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Electric utility segment
 6 Months Ended
Jun. 30, 2020
Electric utility subsidiary [Abstract]  
Electric utility segment Electric utility segment
Unconsolidated variable interest entities.
Power purchase agreements.  As of June 30, 2020, the Utilities had four PPAs for firm capacity (excluding the Puna Geothermal Ventures (PGV) PPA as PGV has been offline since May 2018 due to lava flow on Hawaii Island) 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 condensed consolidated financial statements. Hamakua Energy is an indirect subsidiary of Pacific Current and is consolidated in HEI’s condensed consolidated financial statements.
For the other PPAs with IPPs, the Utilities have concluded that the consolidation of the IPPs was not required because either the Utilities do not have variable interests in the IPPs due to the absence of an obligation in the PPAs for the Utilities to absorb any variability of the IPPs, or the IPP was considered a “governmental organization,” and thus excluded from the scope of accounting standards for VIEs. Two IPPs of as-available energy declined to provide the information necessary for Utilities to determine the applicability of accounting standards for VIEs. If information is ultimately received from the IPPs, a possible outcome of future analyses of such information is the consolidation of one or both of such IPPs in the unaudited condensed consolidated financial statements. The consolidation of any significant IPP could have a material effect on the unaudited condensed consolidated financial statements, including the recognition of a significant amount of assets and liabilities and, if such a consolidated IPP were operating at a loss and had insufficient equity, the potential recognition of such losses. If the Utilities determine they are required to consolidate the financial statements of such an IPP and the consolidation has a material effect, the Utilities would retrospectively apply accounting standards for VIEs to the IPP.
Commitments and contingencies.
Contingencies. The Utilities are subject in the normal course of business to 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:
 Three months ended June 30Six months ended June 30
(in millions)2020201920202019
Kalaeloa$34  $61  $72  $101  
AES Hawaii32  32  63  64  
HPOWER17  19  34  37  
Hamakua Energy11  18  24  34  
Wind IPPs25  23  53  43  
Solar IPPs17  8  28  15  
Other IPPs 1
1  1  3  2  
Total IPPs$137  $162  $277  $296  
 
1Includes hydro power and other PPAs
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 are currently in negotiations to address the PPA term that ended on May 23, 2016. The PPA automatically extends on a month-to-month basis as long as the parties are still negotiating in good faith. Hawaiian Electric and Kalaeloa have agreed that neither party will terminate the PPA (which has been subject to automatic extension on a month-to-month basis) prior to November 20, 2020, to allow for a negotiated resolution and PUC approval.
AES Hawaii, Inc. Under a PPA entered into in March 1988, as amended (through Amendment No. 2) 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. 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. If approved by the PUC, the amendment will resolve AES Hawaii’s claims related to the additional capacity.
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 Green House 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. On June 20, 2019, the PUC issued an order reopening the docket for further proceedings, including re-examining all of the issues in the proceedings. On September 29, 2019, the PUC issued an order setting the procedural schedule for the matter and on December 20, 2019, issued an order modifying the procedural schedule. Pre-hearing matters were completed on March 6, 2020. On July 9, 2020, the PUC issued an order denying the 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 July 20, 2020, Hu Honua filed a motion for reconsideration of the PUC’s order which is currently pending review by the PUC.
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 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. Starting in January 2020, Hawaii Electric Light began to incorporate their portion of the deferred project costs in rate base and start the amortization over a 12-year period. As of June 30, 2020, the total deferred project costs and accrued carrying costs after the project went into service amounted to $59.4 million, which is net of the amortization of $0.3 million at Hawaii Electric Light.
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 June 30, 2020, the Utilities’ regulatory liability was $7.2 million for amounts to be returned to customers for reduction in O&M expense included in rates.
At the PUC’s direction, the Utilities have been filing Semi-Annual Enterprise System Benefits (SAESB) reports. The most recent SAESB report was filed on February 26, 2020 for the period July 1 through December 31, 2019.
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 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 June 30, 2020, representing the probable and reasonably estimable undiscounted cost for remediation of the Site and the Adjacent Parcel; however, final costs of remediation will depend on the cleanup approach implemented.
Pearl Harbor sediment study. In July 2014, the U.S. Navy notified Hawaiian Electric of the Navy’s determination that Hawaiian Electric is a Potentially Responsible Party responsible for the costs of investigation and cleanup of PCB contamination in sediment in the area offshore of the Waiau Power Plant as part of the Pearl Harbor Superfund Site. Hawaiian Electric was also required by the EPA to assess potential sources and extent of PCB contamination onshore at Waiau Power Plant.
As of June 30, 2020, the reserve account balance recorded by Hawaiian Electric to address the PCB contamination was $4.8 million. The reserve balance represents the probable and reasonably estimable undiscounted cost for the onshore investigation and the remediation of PCB contamination in the offshore sediment. The final remediation costs will depend on the potential onshore source control requirements and actual offshore cleanup costs.
