The state Public Utilities Commission will decide four major cases, or dockets, relating to Hawaii’s energy landscape before it rules on NextEra Energy Inc.’s proposed purchase of Hawaiian Electric Industries.
It’s dealing with those four dockets that could push the PUC’s decision on the sale of Hawaii’s largest utility beyond the end of 2015, when the two companies had hoped to close the sale.
Those four cases are significant documents affecting how Hawaiian Electric Co. "will deal with the changing world of power distribution and the generation of power," said PUC Chairman Randy Iwase in an interview with the Honolulu Star-Advertiser.
Iwase, who took office in January, said, "The four dockets have been sitting here for a while. When I came in, I told my staff we have to move them — the four dockets."
Iwase said he expects the review process for the four filings to be complete by the end of the year.
"I’m hopeful for the end of the year — sooner than that, if possible," Iwase said.
Iwase said that PUC review of the sale of HEI to NextEra would take a year to 18 months because the decision "ripples out far beyond the merger and ratepayers."
"There are a lot of issues in there," Iwase said. "We need to take more time."
On Jan. 29, Juno Beach, Fla.-based NextEra Energy and HEI asked the PUC to approve the sale of the parent company of the state’s major utilities — Hawaiian Electric Co., Maui Electric Co., Hawaii Electric Light Co. — to NextEra for $4.3 billion.
The four cases Iwase wants completed before ruling on the sale are:
» HECO’s plan to adopt more renewable energy: Filed in August, the Power Supply Improvement Plan describes HECO’s long-term outlook for its grid with a goal of using 65 percent renewable energy in its energy mix by 2030 and using liquefied natural gas as a bridge fuel away from fossil fuels.
» HECO’s plan to connect more rooftop solar: The Distributed Generation Interconnection Plan reviews another HECO August filing. This is a more technically focused docket that shows how the utility would allow more customer generation and interconnection, such as rooftop photovoltaic systems. The utility added to this docket in January when it requested to lower the amount it paid customers for the excess energy residential rooftop solar systems send to the grid. In the same request, HECO announced it could double the amount of rooftop solar it allows in areas with high numbers of customer solar systems already connected.
» A review of the way HECO charges customers: The PUC began this investigation in 2013 into the "decoupling mechanism," or the policy that separates the money HECO makes from the amount of energy customers use, which has resulted in a steady increase in rates. Decoupling shows up on HECO bills as a line item labeled "RBA rate adjustment" for revenue balancing account. For a typical bill it is about $13 a month. The PUC could impose more controls on the policy, making it so the rates don’t increase automatically.
» HECO’s program to pay customers for allowing the utility to shift customer energy use during certain times of the day: The fourth docket on Iwase’s list is a review the commission filed in 2007 to look at HECO’s "demand response program" that offers payments to utility customers who allow the utility to manage all or a portion their home’s energy use during certain times of the day.
These dockets need to be moved because they outline Hawaii’s energy landscape and would have an impact on how the PUC would review the NextEra case, Iwase said.
It is important to be mindful of the best interest of all of utility stakeholders — solar customers and customers without solar as well as HEI’s shareholders — as the commission reviews the four dockets, Iwase said.
The Alliance for Solar Choice, Blue Planet Foundation, Hawaii PV Coalition, Hawaii Solar Energy Association and Sierra Club of Hawaii had asked the PUC to rule on HECO’s August plan for Hawaii’s clean-energy future before reviewing the NextEra proposal. They are pleased Iwase has decided to do that.
Jeff Mikulina, director of Blue Planet Foundation, said he is encouraged to see the PUC is moving foward with utility plans to transform despite having to review the HEI sale.
"We are creating a framework for a utility that is based on performance, clean energy and customer satisfaction," Mikulina said.
Isaac Moriwake, attorney for Earthjustice, echoed that sentiment.
"It’s good that the PUC heard what we’re trying to emphasize," Moriwake said. "There are certain foundational issues here that we need to address that directly relate to the merger."
