PUC Approves New Firm Generation to Address Oʻahu’s Critical Electric Reliability Needs
News release from Public Utilities Commission, Mar 23, 2026
HONOLULU – The Public Utilities Commission today approved the Hawaiian Electric Company Waiau Repowering Project, to address urgent reliability needs on Oʻahu’s electric grid, while putting in place strict cost controls to limit financial impacts on customers.
(REALITY: Rate hike is at the bottom of this news release.)
The project proposes to replace six aging, inflexible oil-fired steam units with six new fuel-flexible, simple-cycle combustion turbines totaling 253 megawatts. As a condition of approval, Hawaiian Electric must operate the new units on a minimum of 51 percent renewable fuel at commissioning of the first four units or by 2032, whichever occurs first, increasing to 75 percent by 2040 and 100 percent by 2045 to ensure continued progress toward the state’s renewable energy goals.
REALITY: Biodiesel is produced by bulldozing the rainforest in Borneo and the Amazon. The rainforests were really good carbon sinks.)
REALITY: Biofuel Shell Game: How Giant Diesel Plant Became part of Hawaii's 'Clean' Energy Future
The new units’ flexibility and fast‑start capabilities will enable more integration of renewable energy and improve reliability as older fossil-fuel burning units are retired. The new units will also help maintain sufficient firm power to support grid resiliency and reliability during the transition to a 100% renewable energy future.
(REALITY: ‘Simple Cycle’ is about half as efficient as ‘Combined Cycle’. That means it is almost twice as expensive and twice as dirty to operate. Its’ only advantage is its ability to power up quickly to make up for failed, erratic electricity from wind and solar.)
The project was selected through a competitive bidding procurement process that was overseen by an independent observer and independent engineer, which sought firm renewable resources on Oʻahu to improve system reliability while helping to move the state closer to its clean energy goals.
(TRANSLATION: The bid was rigged to support the dirtier, more expensive ‘simple cycle’ generation system.)
After selection under the competitive bidding process, the commission completed a comprehensive review of the project’s anticipated benefits and costs to carefully balance system reliability, safety and affordability.
(TRANSLATION: The solar industry makes lots of campaign contributions. We had to make sure to give them what they need.)
To safeguard customers, the commission did not approve Hawaiian Electric’s amended request to recover up to $1.155 billion for the project. Instead, the commission set a cost recovery cap at the utility’s original competitive bid of $847 million, plus a limited inflation adjustment.
(IQ Test: Are you often impressed by this trick? They do it EVERY time they take more money from you.)
Pursuant to this cap, Hawaiian Electric may not recover more than that amount from customers through electricity rates, even if its final costs exceed it. If the final project cost is less than the bid, the company may only recover the lower, actual cost. Based on the cap, the project is estimated to increase the bill of a typical residential customer on Oʻahu by about $3.62 per month.
(CLUE: That is only to recoup the capital investment. It does not account for the higher operating costs. Notice how the 80-year old Waiau plant is being improved WITHOUT any efficiency gain?)
This action reflects the commission’s continued commitment to balancing safety, reliability, affordability, and Hawaiʻi’s long‑term clean energy goals.
The decision and order, along with a summary of it, is available here.
More Information:
* * * * *
ENERGY AFFORDABILITY SIGNALLED AS STATE PRIORITY
Public Utilities Commission Heeds Calls for Rate Accountability in Waiau Repowering
News Release from DBEDT HSEO, March 27, 2026
HONOLULU — The First Decision and Order issued by the Public Utilities Commission (PUC), under the direction of Chair Jon Itomura, signals energy affordability as a state priority, supporting broad state initiatives on affordable housing, healthcare and a firm commitment to reduce the cost of living for Hawaiʻi residents.
In its decision, the PUC did not approve Hawaiian Electric’s request to recover up to $1.155 billion from ratepayers to upgrade the 75-year-old Waiau power plant, but instead set a cost-recovery cap at the utility’s original competitive bid of $847 million, plus a limited inflation adjustment of 10%, in a win for ratepayers.
“This administration will continue to fight for greater affordability for Hawaiʻi’s people,” said Governor Josh Green. “Hawaiʻi residents have dealt with reliability concerns and the highest electricity costs in the nation, due to polluting fuels imported from places like Libya and inefficient power generation for decades. We have a generational opportunity to make meaningful change and my administration has been united in saying we will not condemn another generation to costly utility bills that it can’t afford.”
Agencies including the PUC, the Consumer Advocate and the Hawaiʻi State Energy Office supported the imposition of strict cost controls to limit the financial impacts of the Decision on customers.
In its Order, the PUC also requires HECO to meet specific renewable-fuel milestones to ensure the Waiau project supports the state’s transition to a 100% renewable energy future, requiring the utility to operate the units with at least 51% renewable fuel by 2032, or when the first four units begin service, whichever occurs first, 75% renewable fuel by 2040 and 100% renewable fuel by 2045.
Previously, in a Statement of Position filed in the Waiau Docket, Chief Energy Officer Mark Glick requested that the PUC delay final approval of the Waiau Repower Project to more fully address the Project’s revised cost profile that exceeded limits imposed by the Competitive Bidding Framework; and to be made aware of a more comprehensive firm capacity proposal under a Strategic Partnering Agreement with JERA announced on October 7, 2025, that is estimated to reduce costs for the average Hawaiʻi household by $500 a year.
While the delay was not granted, Glick lauded the imposition of cost controls in the Decision and Order consistent with the Competitive Bidding Framework limits cited by the State Energy Office, saying: “The PUC’s action on this Docket reflects a continued commitment to balancing safety, reliability and affordability that underlies Hawaiʻi’s long‑term clean energy goals.”
The Green administration will continue to aggressively advocate for local residents and businesses alike by pushing for cost accountability at the PUC, protecting renewable development support and by spearheading new energy opportunities that lower consumer bills.
In a proposal submitted to the state on March 17, 2026, JERA, Japan’s largest power producer, identified LNG as a cost-effective component of lowering the state’s carbon emissions, accelerating renewable energy integration onto the grid and going well beyond estimated savings in the HSEO Alternative Fuels, Repowering and Energy Transition Study. JERA proposes conclusive cost savings of 20% over oil (an average of $500/year per household) and 50% savings over imported biofuels, with LNG infrastructure paid back in less than two years.
The company has indicated that a full proposal to the PUC is pending, which will provide regulators and ratepayers with additional energy pathways, all of which will have to undergo PUC and regulatory evaluation.
Continuing on a status quo path will result in rising energy prices and Hawaiʻi continuing to generate electricity by burning oil, when the price of crude oil hovers close to $100/barrel and the cost of gasoline has spiked above $5/gallon.
“We have a credible proposal on the table to make energy more affordable,” Governor Green concluded. “People want change—this administration will continue to deliver change that prioritizes the needs of the people of Hawaiʻi.”
COVERAGE:
SA: Waiau power plant Biofuel project approved | Honolulu Star-Advertiser
IM: Over HSEO Objections PUC Approved Waiau Repowering Project With Biofuel Conversion | Ililani Media
IM: PUC Approved HECO`s Self Build Waiau Repowering Project With Conditions | Ililani Media
ASD: Power bills to rise under HECO proposal
PBN: Hawaiian Electric wins approval for Waiau Power Plant upgrade - Pacific Business News