Honolulu's Hawaiian Electric announced an agreement to get biodiesel from Seattle-based Imperium Renewables [1].

Imperium opened its first biodiesel plant in Grays Harbor, Wash., in August, which can pump out 100 million gallons a year (see Imperium gets big with biodiesel [2]).

"We look forward to helping the state of Hawaii reduce its dependence on petroleum and achieve a more sustainable and self-sufficient energy future," said Martin Tobias, CEO and chairman of Imperium.

The company plans to build another 100 million gallon facility on Kalaeloa Harbor in Hawaii. The new plant is expected to supply between 5 million and 12 million gallons of biodiesel per year to Hawaiian Electric through 2011 under the new contract.

The fuel will be used in the electric utility's planned 110 megawatt Campbell Industrial Park generating station.

Financial terms of the contract were not disclosed.

Imperium said it would work with Hawaiian Electric and others to promote the development of a local agricultural energy industry to supply Hawaii-grown feedstock. The Grays Harbor plant uses Canola oil.

Construction of the Campbell generating station is expected to begin in early 2008, with operations set to go online by mid-2009.

Imperium is pursuing permits for it's Hawaii plant.