Senate committees advance wildfire recovery fund with amendments after hours of testimony

The Hawaii State Senate’s joint committees on Commerce and Consumer Protection and on Energy and Intergovernmental Affairs voted Tuesday to pass SB1201, a bill to establish a wildfire recovery fund and allow securitization for electric utilities, with multiple amendments and a defective effective date to permit further drafting.

Why it matters: Supporters say the bill would provide faster compensation to wildfire victims and help Hawaiian Electric Company (HECO) regain an investment‑grade credit rating so the utility can finance grid hardening and new renewable projects. Opponents and some consumer advocates warned the bill could cap liability, shift large costs to ratepayers, and leave unanswered questions about administration, timing and claim procedures.

Jason Ben, senior vice president for Hawaiian Electric, told the committees the measure “is in the public interest” and frames it as protection for both residents and the state economy. He said the fund would create “a speedy and fair compensation process while preserving individuals’ rights to pursue litigation” and would shield customers from cost increases tied to unlimited wildfire liability. Ben and other utility witnesses stressed a roughly $1 billion fund target included in discussions and said the legislation is one of several steps needed to restore the company’s credit standing.

Union and supplier witnesses sided with HECO. Kika Bukowski of IBW Local 1260 said the bill would help employees by allowing the utility to meet its mandates at lower cost. Eric Wright of Par Hawaii, a fuel supplier, said timely payments from HECO are essential to local suppliers and contractors.

Consumer and victims’ advocates urged caution. Evan Oye of the Hawaii Association for Justice said he opposed liability caps that could limit victims’ recoveries and criticized lack of clarity around the executive director’s authority and offer timing. Henry Curtis of Life of the Land raised the catastrophe definition, noting that had the bill been law before the Lahaina fire, the event might not have triggered the fund.

Developers and financiers also testified. Brian Duncan of Plus Power and other independent power producers warned that HECO’s non‑investment grade rating makes financing large renewable projects difficult; they said the bill would help maintain contracted projects and attract future investment.

Committee amendments adopted Tuesday reflect several concessions requested during the hearing: lawmakers removed specified dollar amounts for initial ratepayer and shareholder contributions, struck a sentence that would bar late claimants from legal action, deleted a proposed aggregate liability cap, adopted several PUC‑drafted clarifications narrowing covered wildfire recovery costs, and added a requirement that utilities seeking securitization submit an annual wildfire mitigation plan compliance report reviewed by the Public Utilities Commission (PUC). An amendment conditions approval of executive pay raises at a utility approved for a financing order on five consecutive years of PUC approval of the mitigation reports. The committees set a defective effective date to allow continued negotiations among stakeholders.

Outcome and next steps: Both committees recorded votes to pass SB1201 with amendments. The committees left open a number of details for later amendment—most notably the share of initial contributions and the fund’s administrative design—and flagged the need to watch California’s fund rollout and the recent Hawaii Supreme Court subrogation ruling related to the Maui wildfires as factors that could affect program design.

The measure moves forward for additional drafting and scheduling; committee sponsors said the amendments were intended to keep the vehicle moving so stakeholders could continue negotiations before final enactment.