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NextEra must adopt state’s goals

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In raising valid concerns about the proposed sale of the state’s largest electric utility, Gov. David Ige has thrown down a gauntlet to NextEra Energy Inc., sending a strong message that state authorities will not support the Florida-based company’s proposal to acquire Hawaiian Electric Industries.

If NextEra intends to proceed with the merger, it will have to demonstrate, much more convincingly than it has, that its plans for HEI align with the state’s clean-energy goals.

To do so, NextEra executives will have to be more forthcoming with answers to questions posed by numerous Hawaii entities as part of the state Public Utilities Commission (PUC) review of the merger application.

Two state agencies, the Office of Planning and the Department of Business, Economic Development and Tourism (DBEDT), concluded that answers provided to questions by intervenors in the PUC case were insufficient.

For its part, NextEra seems undeterred by Ige’s statement on Monday that the state’s initial doubts about the merits of the acquisition not only remain, but “are stronger today.”

In an official response the following day, company spokesman Rob Gould said NextEra executives “are optimistic that as the regulatory process continues, we will find more common ground and further demonstrate the strong public interest benefits of this merger.”

That will take some doing. While there are reasons to think NextEra’s size and experience with clean energy could move Hawaii forward in its goals, the company still depends primarily on fossil fuels and has demonstrated in other markets that it favors owning the means of power generation.

Hawaii has encouraged independent energy producers to thrive, and would like to maintain that level of competition in its marketplace.

Furthermore, NextEra already has issued a less- than-enthusiastic reaction to the state’s newly adopted goal to achieve 100 percent renewable-energy production by 2045. The target, executives said earlier, “may prove to be very aggressive.”

That may be. But the new policy, only days earlier signed into law, lays a hard foundation under the clean-energy aspirations that can turn into long-term benefits for Hawaii — in this case, moving away from imported fuel sources, both for economic reasons and to counter the causes of climate change.

If NextEra expects to take the helm of such an important part of Hawaii’s economy, the state needs to know that the company supports and will follow the course Hawaii has set.

Distancing itself from a landmark energy law just signed by the governor is no way to persuade PUC members, particularly chairman Randy Iwase, an Ige appointee.

Mark Glick, administrator of the State Energy Office under DBEDT, underscored the state’s expectation that the new energy policy will “drive an energy transformation.”

“It is imperative that all necessary and interested parties and agencies work collaboratively to achieve this laudable mandate,” Glick said in testimony to the PUC.

Leo Asuncion, acting director of the state Office of Planning, compounded that concern with worries about the job losses from the merger, once a promised two-year moratorium on workforce reductions passes.

Some of the most troubling observations came from Scott Hempling, a consultant to the planning office, whose testimony cast doubt on the basic compatibility of NextEra and Hawaii’s needs in a power utility.

“NextEra has a ‘business model’: Own vertically integrated monopolies, then seek competitive advantage in the markets served by those monopolies,” Hempling wrote.

“But that model conflicts with Hawaii’s need for diversity and competition. Indeed, NextEra has said explicitly that customer choice is a negative for its bottom line.”

If NextEra hopes to overcome that general suspicion about its intentions, it had better start talking seriously with the state’s key policymakers, who are advocating for what’s in Hawaii’s best interest — and rightly so.

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