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. The decoupling mechanism has 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 kilowatthour sales, (2) rate adjustment mechanism (RAM) revenues for escalation in certain O&M expenses and rate base changes, (3) major project interim recovery (MPIR) component, (4) performance incentive mechanisms (PIMs), and (5) an earnings sharing mechanism, which would provide for a reduction of revenues between rate cases in the event the utility exceeds the return on average common equity (ROACE) allowed in its most recent rate case. The requirement for triennial general rate cases under the decoupling mechanism was terminated by the PUC on April 29, 2020.
Rate 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). Annualized target revenues reset upon the issuance of an interim or final decision and order (D&O) in a rate case. All Utilities were limited to the RAM Cap in 2020.
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.
The 2019 approved MPIR amounts for Schofield Generating Station of $19.8 million (which accrued effective January 1, 2019), included the 2019 return on project amount (up to the capped amount) in rate base, depreciation and incremental O&M expenses, are collected from June 2020 through May 2021.
The PUC approved the Utilities’ requests for MPIR recovery of the cost of the Grid Modernization Strategy Phase 1 project and West Loch Photovoltaic (PV) project in March and December 2019, respectively. On June 5, 2020, the Utilities submitted 2020 MPIR amounts totaling $23.6 million for the Schofield Generation Station ($19.2 million), West Loch PV project ($3.8 million) and Grid Modernization Strategy Phase 1 project ($0.6 million for all three utilities) for the accrual of revenues effective January 1, 2020, that included the 2020 return on project amount (up to the capped amount) in rate base, depreciation and incremental O&M expenses, for collection from June 2021 through May 2022, subject to PUC review.
Performance incentive mechanisms. The PUC has established the following PIMs:
•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 be re-determined upon issuance of an interim or final order in a general rate case for each utility.
•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).
•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).
•In December 2019, the Utilities accrued $0.3 million in estimated rewards for call center performance, net of service reliability penalties, for 2019. The net service quality performance rewards related to 2019 was reflected in the 2020 annual decoupling filing and increased customer rates in the period June 1, 2020 through May 31, 2021.
•Procurement of low-cost variable renewable resources through the request for proposal process in 2018 is measured by comparison of the procurement price to target prices. The incentive is a percentage of the savings determined by comparing procured price to a target of 11.5 cents per kilowatt-hour for renewable projects with storage capability and 9.5 cents per kilowatt-hour for energy-only renewable projects. Half of the incentive was earned upon PUC approval of the PPAs and the other half is eligible to be earned in the year following the in-service date of the projects and is dependent on the amount of energy the Utilities receive from the facilities. The total amount of the incentive the Utilities are eligible for is capped at $3.5 million. Based on the seven PPAs approved in 2019, the Utilities recognized $1.7 million in 2019.
On October 9, 2019, the PUC issued an order establishing PIMs for the Utilities with regards to the Variable Renewable Dispatchable Generation and Energy Storage requests for proposals (RFPs) as well as the Delivery of Grid Services via Customer-sited Distributed Energy Resources RFPs that were issued on August 22, 2019 for Oahu, Maui and Hawaii island. The order establishes pricing thresholds, timelines to complete contracting, and other performance criteria for the performance incentive eligibility. The PIMs provide incentives only without penalties. The earliest the Utilities would be eligible for a PIM pursuant to this order is upon PUC approval of executed contracts resulting from the Phase 2 RFPs. The order requires contracts under the Grid Service RFP be filed for approval by May 2020 (subsequently extended to July 9, 2020), and by September 2020 under the Renewable RFPs, with a declining PIM for projects that are not filed by these deadlines. On July 9, 2020, the Utilities filed two Grid Service Purchase Agreements for the Grid Service RFP, which qualify for PIMs, however, details of the incentive metrics will be determined by PUC.
Annual decoupling filings. The net annual incremental amounts to be collected (refunded) from June 1, 2020 through May 31, 2021 are as follows:
(in millions)Hawaiian ElectricHawaii Electric LightMaui ElectricTotal
2020 Annual incremental RAM adjusted revenues
$20.6  $3.2  $5.7  $29.5  
Annual change in accrued RBA balance as of December 31, 2019 (and associated revenue taxes) which incorporates MPIR recovery
(46.5) (9.9) (11.0) (67.4) 
Incremental Performance Incentive Mechanisms (net)
2.2  (0.1) (0.1) 2.0  
Net annual incremental amount to be collected (refunded) under the tariffs$(23.7) $(6.8) $(5.4) $(35.9) 

Performance-based regulation proceeding. On April 18, 2018, the PUC issued an order, instituting a proceeding to investigate performance-based regulation (PBR). The PUC stated that PBR seeks to utilize both revenue adjustment mechanisms and performance mechanisms to more strongly align utilities’ incentives with customer interests.
The order stated that, in general, the PUC is interested in ratemaking elements and/or mechanisms that result in:
•Greater cost control and reduced rate volatility;
•Efficient investment and allocation of resources regardless of classification as capital or operating expense;
•Fair distribution of risks between utilities and customers; and
•Fulfillment of State policy goals.
