Gov. David Ige now opposes the NextEra takeover of Hawaiian Electric. The Maui mayor and Honolulu City Council chairman are interested in nonprofit customer ownership of the Hawaiian Electric Industries (HEI) utilities in their respective counties — similar to the 13-year-old Kauai Island Utility Cooperative and hundreds of electric cooperatives on the mainland. Maui’s mayor has authorized expenditure of $30,000 to assess this possibility, and the Honolulu Council chairman has introduced a resolution to authorize the county government to study this.

The Honolulu Council’s chairman also is interested in possible nonprofit municipal (i.e., taxpayer) ownership. Meanwhile, a group called the Hawaii Island Electric Cooperative (HIEC) is reviewing nonprofit public ownership options, as is KULOLO (Keep Our Utilities Locally Owned and Locally Operated). The latter also wants the governor to consider nonprofit ownership.

I agree.

Under nonprofit public ownership, dividends currently paid to HEI shareholders, any taxes currently paid by HEI as a for-profit company, and customer payments to HEI invested elsewhere by HEI to increase dividends for its shareholders, could instead be either returned to customers and/or invested in more renewable energy, energy efficiency and/or storage improvements — after these revenue streams are first used to pay for a customer and/or taxpayer buyout of HEI.

So, before the Public Utilities Commission rules on the NextEra takeover next year, a rigorous, politically independent study is needed to compare the pros and cons of nonprofit customer ownership, nonprofit municipal (taxpayer) ownership, and continuation of for-profit monopoly ownership by NextEra or HEI. That includes estimation of the true fair market value of the HEI utilities, and the feasibility of using eminent domain to convert HEI utilities to nonprofit ownership.

Further, this study also should identify — and try to determine the feasibility of — other possible funding sources for a customer and/or taxpayer buyout of Hawaiian Electric, in addition to the possible revenue streams described above. These might include debt, equity and/or on-bill financing, as well as tax or other incentives in exchange for transferring ownership from HEI to customers and/or taxpayers.

Finally, some think traditional centralized electric utilities — both for-profit and nonprofit — may be facing a death spiral as decentralized electrical generation and storage technologies continue to improve and decline in cost, including better, cheaper rooftop solar and battery storage, as well as next-generation micro-wind generators. This means ever-more electricity customers may find it cheaper to disconnect completely from the grid. If so, HEI may be forced to increase rates for its remaining customers in order to maintain profitability for its shareholders and high-priced executives.

As a result, a feasibility study should also attempt to estimate the cost of using the aforementioned funding sources to simply pay the declining number of future HEI customers who cannot afford the upfront investment to go “off the grid” and compare that with the cost of a customer and/or taxpayer buyout of the HEI utilities.

If some type of grid is still necessary in the future, more decentralized micro-grids and nano-grids might be cheaper to maintain and be more reliable than our current aging electricity distribution networks.