Hawaiian Electric Co. warned customers today that electricity bills will climb higher over the next few months due to U.S. sanctions on Russian oil.
The utility is forecasting residential bills will rise about 10% for Oahu customers, and about 20% for those on Maui County and Hawaii island, in the next few months.
“The increases we’re anticipating are more abrupt than we’ve seen before and, on top of the inflation we’ve all experienced in recent months, I know they will impact the budgets of many households,” said Joe Viola, senior vice president of customer, legal and regulatory affairs, in a news release. “We hope that by letting customers know what’s coming this helps households and businesses plan budgets and reduce energy use.”
President Joe Biden announced Tuesday that the U.S. would ban all Russian oil imports in response to its invasion of Ukraine, while acknowledging it would come at a cost to Americans, particularly at the gas pump.
Gas prices have already been rising for weeks, with the average price in Hawaii currently at $4.81 per gallon, according to AAA, compared to a national average of $4.31 per gallon for regular unleaded.
On Oahu, the average price is at $4.71 per gallon. On neighbor isles, prices are even higher, at $5.04 per gallon on Kauai, $4.98 per gallon on Maui, and $4.93 per gallon on Hawaii island.
The formula for customer electricity rates, meanwhile, is regulated by the state Public Utilities Commission and includes fuel costs that fluctuate with world markets.
Hawaiian Electric said it makes no profit on the fuel used to generate electricity, and that under a fuel-cost risk-sharing regulatory mechanism, the company’s shareholders are required to pay some of the cost when oil prices rise too high, resulting in a slightly lower rate for customers.
Hawaiian Electric reminded customers of available options to help manage energy bills via hawaiianelectric.com, along with tips on saving energy and money. Hawaii Energy, a ratepayer-funded energy conservation and efficiency program, also offers energy-saving tips and rebates at hawaiienergy.com.
“We hope this is the peak and that by summer we could see some relief,” Viola said in the news release. “There’s a lot of uncertainty and if the international situation remains in turmoil, the price could surge higher.”