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Nathan Eagle/Civil Beat/2023

About the Author

Murray Clay

Murray Clay is president of Ulupono Initiative, a Hawaii-focused impact investing firm working to improve the quality of life for island residents in locally produced food, clean transportation choices, renewable energy and better management of our freshwater resources.


Claiming a utility company chose renewable energy over resiliency investments reveals a lack of understanding of how regulated utilities work.

As we have all become painfully aware, the devastating wildfires on Maui are the worst disaster in Hawaii in living memory. With lives, homes and businesses lost, it is proper to ask hard questions and demand accountability.

However, we need to be wary of false narratives and outright manipulation by those who seek to use our grief for their own aims.

One significant example of this is recent reporting and lawsuits that suggest the electric utility chose renewable energy over, or instead of, resiliency. Such statements are badly misinformed at the very least if not outright deceptive.

Claiming the utility chose renewable energy over resiliency investments demonstrates a fundamental lack of understanding for how our regulated utility works.

Renewable energy generally comes in two forms: 1) utility-scale projects; and 2) customer-based roof-top solar. The utility-scale projects are sought by requests for proposals where independent power producers propose projects. Hawaiian Electric (the electric utility for Maui, Lanai, Molokai, Oahu and Hawaii island) picks the lowest bidders with oversight by the Hawaii Public Utilities Commission. This uses independent capital 鈥 not utility or ratepayer capital.

HECO crews work on utility lines mauka of the Lahaina Bypass Sunday, Aug. 13, 2023, in Lahaina. A large fire consumed areas of West Maui last week. Utilities have not been fully restored.  (Kevin Fujii/Civil Beat/2023)
HECO crews work on utility lines mauka of the Lahaina Bypass. There has been a lot of misinformation about how regulated utility works in the wake of the August wildfires. (Kevin Fujii/Civil Beat/2023)

Over the last year, solar energy has been coming in at prices about half the cost of oil-based power. This saves the ratepayer money and is not a source of major utility expenditures.

Customer rooftop solar similarly is not financed by the utility but by the customers themselves. For the last decade, customers have demanded that the utility allow them to add solar more quickly to do their part in fighting climate change and to have greater control over their energy expenditures.

In short, renewable energy is not a source of major capital expenditures and, on the contrary, lowers customers鈥 rates and gives them more options while fighting climate change.

What About Resiliency?

It is true the need to make our grid more resilient has long been understood. While we are not attempting to address fault or defend Hawaiian Electric鈥檚 actions taken during the Aug. 8 Maui fires, it is important to note that years prior, the utility鈥檚 Integrated Grid Planning process formed a Resiliency Working Group to support the development of resiliency planning inputs for Hawaii鈥檚 power system.

The working group consisted of 76 participants from across all service territories of Hawaiian Electric, representing government, community, nonprofit, and advocacy groups. These meetings began in July 2019 and continued through November 2021.

This work led to Hawaiian Electric鈥檚 application for approval of a Climate Adaptation Transmission and Distribution Resilience Program, seeking $190 million to 鈥渁dapt the Companies鈥 transmission and distribution system to our state鈥檚 changing climate and growing resilience threats through the implementation of high-value, no-regrets actions.鈥

The proposal incorporated recommendations from the Resilience Working Group. This application was first submitted in June 2022 and is currently awaiting a PUC decision.

To reduce the impact on ratepayers, Hawaiian Electric applied for funding from the U.S. Department of Energy under the Infrastructure Investment and Jobs Act for its Climate Adaptation Resilience Program. Due to the energy department’s match requirements, the application sought approximately half of program costs.

On Aug. 29, the federal energy department notified the utility of its successful award for this funding. From the beginning, this $190 million was clearly explained as a 鈥渄own payment鈥 on the needed investments to harden the grid. The entirety of the work would cost at least hundreds of millions of dollars.

While this work unfortunately did not conclude in time to be of aid to the people of Maui, the work was ongoing in good faith with stakeholder participation.

Our grief for the lives lost and livelihoods destroyed in the wildfire has caused some to suggest this expensive grid hardening should have already happened. Authorization to recover the cost of such investments must come through a regulatory review and approval process at the PUC.

There never has been a choice between renewables or resiliency.

The utility could not raise hundreds of millions of dollars if it would not be able to recover the cost and repay funders. Government aid is one potential source of capital, but the bottom-line is that this work can鈥檛 be done without funding.

Hawaii has some of the highest electricity rates in the nation, so it is understandable customers have long insisted that rates be controlled or brought down. To date, one of the best ways to bring rates down has been to add low-cost renewable energy. In short, there never has been a choice between renewables or resiliency.

The idea that slowing the move to renewable energy and instead relying on expensive oil 鈥 which accelerates climate change fueled disasters 鈥 would somehow have provided hundreds of millions of dollars for grid resiliency investments has no basis in fact.

Let鈥檚 continue the push for renewables as our best option for fighting climate change and reducing bills while looking for ways to fund critical resiliency investments.

Community Voices aims to encourage broad discussion on many topics of community interest. It鈥檚 kind of a cross between Letters to the Editor and op-eds. This is your space to talk about important issues or interesting people who are making a difference in our world. Column lengths should be no more than 800 words and we need a photo of the author and a bio. We welcome video commentary and other multimedia formats. Send to news@civilbeat.org. The opinions and information expressed in Community Voices are solely those of the authors and not Civil Beat.


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About the Author

Murray Clay

Murray Clay is president of Ulupono Initiative, a Hawaii-focused impact investing firm working to improve the quality of life for island residents in locally produced food, clean transportation choices, renewable energy and better management of our freshwater resources.


Latest Comments (0)

This all sounds great, but what were CEO bonuses tied to? There are 10 of them (didn't achieve all 10 so didn't get full incentive bonus at last effort).Renewables is on the list. As was profits and worker safety.Resiliency, fire mitigation, etc was not.There are only so many things a company can prioritize or focus on. That doesn't mean they are doing zero of it, but it also means that it isn't something being closely looked at or looked at by senior management.

hawaii_living · 1 year ago

Kauai used to have elecricity rates that were higher than the rest of Hawaii. Kauai Island Utility Cooperative provides electricity to Kauai, and Hawaiian Electric provides electricity to the rest of Hawaii. Several years ago, KIUC embarked on an effort to shift quickly away from fossil fuels to renewable energy. Hawaiian Electric has been making the transition also, but much more slowly. As a result, KIUC electricity rates are now lower than those of Hawaiian Electric. As the article says, "Over the last year, solar energy has been coming in at prices about half the cost of oil-based power." That is evident when comparing Kauai with the rest of the state.

sleepingdog · 1 year ago

So good to see the correct information from Murray Clay - someone who really knows the situation. Much needed to counter all the "disinformation experts" out there.

CaptRon · 1 year ago

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