HECO president grilled on Day 1 of merger hearings

The first day of hearings in the proposed acquisition of Hawaii’s electric utilities consisted of questioning of Hawaiian Electric Co. President and CEO Alan Oshima.

Pointed questions came from Hawaii Public Utilities Commission General Counsel Thomas C. Gorak, Hawaii Consumer Advocate Jeffrey Ono, Deputy Attorney General Gregg Kinkley, representing the Department of Business, Economic Development and Tourism, and more.

Much of the early questioning focused on whether the Hawaiian Electric companies’ executives considered the impacts their customers could face as a result of the proposed $4.3 billion acquisition by Florida-based NextEra Energy Inc.

“Did anyone from (parent company Hawaiian Electric Industries) or HECO undertake an analysis of the risk for ratepayers?” Gorak asked in one exchange.

“I don’t think we perceive a risk for ratepayers,” Oshima replied.

“It’s your testimony there is no risk whatsoever to ratepayers through the approval of the merger?” Gorak shot back.

“There may be, but that’s the purpose of this (regulatory) process, to ferret out the risks,” the HECO president replied.

Other questions looked into the early days of the courtship of the Hawaiian Electric companies by NextEra, and the development of a benefits package for electric consumers, which NextEra claims would provide $60 million in customer savings.

The hearing was the first of an estimated 12 days of testimony from various witnesses during the trial-like hearings, which are required before the PUC renders its approval or denial of the merger. The PUC identified June as its deadline to render a decision.

In the days leading up to the launch of the hearings, multiple businesses, organizations and government agencies weighed in with their support or opposition to the merger.

Among those voicing their support for the acquisition are the Hawaii Island Chamber of Commerce, KTA Superstores, L&L Hawaiian Barbecue, the Hawaii State AFL-CIO, the Building Industry Association and more.

“The support we have received from these organizations, alongside our recent agreements with the Department of Defense and the Honolulu Board of Water Supply, further strengthens our belief that NextEra Energy is the right partner to help Hawaiian Electric achieve Hawaii’s 100 percent renewable portfolio standard by 2045, while integrating more rooftop solar, modernizing the electric grids and lowering customer bills,” NextEra Energy Hawaii President Eric Gleason said via a Monday press release.

Others have spoken out in opposition to the deal, not least of which being the state Consumer Advocate’s Office, which is charged with representing consumers in regulatory proceedings.

Last week, the office filed its most strongly worded testimony yet, recommending the PUC deny the plan, saying the merger “does not provide tangible and substantial net benefits to Hawaii’s consumers.”

“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,” reads the pre-hearing brief.

Meanwhile, others remain undecided. In a press release issued Sunday, the Hawaii Advocates for Consumer Rights said it had yet to take a position on the merger.

“We have had many calls from consumers wanting to know our position but as it stands, there are simply too many unknowns and too much contradictory information in circulation for us to make an informed decision,” reads the release. “We hope to have many of our lingering questions answered after the 12-day PUC evidentiary hearing, beginning on Monday, November 30, 2015.”

The hearings are slated to continue today beginning at 9:30 a.m. at the Blaisdell Center in Honolulu. Live broadcasts can be accessed at olelo.org or on Na Leo ‘O Hawaii Channel 49.

Email Colin M. Stewart at cstewart@hawaiitribune-herald.com.