A state Senate committee plans to hold a hearing this week on the Public Utilities Commission’s decision to grant Pasha Hawaii Transport Lines permission to carry cargo through the islands on an interim basis through 2013.

Senate Committee on Commerce and Consumer Protection lawmakers are having a hearing at the state Capitol on Thursday to ask how the decision may affect neighbor island residents and businesses.

The PUC says the move will foster competition and provide customers with choice.

But the state’s existing interisland ocean carrier — Young Brothers Ltd. — says the decision will lead to a decrease in service and an increase in cargo costs.

Young Brothers says it may have to reduce its twice-weekly service to Hilo and Kawaihae.