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Electric utility segment
 12 Months Ended
Dec. 31, 2021
Electric Utility Subsidiary [Abstract]  
Electric utility segment
Note 3 · Electric utility segment
Regulatory assets and liabilities.  Regulatory assets represent deferred costs and accrued decoupling revenues which are expected to be recovered through rates over PUC-authorized periods. Generally, the Utilities do not earn a return on their regulatory assets; however, they have been allowed to recover interest on certain regulatory assets and to include certain regulatory assets in rate base. Regulatory liabilities represent amounts included in rates and collected from ratepayers for costs expected to be incurred in the future, or amounts collected in excess of costs incurred that are refundable to customers. For example, the regulatory liability for cost of removal in excess of salvage value represents amounts that have been collected from ratepayers for costs that are expected to be incurred in the future to retire utility plant. Generally, the Utilities include regulatory liabilities in rate base or are required to apply interest to certain regulatory liabilities. In the table below, noted in parentheses are the original PUC authorized amortization or recovery periods and, if different, the remaining amortization or recovery periods as of December 31, 2021 are noted.
Regulatory assets were as follows:
December 3120212020
(in thousands)  
Retirement benefit plans (balance primarily varies with plans’ funded statuses)$351,070 $592,644 
Income taxes (1-55 years)
88,087 96,171 
Decoupling revenue balancing account and RAM (1-2 years)
31,607 10,432 
Unamortized expense and premiums on retired debt and equity issuances (1-18 years; 1-18 years remaining)
7,300 8,654 
Vacation earned, but not yet taken (1 year)
14,255 15,665 
COVID-19 related costs (to be determined by PUC)27,839 18,032 
Other (1-38 years remaining)
45,385 25,110 
Total regulatory assets$565,543 $766,708 
Included in:  
Current assets$66,664 $30,435 
Long-term assets498,879 736,273 
Total regulatory assets$565,543 $766,708 

Regulatory liabilities were as follows:
December 3120212020
(in thousands)  
Cost of removal in excess of salvage value (1-79 years)
$562,514 $541,730 
Income taxes (1-55 years)
337,304 360,426 
Decoupling revenue balancing account and RAM (1-2 years)
251 1,957 
Retirement benefit plans (balance primarily varies with plans’ funded statuses)
51,734 29,759 
Solar tax credits (1-20 years)
27,123 8,096 
Other (1-4 years remaining)
17,842 17,818 
Total regulatory liabilities$996,768 $959,786 
Included in:
Current liabilities$29,760 $37,301 
Long-term liabilities967,008 922,485 
Total regulatory liabilities$996,768 $959,786 
The regulatory asset and liability relating to retirement benefit plans was recorded as a result of pension and OPEB tracking mechanisms adopted by the PUC in rate case decisions for the Utilities in 2007 (see Note 10).
Major customers.  The Utilities received 11% ($267 million), 11% ($249 million) and 11% ($281 million) of their operating revenues from the sale of electricity to various federal government agencies in 2021, 2020 and 2019, respectively.
Cumulative preferred stock. The following series of cumulative preferred stock are redeemable only at the option of the respective company at the following prices in the event of voluntary liquidation or redemption:
December 31, 2021Voluntary
liquidation price		Redemption
price
Series  
C, D, E, H, J and K (Hawaiian Electric)$20 $21 
I (Hawaiian Electric)20 20 
G (Hawaii Electric Light)100 100 
H (Maui Electric)100 100 
Hawaiian Electric is obligated to make dividend, redemption and liquidation payments on the preferred stock of each of its subsidiaries if the respective subsidiary is unable to make such payments, but this obligation is subordinated to Hawaiian Electric’s obligation to make payments on its own preferred stock.
Related-party transactions. HEI charged the Utilities $5.2 million, $5.6 million and $6.0 million for general management and administrative services in 2021, 2020 and 2019, respectively. The amounts charged by HEI to its subsidiaries for services provided by HEI employees are allocated primarily on the basis of time expended in providing such services.
In 2021, 2020 and 2019, Hamakua Energy (an indirect subsidiary of HEI) sold energy and capacity to Hawaii Electric Light (subsidiary of Hawaiian Electric and indirect subsidiary of HEI) under a PPA in the amount of $54 million, $50 million and $68 million, respectively.
Hawaiian Electric’s short-term borrowings from HEI totaled nil at December 31, 2021 and 2020. Borrowings among the Utilities are eliminated in consolidation. Interest charged by HEI to Hawaiian Electric was not material for the years ended December 31, 2021 and 2020.
Unconsolidated variable interest entities.
Power purchase agreements.  As of December 31, 2021, the Utilities had five PPAs for firm capacity (including the Puna Geothermal Venture (PGV) PPA that went offline in May 2018 due to lava flow on Hawaii Island, but returned to service with firm capacity of 13.0 MW in the first quarter of 2021 and ramped up to 23.9 MW in the second quarter of 2021) 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), AES Hawaii, Inc. (AES Hawaii) and Hamakua Energy by reason of the provisions of the PPA that the Utilities have with the three IPPs. However, management has concluded that the Utilities are not the primary beneficiary of Kalaeloa, AES Hawaii and Hamakua Energy because the Utilities do not have the power to direct the activities that most significantly impact the three 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, AES Hawaii and Hamakua Energy in its consolidated financial statements. Hamakua Energy is an indirect subsidiary of Pacific Current, and is consolidated in HEI’s 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 consolidated financial statements, including the recognition of a significant amount of assets and liabilities and, if such a consolidated IPP were operating at a loss and had insufficient equity, the potential recognition of such losses. If the Utilities determine they are required to consolidate the financial statements of such an IPP and the consolidation has a material effect, the Utilities would retrospectively apply accounting standards for VIEs to the IPP.
Commitments and contingencies.
Contingencies. The Utilities are subject in the normal course of business to pending and threatened legal proceedings. Management does not anticipate that the aggregate ultimate liability arising out of these pending or threatened legal proceedings will be material to its financial position. However, the Utilities cannot rule out the possibility that such outcomes could have a material effect on the results of operations or liquidity for a particular reporting period in the future.
Power purchase agreements.  Purchases from all IPPs were as follows: 
Years ended December 31202120202019
(in millions)
Kalaeloa$204 $149 $214 
AES Hawaii130 133 139 
HPOWER70 70 76 
Hamakua Energy
29 50 68 
Puna Geothermal Venture53 1 — 
Wind IPPs124 105 95 
Solar IPPs50 57 36 
Other IPPs1
10 4 5 
Total IPPs$670 $569 $633 
1 Includes hydro power and other PPAs
As of December 31, 2021, the Utilities had five firm capacity PPAs for a total of 540.4 megawatts (MW) of firm capacity. The PGV facility with 34.6 MW of firm capacity went offline in May 2018 due to lava flow on Hawaii Island, but returned to service with firm capacity of 13.0 MW in the first quarter of 2021, and ramped up to 23.9 MW in the second quarter and continued to provide 23.9 MW for the remainder of 2021. The PUC allows rate recovery for energy and firm capacity payments to IPPs under these agreements. Assuming that each of the agreements remains in place for its current term (and as amended) and the minimum availability criteria in the PPAs are met, aggregate minimum fixed capacity charges are expected to be approximately $76 million in 2022, $34 million each in 2023, 2024, 2025 and 2026, and $161 million from 2027 through 2033.
In general, the Utilities base their payments under the PPAs upon available capacity and actual energy supplied and they are generally not required to make payments for capacity if the contracted capacity is not available, and payments are reduced, under certain conditions, if available capacity drops below contracted levels. In general, the payment rates for capacity have been predetermined for the terms of the agreements. Energy payments will vary over the terms of the agreements. The Utilities pass on changes in the fuel component of the energy charges to customers through the energy cost recovery clause (ECRC) in their rate schedules. The Utilities do not operate, or participate in the operation of, any of the facilities that provide power under the agreements. Title to the facilities does not pass to Hawaiian Electric or its subsidiaries upon expiration of the agreements, and the agreements do not contain bargain purchase options for the facilities.
Purchase power adjustment clause. The PUC has approved purchased power adjustment clauses (PPACs) for the Utilities. Purchased power capacity, operation and maintenance (O&M) and other non-energy costs previously recovered through base rates are now recovered in the PPACs and, subject to approval by the PUC, such costs resulting from new purchased power agreements can be added to the PPACs outside of a rate case. Purchased energy costs continue to be recovered through the ECRC.
