Exact Name of Registrant as Specified in Its Charter | Commission File Number | I.R.S. Employer Identification No. | ||||||||||||
and Principal Subsidiary | ||||||||||||||
Registrant | Title of each class | Trading Symbol(s) | Name of each exchange on which registered | ||||||||
Hawaiian Electric Industries, Inc. |
Hawaiian Electric Industries, Inc. | ☒ | No | ☐ | Hawaiian Electric Company, Inc. | ☒ | No | ☐ |
Hawaiian Electric Industries, Inc. | ☒ | No | ☐ | Hawaiian Electric Company, Inc. | ☒ | No | ☐ |
Hawaiian Electric Industries, Inc.: | Hawaiian Electric Company, Inc.: | ||||||||||||||||||||||
☒ | Smaller reporting company | Large accelerated filer | ☐ | Smaller reporting company | |||||||||||||||||||
Accelerated filer | ☐ | Emerging growth company | Accelerated filer | ☐ | Emerging growth company | ||||||||||||||||||
Non-accelerated filer | ☐ | ☒ |
Hawaiian Electric Industries, Inc. | ☐ | Hawaiian Electric Company, Inc. | ☐ |
Hawaiian Electric Industries, Inc. | Yes | ☐ | No | Hawaiian Electric Company, Inc. | Yes | ☐ | No |
Class of Common Stock | Outstanding July 31, 2024 | ||||||||||
Hawaiian Electric Industries, Inc. (Without Par Value) | Shares | ||||||||||
Hawaiian Electric Company, Inc. ($6-2/3 Par Value) | Shares (not publicly traded) |
Page No. | |||||||||||
three and six months ended June 30, 2024 and 2023 | |||||||||||
three and six months ended June 30, 2024 and 2023 | |||||||||||
Condensed Consolidated Balance Sheets (unaudited) - June 30, 2024 and December 31, 2023 | |||||||||||
three and six months ended June 30, 2024 and 2023 | |||||||||||
six months ended June 30, 2024 and 2023 | |||||||||||
three and six months ended June 30, 2024 and 2023 | |||||||||||
Condensed Consolidated Statements of Comprehensive Income (unaudited) - three and six months ended June 30, 2024 and 2023 | |||||||||||
Condensed Consolidated Balance Sheets (unaudited) - June 30, 2024 and December 31, 2023 | |||||||||||
three and six months ended June 30, 2024 and 2023 | |||||||||||
six months ended June 30, 2024 and 2023 | |||||||||||
Terms | Definitions | |||||||
ABL Facility | Asset-based lending facility | |||||||
ABR | Alternate Base Rate | |||||||
ACL | Allowance for credit losses, which is the current credit loss standard, requires recording the allowance based on the expected loss model | |||||||
AES Hawaii | AES Hawaii, Inc. | |||||||
AOCI | Accumulated other comprehensive income/(loss) | |||||||
ARA | Annual revenue adjustment | |||||||
ASB | American Savings Bank, F.S.B., a wholly owned subsidiary of ASB Hawaii, Inc. | |||||||
ASB Hawaii | ASB Hawaii, Inc., a wholly owned subsidiary of Hawaiian Electric Industries, Inc. and the parent company of American Savings Bank, F.S.B. | |||||||
ASU | Accounting Standards Update | |||||||
CBRE | Community-based renewable energy | |||||||
Company | Hawaiian Electric Industries, Inc. and its direct and indirect subsidiaries, including, without limitation, Hawaiian Electric Company, Inc. and its subsidiaries (listed under Hawaiian Electric); ASB Hawaii, Inc. and its subsidiary, American Savings Bank, F.S.B. and Pacific Current, LLC and its subsidiaries (listed under Pacific Current). | |||||||
Consumer Advocate | Division of Consumer Advocacy, Department of Commerce and Consumer Affairs of the State of Hawaii | |||||||
CSSM | Collective Shared Savings Mechanism | |||||||
D&O | Decision and order from the PUC | |||||||
DER | Distributed energy resources | |||||||
DRIP | HEI Dividend Reinvestment and Stock Purchase Plan | |||||||
ECRC | Energy cost recovery clause | |||||||
EIP | 2010 Equity and Incentive Plan, as amended | |||||||
EPA | Environmental Protection Agency — federal | |||||||
EPRM | Exceptional Project Recovery Mechanism | |||||||
EPS | Earnings per share | |||||||
ESM | Earnings Sharing Mechanism | |||||||
EVE | Economic value of equity | |||||||
Exchange Act | Securities Exchange Act of 1934 | |||||||
FDIC | Federal Deposit Insurance Corporation | |||||||
federal | U.S. Government | |||||||
FHLB | Federal Home Loan Bank | |||||||
FHLMC | Federal Home Loan Mortgage Corporation | |||||||
Fitch | Fitch Ratings, Inc. | |||||||
FNMA | Federal National Mortgage Association | |||||||
FRB | Federal Reserve Board | |||||||
GAAP | Accounting principles generally accepted in the United States of America | |||||||
GHG | Greenhouse gas | |||||||
GNMA | Government National Mortgage Association | |||||||
GSPA | Grid Services Purchase Agreement | |||||||
Hamakua Energy | Hamakua Energy, LLC, an indirect subsidiary of Pacific Current | |||||||
Hawaii Electric Light | Hawaii Electric Light Company, Inc., an electric utility subsidiary of Hawaiian Electric Company, Inc. | |||||||
Hawaiian Electric | Hawaiian Electric Company, Inc., an electric utility subsidiary of Hawaiian Electric Industries, Inc. and parent company of Hawaii Electric Light Company, Inc., Maui Electric Company, Limited, Renewable Hawaii, Inc. and HE AR INTER LLC | |||||||
HEI | Hawaiian Electric Industries, Inc., direct parent company of Hawaiian Electric Company, Inc., ASB Hawaii, Inc. and Pacific Current, LLC. |
Terms | Definitions | |||||||
HEIRSP | Hawaiian Electric Industries Retirement Savings Plan | |||||||
HELOC | Home equity line of credit | |||||||
HPOWER | City and County of Honolulu with respect to a power purchase agreement for a refuse-fired plant | |||||||
IIJA | Infrastructure Investment and Jobs Act | |||||||
IPP | Independent power producer | |||||||
IRLCs | Interest rate lock commitments | |||||||
IWSM | Interim Wildfire Safety Measures | |||||||
Kalaeloa | Kalaeloa Partners, L.P. | |||||||
kWh | Kilowatthour/s (as applicable) | |||||||
LMI | Low-to-moderate income | |||||||
LTIP | Long-term incentive plan | |||||||
Mahipapa | Mahipapa, LLC, a subsidiary of Pacific Current | |||||||
Maui Electric | Maui Electric Company, Limited, an electric utility subsidiary of Hawaiian Electric Company, Inc. | |||||||
Maui windstorm and wildfires | The fires in the West Maui (Lahaina) and Upcountry Maui areas that caused fatalities and widespread property damage in Lahaina on August 8, 2023 | |||||||
Mauo | Mauo, LLC, a subsidiary of Pacific Current | |||||||
MFD | County of Maui Department of Fire and Public Safety | |||||||
Moody’s | Moody’s Investors Service’s | |||||||
MPIR | Major Project Interim Recovery | |||||||
MRP | Multi-year rate period | |||||||
MSRs | Mortgage servicing rights | |||||||
MW | Megawatt/s (as applicable) | |||||||
NII | Net interest income | |||||||
NPBC | Net periodic benefit costs | |||||||
NPPC | Net periodic pension costs | |||||||
O&M | Other operation and maintenance | |||||||
OCC | Office of the Comptroller of the Currency | |||||||
OPEB | Postretirement benefits other than pensions | |||||||
Pacific Current | Pacific Current, LLC, a wholly owned subsidiary of HEI and parent company of Hamakua Holdings, LLC, Mauo, LLC, Alenuihaha Developments, LLC, Kaʻieʻie Waho Company, LLC, Kaʻaipuaʻa, LLC, Upena, LLC and Mahipapa, LLC | |||||||
PBR | Performance-based regulation | |||||||
PIMs | Performance incentive mechanisms | |||||||
PPA | Power purchase agreement | |||||||
PPAC | Purchased power adjustment clause | |||||||
PSPS | Public Safety Power Shutoff | |||||||
PUC | Public Utilities Commission of the State of Hawaii | |||||||
PV | Photovoltaic | |||||||
RAM | Revenue adjustment mechanism | |||||||
RBA | Revenue balancing account | |||||||
RFP | Request for proposals | |||||||
ROACE | Return on average common equity | |||||||
RORB | Return on rate base | |||||||
RPS | Renewable portfolio standards | |||||||
S&P | S&P Global Ratings | |||||||
SBA | Small Business Administration | |||||||
SEC | Securities and Exchange Commission | |||||||
See | Means the referenced material is incorporated by reference | |||||||
SOFR | Secured Overnight Financing Rate | |||||||
Utilities | Hawaiian Electric Company, Inc., Hawaii Electric Light Company, Inc. and Maui Electric Company, Limited | |||||||
VIEs | Variable interest entities |
Three months ended June 30 | Six months ended June 30 | |||||||||||||||||||||||||
(in thousands, except per share amounts) | 2024 | 2023 | 2024 | 2023 | ||||||||||||||||||||||
Revenues | ||||||||||||||||||||||||||
Electric utility | $ | $ | $ | $ | ||||||||||||||||||||||
Bank | ||||||||||||||||||||||||||
Other | ||||||||||||||||||||||||||
Total revenues | ||||||||||||||||||||||||||
Expenses | ||||||||||||||||||||||||||
Electric utility (includes $ | ||||||||||||||||||||||||||
Bank (includes $ | ||||||||||||||||||||||||||
Other | ||||||||||||||||||||||||||
Total expenses | ||||||||||||||||||||||||||
Operating income (loss) | ||||||||||||||||||||||||||
Electric utility | ( | ( | ||||||||||||||||||||||||
Bank | ( | ( | ||||||||||||||||||||||||
Other | ( | ( | ( | ( | ||||||||||||||||||||||
Total operating income (loss) | ( | ( | ||||||||||||||||||||||||
Retirement defined benefits credit—other than service costs | ||||||||||||||||||||||||||
Interest expense, net—other than on deposit liabilities and other bank borrowings | ( | ( | ( | ( | ||||||||||||||||||||||
Allowance for borrowed funds used during construction | ||||||||||||||||||||||||||
Allowance for equity funds used during construction | ||||||||||||||||||||||||||
Interest income | ||||||||||||||||||||||||||
Income (loss) before income taxes | ( | ( | ||||||||||||||||||||||||
Income tax expense (benefit) | ( | ( | ||||||||||||||||||||||||
Net income (loss) | ( | ( | ||||||||||||||||||||||||
Preferred stock dividends of subsidiaries | ||||||||||||||||||||||||||
Net income (loss) for common stock | $ | ( | $ | $ | ( | $ | ||||||||||||||||||||
Basic earnings (loss) per common share | $ | ( | $ | $ | ( | $ | ||||||||||||||||||||
Diluted earnings (loss) per common share | $ | ( | $ | $ | ( | $ | ||||||||||||||||||||
Weighted-average number of common shares outstanding: | ||||||||||||||||||||||||||
Basic | ||||||||||||||||||||||||||
Diluted |
Three months ended June 30 | Six months ended June 30 | |||||||||||||||||||||||||
(in thousands) | 2024 | 2023 | 2024 | 2023 | ||||||||||||||||||||||
Net income (loss) for common stock | $ | ( | $ | $ | ( | $ | ||||||||||||||||||||
Other comprehensive income (loss), net of taxes: | ||||||||||||||||||||||||||
Net unrealized gains (losses) on available-for-sale investment securities: | ||||||||||||||||||||||||||
Net unrealized gains (losses) on available-for-sale investment securities arising during the period, net of taxes of $( | ( | ( | ( | |||||||||||||||||||||||
Amortization of unrealized holding losses on held-to-maturity securities, net of taxes of $ | ||||||||||||||||||||||||||
Derivatives qualifying as cash flow hedges: | ||||||||||||||||||||||||||
Unrealized interest rate hedging gains (losses) arising during the period, net of taxes of $ | ( | ( | ||||||||||||||||||||||||
Reclassification adjustment to net income, net of taxes of $( | ( | ( | ( | ( | ||||||||||||||||||||||
Retirement benefit plans: | ||||||||||||||||||||||||||
Adjustment for amortization of prior service credit and net gains recognized during the period in net periodic benefit cost, net of taxes of $( | ( | ( | ( | ( | ||||||||||||||||||||||
Reclassification adjustment for impact of D&Os of the PUC included in regulatory assets, net of taxes of $ | ||||||||||||||||||||||||||
Other comprehensive income (loss), net of taxes | ( | ( | ||||||||||||||||||||||||
Comprehensive income (loss) attributable to Hawaiian Electric Industries, Inc. | $ | ( | $ | $ | ( | $ |
(dollars in thousands) | June 30, 2024 | December 31, 2023 | ||||||||||||
Assets | ||||||||||||||
Cash and cash equivalents | $ | $ | ||||||||||||
Restricted cash | ||||||||||||||
Accounts receivable and unbilled revenues, net | ||||||||||||||
Available-for-sale investment securities, at fair value | ||||||||||||||
Held-to-maturity investment securities, at amortized cost | ||||||||||||||
Stock in Federal Home Loan Bank, at cost | ||||||||||||||
Loans held for investment, net | ||||||||||||||
Loans held for sale, at lower of cost or fair value | ||||||||||||||
Property, plant and equipment, net of accumulated depreciation of $ | ||||||||||||||
Operating lease right-of-use assets | ||||||||||||||
Regulatory assets | ||||||||||||||
Other | ||||||||||||||
Goodwill | ||||||||||||||
Total assets | $ | $ | ||||||||||||
Liabilities and shareholders’ equity | ||||||||||||||
Liabilities | ||||||||||||||
Accounts payable | $ | $ | ||||||||||||
Interest and dividends payable | ||||||||||||||
Deposit liabilities | ||||||||||||||
Other bank borrowings | ||||||||||||||
Long-term debt, net—other than bank | ||||||||||||||
Deferred income taxes | ||||||||||||||
Operating lease liabilities | ||||||||||||||
Finance lease liabilities | ||||||||||||||
Regulatory liabilities | ||||||||||||||
Defined benefit pension and other postretirement benefit plans liability | ||||||||||||||
Wildfire tort-related claims | ||||||||||||||
Other | ||||||||||||||
Total liabilities | ||||||||||||||
Preferred stock of subsidiaries - not subject to mandatory redemption | ||||||||||||||
Commitments and contingencies (Notes 2, 4 and 5) | ||||||||||||||
Shareholders’ equity | ||||||||||||||
Preferred stock, | ||||||||||||||
Common stock, | ||||||||||||||
Retained earnings (deficit) | ( | |||||||||||||
Accumulated other comprehensive loss, net of tax benefits | ( | ( | ||||||||||||
Total shareholders’ equity | ||||||||||||||
Total liabilities and shareholders’ equity | $ | $ |
Common stock | Retained earnings | Accumulated other comprehensive | ||||||||||||||||||||||||||||||
(in thousands) | Shares | Amount | (deficit) | income (loss) | Total | |||||||||||||||||||||||||||
Balance, December 31, 2023 | $ | $ | $ | ( | $ | |||||||||||||||||||||||||||
Net income for common stock | — | — | — | |||||||||||||||||||||||||||||
Other comprehensive loss, net of tax benefits | — | — | — | ( | ( | |||||||||||||||||||||||||||
Share-based expenses and other, net | — | — | ||||||||||||||||||||||||||||||
Balance, March 31, 2024 | ( | |||||||||||||||||||||||||||||||
Net loss for common stock | — | — | ( | — | ( | |||||||||||||||||||||||||||
Other comprehensive income, net of taxes | — | — | — | |||||||||||||||||||||||||||||
Share-based expenses and other, net | — | — | — | |||||||||||||||||||||||||||||
Balance, June 30, 2024 | $ | $ | ( | $ | ( | $ | ||||||||||||||||||||||||||
Balance, December 31, 2022 | $ | $ | $ | ( | $ | |||||||||||||||||||||||||||
Net income for common stock | — | — | — | |||||||||||||||||||||||||||||
Other comprehensive income, net of taxes | — | — | — | |||||||||||||||||||||||||||||
Share-based expenses and other, net | ( | — | — | ( | ||||||||||||||||||||||||||||
Common stock dividends ( | — | — | ( | — | ( | |||||||||||||||||||||||||||
Balance, March 31, 2023 | ( | |||||||||||||||||||||||||||||||
Net income for common stock | — | — | — | |||||||||||||||||||||||||||||
Other comprehensive loss, net of tax benefits | — | — | — | ( | ( | |||||||||||||||||||||||||||
Share-based expenses and other, net | — | — | ||||||||||||||||||||||||||||||
Common stock dividends ( | — | — | ( | — | ( | |||||||||||||||||||||||||||
Balance, June 30, 2023 | $ | $ | $ | ( | $ | |||||||||||||||||||||||||||
Six months ended June 30 | ||||||||||||||
(in thousands) | 2024 | 2023 | ||||||||||||
Cash flows from operating activities | ||||||||||||||
Net income (loss) | $ | ( | $ | |||||||||||
Adjustments to reconcile net income (loss) to net cash provided by operating activities | ||||||||||||||
Depreciation of property, plant and equipment | ||||||||||||||
Other amortization | ||||||||||||||
Provision for credit losses | ( | |||||||||||||
Loans originated, held for sale | ( | ( | ||||||||||||
Proceeds from sale of loans, held for sale | ||||||||||||||
Gain on sale of loans, net | ( | ( | ||||||||||||
Deferred income tax expense (benefit) | ( | ( | ||||||||||||
Share-based compensation expense | ||||||||||||||
Allowance for equity funds used during construction | ( | ( | ||||||||||||
Goodwill impairment | ||||||||||||||
Other | ( | |||||||||||||
Changes in assets and liabilities | ||||||||||||||
Decrease in accounts receivable and unbilled revenues, net | ||||||||||||||
Decrease in fuel oil stock | ||||||||||||||
Decrease (increase) in materials and supplies | ( | |||||||||||||
Increase in regulatory assets | ( | ( | ||||||||||||
Increase in regulatory liabilities | ||||||||||||||
Increase in accounts, interest and dividends payable | ||||||||||||||
Change in prepaid and accrued income taxes, tax credits and utility revenue taxes | ( | ( | ||||||||||||
Decrease in defined benefit pension and other postretirement benefit plans liability | ( | ( | ||||||||||||
Increase in Wildfire tort-related claims | ||||||||||||||
Change in other assets and liabilities | ( | ( | ||||||||||||
Net cash provided by operating activities | ||||||||||||||
Cash flows from investing activities | ||||||||||||||
Principal repayments on available-for-sale investment securities | ||||||||||||||
Proceeds from repayments or maturities of held-to-maturity investment securities | ||||||||||||||
Purchase of stock from Federal Home Loan Bank | ( | ( | ||||||||||||
Redemption of stock from Federal Home Loan Bank | ||||||||||||||
Net decrease (increase) in loans held for investment | ( | |||||||||||||
Proceeds from sale of commercial loans | ||||||||||||||
Purchase of loans held for investment | ( | |||||||||||||
Capital expenditures | ( | ( | ||||||||||||
Other | ( | |||||||||||||
Net cash provided by (used in) investing activities | ( |
Six months ended June 30 | ||||||||||||||
(in thousands) | 2024 | 2023 | ||||||||||||
Cash flows from financing activities | ||||||||||||||
Net decrease in deposit liabilities | ( | ( | ||||||||||||
Net decrease in short-term borrowings with original maturities of three months or less | ( | |||||||||||||
Net decrease in other bank borrowings with original maturities of three months or less | ( | |||||||||||||
Proceeds from issuance of short-term debt | ||||||||||||||
Repayment of short-term debt | ( | |||||||||||||
Proceeds from issuance of other bank borrowings | ||||||||||||||
Repayment of other bank borrowings | ( | ( | ||||||||||||
Proceeds from issuance of long-term debt | ||||||||||||||
Repayment of long-term debt | ( | ( | ||||||||||||
Withheld shares for employee taxes on vested share-based compensation | ( | ( | ||||||||||||
Common stock dividends | ( | |||||||||||||
Preferred stock dividends of subsidiaries | ( | ( | ||||||||||||
Other | ( | ( | ||||||||||||
Net cash provided by (used in) financing activities | ( | |||||||||||||
Net increase (decrease) in cash, cash equivalents and restricted cash | ( | |||||||||||||
Cash, cash equivalents and restricted cash, beginning of period | ||||||||||||||
Cash, cash equivalents and restricted cash, end of period | ||||||||||||||
Less: Restricted cash | ( | ( | ||||||||||||
Cash and cash equivalents, end of period | $ | $ |
Three months ended June 30 | Six months ended June 30 | |||||||||||||||||||||||||
(in thousands) | 2024 | 2023 | 2024 | 2023 | ||||||||||||||||||||||
Revenues | $ | $ | $ | $ | ||||||||||||||||||||||
Expenses | ||||||||||||||||||||||||||
Fuel oil | ||||||||||||||||||||||||||
Purchased power | ||||||||||||||||||||||||||
Other operation and maintenance | ||||||||||||||||||||||||||
Wildfire tort-related claims (Note 2) | ||||||||||||||||||||||||||
Depreciation | ||||||||||||||||||||||||||
Taxes, other than income taxes | ||||||||||||||||||||||||||
Total expenses | ||||||||||||||||||||||||||
Operating income (loss) | ( | ( | ||||||||||||||||||||||||
Allowance for equity funds used during construction | ||||||||||||||||||||||||||
Retirement defined benefits credit—other than service costs | ||||||||||||||||||||||||||
Interest expense and other charges, net | ( | ( | ( | ( | ||||||||||||||||||||||
Allowance for borrowed funds used during construction | ||||||||||||||||||||||||||
Interest income | ||||||||||||||||||||||||||
Income (loss) before income taxes | ( | ( | ||||||||||||||||||||||||
Income tax expense (benefit) | ( | ( | ||||||||||||||||||||||||
Net income (loss) | ( | ( | ||||||||||||||||||||||||
Preferred stock dividends of subsidiaries | ||||||||||||||||||||||||||
Net income (loss) attributable to Hawaiian Electric | ( | ( | ||||||||||||||||||||||||
Preferred stock dividends of Hawaiian Electric | ||||||||||||||||||||||||||
Net income (loss) for common stock | $ | ( | $ | $ | ( | $ |
Three months ended June 30 | Six months ended June 30 | |||||||||||||||||||||||||
(in thousands) | 2024 | 2023 | 2024 | 2023 | ||||||||||||||||||||||
Net income (loss) for common stock | $ | ( | $ | $ | ( | $ | ||||||||||||||||||||
Other comprehensive loss, net of taxes: | ||||||||||||||||||||||||||
Retirement benefit plans: | ||||||||||||||||||||||||||
Adjustment for amortization of prior service credit and net gains recognized during the period in net periodic benefit cost, net of taxes of $( | ( | ( | ( | ( | ||||||||||||||||||||||
Reclassification adjustment for impact of D&Os of the PUC included in regulatory assets, net of taxes of $ | ||||||||||||||||||||||||||
Other comprehensive loss, net of taxes | ( | ( | ( | ( | ||||||||||||||||||||||
Comprehensive income (loss) attributable to Hawaiian Electric Company, Inc. | $ | ( | $ | $ | ( | $ |
(dollars in thousands, except par value) | June 30, 2024 | December 31, 2023 | ||||||||||||
Assets | ||||||||||||||
Property, plant and equipment | ||||||||||||||
Utility property, plant and equipment | ||||||||||||||
Land | $ | $ | ||||||||||||
Plant and equipment | ||||||||||||||
Right-of-use assets - finance lease | ||||||||||||||
Less accumulated depreciation | ( | ( | ||||||||||||
Construction in progress | ||||||||||||||
Utility property, plant and equipment, net | ||||||||||||||
Nonutility property, plant and equipment, less accumulated depreciation of $ | ||||||||||||||
Total property, plant and equipment, net | ||||||||||||||
Current assets | ||||||||||||||
Cash and cash equivalents | ||||||||||||||
Restricted cash | ||||||||||||||
Customer accounts receivable, net | ||||||||||||||
Accrued unbilled revenues, net | ||||||||||||||
Other accounts receivable, net | ||||||||||||||
Fuel oil stock, at average cost | ||||||||||||||
Materials and supplies, at average cost | ||||||||||||||
Prepayments and other | ||||||||||||||
Regulatory assets | ||||||||||||||
Total current assets | ||||||||||||||
Other long-term assets | ||||||||||||||
Operating lease right-of-use assets | ||||||||||||||
Regulatory assets | ||||||||||||||
Other | ||||||||||||||
Total other long-term assets | ||||||||||||||
Total assets | $ | $ | ||||||||||||
(dollars in thousands, except par value) | June 30, 2024 | December 31, 2023 | ||||||||||||
Capitalization and liabilities | ||||||||||||||
Capitalization | ||||||||||||||
Common stock ($6 2/3 par value, authorized | $ | $ | ||||||||||||
Premium on capital stock | ||||||||||||||
Retained earnings | ||||||||||||||
Accumulated other comprehensive income, net of taxes-retirement benefit plans | ||||||||||||||
Common stock equity | ||||||||||||||
Cumulative preferred stock — not subject to mandatory redemption | ||||||||||||||
Long-term debt, net | ||||||||||||||
Total capitalization | ||||||||||||||
Commitments and contingencies (Notes 2 and 4) | ||||||||||||||
Current liabilities | ||||||||||||||
Current portion of operating lease liabilities | ||||||||||||||
Current portion of long-term debt, net | ||||||||||||||
Accounts payable | ||||||||||||||
Interest and preferred dividends payable | ||||||||||||||
Taxes accrued, including revenue taxes | ||||||||||||||
Regulatory liabilities | ||||||||||||||
Wildfire tort-related claims (Note 2) | ||||||||||||||
Other | ||||||||||||||
Total current liabilities | ||||||||||||||
Deferred credits and other liabilities | ||||||||||||||
Operating lease liabilities | ||||||||||||||
Finance lease liabilities | ||||||||||||||
Deferred income taxes | ||||||||||||||
Regulatory liabilities | ||||||||||||||
Unamortized tax credits | ||||||||||||||
Defined benefit pension liability | ||||||||||||||
Other | ||||||||||||||
Total deferred credits and other liabilities | ||||||||||||||
Total capitalization and liabilities | $ | $ |
Common stock | Premium on capital | Retained | Accumulated other comprehensive | |||||||||||||||||||||||||||||||||||
(in thousands) | Shares | Amount | stock | earnings | income | Total | ||||||||||||||||||||||||||||||||
Balance, December 31, 2023 | $ | $ | $ | $ | $ | |||||||||||||||||||||||||||||||||
Net income for common stock | — | — | — | — | ||||||||||||||||||||||||||||||||||
Other comprehensive loss, net of taxes | — | — | — | — | ( | ( | ||||||||||||||||||||||||||||||||
Common stock dividends | — | — | — | ( | — | ( | ||||||||||||||||||||||||||||||||
Balance, March 31, 2024 | ||||||||||||||||||||||||||||||||||||||
Net loss for common stock | — | — | — | ( | — | ( | ||||||||||||||||||||||||||||||||
Other comprehensive loss, net of taxes | — | — | — | — | ( | ( | ||||||||||||||||||||||||||||||||
Common stock dividends | — | — | — | ( | — | ( | ||||||||||||||||||||||||||||||||
Balance, June 30, 2024 | $ | $ | $ | $ | $ | |||||||||||||||||||||||||||||||||
Balance, December 31, 2022 | $ | $ | $ | $ | $ | |||||||||||||||||||||||||||||||||
Net income for common stock | — | — | — | — | ||||||||||||||||||||||||||||||||||
Other comprehensive loss, net of taxes | — | — | — | — | ( | ( | ||||||||||||||||||||||||||||||||
Common stock dividends | — | — | — | ( | — | ( | ||||||||||||||||||||||||||||||||
Balance, March 31, 2023 | ||||||||||||||||||||||||||||||||||||||
Net income for common stock | — | — | — | — | ||||||||||||||||||||||||||||||||||
Other comprehensive loss, net of taxes | — | — | — | — | ( | ( | ||||||||||||||||||||||||||||||||
Common stock dividends | — | — | — | ( | — | ( | ||||||||||||||||||||||||||||||||
Balance, June 30, 2023 | $ | $ | $ | $ | $ | |||||||||||||||||||||||||||||||||
Six months ended June 30 | ||||||||||||||
(in thousands) | 2024 | 2023 | ||||||||||||
Cash flows from operating activities | ||||||||||||||
Net income (loss) | $ | ( | $ | |||||||||||
Adjustments to reconcile net income (loss) to net cash provided by operating activities | ||||||||||||||
Depreciation of property, plant and equipment | ||||||||||||||
Other amortization | ||||||||||||||
Deferred income tax expense (benefit) | ( | ( | ||||||||||||
State refundable credit | ( | ( | ||||||||||||
Bad debt expense | ||||||||||||||
Allowance for equity funds used during construction | ( | ( | ||||||||||||
Other | ||||||||||||||
Changes in assets and liabilities | ||||||||||||||
Decrease in accounts receivable | ||||||||||||||
Decrease in accrued unbilled revenues | ||||||||||||||
Decrease in fuel oil stock | ||||||||||||||
Decrease (increase) in materials and supplies | ( | |||||||||||||
Increase in regulatory assets | ( | ( | ||||||||||||
Increase in regulatory liabilities | ||||||||||||||
Increase in accounts payable | ||||||||||||||
Change in prepaid and accrued income taxes, tax credits and revenue taxes | ( | ( | ||||||||||||
Decrease in defined benefit pension and other postretirement benefit plans liability | ( | ( | ||||||||||||
Increase in Wildfire tort-related claims | ||||||||||||||
Change in other assets and liabilities | ( | ( | ||||||||||||
Net cash provided by operating activities | ||||||||||||||
Cash flows from investing activities | ||||||||||||||
Capital expenditures | ( | ( | ||||||||||||
Other | ||||||||||||||
Net cash used in investing activities | ( | ( | ||||||||||||
Cash flows from financing activities | ||||||||||||||
Common stock dividends | ( | ( | ||||||||||||
Preferred stock dividends of Hawaiian Electric and subsidiaries | ( | ( | ||||||||||||
Proceeds from issuance of long-term debt | ||||||||||||||
Net decrease in short-term borrowings from non-affiliates and affiliates with original maturities of three months or less | ( | |||||||||||||
Payments of obligations under finance leases | ( | ( | ||||||||||||
Other | ( | ( | ||||||||||||
Net cash used in financing activities | ( | ( | ||||||||||||
Net increase (decrease) in cash, cash equivalents and restricted cash | ( | |||||||||||||
Cash, cash equivalents and restricted cash, beginning of period | ||||||||||||||
Cash, cash equivalents and restricted cash, end of period | ||||||||||||||
Less: Restricted cash | ( | |||||||||||||
Cash and cash equivalents, end of period | $ | $ |
Year ended December 31, 2023 | Three months ended June 30, 2024 | Six months ended June 30, 2024 | |||||||||||||||||||||||||||||||||
(in thousands) | Electric utility | HEI Consolidated | Electric utility | HEI Consolidated | Electric utility | HEI Consolidated | |||||||||||||||||||||||||||||
Maui windstorm and wildfires related expenses: | |||||||||||||||||||||||||||||||||||
Legal expenses | $ | $ | $ | $ | $ | $ | |||||||||||||||||||||||||||||
Wildfire tort-related claims | |||||||||||||||||||||||||||||||||||
Other expense | |||||||||||||||||||||||||||||||||||
Total Maui windstorm and wildfires related expenses | |||||||||||||||||||||||||||||||||||
Insurance recoveries | ( | ( | ( | ( | ( | ( | |||||||||||||||||||||||||||||
Deferral treatment approved by the PUC1 | ( | ( | ( | ( | ( | ( | |||||||||||||||||||||||||||||
Total Maui windstorm and wildfires related expenses, net of insurance recoveries and approved deferral treatment | $ | $ | $ | $ | $ | $ |
(in thousands) | Electric utility | Bank | Other | Total | ||||||||||||||||||||||
Three months ended June 30, 2024 | ||||||||||||||||||||||||||
Revenues | $ | $ | $ | $ | ||||||||||||||||||||||
Income (loss) before income taxes | $ | ( | $ | ( | $ | ( | $ | ( | ||||||||||||||||||
Income taxes (benefit) | ( | ( | ( | ( | ||||||||||||||||||||||
Net income (loss) | ( | ( | ( | ( | ||||||||||||||||||||||
Preferred stock dividends of subsidiaries | ( | |||||||||||||||||||||||||
Net income (loss) for common stock | $ | ( | $ | ( | $ | ( | $ | ( | ||||||||||||||||||
Six months ended June 30, 2024 | ||||||||||||||||||||||||||
Revenues | $ | $ | $ | $ | ||||||||||||||||||||||
Income (loss) before income taxes | $ | ( | $ | ( | $ | ( | $ | ( | ||||||||||||||||||
Income taxes (benefit) | ( | ( | ( | ( | ||||||||||||||||||||||
Net income (loss) | ( | ( | ( | ( | ||||||||||||||||||||||
Preferred stock dividends of subsidiaries | ( | |||||||||||||||||||||||||
Net income (loss) for common stock | $ | ( | $ | ( | $ | ( | $ | ( | ||||||||||||||||||
Total assets (at June 30, 2024) | $ | $ | $ | $ | ||||||||||||||||||||||
Three months ended June 30, 2023 | ||||||||||||||||||||||||||
Revenues | $ | $ | $ | $ | ||||||||||||||||||||||
Income (loss) before income taxes | $ | $ | $ | ( | $ | |||||||||||||||||||||
Income taxes (benefit) | ( | |||||||||||||||||||||||||
Net income (loss) | ( | |||||||||||||||||||||||||
Preferred stock dividends of subsidiaries | ( | |||||||||||||||||||||||||
Net income (loss) for common stock | $ | $ | $ | ( | $ | |||||||||||||||||||||
Six months ended June 30, 2023 | ||||||||||||||||||||||||||
Revenues | $ | $ | $ | $ | ||||||||||||||||||||||
Income (loss) before income taxes | $ | $ | $ | ( | $ | |||||||||||||||||||||
Income taxes (benefit) | ( | |||||||||||||||||||||||||
Net income (loss) | ( | |||||||||||||||||||||||||
Preferred stock dividends of subsidiaries | ( | |||||||||||||||||||||||||
Net income (loss) for common stock | $ | $ | $ | ( | $ | |||||||||||||||||||||
Total assets (at December 31, 2023) | $ | $ | $ | $ |
Three months ended June 30 | Six months ended June 30 | |||||||||||||||||||||||||
(in millions) | 2024 | 2023 | 2024 | 2023 | ||||||||||||||||||||||
Kalaeloa | $ | $ | $ | $ | ||||||||||||||||||||||
HPOWER | ||||||||||||||||||||||||||
Puna Geothermal Venture | ||||||||||||||||||||||||||
Hamakua Energy | ||||||||||||||||||||||||||
Kapolei Energy Storage | ||||||||||||||||||||||||||
Wind IPPs | ||||||||||||||||||||||||||
Solar IPPs | ||||||||||||||||||||||||||
Other IPPs 1 | ||||||||||||||||||||||||||
Total IPPs | $ | $ | $ | $ |
(in millions) | Hawaiian Electric | Hawaii Electric Light | Maui Electric | Total | ||||||||||||||||||||||
Recovery of COVID-19 related costs | $ | $ | $ | $ | ||||||||||||||||||||||
Return of ERP benefit liability | ( | ( | ( | |||||||||||||||||||||||
Net 2024 ARA revenues | $ | $ | ( | $ | ( | $ | ||||||||||||||||||||
(in millions) | Hawaiian Electric | Hawaii Electric Light | Maui Electric | Total | ||||||||||||||||||||||
Incremental ARA revenues | $ | $ | ( | $ | ( | $ | ||||||||||||||||||||
Incremental PIMs (net) | ( | ( | ( | ( | ||||||||||||||||||||||
Incremental MPIR/EPRM revenue adjustment | ||||||||||||||||||||||||||
Incremental Pilot Process cost recovery | ||||||||||||||||||||||||||
Net incremental amount to be collected (refunded) under the RBA rate tariffs | $ | $ | ( | $ | $ | |||||||||||||||||||||
(in thousands) | Hawaiian Electric | Hawaii Electric Light | Maui Electric | Other subsidiaries | Consolidating adjustments | Hawaiian Electric Consolidated | ||||||||||||||||||||||||||||||||
Revenues | $ | $ | ||||||||||||||||||||||||||||||||||||
Expenses | ||||||||||||||||||||||||||||||||||||||
Fuel oil | ||||||||||||||||||||||||||||||||||||||
Purchased power | ||||||||||||||||||||||||||||||||||||||
Other operation and maintenance | ||||||||||||||||||||||||||||||||||||||
Wildfire tort-related claims (Note 2) | ||||||||||||||||||||||||||||||||||||||
Depreciation | ||||||||||||||||||||||||||||||||||||||
Taxes, other than income taxes | ||||||||||||||||||||||||||||||||||||||
Total expenses | ||||||||||||||||||||||||||||||||||||||
Operating loss | ( | ( | ( | ( | ||||||||||||||||||||||||||||||||||
Allowance for equity funds used during construction | ||||||||||||||||||||||||||||||||||||||
Equity in earnings of subsidiaries | ( | |||||||||||||||||||||||||||||||||||||
Retirement defined benefits credit (expense)—other than service costs | ( | |||||||||||||||||||||||||||||||||||||
