The state Public Utilities Commission chastised Hawaiian Electric Co. for a second time over the utility’s plans to terminate contracts for three large-scale solar projects.

In a staff report released Tuesday, the PUC said HECO’s ending its contracts with SunEdison Inc. for three solar farms that would have generated 112 megawatts of power “cannot be viewed as serving the best interests of the state or the people of Hawaii.”

HECO filed a formal letter in February to end its contracts with Maryland Heights, Mo.-based SunEdison. The solar farms were set to go online by the end of the year and would have sold solar power to HECO for approximately 14 cents a kilowatt-hour for the duration of their 22-year life spans. HECO canceled the projects because SunEdison did not meet project milestones and is in a shaky financial situation.

The PUC staff said HECO acted hastily and without in-depth analysis of perceived bankruptcy concerns.

“Not only did this not occur but there appeared — and appears — to be no urgency on the part of HECO to at least attempt to have these three projects go forward,” the PUC said. “Rather, it is clear that HECO has decided that termination is the alternative that it intends to pursue.”

“We invested a lot of time and resources on these projects for close to three years,” HECO spokesman Darren Pai said. “The decision to terminate these contracts was an extremely difficult decision that we did not make lightly.”

The PUC report was prepared at the direction of Chairman Randy Iwase, who blasted HECO for terminating the contracts in February. Iwase said he was concerned with the impact the termination of the contracts would have on HECO’s ability to reach the state’s 100 percent renewable goal and on Hawaii’s reputation as a place to do business.

“Who would want to come in under those circumstance?” Iwase said. “Who would want to deal with a company that could do that?”

In March, New York-based D.E. Shaw, a global investment and technology firm, said it would seek to buy the SunEdison projects within seven business days of HECO reinstating the contract, it would begin construction within 12 weeks of the purchase closing and it would offer concessions of $10.9 million to HECO.

“We all knew the SunEdison ship was sinking at the harbor,” Iwase said. “Another ship (D.E. Shaw) is coming in. It’s better, it’s big and the harbor master shut the harbor.”

Iwase said the PUC can’t force HECO to reinstate the projects. “We cannot intrude in private contracts,” he said. “If they (HECO) come in to seek to cover some costs related to these projects, if there are litigation costs, if litigation in fact occurs between the parties and they seek to pass it through to the ratepayers, we are going to review it with an eye on public interest.”

HECO said the problem is that D.E. Shaw is a creditor of SunEdison.

“A bankruptcy court could question why D.E. Shaw received negotiating rights when other creditors did not,” Pai said.

Pai said that HECO told D.E. Shaw it is willing to discuss a formal proposal that addresses its concerns about a possible SunEdison bankruptcy.

The two agreed to meet at the end of the month.