Kalaeloa Partners, L.P.  Under a 1988 PPA, as amended, Hawaiian Electric is committed to purchase 208 MW of firm capacity from Kalaeloa. Hawaiian Electric and Kalaeloa had been negotiating an extension to the PPA, and the PPA had automatically extended on a month-to-month basis as long as the parties were still negotiating in good faith. In October 2021, Hawaiian Electric and Kalaeloa signed the Amended and Restated Power Purchase Agreement for Firm Dispatchable Capacity and Energy (Amended and Restated PPA) to extend the PPA for an additional term of 10 years. In November 2021, Hawaiian Electric submitted an application for approval of the Amended and Restated PPA to the PUC.
AES Hawaii, Inc. Under a PPA entered into in March 1988, as amended (through Amended and Restated Amendment No. 4) for a period of 30 years ending September 2022, Hawaiian Electric agreed to purchase 180 MW of firm capacity from AES Hawaii. Hawaiian Electric and AES Hawaii have been in dispute over an additional 9 MW of capacity. In February 2018, Hawaiian Electric reached agreement with AES Hawaii on an amendment to the PPA (Amendment No. 4). However, in June 2018, the PUC issued an order suspending review of the amendment pending a Department of Health of the State of Hawaii (DOH) decision on AES Hawaii’s request for approval of its Emission Reduction Plan and partnership with Hawaiian Electric. Subsequently on November 25, 2021, Hawaiian Electric and AES Hawaii reached agreement in Amended and Restated Amendment No. 4 to power purchase agreement (A&RA No. 4) and Hawaiian Electric filed a Withdrawal of Application regarding Amendment No. 4. A&RA No. 4 resolves AES Hawaii’s claims related to the additional capacity and was filed as an informational filing with the PUC. Hawaiian Electric does not intend to extend the term of the PPA which will expire on September 1, 2022.
Hu Honua Bioenergy, LLC (Hu Honua). In May 2012, Hawaii Electric Light signed a PPA, which the PUC approved in December 2013, with Hu Honua for 21.5 MW of renewable, dispatchable firm capacity fueled by locally grown biomass from a facility on the island of Hawaii. Under the terms of the PPA, the Hu Honua plant was scheduled to be in service in 2016. However, Hu Honua encountered construction and litigation delays, which resulted in an amended and restated PPA between
Hawaii Electric Light and Hu Honua dated May 9, 2017. In July 2017, the PUC approved the amended and restated PPA, which becomes effective once the PUC’s order is final and non-appealable. In August 2017, the PUC’s approval was appealed by a third party. On May 10, 2019, the Hawaii Supreme Court issued a decision remanding the matter to the PUC for further proceedings consistent with the court’s decision, which must include express consideration of greenhouse gas (GHG) emissions that would result from approving the PPA, whether the cost of energy under the PPA is reasonable in light of the potential for GHG emissions, and whether the terms of the PPA are prudent and in the public interest, in light of its potential hidden and long-term consequences. As a result, the PUC reopened the docket for further proceedings, including re-examining all of the issues in the proceedings. On July 9, 2020, the PUC issued an order denying Hawaii Electric Light’s request to waive the amended and restated PPA from the PUC’s competitive bidding requirements and therefore, dismissed the request for approval of the amended and restated PPA without prejudice to possible participation in any future competitive bidding process. On September 9, 2020, the PUC denied Hu Honua’s motion for reconsideration of the PUC’s order. Hu Honua filed its notice of appeal to the Hawaii Supreme Court of the PUC’s order denying Hu Honua’s motion for reconsideration. On May 24, 2021, the Hawaii Supreme Court vacated the PUC’s decision and remanded the matter back to the PUC for further proceedings. On June 30, 2021, the PUC issued an order reopening the docket consistent with the Hawaii Supreme Court’s order. A contested case hearing was scheduled for January and February 2022, and has been rescheduled for March 2022.
Molokai New Energy Partners (MNEP). In July 2018, the PUC approved Maui Electric’s PPA with MNEP to purchase solar energy from a photovoltaic (PV) plus battery storage project. The 4.88 MW PV and 3 MW Battery Energy Storage System project was to deliver no more than 2.64 MW at any time to the Molokai system. On March 25, 2020, MNEP filed a complaint in the United Stated District Court for the District of Hawaii against Maui Electric claiming breach of contract. On June 3, 2020, Maui Electric provided Notice of Default and Termination of the PPA to MNEP terminating the PPA with an effective date of July 10, 2020. Thereafter, MNEP filed an amended Complaint to include claims relating to the termination and Hawaiian Electric filed its Answer to the Amended Complaint on September 11, 2020, disputing the facts presented by MNEP and all claims within the original and amended complaint. Currently, the discovery phase is ongoing.
Fuels barging contract. On August 23, 2021, the Utilities entered into a five-year inter-island fuel transportation contract with Sause Bros., Inc., with an estimated annual base rent of $6.2 million, commencing in January 2022 (see Note 8 for lease discussion). On December 23, 2021, the PUC issued an interim D&O approving the inter-island fuels transportation contract and recovery of associated costs on an interim basis. The interim decision is effective until the PUC issues its final D&O in the proceeding.
Utility projects.  Many public utility projects require PUC approval and various permits from other governmental agencies. Difficulties in obtaining, or the inability to obtain, the necessary approvals or permits or community support can result in significantly increased project costs or even cancellation of projects. In the event a project does not proceed, or if it becomes probable the PUC will disallow cost recovery for all or part of a project, or if PUC-imposed caps on project costs are expected to be exceeded, project costs may need to be written off in amounts that could result in significant reductions in Hawaiian Electric’s consolidated net income.
Enterprise Resource Planning/Enterprise Asset Management (ERP/EAM) implementation project. The ERP/EAM Implementation Project went live in October 2018. Hawaii Electric Light and Hawaiian Electric began to incorporate their portion of the deferred project costs in rate base and started the amortization over a 12-year period in January 2020 and November 2020, respectively. The PUC required a minimum of $246 million ERP/EAM project-related benefit to be delivered to customers over the system’s 12-year service life.
In February 2019, the PUC approved a methodology for passing the future cost saving benefits of the new ERP/EAM system to customers developed by the Utilities in collaboration with the Consumer Advocate. The Utilities filed a benefits clarification document on June 10, 2019, reflecting $150 million in future net O&M expense reductions and cost avoidance, and $96 million in capital cost reductions and tax savings over the 12-year service life. To the extent the reduction in O&M expense relates to amounts reflected in electric rates, the Utilities would reduce future rates for such amounts. In October 2019, the PUC approved the Utilities and the Consumer Advocate’s Stipulated Performance Metrics and Tracking Mechanism. As of December 31, 2021, the Utilities’ regulatory liability was $8.6 million ($5.4 million for Hawaiian Electric, $1.3 million for Hawaii Electric Light and $1.9 million for Maui Electric) for the O&M expense savings that are being amortized or to be included in future rates. As part of the settlement agreement approved in the Hawaiian Electric 2020 test year rate case, the regulatory liability for Hawaiian Electric will be amortized over five years, beginning in November 2020, and the O&M benefits for Hawaiian Electric was considered flowed through to customers. As part of the PBR proceeding, the regulatory liability as of December 31, 2020 of approximately $1.6 million and $2.3 million, respectively, for Hawaii Electric Light and Maui Electric was flowed to customers as part of the customer dividend in the annual revenue adjustment in 2021.
On July 7, 2021, the PUC issued an order modifying the reporting frequency of the Semi-Annual Enterprise System Benefits (SAESB) reports to an Annual Enterprise System Benefits (AESB) report on the achieved benefits savings. The most recent AESB report was filed on February 14, 2022 for the period January 1 through December 31, 2021.
West Loch PV Project. In November 2019, Hawaiian Electric placed into service a 20-MW (ac) utility-owned and operated renewable and dispatchable solar facility on property owned by the Department of the Navy. PUC orders resulted in a project cost cap of $67 million (including a cap of $4.7 million for the in-kind work to be performed in exchange for use of the Navy property) with capital cost recovery approved under MPIR (See “Performance-based regulation framework” section below for MPIR guidelines and cost recovery discussion.) Project costs incurred as of December 31, 2021 amounted to $58.8 million and generated $14.7 million and $14.0 million in federal and state nonrefundable tax credits, respectively. For book and regulatory purposes, the tax credits are being deferred and amortized, starting in 2020, over 25 years and 10 years for federal and state credits, respectively.