Interest expense and other charges, net | ( | ( | ( | ( | ||||||||||||||||||||||||||||||||||
Allowance for borrowed funds used during construction | ||||||||||||||||||||||||||||||||||||||
Interest Income | ( | |||||||||||||||||||||||||||||||||||||
Loss before income taxes | ( | ( | ( | ( | ||||||||||||||||||||||||||||||||||
Income tax benefit | ( | ( | ( | ( | ||||||||||||||||||||||||||||||||||
Net loss | ( | ( | ( | ( | ||||||||||||||||||||||||||||||||||
Preferred stock dividends of subsidiaries | ||||||||||||||||||||||||||||||||||||||
Net loss attributable to Hawaiian Electric | ( | ( | ( | ( | ||||||||||||||||||||||||||||||||||
Preferred stock dividends of Hawaiian Electric | ||||||||||||||||||||||||||||||||||||||
Net loss for common stock | $ | ( | ( | ( | $ | ( |
(in thousands) | Hawaiian Electric | Hawaii Electric Light | Maui Electric | Other subsidiaries | Consolidating adjustments | Hawaiian Electric Consolidated | ||||||||||||||||||||||||||||||||
Net loss for common stock | $ | ( | ( | ( | $ | ( | ||||||||||||||||||||||||||||||||
Other comprehensive loss, net of taxes: | ||||||||||||||||||||||||||||||||||||||
Retirement benefit plans: | ||||||||||||||||||||||||||||||||||||||
Adjustment for amortization of net gains recognized during the period in net periodic benefit cost, net of taxes | ( | ( | ( | ( | ||||||||||||||||||||||||||||||||||
Reclassification adjustment for impact of D&Os of the PUC included in regulatory assets, net of taxes | ( | |||||||||||||||||||||||||||||||||||||
Other comprehensive loss, net of taxes | ( | ( | ( | ( | ||||||||||||||||||||||||||||||||||
Comprehensive loss attributable to common shareholder | $ | ( | ( | ( | $ | ( |
(in thousands) | Hawaiian Electric | Hawaii Electric Light | Maui Electric | Other subsidiary | Consolidating adjustments | Hawaiian Electric Consolidated | ||||||||||||||||||||||||||||||||
Revenues | $ | $ | ||||||||||||||||||||||||||||||||||||
Expenses | ||||||||||||||||||||||||||||||||||||||
Fuel oil | ||||||||||||||||||||||||||||||||||||||
Purchased power | ||||||||||||||||||||||||||||||||||||||
Other operation and maintenance | ||||||||||||||||||||||||||||||||||||||
Depreciation | ||||||||||||||||||||||||||||||||||||||
Taxes, other than income taxes | ||||||||||||||||||||||||||||||||||||||
Total expenses | ||||||||||||||||||||||||||||||||||||||
Operating income | ||||||||||||||||||||||||||||||||||||||
Allowance for equity funds used during construction | ||||||||||||||||||||||||||||||||||||||
Equity in earnings of subsidiaries | ( | |||||||||||||||||||||||||||||||||||||
Retirement defined benefits credit (expense)—other than service costs | ( | |||||||||||||||||||||||||||||||||||||
Interest expense and other charges, net | ( | ( | ( | ( | ||||||||||||||||||||||||||||||||||
Allowance for borrowed funds used during construction | ||||||||||||||||||||||||||||||||||||||
Income before income taxes | ( | |||||||||||||||||||||||||||||||||||||
Income taxes | ||||||||||||||||||||||||||||||||||||||
Net income | ( | |||||||||||||||||||||||||||||||||||||
Preferred stock dividends of subsidiaries | ||||||||||||||||||||||||||||||||||||||
Net income attributable to Hawaiian Electric | ( | |||||||||||||||||||||||||||||||||||||
Preferred stock dividends of Hawaiian Electric | ||||||||||||||||||||||||||||||||||||||
Net income for common stock | $ | ( | $ |
(in thousands) | Hawaiian Electric | Hawaii Electric Light | Maui Electric | Other subsidiary | Consolidating adjustments | Hawaiian Electric Consolidated | ||||||||||||||||||||||||||||||||
Net income for common stock | $ | ( | $ | |||||||||||||||||||||||||||||||||||
Other comprehensive loss, net of taxes: | ||||||||||||||||||||||||||||||||||||||
Retirement benefit plans: | ||||||||||||||||||||||||||||||||||||||
Adjustment for amortization of prior service credit and net gains recognized during the period in net periodic benefit cost, net of taxes | ( | ( | ( | ( | ||||||||||||||||||||||||||||||||||
Reclassification adjustment for impact of D&Os of the PUC included in regulatory assets, net of taxes | ( | |||||||||||||||||||||||||||||||||||||
Other comprehensive loss, net of taxes | ( | ( | ( | ( | ||||||||||||||||||||||||||||||||||
Comprehensive income attributable to common shareholder | $ | ( | $ |
(in thousands) | Hawaiian Electric | Hawaii Electric Light | Maui Electric | Other subsidiaries | Consolidating adjustments | Hawaiian Electric Consolidated | ||||||||||||||||||||||||||||||||
Revenues | $ | $ | ||||||||||||||||||||||||||||||||||||
Expenses | ||||||||||||||||||||||||||||||||||||||
Fuel oil | ||||||||||||||||||||||||||||||||||||||
Purchased power | ||||||||||||||||||||||||||||||||||||||
Other operation and maintenance | ||||||||||||||||||||||||||||||||||||||
Wildfire tort-related claims (Note 2) | ||||||||||||||||||||||||||||||||||||||
Depreciation | ||||||||||||||||||||||||||||||||||||||
Taxes, other than income taxes | ||||||||||||||||||||||||||||||||||||||
Total expenses | ||||||||||||||||||||||||||||||||||||||
Operating loss | ( | ( | ( | ( | ||||||||||||||||||||||||||||||||||
Allowance for equity funds used during construction | ||||||||||||||||||||||||||||||||||||||
Equity in earnings of subsidiaries | ( | |||||||||||||||||||||||||||||||||||||
Retirement defined benefits credit (expense)—other than service costs | ( | |||||||||||||||||||||||||||||||||||||
Interest expense and other charges, net | ( | ( | ( | ( | ||||||||||||||||||||||||||||||||||
Allowance for borrowed funds used during construction | ||||||||||||||||||||||||||||||||||||||
Interest Income | ( | |||||||||||||||||||||||||||||||||||||
Loss before income taxes | ( | ( | ( | ( | ||||||||||||||||||||||||||||||||||
Income tax benefit | ( | ( | ( | ( | ||||||||||||||||||||||||||||||||||
Net loss | ( | ( | ( | ( | ||||||||||||||||||||||||||||||||||
Preferred stock dividends of subsidiaries | ||||||||||||||||||||||||||||||||||||||
Net loss attributable to Hawaiian Electric | ( | ( | ( | ( | ||||||||||||||||||||||||||||||||||
Preferred stock dividends of Hawaiian Electric | ||||||||||||||||||||||||||||||||||||||
Net loss for common stock | $ | ( | ( | ( | $ | ( |
(in thousands) | Hawaiian Electric | Hawaii Electric Light | Maui Electric | Other subsidiaries | Consolidating adjustments | Hawaiian Electric Consolidated | ||||||||||||||||||||||||||||||||
Net loss for common stock | $ | ( | ( | ( | $ | ( | ||||||||||||||||||||||||||||||||
Other comprehensive loss, net of taxes: | ||||||||||||||||||||||||||||||||||||||
Retirement benefit plans: | ||||||||||||||||||||||||||||||||||||||
Adjustment for amortization of net gains recognized during the period in net periodic benefit cost, net of taxes | ( | ( | ( | ( | ||||||||||||||||||||||||||||||||||
Reclassification adjustment for impact of D&Os of the PUC included in regulatory assets, net of taxes | ( | |||||||||||||||||||||||||||||||||||||
Other comprehensive loss, net of taxes | ( | ( | ( | ( | ||||||||||||||||||||||||||||||||||
Comprehensive loss attributable to common shareholder | $ | ( | ( | ( | $ | ( |
(in thousands) | Hawaiian Electric | Hawaii Electric Light | Maui Electric | Other subsidiary | Consolidating adjustments | Hawaiian Electric Consolidated | ||||||||||||||||||||||||||||||||
Revenues | $ | ( | $ | |||||||||||||||||||||||||||||||||||
Expenses | ||||||||||||||||||||||||||||||||||||||
Fuel oil | ||||||||||||||||||||||||||||||||||||||
Purchased power | ||||||||||||||||||||||||||||||||||||||
Other operation and maintenance | ||||||||||||||||||||||||||||||||||||||
Depreciation | ||||||||||||||||||||||||||||||||||||||
Taxes, other than income taxes | ||||||||||||||||||||||||||||||||||||||
Total expenses | ||||||||||||||||||||||||||||||||||||||
Operating income | ( | |||||||||||||||||||||||||||||||||||||
Allowance for equity funds used during construction | ||||||||||||||||||||||||||||||||||||||
Equity in earnings of subsidiaries | ( | |||||||||||||||||||||||||||||||||||||
Retirement defined benefits credit (expense)—other than service costs | ( | |||||||||||||||||||||||||||||||||||||
Interest expense and other charges, net | ( | ( | ( | ( | ||||||||||||||||||||||||||||||||||
Allowance for borrowed funds used during construction | ||||||||||||||||||||||||||||||||||||||
Income before income taxes | ( | |||||||||||||||||||||||||||||||||||||
Income taxes | ||||||||||||||||||||||||||||||||||||||
Net income | ( | |||||||||||||||||||||||||||||||||||||
Preferred stock dividends of subsidiaries | ||||||||||||||||||||||||||||||||||||||
Net income attributable to Hawaiian Electric | ( | |||||||||||||||||||||||||||||||||||||
Preferred stock dividends of Hawaiian Electric | ||||||||||||||||||||||||||||||||||||||
Net income for common stock | $ | ( | $ |
(in thousands) | Hawaiian Electric | Hawaii Electric Light | Maui Electric | Other subsidiary | Consolidating adjustments | Hawaiian Electric Consolidated | ||||||||||||||||||||||||||||||||
Net income for common stock | $ | ( | $ | |||||||||||||||||||||||||||||||||||
Other comprehensive loss, net of taxes: | ||||||||||||||||||||||||||||||||||||||
Retirement benefit plans: | ||||||||||||||||||||||||||||||||||||||
Adjustment for amortization of prior service credit and net gains recognized during the period in net periodic benefit cost, net of taxes | ( | ( | ( | ( | ||||||||||||||||||||||||||||||||||
Reclassification adjustment for impact of D&Os of the PUC included in regulatory assets, net of taxes | ( | |||||||||||||||||||||||||||||||||||||
Other comprehensive loss, net of taxes | ( | ( | ( | ( | ||||||||||||||||||||||||||||||||||
Comprehensive income attributable to common shareholder | $ | ( | $ |
(in thousands) | Hawaiian Electric | Hawaii Electric Light | Maui Electric | Other subsi- diaries | Consoli- dating adjustments | Hawaiian Electric Consolidated | ||||||||||||||||||||||||||||||||
Assets | ||||||||||||||||||||||||||||||||||||||
Property, plant and equipment | ||||||||||||||||||||||||||||||||||||||
Utility property, plant and equipment | ||||||||||||||||||||||||||||||||||||||
Land | $ | $ | ||||||||||||||||||||||||||||||||||||
Plant and equipment | ||||||||||||||||||||||||||||||||||||||
Right-of-use assets - finance lease | ||||||||||||||||||||||||||||||||||||||
Less accumulated depreciation | ( | ( | ( | ( | ||||||||||||||||||||||||||||||||||
Construction in progress | ||||||||||||||||||||||||||||||||||||||
Utility property, plant and equipment, net | ||||||||||||||||||||||||||||||||||||||
Nonutility property, plant and equipment, less accumulated depreciation | ||||||||||||||||||||||||||||||||||||||
Total property, plant and equipment, net | ||||||||||||||||||||||||||||||||||||||
Investment in wholly owned subsidiaries, at equity | ( | |||||||||||||||||||||||||||||||||||||
Current assets | ||||||||||||||||||||||||||||||||||||||
Cash and cash equivalents | ||||||||||||||||||||||||||||||||||||||
Restricted cash | ||||||||||||||||||||||||||||||||||||||
Advances to affiliates | ( | |||||||||||||||||||||||||||||||||||||
Customer accounts receivable, net | ||||||||||||||||||||||||||||||||||||||
Accrued unbilled revenues, net | ||||||||||||||||||||||||||||||||||||||
Other accounts receivable, net | ( | |||||||||||||||||||||||||||||||||||||
Fuel oil stock, at average cost | ||||||||||||||||||||||||||||||||||||||
Materials and supplies, at average cost | ||||||||||||||||||||||||||||||||||||||
Prepayments and other | ( | |||||||||||||||||||||||||||||||||||||
Regulatory assets | ||||||||||||||||||||||||||||||||||||||
Total current assets | ( | |||||||||||||||||||||||||||||||||||||
Other long-term assets | ||||||||||||||||||||||||||||||||||||||
Operating lease right-of-use assets | ||||||||||||||||||||||||||||||||||||||
Regulatory assets | ||||||||||||||||||||||||||||||||||||||
Other | ( | |||||||||||||||||||||||||||||||||||||
Total other long-term assets | ( | |||||||||||||||||||||||||||||||||||||
Total assets | $ | ( | $ | |||||||||||||||||||||||||||||||||||
(in thousands) | Hawaiian Electric | Hawaii Electric Light | Maui Electric | Other subsi- diaries | Consoli- dating adjustments | Hawaiian Electric Consolidated | ||||||||||||||||||||||||||||||||
Capitalization and liabilities | ||||||||||||||||||||||||||||||||||||||
Capitalization | ||||||||||||||||||||||||||||||||||||||
Common stock equity | $ | ( | $ | |||||||||||||||||||||||||||||||||||
Cumulative preferred stock—not subject to mandatory redemption | ||||||||||||||||||||||||||||||||||||||
Long-term debt, net | ||||||||||||||||||||||||||||||||||||||
Total capitalization | ( | |||||||||||||||||||||||||||||||||||||
Current liabilities | ||||||||||||||||||||||||||||||||||||||
Current portion of operating lease liabilities | ||||||||||||||||||||||||||||||||||||||
Current portion of long-term debt | ||||||||||||||||||||||||||||||||||||||
Short-term borrowings from affiliate | ( | |||||||||||||||||||||||||||||||||||||
Accounts payable | ||||||||||||||||||||||||||||||||||||||
Interest and preferred dividends payable | ( | |||||||||||||||||||||||||||||||||||||
Taxes accrued, including revenue taxes | ( | |||||||||||||||||||||||||||||||||||||
Regulatory liabilities | ||||||||||||||||||||||||||||||||||||||
Wildfire tort-related claims (Note 2) | ||||||||||||||||||||||||||||||||||||||
Other | ( | |||||||||||||||||||||||||||||||||||||
Total current liabilities | ( | |||||||||||||||||||||||||||||||||||||
Deferred credits and other liabilities | ||||||||||||||||||||||||||||||||||||||
Operating lease liabilities | ||||||||||||||||||||||||||||||||||||||
Finance lease liabilities | ||||||||||||||||||||||||||||||||||||||
Deferred income taxes | ( | |||||||||||||||||||||||||||||||||||||
Regulatory liabilities | ||||||||||||||||||||||||||||||||||||||
Unamortized tax credits | ||||||||||||||||||||||||||||||||||||||
Defined benefit pension and other postretirement benefit plans liability | ( | |||||||||||||||||||||||||||||||||||||
Other | ||||||||||||||||||||||||||||||||||||||
Total deferred credits and other liabilities | ( | |||||||||||||||||||||||||||||||||||||
Total capitalization and liabilities | $ | ( | $ |
(in thousands) | Hawaiian Electric | Hawaii Electric Light | Maui Electric | Other subsi-diary | Consoli- dating adjustments | Hawaiian Electric Consolidated | ||||||||||||||||||||||||||||||||
Assets | ||||||||||||||||||||||||||||||||||||||
Property, plant and equipment | ||||||||||||||||||||||||||||||||||||||
Utility property, plant and equipment | ||||||||||||||||||||||||||||||||||||||
Land | $ | $ | ||||||||||||||||||||||||||||||||||||
Plant and equipment | ||||||||||||||||||||||||||||||||||||||
Finance lease right-of-use assets | ||||||||||||||||||||||||||||||||||||||
Less accumulated depreciation | ( | ( | ( | ( | ||||||||||||||||||||||||||||||||||
Construction in progress | ||||||||||||||||||||||||||||||||||||||
Utility property, plant and equipment, net | ||||||||||||||||||||||||||||||||||||||
Nonutility property, plant and equipment, less accumulated depreciation | ||||||||||||||||||||||||||||||||||||||
Total property, plant and equipment, net | ||||||||||||||||||||||||||||||||||||||
Investment in wholly owned subsidiaries, at equity | ( | |||||||||||||||||||||||||||||||||||||
Current assets | ||||||||||||||||||||||||||||||||||||||
Cash and cash equivalents | ||||||||||||||||||||||||||||||||||||||
Restricted cash | ||||||||||||||||||||||||||||||||||||||
Advances to affiliates | ( | |||||||||||||||||||||||||||||||||||||
Customer accounts receivable, net | ||||||||||||||||||||||||||||||||||||||
Accrued unbilled revenues, net | ||||||||||||||||||||||||||||||||||||||
Other accounts receivable, net | ( | |||||||||||||||||||||||||||||||||||||
Fuel oil stock, at average cost | ||||||||||||||||||||||||||||||||||||||
Materials and supplies, at average cost | ||||||||||||||||||||||||||||||||||||||
Prepayments and other | ( | |||||||||||||||||||||||||||||||||||||
Regulatory assets | ||||||||||||||||||||||||||||||||||||||
Total current assets | ( | |||||||||||||||||||||||||||||||||||||
Other long-term assets | ||||||||||||||||||||||||||||||||||||||
Operating lease right-of-use assets | ||||||||||||||||||||||||||||||||||||||
Regulatory assets | ||||||||||||||||||||||||||||||||||||||
Other | ( | |||||||||||||||||||||||||||||||||||||
Total other long-term assets | ( | |||||||||||||||||||||||||||||||||||||
Total assets | $ | ( | $ | |||||||||||||||||||||||||||||||||||
(in thousands) | Hawaiian Electric | Hawaii Electric Light | Maui Electric | Other subsi-diary | Consoli- dating adjustments | Hawaiian Electric Consolidated | ||||||||||||||||||||||||||||||||
Capitalization and liabilities | ||||||||||||||||||||||||||||||||||||||
Capitalization | ||||||||||||||||||||||||||||||||||||||
Common stock equity | $ | ( | $ | |||||||||||||||||||||||||||||||||||
Cumulative preferred stock—not subject to mandatory redemption | ||||||||||||||||||||||||||||||||||||||
Long-term debt, net | ||||||||||||||||||||||||||||||||||||||
Total capitalization | ( | |||||||||||||||||||||||||||||||||||||
Current liabilities | ||||||||||||||||||||||||||||||||||||||
Current portion of operating lease liabilities | ||||||||||||||||||||||||||||||||||||||
Short-term borrowings-affiliate | ( | |||||||||||||||||||||||||||||||||||||
Accounts payable | ||||||||||||||||||||||||||||||||||||||
Interest and preferred dividends payable | ( | |||||||||||||||||||||||||||||||||||||
Taxes accrued, including revenue taxes | ( | |||||||||||||||||||||||||||||||||||||
Regulatory liabilities | ||||||||||||||||||||||||||||||||||||||
Wildfire tort-related claims | ||||||||||||||||||||||||||||||||||||||
Other | ( | |||||||||||||||||||||||||||||||||||||
Total current liabilities | ( | |||||||||||||||||||||||||||||||||||||
Deferred credits and other liabilities | ||||||||||||||||||||||||||||||||||||||
Operating lease liabilities | ||||||||||||||||||||||||||||||||||||||
Finance lease liabilities | ||||||||||||||||||||||||||||||||||||||
Deferred income taxes | ||||||||||||||||||||||||||||||||||||||
Regulatory liabilities | ||||||||||||||||||||||||||||||||||||||
Unamortized tax credits | ||||||||||||||||||||||||||||||||||||||
Defined benefit pension and other postretirement benefit plans liability | ( | |||||||||||||||||||||||||||||||||||||
Other | ||||||||||||||||||||||||||||||||||||||
Total deferred credits and other liabilities | ( | |||||||||||||||||||||||||||||||||||||
Total capitalization and liabilities | $ | ( | $ |
(in thousands) | Hawaiian Electric | Hawaii Electric Light | Maui Electric | Other subsidiaries | Consolidating adjustments | Hawaiian Electric Consolidated | ||||||||||||||||||||||||||||||||
Balance, December 31, 2023 | $ | ( | $ | |||||||||||||||||||||||||||||||||||
Net loss for common stock | ( | ( | ( | — | ( | |||||||||||||||||||||||||||||||||
Other comprehensive loss, net of taxes | ( | ( | ( | — | ( | |||||||||||||||||||||||||||||||||
Common stock dividends | ( | — | — | — | — | ( | ||||||||||||||||||||||||||||||||
Balance, June 30, 2024 | $ | ( | $ |
(in thousands) | Hawaiian Electric | Hawaii Electric Light | Maui Electric | Other subsidiary | Consolidating adjustments | Hawaiian Electric Consolidated | ||||||||||||||||||||||||||||||||
Balance, December 31, 2022 | $ | ( | $ | |||||||||||||||||||||||||||||||||||
Net income for common stock | — | ( | ||||||||||||||||||||||||||||||||||||
Other comprehensive loss, net of taxes | ( | ( | ( | — | ( | |||||||||||||||||||||||||||||||||
Common stock dividends | ( | ( | ( | — | ( | |||||||||||||||||||||||||||||||||
Balance, June 30, 2023 | $ | ( | $ |
(in thousands) | Hawaiian Electric | Hawaii Electric Light | Maui Electric | Other subsidiaries | Consolidating adjustments | Hawaiian Electric Consolidated | ||||||||||||||||||||||||||||||||
Net cash provided by operating activities | $ | ( | $ | |||||||||||||||||||||||||||||||||||
Cash flows from investing activities | ||||||||||||||||||||||||||||||||||||||
Capital expenditures | ( | ( | ( | ( | ||||||||||||||||||||||||||||||||||
Advances to affiliates | ( | |||||||||||||||||||||||||||||||||||||
Other | ( | |||||||||||||||||||||||||||||||||||||
Net cash used in investing activities | ( | ( | ( | ( | ||||||||||||||||||||||||||||||||||
Cash flows from financing activities | ||||||||||||||||||||||||||||||||||||||
Common stock dividends | ( | ( | ||||||||||||||||||||||||||||||||||||
Preferred stock dividends of Hawaiian Electric and subsidiaries | ( | ( | ||||||||||||||||||||||||||||||||||||
Net increase in short-term borrowings from non-affiliates and affiliate with original maturities of three months or less | ( | |||||||||||||||||||||||||||||||||||||
Payments of obligations under finance leases | ( | ( | ( | ( | ||||||||||||||||||||||||||||||||||
Other | ( | ( | ( | ( | ||||||||||||||||||||||||||||||||||
Net cash provided by (used in) financing activities | ( | ( | ( | ( | ||||||||||||||||||||||||||||||||||
Net increase (decrease) in cash, cash equivalents and restricted cash | ( | ( | ||||||||||||||||||||||||||||||||||||
Cash, cash equivalents and restricted cash, beginning of period | ||||||||||||||||||||||||||||||||||||||
Cash, cash equivalents and restricted cash, end of period | ||||||||||||||||||||||||||||||||||||||
Less: Restricted cash | ( | ( | ||||||||||||||||||||||||||||||||||||
Cash and cash equivalents, end of period | $ | $ |
(in thousands) | Hawaiian Electric | Hawaii Electric Light | Maui Electric | Other subsidiary | Consolidating adjustments | Hawaiian Electric Consolidated | ||||||||||||||||||||||||||||||||
Net cash provided by operating activities | $ | ( | $ | |||||||||||||||||||||||||||||||||||
Cash flows from investing activities | ||||||||||||||||||||||||||||||||||||||
Capital expenditures | ( | ( | ( | ( | ||||||||||||||||||||||||||||||||||
Advances to affiliates | ( | |||||||||||||||||||||||||||||||||||||
Other | ||||||||||||||||||||||||||||||||||||||
Net cash used in investing activities | ( | ( | ( | ( | ( | |||||||||||||||||||||||||||||||||
Cash flows from financing activities | ||||||||||||||||||||||||||||||||||||||
Common stock dividends | ( | ( | ( | ( | ||||||||||||||||||||||||||||||||||
Preferred stock dividends of Hawaiian Electric and subsidiaries | ( | ( | ( | ( | ||||||||||||||||||||||||||||||||||
Proceeds from issuance of long-term debt | ||||||||||||||||||||||||||||||||||||||
Net decrease in short-term borrowings from non-affiliates and affiliate with original maturities of three months or less | ( | ( | ||||||||||||||||||||||||||||||||||||
Payments of obligations under finance leases | ( | ( | ( | |||||||||||||||||||||||||||||||||||
Other | ( | ( | ( | ( | ||||||||||||||||||||||||||||||||||
Net cash provided by (used in) financing activities | ( | ( | ||||||||||||||||||||||||||||||||||||
Net increase in cash and cash equivalents | ||||||||||||||||||||||||||||||||||||||
Cash and cash equivalents, beginning of period | ||||||||||||||||||||||||||||||||||||||
Cash and cash equivalents, end of period | $ | $ |
Three months ended June 30 | Six months ended June 30 | |||||||||||||||||||||||||
(in thousands) | 2024 | 2023 | 2024 | 2023 | ||||||||||||||||||||||
Interest and dividend income | ||||||||||||||||||||||||||
Interest and fees on loans | $ | $ | $ | $ | ||||||||||||||||||||||
Interest and dividends on investment securities | ||||||||||||||||||||||||||
Total interest and dividend income | ||||||||||||||||||||||||||
Interest expense | ||||||||||||||||||||||||||
Interest on deposit liabilities | ||||||||||||||||||||||||||
Interest on other borrowings | ||||||||||||||||||||||||||
Total interest expense | ||||||||||||||||||||||||||
Net interest income | ||||||||||||||||||||||||||
Provision for credit losses | ( | ( | ||||||||||||||||||||||||
Net interest income after provision for credit losses | ||||||||||||||||||||||||||
Noninterest income | ||||||||||||||||||||||||||
Fees from other financial services | ||||||||||||||||||||||||||
Fee income on deposit liabilities | ||||||||||||||||||||||||||
Fee income on other financial products | ||||||||||||||||||||||||||
Bank-owned life insurance | ||||||||||||||||||||||||||
Mortgage banking income | ||||||||||||||||||||||||||
Gain on sale of real estate | ||||||||||||||||||||||||||
Other income, net | ||||||||||||||||||||||||||
Total noninterest income | ||||||||||||||||||||||||||
Noninterest expense | ||||||||||||||||||||||||||
Compensation and employee benefits | ||||||||||||||||||||||||||
Occupancy | ||||||||||||||||||||||||||
Data processing | ||||||||||||||||||||||||||
Services | ||||||||||||||||||||||||||
Equipment | ||||||||||||||||||||||||||
Office supplies, printing and postage | ||||||||||||||||||||||||||
Marketing | ||||||||||||||||||||||||||
Goodwill impairment | ||||||||||||||||||||||||||
Other expense | ||||||||||||||||||||||||||
Total noninterest expense | ||||||||||||||||||||||||||
Income (loss) before income taxes | ( | ( | ||||||||||||||||||||||||
Income tax (benefit) | ( | ( | ||||||||||||||||||||||||
Net income (loss) | ( | ( | ||||||||||||||||||||||||
Other comprehensive income (loss), net of taxes | ( | ( | ||||||||||||||||||||||||
Comprehensive income (loss) | $ | ( | $ | $ | ( | $ |
Three months ended June 30 | Six months ended June 30 | |||||||||||||||||||||||||
(in thousands) | 2024 | 2023 | 2024 | 2023 | ||||||||||||||||||||||
Interest and dividend income | $ | $ | $ | $ | ||||||||||||||||||||||
Noninterest income | ||||||||||||||||||||||||||
Less: Gain on sale of real estate | ||||||||||||||||||||||||||
*Revenues-Bank | ||||||||||||||||||||||||||
Total interest expense | ||||||||||||||||||||||||||
Provision for credit losses | ( | ( | ||||||||||||||||||||||||
Noninterest expense | ||||||||||||||||||||||||||
Less: Gain on sale of real estate | ||||||||||||||||||||||||||
Less: Retirement defined benefits credit—other than service costs | ( | ( | ( | ( | ||||||||||||||||||||||
*Expenses-Bank | ||||||||||||||||||||||||||
*Operating income (loss)-Bank | ( | ( | ||||||||||||||||||||||||
Add back: Retirement defined benefits credit—other than service costs | ( | ( | ( | ( | ||||||||||||||||||||||
Income (loss) before income taxes | $ | ( | $ | $ | ( | $ |
(in thousands) | June 30, 2024 | December 31, 2023 | ||||||||||||||||||||||||
Assets | ||||||||||||||||||||||||||
Cash and due from banks | $ | $ | ||||||||||||||||||||||||
Interest-bearing deposits | ||||||||||||||||||||||||||
Cash and cash equivalents | ||||||||||||||||||||||||||
Investment securities | ||||||||||||||||||||||||||
Available-for-sale, at fair value | ||||||||||||||||||||||||||
Held-to-maturity, at amortized cost (fair value of $ | ||||||||||||||||||||||||||
Stock in Federal Home Loan Bank, at cost | ||||||||||||||||||||||||||
Loans held for investment | ||||||||||||||||||||||||||
Allowance for credit losses | ( | ( | ||||||||||||||||||||||||
Net loans | ||||||||||||||||||||||||||
Loans held for sale, at lower of cost or fair value | ||||||||||||||||||||||||||
Other | ||||||||||||||||||||||||||
Goodwill | ||||||||||||||||||||||||||
Total assets | $ | $ | ||||||||||||||||||||||||
Liabilities and shareholder’s equity | ||||||||||||||||||||||||||
Deposit liabilities—noninterest-bearing | $ | $ | ||||||||||||||||||||||||
Deposit liabilities—interest-bearing | ||||||||||||||||||||||||||
Other borrowings | ||||||||||||||||||||||||||
Other | ||||||||||||||||||||||||||
Total liabilities | ||||||||||||||||||||||||||
Common stock | ||||||||||||||||||||||||||
Additional paid-in capital | ||||||||||||||||||||||||||
Retained earnings | ||||||||||||||||||||||||||
Accumulated other comprehensive loss, net of tax benefits | ||||||||||||||||||||||||||
Net unrealized losses on securities | $ | ( | $ | ( | ||||||||||||||||||||||
Retirement benefit plans | ( | ( | ( | ( | ||||||||||||||||||||||
Total shareholder’s equity | ||||||||||||||||||||||||||
Total liabilities and shareholder’s equity | $ | $ | ||||||||||||||||||||||||
Other assets | ||||||||||||||||||||||||||
Bank-owned life insurance | $ | $ | ||||||||||||||||||||||||
Premises and equipment, net | ||||||||||||||||||||||||||
Accrued interest receivable | ||||||||||||||||||||||||||
Mortgage-servicing rights | ||||||||||||||||||||||||||
Low-income housing investments | ||||||||||||||||||||||||||
Deferred tax asset | ||||||||||||||||||||||||||
Other | ||||||||||||||||||||||||||
Total other assets | $ | $ | ||||||||||||||||||||||||
Other liabilities | ||||||||||||||||||||||||||
Accrued expenses | $ | $ | ||||||||||||||||||||||||
Cashier’s checks | ||||||||||||||||||||||||||
Advance payments by borrowers | ||||||||||||||||||||||||||
Other | ||||||||||||||||||||||||||
Total other liabilities | $ | $ |
Amortized cost | Gross unrealized gains | Gross unrealized losses | Estimated fair value | Gross unrealized losses | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Less than 12 months | 12 months or longer | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
(dollars in thousands) | Number of issues | Fair value | Amount | Number of issues | Fair value | Amount | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||
June 30, 2024 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Available-for-sale | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
U.S. Treasury and federal agency obligations | $ | $ | $ | ( | $ | $ | $ | $ | $ | ( | ||||||||||||||||||||||||||||||||||||||||||||||||||||
Mortgage-backed securities* | ( | ( | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Corporate bonds | ( | ( | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Mortgage revenue bonds | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
$ | $ | $ | ( | $ | $ | $ | $ | $ | ( | |||||||||||||||||||||||||||||||||||||||||||||||||||||
Held-to-maturity | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
U.S. Treasury and federal agency obligations | $ | $ | $ | ( | $ | $ | $ | $ | $ | ( | ||||||||||||||||||||||||||||||||||||||||||||||||||||
Mortgage-backed securities* | ( | ( | ( | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
$ | $ | $ | ( | $ | $ | $ | ( | $ | $ | ( | ||||||||||||||||||||||||||||||||||||||||||||||||||||
December 31, 2023 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Available-for-sale | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
U.S. Treasury and federal agency obligations | $ | $ | $ | ( | $ | $ | $ | $ | $ | ( | ||||||||||||||||||||||||||||||||||||||||||||||||||||
Mortgage-backed securities* | ( | ( | ( | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Corporate bonds | ( | ( | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Mortgage revenue bonds | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
$ | $ | $ | ( | $ | $ | $ | ( | $ | $ | ( | ||||||||||||||||||||||||||||||||||||||||||||||||||||
Held-to-maturity | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
U.S. Treasury and federal agency obligations | $ | $ | $ | ( | $ | $ | $ | $ | $ | ( | ||||||||||||||||||||||||||||||||||||||||||||||||||||
Mortgage-backed securities* | ( | ( | ( | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
$ | $ | $ | ( | $ | $ | $ | ( | $ | $ | ( |
June 30, 2024 | Amortized cost | Fair value | ||||||||||||
(in thousands) | ||||||||||||||
Available-for-sale | ||||||||||||||
Due in one year or less | $ | $ | ||||||||||||
Due after one year through five years | ||||||||||||||
Due after five years through ten years | ||||||||||||||
Due after ten years | ||||||||||||||
Mortgage-backed securities — issued or guaranteed by U.S. Government agencies or sponsored agencies | ||||||||||||||
Total available-for-sale securities | $ | $ | ||||||||||||
Held-to-maturity | ||||||||||||||
Due in one year or less | $ | $ | ||||||||||||
Due after one year through five years | ||||||||||||||
Due after five years through ten years | ||||||||||||||
Due after ten years | ||||||||||||||
Mortgage-backed securities — issued or guaranteed by U.S. Government agencies or sponsored agencies | ||||||||||||||
Total held-to-maturity securities | $ | $ |
June 30, 2024 | December 31, 2023 | ||||||||||
(in thousands) | |||||||||||
Real estate: | |||||||||||
Residential 1-4 family | $ | $ | |||||||||
Commercial real estate | |||||||||||
Home equity line of credit | |||||||||||
Residential land | |||||||||||
Commercial construction | |||||||||||
Residential construction | |||||||||||
Total real estate | |||||||||||
Commercial | |||||||||||
Consumer | |||||||||||
Total loans | |||||||||||
Less: Deferred fees and discounts | ( | ( | |||||||||
Allowance for credit losses | ( | ( | |||||||||
Total loans, net | $ | $ |
(in thousands) | Residential 1-4 family | Commercial real estate | Home equity line of credit | Residential land | Commercial construction | Residential construction | Commercial loans | Consumer loans | Total | |||||||||||||||||||||||||||||||||||||||||||||||
Three months ended June 30, 2024 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Allowance for credit losses: | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Beginning balance | $ | $ | $ | $ | $ | $ | $ | $ | $ | |||||||||||||||||||||||||||||||||||||||||||||||
Charge-offs | ( | ( | ( | |||||||||||||||||||||||||||||||||||||||||||||||||||||
Recoveries | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Provision | ( | ( | ( | ( | ( | ( | ( | |||||||||||||||||||||||||||||||||||||||||||||||||
Ending balance | $ | $ | $ | $ | $ | $ | $ | $ | $ | |||||||||||||||||||||||||||||||||||||||||||||||
Three months ended June 30, 2023 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Allowance for credit losses: | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Beginning balance | $ | $ | $ | $ | $ | $ | $ | $ | $ | |||||||||||||||||||||||||||||||||||||||||||||||
Charge-offs | ( | ( | ( | ( | ( | |||||||||||||||||||||||||||||||||||||||||||||||||||
Recoveries | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Provision | ( | ( | ( | ( | ( | |||||||||||||||||||||||||||||||||||||||||||||||||||
Ending balance | $ | $ | $ | $ | $ | $ | $ | $ | $ | |||||||||||||||||||||||||||||||||||||||||||||||
