Retirement benefits

9 Months Ended

Sep. 30, 2019

Defined benefit pension and other postretirement benefit plans information. For the first nine months of 2019, the Company contributed $36 million ($36 million by the Utilities) to its pension and other postretirement benefit plans, compared to $38 million ($37 million by the Utilities) in the first nine months of 2018. The Company’s current estimate of total contributions to its pension and other postretirement benefit plans in 2019 is $49 million ($48 million by the Utilities, $1 million by HEI and nil by ASB), compared to $39 million ($38 million by the Utilities, $1 million by HEI and nil by ASB) in 2018. In addition, the Company expects to pay directly $3 million ($2 million by the Utilities) of benefits in 2019, compared to $2 million ($1 million by the Utilities) paid in 2018.

The components of net periodic pension costs (NPPC) and net periodic benefit costs (NPBC) for HEI consolidated and Hawaiian Electric consolidated were as follows:



	Three months ended September 30												Nine months ended September 30
	Pension benefits						Other benefits						Pension benefits						Other benefits
(in thousands)	2019			2018			2019			2018			2019			2018			2019			2018
HEI consolidated
Service cost	$	15,800		$	17,223		$	573		$	680		$	46,564		$	51,764		$	1,656		$	2,041
Interest cost	21,150			19,340			2,006			1,986			63,216			58,033			6,000			5,947
Expected return on plan assets	(27,991		)	(27,237		)	(3,101		)	(3,224		)	(83,988		)	(81,715		)	(9,273		)	(9,683		)
Amortization of net prior service gain	(10		)	(11		)	(451		)	(451		)	(32		)	(32		)	(1,355		)	(1,354		)
Amortization of net actuarial (gains) losses	3,989			7,527			(3		)	25			11,667			22,556			(10		)	71
Net periodic pension/benefit cost (return)	12,938			16,842			(976		)	(984		)	37,427			50,606			(2,982		)	(2,978		)
Impact of PUC D&Os	11,554			7,785			821			953			36,111			17,621			2,443			3,048
Net periodic pension/benefit cost (adjusted for impact of PUC D&Os)	$	24,492		$	24,627		$	(155	)	$	(31	)	$	73,538		$	68,227		$	(539	)	$	70
Hawaiian Electric consolidated
Service cost	$	15,344		$	16,840		$	568		$	676		$	45,346		$	50,520		$	1,643		$	2,028
Interest cost	19,560			17,824			1,920			1,907			58,388			53,471			5,755			5,721
Expected return on plan assets	(26,146		)	(25,593		)	(3,064		)	(3,178		)	(78,474		)	(76,777		)	(9,135		)	(9,534		)
Amortization of net prior service (gain) cost	2			2			(451		)	(451		)	6			6			(1,353		)	(1,353		)
Amortization of net actuarial loss	3,841			6,826			—			25			10,993			20,477			—			74
Net periodic pension/benefit cost (return)	12,601			15,899			(1,027		)	(1,021		)	36,259			47,697			(3,090		)	(3,064		)
Impact of PUC D&Os	11,554			7,785			821			953			36,111			17,621			2,443			3,048
Net periodic pension/benefit cost (adjusted for impact of PUC D&Os)	$	24,155		$	23,684		$	(206	)	$	(68	)	$	72,370		$	65,318		$	(647	)	$	(16	)

HEI consolidated recorded retirement benefits expense of $44 million ($43 million by the Utilities) and $43 million ($40 million by the Utilities) in the first nine months of 2019 and 2018, respectively, and charged the remaining net periodic benefit cost primarily to electric utility plant.

The Utilities have implemented pension and OPEB tracking mechanisms under which all of their retirement benefit expenses (except for executive life and nonqualified pension plan expenses) determined in accordance with GAAP are recovered over time. Under the tracking mechanisms, these retirement benefit costs that are over/under amounts allowed in rates are charged/credited to a regulatory asset/liability. The regulatory asset/liability for each utility will be amortized over 5 years beginning with the issuance of the PUC’s D&O in the respective utility’s next rate case.

Defined contribution plans information. For the first nine months of 2019 and 2018, the Company’s expenses for its defined contribution pension plans under the Hawaiian Electric Industries Retirement Savings Plan (HEIRSP) and the ASB 401(k) Plan were $5.1 million and $4.8 million, respectively, and cash contributions were $6.0 million and $5.9 million, respectively. For the first nine months of 2019 and 2018, the Utilities’ expenses for its defined contribution pension plan under the HEIRSP were $1.9 million and $1.7 million, respectively, and cash contributions were $1.9 million and $1.7 million, respectively.