Net income for Hawaiian Electric Industries Inc., the holding company for the state’s largest utility and American Savings Bank, was down roughly 1 percent in the third quarter due to additional operations expenses at the utility and loan losses at the bank, the company said Thursday.
HEI’s net third-quarter income was $47.8 million, or 46 cents per share, down from $48.2 million, or 48 cents per share, in the third quarter of 2013.
Revenue for the utility was $8 million higher compared with the third quarter of last year. Recovery of costs for clean energy and reliability investments as well as better fuel-efficiency performance contributed to the increase, said HECO.
The drop in net income was due to "increased consulting costs associated with recent regulatory filings, storm restoration expenses and the initial phase of our smart grid installations as part of our grid modernization program," the company said in a news release.
The operations and maintenance expenses — which included consulting costs and the damage caused by Tropical Storm Iselle in August — were $2 million higher in the third quarter of 2014 compared with the same quarter last year.
"We are proud of our dedicated utility company employees who worked tirelessly to restore power and help customers after Tropical Storm Iselle while completing our energy plans on time," said Constance Lau, HEI president and chief executive officer.
In August the utility submitted a Power Supply Improvement Plan in response to repeated orders by the state Public Utilities Commission to develop a more sustainable business model.
The electric utility submitted its 2,731-page plan outlining how the utility would cut Hawaii’s dependence on fossil fuels, incorporate more renewable energy sources and lower customer bills.
"At the utility, we continue to work aggressively to lower customer bills by reducing Hawaii’s dependence on imported oil," Lau said. "The recent energy plans we filed with the PUC are providing the starting point to launch important initiatives with a broad set of stakeholders to achieve our shared vision for Hawaii’s clean energy future."
The earnings report included the three utilities Hawaiian Electric Co. Inc. on Oahu, Maui Electric Co. Ltd. and Hawaii Electric Light Co. Inc.
American Savings Bank’s net income for the third quarter was $13.3 million compared with $15.3 million in the third quarter of 2013.
The $2 million decrease was primarily driven by loan losses combined with lower fee income on other financial products and mortgage banking income, HEI said.