Six months ended June 30, 2024 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Allowance for credit losses: | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Beginning balance | $ | $ | $ | $ | $ | $ | $ | $ | $ | |||||||||||||||||||||||||||||||||||||||||||||||
Charge-offs | ( | ( | ( | ( | ||||||||||||||||||||||||||||||||||||||||||||||||||||
Recoveries | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Provision | ( | ( | ( | ( | ( | ( | ||||||||||||||||||||||||||||||||||||||||||||||||||
Ending balance | $ | $ | $ | $ | $ | $ | $ | $ | $ | |||||||||||||||||||||||||||||||||||||||||||||||
Six months ended June 30, 2023 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Allowance for credit losses: | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Beginning balance | $ | $ | $ | $ | $ | $ | $ | $ | $ | |||||||||||||||||||||||||||||||||||||||||||||||
Charge-offs | ( | ( | ( | ( | ( | |||||||||||||||||||||||||||||||||||||||||||||||||||
Recoveries | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Provision | ( | ( | ( | ( | ( | |||||||||||||||||||||||||||||||||||||||||||||||||||
Ending balance | $ | $ | $ | $ | $ | $ | $ | $ | $ |
(in thousands) | Home equity line of credit | Commercial construction | Commercial loans | Total | ||||||||||||||||||||||
Three months ended June 30, 2024 | ||||||||||||||||||||||||||
Allowance for loan commitments: | ||||||||||||||||||||||||||
Beginning balance | $ | $ | $ | $ | ||||||||||||||||||||||
Provision | ||||||||||||||||||||||||||
Ending balance | $ | $ | $ | $ | ||||||||||||||||||||||
Three months ended June 30, 2023 | ||||||||||||||||||||||||||
Allowance for loan commitments: | ||||||||||||||||||||||||||
Beginning balance | $ | $ | $ | $ | ||||||||||||||||||||||
Provision | ( | |||||||||||||||||||||||||
Ending balance | $ | $ | $ | $ | ||||||||||||||||||||||
Six months ended June 30, 2024 | ||||||||||||||||||||||||||
Allowance for loan commitments: | ||||||||||||||||||||||||||
Beginning balance | $ | $ | $ | $ | ||||||||||||||||||||||
Provision | ( | ( | ||||||||||||||||||||||||
Ending balance | $ | $ | $ | $ | ||||||||||||||||||||||
Six months ended June 30, 2023 | ||||||||||||||||||||||||||
Allowance for loan commitments: | ||||||||||||||||||||||||||
Beginning balance | $ | $ | $ | $ | ||||||||||||||||||||||
Provision | ( | |||||||||||||||||||||||||
Ending balance | $ | $ | $ | $ |
Term Loans by Origination Year | Revolving Loans | |||||||||||||||||||||||||||||||||||||||||||||||||||||||
(in thousands) | 2024 | 2023 | 2022 | 2021 | 2020 | Prior | Revolving | Converted to term loans | Total | |||||||||||||||||||||||||||||||||||||||||||||||
June 30, 2024 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Residential 1-4 family | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Current | $ | $ | $ | $ | $ | $ | $ | $ | $ | |||||||||||||||||||||||||||||||||||||||||||||||
30-59 days past due | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||
60-89 days past due | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Greater than 89 days past due | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Home equity line of credit | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Current | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||
30-59 days past due | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||
60-89 days past due | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Greater than 89 days past due | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Residential land | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Current | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||
30-59 days past due | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||
60-89 days past due | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Greater than 89 days past due | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Residential construction | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Current | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||
30-59 days past due | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||
60-89 days past due | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Greater than 89 days past due | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Consumer | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Current | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||
30-59 days past due | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||
60-89 days past due | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Greater than 89 days past due | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Commercial real estate | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Pass | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Special Mention | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Substandard | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Doubtful | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Commercial construction | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Pass | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Special Mention | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Substandard | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Doubtful | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Commercial | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Pass | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Special Mention | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Substandard | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Doubtful | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Total loans | $ | $ | $ | $ | $ | $ | $ | $ | $ |
Term Loans by Origination Year | Revolving Loans | |||||||||||||||||||||||||||||||||||||||||||||||||||||||
(in thousands) | 2023 | 2022 | 2021 | 2020 | 2019 | Prior | Revolving | Converted to term loans | Total | |||||||||||||||||||||||||||||||||||||||||||||||
December 31, 2023 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Residential 1-4 family | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Current | $ | $ | $ | $ | $ | $ | $ | $ | $ | |||||||||||||||||||||||||||||||||||||||||||||||
30-59 days past due | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||
60-89 days past due | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Greater than 89 days past due | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Home equity line of credit | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Current | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||
30-59 days past due | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||
60-89 days past due | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Greater than 89 days past due | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Residential land | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Current | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||
30-59 days past due | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||
60-89 days past due | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Greater than 89 days past due | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Residential construction | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Current | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||
30-59 days past due | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||
60-89 days past due | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Greater than 89 days past due | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Consumer | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Current | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||
30-59 days past due | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||
60-89 days past due | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Greater than 89 days past due | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Commercial real estate | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Pass | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Special Mention | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Substandard | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Doubtful | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Commercial construction | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Pass | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Special Mention | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Substandard | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Doubtful | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Commercial | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Pass | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Special Mention | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Substandard | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Doubtful | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Total loans | $ | $ | $ | $ | $ | $ | $ | $ | $ |
(in thousands) | 2024 | 2023 | 2022 | 2021 | 2020 | Prior | Total | |||||||||||||||||||||||||||||||||||||
Six months ended June 30, 2024 | ||||||||||||||||||||||||||||||||||||||||||||
Residential 1-4 family | $ | $ | $ | $ | $ | $ | $ | |||||||||||||||||||||||||||||||||||||
Commercial real estate | ||||||||||||||||||||||||||||||||||||||||||||
Home equity line of credit | ||||||||||||||||||||||||||||||||||||||||||||
Residential land | ||||||||||||||||||||||||||||||||||||||||||||
Commercial construction | ||||||||||||||||||||||||||||||||||||||||||||
Residential construction | ||||||||||||||||||||||||||||||||||||||||||||
Commercial | ||||||||||||||||||||||||||||||||||||||||||||
Consumer | ||||||||||||||||||||||||||||||||||||||||||||
Total | $ | $ | $ | $ | $ | $ | $ |
(in thousands) | 30-59 days past due | 60-89 days past due | 90 days or more past due | Total past due | Current | Total financing receivables | Amortized cost> 90 days and accruing | |||||||||||||||||||||||||||||||||||||
June 30, 2024 | ||||||||||||||||||||||||||||||||||||||||||||
Real estate: | ||||||||||||||||||||||||||||||||||||||||||||
Residential 1-4 family | $ | $ | $ | $ | $ | $ | $ | |||||||||||||||||||||||||||||||||||||
Commercial real estate | ||||||||||||||||||||||||||||||||||||||||||||
Home equity line of credit | ||||||||||||||||||||||||||||||||||||||||||||
Residential land | ||||||||||||||||||||||||||||||||||||||||||||
Commercial construction | ||||||||||||||||||||||||||||||||||||||||||||
Residential construction | ||||||||||||||||||||||||||||||||||||||||||||
Commercial | ||||||||||||||||||||||||||||||||||||||||||||
Consumer | ||||||||||||||||||||||||||||||||||||||||||||
Total loans | $ | $ | $ | $ | $ | $ | $ | |||||||||||||||||||||||||||||||||||||
December 31, 2023 | ||||||||||||||||||||||||||||||||||||||||||||
Real estate: | ||||||||||||||||||||||||||||||||||||||||||||
Residential 1-4 family | $ | $ | $ | $ | $ | $ | $ | |||||||||||||||||||||||||||||||||||||
Commercial real estate | ||||||||||||||||||||||||||||||||||||||||||||
Home equity line of credit | ||||||||||||||||||||||||||||||||||||||||||||
Residential land | ||||||||||||||||||||||||||||||||||||||||||||
Commercial construction | ||||||||||||||||||||||||||||||||||||||||||||
Residential construction | ||||||||||||||||||||||||||||||||||||||||||||
Commercial | ||||||||||||||||||||||||||||||||||||||||||||
Consumer | ||||||||||||||||||||||||||||||||||||||||||||
Total loans | $ | $ | $ | $ | $ | $ | $ |
(in thousands) | June 30, 2024 | December 31, 2023 | ||||||||||||||||||||||||||||||||||||
With a related ACL | Without a related ACL | Total | With a related ACL | Without a related ACL | Total | |||||||||||||||||||||||||||||||||
Real estate: | ||||||||||||||||||||||||||||||||||||||
Residential 1-4 family | $ | $ | $ | $ | $ | $ | ||||||||||||||||||||||||||||||||
Commercial real estate | ||||||||||||||||||||||||||||||||||||||
Home equity line of credit | ||||||||||||||||||||||||||||||||||||||
Residential land | ||||||||||||||||||||||||||||||||||||||
Commercial construction | ||||||||||||||||||||||||||||||||||||||
Residential construction | ||||||||||||||||||||||||||||||||||||||
Commercial | ||||||||||||||||||||||||||||||||||||||
Consumer | ||||||||||||||||||||||||||||||||||||||
Total | $ | $ | $ | $ | $ | $ | ||||||||||||||||||||||||||||||||
(in thousands) | Term extension | Payment delay | Combination payment delay & term extension | Total | % of total class of loans | |||||||||||||||||||||||||||
Three months ended June 30, 2024 | ||||||||||||||||||||||||||||||||
Real estate loans | ||||||||||||||||||||||||||||||||
Residential 1-4 family | $ | $ | $ | $ | % | |||||||||||||||||||||||||||
Commercial real estate | ||||||||||||||||||||||||||||||||
Home equity line of credit | ||||||||||||||||||||||||||||||||
Residential land | ||||||||||||||||||||||||||||||||
Commercial construction | ||||||||||||||||||||||||||||||||
Residential construction | ||||||||||||||||||||||||||||||||
Commercial | ||||||||||||||||||||||||||||||||
Consumer | ||||||||||||||||||||||||||||||||
Total | $ | $ | $ | $ | % | |||||||||||||||||||||||||||
Six months ended June 30, 2024 | ||||||||||||||||||||||||||||||||
Real estate loans | ||||||||||||||||||||||||||||||||
Residential 1-4 family | $ | $ | $ | $ | % | |||||||||||||||||||||||||||
Commercial real estate | % | |||||||||||||||||||||||||||||||
Home equity line of credit | % | |||||||||||||||||||||||||||||||
Residential land | % | |||||||||||||||||||||||||||||||
Commercial construction | ||||||||||||||||||||||||||||||||
Residential construction | ||||||||||||||||||||||||||||||||
Commercial | ||||||||||||||||||||||||||||||||
Consumer | ||||||||||||||||||||||||||||||||
Total | $ | $ | $ | $ | % |
Weighted average | ||||||||||||||
Term extension (in months) | Payment delay (in months) | |||||||||||||
Three months ended June 30, 2024 | ||||||||||||||
Real estate loans | ||||||||||||||
Residential 1-4 family | ||||||||||||||
Commercial real estate | — | — | ||||||||||||
Home equity line of credit | — | — | ||||||||||||
Residential land | — | — | ||||||||||||
Commercial construction | — | — | ||||||||||||
Residential construction | — | — | ||||||||||||
Commercial | — | — | ||||||||||||
Consumer | — | — | ||||||||||||
Six months ended June 30, 2024 | ||||||||||||||
Real estate loans | ||||||||||||||
Residential 1-4 family | ||||||||||||||
Commercial real estate | ||||||||||||||
Home equity line of credit | — | |||||||||||||
Residential land | — | |||||||||||||
Commercial construction | — | — | ||||||||||||
Residential construction | — | — | ||||||||||||
Commercial | — | — | ||||||||||||
Consumer | — | — |
(in thousands) | Current | 30-59 days past due | 60-89 days past due | 90 days or more past due | Total | |||||||||||||||||||||||||||
Real estate loans | ||||||||||||||||||||||||||||||||
Residential 1-4 family | $ | $ | $ | $ | $ | |||||||||||||||||||||||||||
Commercial real estate | ||||||||||||||||||||||||||||||||
Home equity line of credit | ||||||||||||||||||||||||||||||||
Residential land | ||||||||||||||||||||||||||||||||
Commercial construction | ||||||||||||||||||||||||||||||||
Residential construction | ||||||||||||||||||||||||||||||||
Commercial | ||||||||||||||||||||||||||||||||
Consumer | ||||||||||||||||||||||||||||||||
Total | $ | $ | $ | $ | $ |
Amortized cost | ||||||||||||||||||||
(in thousands) | June 30, 2024 | December 31, 2023 | Collateral type | |||||||||||||||||
Real estate: | ||||||||||||||||||||
Residential 1-4 family | $ | $ | Residential real estate property | |||||||||||||||||
Commercial real estate | Commercial real estate property | |||||||||||||||||||
Home equity line of credit | Residential real estate property | |||||||||||||||||||
Total real estate | ||||||||||||||||||||
Commercial | Business assets | |||||||||||||||||||
Total | $ | $ |
(in thousands) | Gross carrying amount | Accumulated amortization | Valuation allowance | Net carrying amount | ||||||||||||||||||||||
June 30, 2024 | $ | $ | ( | $ | $ | |||||||||||||||||||||
December 31, 2023 | ( |
Three months ended June 30 | Six months ended June 30 | |||||||||||||||||||||||||
(in thousands) | 2024 | 2023 | 2024 | 2023 | ||||||||||||||||||||||
Mortgage servicing rights | ||||||||||||||||||||||||||
Beginning balance | $ | $ | $ | $ | ||||||||||||||||||||||
Amount capitalized | ||||||||||||||||||||||||||
Amortization | ( | ( | ( | ( | ||||||||||||||||||||||
Other-than-temporary impairment | ||||||||||||||||||||||||||
Carrying amount before valuation allowance | ||||||||||||||||||||||||||
Valuation allowance for mortgage servicing rights | ||||||||||||||||||||||||||
Beginning balance | ||||||||||||||||||||||||||
Provision | ||||||||||||||||||||||||||
Other-than-temporary impairment | ||||||||||||||||||||||||||
Ending balance | ||||||||||||||||||||||||||
Net carrying value of mortgage servicing rights | $ | $ | $ | $ |
(dollars in thousands) | June 30, 2024 | December 31, 2023 | ||||||||||||
Unpaid principal balance | $ | $ | ||||||||||||
Weighted average note rate | % | % | ||||||||||||
Weighted average discount rate | % | % | ||||||||||||
Weighted average prepayment speed | % | % |
(dollars in thousands) | June 30, 2024 | December 31, 2023 | ||||||||||||
Prepayment rate: | ||||||||||||||
25 basis points adverse rate change | $ | ( | $ | ( | ||||||||||
50 basis points adverse rate change | ( | ( | ||||||||||||
Discount rate: | ||||||||||||||
25 basis points adverse rate change | ( | ( | ||||||||||||
50 basis points adverse rate change | ( | ( |
June 30, 2024 | December 31, 2023 | |||||||||||||||||||||||||
(in thousands) | Notional amount | Fair value | Notional amount | Fair value | ||||||||||||||||||||||
Interest rate lock commitments | $ | $ | $ | $ | ||||||||||||||||||||||
Forward commitments | ( |
Derivative Financial Instruments Not Designated as Hedging Instruments 1 | June 30, 2024 | December 31, 2023 | ||||||||||||||||||||||||
(in thousands) | Asset derivatives | Liability derivatives | Asset derivatives | Liability derivatives | ||||||||||||||||||||||
Interest rate lock commitments | $ | $ | $ | $ | ||||||||||||||||||||||
Forward commitments | ||||||||||||||||||||||||||
$ | $ | $ | $ |
Derivative Financial Instruments Not Designated as Hedging Instruments | Location of net gains (losses) recognized in the Statements of Income | Three months ended June 30 | Six months ended June 30 | |||||||||||||||||||||||||||||
(in thousands) | 2024 | 2023 | 2024 | 2023 | ||||||||||||||||||||||||||||
Interest rate lock commitments | Mortgage banking income | $ | ( | $ | $ | $ | ||||||||||||||||||||||||||
Forward commitments | ||||||||||||||||||||||||||||||||
$ | ( | $ | $ | $ |
HEI Consolidated | Hawaiian Electric Consolidated | ||||||||||||||||||||||||||||
(in thousands) | Net unrealized gains (losses) on securities | Unrealized gains (losses) on derivatives | Retirement benefit plans | AOCI | AOCI-Retirement benefit plans | ||||||||||||||||||||||||
Balance, December 31, 2023 | $ | ( | $ | $ | ( | $ | ( | $ | |||||||||||||||||||||
Current period other comprehensive income (loss) | ( | ( | ( | ||||||||||||||||||||||||||
Balance, June 30, 2024 | $ | ( | $ | $ | ( | $ | ( | $ | |||||||||||||||||||||
Balance, December 31, 2022 | $ | ( | $ | $ | ( | $ | ( | $ | |||||||||||||||||||||
Current period other comprehensive income (loss) | ( | ( | |||||||||||||||||||||||||||
Balance, June 30, 2023 | $ | ( | $ | $ | ( | $ | ( | $ |
Amount reclassified from AOCI | Affected line item in the Statements of Income / Balance Sheets | |||||||||||||||||||||||||||||||
Three months ended June 30 | Six months ended June 30 | |||||||||||||||||||||||||||||||
(in thousands) | 2024 | 2023 | 2024 | 2023 | ||||||||||||||||||||||||||||
HEI consolidated | ||||||||||||||||||||||||||||||||
Amortization of unrealized holding losses on held-to-maturity securities | $ | $ | $ | $ | Bank revenues | |||||||||||||||||||||||||||
Net realized gains on derivatives qualifying as cash flow hedges | ( | ( | ( | ( | Interest expense | |||||||||||||||||||||||||||
Retirement benefit plans: | ||||||||||||||||||||||||||||||||
Amortization of prior service credit and net gains recognized during the period in net periodic benefit cost | ( | ( | ( | ( | See Note 9 for additional details | |||||||||||||||||||||||||||
Impact of D&Os of the PUC included in regulatory assets | See Note 9 for additional details | |||||||||||||||||||||||||||||||
Total reclassifications | $ | $ | $ | $ | ||||||||||||||||||||||||||||
Hawaiian Electric consolidated | ||||||||||||||||||||||||||||||||
Retirement benefit plans: | ||||||||||||||||||||||||||||||||
Amortization of prior service credit and net gains recognized during the period in net periodic benefit cost | $ | ( | $ | ( | $ | ( | $ | ( | See Note 9 for additional details | |||||||||||||||||||||||
Impact of D&Os of the PUC included in regulatory assets | See Note 9 for additional details | |||||||||||||||||||||||||||||||
Total reclassifications | $ | ( | $ | ( | $ | ( | $ | ( |
Three months ended June 30, 2024 | Six months ended June 30, 2024 | |||||||||||||||||||||||||||||||||||||||||||||||||
(in thousands) | Electric utility | Bank | Other | Total | Electric utility | Bank | Other | Total | ||||||||||||||||||||||||||||||||||||||||||
Revenues from contracts with customers | ||||||||||||||||||||||||||||||||||||||||||||||||||
Electric energy sales - residential | $ | $ | $ | $ | $ | $ | $ | $ | ||||||||||||||||||||||||||||||||||||||||||
Electric energy sales - commercial | ||||||||||||||||||||||||||||||||||||||||||||||||||
Electric energy sales - large light and power | ||||||||||||||||||||||||||||||||||||||||||||||||||
Electric energy sales - other | ||||||||||||||||||||||||||||||||||||||||||||||||||
Bank fees | ||||||||||||||||||||||||||||||||||||||||||||||||||
Other sales | ||||||||||||||||||||||||||||||||||||||||||||||||||
Total revenues from contracts with customers | ||||||||||||||||||||||||||||||||||||||||||||||||||
Revenues from other sources | ||||||||||||||||||||||||||||||||||||||||||||||||||
Regulatory revenue | ( | ( | ||||||||||||||||||||||||||||||||||||||||||||||||
Bank interest and dividend income | ||||||||||||||||||||||||||||||||||||||||||||||||||
Other bank noninterest income | ||||||||||||||||||||||||||||||||||||||||||||||||||
Other | ||||||||||||||||||||||||||||||||||||||||||||||||||
Total revenues from other sources | ||||||||||||||||||||||||||||||||||||||||||||||||||
Total revenues | $ | $ | $ | $ | $ | $ | $ | $ | ||||||||||||||||||||||||||||||||||||||||||
Timing of revenue recognition | ||||||||||||||||||||||||||||||||||||||||||||||||||
Services/goods transferred at a point in time | $ | $ | $ | $ | $ | $ | $ | $ | ||||||||||||||||||||||||||||||||||||||||||
Services/goods transferred over time | ||||||||||||||||||||||||||||||||||||||||||||||||||
Total revenues from contracts with customers | $ | $ | $ | $ | $ | $ | $ | $ |
Three months ended June 30, 2023 | Six months ended June 30, 2023 | |||||||||||||||||||||||||||||||||||||||||||||||||
(in thousands) | Electric utility | Bank | Other | Total | Electric utility | Bank | Other | Total | ||||||||||||||||||||||||||||||||||||||||||
Revenues from contracts with customers | ||||||||||||||||||||||||||||||||||||||||||||||||||
Electric energy sales - residential | $ | $ | $ | $ | $ | $ | $ | $ | ||||||||||||||||||||||||||||||||||||||||||
Electric energy sales - commercial | ||||||||||||||||||||||||||||||||||||||||||||||||||
Electric energy sales - large light and power | ||||||||||||||||||||||||||||||||||||||||||||||||||
Electric energy sales - other | ||||||||||||||||||||||||||||||||||||||||||||||||||
Bank fees | ||||||||||||||||||||||||||||||||||||||||||||||||||
Other sales | ||||||||||||||||||||||||||||||||||||||||||||||||||
Total revenues from contracts with customers | ||||||||||||||||||||||||||||||||||||||||||||||||||
Revenues from other sources | ||||||||||||||||||||||||||||||||||||||||||||||||||
Regulatory revenue | ||||||||||||||||||||||||||||||||||||||||||||||||||
Bank interest and dividend income | ||||||||||||||||||||||||||||||||||||||||||||||||||
Other bank noninterest income | ||||||||||||||||||||||||||||||||||||||||||||||||||
Other | ||||||||||||||||||||||||||||||||||||||||||||||||||
Total revenues from other sources | ||||||||||||||||||||||||||||||||||||||||||||||||||
Total revenues | $ | $ | $ | $ | $ | $ | $ | $ | ||||||||||||||||||||||||||||||||||||||||||
Timing of revenue recognition | ||||||||||||||||||||||||||||||||||||||||||||||||||
Services/goods transferred at a point in time | $ | $ | $ | $ | $ | $ | $ | $ | ||||||||||||||||||||||||||||||||||||||||||
Services/goods transferred over time | ||||||||||||||||||||||||||||||||||||||||||||||||||
Total revenues from contracts with customers | $ | $ | $ | $ | $ | $ | $ | $ |
Three months ended June 30 | Six months ended June 30 | |||||||||||||||||||||||||||||||||||||||||||||||||
Pension benefits | Other benefits | Pension benefits | Other benefits | |||||||||||||||||||||||||||||||||||||||||||||||
(in thousands) | 2024 | 2023 | 2024 | 2023 | 2024 | 2023 | 2024 | 2023 | ||||||||||||||||||||||||||||||||||||||||||
HEI consolidated | ||||||||||||||||||||||||||||||||||||||||||||||||||
Service cost | $ | $ | $ | $ | $ | $ | $ | $ | ||||||||||||||||||||||||||||||||||||||||||
Interest cost | ||||||||||||||||||||||||||||||||||||||||||||||||||
Expected return on plan assets | ( | ( | ( | ( | ( | ( | ( | ( | ||||||||||||||||||||||||||||||||||||||||||
Amortization of net prior period gain | ( | ( | ||||||||||||||||||||||||||||||||||||||||||||||||
Amortization of net actuarial (gain)/losses | ( | ( | ( | ( | ||||||||||||||||||||||||||||||||||||||||||||||
Net periodic pension/benefit cost (return) | ( | ( | ( | ( | ||||||||||||||||||||||||||||||||||||||||||||||
Impact of PUC D&Os | ||||||||||||||||||||||||||||||||||||||||||||||||||
Net periodic pension/benefit cost (return) (adjusted for impact of PUC D&Os) | $ | $ | $ | ( | $ | ( | $ | $ | $ | ( | $ | ( | ||||||||||||||||||||||||||||||||||||||
Hawaiian Electric consolidated | ||||||||||||||||||||||||||||||||||||||||||||||||||
Service cost | $ | $ | $ | $ | $ | $ | $ | $ | ||||||||||||||||||||||||||||||||||||||||||
Interest cost | ||||||||||||||||||||||||||||||||||||||||||||||||||
Expected return on plan assets | ( | ( | ( | ( | ( | ( | ( | ( | ||||||||||||||||||||||||||||||||||||||||||
Amortization of net prior period gain | ( | ( | ||||||||||||||||||||||||||||||||||||||||||||||||
Amortization of net actuarial (gain)/losses | ( | ( | ( | ( | ||||||||||||||||||||||||||||||||||||||||||||||
Net periodic pension/benefit cost (return) | ( | ( | ( | ( | ||||||||||||||||||||||||||||||||||||||||||||||
Impact of PUC D&Os | ||||||||||||||||||||||||||||||||||||||||||||||||||
Net periodic pension/benefit cost (return) (adjusted for impact of PUC D&Os) | $ | $ | $ | ( | $ | ( | $ | $ | $ | ( | $ | ( |
Three months ended June 30 | Six months ended June 30 | |||||||||||||||||||||||||
(in millions) | 2024 | 2023 | 2024 | 2023 | ||||||||||||||||||||||
HEI consolidated | ||||||||||||||||||||||||||
Share-based compensation expense 1 | $ | $ | $ | $ | ||||||||||||||||||||||
Income tax benefit | ||||||||||||||||||||||||||
Hawaiian Electric consolidated | ||||||||||||||||||||||||||
Share-based compensation expense 1 | ||||||||||||||||||||||||||
Income tax benefit |
Three months ended June 30 | Six months ended June 30 | |||||||||||||||||||||||||
(dollars in millions) | 2024 | 2023 | 2024 | 2023 | ||||||||||||||||||||||
Shares granted | ||||||||||||||||||||||||||
Fair value | $ | $ | $ | $ | ||||||||||||||||||||||
Income tax benefit |
Three months ended June 30 | Six months ended June 30 | ||||||||||||||||||||||||||||||||||||||||||||||
2024 | 2023 | 2024 | 2023 | ||||||||||||||||||||||||||||||||||||||||||||
Shares | (1) | Shares | (1) | Shares | (1) | Shares | (1) | ||||||||||||||||||||||||||||||||||||||||
Outstanding, beginning of period | $ | $ | $ | $ | |||||||||||||||||||||||||||||||||||||||||||
Granted | |||||||||||||||||||||||||||||||||||||||||||||||
Vested | ( | ( | ( | ( | |||||||||||||||||||||||||||||||||||||||||||
Forfeited | ( | ( | ( | ||||||||||||||||||||||||||||||||||||||||||||
Outstanding, end of period | $ | $ | $ | $ | |||||||||||||||||||||||||||||||||||||||||||
Total weighted-average grant-date fair value of shares granted (in millions) | $ | $ | $ | $ |
Three months ended June 30 | Six months ended June 30 | ||||||||||||||||||||||||||||||||||||||||||||||
2024 | 2023 | 2024 | 2023 | ||||||||||||||||||||||||||||||||||||||||||||
Shares | (1) | Shares | (1) | Shares | (1) | Shares | (1) | ||||||||||||||||||||||||||||||||||||||||
Outstanding, beginning of period | $ | $ | $ | $ | |||||||||||||||||||||||||||||||||||||||||||
Granted | |||||||||||||||||||||||||||||||||||||||||||||||
Vested (issued or unissued and cancelled) | ( | ( | |||||||||||||||||||||||||||||||||||||||||||||
Forfeited | ( | ( | ( | ( | |||||||||||||||||||||||||||||||||||||||||||
Outstanding, end of period | $ | $ | $ | $ | |||||||||||||||||||||||||||||||||||||||||||
Total weighted-average grant-date fair value of shares granted (in millions) | $ | $ | $ | $ |
2024 | 2023 | |||||||||||||
Risk-free interest rate | % | % | ||||||||||||
Expected life in years | ||||||||||||||
Expected volatility | % | % | ||||||||||||
Range of expected volatility for Peer Group | ||||||||||||||
Grant-date fair value (per share) | $ | $ |
Three months ended June 30 | Six months ended June 30 | ||||||||||||||||||||||||||||||||||||||||||||||
2024 | 2023 | 2024 | 2023 | ||||||||||||||||||||||||||||||||||||||||||||
Shares | (1) | Shares | (1) | Shares | (1) | Shares | (1) | ||||||||||||||||||||||||||||||||||||||||
Outstanding, beginning of period | $ | $ | $ | $ | |||||||||||||||||||||||||||||||||||||||||||
Granted | |||||||||||||||||||||||||||||||||||||||||||||||
Vested | ( | ( | |||||||||||||||||||||||||||||||||||||||||||||
Increase above target (cancelled) | ( | ( | |||||||||||||||||||||||||||||||||||||||||||||
Forfeited | ( | ( | ( | ( | |||||||||||||||||||||||||||||||||||||||||||
Outstanding, end of period | $ | $ | $ | $ | |||||||||||||||||||||||||||||||||||||||||||
Total weighted-average grant-date fair value of shares granted (at target performance levels) (in millions) | $ | $ | $ | $ |
Six months ended June 30 | 2024 | 2023 | ||||||||||||
(in millions) | ||||||||||||||
Supplemental disclosures of cash flow information | ||||||||||||||
HEI consolidated | ||||||||||||||
Interest paid to non-affiliates, net of amounts capitalized | $ | $ | ||||||||||||
Income taxes paid (including refundable credits) | ||||||||||||||
Income taxes refunded (including refundable credits) | ||||||||||||||
Hawaiian Electric consolidated | ||||||||||||||
Interest paid to non-affiliates | ||||||||||||||
Income taxes paid (including refundable credits) | ||||||||||||||
Income taxes refunded (including refundable credits) | ||||||||||||||
Supplemental disclosures of noncash activities | ||||||||||||||
HEI consolidated | ||||||||||||||
Property, plant and equipment | ||||||||||||||
Estimated fair value of noncash contributions in aid of construction (investing) | ||||||||||||||
Unpaid invoices and accruals for capital expenditures, balance, end of period (investing) | ||||||||||||||
Right-of-use assets obtained in exchange for finance lease obligations (financing) | ||||||||||||||
Right-of-use assets obtained in exchange for operating lease obligations (investing) | ||||||||||||||
Common stock issued (gross) for director and executive/management compensation (financing)1 | ||||||||||||||
Obligations to fund low income housing investments (investing) | ||||||||||||||
Loans transferred from held for investment to held for sale (investing) | ||||||||||||||
Transfer of retail repurchase agreements to deposit liabilities (financing) | ||||||||||||||
Hawaiian Electric consolidated | ||||||||||||||
Electric utility property, plant and equipment | ||||||||||||||
Estimated fair value of noncash contributions in aid of construction (investing) | ||||||||||||||
Unpaid invoices and accruals for capital expenditures, balance, end of period (investing) | ||||||||||||||
Right-of-use assets obtained in exchange for finance lease obligations (financing) | ||||||||||||||
Estimated fair value | ||||||||||||||||||||||||||||||||
(in thousands) | Carrying or notional amount | Quoted prices in active markets for identical assets (Level 1) | Significant other observable inputs (Level 2) | Significant unobservable inputs (Level 3) | Total | |||||||||||||||||||||||||||
June 30, 2024 | ||||||||||||||||||||||||||||||||
Financial assets | ||||||||||||||||||||||||||||||||
HEI consolidated | ||||||||||||||||||||||||||||||||
Available-for-sale investment securities | $ | $ | $ | $ | $ | |||||||||||||||||||||||||||
Held-to-maturity investment securities | ||||||||||||||||||||||||||||||||
Loans, net | ||||||||||||||||||||||||||||||||
Mortgage servicing rights | ||||||||||||||||||||||||||||||||
Financial liabilities | ||||||||||||||||||||||||||||||||
HEI consolidated | ||||||||||||||||||||||||||||||||
Deposit liabilities - time certificates | ||||||||||||||||||||||||||||||||
Other bank borrowings | ||||||||||||||||||||||||||||||||
Long-term debt, net—other than bank | ||||||||||||||||||||||||||||||||
Hawaiian Electric consolidated | ||||||||||||||||||||||||||||||||
Long-term debt, net | ||||||||||||||||||||||||||||||||
December 31, 2023 | ||||||||||||||||||||||||||||||||
Financial assets | ||||||||||||||||||||||||||||||||
HEI consolidated | ||||||||||||||||||||||||||||||||
Available-for-sale investment securities | $ | $ | $ | $ | $ | |||||||||||||||||||||||||||
Held-to-maturity investment securities | ||||||||||||||||||||||||||||||||
Loans, net | ||||||||||||||||||||||||||||||||
Mortgage servicing rights | ||||||||||||||||||||||||||||||||
Financial liabilities | ||||||||||||||||||||||||||||||||
HEI consolidated | ||||||||||||||||||||||||||||||||
Deposit liabilities - time certificates | ||||||||||||||||||||||||||||||||
Other bank borrowings | ||||||||||||||||||||||||||||||||
