Sopogy’s Demise is a Huge Victory for Honest Engineering and the Taxpayer

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Panos Prevedouros, a professor of engineering at the University of Hawaii
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Panos Prevedouros, PHD, professor of Engineering at the University of Hawaii
Panos Prevedouros, PHD, professor of Engineering at the University of Hawaii

BY PANOS PREVEDOUROS PHD – Along with a trio of highly capable mechanical and systems engineers, I spent dozens of hours poring over the specifics of the micro-concentrated solar power touted by Sopogy which shut down several months prior to this April 2014 article.

Sopogy was told by numerous engineers that their Kona projections were absurd and violated the second law of thermodynamics.  Sopogy proceeded anyway with their original plan.

My multi-year effort was particularly painful because this incompetent technology had received the 2009 Blue Planet Foundation Award and my own Dean sat at the board of directors of BPF when this award was made. Keahole Associates, an Oahu venture of Sopogy, was promoted in University of Hawaii, College of Engineering literature.

Here is some of the 2009 hyperbole: “Sopogy is developing the next generation of high efficiency solar panels and energy storage technologies for Hawaii and the World.  Keahole Solar Power developed and constructed a 2 megawatt solar thermal project and is developing an additional 30 megawatts of fossil fuel free power.  Together his companies employ and support hundreds of green collar jobs and kept over $500 million in Hawaii’s local economy through energy savings. In addition his work has off-set over 2 million metric tons of CO2 emissions which is the equivalent of reducing 27,000 tankers of gasoline or eliminating the consumption of 4.6 million barrels of oil.”

The most factual evidence suggests that throughout its existence, Sopogy generated 0.1 MW!  This is roughly equal to 50 modest solar installations on residential rooftops.  It took $20 million (yes million) of Hawaii technology tax credits to accomplish so little.

Sopogy is developing the next generation of high efficiency solar panels and energy storage technologies for Hawaii and the World.  Keahole Solar Power developed and constructed a 2 megawatt solar thermal project and is developing an additional 30 megawatts of fossil fuel free power.  Together his companies employ and support hundreds of green collar jobs and kept over $500 million in Hawaii’s local economy through energy savings. In addition his work has off-set over 2 million metric tons of CO2 emissions which is the equivalent of reducing 27,000 tankers of gasoline or eliminating the consumption of 4.6 million barrels of oil. – See more at: https://social.csptoday.com/technology/sopogy-ceo-receives-blue-planet-foundation-award#sthash.1MB5Q8Cs.dpuf
Sopogy is developing the next generation of high efficiency solar panels and energy storage technologies for Hawaii and the World.  Keahole Solar Power developed and constructed a 2 megawatt solar thermal project and is developing an additional 30 megawatts of fossil fuel free power.  Together his companies employ and support hundreds of green collar jobs and kept over $500 million in Hawaii’s local economy through energy savings. In addition his work has off-set over 2 million metric tons of CO2 emissions which is the equivalent of reducing 27,000 tankers of gasoline or eliminating the consumption of 4.6 million barrels of oil. – See more at: https://social.csptoday.com/technology/sopogy-ceo-receives-blue-planet-foundation-award#sthash.1MB5Q8Cs.dpuf

In 2010 is was announced that DHHL was about to enter into a (tragic) agreement with Sopogy. It would have cost taxpayers tens of millions of dollars to develop a 30 MW solar power plant.

Then in 2011, Sopogy won the APEC 2011 Hawaii Business Innovation Showcase award for Honolulu.

Throughout this period Sopogy CEO Darren Kimura was the energy darling of Governor Neil Ambercrombie. The Gov would not grant me an appointment to talk about energy issues for Hawaii despite repeated requests. Of course his energy point man, Bryan Schatz is so pro “renewables” that logic and cost are not an issue.

Despite everything being stacked in favor of Sopogy, I summarized the analysis and warned DHHL that they should be cautious about this type of power plant and investment. The local media ignored my article. Only the Hawaii Reporter printed my opinion.

