By Jeff King
It could have been one of the biggest business deals in Hawaii’s history. But with two votes – and one abstention – history of another kind was made in Honolulu today.
Hawaii’s Public Utilities Commission today turned down NextEra Energy Inc.’s proposed $4.3 billion purchase of Hawaiian Electric Industries Inc.
The vote was 2-0 with PUC Chairman Randy Iwase and Commissioner Lorraine Akiba voting to reject the sale. Commissioner Tom Gorak abstained. PUC approval was needed for the companies to close the deal. Maui Electric Company, along with island-wide utilities on O’ahu and the Big Island have long awaited the decision.
So have leaders of the renewable energy industry across the state.
Hawaiian Electric Industries (HEI) operates and controls utilities on Maui, O’ahu and the Big Island.
Gov. David Ige commented, “I want to thank the Public Utilities Commission and stakeholders for their participation in this historic process. This ruling gives us a chance to reset and refocus on our goal of achieving 100 percent renewable energy by 2045. The proceeding helped define the characteristics and parameters of Hawaii’s preferred energy future. We look forward to creating a process to find the best partner in the world.
“No matter who owns the company, the energy vision for Hawai‘i remains very clear – 100 percent renewable energy with a transformation to a customer-centered utility focusing on smart meters, smart grid, distributed local solutions, and as much consumer choice as possible.”
NextEra, based in Juno Beach, Florida, announced in December 2014 its plan to run Hawaii’s largest utility which provides power to 95 percent of Hawaii residents. The original plan called for HEI’s bank subsidiary, American Savings Bank, to be spun off and run as a stand-alone company.
NextEra conducted a 19-month campaign to win approval of the deal. NextEra argued it was a better alternative for Hawaii because it could offer lower rates and a quicker path to the state’s goal of achieving 100 percent renewable electricity production. NextEra promised to lower electric bills — the highest in the nation — by about $70 a year over the next five years and to not lay off employees for two years.
Opponents of the sale — including Governor Ige, environmental groups and solar power companies — argued the state’s largest utility should not be run by company based in Florida, which would view Hawaii as a small part of its operations. They also questioned NextEra’s commitment to 100 percent renewable energy, especially in light of its plan to convert power plants to liquefied natural gas and the small amount of rooftop solar in use in Florida.
Parties involved in the case could file a motion with the PUC for reconsideration or file a motion to appeal the PUC decision with the Hawaii Supreme Court.
The PUC’s decision came just weeks after Ige changed the makeup of the three-member commission. On June 29, Ige appointed Tom Gorak, PUC chief counsel, to take the place of outgoing Commissioner Michael Champley. Ige said Gorak’s views were more aligned with Ige’s. State senators have questioned whether Ige had the authority to make that change without the approval of the senate.