Long-term debt, net—other than bank | ||||||||||||||||||||||||||||||||
Hawaiian Electric consolidated | ||||||||||||||||||||||||||||||||
Long-term debt, net | ||||||||||||||||||||||||||||||||
June 30, 2024 | December 31, 2023 | |||||||||||||||||||||||||||||||||||||
Fair value measurements using | Fair value measurements using | |||||||||||||||||||||||||||||||||||||
(in thousands) | Level 1 | Level 2 | Level 3 | Level 1 | Level 2 | Level 3 | ||||||||||||||||||||||||||||||||
Available-for-sale investment securities (bank segment) | ||||||||||||||||||||||||||||||||||||||
Mortgage-backed securities — issued or guaranteed by U.S. Government agencies or sponsored agencies | $ | $ | $ | $ | $ | $ | ||||||||||||||||||||||||||||||||
U.S. Treasury and federal agency obligations | ||||||||||||||||||||||||||||||||||||||
Corporate bonds | ||||||||||||||||||||||||||||||||||||||
Mortgage revenue bonds | ||||||||||||||||||||||||||||||||||||||
$ | $ | $ | $ | $ | $ | |||||||||||||||||||||||||||||||||
Derivative assets | ||||||||||||||||||||||||||||||||||||||
Interest rate lock commitments (bank segment)1 | $ | $ | $ | $ | $ | $ | ||||||||||||||||||||||||||||||||
Forward commitments (bank segment)1 | ||||||||||||||||||||||||||||||||||||||
Interest rate swap (Other segment)2 | ||||||||||||||||||||||||||||||||||||||
$ | $ | $ | $ | $ | $ | |||||||||||||||||||||||||||||||||
Derivative liabilities | ||||||||||||||||||||||||||||||||||||||
Forward commitments (bank segment)1 | $ | $ | $ | $ | $ | $ | ||||||||||||||||||||||||||||||||
Interest rate swap (Other segment)2 | ||||||||||||||||||||||||||||||||||||||
$ | $ | $ | $ | $ | $ |
Three months ended June 30 | Six months ended June 30 | |||||||||||||||||||||||||
Mortgage revenue bonds | 2024 | 2023 | 2024 | 2023 | ||||||||||||||||||||||
(in thousands) | ||||||||||||||||||||||||||
Beginning balance | $ | $ | $ | $ | ||||||||||||||||||||||
Principal payments received | ( | ( | ( | ( | ||||||||||||||||||||||
Purchases | ||||||||||||||||||||||||||
Unrealized gain (loss) included in other comprehensive income | ||||||||||||||||||||||||||
Ending balance | $ | $ | $ | $ |
Three months ended June 30, | % | |||||||||||||||||||||||||
(in thousands) | 2024 | 2023 | change | Primary reason(s)* | ||||||||||||||||||||||
Revenues | $ | 897,360 | $ | 895,685 | — | Increase for the bank segment, offset by decreases for the electric utility and “other” segments. | ||||||||||||||||||||
Operating income (loss) | (1,718,975) | 92,979 | NM | Decrease for the electric utility (includes wildfire tort-related claims of $1.71 billion) and bank (includes goodwill impairment of $82.2 million) segments and higher operating loss for the “other” segment. See below for HEI Consolidated Maui windstorm and wildfires costs, net. | ||||||||||||||||||||||
Net income (loss) for common stock | (1,295,484) | 54,610 | NM | Lower net income for the electric utility and bank segments and higher net loss for the “other” segment. See below for HEI Consolidated Maui windstorm and wildfires costs, net and effective tax rate explanation. | ||||||||||||||||||||||
Six months ended June 30 | % | |||||||||||||||||||||||||
(in thousands) | 2024 | 2023 | change | Primary reason(s)* | ||||||||||||||||||||||
Revenues | $ | 1,794,518 | $ | 1,823,922 | (2) | Decreases for the electric utility and “other” segments, partly offset by an increase for the bank segment. | ||||||||||||||||||||
Operating income (loss) | (1,642,556) | 186,497 | NM | Decrease for the electric utility (includes wildfire tort-related claims of $1.71 billion) and bank (includes goodwill impairment of $82.2 million) segments and higher operating loss for the “other” segment. See below for HEI Consolidated Maui windstorm and wildfires costs, net. | ||||||||||||||||||||||
Net income (loss) for common stock | (1,253,362) | 109,331 | NM | Lower net income for the electric utility and bank segments and higher net loss for the “other” segment. See below for HEI Consolidated Maui windstorm and wildfires costs, net and effective tax rate explanation. | ||||||||||||||||||||||
Three months ended June 30, 2024 | ||||||||||||||||||||||||||
(in thousands) | Electric utility | Bank | Other segment | HEI Consolidated | ||||||||||||||||||||||
Maui windstorm and wildfires related expenses: | ||||||||||||||||||||||||||
Legal expenses | $ | 17,613 | $ | 819 | $ | 6,568 | $ | 25,000 | ||||||||||||||||||
Outside services expense | 997 | 382 | 399 | 1,778 | ||||||||||||||||||||||
Provision for credit losses | — | (800) | — | (800) | ||||||||||||||||||||||
Wildfire tort-related claims | 1,712,000 | 2 | — | — | 1,712,000 | |||||||||||||||||||||
Other expense | 5,741 | 3 | 51 | 1,139 | 6,931 | |||||||||||||||||||||
Interest expense | 2,524 | — | 862 | 3,386 | ||||||||||||||||||||||
Total Maui windstorm and wildfires related expenses | 1,738,875 | 452 | 8,968 | 1,748,295 | ||||||||||||||||||||||
Insurance recoveries | (16,379) | — | (2,496) | (18,875) | ||||||||||||||||||||||
Deferral treatment approved by the PUC1 | (7,656) | — | — | (7,656) | ||||||||||||||||||||||
Total Maui windstorm and wildfires related expenses, net of insurance recoveries and approved deferral treatment | $ | 1,714,840 | $ | 452 | $ | 6,472 | $ | 1,721,764 |
Six months ended June 30, 2024 | ||||||||||||||||||||||||||
(in thousands) | Electric utility | Bank | Other segment | HEI Consolidated | ||||||||||||||||||||||
Maui windstorm and wildfires related expenses: | ||||||||||||||||||||||||||
Legal expenses | $ | 28,348 | $ | 902 | $ | 10,777 | $ | 40,027 | ||||||||||||||||||
Outside services expense | 1,781 | 2,007 | 737 | 4,525 | ||||||||||||||||||||||
Provision for credit losses | — | (2,300) | — | (2,300) | ||||||||||||||||||||||
Wildfire tort-related claims | 1,712,000 | 2 | — | — | 1,712,000 | |||||||||||||||||||||
Other expense | 14,882 | 3 | (266) | 1,334 | 15,950 | |||||||||||||||||||||
Interest expense | 6,431 | — | 1,780 | 8,211 | ||||||||||||||||||||||
Total Maui windstorm and wildfires related expenses | 1,763,442 | 343 | 14,628 | 1,778,413 | ||||||||||||||||||||||
Insurance recoveries | (26,348) | — | (5,104) | (31,452) | ||||||||||||||||||||||
Deferral treatment approved by the PUC1 | (15,554) | — | — | (15,554) | ||||||||||||||||||||||
Total Maui windstorm and wildfires related expenses, net of insurance recoveries and approved deferral treatment | $ | 1,721,540 | $ | 343 | $ | 9,524 | $ | 1,731,407 |
Three months ended June 30, | ||||||||||||||||||||
(in thousands) | 2024 | 2023 | Primary reason(s) | |||||||||||||||||
Revenues | $ | 3,086 | $ | 4,609 | The revenues for the second quarter of 2024 were lower than the comparable period in 2023 primarily due to lower sales at Pacific Current1 subsidiaries. | |||||||||||||||
Operating loss | (17,149) | (5,514) | The second quarters of 2024 and 2023 include $4.0 million of operating loss and $0.6 million of operating income, respectively, from Pacific Current1. The higher operating loss is primarily due to lower Pacific Current asset performances mainly at Hamakua Energy and Mahipapa due to unexpected plant shut downs in the first quarter of 2024 as compared to the prior year period. Corporate expenses for the second quarter of 2024 were $7.1 million higher than the same period in 2023, primarily due to $5.6 million of Maui windstorm and wildfires related costs, net of insurance recovery for the second quarter of 2024. | |||||||||||||||||
Net loss | (20,303) | (10,893) | The net loss for the second quarter of 2024 was higher than the net loss for the second quarter of 2023 due to $0.3 million higher interest expense, net of interest income, primarily related to HEI’s August 2023 draw on the revolving credit facility as compared to the prior year period, and the same factors cited for the change in operating loss above. Also see effective tax rate explanations above. |
Six months ended June 30 | ||||||||||||||||||||
(in thousands) | 2024 | 2023 | Primary reason(s) | |||||||||||||||||
Revenues | $ | 6,522 | $ | 8,628 | The revenues for the first six months of 2024 were lower than the comparable period in 2023 primarily due to lower sales at Pacific Current1 subsidiaries. | |||||||||||||||
Operating loss | (29,617) | (11,391) | The first six months of 2024 and 2023 include $9.5 million and $0.5 million of operating loss, respectively, from Pacific Current1. The higher operating loss is primarily due to a $3.5 million impairment loss on assets damaged in a March 2024 fire at Mahipapa and lower Pacific Current asset performances mainly at Hamakua Energy and Mahipapa due to unexpected plant shut downs in the first quarter of 2024 as compared to the prior year period. Corporate expenses for the first six months of 2024 were $9.3 million higher than the same period in 2023, primarily due to $7.7 million of Maui windstorm and wildfires related costs, net of insurance recovery for the first six months of 2024. | |||||||||||||||||
Net loss | (38,336) | (21,743) | The net loss for the first six months of 2024 was higher than the net loss for the first six months of 2023 due to $1.7 million higher interest expense, net of interest income, primarily related to HEI’s August 2023 draw on the revolving credit facility as compared to the prior year period, and the same factors cited for the change in operating loss above. Also see effective tax rate explanations above. |
(dollars in millions) | June 30, 2024 | December 31, 2023 | ||||||||||||||||||||||||
Long-term debt, net—other than bank | $ | 2,838 | 72 | % | $ | 2,842 | 54 | % | ||||||||||||||||||
Preferred stock of subsidiaries | 34 | 1 | 34 | 1 | ||||||||||||||||||||||
Common stock equity | 1,085 | 27 | 2,345 | 45 | ||||||||||||||||||||||
$ | 3,957 | 100 | % | $ | 5,221 | 100 | % |
Three months ended June 30 | Increase | |||||||||||||||||||||||||
2024 | 2023 | (decrease) | (dollars in millions, except per barrel amounts) | |||||||||||||||||||||||
$ | 792 | $ | 794 | $ | (2) | Revenues. Net decrease largely due to: | ||||||||||||||||||||
$ | (26) | lower kWh generated and lower fuel oil prices1 | ||||||||||||||||||||||||
2 | higher DSM revenue | |||||||||||||||||||||||||
2 | higher MPIR revenue | |||||||||||||||||||||||||
6 | higher revenue from ARA adjustments | |||||||||||||||||||||||||
14 | higher kWh purchased and higher PPAC revenues, partially offset by lower purchased power energy prices2 | |||||||||||||||||||||||||
259 | 280 | (21) | Fuel oil expense1. Net decrease largely due to lower kWh generated and lower fuel oil prices, offset in part by worse heat rate performance, impacted by battery storage round trip efficiency loss | |||||||||||||||||||||||
181 | 168 | 13 | Purchased power expense1, 2. Net increase largely due to higher kWh purchased, along with the addition of Stage 1 and Stage 2 renewable projects, offset in part by lower purchased power energy prices and the recovery of compensable curtailment energy payments in 2023 | |||||||||||||||||||||||
148 | 136 | 12 | Operation and maintenance expenses. Net increase largely due to: | |||||||||||||||||||||||
3 | wildfire mitigation program related to inspections | |||||||||||||||||||||||||
3 | the settlement of indemnification claims asserted by the State of Hawaii3 | |||||||||||||||||||||||||
3 | higher property and general liability insurance costs | |||||||||||||||||||||||||
2 | higher transmission and distribution operation and maintenance expense | |||||||||||||||||||||||||
1 | higher Demand Response cost | |||||||||||||||||||||||||
1 | amortization of Honolulu generating units 8 and 9 net book value at retirement | |||||||||||||||||||||||||
1 | higher employee benefits costs | |||||||||||||||||||||||||
(2) | less station maintenance work performed | |||||||||||||||||||||||||
(2) | higher storm costs incurred in 2023 due to inclement weather | |||||||||||||||||||||||||
1,712 | — | 1,712 | Wildfire tort-related claims. Increase due to the accrual of estimated wildfire liabilities related to the settlement of the Maui windstorm and wildfire tort-related legal claims | |||||||||||||||||||||||
137 | 136 | 1 | Other expenses. Increase due to higher depreciation expense due to increasing investments to integrate more renewable energy and improve customer reliability and system efficiency, partially offset by lower revenue and payroll taxes | |||||||||||||||||||||||
(1,644) | 74 | (1,718) | Operating income (loss). Decrease largely due to wildfire tort-related claims, higher operation and maintenance expenses along with higher depreciation expenses, offset in part by higher ARA and MPIR revenue | |||||||||||||||||||||||
(1,659) | 59 | (1,718) | Income (loss) before income taxes. Decrease largely due to operating loss, partially offset by higher interest income earned on higher cash balances | |||||||||||||||||||||||
(1,229) | 45 | (1,274) | Net income (loss) for common stock. Decrease due to loss before income taxes. See below for effective tax rate explanation | |||||||||||||||||||||||
1,971 | 1,994 | (23) | Kilowatthour sales (millions)3 | |||||||||||||||||||||||
$ | 120.12 | $ | 122.69 | $ | (2.57) | Average fuel oil cost per barrel |
Six months ended June 30 | Increase | |||||||||||||||||||||||||
2024 | 2023 | (decrease) | (dollars in millions, except per barrel amounts) | |||||||||||||||||||||||
$ | 1,581 | $ | 1,625 | $ | (44) | Revenues. Net decrease largely due to: | ||||||||||||||||||||
$ | (84) | lower fuel oil prices and lower kWh generated1 | ||||||||||||||||||||||||
3 | higher DSM revenue | |||||||||||||||||||||||||
3 | higher MPIR revenue | |||||||||||||||||||||||||
12 | higher revenue from ARA adjustments | |||||||||||||||||||||||||
22 | higher kWh purchased and higher PPAC revenues, partially offset by lower purchased power energy prices2 | |||||||||||||||||||||||||
543 | 614 | (71) | Fuel oil expense2. Net decrease largely due to lower fuel oil prices and lower kWh generated, offset in part by worse heat rate performance, impacted by battery storage round trip efficiency loss and the loss of more efficient generator units on Oahu and Hawaii Island | |||||||||||||||||||||||
341 | 321 | 20 | Purchased power expense1, 2. Net increase largely due to higher kWh purchased, along with the addition of Stage 1 and Stage 2 renewable projects, offset in part by lower purchased power energy prices and the recovery of compensable curtailment energy payments in 2023 | |||||||||||||||||||||||
291 | 265 | 26 | Operation and maintenance expenses. Net increase largely due to: | |||||||||||||||||||||||
10 | the settlement of indemnification claims asserted by the State of Hawaii3 | |||||||||||||||||||||||||
6 | wildfire mitigation program related to inspections | |||||||||||||||||||||||||
5 | higher property and general liability insurance costs | |||||||||||||||||||||||||
4 | higher transmission and distribution operation and maintenance expense | |||||||||||||||||||||||||
3 | higher Demand Response cost | |||||||||||||||||||||||||
2 | amortization of Honolulu generating units 8 and 9 net book value at retirement | |||||||||||||||||||||||||
2 | higher employee benefits costs | |||||||||||||||||||||||||
(2) | less station maintenance work performed | |||||||||||||||||||||||||
(3) | higher storm costs incurred in 2023 due to inclement weather | |||||||||||||||||||||||||
1,712 | — | 1,712 | Wildfire tort-related claims. Increase due to the accrual of estimated wildfire liabilities related to the settlement of the Maui windstorm and wildfire tort-related legal claims | |||||||||||||||||||||||
274 | 275 | (1) | Other expenses. Decrease due to lower revenue and payroll taxes, offset by higher depreciation expense due to increasing investments to integrate more renewable energy and improve customer reliability and system efficiency | |||||||||||||||||||||||
(1,581) | 150 | (1,731) | Operating income (loss). Decrease largely due to wildfire tort-related claims, higher operation and maintenance expenses along with higher depreciation expenses, offset in part by higher ARA and MPIR revenue | |||||||||||||||||||||||
(1,608) | 120 | (1,728) | Income (loss) before income taxes. Decrease largely due to operating loss, partially offset by higher interest income earned on higher cash balances | |||||||||||||||||||||||
(1,190) | 92 | (1,282) | Net income (loss) for common stock. Decrease due to loss before income taxes. See below for effective tax rate explanation | |||||||||||||||||||||||
3,877 | 3,930 | (53) | Kilowatthour sales (millions)4 | |||||||||||||||||||||||
$ | 121.01 | $ | 131.48 | $ | (10.47) | Average fuel oil cost per barrel | ||||||||||||||||||||
470,532 | 472,482 | (1,950) | Customer accounts (end of period) |
% | Rate-making Return on rate base (RORB)* | ROACE** | Rate-making ROACE*** | |||||||||||||||||||||||||||||||||||||||||||||||||||||
Twelve months ended June 30, 2024 | Hawaiian Electric | Hawaii Electric Light | Maui Electric | Hawaiian Electric | Hawaii Electric Light | Maui Electric | Hawaiian Electric | Hawaii Electric Light | Maui Electric | |||||||||||||||||||||||||||||||||||||||||||||||
Utility returns | NM | NM | NM | NM | NM | NM | NM | NM | NM | |||||||||||||||||||||||||||||||||||||||||||||||
PUC-allowed returns | 7.37 | 7.52 | 7.43 | 9.50 | 9.50 | 9.50 | 9.50 | 9.50 | 9.50 | |||||||||||||||||||||||||||||||||||||||||||||||
Utilities | Number of contracts | Total photovoltaic size (MW) | BESS Size (MW/MWh) | Guaranteed commercial operation dates | Contract term (years) | Total projected annual payment (in millions) | ||||||||||||||||||||||||||||||||
Hawaiian Electric | 4 | 139.5 | 139.5/558 | 7/31/22, 1/11/23, 3/28/24 & 10/31/24 | 20 & 25 | $ | 34.0 | |||||||||||||||||||||||||||||||
Hawaii Electric Light | 2 | 60 | 60/240 | 4/21/23 & 1/28/25 | 25 | 19.2 | ||||||||||||||||||||||||||||||||
Maui Electric | 1 | 60 | 60/240 | 5/31/24 | 25 | 13.2 | ||||||||||||||||||||||||||||||||
Total | 7 | 259.5 | 259.5/1038 | $ | 66.4 |
Utilities | Number of contracts | Total photovoltaic size (MW) | BESS Size (MW/MWh) | Guaranteed commercial operation dates | Contract term (years) | Total projected annual payment (in millions) | ||||||||||||||||||||||||||||||||||||||
Hawaiian Electric | 3 | 79 | 79 | / | 443 | 5/17/24*, 6/7/24 & 9/1/24 | 20 & 25 | $ | 31.4 | |||||||||||||||||||||||||||||||||||
Hawaiian Electric | 1 | N/A | 185 | / | 565 | 12/19/23 | 20 | 24.0 | ||||||||||||||||||||||||||||||||||||
Total | 4 | 79 | 264 | / | 1,008 | $ | 55.4 |
Utilities | Fast Frequency Response - 1 (MW) | Fast Frequency Response - 2 (MW) | Capacity - Load Build (MW) | Capacity - Load Reduction (MW) | ||||||||||||||||||||||
Hawaiian Electric | — | 26.7 | 14.5 | 19.4 | ||||||||||||||||||||||
Hawaii Electric Light | 6.0 | — | 3.2 | 4.0 | ||||||||||||||||||||||
Maui Electric | 6.1 | — | 1.9 | 4.7 | ||||||||||||||||||||||
Total | 12.1 | 26.7 | 19.6 | 28.1 |
Utilities | Number of contracts | BESS Size (MW/MWh) | Guaranteed commercial operation dates | |||||||||||||||||
Hawaii Electric Light | 1 | * | 12/12 | 12/30/22 | ||||||||||||||||
Maui Electric | 1 | 40/160 | 11/30/26 | |||||||||||||||||
Total | 2 | 52/172 |
(dollars in millions) | June 30, 2024 | December 31, 2023 | ||||||||||||||||||||||||
Long-term debt, net | $ | 1,935 | 61 | % | $ | 1,934 | 44 | % | ||||||||||||||||||
Preferred stock | 34 | 1 | 34 | 1 | ||||||||||||||||||||||
Common stock equity | 1,193 | 38 | 2,409 | 55 | ||||||||||||||||||||||
$ | 3,162 | 100 | % | $ | 4,377 | 100 | % |
(in millions) | Hawaiian Electric | Hawaii Electric Light | Maui Electric | ||||||||
Total “up to” amounts of taxable debt authorized from 2023 through 2026 | $ | 230 | $ | 65 | $ | 105 | |||||
Less: taxable debt executed on January 10, 2023, but issued on February 9, 2023 | 100 | 25 | 25 | ||||||||
Remaining authorized amounts | $ | 130 | $ | 40 | $ | 80 |
Six months ended June 30 | |||||||||||||||||
(in thousands) | 2024 | 2023 | Change | ||||||||||||||
Net cash provided by operating activities | $ | 185,473 | $ | 336,145 | $ | (150,672) | |||||||||||
Net cash used in investing activities | (166,657) | (226,093) | 59,436 | ||||||||||||||
Net cash used in financing activities | (36,273) | (5,647) | (30,626) |
Three months ended June 30 | Increase | |||||||||||||||||||||||||
(in millions) | 2024 | 2023 | (decrease) | Primary reason(s) | ||||||||||||||||||||||
Interest and dividend income | $ | 86 | $ | 82 | $ | 4 | ||||||||||||||||||||
Average loan portfolio yields were 35 basis points higher—yield benefited from the rising interest rate environment as adjustable rate yields repriced upward and new loan production yields were higher than the portfolio yields. | ||||||||||||||||||||||||||
Average loan portfolio balances decreased $14 million—commercial, home equity line of credit and consumer loan portfolio average balances decreased $104 million, $45 million and $28 million, respectively, due to decreased demand for these loan products. Residential and commercial real estate loan average balances increased $97 million and $68 million, respectively. | ||||||||||||||||||||||||||
Average investment securities portfolio balances decreased $390 million—investment security portfolio repayments were used to pay down maturing higher costing liabilities. Average investment securities portfolio yields were 5 basis points lower due to higher investment portfolio premium amortizations. | ||||||||||||||||||||||||||
Average other investments increased $69 million—increase due to higher interest-earning deposits being held. | ||||||||||||||||||||||||||
Noninterest income | 16 | 16 | — | |||||||||||||||||||||||
Revenues | 102 | 98 | 4 | The increase in revenues for the three months ended June 30, 2024 compared to the same period in 2023 was primarily due to higher interest and dividend income. | ||||||||||||||||||||||
Interest expense | 24 | 19 | 5 | |||||||||||||||||||||||
Increase in interest expense due to an increase in interest expense on deposits offset by a decrease in interest expense on other borrowings due to the increase in the interest rate environment and a shift in costing liability mix. | ||||||||||||||||||||||||||
Average core deposit balances decreased $293 million; average term certificate balances increased $214 million. | ||||||||||||||||||||||||||
Average deposit yields increased from 48 basis points to 90 basis points due to a shift in mix of deposits and higher yields from the increase in the interest rate environment. | ||||||||||||||||||||||||||
Average other borrowings decreased $285 million and average yields increased 49 basis points. | ||||||||||||||||||||||||||
Average cost of funds increased from 83 basis points to 115 basis points due to a shift in funding from low cost core deposits to higher costing term certificates and other borrowings. | ||||||||||||||||||||||||||
Provision for credit losses | (2) | — | (2) | |||||||||||||||||||||||
2024 negative provision for credit losses included reversal of $0.8 million credit loss reserves for loans impacted by the Maui wildfires, improving loan loss rates and lower loan portfolio balances. | ||||||||||||||||||||||||||
Delinquency rates have increased—from 0.17% at June 30, 2023 to 0.47% at June 30, 2024 primarily due to Maui-related loan accommodations and one commercial real estate loan in foreclosure. | ||||||||||||||||||||||||||
Net charge-off to average loans increased 1 basis point from 0.14% at June 30, 2023 to 0.15% at June 30, 2024 primarily due to an increase in consumer loan net charge-offs. | ||||||||||||||||||||||||||
Noninterest expense | 136 | 54 | 82 | |||||||||||||||||||||||
Increase in noninterest expense is due to a goodwill impairment charge of $82.2 million as a result of HEI’s comprehensive review of strategic options for ASB. | ||||||||||||||||||||||||||
Expenses | 158 | 73 | 85 | The increase in expenses for the three months ended June 30, 2024 compared to the same period in 2023 was due to an increase in noninterest expense and interest expense, partially offset by a decrease in provision for credit losses. | ||||||||||||||||||||||
Operating income (loss) | (56) | 25 | (81) | The decrease in operating income (loss) for the three months ended June 30, 2024 compared to the same period in 2023 was primarily due to higher noninterest expense and interest expense, partly offset by higher interest and dividend income and lower provision for credit losses. | ||||||||||||||||||||||
Net income (loss) | $ | (46) | $ | 20 | $ | (66) | Net income (loss) for the three months ended June 30, 2024 was lower as compared to the same period in 2023 due to lower operating income. |
Six months ended June 30 | Increase | |||||||||||||||||||||||||
(in millions) | 2024 | 2023 | (decrease) | Primary reason(s) | ||||||||||||||||||||||
Interest and dividend income | $ | 174 | $ | 161 | $ | 13 | ||||||||||||||||||||
Average loan portfolio yields were 38 basis points higher—loan yields continued to increase in 2024 due to the interest rate environment as adjustable rate loan yields repriced with rising interest rates and new loan production yields were higher than the portfolio rates. | ||||||||||||||||||||||||||
Average loan portfolio balances increased $64 million—residential and commercial real estate loan portfolio average balances increased $108 million and $76 million, respectively, due to demand for these loan types. Commercial loan portfolio average balances decreased $75 million due to the payoffs and sale of commercial loans. | ||||||||||||||||||||||||||
Average investment securities portfolio balances decreased $396 million primarily due to repayments, no purchases in 2024 and sale of investment securities in the quarter ended December 31, 2023. | ||||||||||||||||||||||||||
Average investment securities portfolio yields decreased 5 basis points. | ||||||||||||||||||||||||||
Noninterest income | 33 | 30 | 3 | |||||||||||||||||||||||
Higher bank-owned life insurance income—higher returns from insurance policies. | ||||||||||||||||||||||||||
Revenues | 207 | 191 | 16 | The increase in revenues for the six months ended June 30, 2024 compared to the same period in 2023 was primarily due to higher interest and dividend income and higher noninterest income. | ||||||||||||||||||||||
Interest expense | 50 | 33 | 17 | |||||||||||||||||||||||
Increase in interest expense due to an increase in core deposit and term certificate yields, partially offset by lower other borrowing balances. | ||||||||||||||||||||||||||
Average core deposit balances decreased $379 million; average term certificate balances increased $264 million. | ||||||||||||||||||||||||||
Average deposit yields increased from 41 to 89 basis points primarily due to the increase in term certificate yields of 73 basis points and the shift in mix of deposits from low cost core deposits to term certificates. | ||||||||||||||||||||||||||
Average other borrowings decreased $133 million and average yields increased 26 basis points. | ||||||||||||||||||||||||||
Provision for credit losses | (4) | 1 | (5) | |||||||||||||||||||||||
2024 negative provision for credit losses included reversal of $2.3 million credit loss reserves for loans impacted by the Maui wildfires, improving loan loss rates and lower loan portfolio balances. | ||||||||||||||||||||||||||
2024 negative provision for credit losses also included the release of $0.9 million of credit loss reserves for unfunded loan commitments. | ||||||||||||||||||||||||||
Delinquency rates have increased—from 0.17% at June 30, 2023 to 0.47% at June 30, 2024 primarily due to Maui-related loan accommodations and one commercial real estate loan in foreclosure. | ||||||||||||||||||||||||||
Net charge-off to average loans of 0.14% at June 30, 2024 remained the same as compared to the same period in 2023. | ||||||||||||||||||||||||||
Noninterest expense | 192 | 108 | 84 | |||||||||||||||||||||||
The increase in noninterest expenses was primarily due to a goodwill impairment charge of $82.2 million as a result of HEI’s comprehensive review of strategic options for ASB, expenses related to the Maui wildfires and higher compensation and benefits expenses. | ||||||||||||||||||||||||||
Higher compensation and benefits expenses primarily due to fair value adjustments related to the deferred compensation plan. | ||||||||||||||||||||||||||
Expenses | 238 | 142 | 96 | The increase in expenses for the six months ended June 30, 2024 compared to the same period in 2023 was due to higher noninterest expense and interest expense, partially offset by lower provision for credit losses. | ||||||||||||||||||||||
Operating income (loss) | (31) | 49 | (80) | The decrease in operating income (loss) for the six months ended June 30, 2024 compared to the same period in 2023 was primarily due to higher noninterest expense and interest expense, partially offset by higher interest and dividend income, higher noninterest income and lower provision for credit losses. | ||||||||||||||||||||||
Six months ended June 30 | Increase | |||||||||||||||||||||||||
(in millions) | 2024 | 2023 | (decrease) | Primary reason(s) | ||||||||||||||||||||||
Net income (loss) | $ | (25) | $ | 39 | $ | (64) | Net income (loss) for the six months ended June 30, 2024 was lower than the same period in 2023 due to lower operating income. |
Three months ended June 30 | Six months ended June 30 | |||||||||||||||||||||||||
(Annualized %) | 2024 | 2023 | 2024 | 2023 | ||||||||||||||||||||||
Return on average assets | (1.97) | 0.84 | (0.53) | 0.81 | ||||||||||||||||||||||
Return on average equity | (33.97) | 16.20 | (9.25) | 15.87 | ||||||||||||||||||||||
Net interest margin | 2.79 | 2.75 | 2.77 | 2.80 |
(in thousands) | Three months ended June 30, 2024 | Six months ended June 30, 2024 | ||||||||||||
Bank Maui wildfires related cost: | ||||||||||||||
Provision for credit losses | $ | (800) | $ | (2,300) | ||||||||||
Professional services expenses | 1,201 | 2,909 | ||||||||||||
Other expenses1 | 51 | (266) | ||||||||||||
Total Bank Maui wildfires related cost | $ | 452 | $ | 343 | ||||||||||
Three months ended June 30 | ||||||||||||||||||||||||||||||||||||||
2024 | 2023 | |||||||||||||||||||||||||||||||||||||
(dollars in thousands) | Average balance | Interest income/ expense | Yield/ rate (%) | Average balance | Interest income/ expense | Yield/ rate (%) | ||||||||||||||||||||||||||||||||
Assets: | ||||||||||||||||||||||||||||||||||||||
Interest-earning deposits | $ | 106,177 | $ | 1,449 | 5.40 | $ | 36,891 | $ | 488 | 5.23 | ||||||||||||||||||||||||||||
FHLB stock | 29,639 | 743 | 10.10 | 15,660 | 237 | 6.07 | ||||||||||||||||||||||||||||||||
Investment securities | ||||||||||||||||||||||||||||||||||||||
Taxable | 2,600,103 | 10,619 | 1.63 | 2,988,483 | 12,645 | 1.69 | ||||||||||||||||||||||||||||||||
Non-taxable | 66,486 | 515 | 3.08 | 67,912 | 513 | 3.01 | ||||||||||||||||||||||||||||||||
Total investment securities | 2,666,589 | 11,134 | 1.67 | 3,056,395 | 13,158 | 1.72 | ||||||||||||||||||||||||||||||||
Loans | ||||||||||||||||||||||||||||||||||||||
Residential 1-4 family | 2,612,420 | 25,752 | 3.94 | 2,515,753 | 23,111 | 3.67 | ||||||||||||||||||||||||||||||||
Commercial real estate | 1,551,309 | 20,449 | 5.23 | 1,483,566 | 18,373 | 4.91 | ||||||||||||||||||||||||||||||||
Home equity line of credit | 989,972 | 11,090 | 4.51 | 1,034,785 | 9,657 | 3.74 | ||||||||||||||||||||||||||||||||
Residential land | 19,575 | 305 | 6.23 | 20,235 | 269 | 5.32 | ||||||||||||||||||||||||||||||||
Commercial | 672,728 | 10,033 | 5.96 | 777,028 | 10,854 | 5.56 | ||||||||||||||||||||||||||||||||
Consumer | 231,962 | 5,557 | 9.62 | 260,437 | 5,843 | 8.99 | ||||||||||||||||||||||||||||||||
Total loans 1,2 | 6,077,966 | 73,186 | 4.81 | 6,091,804 | 68,107 | 4.46 | ||||||||||||||||||||||||||||||||
Total interest-earning assets 3 | 8,880,371 | 86,512 | 3.89 | 9,200,750 | 81,990 | 3.56 | ||||||||||||||||||||||||||||||||
Allowance for credit losses | (70,669) | (71,191) | ||||||||||||||||||||||||||||||||||||
Noninterest-earning assets | 479,235 | 471,600 | ||||||||||||||||||||||||||||||||||||
Total assets | $ | 9,288,937 | $ | 9,601,159 | ||||||||||||||||||||||||||||||||||
Liabilities and shareholder’s equity: | ||||||||||||||||||||||||||||||||||||||
Savings | $ | 2,674,087 | $ | 1,354 | 0.20 | $ | 3,006,949 | $ | 313 | 0.04 | ||||||||||||||||||||||||||||
Interest-bearing checking | 1,392,408 | 2,937 | 0.85 | 1,298,399 | 769 | 0.24 | ||||||||||||||||||||||||||||||||
Money market | 391,780 | 3,788 | 3.88 | 268,744 | 1,738 | 2.59 | ||||||||||||||||||||||||||||||||
Time certificates | 1,030,314 | 9,936 | 3.87 | 816,772 | 6,841 | 3.36 | ||||||||||||||||||||||||||||||||
Total interest-bearing deposits | 5,488,589 | 18,015 | 1.32 | 5,390,864 | 9,661 | 0.72 | ||||||||||||||||||||||||||||||||
Advances from Federal Home Loan Bank | 529,670 | 6,479 | 4.84 | 141,506 | 1,605 | 4.49 | ||||||||||||||||||||||||||||||||
Borrowings from Federal Reserve Bank | — | — | — | 567,857 | 6,207 | 4.38 | ||||||||||||||||||||||||||||||||
Securities sold under agreements to repurchase and federal funds purchased | — | — | — | 105,691 | 1,040 | 3.95 | ||||||||||||||||||||||||||||||||
Total interest-bearing liabilities | 6,018,259 | 24,494 | 1.63 | 6,205,918 | 18,513 | 1.20 | ||||||||||||||||||||||||||||||||
Noninterest bearing liabilities: | ||||||||||||||||||||||||||||||||||||||
Deposits | 2,508,658 | 2,685,828 | ||||||||||||||||||||||||||||||||||||
Other | 222,876 | 210,698 | ||||||||||||||||||||||||||||||||||||
Shareholder’s equity | 539,144 | 498,715 | ||||||||||||||||||||||||||||||||||||
Total liabilities and shareholder’s equity | $ | 9,288,937 | $ | 9,601,159 | ||||||||||||||||||||||||||||||||||
Net interest income | $ | 62,018 | $ | 63,477 | ||||||||||||||||||||||||||||||||||
Net interest margin (%) 4 | 2.79 | 2.75 |
Six months ended June 30 | ||||||||||||||||||||||||||||||||||||||
2024 | 2023 | |||||||||||||||||||||||||||||||||||||
(dollars in thousands) | Average balance | Interest income/ expense | Yield/ rate (%) | Average balance | Interest income/ expense | Yield/ rate (%) | ||||||||||||||||||||||||||||||||
