Lower power bills broached

Legislators pressed NextEra Energy Inc., the Florida-based energy company hoping to purchase Hawaiian Electric Industries, for details of how the mainland company will lower electric rates and by when.

NextEra Energy said in December it plans to buy HEI, the parent company of the state’s major electric utilities, Hawaiian Electric Co., Hawaii Electric Light Co. and Maui Electric Co., for $4.3 billion. The deal needs to be approved by the state Public Utilities Commission and is expected to close later this year.

At a Capitol hearing Wednesday, Eric Gleason, president of NextEra Energy Hawaii, and Alan Oshima, president and chief executive officer of HECO, promised the pending purchase would help accelerate the goals HECO listed in its energy transition plan submitted in August, including lowering customer bills by 20 percent and tripling solar by 2030.

Sen. Rosalyn Baker, (D, South and West Maui) chairwoman of the Committee on Commerce and Consumer Protection, pushed for a timeline for cutting bills, as "people are worried about rates now."

If the "acquisition went through tomorrow, that doesn’t necessarily mean that these other things are going to happen in a short order, correct?" Baker asked.

Oshima said the decrease in rates would not be immediate but that NextEra would be able to help HECO achieve 20 percent-lower bills sooner than the 2030 goals. NextEra has said its superior credit rating will help cut HECO’s borrowing cost, and that those savings could be passed on to consumers, but that it cannot be specific about how much rates will decline and by when.

"We are going to need to see a lot more of those details," Baker said, adding that she also wants to know that the utility will be run from Hawaii.

"We are looking for some assurances that the things that are important to Hawaii … are going to be honored. So can you give us a sense of what kind of decisions will be made in Hawaii by Hawaii people."

NextEra promised that HECO headquarters will be local and that the management will be here.

"Hawaiian Electric will still be a Hawaii organization under the laws of Hawaii and under the regulation of the PUC," Oshima said. "All of the regulation of the company will remain in Hawaii." 

Gleason echoed Oshima’s promise that local views would be considered.

"It would be irrational of us to come in and think we have the answer," Gleason said.

Rep. Cynthia Thielen (R, Kailua-Kaneohe Bay) asked what the nation’s largest clean energy company can offer the independent-minded state, noting Hawaii has 50,000 homes with rooftop solar.

Gleason said that NextEra does not believe in a one-size-fits all state.

"Hawaii does not aspire to be Florida," Gleason said. "Hawaii has its own objectives."

Rep. Angus McKelvey (D, Lahaina-Kaanapali-Kapalua-Maalaea-Kihei-North Kihei) voiced concern about what would happen after Next­Era’s promised two years of no layoffs among the utility’s workforce.

Gleason said that lowered bills would come from clean energy adoption, and not a cut in labor force.

"It would be very disheartening to see it come off of the labor side," McKelvey said.

The companies said their application for approval of the purchase will be filed with the Public Utilities Commission Thursday.