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The Honolulu Advertiser
Posted on: Thursday, December 14, 2006

O'ahu, Maui electricity rates may be going up

By Greg Wiles
Advertiser Staff Writer

Homeowners and others on O'ahu and Maui could be paying higher electricity rates within the next 18 months as electric utilities signaled their intent to hike what they charge.

Hawaiian Electric Co. is expected to submit a rate increase soon as the utilities attempt to recover costs for reliability projects and higher maintenance costs, said Hawaiian Electric spokeswoman Lynne Unemori.

Maui Electric Co. also is working on a rate filing for Maui, Moloka'i and Lana'i.

Unemori said any filing increase would require a review by the state Public Utilities Commission and, if granted, would probably take effect a year or so after the filing.

"We do have plans to file something," said Unemori. "But we know that any potential rate increases are hard on customers, so the decision to file for one wasn't one that we took lightly."

The utilities notified the state Public Utilities Commission in September that they were going to file for the rate increases, though they didn't include how big of a rate adjustment they would seek. Currently, Hawaiian Electric has a 3.4 percent rate hike pending at the PUC, of which a 3.3 percent interim hike has been granted, Unemori said.

Christine Hirasa, Department of Commerce and Consumer Affairs spokeswoman, said state Consumer Advocate Catherine Awakuni expects HECO to file its rate proposal by the end of the year and Maui Electric by the end of the first quarter. She said Awakuni had only received the notice of intent to file and would need to review specifics of a rate request before making a comment.

MECO's last rate increase was an 8.2 percent hike in 1999. MECO spokeswoman Kaui Awai-Dickson said the utility also needs to recoup costs for reliability and maintenance costs as well as those for a new steam generator. The 18-megawatt generator became fully functional in September.

Hawai'i's statewide residential electricity average ranked as the highest in the nation at 24.49 cents per kilowatt hour in August, according to the last survey by the U.S. Energy Information Administration.

That was more than double the national average of 10.94 cents. Hawai'i's rates are high, in part, because of costs running isolated utility systems and use of oil to run much of the generating capacity throughout the state.

Electricity costs have come down since August as oil costs have fallen. In December, O'ahu residential customers will pay about 17.3 cents per kilowatt hour.

The average O'ahu residential customer using 600 kilowatts will have a bill of $111.05 in December, including a fixed $7 customer charge.

Those on Maui will pay 26 cents a kilowatt hour in December, also lower than previous months.

Unemori acknowledged HECO could seek another increase in coming years because of its plans to build a $140 million, 110-megawatt generating unit at Campbell Industrial Park, along with a 138-kilovolt transmission line. That project is planned to begin service in 2009.

Among other utilities in the state, Hawaiian Electric Light Co. on the Big Island has a 9.2 percent rate increase pending before the PUC, while Kaua'i Island Utility Co-op has no plans or pending rate hikes.

The Kaua'i utility's last rate change occurred in 1999 when it cut its rates by less than 1 percent, spokeswoman Anne Barnes said.

Reach Greg Wiles at gwiles@honoluluadvertiser.com.