Assets: | ||||||||||||||||||||||||||||||||||||||
Interest-earning deposits | $ | 157,466 | $ | 4,296 | 5.40 | $ | 23,626 | $ | 609 | 5.13 | ||||||||||||||||||||||||||||
FHLB stock | 23,521 | 1,010 | 8.64 | 22,835 | 663 | 5.85 | ||||||||||||||||||||||||||||||||
Investment securities | ||||||||||||||||||||||||||||||||||||||
Taxable | 2,620,463 | 22,060 | 1.68 | 3,015,220 | 26,341 | 1.75 | ||||||||||||||||||||||||||||||||
Non-taxable | 66,668 | 1,033 | 3.08 | 68,094 | 1,011 | 2.96 | ||||||||||||||||||||||||||||||||
Total investment securities | 2,687,131 | 23,093 | 1.72 | 3,083,314 | 27,352 | 1.77 | ||||||||||||||||||||||||||||||||
Loans | ||||||||||||||||||||||||||||||||||||||
Residential 1-4 family | 2,610,172 | 51,084 | 3.91 | 2,502,551 | 45,726 | 3.65 | ||||||||||||||||||||||||||||||||
Commercial real estate | 1,547,233 | 40,642 | 5.21 | 1,471,079 | 35,620 | 4.83 | ||||||||||||||||||||||||||||||||
Home equity line of credit | 1,000,665 | 21,844 | 4.39 | 1,028,076 | 18,685 | 3.67 | ||||||||||||||||||||||||||||||||
Residential land | 18,811 | 564 | 6.00 | 20,266 | 546 | 5.39 | ||||||||||||||||||||||||||||||||
Commercial | 705,433 | 20,998 | 5.94 | 780,859 | 21,251 | 5.45 | ||||||||||||||||||||||||||||||||
Consumer | 237,686 | 11,248 | 9.50 | 252,883 | 11,236 | 8.94 | ||||||||||||||||||||||||||||||||
Total loans 1,2 | 6,120,000 | 146,380 | 4.78 | 6,055,714 | 133,064 | 4.40 | ||||||||||||||||||||||||||||||||
Total interest-earning assets 3 | 8,988,118 | 174,779 | 3.88 | 9,185,489 | 161,688 | 3.52 | ||||||||||||||||||||||||||||||||
Allowance for credit losses | (72,480) | (71,649) | ||||||||||||||||||||||||||||||||||||
Noninterest-earning assets | 489,041 | 468,958 | ||||||||||||||||||||||||||||||||||||
Total assets | $ | 9,404,679 | $ | 9,582,798 | ||||||||||||||||||||||||||||||||||
Liabilities and shareholder’s equity: | ||||||||||||||||||||||||||||||||||||||
Savings | $ | 2,699,446 | $ | 2,482 | 0.18 | $ | 3,074,650 | $ | 535 | 0.04 | ||||||||||||||||||||||||||||
Interest-bearing checking | 1,395,090 | 6,053 | 0.87 | 1,315,213 | 1,399 | 0.21 | ||||||||||||||||||||||||||||||||
Money market | 352,588 | 6,609 | 3.76 | 233,083 | 2,324 | 2.01 | ||||||||||||||||||||||||||||||||
Time certificates | 1,042,747 | 20,303 | 3.90 | 778,441 | 12,240 | 3.17 | ||||||||||||||||||||||||||||||||
Total interest-bearing deposits | 5,489,871 | 35,447 | 1.29 | 5,401,387 | 16,498 | 0.62 | ||||||||||||||||||||||||||||||||
Advances from Federal Home Loan Bank | 394,538 | 9,440 | 4.73 | 320,867 | 7,475 | 4.63 | ||||||||||||||||||||||||||||||||
Borrowings from Federal Reserve Bank | 238,187 | 5,193 | 4.37 | 318,674 | 6,926 | 4.38 | ||||||||||||||||||||||||||||||||
Securities sold under agreements to repurchase | — | — | — | 125,917 | 2,172 | 3.48 | ||||||||||||||||||||||||||||||||
Total interest-bearing liabilities | 6,122,596 | 50,080 | 1.64 | 6,166,845 | 33,071 | 1.08 | ||||||||||||||||||||||||||||||||
Noninterest bearing liabilities: | ||||||||||||||||||||||||||||||||||||||
Deposits | 2,511,954 | 2,715,408 | ||||||||||||||||||||||||||||||||||||
Other | 232,899 | 211,852 | ||||||||||||||||||||||||||||||||||||
Shareholder’s equity | 537,230 | 488,693 | ||||||||||||||||||||||||||||||||||||
Total liabilities and shareholder’s equity | $ | 9,404,679 | $ | 9,582,798 | ||||||||||||||||||||||||||||||||||
Net interest income | $ | 124,699 | $ | 128,617 | ||||||||||||||||||||||||||||||||||
Net interest margin (%) 4 | 2.77 | 2.80 |
June 30, 2024 | December 31, 2023 | |||||||||||||||||||||||||
(dollars in thousands) | Balance | % of total | Balance | % of total | ||||||||||||||||||||||
U.S. Treasury and federal agency obligations | $ | 68,812 | 3 | % | $ | 71,927 | 3 | % | ||||||||||||||||||
Mortgage-backed securities — issued or guaranteed by U.S. Government agencies or sponsored agencies | 2,125,054 | 95 | 2,218,565 | 95 | ||||||||||||||||||||||
Corporate bonds | 32,927 | 1 | 32,903 | 1 | ||||||||||||||||||||||
Mortgage revenue bonds | 14,076 | 1 | 14,358 | 1 | ||||||||||||||||||||||
Total investment securities | $ | 2,240,869 | 100 | % | $ | 2,337,753 | 100 | % |
Six months ended June 30 | Year ended December 31, 2023 | |||||||||||||||||||
(in thousands) | 2024 | 2023 | ||||||||||||||||||
Allowance for credit losses, beginning of period | $ | 74,372 | $ | 72,216 | $ | 72,216 | ||||||||||||||
Provision for credit losses | (3,169) | 1,018 | 9,657 | |||||||||||||||||
Less: net charge-offs | 4,390 | 4,166 | 7,501 | |||||||||||||||||
Allowance for credit losses, end of period | $ | 66,813 | $ | 69,068 | $ | 74,372 | ||||||||||||||
Ratio of net charge-offs during the period to average loans outstanding (annualized) | 0.14 | % | 0.14 | % | 0.12 | % |
(dollars in millions) | June 30, 2024 | December 31, 2023 | % change | |||||||||||||||||
Total assets | $ | 9,281 | $ | 9,673 | (4) | |||||||||||||||
Investment securities | 2,241 | 2,338 | (4) | |||||||||||||||||
Loans held for investment, net | 5,963 | 6,106 | (2) | |||||||||||||||||
Deposit liabilities | 8,036 | 8,146 | (1) | |||||||||||||||||
Other bank borrowings | 520 | 750 | (31) |
Change in interest rates | Change in NII (gradual change in interest rates) | Change in EVE (instantaneous change in interest rates) | ||||||||||||||||||||||||
(basis points) | June 30, 2024 | December 31, 2023 | June 30, 2024 | December 31, 2023 | ||||||||||||||||||||||
+300 | 0.3 | % | 2.1 | % | 2.2 | % | 2.7 | % | ||||||||||||||||||
+200 | 0.2 | 1.4 | 1.9 | 2.5 | ||||||||||||||||||||||
+100 | 0.1 | 0.7 | 1.5 | 1.7 | ||||||||||||||||||||||
-100 | (0.4) | (1.0) | (2.2) | (2.3) | ||||||||||||||||||||||
-200 | (1.0) | (2.2) | (5.2) | (5.4) | ||||||||||||||||||||||
-300 | (1.6) | (3.5) | (9.2) | (10.3) |
Period* | Total Number of Shares Purchased ** | Average Price Paid per Share ** | Total Number of Shares Purchased as Part of Publicly Announced Plans or Programs | Maximum Number (or Approximate Dollar Value) of Shares that May Yet Be Purchased Under the Plans or Programs | ||||||||||||||||||||||
April 1 to 30, 2024 | 40,583 | $10.49 | — | NA | ||||||||||||||||||||||
May 1 to 31, 2024 | 26,747 | $10.64 | — | NA | ||||||||||||||||||||||
June 1 to 30, 2024 | 36,733 | $9.87 | — | NA |
Certification Pursuant to Rule 13a-14 promulgated under the Securities Exchange Act of 1934 of Scott W. H. Seu (HEI Chief Executive Officer) | ||||||||
Certification Pursuant to Rule 13a-14 promulgated under the Securities Exchange Act of 1934 of Scott T. DeGhetto (HEI Chief Financial Officer) | ||||||||
HEI Certification Pursuant to 18 U.S.C. Section 1350 | ||||||||
HEI Exhibit 101.INS | XBRL Instance Document - the instance document does not appear on the Interactive Data File because its XBRL tags are embedded within the Inline XBRL document | |||||||
HEI Exhibit 101.SCH | Inline XBRL Taxonomy Extension Schema Document | |||||||
HEI Exhibit 101.CAL | Inline XBRL Taxonomy Extension Calculation Linkbase Document | |||||||
HEI Exhibit 101.DEF | Inline XBRL Taxonomy Extension Definition Linkbase Document | |||||||
HEI Exhibit 101.LAB | Inline XBRL Taxonomy Extension Label Linkbase Document | |||||||
HEI Exhibit 101.PRE | Inline XBRL Taxonomy Extension Presentation Linkbase Document | |||||||
HEI Exhibit 104 | Cover Page Interactive Data File (formatted as Inline XBRL and contained in Exhibit 101) | |||||||
ABL Credit Agreement, dated May 17, 2024, among HE AR BRWR LLC, as Borrower, the Lenders (as defined in the agreement), Barclays Bank PLC, as Administrative Agent, Funding Agent and Collateral Agent, Wells Fargo Bank, National Association as Co-Collateral Agent (incorporated by reference to Exhibit 10.1 to HEI’s Current Report on Form 8-K dated May 17, 2024, File no. 1-8503) | ||||||||
Purchase and Contribution Agreement among Hawaiian Electric Company, Inc., Maui Electric Company, Limited, and Hawaii Electric Light Company, Inc, as Originators, Hawaiian Electric Company, Inc., as Servicer, and HE AR INTER LLC, as Buyer, dated May 17, 2024 (incorporated by reference to Exhibit 10.2 to HEI’s Current Report on Form 8-K dated May 17, 2024, File no. 1-8503) | ||||||||
Borrower Purchase and Contribution Agreement among HE AR INTER LLC, as Seller, Hawaiian Electric Company, Inc., as Servicer, and HE AR BRWR LLC, as Buyer, dated May 17, 2024 (incorporated by reference to Exhibit 10.3 to HEI’s Current Report on Form 8-K dated May 17, 2024, File no. 1-8503) | ||||||||
Certification Pursuant to Rule 13a-14 promulgated under the Securities Exchange Act of 1934 of Shelee M. T. Kimura (Hawaiian Electric Chief Executive Officer) | ||||||||
Certification Pursuant to Rule 13a-14 promulgated under the Securities Exchange Act of 1934 of Paul K. Ito (Hawaiian Electric Chief Financial Officer) | ||||||||
Hawaiian Electric Certification Pursuant to 18 U.S.C. Section 1350 |
HAWAIIAN ELECTRIC INDUSTRIES, INC. | HAWAIIAN ELECTRIC COMPANY, INC. | |||||||||||||
(Registrant) | (Registrant) | |||||||||||||
By | /s/ Scott W. H. Seu | By | /s/ Shelee M. T. Kimura | |||||||||||
Scott W. H. Seu | Shelee M. T. Kimura | |||||||||||||
President and Chief Executive Officer | President and Chief Executive Officer | |||||||||||||
(Principal Executive Officer of HEI) | (Principal Executive Officer of Hawaiian Electric) | |||||||||||||
By | /s/ Scott T. DeGhetto | By | /s/ Paul K. Ito | |||||||||||
Scott T. DeGhetto | Paul K. Ito | |||||||||||||
Executive Vice President, | Senior Vice President, | |||||||||||||
Chief Financial Officer and Treasurer | Chief Financial Officer and Treasurer | |||||||||||||
(Principal Financial Officer of HEI) | (Principal Financial Officer of Hawaiian Electric) | |||||||||||||
Date: August 9, 2024 | Date: August 9, 2024 |
Date: August 9, 2024 | |||||
/s/ Scott W. H. Seu | |||||
Scott W. H. Seu | |||||
President and Chief Executive Officer |
Date: August 9, 2024 | |||||
/s/ Scott T. DeGhetto | |||||
Scott T. DeGhetto | |||||
Executive Vice President, Chief Financial Officer | |||||
and Treasurer |
Date: August 9, 2024 | |||||
/s/ Shelee M. T. Kimura | |||||
Shelee M. T. Kimura | |||||
President and Chief Executive Officer |
Date: August 9, 2024 | |||||
/s/ Paul K. Ito | |||||
Paul K. Ito | |||||
Senior Vice President, Chief Financial Officer and Treasurer |
Date: August 9, 2024 | ||
/s/ Scott W. H. Seu | ||
Scott W. H. Seu | ||
President and Chief Executive Officer | ||
/s/ Scott T. DeGhetto | ||
Scott T. DeGhetto | ||
Executive Vice President, Chief Financial Officer and Treasurer | ||
Date: August 9, 2024 | ||
/s/ Shelee M. T. Kimura | ||
Shelee M. T. Kimura | ||
President and Chief Executive Officer | ||
/s/ Paul K. Ito | ||
Paul K. Ito | ||
Senior Vice President, Chief Financial Officer and Treasurer |
Condensed Consolidated Statements of Income (unaudited) - USD ($) shares in Thousands, $ in Thousands |
3 Months Ended | 6 Months Ended | ||
---|---|---|---|---|
Jun. 30, 2024 |
Jun. 30, 2023 |
Jun. 30, 2024 |
Jun. 30, 2023 |
|
Revenues | ||||
Revenues | $ 897,360 | $ 895,685 | $ 1,794,518 | $ 1,823,922 |
Expenses | ||||
Total expenses | 2,616,335 | 802,706 | 3,437,074 | 1,637,425 |
Operating income (loss) | ||||
Total operating income (loss) | (1,718,975) | 92,979 | (1,642,556) | 186,497 |
Retirement defined benefits credit—other than service costs | 1,281 | 1,153 | 2,563 | 2,305 |
Interest expense, net—other than on deposit liabilities and other bank borrowings | (32,400) | (29,832) | (63,991) | (58,630) |
Allowance for borrowed funds used during construction | 1,344 | 1,295 | 2,730 | 2,426 |
Allowance for equity funds used during construction | 3,336 | 3,772 | 6,976 | 7,073 |
Interest income | 3,134 | 0 | 6,267 | 0 |
Loss before income taxes | (1,742,280) | 69,367 | (1,688,011) | 139,671 |
Income tax expense (benefit) | (447,269) | 14,284 | (435,595) | 29,394 |
Net income (loss) | (1,295,011) | 55,083 | (1,252,416) | 110,277 |
Preferred stock dividends of subsidiaries | 473 | 473 | 946 | 946 |
Net income (loss) for common stock | $ (1,295,484) | $ 54,610 | $ (1,253,362) | $ 109,331 |
Basic earnings (loss) per common share (in dollars per share) | $ (11.74) | $ 0.50 | $ (11.37) | $ 1.00 |
Diluted earnings (loss) per common share (in dollars per share) | $ (11.74) | $ 0.50 | $ (11.37) | $ 1.00 |
Weighted-average number of common shares outstanding: | ||||
Basic (in shares) | 110,303 | 109,573 | 110,260 | 109,544 |
Diluted (in shares) | 110,303 | 109,780 | 110,260 | 109,870 |
Electric utility | ||||
Revenues | ||||
Revenues | $ 792,331 | $ 794,191 | $ 1,580,909 | $ 1,624,552 |
Expenses | ||||
Total expenses | 2,436,771 | 720,566 | 3,161,994 | 1,475,052 |
Operating income (loss) | ||||
Total operating income (loss) | (1,644,440) | 73,625 | (1,581,085) | 149,500 |
Loss before income taxes | (1,658,653) | 58,868 | (1,607,753) | 119,976 |
Income tax expense (benefit) | (429,758) | 13,070 | (418,578) | 26,670 |
Net income (loss) | (1,228,895) | 45,798 | (1,189,175) | 93,306 |
Preferred stock dividends of subsidiaries | 499 | 499 | 998 | 998 |
Net income (loss) for common stock | (1,229,394) | 45,299 | (1,190,173) | 92,308 |
Bank | ||||
Revenues | ||||
Revenues | 101,943 | 96,885 | 207,087 | 190,742 |
Expenses | ||||
Total expenses | 159,329 | 72,017 | 238,941 | 142,354 |
Operating income (loss) | ||||
Total operating income (loss) | (57,386) | 24,868 | (31,854) | 48,388 |
Loss before income taxes | (57,106) | 25,055 | (31,293) | 48,762 |
Income tax expense (benefit) | (11,319) | 4,851 | (6,440) | 9,996 |
Net income (loss) | (45,787) | 20,204 | (24,853) | 38,766 |
Preferred stock dividends of subsidiaries | 0 | 0 | 0 | 0 |
Net income (loss) for common stock | (45,787) | 20,204 | (24,853) | 38,766 |
Other | ||||
Revenues | ||||
Revenues | 3,086 | 4,609 | 6,522 | 8,628 |
Expenses | ||||
Total expenses | 20,235 | 10,123 | 36,139 | 20,019 |
Operating income (loss) | ||||
Total operating income (loss) | (17,149) | (5,514) | (29,617) | (11,391) |
Loss before income taxes | (26,521) | (14,556) | (48,965) | (29,067) |
Income tax expense (benefit) | (6,192) | (3,637) | (10,577) | (7,272) |
Net income (loss) | (20,329) | (10,919) | (38,388) | (21,795) |
Preferred stock dividends of subsidiaries | (26) | (26) | (52) | (52) |
Net income (loss) for common stock | $ (20,303) | $ (10,893) | $ (38,336) | $ (21,743) |
Condensed Consolidated Balance Sheets (Parenthetical) - USD ($) $ in Thousands |
Jun. 30, 2024 |
Dec. 31, 2023 |
---|---|---|
Assets | ||
Property, plant and equipment, accumulated depreciation | $ 3,415,729 | $ 3,317,759 |
Shareholders’ equity | ||
Preferred stock, no par value (in dollars per share) | $ 0 | $ 0 |
Preferred stock, authorized shares (in shares) | 10,000,000 | 10,000,000 |
Preferred stock, issued shares (in shares) | 0 | 0 |
Common stock, no par value (in dollars per share) | $ 0 | $ 0 |
Common stock, authorized shares (in shares) | 200,000,000 | 200,000,000 |
Common stock, shares issued (in shares) | 110,303,446 | 110,151,798 |
Common stock, shares outstanding (in shares) | 110,303,446 | 110,151,798 |
Condensed Consolidated Statements of Changes in Shareholders' Equity (Parenthetical) - $ / shares |
3 Months Ended | |
---|---|---|
Jun. 30, 2023 |
Mar. 31, 2023 |
|
Statement of Stockholders' Equity [Abstract] | ||
Common stock dividends (in dollars per share) | $ 0.36 | $ 0.36 |
Condensed Consolidated Statements of Income (unaudited) - HECO - USD ($) $ in Thousands |
3 Months Ended | 6 Months Ended | ||||
---|---|---|---|---|---|---|
Jun. 30, 2024 |
Mar. 31, 2024 |
Jun. 30, 2023 |
Mar. 31, 2023 |
Jun. 30, 2024 |
Jun. 30, 2023 |
|
Revenues | ||||||
Revenues | $ 897,360 | $ 895,685 | $ 1,794,518 | $ 1,823,922 | ||
Expenses | ||||||
Total expenses | 2,616,335 | 802,706 | 3,437,074 | 1,637,425 | ||
Total operating income (loss) | (1,718,975) | 92,979 | (1,642,556) | 186,497 | ||
Allowance for equity funds used during construction | 3,336 | 3,772 | 6,976 | 7,073 | ||
Retirement defined benefits credit—other than service costs | 1,281 | 1,153 | 2,563 | 2,305 | ||
Allowance for borrowed funds used during construction | 1,344 | 1,295 | 2,730 | 2,426 | ||
Interest income | 3,134 | 0 | 6,267 | 0 | ||
Loss before income taxes | (1,742,280) | 69,367 | (1,688,011) | 139,671 | ||
Income tax expense (benefit) | (447,269) | 14,284 | (435,595) | 29,394 | ||
Net income (loss) | (1,295,011) | 55,083 | (1,252,416) | 110,277 | ||
Preferred stock dividends of Hawaiian Electric | 473 | 473 | 946 | 946 | ||
Net income (loss) for common stock | (1,295,484) | $ 42,122 | 54,610 | $ 54,721 | (1,253,362) | 109,331 |
Hawaiian Electric Company, Inc. and Subsidiaries | ||||||
Revenues | ||||||
Revenues | 792,331 | 794,191 | 1,580,909 | 1,624,552 | ||
Expenses | ||||||
Fuel oil | 258,652 | 280,157 | 542,948 | 614,254 | ||
Purchased power | 181,328 | 168,434 | 341,145 | 321,195 | ||
Other operation and maintenance | 147,561 | 136,360 | 291,451 | 264,676 | ||
Wildfire tort-related claims | 1,712,000 | 0 | 1,712,000 | 0 | ||
Depreciation | 62,812 | 60,689 | 125,624 | 121,616 | ||
Taxes, other than income taxes | 74,418 | 74,926 | 148,826 | 153,311 | ||
Total expenses | 2,436,771 | 720,566 | 3,161,994 | 1,475,052 | ||
Total operating income (loss) | (1,644,440) | 73,625 | (1,581,085) | 149,500 | ||
Allowance for equity funds used during construction | 3,336 | 3,772 | 6,976 | 7,073 | ||
Retirement defined benefits credit—other than service costs | 1,072 | 1,048 | 2,144 | 2,095 | ||
Interest expense and other charges, net | (21,417) | (20,872) | (41,402) | (41,118) | ||
Allowance for borrowed funds used during construction | 1,344 | 1,295 | 2,730 | 2,426 | ||
Interest income | 1,452 | 0 | 2,884 | 0 | ||
Loss before income taxes | (1,658,653) | 58,868 | (1,607,753) | 119,976 | ||
Income tax expense (benefit) | (429,758) | 13,070 | (418,578) | 26,670 | ||
Net income (loss) | (1,228,895) | 45,798 | (1,189,175) | 93,306 | ||
Preferred stock dividends of subsidiaries | 229 | 229 | 458 | 458 | ||
Net income (loss) | (1,229,124) | 45,569 | (1,189,633) | 92,848 | ||
Preferred stock dividends of Hawaiian Electric | 270 | 270 | 540 | 540 | ||
Net income (loss) for common stock | $ (1,229,394) | $ 39,221 | $ 45,299 | $ 47,009 | $ (1,190,173) | $ 92,308 |
Condensed Consolidated Statements of Comprehensive Income (unaudited) - HECO (Parenthetical) - USD ($) $ in Thousands |
3 Months Ended | 6 Months Ended | ||
---|---|---|---|---|
Jun. 30, 2024 |
Jun. 30, 2023 |
Jun. 30, 2024 |
Jun. 30, 2023 |
|
Retirement benefit plans: | ||||
Adjustment for amortization of prior service credit and net losses recognized during the period in net periodic benefit cost, tax | $ (155) | $ (122) | $ (309) | $ (244) |
Reclassification adjustment for impact of D&Os of the PUC included in regulatory assets, tax | 160 | 148 | 319 | 295 |
Hawaiian Electric Company, Inc. and Subsidiaries | ||||
Retirement benefit plans: | ||||
Adjustment for amortization of prior service credit and net losses recognized during the period in net periodic benefit cost, tax | (175) | (163) | (351) | (326) |
Reclassification adjustment for impact of D&Os of the PUC included in regulatory assets, tax | $ 160 | $ 148 | $ 319 | $ 295 |
Condensed Consolidated Balance Sheets (unaudited) - HECO (parenthetical) - USD ($) $ in Thousands |
Jun. 30, 2024 |
Dec. 31, 2023 |
---|---|---|
Shareholders’ equity | ||
Common stock, authorized shares (in shares) | 200,000,000 | 200,000,000 |
Common stock, shares outstanding (in shares) | 110,303,446 | 110,151,798 |
Hawaiian Electric Company, Inc. and Subsidiaries | ||
Utility property, plant and equipment | ||
Accumulated depreciation on other property, plant and equipment | $ 42 | $ 40 |
Shareholders’ equity | ||
Common stock, par value (in dollars per share) | $ 6.67 | $ 6.67 |
Common stock, authorized shares (in shares) | 50,000,000 | 50,000,000 |
Common stock, shares outstanding (in shares) | 17,854,278 | 17,854,278 |
Condensed Consolidated Statements of Changes in Common Stock Equity (unaudited) - HECO - USD ($) $ in Thousands |
Total |
Hawaiian Electric Company, Inc. and Subsidiaries |
Common stock |
Common stock
Hawaiian Electric Company, Inc. and Subsidiaries
|
Premium on capital stock
Hawaiian Electric Company, Inc. and Subsidiaries
|
Retained earnings |
Retained earnings
Hawaiian Electric Company, Inc. and Subsidiaries
|
Accumulated other comprehensive income (loss) |
Accumulated other comprehensive income (loss)
Hawaiian Electric Company, Inc. and Subsidiaries
|
---|---|---|---|---|---|---|---|---|---|
Beginning balance (in shares) at Dec. 31, 2022 | 109,471,000 | 17,854,000 | |||||||
Beginning balance at Dec. 31, 2022 | $ 2,202,499 | $ 2,344,170 | $ 1,692,697 | $ 119,048 | $ 810,955 | $ 845,830 | $ 1,411,306 | $ (336,028) | $ 2,861 |
Increase (decrease) in stockholders' equity | |||||||||
Net income (loss) for common stock | 54,721 | 47,009 | 54,721 | 47,009 | |||||
Other comprehensive (loss) income, net of tax benefits | 20,488 | (45) | 20,488 | (45) | |||||
Common stock dividends | (39,446) | (32,250) | (39,446) | (32,250) | |||||
Ending balance (in shares) at Mar. 31, 2023 | 109,572,000 | 17,854,000 | |||||||
Ending balance at Mar. 31, 2023 | 2,237,955 | 2,358,884 | $ 1,692,390 | $ 119,048 | 810,955 | 861,105 | 1,426,065 | (315,540) | 2,816 |
Beginning balance (in shares) at Dec. 31, 2022 | 109,471,000 | 17,854,000 | |||||||
Beginning balance at Dec. 31, 2022 | 2,202,499 | 2,344,170 | $ 1,692,697 | $ 119,048 | 810,955 | 845,830 | 1,411,306 | (336,028) | 2,861 |
Increase (decrease) in stockholders' equity | |||||||||
Net income (loss) for common stock | 109,331 | 92,308 | |||||||
Other comprehensive (loss) income, net of tax benefits | 12,879 | (89) | |||||||
Common stock dividends | (64,500) | ||||||||
Ending balance (in shares) at Jun. 30, 2023 | 109,612,000 | 17,854,000 | |||||||
Ending balance at Jun. 30, 2023 | 2,249,377 | 2,371,889 | $ 1,696,258 | $ 119,048 | 810,955 | 876,268 | 1,439,114 | (323,149) | 2,772 |
Beginning balance (in shares) at Mar. 31, 2023 | 109,572,000 | 17,854,000 | |||||||
Beginning balance at Mar. 31, 2023 | 2,237,955 | 2,358,884 | $ 1,692,390 | $ 119,048 | 810,955 | 861,105 | 1,426,065 | (315,540) | 2,816 |
Increase (decrease) in stockholders' equity | |||||||||
Net income (loss) for common stock | 54,610 | 45,299 | 54,610 | 45,299 | |||||
Other comprehensive (loss) income, net of tax benefits | (7,609) | (44) | (7,609) | (44) | |||||
Common stock dividends | (39,447) | (32,250) | (39,447) | (32,250) | |||||
Ending balance (in shares) at Jun. 30, 2023 | 109,612,000 | 17,854,000 | |||||||
Ending balance at Jun. 30, 2023 | $ 2,249,377 | 2,371,889 | $ 1,696,258 | $ 119,048 | 810,955 | 876,268 | 1,439,114 | (323,149) | 2,772 |
Beginning balance (in shares) at Dec. 31, 2023 | 110,151,798 | 110,152,000 | 17,854,000 | ||||||
Beginning balance at Dec. 31, 2023 | $ 2,344,841 | 2,409,110 | $ 1,707,471 | $ 119,048 | 810,955 | 926,720 | 1,476,258 | (289,350) | 2,849 |
Increase (decrease) in stockholders' equity | |||||||||
Net income (loss) for common stock | 42,122 | 39,221 | 42,122 | 39,221 | |||||
Other comprehensive (loss) income, net of tax benefits | (9,801) | (49) | (9,801) | (49) | |||||
Common stock dividends | (13,000) | (13,000) | |||||||
Ending balance (in shares) at Mar. 31, 2024 | 110,303,000 | 17,854,000 | |||||||
Ending balance at Mar. 31, 2024 | $ 2,377,380 | 2,435,282 | $ 1,707,689 | $ 119,048 | 810,955 | 968,842 | 1,502,479 | (299,151) | 2,800 |
Beginning balance (in shares) at Dec. 31, 2023 | 110,151,798 | 110,152,000 | 17,854,000 | ||||||
Beginning balance at Dec. 31, 2023 | $ 2,344,841 | 2,409,110 | $ 1,707,471 | $ 119,048 | 810,955 | 926,720 | 1,476,258 | (289,350) | 2,849 |
Increase (decrease) in stockholders' equity | |||||||||
Net income (loss) for common stock | (1,253,362) | (1,190,173) | |||||||
Other comprehensive (loss) income, net of tax benefits | $ (8,207) | (95) | |||||||
Common stock dividends | (26,000) | ||||||||
Ending balance (in shares) at Jun. 30, 2024 | 110,303,446 | 110,303,000 | 17,854,000 | ||||||
Ending balance at Jun. 30, 2024 | $ 1,085,273 | 1,192,842 | $ 1,709,472 | $ 119,048 | 810,955 | (326,642) | 260,085 | (297,557) | 2,754 |
Beginning balance (in shares) at Mar. 31, 2024 | 110,303,000 | 17,854,000 | |||||||
Beginning balance at Mar. 31, 2024 | 2,377,380 | 2,435,282 | $ 1,707,689 | $ 119,048 | 810,955 | 968,842 | 1,502,479 | (299,151) | 2,800 |
Increase (decrease) in stockholders' equity | |||||||||
Net income (loss) for common stock | (1,295,484) | (1,229,394) | (1,295,484) | (1,229,394) | |||||
Other comprehensive (loss) income, net of tax benefits | $ 1,594 | (46) | 1,594 | (46) | |||||
Common stock dividends | (13,000) | (13,000) | |||||||
Ending balance (in shares) at Jun. 30, 2024 | 110,303,446 | 110,303,000 | 17,854,000 | ||||||
Ending balance at Jun. 30, 2024 | $ 1,085,273 | $ 1,192,842 | $ 1,709,472 | $ 119,048 | $ 810,955 | $ (326,642) | $ 260,085 | $ (297,557) | $ 2,754 |
Condensed Consolidated Statements of Income (unaudited) (Parenthetical) - USD ($) $ in Thousands |
3 Months Ended | 6 Months Ended |
---|---|---|
Jun. 30, 2024 |
Jun. 30, 2024 |
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Goodwill impairment | $ 82,190 | |
Electric utility | ||
Wildfire tort-related claims | $ 1,712,000 | 1,712,000 |
Bank | ||
Goodwill impairment | $ 82,000 | $ 82,000 |
Basis of presentation |
6 Months Ended |
---|---|
Jun. 30, 2024 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Basis of presentation | Basis of presentation The accompanying unaudited condensed consolidated financial statements have been prepared assuming that the Company will continue as a going concern and in conformity with accounting principles generally accepted in the United States of America (GAAP) for interim financial information, the instructions to SEC Form 10-Q and Article 10 of Regulation S-X. Accordingly, they do not include all of the information and footnotes required by GAAP for complete financial statements. In preparing the unaudited condensed consolidated financial statements, management is required to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the balance sheet and the reported amounts of revenues and expenses for the period. Actual results could differ significantly from those estimates. The accompanying unaudited condensed consolidated financial statements and the following notes should be read in conjunction with the audited consolidated financial statements and the notes thereto in HEI’s and Hawaiian Electric’s Form 10-K for the year ended December 31, 2023. In the opinion of HEI’s and Hawaiian Electric’s management, the accompanying unaudited condensed consolidated financial statements contain all material adjustments required by GAAP to fairly state consolidated HEI’s and Hawaiian Electric’s financial positions as of June 30, 2024 and December 31, 2023, the results of their operations for the three and six months ended June 30, 2024 and 2023, and cash flows for the six months ended June 30, 2024 and 2023. All such adjustments are of a normal recurring nature, unless otherwise disclosed below or in other referenced material. Results of operations for interim periods are not necessarily indicative of results for the full year. For the three and six months ended June 30, 2024, the Company incurred net losses of approximately $1.30 billion and $1.25 billion, respectively. For the three and six months ended June 30, 2024, the Utilities incurred net losses of approximately $1.23 billion and $1.19 billion, respectively. The net losses were primarily due to the accrual of estimated wildfire liabilities totaling approximately $1.71 billion related to the Maui windstorm and wildfire tort-related legal claims (see Note 2). When preparing financial statements for each annual and interim reporting period, management has the responsibility to evaluate whether there are conditions or events, considered in the aggregate, that raise substantial doubt about the Company’s ability to continue as a going concern within one year after the date that the financial statements are issued. In making its evaluation, the Company considers, among other things, risks and/or uncertainties related to its results of operations, contractual obligations, including near-term debt maturities, dividend requirements, debt covenant compliance, or other factors impacting the Company’s liquidity and capital resources. As of the date of filing of this Form 10-Q, management has not yet implemented a capital financing plan to address expected wildfire settlement payments. If the conditions resulting in the substantial doubt are not resolved prior to the issuance of the Company’s annual financial statements, or it is not yet probable that management's plans can be effectively implemented to address those conditions, the Company would be in default on certain terms of its taxable debt agreements and syndicated credit facility agreements, and lenders would have the option to call the outstanding debt. Management believes HEI’s and the Utilities’ current cash balance at June 30, 2024 of $124.4 million and $88.6 million, respectively, and available capacity on the asset-based lending facility (ABL Facility) would not be sufficient to fund the Company’s planned expenditures and operational needs, which include potential payments to settle wildfire claims. These conditions raise substantial doubt about HEI’s and the Utilities’ ability to continue as a going concern within one year after the date that financial statements are issued. The ability to continue as a going concern is dependent primarily upon the Company’s ability to raise the capital necessary to fund the contribution to the settlement of wildfire tort claims while also meeting their obligations to repay their liabilities arising from normal business operations when they become due. The accompanying consolidated financial statements have been prepared on a basis which assumes HEI and the Utilities are a going concern and do not include any adjustments to reflect the possible future effects on the recoverability and classification of assets or the amounts and classifications of liabilities that may result from any uncertainty related to HEI’s and the Utilities’ ability to continue as a going concern. Such adjustments could be material. HEI and the Utilities are currently working with their financial advisors on a financing plan to raise the capital necessary to fund the contribution to the settlement of wildfire tort claims. The Company expects to finance the settlement payments over time through a mix of debt, common equity, equity-linked securities or other potential options. While management believes the Company will be able to raise the necessary capital, there is no assurance that management’s plans will be successful. HEI’s and the Utilities’ future results of operations involve significant risks and uncertainties. Factors that could affect HEI’s and the Utilities’ future operating results and could cause actual results to vary materially from expectations include, but are not limited to, access to capital, ability to attract and retain key personnel, and pending or threatened litigation (including recent litigation noted above). Recent accounting pronouncements. Segment Reporting. In November 2023, the FASB issued ASU No. 2023-07, Segment Reporting (Topic 280): Improvements to Reportable Segment Disclosures to improve reportable segment disclosure requirements, primarily through enhanced disclosure requirements of significant segment expenses. These amendments are effective for annual periods beginning after December 15, 2023 and interim periods within fiscal years beginning after December 15, 2024. Early adoption is permitted. These amendments apply on a retrospective basis. The Company is currently evaluating the impact of this amendment on the Company’s consolidated financial statements. Income Taxes. In December 2023, the FASB issued ASU No. 2023-09, Income Taxes (Topic 740): Improvement to Income Tax Disclosures to enhance the transparency and decision usefulness of income tax disclosures. The amendments are effective for annual periods beginning after December 15, 2024. These amendments apply on a prospective basis with a retrospective option. Early adoption is permitted. The Company is currently evaluating the impact of this amendment on the Company’s consolidated financial statements. Climate-related disclosures. In March 2024, the Securities and Exchange Commission (SEC) issued final climate-related disclosure rules under SEC Release No. 33-11275, The Enhancement and Standardization of Climate-Related Disclosures for Investors (climate disclosure rules). The rules will require annual disclosure of material greenhouse gas emissions as well as disclosure of governance, risk management and strategy related to material climate-related risks. In addition, the rules require (i) financial statement impacts of severe weather events and other natural conditions; (ii) a roll forward of carbon offset and renewable energy credit balances if material to the Company’s plan to achieve climate-related targets or goals; and (iii) material impacts on estimates and assumptions in the financial statements. The disclosure requirements will begin phasing in for annual periods beginning with calendar year 2025. The Company is currently evaluating the final rule to determine its impact on the Company’s consolidated financial statements. In April 2024, the SEC voluntarily stayed implementation of its climate disclosure rules pending completion of judicial review by the Court of Appeals for the Eighth Circuit. Reclassifications. Reclassifications of prior year Wildfire tort-related claims amounts were reclassified from “Other liabilities” and “Other current liabilities” for the Company and the Utilities, respectively, to conform to the current year financial statement presentation. Reclassifications did not affect previously reported cash flows, net income or retained earnings.