The proceeding has two phases. Phase 1 examined the current regulatory framework and identified those areas of utility performance that are deserving of further focus in Phase 2. In May 2019, the PUC issued an order concluding Phase 1, which established guiding principles, regulatory goals, and priority outcomes to guide the development of the PBR mechanisms in Phase 2. The PUC identified the following guiding principles, which will inform the development of the PBR framework: 1) a customer-centric approach, 2) administrative efficiency to reduce regulatory burdens; and 3) utility financial integrity to maintain the utility’s financial health. Priority goals (and priority outcomes) identified by the PUC were: enhance customer experience (affordability, reliability, interconnection experience, and customer engagement), improve utility performance (cost control, distributed energy resources (DER) asset effectiveness, and grid investment efficiency), and advance societal outcomes (capital formation, customer equity, greenhouse gas reduction, electrification of transportation, and resilience).
The order also outlined the PUC’s vision of a comprehensive PBR framework that would be further developed in Phase 2. The framework envisioned would include 1) a five-year multi-year rate plan with an index-driven annual revenue adjustment based on an inflation factor, an X-factor which would encompass productivity, a Z-factor to account for exceptional circumstances not in the utility’s control and a customer dividend, 2) a symmetric earnings sharing mechanism that would help ensure that utility earnings do not excessively benefit or suffer from external factors outside of utility control or unforeseen results of regulatory mechanisms, 3) off-ramp provisions, 4) continuation of the RBA, MPIR adjustment mechanism, the pension and OPEB tracking mechanism, and other recovery mechanisms, and 5) a portfolio of performance incentive mechanisms for customer engagement and DER asset effectiveness (rewards only), and interconnection experience (both rewards and penalties), in addition to scorecards to track progress against targeted performance levels, shared savings mechanisms to apportion savings to the utility and customers, and reported metrics.
The Phase 2 schedule included working group meetings through the first half of 2020, followed by statements of positions that were filed in June 2020. The remainder of the Phase 2 schedule includes discovery, reply statements of positions in August 2020, an evidentiary hearing in September 2020 and anticipated decision in December 2020. The latest procedural schedule includes steps after the Phase 2 D&O “to review and approve PBR tariffs.”
Most recent rate proceedings.
Hawaiian Electric 2020 test year rate case. On May 27, 2020, Hawaiian Electric and the Consumer Advocate filed a Stipulated Settlement Letter, documenting a global settlement of all issues in this rate case. The Parties agreed that as a result of this settlement agreement, there will be no increase in electric revenues over the revenues established in the 2017 test year rate case. The settlement agreement is subject to PUC approval.
On May 13, 2020, the PUC issued its Final Report on the Management Audit, which recommended various operational and organizational changes intended to better manage costs and provide value to customers. The report also recommended a three-year timeframe to ramp up to a sustained $25 million in annual savings by the end of 2022, split between capital (approximately 80%) and O&M (approximately 20%). In its statement of position on the management audit filed on June 17, 2020, Hawaiian Electric committed to deliver these savings to customers over time through a proposal it later submitted in its statement of position in the PBR proceeding. The PUC’s decisions on the settlement agreement and on the remaining procedural steps in this proceeding are pending.
Hawaii Electric Light 2019 test year rate case. On September 24, 2019, Hawaii Electric Light and the Consumer Advocate filed a Stipulated Partial Settlement Letter which documented agreements reached on all of the issues in the proceeding, except for the ROACE, capital structure, amortization period for the state investment tax credit, and automatic annual target heat rate adjustment. On November 13, 2019, the PUC issued an interim decision maintaining Hawaii Electric Light’s revenues at current effective rates based on an interim revenue requirement of $387 million, average rate base of $534 million, and a 7.52% return on rate base (RORB) that incorporates a ROACE of 9.5% and 58.0% total equity ratio, and tariffs became effective January 1, 2020 . On July 28, 2020, the PUC issued an order, 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 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. Hawaii Electric Light is to submit proposed final tariffs and a revised ECRC tariff for the PUC’s review within 30 days of this order.
Maui Electric 2021 test year rate case. By an order issued on April 29, 2020, the PUC terminated the requirement of a mandatory triennial rate case cycle that was established in the Decoupling final D&O, and indicated Maui Electric is not required to file a 2021 test year rate case. Maui Electric does not intend to file a 2021 test year rate case.
Regulatory assets for COVID-19 related expenses. On April 22, 2020, the Utilities filed a request to the PUC for deferral treatment of COVID-19 related expenses, including higher bad debt expense and write-offs, higher financing costs and other expenses. 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. On June 30, 2020, the PUC issued an order on the Utilities request for deferral treatment of COVID-19 related expenses through December 31, 2020, and allowed the Utilities to file application to request an extension of the deferral period beyond December 31, 2020. Beginning on July 31, 2020, the Utilities are required to file quarterly reports to update the Utilities’ financial condition, measures in place to assist their customers during the COVID-19 emergency situation, identifying the planned deferred costs and details for the deferred costs, and identifying funds received or benefits received that have resulted from the COVID-19 emergency period. As of June 30, 2020, the Utilities recorded a total of $6.5 million in regulatory assets pursuant to the order.
Condensed consolidating financial information. Condensed consolidating financial information for Hawaiian Electric and its subsidiaries are presented for the three and six month periods ended June 30, 2020 and 2019, and as of June 30, 2020 and December 31, 2019.
