HECO seeks 5.2 percent rate hike
The utility says the money is needed for new energy projects
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Hawaiian Electric Co. is making its second rate increase request in less than a year.
The utility is asking for a 5.2 percent rate increase, expected to generate $97 million, to help offset costs for its new biodiesel plant in Campbell Industrial Park.
The rate hike, subject to approval by the state Public Utilities Commission, likely would not go into effect until the middle of next year at the earliest.
A typical household using 600 kilowatt-hours a month would see its monthly bill increase by $6.77, to $183.62. The increase would incorporate tiered residential electric rates to reward customers for energy conservation, HECO said.
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Hawaiian Electric Co.
said yesterday it is requesting a 5.2 percent rate increase to help offset costs for its new biodiesel plant in Campbell Industrial Park.
HECO Rate History
Hawaiian Electric Co. is seeking approval for a 5.2 percent rate increase from the state Public Utilities Commission. If approved, it would give HECO $97 million in additional revenue. A look at HECO's past increases, in millions of dollars, 1983 to the present:
* Interim rate case awaiting PUC final ruling, adjusted in June of this year from $70 million and 4.96 percent due to a change in the rate accounting method in the 2005 case.
** Adjusted in June of this year from $41 million and 3.3 percent with the 2005 interim rate case final ruling by the PUC.
Source: Hawaiian Electric Co.
The utility expects to generate $97 million from the rate hike, which likely would not go into effect until the middle of next year at the earliest, pending state Public Utilities Commission approval, according to spokesman Darren Pai.
If the entire increase were approved, a typical household using 600 kilowatt-hours a month would see its monthly bill increase by $6.77, to $183.62. The increase would incorporate tiered residential electric rates to reward customers for energy conservation, HECO said, with those customers seeing a lesser increase of between 3 percent and 4 percent.
In October the PUC approved a 4.96 percent, or $70 million, interim rate increase, which was adjusted upward to 5.6 percent, or $77.9 million, in June when a final decision was issued for a 2005 rate case. That decision adjusted the 2005 requested rate of 3.3 percent, or $41 million, down to a final rate of 2.7 percent, or $33 million.
There is no deadline for a final rate issuance by the PUC, said Catherine Awakuni, executive director of the Division of Consumer Advocacy.
"The interim is something that can be amended by the PUC in its final decision," she said, "It is very likely the commission probably will issue an interim around the 10th or 11th month from the completed application filing date."
Two rate cases have been open simultaneously before, she said. From October through June, the 2007 rate case was in interim status while the 2005 case also was awaiting a final decision.
"There's never a good time to ask for a rate increase, but we have a responsibility to meet the current and future energy needs of our residential and business customers on Oahu," HECO spokesman Robbie Alm said in a statement. "That means adding more renewable energy resources like our new biodiesel generating unit and making the investments to maintain and upgrade the electric grid."
The 110-megawatt biodiesel plant was approved by the PUC in May 2007 and is expected to be in service by August 2009. It will be Oahu's first centralized power plant in more than 17 years, needed most during peak demand evening hours, according to HECO.
In addition to the plant, the requested increase will help cover more than $375 million in new projects to be completed by the end of next year, including new air quality monitoring stations, costs related to a new 218-kilowatt photovoltaic system at the company's Archer Lane substation and the replacement of fiber-optic cables on Leeward transmission lines.
The interim rate increase filed in October included costs for projects such as a new system operations dispatch center and substation generator unit improvements.