Maui mayor floats splitting with Hawaiian Electric, creating public utility

Dive Brief:

Maui Mayor Alan Arakawa (R) is considering making the island's utility a publicly-owned power provider, fearing that profits will leave the state if Florida-based NextEra Energy is allowed to purchase the utility's parent company.
Maui Electric is the second subsidiary of Hawaiian Electric Industries (HEI), which owns the state's dominant electric provider, to be the target of public utility conversion talks. The Honolulu Star-Advertiser reports a group on Hawaii has also raised the idea of creating Hawaii Electric Light Co. a cooperative provider.
NextEra's bid to acquire Hawaiian Electric Industries (HEI) was announced in early December, but some critics fear the deal could slow the integration of cleaner power into Hawaii's mix.

Dive Insight:

NextEra's potential acquisition of HEI has thrown Hawaiian energy politics into flux, with leaders in two of Hawaiian Electric Co's (HECO) service areas now talking about taking over their own energy supply. The Star-Advertiser reports that both Maui Electric and Hawaii Electric Light are being considered for conversion into publicly-owned providers, and neither NextEra nor HECO is commenting.

Maui Mayor Alan Arakawa said at an event last week, "We have come to the conclusion that we have to start looking at this thing very seriously as to what our potential is in actually investing and creating our own utility."

Hawaii has been struggling to integrate more renewable power into its mix, and the NextEra proposal has been closely watched on that front. The company is a leading clean energy developer and says it will help bring larger amounts of rooftop solar online, but critics note NextEra also owns Florida Power & Light, a utility not known for its support of distributed generation. The mayor is also reportedly upset about NextEra's plans to use liquefied natural gas a bridge fuel to a renewables-based generation system.

Lawmakers last month filed bills in the state legislature to increase oversight of the merger, and many supported participation of the proposed non-profit Hawaii Island Energy Cooperative (HIEC) in the PUC merger proceeding. They believe a publicly owned utility, like the Kauai Island Utility Cooperative, could be a better alternative than ownership by NextEra.

Hawaiian Electric, Maui Electric and Hawaii Electric Light say they continue to lead the nation in rooftop solar, with an estimated 12% of customers owning systems. But connections were halted until recently, as the utilities said the grid had become unstable. Last month state regulators reached an agreement directing the utility to continue connecting customers with rooftop solar systems to the grid.