Economic Impact of the Natural Energy Laboratory Hawaii Authority Tenant on the State of Hawaii in 2018

NELHA contracted the University of Hawaii Economic Research Organization (UHERO) to estimate its economic impact on the State of Hawaii. To estimate expenditures made by NELHA tenants in 2018, UHERO researchers developed a survey where expenditures were broken down into 17 named categories and respondents were asked to provide total expenditures in 2018 and the share of these expenditures that were paid to Hawaii vendors. UHERO received responses from 36 NELHA companies (out of 44). Expenditure levels for the survey non-respondents were estimated using various techniques. Total NELHA tenant expenditures were estimated at $92.4 million, of which approximately $64.5 million (or 70%) were paid to Hawaii entities. Following a standard approach, UHERO defined economic impact to be the direct, indirect, and induced economic activities generated by the tenant’s spending in the Hawaii economy. The 2012 20-sector State Input- Output (I-O) model of the State of Hawaii prepared by the Hawaii Department of Business, Economic Development and Tourism (DBEDT) was used to evaluate these impacts. The impact of NELHA’s in-state expenditures in 2018 on the State’s output (sales), earnings, and tax revenues was estimated to be $103.6, $25.5, and $4.8 million respectively. Furthermore, not only do NELHA tenants employ hundreds of people but their expenditures also contribute to hundreds of other jobs in the larger Hawaii economy (509 total excluding NELHA employees; NELHA itself employs an additional 17 people).

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