HAWAII — The state Public Utilities Commission upheld last week its decision to not compel testimony from company CEOs in the upcoming evidentiary hearing on the proposed merger of NextEra Energy Inc. and the Hawaiian Electric companies.
Meanwhile, the state Consumer Advocate provided its harshest criticisms yet of the proposed merger.
In an order issued Wednesday, the PUC denied an objection by the state Consumer Advocate regarding the list of witnesses anticipated to provide testimony at the hearing beginning Monday in the proposed $4.3 billion acquisition of Hawaii’s electric utility companies.
The Consumer Advocate filed its objection the day before, claiming that Hawaiian Electric CEO Constance Lau and NextEra CEO James Robo are “critical witnesses,” possessing “unique and superior knowledge” in regard to the merger and its potential impacts on Hawaii consumers.
“The proposed merger transaction is the largest utility transaction in the state’s history and has generated more interest and participation than any prior commission docket,” the Consumer Advocate wrote in its objection.
“With the interests of over 450,000 customers, numerous stakeholders and claims of offering customer benefits totaling nearly $1 billion, it is inconceivable how the commission would not require the chief executive officers of the merger principals to answer questions about the proposed merger.”
Lau stands to earn a “golden parachute” compensation package worth $10.6 million in the event the sale is approved by the PUC.
The Consumer Advocate, which is charged with representing the interests of Hawaii consumers in dockets before the PUC, has been increasingly critical of the NextEra merger as the process has continued.
On Nov. 23, the Consumer Advocate’s office filed a pre-hearing brief saying it “does not support commission approval of this merger in the form proposed by applicants, because it does not provide tangible and substantial net benefits to Hawaii’s consumers.”
NextEra has claimed it will help Hawaii to reach its renewable energy goals faster and more efficiently, while providing ratepayers with lower bills. But the advocate claims much of the company’s promises appear to be just smoke and mirrors.
“When carefully analyzed, it is obvious that the applicants failed to provide sufficient support and enforceable commitments that truly guarantee customer benefits while mitigating the many costs and risks arising from the merger. …
“While applicants’ estimated potential future cost savings are large, the amounts of rate reductions are paltry, temporary and not ‘guaranteed’ because of the many conditions that are attached to applicants’ rate plan and rate case moratorium, both of which are hostile to customers’ interests.”
In a Friday email, NextEra Vice President and Chief Communications Officer Robert L. Gould did not respond to questions about why company CEO James Robo did not want to testify in the hearing or regarding the Consumer Advocate’s criticism.
“We look forward to the PUC review process continuing,” he wrote. “Importantly, we’re extremely pleased that we’ve received significant support from a number of diverse organizations throughout the state from organized labor, such as the AFL-CIO and IBEW, to business groups including multiple chambers of commerce. They recognize the very real and tangible benefits this merger will bring to Hawaii.”
Email Colin M. Stewart at cstewart@hawaiitribune-herald.com.