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Maui windstorm and wildfires |
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Maui windstorm and wildfires | Maui windstorm and wildfires On August 8, 2023, a number of brush fires in the West Maui (Lahaina) and Upcountry Maui areas caused widespread property damage, including damage to property of the Utilities, and 102 confirmed fatalities in Lahaina (the Maui windstorm and wildfires). The Maui windstorm and wildfires were fueled by extreme winds and drought-like conditions in those parts of Maui. The circumstances surrounding the Maui windstorm and wildfires are currently the subject of several investigations. Restoration costs and recoveries. The Utilities are continuing restoration work to rebuild portions of the electric system in Lahaina to ensure safe and reliable power to all West Maui customers. Restoration efforts include the rebuilding of transmission and distribution lines along former routes in the Lahaina area with the installation of new interim steel poles and electrical equipment. To date, power has been restored to all customers that were able to have power restored in Lahaina and the rest of West Maui. On December 27, 2023, the Public Utilities Commission of the State of Hawaii (PUC) issued an order authorizing deferred accounting treatment for the Utilities’ incremental non-labor expenses related to the Maui windstorm and wildfires. The deferred accounting treatment applies to certain non-labor expenses incurred from August 8, 2023 through December 31, 2024 that are not already a part of the base rates. The approval pertains only to deferred cost treatment; any cost recovery of deferred costs will be the subject of a separate application(s). As of June 30, 2024, the Utilities have deferred $30.2 million of certain incremental costs related to the Maui windstorm and wildfires to a regulatory asset. While the Utilities plan to seek recovery of damage to covered electrical infrastructure under their property insurance programs, the timing and amount of any insurance recoveries are not determinable at this time and as such, an insurance receivable has not been recorded as of the date of this filing. The Company’s property insurance has a total policy limit of $500 million with a $1 million retention for damages related to Utility-owned non-generating assets, including overhead transmission and distribution assets within 1,000 feet of such assets. The Utilities believe capital expenditures related to restoration that are not covered by insurance will be managed under their current regulatory mechanisms, the recovery of which would be subject to PUC approval. ASB’s Lahaina branch, including most of its contents and automated teller machine, was destroyed in the fire. The Bank leased the property of its Lahaina location. Third-party claims and other proceedings. Tort-related legal claims. As of August 8, 2024, HEI and the Utilities have each been named in approximately 700 lawsuits related to the Maui windstorm and wildfires. These civil and class action lawsuits have been filed in the Maui and Oahu Circuit Courts against HEI, the Utilities, and other defendants, including the County of Maui, the State of Hawaii and related state entities, private landowners and developers, and telecommunications companies (collectively, tort-related legal claims). Two class actions are also pending in federal court. Most of these lawsuits allege that the defendants were responsible for, and/or negligent in failing to prevent or respond to the wildfires that led to the property destruction and loss of life. Other claims include, among other things, personal injury, wrongful death, emotional distress and inverse condemnation. One lawsuit asserting similar theories and claims was filed by the County of Maui against HEI and the Utilities, one lawsuit was filed by Spectrum Oceanic, LLC against HEI and the Utilities and other defendants, and other lawsuits were filed by approximately 160 subrogation insurers against HEI, the Utilities, a private landowner, and telecommunications companies. Additional lawsuits may be filed against the Company and other defendants in the future. The plaintiffs seek to recover damages and other costs, including punitive damages. Defendants have asserted cross-claims against one another for indemnification, contribution, and subrogation. Various unaffiliated third parties have published estimates of the total economic damage generally ranging from $3.8 billion to $6 billion. These estimates have not been validated by the Company, and they represent gross numbers that do not take into account causation or liability and do not attempt to allocate responsibility among the various defendants. As such, these estimates are not intended to provide a range of a reasonably possible loss in excess of the recorded amount under ASC Topic 450-20, “Loss Contingencies” attributable to the Company arising from the Maui windstorm and wildfires. In addition, on November 6, 2023, the Hawaii Insurance Division of the State of Hawaii Department of Commerce and Consumer Affairs released preliminary data on Maui windstorm and wildfires claims, and the Hawaii Insurance Division has subsequently provided updated data to include estimated losses for commercial property and business interruption. Through June 30, 2024, the data collected from over 200 insurers indicated estimated total insured losses of $3.3 billion for residential, commercial, personal, and other property, and business interruption. The estimated total losses for insured claims related to residential property includes homeowners insurance, dwelling-fire landlord, condominium unit owner, renters insurance, and other residential property. The estimated total losses do not account for uninsured or underinsured property losses, interest, attorneys’ fees, fire suppression and clean-up costs, evacuation costs, personal injury or wrongful death damages, medical expenses or other costs, such as potential punitive damages, fines or penalties. It is uncertain whether the insured claims reported to the Hawaii Insurance Division are complete, and together with property damage claims unaccounted for, as mentioned above, the total amount of property damage claims could be materially higher than the amount reported by the Hawaii Insurance Division. The Hawaii Insurance Division did not state whether it intends to provide updated information in the future. The Company is actively working with the State of Hawaii and others in the community on solutions for Maui’s recovery, including the compensation of those who suffered losses in the Maui windstorm and wildfires and who are currently named as plaintiffs in the various cases. On November 8, 2023, Hawaii Governor Josh Green announced the One ‘Ohana Initiative (the One ‘Ohana Initiative) as a collective path forward to recovery from the Maui windstorm and wildfires. The One ‘Ohana Initiative is a new humanitarian aid fund of $175 million, with the objective to compensate, in an expedited manner, those who have lost loved ones and those who have suffered severe injuries in the Maui windstorm and wildfires. The One ‘Ohana Initiative provides an alternative to a lengthy and expensive legal process. Beneficiaries who have lost loved ones are anticipated to receive payments of $1.5 million per decedent, and those who suffered severe injuries are expected to share in a specially allocated pool of compensation. In exchange for receiving such a payment, beneficiaries will be required to waive their ability to pursue legal claims for wrongful death and severe injuries. Hawaiian Electric fully supports this humanitarian initiative and has contributed $75 million. The Governor announced that other parties, including the State of Hawaii, the County of Maui, and Kamehameha Schools have all agreed to contribute to the fund. Hawaiian Electric’s contribution to the Initiative was less than half of the total, and Hawaiian Electric's insurance carriers funded its share of the contributions to the fund. Hawaiian Electric’s contribution is reflective of its commitment to join with community partners to provide solutions to promote Maui’s recovery. Hawaiian Electric’s commitment to contribute to the One ‘Ohana Initiative is not an admission of guilt or reflection of fault or liability related to the wildfires. Under the One ‘Ohana Initiative, all claimants (except families of missing persons) were required to submit a completed registration form and registrants who meet the Fund’s eligibility requirements then were required to complete and submit a claim form. As of the claim-submission deadline of July 15, 2024, 35 claim forms were received that relate to death claims and 12 claim forms were received that relate to physical injury claims. On August 2, 2024, attorneys representing the individual and class plaintiffs reached an agreement in principle with all defendants to settle all of their tort-related legal claims in the litigation arising out of the Maui windstorm and wildfires. The agreement in principle was the product of a mediation process that lasted several months and remains subject to final documentation and court approval. Under the agreement in principle, HEI and Hawaiian Electric, the State of Hawaii, the County of Maui, Kamehameha Schools, West Maui Land Co., Hawaiian Telcom and Spectrum/Charter Communications have agreed to contribute a total of approximately $4.04 billion to one or more funds that would pay the claims of those who filed lawsuits in state and federal courts, or who may have claims but have not yet filed lawsuits, in connection with the Maui windstorm and wildfires. The agreement in principle does not resolve claims with insurers who have asserted subrogation claims in separate lawsuits, and such insurers are not parties to the agreement in principle. However, the agreement in principle provides that the definitive settlement agreement must provide for resolution of all subrogation claims by insurers that have been or could be brought against defendants arising out of the Maui windstorm and wildfires for no additional consideration. The agreement in principle includes a condition to the defendants’ obligations providing that within 90 days from its execution, either (a) insurers that have brought claims arising out of the Maui windstorm and wildfires enter into a written agreement that provides for releases of all claims against the defendants, or (b) that a trial court enters an order providing that if the final definitive agreement between the plaintiffs and the defendants becomes effective, then those same insurers’ exclusive remedy for any claims against the defendants would be limited to asserting liens against the settlement amounts obtained by the individual plaintiffs (so long as the order becomes final and unappealable within nine months from its date of issuance or, in that time period, those same insurers agree to provide the requisite releases). Of the total settlement amount, HEI and Hawaiian Electric would contribute a total of $1.99 billion, which includes as a credit towards that amount the $75 million previously contributed for the One ‘Ohana Initiative, to be paid in four equal annual installments, with the first installment expected to be made no earlier than mid-2025. While the agreement in principle remains subject to final documentation and court approval, the Utilities have accrued their best estimate of the loss of approximately $1.71 billion, which represents the best estimate of the lump sum amount to settle claims with the plaintiffs as of June 30, 2024. The agreement in principle contains no admission of any liability by HEI or the Utilities and reflects the collective efforts of the State, HEI and the Utilities, and other defendants to seek a comprehensive resolution of the litigation arising out of the Maui windstorm and wildfires. The Utilities will seek insurance recovery to partially mitigate the potential financial impact; however, the timing and amount of any insurance recoveries are not determinable at this time. As part of the agreement in principle, the parties agreed to vacate all trial dates and stay the litigation, except for litigation activities between the individual plaintiffs and the subrogation insurers and actions taken to further settlement. On August 2, 2024, the Second Circuit court overseeing the Special Proceeding in which most of the individual plaintiff actions have been coordinated vacated the trial dates that previously had been set. Accordingly, no trial dates are currently set in any action. No stay of litigation has been agreed to in the subrogation actions, but no trial dates have been set in those actions. The Company intends to vigorously defend against the litigation if a definitive settlement is ultimately not achieved. There is no assurance that the Company will be successful in the defense of the litigation or that insurance will be available or adequate to fund any potential settlements, judgments, or costs associated with the litigation. If additional liabilities were to be incurred, the loss could be material to the Company’s results of operations, financial position and cash flows and could result in violations of the financial covenants in the Company’s debt agreements. If any such losses were to be sufficiently high, the Company may not have liquidity or the ability to access liquidity at levels necessary to satisfy such losses. However, any possible loss in excess of the amount recorded cannot reasonably be estimated at this time. Securities class action and shareholder lawsuits. On August 24, 2023, a putative securities class action captioned Bhangal v. Hawaiian Electric Industries, Inc., et al., No.: 3:23-cv-04332-JSC (the Securities Action) was filed in the United States District Court for the Northern District of California. The lawsuit alleges violations of the Securities Exchange Act of 1934 (the Exchange Act) and Rule 10b-5 promulgated thereunder against HEI and certain of its current and former officers (collectively, Defendants), and Section 20(a) of the Exchange Act against certain of HEI’s current and former officers. Plaintiff broadly alleges that Defendants made materially false and misleading statements or omissions regarding HEI’s wildfire prevention and safety protocols and related matters. Plaintiff seeks unspecified monetary damages. On December 7, 2023, the court appointed Daniel Warren as lead plaintiff and Pomerantz LLP as lead plaintiff’s counsel. On March 8, 2024, the lead plaintiff filed an amended complaint. The Company has filed a motion to dismiss that complaint and intends to vigorously defend against this action. There is no assurance that the Company will be successful in the defense of the litigation or that insurance will be available or adequate to fund any potential settlement or judgment or the litigation costs of the action. The Company does not believe that a loss is probable and any possible loss or range of loss is not reasonably estimable. On September 11, 2023, a putative shareholder derivative action captioned Rice v. Connors, et al., No. 1CCV-23-0001181 was filed in the Circuit Court of the First Circuit, State of Hawaii. On December 6, 2023, the case was removed to the United States District Court for the District of Hawaii and captioned Rice v. Connors, et al., No. 1:23-cv-00577-JAO-BMK. On March 14, 2024, the United States District Court remanded the case to the Circuit Court of the First Circuit, State of Hawaii. This action is purportedly brought by a shareholder on behalf of nominal defendants HEI and Hawaiian Electric against certain current and former officers and directors of HEI and Hawaiian Electric. Plaintiff asserts Hawaii state law breach of fiduciary duty, abuse of control, corporate waste, unjust enrichment, and aiding and abetting breach of fiduciary duty claims allegedly arising in connection with the Maui windstorm and wildfires that occurred in August 2023 and certain of the Company’s prior public disclosures. Plaintiff seeks, on behalf of HEI and Hawaiian Electric, compensatory and punitive damages, restitution, disgorgement, and equitable relief in the form of changes to corporate governance, policies and culture. HEI has moved to stay the proceeding pending resolution of the tort-related legal claims and the Securities Action. While the Company has obligations to indemnify and/or advance the defendants’ legal fees and costs in connection with this lawsuit, any monetary recovery in the derivative litigation should accrue to the Company. The Company is unable to predict the ultimate outcome and is unable to make a reasonable estimate of the amount or range of loss, if any, that could result from any unfavorable outcome. Three putative shareholder derivative actions were filed in the United States District Court for the Northern District of California between December 26, 2023 and February 8, 2024, including: Kallaus v. Johns, et al., No. 3:23-cv-06627 (the Kallaus Action), Cole v. Johns, et al., No. 3:24-cv-00598 (the Cole Action), and Tai v. Seu, et al., No. 3:24-cv-01198 (the Tai Action). On March 19, 2024, upon stipulation by the parties, the court consolidated the Kallaus Action, the Cole Action, and the Tai Action under the caption In Re Hawaiian Electric Industries, Inc. and Hawaiian Electric Company, Inc. Derivative Litigation, No. 3:23-cv-06627 (the Consolidated Derivative Actions). On June 19, 2024, Plaintiffs filed a consolidated amended complaint. The Consolidated Derivative Actions are purportedly brought by shareholders of HEI on behalf of nominal defendants HEI and Hawaiian Electric against certain current and former officers and directors of HEI and Hawaiian Electric. Plaintiffs purport to assert both Hawaii state law and federal securities law claims. Plaintiffs assert state law breach of fiduciary duty, corporate waste, unjust enrichment, gross mismanagement, and abuse of control claims purportedly arising in connection with the Maui windstorm and wildfires that occurred in August 2023 and certain public disclosures. Plaintiffs also assert claims under Section 10(b) of the Exchange Act, and Rule 10b-5 promulgated thereunder, and generally allege that the Company and certain of its current and former officers made materially false and misleading statements or omissions regarding the Company’s wildfire prevention and safety protocols and related matters. Plaintiffs seek, on behalf of HEI and Hawaiian Electric, unspecified monetary and punitive damages, disgorgement, and other relief. HEI moved to stay the Consolidated Derivative Actions pending resolution of the tort-related legal claims and the Securities Action, and also moved to dismiss the consolidated amended complaint for failing to adequately allege that the Board’s refusal of the plaintiffs’ demands was wrongful. While the Company has certain obligations to indemnify and/or advance the defendants’ legal fees and costs in connection with this lawsuit, any monetary recovery in the Consolidated Derivative Actions should accrue to the Company. The Company is unable to predict the ultimate outcome and is unable to make a reasonable estimate of the amount or range of loss, if any, that could result from any unfavorable outcome. Two putative shareholder derivative actions were filed in the United States District Court for the District of Hawaii between April 8, 2024 and June 8, 2024, including: Assad v. Seu, et al., No. 1:24-cv-00164 (the Assad Action), and Faris v. Seu, et al., No. 1:24-cv-00247 (the Faris Action). On July 3, 2024, upon stipulation by the parties, the court consolidated the Assad Action and Faris Action under the caption In Re Hawaiian Electric Industries, Inc., Stockholder Derivative Litigation, No. 1:24-cv-00164 (the Hawaii Federal Derivative Actions). Both actions are purportedly brought by shareholders on behalf of nominal defendant HEI and against certain current and former officers and directors of HEI and Hawaiian Electric. Plaintiffs purport to assert Hawaii state law claims for breach of fiduciary duty, corporate waste, and unjust enrichment allegedly arising in connection with the Maui windstorm and wildfires that occurred in August 2023 and certain public disclosures. Plaintiffs generally allege that the Company and certain of its current and former officers made materially false and misleading statements or omissions regarding the Company’s wildfire prevention and safety protocols and related matters. Plaintiffs seek, on behalf of HEI, compensatory damages, restitution, disgorgement, injunctive relief, and equitable relief, including in the form of changes to HEI’s corporate governance policies and procedures. On July 30, 2024, upon HEI’s motion, the court stayed the Hawaii Federal Derivative Actions pending resolution of the motion to dismiss the Securities Action and the motions to stay and dismiss the Consolidated Derivative Actions. While the Company has obligations to indemnify and/or advance the defendants’ legal fees and costs in connection with this lawsuit, any monetary recovery in the derivative litigation should accrue to the Company. The Company is unable to predict the ultimate outcome and is unable to make a reasonable estimate of the amount or range of loss, if any, that could result from any unfavorable outcome. Maui windstorm and wildfires costs. Legal costs in connection with the litigation and loss contingencies are expensed as incurred. The Company has $165 million of excess liability insurance and $25 million of miscellaneous professional liability insurance for third party claims, including claims related to wildfires, with a retention of $0.3 million and $1.0 million, respectively, and $145 million directors and officers liability insurance to cover claims related to the shareholder and derivative lawsuits, with a retention of $1.0 million. As of June 30, 2024, the Company’s and Utilities’ insurance receivable totaled $34.8 million and $29.6 million, respectively, under the policies. As of June 30, 2024, HEI and its subsidiaries have approximately $41 million, $25 million and $133 million of insurance coverage remaining under the excess liability, miscellaneous professional liability and directors and officers liability policies, respectively. See table below for the incremental expenses related to the Maui windstorm and wildfires.
1 Related to the PUC’s order, received on December 27, 2023, approving deferred accounting treatment for the Utilities’ incremental non-labor expenses related to the August 2023 Maui windstorm and wildfires. Amounts were reclassified to a regulatory asset. On May 4, 2024, HEI and the Utilities reached an agreement to settle indemnification claims asserted by the State of Hawaii without any admission of fault or responsibility. Under the terms of the agreement, HEI and the Utilities agreed to contribute up to $18.4 million through the end of 2024 related to the costs of the professional advisors engaged by the State of Hawaii to advise on a variety of matters related to the Maui windstorm and wildfires. Under certain circumstances, HEI and the Utilities have the unilateral right to terminate the agreement and stop paying the costs for future periods. As of June 30, 2024, a total of $10.6 million of such costs were accrued and reflected in Maui windstorm and wildfires related expenses-Other expense in the table above. HEI and the Utilities are seeking insurance recoveries for such costs; however, the timing and amount of any insurance recoveries are not determinable at this time. In addition, the Utilities incurred $2.1 million and $7.7 million of total capital costs related to the Maui windstorm and wildfires for the three and six months ended June 30, 2024, respectively.
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Segment financial information |
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Segment financial information | Segment financial information
Intercompany electricity sales of the Utilities to ASB and “other” segments are not eliminated because those segments would need to purchase electricity from another source if it were not provided by the Utilities and the profit on such sales is nominal. Sales from Hamakua Energy, LLC (Hamakua Energy) to Hawaii Electric Light (a regulated affiliate) are eliminated in consolidation.
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Electric utility segment |
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Electric Utility Subsidiary [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Electric utility segment | Electric utility segment Unconsolidated variable interest entities. Power purchase agreements. As of June 30, 2024, the Utilities had four power purchase agreements (PPAs) for firm capacity 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 legal, regulatory and environmental proceedings. Excluding the potential liabilities from the Maui windstorm and wildfires, 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. The Utilities record loss contingencies when the outcome of such proceedings is probable and when the amount of the loss is reasonably estimable. The Utilities also evaluate, on a continuous basis, whether developments in such proceedings could cause these assessments or estimates to change. Assessment regarding future events is required when evaluating whether a loss is probable or reasonably possible, and as to whether such loss or a range of such loss is estimable. Management is often unable to estimate a reasonably possible loss, or a range of loss, particularly in cases in which: (i) the damages sought are indeterminate or the basis for the damages claimed is not clear; (ii) proceedings are in early stages; (iii) discovery is not complete; (iv) the matters involve novel or unsettled legal theories; (v) significant facts are in dispute; (vi) a large number of parties are represented (including circumstances in which it is uncertain how liability, if any, would be shared among multiple defendants); (vii) a lower court or administrative agency’s decision or ruling has been appealed; and/or (viii) a wide range of potential outcomes exist. In such cases, there may be considerable uncertainty regarding the timing or ultimate resolution, including any possible loss, fine, penalty, or business impact. August 2023 Maui windstorm and wildfires. See Note 2. 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 the termination of the original PPA. Following the termination, Hu Honua filed a lawsuit in the U.S. District Court for the District of Hawaii. The parties reached a settlement that was conditioned on the PUC’s timely, non-appealable final approval of an amended and restated PPA dated May 9, 2017. On May 23, 2022, following a contested case hearing, 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 greenhouse gas (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, which were denied by the PUC on June 24, 2022. 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. On March 13, 2023, the Hawaii Supreme Court affirmed the PUC’s decision denying the amended and restated PPA between Hu Honua and Hawaii Electric Light and entered its judgment on appeal on April 12, 2023. On June 7, 2023, Hu Honua filed a status report with the U.S. District Court for the District of Hawaii, stating, among other things, that because settlement of the underlying federal lawsuit was contingent on timely, non-appealable, final approval of the amended and restated PPA by the PUC, that the Hawaii Supreme Court’s opinion made fulfillment of the condition impossible, and therefore the settlement agreement between the Hawaiian Electric defendants (HEI, Hawaiian Electric, and Hawaii Electric Light) and Hu Honua is null and void and of no further effect. On November 16, 2023, Hu Honua filed its Motion for Leave to File Third Amended and Supplemental Complaint and for Permissive Joinder with the U.S. District Court for the District of Hawaii, asking the court to grant it leave to file a Third Amended and Supplemental Complaint, which would amend its claims and add three new proposed defendants. The hearing on this motion took place on February 14, 2024. The court issued a decision and order on the motion on April 2, 2024, which was consistent with Hawaii Electric Light's position, only allowing amendments that were agreed to and not allowing Hu Honua to add new claims or parties, effectively leaving Hu Honua with its previously-pled breach of contract and antitrust claims. Hu Honua filed its objection to the order on April 16, 2024 and the Hawaiian Electric defendants filed their response to the objection on April 30, 2024. A hearing on Hu Honua’s objection took place on July 30, 2024 and the parties are awaiting a court order to be issued. 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 (BESS) 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 a 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. 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 Environmental Protection Agency (EPA) has since identified environmental impacts in the subsurface soil at the Site. In cooperation with the State of Hawaii Department of Health 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 $2.5 million as of June 30, 2024, 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. 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 June 30, 2024, the reserve account balance recorded by Hawaiian Electric to address the PCB contamination was $9.5 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. Kapolei pipeline. James Campbell Company (JCC) through its wholly owned subsidiary, Aina Nui Corporation discovered petroleum contamination in ground water during construction of a project in Kapolei in late 2022 and incurred approximately $0.8 million in remediation costs. JCC made a joint demand for these costs in June 2023 to the two companies, including Hawaiian Electric, that have pipelines in the area of the contamination. This demand was updated in April 2024 to $1.4 million to incorporate additional costs. It has not been determined whether the nature of the contamination is consistent with what was in the Utilities’ pipelines or is wholly or partially the responsibility of the other pipeline owner and whether the costs were properly incurred. At this time, the parties are engaging in settlement discussions and the Utilities have determined that the estimated probable loss is not material. Endangered Species Act. The Utilities received a 60-day notice under the federal Endangered Species Act, from Earthjustice on behalf of the American Bird Conservancy and Conservation Council for Hawaii in early February 2024. The 60-day notice is the pre-cursor to a citizen’s suit under the Endangered Species Act. The notice alleges that the Utilities are out of compliance with the Act due to alleged impacts on endangered seabirds caused by the Utilities’ powerlines, street lights and facility lights on Maui and Lanai. The Utilities are already in the process of drafting a Habitat Conservation Plan and will be applying for associated state and federal permits. The notice asserts that the scope of the plan should be broader and that additional interim measures are required while the plan and permits are pending. At this time, the parties are engaging in settlement discussions and the Utilities are unable to determine the ultimate outcome or the amount of any possible loss. Commitments. Purchase commitments. In the ordinary course of business, the Utilities enter into various agreements to purchase power and lease fuel barge. As of December 31, 2023, the Utilities estimated future purchase obligations of $1.7 billion. See Note 4 of the Notes to the Consolidated Financial Statements in Item 8 of the 2023 Form 10-K. On March 28, 2024, AES West Oahu Solar project reached commercial operations, which has a capacity of 12.5 MW with 50 MWh batteries and total annual payment of $3.2 million. On May 31, 2024, AES Kuihelani Solar project on Maui reached commercial operations, which has a capacity of 60 MW with 240 MWh batteries and total annual payment of $13.2 million. On June 7, 2024, the Kupono Solar project on Oahu reached commercial operations, which has a capacity of 42 MW with 168 MWh batteries and total annual payment of $11.5 million. For the six months ended June 30, 2024, $107.4 million of finance lease liabilities with corresponding right-of-use assets was recorded for the battery portion of the PPAs and a total of three Stage 1 and Stage 2 renewable projects provide the Utilities of 114.5 MW, with 458 MWh batteries. Purchases from all IPPs were as follows:
1 Includes hydro power and other PPAs. 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. 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 was placed in service on October 25, 2023. Maui Electric petitioned and received from the State of Hawaii Department of Health a one-year extension to the mandatory retirement of Kahului Power Plant and there is now flexibility to operate the units until the end of 2028. 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 June 30, 2024, $25.5 million has been incurred for the project. Waena Battery Energy Storage System Project. In September 2020, Maui Electric filed a PUC application to purchase and install a 40 MW BESS at its Waena Site in Central Maui. In December 2023, the PUC approved Maui Electric’s request to commit funds estimated at $82.1 million, for the purchase and installation of the project, and to recover costs for the project under EPRM. Project costs incurred as of June 30, 2024 amount to $0.6 million. Climate Adaptation Transmission and Distribution Resilience Program. The Utilities maintain that improving resiliency of the electric grid is an urgent matter and recognizes that climate change is making Hawaii increasingly vulnerable to sever weather events. On January 31, 2024, the PUC approved the Utilities’ request to commit an estimated $189.7 million in funds for the Climate Adaptation Transmission and Distribution Resilience Program, over a project period of five years. The project is to focus on, among other things, system hardening in wildfire risk areas to prevent ignition and to enable quicker response, video camera and weather monitors in wildfire risk areas and to add situational awareness, and strengthening transmission lines. The project costs to be recovered through EPRM is subject to a cap of $95 million and any amount in excess will be subject to the PUC’s further review. On August 7, 2024, the Utilities received a notification from the U.S. Department of Energy that its application for $95 million in federal funds under the Infrastructure Investment and Jobs Act (IIJA) has been awarded. Project costs incurred as of June 30, 2024 amount to $1.8 million. 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 the 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 continued as previously implemented (e.g., the Energy Cost Recovery Clause, Purchased Power Adjustment Clause (PPAC), Demand-Side Management surcharge, Renewable Energy Infrastructure Program, Demand Response Adjustment Clause, 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 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. The June 2022 D&O approved two PIMs, a SSM, and extended the timeframe for an existing PIM. Specifically, the PUC approved (1) a (penalty-only) generation-caused interruption reliability PIM, (2) a (penalty/reward) interconnection requirements study PIM, (3) a (reward-only) Collective Shared Savings Mechanism (CSSM), and (4) a modification and extension of the existing Interim Grid Services PIM (reward-only). On November 23, 2022, the PUC approved the Utilities’ proposed tariffs to implement the aforementioned PIMs with an effective date of January 1, 2023. 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 March 30, 2023, the PUC held a PBR Working Group coordination meeting to initiate subgroups on the Long-Term Grid Services PIM, modification/evaluation of existing PIMs, and comprehensive PBR Framework review priority topics. In accordance with the June 2022 D&O, the Utilities filed their FIP on September 30, 2022, Long-Term Grid Services PIM proposal on July 3, 2023, and FF Retirement Report on April 12, 2024. On October 16, 2023, the Utilities filed a request for limited suspension of the Transmission and Distribution (T&D) System Average Interruption Duration Index (SAIDI) PIM, the T&D System Average Interruption Frequency Index (SAIFI) PIM, and the target heat rate provision of Maui Electric Maui Division’s Energy Cost Recovery Clause (ECRC) tariff starting from August 8, 2023. On December 28, 2023, the PUC issued an order granting a temporary suspension of Maui Electric’s T&D SAIDI and SAIFI PIMs and Maui Electric Maui Division’s target heat rate provision from August 8, 2023 through June 30, 2024, which the tariffs became effective on January 1, 2024. On November 3, 2023, the Utilities, Ulupono Initiative LLC, and the County of Hawaii filed a stipulation on proposed modifications to the RPS-A, Call Center, AMI Utilization, and interconnection requirements study PIMs. On June 24, 2024, the PUC issued an order (1) approving modifications to the interconnection requirements study PIM to expand its application to firm generation projects effective August 1, 2024, (2) approving a consolidated target for the Call Center PIM and modifying the target performance based on the average of the Utilities’ performance, weighted by the number of calls for the last eight quarters as of December 31, 2023, to be effective August 1, 2024, (3) denying the proposed modifications to the RPS-A PIM and clarifying that it will continue to operate according to its existing tariff language; and (4) denying the proposed modifications to the AMI Utilization PIM and declining to extend the PIM beyond its scheduled sunset date of December 31, 2023. On December 26, 2023, the PUC issued an order (1) confirming that the Interim Grid Services PIM will sunset on December 31, 2023, (2) extending the Interconnection Approval PIM through December 31, 2024, and (3) determining that it will continue examination of the Long-Term Grid Services PIM into 2024 as part of a broader examination that addresses barriers to the utilization of DERs to meet grid needs. On April 1, 2024, the Utilities filed a request for partial temporary suspension and modification of the T&D SAIDI and T&D SAIFI PIMs to specifically suspend the T&D SAIDI and T&D SAIFI PIMs for wildfire risk circuits from January 1, 2024 to December 31, 2025. The Utilities also proposed that circuits not identified as wildfire risk circuits would continue to be subject to the existing PIMs on a prorated basis. On April 26, 2024, the PUC issued a procedural schedule to govern review of the request, a D&O is requested by December 16, 2024. On June 19, 2024, the PUC issued an order (June 2024 order) providing preliminary guidance regarding the comprehensive evaluation of the PBR Framework that will commence in the fourth year of the PBR Framework’s first MRP (PBR Framework Review). The PUC has developed a high-level review structure and timeline for the PBR Framework Review and divided the remainder of the first MRP into three phases: (i) the evaluation of the current PBR Framework, (ii) the examination of proposal for modifications to the PBR Framework, and (iii) the implementation of modifications prior to commencing the second MRP. At the PBR Working Group meeting held on June 26, 2024, the PUC staff solicited the parties’ feedback on the scope of the PBR Framework Review and discussed other considerations, including rebasing target revenues. On July 19, 2024, as requested by the PUC staff, the parties filed written feedback to materials presented and discussed at the June Working Group meeting and in the June 2024 order. The PUC intends to issue a detailed process order initiating the PBR Framework Review. 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 ARA mechanism replaced the previous revenue adjustment mechanism (RAM). 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 to the extent such adjustments are not included in base rate unless modified with PUC approval. 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 deadband 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 deadband in either direction, and a 90/10 sharing for any further difference. A reopening or review of the PBR terms may 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. On August 31, 2023, the PUC issued an order temporarily suspending the ESM until further notice. The intent of the order is to address the unintended consequence of customers potentially bearing the costs associated with the Maui windstorm and wildfires through the operation of the ESM without prior PUC review. 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 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 June 30, 2024, the Utilities annualized MPIR and EPRM revenue amounts totaled $33.1 million, including revenue taxes, for the Schofield Generating Station ($16.5 million), West Loch PV project ($3.3 million), Grid Modernization Strategy (GMS) Phase 1 project ($11.2 million for all three utilities), Waiawa UFLS project ($0.1 million) and Waena Switchyard/Synchronous project ($2.0 million) that included the 2023 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 2023 MPIR amounts for the Schofield Generating Station, West Loch PV, GMS Phase 1, and Waiawa UFLS projects effective June 1, 2023 and for the Waena Switchyard project effective January 1, 2024 through the RBA rate adjustment. As of June 30, 2024, the PUC approved four EPRM applications for projects totaling $218.5 million to the extent the project costs are not included in rates. Currently, the Utilities are seeking EPRM recovery for four additional projects with total project costs up to $712.9 million, subject to PUC approval. Pilot process. As part of the PBR Framework, the PUC approved a pilot process to foster innovation by establishing an expedited implementation process for pilots that tests new technologies, programs, business models, and other arrangements (Pilot Process). Under the Pilot Process, the Utilities submit specific pilot proposals (Pilot Notices) that are within the scope of the approved Workplan to the PUC for their expedited review. 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 will be considered approved as submitted. The PUC may modify the pilot as originally proposed, and the Utilities will have 15 days to notify the PUC whether the Utilities accept the modification, propose further modification, or withdraw the Pilot Notice. The PUC may also, where necessary, suspend the Pilot Notice for further investigation. The approved Pilot Process includes a cost recovery process that generally allows the Utilities to defer and recover total annual expenditures of approved pilot projects net of revenues, subject to an annual cap of $10 million, over 12 months beginning June 1 of the year following pilot implementation through the RBA rate adjustment, although the PUC may determine on a case-by-case basis that a particular project’s deferred costs should be amortized over a period greater than 12 months. On March 11, 2024, the Utilities filed their annual Pilot Update report covering pilot projects that were active during 2023, including reporting on pilot projects that were initiated prior to the commencement of the Pilot Process. The Pilot Update reported on approximately $3.0 million of 2023 recorded pilot project costs including revenue taxes for the Utilities. The 2023 recorded pilot project costs were included in the Utilities’ proposed adjustments to target revenue in the 2024 spring revenue report filed on March 28, 2024. Performance incentive mechanisms. The following PIMs and SSMs were approved by the PUC and are applicable for the 2023 evaluation period and through June 30, 2024. •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 SAIDI and SAIFI (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 $6.4 million for calendar year 2023 - for both indices in total for the three utilities). On December 28, 2023, the PUC issued an order granting a temporary suspension of Maui Electric’s T&D SAIDI and SAIFI PIMs from August 8, 2023 through June 30, 2024. For the 2023 evaluation period, the Utilities incurred $3.7 million in penalties. •Call Center Performance measured by the percentage of calls answered within 30 seconds. The previous target performance was based on the annual average performance for each utility for the most recent eight quarters with a deadband of 3% above and below the target. On June 24, 2024, the PUC issued an order approving a consolidated target for the Call Center PIM and modifying the target performance based on the average of the Utilities’ performance, weighted by the number of calls for the last eight quarters as of December 31, 2023, to be effective August 1, 2024. 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. The first portion 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 prorated in proportion to the actual amount of energy utilized, which is estimated to occur from 2023 to 2025. Based on the in-service date of two projects, the Utilities earned the second portion of the incentive of approximately $0.1 million (for Hawaiian Electric) in rewards in both 2023 and the first quarter of 2024. In the second quarter of 2024, the Utilities accrued the second portion of the incentive of approximately $0.1 million (for Hawaii Electric Light). •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. In 2023, the Utilities earned $0.4 million in rewards. •Interim Grid Services - A PIM that provides financial rewards on a $/kW basis for the acquisition of eligible grid services. The June 2022 D&O modified and extended the Interim Grid Services PIM through December 31, 2023 and 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. In 2023, the Utilities earned $1.1 million in rewards. The Interim Grid Services PIM sunset on December 31, 2023. The PUC intends to replace the Interim Grid Services PIM with a Long-Term PIM that incents DER grid service utilization. Review and development of the Long-Term DER Utilization PIM continues in 2024. •Interconnection Approval PIM that provides financial rewards and penalties for interconnection times for DER systems <100 kW in size. The Interconnection Approval PIM extends through December 31, 2024. The Utilities can earn a total annual maximum reward of $3.0 million or a total annual maximum penalty of $0.9 million. In 2023, the Utilities earned $3.0 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 earned $0.01 million in rewards for the program period ending June 30, 2023. •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 Advanced Metering Infrastructure Utilization PIM sunset on December 31, 2023. •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 interconnection requirements study 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 20% share 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 potential penalty and does not have a cap for maximum reward. For the 2023 evaluation period, the Utilities earned $0.9 million ($1.2 million for Hawaiian Electric, $(0.6) million for Hawaii Electric Light and $0.3 million for Maui Electric) in rewards net of penalties. The net rewards related to 2023 and for the period through March 2024 were reflected in the 2024 PIMs annual report and 2024 spring revenue report filings. In the second quarter of 2024, the Utilities accrued an additional $0.1 million reward for the Phase 1 RFP PIM (for Hawaii Electric Light), which will be reflected in the upcoming 2024 fall revenue report filing. 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’ 2024 spring revenue report filed on March 28, 2024 was approved by the PUC on May 16, 2024. The filing reflected ARA revenues for recovery of the COVID-19 related deferred costs through the Z-factor and the accelerated return of the Enterprise Resource Planning system benefits savings to Hawaii Electric Light and Maui Electric customers as part of the customer dividend, as follows. (See discussion under “Regulatory assets and liabilities” below).
The net incremental amounts between the 2023 fall and 2024 spring revenue reports are shown in the following table. The amounts are to be collected (refunded) from June 1, 2024 through May 31, 2025 under the RBA rate tariffs, which were included in the 2024 spring revenue report filing.
