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Electric utility segment
 9 Months Ended
Sep. 30, 2022
Electric Utility Subsidiary [Abstract]  
Electric utility segment Electric utility segment
Unconsolidated variable interest entities.
Power purchase agreements.  As of September 30, 2022, the Utilities had four PPAs for firm capacity (including the Puna Geothermal Venture PPA that went offline in May 2018 due to lava flow on Hawaii Island, but returned to service with firm capacity of 13.0 MW in the first quarter of 2021, ramped up to 23.9 MW in the second quarter of 2021, and further increased to 25.7 MW in June 2022) and other PPAs with independent power producers (IPPs) and Schedule Q providers (i.e., customers with cogeneration and/or power production facilities who buy power from or sell power to the Utilities), none of which are currently required to be consolidated as VIEs.
Pursuant to the current accounting standards for VIEs, the Utilities are deemed to have a variable interest in Kalaeloa Partners, L.P. (Kalaeloa) and Hamakua Energy by reason of the provisions of the PPA that the Utilities have with the two IPPs. However, management has concluded that the Utilities are not the primary beneficiary of Kalaeloa and Hamakua Energy because the Utilities do not have the power to direct the activities that most significantly impact the two IPPs’ economic performance nor the obligation to absorb their expected losses, if any, that could potentially be significant to the IPPs. Thus, the Utilities have not consolidated Kalaeloa and Hamakua Energy in its condensed consolidated financial statements. However, Hamakua Energy is an indirect subsidiary of Pacific Current and is consolidated in HEI’s condensed consolidated financial statements.
For the other PPAs with IPPs, the Utilities have concluded that the consolidation of the IPPs was not required because either the Utilities do not have variable interests in the IPPs due to the absence of an obligation in the PPAs for the Utilities to absorb any variability of the IPPs, or the IPP was considered a “governmental organization,” and thus excluded from the scope of accounting standards for VIEs. The consolidation of any significant IPP could have a material effect on the unaudited condensed consolidated financial statements, including the recognition of a significant amount of assets and liabilities and, if such a consolidated IPP were operating at a loss and had insufficient equity, the potential recognition of such losses. If the Utilities determine they are required to consolidate the financial statements of such an IPP and the consolidation has a material effect, the Utilities would retrospectively apply accounting standards for VIEs to the IPP.
Commitments and contingencies.
Contingencies. The Utilities are subject in the normal course of business to pending and threatened legal proceedings. Management does not anticipate that the aggregate ultimate liability arising out of these pending or threatened legal proceedings will be material to its financial position. However, the Utilities cannot rule out the possibility that such outcomes could have a material effect on the results of operations or liquidity for a particular reporting period in the future.
Power purchase agreements.  Purchases from all IPPs were as follows:
 Three months ended September 30Nine months ended September 30
(in millions)2022202120222021
Kalaeloa$101 $56 $244 $142 
AES Hawaii21 32 82 98 
HPOWER18 20 56 51 
Hamakua Energy16 15 46 38 
Puna Geothermal Venture13 9 37 20 
Wind IPPs37 38 93 95 
Solar IPPs18 12 44 40 
Other IPPs 1
1 4 5 7 
Total IPPs$225 $186 $607 $491 
1Includes hydro power and other PPAs
Kalaeloa Partners, L.P.  Under a 1988 PPA, as amended, Hawaiian Electric is committed to purchase 208 MW of firm capacity from Kalaeloa. In October 2021, Hawaiian Electric and Kalaeloa signed the Amended and Restated Power Purchase Agreement for Firm Dispatchable Capacity and Energy (Amended and Restated PPA) to extend the PPA for an additional term of 10 years. In November 2021, Hawaiian Electric submitted an application for approval of the Amended and Restated PPA to the PUC, which is pending approval before the PUC. The price of purchases from Kalaeloa in the third quarter of 2022 have increased 80% over the third quarter of 2021, primarily due to increased fuel oil cost.
AES Hawaii, Inc. Under a PPA entered into in March 1988, as amended (through Amended and Restated Amendment No. 4) for a period of 30 years ending September 2022, Hawaiian Electric agreed to purchase 180 MW of firm capacity from AES Hawaii. The term of the PPA expired on September 1, 2022 and the AES Hawaii coal plant ceased operations.
Stage 1 Renewable PPAs. In February 2018, the Utilities issued Stage 1 Renewable request for proposal and have procured eight renewable PPAs with a total of 274.5 MW capacity. The total annual payments for the eight renewable PPAs are estimated at $64.7 million. The Utilities have received PUC approvals subsequently to recover the total projected annual payment for the eight renewable PPAs through the PPAC to the extent such costs are not included in base rates. On July 31, 2022, Mililani I Solar, the first utility-scale solar-plus-storage project reached commercial operations on Oahu. The project is for a 20-year term and generates 39 MW, including a 156 MWh battery. The Utilities have accounted for battery portion of the project as a finance lease and recorded a lease liability with a corresponding right-of-use asset of $48 million.
Hu Honua Bioenergy, LLC (Hu Honua). In May 2012, Hawaii Electric Light signed a PPA, which the PUC approved in December 2013, with Hu Honua for 21.5 MW of renewable, dispatchable firm capacity fueled by locally grown biomass from a facility on the island of Hawaii. Under the terms of the PPA, the Hu Honua plant was scheduled to be in service in 2016. However, Hu Honua encountered construction and litigation delays, which resulted in an amended and restated PPA between Hawaii Electric Light and Hu Honua dated May 9, 2017. In July 2017, the PUC approved the amended and restated PPA, which becomes effective once the PUC’s order is final and non-appealable. In August 2017, the PUC’s approval was appealed by a third party. On May 10, 2019, the Hawaii Supreme Court issued a decision remanding the matter to the PUC for further proceedings consistent with the court’s decision, which must include express consideration of greenhouse gas (GHG) emissions that would result from approving the PPA, whether the cost of energy under the PPA is reasonable in light of the potential for GHG emissions, and whether the terms of the PPA are prudent and in the public interest, in light of its potential hidden and long-term consequences. As a result, the PUC reopened the docket for further proceedings, including re-examining all of the issues in the proceedings. On July 9, 2020, the PUC issued an order denying Hawaii Electric Light’s request to waive the amended and restated PPA from the PUC’s competitive bidding requirements and therefore, dismissed the request for approval of the amended and restated PPA without prejudice to possible participation in any future competitive bidding process. On September 9, 2020, the PUC denied Hu Honua’s motion for reconsideration of the PUC’s order. Hu Honua filed its notice of appeal to the Hawaii Supreme Court of the PUC’s order denying Hu Honua’s motion for reconsideration. On May 24, 2021, the Hawaii Supreme Court vacated the PUC’s decision and remanded the matter back to the PUC for further proceedings. On June 30, 2021, the PUC issued an order reopening the docket consistent with the Hawaii Supreme Court’s order. A contested case hearing was held in March 2022. On May 23, 2022, the PUC issued a decision and order denying the amended and restated PPA, based on, among other things, findings that: (1) the project will result in significant GHG emissions, (2) Hu Honua’s proposed carbon commitment to sequester more GHG emissions than produced by the project are speculative and unsupported, (3) the amended and restated PPA is likely to result in high costs to customers through its relatively high cost of electricity and through potential displacement of other, lower cost, renewable resources, and (4) based on the foregoing, approving the amended and restated PPA is not prudent or in the public interest. On June 2, 2022, Hawaii Electric Light and Hu Honua filed their separate motions for reconsideration. On June 24, 2022, the PUC issued an order denying Hawaii Electric Light and Hu Honua’s respective motions for reconsideration. On June 29, 2022, Hu Honua filed its notice of appeal to the Hawaii Supreme Court of the PUC’s May 23, 2022 decision and order denying the amended and restated PPA, and the PUC’s June 24, 2022 order denying Hawaii Electric Light and Hu Honua’s motions for reconsideration. Opening briefs were filed with the Supreme Court on October 5, 2022. Answering briefs are due on December 5, 2022.
