to hear a short preview of what Nate will discuss. This will be a very good talk and I highly recommend you attend. Mark your calendar!

HIEC Advisory Board Welcomes 2 New Members

We’ve got two new members on our Hawaii Island Energy Cooperative Advisory Board:

• Greg Chun, a former executive with Kamehameha Schools

• Vincent Paul Ponthieux, who founded Blue Planet Energy with Henk Rogers

Our Board of Directors includes myself, Gerald DeMello, Wally Ishibashi, Marco Mangelsdorf, Michelle Galimba, and Noe Kalipi.

Read more about HIEC.

One Week to ‘Reality 101’ at UH Hilo

What are you doing one week from tonight?

The talk I am counting down to is next Tuesday night, a week from tonight. Nate Hagens will be speaking at UH Hilo about how we need to be adapting for what’s coming in our world.

That’s January 12th at 6:30 p.m. in UCB 100.

Click to hear a short preview of what Nate will discuss. This will be a very good talk and I highly recommend you attend. Please mark your calendar!

Civil Beat Article about Richard & Co-op: ‘When People Power Meets Electricity’

Did you see this Civil Beat article that ran yesterday about Richard and the Hawaii Island Energy Cooperative? It’s a good look at how the price of oil and electricity affects agriculture.

When People Power Meets Electricity On The Big Island

NextEra Energy’s proposed takeover of Hawaii’s century-old utility has sparked a renewed effort to establish an electric utility co-op on Hawaii Island.

At Hamakua Springs Country Farms on the Big Island earlier this year, rows of aging arched white awnings covered surprisingly barren soil along the dirt road that leads into the farm.

Nate Hagens on What’s Coming Re: Energy, Jan 12

I helped arrange for Nate Hagens, a well-known speaker on “big picture” issues facing human society, to speak at UH Hilo on Tuesday, January 12th. He’ll be at UCB 100 at 6:30 p.m. His talk will be about how we can cope. Here is a short preview of what he will discuss:

I want to share an article of mine that ran in the Huffington Post last April. It’s about the people I turn to regarding energy issues, and they remain the same.

Before I rerun it for you here, I’ll add that the fracking revolution, which no one saw coming, caused the oil price to plummet a year ago. But as Robert Rapier points out,  we are very close to the bottom of the oil cycle, and we are likely going to repeat the cycle.

And here is that look back at the Huffington Post article (4/1/2014):

The People I Turn to Re: Energy Issues

It is clear to me that the most important issue we face here on the Big Island right now is that of energy costs. There is a huge risk associated with the rising price of oil, it’s going to affect us all, and we don’t have the luxury of time to deal with it. We need to figure it out now.

We have resources here and ways to address this. It’s not rocket science. It’s all a matter of cost and common sense. What I find is that the rubbah slippah folks get it quickly.

It comes down to a matter of attitude. Instead of being the people who look for a thousand ways why, “No can!” we must become people who look for the one reason why “CAN!!”

Energy issues are completely interconnected with agriculture — together, they all lead to our food security, or lack thereof — and I appreciate all the supportive testimony from so many people re: my renomination to the state Board of Agriculture. Here is a full list of the testimony, which includes support from some of the very knowledgeable people I turn to to learn about and confirm information about energy issues.

If it sounds like I know what I am talking about re: energy, it is because I have spent a lot of time at conferences and also learning from these experts, whose testimony you can read at that link above:

#7 Mayor Billy Kenoi. Mayor Kenoi recognized early on that geothermal would play a crucial role in our energy future and that’s why he helped the Geothermal Working Group, authorized by SCR 99, accomplish its work. I was part of a delegation he took to see geothermal operations at Ormoc City, Philippines. We visited a geothermal plant sited on the flanks of a volcano that last erupted 100,000 years ago. (In comparison, Mauna Kea last erupted 4,000 years ago and so is likely an even hotter spot for geothermal.) The mayor also formed a task force to evaluate the health effects of geothermal on the community.

#204 Henk Rogers. Henk is founder of the Blue Planet Foundation and understands and appreciates the potential of geothermal base power energy. He operates his own grid at Pu’uwa’awa’a Ranch. He also has a fully functional hydrogen refueling station on site. Hydrogen fuel cell cars are coming to the Big Island. Henk is a doer more than a talker. When he does talk, it’s likely to be with the King of Bhutan or Sir Richard Branson about energy issues.

#89 TJ Glauthier has operated at the highest level of our national government. He was second in command in the Department of Energy in the Clinton Administration. His list of accomplishments is so long that when I introduced him to the senior assets managers at Kamehameha Schools, I did it like this: TJ has an extremely long list of accomplishments but let me just describe him this way: He is a “good guy.” That’s all I needed to say. Here in Hawai’i, we all know what that means. He is a good friend and we are in constant contact.

#257 Robert RapierLike Mayor Kenoi, Robert Rapier is a “scrappah.” His was the lone voice that opposed Vinod Khosla’s biofuel projects because the net energy did not add up. Several hundred million dollars of subsidies later, Robert proved to be right. He knows his stuff. He has actually operated industrial-scale chemical plants, and yet he can explain scientific concepts in a way that is easy for the layman to understand. I can call him at all times of the day or on weekends. We have become good friends.

#82 Nate Hagens. Nate was editor of The Oil Drum blog, where academics, oil industry professionals and investors came to see what was new. If you participated, you had better know what you were talking about. These folks did not suffer fools lightly. The Oil Drum did not stop publishing because Peak Oil was dead; I think it stopped because we know all we need to know. Now it’s time to do something about it.

Charlie Hall. (See his testimony at this post.) Charlie Hall is a world-renowned systems ecologist. He does not speak about biology from an individual silo but talks about how it involves energy and its effects on real people. Environmentalists who are not systems-oriented sometimes forget about the effects on people. Charlie is known as the father of modern day Energy Return on Investment (EROI). I helped arrange lectures for him to speak at UH Hilo as well as UH Manoa. His wife Myrna, Charlie and myself have become good friends.

#84 Gail Tverberg. Gail is a former insurance actuary whose job was to price risk. She has a stark view of the future. Although I cannot find fault with her view of things,  I am the eternal optimist and spend my time looking for workarounds. Gail wrote in support of our Big Island Community Coalition’s efforts to lower electricity rates. (As it turned out, we were successful in defeating the Aina Koa Pono biofuel project, which would have cut off options for lowering our electricity rates.) I helped bring Gail to Hilo for a presentation at the Hilo Hawaiian Hotel and spent a whole weekend taking her family around the Big Island. I asked her a million questions.

I wrote this in November, and it’s still true. From Let’s Adapt to Change and Survive: “Charles Darwin said it’s not the strongest nor the smartest who survive, but the ones that can adapt to change. Let’s survive, and more.”