As part of the approval of the project, a performance guarantee mechanism was established, which calls for the Utilities to provide energy at target annual energy production levels. Customers are compensated for production shortfalls by the amount of shortfall multiplied by the Equivalent Levelized Energy Price (ELEP) based on the revenue requirements of the actual total cost of the project, but not to exceed 9.56 cents/kilowatt-hours (kWh). Compensation for shortfalls is provided to customers as a credit through the PPAC, while production surpluses are refunded to the Utilities up to the amount of previously issued underproduction credits. In December 2021, the Utilities accrued $0.7 million in estimated underproduction credits to be returned to customers in 2022 due to not meeting the 2021 annual production target. The 2021 underproduction credit is based on an interim ELEP representing total project costs as of August 31, 2021. The credit will be trued up based on a final ELEP based on final project costs.
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. The federal Environmental Protection Agency (EPA) has since identified environmental impacts in the subsurface soil at the Site. In cooperation with the DOH 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 $2.7 million as of December 31, 2021, 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.
On November 24, 2021, the current landowners of the Site, Misaki’s, Inc., filed a lawsuit against Hawaiian Electric (as alleged successor in interest to Molokai Electric, the prior owner of the Site) in the Circuit Court of the Second Circuit of the State of Hawaii (subsequently removed to the U.S. District Court for the District of Hawaii), alleging that Hawaiian Electric is responsible for remediation of the Site based on the Comprehensive Environmental Response, Compensation, and Liability Act of 1980, section 9601 and the Hawaii Environmental Response Law under Hawaii Revised Statutes Chapter 128D. The lawsuit seeks reimbursement and indemnification of costs to respond to the alleged release of hazardous substances on the Site, a declaratory judgment as to liability for response costs and other unspecified damages. Additionally, there are contractual claims for damages and past rent based on the period when the property was briefly leased back from Misaki’s to Molokai Electric during the transition of ownership. At this time, the Utilities are unable to determine the ultimate outcome of the lawsuit or the amount of any possible loss. The Utilities intend to vigorously defend the action.
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 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 December 31, 2021, the reserve account balance recorded by Hawaiian Electric to address the PCB contamination was $10.3 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.
Asset retirement obligations.  Asset retirement obligations (AROs) represent legal obligations associated with the retirement of certain tangible long-lived assets, are measured as the present value of the projected costs for the future retirement
of specific assets and are recognized in the period in which the liability is incurred if a reasonable estimate of fair value can be made. The Utilities’ recognition of AROs have no impact on their earnings. The cost of the AROs is recovered over the life of the asset through depreciation. AROs recognized by the Utilities relate to legal obligations associated with the retirement of plant and equipment, including removal of asbestos and other hazardous materials.
The Utilities recorded AROs related to: 1) the removal of retired generating units, certain types of transformers and underground storage tanks; 2) the abandonment of fuel pipelines, underground injection and supply wells; and 3) the removal of equipment and restoration of leased land used in connection with Utility-owned renewable and dispatchable generation facilities. 
Changes to the ARO liability included in “Other liabilities” on Hawaiian Electric’s balance sheet were as follows:
(in thousands)20212020
Balance, January 1$10,692 $10,324 
Accretion expense423 405 
Liabilities incurred— — 
Liabilities settled(5)(37)
Balance, December 31$11,110 $10,692 
The Utilities have not recorded AROs for assets that are expected to operate indefinitely or where the Utilities cannot estimate a settlement date (or range of potential settlement dates). As such, ARO liabilities are not recorded for certain asset retirement activities, including various Utilities-owned generating facilities and certain electric transmission, distribution and telecommunications assets resulting from easements over property not owned by the Utilities.
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. Prior to the implementation of the performance-based regulation framework (PBR Framework), the decoupling mechanism had the following major components: (1) monthly revenue balancing account (RBA) revenues or refunds for the difference between PUC-approved target revenues and recorded adjusted revenues, which delinks revenues from kWh sales, (2) revenue adjustment mechanism (RAM) revenues for escalation in certain O&M expenses and rate base changes, (3) major project interim recovery (MPIR) adjustment mechanism, (4) performance incentive mechanisms (PIMs), and (5) an earnings sharing mechanism (ESM), which would provide for a reduction of revenues between rate cases in the event the utility exceeds the authorized rate-making return on average common equity (ROACE) allowed in its most recent rate case.
Performance-based regulation framework. On December 23, 2020, the PUC issued a D&O (PBR D&O) approving the new PBR Framework. Under the PBR Framework, the Utilities’ decoupling will continue to be used with modifications, as described below. The existing cost recovery mechanisms will continue as currently implemented (e.g., the Energy Cost Recovery Clause (ECRC), Purchased Power Adjustment Clause (PPAC), Demand Side Management surcharge (DSM), Renewable Energy Infrastructure Program (REIP), Demand Response Adjustment Clause (DRAC), Pension and Other Post-Employment Benefits (OPEB) tracking mechanisms). In addition to annual revenues provided by the annual revenue adjustment (ARA), the Utilities may seek relief for extraordinary projects or programs through the Exceptional Project Recovery Mechanism (EPRM) (formerly known as the MPIR adjustment mechanism) and earn financial rewards for exemplary performance as provided through a portfolio of PIMs and Shared Savings Mechanisms (SSMs). The PBR Framework will incorporate a variety of other performance mechanisms, including Scorecards, Reported Metrics, and an expedited Pilot Process. The PBR Framework also contains a number of safeguards, including a symmetric ESM which protects the Utilities and customers from excessive earnings or losses, as measured by the Utilities’ achieved rate-making ROACE and a Re-Opener mechanism, under which the PUC will open an examination, at its discretion, to determine if adjustments or modifications to specific PBR mechanisms are appropriate. The new PBR Framework became fully effective on June 1, 2021.
On September 17, 2021, the PUC issued an order, including a proposed new set of potential PIMs to address these areas of PUC concern:
•Grid reliability,
•Timely retirement of fossil fuel generation units,
•Interconnection of large-scale renewable energy projects,
•Cost control for fossil fuel, purchased power, and other non-ARA costs, and
•Expedient utilization of grid services from demand-side resources
The order established a procedural schedule by which a PBR Working Group (consisting of parties from the docket in which the new PBR Framework was established) will comment upon and evaluate the potential new PIMs and potentially
propose alternatives. The schedule included procedural steps for technical conferences, statements of position filings and an evidentiary hearing. The PUC has not stated when any new PIMs might become effective. On November 19, 2021, the PUC modified the procedural schedule. Accordingly, the Utilities filed their preliminary statements of position on February 8, 2022. The final statements of position are due on March 18, 2022, and an evidentiary hearing during the week of April 4, 2022.
Revenue adjustment mechanism. The RAM is based on the lesser of: a) an inflationary adjustment for certain O&M expenses and return on investment for certain rate base changes, or b) cumulative annual compounded increase in Gross Domestic Product Price Index applied to annualized target revenues (the RAM Cap). All Utilities were limited to the RAM Cap in 2020. Under the PBR Framework, the ARA mechanism replaced the RAM, and became effective on June 1, 2021. The transition to the ARA includes the continuation of the 2020 RAM revenue adjustment.
Annual revenue adjustment mechanism. The PBR Framework established a five-year multi-year rate period 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.
As a result of an Order issued by the PUC pursuant to a motion for partial reconsideration the customer dividend for “pre-PBR” savings commitment portion to be delivered to customers will be at a rate of $6.6 million per year from 2021 to 2025, and the Enterprise Resource Planning system benefits savings of $3.9 million, to be delivered to customers in 2021. The implementation of the ARA occurred on June 1, 2021.
Earnings sharing mechanism. A symmetrical ESM for achieved rate-making ROACE outside of a 300 basis points dead band above or below the current authorized ROACE of 9.5% for each of each of the Utilities. There is a 50/50 sharing between customers and Utilities for the achieved rate-making ROACE falling within 150 basis points outside of the dead band in either direction, and a 90/10 sharing for any further difference. A reopening or review of the PBR terms will be triggered if the Utilities credit rating outlook indicates a potential credit downgrade below investment grade status, or if its achieved rate-making ROACE enters the outer most tier of the ESM.
Major project interim recovery. On April 27, 2017, the PUC issued an order that provided guidelines for interim recovery of revenues to support major projects placed in service between general rate cases.
