“Hawaii state government officials and Hawaii Electric Co., were both acutely aware of the wildfire threat in Maui. Yet state regulators did not force action to mitigate the threat, and Hawaii Electric, the largest utility interest in the state and the island’s largest publicly traded company, did little to address the problem.
The two interests are deeply entwined, ethics and business records show.
Every member of the Hawaii Public Utilities Commission, which regulates Hawaii Electric, has financial or previous professional ties to the company.
Instead of action on wildfire upgrades, Hawaii Electric splurged on peddling influence with regulators and politicians while singing its own virtues in splashy corporate marketing materials. The company even sponsored a documentary this year on Hawaiian television devoted to mitigating the impact of climate change.
After a series of Mauii wildfires in 2019, Hawaii Electric, state records show, spent only$245,000 on wildfire-specific upgrades and mitigation efforts on the island through 2022. That amount pales in comparison to the tens of millions of dollars paid out in dividends and executive compensation over the last four years.
Put another way, ethics records show Hawaii Electric spent $437,252 on lobbying state officials, including utility regulators, since 2019, far more than it spent addressing the Maui wildfire threat.
While the cause of the deadly fire last week is still under investigation, mounting evidence suggests that HEC’s equipment was at fault. On the morning of the fires on August 8th, Shane Treu, a Maui resident, was awakened by howling winds, stepped outside and took a livestream video of downed power lines igniting dry grass on a road in Lahaina.
Other critics have noted that the burn progression, witness accounts, and other videos point to downed power lines as the most likely cause of the fire. Whisker Labs Inc., which monitors electrical grid activity, reported that power outages from Hawaii Electric coincide with the first reports of the Maui fire.
Hawaii Electric also failed to turn off sections of its power grid during the wind storms last week, a precautionary measure adopted by other utilities in states with high fire risks, such as California.
Hawaii Electric and the Hawaii PUC did not respond to a request for comment.
In June 2022, in a regulatory filing, Hawaii Electric noted that the “risk of a utility system causing a wildfire ignition is significant,” and pointed out PG&E’s role in causing California wildfires. In the same filing, which included a plan to address the risk, the company identified West Maui as a critical priority area and sought permission to raise utility rates before beginning work on the necessary upgrades.
Hawaii Electric estimated that changes to its equipment, clearing fire hazards, and other upgrades in West Maui, including near Lahaina, would cost about $6.2 million.
But regulators did not force the company into action and there has been no follow-up. The proposal languished in a bureaucratic docket maintained by the Hawai Public Utilities Commission. The commission only responded, asking for an update on the plan, in June of this year, to which Hawaii Electric has not formally responded.
When making the presentation, the company maintained a familiar audience with the regulators. Commissioner Leodoloff Asuncion, the chair of PUC, previously worked directlyfor Hawaii Electric, Commissioner Naomi Kuwaye previously worked as an outside attorney for Hawaii Electric, and Commissioner Colin Yost runs a renewable energy firm, RevoluSun, which partners with Hawaii Electric.
Ethics disclosures show that in May, a utility industry lobbyist provided an all-expense paid trip for the public utility commissioners to fly to New York and meet with industry representatives.
That’s not to say the Maui wildfire risk and mitigation report went entirely forgotten. Instead of swiftly acting on the proposal, Hawaii Electric slightly changed course and applied for a federal grant from the newly enacted Bipartisan Infrastructure Bill signed by President Joe Biden in 2021 to pay for the upgrades.
The 2022 wildfire prevention plan is touted by Hawaii Electric in multiple ESG reports the company has since produced that showcase the corporation’s commitment to advancing environmental goals and addressing climate change. “Hawaiian Electric continues its work to assess resilience threats and prioritize improvements to enhance resilience,” the latest report states, before listing the wildfire prevention plan as an accomplishment.
ESG, or the Environmental, Social and Governance rating system, is the metric through which publicly traded companies compete to accomplish corporate responsibility goals. The rubric has come under scrutiny for its lack of enforcement mechanisms, self-reported data, and constantly shifting criteria.
A high ESG score can earn a firm better placement in socially responsible index funds or mutual funds, as well as access to so-called “green bonds.” Such measures can provide a company with greater investment capital and financing. Connie Lau, the previous president of the holding company that owns Hawaii Electric, touted the company’s ESG program in a speech to J.P. Morgan Chase in 2020.
The company, Lau said, “is known as a good ESG investment” because of its focus on renewable energy and its diverse board of directors. ESG, she added, is “in our DNA.”
Hawaii Electric, through its corporate foundation, this year also sponsored an hour-long documentary on local television touting its climate change resiliency efforts. The documentary featured local politicians, including Sen. Brian Schatz and former President Barack Obama.
Despite the efforts to tout its focus on the environment and resiliency in the face of climate change, Hawaii Electric appears to have ignored largely years of direct warnings about the threat of wildfires.
In 2018, high winds helped fuel wildfires that burned over 2,000 acres in Maui, a fire widely discussed by local officials and Hawaii Electric.
The following year, wildfires burned 9,000 acres in a fast-moving blaze that came within 150 feet of Hawaii Electric’s power plant on Maui, according to the Wall Street Journal. The crisis that year prompted a series of public events about the threat.
In 2021, Maui County produced a reportidentifying “wild/brush/forest fires” as a “growing threat,” especially because “vulnerable because populations tend to be clustered and dependent on single highways, often located on the island edge.”
The report noted that “above-ground power lines that fail, short, are low hanging can cause fire ignition (sparks) that could start a wildfire, particularly in windy or stormy conditions.”
Investigators from the Hawaii Attorney General’s office are still probing the fire. Beyond the issues surrounding the utility company’s slow-moving efforts to implement wildfire safety upgrades, questions are swirling about the failure to use Hawaii’s emergency siren system, the role of invasive grass species that are more prone to wildfire, dry conditions shaped by climate change, and water management policies that could have been in place to provide firefighters with water during the crisis.
The Maui fire is one of the worst fire disasters in American history, with 111 victims identified as of August 17th and over one thousand reportedly still missing.”
Image: Burned cars and destroyed buildings are pictured in the aftermath of a wildfire in Lahaina, western Maui, Hawaii on August 11, 2023. Photo by PAULA RAMON/AFP via Getty Images.
Credit & Publication: Lee Fang’s Substack. Published: August 17th 2023. Source Link: https://www.leefang.com/p/hawaii-electric-while-failing-to?r=5ords&utm_medium=ios&utm_campaign=post
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