Utility on the hook for $2bn in Maui fire settlement

Hawaii’s investor-owned utility will pay nearly half of a $4 billion settlement to support victims of the Maui wildfires last year.

It appears the deal will allow Hawaiian Electric to avoid bankruptcy. Hawaiin Electric has admitted that downed powerlines initially caused the fires, which are blamed for killing more than 100 people and damaging thousands of buildings. The settlement, however, does not include any admission of liability.

Many of the utility’s 60,000, mostly wooden power poles, which its documents described as built to “an obsolete 1960s standard,” were leaning and near the end of their projected lifespan. They were nowhere close to meeting a 2002 national standard that key components of Hawaii’s electrical grid be able to withstand 105-mile-per-hour winds.

The $4 billion total settlement between Hawaiian Electric, the State of Hawaii, the County of Maui, Kamehameha Schools, West Maui Land Co., Hawaiian Telcom, and Spectrum/Charter Communications was reached after a 4-month negotiation, the parties said.

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“While the settlement will close one chapter in the Maui recovery, the story will continue for many years and generations,” Hawaiian Electric CEO Shelee Kimura said in a statement. “Our objective is to make sure a tragedy like this never happens again.”

Hawaiian Electric said the settlement will bring greater certainty for the company, enabling it to begin to reestablish the financial stability needed to invest in a sustainable and resilient future.

Once a final settlement agreement is signed, it will take effect following judicial review and approval. Hawaiian Electric said payments would begin after such approval and are expected to be made no earlier than mid-2025.

Originally published by John Engel on Power Grid International.