Molokai New Energy Partners (MNEP). In July 2018, the PUC approved Maui Electric’s PPA with MNEP to purchase solar energy from a photovoltaic (PV) plus battery storage project. The 4.88 MW PV and 3 MW Battery Energy Storage System project was to deliver no more than 2.64 MW at any time to the Molokai system. On March 25, 2020, MNEP filed a complaint in the United Stated District Court for the District of Hawaii against Maui Electric claiming breach of contract. On June 3, 2020, Maui Electric provided Notice of Default and Termination of the PPA to MNEP terminating the PPA with an effective date of July 10, 2020. Thereafter, MNEP filed an amended Complaint to include claims relating to the termination and Hawaiian Electric filed its Answer to the Amended Complaint on September 11, 2020, disputing the facts presented by MNEP and all claims within the original and amended complaint. Currently, the discovery phase is ongoing.
Fuels barging contract. On August 23, 2021, the Utilities entered into a five-year inter-island fuel transportation contract with Sause Bros., Inc., which commenced in January 2022. On September 22, 2022, the PUC issued a D&O approving the inter-island fuels transportation contract and recovery of associated costs through ECRC.
Utility projects.  Many public utility projects require PUC approval and various permits from other governmental agencies. Difficulties in obtaining, or the inability to obtain, the necessary approvals or permits or community support can result in significantly increased project costs or even cancellation of projects. In the event a project does not proceed, or if it becomes probable the PUC will disallow cost recovery for all or part of a project, or if PUC-imposed caps on project costs are expected
to be exceeded, project costs may need to be written off in amounts that could result in significant reductions in Hawaiian Electric’s consolidated net income.
Enterprise Resource Planning/Enterprise Asset Management (ERP/EAM) implementation project. The ERP/EAM Implementation Project went live in October 2018. Hawaii Electric Light and Hawaiian Electric began to incorporate their portion of the deferred project costs in rate base and started the amortization over a 12-year period in January 2020 and November 2020, respectively. The PUC required a minimum of $246 million ERP/EAM project-related benefit to be delivered to customers over the system’s 12-year service life.
In February 2019, the PUC approved a methodology for passing the future cost saving benefits of the new ERP/EAM system to customers developed by the Utilities in collaboration with the Consumer Advocate. The Utilities filed a benefits clarification document on June 10, 2019, reflecting $150 million in future net O&M expense reductions and cost avoidance, and $96 million in capital cost reductions and tax savings over the 12-year service life. To the extent the reduction in O&M expense relates to amounts reflected in electric rates, the Utilities would reduce future rates for such amounts. In October 2019, the PUC approved the Utilities and the Consumer Advocate’s Stipulated Performance Metrics and Tracking Mechanism. As of September 30, 2022, the Utilities’ regulatory liability was $10.0 million ($4.4 million for Hawaiian Electric, $2.2 million for Hawaii Electric Light and $3.4 million for Maui Electric) for the O&M expense savings that are being amortized or to be included in future rates. As part of the settlement agreement approved in the Hawaiian Electric 2020 test year rate case, the regulatory liability for Hawaiian Electric will be amortized over five years, beginning in November 2020, and the O&M benefits for Hawaiian Electric was considered flowed through to customers.
On July 7, 2021, the PUC issued an order modifying the reporting frequency of the Semi-Annual Enterprise System Benefits (SAESB) reports to an Annual Enterprise System Benefits (AESB) report on the achieved benefits savings. The most recent AESB report was filed on February 14, 2022 for the period January 1 through December 31, 2021.
West Loch PV Project. In November 2019, Hawaiian Electric placed into service a 20-MW (ac) utility-owned and operated renewable and dispatchable solar facility on property owned by the Department of the Navy. PUC orders resulted in a project cost cap of $67 million (including a cap of $4.7 million for the in-kind work performed in exchange for use of the Navy property) with capital cost recovery approved under MPIR (See “Performance-based regulation framework” section below for MPIR guidelines and cost recovery discussion). Project costs incurred as of September 30, 2022 amounted to $60.4 million and generated $14.7 million and $14.0 million in federal and state nonrefundable tax credits, respectively. For book and regulatory purposes, the tax credits are being deferred and amortized, starting in 2020, over 25 years and 10 years for federal and state credits, respectively. In June 2022, the in-kind consideration services were completed and fully accepted by the Navy as partial consideration in lieu of rent payment. Satisfaction of the full-term rent requires on-going compliance with all terms of the lease, which, among other things, includes provision of contingent power upon written notice of the Department of the Navy. Hawaiian Electric accounted for the arrangement as a lease, recording $6.4 million as right-of-use asset with no lease liability and will amortize the right-of-use asset over the remaining term of the lease ending June 30, 2054.
Waena Switchyard/Synchronous Condenser Project. In October 2020, to support efforts to increase renewable energy generation and reduce fossil fuel consumption by deactivating current generating units, Maui Electric filed a PUC application to construct a switchyard, which includes the extension of two 69 kV transmission lines and the relocation of another 69 kV transmission line; and the conversion of two generating units to synchronous condensers at Kahului Power Plant in central Maui. In November 2021, the PUC approved Maui Electric’s request to commit funds estimated at $38.8 million for the project, and to recover capital expenditures for the project under Exceptional Project Recovery Mechanism (EPRM) not to exceed $38.8 million, which shall be further reduced to reflect the total project cost exclusive of overhead costs not directly attributable to the project. The Waena Switchyard project is expected to be placed in service in the third quarter of 2023, while the conversion of the two generating units will be performed after the retirement of Kahului Power Plant Units 3 and 4.
In approving the project, the PUC recognized that the project will facilitate the ability to accommodate increased renewable energy, as contemplated under the EPRM guidelines. As of September 30, 2022, $11.2 million has been incurred for the project.
Environmental regulation.  The Utilities are subject to environmental laws and regulations that regulate the operation of existing facilities, the construction and operation of new facilities and the proper cleanup and disposal of hazardous waste and toxic substances.
Hawaiian Electric, Hawaii Electric Light and Maui Electric, like other utilities, periodically encounter petroleum or other chemical releases associated with current or previous operations. The Utilities report and take action on these releases when and as required by applicable law and regulations. The Utilities believe the costs of responding to such releases identified to date will not have a material effect, individually or in the aggregate, on Hawaiian Electric’s consolidated results of operations, financial condition or liquidity.
Former Molokai Electric Company generation site.  In 1989, Maui Electric acquired Molokai Electric Company. Molokai Electric Company had sold its former generation site (Site) in 1983, but continued to operate at the Site under a lease until 1985 and left the property in 1987. The federal Environmental Protection Agency (EPA) has since identified environmental impacts in the subsurface soil at the Site. In cooperation with the Department of Health of State of Hawaii and EPA, Maui Electric further investigated the Site and the adjacent parcel to determine the extent of impacts of polychlorinated biphenyls (PCBs), residual fuel oils and other subsurface contaminants. Maui Electric has a reserve balance of $2.6 million as of September 30, 2022, representing the probable and reasonably estimable undiscounted cost for remediation of the Site and the adjacent parcel based on presently available information; however, final costs of remediation will depend on the cleanup approach implemented.
Additionally, on November 24, 2021, the current landowners of the Site, Misaki’s, Inc., filed a lawsuit against Hawaiian Electric (as alleged successor in interest to Molokai Electric, the prior owner of the Site) in the Circuit Court of the Second Circuit of the State of Hawaii (removed to the U.S. District Court for the District of Hawaii). The complaint which was subsequently amended to include Maui Electric, alleges that Hawaiian Electric is responsible for remediation of the Site based on the Comprehensive Environmental Response, Compensation, and Liability Act of 1980 (CERCLA), and the Hawaii Environmental Response Law under Hawaii Revised Statutes Chapter 128D, as well as being liable on contractual claims related to a short leaseback period during the transition of ownership from Molokai Electric. The amended complaint was dismissed and a new complaint may be filed subject to the parties attempt to enter into settlement negotiations, but the Utilities intend to vigorously defend the action if necessary. At this time, the Utilities are unable to determine the ultimate outcome of the lawsuit or the amount of any possible loss. As of September 30, 2022, the reserve balance recorded by the Utilities to address the lawsuit was not material.
