NELHA, the Natural Energy Laboratory of Hawai'i Authority, is leaving DBEDT.

Established in 1974, NELHA was "attached" first to UH and later to DBEDT. But the budget passed by the 2009 session changed all that — it moved NELHA to DAGS, the Department of Accounting and General Services.

This move reveals the breakdown NELHA has had with DBEDT. It also bears the promise of better times for NELHA.

WATER EVERYWHERE

NELHA's name reveals its purpose — a natural energy laboratory with research in ocean technologies. Although it started with 345 acres, it expanded to 877 acres when merged with the Hawai'i Ocean Science and Technology Park in 1991.

By the time of the merger, ocean thermal energy conversion (OTEC) research had been going on there for 15 years. The federal government spent some $250 million on it, but by the mid-1990s energy was no longer in vogue. The research stopped and the plant was dismantled, leaving only the deep sea pipelines built for OTEC.

SELF-SUSTAINING

When elected in 2002, Linda Lingle required the attached agencies to be "self-sustaining," and she cut their funding. This policy distracted those agencies, including NELHA. Research agencies have difficulty earning their own keep, but she nevertheless continued the policy. The result is that NELHA has been scrounging to pay its expenses and maintain its facilities.

DBEDT's answer was that NELHA should sell its deep sea water to bottling companies for sale in Japan. So NELHA gave long-term leases to a number of water bottling companies — a far cry from science. These leases provide income for NELHA, but will tie up 50 acres of NELHA's land for decades to come.

RE-ENTER SCIENCE

In 2005, one of the bottlers hired away NELHA's executive director. Ron Baird, who has a business and tech background, was found to replace him. NELHA has flourished under Baird. Despite its struggle with DBEDT, NELHA has been attracting world-class scientists, organizations and alliances.

Makai Ocean Engineering, working with Lockheed Martin, has restarted OTEC research, and is building a new OTEC facility. Aquaculture is thriving. Cellana, funded by Shell Oil, is doing world class research on biofuel algae. Sopogy is completing a solar energy farm. That's only a small part of what's going on.

DBEDT "APATHETIC"

NELHA was established with its own board to manage itself. It was not enough that Linda Lingle could appoint three directors — DBEDT also micromanaged things, making it increasingly difficult for NELHA to get anything done.

As a tech park, NELHA needs prompt procurement. Instead of helping NELHA deal with the tribulations of the Procurement Code, DBEDT has been a roadblock. NELHA's critical pipelines were broken by the 2006 earthquake, but it took 2 1/2 years to get a repair contract through DBEDT.

The harder NELHA tried, the more impacted things got at DBEDT. A state audit released in April said DBEDT was "apathetic." No one can say that Director Ted Liu favors science — he has alienated the industry and has made DBEDT an obstacle to NELHA's progress. If NELHA is to pursue science, it must escape from DBEDT. Both agencies knew that, and apparently so did the Legislature.

A BETTER MATCH

A bill moving NELHA to DCCA failed last year. This year, Marcus Oshiro added provisions to the budget to strip a number of agencies away from DBEDT. The one that survived was the one that moved NELHA to DAGS. It's a great time for the move — the transition teams are in place, and they meet weekly.

NELHA has in-house expertise on energy. It could help DAGS power state buildings with PV and sea water air conditioning funded by the energy bills passed this session. With its pipelines, NELHA has had the benefit of sea water air conditioning for more than 20 years, and is planning to install that system at Kona Airport, a perfect collaboration between agencies.

BRILLIANT FUTURE

NELHA is building science in Hawai'i. Some say it's becoming the Silicon Valley of Hawai'i, the home for research we had hoped for Kaka'ako. We can't afford to lose it or lose ground. It has become our tech park, promising in food, energy and healthcare. We need to protect it from bureaucracy, as well as activism.

The move is good, and good for tech. Linda Lingle should not veto this move. If she does, the powers in the Legislature should put it on the "short list" for override, to show that there is a place for science in our state government. For a brilliant future, NELHA needs a fresh start.

Jay Fidell is a business lawyer practicing in Honolulu. He has followed tech and tech policy closely and is a founder of ThinkTech Hawaii. Check out his blog at www.HonoluluAdvertiser.com/Blogs