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It’s been a year and a half since state regulators ordered Hawaiian Electric Co. to issue a request for proposals for major energy projects that would deliver power to Oahu.

The RFP — the state’s most ambitious energy request — has generated intense interest from energy developers.

But companies hoping to bid have just been waiting, with in the RFP approaching a year.

Cable equipment is already in high demand as more projects are being developed worldwide.

A recent industry report on submarine electrical cables found that the current supply chain can only accommodate about half of the proposed undersea cable projects worldwide. About 70 projects are in the planning stages through 2016.

“Cables that do not get their place in the production line will face increased costs that could easily push projects over budget in these difficult financial times,” the The says. “The result could be higher energy costs for the populations that would have benefited from these grid interconnectors, island connections, or wind farm projects.”

Delays Continue

Originally, the RFP was scheduled to be released in the second quarter of 2012, according to a HECO . But that date has been repeatedly pushed back. In an email sent to energy stakeholders last week, HECO now says it “anticipates filing the proposed final RFP with the PUC sometime in the second quarter of 2013.”

The Public Utilities Commission must then review the RFP and approve it before its final release, an action that is expected to take 30 days.

HECO’s new date was greeted favorably, if not a little skeptically, by energy developers.

“It’s always been next quarter,” said Hugh Baker, a partner at Hawaii Infrastructure Partners, which plans to bid on the cable project.

The company, a partnership between HDBaker & Company, Anabaric Transmission and PowerBridge, was formed specifically to bid on the cable project. That was three and a half years ago. During this time, Baker has been living in Kona on the Big Island in anticipation of the RFP.

“We hope they really mean it this time,” he said.

HECO spokesman, Peter Rosegg, said that the utility’s draft RFP has gone through significant revisions, prompted by suggestions from potential bidders and the PUC.

“We hope this draft is at or near completion, but more changes could be required,” he said in an email. “It will be released upon approval by the PUC.”

Rosegg won’t say whether the hang up is with HECO or the PUC. He did not return a phone call seeking more information.

Cat Awakuni, chief counsel for the PUC, said rules prohibit the commissioners from commenting on open cases.

Time is Money

Energy developers say that the longer the delay, the more expensive projects are becoming.

Costs could particularly go up for undersea cables, a major component of many of the renewable energy projects. Developers are expected to submit proposals that have Oahu connections to Lanai, Molokai and Maui. There could even be bids for off-shore wind and cables to the Big Island, though energy experts say those projects are more technologically difficult.

The problem is that currently worldwide cable demand is outstripping supply, said Baker, and this could translate into higher costs.

“There is projected to be a lot more demand than capacity to make the cables,” he said. “The concern is that the longer it may take to get into the queue, to get the cable components, this could translate into higher costs.”

The Pike Research report looked at cable projects worldwide and projected costs will go up, potentially causing problems for projects that don’t get underway in the near future.

Cable manufacturing is expected to increase, but it’s unlikely to keep up with the pace of development, according to the report.

Bob Gohn, a senior research director for Pike Research, said that there are only about eight to 10 major cable suppliers in the world, most of them located in Asia.

Much of the demand for undersea cables is being driven by off-shore wind projects in Europe and the need to connect inter-island grids to stabilize power as more renewable energy projects come online, he said.

“In Europe, it’s both the push for cleaner forms of energy, but also a bit of an energy security issue, with Germany making the decision to wean off of nuclear in the wake of the Japanese Fukushima disaster — that has done nothing but accelerate greater wind,” he said.

It’s not just cable costs that could go up with the delay in the RFP.

Developers also say that the postponed RFP is generating increased project risk, something that investors don’t like. And with higher risk can come increased demands from investors for a higher return on their investment.

“In general, further delay means more uncertainty, and uncertainty is the same thing as risk. So the risk increases the longer you delay,” said Baker.

Darren Kimura, CEO of Honolulu-based Sopopy, a solar thermal company that’s planning to bid on the RFP, said that his project costs have gone up 25 percent to 30 percent since HECO released the initial draft of the RFP months ago.

As of now, Kimura said that the project is no longer attractive to investors. As the economy has recovered, construction costs have gone up, and state tax credits have been scaled back.

“Based on what we thought back then, and the costs going up and the tax credits going down, what we are seeing is that it is out of the money right now,” he said.

Kimura said that three of his seven investors pulled out last year.

“They just said ‘no way,’” said Kimura. “That’s super spooky for me. Investors not being there when you need them to be there, that is a really bad situation.”