Pearl Harbor sediment study. In July 2014, the U.S. Navy notified Hawaiian Electric of the Navy’s determination that Hawaiian Electric is a Potentially Responsible Party under CERCLA responsible for the costs of investigation and cleanup of PCB contamination in sediment in the area offshore of the Waiau Power Plant as part of the Pearl Harbor Superfund Site. Hawaiian Electric was also required by the EPA to assess potential sources and extent of PCB contamination onshore at Waiau Power Plant.
As of September 30, 2022, the reserve account balance recorded by Hawaiian Electric to address the PCB contamination was $10 million. The reserve balance represents the probable and reasonably estimable undiscounted cost for the onshore and offshore investigation and remediation. The final remediation costs will depend on the actual onshore and offshore cleanup costs.
Regulatory proceedings
Decoupling. Decoupling is a regulatory model that is intended to provide the Utilities with financial stability and facilitate meeting the State of Hawaii’s goals to transition to a clean energy economy and achieve an aggressive renewable portfolio standard. Decoupling delinks the utility’s revenues from the utility’s sales, removing the disincentive to promote energy efficiency and accept more renewable energy. Decoupling continues under the PBR Framework.
Performance-based regulation framework. On December 23, 2020, the PUC issued a decision and order (PBR D&O) establishing a new PBR Framework to govern the Utilities. The PBR Framework incorporates an annual revenue adjustment (ARA) and a suite of new regulatory mechanisms in addition to previously established regulatory mechanisms. Under the PBR Framework, the decoupling mechanism (i.e., the Revenue Balancing Account (RBA)) established by the previous regulatory framework will continue. The existing cost recovery mechanisms will continue as currently implemented (i.e., the Energy Cost Recovery Clause (ECRC), Purchased Power Adjustment Clause (PPAC), Demand Side Management surcharge, Renewable Energy Infrastructure Program, Demand Response Adjustment Clause (DRAC), Pension and Other Post-Employment Benefits (OPEB) tracking mechanisms). In addition to annual revenues provided by the ARA, the Utilities may seek relief for extraordinary projects or programs through the Exceptional Project Recovery Mechanism (EPRM) (formerly known as the Major Project Interim Recovery adjustment mechanism) and earn financial rewards for exemplary performance as provided through a portfolio of Performance Incentive Mechanisms (PIMs) and Shared Savings Mechanisms (SSMs). The PBR Framework incorporates a variety of additional performance mechanisms, including Scorecards, Reported Metrics, and an expedited Pilot Process. The PBR Framework also contains a number of safeguards, including a symmetric Earnings Sharing Mechanism (ESM) which protects the Utilities and customers from excessive earnings or losses, as measured by the Utilities’ achieved rate-making ROACE and a Re-Opener mechanism, under which the PUC will open an examination, at its discretion, to determine if adjustments or modifications to specific PBR mechanisms are appropriate. The new PBR Framework became fully effective on June 1, 2021.
On June 17, 2022, the PUC issued a decision and order (June 2022 D&O) establishing additional PIMs under the PBR Framework for the Utilities. In 2021, the PUC Staff originally proposed consideration of 11 PIMs and other mechanisms to address identified areas of concern. Seven of the staff proposed PIMs were designed as penalty-only. The June 2022 D&O approved two new PIMs, a new SSM, and extended the timeframe for an existing PIM. Of the new PIMs, only one is penalty-only. Specifically, the PUC approved (1) a new (penalty-only) generation-caused interruption reliability PIM, (2) a new (penalty/reward) interconnection requirements study (IRS) PIM, (3) a new (reward-only) Collective Shared Savings Mechanism (CSSM), and (4) a modification and extension of the existing interim (reward-only) Grid Services PIM. The effective date for the changes has not yet been established. On September 27, 2022, the Utilities submitted for the PUC’s review and approval, proposed tariffs to implement the aforementioned PIMs with an evaluation period proposed for the generation-caused interruption reliability PIMs, IRS PIM, and CSSM to start on January 1, 2023, which is pending PUC approval. The evaluation period is the calendar year period over which performance is compared to PIM performance targets to determine the amount of reward or penalty.
In addition, the June 2022 D&O instructed the Utilities to prepare and submit: a detailed fossil fuel retirement report (FF Retirement Report) outlining necessary steps to safely and reliably retire certain existing fossil fuel power plants during the first multi-year rate period (MRP); and a functional integration plan (FIP) for distributed energy resources (DER) to increase transparency into the Utilities’ plans and progress for utilizing cost-effective grid services from DERs and ensure that the necessary functionalities and requisite technologies are in place to do so. The PUC also instructed the PBR Working Group to continue its ongoing collaborative efforts to consider other potential new incentive mechanisms and to address other issues raised during the proceeding. On October 27, 2022, the PUC issued a Notice of PBR Working Group Meeting, which is scheduled for November 29, 2022.
In accordance with the June 2022 D&O, the Utilities filed their FIP and FF Retirement Report with the PUC on September 30, 2022 and October 14, 2022, respectively.
Revenue adjustment mechanism. Prior to the implementation of the PBR Framework, the revenue adjustment mechanism (RAM) was a major component of the previously established regulatory framework. The RAM was based on the lesser of: a) an inflationary adjustment for certain O&M expenses and return on investment for certain rate base changes, or b) cumulative annual compounded increase in Gross Domestic Product Price Index applied to annualized target revenues (the RAM Cap). Under the PBR Framework, the ARA mechanism replaced the RAM, and became effective on June 1, 2021. RAM revenue adjustments approved by the PUC in 2020 will continue to be included in the RBA provision’s target revenue and RBA rate adjustment unless modified with PUC approval.
Annual revenue adjustment mechanism. The PBR Framework established a five-year MRP during which there will be no general rate cases. Target revenues will be adjusted according to an index-driven ARA based on (i) an inflation factor, (ii) a predetermined X-factor to encompass productivity, which is set at zero, (iii) a Z-factor to account for exceptional circumstances not in the Utilities’ control and (iv) a customer dividend consisting of a negative adjustment of 0.22% of adjusted revenue requirements compounded annually and a flow through of the “pre-PBR” savings commitment from the management audit recommendations developed in a prior docket at a rate of $6.6 million per year from 2021 to 2025. The implementation of the ARA occurred on June 1, 2021.
Earnings sharing mechanism. The PBR Framework established a symmetrical ESM for achieved rate-making ROACE outside of a 300 basis points dead band above or below the current authorized ROACE of 9.5% for each of the Utilities. There is a 50/50 sharing between customers and Utilities for the achieved rate-making ROACE falling within 150 basis points outside of the dead band in either direction, and a 90/10 sharing for any further difference. A reopening or review of the PBR terms will be triggered if the Utilities credit rating outlook indicates a potential credit downgrade below investment grade status, or if its achieved rate-making ROACE enters the outer most tier of the ESM.
Exceptional project recovery mechanism. Prior to the implementation of the PBR Framework, the PUC established the Major Project Interim Recovery (MPIR) adjustment mechanism and MPIR Guidelines. The MPIR mechanism provides the opportunity to recover revenues for net costs of approved eligible projects placed in service between general rate cases. In establishing the PBR Framework, the MPIR Guidelines were terminated and replaced with the EPRM Guidelines. Although the MPIR Guidelines were terminated and replaced by the EPRM Guidelines, the MPIR mechanism will continue within the PBR Framework to provide recovery of project costs previously approved for recovery under the MPIR. The newly established EPRM Guidelines permit the Utilities to include the full amount of approved costs in the EPRM for recovery in the first year the project goes into service, pro-rated for the portion of the year the project is in service. Deferred and O&M expense projects are also eligible for EPRM recovery under the EPRM Guidelines. EPRM recoverable costs will be limited to the lesser of actual incurred project costs or PUC‑approved amounts, net of savings.
