Retirement benefits

Defined benefit pension and other postretirement benefit plans information. For the first nine months of 2014, the Company contributed $45 million ($44 million by the Utilities) to its pension and other postretirement benefit plans, compared to $62 million ($61 million by the Utilities) in the first nine months of 2013. The Company’s current estimate of contributions to its pension and other postretirement benefit plans in 2014 is $60 million ($59 million by the Utilities, $1 million by HEI and nil by ASB), compared to $83 million ($81 million by the Utilities, $2 million by HEI and nil by ASB) in 2013. In addition, the Company expects to pay directly $2 million ($1 million by the Utilities) of benefits in 2014, compared to $2 million ($1 million by the Utilities) paid in 2013.

On July 6, 2012, President Obama signed the Moving Ahead for Progress in the 21st Century Act (MAP-21), which included provisions related to the funding and administration of pension plans. This law does not affect the Company’s or the Utilities' accounting for pension benefits; therefore, the net periodic benefit costs disclosed for the plans were not affected. The Company elected to apply MAP-21 for 2012, which improved the plans’ Adjusted Funding Target Attainment Percentage for funding and benefit distribution purposes and thereby reduced the 2012 minimum funding requirement and lifted the restrictions on accelerated distribution options (which restrictions were in effect from April 1, 2011 to September 30, 2012) for HEI and the Utilities. MAP-21 caused the minimum required funding under the Employee Retirement Income Security Act of 1974, as amended (ERISA) to be less than the net periodic cost for 2013 and 2014; therefore, to satisfy the requirements of the Utilities pension and OPEB tracking mechanisms, the Utilities will contribute the net periodic cost in 2014.

The Pension Protection Act provides that if a pension plan’s funded status falls below certain levels, more conservative assumptions must be used to value obligations under the pension plan. The HEI Retirement Plan met the threshold requirements in each of 2012 and 2013 so that the more conservative assumptions did not apply for either the 2013 or 2014 valuation of plan liabilities for purposes of calculating the minimum required contribution. Other factors could cause changes to the required contribution levels.

The components of net periodic benefit cost for HEI consolidated and Hawaiian Electric consolidated were as follows:



	Three months ended September 30												Nine months ended September 30
	Pension benefits						Other benefits						Pension benefits						Other benefits
(in thousands)	2014			2013			2014			2013			2014			2013			2014			2013
HEI consolidated
Service cost	$	12,306		$	14,097		$	870		$	1,077		$	36,958		$	42,307		$	2,619		$	3,229
Interest cost	18,044			16,187			2,137			1,891			54,158			48,600			6,414			5,677
Expected return on plan assets	(20,337		)	(18,134		)	(2,724		)	(2,531		)	(61,018		)	(54,401		)	(8,180		)	(7,614		)
Amortization of net prior service loss (gain)	22			(24		)	(448		)	(448		)	66			(73		)	(1,345		)	(1,345		)
Amortization of net actuarial loss (gain)	5,064			9,560			(2		)	398			15,240			28,878			(8		)	1,203
Net periodic benefit cost (credit)	15,099			21,686			(167		)	387			45,404			65,311			(500		)	1,150
Impact of PUC D&Os	(3,331		)	(9,257		)	494			(332		)	(9,993		)	(28,847		)	1,482			(1,018		)
Net periodic benefit cost (adjusted for impact of PUC D&Os)	$	11,768		$	12,429		$	327		$	55		$	35,411		$	36,464		$	982		$	132
Hawaiian Electric consolidated
Service cost	$	11,900		$	13,620		$	848		$	1,041		$	35,698		$	40,861		$	2,544		$	3,122
Interest cost	16,495			14,780			2,058			1,822			49,484			44,339			6,175			5,466
Expected return on plan assets	(18,167		)	(16,138		)	(2,684		)	(2,502		)	(54,496		)	(48,413		)	(8,054		)	(7,502		)
Amortization of net prior service loss (gain)	15			(116		)	(451		)	(451		)	46			(348		)	(1,353		)	(1,353		)
Amortization of net actuarial loss	4,616			8,649			—			387			13,845			25,948			—			1,159
Net periodic benefit cost (credit)	14,859			20,795			(229		)	297			44,577			62,387			(688		)	892
Impact of PUC D&Os	(3,331		)	(9,257		)	494			(332		)	(9,993		)	(28,847		)	1,482			(1,018		)
Net periodic benefit cost (adjusted for impact of PUC D&Os)	$	11,528		$	11,538		$	265		$	(35	)	$	34,584		$	33,540		$	794		$	(126	)

HEI consolidated recorded retirement benefits expense of $24 million ($23 million by the Utilities) and $24 million ($21 million by the Utilities) in the first nine months of 2014 and 2013, respectively, and charged the remaining net periodic benefit cost primarily to electric utility plant.

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

Defined contribution plans information. For the first nine months of 2014 and 2013, the Company’s expense for its defined contribution pension plans under the Hawaiian Electric Industries Retirement Savings Plan (HEIRSP) and the ASB 401(k) Plan was $3.4 million and $3.1 million, respectively, and cash contributions were $4.2 million and $3.7 million, respectively. For the first nine months of 2014 and 2013, the Utilities’ expense for its defined contribution pension plan was $0.7 million and $0.4 million, respectively, and cash contributions were $0.7 million and $0.4 million, respectively.