Maui Business

Consumer Advocate Recommends Rejection of NextEra Merger

August 11, 2015, 7:27 AM HST
* Updated August 11, 7:28 AM
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DCCABy Maui Now Staff

The Division of Consumer Advocacy of the state Department of Commerce and Consumer Affairs filed its testimony yesterday, recommending that the Public Utilities Commission rejects the $4.3 billion NextEra Energy Inc.-HECO Companies merger as proposed, calling the purported benefits illusory and inadequate.

Consumer Advocate Jeffrey Ono believes that the current proposal is not in the public interest, because NextEra has not met its burden of proving that the merger will result in significant quantifiable benefits to consumers.

Among many questionable claims, NextEra offers flawed and broad speculative savings estimates, repeatedly touting benefits of millions of dollars in savings for customers, said a DCCA press release. The company’s filings do not clearly or consistently explain how these savings will materialize to the full extent they have been claimed, the release continued. This includes, for example, millions of dollars in purported savings resulting from broad reductions in operations and maintenance expenses that have not been clearly laid out. NextEra had ample opportunity to clarify these and other benefits during the discovery period, the release said.

“These kinds of asserted savings based on NextEra’s faulty calculations effectively overstate the potential benefits of the proposed merger, thereby creating an illusory benefit,” said Ono. “Since our mission is to protect and advance the interests of Hawai‘i’s consumers, we have serious concerns about this proposed merger.”


If the PUC plans to approve the merger, the Consumer Advocate recommends several conditions that need to be adopted to protect customer and return merger savings to them.


A copy of the Consumer Advocate’s testimony, as well as a list of upcoming public “listening sessions” and evidentiary hearings, is available online.

The Consumer Advocate’s office is a state agency established to protect and represent the interests of consumers before the PUC and other federal agencies with regulatory jurisdiction over public utility services, including electricity, telecommunications, pipeline gas, private water and wastewater and interisland water transportation.

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