Projects eligible for recovery through the MPIR adjustment mechanism are major projects (i.e., projects with capital expenditures net of customer contributions in excess of $2.5 million), including, but not restricted to, renewable energy, energy efficiency, utility scale generation, grid modernization and smaller qualifying projects grouped into programs for review. The MPIR adjustment mechanism provides the opportunity to recover revenues for approved costs of eligible projects placed in service between general rate cases wherein cost recovery is limited by a revenue cap and is not provided by other effective recovery mechanisms. The request for PUC approval must include a business case, and all costs that are allowed to be recovered through the MPIR adjustment mechanism must be offset by any related benefits. The guidelines provide for accrual of revenues approved for recovery upon in-service date to be collected from customers through the annual RBA tariff. Capital projects that are not recovered through the MPIR would be included in the RAM and be subject to the RAM Cap, until the next rate case when the Utilities would request recovery in base rates.
On May 26, 2021, the PUC approved 2021 MPIR amounts totaling $21.8 million, including revenue taxes, for the Schofield Generating Station ($17.6 million), West Loch PV Project ($3.3 million), and Grid Modernization Strategy (GMS) Phase 1 project ($0.9 million for all three utilities) for the accrual of revenues effective January 1, 2021, that included the 2021 return on project amount (based on approved amounts) in rate base, depreciation and incremental O&M expenses. Under the PBR Framework, the Utilities began recovery of the annualized 2021 MPIR amounts effective June 1, 2021 through the RBA rate adjustment.
On September 27, 2021, the PUC issued an order rejecting the Utilities’ August 31, 2021 request to update target revenues resulting from the GMS Phase 1 Meter Data Management System (MDMS) deferred software go‑live and completion of implementation through July 2021, as it inappropriately relied on an automatic approval provision in Hawaii Administrative Rules. The PUC did not rule on the merits of the Utilities’ request and offered the Utilities to file an amended request as soon as practicable. On October 7, 2021, the Utilities filed an amended request, requesting PUC approval of RBA tariff sheets reflecting the change to target revenues associated with the GMS Phase 1 MDMS deferred software go-live and completion of implementation through July 2021, which was approved by the PUC on December 20, 2021.
Exceptional project recovery mechanism. Under the PBR Framework, the existing MPIR adjustment mechanism was renamed EPRM to include deferred and O&M expense projects and to 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. Any pending application for MPIR relief submitted by the Utilities prior to the PBR D&O will be grandfathered under the MPIR Guidelines. The Utilities may alternatively request that pending MPIR applications be reviewed under EPRM Guidelines. EPRM recovery will be in accordance with the EPRM Guidelines limited to the lesser of actual incurred project costs or PUC-approved amounts, net of savings. As of December 31, 2021, the PUC approved two EPRM projects totaling $41 million to the extent that the project costs are not included in rates. Currently, the Utilities are seeking EPRM recovery of five projects with total project costs of $264 million, subject to PUC approval.
Pilot process. The PBR D&O approved a Pilot Process to foster innovation by establishing an expedited implementation process for pilots that test new technologies, programs, business models, and other arrangements. This is intended to support initiatives by the Utilities to test new programs and ideas quickly and elevate any successful pilots for consideration of full-scale implementation. The proposed pilots would be subject to PUC approval with a total annual cap of $10 million. The Pilot Process will feature the two primary activities: an initial “Workplan Development” phase, during which the Utilities identify and scope areas of interests, so as to inform the subsequent “Implementation” phase, during which the Utilities submit specific pilot proposals for expedited review by the PUC and implement the pilot upon approval. The PUC will issue an order, approving, denying, or modifying a proposed Pilot within 45 days of receiving notice of a specific pilot project.
On July 9, 2021, the PUC issued an order approving the Utilities’ proposed Pilot Process submitted in April 2021 with modifications, including a cost recovery process that generally allows the Utilities to defer and recover total annual expenditures of approved pilot projects in full over twelve months beginning June 1 of the year following implementation through the RBA rate adjustment, although the Utilities may determine on a case-by-case basis that a particular project’s deferred costs should be amortized over a period greater than twelve months. On July 28, 2021, the Utilities submitted the finalized Pilot Process to govern the review of the pilot project proposals in accordance with the July 9, 2021 order.
On November 30, 2021, the PUC solicited comments from the Parties regarding the Pilot Process Workplan filed by the Utilities on November 12, 2021. The Utilities filed their response to those comments on January 5, 2022.
Performance incentive mechanisms. The PUC has established the following PIMs: (1) Service Quality performance incentives, (2) Phase 1 Request for proposal (RFP) PIM for procurement of low-cost renewable energy, (3) Phase 2 RFP PIMs for generation and generation plus storage project, and Grid Services and standalone storage, (4) new PIMs established in the PBR D&O.
•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 System Average Interruption Duration and Frequency Indexes (penalties only). Target performance is based on each utility’s historical 10-year average performance with a deadband of one standard deviation. The maximum penalty for each performance index is 20 basis points applied to the common equity share of each respective utility’s approved rate base (or maximum penalties of approximately $6.8 million - for both indices in total for the three utilities). In 2021, the Utilities accrued $0.2 million in estimated penalties for service reliability.
•Call Center Performance measured by the percentage of calls answered within 30 seconds. Target performance is based on the annual average performance for each utility for the most recent 8 quarters with a deadband of 3% above and below the target. The maximum penalty or reward is 8 basis points applied to the common equity share of each respective utility’s approved rate base (or maximum penalties or rewards of approximately $1.4 million - in total for the three utilities).
•Phase 1 RFP PIM. Procurement of low-cost variable renewable resources through the RFP process in 2018 is measured by comparison of the procurement price to target prices. Half of the incentive was earned upon PUC approval of the PPAs. Based on the seven PPAs approved in 2019, the Utilities recognized $1.7 million in 2019 with the remaining award to be recognized in the year following the in-service date of the projects, which is estimated to occur from 2023 to 2024.
•Phase 2 RFP PIMs. The PUC order issued on October 9, 2019 establishes pricing thresholds, timelines to complete contracting, and other performance criteria for the performance incentive eligibility. The PIMs provide incentives only without penalties. On July 9, 2020, the Utilities filed two Grid Service Purchase Agreements for the Grid Service RFP that potentially qualify for a demand response PIM; however, details of the incentive metrics will be determined by the PUC. On September 15, 2020, the Utilities filed a PPA that qualified for a PIM incentive and on February 16, 2021, the Utilities filed one additional PPA that qualified for a declining PIM incentive. The PUC approved two PPAs in September 2021 and November 2021, and two Grid Services Purchase Agreements on December 31, 2020. In 2021, the Utilities accrued $0.1 million in incentive related to the two PPAs.
•The PUC established the following two new PIMs in its PBR D&O, which were approved in an order issued on March 23, 2021 and became effective on June 1, 2021.
•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 multi-year rate period (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 2021, the Utilities accrued $0.7 million in estimated rewards.
•Grid Services Procurement PIM that provides financial rewards for grid services acquired in 2021 and 2022. The Utilities can earn a total maximum reward of $1.5 million over 2021 and 2022. The evaluation period commenced on January 1, 2021.
•The PUC also established the following three new PIMs in its PBR D&O, which were approved by the PUC on May 17, 2021 and became effective on June 1, 2021.
•Interconnection Approval PIM that provides financial rewards and penalties for interconnection times for distributed energy resources systems <100 kW in size. The Utilities can earn a total annual maximum reward of $3.0 million or a total annual maximum penalty of $0.9 million. The evaluation period commenced on January 1, 2021. In 2021, the Utilities accrued $2.8 million in estimated rewards.
•Low-to-Moderate Income (LMI) Energy Efficiency PIM that provides financial reward 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.
•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.
In 2021, the Utilities accrued $3.4 million ($2.6 million for Hawaiian Electric, $0.3 million for Hawaii Electric Light and $0.5 million for Maui Electric) in estimated rewards net of penalties, for 2021. The net rewards related to 2021 will be reflected in the 2022 PIMs annual report and 2022 Spring Revenue Report filings.
Annual review cycle. PBR D&O established an annual review cycle for revenue adjustments under the PBR Framework, including the biannual submission of the revenue reports. The Utilities filed the fall revenue report on October 29, 2021, which was approved by the PUC on December 22, 2021. The filing reflected ARA revenues for 2022 to be collected from January 1 through December 31, 2022, as follows:
(in millions)Hawaiian ElectricHawaii Electric LightMaui ElectricTotal
2022 ARA revenues$19.8 $4.9 $4.8 $29.5 
Management Audit savings commitment(4.6)(1.0)(1.0)(6.6)
Net 2022 ARA revenues$15.2 $3.9 $3.8 $22.9 
The net incremental amounts between the 2021 spring and fall revenue reports are as follows. The amounts are to be collected (refunded) from January 1 through December 31, 2022 under the RBA rate tariffs, which were included in the 2021 fall revenue report filing.
