HELCO seeks rate increase

HILO — Hawaii Electric Light Co. is seeking a 3.4 percent increase in base rates it says is needed to keep up with operation costs.

The proposal announced Friday afternoon is part of a rate review required every three years, and is subject to approval by the state Public Utilities Commission.

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Any increase is not expected to take effect until late 2019.

HELCO estimates the rate hike will generate $13.4 million in additional revenue.

It would cost a typical residential customer using 500 kilowatt-hours of electricity another $8.21 per month.

In a press release, the utility said part of the increase would be used to fund grid modernization efforts, repairs to facilities damaged by the Kilauea eruption and increasing operation at power plants due to the loss of Puna Geothermal Venture, increased vegetation management, repairing and repowering the Waiau hydro plant, enhancing cybersecurity, and equipment upgrades or repairs.

Additionally, HELCO says the funds would help pay for power grid improvements to integrate more renewable energy sources.

PGV has a capacity of 38 megawatts and remains offline. Ormat Technologies, which owns the lava-locked facility, says it plans to restart. It began building a road over the cooling lava channel this week.

The loss of the geothermal power plant required HELCO to increase production at its steam power plants, which burn oil.

The utility’s monthly rates can fluctuate based on the price of oil.

In early 2018, the utility generated 63 percent of its power from renewable sources. That’s down to about half without PGV, HELCO said.

On Thursday, HELCO President Jay Ignacio said he hadn’t done an analysis, but he doesn’t think losing PGV had a significant impact on rates since most of the power purchased from the plant is already tied to the price of oil.

For instance, the first 25 megawatts is paid at “avoided costs,” meaning HELCO pays PGV the cost difference for not needing to burn as much oil to produce power. Ignacio said there are different rate schedules for power supplied above that amount.

“The last increment (of 8 megawatts) was where we really got favorable rates not connected to the price of oil,” he said.

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Ignacio said PGV was producing at above capacity shortly before the eruption forced it to shut down.

Email Tom Callis at tcallis@hawaiitribune-herald.com.

  1. 4whatitsworth December 15, 2018 8:16 am Reply

    Why have operating cost gone up you may ask? Here is the 2017 Total Compensation for Executive Staff..
    Chairman Compensation $5,292,220
    Co President 1 $7,058,243 – Yes there were 2 in 2017
    Co President 2 $7,058,243
    CFO $3,542,589

    Then there is union labor negotiated by guess who?

    Now to be fair profits nearly doubled from 2015 to 2017 thanks to your generous agreement for the last rate increase.

    Don’t worry because 8.21 X 12 is only $98.52 per year for the middle class. You will hardly notice this (until you do).


  2. Ernest T Bass December 15, 2018 12:02 pm Reply

    No……HELCO is a Company trading on the Stock Exchange.
    They presently MAKE $1.69 per share and PAY a $1.24 DIVIDEND. ( =3.2% dividend return)
    Helco has 108 MILLION SHARES.
    THAT is a MONEY MAKING Company.

    HAWAII is TAPPED OUT.
    NO NO NO NO NO NO NO
    PUC…..Here we go…..again.
    NO NO NO
    CALL THE PUC and PROTEST ANY RATE INCREASE.
    Otherwise …… open your wallet to an already VERY profitable company.

    Hawaii
    PUC Hawaii District Office
    688 Kinoole Street, #106-A
    Hilo, Hawaii 96720
    808-974-4533 | 808-974-4534 (Fax)


  3. metalman808 December 15, 2018 10:04 pm Reply

    HELLCO. Devil horns included. And the sinister smile. And the knashing of teeth.


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