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The Honolulu Advertiser
Posted on: Friday, December 5, 2008

Hawaii's electric bills are dropping again

By Greg Wiles
Advertiser Staff Writer

Hawaii news photo - The Honolulu Advertiser
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Electricity bills are continuing to recede throughout the state as energy prices trace the decline in crude oil prices.

Hawaiian Electric Co.'s utilities on O'ahu, the Big Island and Maui are reducing prices, while the Kauai Island Utility Cooperative also is cutting rates for electricity sales this month.

HECO said the average utility customers on O'ahu using 600 kilowatt-hours of electricity should receive bills of $158.06 in December.

That represents a $23.95 decline from November's average bill of $182.01.

The decline marks the third consecutive month residential bills on O'ahu have declined after the average customer's bill reached $202.13 in September. Hawai'i's electricity prices soared earlier this year as crude oil spiked because petroleum fuels 76 percent of the state's electrical generators, according to U.S. Energy Information Administration data. That's more than any other state.

The reliance on petroleum is one reason why Hawai'i residents pay the highest average statewide electricity rates in the U.S. and electricity prices have risen this year as crude reached a high of $147.11 a barrel in the summer. As of yesterday, New York Mercantile Exchange prices had dropped to $43.67 for a barrel for January delivery.

HECO passes through increases in fuel oil costs to consumers in something that's called the Energy Cost Adjustment clause on its bills.

HECO spokesman Peter Rosegg said the utility expects to see a further decline in electricity rates in January. Rosegg noted that price declines aren't uniform because each island uses a different mix of fuel.

O'ahu, for example, uses mostly low-sulfur fuel oil, while Maui uses diesel and the Big Island uses mostly medium sulfur fuel oil. The islands also have different storage capacities that figure into how fast fuel bought at higher prices is used up before lower-cost inventory is figured into the electricity prices.

Typical December bills will be:

  • On O'ahu, the effective residential rate will decline to 24.9 cents per kilowatt-hour from 28.9 cents in November.

  • The typical Maui household using 600 kilowatt-hours should see their December bill drop to $191.78, or $26.80 less than November. The effective rate is falling to 30.6 cents per kilowatt-hour.

  • Big Island residential customers will see a decline in rates to 38.5 cents. The typical 600 kilowatt-hour bill will drop to $241.88 from $255.72 last month.

  • Kaua'i residential customers will be charged an effective rate of 27.5 cents per kilowatt-hour. That's almost 10 cents less than in November. Kaua'i's residential rate has fallen 44 percent since reaching a high of 49.2 cents in August.

    Bloomberg News Service contributed to this report.

    Reach Greg Wiles at gwiles@honoluluadvertiser.com.