As of September 30, 2022, the Utilities submitted 2022 MPIR and EPRM amounts totaling $26.2 million, including revenue taxes, for the Schofield Generating Station ($16.5 million), West Loch PV Project ($3.5 million), Grid Modernization Strategy (GMS) Phase 1 project ($6.1 million for all three utilities) and Waiawa UFLS project ($0.1 million) for the accrual of revenues effective January 1, 2022, that included the 2022 return on project amount (based on approved amounts) in rate base, depreciation and incremental O&M expenses. The PUC approved the Utilities’ recovery of the annualized 2022 MPIR amounts for the Schofield Generating Station and GMS Phase 1 projects effective June 1, 2022 through the RBA rate adjustment. Recovery of the incremental change to the West Loch PV project and Waiawa UFLS project are subject to PUC approval.
As of September 30, 2022, the PUC approved two EPRM applications for projects totaling $41 million to the extent that the project costs are not included in rates. Currently, the Utilities have outstanding applications seeking EPRM recovery for five projects with total project costs of $450 million, subject to PUC approval.
Pilot process. The PBR D&O approved a Pilot Process to foster innovation by establishing an expedited implementation process for pilots that test new technologies, programs, business models, and other arrangements. The Pilot Process is intended to support initiatives by the Utilities to test new programs and ideas quickly and elevate any successful pilots for consideration of full-scale implementation. The proposed pilots are subject to PUC approval with a total annual cap of $10 million. The Pilot Process includes an initial workplan development phase, during which the Utilities identify and scope areas of interests, so as to inform the subsequent implementation phase, during which the Utilities submit specific pilot proposals (Pilot Notices) for expedited review by the PUC. The PUC will strive to issue an order addressing a proposed pilot within 45 days of the filing date of a Pilot Notice. If the PUC does not take affirmative action on a Pilot Notice by the end of the 45-day period, the Pilot Notice shall be considered approved as submitted. The PUC may, where necessary, suspend the Pilot Notice for further investigation within the 45-day period.
On July 9, 2021, the PUC issued an order approving the Utilities’ proposed Pilot Process submitted in April 2021 with modifications, including a cost recovery process that generally allows the Utilities to defer and recover total annual expenditures of approved pilot projects in full over twelve months beginning June 1 of the year following implementation through the RBA rate adjustment, although the Utilities may determine on a case-by-case basis that a particular project’s deferred costs should be amortized over a period greater than twelve months. On July 28, 2021, the Utilities submitted the finalized Pilot Process to govern the review of the pilot project proposals, as directed by the July 9, 2021 order.
On February 28, 2022, the Utilities filed their first annual Pilot Update report covering pilot projects that were approved and initiated prior to the commencement of the expedited notification and review process. The Pilot Update reported on approximately $0.1 million of 2021 deferred costs which was incorporated in the Utilities’ adjustments to target revenue in the 2022 spring revenue report. The PUC approved the Utilities’ recovery of the 2021 Pilot amounts effective June 1, 2022 through the RBA rate adjustment.
On October 19, 2022, the PUC approved the Utilities’ proposed Workplan as supplemented on September 23, 2022, completing the initial workplan development phase. On October 20, 2022, the PUC opened a new docket to receive and address Notices submitted pursuant to the Pilot Process, commencing the implementation phase.
On October 26, 2022, the Utilities filed for the PUC’s approval to commence a Clearinghouse Pilot project in January 2023, which is to establish a cloud-based data analytics clearinghouse repository. This is the first notice filed in the Pilot Process implementation phase.
Performance incentive mechanisms. The PUC has established the following PIMs and SSMs: (1) Service Quality performance incentives, (2) Phase 1 Request for proposal (RFP) PIM for procurement of low-cost renewable energy, (3) Phase 2 RFP PIMs for generation and generation plus storage project, and Grid Services and standalone storage, (4) new PIMs established in the PBR D&O and (5) new PIMs and a SSM established in the June 2022 D&O.
•Service Quality performance incentives (ongoing). Service Quality performance incentives are measured on a calendar-year basis. The PIM tariff requires the performance targets, deadbands and the amount of maximum financial incentives used to determine the PIM financial incentive levels for each of the PIMs to remain constant in interim periods, unless otherwise amended by order of the PUC.
•Service Reliability Performance measured by Transmission and Distribution-caused System Average Interruption Duration and Frequency Indexes (penalties only). Target performance is based on each utility’s historical 10-year average performance with a deadband of one standard deviation. The maximum penalty for each performance index is 20 basis points applied to the common equity share of each respective utility’s approved rate base (or maximum penalties of approximately $6.8 million - for both indices in total for the three utilities). For the 2021 evaluation period, the Utilities incurred $0.2 million in penalties.
•Call Center Performance measured by the percentage of calls answered within 30 seconds. Target performance is based on the annual average performance for each utility for the most recent 8 quarters with a deadband of 3% above and below the target. The maximum penalty or reward is 8 basis points applied to the common equity share of each respective utility’s approved rate base (or maximum penalties or rewards of approximately $1.4 million - in total for the three utilities).
•Phase 1 RFP PIM. Procurement of low-cost variable renewable resources through the RFP process in 2018 is measured by comparison of the procurement price to target prices. Half of the incentive was earned upon PUC approval of the PPAs. Based on the seven PPAs approved in 2019, the Utilities recognized $1.7 million in 2019 with the remaining award to be recognized in the year following the in-service date of the projects, which is estimated to occur from 2023 to 2024.
•Phase 2 RFP PIMs. The PUC order issued on October 9, 2019 establishes pricing thresholds, timelines to complete contracting, and other performance criteria for the performance incentive eligibility. The PIMs provide incentives only without penalties. On July 9, 2020, the Utilities filed two Grid Services Purchase Agreements (GSPA) for the Grid Service RFP that potentially qualify for a demand response PIM; however, details of the incentive metrics will be determined by the PUC. On September 15, 2020, the Utilities filed one PPA that qualified for a PIM incentive and on February 16, 2021, the Utilities filed one additional PPA that qualified for a declining PIM incentive. The PUC approved two PPAs in September 2021 and November 2021 and two GSPAs on December 31, 2020. For the 2021 evaluation period, the Utilities earned $0.1 million in rewards related to the two PPAs.
•The PUC previously established the following two PIMs in its PBR D&O, which were approved in an order issued on March 23, 2021 and became effective on June 1, 2021. In its June 2022 D&O, the PUC modified and extended the Grid Services PIM.
•Renewable portfolio standard (RPS)-A PIM that provides a financial reward for accelerating the achievement of RPS goals. The Utilities may earn a reward for the amount of system generation above the interpolated statutory RPS goal at $20/MWh in 2021 and 2022, $15/MWh in 2023, and $10/MWh for the remainder of the MRP. Penalties are already prescribed in the RPS as $20/MWh for failing to meet RPS targets in 2030, 2040 and 2045. The evaluation period commenced on January 1, 2021. For the 2021 evaluation period, the Utilities earned $1.0 million in rewards.
•Grid Services PIM that provides financial rewards on a $/kW basis for the acquisition of eligible grid services. The eligibility period for this PIM initially commenced on January 1, 2021 and was scheduled to end on December 31, 2022. However, the June 2022 D&O extended the eligibility period for this PIM through December 31, 2023. The June 2022 D&O also increased the incentive rate for the acquisition of load reduction grid services. During the PIM performance period, newly acquired committed capacity in the Oahu Scheduled Dispatch Program (SDP), the Oahu Fast DR program (up to the 7 MW cap), and the Maui SDP program shall qualify for the incentive. The Utilities can earn a maximum reward of $1.5 million from 2021 through 2023. The effective date of the revised Grid Services PIM tariff is pending.
•The PUC also previously established the following three PIMs in its PBR D&O, which were approved by the PUC on May 17, 2021 and became effective on June 1, 2021.
•Interconnection Approval PIM that provides financial rewards and penalties for interconnection times for DER systems <100 kW in size. The Utilities can earn a total annual maximum reward of $3.0 million or a total annual maximum penalty of $0.9 million. For the 2021 evaluation period, the Utilities earned $2.8 million in rewards.
