trending Market Intelligence /marketintelligence/en/news-insights/trending/oZZcn9A35imYHvVjKbjcAg2 content esgSubNav
In This List

Hawaiian Electric denies rumors it might combine with another company


Despite turmoil, project finance remains keen on offshore wind

Case Study

An Energy Company Assesses Datacenter Demand for Renewable Energy


Japan M&A By the Numbers: Q4 2023


See the Big Picture: Energy Transition in 2024

Hawaiian Electric denies rumors it might combine with another company

took the unusual step of denying speculation that it was still open to mergeroffers from other companies in the wake of its failed effort to merge withNextEra Energy Inc.

Therumors gained traction on July 18, when Hawaii Gov. David Ige several investorgroups had approached him and expressed interest in acquiring the state'sutilities. One rumor had it that Hawaii'sutilities were entertaining an offerfrom Berkshire Hathaway Energy.

Inits July 18 order rejectingthe NextEra-HEI combination without prejudice, the Hawaii Public UtilitiesCommission provided a 17-page guidance on issues that should be addressed inany future application by a potential acquirer.

However,HEI on July 19 departed from what it said has been a longstanding policy of notcommenting on market rumors and speculation, saying in a that "in view of thefrequent questions raised by various stakeholders since the recent terminationof the company's merger agreement with NextEra Energy, HEI is deviating fromthis policy in this instance."

"Despitestatements reported in the media about other unnamed parties rumored to beinterested in acquiring HEI, the company is not currently in discussions withany other party regarding a business combination and does not intend toinitiate any such discussions," HEI said.

HEIsaid its directors have determined that it is in the best interest of thecompany, shareholders, customers, employees and communities to remainindependent. "The company will notprovide any updates to the above statement nor otherwise comment on marketrumors or speculation," HEI concluded.

Thestatement followed a July 18 newsrelease in which HEI said it will move forward as an independentcompany.

However,proponents for public ownership of electric utility services have had otherideas. The desire among public power proponents is to make sure the islands'electric services remain under local control and to move Hawaii more quicklytoward its 100% renewable energy goal codified in a 2015 statute.

Emboldenedby Ige's June 21 signing of H.B. 2231 to allow use of state special purposerevenue bonds to finance publicly owned cooperatives, leaders of Hawaii IslandEnergy Cooperative and KauaiIsland Utility Cooperative are seeking to expand the co-op model.The Kauai co-op, which has 33,000 customers, is the only co-op with electricassets in the islands.

TheHawaii Island co-op owns no utility assets. It is a nonprofit association thatcommunity and business leaders formed with the aim to make the Hawaii Island'selectric assets community-owned. The association opposed the NextEra-HEImerger. HEI's Hawaii ElectricLight Co. Inc. serves the island and the company opposes sale ofits assets. The association said it has not submitted an offer but is simply "positioningitself as a possible option worthy of consideration."

TheCouncil of the City and County of Honolulu passed a resolution in January toinvestigate municipal or cooperative public ownership of electric services onOahu. The resolution, introduced by Council Chair Ernest Martin, passedunanimously in a vote of the council's nine members.

Also,Sierra Club Hawaii and The Alliance for Solar Choice organized a group calledKULOLO, or Keep Utilities Locally Owned, Locally Operated, which has beenadvocating public ownership of electric assets on the islands. Kulolo is alsothe name for a Hawaiian dessert made with taro, coconut and sugar.

Thegroups applauded Hawaiian Electric's decisionto withdraw its applications for PUC approval of plans to repower the Kahegenerating station and other plants with imported liquefied natural gas. Theplans were contingent upon financial support from NextEra, which HawaiianElectric said will no longer be possible without the merger. Clean energyadvocates frowned upon the proposed large investments in fossil fuel, althoughthe utilities wanted to replace current oil-fired generation with natural gas.

TheNextEra-HEI merger spurred municipal, cooperative, environmental and renewableenergy interests to advocate for public ownership of electric service. Now thatthe deal is off, it remains to be seen whether momentum toward publicacquisition of Hawaiian Electric's facilities will continue.