Hawaiian Electric unconditionally guarantees Hawaii Electric Light’s and Maui Electric’s obligations (a) to the State of Hawaii for the repayment of principal and interest on Special Purpose Revenue Bonds issued for the benefit of Hawaii Electric Light and Maui Electric, and (b) under their respective private placement note agreements and the Hawaii Electric Light notes and Maui Electric notes issued thereunder. Hawaiian Electric is also obligated, after the satisfaction of its obligations on its own preferred stock, to make dividend, redemption and liquidation payments on Hawaii Electric Light’s and Maui Electric’s preferred stock if the respective subsidiary is unable to make such payments.
Hawaiian Electric Company, Inc. and Subsidiaries
Condensed Consolidating Statement of Income
Three months ended June 30, 2020

(in thousands)Hawaiian ElectricHawaii Electric LightMaui Electric
Other subsidiaries
Consolidating adjustments
Hawaiian Electric
Consolidated
Revenues$380,634  78,505  75,216  —  (140) $534,215  
Expenses
Fuel oil77,290  16,254  18,907  —  —  112,451  
Purchased power108,946  15,846  12,046  —  —  136,838  
Other operation and maintenance74,274  17,581  18,186  —  —  110,041  
Depreciation37,860  9,761  8,075  —  —  55,696  
Taxes, other than income taxes36,673  7,470  7,245  —  —  51,388  
   Total expenses335,043  66,912  64,459  —  —  466,414  
Operating income45,591  11,593  10,757  —  (140) 67,801  
Allowance for equity funds used during construction1,807  193  194  —  —  2,194  
Equity in earnings of subsidiaries13,776  —  —  —  (13,776) —  
Retirement defined benefits expense—other than service costs(546) 193  (29) —  —  (382) 
Interest expense and other charges, net(12,499) (2,533) (2,446) —  140  (17,338) 
Allowance for borrowed funds used during construction626  62  64  —  —  752  
Income before income taxes48,755  9,508  8,540  —  (13,776) 53,027  
Income taxes6,156  2,196  1,847  10,199  
Net income42,599  7,312  6,693  —  (13,776) 42,828  
Preferred stock dividends of subsidiaries—  133  96  —  229  
Net income attributable to Hawaiian Electric
42,599  7,179  6,597  —  (13,776) 42,599  
Preferred stock dividends of Hawaiian Electric270  —  —  —  —  270  
Net income for common stock$42,329  7,179  6,597  —  (13,776) $42,329  

Hawaiian Electric Company, Inc. and Subsidiaries
Condensed Consolidating Statement of Comprehensive Income
Three months ended June 30, 2020

(in thousands)Hawaiian ElectricHawaii Electric LightMaui ElectricOther
subsidiaries		Consolidating
adjustments		Hawaiian Electric
Consolidated
Net income for common stock$42,329  7,179  6,597  —  (13,776) $42,329  
Other comprehensive income (loss), net of taxes:      
Retirement benefit plans:      
Adjustment for amortization of prior service credit and net losses recognized during the period in net periodic benefit cost, net of tax benefits5,184  751  650  —  (1,401) 5,184  
Reclassification adjustment for impact of D&Os of the PUC included in regulatory assets, net of taxes(5,159) (748) (653) —  1,401  (5,159) 
Other comprehensive income (loss), net of taxes25  3  (3) —  —  25  
Comprehensive income attributable to common shareholder
$42,354  7,182  6,594  —  (13,776) $42,354  
Hawaiian Electric Company, Inc. and Subsidiaries
Condensed Consolidating Statement of Income
Three months ended June 30, 2019
(in thousands)Hawaiian ElectricHawaii Electric LightMaui Electric
Other subsidiaries
Consolidating adjustments
Hawaiian Electric
Consolidated
Revenues$450,020  89,916  94,050  —  (202) $633,784  
Expenses
Fuel oil125,431  19,941  36,248  —  —  181,620  
Purchased power126,871  24,029  11,954  —  —  162,854  
Other operation and maintenance78,551  18,031  22,678  —  —  119,260  
Depreciation35,868  10,453  7,592  —  —  53,913  
Taxes, other than income taxes42,590  8,706  9,147  —  —  60,443  
   Total expenses409,311  81,160  87,619  —  —  578,090  
Operating income40,709  8,756  6,431  —  (202) 55,694  
Allowance for equity funds used during construction2,614  218  343  —  —  3,175  
Equity in earnings of subsidiaries8,086  —  —  —  (8,086) —  
Retirement defined benefits expense—other than service costs(567) (105) (29) —  —  (701) 
Interest expense and other charges, net(13,390) (2,920) (2,422) —  202  (18,530) 
Allowance for borrowed funds used during construction962  91  126  —  —  1,179  
Income before income taxes38,414  6,040  4,449  —  (8,086) 40,817  
Income taxes5,570  1,241  933  —  —  7,744  
Net income32,844  4,799  3,516  —  (8,086) 33,073  
Preferred stock dividends of subsidiaries—  133  96  —  —  229  