(in millions)Hawaiian ElectricHawaii Electric LightMaui ElectricTotal
Incremental RAM revenues and ARA revenues$41.7 $8.9 $10.9 $61.5 
Incremental accrued RBA balance through September 30, 2021 (and associated revenue taxes)21.9 2.5 (0.1)24.3 
Incremental Performance Incentive Mechanisms (net)
— — 0.1 0.1 
Incremental MPIR/EPRM Revenue Adjustment9.8 0.3 0.3 10.4 
Net incremental amount to be collected under the RBA rate tariffs$73.4 $11.7 $11.1 $96.2 
Note: Columns may not foot due to rounding.
Most recent rate proceedings.
Hawaiian Electric 2020 test year rate case. On October 22, 2020, the PUC issued a final D&O approving the stipulated settlement agreement filed in the proceeding. As a result, there will be no increase in base electric rates established in the 2017 test year rate case. In the final D&O, the PUC approved the capital structure that consists of a 58% total equity ratio, and an authorized ROACE of 9.5% for the 2020 test year. The resulting return on rate base (RORB) is 7.37%. The D&O approved the agreement to implement the overall lower depreciation rates approved in the last depreciation study proceeding, effective January 1, 2020. See “Annual revenue adjustment mechanism” under “Performance-based regulation framework” above, regarding the PUC’s decision on the treatment of Hawaiian Electric’s Management Audit savings commitment. Hawaiian Electric’s proposed RBA provision tariff and ECRC tariff submitted on November 6, 2020 were approved by the PUC on December 11, 2020 and took effect on January 1, 2021.
Hawaii Electric Light 2019 test year rate case. On July 28, 2020, the PUC issued a final D&O, approving the Stipulated Partial Settlement Letter in part and ordering final rates for the 2019 test year to remain at current effective rates such that there is a zero increase in rates. The PUC determined that an appropriate authorized ROACE for the 2019 test year is 9.5%, approved a capital structure of 58% total equity and approved as fair a 7.52% RORB. In addition, the order, among others, (1) approved a 10-year amortization period for the state investment tax credit; and (2) approved a modification to Hawaii Electric Light’s ECRC to incorporate a 98%/2% risk-sharing split between customers and Hawaii Electric Light with an annual maximum exposure cap of +/- $600,000. The proposed final tariffs and PIM tariffs took effect on November 1, 2020, and the ECRC tariff took effect on January 1, 2021.
Regulatory assets for COVID-19 related costs. On May 4, 2020, the PUC issued an order, authorizing all utilities, including the Utilities, to establish regulatory assets to record costs resulting from the suspension of disconnections of service during the pendency of the Governor’s Emergency Proclamation and until otherwise ordered by the PUC. In future proceedings, the PUC will consider the reasonableness of the costs, the appropriate period of recovery, any amount of carrying costs thereon, and any savings directly attributable to suspension of disconnects, and other related matters. As part of the order, the PUC prohibits the Utilities from charging late payment fees on past due payments. As the moratorium on customer disconnections ended on May 31, 2021, the Utilities have resumed charging late payment fees in July 2021. On June 30, 2020, the PUC issued an order approving the Utilities’ request made in April 2020 for deferral treatment of COVID-19 related costs through December 31, 2020. On October 1, 2021, the PUC approved the Utilities’ request to extend the deferral period to December 31, 2021. In December 2021, to keep customers connected and provide some relief to customers experiencing financial difficulty during the pandemic, the Utilities have committed to issuing $2 million in bill credits to qualified customers. The Utilities will not seek recovery for the issued bill credits resulting in a reduction to the cumulative deferred costs. As of December 31, 2021, the Utilities recorded a total of $27.8 million in regulatory assets pursuant to the orders.
Collective bargaining agreement. As of December 31, 2021, approximately 47% of the Utilities’ employees are members of the International Brotherhood of Electrical Workers, AFL-CIO, Local 1260. The collective bargaining agreement between the union and the Utilities was set to expire on October 31, 2021 but had been extended through January 3, 2022 while negotiations for a new agreement continued. On December 3, 2021, the union’s members ratified a new collective bargaining agreement. The new collective bargaining agreement covers a term from November 1, 2021 to October 31, 2024 and provides for non-compound 3% general wage increase for each year of the 3-year contract and includes changes to retirement benefits for employees hired on or after January 1, 2022. (see Note 10)
Consolidating financial information. Consolidating financial information for Hawaiian Electric and its subsidiaries are presented for the years ended December 31, 2021, 2020 and 2019, and as of December 31, 2021 and 2020.
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 (see Hawaiian Electric and Subsidiaries’ Consolidated Statements of Capitalization). 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.
Consolidating statement of income
Year ended December 31, 2021
(in thousands)Hawaiian ElectricHawaii Electric LightMaui ElectricConsolidating adjustments
Hawaiian Electric
Consolidated
Revenues$1,793,372 381,033 365,256 (25)[1]$2,539,636 
Expenses
Fuel oil442,818 80,086 121,445 — 644,349 
Purchased power508,642 108,997 52,855 — 670,494 
Other operation and maintenance313,009 79,390 83,013 — 475,412 
Depreciation155,607 40,201 33,661 — 229,469 
Taxes, other than income taxes170,604 35,499 34,251 — 240,354 
   Total expenses1,590,680 344,173 325,225 — 2,260,078 
Operating income202,692 36,860 40,031 (25)279,558 
Allowance for equity funds used during construction7,734 586 1,214 — 9,534 
Equity in earnings of subsidiaries45,353 — — (45,353)[2]— 
Retirement defined benefits credit (expense)—other than service costs3,348 670 (128)— 3,890 
Interest expense and other charges, net(51,680)(10,353)(10,439)25 [1](72,447)
Allowance for borrowed funds used during construction2,617 197 436 — 3,250 
Income before income taxes210,064 27,960 31,114 (45,353)223,785 
Income taxes31,342 6,246 6,560 — 44,148 
Net income178,722 21,714 24,554 (45,353)179,637 
Preferred stock dividends of subsidiaries— 534 381 — 915 
Net income attributable to Hawaiian Electric178,722 21,180 24,173 (45,353)178,722 
Preferred stock dividends of Hawaiian Electric
1,080 — — — 1,080 
Net income for common stock$177,642 21,180 24,173 (45,353)$177,642 

Consolidating statement of comprehensive income
Year ended December 31, 2021
(in thousands)Hawaiian ElectricHawaii Electric LightMaui ElectricConsolidating
adjustments		Hawaiian Electric
Consolidated
Net income for common stock$177,642 21,180 24,173 (45,353)$177,642 
Other comprehensive income (loss), net of taxes:
Retirement benefit plans:    
Net gains arising during the period, net of taxes151,523 17,902 16,572 (34,474)[1]151,523 
Adjustment for amortization of prior service credit and net losses recognized during the period in net periodic benefit cost, net of tax benefits
19,461 2,749 2,553 (5,302)[1]19,461 
Reclassification adjustment for impact of D&Os of the PUC included in regulatory assets, net of taxes(171,345)(20,585)(18,898)39,483 [1](171,345)
Other comprehensive income (loss), net of taxes(361)66 227 (293)(361)
Comprehensive income attributable to common shareholder
$177,281 21,246 24,400 (45,646)$177,281 
Consolidating statement of income
Year ended December 31, 2020
(in thousands)Hawaiian ElectricHawaii Electric LightMaui ElectricConsolidating adjustments