•Low-to-Moderate Income (LMI) Energy Efficiency PIM that provides financial rewards for collaboration between the Utilities and the third-party Public Benefits Fee Administrator to deliver energy savings for low- and moderate-income customers. The Utilities can earn a total annual maximum reward of $2.0 million. The PIM will initially have a duration of three years and be subject to an annual review. The evaluation period is based on Hawaii Energy’s program year with the initial evaluation year being the period of July 1, 2021 through June 30, 2022. The Utilities accrued $0.3 million in estimated rewards for the program period ending June 30, 2022.
•Advanced Metering Infrastructure Utilization PIM that provides financial rewards for leveraging grid modernization investments and engaging customers beyond what is already planned in the Phase 1 Grid Modernization program. The Utilities can earn a total annual maximum reward of $2.0 million. The PIM will initially have a duration of three years after which it will be re-evaluated. The evaluation period commenced on January 1, 2021.
•The PUC established the following new PIMs and SSM in its June 2022 D&O. The proposed tariffs and the effective date for these PIMs and SSM are pending the PUC’s review and approval.
•Generation-caused System Average Interruption Duration and Frequency Indexes PIMs to incentivize achievement of generation-based reliability targets, measured by Generation System Average Interruption Duration and Frequency Indexes (penalties only). Target performance is based on each utility’s historical 10-year average performance with a deadband of one standard deviation. The maximum penalty for each performance index is 3 basis points applied to the common equity share of each respective utility’s approved rate base (or maximum penalties of approximately $1 million - for both indices in total for the three utilities).
•An IRS PIM to incentivize the timely completion of the IRS process for large-scale renewable energy projects (rewards and penalties) measured by the number of months between final model checkout and delivery of IRS results to the developer. Target performance is ten months with an asymmetrical deadband of two-months for penalties and no deadband for rewards. The maximum penalty and reward will depend on the specifics of the upcoming procurement.
•A CSSM to incentivize cost control over the Utilities’ fuel, purchased power, and EPRM/MPIR costs (collectively, non-ARA costs). This is a reward only incentive where the Utilities retain a portion of savings when non-ARA costs in a performance year are lower than target year non-ARA costs, which are adjusted for changes in fuel prices, inflation, and system generation from a base year (calendar year 2021). The CSSM does not have a maximum reward, however, rewards are tiered, with the Utilities retaining a 20% share of the first $5 million in savings at Hawaiian Electric and of the first $1 million in savings at both Hawaii Electric Light and Maui Electric, with the Utilities’ share at 5% of any savings beyond the initial amounts of CSSM savings for each utility.
For the 2021 evaluation period, the Utilities accrued $3.7 million ($2.8 million for Hawaiian Electric, $0.4 million for Hawaii Electric Light and $0.5 million for Maui Electric) in rewards net of penalties. The net rewards related to 2021 were reflected in the 2021 fall revenue report and 2022 spring revenue report filings.
Annual review cycle. PBR D&O established an annual review cycle for revenue adjustments under the PBR Framework, including the biannual submission of the revenue reports. The Utilities fall revenue report was filed on October 31, 2022, which is subject to PUC approval. The filing reflected ARA revenues for 2023 to be collected from January 1 through December 31, 2023, as follows:
(in millions)Hawaiian ElectricHawaii Electric LightMaui ElectricTotal
2023 ARA revenues$27.0 $6.6 $6.5 $40.1 
Management Audit savings commitment(4.6)(1.0)(1.0)(6.6)
Net 2023 ARA revenues$22.4 $5.6 $5.5 $33.5 

The proposed net incremental amounts between the 2022 spring and fall revenue reports are as follows. The amounts are to be collected (refunded) from January 1 through December 31, 2023 under the RBA rate tariffs, which was proposed in the 2022 fall revenue report filing and is subject to PUC approval.
(in millions)Hawaiian ElectricHawaii Electric LightMaui ElectricTotal
Incremental RAM revenues and ARA revenues$27.0 $6.6 $6.5 $40.1 
Annual change in accrued RBA balance through September 30, 2022 (and associated revenue taxes)$(3.6)$(6.7)$(3.2)$(13.5)
Incremental Performance Incentive Mechanisms (net)
0.3 0.1 — 0.4 
Incremental MPIR/EPRM Revenue Adjustment0.3 — — 0.3
Net incremental amount to be collected under the RBA rate tariffs$24.0 $— $3.3 $27.3 

Regulatory assets for COVID-19 related costs. On May 4, 2020, the PUC issued an order, authorizing all utilities, including the Utilities, to establish regulatory assets to record costs resulting from the suspension of disconnections of service during the pendency of the Governor’s Emergency Proclamation and until otherwise ordered by the PUC. In future proceedings, the PUC will consider the reasonableness of the costs, the appropriate period of recovery, any amount of carrying costs thereon, and any savings directly attributable to suspension of disconnects, and other related matters. As part of the order, the PUC prohibits the Utilities from charging late payment fees on past due payments. As the moratorium on customer disconnections ended on May 31, 2021, the Utilities have resumed charging late payment fees in July 2021. Pursuant to PUC
orders, the deferral of COVID-19 related costs by the Utilities ended on December 31, 2020. On October 1, 2021, the PUC approved the Utilities’ request to extend the deferral period to December 31, 2021. In December 2021, to keep customers connected and provide some relief to customers experiencing financial difficulty during the pandemic, the Utilities committed to issuing $2 million in bill credits to qualified customers. The Utilities will not seek recovery for the issued bill credits, resulting in a reduction to the cumulative deferred costs. On June 9, 2022, the Utilities filed an application with the PUC, requesting recovery of a portion of the COVID-19 related deferral costs, net of cost savings realized, not to exceed the amount of $27.8 million over three years, from June 2023 through May 2026. Annual requests will be limited to actual costs incurred.
Army privatization. On October 30, 2020, the PUC approved Hawaiian Electric’s 50-year contract with the U.S. Army to own, operate and maintain the electric distribution system serving the U.S. Army’s 12 installations on Oahu, including Schofield Barracks, Wheeler Army Airfield, Tripler Army Medical Center, Fort Shafter, and Army housing areas. On March 1, 2022, Hawaiian Electric acquired the Army’s existing distribution system for a purchase price of $14.5 million, and will pay the Army in the form of a monthly credit against the monthly utility services charge over the 50-year term of the contract. The acquisition of additional assets contemplated in the contract, with an estimated value of $4 million, is planned for 2023.
Hawaiian Electric took ownership and all responsibilities for operation and maintenance of the system on March 1, 2022 for a 50-year term after a one-year transition period. Under the contract, Hawaiian Electric will make initial capital upgrades over the first six years of the contract and replace aging infrastructure over the 50-year term. In addition to its regular monthly electricity bill, the Army will pay Hawaiian Electric a monthly utility services charge to cover operations and maintenance expenses and provide recovery for capital upgrades, capital replacements, and the existing distribution system based on a rate of return determined by the PUC for regulated utility investments, as well as depreciation expense. The PUC requires Hawaiian Electric to file regular periodic reports on the activities and investments in fulfillment of the contract and will review the major projects planned on behalf of the Army. The annual impact on Hawaiian Electric’s earnings is not expected to be material and will depend on a number of factors, including the amount and timing of capital upgrades and capital replacement.
Condensed consolidating financial information. Condensed consolidating financial information for Hawaiian Electric and its subsidiaries are presented for the three and nine month periods ended September 30, 2022 and 2021, and as of September 30, 2022 and December 31, 2021.
Hawaiian Electric unconditionally guarantees Hawaii Electric Light’s and Maui Electric’s obligations (a) to the State of Hawaii for the repayment of principal and interest on Special Purpose Revenue Bonds issued for the benefit of Hawaii Electric Light and Maui Electric, and (b) under their respective private placement note agreements and the Hawaii Electric Light notes and Maui Electric notes issued thereunder. Hawaiian Electric is also obligated, after the satisfaction of its obligations on its own preferred stock, to make dividend, redemption and liquidation payments on Hawaii Electric Light’s and Maui Electric’s preferred stock if the respective subsidiary is unable to make such payments.