Regulatory assets and liabilities. Regulatory asset related to retirement of Honolulu generating units 8 and 9. On December 22, 2023, the PUC issued a decision and order approving the Utilities’ request to establish a regulatory asset for the remaining net book value of the fossil fuel generating units for both Honolulu units 8 and 9 assets that retired on December 31, 2023, and amortize the regulatory asset over approximately nine years. The PUC also ruled that the Utilities may seek to include the regulatory asset in rate base and seek to recover the amortization expense and a return on the unamortized balance of the regulatory asset in the next rate case or rate re-setting proceeding. As of June 30, 2024, the Utilities have recorded $28.3 million in regulatory assets for the remaining net book value of Honolulu generating units 8 and 9. Regulatory assets for Maui windstorm and wildfires related costs. On December 27, 2023, the PUC issued an order authorizing deferred accounting treatment for the Utilities’ incremental non-labor expenses under specific cost categories related to the August 2023 Maui windstorm and wildfires. The deferred accounting treatment applies to certain non-labor expenses incurred from August 8, 2023 through December 31, 2024 that are not already a part of base rates. The approval pertains to deferred cost treatment. The requests for cost recovery of deferred costs will be the subject of a separate application at which time the PUC will evaluate whether such costs were prudently incurred and reasonable and determine the extent to which such costs will be eligible for recovery, and the period over which recovery will occur. If the PUC denies recovery of any deferred costs, such costs would be charged to expense in the period that those costs are no longer considered probable of recovery. As of June 30, 2024, the Utilities have recorded $30.2 million in regulatory assets for the incremental costs incurred related to the Maui windstorm and wildfires event. Regulatory liabilities for Enterprise Resource Planning/Enterprise Asset Management (ERP/EAM). 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 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 other operation and maintenance (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 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 December 29, 2023, the PUC approved the Utilities’ proposal to accelerate flow-through of the ERP benefits savings currently tracked in regulatory liability accounts to Hawaii Electric Light and Maui Electric customers as part of the customer dividend in the ARA, to mitigate the impact of the Utilities’ recovery of the COVID-19 related costs on customers. See “Regulatory assets for COVID-19 related costs” section below. As of June 30, 2024, the Utilities’ regulatory liability was $13.1 million ($1.9 million for Hawaiian Electric, $4.5 million for Hawaii Electric Light and $6.7 million for Maui Electric) for the O&M expense savings that are being amortized or to be included in future rates. At the PUC’s direction, the Utilities have been filing Annual Enterprise System Benefits (AESB) report on the achieved benefits savings. The most recent AESB report was filed on February 13, 2024 for the period January 1 through December 31, 2023. Regulatory assets for COVID-19 related costs. On December 29, 2023, the PUC issued a decision and order (December 2023 D&O) approving the Utilities’ request to recover the COVID-19 related deferred costs up to $8.8 million evenly over a three-year recovery period from 2024 through 2026 through the Z-factor in the ARA. Following the Utilities’ motion for clarification or in the alternative partial reconsideration of the December 2023 D&O, on February 27, 2024, the PUC issued an order clarifying the December 2023 D&O and approving, among other things, the Utilities’ requests to base the recovery on the recorded balances as of December 31, 2023 and to modify the recovery period to begin June 1, 2024 and end May 31, 2027. As of June 30, 2024, the Utilities have recorded $8.3 million in regulatory assets for deferral of COVID-19 related costs. Regulatory assets for suspension of disconnections related costs. Based on the circumstances related to the Maui windstorm and wildfires, on August 31, 2023 and subsequently on October 13, 2023, the PUC issued orders directing all regulated utilities located on, or providing utility service on Maui, including the Utilities, among other things, (i) to suspend disconnections of services and associated disconnection fees beginning from August 8, 2023, through the end of the emergency relief period established by the Governor’s Emergency Proclamations related to the Maui windstorm and wildfires, which currently continues through August 31, 2024 (Suspension Period); (ii) to suspend any and all rules and provisions of individual utility tariffs that prevent or condition re-connection of disconnected customers during the Suspension Period; (iii) not to charge customers interest on past due payments or impose any late payment fees through the Suspension Period; (iv) to establish regulatory assets to record costs directly related to the suspension of disconnections, and to record receipt of governmental aid and donation-based aid, loans or grants, and/or all other assistance measures, and any cost savings realized; and (v) to file a notice with the PUC regarding any upcoming application or other request pursuant to HRS Sections 269-16.3, -17, -17.5, -18, -19, or -19.5 and/or regarding any significant financial change to the Maui utility, at least 60 days prior to filing such application or other request with the PUC. The orders also discourage the filing of emergency or general rate increases in response to the emergency situation. In future proceedings, the PUC will assess the utility’s request for recovery of these regulatory assets including whether it is reasonable and necessary, the appropriate period of recovery for the approved amount of regulatory assets, any amount of carrying costs thereon, any savings directly attributable to suspension of disconnects, and other related matters. As of June 30, 2024, the Utilities have recorded $1.7 million in regulatory assets for the incremental costs incurred due to the suspension of disconnections. Condensed consolidating financial information. Condensed consolidating financial information for Hawaiian Electric and its subsidiaries are presented for the three and six months ended June 30, 2024 and 2023, and as of June 30, 2024 and December 31, 2023. On March 21, 2024, Hawaiian Electric formed HE AR INTER LLC, which was established to pursue financing through a secured asset-based (accounts receivable) credit facility. As of June 30, 2024, there was no activity. 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 June 30, 2024
Hawaiian Electric Company, Inc. and Subsidiaries Condensed Consolidating Statement of Comprehensive Income Three months ended June 30, 2024
Hawaiian Electric Company, Inc. and Subsidiaries Condensed Consolidating Statement of Income Three months ended June 30, 2023
Hawaiian Electric Company, Inc. and Subsidiaries Condensed Consolidating Statement of Comprehensive Income Three months ended June 30, 2023
Hawaiian Electric Company, Inc. and Subsidiaries Condensed Consolidating Statement of Income Six months ended June 30, 2024
Hawaiian Electric Company, Inc. and Subsidiaries Condensed Consolidating Statement of Comprehensive Income Six months ended June 30, 2024
Hawaiian Electric Company, Inc. and Subsidiaries Condensed Consolidating Statement of Income Six months ended June 30, 2023
Hawaiian Electric Company, Inc. and Subsidiaries Condensed Consolidating Statement of Comprehensive Income Six months ended June 30, 2023
Hawaiian Electric Company, Inc. and Subsidiaries Condensed Consolidating Balance Sheet June 30, 2024
(continued) Hawaiian Electric Company, Inc. and Subsidiaries Condensed Consolidating Balance Sheet (continued) June 30, 2024
Hawaiian Electric Company, Inc. and Subsidiaries Condensed Consolidating Balance Sheet December 31, 2023
(continued) Hawaiian Electric Company, Inc. and Subsidiaries Condensed Consolidating Balance Sheet (continued) December 31, 2023
Hawaiian Electric Company, Inc. and Subsidiaries Condensed Consolidating Statement of Changes in Common Stock Equity Six months ended June 30, 2024
Hawaiian Electric Company, Inc. and Subsidiaries Condensed Consolidating Statement of Changes in Common Stock Equity Six months ended June 30, 2023
Hawaiian Electric Company, Inc. and Subsidiaries Condensed Consolidating Statement of Cash Flows Six months ended June 30, 2024
Hawaiian Electric Company, Inc. and Subsidiaries Condensed Consolidating Statement of Cash Flows Six months ended June 30, 2023
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Bank segment | Bank segment Selected financial information American Savings Bank, F.S.B. Statements of Income and Comprehensive Income Data
Reconciliation to amounts per HEI Condensed Consolidated Statements of Income*:
Goodwill. Goodwill is initially recorded as the excess of the purchase price over the fair value of the net assets acquired in a business combination and is subsequently evaluated at least annually for impairment. The Company has identified ASB as a reporting unit and ASB’s goodwill relates to past acquisitions and is ASB’s only intangible asset with an indefinite useful life. The Company performs assessments of the carrying value of its goodwill at least annually and whenever events occur or circumstances change that would more-likely-than-not reduce the fair value of a reporting unit below its carrying amount. Examples of these events and circumstances include a significant change in business climate, an adverse action or assessment by a regulator, competition, loss of key personnel, a more-likely-than-not expectation that a reporting unit or a significant portion of a reporting unit will be sold or otherwise disposed of, and other factors. HEI and ASB have been undertaking a comprehensive review of strategic options for ASB. During the course of this process, HEI and ASB had determined it is more-likely-than-not that the fair value of ASB is less than its carrying value. In light of this, as part of its on-going goodwill evaluation and the change in circumstances, after performing the goodwill impairment test as of June 30, 2024, HEI and ASB determined the full amount of its goodwill was impaired. As a result of our June 30, 2024 impairment test we recorded a pretax goodwill impairment charge of $82.2 million for the three and six months ended June 30, 2024. The impairment charge is recorded in “Total Noninterest Expense” in ASB’s Statements of Income and Comprehensive Income Data, and recorded in “Bank Expenses” in the Company’s Condensed Consolidated Statements of Income. The impairment charge was non-cash in nature and did not affect the Company’s current liquidity, cash flows or any debt covenants under the Company’s existing credit agreements. American Savings Bank, F.S.B. Balance Sheets Data
Bank-owned life insurance is life insurance purchased by ASB on the lives of certain key employees, with ASB as the beneficiary. The insurance is used to fund employee benefits through tax-free income from increases in the cash value of the policies and insurance proceeds paid to ASB upon an insured’s death. Other borrowings consisted of FHLB advances and borrowings from the Federal Reserve Bank. Investment securities. The major components of investment securities were as follows:
* Issued or guaranteed by U.S. Government agencies or sponsored agencies ASB does not believe that the investment securities that were in an unrealized loss position at June 30, 2024 and December 31, 2023, represent a credit loss. Total gross unrealized losses were primarily attributable to change in market conditions. On a quarterly basis the investment securities are evaluated for changes in financial condition of the issuer. Based upon ASB’s evaluation, all securities held within the investment portfolio continue to be rated investment grade by one or more agencies. The contractual cash flows of the U.S. Treasury, federal agency obligations and agency mortgage-backed securities are backed by the full faith and credit guaranty of the United States government, an agency of the government or a government-sponsored entity. ASB does not intend to sell the securities before the recovery of its amortized cost basis and there have been no adverse changes in the timing of the contractual cash flows for the securities. ASB’s investment securities portfolio did not require an allowance for credit losses at June 30, 2024 and December 31, 2023. U.S. Treasury, federal agency obligations, corporate bonds, and mortgage revenue bonds have contractual terms to maturity. Mortgage-backed securities have contractual terms to maturity, but require periodic payments to reduce principal. In addition, expected maturities will differ from contractual maturities because borrowers have the right to prepay the underlying mortgages. The contractual maturities of investment securities were as follows:
There were no sales of available-for-sale securities for the three and six months ended June 30, 2024 and 2023. The components of loans were summarized as follows:
ASB's policy is to require private mortgage insurance on all real estate loans when the loan-to-value ratio of the property exceeds 80% of the lower of the appraised value or purchase price at origination. As of June 30, 2024, ASB had commitments to borrowers for loans and unused lines and letters of credit of $1.9 billion, of which, commitments to lend to borrowers experiencing financial difficulty whose loan terms have been modified were nil. Allowance for credit losses. The allowance for credit losses (balances and changes) by portfolio segment were as follows:
Allowance for loan commitments. The allowance for loan commitments by portfolio segment were as follows:
Credit quality. ASB performs an internal loan review and grading on an ongoing basis. The review provides management with periodic information as to the quality of the loan portfolio and effectiveness of its lending policies and procedures. The objectives of the loan review and grading procedures are to identify, in a timely manner, existing or emerging credit trends so that appropriate steps can be initiated to manage risk and avoid or minimize future losses. Loans subject to grading include commercial, commercial real estate and commercial construction loans. Each commercial and commercial real estate loan is assigned an Asset Quality Rating (AQR) reflecting the likelihood of repayment or orderly liquidation of that loan transaction pursuant to regulatory credit classifications: Pass, Special Mention, Substandard, Doubtful, and Loss. The AQR is a function of the probability of default model rating, the loss given default, and possible non-model factors which impact the ultimate collectability of the loan such as character of the business owner/guarantor, interim period performance, litigation, tax liens and major changes in business and economic conditions. Pass exposures generally are well protected by the current net worth and paying capacity of the obligor or by the value of the asset or underlying collateral. Special Mention loans have potential weaknesses that, if left uncorrected, could jeopardize the liquidation of the debt. Substandard loans have well-defined weaknesses that jeopardize the liquidation of the debt and are characterized by the distinct possibility that ASB may sustain some loss. An asset classified Doubtful has the weaknesses of those classified Substandard, with the added characteristic that the weaknesses make collection or liquidation in full, on the basis of currently existing facts, conditions, and values, highly questionable and improbable. An asset classified Loss is considered uncollectible and has such little value that its continuance as a bankable asset is not warranted. The credit risk profile by vintage date based on payment activity or internally assigned grade for loans was as follows:
Gross charge-offs by portfolio segment and vintage were as follows:
Revolving loans converted to term loans during the six months ended June 30, 2024 in the commercial, home equity line of credit and consumer portfolios were $1.9 million, $11.3 million and $0.4 million, respectively. Revolving loans converted to term loans during the six months ended June 30, 2023 in the commercial, home equity line of credit and consumer portfolios were $2.0 million, $14.9 million and $0.9 million, respectively. The credit risk profile based on payment activity for loans was as follows:
The credit risk profile based on nonaccrual loans were as follows:
ASB did not recognize interest on nonaccrual loans for the six months ended June 30, 2024 and 2023. Modifications Made to Borrowers Experiencing Financial Difficulty. The allowance for credit losses incorporates an estimate of lifetime expected credit losses and is recorded on each asset upon origination. The starting point for the estimate of the allowance for credit losses is historical loan information, which includes losses from modifications of receivables to borrowers experiencing financial difficulty. ASB uses a probability of default/loss given default model to determine the allowance for credit losses. An assessment of whether a borrower is experiencing financial difficulty is made at the time of the modification. Because the effect of most modifications made to borrowers experiencing financial difficulty is already included in the allowance for credit losses, a change to the allowance for credit losses is generally not recorded upon modification. Modifications may include interest rate reductions, interest only payments for an extended period of time, protracted terms such as amortization and maturity beyond the customary length of time found in the normal marketplace, and other actions intended to minimize economic loss and to provide alternatives to foreclosure or repossession of collateral. Loan modifications made to borrowers experiencing financial difficulty during the three and six months ended June 30, 2024 were as follows:
Financial effect of loan modifications during the three and six months ended June 30, 2024 for borrowers experiencing financial difficulty were as follows:
Credit risk profile based on payment activity for loans modified during the six months ended June 30, 2024 were as follows:
During the six months ended June 30, 2024, there were no loan modifications made to borrowers experiencing financial difficulty that defaulted. Collateral-dependent loans. A loan is considered collateral-dependent when the borrower is experiencing financial difficulty and repayment of the loan is expected to be provided substantially through the operation or sale of the collateral. Loans considered collateral-dependent were as follows:
ASB had $3.6 million and $3.4 million of consumer mortgage loans collateralized by residential real estate property that were in the process of foreclosure at June 30, 2024 and December 31, 2023, respectively. Mortgage servicing rights (MSRs). In its mortgage banking business, ASB sells residential mortgage loans to government-sponsored entities and other parties, who may issue securities backed by pools of such loans. ASB retains no beneficial interests in these loans other than the servicing rights of certain loans sold. ASB received proceeds from the sale of residential mortgages of $30.9 million and $8.9 million for the three months ended June 30, 2024 and 2023, respectively, and recognized gains on such sales of $0.4 million and $0.3 million for the three months ended June 30, 2024 and 2023, respectively. ASB received proceeds from the sale of residential mortgages of $57.3 million and $14.6 million for the six months ended June 30, 2024 and 2023, respectively, and recognized gains on such sales of $0.8 million and $0.4 million for the six months ended June 30, 2024 and 2023, respectively. There were no repurchased mortgage loans for the six months ended June 30, 2024 and 2023. Mortgage servicing fees, a component of other income, net, were $0.8 million and $0.9 million for the three months ended June 30, 2024 and 2023, respectively. Mortgage servicing fees, a component of other income, net, were $1.7 million and $1.8 million for the six months ended June 30, 2024 and 2023, respectively. Changes in the carrying value of MSRs were as follows:
Changes related to MSRs were as follows:
ASB capitalizes MSRs acquired upon the sale of mortgage loans with servicing rights retained. On a monthly basis, ASB compares the net carrying value of the MSRs to its fair value to determine if there are any changes to the valuation allowance and/or other-than-temporary impairment for the MSRs. ASB uses a present value cash flow model to estimate the fair value of MSRs. Impairment is recognized through a valuation allowance for each stratum when the carrying amount exceeds fair value, with any associated provision recorded as a component of loan servicing fees included in “Revenues - bank” in the condensed consolidated statements of income. A direct write-down is recorded when the recoverability of the valuation allowance is deemed to be unrecoverable. Key assumptions used in estimating the fair value of ASB’s MSRs used in the impairment analysis were as follows:
The sensitivity analysis of fair value of MSRs to hypothetical adverse changes of 25 and 50 basis points in certain key assumptions was as follows:
The effect of a variation in certain assumptions on fair value is calculated without changing any other assumptions. This analysis typically cannot be extrapolated because the relationship of a change in one key assumption to the changes in the fair value of MSRs typically is not linear. Other borrowings. As of June 30, 2024 and December 31, 2023, ASB had $520.0 million and $200.0 million of FHLB advances outstanding, respectively, and borrowings with the Federal Reserve Bank of nil and $550.0 million, respectively. As of June 30, 2024, ASB was in compliance with all FHLB Advances, Pledge and Security Agreement requirements and all requirements to borrow at the Federal Reserve Discount Window Primary Credit Facility under 12 CFR 201.4(a) guidelines. Derivative financial instruments. ASB enters into interest rate lock commitments (IRLCs) with borrowers, and forward commitments to sell loans or to-be-announced mortgage-backed securities to investors to hedge against the inherent interest rate and pricing risks associated with selling loans. ASB enters into IRLCs for residential mortgage loans, which commit ASB to lend funds to a potential borrower at a specific interest rate and within a specified period of time. IRLCs that relate to the origination of mortgage loans that will be held for sale are considered derivative financial instruments under applicable accounting guidance. Outstanding IRLCs expose ASB to the risk that the price of the mortgage loans underlying the commitments may decline due to increases in mortgage interest rates from inception of the rate lock to the funding of the loan. The IRLCs are free-standing derivatives which are carried at fair value with changes recorded in mortgage banking income. ASB enters into forward commitments to hedge the interest rate risk for rate locked mortgage applications in process and closed mortgage loans held for sale. These commitments are primarily forward sales of to-be-announced mortgage backed securities. Generally, when mortgage loans are closed, the forward commitment is liquidated and replaced with a mandatory delivery forward sale of the mortgage to a secondary market investor. In some cases, a best-efforts forward sale agreement is utilized as the forward commitment. These commitments are free-standing derivatives which are carried at fair value with changes recorded in mortgage banking income. Changes in the fair value of IRLCs and forward commitments subsequent to inception are based on changes in the fair value of the underlying loan resulting from the fulfillment of the commitment and changes in the probability that the loan will fund within the terms of the commitment, which is affected primarily by changes in interest rates and the passage of time. The notional amount and fair value of ASB’s derivative financial instruments were as follows:
ASB’s derivative financial instruments, their fair values and balance sheet location were as follows:
1 Asset derivatives are included in other assets and liability derivatives are included in other liabilities in the balance sheets. The following table presents ASB’s derivative financial instruments and the amount and location of the net gains or losses recognized in ASB’s statements of income:
Low-Income Housing Tax Credit (LIHTC). ASB’s unfunded commitments to fund its LIHTC investment partnerships were $87.2 million and $87.9 million at June 30, 2024 and December 31, 2023, respectively. These unfunded commitments were unconditional and legally binding and are recorded in other liabilities with a corresponding increase in other assets. As of June 30, 2024, ASB did not have any impairment losses resulting from forfeiture or ineligibility of tax credits or other circumstances related to its LIHTC investment partnerships.
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Credit agreements and changes in debt |
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Jun. 30, 2024 | |
Debt Disclosure [Abstract] | |
Credit agreements and changes in debt | Credit agreements and changes in debt On May 14, 2021, HEI and Hawaiian Electric each entered into a separate agreement with a syndicate of nine financial institutions (the HEI Facility and Hawaiian Electric Facility, respectively, and together, the Credit Facilities) to amend and restate their respective previously existing revolving unsecured credit agreements. The $175 million HEI Facility’s initial termination date was May 14, 2026. The $200 million Hawaiian Electric Facility’s initial termination date was May 13, 2022, but on February 18, 2022, the PUC approved Hawaiian Electric’s request to extend the term of the $200 million Hawaiian Electric Facility to May 14, 2026. In addition to extending the term, Hawaiian Electric also received PUC approval to exercise its options of two one-year extensions of the commitment termination date and to increase its aggregate revolving commitment amount from $200 million to $275 million, should there be a need. On April 21, 2023, HEI and Hawaiian Electric executed Amendment No. 1 to the Credit Facilities (Amendment). The Amendment was executed to reflect the transition from the London Inter-Bank Offered Rate to the Term Secured Overnight Financing Rate (SOFR) as the benchmark interest rate for non-Alternate Base Rate (ABR) Loans under the Credit Facilities. On May 14, 2023, HEI and Hawaiian Electric exercised their first of two, one-year extensions to the commitment termination date with eight of the nine financial institutions to extend the Credit Facilities to May 14, 2027. The committed capacities under the HEI Facility and Hawaiian Electric Facility are $175 million and $200 million, respectively, through May 14, 2026, and step down to approximately $157 million and $180 million, respectively, through May 14, 2027. After multiple downgrades of the Companies’ credit ratings to ratings below investment grade by Fitch, Moody’s and S&P due to the Maui windstorm and wildfires, on August 15, 2023, HEI made an initial $2.5 million draw on its $175 million existing revolving credit facility to repay maturing commercial paper. By August 23, 2023, HEI drew its remaining and Hawaiian Electric drew its full committed capacity on their respective existing revolving credit facilities, totaling $175 million and $200 million, respectively. The draws were made to provide access to liquidity and support the Company’s restoration efforts on Maui. The cash proceeds were primarily invested in highly liquid short-term investments and used for general corporate purposes. Under the HEI and Hawaiian Electric Intercompany Borrowing and Investment Policy effective January 1, 2020 (the Intercompany Borrowing Policy), HEI has committed to make revolving short-term loans to Hawaiian Electric pursuant to the terms set forth in the standing commitment letter dated December 8, 2023 (the 2023 Commitment Letter). For loans that mature on or before December 6, 2024, the 2023 Commitment Letter provides a borrowing limit of $75 million outstanding at any time and the applicable interest rate. Hawaiian Electric currently has no borrowings under the Intercompany Borrowing Policy and the 2023 Commitment Letter. Asset-backed lending facility credit agreement. On May 17, 2024, Hawaiian Electric, through a special-purpose subsidiary, entered into an asset-based lending facility (ABL Facility) credit agreement (ABL Credit Facility Agreement) with several banks, which, subject to the limitations and conditions set forth in such agreement, including approval by the PUC, allows borrowings of up to $250 million on a revolving basis using certain accounts receivable as collateral. Hawaiian Electric filed an application with the PUC for approval to (i) sell accounts receivable, and (ii) establish a long-term credit facility. The first approval would allow the ABL Credit Facility Agreement to become effective for 364 days and the second approval would extend the term of the ABL Credit Facility Agreement from 364 days to three years. The ABL Credit Facility Agreement has an initial term of 364 days, with an automatic extension to three years upon receipt of the second PUC approval, with three separate options to extend additional year, subject to the consent of the lenders. On June 27, 2024, Hawaiian Electric received the first approval from the PUC for the ABL Credit Facility Agreement that allows short-term borrowings of up to $250 million, subject to the availability of a sufficient borrowing base of eligible receivables. Per the parties’ proposed stipulated procedural schedule, the second PUC decision is expected on October 30, 2024. The ABL Facility became effective on July 24, 2024. Changes in debt. As of June 30, 2024, the Company and Hawaiian Electric were in compliance with all applicable financial covenants. Mahipapa non-recourse loan. In March 2024, a fire destroyed the cooling tower at the Mahipapa facility on Kauai. The fire was ignited from a vendor’s welding activities being performed on the cooling tower during its scheduled maintenance. The plant is currently shut down while repairs are being performed. As a result, on June 26, 2024, the lender granted Mahipapa a deferral of two scheduled (July 2024 and September 2024) principal and interest payments totaling $3 million. The deferred payments will be repaid in quarterly payments commencing in March 2025. Mahipapa will re-commence debt payments in December 2024.
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Shareholders' equity |
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Equity [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Shareholders' equity | Shareholders' equity Accumulated other comprehensive income/(loss). Changes in the balances of each component of accumulated other comprehensive income/(loss) (AOCI) were as follows:
Reclassifications out of AOCI were as follows:
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Revenues |
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Revenue from Contract with Customer [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Revenues | Revenues The following tables disaggregate revenues by major source, timing of revenue recognition, and segment:
There are no material contract assets or liabilities associated with revenues from contracts with customers existing at December 31, 2023 or as of June 30, 2024. Accounts receivable and unbilled revenues related to contracts with customers represent an unconditional right to consideration since all performance obligations have been satisfied. These amounts are disclosed as accounts receivable and unbilled revenues, net on HEI’s condensed consolidated balance sheets and customer accounts receivable, net and accrued unbilled revenues, net on Hawaiian Electric’s condensed consolidated balance sheets. As of June 30, 2024, the Company had no material remaining performance obligations due to the nature of the Company’s contracts with its customers. For the Utilities, performance obligations are fulfilled as electricity is delivered to customers. For ASB, fees are recognized when a transaction is completed.
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Retirement benefits |
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Retirement Benefits [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Retirement benefits | Retirement benefits Defined benefit pension and other postretirement benefit plans information. The Company contributed $3 million ($3 million by the Utilities) to its pension and other postretirement benefit plans during the first six months of 2024, compared to $4 million ($4 million by the Utilities) in the first six months of 2023. The Company’s current estimate of total contributions to its pension and other postretirement benefit plans in 2024 is comparable to 2023 at $8 million ($8 million by the Utilities). In addition, in 2024, comparable to 2023, the Company expects to pay directly $3 million ($1 million by the Utilities) of benefits. The components of net periodic pension costs (NPPC) and net periodic benefit costs (NPBC) for HEI consolidated and Hawaiian Electric consolidated were as follows:
HEI consolidated recorded retirement benefits expense of $23 million ($23 million by the Utilities) in the first six months of 2024 and $22 million ($22 million by the Utilities) in the first six months of 2023 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, any actual costs determined in accordance with GAAP that are over/under amounts allowed in rates are charged/credited to a regulatory asset/liability. The regulatory asset/liability for each utility will then be amortized over five years beginning with the respective utility’s next rate case. Defined contribution plans information. For the first six months of 2024 and 2023, the Company’s expenses for its defined contribution plans under the Hawaiian Electric Industries Retirement Savings Plan (HEIRSP) and the ASB 401(k) Plan were $5.8 million and $4.2 million, respectively, and cash contributions were $5.8 million and $5.0 million, respectively. For the first six months of 2024 and 2023, the Utilities’ expenses and cash contributions for its defined contribution plan under the HEIRSP were $3.5 million and $2.6 million, respectively.
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Share-based compensation |
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Share-based compensation | Share-based compensation Under the 2010 Equity and Incentive Plan, as amended and restated effective February 9, 2024 (EIP), HEI can issue shares of common stock as incentive compensation to non-employee directors and selected employees and consultants in the form of stock options, stock appreciation rights, restricted shares, restricted stock units, performance shares and other share-based and cash-based awards. As of June 30, 2024, approximately 2.5 million shares remained available for future issuance under the terms of the EIP, assuming recycling of shares withheld to satisfy statutory tax liabilities relating to EIP awards, including an estimated 0.9 million shares that could be issued upon the vesting of outstanding restricted stock units and the achievement of performance goals for awards outstanding under long-term incentive plans (assuming that such performance goals are achieved at maximum levels). Under the 2011 Nonemployee Director Stock Plan (2011 Director Plan), HEI can issue shares of common stock as compensation to nonemployee directors of HEI, Hawaiian Electric and ASB. As of June 30, 2024, there were 168,177 shares remaining available for future issuance under the 2011 Director Plan. Share-based compensation expense and the related income tax benefit were as follows:
1 For the three and six months ended June 30, 2024 and 2023, the Company has not capitalized any share-based compensation. Stock awards. HEI granted HEI common stock to nonemployee directors under the 2011 Director Plan as follows:
The number of shares issued to each nonemployee director of HEI, Hawaiian Electric and ASB is determined based on the closing price of HEI common stock on the grant date. Restricted stock units. Information about HEI’s grants of restricted stock units was as follows:
(1) Weighted-average grant-date fair value per share based on the average price of HEI common stock on the date of grant. For the six months ended June 30, 2024 and 2023, total restricted stock units and related dividends that vested had a fair value of $1.4 million and $3.7 million, respectively, and the related tax benefits were $0.3 million and $0.8 million, respectively. As of June 30, 2024, there was $2.8 million of total unrecognized compensation cost related to the nonvested restricted stock units. The cost is expected to be recognized over a weighted-average period of 1.4 years. Long-term incentive plan payable in stock. The 2022-24, 2023-25 and 2024-26 long-term incentive plans (LTIP) provide for performance awards under the EIP of shares of HEI common stock based on the satisfaction of performance goals, including a market condition goal. The number of shares of HEI common stock that may be awarded is fixed on the date the grants are made, subject to the achievement of specified performance levels and calculated dividend equivalents. The potential payout varies from 0% to 200% of the number of target shares, depending on the achievement of the goals. The market condition goal is based on HEI’s total shareholder return (TSR) compared to the Peer Group (Edison Electric Institute Index (EEI Index) for the 2022-24 performance period, and compared to the Company's compensation peer group consisting of companies in the EEI Index and approved by the Company's Compensation and Human Capital Management Committee for the 2023-25 and 2024-26 performance periods), in each case over the relevant three-year period. The other performance condition goals relate to EPS growth, cumulative EPS, return on average common equity (ROACE), carbon emissions reduction, Hawaiian Electric’s net income growth, credit rating and public safety, ASB’s efficiency ratio and strategic initiatives and Pacific Current’s EBITDA growth and return on average invested capital. LTIP linked to TSR. Information about HEI’s LTIP grants linked to TSR was as follows:
(1) Weighted-average grant-date fair value per share determined using a Monte Carlo simulation model. The grant date fair values of the shares were determined using a Monte Carlo simulation model utilizing actual information for the common shares of HEI and the Peer Group for the period from the beginning of the performance period to the grant date and estimated future stock volatility of HEI and the Peer Group over the remaining three-year performance period. The expected stock volatility assumptions for HEI and the Peer Group were based on the three-year historic stock volatility. A dividend assumption is not required for the Monte Carlo simulation because the grant payout includes dividend equivalents and projected returns include the value of reinvested dividends. The following table summarizes the assumptions used to determine the fair value of the LTIP awards linked to TSR and the resulting fair value of LTIP awards granted:
There were no share-based LTIP awards linked to TSR with a vesting date in 2024 and 2023. As of June 30, 2024, there was $1.8 million of total unrecognized compensation cost related to the nonvested performance awards payable in shares linked to TSR. The cost is expected to be recognized over a weighted-average period of 1.9 years. LTIP awards linked to other performance conditions. Information about HEI’s LTIP awards payable in shares linked to other performance conditions was as follows:
(1) Weighted-average grant-date fair value per share based on the average price of HEI common stock on the date of grant. For the six months ended June 30, 2024 and 2023, total vested LTIP awards linked to other performance conditions and related dividends had a fair value of $1.7 million and $2.9 million, respectively, and the related tax benefits were $0.4 million and $0.6 million, respectively. As of June 30, 2024, there was $6.5 million of total unrecognized compensation cost related to the nonvested shares linked to performance conditions other than TSR. The cost is expected to be recognized over a weighted-average period of 1.9 years.
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Income taxes |
6 Months Ended |
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Jun. 30, 2024 | |
Income Tax Disclosure [Abstract] | |
Income taxes | Income taxes The Company’s and the Utilities’ effective tax rates (combined federal and state income tax rates) for the six months ended June 30, 2024 were 26% tax benefit. These rates differed from the combined statutory rates, due primarily to the accrual of the Utilities’ best estimate of payments to settle Wildfire tort-related claims which resulted in a substantial pretax loss, Utilities’ amortization of excess deferred income taxes related to the provision in the 2017 Tax Cuts and Jobs Act that lowered the federal income tax rate from 35% to 21%, the tax benefits derived from the low income housing tax credit investments and the non-taxability of the bank-owned life insurance income. In August 2020, the Internal Revenue Service notified the Company that its 2017 and 2018 income tax returns would be examined. The Company was previously audited every year through 2011, at which time the IRS changed their internal policies regarding audit frequency. In May 2024, the IRS proposed a disallowance of $8.5 million from the $12.9 million of additional R&D tax credits claimed for the 2016 to 2018 tax years. The Company is currently reviewing this proposal to determine its next steps. The Inflation Reduction Act of 2022 (IRA) was signed by President Biden on August 16, 2022. Key provisions under the IRA include a 15% corporate alternative minimum tax (CAMT) imposed on certain large corporations and a 1% excise tax on stock repurchases after December 31, 2022. Based on current interpretation of the law and current guidance available, the Company does not believe HEI will be impacted by the CAMT or stock repurchase excise tax provisions. The IRA also creates new tax credits and enhances others to stimulate investment in renewable energy sources. Certain provisions of the IRA became effective in tax year 2023. The Company is exploring clean energy tax incentives included in the IRA.
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Cash flows |
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Supplemental Cash Flow Elements [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Cash flows | Cash flows
1 The amounts shown represent the market value of common stock issued for director and executive/management compensation and withheld to satisfy statutory tax liabilities.
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Fair value measurements |
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Fair Value Disclosures [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Fair value measurements | Fair value measurements Fair value measurement and disclosure valuation methodology. The following are descriptions of the valuation methodologies used for assets and liabilities recorded at fair value and for estimating fair value for financial instruments not carried at fair value: Investment securities. The fair value of ASB’s investment securities is determined quarterly through pricing obtained from independent third-party pricing services or from brokers not affiliated with the trade. Non-binding broker quotes are infrequent and generally occur for new securities that are settled close to the month-end pricing date. The third-party pricing vendors ASB uses for pricing its securities are reputable firms that provide pricing services on a global basis and have processes in place to ensure quality and control. The third-party pricing services use a variety of methods to determine the fair value of securities that fall under Level 2 of ASB’s fair value measurement hierarchy. Among the considerations are quoted prices for similar securities in an active market, yield spreads for similar trades, adjustments for liquidity, size, collateral characteristics, historic and generic prepayment speeds, and other observable market factors. To enhance the robustness of the pricing process, ASB will on a quarterly basis compare its standard third-party vendor’s price with that of another third-party vendor. If the prices are within an acceptable tolerance range, the price of the standard vendor will be accepted. If the variance is beyond the tolerance range, an evaluation will be conducted by ASB and a challenge to the price may be made. Fair value in such cases will be based on the value that best reflects the data and observable characteristics of the security. In all cases, the fair value used will have been independently determined by a third-party pricing vendor or non-affiliated broker. The fair value of the mortgage revenue bonds is estimated using a discounted cash flow model to calculate the present value of future principal and interest payments and, therefore is classified within Level 3 of the valuation hierarchy. Loans held for sale. Residential and commercial loans are carried at the lower of cost or market and are valued using market observable pricing inputs, which are derived from third party loan sales and, therefore, are classified within Level 2 of the valuation hierarchy. Loans held for investment. Fair value of loans held for investment is derived using a discounted cash flow approach which includes an evaluation of the underlying loan characteristics. The valuation model uses loan characteristics which includes product type, maturity dates and the underlying interest rate of the portfolio. This information is input into the valuation models along with various forecast valuation assumptions including prepayment forecasts, to determine the discount rate. These assumptions are derived from internal and third party sources. Since the valuation is derived from model-based techniques, ASB includes loans held for investment within Level 3 of the valuation hierarchy. Collateral dependent loans. Collateral dependent loans have been adjusted to fair value. When a loan is identified as collateral dependent, the Company measures the impairment using the current fair value of the collateral, less selling costs. Depending on the characteristics of a loan, the fair value of collateral is generally estimated by obtaining external appraisals, but in some cases, the value of the collateral may be estimated as having little or no value. Non-real estate collateral may be valued using an appraisal, net book value per the borrower’s financial statements, or aging reports, adjusted or discounted based on management’s historical knowledge, changes in market conditions from the time of the valuation and management’s expertise and knowledge of the client and client’s business, resulting in a Level 3 fair value classification. If it is determined that the value of the collateral dependent loan is less than its recorded investment, the Company recognizes this impairment and adjusts the carrying value of the loan to fair value through the allowance for credit losses. Real estate acquired in settlement of loans. Foreclosed assets are initially measured at fair value (less estimated costs to sell) and subsequently measured at the lower of the carrying value or fair value less selling costs. Fair values are generally based upon appraisals or independent market prices that are periodically updated subsequent to classification as real estate owned. Such adjustments typically result in a Level 3 classification of the inputs for determining fair value. ASB estimates the fair value of collateral-dependent loans and real estate owned using the sales comparison approach. Mortgage servicing rights. MSRs are capitalized at fair value based on market data at the time of sale and accounted for in subsequent periods at the lower of amortized cost or fair value. MSRs are evaluated for impairment at each reporting date. ASB's MSRs are stratified based on predominant risk characteristics of the underlying loans including loan type and note rate. For each stratum, fair value is calculated by discounting expected net income streams using discount rates that reflect industry pricing for similar assets. Expected net income streams are estimated based on industry assumptions regarding prepayment expectations and income and expenses associated with servicing residential mortgage loans for others. Impairment is recognized through a valuation allowance for each stratum when the carrying amount exceeds fair value, with any associated provision recorded as a component of loan servicing fees included in “Revenues - bank” in the consolidated statements of income. A direct write-down is recorded when the recoverability of the valuation allowance is deemed to be unrecoverable. ASB compares the fair value of MSRs to an estimated value calculated by an independent third-party. The third-party relies on both published and unpublished sources of market related assumptions and its own experience and expertise to arrive at a value. ASB uses the third-party value only to assess the reasonableness of its own estimate. ASB includes MSRs within Level 3 of the valuation hierarchy. Time certificates. The fair value of fixed-maturity certificates of deposit was estimated by discounting the future cash flows using the rates currently offered for FHLB advances of similar remaining maturities. Deposit liabilities are classified in Level 2 of the valuation hierarchy. Other borrowings. For advances, repurchase agreements and other bank borrowings, fair value is estimated using quantitative discounted cash flow models that require the use of interest rate inputs that are currently offered for advances, repurchase agreements and other bank borrowings of similar remaining maturities. The majority of market inputs are actively quoted and can be validated through external sources, including broker market transactions and third party pricing services. Long-term debt—other than bank. Fair value of fixed-rate long-term debt—other than bank was obtained from third-party financial services providers based on the current rates offered for debt of the same or similar remaining maturities and from discounting the future cash flows using the current rates offered for debt of the same or similar risks, terms, and remaining maturities. The carrying amount of floating rate long-term debt—other than bank approximated fair value because of the short-term interest reset periods. Long-term debt—other than bank is classified in Level 2 of the valuation hierarchy. Interest rate lock commitments (IRLCs). The estimated fair value of commitments to originate residential mortgage loans for sale is based on quoted prices for similar loans in active markets. IRLCs are classified as Level 2 measurements. Forward sales commitments. To be announced (TBA) mortgage-backed securities forward commitments are classified as Level 1, and consist of publicly-traded debt securities for which identical fair values can be obtained through quoted market prices in active exchange markets. The fair values of ASB’s best efforts and mandatory delivery loan sale commitments are determined using quoted prices in the marketplace that are observable and are classified as Level 2 measurements. Interest rate swaps. The Company measures its interest rate swaps at fair value. The fair values of the Company's interest rate swaps are based on the estimated amounts that the Company would receive or pay to terminate the contracts at the reporting date and are determined using interest rate pricing models and interest rate related observable inputs. The fair values of the Company's interest rate swaps are classified as a Level 2 measurements. The following table presents the carrying or notional amount, fair value and placement in the fair value hierarchy of the Company’s financial instruments.