Hawaiian Electric
Consolidated
Revenues$1,608,305 334,221 323,430 (636)[1]$2,265,320 
Expenses
Fuel oil354,087 72,202 88,985 — 515,274 
Purchased power446,672 73,120 48,957 — 568,749 
Other operation and maintenance311,781 73,746 88,665 — 474,192 
Depreciation151,387 39,041 32,305 — 222,733 
Taxes, other than income taxes154,191 31,181 30,450 — 215,822 
   Total expenses1,418,118 289,290 289,362 — 1,996,770 
Operating income190,187 44,931 34,068 (636)268,550 
Allowance for equity funds used during construction
7,335 543 890 — 8,768 
Equity in earnings of subsidiaries47,504 — — (47,504)[2]— 
Retirement defined benefits credit (expense)—other than service costs(1,294)672 (141)— (763)
Interest expense and other charges, net(48,775)(10,004)(9,651)636 [1](67,794)
Allowance for borrowed funds used during construction2,540 160 292 — 2,992 
Income before income taxes197,497 36,302 25,458 (47,504)211,753 
Income taxes27,077 8,275 5,066 — 40,418 
Net income170,420 28,027 20,392 (47,504)171,335 
Preferred stock dividends of subsidiaries— 534 381 — 915 
Net income attributable to Hawaiian Electric170,420 27,493 20,011 (47,504)170,420 
Preferred stock dividends of Hawaiian Electric1,080 — — — 1,080 
Net income for common stock$169,340 27,493 20,011 (47,504)$169,340 

Consolidating statement of comprehensive income
Year ended December 31, 2020
(in thousands)Hawaiian ElectricHawaii Electric LightMaui ElectricConsolidating adjustmentsHawaiian Electric
Consolidated
Net income for common stock$169,340 27,493 20,011 (47,504)$169,340 
Other comprehensive income (loss), net of taxes:
Retirement benefit plans:      
Net losses arising during the period, net of tax benefits(63,050)(9,424)(10,897)20,321 [1](63,050)
Adjustment for amortization of prior service credit and net losses recognized during the period in net periodic benefit cost, net of tax benefits
21,550 3,179 2,763 (5,942)[1]21,550 
Reclassification adjustment for impact of D&Os of the PUC included in regulatory assets, net of taxes
39,860 6,025 8,000 (14,025)[1]39,860 
Other comprehensive loss, net of tax benefits(1,640)(220)(134)354 (1,640)
Comprehensive income attributable to common shareholder
$167,700 27,273 19,877 (47,150)$167,700 
Consolidating statement of income
Year ended December 31, 2019
(in thousands)Hawaiian ElectricHawaii Electric LightMaui ElectricConsolidating adjustments
Hawaiian Electric
Consolidated
Revenues$1,803,698 364,590 378,202 (548)[1]$2,545,942 
Expenses
Fuel oil494,728 84,565 141,416 — 720,709 
Purchased power494,215 90,989 48,052 — 633,256 
Other operation and maintenance319,771 76,091 85,875 — 481,737 
Depreciation143,470 41,812 30,449 — 215,731 
Taxes, other than income taxes170,979 33,787 35,365 — 240,131 
   Total expenses1,623,163 327,244 341,157 — 2,291,564 
Operating income 180,535 37,346 37,045 (548)254,378 
Allowance for equity funds used
   during construction
9,955 816 1,216 — 11,987 
Equity in earnings of subsidiaries43,167 — — (43,167)[2]— 
Retirement defined benefits expense—other than service costs
(2,287)(422)(127)— (2,836)
Interest expense and other charges, net(51,199)(10,741)(9,450)548 [1](70,842)
Allowance for borrowed funds used during construction
3,666 342 445 — 4,453 
Income before income taxes183,837 27,341 29,129 (43,167)197,140 
Income taxes25,917 5,990 6,398 — 38,305 
Net income157,920 21,351 22,731 (43,167)158,835 
Preferred stock dividends of subsidiaries— 534 381 — 915 
Net income attributable to Hawaiian Electric
157,920 20,817 22,350 (43,167)157,920 
Preferred stock dividends of Hawaiian Electric1,080 — — — 1,080 
Net income for common stock$156,840 20,817 22,350 (43,167)$156,840 

Consolidating statement of comprehensive income
Year ended December 31, 2019
(in thousands)Hawaiian ElectricHawaii Electric LightMaui ElectricConsolidating adjustmentsHawaiian Electric
Consolidated
Net income for common stock$156,840 20,817 22,350 (43,167)$156,840 
Other comprehensive income (loss), net of taxes:
Retirement benefit plans:      
Net gains (losses) arising during the period, net of taxes5,249 373 (204)(169)[1]5,249 
Adjustment for amortization of prior service credit and net losses recognized during the period in net periodic benefit cost, net of tax benefits
9,550 1,455 1,182 (2,637)[1]9,550 
Reclassification adjustment for impact of D&Os of the PUC included in regulatory assets, net of taxes
(16,177)(1,840)(1,152)2,992 [1](16,177)
Other comprehensive loss, net of tax benefits(1,378)(12)(174)186 (1,378)
Comprehensive income attributable to common shareholder
$155,462 20,805 22,176 (42,981)$155,462 
Consolidating balance sheet
December 31, 2021
(in thousands)Hawaiian ElectricHawaii Electric LightMaui ElectricOther subsidiariesConsolidating
adjustments		Hawaiian Electric
Consolidated
Assets      
Property, plant and equipment
Utility property, plant and equipment      
Land$42,737 5,606 3,594 — — $51,937 
Plant and equipment5,097,033 1,390,361 1,248,589 — — 7,735,983 
Less accumulated depreciation(1,757,096)(619,991)(563,430)— — (2,940,517)
Construction in progress159,854 17,129 27,586 — — 204,569 
Utility property, plant and equipment, net3,542,528 793,105 716,339 — — 5,051,972 
Nonutility property, plant and equipment, less accumulated depreciation
5,302 115 1,532 — — 6,949 
Total property, plant and equipment, net3,547,830 793,220 717,871 — — 5,058,921 
Investment in wholly-owned subsidiaries, at equity
676,237 — — — (676,237)[2]— 
Current assets       
Cash and cash equivalents23,344 5,326 23,422 77 —  52,169 
Restricted cash3,089 — — — — 3,089 
Advances to affiliates1,000 — — — (1,000)[1]— 
Customer accounts receivable, net
135,949 28,469 22,441 — —  186,859 
Accrued unbilled revenues, net92,469 19,529 17,157 — —  129,155 
Other accounts receivable, net18,624 3,347 3,031 — (17,735)[1]7,267 
Fuel oil stock, at average cost71,184 12,814 20,080 — — 104,078 
Materials and supplies, at average cost
42,006 9,727 20,144 — — 71,877 
Prepayments and other32,140 6,052 7,114 — 725 [1]46,031 
Regulatory assets58,695 3,051 4,918 — — 66,664 
Total current assets478,500 88,315 118,307 77 (18,010)667,189 
Other long-term assets      
Operating lease right-of-use assets78,710 22,442 318 — — 101,470 
Regulatory assets337,903 81,645 79,331 — — 498,879 
Other130,546 17,124 18,510 — (1,014)[1]165,166 
Total other long-term assets547,159 121,211 98,159 — (1,014)765,515 
Total assets
$5,249,726 1,002,746 934,337 77 (695,261)$6,491,625 
Capitalization and liabilities      
Capitalization      
Common stock equity$2,261,899 332,900 343,260 77 (676,237)[2]$2,261,899 
Cumulative preferred stock–not subject to mandatory redemption
22,293 7,000 5,000 — —  34,293 
Long-term debt, net1,136,620 234,390 253,417 — —  1,624,427 
Total capitalization3,420,812 574,290 601,677 77 (676,237)3,920,619 
Current liabilities       
Current portion of operating lease liabilities45,955 3,378 35 — — 49,368 
Current portion of long-term debt, net39,981 11,994 — — —  51,975 
Short-term borrowings-affiliate— 1,000 — — (1,000)[1]— 
Accounts payable111,024 26,139 22,844 — —  160,007 
Interest and preferred dividends payable
12,442 2,617 2,269 — (3)[1]17,325 
Taxes accrued, including revenue taxes143,723 33,153 30,679 — 725 [1]208,280 
Regulatory liabilities22,240 3,247 4,273 — — 29,760 
Other56,752 14,158 18,540 — (17,881)[1]71,569 
Total current liabilities432,117 95,686 78,640 — (18,159)588,284 
Deferred credits and other liabilities      
Operating lease liabilities46,426 19,063 291 — — 65,780 
Deferred income taxes291,027 53,298 64,309 — — 408,634 
Regulatory liabilities695,152 179,267 92,589 — — 967,008 
Unamortized tax credits76,201 14,212 13,532 — —  103,945 
