UH: Hawaii economy benefited from NELHA to tune of $90M

Swipe left for more photos

Deep sea water pipes leading to the OTEC Tower are seen at the Natural Energy Laboratory of Hawaii Authority. (Laura Ruminski/West Hawaii Today)
A pipe carires seawater to tenants of NEHLA. (Laura Ruminski West Hawaii Today)
Hawaiian Astaxanthin is cultivated in ponds at Cyanotech Corp in the Natural Energy Laboratory of Hawaii Authority. (Laura Ruminski/ West Hawaii Today file photo)
Temperature-controlled sea water is pumped into abalone tanks at Big Island Abalone at NELHA. (Laura Ruminski/West Hawaii Today)
Subscribe Now Choose a package that suits your preferences.
Start Free Account Get access to 7 premium stories every month for FREE!
Already a Subscriber? Current print subscriber? Activate your complimentary Digital account.

Businesses at the Natural Energy Laboratory of Hawaii Authority and the Hawaii Ocean Science and Technology Park at Keahole Point contributed over $90 million to Hawaii’s economy in 2022, according to a University of Hawaii Economic Research Organization analysis.

The report found the total economic impact of the park was $145.4 million in 2022. Total expenditures from the businesses at NELHA were $148.4 million, of which about $90.3 million was paid to Hawaii entities in 2022.

NELHA’s economic impact on the state economy expanded significantly from 2018 to 2022, with total output rising from $120 million in 2018 to $145 million in 2022.

Earnings, tax revenues and job growth increased by 28%, 25% and 20%, respectively, during this period.

There are 49 tenants at the 870-acre facility focusing on emerging renewable energy, aquaculture and other ocean-based sustainable technologies.

Three sets of pipelines deliver cold deep sea water from up to 3,000-feet deep, as well as warm pristine surface seawater utilized by the tenants. The state has invested over $100 million since 1974 to create the site located adjacent to Wawaloli Beach Park.

NELHA Executive Director Gregory Barbour said the self-sufficient state agency collected $2.3 million in land rent in fiscal year 2023, a 9% increase from the previous year. Cumulative base rent increased by approximately $200,000 or 10% based on new leases in 2023, with four more companies potentially leasing space after having obtained approval in concept from the board.

NELHA managed over $20 million in projects in 2023. Of this, $5.4 million came from special funds, $7.7 million in federal grants and $7.3 million in capital improvement projects.

“Over the past 10 years, NELHA has received an average of $2 million per year through appropriated capital improvement project funds for site development. As such, the state’s return on investment is very high, as each dollar of state expenditures toward NELHA results in over $62.2 of output generated in Hawaii’s economy,” said Barbour.

“We continue to see success from our investments in science and technology, and this data regarding NELHA confirms this,” said Gov. Josh Green in a prepared statement. “We have world-class assets and additional investments in marine sciences, and leveraging our state and UH assets will help accelerate growth in our blue economy in the areas of food security, ocean technology, ocean conservation and ocean energy. It will also increase cohesion with efforts being carried out by other Pacific Coast states.”

The report estimated state tax revenue generated by NELHA was $7 million in 2022.

The analysis also found that businesses at the facility employ hundreds of people, and that expenditures contributed to a total of 714 jobs in the larger Hawaii economy in 2022. This equals about eight jobs created for every million dollars spent at NELHA.

“NELHA’s direction is part of the state’s plan for economic diversification, and we continue to anticipate and plan for additional growth in other areas in the blue economy,” said James Kunane Tokioka, director of the Department of Business, Economic Development and Tourism. “NELHA’s future is full of opportunities that will lead to the strengthening of our communities and economy for the island of Hawaii and the state.”