Merger ‘in best interest’ of state and customers

NextEra Energy Inc. is holding its ground as it faces criticism from the state.

The Florida-based company said Tuesday it is committed to its proposal to buy the state’s largest electric utility despite Gov. David Ige recommending the sale be rejected.

Ige repeated his stance, speaking out against NextEra’s purchase of Hawaiian Electric Industries, during a press conference Tuesday at the Capitol. On Monday the governor said in a statement he was opposed to NextEra’s purchase of the parent company of Hawaiian Electric Co., Hawaii Electric Light Co. and Maui Electric Co., recommending the state Public Utilities Commission reject the deal.

“The merger, as proposed at this point, is unacceptable,” Ige said at the conference.

NextEra Energy said Tuesday its $4.3 billion purchase of HEI’s utilities is in the public interest, as the deal would result in savings for electrical customers and support Hawaii’s energy goals.

“NextEra Energy and the Hawaiian Electric Cos. believe that this merger truly is in the best interest of the state of Hawaii and, in particular, Hawaiian Electric’s customers,” said Rob Gould, spokesman for NextEra. “We have made commitments to employees, community causes and for the establishment of a local independent advisory board, and we will listen to and work with all stakeholders to achieve what’s best for the state of Hawaii and Hawaiian Electric’s customers.”

NextEra said that further review will reveal more benefits the deal can bring to Hawaii.

“We 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,” Gould said.

HECO echoed NextEra’s position in a news release Tuesday afternoon.

“As more information is provided throughout this process, we feel strongly that others will also conclude that this partnership with NextEra Energy will result in significant benefits for our customers and for Hawaii’s leadership in clean energy,” said Alan Oshima, president and CEO of HECO.

But — as the application stands — NextEra just won’t do for Hawaii, Ige said.

Ige said the shift of control to a board of directors that is 5,000 miles away, NextEra’s failure to commit to the state’s clean-energy goals and its track record with distributed generation, such as rooftop solar, were major concerns for the state.

There are about 3,000 customers at NextEra’s Florida utility with rooftop solar divided among the utility’s 4.8 million accounts. HECO has approved almost 70,000 rooftop solar systems across Maui, Oahu and Hawaii island out of a total of more than 450,000 customers.

Ige signed into law last month a bill that sets a goal of 100 percent of the state’s electric power coming from renewable energy sources by 2045. The governor said NextEra’s answer during the PUC review regarding whether the company could help Hawaii reach that goal was unsatisfactory.

“The response to that question was vague and noncommittal,” Ige said. “We are looking for a partner that shares our hopes and dreams as it comes to electricity generation going forward.”

In its defense, NextEra said it would use its expertise to boost the state’s status as a leader in renewable energy.

“NextEra Energy and its extensive renewable energy expertise and resources will strengthen and accelerate Hawaiian Electric’s clean-energy transformation as well as the company’s support for Hawaii’s goal of 100 percent of the state’s electric power coming from renewable energy sources by 2045,” Gould said.

Gould said the company’s filings in the review process demonstrate more than $600 million in economic benefits in the first five years after the sale closes.

Previously, NextEra promised to speed up the 2030 energy goals that HECO proposed in August, which include lowering customer bills by 20 percent, renewable energy reaching 65 percent of the utility’s energy mix and tripling rooftop solar.

Ige revealed his stance Monday as two state agencies among the 28 approved “intervenors” filed testimony that day with the PUC. The result of the filings showed a majority opposed the acquisition. A few recommended the PUC enforce conditions on the company before moving forward, and two suggested alternatives to NextEra’s ownership of HECO. No intervenors fully supported the deal.

The governor said the PUC review process creates an opportunity to shape the electrical utility that is the best fit for Hawaii, and NextEra’s business model does not fit that role.

“We believe the business model should be … one that encourages distributed generation (and) encourages personal ability (for customers) to generate their own electricity off of their own rooftops — all which are opposite to the business model embraced by NextEra,” Ige said.

The governor gave NextEra an opportunity to redeem itself, noting the early state of the PUC review process.

“I am certain this is not the last page written on this merger,” Ige said. “The PUC has set up a number of further actions in this docket.”

In June, PUC Chairman Randy Iwase said he has his sights set on June 2016 for the final decision on the sale of HEI to NextEra.