Net income attributable to Hawaiian Electric
32,844  4,666  3,420  —  (8,086) 32,844  
Preferred stock dividends of Hawaiian Electric270  —  —  —  —  270  
Net income for common stock$32,574  4,666  3,420  —  (8,086) $32,574  

Hawaiian Electric Company, Inc. and Subsidiaries
Condensed Consolidating Statement of Comprehensive Income
Three months ended June 30, 2019

(in thousands)Hawaiian ElectricHawaii Electric LightMaui ElectricOther
subsidiaries		Consolidating
adjustments		Hawaiian Electric
Consolidated
Net income for common stock$32,574  4,666  3,420  —  (8,086) $32,574  
Other comprehensive income (loss), net of taxes:      
Retirement benefit plans:      
Adjustment for amortization of prior service credit and net losses recognized during the period in net periodic benefit cost, net of tax benefits2,321  352  289  —  (641) 2,321  
Reclassification adjustment for impact of D&Os of the PUC included in regulatory assets, net of taxes(2,298) (351) (289) —  640  (2,298) 
Other comprehensive income, net of taxes23  1  —  —  (1) 23  
Comprehensive income attributable to common shareholder
$32,597  4,667  3,420  —  (8,087) $32,597  
Hawaiian Electric Company, Inc. and Subsidiaries
Condensed Consolidating Statement of Income
Six months ended June 30, 2020

(in thousands)Hawaiian ElectricHawaii Electric LightMaui ElectricOther subsidiariesConsolidating adjustmentsHawaiian Electric
Consolidated
Revenues$801,800  167,798  162,414  —  (355) $1,131,657  
Expenses
Fuel oil197,825  38,686  49,161  —  —  285,672  
Purchased power216,897  35,367  24,390  —  —  276,654  
Other operation and maintenance159,911  36,685  40,992  —  —  237,588  
Depreciation75,871  19,521  16,154  —  —  111,546  
Taxes, other than income taxes77,174  15,812  15,452  —  —  108,438  
   Total expenses727,678  146,071  146,149  —  —  1,019,898  
Operating income74,122  21,727  16,265  —  (355) 111,759  
Allowance for equity funds used during construction3,550  312  347  —  —  4,209  
Equity in earnings of subsidiaries22,580  —  —  —  (22,580) —  
Retirement defined benefits expense—other than service costs(1,092) 387  (58) —  —  (763) 
Interest expense and other charges, net(24,501) (5,017) (4,769) —  355  (33,932) 
Allowance for borrowed funds used during construction1,228  98  114  —  —  1,440  
Income before income taxes75,887  17,507  11,899  —  (22,580) 82,713  
Income taxes9,113  3,994  2,374  —  —  15,481  
Net income66,774  13,513  9,525  —  (22,580) 67,232  
Preferred stock dividends of subsidiaries—  267  191  —  —  458  
Net income attributable to Hawaiian Electric66,774  13,246  9,334  —  (22,580) 66,774  
Preferred stock dividends of Hawaiian Electric540  —  —  —  —  540  
Net income for common stock$66,234  13,246  9,334  —  (22,580) $66,234  


Hawaiian Electric Company, Inc. and Subsidiaries
Condensed Consolidating Statement of Comprehensive Income
Six months ended June 30, 2020

(in thousands)Hawaiian ElectricHawaii Electric LightMaui ElectricOther subsidiariesConsolidating adjustmentsHawaiian Electric Consolidated
Net income for common stock$66,234  13,246  9,334  —  (22,580) $66,234  
Other comprehensive income (loss), net of taxes:
Retirement benefit plans:
Adjustment for amortization of prior service credit and net losses recognized during the period in net periodic benefit cost, net of tax benefits10,368  1,499  1,302  —  (2,801) 10,368  
Reclassification adjustment for impact of D&Os of the PUC included in regulatory assets, net of taxes(10,317) (1,495) (1,305) —  2,800  (10,317) 
Other comprehensive income (loss), net of taxes51  4  (3) —  (1) 51  
Comprehensive income attributable to common shareholder$66,285  13,250  9,331  —  (22,581) $66,285  
Hawaiian Electric Company, Inc. and Subsidiaries
Condensed Consolidating Statement of Income
Six months ended June 30, 2019


(in thousands)Hawaiian ElectricHawaii Electric LightMaui ElectricOther subsidiariesConsolidating adjustmentsHawaiian Electric
Consolidated
Revenues$855,689  177,121  179,703  —  (234) $1,212,279  
Expenses
Fuel oil234,353  40,783  67,093  —  —  342,229  
Purchased power232,094  43,206  21,999  —  —  297,299  
Other operation and maintenance159,729  36,767  40,894  —  —  237,390  
Depreciation71,735  20,906  15,219  —  —  107,860  
Taxes, other than income taxes81,221  16,811  17,215  —  —  115,247  
   Total expenses779,132  158,473  162,420  —  —  1,100,025  
Operating income76,557  18,648  17,283  —  (234) 112,254  
Allowance for equity funds used during construction5,061  350  674  —  —  6,085  
Equity in earnings of subsidiaries19,935  —  —  —  (19,935) —  