Fair value measurements on a recurring basis. Assets and liabilities measured at fair value on a recurring basis were as follows:
1 Derivatives are carried at fair value in other assets or other liabilities in the balance sheets with changes in value included in mortgage banking income. 2 Derivatives are included in other assets and other liabilities in the balance sheets. There were no transfers of financial assets and liabilities between Level 1 and Level 2 of the fair value hierarchy during the six months ended June 30, 2024 and 2023. The changes in Level 3 assets and liabilities measured at fair value on a recurring basis were as follows:
Mortgage revenue bonds are issued by the Department of Budget and Finance of the State of Hawaii. The Company estimates the fair value by using a discounted cash flow model to calculate the present value of estimated future principal and interest payments. The unobservable input used in the fair value measurement is the weighted average discount rate. As of June 30, 2024, the weighted average discount rate was 5.65%, which was derived by incorporating a credit spread over the one month SOFR. Significant increases (decreases) in the weighted average discount rate could result in a significantly lower (higher) fair value measurement. Fair value measurements on a nonrecurring basis. Certain assets and liabilities are measured at fair value on a nonrecurring basis and therefore are not included in the tables above. These measurements primarily result from assets carried at the lower of cost or fair value or from impairment of individual assets. As of June 30, 2024 and December 31, 2023, there were no financial instruments measured at fair value on a nonrecurring basis. For the six months ended June 30, 2024 and 2023, there were no adjustments to fair value for ASB’s loans held for sale.
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Basis of presentation (Policies) |
6 Months Ended |
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Jun. 30, 2024 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Basis of presentation | The accompanying unaudited condensed consolidated financial statements have been prepared assuming that the Company will continue as a going concern and in conformity with accounting principles generally accepted in the United States of America (GAAP) for interim financial information, the instructions to SEC Form 10-Q and Article 10 of Regulation S-X. Accordingly, they do not include all of the information and footnotes required by GAAP for complete financial statements. In preparing the unaudited condensed consolidated financial statements, management is required to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the balance sheet and the reported amounts of revenues and expenses for the period. Actual results could differ significantly from those estimates. |
Recent accounting pronouncements | Recent accounting pronouncements. Segment Reporting. In November 2023, the FASB issued ASU No. 2023-07, Segment Reporting (Topic 280): Improvements to Reportable Segment Disclosures to improve reportable segment disclosure requirements, primarily through enhanced disclosure requirements of significant segment expenses. These amendments are effective for annual periods beginning after December 15, 2023 and interim periods within fiscal years beginning after December 15, 2024. Early adoption is permitted. These amendments apply on a retrospective basis. The Company is currently evaluating the impact of this amendment on the Company’s consolidated financial statements. Income Taxes. In December 2023, the FASB issued ASU No. 2023-09, Income Taxes (Topic 740): Improvement to Income Tax Disclosures to enhance the transparency and decision usefulness of income tax disclosures. The amendments are effective for annual periods beginning after December 15, 2024. These amendments apply on a prospective basis with a retrospective option. Early adoption is permitted. The Company is currently evaluating the impact of this amendment on the Company’s consolidated financial statements. Climate-related disclosures. In March 2024, the Securities and Exchange Commission (SEC) issued final climate-related disclosure rules under SEC Release No. 33-11275, The Enhancement and Standardization of Climate-Related Disclosures for Investors (climate disclosure rules). The rules will require annual disclosure of material greenhouse gas emissions as well as disclosure of governance, risk management and strategy related to material climate-related risks. In addition, the rules require (i) financial statement impacts of severe weather events and other natural conditions; (ii) a roll forward of carbon offset and renewable energy credit balances if material to the Company’s plan to achieve climate-related targets or goals; and (iii) material impacts on estimates and assumptions in the financial statements. The disclosure requirements will begin phasing in for annual periods beginning with calendar year 2025. The Company is currently evaluating the final rule to determine its impact on the Company’s consolidated financial statements. In April 2024, the SEC voluntarily stayed implementation of its climate disclosure rules pending completion of judicial review by the Court of Appeals for the Eighth Circuit.
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Reclassifications | Reclassifications. Reclassifications of prior year Wildfire tort-related claims amounts were reclassified from “Other liabilities” and “Other current liabilities” for the Company and the Utilities, respectively, to conform to the current year financial statement presentation. Reclassifications did not affect previously reported cash flows, net income or retained earnings.
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Fair value measurements | The following are descriptions of the valuation methodologies used for assets and liabilities recorded at fair value and for estimating fair value for financial instruments not carried at fair value: Investment securities. The fair value of ASB’s investment securities is determined quarterly through pricing obtained from independent third-party pricing services or from brokers not affiliated with the trade. Non-binding broker quotes are infrequent and generally occur for new securities that are settled close to the month-end pricing date. The third-party pricing vendors ASB uses for pricing its securities are reputable firms that provide pricing services on a global basis and have processes in place to ensure quality and control. The third-party pricing services use a variety of methods to determine the fair value of securities that fall under Level 2 of ASB’s fair value measurement hierarchy. Among the considerations are quoted prices for similar securities in an active market, yield spreads for similar trades, adjustments for liquidity, size, collateral characteristics, historic and generic prepayment speeds, and other observable market factors. To enhance the robustness of the pricing process, ASB will on a quarterly basis compare its standard third-party vendor’s price with that of another third-party vendor. If the prices are within an acceptable tolerance range, the price of the standard vendor will be accepted. If the variance is beyond the tolerance range, an evaluation will be conducted by ASB and a challenge to the price may be made. Fair value in such cases will be based on the value that best reflects the data and observable characteristics of the security. In all cases, the fair value used will have been independently determined by a third-party pricing vendor or non-affiliated broker. The fair value of the mortgage revenue bonds is estimated using a discounted cash flow model to calculate the present value of future principal and interest payments and, therefore is classified within Level 3 of the valuation hierarchy. Loans held for sale. Residential and commercial loans are carried at the lower of cost or market and are valued using market observable pricing inputs, which are derived from third party loan sales and, therefore, are classified within Level 2 of the valuation hierarchy. Loans held for investment. Fair value of loans held for investment is derived using a discounted cash flow approach which includes an evaluation of the underlying loan characteristics. The valuation model uses loan characteristics which includes product type, maturity dates and the underlying interest rate of the portfolio. This information is input into the valuation models along with various forecast valuation assumptions including prepayment forecasts, to determine the discount rate. These assumptions are derived from internal and third party sources. Since the valuation is derived from model-based techniques, ASB includes loans held for investment within Level 3 of the valuation hierarchy. Collateral dependent loans. Collateral dependent loans have been adjusted to fair value. When a loan is identified as collateral dependent, the Company measures the impairment using the current fair value of the collateral, less selling costs. Depending on the characteristics of a loan, the fair value of collateral is generally estimated by obtaining external appraisals, but in some cases, the value of the collateral may be estimated as having little or no value. Non-real estate collateral may be valued using an appraisal, net book value per the borrower’s financial statements, or aging reports, adjusted or discounted based on management’s historical knowledge, changes in market conditions from the time of the valuation and management’s expertise and knowledge of the client and client’s business, resulting in a Level 3 fair value classification. If it is determined that the value of the collateral dependent loan is less than its recorded investment, the Company recognizes this impairment and adjusts the carrying value of the loan to fair value through the allowance for credit losses. Real estate acquired in settlement of loans. Foreclosed assets are initially measured at fair value (less estimated costs to sell) and subsequently measured at the lower of the carrying value or fair value less selling costs. Fair values are generally based upon appraisals or independent market prices that are periodically updated subsequent to classification as real estate owned. Such adjustments typically result in a Level 3 classification of the inputs for determining fair value. ASB estimates the fair value of collateral-dependent loans and real estate owned using the sales comparison approach. Mortgage servicing rights. MSRs are capitalized at fair value based on market data at the time of sale and accounted for in subsequent periods at the lower of amortized cost or fair value. MSRs are evaluated for impairment at each reporting date. ASB's MSRs are stratified based on predominant risk characteristics of the underlying loans including loan type and note rate. For each stratum, fair value is calculated by discounting expected net income streams using discount rates that reflect industry pricing for similar assets. Expected net income streams are estimated based on industry assumptions regarding prepayment expectations and income and expenses associated with servicing residential mortgage loans for others. Impairment is recognized through a valuation allowance for each stratum when the carrying amount exceeds fair value, with any associated provision recorded as a component of loan servicing fees included in “Revenues - bank” in the consolidated statements of income. A direct write-down is recorded when the recoverability of the valuation allowance is deemed to be unrecoverable. ASB compares the fair value of MSRs to an estimated value calculated by an independent third-party. The third-party relies on both published and unpublished sources of market related assumptions and its own experience and expertise to arrive at a value. ASB uses the third-party value only to assess the reasonableness of its own estimate. ASB includes MSRs within Level 3 of the valuation hierarchy. Time certificates. The fair value of fixed-maturity certificates of deposit was estimated by discounting the future cash flows using the rates currently offered for FHLB advances of similar remaining maturities. Deposit liabilities are classified in Level 2 of the valuation hierarchy. Other borrowings. For advances, repurchase agreements and other bank borrowings, fair value is estimated using quantitative discounted cash flow models that require the use of interest rate inputs that are currently offered for advances, repurchase agreements and other bank borrowings of similar remaining maturities. The majority of market inputs are actively quoted and can be validated through external sources, including broker market transactions and third party pricing services. Long-term debt—other than bank. Fair value of fixed-rate long-term debt—other than bank was obtained from third-party financial services providers based on the current rates offered for debt of the same or similar remaining maturities and from discounting the future cash flows using the current rates offered for debt of the same or similar risks, terms, and remaining maturities. The carrying amount of floating rate long-term debt—other than bank approximated fair value because of the short-term interest reset periods. Long-term debt—other than bank is classified in Level 2 of the valuation hierarchy. Interest rate lock commitments (IRLCs). The estimated fair value of commitments to originate residential mortgage loans for sale is based on quoted prices for similar loans in active markets. IRLCs are classified as Level 2 measurements. Forward sales commitments. To be announced (TBA) mortgage-backed securities forward commitments are classified as Level 1, and consist of publicly-traded debt securities for which identical fair values can be obtained through quoted market prices in active exchange markets. The fair values of ASB’s best efforts and mandatory delivery loan sale commitments are determined using quoted prices in the marketplace that are observable and are classified as Level 2 measurements. Interest rate swaps. The Company measures its interest rate swaps at fair value. The fair values of the Company's interest rate swaps are based on the estimated amounts that the Company would receive or pay to terminate the contracts at the reporting date and are determined using interest rate pricing models and interest rate related observable inputs. The fair values of the Company's interest rate swaps are classified as a Level 2 measurements.
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Maui windstorm and wildfires (Tables) |
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---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Jun. 30, 2024 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Unusual or Infrequent Items, or Both [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Windstorm and Wildfire Expenses | See table below for the incremental expenses related to the Maui windstorm and wildfires.
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Segment financial information (Tables) |
6 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Jun. 30, 2024 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Segment Reporting [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Segment Financial Information |
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Electric utility segment (Tables) |
6 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Jun. 30, 2024 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Electric Utility Subsidiary [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Purchases From All IPPs | Purchases from all IPPs were as follows:
1 Includes hydro power and other PPAs.
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Schedule of Net Annual Incremental Amounts Proposed to be Collected (Refunded) |
The net incremental amounts between the 2023 fall and 2024 spring revenue reports are shown in the following table. The amounts are to be collected (refunded) from June 1, 2024 through May 31, 2025 under the RBA rate tariffs, which were included in the 2024 spring revenue report filing.
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Schedule of Condensed Consolidating Statements of Income |
Statements of Income and Comprehensive Income Data
Reconciliation to amounts per HEI Condensed Consolidated Statements of Income*:
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Schedule of Condensed Consolidating Statement of Comprehensive Income |
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Schedule of Condensed Consolidating Balance Sheet |
(continued) Hawaiian Electric Company, Inc. and Subsidiaries Condensed Consolidating Balance Sheet (continued) June 30, 2024
(continued) Hawaiian Electric Company, Inc. and Subsidiaries Condensed Consolidating Balance Sheet (continued) December 31, 2023
Balance Sheets Data
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Schedule of Condensed Consolidating Statement of Changes in Common Stock Equity |
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Schedule of Condensed Consolidating Statement of Cash Flows |
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Bank segment (Tables) |
6 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Jun. 30, 2024 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Bank Subsidiary [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Statements of Income Data |
Statements of Income and Comprehensive Income Data
Reconciliation to amounts per HEI Condensed Consolidated Statements of Income*:
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Schedule of Statements of Comprehensive Income Data | Statements of Income and Comprehensive Income Data
Reconciliation to amounts per HEI Condensed Consolidated Statements of Income*:
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Schedule of Balance Sheets Data |
(continued) Hawaiian Electric Company, Inc. and Subsidiaries Condensed Consolidating Balance Sheet (continued) June 30, 2024
(continued) Hawaiian Electric Company, Inc. and Subsidiaries Condensed Consolidating Balance Sheet (continued) December 31, 2023
Balance Sheets Data
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Schedule of the Book Value and Aggregate Fair Value by Major Security Type | The major components of investment securities were as follows:
* Issued or guaranteed by U.S. Government agencies or sponsored agencies
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Schedule of Contractual Maturities of Available-for-Sale Securities | The contractual maturities of investment securities were as follows:
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Schedule of Components of Loans Receivable | The components of loans were summarized as follows:
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Schedule of Allowance for Credit Losses | The allowance for credit losses (balances and changes) by portfolio segment were as follows:
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Schedule of Allowance for Loan Commitments | The allowance for loan commitments by portfolio segment were as follows:
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Schedule of Credit Risk Profile by Internally Assigned Grade for Loans | The credit risk profile by vintage date based on payment activity or internally assigned grade for loans was as follows:
Gross charge-offs by portfolio segment and vintage were as follows:
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Schedule of Credit Risk Profile Based on Payment Activity for Loans | The credit risk profile based on payment activity for loans was as follows:
Credit risk profile based on payment activity for loans modified during the six months ended June 30, 2024 were as follows:
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Schedule of Credit Risk Profile Based on Nonaccrual Loans, Accruing Loans 90 days or More Past Due | The credit risk profile based on nonaccrual loans were as follows:
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Schedule of Loan Modification | Loan modifications made to borrowers experiencing financial difficulty during the three and six months ended June 30, 2024 were as follows:
Financial effect of loan modifications during the three and six months ended June 30, 2024 for borrowers experiencing financial difficulty were as follows:
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Schedule of Collateral-Dependent Loans | Loans considered collateral-dependent were as follows:
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Schedule of Amortized Intangible Assets | Changes in the carrying value of MSRs were as follows:
Changes related to MSRs were as follows:
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Schedule of Key Assumptions Used in Estimating fair Value | Key assumptions used in estimating the fair value of ASB’s MSRs used in the impairment analysis were as follows:
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Schedule of Sensitivity Analysis of Fair Value, Transferor's Interests in Transferred Financial Assets | The sensitivity analysis of fair value of MSRs to hypothetical adverse changes of 25 and 50 basis points in certain key assumptions was as follows:
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Schedule of Notional and Fair Value of Derivatives | The notional amount and fair value of ASB’s derivative financial instruments were as follows:
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Schedule of Derivative Financial Instruments | ASB’s derivative financial instruments, their fair values and balance sheet location were as follows:
1 Asset derivatives are included in other assets and liability derivatives are included in other liabilities in the balance sheets.
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Schedule of Derivative Financial Instruments and Net Gain or Loss | The following table presents ASB’s derivative financial instruments and the amount and location of the net gains or losses recognized in ASB’s statements of income:
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Shareholders' equity (Tables) |
6 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Jun. 30, 2024 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Equity [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Accumulated Other Comprehensive Income | Changes in the balances of each component of accumulated other comprehensive income/(loss) (AOCI) were as follows:
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Schedule of Reclassification out of AOCI | Reclassifications out of AOCI were as follows:
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Revenues (Tables) |
6 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Jun. 30, 2024 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Revenue from Contract with Customer [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Disaggregation of Revenue | The following tables disaggregate revenues by major source, timing of revenue recognition, and segment:
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Retirement benefits (Tables) |
6 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Jun. 30, 2024 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Retirement Benefits [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Components of Net Periodic Benefit Cost for Consolidated HEI | The components of net periodic pension costs (NPPC) and net periodic benefit costs (NPBC) for HEI consolidated and Hawaiian Electric consolidated were as follows:
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Share-based compensation (Tables) |
6 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Jun. 30, 2024 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Share-Based Payment Arrangement [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Share-Based Compensation Expense and Related Income Tax Benefit | Share-based compensation expense and the related income tax benefit were as follows:
1 For the three and six months ended June 30, 2024 and 2023, the Company has not capitalized any share-based compensation.
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Schedule of Common Stock Granted to Nonemployee Directors | HEI granted HEI common stock to nonemployee directors under the 2011 Director Plan as follows:
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Schedule of Restricted Stock Units | Information about HEI’s grants of restricted stock units was as follows:
(1) Weighted-average grant-date fair value per share based on the average price of HEI common stock on the date of grant.
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Schedule of Long-Term Incentive Plan (LTIP) Linked to Total Return to Shareholders | Information about HEI’s LTIP grants linked to TSR was as follows:
(1) Weighted-average grant-date fair value per share determined using a Monte Carlo simulation model.
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Schedule of Long-Term Incentive Plan Assumptions | The following table summarizes the assumptions used to determine the fair value of the LTIP awards linked to TSR and the resulting fair value of LTIP awards granted:
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Schedule of Long-Term Incentive Plan (LTIP) Linked to Other Performance Conditions | Information about HEI’s LTIP awards payable in shares linked to other performance conditions was as follows:
(1) Weighted-average grant-date fair value per share based on the average price of HEI common stock on the date of grant.
|
Cash flows (Tables) |
6 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Jun. 30, 2024 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Supplemental Cash Flow Elements [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Supplemental Disclosures of Cash and Noncash Activity |
1 The amounts shown represent the market value of common stock issued for director and executive/management compensation and withheld to satisfy statutory tax liabilities.
|
Fair value measurements (Tables) |
6 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Jun. 30, 2024 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Fair Value Disclosures [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Carrying or Notional Amount, Fair Value and Placement in the Fair Value Hierarchy of the Company’s Financial Instruments | The following table presents the carrying or notional amount, fair value and placement in the fair value hierarchy of the Company’s financial instruments.
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Schedule of Assets Measured at Fair Value on a Recurring Basis | Assets and liabilities measured at fair value on a recurring basis were as follows:
1 Derivatives are carried at fair value in other assets or other liabilities in the balance sheets with changes in value included in mortgage banking income. 2 Derivatives are included in other assets and other liabilities in the balance sheets.
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Schedule of Changes in Level 3 Assets and Liabilities Measured at Fair Value on a Recurring Basis | The changes in Level 3 assets and liabilities measured at fair value on a recurring basis were as follows:
|
Basis of presentation (Details) - USD ($) $ in Thousands |
3 Months Ended | 6 Months Ended | |||||
---|---|---|---|---|---|---|---|
Jun. 30, 2024 |
Mar. 31, 2024 |
Jun. 30, 2023 |
Mar. 31, 2023 |
Jun. 30, 2024 |
Jun. 30, 2023 |
Dec. 31, 2023 |
|
Loss Contingencies [Line Items] | |||||||
Net income (loss) for common stock | $ (1,295,484) | $ 42,122 | $ 54,610 | $ 54,721 | $ (1,253,362) | $ 109,331 | |
Cash and cash equivalents | 550,408 | 314,284 | 550,408 | 314,284 | $ 679,546 | ||
Hawaiian Electric | |||||||
Loss Contingencies [Line Items] | |||||||
Cash and cash equivalents | 124,400 | 124,400 | |||||
Hawaiian Electric Company, Inc. and Subsidiaries | |||||||
Loss Contingencies [Line Items] | |||||||
Net income (loss) for common stock | (1,229,394) | $ 39,221 | 45,299 | $ 47,009 | (1,190,173) | 92,308 | |
Cash and cash equivalents | 88,620 | $ 143,647 | 88,620 | $ 143,647 | $ 106,077 | ||
Hawaiian Electric Company, Inc. and Subsidiaries | Wildfire tort-related claims | Natural Disasters and Other Casualty Events | |||||||
Loss Contingencies [Line Items] | |||||||
Estimated loss liabilities | $ 1,710,000 | $ 1,710,000 |
Segment financial information - Segment Financial Information (Details) - USD ($) $ in Thousands |
3 Months Ended | 6 Months Ended | |||||
---|---|---|---|---|---|---|---|
Jun. 30, 2024 |
Mar. 31, 2024 |
Jun. 30, 2023 |
Mar. 31, 2023 |
Jun. 30, 2024 |
Jun. 30, 2023 |
Dec. 31, 2023 |
|
Segment financial information | |||||||
Revenues | $ 897,360 | $ 895,685 | $ 1,794,518 | $ 1,823,922 | |||
Income (loss) before income taxes | (1,742,280) | 69,367 | (1,688,011) | 139,671 | |||
Income taxes (benefit) | (447,269) | 14,284 | (435,595) | 29,394 | |||
Net income (loss) | (1,295,011) | 55,083 | (1,252,416) | 110,277 | |||
Preferred stock dividends of Hawaiian Electric | 473 | 473 | 946 | 946 | |||
Net income (loss) for common stock | (1,295,484) | $ 42,122 | 54,610 | $ 54,721 | (1,253,362) | 109,331 | |
Total assets | 17,055,414 | 17,055,414 | $ 17,243,821 | ||||
Electric utility | |||||||
Segment financial information | |||||||
Revenues | 792,331 | 794,191 | 1,580,909 | 1,624,552 | |||
Income (loss) before income taxes | (1,658,653) | 58,868 | (1,607,753) | 119,976 | |||
Income taxes (benefit) | (429,758) | 13,070 | (418,578) | 26,670 | |||
Net income (loss) | (1,228,895) | 45,798 | (1,189,175) | 93,306 | |||
Preferred stock dividends of Hawaiian Electric | 499 | 499 | 998 | 998 | |||
Net income (loss) for common stock | (1,229,394) | 45,299 | (1,190,173) | 92,308 | |||
Total assets | 7,398,898 | 7,398,898 | 7,283,554 | ||||
Bank | |||||||
Segment financial information | |||||||
Revenues | 101,943 | 96,885 | 207,087 | 190,742 | |||
Income (loss) before income taxes | (57,106) | 25,055 | (31,293) | 48,762 | |||
Income taxes (benefit) | (11,319) | 4,851 | (6,440) | 9,996 | |||
Net income (loss) | (45,787) | 20,204 | (24,853) | 38,766 | |||
Preferred stock dividends of Hawaiian Electric | 0 | 0 | 0 | 0 | |||
Net income (loss) for common stock | (45,787) | 20,204 | (24,853) | 38,766 | |||
Total assets | 9,280,805 | 9,280,805 | 9,673,192 | ||||
Other | |||||||
Segment financial information | |||||||
Revenues | 3,086 | 4,609 | 6,522 | 8,628 | |||
Income (loss) before income taxes | (26,521) | (14,556) | (48,965) | (29,067) | |||
Income taxes (benefit) | (6,192) | (3,637) | (10,577) | (7,272) | |||
Net income (loss) | (20,329) | (10,919) | (38,388) | (21,795) | |||
Preferred stock dividends of Hawaiian Electric | (26) | (26) | (52) | (52) | |||
Net income (loss) for common stock | (20,303) | $ (10,893) | (38,336) | $ (21,743) | |||
Total assets | $ 375,711 | $ 375,711 | $ 287,075 |
Electric utility segment - Unconsolidated Variable Interest Entities (Details) |
6 Months Ended |
---|---|
Jun. 30, 2024
agreement
entity
| |
Power purchase agreement | |
Number of IPPs (in entities) | entity | 2 |
Hawaiian Electric Company | |
Power purchase agreement | |
Number of power purchase agreements (PPAs) (in agreements) | agreement | 4 |
Bank segment - Reconciliation of Income (Details) - USD ($) $ in Thousands |
3 Months Ended | 6 Months Ended | ||
---|---|---|---|---|
Jun. 30, 2024 |
Jun. 30, 2023 |
Jun. 30, 2024 |
Jun. 30, 2023 |
|
Condensed Income Statements, Captions [Line Items] | ||||
Revenues | $ 897,360 | $ 895,685 | $ 1,794,518 | $ 1,823,922 |
Less / Add back: Retirement defined benefits credit—other than service costs | (1,281) | (1,153) | (2,563) | (2,305) |
Total expenses | 2,616,335 | 802,706 | 3,437,074 | 1,637,425 |
Operating income - bank | (1,718,975) | 92,979 | (1,642,556) | 186,497 |
Loss before income taxes | (1,742,280) | 69,367 | (1,688,011) | 139,671 |
American Savings Bank (ASB) | ||||
Condensed Income Statements, Captions [Line Items] | ||||
Interest and dividend income | 86,178 | 81,741 | 174,113 | 161,220 |
Noninterest income | 15,765 | 15,639 | 32,974 | 30,017 |
Less: Gain on sale of real estate | 0 | 495 | 0 | 495 |
Revenues | 101,943 | 96,885 | 207,087 | 190,742 |
Total interest expense | 24,494 | 18,513 | 50,080 | 33,071 |
Provision for credit losses | (1,910) | 43 | (4,069) | 1,218 |
Noninterest expense | 136,465 | 53,769 | 192,369 | 108,186 |
Less / Add back: Retirement defined benefits credit—other than service costs | (280) | (187) | (561) | (374) |
Total expenses | 159,329 | 72,017 | 238,941 | 142,354 |
Operating income - bank | (57,386) | 24,868 | (31,854) | 48,388 |
Loss before income taxes | $ (57,106) | $ 25,055 | $ (31,293) | $ 48,762 |
Bank segment - Narrative (Details) - USD ($) |
3 Months Ended | 6 Months Ended | |||
---|---|---|---|---|---|
Jun. 30, 2024 |
Jun. 30, 2023 |
Jun. 30, 2024 |
Jun. 30, 2023 |
Dec. 31, 2023 |
|
Allowance for credit losses | |||||
Goodwill impairment | $ 82,190,000 | $ 0 | |||
Other bank borrowings | $ 520,000,000 | 520,000,000 | $ 750,000,000 | ||
American Savings Bank (ASB) | |||||
Allowance for credit losses | |||||
Goodwill impairment | 82,190,000 | $ 0 | $ 82,190,000 | 0 | |
Minimum benchmark percentage of loan to appraisal ratio which mortgage insurance is required | 80.00% | ||||
Unused line and letters of credits | 1,900,000,000 | $ 1,900,000,000 | |||
Advances from the FHLB | 520,000,000.0 | 520,000,000.0 | 200,000,000.0 | ||
American Savings Bank (ASB) | Federal Reserve Bank Advances | |||||
Allowance for credit losses | |||||
Other bank borrowings | $ 0 | 0 | $ 550,000,000.0 | ||
Home equity line of credit | |||||
Allowance for credit losses | |||||
Conversion of debt | 11,300,000 | 14,900,000 | |||
Commercial | |||||
Allowance for credit losses | |||||
Conversion of debt | 1,900,000 | 2,000,000.0 | |||
Consumer | |||||
Allowance for credit losses | |||||
Conversion of debt | $ 400,000 | $ 900,000 |
Bank segment - Allowance for Loan Commitments (Details) - USD ($) $ in Thousands |
3 Months Ended | 6 Months Ended | ||
---|---|---|---|---|
Jun. 30, 2024 |
Jun. 30, 2023 |
Jun. 30, 2024 |
Jun. 30, 2023 |
|
Allowance for loan commitments: | ||||
Beginning balance | $ 4,100 | $ 4,400 | $ 5,100 | $ 4,400 |
Provision | 100 | 200 | (900) | 200 |
Ending balance | 4,200 | 4,600 | 4,200 | 4,600 |
Real estate | Home equity line of credit | ||||
Allowance for loan commitments: | ||||
Beginning balance | 600 | 400 | 600 | 400 |
Provision | 100 | 200 | 100 | 200 |
Ending balance | 700 | 600 | 700 | 600 |
Real estate | Commercial construction | ||||
Allowance for loan commitments: | ||||
Beginning balance | 3,100 | 2,600 | 4,300 | 2,600 |
Provision | 0 | 1,200 | (1,200) | 1,200 |
Ending balance | 3,100 | 3,800 | 3,100 | 3,800 |
Commercial | ||||
Allowance for loan commitments: | ||||
Beginning balance | 400 | 1,400 | 200 | 1,400 |
Provision | 0 | (1,200) | 200 | (1,200) |
Ending balance | $ 400 | $ 200 | $ 400 | $ 200 |
Bank segment - Financial Effect of Loan Modification (Details) - Real estate |
3 Months Ended | 6 Months Ended |
---|---|---|
Jun. 30, 2024 |
Jun. 30, 2024 |
|
Residential 1-4 family | Term extension | ||
Financing Receivable, Modified [Line Items] | ||
Weighted average | 114 months | 149 months |
Residential 1-4 family | Payment delay | ||
Financing Receivable, Modified [Line Items] | ||
Weighted average | 11 months | 10 months |
Commercial real estate | Term extension | ||
Financing Receivable, Modified [Line Items] | ||
Weighted average | 9 months | |
Commercial real estate | Payment delay | ||
Financing Receivable, Modified [Line Items] | ||
Weighted average | 9 months | |
Home equity line of credit | Payment delay | ||
Financing Receivable, Modified [Line Items] | ||
Weighted average | 9 months | |
Residential land | Payment delay | ||
Financing Receivable, Modified [Line Items] | ||
Weighted average | 9 months |
Bank segment - Other Borrowings (Details) - USD ($) $ in Thousands |
Jun. 30, 2024 |
Dec. 31, 2023 |
---|---|---|
Offsetting Liabilities [Line Items] | ||
Other bank borrowings | $ 520,000 | $ 750,000 |
American Savings Bank (ASB) | ||
Offsetting Liabilities [Line Items] | ||
Advances from the FHLB | $ 520,000 | $ 200,000 |
Bank segment - Contingencies (Details) - USD ($) $ in Millions |
Jun. 30, 2024 |
Dec. 31, 2023 |
---|---|---|
American Savings Bank (ASB) | ||
Loss Contingencies [Line Items] | ||
Unfunded commitments to fund the company's LIHTC | $ 87.2 | $ 87.9 |
Share-based compensation - Share-Based Compensation Expense and Related Income Tax Benefit (Details) - USD ($) $ in Millions |
3 Months Ended | 6 Months Ended | ||
---|---|---|---|---|
Jun. 30, 2024 |
Jun. 30, 2023 |
Jun. 30, 2024 |
Jun. 30, 2023 |
|
Share-based compensation | ||||
Share-based compensation expense | $ 1.8 | $ 3.9 | $ 3.1 | $ 5.9 |
Income tax benefit | 0.2 | 0.8 | 0.3 | 1.1 |
Hawaiian Electric Company, Inc. and Subsidiaries | ||||
Share-based compensation | ||||
Share-based compensation expense | 0.8 | 1.1 | 1.2 | 1.7 |
Income tax benefit | $ 0.1 | $ 0.2 | $ 0.1 | $ 0.4 |
Share-based compensation - Common Stock Granted to Nonemployee Directors (Details) - USD ($) $ in Millions |
3 Months Ended | 6 Months Ended | ||
---|---|---|---|---|
Jun. 30, 2024 |
Jun. 30, 2023 |
Jun. 30, 2024 |
Jun. 30, 2023 |
|
Share-based compensation | ||||
Income tax benefit | $ 0.2 | $ 0.8 | $ 0.3 | $ 1.1 |
Common stock | ||||
Share-based compensation | ||||
Shares granted (in shares) | 0 | 38,941 | 0 | 40,450 |
Fair value | $ 0.0 | $ 1.4 | $ 0.0 | $ 1.5 |
Income tax benefit | $ 0.0 | $ 0.4 | $ 0.0 | $ 0.4 |
Share-based compensation - Fair Value Assumptions (Details) - LTIP linked to TRS - $ / shares |
6 Months Ended | |
---|---|---|
Jun. 30, 2024 |
Jun. 30, 2023 |
|
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Risk-free interest rate | 4.25% | 4.19% |
Expected life in years | 3 years | 3 years |
Expected volatility | 52.50% | 33.10% |
Range of expected volatility for Peer Group, minimum rate | 12.30% | 28.70% |
Range of expected volatility for Peer Group, maximum rate | 52.50% | 38.80% |
Grant-date fair value (in dollars per share) | $ 17.28 | $ 55.98 |
Income taxes (Details) - USD ($) $ in Millions |
6 Months Ended | |
---|---|---|
Jun. 30, 2024 |
May 31, 2024 |
|
Income Tax Contingency [Line Items] | ||
Effective income tax, percent | 26.00% | |
Tax Year 2016 To 2018 | ||
Income Tax Contingency [Line Items] | ||
Research and development tax credit that are proposed to be disallowed | $ 8.5 | |
Research and development tax credits | $ 12.9 |
Fair value measurements - Changes in Level 3 Assets and Liabilities Measured at Fair Value on a Recurring Basis (Details) - Mortgage revenue bonds - USD ($) $ in Thousands |
3 Months Ended | 6 Months Ended | ||
---|---|---|---|---|
Jun. 30, 2024 |
Jun. 30, 2023 |
Jun. 30, 2024 |
Jun. 30, 2023 |
|
Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation, Calculation [Roll Forward] | ||||
Beginning balance | $ 14,217 | $ 14,766 | $ 14,358 | $ 14,902 |
Principal payments received | (141) | (136) | (282) | (272) |
Purchases | 0 | 0 | 0 | 0 |
Unrealized gain (loss) included in other comprehensive income | 0 | 0 | 0 | 0 |
Ending balance | $ 14,076 | $ 14,630 | $ 14,076 | $ 14,630 |
Fair value measurements - Narrative (Details) |
6 Months Ended | |
---|---|---|
Jun. 30, 2024
USD ($)
|
Jun. 30, 2023
USD ($)
|
|
Fair value measurements on a nonrecurring basis | American Savings Bank (ASB) | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Adjustments to fair value of loans held for sale | $ 0 | $ 0 |
Weighted average discount rate | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Mortgage revenue bonds, measurement input | 0.0565 |
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