On May 31, the Hawaii Public Utility Commission ruled that the Maui Electric Company could only collect 9 percent profit from ratepayers instead of 10 percent.
As a result of this decision, MECO, a subsidiary of Hawaii Electric Company, has presented a plan to refund its utility customers in Maui County. The decision was one of the few times in recent history that the PUC has gone against HECO, which provides electric service to every county but Kauai.
MECO’s plan, submitted on Monday to the PUC, will return $7.8 million on an annualized basis (plus interest) to electric customers on Maui, Lanai, and Molokai. The refund amount will vary depending on the cumulative amount of electricity used by customers between June 1, 2012 and July 31, 2013. The refund will appear in the form of a credit on customers’ bills.
The refund amount per customer could also vary depending on how the PUC rules on requests Maui Electric filed last week. MECO is asking for four things: 1. An opportunity to provide information to be included on the record through an evidentiary hearing; 2. Clarification of the accounting treatment for certain costs; 3. Reconsideration of the reduction in the rate of return on equity that is used to determine electric rates; and 4. A stay on refunding only the amount related to the issues identified in the filings.
If the PUC grants Maui Electric’s Motion for Partial Stay, the refund amount would be less than the $7.8 million annualized revenue amount identified in the PUC’s final decision. A typical Maui customer using 600 kilowatt hours per month would be refunded about $30, while typical Lanai or Molokai customers using 400 kilowatt hours per month would be refunded about $24. Any additional refund would depend on the PUC’s later decision on the issues for which Maui Electric has asked to present more information.
Former customers during the time the higher interim increase was in effect will also be eligible for the refund. Instructions will be publicized later for those customers. Current Maui Electric customers do not need to take any action to receive the credit.
The timing of the refunds will depend on the PUC’s decisions on the proposed refund plan. Maui Electric anticipates it will be able to start issuing the refunds in September and complete the process by the end of October.