Retirement defined benefits expense—other than service costs(1,134) (211) (59) —  —  (1,404) 
Interest expense and other charges, net(26,190) (5,821) (4,739) —  234  (36,516) 
Allowance for borrowed funds used during construction1,864  147  246  —  —  2,257  
Income before income taxes76,093  13,113  13,405  —  (19,935) 82,676  
Income taxes10,853  3,011  3,114  —  —  16,978  
Net income65,240  10,102  10,291  —  (19,935) 65,698  
Preferred stock dividends of subsidiaries—  267  191  —  —  458  
Net income attributable to Hawaiian Electric65,240  9,835  10,100  —  (19,935) 65,240  
Preferred stock dividends of Hawaiian Electric540  —  —  —  —  540  
Net income for common stock$64,700  9,835  10,100  —  (19,935) $64,700  


Hawaiian Electric Company, Inc. and Subsidiaries
Condensed Consolidating Statement of Comprehensive Income
Six months ended June 30, 2019

(in thousands)Hawaiian ElectricHawaii Electric LightMaui ElectricOther subsidiariesConsolidating adjustmentsHawaiian Electric Consolidated
Net income for common stock$64,700  9,835  10,100  —  (19,935) $64,700  
Other comprehensive income (loss), net of taxes:
Retirement benefit plans:
Adjustment for amortization of prior service credit and net losses recognized during the period in net periodic benefit cost, net of tax benefits4,643  704  578  —  (1,282) 4,643  
Reclassification adjustment for impact of D&Os of the PUC included in regulatory assets, net of taxes(4,596) (702) (578) —  1,280  (4,596) 
Other comprehensive income, net of taxes47  2  —  —  (2) 47  
Comprehensive income attributable to common shareholder$64,747  9,837  10,100  —  (19,937) $64,747  
Hawaiian Electric Company, Inc. and Subsidiaries
Condensed Consolidating Balance Sheet
June 30, 2020
(in thousands)Hawaiian ElectricHawaii Electric LightMaui ElectricOther
subsi-
diaries		Consoli-
dating
adjustments		Hawaiian Electric
Consolidated
Assets      
Property, plant and equipment
Utility property, plant and equipment      
Land$42,389  5,606  3,612  —  —  $51,607  
Plant and equipment4,859,373  1,321,091  1,173,377  —  —  7,353,841  
Less accumulated depreciation(1,636,504) (586,351) (535,689) —  —  (2,758,544) 
Construction in progress170,655  20,181  23,651  —  —  214,487  
Utility property, plant and equipment, net3,435,913  760,527  664,951  —  —  4,861,391  
Nonutility property, plant and equipment, less accumulated depreciation
5,308  115  1,532  —  —  6,955  
Total property, plant and equipment, net3,441,221  760,642  666,483  —  —  4,868,346  
Investment in wholly owned subsidiaries, at equity599,198  —  —  —  (599,198) —  
Current assets      
Cash and cash equivalents55,170  4,594  4,130  101  —  63,995  
Restricted cash29,376  —  —  —  —  29,376  
Advances to affiliates13,500  —  —  —  (13,500) —  
Customer accounts receivable, net97,615  21,422  19,001  —  —  138,038  
Accrued unbilled revenues, net74,086  12,705  13,810  —  —  100,601  
Other accounts receivable, net19,409  3,592  4,358  —  (16,944) 10,415  
Fuel oil stock, at average cost30,477  14,965  15,037  —  —  60,479  
Materials and supplies, at average cost38,475  10,116  17,653  —  —  66,244  
Prepayments and other18,005  17,151  2,773  —  —  37,929  
Regulatory assets16,846  2,598  1,842  —  —  21,286  
Total current assets392,959  87,143  78,604  101  (30,444) 528,363  
Other long-term assets      
Operating lease right-of-use assets159,169  1,490  370  —  —  161,029  
Regulatory assets460,493  104,707  96,084  —  —  661,284  
Other76,482  16,915  19,588  —  —  112,985  
Total other long-term assets696,144  123,112  116,042  —  —  935,298  
Total assets$5,129,522  970,897  861,129  101  (629,642) $6,332,007  
Capitalization and liabilities      
Capitalization      
Common stock equity$2,060,069  304,088  295,009  101  (599,198) $2,060,069  
Cumulative preferred stock—not subject to mandatory redemption
22,293  7,000  5,000  —  —  34,293  
Long-term debt, net1,116,186  216,400  228,369  —  —  1,560,955  
Total capitalization3,198,548  527,488  528,378  101  (599,198) 3,655,317  
Current liabilities      
Current portion of operating lease liabilities64,405  97  32  —  —  64,534  
Current portion of long-term debt—  14,000  —  —  —  14,000  
Short-term borrowings from non-affiliates49,919  —  —  —  —  49,919  
Short-term borrowings from affiliate—  12,000  1,500  —  (13,500) —  
Accounts payable79,071  14,408  13,599  —  —  107,078  
Interest and preferred dividends payable14,580  3,349  2,736  —  (6) 20,659  
Taxes accrued133,321  32,526  28,004  —  —  193,851  
Regulatory liabilities11,467  7,401  7,199  —  —  26,067  
Other55,378  17,181  16,070  —  (16,938) 71,691  