Hawaiian Electric Company, Inc. and Subsidiaries
Condensed Consolidating Statement of Income
Three months ended September 30, 2022

(in thousands)Hawaiian ElectricHawaii Electric LightMaui Electric
Other subsidiaries
Consolidating adjustments
Hawaiian Electric
Consolidated
Revenues$693,281 130,858 131,910 — (78)$955,971 
Expenses
Fuel oil280,447 40,540 62,615 — — 383,602 
Purchased power171,470 37,263 16,476 — — 225,209 
Other operation and maintenance77,115 21,882 22,113 — — 121,110 
Depreciation39,474 10,350 8,887 — — 58,711 
Taxes, other than income taxes64,051 12,026 12,213 — — 88,290 
   Total expenses632,557 122,061 122,304 — — 876,922 
Operating income60,724 8,797 9,606 — (78)79,049 
Allowance for equity funds used during construction2,063 206 283 — — 2,552 
Equity in earnings of subsidiaries10,577 — — — (10,577)— 
Retirement defined benefits credit (expense)—other than service costs760 166 (31)— — 895 
Interest expense and other charges, net(14,221)(2,716)(2,750)— 78 (19,609)
Allowance for borrowed funds used during construction674 63 88 — — 825 
Income before income taxes60,577 6,516 7,196 — (10,577)63,712 
Income taxes10,543 1,424 1,483 — — 13,450 
Net income50,034 5,092 5,713 — (10,577)50,262 
Preferred stock dividends of subsidiaries— 133 95 — — 228 
Net income attributable to Hawaiian Electric
50,034 4,959 5,618 — (10,577)50,034 
Preferred stock dividends of Hawaiian Electric270 — — — — 270 
Net income for common stock$49,764 4,959 5,618 — (10,577)$49,764 

Hawaiian Electric Company, Inc. and Subsidiaries
Condensed Consolidating Statement of Comprehensive Income
Three months ended September 30, 2022
(in thousands)Hawaiian ElectricHawaii Electric LightMaui ElectricOther
subsidiaries		Consolidating
adjustments		Hawaiian Electric
Consolidated
Net income for common stock$49,764 4,959 5,618 — (10,577)$49,764 
Other comprehensive income, net of taxes:      
Retirement benefit plans:      
Adjustment for amortization of prior service credit and net losses recognized during the period in net periodic benefit cost, net of taxes 5,411 768 732 — (1,500)5,411 
Reclassification adjustment for impact of D&Os of the PUC included in regulatory assets, net of taxes(5,303)(766)(733)— 1,499 (5,303)
Other comprehensive income, net of taxes108 2 (1)— (1)108 
Comprehensive income attributable to common shareholder
$49,872 4,961 5,617 — (10,578)$49,872 
Hawaiian Electric Company, Inc. and Subsidiaries
Condensed Consolidating Statement of Income
Three months ended September 30, 2021
(in thousands)Hawaiian ElectricHawaii Electric LightMaui Electric
Other subsidiaries
Consolidating adjustments
Hawaiian Electric
Consolidated
Revenues$478,046 100,313 101,141 — (1)$679,499 
Expenses
Fuel oil126,909 21,104 32,669 — — 180,682 
Purchased power136,688 31,159 17,912 — — 185,759 
Other operation and maintenance75,191 19,964 21,313 — — 116,468 
Depreciation38,912 10,050 8,424 — — 57,386 
Taxes, other than income taxes45,239 9,333 9,440 — — 64,012 
   Total expenses422,939 91,610 89,758 — — 604,307 
Operating income55,107 8,703 11,383 — (1)75,192 
Allowance for equity funds used during construction1,999 131 297 — — 2,427 
Equity in earnings of subsidiaries12,028 — — — (12,028)— 
Retirement defined benefits credit (expense)—other than service costs741 166 (30)— — 877 
Interest expense and other charges, net(12,943)(2,590)(2,616)— 1 (18,148)
Allowance for borrowed funds used during construction676 44 107 — — 827 
Income before income taxes57,608 6,454 9,141 — (12,028)61,175 
Income taxes6,996 1,433 1,906 — — 10,335 
Net income50,612 5,021 7,235 — (12,028)50,840 
Preferred stock dividends of subsidiaries— 133 95 — — 228 
Net income attributable to Hawaiian Electric
50,612 4,888 7,140 — (12,028)50,612 
Preferred stock dividends of Hawaiian Electric270 — — — — 270 
Net income for common stock$50,342 4,888 7,140 — (12,028)$50,342 


Hawaiian Electric Company, Inc. and Subsidiaries
Condensed Consolidating Statement of Comprehensive Income
Three months ended September 30, 2021
(in thousands)Hawaiian ElectricHawaii Electric LightMaui ElectricOther
subsidiaries		Consolidating
adjustments		Hawaiian Electric
Consolidated
Net income for common stock$50,342 4,888 7,140 — (12,028)$50,342 
Other comprehensive income, net of taxes:      
Retirement benefit plans:      
Adjustment for amortization of prior service credit and net losses recognized during the period in net periodic benefit cost, net of taxes2,905 393 393 — (786)2,905 
Reclassification adjustment for impact of D&Os of the PUC included in regulatory assets, net of taxes(2,799)(391)(393)— 784 (2,799)
Other comprehensive income, net of taxes106 2 — — (2)106 
Comprehensive income attributable to common shareholder
$50,448 4,890 7,140 — (12,030)$50,448 
Hawaiian Electric Company, Inc. and Subsidiaries
Condensed Consolidating Statement of Income
Nine months ended September 30, 2022
(in thousands)Hawaiian ElectricHawaii Electric LightMaui ElectricOther subsidiariesConsolidating adjustmentsHawaiian Electric
Consolidated
Revenues$1,769,995 363,888 349,866 — (113)$2,483,636 
Expenses
Fuel oil619,169 98,856 156,518 — — 874,543 
Purchased power460,855 106,710 39,262 — — 606,827 
Other operation and maintenance243,478 63,427 64,354 — — 371,259 
Depreciation118,459 31,053 26,409 — — 175,921 
Taxes, other than income taxes165,350 33,436 32,502 — — 231,288 
   Total expenses1,607,311 333,482 319,045 — — 2,259,838 
Operating income162,684 30,406 30,821 — (113)223,798 
Allowance for equity funds used during construction5,999 616 816 — — 7,431 
Equity in earnings of subsidiaries36,475 — — — (36,475)— 
Retirement defined benefits credit (expense)—other than service costs2,471 500 (95)— — 2,876 
Interest expense and other charges, net(40,833)(7,967)(8,048)— 113 (56,735)
Allowance for borrowed funds used during construction1,962 190 249 — — 2,401 
Income before income taxes168,758 23,745 23,743 — (36,475)179,771 
Income taxes27,640 5,351 4,976 — — 37,967 
Net income141,118 18,394 18,767 — (36,475)141,804 
Preferred stock dividends of subsidiaries— 400 286 — — 686 
Net income attributable to Hawaiian Electric141,118 17,994 18,481 — (36,475)141,118 
Preferred stock dividends of Hawaiian Electric810 — — — — 810 
Net income for common stock$140,308 17,994 18,481 — (36,475)$140,308 


Hawaiian Electric Company, Inc. and Subsidiaries
Condensed Consolidating Statement of Comprehensive Income
Nine months ended September 30, 2022
(in thousands)Hawaiian ElectricHawaii Electric LightMaui ElectricOther subsidiariesConsolidating adjustmentsHawaiian Electric Consolidated
Net income for common stock$140,308 17,994 18,481 — (36,475)$140,308 
Other comprehensive income, net of taxes:
Retirement benefit plans:
Adjustment for amortization of prior service credit and net losses recognized during the period in net periodic benefit cost, net of taxes9,782 1,366 1,938 (3,304)9,782 
Reclassification adjustment for impact of D&Os of the PUC included in regulatory assets, net of taxes(9,572)(1,362)(1,938)3,300 (9,572)
