HECO (Hawaiian Electric Company) has started collecting bills from its first month under their new rate package and price hikes. Needless to say, it only took one month for electric rates on Oahu to set record highs.
At first glance the new rates don’t look like too much of a hike in original prices. However, if you break down the math and then add back what the difference is then you can see how much more Hawaii families are now paying.
Here is how it breaks down:
A typical single family household that is using around 600 kilowatt hours of electricity a month saw its electric bill rise to $205.44 (give or take a few cents) in August, which was up from $199.68 in July. The August rate of 32.9 cents and hour was up from 31.9 cents an hour in July. This number surpassed the previous all-time high of 32.5 cents that was reached in September of 2008.
If you take the time to break that rate hike down even further you will be able to se the staggering amount of money that HECO will take in due to the hike. While this is being called an “interim rate hike,” it doesn’t really seem like the rate hike is going to be taken away anytime in the foreseeable future.
HECO is stating that the rate hike is going to be used to pay for capital improvement projects, however they did throw in that the hike was “primarily based on fuel related costs.” Since around three-fourths of Hawaii’s electricity generation comes from petroleum fired power plants, it leaves our state very vulnerable to the up and down price spikes of oil.
Hawaii already had the highest electricity rates in the nation. This new raise hike is going to put the state far and away ahead of anyone else in the nation. As a matter of fact, it is not even close. What exactly is the comparison? Well, the average rate of electricity around the rest of the nation is 11.2 cents per kilowatt-hour. If you compare that to the 31.04 cents per kilowatt-hour average in Hawaii, then you can see that we are paying a huge difference for the benefit of electricity in the islands.
How much are Hawaii residents willing to pay? Doesn’t their have to be a cutoff point in prices at some point? Or will HECO be able to raise electric rates at will?