Total current liabilities408,141  100,962  69,140  —  (30,444) 547,799  
Deferred credits and other liabilities      
Operating lease liabilities100,833  1,394  343  —  —  102,570  
Deferred income taxes261,044  52,485  57,523  —  —  371,052  
Regulatory liabilities674,621  178,861  98,231  —  —  951,713  
Unamortized tax credits84,885  15,773  14,348  —  —  115,006  
Defined benefit pension and other postretirement benefit plans liability
340,672  69,719  69,459  —  —  479,850  
Other60,778  24,215  23,707  —  —  108,700  
Total deferred credits and other liabilities1,522,833  342,447  263,611  —  —  2,128,891  
Total capitalization and liabilities$5,129,522  970,897  861,129  101  (629,642) $6,332,007  
Hawaiian Electric Company, Inc. and Subsidiaries
Condensed Consolidating Balance Sheet
December 31, 2019
(in thousands)Hawaiian ElectricHawaii Electric LightMaui ElectricOther
subsi-diaries		Consoli-
dating
adjustments		Hawaiian Electric
Consolidated
Assets      
Property, plant and equipment
Utility property, plant and equipment      
Land$42,598  5,606  3,612  —  —  $51,816  
Plant and equipment4,765,362  1,313,727  1,161,199  —  —  7,240,288  
Less accumulated depreciation(1,591,241) (574,615) (524,301) —  —  (2,690,157) 
Construction in progress165,137  9,993  17,944  —  —  193,074  
Utility property, plant and equipment, net3,381,856  754,711  658,454  —  —  4,795,021  
Nonutility property, plant and equipment, less accumulated depreciation
5,310  114  1,532  —  —  6,956  
Total property, plant and equipment, net3,387,166  754,825  659,986  —  —  4,801,977  
Investment in wholly owned subsidiaries, at equity
591,969  —  —  —  (591,969) —  
Current assets      
Cash and cash equivalents2,239  6,885  1,797  101  —  11,022  
Restricted cash30,749  123  —  —  —  30,872  
Advances to affiliates27,700  8,000  —  —  (35,700) —  
Customer accounts receivable, net105,454  24,520  22,816  —  —  152,790  
Accrued unbilled revenues, net83,148  17,071  17,008  —  —  117,227  
Other accounts receivable, net18,396  1,907  1,960  —  (10,695) 11,568  
Fuel oil stock, at average cost69,003  8,901  14,033  —  —  91,937  
Materials and supplies, at average cost34,876  8,313  17,513  —  —  60,702  
Prepayments and other88,334  3,725  24,921  —  —  116,980  
Regulatory assets27,689  1,641  1,380  —  —  30,710  
Total current assets487,588  81,086  101,428  101  (46,395) 623,808  
Other long-term assets      
Operating lease right-of-use assets174,886  1,537  386  —  —  176,809  
Regulatory assets476,390  109,163  98,817  —  —  684,370  
Other69,010  15,493  17,215  —  —  101,718  
Total other long-term assets720,286  126,193  116,418  —  —  962,897  
Total assets$5,187,009  962,104  877,832  101  (638,364) $6,388,682  
Capitalization and liabilities      
Capitalization
Common stock equity$2,047,352  298,998  292,870  101  (591,969) $2,047,352  
Cumulative preferred stock—not subject to mandatory redemption
22,293  7,000  5,000  —  —  34,293  
Long-term debt, net1,006,737  206,416  188,561  —  —  1,401,714  
Total capitalization3,076,382  512,414  486,431  101  (591,969) 3,483,359  
Current liabilities     
Current portion of operating lease liabilities63,582  94  31  —  —  63,707  
Current portion of long-term debt61,958  13,995  20,000  —  —  95,953  
Short-term borrowings-non-affiliate88,987  —  —  —  —  88,987  
Short-term borrowings-affiliate8,000  —  27,700  —  (35,700) —  
Accounts payable139,056  25,629  23,085  —  —  187,770  
Interest and preferred dividends payable14,759  3,115  2,900  —  (46) 20,728  
Taxes accrued143,522  32,541  31,929  —  —  207,992  
Regulatory liabilities13,363  9,454  7,907  —  —  30,724  
Other51,295  11,362  15,297  —  (10,649) 67,305  
Total current liabilities584,522  96,190  128,849  —  (46,395) 763,166  
Deferred credits and other liabilities     
Operating lease liabilities111,598  1,442  360  —  —  113,400  
Deferred income taxes265,864  53,534  57,752  —  —  377,150  
Regulatory liabilities664,894  178,474  98,218  —  —  941,586  
Unamortized tax credits86,852  16,196  14,820  —  —  117,868  
Defined benefit pension and other postretirement benefit plans liability
339,471  69,928  69,364  —  —  478,763  
Other57,426  33,926  22,038  —  —  113,390  
Total deferred credits and other liabilities1,526,105  353,500  262,552  —  —  2,142,157  
Total capitalization and liabilities$5,187,009  962,104  877,832  101  (638,364) $6,388,682  
Hawaiian Electric Company, Inc. and Subsidiaries
Condensed Consolidating Statement of Changes in Common Stock Equity
Six months ended June 30, 2020
