In a state like Hawaii, where costs for public utilities are high and the pressure to keep rates in check is even higher, it’s never an opportune moment for a changing of the guard at the government agency in charge of managing all this.
But this particular juncture presents particular challenges for whoever is named to head the three-member panel, a vacancy left with the departure of Hermina Morita, chairwoman since her 2011 appointment by then-Gov. Neil Abercrombie. Commissioners contend with numerous weighty issues affecting all levels of business and ordinary life in Hawaii. It would be difficult even if the PUC had adequate staffing to do the research to inform its decisions, which it doesn’t.
So Abercrombie’s successor, Gov. David Ige, must set the bar high when considering who should take over the helm. Technology is swiftly altering the landscape in the industries the PUC regulates — transportation and telecommunications are among them — but without a doubt it is the energy sector where the revolution has taken place, and is still unfolding.
Deciding whether and how to expand the segment that liquefied natural gas represents in the state’s energy portfolio will require a well-informed commission, chaired by someone with experience.
In particular, however, the most pressing concern for Hawaii consumers and businesses in the immediate future is the fate of the principal electric company.
The proposed acquisition of Hawaiian Electric Industries by NextEra Energy has its upside: NextEra is an entity with the capacity and experience to advance the state’s general clean-energy goals, especially where solar power is concerned. But most observers of its operations in the Florida market especially are afraid it would do so in a more centralized way, the utility being in control of most energy production.
NextEra would be entering a marketplace where smaller solar companies have gained a foothold, enabling the generation of power by individual homes and businesses. Any transition to a new model will require oversight by the PUC to ensure that the best interest of the ratepayers overall is defended. And the beneficiaries at issue must include those unable to afford to front the money for their own solar installation.
Clearly, without strong advocacy by the PUC, the ratepayers can’t feel confident that they won’t be bearing the brunt of such changes. A lot of hard questions must be put to officials of HEI and its subsidiaries before that sale can be approved.
Morita came under fire for one reason unrelated to the PUC: a violation for an illegal vacation rental on Kauai, for which she paid a fine. But there was at least one flash point that may have been a reason that Abercrombie did not reappoint Morita to a second term, though he did extend her in the position on an interim basis.
Morita’s commission twice rejected a contract for a biofuels plant to be built by Aina Koa Pono, a company with supporters within the administration.
However, those decisions were based on concern about the plant’s fuel costs being too high for ratepayers. It’s exactly that kind of orientation that the commission needs in the person holding the chair, and in the other two members as well.
The PUC is about to embark on a pivotal period in the state’s utilities regulation. The Legislature ought to revisit its staffing budget, to ensure that the PUC has the technical support this agency needs to do its difficult job.
Above all, it needs leadership with the right priorities: keeping utility rates within reasonable bounds for the public, already burdened in high-cost Hawaii.
