Maui County Looks Into Alternative Utility Ownership
In anticipation of NextEra Energy’s merger with Hawaiian Electric Industries, Maui County is looking into different options of electricity utility ownership to determine which model would provide the best support for Maui County’s transition into 100% renewable energy smart grids and microgrids. The Request for Proposals (RFP), posted by Mayor Alan Arakawa’s Office of Economic Development on May 5, provides a $30,000 budget and four-month deadline for an analysis which would need to include the following:
- Preliminary appraisals of how much it would cost to purchase the electric utility in its entirety and in certain parts
- Benefits of a public power utility and an energy cooperative form of ownership as alternative utility business models
- A recommendation of the utility structure(s) and ownership option(s) that would best align with Maui’s renewable energy future
“We must look at our options, but to do that and have a constructive conversation about the matter we need more information,” Arakawa said. “This study will provide us that information, and will tell us if it would be best to start our own utility, form a co-op as Kauai did, allow the NextEra deal to go through or some other option. We need to make an informed decision as a community.”
Arakawa and Kauai County Mayor Bernard Carvalho have discussed Kauai’s electric co-op. “We’re open to maybe partnering and sharing some of our processes of hooking up with Kauai as far as extending out to our neighbor islands too,” Carvalho said.
Kauai is the only island that is not part of Hawaiian Electric Industries and has the state’s only electric co-op, Kauai Island Utility Cooperative (KIUC). KIUC purchased Kauai Electric Company in 2002 for $215 million and currently operates over 32,000 electric accounts. As a non-profit organization that is owned and controlled by the people it serves, KIUC has over 23,000 active member-owners and returned $30 million to members as patronage capital and refunds since the co-op was established.
According to the RFP, the proposed sale of Maui Electric Company to NextEra Energy brings about concerns of whether ratepayers will benefit from the change in ownership, if consumer photovoltaic systems and other sources of distributed energy will be suppressed, and whether the proposed sale will support Maui’s desire to be the “electric utility of the future.”
Maui Electric President Sharon Suzuki responded to the RFP saying that she respects the mayor’s decision to examine alternative utility models and issued the following statement:
“As with other utility services like water and sewer services, ownership is only one aspect to consider when dealing with a critical need such as energy for homes, businesses, and public facilities such as medical care centers – lowering costs and providing energy that’s reliable is expected.
We’ve made significant progress and will continue to move forward on our transformation efforts. Currently, 33% of our energy on Maui comes from renewable sources and more than 10% of our customers have rooftop PV systems, far exceeding the national average of less than one percent.
All of our employees at Maui Electric feel a deep commitment and sense of responsibility to serve Maui County’s energy needs. This has not changed in our 90-plus year history and we remain committed to the community we live and work in.”
The deadline to submit proposals is 4 p.m. on Friday, June 5, 2015. For more information, call the Mayor’s Office of Economic Development at 270-7710.