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A key lawmaker on Thursday blocked a plan by Hawaiian Electric Co. to issue bonds that would be backed by a proposed new fee on customers’ bills to pay for HECO’s wildfire mitigation plans.

But Gov. Josh Green has intervened to try to keep the issue alive in a bit of late-session drama at the Capitol.

Senate Commerce and Consumer Protection Chair Jarrett Keohokalole announced Thursday morning he was deferring indefinitely, which normally would mean that the bill would die for this session.

But Green wrote to Keohokalole later in the day urging him to keep working on the issue over the weekend and into Monday if need be. The governor also offered to make his office available for meetings on the subject and indicated he is willing to join in the talks.

“This is a bill of enormous importance for our state,” Green wrote. “Our energy future and the stability and reliability of the utility is riding on this bill.”

HECO has said it wants authorization to issue bonds and impose a fee of up to 5% of its customers’ monthly bills to finance those bonds and raise money in a process known as securitization. Utility executives have said that fee could raise as much as $2.5 billion for wildfire mitigation work.

Green said that while he understands Keohokalole “may have some concerns about the finances of the utility and its plans on how it would use securitization if enacted, I believe those concerns can be addressed.”

Keohokalole said Thursday morning he made his decision “after careful consideration and consultation with my colleagues.”

Lawmakers received more than 1,400 pages of testimony on SB 2922 earlier this month, with hundreds of critics opposing HECO’s plans and the proposed new fee.

Members of the grassroots Lahaina Strong organization declared in their testimony that HECO should not be allowed to “burden ratepayers with the consequences of its own mismanagement and negligence.”

In announcing on Thursday that he would block the bill, Keohokalole said “it is premature to commit potentially decades of consumer payments toward the facilitation of a wildfire mitigation plan that does not yet exist.”

He said the state Public Utilities Commission already has the authority to support HECO’s wildfire mitigation efforts, and the PUC told lawmakers it plans to do so in a public process.

Keohokalole said HECO’s parent company “also currently has access to resources, both through their own internal and existing PUC processes, and also through opportunities available with the federal government” to advance the most critical fire mitigation measures.

“As we have been asked not to rush to judgment in the aftermath of the Maui wildfires, it is not prudent for the Legislature to rush to action here when there is still much to be determined with our utilities and our energy future,” he said.

Keohokalole was unavailable for further comment Thursday or to respond to Green’s plea that he reverse his decision and keep the measure alive.

Jim Kelly, HECO’s vice president for government and community relations, said “we’re very disappointed with the outcome, considering how far this legislation had come.”

But he said the utility is not giving up.

“There’s still a week to go in the legislative session. We’re engaging with legislative leaders and others, and trying to determine if there’s a path forward so we can take action now to reduce the risk of wildfire,” he said.

“Ultimately, moving forward without the right solution in place is going to result in higher costs for customers, and it’s going to be harder for us to move quickly and mitigate wildfire risk and advance important safety work,” he said.

At least 101 people died in the Aug. 8 fire, which destroyed thousands of homes and businesses. HECO now faces more than 150 lawsuits alleging it was at least partly to blame for the fire, which streaked through Lahaina on extremely high winds.

SB 2922 was introduced on behalf of HECO, and would allow the utility to issue special bonds to cover costs related to wildfire prevention and also for costs and expenses related to the 2023 wildfires if approved by the PUC.

Such bonds are frequently used by utilities as a way to issue debt with lower interest rates than what the utilities otherwise can get. That process is known as securitization, and the bonds would be paid off with a new fee of up to 5% imposed on utility customers.

The bond proceeds could be used for “any capital costs and operation and maintenance expenses related to the development, implementation, and administration of a wildfire protection plan,” according to the bill.

They also could be used for any “catastrophic wildfire costs or expenses authorized by the commission.”

The utility initially proposed that some money from the bonds be used to pay some costs from the Aug. 8 fire, but Kelly said that in recent weeks “it became clear there wasn’t much appetite for that at the Legislature, so we’ve been looking primarily at this as a tool to help us get the work done to move forward on wildfire safety.”

Although the PUC would have to approve the bond issuance through a financing order, the commission could not conduct the sort of lengthy public regulatory approval process for which it is often known. Instead, the bill says the commission would have to approve or deny HECO’s request within 90 days.

HECO executives told lawmakers on April 18 they are already sinking $117 million into wildfire prevention, including substantial investments to monitor and harden the grid and detect potential wildfire threats early. They are also aggressively pursuing federal grant funding, they said.

HECO has also been seeking approval of separate measures, and , that would allow the state to establish a wildfire relief fund to be financed with contributions from the state, private parties and HECO. The utility would be able to raise money to contribute to the fund through securitization.

Participating contributors to that fund generally could not be sued for catastrophic wildfire damage they cause in the future. Instead, money from the fund would be used to cover damages similar to the way workers’ compensation funds pay damages to injured workers as an alternative to litigation.

Both of those bills have also stalled, with no conference committee meetings scheduled on either measure.

Henry Curtis, executive director of Life of the Land, said his organization “recognizes that utility financing and wildfire protection issues are incredibly complex. We look forward to Public Utilities Commission proceedings to address fire mitigation issues.”

Curtis, who tracks utility issues closely, predicted HECO’s wildfire mitigation plan will take several months to a year to develop.

Keohokalole said at the Thursday hearing where he announced his decision that “this is not a ‘no’ for us on securitization.”

He recommended lawmakers work with the utility after session to refine and improve HECO’s mitigation plans to ensure they meet the needs of the community and consumers.

But Green worries that waiting another year to take action will cause unnecessary problems for residents and businesses.

“Inaction this session on the securitization bill and also the wildfire insurance bill will place our state in danger of seeing steep increases in our energy costs,” he said in a note to Civil Beat. “Finally none of this would have been an issue had the climate impact fee been passed when we proposed it. These matters must be addressed in an era of climate change and heightened risk for natural disasters.”

Civil Beat reporter Stewart Yerton contributed to this report.

Civil Beat’s coverage of Maui County is supported in part by a grant from the Nuestro Futuro Foundation.