(in thousands)Hawaiian ElectricHawaii Electric LightMaui ElectricOther
subsidiaries		Consolidating
adjustments		Hawaiian Electric
Consolidated
Balance, December 31, 2019$2,047,352  298,998  292,870  101  (591,969) $2,047,352  
Net income for common stock66,234  13,246  9,334  —  (22,580) 66,234  
Other comprehensive income (loss), net of taxes51  4  (3) —  (1) 51  
Common stock dividends(53,568) (8,160) (7,192) —  15,352  (53,568) 
Balance, June 30, 2020$2,060,069  304,088  295,009  101  (599,198) $2,060,069  
 
Hawaiian Electric Company, Inc. and Subsidiaries
Condensed Consolidating Statement of Changes in Common Stock Equity
Six months ended June 30, 2019  
(in thousands)Hawaiian ElectricHawaii Electric LightMaui ElectricOther
subsidiaries		Consolidating
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 stock64,700  9,835  10,100  —  (19,935) 64,700  
Other comprehensive income, net of taxes
47  2  —  —  (2) 47  
Common stock dividends(50,626) (5,090) (7,534) —  12,624  (50,626) 
Common stock issuance expenses—  (2) —  —  2  —  
Balance, June 30, 2019$1,971,762  300,619  283,429  101  (584,149) $1,971,762  
Hawaiian Electric Company, Inc. and Subsidiaries
Condensed Consolidating Statement of Cash Flows
Six months ended June 30, 2020
(in thousands)Hawaiian ElectricHawaii Electric LightMaui ElectricOther
subsidiaries		Consolidating
adjustments		Hawaiian Electric
Consolidated
Net cash provided by operating activities$154,967  20,307  21,601  —  (15,407) $181,468  
Cash flows from investing activities      
Capital expenditures(129,829) (30,785) (25,918) —  —  (186,532) 
Advances from affiliates14,200  8,000  —  —  (22,200) —  
Other4,354  552  480  —  55  5,441  
Net cash used in investing activities(111,275) (22,233) (25,438) —  (22,145) (181,091) 
Cash flows from financing activities      
Common stock dividends(53,568) (8,160) (7,192) —  15,352  (53,568) 
Preferred stock dividends of Hawaiian Electric and subsidiaries(540) (267) (191) —  —  (998) 
Proceeds from issuance of short-term debt100,000  —  —  —  —  100,000  
Repayment of short-term debt(100,000) —  —  —  —  (100,000) 
Proceeds from issuance of long-term debt205,000  10,000  40,000  —  —  255,000  
Repayment of long-term debt and funds transferred for 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) 12,000  (26,200) —  22,200  (38,987) 
Other(1,039) (61) (247) —  —  (1,347) 
Net cash provided by financing activities7,866  (488) 6,170  —  37,552  51,100  
Net increase (decrease) in cash and cash equivalents51,558  (2,414) 2,333  —  —  51,477  
Cash, cash equivalents and restricted cash, beginning of period32,988  7,008  1,797  101  —  41,894  
Cash, cash equivalents and restricted cash, end of period84,546  4,594  4,130  101  —  93,371  
Less: Restricted cash(29,376) —  —  —  —  (29,376) 
Cash and cash equivalents, end of period$55,170  4,594  4,130  101  —  $63,995  
Hawaiian Electric Company, Inc. and Subsidiaries
Condensed Consolidating Statement of Cash Flows
Six months ended June 30, 2019
(in thousands)Hawaiian ElectricHawaii Electric LightMaui ElectricOther
subsidiaries		Consolidating
adjustments		Hawaiian Electric
Consolidated
Net cash provided by operating activities$84,427  16,406  12,607  —  (12,624) $100,816  
Cash flows from investing activities                                                                                                                                        
Capital expenditures (150,945) (18,083) (30,868) —  —  (199,896) 
Advances to affiliates(25,300) (5,000) —  —  30,300  —  
Other2,821  (280) (31) —  —  2,510  
Net cash used in investing activities(173,424) (23,363) (30,899) —  30,300  (197,386) 
Cash flows from financing activities     
Common stock dividends(50,626) (5,090) (7,534) —  12,624  (50,626) 
Preferred stock dividends of Hawaiian Electric and subsidiaries(540) (267) (191) —  —  (998) 
Proceeds from issuance of short-term debt25,000  —  —  —  —  25,000  
Proceeds from issuance of long-term debt30,000  10,000  10,000  —  —  50,000  
Repayment of long-term debt(31,546) (10,000) (10,000) —  —  (51,546) 
Net increase in short-term borrowings from non-affiliates and affiliate with original maturities of three months or less116,901  —  25,300  —  (30,300) 111,901  
Other197  43  83  —  —  323  
Net cash provided by (used in) financing activities89,386  (5,314) 17,658  —  (17,676) 84,054  
Net increase (decrease) in cash and cash equivalents389  (12,271) (634) —  —  (12,516) 
Cash and cash equivalents, beginning of period16,732  15,623  3,421  101  —  35,877  
Cash and cash equivalents, end of period$17,121  3,352  2,787  101  —  $23,361