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The Honolulu Advertiser

Posted at 10:49 a.m., Friday, April 22, 2005

HEI outlook revised to negative by S&P

Advertiser Staff

Standard & Poor's Ratings Services revised its outlook on Hawaiian Electric Industries Inc. today to negative from stable, saying the company needs a rate increase to cover its growing expenses.

HEI subsidiary, Hawaiian Electric Co. applied in November for a 7.3 percent rate hike that would increase a typical residential electric bill by $6.51 per month, to $99.03. A typical customer uses about 600 kilowatt hours per month. The state Public Utilities Commission is due to rule on the request later this year.

"The outlook revision reflects a declining trend in HEI's consolidated financial condition," Standard & Poor's said.

S&P credit analyst Barbara Eiseman wrote that HEI's rising operating expenses and lack of return on investments along with a "long-term lack of rate relief" were problem areas for the company.