In January of 2013 the Hawaii Venture Capital Association gave Sopogy the 2012 HVCA Deal of the Year Award for a deal that (thankfully) went nowhere!

All these august bodies failed to do even minimal due diligence. For example they simply could have looked at HEI’s Securities and Exchange Commission filings which list the power they purchase from power sources other than their own.  Sopogy’s Kona power plant appears nowhere.

Before publishing my analysis in 2011, I met with Darren Kimura at the Pacific Club. I informed him that I can find no power sold to HELCO and he said that he’ll furnish me data, although most of the power was used “internally.”  Darren never got back to me.  It was clear to me that he was selling duds for millions.

On April 23, 2014 greentech referred to my 2011 article and commented as follows:

“Kimura and the company always seemed to be on hand to receive an award, bond, or tax credit in Hawaii but rarely could the firm be found making competitive energy, despite the CEO’s claims.

“We have about 75 megawatts under contract and in the process of being deployed,” claimed the CEO in a 2011 interview. In a much earlier interview he spoke of a 50-megawatt solar farm in Spain and $10 million per year in revenue.

“Even before the price of silicon photovoltaics plunged it was difficult to see how Sopogy could ever be competitive.”

This is only one sample of international humiliation for Hawaii.

Several lessons were observed but likely were not learned, as follows:

1.  Good, honest engineering can reveal technical and economic duds.
2.  Once a project (or company) is an engineering or economic dud, it will fail.
3.  The demise of Sopogy is fortunate because duds like it can become a tax supported scheme concocted by greedy rent seekers and enterprising politicians who also create legal supports for the schemes. For example Hawaii’s PUC considered preferential pricing for concentrated solar power to make sure that the 30 MW Kalaeloa scheme would make money (while the taxpayer would get fleeced.)
4.  Media, politicians and environmentalists know nothing about engineering stars and duds, but they have bestowed upon themselves arbitrary decision wisdom  that determines winners and losers.
5.  Many people go along to get along, or do the wrong thing for money regardless of what the right, ethical or moral thing to do is.
6.  There was abundant “me too” or follower behavior and scarcity of prudent analysis and caution.
7.  The truth rarely comes out, or comes out after precious funds have been lost. In this case millions of tax dollars were lost at the Kona plant and large acreage in the Ewa plane was bulldozed.
8.  HEI, the parent of HELCO and HECO knew the facts about Kona’s Sopogy plant but did not make any apparent public disclosures when DHHL was proposing a mega version of the Kona power plant. Worse yet, HECO ran a Sopogy television commercial repeatedly from 2011 to 2013, touting Sopogy technology and HECO’s commitment to ecology.
9.  Hawaii’s blind promotion of a sub-standard technology sets a bad precedent in an area were Hawaii already is weak.
10.  Nobody will likely be held accountable for the wasted tax credits or apologize for rewarding incompetence. Will there be an AD’s inquiry of DHHL and HECO?

Many well-known people such as Governors Lingle and Abercrombie, Chancellor Virginia Hinshaw, Blue Planet Foundation’s Henk Rogers, and Hawaii’s only billionaire Pierre Omidyar have Sopogy egg on their face. But given that this is Hawaii, the Sopogy scandal will likely die off quietly and the charlatans will have the last laugh.

PS. The counsel of attorney and engineer Eric Beal is greatly appreciated.

Comments

comments

11 COMMENTS

  1. Former Governor Ben Cayetano, whom the author of this piece advised during his run for Honolulu mayor, was also a member of the Board of Directors of the Blue Planet Foundation that presented the 2009 award to Sopogy! Why not mention this fact also in the piece?

