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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the
Securities Exchange Act of 1934
Date of Report: November 27, 2001
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Exact Name of Registrant Commission I.R.S. Employer
as Specified in Its Charter File Number Identification No.
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Hawaiian Electric Industries, Inc. 1-8503 99-0208097
Hawaiian Electric Company, Inc. 1-4955 99-0040500
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State of Hawaii
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(State or other jurisdiction of incorporation)
900 Richards Street, Honolulu, Hawaii 96813
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(Address of principal executive offices and zip code)
Registrant's telephone number, including area code:
(808) 543-5662 - Hawaiian Electric Industries, Inc. (HEI)
(808) 543-7771 - Hawaiian Electric Company, Inc. (HECO)
None
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(Former name or former address, if changed since last report.)
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Item 5. Other Events
A. HELCO power situation
In 1991, Hawaii Electric Light Company, Inc. (HELCO) began planning to meet
increased electric generation demand forecasted for 1994. HELCO's plans were to
install at its Keahole power plant two 20 MW combustion turbines (CT-4 and
CT-5), followed by an 18 MW heat steam recovery generator (ST-7), at which time
these units would be converted to a 56 MW (net) dual-train combined-cycle unit.
In January 1994, the PUC approved expenditures for CT-4, which HELCO had planned
to install in late 1994. The timing of the installation of HELCO's phased units
has been revised on several occasions due to delays in obtaining an amendment of
a land use permit from the Hawaii Board of Land and Natural Resources (BLNR) and
an air permit from the Department of Health of the State of Hawaii (DOH) and the
U.S. Environmental Protection Agency (EPA) for the Keahole power plant site. The
delays are also attributable to lawsuits, claims and petitions filed by
independent power producers (IPPs) and other parties challenging these permits
and objecting to the expansion, alleging among other things that (1) operation
of the expanded Keahole site would not comply with land use regulations
(including noise standards) and HELCO's land patent; (2) HELCO cannot operate
the plant within current air quality standards; (3) HELCO could alternatively
purchase power from IPPs to meet increased electric generation demand; (4)
HELCO's land use entitlement expired in April 1999 and HELCO's request for an
extension must be heard in a contested case hearing; and (5) recent public
testimony by a former BLNR member calls into question the 1996 voting by the
BLNR and is a basis for having the 1998 final judgment sent back to the Circuit
Court from the Supreme Court for further review.
For a detailed description and a partial history of the Keahole Power Plant
situation, see "HELCO power situation" on pages 9 to 17 of HEI's Annual Report
on SEC Form 10-K for the year ended December 31, 2000 and on pages 17 to 20 of
HEI's Quarterly Report on SEC Form 10-Q for the quarter ended September 30,
2001. Recent developments regarding this situation are described below.
Land use permit amendment. The Third Circuit Court of the State of Hawaii (the
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Circuit Court) ruled in 1997 that because the BLNR had failed to render a valid
decision on HELCO's application to amend its land use permit before the
statutory deadline in April 1996, HELCO was entitled to use its Keahole site for
the expansion project (HELCO's "default entitlement"). Final judgments of the
Circuit Court related to this ruling are on appeal to the Hawaii Supreme Court,
which in 1998 denied motions to stay the Circuit Court's final judgment pending
resolution of the appeal.
The Circuit Court's final judgment provided that HELCO must comply with the
conditions in its application and with the standard land use conditions insofar
as those conditions were not inconsistent with HELCO's default entitlement.
There have been numerous proceedings before the Circuit Court and the BLNR in
which certain parties (a) have sought determinations of what conditions apply to
HELCO's default entitlement, (b) have claimed that HELCO has not complied with
applicable land use conditions and that its default entitlement should thus be
forfeited, (c) have claimed that HELCO will not be able to operate the proposed
plant without violating applicable land use conditions and provisions of
Hawaii's Air Pollution Control Act and Noise Pollution Act and (d) have sought
orders enjoining any further construction at the Keahole site.
In September 2000, the Circuit Court orally ruled that, absent a legal or
equitable extension properly authorized by the BLNR, the three-year construction
period in the standard land use conditions of the Department of Land and Natural
Resources of the State of Hawaii (DLNR) expired in April 1999. In October 2000,
HELCO filed with the BLNR a request for extension of the construction deadline
and, in January 2001, the BLNR sent the request to a contested case hearing,
which was held in September 2001. In a document dated November 5, 2001, the
hearings officer recommended that the BLNR approve HELCO's request for extension
of the construction deadline. The recommendation does not state a time period
for the extension, but concludes that an extension is warranted, "under such
conditions as the Board may deem advisable." In a document dated November 7,
2001, the hearings officer
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issued rulings on the opponents' proposed findings of fact, conclusions of law
and motions. Each of the parties filed exceptions to the recommendation on
November 30, 2001. HELCO's exceptions requested that the November 7, 2001
rulings not be adopted, as many of them are arguably inconsistent with the
November 5, 2001 recommendation. The matter will be decided at a hearing before
the BLNR.
Air permit. In 1997, the DOH issued a final air permit for the Keahole expansion
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project. Nine appeals of the issuance of the permit were filed with the EPA's
Environmental Appeals Board (EAB). In November 1998, the EAB denied the appeals
on most of the grounds stated, but directed the DOH to reopen the permit for
limited purposes. The EPA and DOH required additional data collection, which was
satisfactorily completed in April 2000. A final air permit was reissued by the
DOH in July 2001. Six appeals were subsequently filed with the EAB. On November
27, 2001, the EAB issued an "Order Denying Review" of the appeals. Accordingly,
the final air permit was effective as of November 27, 2001.
B. News release
On December 4, 2001, HEI issued the following news release:
HAWAIIAN ELECTRIC INDUSTRIES, INC. TO WEBCAST AND TELECONFERENCE FINANCIAL
ANALYST PRESENTATION ON TUESDAY, DECEMBER 11, 2001
HONOLULU - Hawaiian Electric Industries, Inc. (NYSE - HE) today announced
that its Tuesday, December 11, 2001 financial analyst presentation in New York
will be broadcast live on its website and via teleconference beginning at
approximately 12.20 p.m. EST. The event can be accessed through HEI's website at
http://www.hei.com or by dialing (212) 896-6015 for the teleconference call.
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An online replay will be available at the same website beginning about two
hours after the event and continuing through Wednesday, December 26, 2001.
Replays of the teleconference call will also be available approximately two
hours after the event through Wednesday, December 26, 2001 by dialing (800)
633-8284, pass code: 20061327.
Hawaiian Electric Industries, Inc. is a diversified holding company. Its
core businesses are electric utilities and a bank.
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SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the
Registrants have duly caused this report to be signed on their behalf by the
undersigned thereunto duly authorized. The signature of the undersigned
companies shall be deemed to relate only to matters having reference to such
companies and any subsidiaries thereof.
HAWAIIAN ELECTRIC INDUSTRIES, INC. HAWAIIAN ELECTRIC COMPANY, INC.
(Registrant) (Registrant)
/s/ Robert F. Mougeot /s/ Richard A. von Gnechten
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Robert F. Mougeot Richard A. von Gnechten
Financial Vice President, Treasurer Financial Vice President of HECO
and Chief Financial Officer
(Principal Financial Officer of HEI) (Principal Financial Officer of HECO)
Date: December 5, 2001 Date: December 5, 2001
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