Hawaiian Electric had estimated the switch to natural gas and greater efficiencies from modernized generation could save customers from $850 million to $3.7 billion through 2045, depending on future oil prices, and cut annual oil imports for electricity generation by more than eight million barrels, or 80%, as early as 2021.
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Hawaiian Electric officials say the utility will get $60 million after taxes. Specifically, it concluded that the application had not demonstrated a benefit to ratepayers, mitigation of risks posed by NextEra’s complex corporate structure, adequate clean energy commitments, a positive effect on local governance, or a benefit to competition in local energy markets. The decision was driven by the Hawaii Public Utilities Commission’s order to dismiss the companies’ merger application.
The transaction was opposed by a broad coalition of environmental, consumer and business parties because NextEra’s business model is incompatible with Hawaii’s goal of becoming 100% renewable by 2045.
American Savings Bank, which would have become a separate company if a merger happened, remains part of Hawaiian Electric.
The companies could have challenged the state Public Utilities Commission’s decision, but announced Monday that they have terminated their merger agreement.
“From the start, we’ve been clear that we believe we can help accelerate achieving the state’s goals”, Rob Gould, a NextEra spokesman, said previously. Hawaiian Electric also is working on community-based renewable energy programs that would allow customers who can’t install rooftop solar systems to participate in renewable energy programs. One commissioner, recently appointed by Gov. David Ige, abstained. We look forward to creating a process to find the best partner in the world. Previously, he had come out against the merger with NextEra.
Citing NextEra’s “unwillingness to transition to a clean energy utility of the future”, Earthjustice, the Hawaii Solar Energy Association, the Hawaii PV Coalition, the Sierra Club of Hawaii and the Alliance for Solar Choice are jointly praising the rejection of the takeover.
In a joint statement, NextEra and Hawaiian Electric said late Friday that they received the order and are now reviewing it.
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HEI, through its subsidiaries Hawaiian Electric Co. on Oahu, Maui Electric Co., and Hawaii Electric Light Co. on the Big Island, provides power to 95 percent of Hawaii residents.