Defined benefit pension and other postretirement benefit plans liability
220,480 48,900 53,257 — (857)[1]321,780 
Other67,511 18,030 30,042 — (8)115,575 
Total deferred credits and other liabilities
1,396,797 332,770 254,020 — (865) 1,982,722 
Total capitalization and liabilities$5,249,726 1,002,746 934,337 77 (695,261)$6,491,625 
Consolidating balance sheet
December 31, 2020
(in thousands)Hawaiian ElectricHawaii Electric LightMaui ElectricOther subsidiariesConsolidating
adjustments		Hawaiian Electric
Consolidated
Assets       
Property, plant and equipment
Utility property, plant and equipment       
Land$42,411 5,606 3,594 — — $51,611 
Plant and equipment4,960,470 1,352,885 1,195,988 — — 7,509,343 
Less accumulated depreciation(1,677,256)(597,606)(544,217)— — (2,819,079)
Construction in progress143,616 13,043 31,683 — — 188,342 
Utility property, plant and equipment, net3,469,241 773,928 687,048 — — 4,930,217 
Nonutility property, plant and equipment, less accumulated depreciation
5,306 115 1,532 — — 6,953 
Total property, plant and equipment, net3,474,547 774,043 688,580 — — 4,937,170 
Investment in wholly-owned subsidiaries, at equity
626,890 — — — (626,890)[2]— 
Current assets       
Cash and cash equivalents42,205 3,046 2,032 77 —  47,360 
Restricted cash15,966 — — — — 15,966 
Advances to affiliates26,700 — — — (26,700)[1]— 
Customer accounts receivable, net
102,736 23,989 21,107 — —  147,832 
Accrued unbilled revenues, net73,628 13,631 13,777 — —  101,036 
Other accounts receivable, net17,984 3,028 2,856 — (16,195)[1]7,673 
Fuel oil stock, at average cost38,777 8,471 10,990 — — 58,238 
Materials and supplies, at average cost
38,786 9,896 18,662 — — 67,344 
Prepayments and other34,306 5,197 4,580 — — 44,083 
Regulatory assets22,095 1,954 6,386 — — 30,435 
Total current assets413,183 69,212 80,390 77 (42,895)519,967 
Other long-term assets      
Operating lease right-of-use assets125,858 1,443 353 — — 127,654 
Regulatory assets513,192 114,461 108,620 — — 736,273 
Other98,307 17,992 20,010 — — 136,309 
Total other long-term assets737,357 133,896 128,983 — — 1,000,236 
Total assets
$5,251,977 977,151 897,953 77 (669,785)$6,457,373 
Capitalization and liabilities      
Capitalization      
Common stock equity$2,141,918 317,451 309,363 77 (626,891)[2]$2,141,918 
Cumulative preferred stock–not subject to mandatory redemption
22,293 7,000 5,000 — —  34,293 
Long-term debt, net1,116,426 216,447 228,429 — —  1,561,302 
Total capitalization3,280,637 540,898 542,792 77 (626,891)3,737,513 
Current liabilities       
Current portion of operating lease liabilities64,599 98 33 — — 64,730 
Short-term borrowings-non-affiliate49,979 — — — — 49,979 
Short-term borrowings-affiliate— 18,800 7,900 — (26,700)[1]— 
Accounts payable97,102 19,570 17,177 — —  133,849 
Interest and preferred dividends payable
14,480 3,138 2,790 — (58)[1]20,350 
Taxes accrued, including revenue taxes135,018 29,869 27,637 — — 192,524 
Regulatory liabilities20,224 8,785 8,292 — — 37,301 
Other57,926 13,851 18,621 — (16,136)[1]74,262 
Total current liabilities439,328 94,111 82,450 — (42,894)572,995 
Deferred credits and other liabilities      
Operating lease liabilities67,824 1,344 326 — — 69,494 
Deferred income taxes282,685 54,108 61,005 — — 397,798 
Regulatory liabilities656,270 173,938 92,277 — — 922,485 
Unamortized tax credits82,563 15,363 13,989 — — 111,915 
Defined benefit pension and other postretirement benefit plans liability
373,112 77,679 79,741 — — 530,532 
Other69,558 19,710 25,373 — — 114,641 
Total deferred credits and other liabilities
1,532,012 342,142 272,711 — — 2,146,865 
Total capitalization and liabilities$5,251,977 977,151 897,953 77 (669,785)$6,457,373 
Consolidating statements of changes in common stock equity
(in thousands)Hawaiian ElectricHawaii Electric LightMaui ElectricOther subsidiariesConsolidating
adjustments		Hawaiian Electric
Consolidated
Balance, December 31, 2018$1,957,641 295,874 280,863 101 (576,838)$1,957,641 
Net income for common stock156,840 20,817 22,350 — (43,167)156,840 
Other comprehensive income, net of taxes(1,378)(12)(174)— 186 (1,378)
Issuance of common stock, net of expenses35,501 (1)4,899 — (4,898)35,501 
Common stock dividends(101,252)(17,680)(15,068)— 32,748 (101,252)
Balance, December 31, 20192,047,352 298,998 292,870 101 (591,969)2,047,352 
Net income for common stock169,340 27,493 20,011 — (47,504)169,340 
Other comprehensive loss, net of tax benefits(1,640)(220)(134)— 354 (1,640)
Issuance of common stock, net of expenses
34,000 7,500 11,000 — (18,500)34,000 
Common stock dividends(107,134)(16,320)(14,384)— 30,704 (107,134)
Dissolution of subsidiary— — — (24)24 — 
Balance, December 31, 20202,141,918 317,451 309,363 77 (626,891)2,141,918 
Net income for common stock177,642 21,180 24,173 — (45,353)177,642 
Other comprehensive loss, net of tax benefits(361)66 227 — (293)(361)
Issuance of common stock, net of expenses
54,400 8,803 24,597 — (33,400)54,400 
Common stock dividends(111,700)(14,600)(15,100)— 29,700 (111,700)
Balance, December 31, 2021$2,261,899 332,900 343,260 77 (676,237)$2,261,899 
Consolidating statement of cash flows
Year ended December 31, 2021
(in thousands)Hawaiian ElectricHawaii Electric LightMaui ElectricOther subsidiariesConsolidating
adjustments		Hawaiian Electric
 Consolidated
Cash flows from operating activities       
Net income $178,722 21,714 24,554 — (45,353)[2]$179,637 
Adjustments to reconcile net income to net cash provided by operating activities       
Equity in earnings of subsidiaries(45,353)— — — 45,353 [2]— 
Common stock dividends received from subsidiaries29,700 — — — (29,700)[2]— 
Depreciation of property, plant and equipment155,607 40,201 33,661 — —  229,469 
Other amortization 16,688 3,532 1,517 — —  21,737 
Deferred income taxes(3,191)(1,955)1,317 — — (3,829)
State refundable credit(7,120)(1,672)(1,790)— — (10,582)
Bad debt expense1,159 509 515 — — 2,183 
Allowance for equity funds used during construction(7,734)(586)(1,214)— —  (9,534)
Bill credits1,400 300 300 — — 2,000 
Other366 (41)1,025 — — 1,350 
Changes in assets and liabilities:   
Increase in accounts receivable(41,727)(6,832)(3,071)— 1,540 [1](50,090)
Increase in accrued unbilled revenues(18,345)(5,816)(3,303)— —  (27,464)
Increase in fuel oil stock(32,407)(4,343)(9,090)— —  (45,840)
Decrease (increase) in materials and supplies(3,220)169 (1,482)— —  (4,533)
Decrease (increase) in regulatory assets(15,422)24 1,524 — —  (13,874)
Increase (decrease) in regulatory liabilities16,269 (1,031)120 15,358 
Increase in accounts payable 9,828 4,723 3,120 — —  17,671 
Change in prepaid and accrued income taxes, tax credits and revenue taxes21,217 3,861 1,938 — (86)[1]26,930 
Decrease in defined benefit pension and other postretirement benefit plans liability(3,480)(950)(724)— — (5,154)
Change in other assets and liabilities(36,733)(5,833)(8,196)— (1,540)[1](52,302)
Net cash provided by operating activities216,224 45,974 40,721 — (29,786)273,133 
Cash flows from investing activities       
Capital expenditures (194,984)(50,516)(46,500)— — (292,000)
Advances from affiliates25,700 — — — (25,700)[1]— 
Other (29,596)1,072 1,073 33,486 [1],[2]6,035 
Net cash used in investing activities(198,880)(49,444)(45,427)— 7,786 (285,965)
Cash flows from financing activities       
Common stock dividends(111,700)(14,600)(15,100)— 29,700 [2](111,700)
Preferred stock dividends of Hawaiian Electric and subsidiaries(1,080)(534)(381)— —  (1,995)
Proceeds from issuance of common stock54,400 8,803 24,597 — (33,400)[2]54,400 
Proceeds from issuance of long-term debt60,000 30,000 25,000 — —  115,000 
Net decrease in short-term borrowings from non-affiliates and affiliate with original maturities of three months or less— (17,800)(7,900)— 25,700 [1]— 
