- Special Projects
The Hawaii Public Utilities Commission heard an unfamiliar sound Tuesday evening — strong support for the proposed $4.3 billion sale of Hawaiian Electric Industries to NextEra Energy.
The commission wrapped up its seven-stop statewide public listening session tour at McKinley High School, hearing more than 100 people offer their thoughts on the merger agreement.
Unlike on Maui and the Big Island where members of the public overwhelmingly opposed the deal, the Oahu residents who testified were far more evenly split.
NextEra got a big boost from union workers who negotiated a deal with the company earlier this month that guarantees current contracts will be honored.
The deal with International Brotherhood of Electrical Workers Local 1260 ensures NextEra would train current and future members for new jobs and not lay off anyone for at least two years after the sale goes through.
IBEW has since asked to be removed as one of the 26 intervening parties in the merger docket, saying it now fully supports the acquisition since its conditions were met.
Pacific Resource Partnership and other groups representing unionized carpenters also showed up to support the sale, many with prepared testimony that at times read like the back of a NextEra brochure.
“We should not let fear chase this great opportunity away,” said Brooke Wilson, representing PRP.
On the outer islands, there was a strong chorus calling on the PUC to reject the merger in large part because NextEra is a huge corporation based in Florida. On Tuesday, however concerns over a mainland firm “taking over” one of Hawaii’s oldest companies were outnumbered by comments on how NextEra understands “local culture” and Hawaiian values.
Native Hawaiian students from St. Louis High School and Kapiolani Community College were among those who testified in favor of the merger, basing their support on beliefs that NextEra would help lower electric bills to reduce the cost of living in Hawaii.
NextEra estimates a savings of roughly $345 to $475 per residential customer over the first five years after the sale goes through.
It was hardly unanimous support, however, even among Hawaiians.
Billy Souza pointed at how it was the Hawaiian Kingdom that gave Hawaiian Electric the building where it’s still headquartered so it could work on bringing electricity to the islands, even powering the palace before the White House.
“I’ve come here to stop the bleeding,” he said, noting how similar the pitch for the utility merger sounds to the benefits that city officials touted when selling the Honolulu rail project to the public.
There were supposed to be jobs and costs contained, he said, but instead the rail project is now more than $1 billion over budget.
Solar company executives and others also came out in opposition, explaining the “mistruths” that the “spin doctors” have spread through a coordinated campaign to convince the public that NextEra’s deeper pockets and experience in renewable energy should carry the day.
Rob Gould, spokesman for NextEra, said after the listening session Tuesday that it’s been interesting to see the evolution of the listening sessions.
“As more and more people learn about the potential benefits of the transaction, they’re more inclined to support it,” he said. “What is still troubling to me is that there are those who seem to have a view of our company that just doesn’t align with reality.”
Gov. David Ige’s administration remains opposed to the sale, finding it not to be in the public interest after a thorough review of the application. He’s criticized NextEra for not being more forthcoming with specific plans on how the company would help the state reach its going of getting 100 percent of its electric generation from renewable energy sources by 2045.
Members of former Gov. Neil Abercrombie’s administration, testifying on behalf of themselves, supported the merger.
Kealii Lopez, former director of the Department of Commerce and Consumer Affairs, said NextEra’s ability to borrow money at lower rates than Hawaiian Electric will benefit customers.
“NextEra clearly has access to resources that need to be invested in the HECO infrastructure to ensure that we have a system that is going to be resilient and capable of taking on the new forms of energy,” she said.
NextEra has made 85 commitments to try to sway the governor and state Consumer Advocate Jeff Ono, who’s also opposed to the sale. The commitments include guarantees that energy resource plans will be updated within a year of the sale going through, the company won’t be resold for at least 10 years, and customers will have smart meters by the end of 2019 along with dynamic time-of-use pricing.
There was a small protest outside the school before the hearing began, organized by three environmental groups — Sustainable UH, 350.org Hawaii and the Citizens’ Climate Lobby.
“We refuse to give control over our renewable energy to a utility 5,000 miles away that generates most of its energy through nuclear power and fracked gas,” Kristen Jamieson, president of Sustainable UH, said.
Inside the audience numbered about 200, similar to the turnouts on neighbor islands.
While the people who testified on Oahu and Maui covered a wide range of ground, Big Island residents mostly objected to the utility model itself. Many told the PUC that they want to break free of the investor-owned model and create a member-owned cooperative like Kauai did in 2002. That’s a viewpoint that only came up a couple times Tuesday.
Alternative utility ownership models are being explored on Maui, Oahu and the Big Island. Maui has hired a private firm to study other models; a nonprofit group was created on the Big Island to push for a cooperative; and 41 state and county lawmakers from multiple islands have banded together in support of a study of alternative utility options.
The PUC will now pivot from the public listening sessions to a trial-like proceeding that starts Nov. 30 at Blaisdell Arena.
Gould said the utility companies are looking forward to presenting their case.
“The evidentiary hearing is a legal proceeding. The commission will be presented facts. And that is the value of that type of proceeding,” he said. “If you strip out the politics, if you strip out the rhetoric, on its merits, we believe it’s a compelling case.”
PUC Chair Randy Iwase said after the listening session Tuesday that he was glad to have given the public a chance to comment on the proposed acquisition.
“This is something they cannot do in the context of the evidentiary hearing,” he said. “And while we have to deal with the evidence that comes in at the hearing, we don’t rule from a vacuum. We live here and we have to take into account all that we heard, for and against.”
The commission is holding a pre-hearing conference next week to go over the ground rules for the evidentiary hearing.
The hearing is expected to take weeks, or even months. But as soon as all the parties are finished making their case and cross-examining witnesses, the PUC plans to consider the testimony and make a decision on whether the merger should be approved, perhaps by June.
“At the end of the day, the fact that there has been such a widespread debate regarding energy in Hawaii is a good thing,” Gould said.