Other comprehensive income, net of taxes210 4 — — (4)210 
Comprehensive income attributable to common shareholder$140,518 17,998 18,481 — (36,479)$140,518 
Hawaiian Electric Company, Inc. and Subsidiaries
Condensed Consolidating Statement of Income
Nine months ended September 30, 2021

(in thousands)Hawaiian ElectricHawaii Electric LightMaui ElectricOther subsidiariesConsolidating adjustmentsHawaiian Electric
Consolidated
Revenues$1,301,297 276,974 267,992 — (21)$1,846,242 
Expenses
Fuel oil306,982 57,175 83,088 — — 447,245 
Purchased power370,240 76,992 43,288 — — 490,520 
Other operation and maintenance230,429 57,350 61,401 — — 349,180 
Depreciation116,733 30,151 25,238 — — 172,122 
Taxes, other than income taxes124,167 25,865 25,153 — — 175,185 
   Total expenses1,148,551 247,533 238,168 — — 1,634,252 
Operating income152,746 29,441 29,824 — (21)211,990 
Allowance for equity funds used during construction5,677 403 915 — — 6,995 
Equity in earnings of subsidiaries35,282 — — — (35,282)— 
Retirement defined benefits credit (expense)—other than service costs2,511 503 (96)— — 2,918 
Interest expense and other charges, net(38,604)(7,744)(7,799)— 21 (54,126)
Allowance for borrowed funds used during construction1,921 136 329 — — 2,386 
Income before income taxes159,533 22,739 23,173 — (35,282)170,163 
Income taxes23,122 5,152 4,792 — — 33,066 
Net income136,411 17,587 18,381 — (35,282)137,097 
Preferred stock dividends of subsidiaries— 400 286 — — 686 
Net income attributable to Hawaiian Electric136,411 17,187 18,095 — (35,282)136,411 
Preferred stock dividends of Hawaiian Electric810 — — — — 810 
Net income for common stock$135,601 17,187 18,095 — (35,282)$135,601 


Hawaiian Electric Company, Inc. and Subsidiaries
Condensed Consolidating Statement of Comprehensive Income
Nine months ended September 30, 2021
(in thousands)Hawaiian ElectricHawaii Electric LightMaui ElectricOther subsidiariesConsolidating adjustmentsHawaiian Electric Consolidated
Net income for common stock$135,601 17,187 18,095 — (35,282)$135,601 
Other comprehensive income, net of taxes:
Retirement benefit plans:
Adjustment for amortization of prior service credit and net losses recognized during the period in net periodic benefit cost, net of taxes14,596 2,062 1,915 — (3,977)14,596 
Reclassification adjustment for impact of D&Os of the PUC included in regulatory assets, net of taxes(14,421)(2,059)(1,915)— 3,974 (14,421)
Other comprehensive income, net of taxes175 3 — — (3)175 
Comprehensive income attributable to common shareholder$135,776 17,190 18,095 — (35,285)$135,776 
Hawaiian Electric Company, Inc. and Subsidiaries
Condensed Consolidating Balance Sheet
September 30, 2022
(in thousands)Hawaiian ElectricHawaii Electric LightMaui ElectricOther
subsi-
diaries		Consoli-
dating
adjustments		Hawaiian Electric
Consolidated
Assets      
Property, plant and equipment
Utility property, plant and equipment      
Land$42,860 5,606 3,594 — — $52,060 
Plant and equipment5,218,701 1,403,784 1,268,441 — — 7,890,926 
Right-of-use assets - finance lease48,371 — — — — 48,371 
Less accumulated depreciation(1,845,767)(640,257)(581,618)— — (3,067,642)
Construction in progress197,033 25,671 34,878 — — 257,582 
Utility property, plant and equipment, net3,661,198 794,804 725,295 — — 5,181,297 
Nonutility property, plant and equipment, less accumulated depreciation
5,300 114 1,532 — — 6,946 
Total property, plant and equipment, net3,666,498 794,918 726,827 — — 5,188,243 
Investment in wholly owned subsidiaries, at equity689,016 — — — (689,016)— 
Current assets      
Cash and cash equivalents13,295 5,154 2,778 77 — 21,304 
Advances to affiliates— 1,500 16,000 — (17,500)— 
Customer accounts receivable, net181,813 40,566 36,593 — — 258,972 
Accrued unbilled revenues, net167,037 26,508 26,875 — — 220,420 
Other accounts receivable, net26,795 4,615 4,691 — (20,609)15,492 
Fuel oil stock, at average cost184,981 20,817 23,927 — — 229,725 
Materials and supplies, at average cost45,405 10,621 21,553 — — 77,579 
Prepayments and other33,628 6,731 6,611 — (1,172)45,798 
Regulatory assets50,074 2,397 3,435 — — 55,906 
Total current assets703,028 118,909 142,463 77 (39,281)925,196 
Other long-term assets      
Operating lease right-of-use assets44,802 35,953 12,954 — — 93,709 
Regulatory assets298,759 73,845 68,678 — — 441,282 
Other119,348 18,831 20,233 — (296)158,116 
Total other long-term assets462,909 128,629 101,865 — (296)693,107 
Total assets$5,521,451 1,042,456 971,155 77 (728,593)$6,806,546 
Capitalization and liabilities      
Capitalization      
Common stock equity$2,307,992 338,598 350,341 77 (689,016)$2,307,992 
Cumulative preferred stock—not subject to mandatory redemption
22,293 7,000 5,000 — — 34,293 
Long-term debt, net1,176,814 244,417 263,468 — — 1,684,699 
Total capitalization3,507,099 590,015 618,809 77 (689,016)4,026,984 
Current liabilities      
Current portion of operating lease liabilities9,371 6,611 2,590 — — 18,572 
Current portion of long-term debt39,996 11,999 — — — 51,995 
Short-term borrowings from non-affiliates97,450 — — — — 97,450 
Short-term borrowings from affiliate17,500 — — — (17,500)— 
Accounts payable117,259 26,043 22,159 — — 165,461 
Interest and preferred dividends payable20,800 3,822 4,583 — (41)29,164 
Taxes accrued, including revenue taxes181,935 39,023 36,557 — (1,172)256,343 
Regulatory liabilities15,349 6,451 7,518 — — 29,318 
Other62,303 18,022 20,188 — (20,725)79,788 
Total current liabilities561,963 111,971 93,595 — (39,438)728,091 
Deferred credits and other liabilities      
Operating lease liabilities43,275 29,517 10,519 — — 83,311 
Finance lease liabilities46,468 — — — — 46,468 
Deferred income taxes278,230 50,774 63,172 — — 392,176 
Regulatory liabilities725,346 183,073 92,639 — — 1,001,058 
Unamortized tax credits71,916 13,354 12,731 — — 98,001 
Defined benefit pension and other postretirement benefit plans liability
211,560 46,584 50,128 — (139)308,133 
Other75,594 17,168 29,562 — 122,324 
Total deferred credits and other liabilities1,452,389 340,470 258,751 — (139)2,051,471 
Total capitalization and liabilities$5,521,451 1,042,456 971,155 77 (728,593)$6,806,546 
Hawaiian Electric Company, Inc. and Subsidiaries
Condensed Consolidating Balance Sheet
December 31, 2021
(in thousands)Hawaiian ElectricHawaii Electric LightMaui ElectricOther
subsi-diaries		Consoli-
dating
adjustments		Hawaiian Electric
Consolidated
Assets      
Property, plant and equipment
Utility property, plant and equipment      
Land$42,737 5,606 3,594 — — $51,937 
Plant and equipment5,097,033 1,390,361 1,248,589 — — 7,735,983 
Less accumulated depreciation(1,757,096)(619,991)(563,430)— — (2,940,517)
Construction in progress159,854 17,129 27,586 — — 204,569 
Utility property, plant and equipment, net3,542,528 793,105 716,339 — — 5,051,972 
Nonutility property, plant and equipment, less accumulated depreciation
5,302 115 1,532 — — 6,949 