Repayment of short-term debt(50,000)— — — — (50,000)
Other(702)(119)(120)— — (941)
Net cash provided by (used in) financing activities(49,082)5,750 26,096 — 22,000  4,764 
Net increase (decrease) in cash, cash equivalents and restricted cash(31,738)2,280 21,390 — —  (8,068)
Cash, cash equivalents and restricted cash, January 158,171 3,046 2,032 77 —  63,326 
Cash, cash equivalents and restricted cash, December 3126,433 5,326 23,422 77 —  55,258 
Less: Restricted cash(3,089)— — — — (3,089)
Cash and cash equivalents, December 31$23,344 5,326 23,422 77 — $52,169 
Consolidating statement of cash flows
Year ended December 31, 2020
(in thousands)Hawaiian ElectricHawaii Electric LightMaui ElectricOther subsidiariesConsolidating
adjustments		Hawaiian Electric
Consolidated
Cash flows from operating activities       
Net income $170,420 28,027 20,392 — (47,504)[2]$171,335 
Adjustments to reconcile net income to net cash provided by operating activities
       
Equity in earnings of subsidiaries
(47,504)— — — 47,504 [2]— 
Common stock dividends received from subsidiaries
30,704 — — — (30,704)[2]— 
Depreciation of property, plant and equipment
151,387 39,041 32,305 — —  222,733 
Other amortization24,511 5,090 4,145 — — 33,746 
Deferred income taxes
2,130 (463)1,484 — — 3,151 
State refundable credit
(6,668)(1,593)(1,700)— — (9,961)
Bad debt expense1,042 620 453 — — 2,115 
Allowance for equity funds used during construction
(7,335)(543)(890)— —  (8,768)
Accrued environmental reserve6,556 — — — — 6,556 
Other
1,201 1,322 87 — — 2,610 
Changes in assets and liabilities:   
Increase in accounts receivable(8,093)(3,349)(1,343)— 5,499 [1](7,286)
Decrease in accrued unbilled revenues8,832 3,327 3,126 — —  15,285 
Decrease in fuel oil stock30,226 430 3,043 — —  33,699 
Increase in materials and supplies(3,910)(1,583)(1,149)— —  (6,642)
Decrease (increase) in regulatory assets8,526 (2,908)(4,611)— —  1,007 
Decrease in regulatory liabilities(5,490)(4,489)(6,583)(16,562)
Decrease in accounts payable (26,093)(1,819)(5,217)— —  (33,129)
Change in prepaid and accrued income taxes, tax credits and revenue taxes
(25,757)(5,483)(5,998)— 58 [1](37,180)
Decrease in defined benefit pension and other postretirement benefit plans liability(3,092)(643)(571)— — (4,306)
Change in other assets and liabilities
(21,124)(8,864)3,635 — (5,499)[1](31,852)
Net cash provided by operating activities
280,469 46,120 40,608 — (30,646) 336,551 
Cash flows from investing activities
       
Capital expenditures (229,127)(64,346)(57,391)— —  (350,864)
Advances from affiliates1,000 8,000 — — (9,000)[1]— 
Other (14,340)1,032 960 (24)18,442 [1],[2]6,070 
Net cash used in investing activities(242,467)(55,314)(56,431)(24)9,442  (344,794)
Cash flows from financing activities       
Common stock dividends(107,134)(16,320)(14,384)— 30,704 [2](107,134)
Preferred stock dividends of Hawaiian Electric and subsidiaries
(1,080)(534)(381)— —  (1,995)
Proceeds from the issuance of common stock
34,000 7,500 11,000 — (18,500)[2]34,000 
Proceeds from the issuance of long-term debt
205,000 10,000 40,000 — — 255,000 
Repayment of long-term debt(95,000)(14,000)— — — (109,000)
Net increase (decrease) in short-term borrowings from non-affiliates and affiliate with original maturities of three months or less(46,987)18,800 (19,800)— 9,000 [1](38,987)
Proceeds from issuance of short-term debt100,000 — — — — 100,000 
Repayment of short-term debt(100,000)— — — — (100,000)
Other(1,618)(214)(377)— —  (2,209)
Net cash provided by (used in) financing activities
(12,819)5,232 16,058 — 21,204  29,675 
Net increase (decrease) in cash, cash equivalents and restricted cash
25,183 (3,962)235 (24)—  21,432 
Cash, cash equivalents and restricted cash, January 1
32,988 7,008 1,797 101 —  41,894 
Cash, cash equivalents and restricted cash, December 31
58,171 3,046 2,032 77 —  63,326 
Less: Restricted cash
(15,966)— — — — (15,966)
Cash and cash equivalents, December 31
$42,205 3,046 2,032 77 — $47,360 
Consolidating statement of cash flows
Year ended December 31, 2019
(in thousands)Hawaiian ElectricHawaii Electric LightMaui ElectricOther subsidiariesConsolidating
adjustments		Hawaiian Electric
Consolidated
Cash flows from operating activities       
Net income $157,920 21,351 22,731 — (43,167)[2]$158,835 
Adjustments to reconcile net income to net cash provided by operating activities
       
Equity in earnings of subsidiaries
(43,204)— — — 43,167 [2](37)
Common stock dividends received from subsidiaries
32,783 — — — (32,748)[2]35 
Depreciation of property, plant and equipment
143,470 41,812 30,449 — —  215,731 
Other amortization23,351 4,810 1,470 — —  29,631 
Deferred income taxes
(13,547)(2,383)(354)— — (16,284)
State refundable credit
(6,245)(559)(1,565)— — (8,369)
Bad debt expense1,236 470 444 — — 2,150 
Allowance for equity funds used during construction
(9,955)(816)(1,216)— —  (11,987)
Accrued environmental reserve406 — — — — 406 
Other
27,575 (61)(55)— — 27,459 
Changes in assets and liabilities:    
Decrease in accounts receivable24,150 2,858 3,029 — (11,215)[1]18,822 
Decrease (increase) in accrued unbilled revenues4,902 (22)(385)— —  4,495 
Decrease (increase) in fuel oil stock(14,741)2,126 613 — —  (12,002)
Decrease (increase) in materials and supplies
(4,585)(1,158)245 — —  (5,498)
Decrease in regulatory assets55,494 9,218 6,550 — —  71,262 
Increase (decrease) in regulatory liabilities102 (1,558)3,409 1,953 
Increase (decrease) in accounts payable 4,687 (3,160)(3,578)— —  (2,051)
Change in prepaid and accrued income taxes, tax credits and revenue taxes
(24,900)(893)(3,097)— 367 [1](28,523)
Decrease in defined benefit pension and other postretirement benefit plans liability(3,033)(762)(653)— — (4,448)
Change in other assets and liabilities
(15,747)(6,152)(6,940)— 11,215 [1](17,624)
Net cash provided by operating activities
340,119 65,121 51,097 — (32,381) 423,956 
Cash flows from investing activities
       
Capital expenditures (311,538)(49,811)(58,549)— —  (419,898)
Advances to affiliates(27,700)(8,000)— — 35,700 [1]— 
Other 5,241 297 1,303 — 4,533 [1][2]11,374 
Net cash used in investing activities(333,997)(57,514)(57,246)— 40,233  (408,524)
Cash flows from financing activities       
Common stock dividends(101,252)(17,680)(15,068)— 32,748 [2](101,252)
Preferred stock dividends of Hawaiian Electric and subsidiaries
(1,080)(534)(381)— —  (1,995)
Proceeds from the issuance of common stock
35,500 — 4,900 — (4,900)[2]35,500 
Proceeds from the issuance of long-term debt
190,000 72,500 17,500 — — 280,000 
Repayment of long-term debt and funds transferred for repayment of long-term debt(183,546)(70,000)(30,000)— — (283,546)
Net increase in short-term borrowings from non-affiliates and affiliate with original maturities of three months or less46,987 — 27,700 — (35,700)[1]38,987 
Proceeds from issuance of short-term debt75,000 — — — — 75,000 
Other(1,475)(508)(126)— —  (2,109)
Repayment of short-term debt(50,000)— — — — (50,000)
Net cash provided by (used in) financing activities
10,134 (16,222)4,525 — (7,852) (9,415)
Net increase (decrease) in cash, cash equivalents and restricted cash16,256 (8,615)(1,624)— —  6,017 
Cash, cash equivalents and restricted cash, January 116,732 15,623 3,421 101 —  35,877 
Cash, cash equivalents and restricted cash, December 31
32,988 7,008 1,797 101 — 41,894 
Less: Restricted cash
(30,749)(123)— — — (30,872)
Cash and cash equivalents, December 31
$2,239 6,885 1,797 101 — $11,022 
Explanation of consolidating adjustments on consolidating schedules:
[1] Eliminations of intercompany receivables and payables and other intercompany transactions
[2] Elimination of investment in subsidiaries, carried at equity