  2. Nine out of ten start-ups go belly-up. It is not clear here whether Sopogy went under because of unanticipated economic conditions, such as cheap natural gas and falling solar panel prices, or because it violated the second law of thermodynamics as claimed without supporting facts. After all, it was endorsed by people with true energy credentials like the Dean of Engineering Dr. Peter Crouch who is a PhD in Electrical Engineering from Harvard. Why not get his side of the argument and provide a balanced coverage of this important question. And who are the three anonymous engineers who fed Prevedorious his conclusions?

    • Good point! This means that anybody who argues against all start-ups will be correct 90% of the time, but will contribute nothing to progress.

  3. Darren Kimura is a weasel who fleeced his investors, his employees, and others who were foolish enough to trust him. A genuine BS artist! Shame on the politicians for not doing due diligence. I saw Sopogy's stuff was crap many years ago. It actually is not that hard. First of all, their troughs had the aluminum reflective coating that was too exposed to the elements. Yes, they might have improved it since their first Kona project but it was still crap. Other companies keep the aluminum reflective coating on the inside of the glass and totally protected — you can look up Schott glass, which does it the right way. Secondly, trough is interesting for process heat but not good for generating electricity. It just does not get hot enough to get attractive Carnot efficiency that can compete with PV's combined efficiency and cost. Thirdly, Sopogy's biggest failing was that Darren Kimura is a weasel BS artist. It is amazing that he kept afloat for so long.

    Thanks for your article Panos.

    • There was a clear claim in the article that the system violated the second law of thermodynamics. This rant talks about possible design flaws, that (after the fact) it may not be as efficient as other approaches, and calls the CEO a "weasel BS artist," but provides zero evidence to the "scientific" claim that it violated the second law of thermodynamics.

    • I agree with this post. I worked for Darren when he spun off Sopogy from his other flop of a company – Energy Industries. Working on the initial research of the CSP technology, it was clear that the industry had been moving toward larger reflectors and higher operating temperatures to allow for higher Carnot efficiencies and the use of molten ceramics to give the needed firm power generation at night. Darren's dream was to build small skid mounted CSP units that could be installed for a hotel or industrial load as a cogen that would also provide their needed heat load. Problem is that the small reflectors he had made were incapable of directing enough energy to the collectors to turn a tubine efficiently! Truth is his companies never had the experience or know-how to succeed in a field that has shown successes in CSP farms dating back to the early 80s. He comes out of left field, throws all of gains and progress thats been made over the past 20 years out the window, dazzles a lot of people with some flashy words about how he's developing a NEW technology optimized to tropical regions and he dupes so many of Hawaii's leaders and swindles the taxpayer and green companies that could have better spent the money on promoting technologies with real potential.

  4. Its important to keep in mind that Pano is a civil engineer, not a mechanical engineer and certainly not a physicist. He has been on this political rant for many years. Sopogy actually built the project in Kona and proved the technology worked. This argument is based on outdated facts and quotes over time. If you really cared about Hawaii Pano you would stop taking tax payer money and try a start up company yourself.

    • Eric, Interesting point. Panos is an engineer and he attempts to tie Sopogy's technology to Kimura. Kimura is a businessman and he hired engineers to develop the technology. It would interesting to get the perspective from someone in the business community. I always saw Darren Kimura as Hawaii's most talented businessman.

  5. Celebrating to loss of jobs and claiming the death of a technology and company is a victory? What the hell is wrong with you guys? The only victory would have been for the company to make a lot of money and put Hawaii on the map as a renewable energy metropolis. Shame on you for writing such garbage and perhaps this is a good lesson for the people of Hawaii regarding how this group including the author thinks. I for one would never want this person to be a leader of the people, ever…

  6. The Hawaii Reporter and Panos can't handle the truth! We created a very specific response to this article and posted here several weeks ago. Our response was drafted by 23 members of Hawaii's Start-up and Cleantech community. Can't handle the facts? Can't handle having someone push back on your garbage reporting? Why else would you delete our post?! Bottom line, this article written by Professor P is absolute trash filled with inaccuracies, exaggerated facts and political manipulation. Do the right thing and repost our response or we'll take this to the next level. ~HiCombinator

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