Total property, plant and equipment, net3,547,830 793,220 717,871 — — 5,058,921 
Investment in wholly owned subsidiaries, at equity
676,237 — — — (676,237)— 
Current assets      
Cash and cash equivalents23,344 5,326 23,422 77 — 52,169 
Restricted cash3,089 — — — — 3,089 
Advances to affiliates1,000 — — — (1,000)— 
Customer accounts receivable, net135,949 28,469 22,441 — — 186,859 
Accrued unbilled revenues, net92,469 19,529 17,157 — — 129,155 
Other accounts receivable, net18,624 3,347 3,031 — (17,735)7,267 
Fuel oil stock, at average cost71,184 12,814 20,080 — — 104,078 
Materials and supplies, at average cost42,006 9,727 20,144 — — 71,877 
Prepayments and other32,140 6,052 7,114 — 725 46,031 
Regulatory assets58,695 3,051 4,918 — — 66,664 
Total current assets478,500 88,315 118,307 77 (18,010)667,189 
Other long-term assets      
Operating lease right-of-use assets78,710 22,442 318 — — 101,470 
Regulatory assets337,903 81,645 79,331 — — 498,879 
Other130,546 17,124 18,510 — (1,014)165,166 
Total other long-term assets547,159 121,211 98,159 — (1,014)765,515 
Total assets$5,249,726 1,002,746 934,337 77 (695,261)$6,491,625 
Capitalization and liabilities      
Capitalization
Common stock equity$2,261,899 332,900 343,260 77 (676,237)$2,261,899 
Cumulative preferred stock—not subject to mandatory redemption
22,293 7,000 5,000 — — 34,293 
Long-term debt, net1,136,620 234,390 253,417 — — 1,624,427 
Total capitalization3,420,812 574,290 601,677 77 (676,237)3,920,619 
Current liabilities     
Current portion of operating lease liabilities45,955 3,378 35 — — 49,368 
Current portion of long-term debt39,981 11,994 — — — 51,975 
Short-term borrowings-affiliate— 1,000 — — (1,000)— 
Accounts payable111,024 26,139 22,844 — — 160,007 
Interest and preferred dividends payable12,442 2,617 2,269 — (3)17,325 
Taxes accrued, including revenue taxes143,723 33,153 30,679 — 725 208,280 
Regulatory liabilities22,240 3,247 4,273 — — 29,760 
Other56,752 14,158 18,540 — (17,881)71,569 
Total current liabilities432,117 95,686 78,640 — (18,159)588,284 
Deferred credits and other liabilities     
Operating lease liabilities46,426 19,063 291 — — 65,780 
Deferred income taxes291,027 53,298 64,309 — — 408,634 
Regulatory liabilities695,152 179,267 92,589 — — 967,008 
Unamortized tax credits76,201 14,212 13,532 — — 103,945 
Defined benefit pension and other postretirement benefit plans liability
220,480 48,900 53,257 — (857)321,780 
Other67,511 18,030 30,042 — (8)115,575 
Total deferred credits and other liabilities1,396,797 332,770 254,020 — (865)1,982,722 
Total capitalization and liabilities$5,249,726 1,002,746 934,337 77 (695,261)$6,491,625 
Hawaiian Electric Company, Inc. and Subsidiaries
Condensed Consolidating Statement of Changes in Common Stock Equity
Nine months ended September 30, 2022
(in thousands)Hawaiian ElectricHawaii Electric LightMaui ElectricOther
subsidiaries		Consolidating
adjustments		Hawaiian Electric
Consolidated
Balance, December 31, 2021$2,261,899 332,900 343,260 77 (676,237)$2,261,899 
Net income for common stock140,308 17,994 18,481 — (36,475)140,308 
Other comprehensive income, net of taxes210 4 — — (4)210 
Common stock dividends(94,425)(12,300)(11,400)— 23,700 (94,425)
Balance, September 30, 2022$2,307,992 338,598 350,341 77 (689,016)$2,307,992 
 
Hawaiian Electric Company, Inc. and Subsidiaries
Condensed Consolidating Statement of Changes in Common Stock Equity
Nine months ended September 30, 2021
(in thousands)Hawaiian ElectricHawaii Electric LightMaui ElectricOther
subsidiaries		Consolidating
adjustments		Hawaiian Electric
Consolidated
Balance, December 31, 2020$2,141,918 317,451 309,363 77 (626,891)$2,141,918 
Net income for common stock135,601 17,187 18,095 — (35,282)135,601 
Other comprehensive income, net of taxes175 3 — — (3)175 
Common stock dividends(83,775)(10,950)(11,326)— 22,276 (83,775)
Balance, September 30, 2021$2,193,919 323,691 316,132 77 (639,900)$2,193,919 
Hawaiian Electric Company, Inc. and Subsidiaries
Condensed Consolidating Statement of Cash Flows
Nine months ended September 30, 2022
(in thousands)Hawaiian ElectricHawaii Electric LightMaui ElectricOther
subsidiaries		Consolidating
adjustments		Hawaiian Electric
Consolidated
Net cash provided by operating activities$74,053 38,302 35,512 — (23,700)$124,167 
Cash flows from investing activities      
Capital expenditures(152,015)(34,055)(39,806)— — (225,876)
Advances to affiliates1,000 (1,500)(16,000)— 16,500 — 
Other4,545 825 1,380 — — 6,750 
Net cash used in investing activities(146,470)(34,730)(54,426)— 16,500 (219,126)
Cash flows from financing activities      
Common stock dividends(94,425)(12,300)(11,400)— 23,700 (94,425)
Preferred stock dividends of Hawaiian Electric and subsidiaries(810)(400)(286)— — (1,496)
Proceeds from issuance of long-term debt40,000 10,000 10,000 — — 60,000 
Net increase (decrease) in short-term borrowings from non-affiliates and affiliate with original maturities of three months or less114,950 (1,000)— — (16,500)97,450 
Payments of obligations under finance leases(266)— — — — (266)
Other(170)(44)(44)— — (258)
Net cash provided by financing activities59,279 (3,744)(1,730)— 7,200 61,005 
Net decrease in cash and cash equivalents(13,138)(172)(20,644)— — (33,954)
Cash and cash equivalents, beginning of period26,433 5,326 23,422 77 — 55,258 
Cash and cash equivalents, end of period$13,295 5,154 2,778 77 — $21,304 
Hawaiian Electric Company, Inc. and Subsidiaries
Condensed Consolidating Statement of Cash Flows
Nine months ended September 30, 2021
(in thousands)Hawaiian ElectricHawaii Electric LightMaui ElectricOther
subsidiaries		Consolidating
adjustments		Hawaiian Electric
Consolidated
Net cash provided by operating activities$157,191 32,698 30,643 — (22,276)$198,256 
Cash flows from investing activities     
Capital expenditures (137,916)(33,511)(32,319)— — (203,746)
Advances from affiliates26,000 — — — (26,000)— 
Other4,136 1,121 900 — — 6,157 
Net cash used in investing activities(107,780)(32,390)(31,419)— (26,000)(197,589)
Cash flows from financing activities     
Common stock dividends(83,775)(10,950)(11,326)— 22,276 (83,775)
Preferred stock dividends of Hawaiian Electric and subsidiaries(810)(400)(286)— — (1,496)
Repayment of short-term debt(50,000)— — — — (50,000)
Proceeds from issuance of long-term debt60,000 30,000 25,000 — — 115,000 
Net decrease in short-term borrowings from non-affiliates and affiliate with original maturities of three months or less— (18,100)(7,900)— 26,000 — 
Other(703)(116)(123)— — (942)
Net cash provided by (used in) financing activities(75,288)434 5,365 — 48,276 (21,213)
Net increase (decrease) in cash, cash equivalents and restricted cash(25,877)742 4,589 — — (20,546)
Cash, cash equivalents and restricted cash, beginning of period58,171 3,046 2,032 77 — 63,326 
Cash, cash equivalents and restricted cash, end of period32,294 3,788 6,621 77 — 42,780 
Less: Restricted cash(6,313)— — — — (6,313)
Cash and cash equivalents, end of period$25,981 3,788 6,621 77 — $36,467