Hawaiian Electric accused of mismanagement in Maui wildfire wake

Hawaiian Electric has come under attack after being accused of potential mismanagement leading to the wildfires that have ravaged the US island state.

According to S&P Global, the utility’s shares plunged as much as 42% at the start of the week under the threat of a class-action lawsuit in the wake of the wildfires on Maui, which claimed the lives of over 100 people to date and widespread destruction across the island.

According to S&P, attorneys from three firms in California and Hawaii filed a complaint with the Oahu District Court alleging that Hawaiian Electric equipment “foreseeably ignited the fastmoving, deadly, and destructive Lahaina Fire.”

S&P notes that the complaint suggests that the utility should have de-energised power lines after the National Weather Service issued a red flag warning and “knew that their electrical infrastructure was inadequate, ageing, and/or vulnerable to foreseeable and known weather conditions.”

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Reportedly, states the Washington Post, power lines are the likely cause of the fire. Namely, an electrical malfunction was directly correlated with data of a Hawaiian Electric power system problem, adding evidence that the state’s main utility equipment sparked multiple fires.

The Wall Street Journal reports that the utility, which is the parent company of Maui Electric Company and serves 95% of Hawaii’s 1.4 million residents, is speaking with restructuring advisory firms to address financial and legal challenges over its potential liabilities.

S&P Global Ratings has downgraded the utility to BB-, otherwise known as junk status, warning investors that the utility is a risky bet, due to the high risk of default.

After the wildfires broke out last week, the Hawaiian utility warned of extended outages, which affected over 12,400 customers.

As of Wednesday, restoration has still been underway on transmission lines, with approximately 2,000 customers remaining without electricity in West Maui.

According to Hawaiian Electric, crews are currently working to install a second mobile substation to support restoration efforts and more than 100 utility poles will be needed. A shipment is expected to arrive from Oahu covering the utility pole requirements as well as supplying fencing and other equipment.

According to the National Interagency Fire Centre, 68,988 wildfires burned more than 7.5 million acres of US land last year.

The lawsuit against Hawaiian Electric is the latest case of a utility being associated with a wildfire. In the past years, lawsuits have been filed against PacifiCorp and PG&E.